Current debates about the debt, deficit, debt ceiling etc etc are all urgent for one reason: some predict the end of American dominance and leadership in the world unless we take action now. Without a doubt, the amount of debt is a problem for us but I'm not going to weigh in on that debate right now but instead focus on the doomsday predictions that we hear all over the place (and not just by Glenn Beck anymore!). Will we see Chinese dominance in the next 15 years? Will our economic situation finally cause us to go belly up like the mighty Roman Empire?
I'm no economist and I won't pretend to be one by listing a bunch of numbers and mathematical equations but I will point out something that is often overlooked by commentators when they talk about the situation. Besides the obvious economic component there is an even more complicated political component that makes the fall less likely to happen without a major shift in world alliances. Right now you have an emerging alliance that increasingly relies on Chinese leadership, as I wrote about earlier. The Chinese have been angling to have their currency take over as the worlds currency, replacing the dollar. China has become a force to be reckoned with given their very strong production and exporting meaning their goods, and more importantly their money, is in great supply around the world. This has given their cause not only an economic advantage but a political one as well because they have more influence around the world. To illustrate this, one only has to look back to how American influence increased after World War II.
Is that enough for China to take down America? Hardly. The global economy that has emerged in the aftermath of WWII the tech boom almost guarantee that no one country can effectively control the world causing alliances to become more and more important. China would need backing from the world's most powerful countries and at the moment those countries reside in the West: America (of course), the UK, Germany (largely overlooked but very important), and France. Those countries aren't looking to provide that backing anytime soon. However, China has a few tricks up it's sleeve though namely the support of Russia; the developing countries of Brazil and India are looking to challenge the traditional world order so that they can facilitate greater growth and play a greater role in world affairs. Brazil and Africa play an important role in this scenario because of the natural resources they possess. Natural resources are becoming more and more rare making them more valuable to their owners. China has began increasing diplomatic relations in Africa perhaps for this reason.
China consumerism is moving slowly but surely towards one that resembles what we are used to seeing here in America. A report out a few months ago showed that for the first time in seven years, imports overshadowed exports in China but not for lack of exporting (exporting actually increased) but because imports grew just that much. That in itself is telling. If this is a trend that continues then one can argue that China is losing a bit of it's strong socialist tendencies perhaps opening the door to better relations with the West.
It's very plausible that the American role in the world will be diminished. I even believe that will happen. But will Americans cease to play an important role in world affairs? Unlikely. If I were to make a prediction then I would say we're going to see more cooperation between various countries that could usher in a new era of worldwide peace. I can dream right?
