With all its spectacle and chaos, Donald Trump’s shock and awe strategy is both domestic and global. Domestically, Trump and his agents are targeting the American government and the country’s democratic norms, institutions, the rule of law, civil society, the Constitution, overall well-being and sense of normalcy. Trump is ruling as the country’s first elected autocrat; he is quickly acquiring much more corrupt power over all aspects of American life. The Germans have a word for this: “Gleichschaltung.”
Internationally, Trump is embracing a type of militant nationalism whereby the United States is abandoning long-standing alliances and the rules-based international order. This pivot includes enacting a historic global tariff regime and a fundamental reassessment of free trade and globalization.
Donald Trump’s shock and awe campaign has been so effective, largely because he is a high-dominance leader. This is both a strength and a weakness.
Donald Trump’s high-dominance leadership style means that he is willing to smash and bypass existing norms to accomplish his goals. Trump’s MAGA followers love him because of this and how such behavior makes him look like a man of action and a great man of history who is willing to do everything necessary for people like them. This same disregard for the norms and institutions can also create widespread confusion and anxiety, which can ultimately backfire and otherwise interfere with Donald Trump and the MAGA movement’s revolutionary political project.
Instability is antithetical to America’s and the world’s economic stability. Economic instability and the larger societal disruptions it causes are the fuel for authoritarian populism.
The Wall Street Journal and other platforms and spokespeople for the moneyed classes and global capital and finance have been repeatedly signaling their growing concerns about how Trump’s economic policies, specifically his global tariff regime, will cause a recession or depression. To that point, Trump’s initial tariff regime was so disruptive it is estimated that U.S. stock markets lost trillions of dollars in value over a week-long period earlier this month.
In an attempt to make better sense of the Trump administration’s shock and awe (and "shock therapy") approach to the United States and global political economy, the logic of the Trump global tariff spectacle, economic warfare in the 21st century and how these huge questions of global trade and economics impact the pocketbooks and wallets of everyday Americans, I recently spoke with Edward Fishman. He teaches at Columbia University’s School of International and Public Affairs and is a senior research scholar at the Center on Global Energy Policy. Fishman's new book is "Chokepoints: American Power in the Age of Economic Warfare," which has been called “masterful” by the Financial Times and “a compelling and dramatic narrative about the new shape of geopolitics” by the Wall Street Journal.
Edward Fishman previously served at the U.S. State Department on the Secretary of State’s Policy Planning Staff and as the Russia and Europe Sanctions Lead, at the Pentagon as an advisor to the Chairman of the Joint Chiefs of Staff, and at the U.S. Treasury Department as special assistant to the Under Secretary for Terrorism and Financial Intelligence. His writing and analysis have appeared in The New York Times, The Wall Street Journal, The Washington Post, Foreign Affairs, Politico, and on NPR.
What story are you seeing when you view Trump’s tariffs and larger economic shock and awe regime through your expert lenses? What is the larger narrative?
In some ways, Donald Trump’s aggressive use of tariffs marks the acceleration of a long-running trend rather than a break from it. Even before Trump returned to the White House, we were already living in an age of economic warfare. Sanctions, tariffs, and export controls have become the tools of choice for great powers competing with one another. That’s because we’re stuck with a global economy still built for the peaceful post–Cold War era of the 1990s, while the geopolitical environment has turned much more confrontational. Every new tariff or sanction is essentially a patchwork effort to retrofit the global economy for this new era.
What’s unprecedented, though, is that Trump isn’t just targeting adversaries — he’s going after our traditional allies, too. He treats a trade deficit with Canada or Japan as just as dangerous as economic dependence on China. That’s a radically different worldview than past presidents held, and I think it’s out of step with how most Americans see the world. If Trump keeps going down that path, the consequences will be profound. It won’t just be China, Russia, and Iran trying to build workarounds to U.S. power — it will also be Europe, Japan, and other long-time partners. That would accelerate a decline in American economic influence far faster than anyone anticipated.
Do the global financial elite have any use for countries and those dividing lines on maps?
During the height of globalization, the CEOs of big multinational companies could afford to disregard the state. They operated in dozens of countries, made money everywhere, and could shift production around the globe to sidestep rules they didn’t like. But what that generation of CEOs often missed is that globalization also created chokepoints — areas of the global economy where one country, often the U.S., holds dominant power, and there are few or no substitutes.
Take the dollar and the U.S. financial system. Even though the United States makes up less than 10 percent of global exports, nearly 90 percent of all foreign-exchange transactions involve the dollar. Trying to conduct international business without access to the dollar is like trying to travel without a passport — it just doesn’t work. And the U.S. government has the power to cut off any company or bank from the dollar system.
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Now that countries like the U.S. and China have figured out how to weaponize those chokepoints, the state has reclaimed its authority over global commerce. Today, no CEO can afford to ignore the decisions of major governments the way they might have back when you and I were in school.
What is the relationship between economic warfare and hard power (military force) and soft power?
As a former real estate developer who sees international affairs as a series of business deals, Trump relishes that the U.S. controls the key chokepoints of the global economy. It gives him “cards,” as he likes to say. But what Trump misses is why we have those cards in the first place: because other countries willingly tied themselves to U.S.-led systems. They made themselves economically vulnerable to the United States not out of naivete, but because they trusted us not to act arbitrarily or vindictively.
That trust — that soft power — is the foundation of American economic dominance. If we burn that trust, our hard power won't save us. Over time, the economic power we’ve come to rely on will wither too.
Can you offer a recent example of when economic warfare has been waged successfully by the United States?
Economic warfare isn’t inherently a bad thing. When core national security interests are on the line, sanctions and other tools can help the U.S. pursue its objectives without putting troops in harm’s way.
Take Iran’s nuclear program in the 2000s and early 2010s. It was advancing rapidly, and Iran’s then-president, Mahmoud Ahmadinejad, regularly threatened Israel’s existence. At the time, it felt like another war in the Middle East was inevitable. But thanks to a new wave of financial sanctions pioneered by the Bush administration and expanded under Obama, we secured a deal that froze Iran’s nuclear program — without firing a shot. The deal was backed by the entire global community and verified by the International Atomic Energy Agency.
Sure, some Republicans thought the deal was too soft. But even they didn’t question whether the sanctions were effective. In fact, they argued we should’ve pressed even harder and extracted more. That view, in my opinion, overstates what sanctions can do. There’s little evidence that sanctions alone cause governments to fully capitulate. They’re powerful, yes, but they’re not all-powerful. If used wisely, sanctions can give us real leverage. But we need clear, realistic goals and a strategy to reach them. We must also recognize when it's time to take the win.
Donald Trump introduced his global tariff regime in the form of a game show. The spectacle is central to the strategy and not secondary to it. What were you thinking as you watched the Trump “Liberation Day” tariff game show?
A big part of Trump’s political success is turning the presidency into performance art. That was clear in how he rolled out the tariffs — with a Rose Garden press conference and a giant poster of all the rates — as well as how he made the actual decisions. The initial 25 percent tariffs on Canada and Mexico, for instance, came out of an off-the-cuff remark to a reporter during a televised Oval Office session on his first day back.
It’s great television, but it’s not how sound economic policy gets made. It’s not how effective foreign policy gets done either. Publicly browbeating other governments almost always backfires. Foreign leaders have domestic politics too, and if they’re seen as capitulating to an overbearing U.S. president, they pay a price. This is why Trump’s targets abroad have often ended up politically stronger. Their people rally behind them when he attacks.
Donald Trump is a gifted communicator in terms of speaking in an emotionally provocative way and using themes and narrative frames that the general public can understand. For example, Trump tells the American people that they are being scammed and taken advantage of and played for fools and suckers by other countries. Do some translating of sorts. What is true or not about Trump’s claims here?
There’s some truth to what Trump says. If you look at our trade relationships one by one, many of them are lopsided. We run deficits with most partners. Many countries impose higher tariffs on us than we do on them.
But that narrow, transactional view misses the bigger picture. The U.S. let its partners protect certain interests because it built trust and made the whole system more stable, and that system overwhelmingly benefited us. Throughout history, the rise of great powers has provoked backlash and balancing coalitions, but for the United States, quite remarkably, it hasn’t. Since the end of the Cold War, countries have chosen to live under American economic leadership because they saw it as more or less fair.
Trump doesn’t seem to grasp that dynamic. He wants to maximize every deal in isolation whether that is with China, Vietnam, or Lesotho. That “every nation for itself” approach may yield some one-off wins, but it threatens to dismantle the system that made us the world’s economic superpower in the first place.
One of the common responses to Trump’s economic strategy — and his foreign policy more broadly — is that he is using a version of the so-called madman strategy where his apparent unpredictability gives him leverage in negotiations. Your thoughts?
I wouldn’t recommend the madman strategy for managing the global economy. Business leaders need predictability. They need to know whether they can safely invest in Canada or Japan without suddenly facing tariffs or sanctions. If U.S. policy becomes totally unpredictable, companies stop investing, which means slower growth, higher inflation, and eventually more unemployment.
Globally, unpredictability pushes countries to hedge against the U.S. They look for alternatives. Over time, that makes us less central, less trusted, and less powerful. A little unpredictability can help in isolated confrontations. But if the whole world sees us as erratic, we have a big problem.
To that point, did Trump really “blink” on tariffs?
Trump loves tariffs the way some people love their favorite band from high school. No matter how times change, that music still sounds right to him. He decided tariffs were the answer in the 1980s and has stuck with it ever since. At this point, I don’t see him changing his mind. Not many people in their late 70s rethink their fundamental beliefs.
That said, the “reciprocal tariffs” he rolled out in early April were self-evidently a flop. They tanked the stock market and caused upheaval in the bond market. Even Trump can see they didn’t go well. That opens the door for someone like Scott Bessent to propose a new, more coherent Trumpian trade policy. This will still involve tariffs, but more limited and strategic. If Bessent wants to maintain Trump’s ear, though, he’ll have to deliver clear wins his boss can tout.
There is a real risk that the dollar’s status as the world’s preeminent currency for trade and finance could end as a result of Trump’s tariff and larger economic regime. Never mind threats to withdraw from NATO and militant nationalism with threats to Greenland and Canada. What will it mean for Joe Q. Public if the dollar is dethroned as the world’s reserve currency? Moreover, what of the psychological blow to America’s collective sense of identity and American Exceptionalism if the dollar is no longer the world's currency?
For the first time in decades, the dollar’s global dominance is under real threat and the biggest danger isn’t coming from China or the BRICS. It’s coming from us. Trump’s erratic use of tariffs, his disregard for the rule of law, and his meddling with the Fed have shaken global trust in the dollar as a safe haven.
Some in Trump’s camp argue a weaker dollar could boost exports. Maybe. But that would be a small win compared to the losses. If the dollar loses its reserve status, demand for U.S. debt would no longer be guaranteed. To balance our budget, we’d have to slash spending on essentials like healthcare and defense and sharply raise taxes. A weaker dollar would also make Americans poorer — it would eat away at the value of our paychecks and make borrowing more expensive.
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And you’re right: the psychological hit would be immense. The dollar isn’t just currency: it is a symbol of American power. Ironically, Trump himself seems terrified of the dollar being dethroned. He’s threatened 100% tariffs on the BRICS if they launch a rival currency. But instead of rebuilding trust in the system we created, he’s resorting to threats. That’s not how you protect the crown it is how you lose it.
Donald Trump and his messengers have been framing these economic disruptions and chaos as a form of necessary “medicine” that will cause the patient, here being the American people, great discomfort, but in the end, they will get better. As I see it, the American patient is not doing very well in the Age of Trump and his return to power. They are getting much sicker. They are already in critical condition.
It’s true that some necessary economic reforms will involve short-term pain. We’ve become too dependent on adversaries like China for vital goods such as pharmaceuticals, minerals, and electronics. Reducing that reliance will take time, and it will involve costs.
But the tariffs Trump has imposed go way beyond that. They treat any trade deficit as a national security crisis. Whether or not you buy that framing — and I don’t — the level of pain required to eliminate those deficits would be enormous. Full-on economic self-sufficiency just isn’t realistic. It would be exorbitantly expensive, broadly disruptive, and ultimately a fantasy. The pain Trump is inflicting now, I fear, will serve no real purpose at all.
What will happen to consumer goods including food, housing and fuel from Trump’s policies if they continue as expected? The economy more broadly?
Despite what Trump claims, foreign countries don’t pay tariffs — Americans do. A tariff is just a tax on imports. If a U.S. company buys something from China for $100 and there’s a 125 percent tariff, that company must pay $125 to the U.S. government on top of the $100 to the Chinese seller. As long as those tariffs are in place, prices will rise. All kinds of goods will become more expensive.
At a certain point, it just won’t be economically viable to buy anything from China. If a 100-percent-plus tariff stays in place for long, we’ll all but stop importing Chinese goods. The problem is, for many products, there’s no easy substitute. We’d face severe shortages, shortages that will be worse than what we saw during the darkest days of the COVID pandemic. Some hope this will spark a manufacturing renaissance in the United States, but that transition would take many years. In the meantime, businesses would shutter, and jobs would be lost.
Fortunes are literally made during times of economic panic and downturns.
If Trump sticks with sky-high tariffs over a sustained period, the economic pain will be widespread. As we saw during the Biden years, inflation is politically toxic because it leaves nearly everyone feeling poorer. But that pain won’t be evenly distributed. If Trump’s first term is any indication, he’ll likely grant tariff exemptions to favored businesses. Companies with strong ties to the White House may profit disproportionately.
If we end up with slow growth and high inflation — a combination known as "stagflation" — the most vulnerable will suffer more than anyone else. They’re more likely to lose their jobs and less likely to have savings to fall back on. To make matters worse, this is happening just as the Trump administration is slashing government programs. If doubts about the dollar’s future lead to even tighter fiscal policy, the social safety net could wither right when Americans need it most.
The Trump and his administration are withdrawing the country from its long-standing alliances, and generally remaking its relationship to the world in terms of trade and money. What is the best case scenario? The worst?
As I mentioned earlier, today’s age of economic warfare stems from a deeper structural problem: the global economy was built for a time of peace, but we’re now living in a time of great-power competition. Over the next five to ten years, I think it’s inevitable that economic interdependence will progressively unravel.
The best-case scenario is that the U.S. maintains close ties with other democracies — Europe, Japan, Canada — while gradually reducing its exposure to China and other authoritarian regimes. That’s the kind of bloc-based system we were moving toward under Biden. But now, with Trump turning American economic power against friend and foe alike, we risk sliding into something closer to autarky, a world where the U.S. stands alone, detached from any coherent bloc.
That outcome wouldn’t just hurt us economically. History shows that when countries can’t count on trade to secure vital resources, they’re more likely to pursue them through force. My greatest fear is that this age of economic warfare could eventually give way to an age of actual wars. And if that comes to pass, we’ll miss the days when we fretted over the price of eggs.
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