The U.S. has managed to subdue any country that dares to challenge it. It brought Japan to its knees during World War II, caused the collapse of the Soviet Union after the Cold War, and effortlessly subdued Japan and Europe when they challenged its economic power. Now, it’s taming China. But what is the source of this power? It can be broken down into six main factors.
First, the U.S. is the country least affected by trade in terms of national survival. Its export-to-GDP ratio is 11.1% (as of 2023), and its import-to-GDP ratio is 14% (as of 2023), making it the lowest among the G20 countries. This is why the U.S. can afford to impose retaliatory tariffs on imported goods without much concern. Even if other countries retaliate, the U.S. economy will continue to function.
Second, the U.S. has high self-sufficiency rates in food and energy. It is not only self-sufficient in food but also an export powerhouse. In the past, it relied heavily on the Middle East for oil. However, the advent of shale gas has changed the situation. The oil self-sufficiency rate has risen to 60%, and the U.S. now exports oil. This has brought about changes in the geopolitical dynamics in the Middle East. When the U.S. was highly dependent on Middle Eastern oil, it took on the role of the policeman of the Middle East to ensure a stable oil supply. Now, it wants to withdraw. Saudi Arabia is anxious about the U.S.’s move and is pretending to get closer to China to keep the U.S. tied down.
Third, the U.S.’s dominance in currency is impossible. The country uses the American dollar, the top safe asset competing with gold. The current world economy is very vulnerable, but the U.S. alone enjoys a Goldilocks economy because it can issue as much government debt as it wants. The SWIFT network, an interbank communication association, strengthens the U.S.’s currency dominance. For international payments, a communication network between banks is necessary. Being excluded from this network can be fatal in trade. The U.S. can exclude anyone from this network as the U.S. banks are the core force in this network.
Fourth, the U.S. is the supplier of all advanced technologies. Take semiconductors as an example. It’s impossible to design a system semiconductor without the technology of Synopsys, a U.S. company. To operate a semiconductor plant, you will need equipment from the U.S. company Applied Materials. Without products from Nvidia, you can’t run artificial intelligence (AI). The reason why China is losing money in the semiconductor industry is because of America’s power. It’s not just semiconductors. America’s technology goes beyond imagination in quantum computing, advanced biotechnology, robotics, and the space industry.
Fifth, although it’s not as strong as it used to be, the U.S. has the power to rally major countries quickly. It is the leader of the G7. Whenever an incident occurs, it quickly gathers sympathizing countries. When Russia invaded Ukraine, the U.S. excluded Russian banks from the SWIFT network. At that time, over 30 countries, including the G7, the European Union (E.U.), and South Korea, accepted the U.S.’s request for exclusion. The power to unite cooperating countries also shows the country’s strength. Examples include the AUKUS security partnership between the U.S., U.K., and Australia, the Indo-Pacific Economic Framework (IPEF) in which the U.S. and South Korea among 14 countries participate, the QUAD security dialogue between the U.S., Japan, Australia, and India, and the U.S.-led Democracy Summit in which South Korea and 110 other countries participated in.
Sixth, no country can match the military power of the U.S. Its defense budget is staggering. In 2024, it allocated $886 billion for defense. This is 3.8 times the 2024 Chinese defense budget of $231 billion and almost double the 2024 South Korean budget of $492 billion. Furthermore, it is globally the strongest of all weapons. If it chooses to, it can wage any war.
After careful examination, these are shown to be the reasons why the national power of the U.S. is strong enough to gain wisdom for South Korea’s survival. The international order is calculated and ruthless. Like the United States. countries must not be swayed by emotional judgments. The more emotional they become, the more they will suffer.
