Fareed Zakaria examines The Future of American Power by contrasting it with British Imperial Power:
Britain has been a rich country for centuries (and was a great power for most of that time), but it was an economic superpower for little more than a generation. Observers often make the mistake of dating its apogee by great imperial events such as the Diamond Jubilee. In fact, by 1897, Britain’s best years were already behind it. Its true apogee was a generation earlier, from 1845 to 1870. At the time, it was producing more than 30 percent of global GDP. Its energy consumption was five times that of the United States and 155 times that of Russia. It accounted for one-fifth of the world’s trade and two-fifths of its manufacturing trade. And all this was accomplished with just two percent of the world’s population.By the late 1870s, the United States had equaled Britain on most industrial measures, and by the early 1880s it had actually surpassed it, as Germany would about 15 years later. By World War I, the United States’ economy was twice the size of Britain’s, and together France’s and Russia’s were larger as well. In 1860, Britain had produced 53 percent of the world’s iron (then a sign of supreme industrial strength); by 1914, it was making less than 10 percent.
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The historian Paul Kennedy has explained the highly unusual circumstances that produced Britain’s dominance in the nineteenth century. Given its portfolio of power — geography, population, resources — Britain could reasonably have expected to account for three to four percent of global GDP, but its share rose to around ten times that figure. As those unusual circumstances abated — as other Western countries caught up with industrialization, as Germany united, as the United States resolved its North-South divide — Britain was bound to decline. The British statesman Leo Amery saw this clearly in 1905. “How can these little islands hold their own in the long run against such great and rich empires as the United States and Germany are rapidly becoming?” he asked. “How can we with forty millions of people compete with states nearly double our size?” It is a question that many Americans are now asking in the face of China’s rise.Britain managed to maintain its position as the leading world power for decades after it lost its economic dominance thanks to a combination of shrewd strategy and good diplomacy. Early on, as it saw the balance of power shifting, London made one critical decision that extended its influence by decades: it chose to accommodate itself to the rise of the United States rather than to contest it. In the decades after 1880, on issue after issue London gave in to a growing and assertive Washington.
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Britain was undone as a global power not because of bad politics but because of bad economics. Indeed, the impressive skill with which London played its weakening hand despite a 70-year economic decline offers important lessons for the United States. First, however, it is essential to note that the central feature of Britain’s decline — irreversible economic deterioration — does not really apply to the United States today. Britain’s unrivaled economic status lasted for a few decades; the United States’ has lasted more than 120 years. The U.S. economy has been the world’s largest since the middle of the 1880s, and it remains so today. In fact, the United States has held a surprisingly constant share of global GDP ever since. With the brief exception of the late 1940s and 1950s, when the rest of the industrialized world had been destroyed and its share rose to 50 percent, the United States has accounted for roughly a quarter of world output for over a century (32 percent in 1913, 26 percent in 1960, 22 percent in 1980, 27 percent in 2000, and 26 percent in 2007). It is likely to slip, but not significantly, in the next two decades. Most estimates suggest that in 2025 the United States’ economy will still be twice the size of China’s in terms of nominal GDP.This difference between the United States and Britain is reflected in the burden of their military budgets. Britannia ruled the seas but never the land. The British army was sufficiently small that Otto von Bismarck once quipped that were the British ever to invade Germany, he would simply have the local police force arrest them. Meanwhile, London’s advantage over the seas — it had more tonnage than the next two navies put together — came at ruinous cost. The U.S. military, in contrast, dominates at every level — land, sea, air, space — and spends more than the next 14 countries combined, accounting for almost 50 percent of global defense spending. The United States also spends more on defense research and development than the rest of the world put together. And crucially, it does all this without breaking the bank. U.S. defense expenditure as a percent of GDP is now 4.1 percent, lower than it was for most of the Cold War (under Dwight Eisenhower, it rose to ten percent). As U.S. GDP has grown larger and larger, expenditures that would have been backbreaking have become affordable. The Iraq war may be a tragedy or a noble endeavor, but either way, it will not bankrupt the United States. The price tag for Iraq and Afghanistan together — $125 billion a year — represents less than one percent of GDP. The war in Vietnam, by comparison, cost the equivalent of 1.6 percent of U.S. GDP in 1970, a large difference. (Neither of these percentages includes second- or third-order costs of war, which allows for a fair comparison even if one disputes the exact figures.)
U.S. military power is not the cause of its strength but the consequence. The fuel is the United States’ economic and technological base, which remains extremely strong.
I love that Bismarck line that were the British ever to invade Germany, he would simply have the local police force arrest them. Anyway, I recommend the whole article.