Repost from Predictive History: The Trump New Deal
REPOST SOURCE: https://substack.com/home/post/p-195415153
The George HW Bush has arrived in the Middle East, and Centcom has in position three of the United States’ eleven aircraft carrier strike groups. Despite the ceasefire, America’s airbridge to the Middle East continues, and America has now assembled more firepower than it had before the war commenced on February 28th. China has warned its citizens to leave Iran immediately, and the last time that China issued such a warning was on February 27th. Eighteen nations have told its citizens to leave, including the United States, Germany, France, and the United Kingdom.
Perhaps peace is possible. Trump has extended the ceasefire, and has sent his envoys Jared Kushner and Steve Witkoff to Islamabad, where they might hopefully run into Iran’s Foreign Minister Abbas Araghchi, who will also be visiting.
Unfortunately, Trump and the Israelis have consistently used negotiations as a cover for a sneak attack, and there are three subtle signs that this war will become both protracted and global.
The United Arab Emirates has asked for a currency swap line, and the United States Treasury Secretary Scott Bessent has told a Senate hearing that this would benefit both the UAE as well as the United States. The UAE currently has $120 billion in US treasuries, and a loan means that the UAE would not have to divest. This begs the question: The UAE is suffering the most from this war, and so why not sell US treasuries to put pressure on Trump to end this war?
From a game theory perspective, the UAE cannot afford for the United States to walk away. Dubai’s miracle was in conjuring up a mirage of a millionaire’s paradise. Since 2014, Dubai’s millionaire population has doubled to 81,000. The twenty billionaires and 237 centimillionaires who moved their wealth to Dubai are now moving it out. Only a humbled Iran can make Dubai great again. As well, a United States defeat would mean Iran could force UAE to pay reparations with a Strait of Hormuz toll.
By borrowing money from the United States, the UAE aims to incentivize the Americans to continue the fight:
One major reason that the United States entered World War I is that it could not afford for the Allies to lose. By 1917, American investors had bought $2.3 billion in war bonds from the Allies, and $40 million from the Germans. By borrowing heavily from the United States, the UAE hopes to become “too big to fail.”
Borrowing from the United States is a way for the UAE to finance this war against Iran without incurring the wrath of the Muslim world. Trump has said that he wants the GCC to pay for the war, and he cites as precedent the 1990 Persian Gulf War when Kuwait, Saudia Arabia, the UAE, Germany and Japan covered 88 percent of the war cost ($54 billion in total).
We can expect this war to cost trillions, and by creating the template the UAE hopes to build a “coalition of the willing” to finance this war. We can assume that Saudi Arabia, which wants the Unites States to humble Iran, is working behind the scenes to ensure the UAE gets American financing to withstand this war. Bessent wants to extend currency swap lines to all the economies that are suffering the most from this war, primarily those of the GCC and East Asia.
The second subtle sign that this war will be protracted and global is that the Indonesian Finance Minister Purbaya Yudhi Sadewa, speaking at a symposium, made an off-hand suggestion to impose tolls for using the Strait of Malacca: “If we split it three ways between Indonesia, Malaysia, and Singapore, that could be quite something, right?” He had to walk this back after the immediate backlash.
Eighty percent of China’s imported crude oil traverses the Strait of Malacca, and it’s so crucial to China’s global trade that President Hu Jintao coined the phrase “Malacca Dilemma” to describe this strategic vulnerability.
It is hard to imagine that an Indonesia high official, always sensitive of the US-China rivalry, could be so careless in a public setting. Was he testing the waters on behalf of the Americans?
On April 13th, US Secretary of War Peter Hegseth hosted the Indonesian Defense Minister in Washington, and an agreement was signed to permit the US to use Indonesian airspace. Three days later, the United States and Morocco (which along with Spain and Great Britain controls the Strait of Gibraltar, another strategic maritime chokepoint) agreed to further defense co-operation. Trump has threatened to reclaim the Panama Canal, which he says is controlled by China.
The third subtle sign is US Senator Lindsey Graham’s tweet that Trump’s naval blockade of the Iranians “could become global soon.” This implies that the United States navy could board and seize any ship anywhere in the oceans.
These three signs suggest that America is desperate to maintain its empire, and make the world pay to make America great again.
Trump’s central belief is that the world has taken advantage of America, and it’s time for a new deal. America used to be a manufacturing power and a net exporter, and now it is a financial power and a net importer. This is a direct consequence of the “Nixon shock” in 1971 when Nixon de-pegged the USD from gold. The US could print money without limit, and the American economy had to absorb all this excess liquidity. Financialization was necessary to service the global demand for USD. This has led to the endemic corruption, inequality, and debt that has politically polarized American society today.
Worse, financialization has led to the loss of American sovereignty. America’s financial Ponzi scheme demands the seamless movement of capital in and out of America, which has allowed transnational capital to dominate America’s monetary and fiscal policy.
It is impossible to know what Trump truly thinks (even though he won’t stop talking), and it’s possible that he wants to reassert American sovereignty over transnational capital by re-creating the conditions that allowed for America to become great in the first place:
The Wall Street Crash of 1929 and the Great Depression, which destroyed financial speculation and forced Americans to work real jobs again.
The New Deal, which empowered the government to better manage resources, and build infrastructure.
World War II, in which the arsenal of democracy became the factory of war for the British Empire, the Soviet Union, and China from 1941 to 1949.
This is what Trump’s New Deal would look like:
Strategic control over all maritime navigation, forcing nations to bend to American imperial policy or face economically strangulation. America will focus on maintaining mastery over the seas.
A policy of “divide and rule” in Europe, the Middle East, and East Asia: NATO vs Russia, Iran vs Israel + GCC, China vs. Japan. Just as how America helped the Soviet Union against Germany and China against Japan in World War II, it will work primarily to maintain balance of power in each region.
Creation of Greater North America (“the Technate”), which will permit America to provide the world with resources and armaments from the Western hemisphere. Just like the Marshall Plan, America will provide financing to the world, forcing its “allies and partners” to absorb its $40 trillion national debt.
Most of you will protest at the idea that Trump has a plan. Please read America’s national security strategy here, and you will begin to connect the dots.
Will Trump’s New Deal work? It’ll probably end up wrecking both America and the world — but that’s a story for another time.
National Security Strategy of the United States of America (November 2025) :
https://www.whitehouse.gov/wp-content/uploads/2025/12/2025-National-Security-Strategy.pdf
Comments
Post a Comment