You're not making a cogent argument.

From most perspectives (civilian, political, financial), the "better" military is the one that wins. Your'e arguing that a navy can be a shadow of its former glory and still also be what is understood as "better" by most people. This doesn't make sense.

phil21 makes a relevant point that navies are used for different purposes, and the current US Navy is tuned for a different task than that which it currently faces in the Gulf.