The Most Important Foreign Policy Speech in Years

Summary of The Most Important Foreign Policy Speech in Years

by New York Times Opinion

1h 14m•January 27, 2026
Listen to Episode

Overview of The Most Important Foreign Policy Speech in Years

This episode (New York Times Opinion / Ezra Klein) analyzes Mark Carney’s Davos speech—calling the present moment a “rupture, not a transition”—through a conversation with Johns Hopkins professor Henry Farrell. The discussion centers on how deep economic and technological integration has become a source of coercion (what Farrell and co-author Abe Newman call “weaponized interdependence”), how the United States has used financial and tech platforms as levers of power, and what that means for allies, global order, and possible responses (hedging, building alternatives, or deterrence).

Core themes

  • Weaponized interdependence
    • Integrated finance, payments, and tech platforms give states (especially the U.S.) leverage to coerce others by cutting or conditioning access (e.g., dollar-clearing, sanctions).
  • “Rupture” in the liberal international order
    • Carney argues the old bargain—U.S. hegemony in return for public goods and predictable restraint—is fracturing.
  • Inshittification of platforms and power
    • Borrowing Cory Doctorow’s term: infrastructures (dollar system, military platforms, internet services) initially deliver value but can be repurposed to extract value and control.
  • Hedging, decoupling, and the rising costs of dependence
    • Allies may diversify partners, build domestic alternatives, or form coalitions (Europe, Canada, Japan, Korea) to reduce vulnerability.
  • Political style and legitimacy
    • Trump-style transactionalism treats integration as tribute; this short-term coercion risks long-term erosion of trust and alliances.
  • Narratives and collective belief
    • Invocations of Václav Havel (the greengrocer) and Thucydides: power depends on coordination, reputation, and belief—hubristic coercion can produce strategic backlash.

Key examples and evidence discussed

  • Dollar-clearing and correspondent banking
    • Access to U.S. dollar markets forces international banks to comply with U.S. regulations and sanctions; losing access can cripple institutions/countries.
  • Sanctions on Iran
    • Demonstrates effective coercion of entire national economies by restricting banking and payments access.
  • Measures post-9/11 and against North Korea
    • Early uses of finance as a counterterror/pressure tool evolved into broader statecraft.
  • Trump’s sanctions/tactics
    • Sanctions on ICC officials; tariffs on Canada/Mexico; the Greenland episode as emblematic of transactional, destabilizing policymaking.
  • Tech/Platform dependency
    • Examples like Starlink/Elon Musk illustrate the political risk of relying on private U.S.-based digital infrastructure.
  • AI as the next contested infrastructure
    • U.S. leadership in AI could become another platform that creates dependencies exploitable for leverage.

Major takeaways and implications

  • The status quo is changing: allies can no longer assume automatic security/prosperity from U.S. alignment.
  • Weaponized interdependence is real and increasingly deliberate—financial plumbing and tech platforms are instruments of coercion.
  • Short-term transactionalism (tribute logic) can win immediate gains but undermines long-term trust and cooperation.
  • Responses by other states will be costly and imperfect: hedging between great powers, building independent platforms, or strengthening deterrence—all reduce efficiency and raise economic costs.
  • A fragmented, multipolar world is likelier if allies reduce dependence on the U.S. or China—or if the U.S. continues unpredictable coercion.
  • Political legitimacy and collective coordination matter: authoritarian coercion may impose costs but can be fragile if broad social consensus opposes it.

Notable quotes & formulations

  • Mark Carney (quoted): “We are in the midst of a rupture, not a transition.”
  • Carney: “You cannot live within the lie of mutual benefit through integration when integration becomes the source of your subordination.”
  • Farrell on the mechanism: dollar access = effective regulatory leverage over global banks.
  • Farrell/Doctorow concept: “inshittification” — platforms evolve from value-adding to extracting and coercive.
  • Carney’s warning: “Hegemons cannot continually monetize their relationships. Allies will diversify to hedge against uncertainty.”
  • Havel’s greengrocer anecdote (as used by Carney): public rituals of compliance can sustain unjust systems until public truth re-emerges.
  • Thucydides lesson reframed: apparent strength and impunity can become hubris that erodes hegemony.

Policy and practical recommendations (implicit in the discussion)

For allied governments and policymakers:

  • Hedge and diversify supply chains, payments infrastructure, and tech dependencies.
  • Invest in autonomous capabilities (critical minerals, domestic AI/tech, financial infrastructure) where feasible.
  • Strengthen coalitions of middle powers (Europe, Canada, Japan, South Korea) to create alternatives and insurance mechanisms.
  • Build resilient deterrents—political, economic, and military—to increase the cost of coercion.
  • Preserve or recreate credible norms and commitments to limit opportunistic use of leverage.

For listeners/analysts:

  • Watch developments in sanctions technology, export controls, and payment systems—these are frontline tools of statecraft.
  • Follow AI governance and platform geopolitics as potential arenas for new dependency/coercion dynamics.

Recommended further reading (from the episode)

  • Underground Empire: How America Weaponized the World Economy — Henry Farrell & Abraham Newman (core academic framing discussed)
  • Dollars and Dominion — Mary Bridges (history of U.S. financial hegemony)
  • Nonesuch — Francis Spufford (fiction/fable connecting economics and systems; recommended by Farrell)
  • The Score — Thi Nguyen (cultural/personal angles on systems, games, and meaning)

Bottom line

Carney’s Davos speech—framed by Farrell’s analysis—signals a growing consensus: deep integration is no longer purely a source of mutual gain but can be turned into a tool of coercion. That realization forces hard choices for allies: accept vulnerability and transactional exploitation, pay the price to build independent capabilities, or create new coalitions and deterrence measures. All options are costly; the global order is unlikely to revert to its previous form.