Dear readers,

I’m delighted to share my cover essay in the new issue of Foreign Affairs, “How to Fight an Economic War.”

The global economy is being reshaped by two parallel processes: an economic arms race and a scramble for economic security. Governments are crafting new ways to weaponize their advantages while simultaneously defending against rivals’ economic weapons. The United States lacks a field manual for this new environment. For decades, it operated from a position of dominance, wielding economic leverage with little fear of retaliation. That world has passed. Today’s system is defined by mutual vulnerability and the growing importance of chokepoints.

In the essay, I lay out how to identify these chokepoints, how to use them effectively, and how to defend against others’ leverage without undermining the foundations of American economic power. I also explore how to manage escalation and what the proliferation of economic warfare means for the future of the global economic order.

This piece takes on several of the core questions we’re examining at the Greenberg Center for Geoeconomics. Below, you’ll also find additional analysis from the Center on China and artificial intelligence (AI), how the Iran war is accelerating the clean energy transition, and the future of the dollar. I welcome your thoughts. 

All best, 

Eddie

China and the United States are roughly level in the AI contest, and chip export controls have failed to change that. In pursuing an impossible objective, CFR Fellow Sebastian Mallaby argues in the New York Times, the United States is missing a more realistic opportunity: negotiating with China a global pact on AI safety. Read more

The blockage of the Strait of Hormuz is accelerating a global race toward solar, wind, and electric vehicles—and CFR Fellow David Hart argues that China, which dominates all three industries, is the clear winner. If future geopolitics are defined by a struggle between a Chinese electro-state and a U.S. petro-state, then the Iran war is a self-inflicted wound. Read more