How Trump will change the world
The contours of Donald Trump's second term are gradually emerging. It will change the world more than any event since the end of the Cold War.
Two factors will determine the course of events:
Trump's America First policies
The budget deficit reduction imposed by conservatives
Trump's mercantilist thinking calls for reducing the US trade deficit by erecting tariff walls or by non-tariff discrimination against trading partners.
In order to reduce the budget deficit, savings could relate to
Social benefits (as suggested by Elon Musk)
Defense costs (at the expense of allies)
The newly generated tariff revenues should reduce the budget deficit, make imported goods more expensive and result in corresponding inflationary price increases.
Major exporting countries - Japan, Germany, China, Italy - will continue to try and shift as much production as possible to the USA. This will result in surging investments, which would further stimulate the already strong growth in America.
Conversely, traditional exporting countries will experience a reduction in industrial capacity and resulting unemployment. Overproduction, rising stockpiles and loss of income would affect entire branches of industry.
At the same time, a partial withdrawal of the USA from the common defense would force Allies to significantly increase their defense spending. Both factors taken together - industrial contraction and rising defense costs - could create crises in these countries and lead to internal conflicts that could even threaten the existence of weak countries such as Italy or Greece.
Heinrich von LoeschWeakening Europe
There is a historic design of Trump for Europe. Also supported by Musk. Weaken it, make it more fragile, more vulnerable, less competitive. “I'll tell you something very hard: Europe is no longer a problem for anybody. Unfortunately, it is no longer an industrial competitor because it has almost self-destroyed itself. It is not an economic competitor anymore because even there it has been weakened and relegated to a supporting role in both finance and stock values. It is not a competitor on energy and raw materials because we don't have any and are totally dependent on other nations, primarily China, for all strategic materials and those needed for new technologies, such as rare earths. Europe every year is much less interesting and much less relevant in the world.”
"I don’t stay up at night worrying about Russian influence on Europe. No. 1, their military hasn’t even got to Kyiv. In three years, they couldn’t get there. They haven’t taken Kharkiv even. You know why I don’t stay awake at night? Because the Europeans don’t stay awake at night. They don’t consider Russia a real threat. If they did they would throw a lot more money and troops into the game,” he went on. “If you look at NATO, I don’t think it can put together two combat divisions of Europeans that are ready to fight,” he scoffed, complaining NATO had turned into an American protectorate, rather than being an alliance.