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FINANCIAL TIMES
The
New World Order: Donald Trump goes it alone
The decision to pull out of the Iran deal is the latest
example of the administration’s aggressive unilateralism
Gideon Rachman
Can America run the world without allies? That, in essence, is the
question raised by US president Donald Trump’s decision to pull out of a
painstakingly constructed international agreement to restrain Iran’s
nuclear ambitions.
The unilateral exercise of US power is an idea that has long attracted
John Bolton, the White House’s newly appointed national security
adviser. Speaking in 2000, Mr Bolton suggested: “If I were redoing the
[UN] Security Council today, I’d have one permanent member because
that’s the real reflection of the distribution of power in the world.”
Now Mr Bolton is working for a US president who shares his dismissive
attitude to international co-operation. In pulling the US out of the
Iran nuclear deal, Mr Trump has rejected personal entreaties from the
leaders of France, Germany and the UK.
The Iran decision is just the latest and most serious example of the
Trump administration’s aggressive unilateralism. Last June, Mr Trump
withdrew the US from another big international agreement — the Paris
accord on climate change. Next week, the US will take the symbolic step
of relocating its embassy in Israel to Jerusalem — a move that has been
rejected by all its major allies. Mr Trump is also launching an assault
on the global trading system — by threatening to impose swingeing
tariffs, not just on China, but also on key allies such as Japan, Canada
and the EU.
These policies are not just “America First”. Increasingly, they look
like “America Alone”. The Trump administration’s stance on Iran is
rejected by all the other signatories to the Iran deal (France, Germany,
the UK, China, Russia, the EU) — although it does have the support of
Israel and Saudi Arabia. Similarly, Mr Trump’s approach to trade and
climate change has not attracted any significant allied support.
American unilateralism will have direct consequences in the Middle East.
It will also have indirect consequences for the wider world.
Jake Sullivan, an official in the Obama administration who took a
leading role in secret US-Iran talks, thinks that Tehran will feel
compelled to respond to the American withdrawal, “but not in a way that
generates an immediate crisis”. He suggests that the Iranians will try
to choose relatively unprovocative steps, such as “stepping up research
and development on advanced centrifuges”.
Even a relatively cautious response, however, will empower those in the
US, Saudi Arabia and Israel who want to see military action against
Iran. The president himself may see his gambit simply as a means to
ratchet up pressure on Iran — and so force deeper concessions. By
contrast, key Trump advisers such as Mr Bolton may genuinely want a war
— with the ultimate goal of provoking regime change in Iran. In a 2015
newspaper opinion article about Iran, Mr Bolton argued that “only
military action . . . can accomplish what is required”.
Even if it does not lead to a new conflict in the Middle East, the
decision to rip up the Iran deal has opened up a grave rift within the
western alliance. When George W Bush chose to invade Iraq in 2003, the
US broke with France and Germany. But the Bush administration did still
have some important European allies over Iraq — including the UK, Spain,
the Netherlands and Poland. Yet on Iran, the US has no evident European
support.
Instead, there is quiet fury in Europe. The Europeans have discussed
whether they can continue with the Iran deal by simply refusing to be
bound by US sanctions. But that will be very difficult, for reasons that
go to the heart of America’s unilateral power. The US can make European
companies such as Airbus and Total choose between the American and
Iranian markets.
America’s economic power goes well beyond market access. In extremis,
European executives who continue to do business in Iran could become
subject to arrest if they travel to the US. And European banks that do
business with Iran could find themselves shut out of the US financial
system, or subject to prosecution and massive fines in America. “German
companies doing business in Iran should wind down operations
immediately,” Richard Grenell, the new US ambassador to Germany, warned
on Twitter on Tuesday.
All of this reflects the role of the US dollar as the world’s reserve
currency — something that was labelled as an “exorbitant privilege” by
Valéry Giscard d’Estaing, a former French president. It is the dollar,
as much as American military might, that allows the US to coerce its
allies — as well as its adversaries.
The power of American sanctions and the reach of the US judicial system
has been demonstrated in recent years. It is what allowed the US
recently to crack down on the business of Oleg Deripaska, a Russian
oligarch with links to the Putin government. European businesses and
banks were forced to cut links with Mr Deripaska’s Rusal, by the threat
of secondary US sanctions. Even executives from Fifa, world football’s
organising body, discovered the international power of the dollar when
they were arrested in Switzerland in 2015 and later extradited to the US
to face corruption charges. Their legal vulnerability, it turned out,
was that they had used American banks.
America’s central role in the global financial system hands any US
administration an immensely powerful economic weapon. But the weapon’s
power could be eroded if it is used too often. Both Russia and China
have discussed trying to set up alternative international payments
systems that bypass the US and use currencies other than the dollar. The
Europeans may now also be tempted to join this effort, particularly if
it provides an opportunity to boost the international role of the euro.
But the euro is still a relatively new currency, the Chinese renminbi is
not fully convertible and the rouble is not a plausible challenger.
Moreover, even companies trading outside the US and using euros are
still potentially subject to the threat of exclusion from American
markets. The day when an international business can cheerfully swear off
using the dollar and avoid US markets still seems a long way off.
Such clout might tempt Mr Trump to believe that he has considerable
scope for cost-free unilateralism. America’s allies may harrumph that it
is unacceptable for the US to walk away from the Iran deal or the Paris
climate accord, but there is not much they can do about it. After all,
European allies depend not only on the dollar, but also, as Mr Trump
repeatedly reminds them, on American military protection.
There is talk that Europeans will now be prompted to “do more” for their
own defence, as well as deepening the integration of the euro. German
chancellor Angela Merkel has made it clear she believes the US “is
fundamentally abdicating its global leadership role”, says Mr Sullivan.
But any steps are still likely to be incremental — given the political
and practical difficulties of integration.
America’s Asian allies face a similar dilemma. Japan is clearly unhappy
about measures such as the withdrawal from the Trans-Pacific Partnership
deal and the threat of steel tariffs. But Tokyo, which is watching
warily as Mr Trump plans talks with North Korean leader Kim Jong Un ,
has no easy alternative to the US security guarantee.
However, the Trump administration’s unilateralism will not be cost-free
— even if the costs are not immediately apparent. Its network of
alliances sets the US apart from the nations that the administration has
identified as America’s strategic competitors — Russia and China. Its
allies do bring real assets to the table. Military bases overseas are
the basis of its global reach. Intelligence-sharing between allies helps
the US to contain the terrorist threat. In addition, like-minded
partners help to mould legal and trading standards.
Above all, these alliances give the US legitimacy when it seeks to
exercise power. It is not feasible for America to respond to every
challenge through the use of military might or economic sanctions. In
normal times, the US relies on the “rules-based international order” — a
network of laws and institutions that it and its allies have largely
shaped over many decades. In seeking to respond to Russia’s annexation
of Crimea, or China’s claims in the South China Sea, the US has appealed
to international law and sought to rally the support of other nations at
the UN and elsewhere.
But for a rules-based order to work, the US has to be able to
demonstrate that it is willing, on occasion, to be constrained by the
rules — by accepting unwelcome judgments at the World Trade
Organization, for example, or provisions in the Iran nuclear agreement
that are not ideal.
It is those constraints on American power that Mr Trump and advisers
like Mr Bolton no longer seem ready to accept. So rather than relying on
a system built around rules, the Trump administration is seeking to move
to a power-based order — in which the US lays down the law and others
are compelled to follow. That may work for a while, but it is also an
invitation to rivals to test America’s will through unilateral actions
in Europe, Asia and the Middle East. And that is a recipe for a much
more dangerous world.
USEFUL SUMMARY
"The decision to
pull out of the Iran deal is the latest example of the administration’s
aggressive unilateralism," Financial Times chief foreign affairs
commentator Gideon Rachman writes from London
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