A Foreign Policy Memo for the New US Administration
Foreword: A Foreign Policy Memo for the New US Administration
By Dr. Alexandra de Hoop Scheffer
The second Trump administration takes office amid profound changes to the global geopolitical and economic landscape, presenting US decision-makers with major challenges and significant opportunities. They will need to provide urgent, innovative answers to strategic questions that will shape relations between United States, Europe, and the rest of the world for the next four years and beyond.
More than ever, issues of US and European security are linked to our complex transatlantic economy and its place in the global order. Trade, energy, access to critical supply chains, and technology are levers for cooperation—not just on defense and security, but also on factors that thrive in a secure transatlantic environment: industrial power, lasting economic growth, and reinforced democratic norms.
Chinese and Russian economic and military ambitions and Europe’s recent anemic growth overshadow a critical reality: the United States and Europe continue to have the largest, most integrated bilateral trade and investment relationship in the world. US businesses invest four times as much in the EU as they do in the Asia-Pacific region, and European companies invest over ten times more in the United States than in India and China combined. Since the outbreak of the war in Ukraine, the United States has become a pivotal supplier of energy, mainly liquefied natural gas, to Europe. The transatlantic economies are changing, but they are enmeshed in complex, interdependent ways that grow out of our shared commitment to norms, open markets, and transparency. This relationship needs rebalancing, but it is undoubtedly a source of strength faced with authoritarian regimes and unfair competition.
To this end, GMF’s forward-looking series offers critical insights and policy recommendations for US officials in key areas of our expertise: transatlantic security, China, Russia, Ukraine, allied competitiveness, technology, and the resilience of American democracy. Decisions made by this administration will have lasting impacts in all these areas and on the economic and geopolitical fortunes of the transatlantic alliance.
The Trump administration inherits a NATO alliance that is more robust and committed than it has been in decades, with significant increases in defense spending and the accession of Finland and Sweden. US leadership in NATO should prioritize resolving the war in Ukraine, deterring Russian aggression, and addressing emerging challenges posed by China. Doing so, writes Kristine Berzina, will mean maintaining a strong US presence in Europe, keeping Ukraine’s NATO membership path open, and fostering technological collaboration among allies to counter hybrid threats.
Beijing’s ambitions have transformed China from a systemic rival to a systemic threat to transatlantic stability. Looming behind strategic security challenges (its alignment with Russia and pressure on Taiwan) is its “Second China Shock”, which targets industries critical to Western economic resilience and disrupts global markets. Andrew Small and Bonnie S. Glaser advocate for a coordinated US-EU response: aligned export controls and economic security tools, and better preparation for potential aggression by China. A united approach can mitigate the country’s dominance in key sectors and ensure the transatlantic alliance’s competitiveness.
The new administration also faces stark choices in dealing with Moscow. The Kremlin’s ambitions extend far beyond Ukraine. Russia aims to undermine US leadership and NATO’s security architecture. For David Salvo, conceding to Russia’s demands for a settlement on Ukraine would weaken transatlantic security. Instead, the United States must adopt a strategy of “peace through strength”: unrestricted military assistance to Ukraine, expanded sanctions targeting Russia and its enablers, and a clear vision for lasting peace. Josh Rudolph, in his contribution, elaborates on this. By arming Ukraine with American weapons, expanding sanctions and raising oil and gas prices, confiscating Russian assets, ensuring that Europeans pay their fair share, and leaving NATO accession open, the Trump administration would also create American jobs and markets for US companies. A good deal would successfully deter Russia and China but also avoid tarnishing Trump’s record with an Afghanistan-style collapse while securing his legacy as a decisive leader of the free world.
Our democracies are also grappling with rapid technological change and economic coercion, particularly from China. Economic partnerships will be key to expanding allied strategic competitiveness to address unfair competition and regain leadership. To this end, Penny Naas recommends rebooting the Transatlantic Trade and Technology Council to focus on strategic industries, aligning regulatory frameworks to attract investment, and fostering joint innovation in semiconductors, critical minerals, and artificial intelligence (AI).
Lindsay Gorman underscores the decisive role played by technological innovation in the global balance of power. To counter autocratic advances, the United States and its allies must lead on AI, quantum computing, and biotechnology. The United States must prioritize investment in critical AI applications, foster transatlantic partnerships for quantum innovation, and implement a cohesive technology security strategy with its European and Indo-Pacific allies. Doing so requires upholding bipartisan consensus on China and reinforcing democratic values in technology governance.
Finally, but no less important, are challenges to American democracy in an era of unprecedented information challenges. Rachel Dean Wilson outlines how the US information space is fragmented by rapid technological advancements, foreign interference, and domestic polarization. This is a systemic vulnerability. To revitalize its democratic institutions and bolster US credibility, the administration should lead a national discussion about the future of the information ecosystem, integrate AI literacy into public debate, and raise awareness on foreign interference, at different scales, all while working locally and with European allies to do so.
This GMF series offers a roadmap for officials to navigate the complex challenges of our geopolitical moment. The United States’ economic strength and integration into the world economy give it the power to shape the global order, defend democracy, counter authoritarian powers, and lead in technology. To succeed, it must leverage and strengthen transatlantic alliances, embrace innovative policy and technological solutions, and assert its democratic values. Navigating the next four years will demand resolve and creativity. With its allies, the Trump administration and the United States can rise to meet this moment and ensure that the transatlantic partnership remains a cornerstone of our global stability and prosperity.
Dr. Alexandra de Hoop Scheffer is the acting president of GMF.
Download the full foreign policy memo here.