The sovereign at the lectern

CNBC reports that President Trump told the United Nations General Assembly that the United States will no longer permit threats 'to gain a foothold anywhere in the Western Hemisphere,' while simultaneously defending the growth of American artificial intelligence. It is a curious mixture — the boast of productive capacity paired with the language of hemispheric dominion — and it is precisely the mixture I spent my working life trying to untangle.

Let me begin with the productive boast, because it is the more hopeful element. If American enterprise is genuinely advancing the division of cognitive labor through new machinery — and I take it on inference that this is what 'AI growth' signifies — then the gains ought, under honest institutions, to flow broadly: to the consumer who pays less for a service, to the worker who is freed for tasks the machine cannot perform, and to the trading partner who benefits from the exchange. The wealth of a nation is not the gold in its treasury. It is the annual output of its land and labor and, I would now add, its ingenuity. A sovereign who understands this will encourage the exchange of such output freely, because every willing buyer and willing seller signals a mutual gain.

But the same address, per CNBC, pairs that boast with threats of exclusion — against Iran, against Cuba, against any power deemed a threat to hemispheric order. I do not dispute that a sovereign has duties of defense; I argued plainly in The Wealth of Nations that defense is the first obligation of the public purse, and that no market functions without the security that only a state can guarantee. The question is not whether to defend, but at what cost, and to whom the cost falls. When restriction is imposed in the name of security, it is almost always the ordinary consumer — the person who buys the sanctioned good, or who would have traded freely had the sovereign permitted it — who pays the hidden tax. The merchant who lobbies for the restriction rarely suffers it.

There is a further danger I must name, because I named it in my own century with respect to the great chartered companies. When a nation declares itself the arbiter of who may trade and who may not in an entire hemisphere, it begins to resemble less a sovereign under law and more a mercantile monopolist in political dress. The East India Company, in my day, held a charter that gave it coercive power over trade and, eventually, over territory. The results were ruinous — for the subject peoples, for honest commerce, and in the long run for the English consumer who paid higher prices for the privilege of subsidizing a private army. Hemispheric doctrines are not identical to chartered monopolies, but the institutional logic rhymes: a powerful actor uses political authority to restrict the field of exchange, and calls it security.

What, then, is the honest framework? Defense alliances grounded in treaty, transparent to the public and ratifiable by its representatives. Trade restrictions narrow, time-limited, and subject to judicial review — not proclaimed from a lectern as permanent hemispheric policy. And, critically, institutions at the international level — the very assembly being addressed — that give smaller nations a forum for grievance and a rule of law to appeal to, rather than the mere weight of the largest power's preference. I would note, with some humility, that I cannot assess the engineering of modern AI or the precise military balance in the Persian Gulf. But I can say this: the institutional question — what framework disciplines the exchange, and who bears the cost when it breaks down — is the same question it has always been. A speech that answers it only with the assertion of American will has not yet answered it at all.