Trump’s Biggest Deal That Never Happened: The Nobel Peace Prize

I am the center of the universe

By J. André Faust | The Connected Mind | October 11, 2025

Why Donald Trump Did Not Receive the Nobel Peace Prize

There are two prevailing schools of thought on why President Donald Trump should or should not have received the Nobel Peace Prize.

In my opinion, there are many reasons why he didn't receive the Nobel Peace Prize. The first point is that by repeatedly claiming he deserves the Nobel Peace Prize, Donald Trump has effectively politicized the award. The Nobel Prize is not a prize that one can demand that they deserve or should be nominated for. By politicizing the award, he may have biased the committee in the sense that they feel manipulated, and awarding him that award may make them feel that they are complying with his “I deserve the Nobel Prize” campaign (BBC News, 2020).

As an observer, it appears that Donald Trump creates crises so that later he can claim that he alone resolved the problems he created.

Throughout his political career, Donald Trump has shown a recurring pattern of amplifying or even manufacturing crises, only to later claim credit for resolving them. This approach creates the illusion of decisive leadership while concealing the fact that the instability often originated from his own actions (Reuters, 2020; Washington Post, 2024).

A clear example is the North Korea nuclear crisis. Early in his first term, Trump's confrontational rhetoric — “fire and fury like the world has never seen” — brought the region to the brink of open conflict. Months later, when tensions subsided and diplomatic talks began, he presented the outcome as a personal triumph, claiming to have “stopped a war.” Yet North Korea's nuclear arsenal remained intact, and experts noted no verifiable disarmament (AP News, 2019; PBS NewsHour, 2019).

A similar pattern emerged in trade policy. Trump's imposition of sweeping tariffs on allies and rivals alike triggered retaliatory measures that harmed global markets and U.S. consumers. When partial deals were later struck — often restoring conditions that had existed before the tariffs — he framed them as “historic victories.” In effect, the damage and the “solution” were two parts of the same political performance (Financial Times, 2019; CNBC, 2020).

The same strategy can be seen in the Middle East. U.S. withdrawal from the Iran nuclear agreement reignited regional instability, while unconditional support for Israel's military actions deepened the Gaza crisis. When Trump later proposed his 20-point “peace plan,” he positioned himself as the architect of resolution — despite having helped enable the escalation that made such a plan necessary in the first place (PBS NewsHour, 2025; Al Jazeera, 2025).

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The same pattern of manufactured crisis and self-justification is also evident within the United States. Domestically, Donald Trump's approach has increasingly centred on punitive politics — the pursuit of personal retribution against perceived opponents. Rather than fostering unity, his rhetoric and actions have deepened existing divisions, transforming political disagreement into moral hostility (New York Times, 2025).

Recent indictments and investigations targeting prominent Democrats have been presented by Trump and his allies as necessary acts of “justice,” yet to many observers they resemble political vengeance more than impartial law enforcement. When leaders use the instruments of the state to punish rivals, the effect is not restoration but corrosion — it weakens trust in democratic institutions and fuels the very instability that such actions claim to resolve (Guardian, 2025).

This domestic polarisation mirrors his foreign conduct: crises are created or magnified, and then authority is asserted as the sole path to order. The pattern sustains a cycle in which conflict becomes both the justification for power and the proof of its necessity. In this way, Trump's brand of leadership depends on division; peace, whether at home or abroad, is valuable only insofar as it can be personally credited to him.

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Lastly, his 20 points, which were originally interpreted as an ultimatum — if all 20 points were not agreed to by Hamas, the Islamic Resistance Movement — implied that the consequences would be significant (PBS, 2025).

The problem with the entire 20 points is the complexity involved, and there are infinite ways players can respond. Therefore, accurately predicting the final outcome is based on what the probable outcome should be. This dynamic reflects the unpredictability described in game theory, where every player acts under uncertainty and strategic manipulation can destabilise any path to peace (Nash, 1950).

Donald Trump operates within a self-constructed paradox: he appears unpredictable, yet his unpredictability functions as strategy. To adversaries and observers alike, it can be difficult to distinguish whether he is an impulsive provocateur or a deliberate manipulator of perception. In either case, he has cultivated an image of absolute control — a political chess master who positions every piece, domestic and foreign, to ensure victory on his own terms. His willingness to employ distortion and false narratives — from linking Canadian trade to fentanyl trafficking, to claiming that immigrants are “eating dogs” — demonstrates a pattern of manufacturing emotional responses that reinforce his dominance within the public arena (Politico, 2025; CBC News, 2025).

From a game-theoretical perspective, this behaviour reflects a form of information warfare in which truth itself becomes a negotiable asset. By flooding the board with misinformation, he destabilises his opponents’ capacity for rational response. The objective is not persuasion but confusion — to make the opponent’s next move uncertain while his own appears decisive. This is the political equivalent of asymmetric play, where the perceived “madman” advantage keeps adversaries reactive, unable to coordinate effectively against him (Von Neumann & Morgenstern, 1944).

In the end, the Nobel Peace Prize is not awarded for dominance, negotiation, or spectacle. It recognises those who elevate humanity beyond division — individuals who pursue peace not as leverage, but as conviction. Donald Trump’s pattern of manufacturing crises, weaponising disinformation, and treating diplomacy as a contest of ego stands in direct contrast to that moral foundation.

And then he and his supporters wonder why he didn’t receive the Nobel Peace Prize.

About the author

J.  André Faust examines the structural entanglements of politics, economics and society. He explores how single moments, from a lone act of violence to a policy choice, can unfold into decades of social and cultural change.

His approach treats reality like a layered 3D model. Systems overlap, interact and sometimes obscure one another. Forecasts are provisional; hidden layers and feedback loops are often still at work.

Guiding idea: understand connections, trace feedback and revise beliefs as new layers come into view.

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References

• Al Jazeera. (2025). Trump’s 20-point Gaza peace plan: full text.
• AP News. (2019). Trump claims success in talks with North Korea despite lack of progress.
• BBC News. (2020). Trump says he deserves the Nobel Peace Prize but will never get it.
• CBC News. (2025). Trump’s remarks about Canadian fentanyl and immigrant “dog-eating” claims draw criticism.
• CNBC. (2020). Trump’s tariffs hurt American consumers, economists say.
• Financial Times. (2019). U.S.-China trade war: the real costs of Trump’s tariffs.
• Guardian. (2025). Trump’s use of indictments against Democrats raises fears of political retribution.
• Nash, J. (1950). Equilibrium points in n-person games. Proceedings of the National Academy of Sciences, 36(1), 48–49.
• PBS NewsHour. (2019). Trump’s meeting with Kim Jong-un: what did it achieve?
• PBS NewsHour. (2025). Trump’s 20-point proposal to end the Gaza war.
• Politico. (2025). Trump stokes outrage with false claims about immigrants and fentanyl.
• Reuters. (2020). Trump’s manufactured crises and self-claimed victories: a pattern of governance.
• Von Neumann, J., & Morgenstern, O. (1944). Theory of Games and Economic Behavior. Princeton University Press.
• Washington Post. (2024). Trump’s politics of chaos: creating disorder to claim control.
• New York Times. (2025). Trump’s domestic strategy: divide and dominate.

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The Unfinished Pursuit of Peace

Trump and the Nobel Peace Prize: A Game Still in Play

About the Nobel Prizes

In his will, Alfred Nobel directed that his fortune support annual prizes in Physics, Chemistry, Physiology or Medicine, Literature and Peace, awarded to those who have conferred the greatest benefit on humankind (NobelPrize.org).

The framework later expanded to include the Prize in Economic Sciences in memory of Alfred Nobel, funded by Sweden’s central bank and awarded alongside the original categories (NobelPrize.org).

Although the Peace Prize recognises direct efforts to prevent or resolve conflict, many laureates in Economic Sciences have shaped how we understand cooperation and competition. John Nash’s equilibrium concept, for example, influences diplomacy and conflict modelling (NobelPrize.org; Britannica).

In short, the Nobel constellation links scientific discovery, literature, economics and peace. The common thread is measurable contribution to humanity’s capacity to coexist.

Image: Alfred Nobel, public domain via Wikimedia Commons.

It is through this wider lens that we can now examine Donald Trump’s pursuit of the Nobel Peace Prize.

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By J. André Faust | The Connected Mind | October 10, 2025

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It is possible that the Nobel Peace Prize Committee has looked beyond the surface in deciding not to award Donald Trump the prize, at least not yet (NobelPrize.org, nomination process).

The Gaza crisis is still unfolding. While an initial phase regarding the return of hostages and prisoners appears to have been achieved (BBC News, Middle East analysis), many key questions remain unresolved.

Reports confirm that the exchange of hostages and prisoners has taken place, but accounts remain conflicting over whether Israel has fully halted its bombing campaign. Some international outlets cite continued strikes in limited areas, while others report a complete pause pending verification by neutral observers. This lack of consistency highlights how fragile the ceasefire remains and why global monitoring is essential to confirm whether the violence has truly stopped. For further details on these conflicting reports, see the verification note below.

Has Israel fully stopped its bombing campaign (Reuters, Middle East updates)?
What happens with Israeli settlements and disputed lands (UN Peacebuilding)?
Who will govern Gaza, and how will reconstruction be designed and funded (Al Jazeera, Gaza coverage)?

These are not small details; they are the structural issues on which any lasting peace depends.

Beyond the Middle East, the committee may also weigh Trump’s domestic record, including immigration policy proposals (CNN Politics overview), the use of the National Guard in domestic contexts (NBC News reporting), and the alignment of such actions with broader human-rights norms (Human Rights Watch).

It is not that I am anti-Trump. In some areas, he takes a step forward. In others, it can feel like three steps back (Pew Research Center, public opinion).

It is possible that, at a later stage, if outcomes prove durable and balanced, he could still receive the recognition he seeks. But so far, Trump may be unusual for openly seeking the prize rather than allowing outcomes to speak for themselves (The Guardian, 2020).

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Context and Analysis

Further insight into recent developments comes from John Lyons of ABC News (2025), who credits President Trump with using his office to force a ceasefire between Israel and Hamas, leading to the release of hostages and the suspension of Israel’s bombing campaign.

Lyons writes that Trump “may have closed the latest — and most violent — chapter in the Israeli-Palestinian conflict,” yet his claim to have “brought peace to the Middle East” is exaggerated. The ceasefire, while significant, leaves unresolved the devastation of Gaza, Hamas’s ideological persistence and Israel’s settlement expansion.

The report notes that Trump’s plan succeeded in halting immediate bloodshed, but the broader political structure remains unchanged. Lyons observes that both Hamas and Israel’s Netanyahu government oppose a two-state solution — the framework that over 150 countries, including Australia, have endorsed through UN recognition of a Palestinian state.

From this perspective, Trump’s achievement is a necessary pause rather than a lasting peace. The humanitarian toll may have been halted, but without addressing sovereignty, statehood and occupation, the deeper conflict remains unresolved.

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For most laureates, the Nobel Prize is not something they pursue; it is the consequence of sustained efforts that improve the human condition (NobelPrize.org, Peace Prize).

About the author

J.  André Faust examines the structural entanglements of politics, economics and society. He explores how single moments, from a lone act of violence to a policy choice, can unfold into decades of social and cultural change.

His approach treats reality like a layered 3D model. Systems overlap, interact and sometimes obscure one another. Forecasts are provisional; hidden layers and feedback loops are often still at work.

Guiding idea: understand connections, trace feedback and revise beliefs as new layers come into view.

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True peace is not declared; it is demonstrated.

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Verification Note

Conflicting reports have emerged regarding whether Israel has completely halted its bombing operations following the hostage–prisoner exchange. Reuters and BBC cite intermittent strikes in northern Gaza, while Al Jazeera and Associated Press describe a broader pause aligned with Trump’s ceasefire terms. As of this writing, verification from neutral observers such as the UN Office for the Coordination of Humanitarian Affairs (OCHA) has not yet confirmed a full cessation of hostilities.

This summary reflects available reporting as of October 11 2025 and may be updated as corroborating evidence becomes available.

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References

1. “Alfred Nobel’s Will,” NobelPrize.org. link
2. “The Prize in Economic Sciences,” NobelPrize.org. link
3. “John F. Nash Jr. – Facts,” NobelPrize.org. link
4. “Nash equilibrium,” Britannica. link
5. “Nomination and Selection of the Peace Prize Laureates,” NobelPrize.org. link
6. “Middle East – latest,” BBC News. link
7. “Middle East news,” Reuters. link
8. “UN Peacebuilding,” United Nations. link
9. “Middle East updates,” Al Jazeera. link
10. “Trump immigration policy overview,” CNN Politics. link
11. “National Guard usage reports,” NBC News. link
12. Human Rights Watch – Reports. link
13. Pew Research Center – U.S. Politics. link
14. “Trump’s Nobel Prize nominations and claims,” The Guardian, 2020. link
15. “Nobel Peace Prize – about and laureates,” NobelPrize.org. link
16. Lyons, John. “Donald Trump deserves credit for stopping the war on Gaza, but his key claim is overblown.” ABC News (Australia), October 11, 2025. link

The Integration Trap: How Global Economics Locked Us Into Climate Collapse

By J. André Faust (Sept 06, 2025)

1. The Personal Paradox

Most of us are trapped in a contradiction. To survive, we must earn money. To earn money, we must participate in an economy that accelerates the destruction of the environment that keeps us alive. I see this contradiction every day. If I stopped working to focus full time on writing and producing the kind of intellectual content that could help others see the big picture, I could not pay for food, shelter, or electricity.

Every paycheck, every purchase, every click on a digital ad connects me to the same global web that is heating the oceans, thinning the ice caps, and releasing ancient gases from the permafrost. It is not hypocrisy; it is structure. The system demands participation. Refusal comes at the cost of survival.

2. Geoeconomics: Power in the Age of Interdependence

We often talk about the global economy as though it were a neutral machine. In truth, it is a geopolitical battlefield disguised as a marketplace. Nations use trade, energy, and technology to pursue power under the banner of prosperity.

Each country competes for advantage: cheaper labor, cheaper energy, looser environmental laws. Every ton of carbon burned to sustain that competition becomes another contribution to the planetary debt. Even when governments promise cooperation, the incentives push toward self-interest. The result is a global race where everyone speeds up while pretending to brake.

3. Climate Feedback: The Planet Mirrors the Market

The Earth’s climate behaves much like the global market; it amplifies what it receives. When emissions rise, warming accelerates. When ice melts, reflectivity drops and more heat is absorbed. When permafrost thaws, methane escapes, trapping even more heat.

Economics follows the same feedback logic. When profits rise, investment accelerates. When consumption expands, industries grow. When debt fuels spending, growth becomes mandatory just to keep balance sheets alive. Both systems are self-reinforcing loops, and both now run beyond the point where simple adjustments can restore equilibrium. The climate is not our opponent; it is our mirror.

4. Complexity at Diminishing Returns

Anthropologist Joseph Tainter described how civilizations collapse when the costs of complexity exceed the benefits. In modern terms, our complexity is the global economic machine itself: supply chains, data networks, financial derivatives, multinational regulations. Every time we add a new layer to solve a problem, we create new vulnerabilities that require still more layers to manage.

Each summit, each climate accord, each innovation adds more structure without reducing the total stress on the planet. The energy required to maintain this complexity—both literal and political—keeps rising. The returns keep shrinking. Collapse, in Tainter’s sense, is not moral failure. It is an energy imbalance that can no longer be paid for.

5. The Lost Capacity for Collective Action

For any hope of reversal, the world would need unified effort: shared technology, synchronized energy transitions, and transparent resource management. But the geopolitical environment rewards fragmentation, not cooperation.

Tariffs on green technologies, competition over critical minerals, and rival energy blocs reflect a deeper truth: the system’s self-preservation instinct now overrides the planet’s. The same logic that drives corporations to maximize quarterly profits drives nations to prioritize GDP over stability. When cooperation becomes politically impossible, the window for reversal closes. The tipping point is no longer just environmental; it is institutional. The global economy has become too self-interested to save itself.

6. The Human Dilemma

Here is where it turns personal again. Knowing all this does not free me from it. Like billions of others, I am bound to a currency system that values growth more than life. Even the act of writing about collapse depends on electricity, servers, and manufactured devices—processes sustained by the very machinery I critique.

This is the emotional cost of awareness: understanding that every solution still draws from the same finite pool of energy and materials. There is no clean exit, only degrees of participation.

7. What Remains Possible

Perhaps the goal is not salvation but clarity. We can still choose honesty over illusion, cooperation over denial, and resilience over blind optimism. Local economies, cultural memory, and intellectual integrity become forms of resistance when global systems refuse correction.

We may not stop the collapse, but we can shape how consciously we experience it. Every act of truth-telling slows the descent a little and preserves knowledge for whatever comes next.

8. Closing Reflection

Civilizations do not fall because people stop caring. They fall when caring is no longer profitable. The integration that once made us powerful now binds us to the consequences of our own design. The global economy, the climate system, and human survival have merged into a single equation whose solution we can no longer balance.

We are living within that equation—each of us an input, each of us a signal echoing through the system we built. Understanding that is not despair; it is the beginning of wisdom.

9. What Game Theory Has to Say

From a game-theory perspective, the climate crisis behaves like a global Prisoner’s Dilemma. Each nation knows that cooperation—cutting emissions, sharing technology, and limiting extraction—would benefit everyone in the long run. Yet the fear of losing competitive advantage makes defection the safer short-term choice. The result is a rational race toward collective ruin.

In game-theory terms, the global economy is locked in a non-cooperative equilibrium where each player pursues individual gain, even while knowing that mutual restraint would yield a higher collective payoff. The system rewards exploitation over preservation, competition over trust, and growth over equilibrium.

Economists and political theorists call this a coordination failure, but in deeper terms it reveals a civilization unable to rewrite its own rules. Collapse, therefore, is not only a physical or economic event; it is the logical outcome of the strategies that once made us successful. The tragedy is not that humanity is irrational, but that our rationality now serves the wrong game.

For readers interested in cooperative strategies and the mathematics of coordination, classic works in game theory explore how trust, reciprocity, and reputation can stabilize systems that would otherwise self-destruct. These ideas will be central to any future rethinking of global governance.

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References

Tainter, J. A. (1988). The Collapse of Complex Societies. Cambridge University Press.

Intergovernmental Panel on Climate Change. (2023). Climate Change 2023: Synthesis Report of the IPCC Sixth Assessment Report (AR6). IPCC. https://www.ipcc.ch/report/ar6/syr/

Meadows, D. H., Meadows, D. L., Randers, J., & Behrens, W. W. (1972). The Limits to Growth. Universe Books.

Smil, V. (2017). Energy and Civilization: A History. MIT Press.

Jackson, T. (2017). Prosperity Without Growth: Foundations for the Economy of Tomorrow. Routledge.

Axelrod, R. (1984). The Evolution of Cooperation. Basic Books.

Schelling, T. C. (1960). The Strategy of Conflict. Harvard University Press.

Ostrom, E. (1990). Governing the Commons: The Evolution of Institutions for Collective Action. Cambridge University Press.

About the author

J. André Faust examines the structural entanglements of politics, economics, and society. He explores how single moments, from a lone act of violence to a policy choice, can unfold into decades of social and cultural change.

His approach treats reality like a layered 3D model. Systems overlap, interact, and sometimes obscure one another. Forecasts are therefore provisional. When outcomes are hard to predict, it is often because hidden layers and feedback loops are still at work.

Guiding idea: understand connections, trace feedback, and revise beliefs as new layers come into view.

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Testing the Gospel Ethic in Israel and Palestine

Where the Jesus ethic meets the daily reality of Israel and Palestine

By J. André Faust (Oct 04, 2025)

The Motif

The figure of Jesus is a moral North Star: peace, mercy, forgiveness, love of enemy, care for the vulnerable. The Sermon on the Mount, the call to peacemakers, the command to love those who hate you, and the preference for humility over status set a clear ethic. It is an ethic of means, not only ends, and it measures success by the dignity preserved in those who suffer.

Where the Contradiction Appears

Modern states operate inside a hard world of borders, deterrence, and survival. Leaders are rewarded for security outcomes, not for moral beauty. The result is a visible gap between the motif and the methods often used in its name. This gap is not new. It is a repeating pattern: an ideal rises, power consolidates around it, power drifts toward self-preservation, then renewal is needed to realign means with the original purpose.

The Dialectic: How Ideals Drift

1. Ideal: a unifying moral vision invites sacrifice and trust.
2. Power: institutions stabilize the vision and guard the community.
3. Corruption: incentives tilt toward control, secrecy, and punishment.
4. Renewal: voices of conscience expose the drift and call the system back.

Mechanics of the Contradiction

• Security dilemma: one side’s “defense” looks like “aggression” to the other, so each escalation invites the next.
• Trauma memory: communities with deep wounds overweight worst-case risks and accept harsher measures as “insurance.”
• Bureaucratic survival: agencies protect budgets, reputations, and doctrines, even when conditions change.
• Signaling politics: leaders prove strength to domestic audiences, which narrows room for de-escalation.
• Moral licensing: doing some good becomes a pass for doing harm “for the greater good.”
• Media incentives: outrage and spectacle reward maximal responses and punish restraint.
• Path dependence: once you invest in a tool, you keep using it, even when it is no longer the right tool.

Practical Tests: Are We Close to the Motif?

• Means vs ends: are the means humane, or only the goal?
• Enemy image: do we leave space for the opponent’s repentance, or only for their defeat?
• Proportionality: are responses limited, precise, and revisable?
• Protection of the vulnerable: are noncombatants, prisoners, and the poor actively shielded?
• Transparency: can citizens audit the policy, the data, and the costs?
• Burden sharing: do decision makers share the costs, or export them downward?
• Room for dissent: are critics treated as partners in truth-seeking, or as enemies?

What Renewal Looks Like

Renewal begins when conscience regains jurisdiction over strategy. In practice that means verifiable de-escalation steps, humanitarian corridors with third-party monitors, time-limited emergency powers, protection of journalists and medics, restorative elements for the innocent, and language that recognizes the other’s dignity. None of this guarantees safety, yet each step closes the gap between the motif and the method.

Why This Matters

The point is not to romanticize power or to shame those who exercise it. The point is to keep power answerable to the very ideal that gave it birth. Every era repeats the same spiral. The question is whether we notice the drift early enough to correct it without catastrophe.

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References (APA 7)

1. Allison, G. T., & Zelikow, P. (1999). Essence of decision: Explaining the Cuban missile crisis (2nd ed.). Longman.
2. Buber, M. (1970). I and Thou (W. Kaufmann, Trans.). Charles Scribner’s Sons. (Original work published 1923)
3. Cohen, S. J. D. (1999). The beginnings of Jewishness: Boundaries, varieties, uncertainties. University of California Press.
4. Goodman, M. (2007). Rome and Jerusalem: The clash of ancient civilizations. Penguin.
5. Heschel, A. J. (1955). God in search of man: A philosophy of Judaism. Farrar, Straus and Giroux.
6. Herman, E. S., & Chomsky, N. (1988). Manufacturing consent: The political economy of the mass media. Pantheon.
7. Jervis, R. (1978). Cooperation under the security dilemma. World Politics, 30(2), 167–214.
8. Merritt, A. C., Effron, D. A., & Monin, B. (2010). Moral self-licensing: When being good frees us to be bad. Social and Personality Psychology Compass, 4(5), 344–357.
9. Nash, J. (1950). Equilibrium points in n-person games. Proceedings of the National Academy of Sciences, 36(1), 48–49.
10. Pierson, P. (2000). Increasing returns, path dependence, and the study of politics. American Political Science Review, 94(2), 251–267.
11. Schäfer, P. (Ed.). (2003). The Bar Kokhba War reconsidered: New perspectives on the second Jewish revolt against Rome. Mohr Siebeck.
12. Schelling, T. C. (1966). Arms and influence. Yale University Press.
13. Smallwood, E. M. (1976). The Jews under Roman rule: From Pompey to Diocletian. Brill.
14. The Holy Bible, New Revised Standard Version. (1989). National Council of Churches. (Citations used: Matthew 5:9; Luke 6:27; Matthew 5:39; John 18:36)
15. Yoder, J. H. (1994). The politics of Jesus (2nd ed.). Eerdmans.
16. Sacks, J. (2002). The dignity of difference: How to avoid the clash of civilizations. Continuum.

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Correlation or Coincidence? Carney’s Premiership and Canada’s Market Boom

 

Markets, Monetary Policy, and Mark Carney: Why the TSX Surged in 2025

Correlation, context, and the Bank of Canada’s role

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Mark Carney, the Bank of Canada, and the TSX rally — visual theme

Since Mark Carney became Prime Minister on March 14, 2025, the S&P/TSX Composite Index has risen strongly. At first glance, this looks like a story of political leadership. But the market’s movement reflects a deeper interplay of fiscal signals, monetary policy, global equity trends, and Canada’s commodity cycle.

What the numbers say

• TSX March 2025 close: ~24,917
• TSX October 1, 2025: ~30,108
• Price return: about +20.9% in just over six months
• Total return: likely closer to +23–25% once dividends are included

The Bank of Canada factor

Monetary policy has been central. In March, the BoC rate stood at 3.00%. By Sept 17, 2025, it was lowered to 2.50%. These cuts reduced borrowing costs, buoyed corporate expansion, and supported exporters via a softer Canadian dollar.

TSX climbing while the BoC eases: March–October 2025 (blue = TSX, red = BoC rate)

Global alignment

• U.S. equities also gained through 2025, reflecting a wider risk-on environment.
• Canada’s resource-heavy index benefited from strong oil and metals.
• The TSX remains highly correlated with global markets, amplifying moves.

So, is there a “Carney effect”?

There is a positive correlation between Carney’s first months in office and the TSX’s rally. But causation is harder to prove. A balanced assessment is that Carney’s credibility bolstered confidence, while monetary policy and global conditions did the heavy lifting.

Why this matters

Markets and politics interact through expectations. A strong index gives Carney political capital, but sustaining momentum will depend on factors beyond Ottawa — commodity prices, U.S. markets, and future Bank of Canada moves.

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Sources and notes

• Bank of Canada interest rate announcement, Sept 17, 2025.
• TMX monthly stats for March 2025 — closing reference.
• TradingEconomics and Investing.com — current TSX levels.

Trump’s 90-Day Tariff Pause: Strategic Masterstroke or Calculated Bluff?

World domination: Countries will dance to my tune

 By J. André Faust (April 10, 2025)

Trump’s recent 90-day pause on most retaliatory tariffs isn't random—it’s a calculated maneuver in a multi-player strategic game.

In game theory terms, this looks like a deliberate pivot within a sequential game. Faced with simultaneous signals from over 75 countries, Trump appears to have shifted to a pause-and-observe strategy, maintaining flexibility while testing the responses of other players.

He didn’t pause everything. Tariffs on Chinese imports were hiked to 125%, which looks like asymmetric signaling—rewarding cooperative states with relief, while punishing non-compliance with intensified pressure. The outcome? A 9.5% surge in the S&P 500, one of the strongest market rebounds since WWII. If that’s not anticipation of payoff, I don’t know what is.

To me, it seems likely that Trump had already mapped out potential player responses, including how financial markets would react. This is not improvisation; it’s the behavior of a player operating several moves ahead, likely within a zero-sum frame, where one player's gain is another’s loss.

His reference to Mark Carney as the “Prime Minister of Canada” instead of “Governor” wasn’t a gaffe. In strategic communications, that’s a public signal meant to undermine Pierre Poilievre while elevating a preferred alternative. If we interpret this as a soft annexation narrative, it fits within a framing tactic: shifting perceived legitimacy from one actor to another.

Poilievre’s electoral strategy, on the other hand, has been highly predictable. He’s adapted rhetoric, not strategy. In the context of a repeated game, voters eventually see through surface-level repositioning when no deeper change occurs.

Now, what’s the biggest threat to Trump’s strategy? Coalition formation. If all 75 countries moved in unison against him, the payoff matrix would shift dramatically. But the global interdependence of economies makes such unity improbable—too many players have something to lose in a full-scale standoff.

Trump’s Tariff Pause: A Game Theory Perspective

Trump’s recent 90-day pause on most retaliatory tariffs isn't random—it’s a calculated maneuver in a multi-player strategic game.

In game theory terms, this looks like a deliberate pivot within a sequential game. Faced with simultaneous signals from over 75 countries, Trump appears to have shifted to a pause-and-observe strategy, maintaining flexibility while testing the responses of other players.

He didn’t pause everything. Tariffs on Chinese imports were hiked to 125%, which looks like asymmetric signaling—rewarding cooperative states with relief, while punishing non-compliance with intensified pressure. The outcome? A 9.5% surge in the S&P 500, one of the strongest market rebounds since WWII. If that’s not anticipation of payoff, I don’t know what is.

To me, it seems likely that Trump had already mapped out potential player responses, including how financial markets would react. This is not improvisation; it’s the behavior of a player operating several moves ahead, likely within a zero-sum frame, where one player's gain is another’s loss.

Here's a brief explanation of the payoff matrix: The assigned values mean that the higher the number, the better the outcome, and the lower the number, the worse the outcome.

• (Pause Tariffs, Cooperate) = (3, 3): Mutually beneficial outcome. Trump gets economic relief and positive optics, countries avoid economic retaliation.

• (Pause Tariffs, Retaliate) = (1, 2): Trump shows flexibility but gets undercut; countries benefit slightly from autonomy but at a minor economic cost.

• (Enforce Tariffs, Cooperate) = (4, 1): Trump gains dominance and appears strong; countries yield but suffer economically.

• (Enforce Tariffs, Retaliate) = (0, 0): Worst-case scenario. Trade war escalates, and both sides suffer
• If all 75 countries moved in unison against him, the payoff matrix would shift dramatically. But the global interdependence of economies makes such unity improbable—too many players have something to lose in a full-scale standoff.

Bottom line: this move isn't just about tariffs. It’s about shifting perception, testing loyalty, and managing risk while positioning for longer-term gains. The game is very much in motion—and Trump, for now, is dictating the tempo.

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The Tariff Standoff: Who Will Blink First in the U.S.– China Showdown?

By J. André Faust (April 08, 2025)

Asymmetric War of Attrition: US vs. China Trade War

Understanding the Game of Attrition

In game theory, a "war of attrition" is when two players compete not by direct confrontation, but by waiting each other out. Think of it like a staring contest—each side pays a cost for staying in, and the last one to quit takes the prize. It’s used to explain animal behavior, business strategy, and politics. In this case, we're applying it to the US-China trade war, where both nations are enduring economic strain hoping the other backs down first.

With Trump recently slapping a 104% tariff on Chinese EVs, the game has clearly entered a new phase. The stakes are high, and so are the risks. But is there really a winner in a game where the longer you stay, the less there is to win?

Fig. 1 – Asymmetric War of Attrition: US vs. China Trade War

This graph is generated from the Python code below and illustrates how both countries approach the trade war with different cost structures and reward decay rates:

import matplotlib.pyplot as plt
import numpy as np

# Simulation parameters
rounds = 20
initial_reward_us = 100
initial_reward_china = 100
reward_decay_us = 3
reward_decay_china = 2
cost_per_round_us = 4
cost_per_round_china = 2

# Arrays for plotting
x = np.arange(1, rounds + 1)
reward_us = np.maximum(initial_reward_us - reward_decay_us * (x - 1), 0)
reward_china = np.maximum(initial_reward_china - reward_decay_china * (x - 1), 0)
cumulative_cost_us = cost_per_round_us * x
cumulative_cost_china = cost_per_round_china * x
net_gain_us_if_china_concedes = reward_us - cumulative_cost_us
net_gain_china_if_us_concedes = reward_china - cumulative_cost_china

# Plotting
plt.figure(figsize=(12, 7))
plt.plot(x, reward_us, label='US: Remaining Reward ($)', linewidth=2)
plt.plot(x, reward_china, label='China: Remaining Reward ($)', linewidth=2)
plt.plot(x, cumulative_cost_us, label='US: Cumulative Cost ($)', linestyle='--', linewidth=2)
plt.plot(x, cumulative_cost_china, label='China: Cumulative Cost ($)', linestyle='--', linewidth=2)
plt.plot(x, net_gain_us_if_china_concedes, label='US: Net Gain if China Concedes ($)', linestyle=':', linewidth=2)
plt.plot(x, net_gain_china_if_us_concedes, label='China: Net Gain if US Concedes ($)', linestyle=':', linewidth=2)

plt.xlabel('Rounds of Trade War')
plt.ylabel('USD Value')
plt.title('Fig 1. Asymmetric War of Attrition: US vs. China Trade War')
plt.legend()
plt.grid(True)
plt.tight_layout()
plt.show()

Explanation: This figure shows how each side bears costs over time and how the potential reward they’re fighting for diminishes. The U.S. burns through more money per round, with rewards decaying faster, while China maintains a slower cost burn and a more gradual reward loss. This imbalance makes it an asymmetric war—each side is playing with different tools and different pain thresholds.

Fig. 2 – War of Attrition with Shrinking Reward

This second graph, generated by the code below, takes it a step further by showing what happens when the total reward shrinks over time—not just because of internal costs, but because of external factors like global economic downturns:

import matplotlib.pyplot as plt
import numpy as np

# Time axis
time = np.linspace(0, 10, 100)

# Reward decay function (e.g., exponential decay)
initial_reward = 10  # Starting reward value
decay_rate = 0.3
reward = initial_reward * np.exp(-decay_rate * time)

# Plotting
plt.figure(figsize=(10, 6))
plt.plot(time, reward, label="Shrinking Reward Over Time", linewidth=2)

# Labels and Title
plt.title("Fig 2. War of Attrition with Shrinking Reward", fontsize=14)
plt.xlabel("Time (Rounds of Trade War)", fontsize=12)
plt.ylabel("Reward Value (Billion $)", fontsize=12)
plt.grid(True)
plt.legend()
plt.tight_layout()
plt.show()

Explanation: Fig. 2 captures a bigger problem: what if the prize you’re fighting for is evaporating? Even if a country “wins” by outlasting its opponent, the final reward might be a fraction of what it once was. Global recessions, shifts in alliances, inflation—these can all chip away at the prize until there’s nothing left worth fighting for.

Closing Thoughts

Looking at Fig. 1, we see the broader picture: an asymmetric war of attrition between the U.S. and China. The U.S. enters the game with higher costs per round and a steeper reward decay, while China plays a more patient, lower-cost game. Each round that goes by chips away at the potential payoff. If either side drops out early, the other could win big—but if they both hold out too long, the prize may not be worth the fight.

Then there’s Fig. 2, where the game gets even trickier. Here, the reward itself shrinks over time, not just because of cost but due to external economic pressure—like global market contractions or public fatigue. It’s a warning: sometimes, there’s no glory in winning if the reward has already vanished.

Trump’s latest move—slapping a 104% tariff on Chinese EVs—might look tough on the surface. But from a game theory lens, it’s a signal. He’s testing China’s resolve, daring them to respond, all while trying to frame the narrative on his terms. The question isn’t just who wins—it’s when they decide the game isn’t worth playing anymore.

That’s the heart of a war of attrition. It’s not about who throws the biggest punch—it’s about who can outlast their opponent, and whether the prize is still worth it by the time someone gives in.

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Analysis of Liz Truss' Criticism of Mark Carney

Whatever happened to objective reporting?

From mainstream media, the challenge isn’t just accessing information but deciphering the political bias each outlet carries. Whether the bias leans left or right, the issue remains the same—they frame the narrative to support their ideological stance, often at the expense of an accurate representation of the facts.

Take, for example, The Toronto Sun’s interview with Liz Truss, former Conservative Prime Minister of the UK. In the interview, Truss exaggerates Mark Carney’s responsibility for Britain’s financial challenges, blaming him for policies that continued long after his departure from the Bank of England. While Carney’s tenure had lasting economic effects, the UK’s financial struggles are also the result of Brexit, Truss’s own failed economic policies, and broader global financial conditions.

As a conservative-leaning publication, The Toronto Sun amplifies Truss’s narrative, making the interview more of a political attack than a balanced economic analysis. This is not objective journalism.

The following is an analysis of The Toronto Sun’s interview with Liz Truss.

Key Claims & Their Validity

1. Carney’s Role in Quantitative Easing (QE) and Inflation

Claim: Carney oversaw excessive money printing (QE), which devalued the economy and caused high inflation.

Fact Check: Carney implemented QE in response to the 2008 financial crisis and Brexit instability. However, QE continued under his successors, including during COVID-19. Inflation in the UK rose sharply in 2021–2022, after Carney had already left office, due to supply chain disruptions, Brexit effects, and the Ukraine war.

Verdict: Partially misleading—Carney set the foundation for QE, but inflation was a multi-causal problem post-Carney.

2. Carney's Alleged Responsibility for Britain's Stagnation

Claim: Carney's leadership led to low economic growth, with UK GDP per capita stagnating compared to the US.

Fact Check: UK economic stagnation is more tied to Brexit and government policies than Carney’s central banking policies. The Bank of England is responsible for monetary policy, not economic policy, which is the government's job.

Verdict: Mostly inaccurate—Carney had influence, but stagnation is largely a result of Brexit and policy choices post-2016.

3. Carney’s Net Zero Policies & UK Energy Prices

Claim: Carney was a major proponent of Net Zero, which harmed the UK’s energy sector and led to record-high energy prices.

Fact Check: Carney promoted green finance, but energy price hikes were due to Brexit-induced supply chain disruptions, Russia’s invasion of Ukraine, and global oil market instability.

Verdict: Misleading—Carney promoted green finance, but energy price hikes were due to geopolitical and structural issues, not his policies.

4. Carney’s Influence on the 2022 UK Pension Crisis

Claim: Carney set a Bank of England culture that led to pension fund instability, which collapsed during Truss’s short tenure as PM.

Fact Check: The pension crisis occurred in September 2022, triggered by Truss’s own mini-budget, which caused bond yields to spike. The Bank of England intervened to stabilize markets, but the root cause was Truss’s unfunded tax cuts and market panic.

Verdict: Blame shifting—Truss's own budget decisions triggered the crisis, not Carney.

5. Carney’s Political Ambitions & Canadian Context

Claim: Carney wants to become Prime Minister of Canada, following a Davos/WEF-inspired globalist agenda.

Fact Check: Carney has expressed political interest and is involved with the Canadian Liberal Party, but he has not officially announced a leadership bid.

Verdict: Speculative and politically charged—Carney is politically active, but claims of him being "appointed" as PM are exaggerated.

Assessing Bias in the Interview

• The Toronto Sun is a right-leaning publication, and Brian Lilley is a known conservative commentator.
• The interview heavily promotes Pierre Poilievre’s conservative narrative, portraying Carney as a Davos elite with disastrous economic policies.
• Truss’s criticisms align with right-wing attacks on green policies, central banks, and international financial institutions.

Overall Conclusion

Liz Truss and the Toronto Sun frame Carney as a primary cause of Britain’s economic troubles, but this oversimplifies complex economic issues.

• Some criticisms (like QE concerns) have merit but ignore the broader economic context (Brexit, government policy failures, and global market forces).
• Many claims shift blame from Truss’s own failures (such as the pension crisis) onto Carney.
• Energy crisis and economic stagnation were not directly caused by Carney, though he supported Net Zero finance.

Final Verdict: Carney is not beyond criticism, but blaming him entirely for Britain’s economic struggles is misleading and politically motivated.

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Profiting from Power: Trump's Financial Moves in Office

By J. André Faust (Jan 23, 2025)

President Donald Trump's recent ventures into cryptocurrency, including the launch of meme coins such as $TRUMP and $MELANIA, as well as the establishment of a cryptocurrency working group through an executive order. These developments have raised ethical concerns among watchdogs, who argue that Trump appears poised to benefit financially from his presidency in new and potentially lucrative ways.

Ethics experts have expressed apprehension that Trump's direct involvement in cryptocurrency ventures could lead to conflicts of interest, especially given his administration's role in regulating the crypto market. The launch of these meme coins has been particularly controversial, with some analysts labeling them as speculative and opportunistic, lacking intrinsic value. The rapid appreciation of these coins has further intensified scrutiny, as it suggests potential for significant personal financial gain for the President.

Additionally, the executive order establishing a cryptocurrency working group has been viewed by some as a move that could disproportionately benefit Trump's personal crypto ventures. The order's directives to explore the creation of a national cryptocurrency stockpile and to propose new regulatory frameworks have led to concerns about the potential for policy decisions that could favor the President's financial interests.

In summary, This highlights the ethical debates surrounding President Trump's recent cryptocurrency initiatives, reflecting concerns about potential conflicts of interest and the propriety of a sitting president engaging in ventures that could result in personal financial gain.

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Sources:

BBC News. (2025). Trump launches cryptocurrency, raising ethics concerns. Retrieved January 23, 2025, from https://www.bbc.com/news/articles/c98y47vrv2jo

The Times. (2025). If lawless crypto wins, so do the billionaires. Retrieved January 23, 2025, from https://www.thetimes.co.uk/article/if-lawless-crypto-wins-so-do-the-billionaires-7g3wkqbcd

MarketWatch. (2025). Trump has called himself a 'crypto president.' Here's what his new executive order does. Retrieved January 23, 2025, from https://www.marketwatch.com/story/trump-has-called-himself-the-crypto-president-heres-what-his-new-executive-order-does-91c6394b

The Atlantic. (2025). The crypto world is already mad at Trump. Retrieved January 23, 2025, from https://www.theatlantic.com/technology/archive/2025/01/donald-trump-crypto-billionaire/681388

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High-Stakes Bargaining: Trump's Tariff Ultimatum Through Schelling's Lens (Game Theory)

By J. André Faust (Jan 20, 2025)

President Trump's recent announcement to overhaul U.S. trade policies, now coupled with the explicit threat of 25% tariffs on Canadian and Mexican goods by February 1, can be analyzed through the lens of Thomas Schelling's The Strategy of Conflict, which delves into bargaining, communication, and limited war.

Strategic Communication and Signalling

Schelling emphasizes the role of communication and signalling in strategic interactions. The addition of a firm deadline and explicit tariff threat changes the nature of the signalling dynamic:

• Demonstrating Immediate Resolve: The deadline underscores the administration's commitment to escalating trade reforms if demands are not met.
• Eliminating Flexibility: By setting a firm date, the U.S. reduces room for negotiation and signals a willingness to escalate further if necessary.
• Increasing Psychological Pressure: The looming 25% tariffs create urgency, forcing Canada and Mexico to reassess their strategies and potentially offer concessions.

Tacit Bargaining and Focal Points

Schelling discusses how parties often engage in tacit bargaining, where actions and statements serve as indirect negotiations. In this scenario:

• The February 1 deadline becomes the new focal point, concentrating efforts to avoid the threatened tariffs.
• The explicit threat removes ambiguity, pressuring Canada and Mexico to respond decisively.

Limited Retaliation and Controlled Escalation

The 25% tariff threat represents a significant escalation in the U.S.'s strategy:

• Escalation Initiated: The explicit tariffs signal a move beyond controlled signalling to a potential trade conflict.
• Risk of Retaliation: Canada and Mexico may respond with their own measures, potentially triggering a trade war.
• Strategic Leverage: While bold, this move risks long-term relationships if perceived as overly aggressive.

Implications for Canada

For Canada, the stakes have increased dramatically. Recognizing the strategic underpinnings of this threat is essential:

• Urgent action is required to either negotiate favourable terms or prepare for retaliatory measures.
• Aligning with Mexico to form a unified response could strengthen bargaining power.
• Misjudging the U.S.’s resolve could lead to significant economic consequences.

In summary, applying Schelling's insights reveals that President Trump's escalatory tariff threat transforms the dynamic from strategic signalling to high-stakes bargaining. The explicit deadline and severe tariffs serve as a calculated move to influence Canada's and Mexico's actions while leaving little room for misinterpretation. Remember Game Theory is based on probabilities, what is least likely to most probable. The million dollar question is if he doesn't modify his tariffs what are the chances that a trade war will take place between the two countries.

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Reference

Schelling, T. C. (1960). The strategy of conflict (pp. 53–80). Harvard University Press.

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GAME THEORY ANALYSIS OF THE SMOOT-HAWLEY TARIFF ACT

 By J André Faust  (Jan 19, 2025)

Below is a game theory analysis of the Smoot-Hawley Tariff Act (Tariff Act of 1930) and its repercussions. While this historical event predates the formalization of many game-theoretic concepts, we can nonetheless interpret the behaviour of the United States and its trading partners in strategic, game-theoretic terms.

President Trump informed Alberta Premier Danielle Smith, following their meeting at his Mar-a-Lago resort, that he plans to move forward with a 25% tariff on Canadian goods. This statement implies he is not bluffing. Examining the situation through the lens of the Smoot-Hawley Tariff Act, game theory suggests that other nations (or “players”) would likely respond in a similar manner. While this does not necessarily mean we would be plunged into another depression, it suggests we might see outcomes reminiscent of those experienced during the Smoot-Hawley era.

While history does not repeat itself exactly, the Smoot-Hawley Tariff Act offers a cautionary tale. If Trump continues his tit-for-tat tariff strategy, it could have serious economic consequences similar to those of the trade war of the 1930s, which served as the catalyst for the Great Depression. The key question now is whether international actors will de-escalate or whether this will spiral into a modern trade war with long-term consequences.

1. Setting the Stage: Players and Strategies

Players:

• The United States, aiming to protect domestic industries and farmers.

• Major U.S. trading partners (e.g., Canada, France), seeking continued access to U.S. markets and to safeguard their own industries.

Strategies:

1. Impose High Tariffs (Protectionist): Unilaterally raise or maintain high import duties to shield domestic producers from foreign competition.

2. Maintain or Lower Tariffs (Cooperative): Keep tariffs low or reduce them to foster international trade, despite short-term pressure from domestic industries.

In the Smoot-Hawley context, the United States chose Protectionist (raising tariffs), while its trading partners could respond by either accepting the tariffs or retaliating with tariffs of their own.

2. Game Structure: A Multi-Player “Trade War” Scenario

Game theory often models trade interactions as a variant of the Prisoner’s Dilemma:

• Short-Term Gain: If one player imposes high tariffs while others do not retaliate, that player can enjoy short-term benefits (domestic industry protection, potential political support).
• Retaliation Risk: However, if the other players also impose high tariffs, overall trade suffers—everyone is worse off.

When the U.S. raised tariffs drastically under Smoot-Hawley, it essentially made a unilateral “defection” move. This spurred other nations to retaliate with their own tariffs, dragging all parties into a non-cooperative equilibrium where trade volumes declined significantly.

3. Payoffs and Outcomes

• U.S. Short-Term Payoff: Protection for certain domestic industries and a political narrative of “protecting jobs.”
• U.S. Long-Term Payoff: Retaliatory tariffs severely reduced exports, contributing to a deeper economic downturn. Industries relying on international sales were particularly harmed.
• Trading Partners’ Payoff: They faced higher barriers to exporting goods to the U.S. Imposing retaliatory tariffs helped them politically at home but shrank global trade overall.
• Collective Outcome: The strategy profile where everyone imposes high tariffs is Pareto-inferior. No single country benefits enough to offset the overall loss in global trade, contributing to worsening conditions during the Great Depression.

4. Retaliation and Repeated Games

In a single-shot game, one might gain by imposing high tariffs while others keep them low. However, global trade is typically a repeated game, with ongoing interactions over time. Retaliation (tit-for-tat) is common:

• Tit-for-Tat: After Smoot-Hawley, countries like Canada immediately raised tariffs on U.S. goods, mirroring U.S. action.
• Persistent Non-Cooperation: Once both sides enacted protectionist stances, reversing course required significant policy shifts (which did not occur until the mid-1930s with reciprocal trade agreements).

5. Information and Expectations

Over 1,000 economists opposed Smoot-Hawley, indicating a strong belief it would backfire. In game theory terms, this reflects:

• Incomplete Information: U.S. policymakers underestimated other nations’ willingness to retaliate.
• Overoptimistic Beliefs: Officials presumed other countries might not retaliate or that domestic gains would outweigh any global drawbacks.

6. Lessons Through a Game Theoretic Lens

• Mutual Gains Through Cooperation: International trade is often more beneficial if nations lower tariffs collectively.
• Danger of Defection: One nation’s decision to raise tariffs can trigger a chain reaction, leading to a “trade war” that hurts all players.
• Importance of Repeated Interactions: Over time, trust and stable agreements (like GATT and the WTO) serve to prevent destructive cycles of retaliatory tariffs.

From a game theory perspective, Smoot-Hawley exemplifies how short-term political gains can lead to non-cooperative equilibria with long-term collective losses.

Conclusion

The Smoot-Hawley Tariff Act represents a classic case of defection in an iterated trade game. By dramatically raising tariffs, the U.S. encouraged other nations to do the same, resulting in economic isolation and a deeper global crisis. The severe consequences of this non-cooperative strategy helped pave the way for more cooperative, rules-based global trade policies in the decades that followed, which may be how the Trump game will end.

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History in the Making or Repeating? The Perils of Trump’s Protectionism

 By J André Faust  (Jan 19, 2025)

The Smoot-Hawley Tariff Act (officially the Tariff Act of 1930) was a U.S. law enacted on June 17, 1930. Sponsored by Senator Reed Smoot (R-UT) and Representative Willis C. Hawley (R-OR), it raised tariffs on thousands of imported goods to historically high levels. While it was initially intended to protect American farmers and industries from foreign competition in the wake of declining agricultural prices, it ended up having far-reaching negative consequences for both the U.S. and the global economy.

1. Context and Motivations

• Agricultural Decline: American farmers had already been struggling throughout the 1920s due to falling crop prices and overproduction. Legislators believed raising tariffs on agricultural imports would help farmers compete and recover.
• Great Depression Onset: The stock market crash of 1929 deepened economic woes, increasing political pressure to protect domestic industries and jobs. Protectionism seemed, at first glance, like a way to bolster American businesses at home.
• Widespread Opposition by Economists: Over 1,000 economists signed an open letter urging President Herbert Hoover to veto the bill, warning that it would stifle international trade and hurt the U.S. economy in the long run.

2. Main Provisions

• Significant Tariff Increases: The Act raised tariffs on thousands of products, including agricultural items and various manufactured goods. In some cases, tariffs rose to levels that effectively priced foreign goods out of the U.S. market.
• Trade Policy Shift: Smoot-Hawley marked a shift away from the relatively more open trade policy of the 1920s, setting the stage for retaliatory measures from other nations.

3. Immediate Effects

• Retaliatory Tariffs: Countries such as Canada, France, and others responded with tariffs on U.S. exports. As a result, American farmers and manufacturers found it harder to sell products abroad.
• Decline in Global Trade: The Act contributed to a rapid decline in international trade. Although the Great Depression had multiple causes, the sharp rise in tariffs and subsequent retaliation exacerbated the global economic downturn.
• Economic Isolation: Higher tariffs diminished opportunities for global cooperation and trade, reinforcing a trend toward economic isolation among major industrialized nations during the early 1930s.

4. Longer-Term Consequences

• Deepening the Great Depression: While not the sole cause of the Great Depression’s severity, Smoot-Hawley is widely regarded by historians and economists as intensifying the crisis by shrinking world trade and aggravating financial instability.
• Shift in Trade Policy: Over time, the negative experience with protectionist policies led to a major shift in U.S. trade policy. By the mid-1930s, President Franklin D. Roosevelt’s administration began negotiating reciprocal trade agreements to lower tariffs and encourage international commerce.
• Lessons for Policy: Smoot-Hawley remains a textbook cautionary tale about protectionism. Economists and policymakers often cite it as an example of how raising trade barriers can cause significant economic harm, especially during periods of global financial stress.

5. Legacy

• Changed View of Tariffs: The negative repercussions of Smoot-Hawley influenced future generations of leaders to seek more cooperative trade policies, culminating in multilateral trade arrangements after World War II (e.g., the General Agreement on Tariffs and Trade, later the World Trade Organization).
• Cautionary Example: Discussions about protectionist measures often reference the Smoot-Hawley Act to highlight the dangers of triggering trade wars and isolating domestic industries from global markets.

In Summary

The Smoot-Hawley Tariff Act of 1930 was a protectionist measure born out of efforts to shield U.S. farmers and industries during an economic downturn. Instead, it provoked retaliatory tariffs from trading partners, contributed to a collapse in international trade, and worsened the global depression of the 1930s. Its legacy endures as a strong argument against aggressive tariff hikes and isolationist trade policies, especially during economic crises.

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