Since the Cold War's end, America's military superiority has functioned as an entry barrier designed to prevent emerging powers from challenging the United States where its interests are paramount. But the country's ability to maintain this barrier faces resistance at both ends. First, the deepening financial crisis will compel retrenchment, and the United States will be increasingly less able to invest in its military. Second, as ascending powers such as China become wealthier, their military expenditures will expand. The Economist recently projected that China's defense spending will equal that of the United States by 2025.

Thus, over the next decade or so a feedback loop will be at work, whereby internal constraints on U.S. global activity will help fuel a shift in the distribution of power, and this in turn will magnify the effects of America's fiscal and strategic overstretch. With interests throughout Asia, the Middle East, Africa, Europe and the Caucasus--not to mention the role of guarding the world's sea-lanes and protecting U.S. citizens from Islamist terrorists--a strategically overextended United States inevitably will need to retrench.

Further, there is a critical linkage between a great power's military and economic standing, on the one hand, and its prestige, soft power and agenda-setting capacity, on the other. As the hard-power foundations of Pax Americana erode, so too will the U.S. capacity to shape the international order through influence, example and largesse. This is particularly true of America in the wake of the 2008 financial crisis and the subsequent Great Recession. At the zenith of its military and economic power after World War II, the United States possessed the material capacity to furnish the international system with abundant financial assistance designed to maintain economic and political stability. Now, this capacity is much diminished.

All of this will unleash growing challenges to the Old Order from ambitious regional powers such as China, Brazil, India, Russia, Turkey and Indonesia. Given America's relative loss of standing, emerging powers will feel increasingly emboldened to test and probe the current order with an eye toward reshaping the international system in ways that reflect their own interests, norms and values. This is particularly true of China, which has emerged from its "century of humiliation" at the hands of the West to finally achieve great-power status. It is a leap to think that Beijing will now embrace a role as "responsible stakeholder" in an international order built by the United States and designed to privilege American interests, norms and values.

These profound developments raise big questions about where the world is headed and America's role in the transition and beyond. Managing the transition will be the paramount strategic challenge for the United States over the next two decades. In thinking about where we might be headed, it is helpful to take a look backward--not just over the past seventy years but far back into the past. That is because the transition in progress represents more than just the end of the post-1945 era of American global dominance. It also represents the end of the era of Western dominance over world events that began roughly 500 years ago. During this half millennium of world history, the West's global position remained secure, and most big, global developments were represented by intracivilizational power shifts. Now, however, as the international system's economic and geopolitical center of gravity migrates from the Euro-Atlantic world to Asia, we are seeing the beginnings of an intercivilizational power shift. The significance of this development cannot be overemphasized.