Trump's Presidency: All tactics, no strategy

The Trump administration has demonstrated its ability to seize tactical advantage in the moment, but displays no awareness of strategic disadvantages this creates.

Incoming US President Donald Trump has expressed ambitions to revive Manifest Destiny – US ownership, by force if required, of Canada, Greenland and the Panama Canal. IMAGE: AI Generated by Adobe Firefly

The USA has been the most powerful military and economic force on Earth since the end of the Second World War. But, that power plateaued decades ago and has been actively waning ever since. Donald Trump’s personality and the behaviour of his presidential administrations, then and now, are hastening the fall. And, they don’t see it coming.

“Tactics without Strategy is the noise before defeat.”

– Sun Tzu (771-256 BC)

Manifest Destiny Returns

Donald Trump has spent much of his second pre-presidency transition time, picking fights with his allies. He’s claimed Canada as the 51st US state and said yesterday he will use “economic force” to annex his sovereign neighbour. He’s threatened Greenland with a military invasion and annexation “for national security purposes.” Likewise, he’s said he will use force if required to seize and occupy the Panama Canal from the nation for which it is named.

With Donald Trump’s second and final term just about to begin, he is entirely unbridled now. He interprets (not without some rationale) a Supreme Court ruling that presidents enjoy broad immunity for actions taken in the course of their official duties as carte blanche to do anything, anywhere, any time to anyone as he pleases.

Trump believes he is a masterful negotiator. By that, he means he’s cold-blooded and willing to use any leverage to bend any counterparty to his will. He’s in it for the thrill of the kill, more than the achievement of any goal. Winning is the goal. What comes next is an afterthought.

Witness, his track record in business of forcing smaller vendors, suppliers, clients and partners to accept one-sided terms in Trump’s favour. Then, often reneging on them once the service is provided. A tactical win, for sure. But, many of these same vendors, suppliers, clients and partners refuse to ever do business with the Trump organization again. They found more amenable pastures in which to grow.

As strategy goes, Trump’s negotiating modus operandi leaves much to be desired. His tactics actively sterilize the field of battle, leaving his army unable to forage or improve its position. In business, he eventually ran out of willing and affordable partners. As president since 2016, and again today, he actively converts long-standing allies into adversaries. Tactical wins, perhaps. But an unsustainable strategy.

The USA has far fewer valuable allies than Trump Inc. had potential business associates. Yet, he routinely treats longstanding strategic allies as if they are small businesses he routinely trampled and discarded at will.

By threatening Canada, Mexico, Panama, Denmark and Greenland, Trump is leaning into the leverage that comes with being (for now) the world’s most powerful nation. He’s focused on tactical wins, in the here and now. But, the very power he wields came from America’s alliances, not despite them.

As they are burned by Trump’s belligerence, erstwhile allies have already started looking for alternatives. As they find them, their tolerance of, and dependence upon, the USA will dwindle. As those alliances dwindle, America’s power will weaken, and eventually dissolve. It will happen slowly. But, it is already happening. That’s a bad strategy.

Competitors will respond

Competitors always respond. Trump likely knows that. In business, he didn’t stick around long after winning the deals, he just moved on to the next opportunity. So, he may not have noticed his competitors’ responses. He never hung around long enough to see the chickens come home. As president, he may enjoy similar luxury with only four more years of race track to call his own. But the world remembers him from his first term, even if he may not. And the USA will be around long after Donald Trump; long enough to suffer the strategic failures of this temporary tactical wins.

During Trump’s first presidency, Canada redoubled its work negotiating trading agreements with other nations to slowly reduce its crippling dependency on trade with the USA. Expect that effort to expand tenfold under a new Canadian government, during a more aggressive and less neighbourly Trump administration.

NATO nations are looking for alternative alliances that will keep them safe, without the USA. Which is what Trump wants. He’ll claim it as another tactical victory. He won’t recognize it as a strategic loss. As Europe coalesces around its own security alliances and NATO wanes in significance, the US will lose influence over them.

Without bases in NATO and friendly countries abroad, the ability of the USA to project global power will wane. But, it will not create a vacuum. China is already filling much of the space America used to dominate.

If you’ve travelled outside North America or Western Europe in the last 10 years you will have seen the China emerging as a global superpower. Its economy is now slowing, but Beijing is still willing to invest in “Belt and Road” initiatives to develop critical infrastructure in many nations, with no questions asked. But, China will own the infrastructure and control the assets it funds.

Critical mineral deposits around the world are already owned or controlled by China to a shocking extent. Try building an electric vehicle without buying materials from China.

China has an active Arctic naval program even though China does not border the Arctic.

Whether the US president has been Republican, Democrat or MAGA, the United States is on a downward trajectory in terms of global influence and power. China is one of the countries on the rise. Donald Trump’s tactics will further accelerate the demise of the American Empire. That’s not good for Americans. It’s not good for global democracy.

What can Canada do?

Every smart business owner goes to great lengths to diversify his company’s markets, suppliers and clients, vendors and products. Never too many eggs in too few baskets. Canada’s government should strive to be at least that wise.

Canada is too closely interlinked with our neighbourhood juggernaut to ever expect to be fully independent of the US economy or beyond its military reach. But, we must do what we can to diversify the global markets for goods and services.

USA is Canada’s largest trading partner, account for almost two-thirds (63.4%) of our $1.5 Trillion worldwide total trade in 2023. It would be nice to work that down to 50% over a decade, by growing non-US trade rather than by shrinking US trade.

Although Canada enjoys a trade surplus with the USA, meaning they buy more Canadian goods than Canadians buy US goods, those figures typically exclude services, which are a driving force in the US economy. So, it’s not like the US is doing poorly in our trade relationship. Donald Trump ignores this.

During Trump’s first term, Canada took steps to expand its international markets by inking a number of free trade deals with overseas markets. Since 2016, Canada has concluded a number of free trade agreements: Trans-Pacific Partnership with Australia, Brunei, Chile, Japan, Malaysia, Mexico, New Zealand, Peru, Singapore, Vietnam and UK (not yet in force in UK); Benin; Burkino Faso; Cameroon; European Union; Guinea; Hong Kong; Kosovo; Mongolia; Senegal; and Ukraine. We’ve also renewed and expanded key agreements with the World Trade Organization and its member countries.

This, on top of numerous trade agreements negotiated under previous governments.

In 2016, Canada also renegotiated the North American Free Trade Agreement (which Trump called a “nightmare” and the “worst trade deal ever”) with the USA and Mexico. Trump described the resulting US-Mexico-Canada Trade Agreement as “the fairest, most balanced, and beneficial (to the USA) trade agreement we have ever signed into law” and “the best agreement we’ve ever made.”

That was then. This is now.

We must accelerate the process of developing and expanding trade agreements with more foreign markets.

Build on Existing Alliances. We can start by leaning into non-trade alliances we’re already part of. The Commonwealth and La Francophonie are examples. Together, these represents over 110 nations with whom we already have common cause on many fronts. We should seek to expand the business we do with them. There are also opportunities to be explored with the incipient CANZUK movement that could result in deeper trade, and potentially defence, partnerships with Canada, Australia, New Zealand and the UK.

Develop North-North Opportunities. Our geography constrains us somewhat, making it impractical to ship goods from Canada to Central and South America in a manner that would compete with the much closer USA. But, we should absolutely redouble our efforts to build and expand North-North trade alliances with countries in Europe and Asia. These we can reach by sea as easily as the USA. This effort should except Russia, China and Iran whom we can only consider adversaries under their current regimes.

Source: US Energy Information Administration

Export Value-Added Energy.The next Canadian government must immediately resume and accelerate construction of domestic refineries and pipelines that enable us to ship value-added energy products from Canadian ports to hungry markets worldwide. We should not stop selling energy to the USA, but having our own energy ports will allow us to stop selling energy to the USA at a steep discount. We could, instead, sell to Americans at the much higher global market rate.

Mazimize our Natural Resources. There are markets for Canadian resources, e.g. lumber, agricultural products and critical minerals – and the expertise that grows with them – to markets all over the world. The government should aggressively pursue trade deals with those markets and, if necessary, provide some incentives to Canadian producers to develop them.

Expand Global Service Markets. Canadian knowledge, education, high tech and other intellectual properties, along with advanced and professional services are not typically counted in the balance of trade calculations that garner eyeballs, but are highly profitable and can be sold as easily to New Zealand or Africa as to the USA. We should develop services agreements with as many global economies as possible. There are billions of dollars in economic value waiting to be landed in these sectors.

Canada will always be reliant on good relations with our American neighbours. But we don’t have to be wholly dependent on their good graces. With time and hard work – and a national strategy guiding the way – we can gradually reduce our dependence and build some insulating diversity into our business model.

We also need to give up the free ride we’ve enjoyed for so many years and invest meaningfully in our national defence. But that’s another topic for another column. Suffice to say Russia was stunned at the fortitude of Ukraine. Canada, which trained thousands of Ukrainian Army soldiers and units to withstand a Russian onslaught, should aspire to become just as resilent.

Doing all this (and more) will leave Canada less exposed to bullying from belligerent actors in the USA or anywhere. As more nations seek to conceive and build alliances that work around the USA, rather than rely upon it, the American bully will have less and less leverage and less and less power to abuse its allies.