World GDP: A Story of American Leadership and Asian Partnerships

Derek Scissors /

In the midst of a downturn, it’s easy to lose perspective. It feels at the moment like America’s position in the world is slipping and Asia is taking our place. Permanently. On a longer view, that turns out to be only half-right: Asia is rising but America is not falling. With sound policies, the U.S. will be by far the world’s most important economy for a long time. One of those sound policies is strengthening our ties with Asia.

To get a better sense of the current situation, go back to the last time American leadership was supposedly headed for extinction. That was the oil crisis, with its stagflation, in the mid 1970’s. Starting with the Reagan Administration in 1980, the U.S. was considered by the entire globe to have recovered and cemented its place at the top. It turns out that, except for a blip in the late 1990’s, the American share of the world economy has been almost the same for 35 years. The U.S. accounts for more than a quarter of the world economy by itself and continues to hold that level even in these tougher times. (more…)