When Donald Trump tells rally crowds that he has “stopped eight wars” and that economic threats are the secret sauce of peace, he is not inventing a new foreign policy. He is reviving an old Western faith: that money, markets and economic leverage can succeed where politics fails.
For decades, Western foreign policy has been premised on the conviction that economics could do the heavy lifting of peace. After the Cold War, that conviction hardened into orthodoxy. Growth would bring stability. Trade would soften rivalries. Capital flows and supply chains would sand down the rough edges of history. Tie states tightly enough into markets, the theory went, and war would simply become too expensive to contemplate.
This was not just an idea; it became a governing assumption. Policy papers, aid programmes and national security strategies were built around it. Politics was treated less as a site of negotiation and compromise than as a problem that smart economic design could bypass.
Trump has not rejected that worldview. He has inverted it. Where post–Cold War orthodoxy promised peace through openness and integration, Trump offers peace through pressure and coercion. Since returning to the White House in 2025, he has repeatedly credited himself with halting conflicts by flexing American economic muscle. He presents tariffs as negotiations by other means, i.e. faster, cruder and more easily branded than diplomacy.
The example Trump most often cites is his claim that US trade threats against India and Pakistan in May 2025 helped avert a nuclear crisis. “No trade unless you stop the war,” he said, offering it as proof that economic coercion can achieve what decades of diplomacy could not.
The story resonates because it rests on a familiar logic. This is the Washington Consensus, updated for a protectionist age. In the 1990s, market-led peacebuilding became gospel. From the Balkans to Afghanistan, the International Monetary Fund and the World Bank sold privatisation and liberalisation not only as economic reform but as conflict resolution. Development, we were told, would dampen violence. Markets would create stakeholders in peace.
Peace is not a profit margin. It is negotiated, contested and stubbornly, irreducibly human
Reality was less accommodating. Economic reform altered incentives, but it did not resolve grievances or power struggles. Growth did not dissolve identity, ideology or historical memory. The promise that markets alone could deliver stability repeatedly collided with the stubborn persistence of politics.
Earlier versions of this doctrine promised peace through liberalisation and integration; Trump’s version promises peace through trade threats. The core assumption remains unchanged: adjust the price signals and political behaviour will follow. Make conflict expensive enough, and rational actors will choose peace.
History tells a cautionary tale. The belief that economic interdependence naturally produces peace has fared poorly. Europe’s dependence on Russian gas did nothing to prevent the invasion of Ukraine; if anything, it constrained Europe’s response once war came. Expanding US–China trade did not dissolve strategic rivalry either. Deep supply-chain integration coexisted comfortably with intensifying geopolitical competition. Commerce did not tame power politics; it often simply ran alongside it.
Coercive economic tools have performed no better. Iraq. Iran. Venezuela. North Korea. Sanctions strangled economies while entrenching ruling elites. Conflicts endured. In many cases, economic pain did not translate into political concession; it translated into consolidation, strengthening the very actors sanctions were meant to weaken, while ordinary citizens bore the costs.
Lasting peace depends on less glamorous work. Sustained diplomacy. Inclusive political settlements. Local ownership of peace processes. Credible international guarantees. Mechanisms for justice and accountability. It is slow. It is messy. It involves talking to people you dislike and making compromises you would rather avoid. It does not fit neatly on a rally placard or a balance sheet.
Trump’s vision resonates because it taps into a powerful ideological current: the belief that markets can solve everything, including war. It flatters a managerial instinct in Western politics, i.e. the conviction that complex human conflicts can be reduced to incentives and disincentives, spreadsheets and leverage points.
Economics can support diplomacy. It can reinforce negotiation. It can create space for political deals to hold. It cannot replace politics. When treated as a substitute, it tends to delay rather than resolve conflict, hardening positions and narrowing options.
More than three decades after neoliberal peacebuilding went mainstream, the lesson should be clear. Markets do not make peace on their own. Economic pressure cannot resolve conflicts. If stability is the goal, leaders will have to return to the hard work of politics. That means sustained diplomacy, negotiated compromises and direct engagement with the forces that actually drive conflict.
Trump’s rhetoric offers a comforting illusion. It suggests peace can be bought with economic power. That war is just a transactional problem. That decades of conflict can be solved with tariffs, sanctions, or a threat of trade restrictions. This is the fantasy of control: that you can manufacture peace without the hard work of talking, compromising and building relationships.
Peace is not a profit margin. It is negotiated, contested and stubbornly, irreducibly human.