Summary of America's waning power

Overview of America's waning power (Financial Times)

This episode of the Rachman Review examines whether Donald Trump’s second war with Iran marks a turning point in U.S. foreign policy — and whether it exposes deeper limits in American power. Recorded live at the FT Weekend Festival in New York, Gideon Rachman speaks with Kevin Rudd, Catherine Thompson, and Philip Gordon about the Iran conflict, the strain on U.S. military resources, the future of “America First,” and how allies are reassessing Washington’s reliability. The conversation broadens into a larger strategic question: can the U.S. still sustain global commitments while prioritizing China and deterring a crisis over Taiwan?

Core Themes

1) The Iran war as a test of “America First”

• Catherine Thompson argues the Iran strikes complicated the Trump administration’s America First vision by pulling the U.S. back into a major Middle East conflict.
• She says the intervention may have gone too far, but also notes that stopping short of full regime change preserved some strategic discipline.
• Philip Gordon is far more critical, calling the war a “strategic catastrophe” that drained resources, strained alliances, and diverted attention from the Indo-Pacific.

2) U.S. military overstretch and resource depletion

• A major theme is that the Iran operation consumed interceptors, munitions, and strategic assets that the U.S. needs elsewhere.
• Gordon emphasizes the cost in both dollars and capability, arguing the war strengthened Iran economically while weakening the U.S. posture.
• Thompson and Rudd both frame the issue as a “math problem”: the U.S. cannot promise global priorities without the industrial base and budget to back them up.

3) China, Taiwan, and the Indo-Pacific focus

• Kevin Rudd repeatedly links Middle East conflicts to China’s strategic interests, arguing that every major U.S. distraction — Afghanistan, Iraq, Iran — helps Beijing.
• He warns that 2028 could be a particularly risky year for Taiwan, depending on Xi Jinping’s political timeline, Taiwan’s elections, and Trump’s approach to deterrence.
• Gordon says Trump’s rhetoric may be undermining deterrence by lowering the perceived cost to Beijing.

4) Allies remain attached to the U.S. — but with growing caution

• Rudd argues Indo-Pacific allies still see the U.S. as indispensable and largely expect America to remain a Pacific power.
• At the same time, allies are hedging by increasing their own defense spending and exploring closer coordination with other middle powers.
• The discussion suggests a dual reality: continued reliance on the U.S. for security, but growing interest in diversification and multilateral cooperation.

Speaker Takeaways

Catherine Thompson

• The Iran war disrupted a strategic realignment toward restraint and prioritization.
• There may still be a path back to a more focused U.S. strategy, but only if the White House chooses to implement it.
• She is skeptical that Congress will fund the military buildup needed to sustain current ambitions.

Philip Gordon

• The war yielded limited strategic gains and enormous costs.
• He views the settlement with Iran as overly concessive and likely to leave Tehran in a stronger position.
• On Taiwan, he stresses that deterrence depends on making conflict look costly and unlikely to China.

Kevin Rudd

• The Middle East continues to drain U.S. attention and military capacity, which helps China.
• He believes America can still deter China over Taiwan, but only if capability and intent remain credible.
• Middle powers can and should strengthen the international order alongside, not in place of, the U.S.

Main Implications

• U.S. foreign policy is under strain: The episode portrays a country trying to do less globally while still reacting to crises everywhere.
• Deterrence remains central: Whether in Iran or Taiwan, the key question is whether U.S. actions strengthen or weaken deterrence.
• Allies are adapting: Even if the U.S. remains the anchor of the alliance system, partners are increasingly looking to hedge, rearm, and cooperate more closely with one another.
• China benefits from U.S. distraction: The panel repeatedly returns to the idea that every Middle East entanglement reduces U.S. bandwidth for the Indo-Pacific.

Notable Insight

• Kevin Rudd’s “mirror test of Xi” captures the logic of deterrence: Chinese leaders must look at the balance of power and conclude that taking Taiwan is too risky.
• Philip Gordon’s bluntest warning is that Trump’s rhetoric may be making that risk calculus worse, not better.

Closing Note

The episode ends by reinforcing the broader FT theme: America’s power is not simply declining, but becoming harder to deploy coherently. The question is no longer whether the U.S. is still strong — it is whether it can still align its strategy, resources, and political leadership well enough to act like the world’s central power.