2026 Got off to a Turbulent Start – With Consequences
If further confirmation were needed that the US cannot recognise partners, but only submissive vassal states, then the demand for Greenland’s handover was a rude awakening.
It is striking how harshly Trump had to treat the Europeans before clear resistance emerged. This resistance also spread to the right wing of European politics, whose members had previously expressed sympathy for MAGA.
Europe is dependent on the US and its hyperscaler companies in many ways. It seems futile to think that this dependence can be eliminated, or even alleviated to a satisfactory degree.
It’s hard to imagine life without Microsoft, Amazon, Google or WhatsApp.
However, this will also need to be taken into account.
The UK is Considering Improving its Trade Relations With China
Six months ago, this seemed highly unlikely. However, pressure from the Trump administration is leading to unusual developments. Ultimately, global challenges cannot be solved if rigid blocs emerge.
Mark Carney, the PM, Repositions Canada as Open and Welcoming
Canada no longer views the United States as a reliable and steadfast partner either. Canada has a lot to offer, including raw materials and energy, as well as industry and a market of interest to other countries. Its cooperation with South Korea in automobile production and purchase of submarines from South Korea speak volumes about how much its relationship with the US has deteriorated.
The Damage Caused by Trump Will Be Hard to Undo, if Not Impossible
As the world’s hegemon, the US finds itself in the unenviable position of having largely exhausted its financial resources. It will now have to start taxing its own wealthy population, who could easily bear the burden of the state’s financial difficulties. However, this is not acceptable to a ‘democratic government’, which is certain to be voted out of office within two years. Given the current level of animosity between the Democrats and the Republicans, it is almost impossible that a national alliance will be formed to restructure the country in a way that would still allow it to maintain its dominant position.
It is much easier to exert pressure on foreign countries and their allies. The introduction of tariffs is reminiscent of the tithe that medieval nobles demanded from their subjects in exchange for the promise of protection (though not from the nobles themselves). Unlike in the Middle Ages, we are educated today and do not believe in a divine order that places the US above us. I believe that Americans’ behaviour cannot be changed because they will not unite nationally unless they are under immense pressure. This would be easy to achieve, as an analyst at Deutsche Bank pointed out, with negative consequences for the bank. They said that it would be easy to discipline the US by selling US stocks and bonds on the market. Our only consolation may be that the US is well aware that the analyst is right. The US is in a position similar to Argentina’s in 2001. The only advantage it has is being indebted in its own currency. However, the US is even more dependent on foreign countries than Argentina was. Even compared to Europe, the US service trade surplus is greater than the goods trade deficit. The US capital account is -100% (more foreign assets in the country than vice versa), which is a gateway to considerable problems.
