Amid the in-depth economic discussions at the 2026 World Economic Forum in Davos, US Treasury Secretary Scott Bisnett's remarks stood out as a clear declaration of a new phase of "economic nationalism" and geopolitical confrontation. Bisnett, considered the architect of fiscal policy in the Trump administration, didn't just talk about budgets; he outlined a defensive economic strategy aimed at disengaging strategically from adversaries and securing supply chains whose deadly fragility was exposed by the COVID-19 pandemic.
The COVID-19 Pandemic: A Harsh "Rehearsal" for Tomorrow's War
In a striking analysis, Scott Bisnett argued in his interview with Fox Business that the COVID-19 pandemic, despite its tragedies, provided a "strategic service" to Washington. It served as a practical simulation of what could happen to the US economy if the supply of vital goods were disrupted by an actual military conflict.
The Secretary explained that the pandemic exposed vulnerabilities in economic national security, prompting the administration to identify six or seven critical industries that cannot be left at the mercy of international fluctuations or foreign influence. Foremost among these industries is advanced semiconductor technology, which he described as the brains behind everything from smartphones to intercontinental ballistic missiles.
The Taiwan Dilemma – 97% Under the Geographical Guillotine
In a cautionary tone, Bisent described the over-reliance on Taiwan for the production of 97% of the world's most advanced semiconductors as "the greatest threat to the global economy." The Secretary believes that Taiwan is not merely a trading island, but a "single point of failure" in the global system.
Any potential Chinese blockade of the island, or the destruction of its production infrastructure, would not only cause a recession but would lead to a "comprehensive economic catastrophe" that would cripple American industry. Hence, Bessent emphasized that the current administration's strategy aims not only to support domestic manufacturing but also to forcibly "relocate" this industry within the United States to ensure the nation's survival in the event of an armed conflict in the Pacific.
Rare Earth Minerals... Breaking the "Chinese Sword" Hanging Over Our Heads
Bessent addressed the issue of rare earth minerals with unusual severity, describing China's current control over these resources as "a sword hanging over our heads." The Secretary acknowledged the failure of previous attempts by American companies to compete with China due to the "price war" and Beijing's monopolistic pressures, which led to the bankruptcy of those companies.
The Countermeasure: An International Mining Alliance
Bessent revealed a serious American initiative to form an international rare earth alliance comprising the G7, Australia, India, Mexico, and South Korea. The goal is not merely extraction but building a comprehensive system that includes:
- Independent Mining: Free from Chinese investments.
- Refining and Production: Breaking the Chinese technology monopoly in processing these minerals.
- Self-Sufficiency: Bisent expressed optimism that the United States would achieve energy self-sufficiency within just two years, citing the South Carolina magnet plant, which resumed operations after a quarter-century hiatus.
The Language of Tariffs and Tangible Results
Bissent defended President Trump's approach of using tariffs as a negotiating tool, asserting their effectiveness. He pointed out that the threat of tariffs was what prompted China to soften its stance on rare earth elements and lift restrictions on its exports last October.
The Secretary also announced progress in trade negotiations with Beijing, exemplified by the massive 25 million-ton soybean deal. He argued that China was beginning to realize that access to the American market comes at a price and that the old rules of free trade were irrevocably over.
NATO... The End of an Era of American "Prosperity"
Bissent then turned to the issue of allies, fiercely defending Trump's demand that NATO members increase their defense spending. The Secretary presented a striking numerical comparison; Since 1980, the United States has spent approximately $22 trillion defending the alliance, an amount exceeding the combined contributions of all other allies.
Bissent sharply criticized the Europeans, arguing that they had exploited the "American security umbrella" to free up their budgets for social services and welfare, while Washington bore the brunt of the blood and treasure. He stated unequivocally, "It's time they paid more," emphasizing that defending freedom is not solely the responsibility of the American funder.
Warning Europe Against "Unwise Retaliations"
In closing, Bisent issued a stern warning to European countries considering imposing retaliatory tariffs in response to Trump's tariff policies (related to Greenland or other issues). The Secretary described any escalatory European move as "unwise," implying that American economic power could win any trade war and that Europe's best interests lay in cooperation rather than confrontation.
Features of a “Sovereign Economy”
Scott Bisent’s remarks reflect a radical shift in American economic thought; from “open globalization” to “security-conditioned globalization.” Washington’s message from Davos is clear: we will not leave the future of our technologies at the mercy of Taiwan, we will not leave our minerals at the mercy of China, and we will not bear the security of our allies for free. We are entering a phase where “ally” is being redefined based on their financial contribution, and “industry” is being redefined based on its geographical location. The world, as Bisent sees it, has entered an era of “strategic protectionism,” where economic power is the first bullet in any future conflict.
