By Tom Fowdy
As reported by Reuters last week: "President Donald Trump… announced an unprecedented U.S. push to take control of a fifth of Venezuela's vast oil reserves, betting that American companies can revive the OPEC nation's battered energy industry while delivering a new source of crude to help bring down U.S. fuel prices."
The usurping of Venezuela's oil resources comes following the Trump administration having forcibly deposed Nicholas Maduro's regime at the start of this year in a targeted abduction operation, accusing him of facilitating drug operations. After this, the White House made it clear that they would effectively "run" Venezuela, and the new regime has subsequently emerged as a pro-US-aligned state who subsequently left the International Criminal Court (ICC) on the President's orders precisely because it prosecutes Israel.
I find the situation bittersweet: First, I have to admit this pathway is ultimately better for Venezuela, not because I necessarily "agree" with everything the US is doing, but because of the reality they have established here with their own statecraft. The United States intentionally crippled the economy of Caracas using sanctions, on top of its own mismanagement, and transformed it into an impoverished state unable to benefit from the one asset it had: Oil. Now, it is undeniable that Venezuela will have sanctions removed, it will be integrated back into the global economy, and it will prosper, even if its oil revenue is clearly serving the interests of a superior party.
That of course, is the very reason the United States wanted to strategically control the country in the first place, but unfortunately, it tells a story that goes far beyond Venezuela. The United States, especially the Trump administration, is committed to comprehensively crippling the economy of any country that, without its own decisive leverage, goes too far in opposing America's interests. We see the same scenario in the US blockade of Cuba, of Iran (with the D-Day sanctions campaign now in place), North Korea (probably the only small country to defy this) and before the Assad regime fell, Syria too.
In my perspective, there is one clear message: You can prosper if you subordinate your interests to America, or you can stagnate through total economic stagnation in the form of sanctions and isolation. The United States does not have that kind of leverage against China, and is even limited against Russia and North Korea, but there is a clear strategic pattern in Trump 2.0 whereby he aims to pick off smaller states who are clear cut opposed to America through economic warfare and regime change, making their prosperity conditional on total subjugation to US interests, there is no middle ground. Venezuela two paths, it could remain impoverished under Maduro, or prosper slightly more as a US client state.
For allies and non-aligned countries, the equation remains the same, just less destructive. They either submit to US interests on economic and market terms, offering unilateral, one-sided benefits to America, or to be slapped with tariffs, which is a choice between lower ones (compliance) or higher ones (rebellion). The objective is the same: The Trump administration's foreign policy is built upon securing economic dominance by essentially coercive means, removing adversarial states from the map and re-writing global commerce into a unilateral system that benefits America.
Thus, while Trump thus does not challenge China on "ideological" grounds anymore, i.e needlessly provoking them over sovereign-related issues or creating a Cold War paradigm, he has nonetheless simplified the entire premise to non-hostile, economic competition whereby the US intends to try and progressively isolate Beijing by rewriting the system against them.
For example, the US moves to terminate allied regimes such as Maduro's Venezuela, removing its oil from Chinese benefit to America, while nonetheless simultaneously economically crippling other ones, such as Cuba or Iran. Meanwhile, Trump tries to force third allies to lock into "choose between us or them" deals, for example, telling Vietnam they will face a 30% tariff if they act as a medium for Chinese goods, of which the US gets to interpret. Or on the other hand, trying to form exclusive economic coalitions against China, such as Pax-Silica.
What you see here is an economic war by other means, and this is the true foreign policy of Trump 2.0. Whilst it is not "decoupling" as were feared in the past, precisely because it avoids ideological confrontation and rejects the idea of China as an "enemy", likewise recognising it can be an opportunity, it has one goal in mind, and that is to win the economic game and re-write the rules in Washington's favour. How successful Trump will be here is only something time will be able to tell, it could easily backfire or even hurt the US, but nonetheless this is the game, and China must utilise careful diplomacy in order to ensure it is never shut out.
The views do not necessarily reflect those of DotDotNews.
Read more articles by Tom Fowdy:
Opinion | How India's misinformation machine targets China over the Nepal floods
Opinion | The growing Transatlantic rift over Israel-Palestine
Comment