Costs and Challenges of Being a Superpower

This lesson examines the costs, burdens and challenges associated with superpower status — military overstretch, economic strain, domestic inequality, political polarisation and the theoretical frameworks that explain imperial decline. You will evaluate whether the USA is in decline and consider future scenarios for the global power balance. This lesson addresses the Edexcel Enquiry Question: "What are the implications of the changing balance of power for the future of the global order?"

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The Burden of Military Power

Military Spending

Maintaining global military supremacy is extraordinarily expensive. The USA's military budget illustrates the scale:

Category	US Spending (2024, $ billion)	Comparison
Total defence budget	886	More than the next 10 countries combined
Overseas bases	~60–80 (estimated)	750+ bases in 80+ countries
Nuclear weapons maintenance	~50+	Includes modernisation of the nuclear triad
Veterans' benefits	~300+	~18 million living veterans
Intelligence agencies	~90+ (estimated)	CIA, NSA, NGA and 15 other agencies

Every dollar spent on the military is a dollar not spent on domestic priorities — healthcare, education, infrastructure, climate adaptation. This is the classic "guns vs butter" trade-off.

Military Overstretch

Paul Kennedy's concept of imperial overstretch (from The Rise and Fall of the Great Powers, 1987) argues that great powers decline when the costs of maintaining military commitments exceed the economic base that supports them. Kennedy observed this pattern in:

• Hapsburg Spain: Military commitments across Europe and the Americas exhausted the Spanish treasury despite vast gold and silver imports from the New World.
• The British Empire: Two World Wars depleted British economic and military resources, making the Empire unsustainable.
• The Soviet Union: The combination of high military spending (estimated at 15–25% of GDP), the Afghan War and an inefficient command economy led to collapse.

Kennedy's argument raises a crucial question: is the USA experiencing imperial overstretch?

Evidence for US overstretch:

• Afghanistan (2001–2021): 20 years of war cost approximately $2.3 trillion; approximately 2,400 American and 170,000+ Afghan deaths; the Taliban returned to power almost immediately after US withdrawal — arguably America's most significant military failure since Vietnam.
• Iraq (2003–2011+): The invasion and occupation cost approximately $3 trillion (including long-term veteran care); approximately 4,500 American and 200,000+ Iraqi deaths; no WMDs were found; Iraq became an arena for Iranian influence.
• Global base network: Maintaining 750+ overseas military bases costs tens of billions annually and generates resentment in host countries.
• National debt: US national debt exceeded $34 trillion by 2024 — approximately 123% of GDP.

Evidence against US overstretch:

• Defence as % of GDP: US military spending is approximately 3.4% of GDP — high by international standards but far lower than Cold War levels (6–10% of GDP in the 1950s–60s) or the Soviet Union's estimated 15–25%.
• Economic size: The US economy ($27.4 trillion GDP) is large enough to sustain current military commitments.
• Technological advantage: The USA maintains a decisive technological edge in most military domains.
• Alliance burden-sharing: NATO allies (and Japan, South Korea, Australia) share some of the defence burden.

Exam Tip: Kennedy's imperial overstretch thesis is a key evaluative framework for this topic. Apply it comparatively: assess whether the USA shows the same patterns as previous declining powers. The strongest answers will argue that while the USA shows some symptoms of overstretch (Afghanistan failure, rising debt, domestic inequality), it also has compensating strengths (economic size, technological leadership, alliance network) that previous declining powers lacked.

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Economic Burdens

Fiscal Challenges

Indicator	USA (2024)	Significance
National debt	$34+ trillion	123% of GDP; largest nominal debt in history
Annual deficit	~$1.7 trillion	Government spending consistently exceeds revenue
Debt interest payments	~$890 billion	Exceeds entire defence budget; fastest-growing budget item
Infrastructure grade	C- (American Society of Civil Engineers)	Roads, bridges, water systems need $2.6 trillion in investment

The USA's fiscal position is not unique — Japan's debt is approximately 260% of GDP, and the UK's exceeds 100%. However, the USA's global military commitments and role as reserve currency issuer create specific vulnerabilities.

The Semiconductor Dilemma

The USA's reliance on Taiwan (TSMC) for advanced semiconductor manufacturing represents a critical economic vulnerability. If Taiwan were invaded or blockaded by China, the USA would lose access to approximately 90% of the world's most advanced chips, crippling everything from military systems to consumer electronics. The CHIPS Act (2022) — providing $52 billion for domestic semiconductor production — is an attempt to address this vulnerability, but building cutting-edge fabrication facilities takes years.

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Domestic Inequality and Social Strain

Superpower status does not necessarily translate into domestic prosperity or social cohesion. Both the USA and China face significant domestic inequality challenges.

US Inequality

Metric	Data	Significance
Gini coefficient	0.39 (2023)	Highest income inequality among developed nations
Top 1% wealth share	~32%	Top 1% hold more wealth than the bottom 90%
Poverty rate	~11.5% (~37 million people)	Despite being world's richest country
Life expectancy	77.5 years (2023)	Lower than all comparable rich countries; declining
Healthcare spending	17.8% of GDP	Highest in the world, but ~28 million lack health insurance
Student debt	$1.75 trillion	Exceeds total credit card debt
Homicide rate	6.4 per 100,000 (2023)	5–25x higher than other developed countries

The paradox of American power is that the world's most powerful country has worse social outcomes than many smaller, less powerful nations. Norway, Denmark, Sweden, Switzerland and Japan all have longer life expectancies, lower poverty rates, lower inequality and lower crime rates — despite having a fraction of America's military and economic power.

This raises a philosophical question central to the Superpowers topic: what is the point of superpower status if it does not translate into better lives for citizens?

Chinese Domestic Challenges