Courcy's Intelligence Centre

1.  The United States is the world's only superpower and will remain so for the foreseeable future.

2.  China is seen to be the major long-term threat to US dominance, however even linear projections (which are likely to overstate) show real Chinese GDP reaching $6.4trn in 2025, more or less the same level as Japan ($6.3trn) and considerably ahead of Russia on $1.5trn, but still a long, long way behind the United States, with an economy projected to be worth $22.3trn in 2025.

3.  China's military expenditure is a concern to the United States, but whatever the true nature of China's military expenditure, it is still only a fraction of the US's. The US is responsible for 48% of the world's total military expenditure, distantly followed by the UK, France, Japan, and China with 4%-5% each.

4.  A Cold War-style rivalry with China is unlikely given the depth of economic interdependence and the lack of an antagonistic alliance structure.  However, a crisis over Taiwan could, at any time and at short notice, lead to an extremely rapid deterioration in relations.

5.  The US increasingly has to take the European Union seriously as an economic power, but the expansion of the EU to encompass Eastern Europe has ruled out any prospect of it becoming a serious political or military challenge to the United States.

6.  Islamist militancy continues to pose a serious threat, but nothing approaching an existential challenge, to the United States.  This threat has prompted the US to react in sometimes unwise and irrational ways (the invasion of Iraq, in particular, was an irrational response to the al-Qaeda threat), thus diminishing its world standing, the coherence of its anti-terror alliance, and the level of domestic support for military action.

7.  The US's global interests stem from its position as the world's pre-eminent trading power.  Its natural allies are the free-market democracies that believe in an open world trading system, but the threat from al-Qaeda has retaught the lesson that there are even more fundamental interests than the promotion of free trade and democracy.  Security concerns have pushed it closer to some powers that would otherwise be anathema.

8.  Over time, US external policies will be affected by internal dynamics, such as changing demographics and economic performance.

These are the essential assumptions on which CourcyInt analysis of US's position in the world is based. Developments that might affect any or all of these assumptions are constantly monitored, and the assumptions themselves are under constant review.

Our evolving analysis can be tracked by viewing the Courcy's Intelligence Analysis link in this report.