Every four years, a subdivision of the U.S. intelligence community called the National Intelligence Council releases a special report projecting how the world will change and what it will mean for the U.S. This year's report, "Global Trends 2030: Alternative Worlds," offers some bold predictions (and some unsurprising ones) about what the next few decades could bring.
Like any predictions, they are imperfect, based on current trends and contemporary understandings of how things work. Still, the National Intelligence Council is no joke, and it's worth considering what the report says, particularly about how the status of the world's leading powers might change.
Here, in charts culled from the original report, is the story that the National Intelligence Council tells about the changing nature of global power and what might drive it. These are, it's worth remembering, only predictions.
China to overtake the U.S. as a "global power," around either 2030 or 2040. That's based on these two different ways of measuring a country's power in the world; the former method also has the U.S. dropping behind India by 2050. "By 2030, Asia will have surpassed North America and Europe combined in terms of global power," the report says, "largely reversing the historic rise of the West since 1750."
Elements of power will still favor the U.S. in 2030, with China and India catching up. This below chart uses a different metric than the line charts above; it breaks down different forms of national power into several discrete categories. This metric still has Uncle Sam on top of the world in 2030, by a combination of military power, trade with and aid to other countries, and technological research perhaps most of all. Human capital and GDP will increasingly favor China and India, which are much larger than the U.S. Notably, three of the world's top four powers will be Asian and none of them will be European.
Middle class consumption in China and India to grow dramatically, overtaking the West's. The report predicts that the global middle class will triple by 2030 from one billion to three billion, much of that growth in China, India, and elsewhere in Asia. That means that middle class consumption – a major driving force in the global economy – will increasingly come from Asia rather than the West.
Financial assets are shifting to emerging economies. The chart below shows how global financial assets are divided across the world's economies. As of 2000, the U.S. and Western Europe had more than a third each; that proportion has shrunk considerably, moving to China and other emerging economies. That's a trend that the report says will continue, with Japan doing particularly poorly as its population declines.
The rises of China and India will be faster and more dramatic than that of the West. This chart captures, perhaps better than any other, just how historic China's and India's growth rates really are. They show the average increase in each world power's share of global GDP during that power's rise. In other words, during the U.S.'s rise to global power between 1900 and 1950, its share of the world economy grew by a world-changing 2.2 percent every decade. China's currently ongoing rise is, by that metric, well over twice as fast. That's amazing, and India is projected to just about match it.
Bottom line, the economic rise of Asian giants India and China is likely to have drastic implications for the world, the balance of power, and America's place in it.