> it did not internationalise that the West was no longer dominant
Given "the West" means so many different things (sometimes including Australia), I'm not sure what you're aiming for here? Rise of China? Certainly this has been recognised. If you mean all of Asia, in the same way that the UK is in Europe but not part of the EU, then I agree: I don't think many have fully internalised how important India, let alone Pakistan, Taiwan, South Korea, Singapore, have become.
> It has also not understood its diminishing importance to the US in the world in which its economy is proportionately so much smaller, and the rival superpower is in Asia, not Europe.
The phrase "when America sneezes, the world catches a cold" comes to mind. I'm told that dates to 1929. More recently, my understanding of the Suez crisis was that the US convinced the UK to back down just by threatening to flex one economic muscle; by some measures, that point represents the end of British dominance on the world stage.
But I would say that here, it is America rather than Europe which does not understand its ranking in the world: two of the common ways of measuring economies are nominal-GDP and PPP-GDP, by the former the EU is comparable to China with the US way ahead, by the latter the EU is comparable to the USA with China way ahead. In both cases, the EU knows it's not #1.
That said, during Brexit, there did seem to be a lot of unrealistic exuberance from Leave voters, so perhaps the lack of awareness runs deeper than I perceive…