As we close in on the end of 2018 and get ready to unveil our forecasts for 2019, now is as good a time as ever for some honest introspection. We know we're not the only ones out there who have been burned somewhere along the way in trying to read the tea leaves of U.S. President Donald Trump's presidency. But we now have nearly two years of the Trump administration on the examining table to sort and dissect. We emerge from this process more humbled and a bit battered, but also more enlightened. Here are just a few of the lessons we've learned that we intend to carry into the next year.
U.S. President Donald Trump's unconventional views and tactics have put Stratfor's geopolitical approach to analyzing the world, which emphasizes structural constraints over personality and ideological inclinations, to the test. Nearly two years into the Trump presidency, we now have a number of case studies to use in re-evaluating the strengths and limitations of that method.
Mind the Gap Between Strategy and Tactics
As unconventional as Trump has been in his tactics, U.S. grand strategy has been largely reflective of broader shifts in an emerging world order. That may be difficult to acknowledge in an intensely polarized media environment where a single presidential tweet can spawn an exhausting level of speculation by warring pundits. But our geopolitical methodology teaches us to step back from the relentless news feed, drown out the daily din and allow the personalities of the day to blur in the background to let deeper — and ultimately more impactful — structural forces come into clearer view.
What stands out most prominently are the forces that have been driving the return of a great power competition in the international system and thus U.S. foreign policy at large. The United States was already preparing for a rising confrontation with China at the start of the century until a series of eruptions out of the Islamic world severely sidetracked it. China used that time and space to extend itself economically and militarily to the point that it is now blatantly colliding with a U.S. imperative to maintain dominance in nearly every strategic domain, from the high seas to cyberspace and outer space. Russia all the while has been on a resurgent campaign to rebuild a strategic buffer with the West along its former Soviet belt, running from the Baltics down to Ukraine and the Black Sea through the Caucasus and Central Asia.
Though China and Russia are natural competitors and have little economic compatibility, they are finding common ground in their challenge to the U.S.-led order. The rise of this Eurasian axis is demanding U.S. attention and shaping grand strategy at its highest level. This entails a recalibration away from the all-consuming and ever-ambiguous global war on terrorism toward a sharper, strategic focus on dividing and weakening great power rivals and corralling a host of middle powers that are trying to hold their balance and avoid getting trampled in a far more competitive geopolitical climate.
While the strategic course for the White House was set well before Trump became president, the tactics he has chosen to employ in pursuit of these strategic aims continue to flummox much of the world. For example, the United States' economic competition with China, particularly in the technological realm, was bound to draw in heavier state scrutiny over supply chains to mitigate national security vulnerabilities, resulting in more investment barriers and a lot of angst from multinational tech firms. But burying China in tariffs that can easily come back to bite the American consumer is certainly a Trumpian tactic. The United States has a strategic interest in creating a strong economic bulwark against China; previous presidents saw multilateral trade pacts like the Trans-Pacific Partnership as the key ingredient, while Trump has eschewed such pacts in favor of bilateral deals where hard-hitting demands reduce the room for moderation.
The United States' argument that the stale, consensus-driven mechanics of multinational organizations like the World Trade Organization are inadequate to hold China accountable for its trade abuses preceded Trump, but it is his White House that could drive the WTO to paralysis in 2019 and force countries back on a less stable bilateral path to manage their trade disputes.
While the strategic course for the White House was set well before Trump became president, the tactics he employs in pursuit of these strategic aims continue to flummox much of the world.
When it comes to Middle East policy, the United States facilitated the rise of Iran by invading Iraq. Rather than getting sucked into another destabilizing military campaign in the Persian Gulf, the Barack Obama administration opted for a diplomatic path, setting the stage for the United States to rebalance once again in the region by relying on key Sunni powers such as Saudi Arabia and Turkey to keep Iran in check. However, the Trump tactic (facilitated by Iran hawks such as national security adviser John Bolton) of throwing out the Iran nuclear deal, reimposing hard-hitting sanctions on Tehran and blatantly driving toward regime change is a very different, less predictable approach to containing Iran that comes with its own consequences, which include prolonging a distraction in the Middle East that will hinder the United States' ability to refocus attention on great power challenges.
In other words, the choice of tactics not only can deviate from the grand strategy but can also directly undermine it. The Trump administration's willingness to take certain tactics to an extreme, including tariffs and secondary sanctions, will aggravate and alienate those middle powers that it needs to rely on in this era of great power competition. This puts reactive powers occupying prime geopolitical real estate such as Europe, Turkey, Japan and India in an especially awkward position with Washington while creating space for China and Russia to make deeper inroads in strategic locations.
The Power of Personality and Ideology
While grand strategy can be inferred through impersonal forces, tactics are a more direct reflection of the personality and ideology in play, making this a particularly volatile realm for analysis. And when a particularly strong-minded ideologue has extraordinary decision-making power, the perspectives, influence and mere survival of the personalities that surround the leader will matter all the more in determining when more disruptive tactics are likely to be checked or enabled. This is where we have to carefully remove our noise filter, obsessively follow public figures and incessantly track the daily scuttlebutt, but always with a structural framework to guide what to look for and when to temper overreactions.
A geopolitical approach will tend to put more faith in structural constraints over ideological inclinations. This explains why many analysts, including ourselves, initially underestimated Trump's ideological commitment to reducing the U.S. trade deficit through tariffs and his general belief that a country is "winning" when it exports more than it imports. Trump has maintained this philosophy despite the glaring economic realities of highly integrated supply chains and boomerang effects on U.S. industry and consumerism.
As a result, the daily tracking of White House personalities and their actual influence over trade policy is an exhausting yet necessary undertaking. There are the lonelier, risk-averse moderates like Treasury Secretary Steven Mnuchin who are trying to navigate White House tactics to calm the marketplace. There are the technical trade hawks like U.S. Trade Representative Robert Lighthizer and free trade pragmatists such as Larry Kudlow, director of the National Economic Council, who see the president's tariff obsession as a useful negotiating tactic to bring trading partners to the table, but with an eye toward mitigating economic risk and driving toward a deal. And then there are the hardcore ideologues like Peter Navarro, director of the White House National Trade Council, who share Trump's belief that tariffs can serve as both the means and the end in trade policy. Which personality is up or down on the influence scale with the president can shift by the week (just look at the seesaw between Mnuchin and Navarro over the past year). This can make the difference between Trump following his gut and employing a "withdraw now, negotiate later (maybe)" tactic, like he wanted to do with the North American Free Trade Agreement, or leaving enough room for the moderates to negotiate a deal, much less a truce, with major allies.
The same can be said of the key personalities shaping national security policy. U.S. Secretary of Defense James Mattis has been a critical military check on Trump in managing NATO relations, keeping a strong defense against Russia, ensuring national security waivers on sanctions for key allies and spelling out the costs of military conflict in Northeast Asia and the Persian Gulf. But the exit of foreign policy pragmatists like former national security adviser H.R. McMaster and former Secretary of State Rex Tillerson have left Mattis more isolated and under siege from more ideological hawks like Bolton, particularly when it comes to the next steps in the U.S. campaign against Iran and in the escalating arms race with Russia and China.
Putting Checks and Balances to the Test
The Trump White House is still in many ways following a grand strategy molded by the emerging geopolitical climate, but by force of personality and ideology, is prone to defying constraints and employing tactics that can risk undermining its broader strategic goals. Defying constraints does not always mean overcoming them, however.
The NAFTA renegotiation is an important case in point. The Trump administration used various tactics to push its demands, including tariffs, quotas and waivers, as well as threats of premature withdrawal and splicing the negotiation into bilateral tracks, before ultimately settling on a deal, the United States-Mexico-Canada Agreement. Many will point to this example as evidence that the Trump White House may engage in flashy and coercive tactics, but it will moderate in the end. But we would be wary of stretching the NAFTA-USMCA parallel to other trade negotiations. The impact on North American economic stability from tearing up NAFTA would have carried an extremely direct economic and thus disproportionately high political cost for the White House. Trump himself has confirmed numerous leaks that he intended to withdraw from NAFTA early on despite those costs. But even if moderates in the White House had not gone out of their way to prevent the withdrawal and to steer the administration toward a deal, a NAFTA collapse would have very likely triggered a congressional check preventing the complete rupturing of the agreement.
Defying constraints does not always mean overcoming them.
With a grave threat to U.S. economic stability mitigated through the USMCA, there is now less urgency on the part of Congress to check Trump's trade authority. On China policy, the president has broad legal powers through Section 301 of the 1974 Trade Act, not to mention bipartisan congressional support, to maintain significant trade pressure on Beijing as part of the United States' broader competition with China. Meanwhile, the White House is using the threat of auto tariffs to try and drive the European Union and Japan into more comprehensive trade agreements that address U.S. trade deficit concerns. Japan has a decent shot at negotiating a deal with Washington, but the European Union, constrained by its own political divisions and sensitivities around key sectors such as agriculture, is headed for a big clash with the United States. Still, if these negotiations were to collapse and result in retaliatory tariffs, the economic cost to the United States would in no way compare to the cost, and thus constraint, that would have come from walking away from NAFTA.
Though the executive branch wields more authority in foreign policy than Congress by design, we have witnessed notable checks by Congress and the military establishment on the president that will also bear close watching in 2019. Despite Trump's desire to establish a rapprochement with Russian President Vladimir Putin, U.S. policy on Russia has been remarkably consistent, even conventional. A heavy U.S. congressional check through sanctions and the military's role in managing NATO relations and continuing a steady buildup of assets on Europe's eastern flank have maintained a traditional containment policy toward Moscow as U.S.-Russian geopolitical competition deepens.
A U.S. imperative to maintain a balance of power among Arab Gulf allies has also been upheld by these institutional checks. Mirroring the dynastic order in the kingdom, Trump and his son-in-law, Jared Kushner, have put significant stock into their personal relationship with Saudi King Salman and Crown Prince Mohammed bin Salman. This dynamic resulted in Trump briefly endorsing a hard-line Saudi-Emirati campaign to isolate Qatar before more pragmatic national security figures stepped in to make clear the strategic cost of sacrificing a key military ally in the region and the cost of encouraging Gulf fissures. While the president will continue to shield the Saudi crown prince from a rupture in the U.S.-Saudi strategic relationship over the Jamal Khashoggi crisis, Congress will play a more assertive role in diversifying the United States' royal relationships and in trying to mitigate the liability presented by the crown prince's agenda.
Finally, North Korea represents a case in which the military's ability to hit home the constraints of triggering a regional war and Trump's force of personality have resulted in a policy that rather neatly aligns with the broader geopolitical interests in play. Since North Korea doesn't carry the same ideological baggage that Iran does for Trump, it was easier for him to pursue a diplomatic track and sideline more hawkish advisers like Bolton on how to manage Pyongyang's nuclear antics. In fact, Trump's willingness to break with decades of diplomatic convention and establish a direct rapport with North Korean leader Kim Jong Un was arguably an essential ingredient in getting Pyongyang to explore a more enduring political framework with the United States. Even if full denuclearization of the Korean Peninsula remains an unlikely outcome of this negotiation, the Trump factor in the North Korean negotiation has nonetheless created a unique testing ground for the United States to find a way to coexist with China on the Korean Peninsula. And given the global ramifications of these geopolitical giants coming to blows in nearly every other strategic domain, that is no small thing.