Could the Greenland crisis force the government to speak up against US aggression, asks Catherine McGregor in today’s excerpt from The Bulletin.
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Tariff threats ricochet towards NZ
Europe’s threatened “trade bazooka” against the US over Greenland sounds like something out of a comic book, but the ricochet could be deadly serious for the rest of the world – even a small, trade‑dependent economy at the bottom of the globe. Trump’s latest tariff threats against Denmark and other European allies, and their readiness to retaliate, signal a deeper unravelling of the rules‑based trading order New Zealand has relied on for decades.
As Emma Gleason reports in The Spinoff this morning, for NZ exporters, the prospect of yet another tariff tit-for-tat brings with it fresh uncertainty over demand, prices and market access. For importers, meanwhile, they could mean higher costs for everything from machinery to consumer goods, amplified by volatile exchange rates. Economist Cameron Bagrie says those higher costs will ultimately be passed onto the consumer. As he bluntly puts it: “Prices on average will be higher under a less globalised model, which is where we’re heading.”
Reserve Bank governor gets another telling off
Trump’s escalating campaign against Federal Reserve chair Jerome Powell, now the subject of a Justice Department criminal probe over cost overruns on a US$2.5b Fed building renovation, has become an unlikely domestic flashpoint in Wellington. As the New York Times reports (paywalled), Powell is formally being targeted over whether he misled Congress about the refurbishments, which one Trump official termed the “Taj Mahal on the National Mall”. But the deeper issue is Trump’s anger at a central bank that refuses to slash interest rates to his timetable.
New RBNZ governor Anna Breman’s decision to sign a global letter backing Powell’s independence put New Zealand briefly on that battlefield, prompting foreign minister Winston Peters to last week admonish her to “stay in her New Zealand lane”. On Monday, finance minister Nicola Willis was more measured but still made her displeasure clear: “She should have let me know that that statement was her intention, and she should have taken advice from across government.”
Luxon weighs Trump’s ‘Board of Peace’ offer
Trump’s proposed “Board of Peace” for Gaza pulls New Zealand into even more uncomfortable terrain: the redesign of the entire global conflict‑management architecture. As RNZ reports, Luxon has been invited to be one of 60 world leaders on a Trump‑chaired body that would begin in Gaza and potentially expand to other conflicts, offering permanent seats to countries that stump up US$1b for the privilege. According to Reuters, diplomats and NGOs worry the board is being constructed as a Trump‑controlled alternative to the UN, sidelining the only institution where all states, big and small, are on an equal footing. Annalena Baerbock, president of the UN General Assembly, told Sky News the UN’s unique legitimacy lies in precisely that equality, warning that “if we question that … we fall back and very, very, dark, times.”
Speaking up or ducking down
Beneath all this runs a larger argument about how loudly New Zealand should defend the rules‑based order when Washington is abducting Venezuela’s president, threatening to annex Greenland and pulling out of dozens of international organisations. Geopolitics experts Robert Patman and Van Jackson tell Gleason that Trump’s foreign policy is explicitly geared to dismantling that order, replacing it with spheres of influence where smaller powers like New Zealand have little say. Jackson sketches a stark choice between continuing the softly‑softly approach or “muster[ing] a little backbone” and aligning more openly with countries “trying to preserve a semblance of stability and fairness”, even if that invites retaliation from a White House. In Newsroom, Jonathan Milne puts the question simply: “How much longer will Peters and his ministerial colleagues duck below the Pacific parapet as bullets fly around the world?”
