President Trump’s recent comments at Davos, clarifying that the United States does not currently intend to seize Greenland by force, were a welcome respite from the coercive language he and his proxies have been using for the past year. A week prior, Trump posted on social media that acquiring Greenland is “imperative for national and world security — there can be no going back.”
If the president had mentioned the possibility of invading Greenland once in passing and then moved on to an equally ridiculous proposal — like establishing a Board of Peace for Gaza and inviting Vladimir Putin to join — then our allies could take the advice of Trump’s apologists to consider his hyperbole seriously, but not literally. Unfortunately, his consistent commentary indicates Trump genuinely believes there is some undefined American interest in Greenland that can only be achieved by occupation, rather than by working within existing alliances and agreements.
Calculated ambiguity is advantageous when dealing with strategic competitors like China and Russia. In contrast, as a tactic for leading our European partners toward a common goal of securing collective interests, equivocation on whether the United States would invade Greenland was a counterproductive approach which generated uncertainty and resentment rather than clarity. While Trump’s long-term intentions remain unclear, there is one aspect of this sordid drama that is now painfully obvious. The rules-based international order which governed relations between us and our allies from the end of World War II until today is irreparably broken.
Many of the president’s supporters who reflexively adopt his scorn for the complicated and demanding work of building and maintaining alliances cheer the end of that framework. They, and the rest of the American public, are about to learn a very painful and expensive lesson: The 80-year reign of Pax Americana, while funded by the American people, was also subsidized by partners and allies buying our debt and accepting the dollar as the standard reserve currency.
Critics of that international construct observe that America funded it. True enough, but along with being the primary sponsor of it, the United States was also the primary beneficiary. We set up those rules partially as a reflection of our values, but also as a forcing function in service of economic and strategic priorities. The U.S. created NATO and provided significant force structure to it. By doing so, we incentivized our partners to stay inside our tent spitting out, rather than outside our tent spitting in. That is no longer the case.
While Trump was at Davos repeatedly conflating Iceland and Greenland, the Danish Academic Pension fund announced it was selling its entire portfolio of U.S. government bonds. Many European governments will follow suit. As European lenders to the profligate U.S. government depart the market, the fees other less considerate creditors charge to lend us money will increase. There is never a good time for a country addicted to government profligacy to be burdened with increased carrying costs. With U.S. government debt nearing $39 trillion, this seems a particularly inopportune time to be antagonizing friendly governments that lend us money.
Along with increasing direct costs of borrowing, Trump’s foolishness will impose opportunity costs on the U.S. economy. A year after stating that China was the biggest threat to international security, Canadian Prime Minister Mark Carney recently announced a new trade deal with China. Canadian farmers and miners rejoiced because they — unlike their American counterparts — can now export to China. Carney stated, “I believe the partnership (with China) sets us up well for the new world order.” That is not the language of a partner who believes America’s abdication as the leader of the immensely successful old order is temporary.
Trump’s ignorance will impose a strategic cost on America, resulting in decreased cooperation from partners and increased isolation. Beyond that, the American taxpayer will be burdened with increased taxes, inflation and decreased government services as Trump’s counterproductive trade wars and bellicose rhetoric decrease government revenue and increase borrowing costs. What an unnecessary and hopefully temporary sideshow this has all been.