Dan Drezner is kicking Britain -- and the American foreign policy commentariat -- while they're down. The essay is mostly good, although regular readers of this blog probably won't find much of it new, but I must disagree with part of his conclusion:
There is no denying that the relative power of the United States is less now than it was a decade ago.I think that is deniable. A decade ago the U.S. had alienated many of its allies, the United Nations, and all of the BRICs by invading Iraq with a "coalition of the willing" led by a president which half of the country believe did not actually win the 2000 election. Some suggested that American democracy was at risk at home, while its foreign partnerships -- especially NATO -- were similarly endangered. A decade ago the U.S. was still recoiling from the 9/11 attacks and was braced for a very dangerous future. A decade ago the European Union was resurgent, Iran was less isolated (and more recalcitrant), and China was building up its "Beijing Consensus". All of the talk in IR/FP circles was about decoupling, anti-American balancing, the end of legitimacy of American economic leadership via multilateral institutions like the IMF, WTO, and World Bank, and the end of security leadership via the UN and NATO. For all of George W. Bush's posturing, the U.S. faced some very severe challenges, and handled almost all of them pretty poorly.
Some of these persist, but Drezner is correct to note that at this point all of the potential challengers to U.S. primacy have faltered, while the U.S. is picking itself back up. We're talking about "relative" power, remember, so let's just ask who is on the other side of the U.S. in this equation. The E.U.? The BRICs?
Sean Starrs has a very interesting paper out on "early view" in International Studies Quarterly making the case that American economic superiority hasn't slipped at all since the crisis. Here's the abstract:
This paper argues that a fundamental failing in the debate on the decline of American economic power is not taking globalization seriously. With the rise of transnational corporations (TNCs), transnational modular production networks, and the globalization of corporate ownership, we can no longer give the same relevance to national accounts such as balance of trade and GDP in the twenty-first century as we did in the mid-twentieth. Rather, we must summon data on the TNCs themselves to encompass their transnational operations. This will reveal, for example, that despite the declining global share of United States GDP from 40% in 1960 to below a quarter from 2008 onward, American corporations continue to dominate sector after sector. In fact, in certain advanced sectors such as aerospace and software—even in financial services—American dominance has increased since 2008. There are no serious contenders, including China. By looking at the wrong data, many have failed to see that American economic power has not declined—it has globalized.This paper is interesting in two ways. First, it recasts the discussion away from monadic attributes -- GDP share, say -- towards global categories -- market share of American multinational corporations. Second, it suggests that the old "relative power" discussions, which tend to be cast in dyadic terms, is also inappropriate. Instead we need to think globally. If China increases its GDP share relative to the U.S. but does so by importing American technology, adding a small amount of value, then exporting a finished product, the statistics will show a big GDP boost from exports but can we really say China has gained on the U.S. in any meaningful way? As Susan Strange once wrote, becoming a blue collar worker in service to American white collar management does not make you more powerful than the Americans. The old dependency theorists understood this quite well even if they got some other things wrong. Add to this Benjamin Cohen's recent work (with Tabitha Benney) showing that the US dollar has not slipped in importance in the monetary system (recent events have demonstrated this), and my dissertation (recently defended) showing that American prominence in global banking has increased since the crisis, and the overall picture looks clear: relative to recent history, the U.S.'s power position has not changed and has in some ways improved.
At the same time, China's immaturity has made many of its neighbors nervous. Japan, Korea, and Australia have increased security and economic ties with the U.S. which had slipped a bit a decade ago. The Transpacific Partnership will likely extend these gains. China's inability to encourage others to bandwagon with it is evidence that it has not gained much, if any, leverage on the United States. China's increasing reliance on the world's baddies -- which are increasingly under threat -- as sources of raw materials and markets for trade and FDI is not an indication that it is moving it into a position at the core of the global system. The inability of China to make ASEAN+3 a meaningful institution -- or develop any other -- is another weak spot, as is its recent growth slowdown, financial instability, and the fact that it faces 250-500 domestic protests per day.
Or perhaps I could put it another way. If, in 2003, I had told you that the Iraq and Afghanistan wars would be a disaster, the U.S. would propagate the worst global financial crisis since the 1930s, the Middle East would be in utter turmoil, the biggest development in American politics is the rise of right- and left-wing protest movements, China would grow at 10%/year over the course of the decade and that the net result of all of this is that the U.S. has become more prominent in the global economic and security systems... you'd probably think I was insane.
But that's what's happened.
