Since its victory in the Cold War, the US global hegemony has rested on three pillars: economic power, military might and a vast capacity to export its popular culture. The recent emergence of additional powers -- the EU, China, India and a Russia driven to recover its lost status -- has eroded the US' capacity to shape events unilaterally.
Even so, the US remains by far the world's most powerful country; its decline has more to do with its incompetent use of power than with the emergence of competitors. It is US leaders' "suicidal statecraft," to use Arnold Toynbee's pithy phrase for what he considered the ultimate cause of imperial collapse, that is to blame for the US' plight.
Consider the Middle East. Nothing reveals the decline of the US in the region better than the contrast between the US' sober use of power in the first Gulf War in 1991 and the hubris and deceit of today's Iraq war.
In 1991, the US forged the most formidable international coalition since World War II and led it in a fully legitimate war aimed at restoring regional balance after the late Iraqi president Saddam Hussein's invasion of Kuwait. In 2003, the US went to war without its trans-Atlantic allies after manipulating false assertions. In doing so, the US embarked on a preposterous grand strategy that aimed no less at simultaneously dismantling Iraq's tyrannical regime, restructuring the entire Middle East, destroying al-Qaeda and helping democracy to take root throughout the Arab world.
The result has been utter failure: military defeat and a severe degradation of the US' moral standing. Rather than undermining radical Islam, the US has legitimized it, in Iraq and beyond. Indeed, what will now shape the future of the region is not democracy, but the violent divide between Shiites and Sunnis that the Iraq war precipitated. It is this Muslim civil war that is allowing al-Qaeda to gain a larger pool of recruits.
With Iraq probably becoming the first Arab country to be ruled by Shiites, and hence integrated into an expanding Shiite Iranian empire, the US' Sunni allies in the region now view the US as unreliable. Indeed, the US is seen as practically complicit in inciting a monumental reversal of Islam's fortunes, the Shiite revival. Nor is the gospel of democracy especially dear to the US' Arab allies, for the call to democratize has only emboldened the Islamists to challenge the incumbent elites for power.
Admittedly, violent Islamic fundamentalism has deeper roots in the fading promise of Arab nationalism. But the US' misbegotten democratic message has ended up alienating both its conservative regional allies, as it gave a new lease on life to political Islam, which can use the ballot box as a route to power, and the Islamists, whose electoral gains are then rejected by the US.
The US' biggest strategic blunder in the Middle East arguably concerns the emergence of Iranian power. By destroying Iraq as a counterbalancing regional force, the US dealt a major blow to its traditional Gulf allies, for whom Iraq served as a barrier against Iran's ambitions. The US offered Iran on a silver platter strategic assets that Grand Ayatollah Seyyed Ruhollah Mosavi Khomeini's 1979 revolution failed to acquire either in eight years of war against Saddam or in its abortive attempts to export the Islamic revolution throughout the region. Likewise, Iran's nuclear program gained momentum thanks to its sense of impunity following the colossal failure in Iraq of the US' concept of "preventive war."