Relations between Europe and the United States are at a watershed. The post World War II global settlement is no longer anchored in contemporary economic and political realities. The Soviet Empire has crashed and burned. Emerging from the ashes, Russia is barely more than a Third World country with nuclear weapons. In Asia, Japan's new postwar generation of politicians increasingly demands that Japan become "a normal country" as China emerges from the shadow of the Soviet Union and threatens to become the East's counterweight to the U.S.

Politically, the Bush presidency represents an ideological position at odds with Europe's predominant center-left governments and, if his campaign rhetoric is to be believed -- not always true of politicians -- a foreign-policy stance devoted strictly to U.S. interests.

But what many Americans fail to realize is that another superpower is being born in the West. Even without the next phase of enlargement, the European Union is bigger and wealthier than the U.S., it's the largest international aid donor in the world and it's on the verge of introducing a new single currency, the euro, which threatens to challenge the dollar's monopoly in the international currency markets.