Trump’s appearance at last month’s World Economic Forum in Davos was about one thing: showing off who the rich and powerful are. As his Commerce Secretary explained at a Swiss resort: “With President Trump, capitalism has a new sheriff in town.”
In the run-up to the summit, Trump escalated threats against Greenland, forcing Western leaders to finally recognize that beneath the bluster, Trump may be serious about shaking up their world. Combined with Trump’s invasion of Venezuela and ongoing tariff wars, the United States president’s actions suggest an emerging model of capitalism that relies less on market rules and more on direct state coercion and geopolitical competition.
Canadian Prime Minister Mark Carney put it plainly when he said Trump represented “rupture, not transition.” The international rules-based order is characterized by hypocrisy and double standards, Carney argues, but even so, this American-dominated economy has given some stability to countries like Canada; Today, “this deal no longer works”.
Carney is right. Trump is at the forefront of efforts to change the international system. And that means changing the way capitalism works.
For decades we have been living under a neoliberal form of capitalism. In theory, this system was based on the rule of the free market. In reality, it was a highly monopolistic system, in which major decisions about how we live were made by a more concentrated group of business leaders and wealthy investors. Such a system has fueled historically unprecedented levels of inequality and environmental destruction, and undermined democracy where it barely functions.
We’ve been here before. In the late 19th century, the globalized “free market” economy also created massive inequality, dominated by a small number of predatory industrialists and financiers. As these commercial empires worked to expand their markets around the world with nation-states, war became inevitable.
In some countries, fascist leaders came to power, swept away the democratic opposition of business titans, merged them into an aggressive nationalist project, used the full power of the state to make corporate profits, and subsumed those profits into a project of world domination. In many ways, fascism was the ultimate expression of monopoly power. Fascist economies were characterized by the fusion of state power with corporate monopoly, the mobilization of industry for nationalist expansion, and the suppression of democratic economic oversight.
Trump represents something like that. He will use economic or military warfare to get his way, and is clearly using state power to enrich the largest corporations in history, increasing state subsidies and public protection to unprecedented levels.
But Trump is not controlled by business leaders; Rather, he wants to change the way they operate. Trump often clashes with “woke” corporate bureaucrats, bullying them into joining his political project, just as fascist leaders did a hundred years ago.
Hence, Trump’s interest in intervening in countries in a way that confuses many in the business world. Trump said his attack on Venezuela was about oil. And yet, many oil companies are reluctant to invest. Trump’s ambassador to the United Nations said his interest in Greenland is about controlling vital minerals needed to make military and other high-tech products. But digging it into the professional world is difficult for many to contemplate.
Some argue that Trump is only interested in enriching the speculators around him. And there’s certainly something to it — check out the hedge funds that allegedly made a killing over Trump’s threat to intervene in Venezuela. But there is something deeper. Trump sees the world as one great rivalry, with China as America’s main competition, but Europe must also know its place. To maintain US hegemony, control over resources, even those buried underground, is essential, not least because someone else can grab them.
Trump’s plan – though open to change, and implemented in a deeply erratic, sometimes contradictory manner – is for a world where international law is completely replaced by the rule of thumb. In turn, this is a reaction to the volatile dynamics in the global economy. Because of this, he is likely to outlive Trump. So we cannot wait for elections to save us. If we want to defeat Trump’s politics, we must stand by him.
Carney proposed a new coalition of “middle powers” in Davos to replace dependence on the US. This is undoubtedly important, but it is only part of the answer. Carney’s vision of this alternative alliance focused on signing more deregulated, free-market trade deals, replacing one form of globalization with another.
It’s time Western leaders learn that you can’t beat fascist economics with neoliberalism. We need a truly democratic form of economics. This means creating a system where public investment, democratic accountability and economic sovereignty take precedence over corporate concentration and speculative finance. And that’s possible, because countries can start rewriting the rules of the economy while retaliating against Trump and breaking America’s dependence.
Retaliation against Trump should not be viewed solely through the lens of rising tariffs. Limiting US corporations’ access to procurement contracts, refusing to cooperate on intellectual property rules, and regulating finance and technology will all hurt Trump’s allies and help our countries develop sovereign economic policies that can put the needs of ordinary citizens at the center. Notably, such policies have clearly been put on the table in discussions over the EU’s so-called “trade bazooka” threatened over Greenland.
This will mark the beginning of something truly different. Trump’s rise is frightening, yet it presents an opportunity, long overdue, to move toward a more democratic economy, to stop and reverse inequality, to restore our environment. Trump’s politics are not an anomaly but a symptom of a deep failure in the global financial system. And that way is the only way to prevent fascism, because economic systems that concentrate power and wealth inevitably create fertile ground for authoritarian rule.
The views expressed in this article are the author’s own and do not reflect Al Jazeera’s editorial policy.