America's Superpower Status Threatened by Financial Crisis
Robert Roy Britt
LiveScience Managing Editor
LiveScience.comFri Oct 10, 1:33 PM ET
A dismal economy coupled with mounting federal debt and expected cuts to science and technology spending threaten to unseat the United States as the reigning superpower of the world.
Many people around the globe already thought the mantle had been passed, perhaps to China, though that possibility is hotly debated.
Now signs of changing times are more stark, with world leaders frustrated and even angry over a global financial crisis many see as caused by American policy mistakes. Meanwhile the monetary meltdown is likely to force cuts in public and private science and technology investment - a cornerstone of the American economic engine that has historically driven the nation's preeminence.
While opinions on the ultimate outcome run the full spectrum of possibilities, many see a new world order, of some sort, in the making.
"The general perception of the United States as the key base of the world economy is shaken badly right now," said Alan Porter, emeritus professor of the School of Public Policy at the Georgia Tech. "That will spiral into foreigners being less inclined to put their money into our government and companies. And that will lead to less investment and production."
Porter and others also don't see how military spending can continue at such a high level.
"Military might depends upon economic wherewithal," Porter told LiveScience. "We are so stretched now, that this is certainly slipping."
Yale University sociologist Immanuel Wallerstein has been predicting the end of America's global dominance since the 1980s. This week he told the Christian Science Monitor that fallout from the Iraq war and the mounting U.S. debt had accelerated the country's decline, and the current global crisis is just a culmination of these events.
America's superpower status depends on many factors. It was achieved through dominance in military, economic, political, intellectual, technological and cultural realms. Some experts have been saying in recent years that power could shift to those nations with huge emerging economies.
In a survey released in June, the Pew Research Center reported that citizens in many countries think the shift has already occurred:
"Most of those surveyed in Germany, Spain, France, Britain and Australia think China either has already replaced the U.S. [as the superpower] or will do so in the future," according to the report. But historians and other analysts told LiveScience in August, during the Olympics, that such a change had not yet taken place, and many doubted that it would anytime soon.
The current global financial crisis has created an all-bets-are-off feel, however, leaving some seasoned observers to ponder big changes that could emerge when the dust settles.
One unavoidable observation is that money, which equals power to a large degree, is vaporizing faster than you can say "$700 billion."
Anne-Marie Slaughter, Dean of the Woodrow Wilson School of Public and International Affairs at Princeton University, says the perception that New York is the financial capital of the world a false one - and now she's not the only one thinking that way.
"Shanghai is booming, and Hong Kong is booming, and Singapore is booming. London was already growing enormously," Slaughter said this week in an interview with the Council on Foreign Relations. She said neither New York nor any other single city will dominate the financial scene moving forward.
Others are more blunt.
"The USA will lose its superpower status in the global financial system," Germany's Social-Democrat Finance Minister Peer Steinbrueck said recently. "The world financial system is becoming multi-polar."
One big question the next president of the United States will have to deal with is how the nation's money problems play out in military, political and cultural realms. And when it comes to power, perceptions are important, too.
The German magazine Der Spiegel summed up a growing European sentiment in a commentary last week:
"The banking crisis in the United States has shaken many things in recent days, not just the chancellor's [Angela Merkel] affection for America and the respect the rest of the world once had for the U.S. as an economic and political superpower. ... Now, of all times, the world is faced with a preeminent power that no longer seems capable of leading and a U.S. president who is not even able to unite his divided country in an hour of need."
The situation will only worsen, Carnegie Endowment Visiting Scholar David Rothkopf wrote Sunday in The Washington Post: "Already this crisis has seen not just our enemies but even some of our closest allies wondering whether we are at the beginning of the end of both American-style capitalism and of American supremacy."