"We should treat our allies fairly and respectfully, and our demands should be reasonable, but the time has come to make them."
I'm very sympathetic to the overall picture you present of what the Trump administration *could* aim for, and I agree that such aims would involve some actions in the ballpark of ones it's already taken. I'm sure some figures in the administration hope to achieve something like what you're laying out here.
But Trump himself does so much to undermine the project that I can't really imagine it succeeding. His talk of making Canada the 51st state, or of annexing Greenland--in both cases conspicuously declining to rule out the use of military force--strikes me as something that makes it a lot less likely for our (former?) allies to agree to the kind of arrangement you're suggesting: this kind of talk is not interpreted by our allies as fair and respectful. The surging polling numbers for the liberals in Canada are a reflection of this; Poilievre was the overwhelming favorite, but now anything that looks like sympathy for or capitulation to Trump is politically toxic, and he's likely to lose the election. Even if he wins, it will have been so only because he managed to portray himself as no less hostile to Trump than Carney. It's hard for me not to expect similar dynamics in Europe (not just Denmark) with Trump striking the notes he consistently does. My bet is that getting other countries to go along with this realignment would require giving them a face-saving way to accept it; otherwise, they'll elect parties who make resistance to Trump a core part of their foreign/economic policy. And giving other countries a face-saving way of entering into a new economic order would require a kind of statesmanship and diplomatic touch that is completely counter to Trump's instincts.
“We do not try to run trade surpluses at the expense of other countries, and if we did they would scream bloody murder.”
America runs a very strong services surplus with most of its allies, particularly in tech. Believers in American exceptionalism argue that only America could ever develop such a robust tech industry, but China, a country with a weaker economy and innovation system than Europe, shows that restricting American Tech can lead to the development of (nearly) equally competent tech firms.
The EU welcomed American Tech firms with open arms for many reasons, but some of the strongest ones were linked to the state of the alliance. With the reconfiguration you propose there is a growing movement of thought arguing for much stronger restrictions on the American tech industry in the EU.
A balance in trade goods and defense will be hard to swallow for Europeans without an equivalent rebalancing in services. Considering the strength of American tech firms, I’m not sure this benefits US power in the long run.
"We shall see what Wednesday brings, but I’ll be looking in particular for discernible principles, applied consistently, on predictable timelines. Continued failure on those fronts risks discrediting the entire project and diminishing its prospects of success."
As a political theorist, theorizing comes naturally to you. In theory .... But theorizing veers very easily into rationalizing when we are trying to defend something that is increasingly indefensible. If we're learned anything over the last two months, this admin will not make any honest theorist happy. The tariffs aren't working as planned? Oh, no. Someone is conspiring against us. We need to double down. My money is on people who can't adapt to evidence that should lead them to question their assumptions, not strategic thinkers.
Oren writes: "The model here should be Israel, the American ally that generally asks us to stay home, it can handle its own business, thank you very much."
I guess Oren never ventures out of economics books, because this must be the single dumbest sentence he's has ever written, and truly makes me wonder how he could be so ignorant of Israel's relationship to the US. I say the following as a Jews who is deeply involved in Israeli politics: Israel almost NEVER handles its own business, and would never be able to do what it does without the iron-clad support of the US--often clandestine--which means the US has to physically and financially vanquish its enemies, whether Iraq, or Syria, or Iran, or Libya, or Yemen, and on and on. Israel is entirely dependent on the US for most of its weapons, and to protect them from sanctions at the UN. But perhaps Oren is simply ignorant of geo-politics. But can he really say as an economist that he's unaware that the US has literally evaporated trillions of dollars supporting and protecting Israel from its enemies?
Oren is a very smart guy, and I'll leave out for the moment the morality of what Israel is doing, but if he can't come up with a better 'model' for our foreign relations than Israel, we're really cooked.
Israel has significantly more military capabilities than Japan or any European nation is his point.
The US will be playing a very strong support role in any future Japanese or European rearmament. Right now it is so unbalanced as to be ridiculous...and it has been this was since end of the Cold War.
Who could have possibly known that the very stable genius would struggle to act rationally? Me thinks JD and Little Marco were right about him the first time, before they self-gelded in public... Oren's faith is admirable, if woefully naive. Though I tire of the constant s... talking of my country, I have to admit I enjoy watching folks like Oren as they contort themselves to defend Don's dementia and destruction. Apparently they can't quite accept that government by gas pain isn't likely to succeed. It's sad to say, but I think America needs to get it good and hard from Don and his cult. An extra dollop of irony is knowing that the worst impacts of Don's "plan" will fall hardest on his red state congregation. Good thing our popcorn is homegrown so I can afford it! Good luck America...
I would posit that the US only cares about "balanced trade" because it's currently the loser on some metrics. We don't care about our trade surplus with Netherlands and Uk, South America, etc. - in fact, we like it. If we had trade surpluses with everyone, there would be zero talk of "balanced trade". So let's just be honest. We don't care about balance, we only care about winning. It is not a universalist principled stance, but rather a wholly subjective self serving stance, just like China's. Zero-sum, and no room for lasting peace. If we're talking about what "we" want, let's be honest.
Cass says - "We shall see what Wednesday brings, but I’ll be looking in particular for discernible principles, applied consistently, on predictable timelines." I say - What kind of crackachino is Cass drinking? Trump principled, consistent and predictable? HAHAHAHAHAHAHA! Why bother to write the rest of the article?!?!?!?
You are delusional, the US has started hundreds of conflicts worldwide, it has ruined the economy of many nations and Israel is not your ally at all , they caused you to fight in seven countries that were not your enemy. They like you are full of it. BS.
While the status quo can generally be improved on, scraping it for this “multi-polar” world is a dangerous fantasy. It risks isolating and weakening the U.S. in a relative and absolute fashion.
As you say, the chance of success rests in making our own changes and inducing others to make changes of a kind that are sympathetic to our approach and ends.
Do not count on that working out so smoothly, if at all.
And you make no account for the disruption and pain for many, many in the meanwhile even IF successful. And relative catastrophe if it is not.
The order we helped to create can be worked on, but it should not be scrapped.
It's already a multi polar world as our plan to help China rise post 1989 has succeeded beyond our wildest dreams while the effort to fold China into American hegemony has failed dismally. China does not want to liberalize, Westernize and indeed wants to deindustrialize the rest of the world...and there is nothing the current system can really do to prevent this.
The failure of the current dying (dead?) international system could be simplified to our belief that encouraging China and Russia to join our capitalist free-market system would naturally lead to democratic reforms in those countries and that both countries would find it so beneficial that they would become stakeholders. That failed.
That’s why Cass’s reevaluation of our role and our principles and goals internationally is so useful even in places I think he’s wrong.
But I can’t see any sense at pretending that Trump’s actions won’t benefit Russia and China most of all. It’s like as if a neighbor says your house is a mess and when you say it’s not that bad, your neighbor walks inside with a sledgehammer and smashes your furniture, appliances, and walls. Then he smirks at you and holds a press conference to claim you haven’t kept up your home.
The best argument I can make for this is if you want to see the international trading system changed, short of having a world war, you need to break what is left of the old trading system to convince both business leaders in the US and foreign governments there's no going back.
Then if it goes well we get a Bretton Woods 2.0.
The problem as I see it is Trump has pissed a lot of people off. Yes sooner or later they will have to get over it and come back because they need access to US market, US dollars, US protection and are not going to be happy long term in the Chinese orbit. But Trump makes it less likely they'll come back soon and on terms favorable to US.
wow I just wish the robots input in your comments section here was better. They are terrible! omg! lol sound like children talking.
Keep giving it to them Oren, remember we are in a war, a spiritual cultural war. Keep the faith and keep doing what you're doing. You're on to things when they attack hard. You scare them. The status quo is on their back heels.
Your conditions for balanced trade include removing "currency valuation, industrial subsidies, government procurement, regulatory barriers, wage suppression", which all sounds great but it seems like all those are the things China does, not the US allies? Do Canada, Mexico, Japan or EU countries do any of those things at any significant scale? I think the burden is still on you (and on the Trump administration) to accurately define what is not balanced about trade between the US and its close allies at present. In terms of defense burden sharing, I think you are missing the huge way in which US allies underwrite US defense technology leadership by providing a captive market for US designed, manufactured and controlled weapons and military technology platforms. The billions of dollars it takes to develop these cutting edge planes, ships, artillery, missile systems, etc. are worth it because many customers outside the US sign up to buy the final product. After the "disorienting" moves on trade and the Ukraine war from Trump, all those customers are now reassessing the risk of being part of that defense ecosystem. Will Canada or Europe now ever be willing to put in a purchase order for a Boeing F-47? Maybe the current posturing pushes them to become more self sufficient in defense spending, but that may ultimately come back to bite the US.
The plan to have the US trade be roughly free with Canada and Mexico but not with China won't work because China will just move its production to Mexico and Canada..as they are currently doing with BYD. The architecture of the current system won't work for this reason among others.
The US has no allies, certainly not democratic ones. What used to be called the Free World is an authoritarian mess. France, Turkey and Romania have just arrested the leading opposition candidate. Germany is working up to banning the opposition party and trying to isolate Hungary, contrary to the terms of entry to the EU. UK is prosecuting all sorts of thought crimes with enhanced sentences for white men.
None of this precludes fair trade along the lines suggested. But no trade or defense blocs. The US should not lead such a thing and should actively disrupt attempts by anyone else. And China should not be cast into the outer darkness lest any of our "allies " defect. We need to pay closer attention to their practices but if they agree with the principles, we should be willing to work with them. No permanent enemies, no permanent allies, just permanent interests.
We also have to understand that this essentially destroys our alliances and and we benefit from those alliances to strengthen us as much as anything we provide to them.
"We should treat our allies fairly and respectfully, and our demands should be reasonable, but the time has come to make them."
I'm very sympathetic to the overall picture you present of what the Trump administration *could* aim for, and I agree that such aims would involve some actions in the ballpark of ones it's already taken. I'm sure some figures in the administration hope to achieve something like what you're laying out here.
But Trump himself does so much to undermine the project that I can't really imagine it succeeding. His talk of making Canada the 51st state, or of annexing Greenland--in both cases conspicuously declining to rule out the use of military force--strikes me as something that makes it a lot less likely for our (former?) allies to agree to the kind of arrangement you're suggesting: this kind of talk is not interpreted by our allies as fair and respectful. The surging polling numbers for the liberals in Canada are a reflection of this; Poilievre was the overwhelming favorite, but now anything that looks like sympathy for or capitulation to Trump is politically toxic, and he's likely to lose the election. Even if he wins, it will have been so only because he managed to portray himself as no less hostile to Trump than Carney. It's hard for me not to expect similar dynamics in Europe (not just Denmark) with Trump striking the notes he consistently does. My bet is that getting other countries to go along with this realignment would require giving them a face-saving way to accept it; otherwise, they'll elect parties who make resistance to Trump a core part of their foreign/economic policy. And giving other countries a face-saving way of entering into a new economic order would require a kind of statesmanship and diplomatic touch that is completely counter to Trump's instincts.
“We do not try to run trade surpluses at the expense of other countries, and if we did they would scream bloody murder.”
America runs a very strong services surplus with most of its allies, particularly in tech. Believers in American exceptionalism argue that only America could ever develop such a robust tech industry, but China, a country with a weaker economy and innovation system than Europe, shows that restricting American Tech can lead to the development of (nearly) equally competent tech firms.
The EU welcomed American Tech firms with open arms for many reasons, but some of the strongest ones were linked to the state of the alliance. With the reconfiguration you propose there is a growing movement of thought arguing for much stronger restrictions on the American tech industry in the EU.
A balance in trade goods and defense will be hard to swallow for Europeans without an equivalent rebalancing in services. Considering the strength of American tech firms, I’m not sure this benefits US power in the long run.
"We shall see what Wednesday brings, but I’ll be looking in particular for discernible principles, applied consistently, on predictable timelines. Continued failure on those fronts risks discrediting the entire project and diminishing its prospects of success."
Lol--don't hold your breath, man.
As a political theorist, theorizing comes naturally to you. In theory .... But theorizing veers very easily into rationalizing when we are trying to defend something that is increasingly indefensible. If we're learned anything over the last two months, this admin will not make any honest theorist happy. The tariffs aren't working as planned? Oh, no. Someone is conspiring against us. We need to double down. My money is on people who can't adapt to evidence that should lead them to question their assumptions, not strategic thinkers.
Oren writes: "The model here should be Israel, the American ally that generally asks us to stay home, it can handle its own business, thank you very much."
I guess Oren never ventures out of economics books, because this must be the single dumbest sentence he's has ever written, and truly makes me wonder how he could be so ignorant of Israel's relationship to the US. I say the following as a Jews who is deeply involved in Israeli politics: Israel almost NEVER handles its own business, and would never be able to do what it does without the iron-clad support of the US--often clandestine--which means the US has to physically and financially vanquish its enemies, whether Iraq, or Syria, or Iran, or Libya, or Yemen, and on and on. Israel is entirely dependent on the US for most of its weapons, and to protect them from sanctions at the UN. But perhaps Oren is simply ignorant of geo-politics. But can he really say as an economist that he's unaware that the US has literally evaporated trillions of dollars supporting and protecting Israel from its enemies?
Oren is a very smart guy, and I'll leave out for the moment the morality of what Israel is doing, but if he can't come up with a better 'model' for our foreign relations than Israel, we're really cooked.
Israel has significantly more military capabilities than Japan or any European nation is his point.
The US will be playing a very strong support role in any future Japanese or European rearmament. Right now it is so unbalanced as to be ridiculous...and it has been this was since end of the Cold War.
Who could have possibly known that the very stable genius would struggle to act rationally? Me thinks JD and Little Marco were right about him the first time, before they self-gelded in public... Oren's faith is admirable, if woefully naive. Though I tire of the constant s... talking of my country, I have to admit I enjoy watching folks like Oren as they contort themselves to defend Don's dementia and destruction. Apparently they can't quite accept that government by gas pain isn't likely to succeed. It's sad to say, but I think America needs to get it good and hard from Don and his cult. An extra dollop of irony is knowing that the worst impacts of Don's "plan" will fall hardest on his red state congregation. Good thing our popcorn is homegrown so I can afford it! Good luck America...
I would posit that the US only cares about "balanced trade" because it's currently the loser on some metrics. We don't care about our trade surplus with Netherlands and Uk, South America, etc. - in fact, we like it. If we had trade surpluses with everyone, there would be zero talk of "balanced trade". So let's just be honest. We don't care about balance, we only care about winning. It is not a universalist principled stance, but rather a wholly subjective self serving stance, just like China's. Zero-sum, and no room for lasting peace. If we're talking about what "we" want, let's be honest.
Bilateral trade deficits are not the problem . China runs massive surpluses with the whole world though and is determined to continue this.
Cass says - "We shall see what Wednesday brings, but I’ll be looking in particular for discernible principles, applied consistently, on predictable timelines." I say - What kind of crackachino is Cass drinking? Trump principled, consistent and predictable? HAHAHAHAHAHAHA! Why bother to write the rest of the article?!?!?!?
You are delusional, the US has started hundreds of conflicts worldwide, it has ruined the economy of many nations and Israel is not your ally at all , they caused you to fight in seven countries that were not your enemy. They like you are full of it. BS.
This was one of the stupidest columns I have ever read on substack.
Take Heather Cox Richardson straying from history to shill for Democrats and multiply by one thousand.
"Continued failure on those fronts risks discrediting the entire project and diminishing its prospects of success." This is my worry, as well.
While the status quo can generally be improved on, scraping it for this “multi-polar” world is a dangerous fantasy. It risks isolating and weakening the U.S. in a relative and absolute fashion.
As you say, the chance of success rests in making our own changes and inducing others to make changes of a kind that are sympathetic to our approach and ends.
Do not count on that working out so smoothly, if at all.
And you make no account for the disruption and pain for many, many in the meanwhile even IF successful. And relative catastrophe if it is not.
The order we helped to create can be worked on, but it should not be scrapped.
It's already a multi polar world as our plan to help China rise post 1989 has succeeded beyond our wildest dreams while the effort to fold China into American hegemony has failed dismally. China does not want to liberalize, Westernize and indeed wants to deindustrialize the rest of the world...and there is nothing the current system can really do to prevent this.
Well said Mr. Pete.
The failure of the current dying (dead?) international system could be simplified to our belief that encouraging China and Russia to join our capitalist free-market system would naturally lead to democratic reforms in those countries and that both countries would find it so beneficial that they would become stakeholders. That failed.
That’s why Cass’s reevaluation of our role and our principles and goals internationally is so useful even in places I think he’s wrong.
But I can’t see any sense at pretending that Trump’s actions won’t benefit Russia and China most of all. It’s like as if a neighbor says your house is a mess and when you say it’s not that bad, your neighbor walks inside with a sledgehammer and smashes your furniture, appliances, and walls. Then he smirks at you and holds a press conference to claim you haven’t kept up your home.
The best argument I can make for this is if you want to see the international trading system changed, short of having a world war, you need to break what is left of the old trading system to convince both business leaders in the US and foreign governments there's no going back.
Then if it goes well we get a Bretton Woods 2.0.
The problem as I see it is Trump has pissed a lot of people off. Yes sooner or later they will have to get over it and come back because they need access to US market, US dollars, US protection and are not going to be happy long term in the Chinese orbit. But Trump makes it less likely they'll come back soon and on terms favorable to US.
wow I just wish the robots input in your comments section here was better. They are terrible! omg! lol sound like children talking.
Keep giving it to them Oren, remember we are in a war, a spiritual cultural war. Keep the faith and keep doing what you're doing. You're on to things when they attack hard. You scare them. The status quo is on their back heels.
Your conditions for balanced trade include removing "currency valuation, industrial subsidies, government procurement, regulatory barriers, wage suppression", which all sounds great but it seems like all those are the things China does, not the US allies? Do Canada, Mexico, Japan or EU countries do any of those things at any significant scale? I think the burden is still on you (and on the Trump administration) to accurately define what is not balanced about trade between the US and its close allies at present. In terms of defense burden sharing, I think you are missing the huge way in which US allies underwrite US defense technology leadership by providing a captive market for US designed, manufactured and controlled weapons and military technology platforms. The billions of dollars it takes to develop these cutting edge planes, ships, artillery, missile systems, etc. are worth it because many customers outside the US sign up to buy the final product. After the "disorienting" moves on trade and the Ukraine war from Trump, all those customers are now reassessing the risk of being part of that defense ecosystem. Will Canada or Europe now ever be willing to put in a purchase order for a Boeing F-47? Maybe the current posturing pushes them to become more self sufficient in defense spending, but that may ultimately come back to bite the US.
The plan to have the US trade be roughly free with Canada and Mexico but not with China won't work because China will just move its production to Mexico and Canada..as they are currently doing with BYD. The architecture of the current system won't work for this reason among others.
Tbf to Japan, the "Remember Pearl Harbor!" crowd had to die off before they could begin expanding their military.
The US has no allies, certainly not democratic ones. What used to be called the Free World is an authoritarian mess. France, Turkey and Romania have just arrested the leading opposition candidate. Germany is working up to banning the opposition party and trying to isolate Hungary, contrary to the terms of entry to the EU. UK is prosecuting all sorts of thought crimes with enhanced sentences for white men.
None of this precludes fair trade along the lines suggested. But no trade or defense blocs. The US should not lead such a thing and should actively disrupt attempts by anyone else. And China should not be cast into the outer darkness lest any of our "allies " defect. We need to pay closer attention to their practices but if they agree with the principles, we should be willing to work with them. No permanent enemies, no permanent allies, just permanent interests.
We also have to understand that this essentially destroys our alliances and and we benefit from those alliances to strengthen us as much as anything we provide to them.