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The competition between democracies and authoritarian regimes will shape the future of global power. China and Russia, alongside North Korea and Iran, aim to weaken US influence. To prevail, the United States must integrate economic power into its strategy, counter unfair trade practices, and support key industries. This report urges President Trump to issue an executive order for a coordinated economic statecraft strategy and improved analytic capabilities to enhance decision making.
Key Takeaways
- Competition between the free world and authoritarian regimes will determine whether democracy and free-market economies prevail over authoritarianism and statist economic models.
- American economic power is essential to winning this competition, yet US administrations consistently undervalue the degree to which strategic application of economic power is essential for advancing US vital interests.
- President Trump has a historic opportunity to correct this chronic shortcoming in US grand strategy with an integrated approach to economic statecraft.
Economic Statecraft: The Need for an Integrated Approach by Hoover Institution
Cite This Essay:
H.R. McMaster and Andrew J. Grotto. “Economic Statecraft: The Need for an Integrated Approach.” Hoover Institution. March 2025.
About the Authors
H.R. McMaster is the Fouad and Michelle Ajami Senior Fellow at the Hoover Institution. He is also the Bernard and Susan Liautaud Fellow at the Freeman Spogli Institute and lecturer at Stanford University’s Graduate School of Business. He was the twenty-sixth assistant to the president for national security affairs.
Andrew J. Grotto is a visiting fellow at the Hoover Institution. He founded and codirects the Program on Geopolitics, Technology, and Governance at Stanford University and serves as the faculty lead for the Cyber Policy and Security specialization within Stanford’s Ford Dorsey Master’s in International Policy Program. Grotto has held senior-level national security positions in Democratic and Republican administrations.
