Trump 2.0 unleashes havoc on the global order

Let’s start by saying we cannot avoid talking about Donald Trump in his second term as US President.

Every day, scholars, journalists, pundits, activists and ordinary folk are raising Trump-generated noise. This outpouring of assorted issues touch on geopolitics and economics, whether at the global, regional, national or local level.

Undeniably, Trump has become one of the most impactful developments of our present time.

What will be the global impact of the plethora of policies and actions that Trump has already unleashed? It is early days yet, but already the implications look serious.

Let’s look at some of the immediate consequences and speculate on some medium and potential long-term consequences for the global order and especially for Southeast Asia.

The reason for the emergence of the Trump phenomenon and his election as US President for the second time needs to be understood.

It is premised on the deep narrative of a decline of American power globally. This is something that has been troubling American intellectual circles and its political class for some time.

The underlying tenet of this narrative is that China will overtake the US as the wealthiest country sometime soon in the 21st Century. As a corollary of the American economic decline, its political supremacy (or ‘hegemony’) in global affairs will be lost.

The angst that this narrative has created domestically in the US, along with many failing internal and external policies, has led to the phenomenon of Trump.

Trump has been elected for the second time on his Maga (Make America Great Again) platform and its complementary “America First” posture. Both slogans are ironically an admission that America has indeed lost or is losing its number one spot globally.

An element of exaggeration exists in the Maga narrative. American political, economic, military hegemony will remain prevalent for a long time, even if China were to overtake the US economically as the largest global economy. For instance, the US dollar remains the primary reserve currency and dedollarisarion efforts by Brics have been stalled.

American domination – in education, the sciences, the arts, even many areas of technology – is also bound to prevail for some time because of its first-mover advantage.

However, American soft power – the attractiveness of its socio-political institutions, including its democracy – faces a steep decline.

Within the span of a month of Trump’s inauguration, he wreaked global and domestic havoc with his policies and actions.

As a follow-through of Trump 1.0 policies, the clutch of new policies aim to retain US economic dominance and political hegemony.

The Trump disruptions have destabilised the global economic and political order, underpinned by America itself in the post-World War Two era.

Let’s zoom in on the most shocking and immediate impacts of Trump 2.0:

Trump’s unleashing of his plethora of policies since his inauguration on 20 January is no less than an attempt at dismantling the global neoliberal order, which was what US hegemony had helped establish in the first place.

What is most sinister is Trump’s corporatist ideology, which harks back to the likes of Italy’s Mussolini and Germany’s Adolf Hitler. It is an ideology that subjects individual rights to the paramount goals of an ultra-nationalist, authoritarian state.

His radical protectionism, anti-immigration stance and reduction of Nato commitments aligns with this ideology. So too his imperialist ambition to gain new territories such as Greenland, Panama, Canada and Gaza.

Two American academics who, like me, believe Trump’s ideology is corporatist are Nobel Memorial Prize winner Edmund S Phelps (Columbia University) and the late anthropologist David Graeber (London School of Economics). For an analysis, check out this video.

What will the current disruptions of Trump lead to in the medium and longer term?

In the worst-case scenario, it could result in global depression, like the one in the 1930s.

Economist Jayant Menon puts it like this:

The Trump tariffs could lead to an all-out trade war, as happened in 1930 when the US unilaterally raised around 900 tariffs by about 40 to 60 per cent. This prolonged the Great Depression and world trade contracted by a startling two-thirds. There no reason to expect a different outcome this time around. 

Trump’s policies are those aimed at a deglobalisation and a debunking of the neoliberal international order.

The withdrawal from the United Nations Framework Convention on Climate Change (UNFCCC), apart from the immediate impact on climate change, also aims at dismantling multilateral institutions not to his liking, including many agendas of UN agencies.

The harmful impact of Trump’s polices on the world could force leading states and regional groups (the EU, Brics, Asean) to establish enough of a loose alliance to check the descent to the global disorder that Trump is causing.

Humanity awaits with bated breath to see if this will happen.

Johan Saravanamuttu Co-editor, Aliran newsletter 20 February 2025