Trump and the World

<Can Trump implement the tariffs he has announced? Legally, who knows, but it’s unclear whether they would do any good.

Donald Trump seems ready to take on the world. Or at least, he is convinced he can. On Saturday, Trump demanded that BRICS, the group consisting of Brazil, Russia, India, China and South Africa and their partners (Iran, Egypt, Ethiopia and the United Arab Emirates) commit to using the U.S. dollar as a reserve currency and threatened to impose 100% tariffs on their goods if they try to abandon it.

“The idea that the BRICS Countries are trying to move away from the Dollar while we stand by and watch is OVER,” Trump wrote on his social media platform, Truth Social.

“We require a commitment from these countries that they will neither create a new Brics currency nor back any other currency to replace the mighty US dollar or they will face 100% tariffs and should expect to say goodbye to selling into the wonderful US economy.”

But if that is a tactic that might work with Canada, Mexico and other countries that have an intimate socio-economic relationship with the United States — and in the case of Canada and Mexico, a very high level of trade — who knows how it might translate to countries that do not have the same degree of closeness.

As bad as it sounds, the U.S. economy is huge and very strong, but it’s not so great without support from Canada and Mexico in the framework of a North American region of integrated production and relative geopolitical unity.

Trump sent his offensive message weeks after the last BRICS summit in October failed to reach consensus on creating a single currency, and a spokesman for the Russian government, one of the BRICS engines, asserted that a common currency was not yet possible.

The fact is that Trump and his bravado have offered new arguments to those in the world who want to find alternatives to the dollar and who have been searching for years without success.

For the time being, it could be said that, so far at least, challenges to the role the dollar plays in the global economic and financial system have been both an unattainable promise and a threat that somehow never materialize.

Certainly, the Chinese yuan would be the currency most likely to compete for the U.S. dollar, but it has been eight years since the International Monetary Fund added it to the basket of reserve currencies, and it has yet to take off, despite China’s growing trade power.

China is the world’s second largest economy, and its economic growth is a challenge, but not yet a challenge to U.S. hegemony.

Trump, then, seems determined, at least to the American public, to portray the U.S. as a country with renewed streng based on the same economy he denounced two months ago and yet magically helped recover 25 days ago.

Can Trump implement the tariffs he announces? Legally, who knows, but it’s unclear whether they would do any good.