The White House (via OMB) strongly protests Congressional efforts within the FY 2027 NDAA to prohibit the purchase of warships from foreign shipyards. The Administration argues that these restrictions undermine national security by limiting flexibility and hindering its strategy of leveraging allied yards, such as in the 'Finland model,' to drive investment into U.S. shipbuilding capacity. This signals a significant policy shift toward integrating international partners into advanced naval construction, suggesting the Pentagon is prepared to bypass traditional domestic build requirements for future combat vessels.
The Americas in Play
English Summary
The Western Hemisphere is bifurcated, with China dominating trade in South America while the US maintains a lead in North America, signaling a decline in US regional influence. A more immediate threat is the rise of complex, state-embedded criminal networks—termed "parallel powers"—which profit from illicit trade (drugs, gold) and are increasingly influencing local politics. To counter this instability and mitigate future geopolitical risks, the US must shift focus from purely competing with China to addressing internal governance failures by targeting the supply and demand sides of illicit markets, while also leveraging regional opportunities like labor and critical minerals.
中文摘要
西半球呈現分化格局：中國在南美洲主導貿易，而美國在北美洲仍保持領先地位，這預示著美國區域影響力的衰退。更迫切的威脅是複雜的、國家嵌入式的犯罪網絡——被稱為「平行權力」——它們從非法貿易（毒品、黃金）中牟利，並日益影響著地方政治。為應對這種不穩定性並緩解未來的地緣政治風險，美國必須將焦點從單純與中國競爭，轉向解決內部治理缺陷，方法是針對非法市場的供需兩端進行干預，同時也應利用勞工和關鍵礦物等區域性機會。
Related Entries
-
1.
-
2.
The Western Pacific remains a highly active theater defined by sustained U.S.-led military exercises and escalating great power competition. Key evidence includes continuous joint operations, such as RIMPAC 2026 in Hawaii and the deployment of CSGs into the South China Sea, juxtaposed with increased naval activity from both China (PLAN task groups) and Russia near Japan's critical straits. These movements underscore a strategic push by non-allied powers to assert presence and challenge regional norms. Policy implications dictate that allied nations must maintain robust multilateral cooperation and interoperability to safeguard freedom of navigation and manage escalating tensions in the Indo-Pacific.
-
3.
The article argues that the post-Cold War era of U.S. unipolarity, established by the perceived invincibility demonstrated during the Gulf War, has ended. This decline is driven by globalization and technological diffusion, which have democratized advanced military capabilities, allowing regional actors to challenge major powers. Consequently, policymakers must prepare for a more volatile international order marked by frequent crises, heightened costs for securing global trade chokepoints, and reduced predictability from American power. The new rules dictate that great powers can no longer effortlessly impose their will through force.
-
4.
The article argues that current market borrowing costs are rising independently of the Federal Reserve's policy stance, challenging the assumption that the Fed controls all rates. Evidence shows significant increases in key rates—such as 2-year Treasuries and mortgages—even while the effective federal funds rate remains steady. This divergence occurs because market rates reflect complex factors like inflation expectations, credit risk, and geopolitical volatility, which are outside the central bank's direct control. Policymakers should therefore recognize that sustainable rate moderation requires credible disinflation and disciplined government budgets, rather than relying solely on Fed intervention.
-
5.
Despite recent trade setbacks, the U.S. retains fundamental structural economic leverage over China, particularly in high-tech sectors and intermediate goods. While Beijing can temporarily weaponize specific resources like rare earths, these chokepoints are vulnerable to diversification efforts by the West. The article argues that the most effective strategy is not unilateral action but coordinated multilateral pressure from U.S. allies across Asia and Europe. Washington must therefore coordinate its economic statecraft with partners to maximize damage to China’s export-dependent model.