The Shifting Landscape of U.S. Economic Power
Over the past two decades, the United States has developed an extensive arsenal of economic security tools that have become central to its foreign policy. Both Republican and Democratic administrations have contributed to this development, creating a shared understanding of how to pursue American interests globally. Economic security officials have worked across party lines, gradually expanding the country’s economic influence through financial sanctions, export controls, and technological advancements.
However, the incoming Trump administration presents a significant challenge to this established framework. The new administration is characterized by diverse factions, including traditional economic-security technocrats, crypto enthusiasts, Wall Street supporters, and America Firsters. This internal dynamic, combined with President Trump’s tendency to engage in public disputes with other countries on social media, may lead to a scenario where the global dependence on U.S. economic power begins to erode while the machinery of that power potentially weakens from within.
In the final days of the Biden administration, there was an attempt to shape the incoming Trump’s agenda. Just before Trump took office, the Biden administration released a plan aimed at maintaining U.S. dominance in global artificial intelligence. This document represented the culmination of years of effort to leverage technological and economic advantages to sustain American power.
However, Trump’s approach to policy has been markedly different. A notable example is the confrontation with Colombia, one of the U.S.’s closest allies in Latin America. When Colombia refused to accept two military planes carrying deportees, Trump threatened to impose severe economic sanctions and tariffs. The crisis was eventually resolved through a compromise, but it highlighted the shift away from decades of carefully crafted policy understanding towards more impulsive decision-making.
The contrast between the comprehensive plan for AI dominance and Trump’s 190-word post on Truth Social encapsulates the change in approach. As the Trump administration navigates its economic policies, the world will be watching to see how these changes impact the global economic order and the machinery of U.S. economic power.
