The following is a chapter from Trumpism and its Discontents. Click to download a PDF of the book here.
By Neil Fligestein
President Trump has been making astonishing foreign policy claims since beginning his term in office. He has followed up these claims by seeming to embrace dictators and offend longtime allies. He has gone quite far in calling those allies “enemies.” His embrace of Russian president Vladimir Putin has been one of the key inexplicable puzzles of Trump’s administration. At the same time, Trump has repeatedly attacked his North Atlantic Treaty Organization (NATO) allies. He has managed to offend the Australian, German, Canadian, and French prime ministers, who have historically been among the United States’ staunchest allies. He has attacked both Mexico and Canada repeatedly. The president went full bore to end the North American Free Trade Agreement (NAFTA). He has repeatedly referred to Mexicans as “bad guys” and “rapists” and promised to have Mexico pay for a thirty-foot-high border wall between the United States and Mexico to keep them out. His performances at international gatherings and his assertion of “America First” have led to his isolation at such events.
The way that the liberal press has portrayed all of this behavior is to intimate that Trump is somehow “crazy.” They view his rants as evidence that he is ill-tempered and misinformed and is acting like a bull in a china shop. But I argue that he has actually adopted a very coherent set of positions, positions that are tailored to appeal to the base constituency that elected him US president. My argument has three parts. First, I present a stylized view of “Trumpism,” by which I mean Trump’s foreign policy positions. I discuss who Trumpism is for, who it is against, and what Trump’s analysis is.
In the second part, I try to understand why Trump is taking these positions. I consider the structure of the existing world order. All of the important institutions and organizations that make up the world order are in fact American in their origin. That order was essentially constructed by the United States after World War II, and it was established to reflect this nation’s political, military, and economic interests. These institutions were remarkably successful between 1945 and about 1980.
But since the deep economic crisis of the 1970s, those institutions have failed to deliver returns for most Americans. The political solution to that crisis involved deregulating the economy, undermining the power of organized labor, and cutting taxes for the well-off and corporations. None of these actions helped workers or the middle class. All set the stage for increasing income inequality and, more importantly, a decline in economic opportunities for working-class Americans who had less than a college education. The shareholder value revolution in corporate control changed the way that corporations operated. Managers came to shift tactics to engage in actions to raise share prices and benefit shareholders. These tactics included downsizing and outsourcing, with the general result being the hollowing out of the American manufacturing base. Global supply chains evolved to take advantage of lower wages paid to workers in other countries. This action reinforced the impact of the policy changes on the opportunities of working-class Americans and meant that blue-collar jobs began to disappear. American wages stagnated, and with the increased income going to top management and shareholders, there was an increase in the concentration of their income and wealth.
The international institutions that emphasized free trade persisted and expanded. But now, instead of trade causing an increase in wealth for all in the United States, this trade expansion has produced a long-running crisis for many Americans and windfall gains for those at the top. Trumpism is a direct response to this crisis. Trump’s critique of the liberal world order articulates beliefs that for many Americans ring true.
The third issue I discuss concerns the kind of pushaback Trump has gotten on this agenda. These constituencies have many very powerful actors who support them, including the US military, the largest US corporations, the right-wing foreign policy community, and potentially, American farmers (who Trump has carefully worked to buy off). But Trump has been persistent in pushing his agenda, and certainly the tone of what is going on in the organized world order has already changed. If Trump gets the world he wants, what will it look like, and what will happen to the existing institutions? What will happen to the UN, NATO, WTO, World Bank, IMF, and NAFTA?
What we have actually been seeing is that Trump has engaged in a symbolic politics in which he uses inflammatory language to demean immigrants, threaten allies, and embrace former enemies. Its strongest impact has been to legitimate and encourage those who were previously viewed as pariahs by US foreign policy, dictators such as Kim Jung Un (North Korea), Vladimir Putin (Russia), Recep Erdogan (Turkey), and Abdel Fatteh el-Sisi (Egypt). These leaders have embraced Trump’s talk of “fake news”, nationalism, and populism, in order to secure their positions.
But Trump’s ability to attain his agenda has frequently had to confront organized forces in the U.S. who support the existing institutions, Trump has walked back many of his positions. His redone NAFTA treaty, for example, has changed little of the overall structure of relations among Mexico, Canada, and the United States. Nonetheless, Trump has declared his renegotiation of that treaty a victory. This does not mean that he has not undermined the American created international order. After all, he is the president of the United States and can issue executive orders to control American participation in international affairs. However, while many of these institutions are in crisis because of Trumpism, there are still plenty of very powerful actors, including corporate America, the military, and sometimes Congress, telling Trump, “You cannot do this.”
What Is Trumpism?
The parts of Trumpism that are relevant to international affairs begin with a critique of political and economic globalization and the political and economic elites who have benefited from globalization. That critique is aimed at his core constituents, who believe that these elites have prospered while they have been left behind. Trump has four ideas here, all of which blame political and economic elites for favoring policies that benefit the elites materially or, even worse, benefit other countries and thereby hurt most Americans. The first is anti-immigration. Trump has been arguing that elites have opened doors to legal immigrants for political reasons and turned a blind eye towards illegal immigration. He maintains that they have let both legal and illegal immigrants come into the United States and take jobs from Americans and that in doing so, they have depressed wages for Americans. Trump’s policy initiative is to build a wall at the United States–Mexican border and to throw illegal immigrants out of the country, even sometimes suggesting he would also like to remove legal immigrants.
The second big idea Trump espouses is opposing free trade. Trump has continuously argued that all of the trade pacts into which the United States has entered have been bad for America. He maintains that these treaties have been tilted in favor of other countries, which then get access to our markets without letting us into theirs. He also feels that the pacts work to produce unfair competition by letting US corporations locate jobs in countries with few labor or environmental standards.
The first thing Trump did when he came into office was to get rid of the Trans-Pacific Partnership (TPP), a trade agreement that involved most of the countries of the Pacific Rim. He subsequently railed against NAFTA and pushed for a renegotiation. He is not a big fan of the World Trade Organization (WTO). In fact, he’s not a big fan of any of the existing trade agreements, including ones to which the United States does not belong, like the European Union (EU). Again, Trump’s objection is that these trade pacts benefit political and economic elites and are unfair to American workers. In the case of the EU, he views that organization as diminishing national sovereignty.
The third idea in Trumpism is a critique of corporations. The main US economic elites that have been complicit in creating this world of open borders and open immigration are the large corporations that take advantage of this openness to locate production and jobs outside the United States. Trump has been directly saying to the chief executive officers (CEOs) of these corporations, “You have to bring those jobs back here.” During the first few months after Trump took power, he took several CEOs to task and got several others to engage in publicity stunts whereby they appeared to be keeping jobs in the United States. Subsequently, most business leaders have tried to stay off his radar screen.
Finally, Trump sees one outcome of these political and economic projects to be economic growth in other countries at the expense of US jobs and workers. This critique focuses less on gains made by political and economic elites at the average American’s expense and more on what other countries are getting. This kind of critique is mostly about trade agreements in which Trump views the United States as the loser, such as in its relations with China. In this analysis, China gets rich by taking American jobs and technology, and we get nothing in return but a trade deficit. In the case of NATO, his attack is couched in the idea that European countries should pay more for their defense. Here, the Western Europeans have gotten a free ride by having the United States provide their defense. He repeatedly argues that European countries should pay the United States directly for the protection they receive under the NATO umbrella.
Trumpism’s main ideas form an ideology. An ideology is a coherent set of ideas that give us policies to change the world and make it work in a different way. Trumpism identifies who the enemies are (immigrants, elites, corporations, other governments) and specifies the victims (native-born white Americans). It offers proscriptions for actions like engaging in trade wars; pulling out of treaties; stopping support for international organizations; and demanding renegotiation of existing political, military, and economic arrangements, particularly those that seem to benefit other countries at the expense of the United States. It creates a symbolic politics that is very powerful and appeals to his core voters, who share his critique.
The Rise and Fall of the American Liberal World Order
It is important to locate Trumpism in the actual development of postwar international military, political, and economic arrangements and to identify whom they benefited and why. By the end of World War II, most of Europe and Japan had been destroyed. The American government decided that it was going to construct some international architecture and programs to encourage democracy and capitalism in these countries. The goal was to restore the economies and economic growth in these countries but to do it in a way congenial to American notions of what was right.
What happened was that a whole series of institutions and organizations came into existence to promote this project. Equally as important as stimulating other countries’ economies was making sure that communism would not spread, and that capitalism would thrive. The Soviet Union very quickly became the main enemy when the Cold War started.
It is useful to examine how these institutions and organizations created a system whereby the United States acted as enforcer, peacemaker, and provider of rules to govern and expand trade. The United States retained military bases around the world. The American government established these bases in Europe, Asia, and the Middle East. Having these bases provided a kind of hard power that could be used if necessary. The North Atlantic Treaty Organization (NATO), the most important military alliance, was created at the beginning of the Cold War. It was a pact between the countries of Western Europe and the United States to defend Western Europe against attacks from the Soviet Union. The idea of NATO was that if any one of the member countries was attacked, the Americans would come in to help. This agreement was a really important part of creating stability in Europe. Throughout the Cold War, NATO proved to be an effective deterrent to Soviet Union aggression. The Soviets never decided to test NATO’s alliance in Europe through invasion.
The US government worked to jump-start both the European and the Japanese economies. The Marshall Plan (1948) provided funds to nations so that they could rebuild their infrastructures. The US government also engaged in state-building after World War II in many countries, particularly in Germany and Japan. In both countries, they tried to dissolve the prewar corporate order and replace it with one that more closely resembled the US economy. The U.S. government was very interested in trying to create liberal democracy. The American government did this both overtly and covertly around Europe and in the rest of the world. The U.S. supported politicians they liked, and, of course, the American government would try to keep politicians they did not like from getting elected.
The United States also worked to found the United Nations (UN). After World War I, President Woodrow Wilson had proposed creating the League of Nations, an international organization that would meet to discuss world issues. However, the American Senate voted to prevent the United States from participating in that proposed organization, and it never materialized. After World War II, one of the main ideas was to create such a political forum to try to bring countries together routinely to talk.
The United Nations, the international forum consequently established in 1945, does two things. One is that it provides a talk shop from which there is the possibility of collectively deploying UN peacekeepers made up of soldiers from the armies of different countries for humanitarian intervention in sectarian battles around the world. What the establishment of the UN did was to allow governments to come together; to bring troops in; and, when situations really became horrible in some places, to bring in peacekeepers to attempt to solve problems. The UN has been more or less successful in that endeavor during the postwar era.
The second function of the UN is to convene the Security Council, which is composed of the five large, great powers in the world (the United States, the United Kingdom, Russia, China, and France) and ten rotating members. This council also provides a more focused forum for discussion about world conflicts. However, sometimes the members of the Security Council agree, and sometimes they do not. In addition, the United Nations has never acted as a constraint on US power. If the United States cannot convince other countries to enlist in a security project that it favors, it can fall back on its military and go it alone.
One can argue about the degree to which the UN has actually achieved any of these goals in the postwar era. However, the existence of the UN has meant that there has been a forum where issues can be aired and discussed before war becomes the final outcome. Obviously, getting the support of other countries makes legitimating intervention easier. The United States still finds this option useful as it can always decide to instead pursue its foreign policy goals without that support. For example, in 2015, the UN Security Council helped broker a deal to get Iran to give up its nuclear weapons program. In 2018, Trump tore that agreement up, removing the United States’ participation, the kind of thing American presidents have done on occasion in the postwar era. He tried to force all of the United States’ allies to go along with his desire to punish the Iranians more directly by cutting off the Iranians’ access to the world banking system and by preventing Iran from exporting oil.
The economic institutions that were put into place after World War II were invaluable for forging the postwar recovery in the developed world and, to a lesser degree, in the developing world. There were a large number of problems coming out of World War II that were on the agenda of matters to address. The first was to restore world trade. Before World War I, world trade was something like 15 percent of the gross domestic product (GDP) in the world. By the end of World War II, world trade was approximately 4 percent. World trade had been decimated by the policies that governments had pursued during the Great Depression and, of course, World War II.
The idea of creating more trade was that if a nation stimulated trade, that effort would jump-start economic activity. At the core of this matter was the problem of establishing what currency would guide trading. In the nineteenth century and into the twentieth, there was something called the gold standard, which meant that people used gold as a way to pay for goods that were purchased from other countries. If I bought something from you, the amount I had to pay you in your currency was determined by the exchange rate of your currency for gold. This situation created massive problems for trade since the price of gold routinely rose and fell, and the supply of gold was not determined by the level of world economic activity but rather by the cost of finding and mining gold.
At the end of World War II, U.S. gathered together representatives of many of the world’s largest economies in 1944 in Bretton Woods, New Hampshire to try and build a postwar financial architecture for the world. One important proposal on the table was the idea the United States had to create a single world currency, a kind of currency that would be a market basket of a lot of currencies. The reason for this action was that a single currency would not be as open to the kind of fluctuations in prices for any given country that would result if each country used only its own currency for trade. Most of the countries that would have participated in that trade at that time were not ready to adopt a single currency as doing so seemed to imply too much pooling of national sovereignty for them.
Instead, what emerged was the Bretton Woods Agreement.
The second idea that the United States supported was the creation of the World Bank. After World War II, most of the infrastructures of countries in Europe had been destroyed. If a nation is going to have economic growth, it needs to have roads, electricity, water, and sewage systems. What nations did was to create an organization that was collectively owned by different countries that helped loan money to a country to rebuild its infrastructure. In the beginning, many of these loans were made to European nations, but later they went to the developing world. This effort promoted economic growth. Citizens were hired to undertake construction projects, an arrangement that offered an immediate economic stimulus. Once a country’s infrastructure had been restored, its people could use it to engage in economic activities.
The third institution that the United States established was the International Monetary Fund (IMF). One of the big problems in the world before World War II was that governments were constantly having fiscal crises. They would run large budget deficits, but they were not able to tax enough or borrow enough to cover those deficits. Governments would rise and fall on their abilities to pay for their activities. Therefore, the decision was made to create a bank that would come in at the last instance when things became really difficult and loan money to governments to keep them stable.
In 1948, a treaty called the General Agreement on Tariffs and Trade (GATT) was negotiated. The GATT was a way to lower tariffs around the world so that there would be more movement of capital and goods. The treaty was expanded in 1995 to create the World Trade Organization (WTO), which sets rules for trade around the world. The GATT and the WTO have successfully led campaigns to lower tariffs and provide the conditions for rules of trade around the world.
If you are considering what the US government wanted in its foreign policy after World War II, the main goals were to create a stable world where capitalism flourished and where regimes were enduring. The UN provided a place to discuss potential national conflicts and legitimate intervention if necessary. The military deployments created the ability to respond quickly in the event that conflict broke out. During the Cold War, the US government also did not want other countries to ally with the Soviet Union. This desire meant that the United States was prepared to prevent countries becoming communist by supporting authoritarian regimes and using military force to intervene in conflicts.
But promoting economic growth to produce stability was key to the future of the US liberal world order. The US government pushed for economic growth by promoting capitalism and free trade as policies that would give citizens in many countries more freedom from economic need. These institutions gave the United States a set of levers to push to advance its vision of the world order. When people critique these institutions, they do not quite appreciate how they all have worked together to produce a world that has in many ways come to resemble the American policy preferences.
One important organization that is not controlled by the United States is the European Union (EU). It was founded in 1957 under the document called the Treaty of Rome. The European Union established a custom union across six countries, a development that meant one could move goods and services around from country to country without having to pay any customs or duties. That organization proved to be so successful that eventually twenty-eight countries joined it (although Great Britain has recently left the European Union). The EU subsequently has gone on to foster more cooperation among its members that includes the completion of the single market and establishment of a single currency.
The European Union is the most open trade zone in the world. It was built on the philosophy that if people are trading, they are less likely to go to war with each other. Trading makes nations interdependent, and this relationship gets them to view things more as win–win rather than win–lose. In Europe, the EU worked spectacularly well until the financial crisis of 2008. The creation of the EU was done with the blessing of the US government. Although this country did not create it, from the United States’ point of view, the EU created part of a liberal world order consistent with the US vision.
The US liberal world order worked wonderfully. It established a democratic Europe and Japan and created wealthy societies in both places. In 1991, the Soviet Union collapsed, and the people who promoted the American model could rightly claim victory. One author, Frances Fukuyama, declared the end of history.
But this liberal world order stopped working to benefit average citizens of the United States. Indeed, I would date the beginning of that decline as 1973, which was the first year of the tripling of world oil prices. Although the liberal world order chugged along until the collapse of the Soviet Union in 1991, it was already creating problems in the core of the core: the US economy. The principal beneficiary of this new world order in the United States from 1945 until 1973 was the emerging American middle class. Those who worked in blue-collar occupations and worked in factories benefited dramatically. These agreements opened up world markets, and American corporations went everywhere to sell American-made goods. Part of that success was tied to the destruction of much of the economic base in the rest of the world during World War II. But US goods were also technologically sophisticated and well made. Paul Baran and Paul Sweezy ended up calling the American workers the “labor aristocracy” of the world because of their relatively privileged position as high wage earners.
But then things began to fall apart. The reasons why they did are complicated, but basically the 1970s brought about a long period of a stagnant US economy with high inflation. Wage growth stopped during this period, and by the late 1970s, income inequality had begun to rise in the United States. This combination of slow economic growth and high inflation affected US corporations by lowering their profits and producing low stock prices throughout the 1970s. The political and economic solutions to this crisis in the United States favored the well-off over the middle and working classes. The international institutions continued to expand free trade (NAFTA was signed in 1993, and the WTO formed in 1995), but the principal beneficiaries in the U.S. were the wealthy. Free trade stopped looking like a good deal for middle-class Americans and started to look like one of the main ways in which their job opportunities were being undermined.
In 1980, Ronald Reagan, a conservative Republican, started to put into place policies that favored corporations through deregulation and that worked against the organization of workers. Unions came under attack, and by the late 1980s, their membership had fallen to levels well below those of the early twentieth century. Reagan also cut taxes for the wealthy and corporations. All of these measures worked to decrease opportunities for working-class Americans and increased income inequality.
The economic crisis in the United States was addressed by the rise of the shareholder value social movement. Managers were blamed for the poor performance of corporations based in the United States. They were replaced by new managers who would privilege shareholders over stakeholders. In practice, this shift started with a large merger movement that broke firms up and sold them off in pieces. Plants were closed, and workers and managers were laid off. Union workers in particular were targeted. Investments were made in technology to further diminish the power of workers.
The only things that mattered were the share price and corporate profits.
All of these changes to the US economy have favored shareholders over stakeholders (workers, communities, and employees). Top managers received stock ownership to incentivize them to raise a company’s share price, thereby increasing inequality as well. On every front, political and economic, the rise of the 1 percent and the increasing wealth and income inequality were the result.
Since the turn of the twenty-first century, the relative advantages of the 1 percent and those who own stock more generally have been reinforced by a couple of trends. First, firms have continued to use technology to reduce their need for labor. Second, beginning in 2001, when China joined the WTO, US manufacturing firms have continued to lose jobs to China. It has been estimated that most of the job loss was concentrated in the Upper Midwest and totaled between two and four million jobs.
These changes explain the appeal of Trumpism. By blaming immigrants, elites, corporations, and free trade, Trump has put his finger on the ways that working and middle-class white Americans understand how their privilege has eroded. That he has attacked the world order that had been created by America after World War II makes perfect sense. The arrangements that had brought peace and prosperity to Americans in the past now increasingly appear to work for corporations and economic elites and for immigrants who take American jobs. But they do not appear to help average citizens.
Around the world, we observe similar debates. There are somewhat different causes for the economic problems in Europe and the United Kingdom, but those problems have been met with similar rhetoric. Anti-immigrant sentiment runs high across Europe. Politicians with populist agendas appear to be on the rise in many places. But this rise in populism is very much related to the exposure of citizens to the downsides of free trade. European welfare states remain strong and generous in many places. Right-wing parties have emerged, but so far, they have not taken power in any country in Western Europe. In France, Marine Le Pen, a populist politician, got 21.3 percent of the vote in 2017. In Germany, the Alternative for Deutschland, a populist party got 12.60 percent of the vote in 2017. If you go to Scandinavia, populist parties routinely get between 10 and 20 percent of the votes. The appeal of these politicians has been felt more in Poland and Hungary, where nationalism is running high even though migration has not been significant. What Has Happened? Trumpism is essentially an American reaction to the fact that the existing world order that had once benefited the United States’ workers and middle class has stopped doing so. The liberal world order continues to provide the conditions for free trade and economic and military stability and to work well for corporations and the upper middle class. But within the United States, the gains from that stability have disproportionately gone to the top 20 percent of the income distribution and mostly to the top 1 percent.
When Trump came into office, he took the United States out of the Trans-Pacific Partnership (TPP) as one of his first acts. Then he began to call out business executives in order to convince them to keep jobs in the United States. Soon thereafter, he told Mexico and Canada he wanted to renegotiate NAFTA to better advantage the United States. He also began criticizing immigrants from various countries. He has been working on funding a “wall” on the United States–Mexican border. He then proceeded to declare a trade war on China. He blamed China for engaging in unfair trade practices that cost American jobs and created a large trade deficit. All of these acts are consistent with an analysis that regards the current world order as not benefiting American citizens enough.
Trump’s actions have impacted international institutions and work to undermine those institutions. The WTO, for example, has ground to a halt because of Trump’s refusal to approve new members for it dispute governing board. His withdrawal of the United States from the TPP and his declaring a trade war on China have already altered the world trading system. However, there are many groups in the United States that do benefit from the existing world order. So, for example, Trump’s much ballyhooed attempt to revise NAFTA created a new trade agreement that is known as the United States, Mexico, and Canada Agreement (USMCA). Most observers see little change in the new agreement which went into effect in 2020, with marginal increases in automobile content for US producers and small changes to Canadian milk tariffs.
Trump’s efforts have been contested at every turn. If he has not been able to use executive power to do something, the roadblock has usually caused him to change the subject. His courtship of Putin also appears to have receded as evidence has mounted that Putin tried to interfere in the 2016 US presidential election and Putin’s annexation of Crimea produced international outrage. However, these developments do not mean that Trump will not continue to push his agenda. From December 22, 2018-January 25, 2019, Trump shut down the government to force the issue of the funding of his “wall” on the Mexican-U.S. border. When he did not get the appropriations he asked for, he declared a national emergency and moved Pentagon funds to continue work on the “wall.” In 2018, Trump began a trade war with China by placing tariffs on Chinese imports. The conflict lasted until 2020 when a deal was signed to remove the tariffs with the promise of China agreeing to buy more American agricultural products. Most observers view the deal as giving Trump cover to declare victory even though he did not attain most of his goals. It is also seen as a victory for
China which withheld making real changes to the way they do business.
One area where you can see that Trump has really backed off is in his criticism of corporations. During Fall 2017, the Republican Congress lowered corporate taxes substantially. Instead of vowing to levy taxes on corporations that are importing goods instead of producing them in the United States, Trump signed a bill giving corporations the largest tax cut in postwar history. They have used this tax cut to reward shareholders by buying back stocks. Shareholder value capitalism is still alive, well, and flourishing.
Now, this outcome does not mean that Trump will stop trying to use Trumpism as a wedge issue to appeal to voters. He will undertake both symbolic and real acts to convince his core supporters that he is working in their interest. When it suits his interests, he will continue to criticize individual corporations. The crisis of the middle class, particularly whites without a college degree, is still out there, and Trump will continue to use Trumpism to speak to the real issues important to his main constituency. But the Republican Party and the large corporations both have interests embedded in the existing economic order. I expect Trump to continue to push his anti-immigrant, anti-international agreements, and anti-free trade agenda. But, he will be met by some resistance from corporations that have a stake in the existing trading system. So, although the US liberal world order now only benefits the few, these entities are organized and remain powerful and vigilant in their efforts to protect their interests. His best moves will be to declare symbolic victories when his agenda is thwarted by other organized interests. His real victories will be confined to the parts of his agenda that do not threaten the privilege of powerful economic actors like corporations.
An earlier version of this essay was originally presented as a lecture at the UC Berkeley Sociology “Workshop on Trump”, April 24, 2017.