Fareed Zakaria is the editor of Newsweek International, in which capacity he appears regularly on panels dispensing wisdom and prophesy. Zakaria has what economists call the comparative advantage in the cutthroat world of wonkery of being a youngish Indian transplant, thus putatively better placed than US-born palefaces to describe what he calls “the post-American world”.

Zakaria’s global assessment goes as follows: Americans should stop feeling so gloomy and fearful. By broad historical standards they live in a peaceful era. The problem of “terrorism” is vastly overblown, Al-Qaeda and the antics of “rogue states” are minor perturbations amid steadily increasing world prosperity induced by globalisation and free trade. Realism is the antidote to panic, and, if rational, Americans should accept that the nation’s economic and hence strategic dominance in world affairs is over. China and India, endowed with vast territory and huge populations, are the new heroes of this next chapter. America should discard the vestments of imperial arrogance and self-centred ignorance about the rest of the planet. Its prime problem is political gridlock which prevents enduring problems — fleetingly identified as “healthcare, social security, tax reform” — from being addressed in a spirit of bipartisanship.

Zakaria’s essay never strays into the perilous embrace of an original idea which might discomfit his core audience of corporate titans clustering at Aspen, Davos, or Ditchley, not to mention employers in the communications industry, think tanks or the apparat of “national security”. History rattles by at the brisk clip of a television documentary, with its usual cargo of clichés. “It was not the Great Depression that brought Hitler to power, but rather hyperinflation, which destroyed the middle class by making its savings worthless.” Actually the hyperinflation of 1923 stimulated the German economy by wiping out savings and accelerating consumption. In contrast to the bouncing Weimar economy (between 1923-29 it was the third most vibrant in the world after the US and Canada), Britain limped through the 1920s, shackled by a return to the gold standard and an overvalued pound. What brought Hitler to power was deflation, falling prices and 40% unemployment.

The error is telling, because it presages Zakaria’s myth-making claim that the neoliberal precepts that became dominant in the 1970s have been an unqualified success. Anything that might slow “market forces”, or “market driven industrialisation”, elicits a reproving finger-wag from Zakaria, nowhere more so than in his chapter on India, a paean to the “reforms” that began in the 1990s. Zakaria acknowledges that there are still a great many desperately poor Indians, but “even if the India of poverty and disease is the familiar India, the moving picture is more telling than the snapshot. India is changing. Mass poverty persists, but the new economic vigour is stirring things up everywhere”.

Yet 836m Indians live on less than 50 cents a day and for many, the era of “reforms” has worsened their condition. In 2007, the same year India’s billionaire rating went to four, behind the US, Germany and Russia, the country slipped from 126 to 128 in the “human development index” set by the United Nations.

Though he manages a quick mention of sub-prime mortgages, Zakaria wrote this book before the economic agitations that have prompted George Soros and Alan Greenspan to declare that America is facing the greatest economic crisis since the Depression. Panglossian cantatas to market forces are no longer in vogue, or are now set in the more speculative mode of “hope”, touted by Barack Obama. So Zakaria’s book has a slightly dated feel, even if there are corrections in political outlook from the Bush years, such as the demure footnote on page 223 conceding that the author was wrong in his full-throated support of the attack on Iraq, an enterprise for which he now concedes “the costs have been ruinously high”. (In the pre-war phase Zakaria was part of an informal, unpublicised group advising Donald Rumsfeld, the former US defense secretary.)

If Zakaria wants to reposition himself for the new era he will have to go far beyond the usual mantras about “reforming” Medicare and social security. In America, as in France and Spain and India, life is getting harder for most people, albeit more flush for the thin tier at the top. Former US treasury secretary Lawrence Summers recently reversed the famous 1953 dictum, “what’s good for General Motors is good for the country”, admitting that there was “a growing recognition by workers that what was good for the global economy and its business champions was not necessarily good for them”. Now, there’s a genuinely discomfiting idea.

The Post-American World by Fareed Zakaria

Allen Lane £20 pp304

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