Amid Bailout Debate, Decline of U.S. Power Is a Hot Topic at the United Nations

Wall Street's meltdown under Bush's waning tenure has diplomats mulling America's reduced stature.

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Though President Bush and Secretary of State Condoleezza Rice have been visiting the United Nations in recent days—with meetings continuing this week for Rice—for their usual, intensive annual round of diplomacy, the behind-the-scenes buzz at the world body is focused on the relative decline of U.S. power in world affairs.

Private chatter among the thousands of visiting diplomats and dozens of national leaders has been dominated by a shared perception of reduced American power in the waning days of the Bush administration, says a senior U.N. diplomat. "The corridors are full of it," says the diplomat.

Foremost in their rationale for arguing that U.S. power has peaked is the financial meltdown on Wall Street and the banking sector—and the very expensive bailout still under debate to calm the markets.

Not only are U.N. diplomats worried about the spillover of financial damage to their markets, but they find a free market-oriented administration's full-throated backing of a highly interventionist bailout galling, coming after years of Washington hectoring other countries about maintaining economic prudence and counseling against debt bailouts.

"Here's the U.S. engineering the mother of all bailouts," marveled the diplomat. He says diplomats believe that poor Bush administration policy choices, the lengthy and unresolved military engagements in Iraq and Afghanistan, and the general rise of powers like Russia, China, and India have all eroded U.S. power in relative terms.

"America's blindness to recognize how the world has changed" is how the diplomat put it.