The postwar economic order dominated by the United States is unraveling. In its place is emerging a world dominated by three major trading blocs controlled by the leading industrial powers of Europe, North America and East Asia. If the movement toward such a tripolar system continues, all countries outside those blocs—the industrializing but heavily indebted countries of Latin America, the impoverished nations of the Third World and the East-bloc countries that are belatedly entering the free-market system—will be at a decided disadvantage and may fall further behind.
As the 20th century nears its close, Americans are undergoing an identity crisis. For the past half century, the United States has been the world's leading economic power. Today, however, Americans must accept the fact that other nations are catching up with the United States and could eventually surpass it in terms of wealth and general living standards.
It is not yet time for the United States to hand over the crown in the competition for economic leadership. But increasingly, there is a sense that the heyday is over. “What seems clear is that the United States will be sharing power, both economic and political,” says Robert B. Reich of Harvard University's Kennedy School of Government. “The days of American economic hegemony are undoubtedly over.”