Nobel Prize-winning economist: Trump may have 'irretrievably' destroyed key US alliances

The term "Pax Americana" (which is Latin for "American Peace," similar to "Paz Americana" in Spanish or "Pace Americana" in Italian) refers to a period of relative stability the West enjoyed for many years after World War 2. According to the concept, the alliances between the United States, Canada and countries in Europe — including members of the North Atlantic Treaty Organization (NATO) — kept the Pax Americana strong.

Liberal economist Paul Krugman considers Trumpism and the MAGA movement harmful to the Pax Americana — an argument he made in an October 16, 2023 column for the New York Times and a column he posted on his SubStack page on February 10, 2025. With Donald Trump now seven months into his second presidency, Krugman revisits the Pax American subject in an August 29 Substack column — and he warns that Trump is "throwing away" everything the Pax achieved.

"For today's post," Krugman explains, "I thought I would enlarge on this point — and on what we've lost, possibly irretrievably, thanks to just a few months of Trumpism. The Pax Americana that emerged after World War 2 — and basically ended on January 20, 2025 — was, in many ways, an American Empire. Even after Europe recovered from wartime devastation, the United States retained a dominant economic and military position among non-communist nations. And we built international economic and military alliances to support a world order in effect designed to U.S. specifications."

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Krugman continues, "But for Europe and Japan, the American Empire was a subtle thing, with the United States avoiding crude displays of power and bending over backwards to avoid being explicit about its imperial status."

Trump's aggressive tariffs and attacks on longtime U.S. allies, Krugman argues, have done a lot to damage the Pax Americana and hurt the United States both militarily and economically. And he makes his point by embedding a live YouTube video of David Bowie performing "This Is Not America" (which he wrote with jazz guitarist Pat Metheny) in 2000.

"In just seven months," Krugman warns, "Trump has completely ripped up the foundations of the Pax Americana…. Trump has vandalized the world trading system as casually as he has paved over the Rose Garden. We haven't yet had a test of whether he would honor our obligations under NATO, but he's said that his willingness to abide by the most central obligation, the guarantee of mutual defense, 'depends on your definition'…. In a world in which America is no longer the dominant economic and military power it once was — measured by purchasing power, China's economy is already 30 percent larger than ours — our role in world affairs depends, even more than it did in the past, on having willing allies who trust our promises."

Krugman adds, "We used to be very good at having allies. But Trump has flushed all of that down the golden toilet."

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Paul Krugman's full SubStack column is available at this link.