WHETHER it is neoliberalism or neoconservatism, as seen with the rise of Trump, it fundamentally serves to protect the hegemony of the rentier class while increasing the burden on working people. Since the 1970s, governments, academia, and the media have promoted ideals like free markets, trade, a level playing field, and multilateral trade norms where countries are seen as equal trading partners – at least in principle. The concept of a "flat world" and the "global village" symbolised interdependence between countries based on mutual gains. Tariffs were generally reduced, capital flows were freed from regulations, and many commentators believed in an economic system where power relations were mystified, or the center of power became invisible. Imperialism, for many, seemed like a thing of the past, as if the process of accumulation were entirely detached from power relations. There was a belief that markets, if not entirely eradicating societal asymmetries, at least ensured equal participation rights, making the world appear less unequal, and that one country could no longer be blamed for another’s underdevelopment.

Trump has upended this discourse. His pronouncements over the past few months convey a simple message: the world is not one of equals, nor does the US believe it should be. Weak countries must recognize and accept their subordination to stronger nations. The US, particularly oligarchs like Donald Trump, Elon Musk, Harlan Crow, and Rupert Murdoch, seeks to shape the world according to their own image. The hypothetical Mar-A-Lago accord, proposed by the Hudson Institute – a neoconservative think tank funded by right-wing billionaires – lays out a position paper calling for the U.S. government to restructure the global trade and financial architecture. The Trump shock is disruptive not only because of the arbitrary escalation of tariffs but also to the liberal consensus that power in economic functioning should be marginal. While conflicts in Iraq, Afghanistan, or Palestine were once considered peripheral to mainstream world affairs, Trump clearly and loudly states that to maintain US hegemony, countries must accept conditions favourable to the US, or else face sanctions. This, according to the US establishment, is the new world order of the twenty-first century.

PROPOSED NEW WORLD ORDER

The US establishment argues that since the end of Bretton Woods and the decoupling of the dollar from gold, the US has continuously faced current account deficits, leading to de-industrialization. As the global reserve currency, the dollar is where countries park their trade surpluses as a safe store of value. The US also imports more than it exports, creating massive trade deficits while providing markets for producers worldwide. Additionally, the U.S. maintains 800 military bases across the globe, which it claims protect liberal democracy against authoritarian regimes.

Trump’s position is that countries must pay in various forms to avail themselves of global benefits or public goods provided by the US. This could mean accepting higher tariffs without retaliation, effectively paying a higher entry fee to access the US market, or relocating production to the US to avoid tariffs. US economists assume that the countries facing higher tariffs will absorb the cost by depreciating their own currencies, aiming to maintain their export prices and retain their share of the US market. In other words, the exporting country is expected to absorb the burden of the tariff without passing it on to US consumers. However, it remains unclear how or why such substantial tariff increases would be neutralised by an equivalent depreciation of the exchange rate, which would likely import inflation into the exporting countries through rising import prices.

Additionally, Trump insists that trading partners open their domestic markets to US goods and increase defense spending on US-made weapons. They are also expected to buy long-term US Treasury bonds, which currently offer negative real returns due to inflation. This, in essence, amounts to a subsidy to the US economy. The disruption caused by Trump's tariff announcements is seen as an attempt to establish a new world order by forcing countries into negotiations.

Countries would be categorised into three groups: vassal states, neutral states (who accept higher tariffs without retaliation), and those aligned with China, the "enemy camp." Trump has been explicit that countries will be pressured to conform to US demands. Given the US's control over the global financial system, dissenting countries would be punished through financial means. In essence, the US is weaponising the dollar and instigating a new Cold War, where countries must choose sides between the two global powers: the US and China.

IMPERIALIST PROJECT AND SELF-RELIANCE

For the past five decades, the term ‘imperialism’ was conspicuously absent from academic discourse, media, and public perception. The prevailing narrative was that everyone is equal in the market, and economic outcomes stemmed from rational choices and competition. Power was invisible, or if it existed, it operated at a micro level. Global hegemony was articulated through multilateral organisations and institutionalised rules rooted in reciprocity and interdependence. Many thinkers failed to recognise the structural divisions between hegemonic and dominated countries, with conflicts and wars viewed as peripheral to the grand project of capitalism, which was characterised by markets and democracy. Then Trump arrived, asserting that maintaining the façade of a ‘free market’ and providing global security had become too costly for the US With a declining share of global GDP and a growing current account deficit, the US faced increasing difficulty maintaining the stability of the reserve currency. In response, he imposed taxes on trading partners in various forms. Additionally, he made it clear that he was inclined to restructure the global trade and financial architecture according to defined hierarchies, depending on how countries aligned their interests with those of the US.

Tariffs would hardly be absorbed by the tariffed countries; instead, they would act as a tax on US consumers, who would be forced to pay higher prices for the goods they purchase. Taxing the US public allows Trump to maintain reduced corporate taxes, which were initially set to increase this year. The tax relief for corporations would be funded by tariffs imposed on the working class. However, this would be framed as a strategy to revive manufacturing jobs for US workers. Some investors may be coerced into relocating their production to the US while, for most countries, their domestic markets would be opened up to increased US exports.

There will be increased uncertainty and tension between countries as they must reposition themselves in relation to the new world order. However, the world has changed significantly since the Bretton Woods era. The US share of global GDP has shrunk considerably. In 1944, the US was the manufacturing hub of the world, but now it is China. The BRICS countries now account for 42 per cent of global GDP, while the US share has fallen to 26 per cent. Asia, particularly India, is driving global growth, with India currently recording the highest GDP growth in the world. The world is no longer the same as it was during the Plaza Accord of 1985. Developing countries of the global south now have enough strength to build regional cooperation and counter US pressure. This will gradually reduce the importance of the dollar in the future. Imperialism is knocking at the door, and protecting the autonomy of nations will largely depend on the struggle of working people, who can prevent ruling class parties from succumbing to US pressure.