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Historically, the United States Has Been Able to Use Its Economic Strength and Influence Constructively

• In some cases, the United States has used its influence to encourage or induce other nations to support institutions, programs, and initiatives or has provided substantial financial support.
• In others, the United States had been sufficiently strong and self-confident to promote or preserve institutions or conditions through forbearance, tolerating less-than-ideal behavior from partner countries.

Its Ability to Do so Recently Has Been Mixed

• U.S. successes include organizing international sanctions against Iran; making significant contributions to financial regulation in the wake of the last fiscal crisis; and leading international efforts to enforce prohibitions against money laundering, illegal tax avoidance schemes, and violations of trade sanctions.
• On the other hand, the United States has not provided financial support to its struggling European allies or to Arab Spring nations. And European nations have bluntly rejected some U.S. advice and efforts, citing U.S. debt issues. Failure to come to grips with fundamental issues of government finance cannot be helping U.S. international credibility.

Fiscal Constraints Are Inhibiting U.S. Actions

• They may be undermining U.S. willingness to incur the risks inherent in international leadership and limiting the financial resources to back up international initiatives.
• They are clearly diminishing the U.S. ability to make necessary adjustments at home.