(from the series “Trump’s America and the New World Order”, part 10)

               Business makes diplomacy

From the early 20th century, the top bureaucracy of governments and political parties controlled and ruled all developed countries, despite their political system, form of government and their ideological affiliation. In 2025, manufacturing and high-tech business took power in the United States, and that business’ interests began to determine policy, putting bureaucracy and ideologies in a subordinate position and discarding everything in the state system that hinders the development of high-tech sectors of the US economy.

The peculiarity of the “Trump revolution” is that power in the USA was taken not by representatives of financial or banking capital, or speculative investors, but exactly by representatives of the high–tech manufacturing business, of the AI and other most advanced technological spheres, who are interested in the fastest possible transition of the economy and society to a new technological level, in maintaining America’s global technological domination and leadership. It is this business that began to form a new world order. Now the Kremlin and BRICS began to join this process, slow and with difficulty, and Russian business was the first to get involved in the process.

Only three weeks ago, delegations from the United States and Russia met in Riyadh to begin the process of formal negotiations on rebuilding the world, restoring relations between the two superpowers, and ending the wars in the Middle East and Ukraine. The Russian delegation was led by Sergei Lavrov, the Russian foreign minister, and by Putin’s aide Yuri Ushakov, the Kremlin’s top international policy maker, and was joined only at the last minute by Kirill Dmitriev, the head of the Direct Investment Fund, representing business.

According to information from unofficial independent Russian media, the idea of Dmitriev’s participation in the negotiations did not come from Lavrov or Ushakov, but from outside, from business, and the decision on his participation in the negotiations was made personally by Vladimir Putin.

Two weeks passed, and Dmitriev alone arrived from Moscow to Washington for the talks, while officials, including Russian diplomats, were supporting his visit in subordinate roles. Dmitriev’s main counterpart in the talks was Witkoff, the key business figure in the Trump administration and Trump’s longtime business partner.

The agreements reached by Dmitriev in Washington will be the subject of a new round of negotiations in Riyadh in a few days, where Lavrov and Ushakov will arrive along with Dmitriev.

This means that the current US-Russian negotiations, including on political and military issues, are based on precisely economic interests, primarily the interests of high-tech manufacturing business that now shapes the White House and the Kremlin’s approach to the solution of international problems, including problems in conflict zones and their relations with Europe and China.

There are two more important events to note:

1. The emergence of US and Russian business representatives as central figures in the negotiation process coincided with the introduction of tariffs on the supply of goods to the US from many countries around the world, including Washington’s traditional trade and military-political partners.
2. After retreating from Kursk region, the Ukrainian Armed Forces bombed several times and burned down the Sudzha gas pumping station located on the border with Ukraine that supplied gas via pipelines from Russia to Europe through Ukraine and was under the control of the Ukrainian Armed Forces for several months. The Ukrainian Forces also bombed and destroyed the oil depot in Krasnodar region in Russia that provided transshipment of oil produced in Kazakhstan, mainly by American corporations, from railway tanks to the Caspian Pipeline Consortium (CPC) pipeline system. As a result of this attack, oil supplies from Kazakhstan to Europe were stopped.

Speaking about the results of his trip to Washington, Kirill Dmitriev named the main issues that he had discussed, including cooperation in the development of rare earth metals, joint projects in the Arctic, energy and LNG production and the return of American companies to Russia.

There is also unofficial information about the issues that Dmitriev discussed in Washington. Russian unofficial sources say that during the negotiations, agreements were reached that the Russian corporation Rosneft would sell its shares in three oil refineries in Germany, as well as one refinery in Serbia, to American companies that suffered as a result of the attacks by the Ukrainian Armed Forces on the Caspian Pipeline Consortium (CPC) oil depot in Krasnodar, in particular, the Chevron corporation.

It is also reported that decision has been made that American corporations participate in joint projects to produce LNG in the Arctic and will start buying LNG for rubles on the St. Petersburg exchange to export LNG to Europe. The difference in prices in Russia and Europe can reach hundreds of percent, especially in the initial period. The Ukrainian media sources also name Chevron among the project participants.

It is also reported that the US has begun to exclude Russian citizens who are close to Putin or whose participation is necessary to restore relations between Washington and Moscow, from the sanctions list. In particular, the US Treasury Department has excluded Karina Rotenberg, the wife of Russian billionaire Boris Rotenberg, close and long-time friend of Putin, from the sanctions list. Kirill Dmitriev himself, who flew to Washington for negotiations, was until recently listed on Washington’s sanctions list.

According to Russian independent sources, the Kremlin has given the green light to the agreement that allows Goldman Sachs to sell shares of Russian transnational corporations, including Gazprom, Rosneft, Inter RAO, Novatek, Surgutneftegaz, Tatneft, Lukoil, NLMK, Rostelecom. These shares will be bought by the Russian Balchug Capital that will receive the right to freely resell these shares on the world market.

This means that for the first time since the war in Ukraine began, the US will unblock some of the frozen Russian assets, primarily those associated with Russian transnational corporations, in exchange for concessions from Moscow.

However, the most important factor in the development of the world economy was the introduction of the “Trump tariffs”. Although, there is no confirmation that Dmitriev personally met with Trump, the results of his trip to the United States and his talks in Washington, including at the White House, must be analysed taking into account the real, and not fictitious, promoted by politicians and the media, possible consequences of Trump’s introduction of tariffs.

                      Some get tariffs, others get benefits

In the 1990s, I had to, or was lucky enough to work at York Corporation, Pennsylvania, US (now part of the Johnson Controls group), at that time one of the two hundred largest American public companies, as its representative in Moscow and General Manager of its branch “York Russia” that was responsible for the markets of all countries of the former USSR.

By the mid-1990s, York Corporation, the world’s largest manufacturer of compressor equipment and air conditioning systems, raised its share of the Russian market, as well as the markets of other countries of the former USSR, from 0% in 1992 to 60% in 1996, and York-Russia was named that year, as the best foreign division of the corporation.

This unique experience allows me to highlight important elements of the real scheme by which Trump intends to use tariffs to influence the economies of Washington’s rivals, including those countries that have been considered its allies for decades, and to carry out the “Trump perestroika” of the entire global economic system.

In the 1990s and 2000s, I was struck by the fact that neither in the Kremlin, nor in the Russian government, nor in the banking sector (with the exception of the short period of Yevgeny Primakov’s premiership) did I meet a single person who knew how real American business works, including on the territory of Russia and the former Soviet republics.

Let me start my analysis of the “Trump tariffs” situation with some important facts:

1. In the late 1980s, with the beginning of the collapse of the socialist political system and the economies of the socialist camp countries, Western corporations absorbed the industries and markets of Eastern European countries and the USSR. This allowed American corporations to receive huge flows of cash, and that allowed them to buy up a significant number of the most successful companies in Western Europe and other regions of the world with rapidly developing economies. Thus, in Europe, at the beginning of the 21st century, there was only one independent manufacturer of chillers and compressor equipment left, and it was located in Germany. In fact, in Europe there is not a single branch of modern production and services where American corporations are not represented in the form of their branches or European companies whose shares owned by American corporations, and they compete with local companies, with local businesses.
2. At the same time, the huge cash flows of transnational corporations made many banking services unnecessary, especially loans. Banks remained useful only as technical organizations that provided accounts and carried out payments and money transfers. At the same time, new technologies and the development of the Internet made it possible for corporations to create their own payment systems for the operational management of finances and cash flows. In the early 1990s, the existing banking system became obsolete and outdated.
3. This forced banks to find a way to remain a necessary element of the financial system. The solution was found in the creation of a system that increased the volume of lending to the population, stimulated an increase in the debt burden of states, ensured the growth of speculative capital and speculative operations, developed areas in the economy that required inflated financial expenses, for which fake theories and ideas began to be created that justified these expenses, and most importantly, created the interest of corporations from the real production and high-tech sectors in bank loans. The US banks opened unlimited credit lines for corporations at a minimum interest rate – from 0.5% to 1% in the United States and up to 4% for branches of corporations in developing countries and former Soviet republics.
4. In the early 1990s, a Russian citizen could get a loan from a Russian bank at an interest rate of 150-200% per annum.At the same time, York-Russia could get a loan from an American bank in Moscow at 4% per annum, which was considered unreasonably high and was explained by the problems and requirements of the Russian undeveloped financial system and legislation. Currently, in Europe, India or China, branches of American companies, I assume, have the opportunity to receive unlimited loans at less than 1% per annum. The financial and banking systems of China operate according to the same scheme, but with more active participation of the state.
5. In the late 1980s, American corporations entered into a deal with banks. Corporations received loans at 0.5% – 1% per annum to cover all their production and trade expenses, and directed their financial flows and resources to the purchase of manufacturing companies in other countries, as well as to the construction of new production facilities, including those using new technologies. These investments generated an average of 20% return per year on invested capital.
6. That created an unexpected problem. With the intensive expansion of business and sales markets, the factories located in the USA were fully loaded. It was not reasonable to stop them for modernization and reconstruction. Political factors also played important role: re-equipment of enterprises could lead to an increase in unemployment and social tension in the USA. The construction of new factories in the US was also not reasonable because it could lead to an increase in domestic competition in the US market. Under these conditions, decision was made to build enterprises using the latest technologies outside the USA.
7. First, in the early 1990s, the decision was made to build factories in Russia, and then, when corruption conflicts engulfed the Kremlin, decision was made to build factories using the latest technology in China. This was the result of the corruption conflict during the reconstruction of the Grand Kremlin Palace in 1994-95, in which I had to become an active participant. As a result of this conflict, in 1996, the Head of the Property Management Department of the President of the Russian Federation Yeltsin, Pavel Borodin, was even arrested in the USA, spent several months in a Brooklyn prison, and his accounts (and the accounts of the members of the Family, Boris Yeltsin’s clan) in Switzerland were frozen.
8. As a result of the decision taken, by the mid-2010s, production facilities based on the latest technologies were mostly built outside the United States, primarily in China, Taiwan, Latin America, India, and Southeast Asia.
9. At present, a transition to a new technological level is taking place, and Trump has to create conditions under which it will be profitable for American transnational corporations to build new factories specifically in the United States or in countries that will be included in the American civilizational macro-region.
10. Many multinational corporations are registered in the US state of Delaware that has favourable taxation. More than half of all publicly traded US companies are registered in Delaware, including 70% of the world’s 500 largest companies.
11. Transnational corporations have their own internal system of payments and pricing. The products they manufacture in the United States are sold abroad exclusively to their branches, the distribution companies, at prices that do not exceed 30% – 40% of the official price list. However, if the most favourable tax conditions are created in any country, then the corporation’s division in this country becomes (or is appointed) the main and even exclusive supplier of products outside the United States. Thus, in 1994, Italian Prime Minister Silvio Berlusconi exempted the US transnational corporations from income tax for several years if they invest in Italian companies. As a result, all divisions and branches in Europe of those corporations were instructed to supply products manufactured by Italian divisions to all markets. The export prices in Italy were often higher than the sale prices in the European markets. Corporation divisions were ordered to work not only using bank credit resources (the money received under contracts was sent to the corporations’ account in the USA, Delaware), but also at a loss. At the same time, the internal reporting, by which the branch management were assessed, took into account the internal corporate prices, and not the official sales and purchase figures.

            So, what conclusions can be drawn from the above?

            First. Trump’s tariffs are not aimed at the US multinational corporations. On the contrary, they will help them capture markets, including significant market segments within the countries where they are registered.

            For example, an American car or chip producer in China would be subject to a 54% or even 104% tariff when exporting to the United States, but the corporation could redistribute profits within its divisions, avoiding the tariff’s impact and without harming the interests of regional managers.

            Thus, the plant can reduce prices for cars or chips, even operate at a loss that allows, after paying the tariff, to rise prices of cars or chips to the level of pre-tariff prices. The loss of the corporation’s Chinese division will be adjusted in the internal corporate reporting.

            At the same time, Chinese transnational corporations and manufacturers will be forced to either bear losses or raise sales prices on the American market. This will lead to an increase in the share of American manufacturers on the Chinese and world markets.

However, if tariffs, as is happening in China, are raised by Trump above 100%, such tariffs become prohibitive. This means stopping China’s exports to the US worth hundreds of billions of dollars, which causes enormous damage to the Chinese economy or forces the Chinese leadership to make the political and economic compromises that Trump needs. At the same time, Trump can make an exception for American corporations operating from China, significantly reducing or even exempting them from tariffs. That will give the whole Chines export under the control by US corporations.

            In addition, American corporations may temporarily stop deliveries from China and involve their branches in other countries in deliveries. Thus, computers and the iPhone may be delivered from China to India, and produced in India will be exported to the US. That will also allow Trump to influence Beijing and Delhi foreign policy.

            Second.  “Trump tariffs” initiate the process of absorption by American corporations of European, Chinese, Indian companies, as well as in other regions with the biggest economic growth. It will be profitable for local companies to either move their production to the USA, or sell their shares, become divisions of American transnational corporations, fit into their internal financial schemes.

            Third. “Trump tariffs” lead to a sharp rise in the stock prices of those corporations that find themselves in a more advantageous situation. The stock market falls under the enormous influence of Trump and his team.

Fourth. Trump and his team started restructuring the global financial system that is also to be divided into zones of macro-regions with their own currencies and financial systems that will be interconnected and integrated in one world system, and this financial integration will be based on the dominance of high-tech American corporations.

            Fifth. The world is splitting into civilizational macro-regions, and Trump is trying to create the strongest, most economically and financially developed American macro-region, where the US transnational corporations play the role of system-forming structures that ensure economic development and financial stability. All other business, including the banking system, becomes a secondary sphere of the economy, serving transnational high-tech corporations, and that gives them the opportunity to gain complete political power and create a new ideology.

            (To be continued)