Foreign Policy and Globalism

Foreign policy

Foreign policy is the conduct of the nation’s government in relations with other countries. It encompasses a wide variety of activities including diplomacy, defense policy, foreign aid, and national security. Its broadest meaning includes the promotion of America’s values abroad and the development of international institutions that reflect American interests.

Despite globalization, foreign policy remains one of the most challenging, complex, and vital tasks facing the United States. Ultimately, the question is not whether or not the United States should engage in foreign policy; rather, the question is how to best pursue its goals in a rapidly changing world.

Americanists see great virtue in the fact that America’s primacy allows it to set its own goals unconstrained by other nations, international agreements, or institutions. As Charles Krauthammer puts it, “An unprecedentedly dominant United States must reassert its freedom of action.”

Globalists, by contrast, believe that in an age of rapid change, the world needs to create new institutions and regimes that reflect a growing number of voices. As the architects of the European Union, North Atlantic Treaty Organization, and International Monetary Fund demonstrate, a more diverse approach to global governance can reduce the chances of cultural and political tactics that sap the strength of the world’s greatest power.

The reality is that the world faces many serious challenges and problems, ranging from climate change to nuclear proliferation to regional instability in Asia. Both Americanists and Globalists are right that it is important for America to continue building partnerships throughout the world to address these challenges, but to do so successfully requires that Washington upholds democratic values while promoting economic growth. Upholding democracy and human rights requires speaking out against abuses in China, Iran, and Russia; maintaining laws that prohibit the provision of security assistance to abusive regimes; and employing a full range of policy carrots and sticks to encourage democratic development and hold rights violators accountable.

Global GDP – What Is It and What Is It Not?

Global GDP

Across the globe, growth has slowed this year as higher tariffs and ongoing policy uncertainty slow investment and trade. Weaker global GDP growth is projected to persist this year and next. However, our analysis suggests that a reduction in global trade restrictions and less policy uncertainty could lift world GDP by 0.2 percentage points over the course of 2025 and 2026.

The largest component of GDP is C (consumption), which includes the purchase of durable and nondurable goods and services by households, such as food, jewelry, gasoline, and medical expenses. Another important component of GDP is I (investment). I includes expenditures on fixed assets by businesses and individuals, such as machinery and equipment. It also includes the value of any government investment in infrastructure.

While GDP is an important indicator of economic performance, it has limitations. For one, it relies on recorded transactions and official data, and it does not capture the extent of informal or unrecorded economic activity. In addition, it does not take into account certain phenomena that impact citizens’ well-being, such as pollution from traffic jams or the contribution of unpaid labor. As a result, alternative measures of economic development have emerged. These include the Human Development Index and the Better Life Index, which are designed to measure aspects of well-being that go beyond GDP.