Donald Trump has been sworn in as 45th President of the United States, and delivered a short but savage inaugural address. If he means what he says, he is going to do enormous damage both to the US and to the rest of the world.
Trump should have every reason to be pleased with his inheritance from Barack Obama. America remains the world’s largest economy. In the third quarter of 2016 it was growing at a healthy 3.5 per cent (annualized), compared with 1.5 per cent in the eurozone. Its unemployment rate in November was 4.6 per cent, compared with 9.8 per cent in the eurozone.
But according to Trump, America has enriched foreign industry at the expense of its own, and “made other countries rich while the wealth, strength and confidence of our country has dissipated over the horizon”. His new vision is explicitly protectionist: “it’s going to be only America first, America first…. We must protect our borders from the ravages of other countries making our products, stealing our companies and destroying our jobs…. We will follow two simple rules: buy American and hire American”.
Trump claimed today that protectionism would lead to “great prosperity and strength”. Nothing could be farther from the truth. Protectionism in the 1930s impoverished the world and helped to create the conditions for World War Two. Ironically, it was the General Secretary of the Communist Party of China, Xi Jinping, who this week in Davos made the case for globalization and free trade and explained that there would be no winners in a trade war.
The contrast between Trump’s approach to the rest of the world and Obama’s in his 2009 inaugural address is stark. Obama said that America was “a friend of each nation, and every man, woman and child who seeks a future of peace and dignity”. Trump offered friendship and goodwill with the nations of the world “with the understanding that it is the right of all nations to put their own interests first”.
For America’s allies and partners, who might have hoped that Trump would become a more normal politician as he took on his new responsibilities, this has been a bad week. In two interviews, one with The Times and Bild, and one with axios.com, Trump criticized German chancellor Angela Merkel, and suggested that he trusted Russian president Vladimir Putin as much as he trusted her. He claimed that the EU had been formed “partially to beat the United States on trade”, and that therefore he did not care whether it disintegrated or not. And he promised trade barriers and tariffs.
Trump ran for office telling Americans how badly they were doing. His inaugural address continued the theme. His policy prescriptions promise to make things worse for America and the rest of the world. Ronald Reagan’s presidency is associated with the phrase “morning in America”. For Trump, it is twilight in America, and foreigners made the sun go down.
Ian Bond, Director of foreign policy
