Reagan and the decline of American power

AS Congress continues to look at various elements of the defense budget -- and the operation of the Pentagon -- it ought to reflect on a fundamental irony at the heart of the Reagan administration's national security strategy: Though the administration came to office determined to reverse the deterioration of American power and to reassert American global primacy, its policies are more likely to accelerate the American decline. President Reagan believed that American power had suffered because of a failure to sustain American military strength and to respond decisively to the Soviet threat. But the sources of decline are -- as most analysts have long recognized -- much deeper, being rooted in a variety of changes that have produced a broader diffusion of global power.

The Nixon, Ford, and Carter administrations tried seriously to accommodate to this reality while preserving and enhancing the remaining substantial margin of American influence. That required a reassessment of the American role in the world, ideological flexibility, and the skillful use of diplomacy.

The Reagan administration has rejected the idea that the diffusion of power represents a fundamental change in the international landscape and has relied almost exclusively upon the buildup of US military power to reverse it. Diplomacy has been little valued and the administration has demonstrated little aptitude for it. It has lacked the ideological adaptability and top-level direction to play the complex game of international politics attempted by its predecessors.

Reagan's approach to defense spending is based, in important part, on the notion that the sheer magnitude of the defense budget counts most in the power equation. Our decline is seen as growing out of our failure to match Soviet military spending. In reality, the US and its allies have always spent more than the Soviets and their allies. More important, the administration does not seem to recognize that the very international and domestic constraints that have made it cautious about actually using milit ary force have broader negative implications for the US capacity to translate the Reagan buildup into increased power.

The buildup has also produced proportionately little power because much of it has gone into pay increases, research and development, and modernization of strategic nuclear forces which cannot, by their nature, be transformed into international influence.

More fundamental, the size of the program, in combination with the unwillingness of the administration to raise taxes, is likely to produce serious economic difficulties that will strike at the very base of American power. Defense and tax policies have played a major role in creating the massive budget deficits, overpriced dollar, and record-breaking trade imbalances that make the American economy so fragile.

Although prediction is difficult, some likely effects of these economic imbalances on American power are reasonably clear. While the imminent transformation of the US into the world's largest debtor is not going to make America into another Mexico, it will reduce the US ability to play a leading role in the global economy, making US economic progress and welfare more the hostage of the interests and actions of others.

Since much of our borrowing is not increasing US non-military productive capacity, the need to service the debt and to reduce the trade gap will make us poorer. (Annual service on overseas debt could be upward of $100 billion by 1990 at present rates of growth.) In this situation our capacity to finance foreign aid, NATO troop deployments, and other overseas activities will be severely constrained.

The effects of our debtor status upon US domestic politics could include a neo-nationalist tendency, ever-increasing protectionism, and pressures to monetize the US debt through inflationary policies. Concessions to such pressures will reduce the capacity of the US for constructive international influence.

Recent action to drive down the dollar, if not accompanied by fundamental changes on defense spending, tax policy, and developing-country debt, is unlikely to forestall a major global economic adjustment that could include such elements as a worldwide economic contraction, detonation of the ``debt bomb,'' and a large rise in US inflation. Such developments could be devastating for American power.

We need to return to President Eisenhower's recognition that national security must rest upon the twin pillars of a strong defense and a strong economy and that too much emphasis upon the first can undermine the second.

Robert H. Johnson, a visiting fellow at the Overseas Development Council, is a former member of the National Security Council staff and the State Department's Policy Planning Council.

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