In the last four to six weeks a significant change has occurred that you may well have missed, but ought to consider. Think back to when President Trump began his second term and the world was hanging on his every word. This was not out of respect or admiration, but concern. Whatever the President of the United States said or did still carried enormous geopolitical and economic weight, and governments, markets and investors understood that.
The so-called “Liberation Day” announcements about “reciprocal” tariffs had the world on tenterhooks. Markets reacted instantly. Governments scrambled to interpret Washington’s intentions. Trump’s statements were dissected, discussed and analysed in real time because there remained a broad assumption that behind the chaos there must still be some coherent grand strategy constructed upon the backs of Washington’s vast institutional experience and expertise.
Fast forward a few months and the tone shifted. It quickly became apparent that many of Trump’s cabinet picks were either woefully underqualified or unable to restrain his worst instincts. Then, commencing with Trump’s and Vice President Vance’s berating of President Zelenskyy in the Oval Office, the world began to watch in growing disbelief as the White House embarked upon one of the most undiplomatic periods in modern American history.
Trump and his administration insulted allies, demeaned Europe despite its role as a vast market for American goods, openly discussed seizing the territory of sovereign nations – and allies no less – mocked historic sacrifices and repeatedly demonstrated either a poor understanding of history or little interest in diplomatic restraint. What began as “What is America doing now?” quickly morphed into “Did he really just say that?”
Now, with the Iran crisis still fresh in everyone’s minds, the tone has shifted yet again. Nobody is really listening anymore.
What began as fearful but intent listening, then morphed into stunned incredulity, has now become dismissal. Since the Iran conflict began Trump and members of his administration have routinely contradicted not only one another, but themselves. Statements made one day are brazenly, seemingly without irony, and unapologetically reversed the next. Threats are issued and then diluted. Red lines appear and disappear almost at random. At this point, many governments, markets and foreign observers no longer treat pronouncements from Washington as reliable indicators of policy at all.
That is an astonishing thing to witness.
For decades, American presidential signalling mattered because allies and adversaries alike believed there was institutional coherence behind it. Even when Washington was aggressive, unpredictable or controversial, there remained an assumption that strategy existed beneath the rhetoric. Under Trump’s second term, that assumption is visibly eroding.
This is not merely a public relations problem for the United States. Credibility is itself a form of power. Deterrence depends upon it. Markets depend upon it. Alliances depend upon it. Once governments begin to conclude that American statements are impulsive, contradictory or simply performative, they stop reacting in the same way. Allies begin planning around Washington rather than with it. Adversaries begin probing boundaries more aggressively. Markets become desensitised to presidential rhetoric altogether.
That is the real danger here.
We warned long ago in our article Requiem Colossus that a second Trump presidency risked accelerating America’s decline in credibility and international authority. Even so, it is astonishing to watch that erosion unfold so quickly, so publicly and with such hubris.
Great powers survive criticism. They survive anger. What they struggle to survive is irrelevance.
That is the direction the United States now risks heading toward.