The easiest way to misunderstand the Trump administration is to mistake the noise for the plot. The insults, tariff tantrums, cryptocurrency rackets, cabinet melodrama and television-ready cruelty draw attention to the circus tent.

The plot, meanwhile, has a price tag: $1.5tn for the freshly renamed Department of War, the largest defence budget in US history in nominal terms – and in real terms approaching the annual peak the country managed while fighting Hitler. It is being financed, with the elegant arithmetic of a man billing his own children, by trimming the parts of government that feed, school and treat them.

What that budget is supposed to buy is a structural transformation of the American state, its economy and its place in the global order. The post-cold war republic that called itself a free market is letting the mask slip. The machinery had been there all along – DARPA (Defense Advanced Research Projects Agency), In-Q-Tel (the CIA’s information technology investment fund), the national labs – what political economist Fred Block calls America’s ‘hidden developmental state’.

Washington now picks industries, sets prices, takes equity in private firms and conditions foreign aid on political loyalty without bothering to call it anything else. Cold war – and even post-cold war – vocabulary doesn’t fit any more: ‘military Keynesianism’ meant increasing defence spending to boost aggregate demand; ‘military neoliberalism’, the same thing routed through private contractors and deregulated supply chains. What’s happening now is allocative, not fiscal – deciding which firms should exist, at which prices, with which inputs, in which sectors. And the war that’s coming is economic, not physical: it will be fought on balance sheets, not battlefields.

Behind all this, obviously, is a fear of China, and the technology that has dragged every other priority into step behind it: artificial intelligence. None of the underlying problems – (…)

Full article: 3 211 words.

(1) David Graeber Institute, X, 8 May 2026.

(2) ‘Prime minister faces fight for survival after Labour’s local election “disaster” ’, Observer, London, 10 May 2026.

(7) Mason Boycott-Owen, ‘Tony Blair commends Keir Starmer and New Labour in advert ahead of local elections’, Telegraph, London, 2 May 2022.