Can you guess the source?
I shall argue that it is high time indeed that we pay much more attention to the sociology of international studies, and especially to the reasons why one particular myth -- that of America's lost hegemony -- took root so strongly in the United States academic community about fifteen years ago and why it has been so generally and unquestioningly accepted since-so much so that it has even gained credence in the world beyond North America. ...
In its extreme form, the myth that the United States today is just a little old country much like any other and has, in some sudden and miraculous way, lost its hegemonic power may seem more plausible than do some of these other myths. But when it is subjected to close and searching scrutiny, it is just as far from truth. And unless cool and rational analysis undermines its power to move minds and shape attitudes, it can be every bit as dangerous. In living memory, the optimism of the United States gave Americans and others a vision of a new, better and attainable future for the world; today, the myth of lost hegemony is apt to induce in everybody only pessimism, despair, and the conviction that, in these inauspicious circumstances, the only thing to do is to ignore everyone else and look after your own individual or national interest. Thus, some of the same American contributors to International Organization who are personally persuaded of the benefits of more international cooperation and conflict resolution, may paradoxically be contributing to a less cooperative environment by subscribing to and perpetuating the myth of lost American power.
That is Susan Strange, in her 1987 IO article "The Persistent Myth of Lost Hegemony" (ungated), which I just read for the first time. It's very good, and certainly still relevant twenty-five years on.
She argued (contra Krasner, Keohane, and others) that the U.S. in the mid-1980s was still a hegemonic state, because it controlled the four elements of structural power (which she distinguishes from relational power):
1. The ability to deny or increase other peoples' security from violence.
2. The ability to control the system of production of goods and services.
3. The ability to determine the structure of finance and credit, and therefore acquire purchasing power without producing or trading for it.
4. The ability to influence knowledge creation, whether technical or ideological, and the ability to acquire, communicate, and store that knowledge and information.
Strange argued that by those four metrics, the US was clearly a hegemonic power in the mid-1980s. Here's what she wrote about the US's persistent current account deficit:
Indeed, to run a persistent deficit for a quarter of a century with impunity indicates not American weakness, but rather American power in the system. To decide one August morning that dollars can no longer be converted into gold was a progression from exorbitant privilege to super-exorbitant privilege; the U.S. government was exercising the unconstrained right to print money that others could not (save at unacceptable cost) refuse to accept in payment.
How much of this remains true? Arguably the US is at a greater security advantage now than in 1987, and still controls quite a lot of the globe's system of production. The ability to determine the structure of finance and credit is certainly still in the US's hands, and the US is still a global leader in knowledge creation and dissemination. While some countries have narrowed the gap in one or two of these categories, none can challenge across all of them.
Has the subprime crisis changed any of this? It's certainly illustrated aspects of it. It remains to be seen whether the crisis was a transformative event.
But, as Strange noted, previous "transformative events" (such as the collapse of the Bretton Woods system and 1970s economic malaise) ended up not being nearly so transformative as many thought they would be. According to Strange, that's because the structural conditions didn't change.
Strange also argues, prefiguring folks like Zakaria, that international disorder stems from US political instability rather than a decline in capability, which itself is a result of constitutional design (separation of powers, checks and balances), the role of interest groups in coalition-building, and a tendency to suddenly reverse course mid-stream. As Strange put it: "It is not easy for [American academics and policymakers] to admit that the conduct of American policy towards the rest of the world has been inconsistent, fickle, and unpredictable, and that United States administrations have often acted in flat contradiction to their own rhetoric."
It's a very good article.