Is America Really On the Decline?

Financial crisis. Two wars. Rising rivals. And talk about whether the American era is coming to an end.

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At the same time, India, the world's most populous democratic state, has also found a surer path to prosperity that is broadening its influence and enabling a military buildup. Along with the economic recovery of Japan and the growth of what used to be called the "tigers" of South Korea and Southeast Asia, predictions of a "Pacific century" or an Asian one look more plausible. Asia is returning to its historical norms, Kishore Mahbubani, dean of the Lee Kuan Yew School of Public Policy at the National University of Singapore, argues in his book The New Asian Hemisphere. "The era of Western domination has run its course," he writes.

There are shifts elsewhere, too. The once slumbering giant of South America, Brazil, is overcoming its past weaknesses. Russia is undergoing a resurgence of uncertain duration, courtesy of massive sales of oil and natural gas. Its invasion of neighboring Georgia and support for separatist regions there may mark a new period of strategic challenges to the West. Meanwhile, the European Union, in fits and starts, continues to evolve into a more coherent force in global affairs that, as a 27-nation collective, already presents the world's largest economy.

Biggest loser. The world's energy suppliers—especially those along the Persian Gulf—are also gaining strength. Flynt Leverett, director of the New America Foundation's Geopolitics of Energy Initiative, calls the flood of money from oil consumers to producers "arguably the greatest transfer of wealth from one group of countries to another." The "big loser," he says, is the United States. The Gulf Arab states, as a group, may emerge as the world's most important investor. As well, Iran and its regional ambitions will get plenty of sustenance.

But the rise of other powers doesn't tell the whole geopolitical story. They are forging connections without U.S. involvement and, in some cases, with the likely aim of blunting U.S. influence. The maneuvering reflects the sort of games nations have virtually always played. When one country's overweening power ignites concern, some of the others search for ways to counterbalance it. That can happen frontally, through political-military alliances or, more gingerly, in a nonconfrontational mode dubbed "soft balancing." For instance, Russia, China, and the four Central Asian states have formed the Shanghai Cooperation Organization, a group with a decidedly non-U.S. approach to world affairs—no hectoring about human rights and democracy there. And though the United States, with its tight alliances, is East Asia's leading protecting power, it is not part of a new regional grouping that is becoming more influential. China is reaching deeply into Africa, the Middle East, and even Latin America with trade deals, energy investments, and aid with few strings attached.

Russia, too, is using arms sales and energy commerce to revive old connections in the developing world. Its outreach, especially in Latin America, appeals to left-leaning governments aloof from Washington. For the first time since the Cold War, a Russian naval fleet is heading into Latin American waters for exercises with Venezuela. Parag Khanna, an analyst with the New America Foundation, sees the uni-polar moment giving way to a different global game. In The Second World: Empires and Influence in the New Global Order, he predicts a "geopolitical marketplace" in which developing countries are courted by and align flexibly with one of the new "Big Three": the United States, the European Union, and China.

Others anticipate an even more complex diffusion of global power. Richard Haass, president of the Council on Foreign Relations and a former Bush administration official, argues that the new era will devolve into "nonpolarity," in which nation-states lose influence and a fractious assortment of nonstate players wield more clout. These include a variety of regional and global organizations, nongovernmental groups, foundations, multinational corporations, and even unsavory militias, drug cartels, and terrorist networks.