Survival: Global Politics and Strategy, vol. 51, no. 4, August–September 2009, pp. 193–200
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For several months following the US presidential election in November 2008, most Americans took great pleasure in their charismatic new president. A series of soaring speeches, frank interviews and pragmatic initiatives made real changes for the better seem possible. Of course, other presidents have begun with high hopes, only to be ensnared in multiple dilemmas inherited from their predecessors, and by summer 2009 Barack Obama’s own prospects have begun to seem more problematic. Disagreements have surfaced between the White House and Congress and rumours proliferate about splits in the administration’s own ranks. Fear grows that the president – attempting simultaneously to overcome a severe financial crisis, address long-neglected domestic needs and win two intractable wars – has overreached himself.
Assessing long-term prospects for Obama’s foreign policy requires determining what its particular elements and priorities actually are. To what extent does it represent a coherent vision, as opposed to a series of ad hoc responses to inherited situations? So far the administration’s over-riding concern has been the world economic crisis. Foreign policy in general has been dominated by economic policy in particular. Our most significant diplomacy has been concerned with persuading other major countries to adopt financial remedies compatible with our own.
But today’s economic diplomacy also raises broader questions about the future character of the world order. The United States can hardly ignore the impact of today’s financial and economic crisis on the country’s international role. So far, the crisis probably favours a ‘declinist’ view of American global hegemony. In marked contrast to the US geopolitical vision of a decade or two ago, today’s dispensation of power is increasingly seen as plural rather than unipolar. Such a view suggests fresh roles for the United States, Europe, Russia and China. To what extent is the Obama administration influenced by this pluralist view? Has it generated a corresponding geopolitical vision of America’s place in the world, and does this actually guide the administration? How inclined is the rest of the world to accept this vision? Can Americans themselves believe in it? Finally, to what extent are these broad questions being determined by the interaction of differing financial policies among the major players? In short, what is the likely impact of today’s financial and economic crisis on America’s traditional leading international role, and to what extent does Obama’s foreign policy anticipate that impact?
Political-economic linkages are never simple, and no doubt it is too early to tell how present policies will unfold. But one linkage that seems relatively direct and decisive is the future place of the dollar in international monetary arrangements. For more than a half century, the dollar’s role as the world’s principal reserve currency has given the United States an unmatched capacity to create credit for itself, money that the rest of the world has been willing to accept. That capacity has been a critical element in America’s leading global position. But this has been contested periodically and now appears seriously threatened.
Understanding the current threat requires a closer look…
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David Calleo is a University Professor at Johns Hopkins University and Dean Acheson Professor and Director of European Studies at its Paul H. Nitze School of Advanced International Studies (SAIS). He has recently published Follies of Power: America’s Unipolar Fantasy with Cambridge University Press and is a Survival Contributing Editor. A version of this essay was presented at a meeting of the European Security Forum at the Center for European Policy Studies in Brussels, 12 June 2009. © 2009 David Calleo.
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