Trump May Find Surprise Doesn't Work for a Superpower
One emerging theme of the Trump administration’s foreign policy so far has been destabilization and surprise. President Donald Trump has used phone calls and tweets to shake up previously rock-solid relationships like those with Australia and Mexico. Traditional allies in Europe and Asia are worried about whether they can still rely on the U.S. for protection from Russia and China respectively.
Changing the status quo in surprising ways can be an effective foreign policy strategy, as Russian President Vladimir Putin showed with the unexpected takeover of Crimea and his intervention in Syria.
But there’s a key difference between Russia, a weakened power seeking to improve its position, and the U.S., the world’s reigning superpower. Change and unpredictability favor rising powers. Continuity and predictability favor powers that are already dominant. What works for one kind of power won’t work for the other.
The reason is simple: If you have more, you have more to lose. The U.S., richer and more powerful than its competitors, has further to fall.
The value of continuity and predictability has geostrategic and economic aspects.
The strategic value lies in the peace dividend that the U.S. provides for itself and others by acting as a guarantor of stability. Where everyone knows the rules of the power game, war becomes less likely.
Like the Pax Romana and the Pax Britannica in their times, the post-Cold War Pax Americana has produced a great deal of global stability. A predictable U.S. commitment to peace leads other, weaker countries to behave predictably, too.
Wars often happen when two sides have different assessments of the power balance between them. They need to fight to find out who’s really stronger. If both sides know that they can’t really change the power balance, or fear they will be punished for fighting, they will try to avoid outright hostilities.
Trump believes that beneficiaries of U.S. protection should pay more of the price. That sounds plausible, but there’s a reason that dominant powers don’t try to exact too much tribute from their allies. They don’t want those allies to start thinking that the system disserves them.
What’s more, like Rome and Britain before it, the U.S. has already gained immeasurably in economic terms by its global dominance.
It’s no coincidence that the Information Revolution, which has made the U.S. unimaginably rich by historical standards, happened when the U.S. had become the world’s sole superpower. The Industrial Revolution started in Britain after the defeat of Napoleon. And Rome’s revolutionary economic growth, driven by the creation of astonishing pan-imperial infrastructure and trade, was also the product of its hegemony across Europe and around the Mediterranean.
In all these cases, peacetime investment produced innovation and development that far outstripped growth during wartime. That shouldn’t be surprising, because wars eat up money and human capital voraciously.
Wars destroy vast stores of economic value, as World War I painfully illustrated throughout Europe. The threat of war is reason to keep your money safe.
That’s true internationally as well as domestically. Global economic exchange and growth thrive when there is predictability and stability. No one wants to invest in an unstable political environment.
And no one benefits more from the smooth flow of capital than the country that has by far the most of it, namely the U.S.
Markedly increased instability would be felt first in global markets, to be sure. But eventually, it would reduce the value of U.S. capital markets, too. And even if the percentage market drop was less, the total losses would likely be greater.
Global economic interdependence can’t be reversed by any one country. As a consequence, increased instability anywhere will be felt everywhere.
The upshot of this analysis is that if Trump really wants to make America great again, he’s going to have to change his foreign policy approach. Shaking up the world is going to make America weaker and poorer.
Trump’s impulse to populist isolationism goes back to before World War II, when the U.S. had not yet made the choice -- and the defense investments -- to become a true superpower. Then, there was still a credible choice to be made between entering the global fray and holding back. It took an agonizing period of more than two years, from September 1939, when the war began, until December 1941 and Pearl Harbor, for the country to make that decision and enter the war.
Once that historical process has taken place, however, it can’t be reversed without vast costs.
Today, accustomed to the Pax Americana, nervous allies aren’t going to beg the U.S. to come to their aid. They’re going to start acting as though instability is coming -- which will fuel still greater instability.
In some instances the administration may already have begun to see the value of continuity with existing U.S. policies, as with the recent warning to Israel that new settlements would become barriers to peace.
And Trump hasn’t yet signaled that he will overturn the nuclear deal with Iran. Saying that it was a good deal for Iran, as he recently did, is indirectly a way to encourage Iran to respect it.
It’s only been two weeks. There’s still hope that the Trump administration may settle into a foreign policy of continuity and predictability that actually serves U.S. interests. Otherwise, the only predictable outcome of the next four years will be meaningful U.S. decline.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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