The Rise or Fall of the American Empire

Dan Drezner:

Dear Bob and Gideon,

It's an honor to be moderating this discussion between the two of you. You have both managed to author interesting and cogently argued books that are nevertheless at odds with each other on the future of world order. Gideon, you are of the belief that the Age of Anxiety is upon us, due in no small part to the waning of American power and the Western model of political economy more generally. Bob, you rebut arguments about American decline by pointing out the ways in which current commentators have wildly exaggerated American power in the past and the ways in which current U.S. power resources are still quite robust.

Where you both seem to agree is on the necessity of American power to ensure global order and prosperity. Gideon, you asserted in Zero-Sum Future that "a strong, successful, and confident America remains the best hope for a stable and prosperous world." Bob, in the excerpt of The World America Made that appeared in the New Republic, you conclude, "If American power declines, this world order will decline with it. It will be replaced by some other kind of order, reflecting the desires and the qualities of other world powers." On this dimension, you two are kindred spirits and at odds with people like John Ikenberry, who argues in Liberal Leviathan that rising powers will embrace the liberal order created by the United States and its allies more than 60 years ago.

To get the ball rolling, let me start with a few queries for Gideon. Your book came out before the Arab Spring, the U.S. "pivot" to the Pacific Rim, the new and exciting phase of the euro crisis, and hints that China's growth is slowing down. Do any of these events prompt a rethink on your part? If not, do Bob's assertions of continued American primacy ease your anxiety at all? Finally, according to FP, The World America Made has found a very influential audience: Barack Obama is apparently a fan. To go Barbara Walters on you, if there were one world leader you'd want to have read Zero-Sum World, who would it be and why?

Cheers,
Dan

Gideon Rachman:

Dear Dan,

You are right that Bob and I agree on the importance of American power for the stability and prosperity of the world. Where we differ is that I believe that we are witnessing a serious erosion of U.S. power. This is part of a broader phenomenon: A world dominated by the West is giving way to a new order in which economic and political power is much more contested.

You pose some excellent questions about how events since I completed the book, at the beginning of 2010, have affected my argument. Before I address them directly, I should briefly explain what I mean by an "Age of Anxiety."

My book argues that globalization was not just an economic phenomenon. It was also the central geopolitical development of the 30 years before the financial crisis. It created a web of common interests between the world's major powers, replacing the divided world of the Cold War with a single world order in which all the big powers were bound into a common capitalist system. If you had gone to Davos during this period, you would have found the leaders of the Chinese Communist Party, the European Union, and the United States saying very similar things about the need to encourage world trade, foreign investment, and so on. They shared important assumptions about how the world should be run.

I describe the period from 1991 to 2008 as an "Age of Optimism" because all the world's major powers had reason to be satisfied with the way the globalized world system was working for them. India's reforms began in 1991 and led to an economic boom and a palpable surge in national confidence. The European Union more than doubled in size by incorporating the old Soviet bloc. Latin America had its debt crises, but by the end of the period, Brazil was being taken seriously as a global power for the first time in its history. For all their post-Soviet nostalgia, even the leaders of the new Russia were enthusiastic participants in a globalized world.

Most importantly, 1991-2008 was an Age of Optimism for both China and the United States. During this period, China's economy grew so rapidly that it was doubling in size every eight years or so. Chinese people could see their country and their families becoming visibly more prosperous. Still, the United States was the sole superpower. The growth of Silicon Valley and the rise of Google, Apple, et al. reaffirmed American confidence in the unique creative powers of U.S. capitalism. American political and economic ideas set the terms of the global debate. Indeed, the terms "globalization" and "Americanization" almost seemed synonymous.

This American confidence was very important to the world system. It allowed the United States to embrace a development that, in other circumstances, might have seemed threatening: the rise of China. In the Age of Optimism, successive U.S. presidents welcomed China's economic development. The argument they made was that capitalism would act as a Trojan horse, transforming the Chinese system from within. If China embraced economic freedom, political freedom would surely follow. But if China failed to embrace capitalism, it would fail economically.

In 2008, there was indeed a massive economic and financial crisis, but it came in the West, not in China. This unexpected development has accelerated a trend that was already in place: a shift in economic power from West to East and, within that, from the United States to China. Since then, it has become much harder to argue that globalization has created a win-win world. Instead, Americans are beginning to wonder, with good reason, whether a richer and more powerful China might mean a relatively poorer, relatively weaker United States. That is why I called my book Zero-Sum Future.

Now, I know that Bob disputes the idea that there has been a shift in economic power. He says the U.S. share of the world economy has stayed roughly steady at 25 percent. But that is not how I read the figures. The Economist (my old employer) now projects that China will be the world's largest economy, in real terms, by 2018. Writing in Feb. 9's Financial Times, Jeffrey Sachs puts it well:

In 1980, the US share of world income (measured in purchasing power parity prices) was 24.6 per cent. In 2011, it was 19.1 per cent. The IMF projects that it will decline to 17.6 per cent as of 2016.

China, by contrast, was a mere 2.2 per cent of world income in 1980, rising to 14.4 per cent in 2011, and projected by the IMF to overtake the US by 2016, with 18 per cent.

If this isn't a world-altering shift, it's hard to imagine what would be.

I know battles of rival statistics can be mind-numbing, so let me just add that my experiences reporting around the world strongly re-enforce this impression of growing Chinese influence based on surging economic strength. In Brazil, I was told that President Dilma Rousseff was paying her first state visit to Beijing, not Washington, because China -- her country's largest trading partner -- is now more important to Brazil. In Brussels, they talk hopefully of China, not America, writing a large check to alleviate the euro crisis. And, of course, China looms ever larger over the rest of Asia.

This shift in economic and political power has important implications for the world order. A weaker United States is less willing and able to play a leading role in sorting out the world's economic and political crises. There will be no Marshall Plan for Europe. There will not even be an American-led "committee to save the world" as there was during the Asian and Russian crises. And when it comes to the turmoil in the Middle East, the United States was more than happy to "lead from behind" on Libya. Meanwhile, the United States has pulled out of Iraq and is pulling back from Afghanistan. Don't get me wrong. I think it's perfectly sensible for Obama to try to reduce U.S. military commitments around the world, especially given the grim budgetary outlook. But we are unmistakably in a new era. No U.S. president can now say the country will "bear any burden" to secure its goals.

Let me now deal with the questions that you raise. The early stages of the euro crisis feature in my book. Its later stages further strengthen my argument. The European Union is a classic example of an organization built around a "win-win" economic logic. The idea of the EU's founding fathers was that economic cooperation and shared prosperity would create a positive political dynamic. And for 50 years it worked beautifully. But that win-win logic has gone into reverse. Instead of feeling stronger together, EU countries increasingly worry they are pulling each other down. The result is a surge in political tensions inside Europe and, in particular, an outbreak of anti-German sentiment. This has global implications; for one, America's pivot to Asia is posited on the idea that Europe will no longer require attention -- a premise I somehow doubt.

As for the U.S. pivot to Asia, I think it's a predictable and rational response to rising Chinese power. But I'm not sure it will work. America's allies in the region face an interesting dilemma. Japan, India, Australia, and South Korea have their most important trading relationship with China -- and their most important strategic relationship with the United States. Unless China grossly overplays its hand and terrifies its neighbors, over time those economic ties will weigh more heavily than the military relationship with the United States. As a result, China's influence in Asia will steadily increase -- at the expense of the United States.

All this, of course, is posited on the continuing growth of the Chinese economy. So what about those "hints that China's economic growth is slowing down"? I wouldn't be at all surprised. Indeed, I would go further and suggest that both the Chinese economy and the Chinese political system are unstable and crisis-prone. If a crisis hits, plenty of people in the United States and elsewhere will eagerly proclaim that the rise of China was a mirage. They will be wrong. This is a long-term process of huge historical significance, comparable with the rise of the United States in the 19th century. U.S. history should tell you that it is perfectly possible to combine political turmoil with the rise of a dynamic, continental economy. After all, America fought a civil war and still emerged as "No. 1" by the early 20th century.

Finally, you ask about the Arab Spring. It could point in two very different directions. If the Arab world successfully embraces democracy and economic freedom, that will reassert the hopeful narrative of the Age of Optimism, in which democracy and economic freedom are spreading around the world and building an increasingly cooperative, liberal, international order (John Ikenberry's world, if you like). Over the very long term, I am still hopeful this is how the Arab Spring will pan out. Over the next decade, however, it seems to me more likely that the Arab Spring will play into the darker narrative of an Age of Anxiety, which is characterized by failed states, cross-border conflict, the rise of illiberal and anti-Western ideologies, and mass migration by displaced people.

As for my dream reader, I don't think I will be able to trump Obama. But if I'm honest, my book is stronger on description than prescription. The phrase "zero-sum future" is meant as a portrayal of a likely destination, rather than a recommendation. In fact, a willing embrace of zero-sum logic would be dangerous. The broad response I recommend involves concentrating on rebuilding U.S. domestic economic strength and attempting to defend the principles of a liberal world order, while hedging against the rise of authoritarian world powers. Broadly speaking, I think that is the policy of the Obama administration.

So rather than nominating an ideal reader, let me finish by telling you about an actual reader. I recently met a European commissioner who is right at the center of the euro crisis. He told me he had read my book and found it interesting -- before adding, "My job is to prove you wrong." Given the gravity of the crisis facing Europe and the West, I hope he succeeds.

Drezner:

Dear Gideon and Bob,

Thanks for your response, Gideon!

To move the ball into Bob's court, a few queries. In his response, Gideon suggests your data on the persistence of American power are somewhat off. He's not the only one; Robert Pape made points like this a few years ago in the National Interest, and Edward Luce has made similar points this week in the Financial Times. Without going too far down the rabbit hole of data, alternative data series can probably be arranged that show a more secular U.S. decline since the 1960s. How crucial is this data question to your overall argument? More generally, what about going forward? Gideon's point about China is well-taken; even if it does suffer a growth slowdown, would that necessarily slow down its eventual rise? The United States suffered some serious depressions during the late 19th century and still became the world's leading industrial power.

Gideon's response highlights another brewing problem with American primacy: Even if the United States is not declining, its long-standing allies are in serious trouble. America's NATO allies are entangled in a sovereign debt crisis, and Japan has its own demographic issues. There are other allies, but as Gideon notes, they have become highly interdependent with China. There are rising states that might share American values -- Brazil and India, for instance -- but it's far from clear whether their alignments with the United States will be anything more than tactical. Without supporters, can the United States still lead?

Finally, we know Obama has read the New Republic excerpt of your book. Has Mitt Romney? I'm curious because a) you're a foreign-policy advisor for him, and b) the Republican presidential candidate's rhetoric on this point -- that Obama believes in American decline, while he believes this will be an American century -- seems at odds with Obama's embrace of your argument.

Cheers,
Dan

Robert Kagan:

Dear Dan and Gideon,

Many thanks to you both for this lively and important discussion. I'm glad Obama mentioned the excerpt from my book, not only for the obvious reasons, but also because he has kicked off a genuinely useful debate about the relative position of the United States and other powers in the international system. We seem to have slipped into a "post-American world" a couple of years ago without much rigorous analysis of whether that was really a good description of the international system. I believe it is not.

First, those GDP figures. My argument that the U.S. share has held fairly steady with roughly a quarter of world GDP since 1969 rests on the U.S. government's figures, which can be found here.

Anyone who takes the trouble to look into this question quickly discovers that, of course, the numbers are a bit all over the place. The IMF's own numbers are constantly changing, even in regard to the past. For instance, as I wrote in response to Luce and Sachs, according to the IMF's 2010 World Economic Outlook report, the U.S. share of world GDP based on purchasing power parity in 1980 was 22.499 percent. In 2007, the last year before the Great Recession, the U.S. share was 21.289 -- not much of a shift. In its 2011 report, however, the IMF put the share in 1980 at 24.6, making the shift seem greater. Which is right? As for the IMF's projections, can we wait and see how they turn out before building an entire global theory around them? They are constantly revising those up and down, too, and things may look different when the United States pulls out of its recession.

But how much weight should we put on this statistic in any case? Some, surely. There is no question that as China's share of the global economy grows, Chinese influence will grow in some respects as well. But I find it remarkable that in so many of these discussions, those who point to China's growing GDP share neglect to mention that China's per capita GDP is a fraction of that of the United States and other leading economic powers. Per capita GDP in the United States is over $40,000; in China it is a little over $4,000, roughly the same level as in Angola and Belize. Even if optimistic forecasts are correct, by 2030 China's per capita GDP will still be only half that of the United States, roughly where Slovenia's is today. It is interesting to contemplate what this might mean if China were to become economically dominant, because it is historically unprecedented; in the past, the world's dominant powers have also been the world's richest.

As a matter of geopolitics and power, the size of a country's economy by itself is not a great measure. If it were, then China would have been the world's strongest power in 1800, when it had the largest share of global GDP. So the next question is whether China can translate its economic power into geopolitical influence. Again, it will undoubtedly do so to some extent. But power and influence do not stem from economic strength alone, and China is already the best proof of this. Over the past couple of years, as the U.S. economy has been slumping and China's has been booming, the United States has significantly improved its standing in East Asia and Southeast Asia, while China's position has deteriorated. In fact, the more China uses its newfound muscle, the more it sparks a reaction in the region, which then looks to the United States for succor. (This was the key insight of William Wohlforth years ago in his brilliant essay, "The Stability of a Unipolar World.") Gideon keeps predicting that Japan is about to tilt toward China, but all signs point in the opposite direction -- and not only for Japan but also for most of China's other neighbors. The fact that China is the top trading partner of all these countries does not necessarily increase China's clout. I gather that even Brazilians are increasingly unhappy at becoming merely a raw materials provider to the Chinese. No economy in the world is more dependent on China than Australia's, but look at the new U.S. base the Australians just welcomed onto their soil. Trade does not necessarily breed comity or strategic dependence. As many have pointed out, in 1914 Germany and Britain were each other's largest trading partners too.

China, in fact, has significant obstacles to overcome before it can become a global power on a par with the United States -- above all, the fears and suspicions of neighbors who are themselves pretty powerful and, in the case of India, rising almost as fast as China. It is a cliché, but the United States really was blessed with a favorable geographic situation. It has no great powers in its hemisphere and faces no direct threat from any of its neighbors. China is surrounded by past and future adversaries. Even the Soviet Union was in better shape during the Cold War.

This in part answers Dan's question about the state of America's allies. That India and Brazil may not move in lock step with the United States is not all that important. U.S. influence does not derive from being able to tell everyone what to do all the time; it never could, even in Europe at the height of the Cold War. Rather, it is the overall balance of influence in the world that helps determine America's position. In a future where the United States and China are likely to be competitors, a powerful India strengthens the American hand no matter how friendly New Delhi and Washington may be.

As to Europe, let's take a broader perspective, please. Compared with the devastated Europe that the United States inherited as an ally in 1945, today's Europe, even with its economic crisis, is a mega-superpower and a very fine ally to have, indeed.

Rachman:

Dear Bob,

I agree with you on one important point. Political power and economic weight are different things. That is why -- even if China becomes the world's largest economy around 2018 -- the United States will continue to be the world's dominant political power for a while. America's network of alliances, military strength, technological prowess, "soft power," political stability, and geographic position are all assets China lacks.

That said, even though political power and economic size are not the same thing, they surely are closely related. So as China becomes wealthier, its geopolitical power grows and becomes much more of a challenge to America's. China's growing wealth gives it more money to spend on assets abroad, foreign aid, and its military. Above all, the lure of Chinese investment and the Chinese market become a powerful tool to shape the behavior of other countries. You can see this with Europe right now. China's ability to supply credit and juicy contracts is making Europeans significantly less willing to confront China, whether on human rights or the environment.

That is why I find your point about GDP per capita less than reassuring. Yes, it is true that the average American will be richer than the average Chinese for decades to come -- perhaps forever. But Luxembourg's GDP per capita is already considerably higher than that of both China and the United States. This does not matter geopolitically because there are so few people in Luxembourg.

To a great extent, this is about simple arithmetic. Japan was never going to be "No. 1" because its population is less than half that of the United States. China is almost certain to be No. 1 in economic terms because its population is four times that of the United States. You are right that the relative poverty of the average Chinese citizen will make China an unfamiliar sort of superpower -- simultaneously richer and poorer than us. This could make China relatively introverted, or it could make it more aggressive as it seeks resources to fuel its rise and satisfy the aspirations of its population. For me, the biggest question mark over China's rise is whether the coming of democracy (if it arrives) will provoke the country's breakup, especially as separatist movements gain momentum in Tibet and Xinjiang. But even though these areas represent a big chunk of Chinese territory, they account for only about 2 percent of the population.

Furthermore, it is not just China that faces troubling questions. You are right to point out America's enduring strengths. But the rapid growth of the U.S. national debt raises the prospect of a really nasty fiscal crunch. When it comes to sovereign debt, we in Europe have just discovered the truth of that old economists' joke that "things that can't go on forever, don't." The United States cannot continue running up debts at its current rate. And even a controlled, rational effort to manage the debt will have serious implications for U.S. spending -- and deployable power.

I agree that the balance of power between the United States and China will depend to a huge extent on the choices made by other countries. You are right that I was probably overimpressed by the Japanese tilt to China under Prime Minister Yukio Hatoyama. That proved to be transient. Nonetheless, it was an interesting episode because it underlined a central point about the emerging world order. As China grows more powerful, the United States cannot assume that traditional allies or fellow democracies will cleave to America. In the last U.S. presidential election, the candidates did a lot to promote the idea of a "league of democracies." But in the intervening four years, we have seen that democracies do not always stick together. At the climate change talks in Copenhagen, Brazil, India, and South Africa were on China's side, not America's -- their identity as developing countries trumped their identity as democracies. The same countries condemned the recent NATO-led intervention in Libya as it developed into a real military campaign. Their suspicion of Western intentions trumped their support for human rights.

In the battle for hearts and minds around the world, America's identity as the world's leading democracy will be a big asset. But China's ability to capitalize on widespread resentment of centuries of Western domination should not be underestimated.

America is still way ahead when it comes to hard military power. But I think it is unlikely that China and America will ever go to war. It is economic strength -- not military power or "soft" power -- that will matter most in the contest between the United States and China. And the moment when China pulls ahead of America in economic terms is, I'm afraid, approaching rapidly.

Kagan:

Dear Gideon,

I'm afraid we have landed on a wide swath of common ground. We both agree that the United States will remain the predominant global power and enjoys distinct advantages over China "for a while." We both agree, as well, that China may present a formidable challenge in the years to come, one that may tax American capabilities and American wisdom. The United States faces serious problems at home -- not least the enormous fiscal deficits driven by entitlements -- that erode its ability to continue playing its vital role in the world. We are already seeing the effects on the defense budget, which, despite the fact that defense cuts will make scarcely a dent in the deficit, is being sacrificed to political expediency. Those who doubt the effects of these cuts need only look to Asia. The administration has announced a strategic "pivot," but whether it will be able to make good on its renewed pledge to provide security to those feeling threatened by China remains to be seen.

The main point of my book, in fact, is to examine what might happen in the world should the United States prove incapable of continuing as the predominant power and slip into a rough equality with other powers, like China. I'm afraid it is optimistic to believe that China will pose only an economic challenge to the United States under those circumstances. The effects of a new multipolar world will be far-reaching. I sometimes think we have forgotten how countries behave as their power increases. We have been living so long in a world where one power has been so much more powerful than all the others. The existence of the American hegemon has forced all other powers to exercise unusual restraint, curb normal ambitions, and avoid actions that might lead to the formation of a U.S.-led coalition of the kind that defeated Germany twice, Japan once, and the Soviet Union, more peacefully, in the Cold War.

The Chinese, as good historians, are acutely aware of the fate that befell these others and have worked hard to avoid a similar fate, following as best they can Deng Xiaoping's advice to "keep a low profile and never take the lead." As relative power shifts, however, that advice becomes harder and harder to follow. We saw some early signs of what the future might hold in China's increasing assertiveness in the South China Sea. The response of the United States, which swung in behind the nervous powers in the region, has possibly convinced the Chinese that their moves were premature. They may have themselves bought in too much to the widespread talk of America in decline. Were that decline to become real in the coming years, however, it is a certainty that Chinese pressures and probes will return. Greater relative power on China's part might also lead Beijing to become less patient with Taiwan's lack of movement toward acquiescing to the mainland's sovereignty. A situation in which U.S. power were declining, China's power were rising, and the Taiwan issue became fractious is practically a textbook instance of how wars start -- even if neither side wants war. That is why some have referred to Taiwan as East Asia's Sarajevo.

If our only problem were that China was going to become more influential in the economic realm, while the United States retained dominance in all other realms, this might be manageable. I don't mind if the Chinese buy Rockefeller Center. I hope they get as good a deal as the Japanese did in 1989. The danger is that the United States may decline relative to China on all measures of power. That would spell the end of the international order the United States has supported and benefited from since the end of World War II.

I remain optimistic, however, that the United States will address its problems, as it has in the past, and that China will discover bumps in the road ahead, as it has in the past. In the meantime, it is important that the United States work to preserve its leading position in the world and not succumb to a declinism that becomes a self-fulfilling prophecy.

Drezner:

Dear Gideon and Bob,

Thanks for your responses. I hereby declare myself to be a uniter rather than a divider when it comes to moderating exchanges, thereby guaranteeing that The Powers That Be at FP will never ask me to do anything like this ever again.

If we step back, debates like these often tend to revolve around what the known unknowns are, and for Western commentators, what's unknown is China and its neighbors, rather than the United States. The international relations theorist in me also sees some irreducible questions about the future. Will a China that possesses a huge market size but is comparatively poorer per capita care more about absolute gains or relative gains vis-à-vis the United States? Will China's close and distant neighbors balance against a rising power or be trapped by interdependence into a more accommodating posture? What lessons will China draw from the aftermath of its more bellicose foreign policy turn in 2009 and 2010?

I look forward to hearing your answers to these questions in the ensuing years.

Save big when you subscribe to FP.

THE_OBSERVER

7:25 PM ET

February 14, 2012

Decline and Fall

America's situation is very similar to that of the decline in the Roman Empire in the 4th century A.D. An empire grown tired and expansion halted, battling external enemies knocking on the door, using mercenaries in battle campaigns, rear-guard battles with internal dissent, the rich evicting the poor from their homes including those of soldiers serving the empire, sops in terms of games to distract an ever more disgruntled population, etc. The result was that the Roman Empire split in two. Is that the future for the USA???

JESPER SOEGAARD

5:09 AM ET

February 16, 2012

multipolar system is approaching

To be honest I don't care much about the current situation with the possible decline of the US. What's interest me is the movement from a monopolar power to either a binary system with the US and China or the multipolar system, where we may see India, the EU and others all catching up with each other. I fear the multipolar system as it creates a fierce battle for power. Much tougher than a situation with one natural monopoly power as the US right now.

Should I give some [url=http:// www.bettingexpert.com/betting-tips]betting tips[/url] as to where we're heading and which risks may follow, I'll definitely keep my eyes in the direction of China. The question is how the balance of economical vs military power will be weighed in the future. US will surely be the strongest military power for a very long time, but it's just a matter of years, before it won't be the strongest economy in the world and what will happen then?

5:21 AM ET

Should I give some betting tips as to where we're heading and which risks may follow, I'll definitely keep my eyes in the direction of China. The question is how the balance of economical vs military power will be weighed in the future. US will surely be the strongest military power for a very long time, but it's just a matter of years, before it won't be the strongest economy in the world and what will happen then?

PSANDS

11:51 AM ET

A DIFFERENT ROLE

Both arguments in this debate are obviously carefully researched and presented. A kind of , the cup is half empty or full. America does have a changing role on the world stage. America and the entire world are clearly on the brink of, if not in, tumultuous change. A new and realistic view does need to be taken and the right choices made. Decline is not inevitable and neither is supremacy. Go to www.barbaralacy.org to see what this rising new Independent candidate has to say about the future and those choices for America in a different world. Barbara Lacy for President..she broings what the nation and the world need now!

FAIR AND BALANCED FREDRICO

3:38 AM ET

February 18, 2012

Cheney/Bush - The Truth is Out

During 9/11 Boy George was reading "My Pet Goat" to children, while Dead-Man-Walking Cheney was was at the scene of the crime (in the White House bunker) conducting scheduled, simulated war-games to fool NORAD and the FAA into standing down. Isn't it time we put these guys on trial for treason and mass murder?

JRACFORR

9:18 PM ET

The title of this article is

The title of this article is a bit misleading because the American empire has not yet begun.We are still in the early stages of America's growth so the end is not yet upon us. Nevertheless we are presently in great danger and significant change will overtake the country. If we use Roman history as a benchmark to evaluate America's progress, we will find that America is currently experiencing the growing pains of the Roman Republic.In this era Rome's elite had to accept the growing political power of the poorer class as well restrictions on the manner in which it used it's wealth. The Roman elite could not purchase endless acre of farmland for speculative purposes as this drove up the cost of food. We in America will soon witness this control, as excess capital from wall street seek safety in a new round of farmland speculation. We are approaching the era of " ROME"S SOCIAL WAR " and the end of the REPUBLIC, but the Empire phase of the American experience is decades away. America is like a tree about to lose it's leaves in winter but they will grow back in the spring, then and only then will the AMERICAN EMPIRE begin.

THE MIGHTY CYNIC

9:17 AM ET

February 15, 2012

Where were you when we had 100s of bases around the world?

And looted resources for domestic consumption? Look up the world imperialism and get back to us.

LEONIDASLEONIDAS

7:30 AM ET

A very interesting comment

I don't agree with all your points, but I do agree with the general idea.
It's certainly a refreshing take on the matter.

NELSONROSE

2:43 AM ET

American power and economy growth

In this passage Bob is talking about the American power and economy growth which is going and down and is not a very good news for America. Because America is a country which has a tag of developed country. For maintain this they have to do a lot of hard work. Due to some financial problem I have to sell the car for cash which was my loving one.

3:11 AM ET

TRUTHFUL

6:30 AM ET

Gross Domestic Product

GDP is a measure of "market value" of goods and services produced within the country. As such, it underestimates "true" income if the nonmarket transactions are large. In 1980 China still was largely a closed, socialist economy. Thus, 1980 Chinese GDP should be taken with a grain of salt. To use that figure for any comparative study is misleading. Today, Chinese economy is more open and market oriented. Hence, it is quite possible that what was not measured in 1980 GDP is now being counted. GDP statistics is like crime statistics; the increase in it could just be because it is now accounted.

China has benefitted enormously from the liberalized world trade regime in 1990s. Indeed, at the core of Chinese rapid growth lies this unreciprocated easy access to western markets for its exports. Of course, this asymmetry in the abilities has created a large imbalance in trade between China and the US which can not be sustained. The trade between countries is strategic; it is sustainable only if it is causing mutual interdependencies. For how long would the US be willing to accept this if it is not reciprocated by China economically or politically. The liberal world order does not just imply political liberties; it also means liberal trading regimes among nations. I do not think Chinese will kill the goose that lay the golden egg.

6:40 AM ET

American Intransigence

Actually, Australia, Germany, Switzerland, S. Korea and Japan all run trade surpluses with China. This is because they sell what China wants. The US restricts Chinese investments in US companies and restricts high-tech goods that China wants to import. And you wonder why the US runs a deficit with China.

CONCONS1224

6:49 AM ET

Undiscussed Factor

What about the the huge political and social differences between the rising US and a rising China? One of the reasons for America's rise as the world's leading power was the fact that she had a free, democratic, and relatively politically UNITED society. The average person looked favorably toward the government and believed he could rise socially on his own strength, unhindered by an overly powerful political class. Contrast that with China today. Does China have that same freedom and unity that were and always have been marked characteristics of the United States during it's rise? Hardly. China has an authoritarian government which cannot trust it's own people and which must constantly crack down on political discord. How can this be a stable foundation for a rising world power? As China's own ancient military classic, The Art of War, says: "Humaneness and justice are the means by which to govern properly. When government is carried out properly, people feel close to the leadership and think little of dying for it." But if there is no humaneness and justice, what then?

BETALOVER

4:20 PM ET

Strawman

I think you are 70% wrong.

" One of the reasons for America's rise as the world's leading power was the fact that she had a free, democratic, and relatively politically UNITED society." You are right, one!
At least one other is that the virulently rascist country successfully usurped the most splendid continent on earth. The third reason is that it made good use of it after ursurpation and did not have to repay any.

China has plenty of unity and no fewer percentage of Chinese people look favorably toward their government than that of Americans favorably at Uncle Sam.

The USA does have less unity than China. Please open your eyes about American unity. We still have the great racial divide and political divide is growing. The racial divide is under arrest, not expanding, I'd agree, but it exist very much and very influentially in American life.

The Tibetans and China's other minorities are like our Slavic peoples from a few decades ago. Racial similarity will allow assimilation seamlessly after a few generations. For the Chinese it will be more Hans; for us the white melting pot has expanded with the Slavic integration. Who is Natalie Wood? She was Russian. With just a name change she became Anglo-Saxon. What is a Chen? She may be Tibetan! Same reason.

many Chinese feel a lot of justice. that is China finally has resurged after more than a century of Western injustice upon them.

China is free enough to progress economically and culturally, I might say, not always the form of culture that the West aspires on behalf of China.

NICOLAS19

8:35 AM ET

February 17, 2012

look through the gates of your community

Unity is a different thing. Sure, if you only inform yourself via US newspapers (or FP), you read nothing but articles about China's dicatorship/crises/fragmentation/pollution/whatever the elites want you to believe. Not necessary true.

Now riddle me this about unity: assuming you're a 'standard', traditional American, a WASP, what you you have in common with a Hispanic dishwasher from San Diego? an Afro-American janitor from LA? a farmer from Iowa? a banker from Wall Street?

ENIGMA

11:02 AM ET

Hilarious

"Where you both seem to agree is on the necessity of American power to ensure global order and prosperity."

We have ensured global order and prosperity? Is that a joke?

8:36 AM ET

spot on

Thank you, dear US-made banking crisis for the global prosperity! we really needed you!

KINGFELIX

Well... what can you expect from these guys?

"Robert Kagan is co-founder with William Kristol of the Project for the New American Century."

ALEXBC

6:05 PM ET

"That is why I find your point about GDP per capita less than reassuring. Yes, it is true that the average American will be richer than the average Chinese for decades to come -- perhaps forever. But Luxembourg's GDP per capita is already considerably higher than that of both China and the United States. This does not matter geopolitically because there are so few people in Luxembourg."

This is terrible argumentative logic.

Comparing Luxembourg to the United States is an unhelpful exercise; the U.S. has 760x the population of Luxembourg, whereas China has only ~4x the population of the U.S. right now. If current demographic trends continue, also, the ratio of Chinese to American population will actually get narrower, not wider (only 3x more by mid century, for example).

Michael Beckley seems to have already preempted your point about GDP:

"This is not to say that size is irrelevant. Luxembourg’s per capita income is
almost double that of the United States, but its tiny population precludes it
from raising a meaningful army, let alone entering the ranks of the great powers. It is, however, important to recognize that GDP is not synonymous with
national power, and that countries with larger economies do not necessarily
have more resources at their disposal. Half a billion peasants will produce a
large volume of output, but most of it will be immediately consumed, leaving
little left over for national purposes. As Klaus Knorr argued, what matters for
national power is not wealth, but “surplus wealth.” It is therefore significant
that the average Chinese citizen is more than $17,000 poorer relative to the average American than he was in 1991."

URGELT

5:30 AM ET

Missing Analyses

I'm afraid I can't take either gentleman very seriously, at least not on the strength of their writing for this article. Their analyses are severely constrained in order to support their arguments. The apparent and projected decline of American power has deeper roots than either have acknowledged, and because they have not acknowledged them, they shed little light on planning for our future.

First, let me caution that economics is not a zero-sum game. It never was. I realize that zero-sum isn't precisely the takeaway from our distinguished authors, but this needs to be nailed down tight. Cooperation can yield growth between trading partners if the playing field is level. Win-win is an obtainable outcome. This should be an obvious point: mineral resources are distributed unevenly among countries, for example, so trade evens distribution and improves economic output between partners.

Now let me itemize some points that are either left unaddressed by the authors in their argumentation, or merely subjected to drive-by glances.

1. The playing field isn't level. China has underslung its currency against the dollar and refused to let it float on world markets. China has also made it very difficult for foreign companies to sell their products in China with all sorts of unusual tactics, such as insisting that the goods be manufactured in China in partnership with Chinese companies, or insisting that intellectual property rights be transferred to Chinese companies, or presenting regulatory hoops which can't be jumped - while we have made it very easy for China to sell its products in the US with almost no reciprocal disadvantages. These factors are hugely, though not solely, responsible for their trade surplus and the US trade deficit. They have resulted in a hollowing-out of industrial production in the US, whose capitalists have consoled themselves with a rapid rise in its service sector, lower wages, consolidations, outsourcing, establishment of monopolies, and enormous profits. This has been good for wealthy investors, but not so good for the health of the US economy, since the middle class is shrinking and losing purchasing power. It's also bad for tax revenues. Result: a declining trend in US economic strength and power.

2. With the US industrial sector in decline, the US depends more on its trading partners, especially China, to manufacture the goods it needs. Can you see how that increases US vulnerability in the face of conflict with countries which supply, say, integrated circuits and electronic devices we can no longer can make ourselves? This weakness, too, is an outgrowth of an unlevel playing field.

3. Perhaps the single largest factor in declining US power is home-grown: reverse socialism. Government has been co-opted to serve wealthy interests ahead of the nation's interests. Government policies written by lobbyists carve out exemptions, special treatment, government-granted monopolies, criminal enforcement of intellectual property (this last is a very new idea, and a dangerous one), a patent system that is frankly out of control and generating debilitating litigation, not to mention barriers to entry into markets and stifling competition. Tax breaks targeting the wealthiest citizens and corporations, taxpayer bailouts and grants and guarantees for corporations which benefit their owners, a two-tiered criminal system (one for the wealthy and one for everyone else), all sorts of mechanisms like these are now being used to cause wealth to flow to the top using government power to get it there. Lobbyists have become so successful in dominating elected politics at all levels, it's not far-fetched to call them our real rulers. Business plans now avoid competition and seek collusion with government, knowing profits (though not innovation or price) will be better if they succeed. The upward flow of wealth, the shrinking middle class and enlarged ranks of the poor, all a direct consequence of government using its power to direct the flow of wealth upward, harms the overall economy and sends us on a downward trajectory. When governance is made to resemble that of a corrupt banana republic, it should be no surprise that the economy follows suit.

4. Consolidation of the defense industry into a few giant contractors has contributed to loss of competition and higher prices for military systems, which means fewer can reach soldiers, sailors and airmen. But that's not the worst of it. The worst is the DoD acquisition policy now permits production to proceed long before a system is meeting its design parameters in testing. This results in: a) vastly more design changes impacting system cost; b) expensive retrofitting of critical changes to already-built systems; and c) necessary insertion of expensive contractor logistics services to handle work that once was done by servicemen and women (they can no longer do it because with critical changes being made to systems long after they are fielded, training and publications never reach them). These practices are a big part of why the F35 or the Navy's Littoral Combat Ships are experiencing runaway costs and performance problems. We're already launching LCS but have yet to finalize designs that pass testing for basic functions such as mine-clearing operations! The risk is enormous, and correcting for deficiencies is expensive as hell when the production line started years earlier. DoD adopted these rules at the urging of defense contractors, who saw an opportunity to generate profit faster. It worked. Defense contractors are making vast sums. But it's not so good for the projection of American power.

5. Peak oil has an influence. Some experts assert that peak oil came and went in 2005. Whether that's true or not, it's incontrovertible that energy costs are both volatile and experiencing long-term growth relative to other commodities. This is important. Our economy needs cheap energy to be robust; in the absence of it, we'll see a decline. Less developed nations are less affected, at least in the near-to-mid term; they're relying more on human labor and less on energy than the US.

6. As a percentage of GDP, the US health care industry has soared. There are only two likely explanations for this trend: a) Americans are sicker; and/or b) monopoly market power is on the rise. There is evidence for both explanations. Need it be said that monopolies are economically stifling? Competition is key to robust economies, but consolidations and ever-stranger stretches of patent law have created and enforced monopolies more in this sector than in most. But it's also true that Americans are sicker. Longevity improvement has stagnated relative to other industrialized nations. Heart disease, cancer, Type II Diabetes and many other illnesses have exploded. We do not need to spend time arguing about the causes here (though it's an interesting topic); we only need to acknowledge that American health is in decline, per capita health care costs are grabbing a bigger share of the GDP, and that's reducing the competitiveness of the American worker and sucking up GDP which could be better used in other sectors.

7. I will argue that one of the trends provoking downward economic strength in the US is the direction in which our mainstream media have been evolving. We're seeing less actual reporting, more entertainment news, more sports. And, not to paint a smiley face on it, more lies. The citizenry is starved for facts, starved for analysis, but instead is fed opinions which comport with the interests of the elites. Candidates aren't pressed at all on the issues; we've turned our elections into beauty contests, where beauty is molded by advertising money. Democracy is weakened by the abdication of the fourth estate in favor of marketing and cheerleading for entrenched elites. With citizens ill-informed, the legitimacy of the government itself is weakened, and that fact has international implications.

8. Hand-in-hand with the corruption of media, our educational system has also deteriorated - except for education which targets the children of the elites. For the rest, our education solutions have been hilarious to the world community. You can't test an education into a child's head, and we have forgotten that a liberal education was once more about teaching children to reason and love learning than to memorize accepted wisdom and to believe it. With mainstream media failing to explain the issues, with education having reoriented itself to teach bland, unchallenging curriculae and relentlessly test for its acceptance, with innovative teachers coming automatically under fire as though they were practicing witchcraft, our citizenry's competence at reasoning and learning has fallen, both in the estimation of other nations and in our own. This trend has encouraged corporations to outsource to get better workers and is a drag on our economy.

9. Criminal fraud has been institutionalized and almost entirely protected in the real estate and financial sectors. This is hugely destabilizing and harmful to our economy, and it's not done hurting us, not by a long shot.

I could go on: The Fed's currency gushing over the past thirty years and the devastating impact that's had on savings, our unfunded wars, our neglect of infrastructure, privatization and mismanagement of government functions, the hugely expensive and utterly futile war on drugs, Washington gridlock and the culture wars... we're a nation trembling from the effect of its many self-inflicted wounds. But this comment is already too long, so I'll be (slightly) merciful.

My point is that our esteemed authors are not even beginning to tell the story of America's decline on the world stage. They're just hitting points that support their arguments, and, sad to say, I view those arguments as supportive of the status quo rather than challenging it or attempting to encourage reforms. Without reforms, it's a safe bet we'll continue on this downward path to reduced relevance on the world stage.

Economics can never be just about economics. With the blinders on, there is no truth in it. Governance, laws, treaties, regulations, politics, education, health, it's all mixed up in it when we attempt to explain large trends in economics. The trick is to accurately see the big picture and, when something goes wrong, to be able to point to the influences responsible for it. That's especially important now, because something is definitely going wrong, and our nation will suffer gravely for it if we don't accurately assess the causes and begin to fix them.

4:39 PM ET

China: Size and history of underachievement

I believe the most fundamental about China are its size and recent history of underachievement.

Therefore, I believe China will grow much more still.

The size is obvious. China is 11 tens Japan.

It is not difficult for them to achieve 20-30% per capita GNP as that of the USA. This is because China used to be rather productive. The West had robbed China for over a century, yes, but they have also shot themselves at the foot. One can suggest that the shooting at its own foot was under the duress and an irrational response to foreign aggression.

We are no longer as virulently racist and they have stopped shooting themselves at the foot. So what is the natural consquence? Resurgence!
To a great part, China's resurgence is really this simply.

China's growth will continue as we will not be as virulently racist again and they will not shoot themsleves in the foot again. I think this is the basic thrust of the current situation re China. China almost certainly will be a great economic and military power. There is nothing to do to stop it from being so. It has a lot of constraint still, so I am not worried.

Taiwan will be another Hong Kong, Tibet and other parts of China will assimilate seamlessly, trade with China will have to be stable. Why can't we get along with such a China. Seems to me that what is happening is already good, better if we won more in trade, but otherwise the best that can be expected is already happening re China.

RPRIETO

1:41 PM ET

Interesting, but I don't completely agree

I hear people say America is in decline. While I do see several industries that used to be primarily American going elsewhere, there are some that are still going strong. A perfect example is the manufacturing of solar panels. We used to manufacture then right here in the U.S,A., but now they're being manufactured overseas for a much lower cost. It's mostly because of the much lower cost of labor.

However, when it comes to a lot of the high end engineering for new technology, it seems to me that a good deal of the innovation is still coming from America.

Overall, I'd say that URGELT has a very good comment on the economics side of things and agree with a good deal of his/her input. The situation in which we now find ourselves doesn't have ane easy fix and it won't be painless.

VALICORE

2:18 AM ET

China and the US are inextricably linked.

America is in decline, America is in decline, the sky is falling, America is in decline!

No, I don't see that, not yet at least... the country is at serious risk of decline, but despite the proliferation of Chicken Littles, we've got a long way to go! Take China (aka the boogyman according to how some people talk about it):

China's growth is dependent in large part on American consumers buying the cheap goods produced in China... a decrease in the American economy and of its worldwide stature would lead to a reduction in consumption which means less need for production in China leading to less jobs, and with a real estate bubble already emerging, highly lackluster domestic consumption and an economy that requires the production of 10 - 12 million new jobs every year just to maintain the current employment rate, if America falls China is bound to follow... that of course is without even mentioning workers' demands for higher wages, better working conditions, and the growing discontent with slave-class producing hukou system.

US power and influence are changing, and so the US has to start thinking a of itself a little bit differently than it does now, it needs to be a little bit more real with how it presents itself to its citizens. That said, America still has innovation, we still have top class universities, and we are still very productive and still have many of the strongest and most influential companies in the world.

MLSMITH73

7:01 PM ET

February 23, 2012

Becoming strong again

It seems like one of the only ways that the USA can become financially strong again, and be revered, and respected again is with another great technological breakthrough, but that may not happen again for another decade or so. Hard to say.

ALIFELIX

12:04 PM ET

March 5, 2012

Become More Educated

The remain a top player in the world, Americas have to continue to seek out higher education and foster more valuable skills. The country can't compete on a pure manpower basis due to its relatively small population compared to countries like India and China, but can stay powerful by producing innovative and highly skilled individuals. A company like Apple is a great example of America's future. For their next great product, the iphone 5 2012, all the design and business strategy is done in the US, where most of the labor and tedious work is done overseas. Personal is also needed in the US to coordinate all the efforts overseas. The more skilled and educated US people become, the more stable USA's future is.

Foreign Policy Magazine

Inside National Security

Tackling the great decline debate.

BY DANIEL W. DREZNER, GIDEON RACHMAN, ROBERT KAGAN | FEBRUARY 14, 2012

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