Grand Illusions: Critics and Champions of the American Century.

A test. Which president said this and when: The United States "possess[es] the strength and the will to bear the burden of world leadership....Through strength of example and commitment we lead....Our example reshapes the world." And, shortly later: "I have no doubt America will transform the world. We begin with the free market, the powerhouse of ingenuity. Free markets and free people breathe life into the American dream."

Is this Teddy Roosevelt, speaking as the United States dawned as a world economic power? Is this Harry Truman, asserting our nation's premier place in the postwar world?

Neither. It's George Bush, speaking in 1991 as if the cold war hadn't ended, as if the U.S. economy were not in indisputable decline, and as if the bipolar superpower world were not now multipolar. Castigated for his famous dismissal of "the vision thing," George Bush in fact is caught in the throes of a compelling vision. The problem is that the vision is out-of-date: The captain of our ship of state has an obsolete map, and in such cases the nation will surely founder.

This, the frequent failure of our leaders' vision in the twentieth century, is the main theme of John Judis's rewarding book and the "grand illusion" of its title. A veteran journalist, Judis has examined the political perceptions of fourteen leading politicians and intellectuals, including New Republic founder Herbert Croly, Walter Lippmann, Whittaker Chambers, William Fulbright, Ronald Reagan, and George Bush. Each is the subject of a mini-biography, including not only an intellectual and political profile but a psychological one as well. A liberal perspective unites these varied topics; conservatives will find much to criticize. And, in my opinion, they have their work cut out for them.

While Judis analyzes domestic policy to some extent, foreign policy is the heart of the work. The central topic therein, of course, is the rise and decline of the cold war, and how our leaders have answered all the subsidiary questions involved: What is the nature of the Soviet Union? What are the interplay and relative strengths of nationalism and communism in the third world? As they recover from World War II, what roles will Japan, Germany, and Western Europe take in geopolitics? What will the post-cold-war thaw mean for the United States?

Some leaders had 20-20 vision. In a 1971 speech in Kansas City, for example, Richard Nixon floated five global propositions: the cold war is ending; economic competition will replace military competition among nations; the United States is declining from its postwar predominance; the bipolar world is giving way to a multipolar one; and as international economic competition grows, U.S. relations with its cold war allies will become uneasy.

Prophetic, no? Nixon and Henry Kissinger eventually faltered over Vietnam, of course, but at least they saw the world clearly. Much the same can be said about Lyndon Johnson. But, Judis says, this is emphatically not so with Ronald Reagan and George Bush, who won and retained the White House with an "imperial nostalgia" that has blinded the nation to new world realities. Knowing the power of wishful thinking, Reagan and Bush simply denied that America was on the decline. This grand illusion - some might say delusion - led to absurdities. As Mikhail Gorbachev was dismantling the Warsaw Pact, for instance, National Security Advisor Brent Scowcroft was announcing on television that "the cold war is not over."

What fosters such lack of vision? All the limits that humans are heir to, Judis answers, from emotional need (Whittaker Chambers) to the enchantment of nostalgia (Ronald Reagan) to a paucity of reflectiveness (George Bush) to the seductiveness of simple ideas (various intellectuals). Judis tells us too about those with strong vision, people like columnist Walter Lippmann and Arkansas Senator J. William Fulbright, both of whom sharply decried the simplistic good-versus-evil reading of the cold war.

For Judis, the sad current state of U.S. leadership contrasts greatly with the start of the American Century. In the early 1900s, the world was also in flux. The United States was growing from an agrarian nation to an industrial power, and Britain's longtime world dominance was receding. Old U.S. approaches, such as isolationism, just didn't make sense anymore. Fortunately, the nation and its leaders, like Teddy Roosevelt, were perceptive enough to see these truths. Not so now, says Judis.

The difference between Roosevelt and Bush is, unfortunately, the difference between the beginning and the end of the American Century," he writes. "At the beginning of this century, Americans grasped, however imperfectly, the novelty of their situation and attempted to come to terms with it....In the last decades of the century, Americans fell prey to nostalgia.... They nourished illusions about the power of the market and about America's standing in the world....But if we want to halt our nation's descent, we, like the Americans of the progressive era, will have to recognize the difference between style and substance and reality and illusion."

A rich book, Grand Illusions offers much more than foreign policy analysis. Judis scrutinizes U.S. domestic policy, too, from Henry Wallace's pioneering New Deal farm price supports to Congress's 1979 Chrysler bailout, with particular attention to the ebb and flow of the laissez faire and mixed-economy approaches. The reader also gets a feel for the lineage of ideas. For instance, Whittaker Chambers took a religious view of the cold war as a struggle between "two rival faiths." This image deeply impressed Ronald Reagan, whose similar formulation tagged the Soviet Union as the "evil empire" and endured well into George Bush's presidency.

And Judis gives the reader his due of political tidbits. For example, we learn that Barry Goldwater said NATO field commanders should have the right to use nuclear weapons. And Henry Wallace, a progressive visionary, may have been a bit too visionary when he visited Siberia in 1944 and came back gushing about how he saw the future and how wonderfully it worked. Turns out he saw a slave-labor camp, cleverly masked for his tour.

Indeed, the book may be too rich. Spanning a century, Grand Illusions is both an intellectual history and a political history, of matters both foreign and domestic, with psychobiographies as well. I would have trimmed the subject matter a bit - but that is an editorial quibble. More important is that this fairly well-done book is also a must-read book as the elections loom. This nation is at a critical crossroads, and Judis makes a compelling albeit partisan argument that its leaders are several miles back down the highway.