Middle powers like India are not picking a side but are 'multi-aligned,' partnering with the US on tech, Russia on arms, and China on other initiatives. This creates a fluid, complex system of shifting, issue-specific coalitions rather than two fixed blocs.
The move toward a less efficient, more expensive global supply chain is not a failure but a strategic correction. Over-prioritizing efficiency created a dangerous dependency on China. Diversification, while costlier in the short term, is a fundamental principle of long-term risk management.
A country's ability to rely on allies for strategic production is undermined by conflicting internal policies. For example, the U.S. seeking shipbuilding cooperation from South Korea while its immigration agents raid a Korean-owned factory sends mixed signals and erodes trust.
A clear sign of the breakdown in global trade consensus was the collapse of a major environmental goods agreement. The entire deal, involving 250 products, failed because China and the EU could not agree on whether to include bicycles, demonstrating the system's inability to resolve even minor disputes.
In trying to compete, the U.S. is mirroring China's protectionism and industrial policy. This is a strategic error, as the U.S. political system lacks the ability to centrally direct resources and execute long-term industrial strategy as effectively as China's state-controlled economy.
The shift away from the post-Cold War trade system started well before Trump. As early as 2009, the Obama administration recognized that the Doha Round framework was unworkable with China's economic model and began warning Beijing that the 'benign international environment' it relied on was at risk.
The Trans-Pacific Partnership (TPP) successfully incentivized countries like Peru to raise labor standards. The carrot wasn't better access to the U.S. market, which they already had, but new access to Japan's historically closed market, which the U.S. helped negotiate.