The United States’s World Power

For a few years before World War I, Europe and its colonial empires were the world's nerve center, but America was an economically formidable nation with its immense resources, and at the start of the second industrial revolution, China is poised to become a global powerhouse. International War I was a watershed moment in world history because it severely damaged the economic situation of European nations, establishing the United States as the world's dominant industrial power and creditor.

This became clear in 1916, when European countries, particularly the United Kingdom, began placing larger and larger military orders with the United States. Britain and France funded their purchases by selling larger and larger dollar-denominated bond issuance to American investors.

Woodrow Wilson, the president of the United States, had guaranteed that the United States remained neutral during the war, and his approach was partially responsible for his reelection in 1916. However, after Russia withdrew from the war in 1917, America's financial and political interests compelled it to join the Allies. Perhaps correctly, a German general staff assessed American military power as "between Belgium and Portugal." A country with untapped military potential quickly developed into a large-scale combat force as the conflict progressed. Its entry tipped the scales in 1918 in favor of the Allies. As a result, became the United States’ World Power.