Colin, America is a great country and a super power right now. But, what concerns me is how the big picture looks.
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I don't think there's any indication of America slipping at all. Are we in a better shape today than during the Vietnam era? How about compared compared to the McCarthyism era? How about the Great Depression? I think we are.
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There is one major difference I see that does not bode well for America. During the Great Depression, America was the worlds largest creditor nation. Today we are the largest debtor nation in history. I believe that our vulnerabilities lie in our leverage, our derivatives, our monetary system, those leading us and our collective attitude/philosophy/ignorance as a populace.
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Personally, I look around and see an extremely busy consumer driven society and an improving style of life.
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Case in point.... I think this is another bad sign. An economy driven disproportionately by consumer consumption. Consumer debt is very high. Consumer savings are very low. Credit is the only thing keeping us afloat and it cannot be perpetuated forever.
I think you have to look at the Gov't as an extension of ourselves and ask yourself if the policy is sustainable. They take in a large portion of our income and utilize it to run the country. I think we all can agree that Gov't is doing things that NO private corporation or individual could (they would be bankrupt by all definitions). For instance, the General Office of Accounting says hey, we can't find 18 billion dollars. We do not know where it went. The Gov't books make Enron look like a picnic. Yet, the public just turns a blind eye and keeps on hocking themselves further into debt. In turn, the Gov't continues the same juggling act, trying manipulate the "natural forces" by playing with the money supply, etc.
IMHO, the bottom line is that you can never run away from the natural balancing act of nature -- growth and decay, catastrophe and renewal, etc. A period will come (a cycle) that will contain the decay and catastrophe phase (just like the stock market, which many people thought would never decay). The excesses will be unwound and when the momentum shifts it will be unstoppable. History has proven that this is highly likely (if not inevitable).
I think there are real reasons for concern, but also there is nothing one can do to change the inevitable (just like we could not stop the Naz from losing 80%). The only thing we can do as individuals is objectively observe and plan accordingly.