America’s global dominance has found its basis in economic supremacy and both could be ending in light of on-going domestic and international economic difficulties.
Carnegie Mellon University professor of political economy and public policy and visiting scholar at the American Enterprise Institute (AEI) Allan Meltzer presented a paper at a recent briefing at the Washington, D.C. think-tank.
In the paper, entitled End of the American Century, he argued that major changes are needed in global institutions and that the period of U.S leadership may be coming to an end, and as the country’s problems mount, it will become more difficult to reach domestic and international consensus on how to maintain economic growth.
He said the Cold War era, when the U.S. proposed military and economic strategies to avoid war, contain the Soviet Union, and prevent a return to the destructive economic policies of the interwar years, is ending.
“Much has been written about international disagreements and reduced U.S. influence on international political decisions. Much of this commentary seems overstated. The United States remains strong militarily but divided about how to translate power into influence,” he said, arguing that this was due to the weakening of international economic institutions as well as the influence of domestic policy and politics.
And he added: “The U.S. no longer is able to develop plans that others accept. It retains an important role, but it has less power and influence than in the past. Part of the change results from the success of America’s postwar policies that encouraged many countries to develop.”
On the domestic front, he said politics in the U.S. remain in a stalemate, with healthcare policy and promises becoming an extreme example of the absence of discipline in the political process.
“We have two political parties. One wants to spend more and tax the rich. The other is willing to spend more but wants to tax less. The usual compromise is more spending but lower or not higher tax rates. The result is an outstanding publicly held debt of about $4.5 trillion dollars, about half owned by foreigners and even larger—much larger—unfunded liabilities,” he said.
Jesse Masai is an intern at the American Journalism Center, a training program run by Accuracy in Media and Accuracy in Academia.
