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Are We Really Going The Way Of The British Empire?
Those who believe America’s power is on the wane look to the example of Britain’s shockingly quick collapse. But the similarities may be less alarming than they seem.
May/June 1991 | Volume 42, Issue 3
The analogy of Britain is again flawed, because we’ve been capital importers rather than capital exporters. But the interesting thing is that the Americans financed their government budget deficit by importing capital. That had the effect of keeping the investment rate up, so that gross investment in the American economy stayed at a constant level of about 17 percent, pretty much what it had been since the seventies or so. One of the questions now that we’ve entered a capital-scarce world is, Will the investment rate in the United States fall off? The answer may be that it will fall off unless we find ways to increase our savings and therefore get interest rates down, making investments more attractive.
It is sometimes suggested that British decline stems in part from the fact that manufacturing carried so much less prestige in Edwardian Britain than either government service or the professions. It is similarly said that over the last fifteen or twenty years the disturbing shifts of Americans of talent into the professions and out of an industrial or scientific or technical education is a similar phenomenon that augurs equally ill. In your book such cultural explanations are constantly labeled as “dicey.” What do you think of the parallel?
Well, the trouble with that cultural explanation is that it changes too rapidly. If culture is to be a useful explanatory variable, it had best be something that you change quite slowly. Clearly, the rewards that were paid to young college graduates going into investment banking in the eighties were wildly excessive and had a very strong skewing effect in directing talent away from manufacturing companies into financial investments. But if you look at the situation now—eight years later—or even five years later, that has turned around. The investment banking sector is rather ill right now, and the interest in manufacturing is increasing. It’s interesting that Harvard Business School, for example, in its admissions process, has been discouraging students who want to go into investment banking and preferring people who show interest in the manufacturing sector. I am skeptical of a cultural explanation if American culture is taken to be so volatile that it changes that quickly over so short an amount of time.
As we compare the major contenders for most powerful country, America remains the most impressive, with a more diversified portfolio of resources than any other nation in the world.
Another culturalist argument about Britain points to the polarization of class attitudes in Edwardian Britain, which stored up a great deal of trouble. In contemporary America one would presumably not point to class tension in the traditional sense, but isn’t racial and ethnic tension our parallel?
I think the United States has very serious questions to resolve in terms of racial differences. And I think these are particularly serious when we get into what is sometimes called the underclass, or people who are in a culture of poverty. But here we’re talking about, well, it’s hard to know what percent of the population, but it’s in single digits. And that’s quite different from the class of plebeians that Britain faced at the beginning of the century, which was certainly in the double digits.
Frankly, it is not clear to me that these tensions are having a major effect on the international power position of the United States. They obviously would if we were totally preoccupied with internal racial and ethnic cleavage or if the proportions of the population in question were so high that they were then unable to be effective members of the labor force. But as it is, these very pressing social issues are not nearly as important in determining the international power position as they are in determining the quality of civic life.
The title of your book is Bound to Lead. If the United States retains its position, what will it do as it leads for the next thirty or forty years?
Bound to Lead is a double entendre, which is seen in the context of the subtitle of the book, which is The Changing Nature of American Power. The argument of the book is that there’s a multiplicity of modes of power in world politics and that the great historical metaphor that we’ve always had in our mind—that there’s always a number-one country and that you look over your shoulder and say, “Who’s chasing me for number one?"—was probably misleading us.
The problem is not who’s going to replace us as number one, but who wants the power that is leaking out all over the bottom. Private actors, lots of new states, the proliferation of technology, and so forth are making it more difficult for any large country to control world politics. What that suggests is that the largest country has to take a role in forming coalitions.
Whether it’s issues like Saddam Hussein in the Persian Gulf, or global warming, or helping less developed countries, or debt problems that are just breaking out in the international banking system, the Americans aren’t going to be able to do this alone, but if we don’t do our share as the largest, it’ll be much harder for anybody else to organize coalitions to get things done. Certainly the war in the Gulf demonstrates this. So we’re bound to lead, not in the simple sense of the term but in the sense of being tied into this position by our very size.
One of the very persuasive sections of your book is the way you look with a cold eye at the alleged predetermined successes of our rivals. Would you care to run down those arguments?