-Analysis–
With his MAGA cap, his brash demeanor and his shoot-from-the-hip remarks, Donald Trump seems straight out of a video game. As the leader of the world’s foremost power, he shamelessly breaks conventions — something that appeals to many of his contemporaries accustomed to the freed reign of social media.
His sidekick Elon Musk enhances this image of aggressive force meant to restore America’s strength.
These stances provoke shock and panic in financial markets. “Be strong, courageous and patient — and GREATNESS will be the result,” Donald Trump wrote Monday on his Truth Social platform, as if mimicking Winston Churchill promising “blood, sweat and tears” to his people in 1940.
If the 47th president of the United States seems like an outlier, he still follows a long line of “power moves” by which his predecessors sought major acts of disruption — which ultimately benefited the United States, and were always accepted by the rest of the world.
Will Donald Trump also manage to shape the world economy to his liking, as Richard Nixon, Ronald Reagan or Bill Clinton once did? But this time, can the policy of protectionism serve as a global agenda? That is the question.
There was just as much shock when President Nixon, without warning, announced on August 15, 1971, the end of the dollar’s convertibility into gold. This unilateral decision was driven by necessity. Bankrupted by the Vietnam War, the U.S. could no longer honor the obligation — established by the 1944 Bretton Woods system — to convert dollars into gold (while other currencies were pegged to the dollar, which alone was convertible).
Rise of neoliberalism
The entire international monetary order collapsed in the summer of 1971. The chaos triggered a resurgence of inflation — over 10% per year — and led to the oil shocks of the 1970s.
It also caused a more insidious and lasting effect: freed from fixed exchange rate constraints, states were able to incur much more debt. The U.S. took full advantage of this, but so did France, as we know.
Paradoxically, far from losing the supremacy granted by Bretton Woods, the dollar strengthened its hegemony as the currency of the world’s leading economic and military power. People trust power.
Reagan’s conservative revolution
The next major shift came a decade later with Republican Ronald Reagan’s conservative revolution, from 1981 to 1988. His campaign slogan, “Let’s make America great again,” highlighted the previous decade’s troubles — public deficits, double-digit inflation, and geopolitical humiliations in Vietnam and Iran.
The goal was to restore the virtues of the market over the economic dirigisme.
This time it was a deliberate ideological shift. The Republican administration was rooted in the liberal economic theories of the Chicago School, led by Milton Friedman. The goal was to restore the virtues of the market over the economic dirigisme that had prevailed on both sides of the Atlantic since Franklin D. Roosevelt’s New Deal in the 1930s.
“Government is not the solution to our problem — government is the problem,” became Reagan’s mantra.
The 1980s marked a full transformation of American capitalism, with four key characteristics:
- Systematic deregulation of markets
- Financialization of the economy (“it’s no longer finance that serves business, but business that serves finance,” as the saying goes)
- Decline of unions, with membership plummeting
- Deindustrialization of some regions, notably the Rust Belt in the Midwest
Beyond the U.S., all developed economies adopted neoliberalism. A real success in influence — and American multinationals thrived on it.
Protectionism and territorial imperialism
The third foundational phase of the current world order began with the fall of the USSR in 1991. The end of the communist bloc opened the door to globalization. This was the emergence of a “flat world,” in the words of journalist Thomas Friedman — one dominated by market laws, with free movement of goods, capital and people.
This is the legacy that Trump rejects.
Democratic President Bill Clinton (1992–2000) was an enthusiastic supporter, backing China’s entry into the World Trade Organization in 1998 with these words: “The success of China will affect not only the Chinese people and Chinese prosperity but America’s well-being and global stability as well.” A prophecy that proved quite wrong.
This is the legacy Donald Trump strongly rejects. Hostility toward China, whose rise he seeks to contain, is now the only real point of consensus between Democrats and Republicans.
However, his strategy of protectionism coupled with territorial imperialism (regarding Greenland, Panama, and Canada) is divisive, as it goes against American “exceptionalism.”
The U.S. is a “post-territorial empire,” historian Charles Maier wrote in the early 2000s — unlike classical empires, it doesn’t need to expand territory to export its values and rally the world to its interests. In the new world of Donald Trump, this is not how America looks.
