The United States is going through difficult times. Its post-2008 recovery has slowed, and some observers fear that Europe’s financial problems could tip the American and world economy into a second recession.
The United States government’s National Intelligence Council projects that American dominance will be “much diminished” by 2025, and that the one key area of continued American superiority–-military power–-will be less significant in the increasingly competitive world of the future. Russian President Dmitri Medvedev has called the 2008 financial crisis a sign that America’s global leadership is coming to an end. The leader of Canada’s opposition Liberal Party, Michael Ignatieff, suggests that US power has passed its mid-day. How can we know if these predictions are correct?
The world economy will shrink this year for the first time since 1945, and some economists worry that the current crisis could spell the beginning of the end of globalization. Hard economic times are correlated with protectionism, as each country blames others and protects its domestic jobs. In the 1930’s, such “beggar-thy-neighbor” policies worsened the situation. Unless political leaders resist such responses, the past could become the future.
In his farewell address yesterday, George W. Bush pointed out that America has gone seven years without another terrorist attack on our soil. That is an important fact, but future historians will have to judge the extent to which Bush caused it, and whether it could have been achieved by less costly means. They must also weigh it against the other facts that he leaves two unfinished wars, an economic crisis, and global polls showing a loss of American soft power. Will the enduring icons of the 43rd presidency be Iraq, Guantanamo and Katrina? Or will they be 9/11 and his “freedom agenda?”
President Obama faces a dilemma in foreign policy. On the one hand, he will inherit a legacy he cannot ignore: an economic crisis, two wars, a struggle against terrorism, and a set of problems in the Middle East among others. If he fails to fight these fires successfully, they will consume his political capital. On the other hand, if all he does is fight fires, he inherits Bush’s priorities.
On November 4, Americans will elect their 44th president amidst the worst financial turmoil the country has known since the onset of the Great Depression in 1929. Both candidates are United States senators with little experience as executives, so their ability to manage the crisis has become a central issue in the election.
Is the current financial crisis an indicator of the long term decline of American power? When I wrote Bound to Lead in 1989, the conventional wisdom was that the United States (and its economy) were in decline. I did not believe it then, and do not believe it now.