By all appearances, the United States is a mess. Two-thirds of Americans believe the country is on the wrong track, and nearly 70 percent rate the economy as “not good” or “poor.” Public trust in government has fallen by half, from 40 percent in 2000 to just 20 percent today. Love of country is fading, too, with only 38 percent of Americans now saying patriotism is “very important” to them, down from 70 percent in 2000. Congressional polarization has reached its highest point since Reconstruction, and threats of violence against politicians have surged. Former U.S. President Donald Trump faced two assassination attempts en route to reclaiming the White House, winning the popular vote even though many Americans believe he’s a fascist. Some scholars draw parallels between the United States and Weimar Germany. Others liken the United States to the Soviet Union in its final years—a brittle gerontocracy rotting from within. Still others argue that the country is on the brink of civil war.

Yet such undeniable American dysfunction has had remarkably little effect on American power, which remains resilient and, in some respects, has even grown. The country’s share of global wealth is about as large as it was in the 1990s, and its grip on global arteries—energy, finance, markets, and technology—has strengthened. Internationally, the United States is gaining allies, whereas its main adversaries, China and Russia, are increasingly embattled. Inflation, massive debt, and sluggish productivity remain serious concerns, but they pale in comparison to the economic and demographic headwinds facing other great powers.

This is the paradox of American power: the United States is a divided country, perpetually perceived as in decline, yet it consistently remains the wealthiest and most powerful state in the world—leaving competitors behind.

How can such dominance emerge from disorder? The answer is that the United States’ main assets—its vast land, dynamic demographics, and decentralized political institutions—also create severe liabilities. On the one hand, the country is an economic citadel, packed with resources and blessed by ocean borders that shield it from invasion while connecting it to global trade. Unlike its rivals, whose populations are shrinking, the United States enjoys a growing workforce, buoyed by high levels of immigration. And despite political gridlock in Washington, the country’s decentralized system empowers a dynamic private sector that adopts innovations faster than its competitors. These structural advantages keep the United States ahead—even as its politicians squabble.

Yet these same strengths also create two major vulnerabilities. First, they deepen the divide between prospering urban hubs and struggling rural communities, intensifying economic disparities and fueling political polarization. Although cities have largely benefited from an increasingly globalized, knowledge-based economy powered by immigration, many rural areas have been left behind as manufacturing and public-sector jobs have dwindled, breeding resentment and fraying national unity. Second, geographic insulation and wealth foster a sense of detachment from global affairs by shielding the country from external threats, leading to chronic underinvestment in military and diplomatic capabilities. At the same time, its vast power, diverse population, and democratic institutions drive the United States to pursue an array of ambitious interests abroad. This tension between detachment and global engagement results in a hollow internationalism in which the United States seeks to lead on the world stage but often lacks the resources to fully achieve its goals, inadvertently fueling costly conflicts.

Together, these vulnerabilities—domestic fragmentation and strategic insolvency—threaten the United States’ stability and security, creating dualities that define its power. An economic boom coexists with a civic bust. Unmatched material strength is often squandered by a feckless foreign policy. Trade and immigration enrich the country yet strain its social fabric and devastate working-class communities. The challenge for American leaders is to navigate these contradictions. If the United States can balance its ambitions with its resources and bridge its internal divides, it could not only preserve its power but also contribute to a more stable world order. Otherwise, the paradox of American power may one day bring it all crashing down.

The United States remains an economic powerhouse, accounting for 26 percent of global GDP, the same as during the “unipolar moment” of the early 1990s. In 2008, the economies of the United States and the eurozone were nearly equal in size, but today, the American economy is twice as large. It is also roughly 30 percent larger than the combined economies of the so-called global South: Africa, Latin America, the Middle East, South Asia, and Southeast Asia. A decade ago, it was just ten percent larger. Even the Chinese economy is shrinking relative to that of the United States in current dollar terms—the clearest gauge of a country’s purchasing power in international markets—and that measure flatters China, since Beijing inflates its numbers. In reality, China’s economy is smaller than the Communist Party claims, and it is barely growing. That dismal performance is backed up by the behavior of China’s citizens, who increasingly vote with their money and their feet. From 2021 to 2024, Chinese citizens illicitly moved hundreds of billions of dollars out of China and became the fastest-growing migrant group crossing the U.S. southern border, with their numbers surging 50-fold over this period.

The United States is also widening its lead in per capita wealth. In 1995, Japanese citizens were, on average, 50 percent wealthier than Americans, measured in current dollars; today, Americans are 140 percent richer. If Japan were a U.S. state, it would rank as the poorest in average wages, behind Mississippi—as would France, Germany, and the United Kingdom. From 1990 to 2019, U.S. median household income rose 55 percent after taxes, transfers, and adjusting for inflation, with income in the bottom fifth seeing a 74 percent gain. Although most major economies have suffered declining wages since the COVID-19 pandemic, U.S. real wages have kept rising, showing a modest gain of 0.9 percent from 2020 to 2024. Many Americans, especially renters and citizens without stock holdings, feel they are losing ground because of persistently high housing and food prices, but the majority are wealthier than before the pandemic, with low-income workers seeing particularly strong gains. Since 2019, wages for the lowest-paid decile have grown nearly four times as fast as for middle earners and over ten times as fast as for top earners, helping reverse about a third of the wage inequality accumulated over the past 40 years. Today, American millennials earn roughly $10,000 more on average than previous generations did at the same age (adjusting for inflation) and are similarly likely to own homes. Many U.S. middle-class households rank within the richest one to two percent of global income earners.

This combination of individual wealth and sheer economic size sets the United States apart. Unlike China and India (which are populous but poor) or Japan and western European countries (which are small but wealthy), the United States combines scale with efficiency, generating unrivaled material power. Size alone can yield vast output, but without high per-person productivity, much of that output will be wasted or consumed domestically, leaving little for global influence. History has proved this: in the nineteenth century, China had the largest population and economy in the world, and Russia had the largest in Europe, yet both were bested by more efficient powers such as Germany, Japan, and the United Kingdom.

Although the United States has economic weaknesses, they are generally less severe than those of other major economies. For example, U.S. total factor productivity growth (which measures how efficiently a country translates all its resources—labor, capital, and technology—into economic output) has been sluggish over the past decade, but it remains positive, unlike the negative rates plaguing China and European countries, according to data from the Conference Board, an economic research organization. Total U.S. debt, including government, household, and business debt, is massive, at 255 percent of GDP in 2024, with interest payments on the federal debt climbing to 14 percent, approaching the 18 percent spent on the country’s defense budget. But it still falls below the average for advanced economies, remains well under China’s ballooning debt of over 300 percent of GDP, and has declined by nearly 12 percent from its peak in 2021. Meanwhile, other major economies are seeing their debt burdens continue to mount.

The United States has also expanded its military alliances and its control over financial systems, energy markets, consumer bases, and technological development, increasing its ability to shape the system in which other countries operate. Consider the dollar. The currency now accounts for nearly 60 percent of global central bank reserves—down from 68 percent in 2004 but equivalent to its 1995 share. It is used in roughly 70 percent of both cross-border banking liabilities and foreign currency debt issuance—up from 2004—and almost 90 percent of global foreign exchange transactions. The dollar’s dominant role allows Washington to impose sanctions, secure lower borrowing costs, and bind other countries’ fates to its own. Foreign governments holding large dollar reserves are effectively vested in a system in which the economic health of the United States underpins their prosperity, making them hesitant to take actions—such as currency devaluations or sanctions—that could ultimately harm their own interests.

The U.S. energy transformation has further bolstered Washington’s global influence. Once the world’s largest energy importer, the United States is now the leading producer of oil and natural gas, surpassing Russia and Saudi Arabia. Simultaneously, it has adopted energy efficiency and renewable technologies, bringing per capita carbon emissions down to levels not seen since the 1910s. This energy boom has kept U.S. oil and gas prices low, even during international conflicts. European companies, for example, currently pay two to three times as much for electricity and four to five times as much for natural gas, prompting some foreign manufacturers to relocate to the United States. Energy production has also helped Washington insulate itself and its allies from foreign coercion. After Russia invaded Ukraine, for instance, the United States was able to help Europe, heavily reliant on Russian energy, make up its shortfall by sending it oil and gas. Meanwhile, the huge American consumer market, equivalent to China’s and the eurozone’s combined, pressures foreign companies and governments to align with U.S. trade policies to maintain access to the world’s most lucrative revenue source.

The United States’ lead in global innovation further strengthens its structural power. U.S. firms generate over 50 percent of the world’s high-tech profits, whereas China captures only six percent. This innovation edge positions U.S. companies at critical points in supply chains, enabling Washington to twist production networks, as demonstrated by its coordination of multinational semiconductor restrictions on........

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