Two weeks ago, we wrote about how President Trump’s foreign policy somehow had ‘folded’ into ‘neo-Americanism’, and quoted US Foreign Affairs Professor, Russell-Mead, suggesting that Trump’s 8 May metamorphosis (the exit from JCPOA), represented something new, a step-change of direction (from his being principally a sharp Art of the Deal negotiator), toward – pace, Russell-Mead – “a neo-American era in world politics – rather than an [Obama-ist] post-American one”. “The administration wants to enlarge American power, rather than adjust to decline (as allegedly, Obama did). For now, at least, the Middle East is the centrepiece of this new assertiveness”, Russell-Mead opined, explaining that this new Trump impulse stems from: [Trump’s] instincts telling him that most Americans are anything but eager for a “post-American” world. Mr. Trump’s supporters don’t want long wars, but neither are they amenable to a stoic acceptance of national decline”.
There is something of a paradox here: Trump and his base deplore the cost and commitment of the huge American defence umbrella, spread across the globe by the globalists (sentiments aggravated by the supposed ingratitude of its beneficiaries) – yet the President wants to “enlarge American power, rather than adjust to decline”. That is, he wants more power, but less empire. How might he square this circle?
Well, a pointer arose almost a year earlier, when on 29 June 2017, the President used a quite unexpected word when speaking at an Energy Department event: Unleashing American Energy. Instead of talking about American energy independence, as might be expected, he heralded instead, a new era of American energy “dominance”.
In a speech “that sought to underscore a break with the policies of Barack Obama”, the FT notes, Mr Trump tied energy to his America First agenda…“The truth is we now have near limitless supplies of energy in our country,” Mr Trump said. “We are really in the driving seat, and you know what: we don’t want to let other countries take away our sovereignty, and tell us what to do, and how to do it. That’s not going to happen. With these incredible resources, my administration will seek not only the American energy independence that we’ve been looking for, for so long – but American energy dominance,” he said.
It seems, as Chris Cook explains, that Gary Cohn, then chief economic adviser to the President had a part in the genesis to this ambition. Cohn (then at Goldman Sachs), together with a colleague from Morgan Stanley, conceived of a plan in 2000 to take control of the global oil trading market through an electronic trading platform, based in New York. In brief, the big banks, attracted huge quantities of ‘managed money’ (from such as hedge funds), to the market, to bet on future prices (without their ever actually taking delivery of crude: trading ‘paper oil’, rather than physical oil). And, at the same time, these banks worked in collusion with the major oil producers (including later, Saudi Arabia) to pre-purchase physical oil in such a way that, by withholding, or releasing physical crude from, or onto the market, the big NY banks were able to ‘influence’ the prices (by creating a shortage, or a glut).
To give some idea of the capacity of these bankers to ‘influence’ price, by mid – 2008, it was estimated that some $260 billion of ‘managed’ (speculative) investment money was in play in energy markets, completely dwarfing the value of the oil actually coming out of the North Sea each month, at maybe $4 to $5 billion, at most. These ‘paper’ oil-option plays would therefore often trump the ‘fundamentals’ of real supply, and real end-user demand.
‘Step one’ for Cohn, was therefore, for the US to manage the trading market, both in price and access – with U.S. antagonists such as Iran or Russia, being able to access the market on inferior terms, if at all. The putative ‘step two’, has been to nurse US shale production, build new American LNG export terminals, and open America to further oil and gas exploration, whilst strong-arming everyone from Germany to South Korea and China, to buy American LNG exports. And ‘thirdly’, with Gulf oil exports already under the US umbrella, there were then, two major Middle East energy producers beyond the boundaries of cartel ‘influence’ (falling more into rival Russia’s strategic energy-producing ‘heartland’): Iran – which is now the subject of regime change–style, economic siege on its oil exports, and Iraq, which is subject of intense (soft) political pressures (such as threatening to sanction Iraq under the Countering America’s Adversaries Through Sanctions Act) to force its adherence to the western sphere.
What would this Trump notion of energy dominance mean in simple language? The US – were energy dominance to succeed – simply would control the tap to the economic development – or its lack thereof – for rivals China, and Asia. And the US could squeeze Russia’s revenues in this way, too. In short, the US could put a tourniquet on China’s and Russia’s economic development plans. Is this why JCPOA was revoked by President Trump?
Here then, is the squaring of that circle (more US power, yet less empire): Trump’s US aims for ‘domination’, not through the globalists’ permanent infrastructure of the US defence umbrella, but through the smart leveraging of the US dollar and financial clearing monopoly, by ring-fencing, and holding tight, US technology, and by dominating the energy market, which in turn represents the on/off valve to economic growth for US rivals. In this way, Trump can ‘bring the troops home’, and yet America keeps its hegemony. Military conflict becomes a last resort.
Senior advisor Peter Navarro said on NPR earlier this week that “we can stop them [the Chinese] from putting our high tech companies out of business” and “buying up our crown jewels of technology … Every time we innovate something new, China comes in and buys it, or steals it.”
Is this then Trump’s plan: By market domination and trade war, to prolong America’s ‘superiority’ of technology, finance and energy – and not somehow be obliged to “adjust to decline”? And by acting in this way, curtail – or at least postpone – the emergence of rivals? Two questions in this context immediately present themselves: Is this formula the adoption of neo-conservatism, by the US Administration, which Trump’s own base so detests? And, secondly, can the approach work?
It is not neo-conservatism, perhaps – but rather a re-working of a theme. The American neo-conservatives largely wanted to take a hammer to the parts of the world they didn’t like; and to replace it with something they did. Trump’s method is more Machiavellian in character.
The roots to both of these currents of thought lie however – more than partly – with Carl Schmitt’s influence on American conservative thinking through his friend, Leo Strauss, at Chicago (whether not, Trump has ever read either man, the ideas still circulate in the US ether). Schmitt held that politics (in contrast to the liberal/ humanist vein) has nothing to do with making the world fairer, or more just – that is the work of moralists and theologians – politics for Schmitt, concerns power and political survival, and nothing more.
Liberals (and globalists), Schmitt suggested, are queasy at using power to crush alternative forces from emerging: their optimistic view of human nature leads them to believe in the possibility of mediation and compromise. The Schmittian optic, however dismissed derisively the liberal view, in favour of an emphasis on the role of power, pure and simple – based on a darker understanding of the true nature of ‘others’ and rivals. This point seems to go to the root of Trump’s thinking: Obama and the ‘liberals’ were ready to trade the ‘crown jewels’ of ‘Our Culture’ (financial, technological and energy expertise) through some multilateral ‘affirmative action’ that would help less developed states (such as rival China up the ladder). Perhaps such thoughts too, lay behind Trump’s withdrawal from the Climate Accord: Why help putative rivals, whist, at same time, imposing voluntary handicaps on one’s own Culture?
It is on this latter, quite narrow pivot (the imperative of keeping American power intact), that neo-cons and Trumpists, come together: And both also share in their disdain for utopian liberals who would fritter away the crown jewels of western Culture – for some or other humanitarian ideal – only to allow America’s determined rivals to rise up and overthrow America and its Culture (in this optic).
The common ground between both currents, is expressed with remarkable candour through Berlusconi’s comment that “we must be aware of the superiority of our [western] civilisation”. Steve Bannon says something very similar, though couched in the merits of preserving (a threatened) western Judeo-Christian culture.
This sense of Cultural advantage that must at all costs be recuperated and preserved perhaps goes some (but not all) way towards accounting for Trump’s ardent support for Israel: Speaking to Israel’s Channel Two, Richard Spencer, a prominent leader of the American Alt-Right (and one component to Trump’s base), highlighted the deeply felt the dispossession of white people, in their own country [the US]:
“… an Israeli citizen, someone who understands your identity, who has a sense of nationhood and peoplehood, and the history and experience of the Jewish people, you should respect someone like me, who has analogous feelings about whites. You could say that I am a white Zionist – in the sense that I care about my people, I want us to have a secure homeland for us and ourselves. – Just as you want a secure homeland in Israel.”
So, can the attempt to leverage and weaponise the American élites’ Culture – through the dollar, and putative energy hegemony, and its hold over technology transfer – succeed in holding on to American ‘Culture’ (in the reductionist construct of Trump’s base)? This is the sixty-four thousand dollar question, as they say. It may just easily provoke an equally powerful reaction; and a lot can happen domestically in the US, between now, and the November, US mid-term, elections, which might either confirm the President in power – or undo him. It is difficult to hold to any analytic horizon beyond that.
But a larger point is whilst Trump feels passionately about American Culture and hegemony; the leaders of the non-West today, feel just as passionately that it is time for ‘the American Century’ to yield place. Just as after WWII, former colonial states wanted independence – so, now, today’s leaders want an end to dollar monopoly, they want an opt-out from the global, US-led order and its so-called ‘international’ institutions; they want to ‘be’ in their own distinctive cultural way – and they want their sovereignties back. This is not just cultural and economic nationalism, it portends a significant inflection point – away from neo-liberal economics, from individualism and raw commercialism – towards a more rounded human experience.
The tide, in the wake of WWII, surely was irreversible then. I can even recall the former European colonialists subsequently bemoaning their forced withdrawal: “They’ll [the former colonies] regret it”, they confidently predicted. (No, they never did.) The tide today runs strongly too, and has spread, even, to Europe. Where – who knows – whether the Europeans will have the spine to push back against Trump’s financial and trade machinations: It will be an important litmus for what comes next.
But what is different now (from then), is that currency hegemony, technological prowess, and energy ‘domination’, are not, at all, assured to western possession. They are no longer theirs. They began their migration, some time ago.