Donald Trump's Aggressiveness Signals How Grave the U.S. Economic Situation Is

The desperation with which Trump plunges into conflicts suggests that the financial and economic situation of the United States is far more serious than we had imagined.

The military aggression of the United States against Venezuela, which resulted in the arrest of the Maduro presidential couple at the beginning of the New Year, is part of the Trump administration's extreme reaction, through which it is trying to avoid the collapse of the global order built around the dollar, at a time when traditional monetary instruments have lost their effectiveness.

In the same vein, Trump explicitly warned Denmark-a NATO ally-that within two months he would take control of Greenland; he threatened Cuba, Colombia, and Mexico, and previously put forward claims or coercive scenarios regarding Panama, Canada, and Gaza.

Viewed together with the tariff war (launched during his first term but entrenched in this second term of the American president as a structural instrument of U.S. economic and geopolitical policy), these episodes describe a regime change: the dollar order is increasingly being defended through force, pressure, and coercion.

The fact that the text that follows explains Trump's behavior does not mean that it justifies it, but merely reveals its rationale.

• 1. War and the Threat of Military Force: The Ultimate Guarantee of Order

The United States spends nearly 1,000 billion dollars annually on defense, representing approximately 37% of global military expenditures and almost two thirds of NATO's total, according to SIPRI (the Stockholm International Peace Research Institute). This disproportion is not accidental: it provides the security guarantee that underpins alliances, trade routes, and financial contracts denominated in dollars.

In the case of Venezuela, the stake was not only a hostile political regime, but control over an energy economy removed from the dollar circuit.

The message conveyed is structural: exiting the dollar ecosystem can have existential consequences for the state in question.

The same logic explains the pressure on Cuba or the warnings addressed to Mexico and Colombia, key countries in the regional architecture of Latin America.

War and the threat of military force drastically reduce the room for maneuver of states that might attempt to build alternative financial arrangements. The potential cost of exit becomes prohibitive, according to the SIPRI Yearbook and the Congressional Research Service (CRS).

• 2. Sanctions: the dollar as gated infrastructure

If war is the ultimate instrument, then sanctions are the everyday one. The Treasury Department shows, in the Sanctions Review 2021, that the number of entities sanctioned by the United States increased from approximately 900 in the early 2000s to over 9,400 at present.

Venezuela, Cuba, and Gaza are typical examples of systemic exclusion: asset freezes, blocked access to payments, and trade and financial restrictions. The effect is not only economic, but also institutional: global actors learn that access to the dollar is conditioned on political compliance.

According to the U.S. Treasury - 2021 Sanctions Review; CRS, sanctions transform the dollar from a simple currency into a network with access rules, in which the United States controls key nodes (banks, clearing, insurance).

• 3. Tariffs: disciplining through market access

Tariffs imposed by the United States, especially in relations with China, but also used as a threat toward Mexico or Canada, do not have fiscal revenues as their primary purpose. They are negotiating instruments. According to the CRS and the U.S. International Trade Commission (USITC), the United States has applied tariffs of up to 25% on imports worth approximately 370 billion dollars.

Tariffs force partners to accept trade and financial rules compatible with the dollar ecosystem, under the threat of losing access to the world's largest consumer market, as shown by CRS, USITC, and the WTO.

• 4. Technological restrictions: control of the productive future

Through the Entity List and export controls administered by the Department of Commerce (BIS), the United States limits rivals' access to critical technologies. In 2024, a single rule published in the Federal Register added more than 120 entities to restrictive lists.

This instrument directly affects the ability of the targeted states to build competitive industries and, implicitly, to generate autonomous financial systems.

The instrument maintains the technological advantage of allied economies and forces global financing to remain anchored in jurisdictions compatible with the dollar, according to the Federal Register; BIS - U.S. Department of Commerce.

• 5. Dollar liquidity: a reward for compliance

Alongside coercion, the United States offers the ultimate reward: access to dollar liquidity. During the crises of 2008 and 2020, the Federal Reserve provided, through swap lines, hundreds of billions of dollars to allied central banks, preventing the collapse of the global payments system.

Compliant states benefit from stability; non-compliant ones are excluded. It is a carrot-and-stick system applied on a global scale (Federal Reserve; BIS; Brookings Institution).

The aggression against Venezuela and the threats directed at Cuba, Mexico, Colombia, Greenland, or previously Panama, Canada, and Gaza are not isolated episodes, but manifestations of the same fact: the dollar order can no longer be maintained exclusively through yield, stability, and economic attractiveness.

The United States uses a coherent package of power-military, financial, commercial, technological, and political-to keep the center of gravity of the global system anchored around the dollar.

Why this aggressiveness indicates a severe economic condition of the United States

All these instruments of external coercion would be useless if the U.S. economy still had the room for maneuver that characterized the post-1980 period. The central problem is that the United States has entered a zone of structural constraint, in which internal economic mechanisms can no longer sustain the global order without the support of force.

First limit - public debt

According to U.S. Treasury - Debt to the Penny, federal debt has exceeded the threshold of 34,000 billion dollars, and the Congressional Budget Office (CBO, Long-Term Budget Outlook) shows that the trajectory is explosive even in scenarios without recession. Budget deficits are structural, not cyclical: they persist regardless of the economic cycle, which means that the American state no longer has internal correction mechanisms.

Second limit - the cost of interest

According to U.S. Treasury - Interest Expense on the Federal Debt, annual interest spending has exceeded 1,000 billion dollars, approaching the level of the defense budget. For the first time in modern U.S. history, interest becomes a direct competitor to strategic spending. The Federal Reserve, in the Financial Stability Report, warns that the high level of debt amplifies systemic vulnerability and reduces room for response in future crises.

Third limit - exhaustion of monetary instruments

After a decade of zero interest rates and quantitative easing, the Federal Reserve faces a paradox documented by the Bank for International Settlements (BIS): high rates are necessary to control inflation, but they destabilize public debt and financial markets. A return to ultra-accommodative policies would risk a dollar crisis; maintaining high interest rates erodes the federal budget.

Fourth limit - fragmentation of the global system

The International Monetary Fund (IMF - Global Financial Stability Report) shows that financial and trade fragmentation reduces capital efficiency, increases financing costs, and weakens global growth. For the United States, this fragmentation is both cause and effect: it is the product of the use of coercion, but also the consequence of the loss of the capacity to maintain global order exclusively through economic attractiveness.

When interest becomes a direct competitor to strategic spending, the United States must choose between paying interest to bondholders and financing aircraft carriers.

The system enters an existential crisis.

This tension explains why Trump (or any administration in this context) would resort to coercion: to force the rest of the world to subsidize, through various mechanisms, this power deficit.