The Globalists Have Fallen

When the Dow Jones industrial average closed at a record high on Jan. 26, it looked like the reigning wisdom about Donald Trump and his presidency might be all wrong: Trump had sold himself to voters as a fire-breathing nationalist eager to rip up trade deals, stick it to Wall Street, and impose Steve Bannon-style protectionism. But Bannon was gone, stocks were booming, and ex-Wall Street luminaries such as Gary Cohn and Dina Powell appeared to have the upper hand in the White House following the passage of tax reform. Trump seemed to revel in his unexpected status as hero of the business community and the reassessments it prompted. That same day, he returned from overseas to a triumphant headline in the New York Times: “Trump Arrived in Davos as a Party Wrecker. He Leaves Praised as a Pragmatist.”

- Robert Schmidt, Jennifer Jacobs, Margaret Talev, & Max Abelson

The glow of success fell especially brightly on Cohn, the director of the National Economic Council, who was widely seen as a primary architect, and chief beneficiary, of Trump’s string of victories. He seemed ticketed for bigger things. Privately, Trump discussed making him his next chief of staff.

But appearances can deceive. Six weeks later the globalist glow has vanished, Trump has reverted to his nationalist impulses with the steel and aluminum tariffs, the White House is once again in turmoil—and Cohn is on his way out the door. On March 6, after a bitter internal dispute over tariffs, he announced he was resigning. Cohn, a Democrat who strongly favoured free trade, said in a statement that it had been an “honour to serve my country and enact progrowth economic policies” and thanked Trump for giving him the opportunity. Markets were spooked by the whiplash. As Cowen Inc. analyst Chris Krueger wrote in a note to clients, “Wall Street just lost its security blanket.”

Trump’s presidency has been marked by seasons of chaos and calm that have yielded policies that swing between globalist and nationalist. These outcomes are often driven by his mood and the staff surrounding him. In the administration’s tumultuous early days, the nationalist faction led by Bannon and Stephen Miller routinely bypassed the agency process to enact such measures as the travel ban on visitors from seven Muslim-majority countries, reflecting Trump’s stance on immigration. When this ad hoc approach failed to yield satisfying results, Bannon and his crew were ushered out, and the nature of how the White House functioned changed.