Last week marked the World Economic Forum – called Davos after the alpine town the conference is held in. Davos brings together captains of industry, political and thought leaders, and journalists in a four-day conference to discuss the world’s issues.
This year, President Trump visited the conference – the first sitting president to visit Davos in eighteen years. After two years of populist, anti-globalization speech, his attendance seemed to be an attempt to trying to wrest the geopolitical narrative out of China’s hands. Unfortunately, his recent policy initiatives and weak rhetorical backtracking doomed his efforts long before they began.
Many world leaders made speeches decrying Trump’s “America First” policy initiative – including France’s President Macron, Italian PM Gentiloni and Indian PM Modi. Even the topic of this year’s conference – “Creating a Shared Future in a Fractured World” – seemed a rebuke to Trump’s particular flavor of economic protectionism. Meanwhile, China seemed all too eager to step into the void left by America’s abandonment of the global stage by expanding it’s “One Road, One Belt” initiative to nations in South America.
Trump’s separation from the international community has been a long time coming. In particular, Trump’s resistance to trade agreements and international treaties has disconcerted allies and trading partners alike. His presidency has been marked by withdrawing from American drafted and previously negotiated agreements like the Trans-Pacific Partnership and the Paris Agreement. Those agreements that have been executed, Trump threatens to rip up if not renegotiated – like the NAFTA and NATO agreements.
When not targeting treaties directly, Trump seems keen to violate the spirit multilateral treaties. Despite the rules of the World Trade Organization and rulings from that body, Trump has instituted and threatened various unfair and illegal tariffs – like the recent order on washing machines and solar energy cells, and his threatened action on steel, aluminum and other Chinese products. Tariffs like these were attempted during the Bush administration, but the WTO declared them counter to the agreement and they were removed.
These actions have illustrated to the international community a fundamental untrustworthiness from the American head of state, and signaled an unwillingness to trade fairly.
Moreover, Trump’s constant, harsh anti-immigrant talks have put him at odds with many allies – especially when he targets refugees. Australia, Germany, and several other countries have condemned his speech and actions – especially his efforts at reneging on deals made during the Obama era relating to the settlement of refugees. Unfortunately, Trump has stuck to his guns regarding these issues, figuratively thumbing his nose at the international community.
Trump’s anti-immigrant, anti-Muslim rhetoric damaged international ties most prominently during a very public tiff with the Mayor of London. In response to his conduct, the English nation closed ranks against the American President and canceled a state visit he was to have made. Both the Mayor and PM May have strongly condemned Trump’s actions and outlook.
Even casual statements from the President have cost the US political influence. His twitter-based declaration on Jerusalem and rejection of the two-state solution alienated many Middle Eastern allies – whom saw his actions as blatantly appeasing Israel at the expense of peace. Meanwhile, his constant attacks on Mexico and China seem to have alienated the former and emboldened the latter to take on the role of global steward Trump seems incapable of holding onto.
Trump tried to reverse course during Davos, claiming that “America is open for business” and “America First does not mean America alone”. The exact meaning behind his speech and slogan is unclear, as Trump refused to walk back any of the damaging protectionist promises he’d made or reverse any of his recent anti-global actions – giving the statement little practical effect or immediacy. Thus, hisconfused and half-hearted plea for investment and international support came too late to reassure a world already moving on without the US.
During his speech, Trump attempted to upsell his efforts on the American economy, taking credit for strong economic growth and a booming stock market. He said his leadership and the tax cut bill passed in December were responsible for the growth of the American economy. He tried using this to sell himself to the crowd as a valuable trading partner.
However, these boasts were largely exaggerated or misattributed from external causes. The upswing in the American economy was part of a global economic upturn in 2017, and no policy of the Trump administration can be linked to either the global or local trend. Second, the economic growth he is claiming credit for has been a steady progression from through the Obama administration through his. At best, this means he can claim credit for not screwing up the economy or maintaining beneficial Obama era policies. However, he cannot claim to have reversed any trend or imposed his own skill and judgement on the issue.
As far as Trump’s tax cut bills are concerned, the bill was proposed and formulated by the American Heritage Foundation, long before Trump ever entered the political stage. The bill was passed through Vice President Pence, a long-time collaborator with the Foundation, not Trump himself. Moreover, it was passed less than a month ago and they won’t go into effect until the financial year starting this March. The act’s impact on the economy is, at best one of many factors, and it is far too early to determine their effect on the economy.
Meanwhile, China worked to occupy the void left behind by Trump’s isolationist policies. Already enjoying a leadership position in the Trans-Pacific Partnership after the US’s exit, China used the conference to further expand it’s “One Belt, One Road” initiative. A senior Chinese diplomat introduced Pakistan’s Prime Minister Abassi, whom spoke glowingly of China’s increased investment in his country, including the construction of power stations and a new port. In turn, Abassispoke glowingly of China’s increased investment in his country, including the construction of power stations and a new port.
China also began making inroads with South American countries like Brazil and Venezuela. Liu He, from China’s ruling Politiburo, gave the best-attended speech of the conference, discussing the Belt and Road initiative.After the presentation, Brazil’s President Temer welcomed China’s offer to work with Latin American countries to work with the initiative.
The One Belt, One Road initiative may have started out localized to Central Asia, but the vacuum left by the US’s withdrawal from international markets and agreements has emboldened China to expand the program across the Middle East, Europe, South Asia, and Eastern Africa. The program works by extending extending hundreds of billions of dollars of investment in infrastructure – primarily highways, rail, ports, and power stations – from Chinese state banks. By creating a well-developed economic corridor, China gains a strong advantage in exports, while the initiative works to foster a common market.
While the Trump Administration may have seen Davos as an opportunity to counter China’s influence by pulling back from isolationist and protectionist talk, the conference did little to accomplish that goal. Between the half-hearted efforts at reconciliation and Trump’s ongoing protectionist activities, the United States has already ceded much of the global stage to China. What China does with this new position remains to be seen.
By Akash Kashyap