Is U.S. fast losing its financial and technological edge under Trump’s second tenure?

By Dr. Manoj Kumar Mishra* 

The United States, along with its Western European allies, once promoted globalization as a democratic force that would deliver shared prosperity and balanced growth. That promise has unraveled. Globalization, instead of building an even world, has produced one defined by inequality, asymmetry of power, and new vulnerabilities. For decades, Washington successfully turned this system to its advantage. Today, however, under Trump’s second administration, America is attempting to exploit the weaknesses of others without acknowledging how exposed it has become itself.

The global economy has long been structured around American infrastructure—technological platforms such as the Internet, e-commerce, and social media that shaped communication systems worldwide. The U.S. dollar remains the dominant currency of trade and finance, with the SWIFT network positioning America at the center of global banking. Intellectual property regimes ensured American technological dominance, while U.S.-controlled telecommunications and Internet services doubled as surveillance tools. These structures were so centralized that Washington could weaponize them—first against terrorist organizations after 9/11, then against states such as Russia and China. Under Trump 2.0, even allies and partners are finding themselves targets of these coercive instruments.

But the era when the United States could unilaterally dictate terms through chokepoints in finance, technology, and information flows is fading. Cyberattacks by Russia, China, and Iran have exposed vulnerabilities in American infrastructure. Years of sanctions against Iran have not halted its nuclear ambitions; even U.S. support for Israel’s military pressure has failed to alter Tehran’s trajectory. Similarly, despite Trump’s repeated claims of seeking peace in Ukraine, Moscow has not shifted course. Sanctions that once bent adversaries now increasingly fall flat.

The End of Unilateral Leverage

For decades, U.S. power rested on its privileged position atop the global hierarchy of finance, production, and communications. Now, Trump’s confrontational policies are forcing rival powers to forge alternatives. Edward Snowden’s 2013 revelations about U.S. surveillance had already alerted major states to the risks of dependence on American systems. What was once a perception of U.S. decline is now turning into reality: fragmented financial, technological, and communication ecosystems are emerging, with Washington gradually losing leverage.

As technology fuses economics and national security, other powers view decoupling from U.S. supply chains as an imperative. Washington’s weaponization of trade and technology—such as restricting access to advanced semiconductors—has triggered countermeasures. China, for instance, has used its grip over rare earth minerals to push back, exposing America’s reliance on strategic resources it cannot easily substitute. European industries, including German carmakers, have felt Beijing’s leverage as well, revealing how U.S. attempts to isolate China often leave its allies cornered.

China has also drawn lessons from the first Trump administration. When Washington threatened to cut off ZTE and imposed controls on Huawei, Beijing accelerated efforts to build its own technological ecosystem. Today, it is carving out independent supply chains, consolidating control over communications systems, and gathering strategic intelligence on other states’ vulnerabilities. The net effect: China is turning America’s own playbook of economic coercion into leverage against Washington.

Eroding U.S. Institutions

Ironically, the Trump administration’s second term is undermining the very institutions that once enabled U.S. global dominance. Funding cuts and staff reductions at critical agencies such as the Office of Foreign Assets Control (OFAC)—the arm of the Treasury Department that enforces sanctions—have left America’s sanctions regime hollow. The Office of Terrorism and Financial Intelligence, which oversees OFAC, has seen key vacancies remain unfilled. Even the National Security Council, which coordinates U.S. security strategy, has been downsized by more than half. Trump has sidelined interagency processes in favor of personalized decision-making, leaving American policy less coordinated and less effective.

The consequences are clear: the tools that once gave Washington unrivaled control are blunted. At the same time, America’s adversaries and competitors are developing alternative systems to reduce their exposure to U.S. coercion. The longer this trajectory continues, the more likely it is that the United States will find itself no longer the architect of globalization, but one of its casualties.

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*Lecturer in Political Science, S.V.M. Autonomous College, Jagatsinghpur, Odisha