It's Strategy, Not Chaos: Forget the Noise & See Trump's REAL Tariff Endgame
(Introduction)
"Tariffs is the most beautiful word to me in the dictionary," President Trump once declared. Yet, to many observers, his administration's recent volley of tariffs – hitting allies and rivals alike under emergency powers – looks like pure economic chaos. Markets shudder, economists warn of recession, and allies feel betrayed. Trump himself seems to change his mind between breakfast and lunch. What the heck is going on? Why hit friends with tariffs? Does he no longer care about crashing the stock market? Does this guy actually have a plan?
Believe it or not, the answer appears to be yes. Forget the noise of the daily market swings and the seemingly erratic pronouncements. Behind the apparent chaos, a specific, ambitious strategy seems to be unfolding, driven by key figures in his new economic team. As his Treasury Secretary, Scott Bessent, recently stated, Trump's tariff policies have "begun the process of reorienting our international economic relations."
Begun the process. That's the key phrase. The current tariff "chaos" isn't the end goal; it's the disruptive opening act of a much larger play – one aimed at fundamentally reshaping the global trading and security order that America itself built decades ago. We might be witnessing the dawn of a new era, as significant as the shifts that occurred in 1944 with Bretton Woods or in the early 1980s with the rise of the neoliberal order.
This new order envisions a world starkly divided – perhaps into what Bessent calls "green, yellow, and red buckets," where status dictates everything from tariff levels to military protection and even access to US dollars. So, what is this MAGA master plan for a new global order? Is it feasible, or just a dangerous fantasy? To understand, we need to get inside the MAGA mindset.
The Players & The Problem
Trump's economic brain trust features influential figures like Treasury Secretary Scott Bessent (a wealthy hedge fund manager, formerly of Soros Fund Management, who famously helped "break the Bank of England" and taught economic history at Yale) and top economic advisor Steven Miran (Harvard, hedge fund strategist, author of the widely discussed paper "A User's Guide to Restructuring the Global Trading System").
Both Bessent and Miran are intensely focused on what they see as the single mortal threat to the United States: deindustrialization.
Conceptually, imagine a chart showing US manufacturing's share of economic output plummeting from nearly 30% in the 1950s (a true manufacturing powerhouse) to just 10% today. Trump's first trade war didn't reverse this trend. But why does this decline matter so much to his team when the overall US economy is larger than ever?
Two core reasons:
The Heartland: Deindustrialization devastated the American industrial heartland, communities whose votes were crucial for Trump's 2024 victory.
National Security: US industrial capacity now lags significantly behind competitors, especially China. This creates a massive disadvantage in any potential conflict. As VP JD Vance noted, a single state-owned Chinese firm recently built more commercial ships in one year than the entire US has produced since World War II. Civilian industrial capacity is vital for rapid militarization.
Given this existential concern, the drive to re-industrialize makes sense from their perspective. But why the aggressive, broad tariffs, even against close allies? Why attack the very system the US designed? To answer that, we need a quick history lesson.
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A Brief History of US-Led Global Orders
The deindustrialization trend didn't happen in a vacuum; it unfolded under two distinct global orders, both architected by the US. Understanding them is key to understanding Trump's plan today.
The Bretton Woods Order (Approx. 1944-1973):
Born from WWII's ashes, it aimed for stability and reconstruction.
The Deal for Allies (Green Bucket v1.0): Fix your currency to the US dollar (itself tied to gold), rely on the US for military protection (NATO, US-Japan treaty), and the US will help you rebuild (Marshall Plan, favorable market access even while allies shielded their own markets).
The US Payoff: Contained communism with strong allies, created rich export markets for US goods, and cemented the US dollar as the global reserve currency, granting the "exorbitant privilege" (France's term) – the ability to spend more abroad than earned without facing a currency crisis, thanks to global demand for dollars.
The Downfall (Triffin Dilemma): The growing global economy needed more dollars than the US gold reserves could credibly back. Choosing between creating more dollars (debasing the gold link) or restricting dollar supply (killing global growth) led Nixon to suspend gold convertibility in 1971, ending the system.
The Neoliberal Order (Approx. 1980s-2016):
Ushered in by Reagan and Thatcher, characterized by: Lower tariffs, fewer investment barriers, flexible exchange rates, and broad US security guarantees for anyone playing by market rules.
The New Deal: Less structured. Countries used the dollar out of convenience and reliability. Any nation could gain access to the vast US consumer market and US Navy protection by joining the WTO system. Developing nations often got preferential tariff treatment (hoping wealth would make them friendly, like post-WWII Germany/Japan).
The US Payoff (Exorbitant Privilege on Steroids): With flexible exchange rates, Miran argues, global demand for dollar assets pushed the currency's value far higher than needed for balanced trade. This strong dollar funded the US military globally and made Americans richer on average.
The Downside: The strong dollar made US manufacturing uncompetitive, accelerating deindustrialization (the "China Shock" post-2001 WTO entry was brutal). It also primarily benefited asset holders, worsening inequality. This combination fueled Trump's 2016 election, arguably marking the end of the unquestioned neoliberal consensus.
First Term Failures & The Current Dilemma
Trump's first trade war (mostly targeting China) failed to stop deindustrialization or China's industrial rise, partly due to retaliation and trade rerouting. Biden's subsequent massive subsidies (IRA, CHIPS Act) spurred factory construction but ballooned the deficit without solving the underlying competitiveness issue caused by the strong dollar, according to Bessent and Miran.
This leaves the Trump team facing the core dilemma: The neoliberal order secured US global power and wealth via the dollar's exorbitant privilege, but at the cost of strategic industrial decline. How do you reverse deindustrialization without sacrificing the dollar's reserve status and the power it confers? As Trump himself said, losing the reserve currency means "third world status."
Most economists believe these two goals are fundamentally incompatible. But Miran's work suggests a path – a way to have your cake and eat it too.
The 3-Step MAGA Master Plan
Based on Bessent's and Miran's writings and statements (before and after joining the administration), a three-step plan seems to emerge. Note: This isn't an officially published blueprint, but a reconstruction based on their public views.
Step 1: Tariff Chaos (Current Phase - Creating Leverage)
This is where we are now. The administration applies broad, high tariffs to friends and foes alike, signaling it means business and no longer prioritizes short-term market stability or diplomatic niceties.
The explicit goal, according to Bessent, is using tariffs as a negotiating tool. Miran previously wrote that his proposed policies would likely follow after tariffs had created "sufficient negotiating leverage."
The Takeaway: View the current disruption not as the final state, but as a deliberate tactic to force concessions and bring partners to the negotiating table for the real changes.
Step 2: Reciprocal Tariffs (The Level Playing Field)
The long-term tariff goal isn't necessarily permanent high tariffs everywhere, but achieving reciprocity. If Country X tariffs US goods at 20%, the US tariffs their goods at 20%. If they raise theirs, the US automatically matches.
The theory (per Bessent): This levels the playing field, rewarding "ingenuity, security, rule of law" instead of "wage suppression, currency manipulation, IP theft."
Why it Might Work (Contra 1930s): Miran argues the US has unique leverage. Because everyone needs dollars and access to the US market ("There's no alternative"), the burden of tariffs falls disproportionately on exporters to the US. Extending tariffs globally prevents the rerouting seen in the first trade war.
The Intermediate Goal: Use this leverage to push trading partners towards "some manner of currency accords in exchange for a reduction of tariffs" (Miran).
Step 3: A "Mar-a-Lago Accord" (The New Order)
The ultimate endgame: A new international agreement, potentially rivaling Bretton Woods or the 1985 Plaza Accord (where major nations collectively intervened to adjust currency values against the dollar).
Connecting to the Buckets: This is where Bessent's Green/Yellow/Red buckets likely come in. Miran (before joining the administration) discussed ways to weaken the dollar while keeping it central. While avoiding specifics now (likely for negotiation reasons), he has said that if the dollar weakened enough to balance trade deficits, many problems tariffs aim to fix would disappear.
The Speculative Deal: Imagine a Bretton Woods-like structure (minus gold). "Green" countries (closest allies) might loosely peg to the dollar but agree to collectively appreciate their currencies against it when it gets too strong (weakening the dollar controllably). In return, they get preferential access to the US market, the dollar system, AND US security protection... but perhaps now having to pay for that protection (Bessent's "interlinkages"). Red/Yellow countries face reciprocal tariffs and less favorable terms.
The Payoff (If Successful): This structure could theoretically allow the US to achieve a weaker dollar (boosting domestic manufacturing competitiveness) without losing the reserve currency status, as the dollar remains the central peg/reference point for the "Green" bloc.
The Catch: Can It Actually Work?
This framework – Tariff Chaos -> Reciprocal Tariffs -> Mar-a-Lago Accord – provides a potential strategic logic behind the administration's seemingly disruptive actions. It aims to use leverage to force a new settlement that allows both re-industrialization and retention of the dollar's exorbitant privilege.
Theoretically, it addresses the core dilemma. But there's a massive catch: Trust.
Bretton Woods and the Plaza Accord worked because allies trusted the US to lead fairly and uphold agreements. For countries to voluntarily enter a new "MAGA Order" where they might:
Commit to raising their currency's value against the dollar (hurting their own export competitiveness).
Continue relying on US military protection but now pay tribute for it.
Essentially subordinate their economic policy to US demands...
...requires an enormous leap of faith. Can allies trust an administration that tears up deals (like the original NAFTA), uses aggressive rhetoric ("friend has been oftentimes much worse than foe"), and potentially threatens allies? If key partners refuse to join this new order as "Green" countries, the plan likely fails.
The US would then face the stark choice it tried to avoid: give up the dollar's exorbitant privilege to truly re-industrialize, or keep the privilege and accept continued reliance on foreign manufacturing.
Conclusion
So, is it strategy or chaos? The evidence presented by Trump's own advisors suggests there is a strategic framework – an attempt to leverage US market power to force a new global economic settlement more favorable to US industrial interests, while preserving dollar dominance. The current tariff upheaval is presented as a necessary, temporary phase to gain negotiating power for a radical restructuring built around reciprocity and potentially new currency accords.
Whether this ambitious, historically revisionist plan is feasible hinges almost entirely on whether the US can rebuild enough trust with key partners to convince them to join the proposed new order. Without that buy-in, the "endgame" may remain elusive, leaving only the chaos.