Allies or Sovereignty? The United States is at a crossroads

Allies or Sovereignty?  The United States is at a crossroads

We live in interesting times, maybe too much. The pandemic emergency, the war in Ukraine, and the escalation of tensions between the United States and China are just some of the elements of the context that make the geopolitical picture of these days so complex.

In this sense, it may be important to provide some explanatory clues to better decipher what will happen in the coming weeks, in the hope that we will move towards a gradual reduction of the very high level of tension that has now been reached at the international level.

The cards at once revealed: the role of the kingmaker, or champion of our destinies, would again be played by the United States of America; Indeed, in recent years, the White House’s ability to coherence has traded off (at least in part) divisive measures, which have contributed to spurring morale in different regions of the planet.

The undoubted, and in some ways, unpredictable success of Biden can be attributed to his ability to keep a large group of allies united (attributed to the so-called Western sphere of democracies) against an arrogant Putin’s invasion (attempt) of Ukraine.

Such success was achieved only twice in the past: the defeat of Saddam Hussein in the Gulf War in 1990 and the defeat of ISIS in 2014. On the other hand, there is no doubt that the recent decision to send tanks to Kyiv is clear evidence that NATO, which was considered weak before Just a year old, he’s now lonelier and more resolute than we’ve seen him before.

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On the contrary, we have witnessed actions/decisions strongly directed towards the sovereign national orientation. In the first place, I intend, paradoxically, to point to the Indo-Pacific Economic Framework clause, which should unite 13 countries in the region with the United States (and against China) but which in fact falls short of the objective as the White House has not decided to break down tariff barriers. That remains for companies from these countries that wish to export to the United States.

Even more divisive is the passage of (1) the Reducing Inflation Act – which allocates more than $400 billion to US companies provided they commit to going green -, (2) the Chip Act – which commits $50 billion to support the domestic semiconductor industry – and (3) the restrictive measures against technology trade with China; These are moves that testify to how the United States is taking a bipartisan “America First” approach to the global economy, highlighting the reversal of globalization. It is also in this key that we can interpret the image that represents nothing but unanimity within the assemblies of the nations when it comes to confronting the tsar of St. Petersburg; The rift is currently between Western democracies and the rest of the world, but if we look closely, Western cohesion itself could fail.

The fuse to any geopolitical rift will be, as it often happens, wholly internal to the United States and will relate to the confrontation/clash between the Republicans and the Democrats; If an isolationist and self-projected vision of America prevails, then detachment (economic and technological) from China will become more pronounced; At that point, many European and Asian countries – to understand Japan, Indonesia, Vietnam and Thailand – could get into trouble with regard to the American position as pressure from the respective national corporations – intent on keeping their (huge) profits in China – could only prove to be contained. With a (partial) change in attitude towards the White House.

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Therefore, the world now more than ever needs America in dialogue, which certainly protects, God forbid, its own interests, but not according to the perspective of “America First.” After all, the period in which the world has grown the most from an economic, social, and technological standpoint is the period in which the United States has positioned itself as the leader of an open world.

So hopefully the call of history will have the upper hand in this (very loud) contemporary politics; The first occasion is to amend the law on reducing inflation, which is objectively a competitive asymmetry that the EU is hard to bear. As Rachman wrote in the Financial Times columns this week, “the unity among Democratic allies achieved in 2022 is a precious asset,” which must not be lost in 2023.

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