Global Macro Monitor

After this morning’s events in Caracas, a repost of last year’s piece feels not only appropriate, but unavoidable. What once looked like a theoretical great-power contest is now playing out in real time, across real countries, with real consequences.

If you’re keeping score, the framework is simple. Russia put the first run on the board by moving to take Ukraine. The United States has now answered with its own decisive move in Venezuela, reasserting hard power in its traditional sphere of influence. That makes it one apiece. And China is on deck, watching closely, calibrating responses, and preparing for what it sees as the unfinished inning: Taiwan.

This is not about moral equivalence; it’s about strategic symmetry. Each power is testing how far it can go, how costly action really is, and whether the rules of the post–Cold War order still constrain behavior. Ukraine, Venezuela, and Taiwan are not random flashpoints—they are pressure points in a global system drifting away from diplomacy and back toward spheres of influence, fait accompli politics, and great-power signaling.

Last year’s analysis anticipated this shift. Today’s headlines confirm it.

Originally posted: March 3, 2025

As Trump seems to want to isolate and cut President Zelensky out of the peace negotiations while siding with Putin’s Russia, it conjures up an image of the Big Three – Putin, Xi, and Trump — carving up the world as they see fit.  We sure hope not.  

The Trump administration has, however, embarked on a significant departure from traditional U.S. foreign policy, emphasizing unilateralism over alliances and prioritizing economic negotiations over geopolitical stability. This shift mirrors historical instances such as the Yalta Conference of 1945, where great power negotiations reshaped European borders, and the treaties following World War I that rewrote the borders in the Middle East and beyond and attempted—often unsuccessfully—to enforce a lasting peace.

Trump’s approach to Ukraine, Europe, and global alliances reflects an emerging pattern of prioritizing national interests over multilateral commitments, raising concerns about the potential reordering of global power structures.

The Trump Doctrine: A New Yalta?

At Yalta in 1945, Franklin D. Roosevelt sought to secure a postwar order based on democratic principles but had to compromise with Soviet leader Joseph Stalin, resulting in Eastern Europe falling under Soviet domination. This decision was widely criticized as a betrayal of smaller nations in favor of great power pragmatism​. A similar theme emerges in Trump’s handling of Ukraine. By shifting away from unwavering support for Kyiv and normalizing relations with Russia, the Trump administration appears willing to sideline Ukrainian sovereignty in pursuit of broader strategic objectives​.

Trump’s treatment of Ukraine aligns with the concept of “great power deals,” reminiscent of the U.S. and Soviet agreement at Yalta. The difference is that Roosevelt operated within a multilateral framework, whereas Trump has abandoned such structures in favor of direct power negotiations​. This reorientation represents a radical rethinking of U.S. commitments, raising concerns among European allies who fear becoming bargaining chips in a new geopolitical settlement.

Economic and Military Implications: The European Response

Europe’s reaction to Trump’s foreign policy echoes the aftermath of World War I when European nations struggled to establish an independent security architecture after U.S. disengagement. The Treaty of Versailles and subsequent treaties placed the burden of European security on fragile alliances, which ultimately collapsed with the onset of World War II. Similarly, Trump’s approach to Ukraine and NATO suggests a U.S. retrenchment that may leave European nations more vulnerable​.

European leaders now face a stark choice: to assert their geopolitical independence or risk being sidelined. A recent analysis indicates that defending Europe without U.S. military support would require at least 300,000 additional troops and an annual defense spending increase of €250 billion​. This suggests that European nations must urgently develop self-reliant defense mechanisms, mirroring past efforts to create European security structures in the interwar period.

The Economic Reordering: Parallels to the Interwar Period

Trump’s foreign policy also recalls the economic consequences of post-World War I diplomacy. The punitive economic measures of the Versailles Treaty fueled nationalist resentment and economic instability, leading to World War II. Similarly, Trump’s imposition of tariffs on European allies and his transactional approach to international relations risk disrupting global trade​.

His administration’s proposed “economic reordering” aims to restructure the global economy in favor of U.S. interests, pushing European nations to align with Washington’s new trade and security frameworks​. However, as history has shown, economic isolationism can backfire, as it did in the 1930s when protectionist policies deepened the Great Depression and undermined international cooperation.

Conclusion

Trump’s foreign policy represents a break from the multilateral traditions of the post-World War II order, favoring direct negotiations and economic leverage over alliance-based diplomacy. This shift echoes the compromises made at Yalta and the fragile peace efforts after World War I, both of which had long-term geopolitical consequences. If European nations do not take proactive steps toward greater autonomy in defense and diplomacy, they risk becoming passive participants in a new great power realignment. The historical lesson is clear: in an era of shifting alliances, European nations must assert their sovereignty or risk being dictated by external forces once again.

So, here’s the deal:  Putin gets Ukraine and…Xi gets Taiwan, and Trump gets Canada, Greenland, and the Panama Canal?  God help us.