Kennedy and America’s Downfall

First off, please note: that’s Paul M. Kennedy, history professor at Yale. One meta-theme that has been floating around the media throughout the global financial crisis of the last month or so has been variations on “the overthrow of the American century,” the “undoing of Wall Street as the world’s financial center,” and the like. If you’re going to write about this, what better expert to consult than Prof. Kennedy, author (although it was way back in 1987) of the noted history The Rise and Fall of the Great Powers?

Germany’s Die Zeit recently caught up with the good professor to do just that, sending correspondent Thomas Fischermann to grab an interview (“USA loses world-power status”).

The general trend is of course already clear – it is at least indisputable that recent financial events have not been good for American interests. But to what degree is it accurate to speak of a decisive, permanent shift away from American power and/or dominance? Kennedy concedes only that what he calls the “American System” is currently experiencing a “weakness,” even as most Americans refuse to acknowledge that. But his evaluation of the state of the US dollar is harsher; in his view, the key metric is that that now composes only about 60% of world financial reserves, whereas around 1990 it made up “the overwhelming share” (“der überwältigende Teil“).

This fact – a change “of world-historic meaning,” according to Kenendy – reflects what will become, in the long run, a shift of world financial power to Asia, especially China and India. Not that anyone should lay plans to go out and start accumulating renminbi or rupees – Kennedy rather foresees a “multipolar currency world,” much in the same way as commentators (he mentions the Washington Post’s Charles Krauthammer) write of how, in sheer power terms, the world is transitioning from “unipolar” (with the US as the sole superpower) to multipolar. But it’s also true, as he notes, that Asia has already played an important, if under-the-radar, role as American and European central banks over the past month have struggled to contain the various crises, namely as not-to-be-ignored consultation partners. “Without them nothing works” Kennedy states, and mentions their potential to provide various types of rescues with timely contributions of capital. (He fails to mention that China alone, for example, could at any time bring the entire edifice crashing down by starting to unload its massive holdings of US Treasury debt.)

For me, Kennedy’s concentration on the financial is as interesting as his fobbing-off of the issue of geopolitical power onto other commentators like Krauthammer is surprising: the latter subject was what his famous book, at least, was all about, with the financial aspect to world power an important but subordinate aspect, and not the other way around. Has Prof. Kennedy in the meantime shifted his specialty to international finance? In its introduction to the interview, Die Zeit explicitly says that he teaches history, although at the London School of Economics in addition to Yale. If he has, can we have the same confidence in his academic credibility?

Another objection that occurs to me about Prof. Kennedy’s pronouncements here arises from that old aphorism, “To a man with a hammer, everything looks like a nail” – and especially, one would imagine, to a carpenter with a hammer, i.e. to someone especially trained and experienced in using hammers. So what would you expect when you go ask the question “Has the US now fallen as a great power?” to someone who wrote the book The Rise and Fall of the Great Powers – a book whose theme (or one of them, at least) was to warn the US about going down the same way as the rise-and-fall stories it presents? Maybe it would be better, in order to get the definitive academic assessment that the US has indeed been knocked off its throne, eventually to get such an admission from someone like Dinesh D’Souza, the right-wing commentator who wrote What’s So Great about America?. (Warning, though: D’Souza also wrote a tome entitled The Enemy at Home: The Cultural Left and Its Responsibility for 9/11.)

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