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Donald Trump was always going to throw his weight around with U.S. allies. The incoming president was expected to threaten not to defend friendly countries from Russia or China unless they increased military spending, and to impose tariffs on their exports if they did not buy more American goods.
” and supporting the Alternative for Germany (AfD), which opposes European unity and military aid." to Ukraine.
Even if the threats do not go beyond rhetoric, this bullying of allies will weaken the West in three ways. First, Trump’s intimidation of Greenland and Canada – both fellow members of NATO - will create distrust within the alliance that has been the bedrock of Western security since World War Two.
Second, Trump’s threats of military force – even if he doesn’t mean them seriously - undermine the case against Russia’s invasion of Ukraine. The U.S. and its allies have argued forcefully that big powers do not have the right to grab chunks of their neighbour’s land. Now that the former reality TV host is threatening to do the same, he lacks any principle to argue against Putin’s empire-building or, for that matter, a possible Chinese invasion of Taiwan.
Third, Musk’s interventions may have helped the AfD, which is gaining ground in opinion polls ahead of next month’s German general election. It would not be surprising if France, where the political situation is unstable, also catches the multi-billionaire’s attention.
Musk draws his power not just from his wealth and control of the social media platform X, but also from his influence over Trump and his role in the incoming administration as co-chair of a task force to slash government spending. If Tesla (TSLA.O) boss is able to shift the political needle towards the far-right in any large European country, the continent would become more divided just when it needs to come together to beef up its defences and improve competitiveness.
TRUMP’S AGENDA
To be clear, Canada is not about to become the 51st state. It’s also unlikely that Trump will invade either Panama or Greenland. But quite apart from his destabilising message that effectively might be right, allies cannot just laugh off the threats. The incoming U.S. president is probably flexing his muscles because he wants to renegotiate the country’s relationship with key neighbours.
Trump has three big asks from Canada: higher defence spending, which at 1.4% of economic output is below NATO’s 2% target; tighter border controls to prevent drug trafficking; and an end to the country’s trade surplus with the United States, which reached $8.2 billion in November. Following Prime Minister Justin Trudeau’s resignation last week, Trump is well placed to achieve at least his first two goals. The Conservative opposition leader Pierre Poilievre, who is the favourite to win an election later this year, has promised more military spending and to secure the border.
While Trump may aspire to control the Panama Canal, he might settle for less, says Jay Truesdale, chief executive of TDI, the U.S.-based strategic advisory firm. Objectives could include a change in the status of Hong Kong-based CK Hutchison (0001.HK), which manages ports at the waterway’s Caribbean and Pacific entrances, to avoid any risk that China could influence how it operates; and a reduction in the fees that U.S. ships pay for transit.
Similarly, Trump might accept an expansion of U.S. military bases in Greenland and greater access to the territory’s natural resources, including rare earths, as an alternative to annexation. Denmark, which has sovereignty over the world’s largest island, has made clear it would welcome a stronger U.S. presence because of increased Russian and Chinese activity in the Arctic.
What is more, if the 57,000 inhabitants of Greenland vote for independence, as they have a right to, Trump may be able to use a mixture of carrots and sticks to achieve at least these more limited objectives. While that would not give him the glory of adding a huge chunk of real estate to the United States, it would have strategic benefits.
MUSK’S AGENDA
Meanwhile, Musk’s desire to change Europe’s political map appears genuine. The tech maestro also has lots of commercial interests – from space exploration to Tesla electric vehicles and social media. He may be able to use his political influence to promote his businesses – whether to secure contracts or favourable regulation - and then deploy his economic clout to enhance his power.
Musk may also be playing a long game. He is only 53, while Trump is 78. He could loom large in global politics and business for decades. Of course, the entrepreneur’s clout would be much diminished if Trump fell out with him. But although the president-elect has ousted aides in the past, Musk is the opposite of a hired hand. What is more, Trump has so far given him the thumbs-up, only last week calling him “very smart”.
Both Trump and Musk appear to be relishing their new-found power. They can make huge waves by riding roughshod over international norms and diplomatic niceties. They are also finding it is easier to bully America’s friends than face down its traditional rivals.
This will damage U.S. power in the long run. Its network of alliances and support of the rule of law have been a source of strength.
America’s allies will presumably go into overdrive to persuade Trump of the danger of beating up on his friends. They can say the United States’ main threat remains China and that letting Russia win in Ukraine would be a blow to American power and prestige. Maybe the incoming commander-in-chief will listen. But for now, both Beijing and Moscow should be delighted with how his presidency is shaping up.
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Editing by Peter Thal Larsen and Streisand Neto