Team up to oppose them, don’t underestimate them, don’t appease them.
In his book Dealings with Dictators: A CEO’s Guide to Defending Democracy, author Mathias Döpfner observes that “the maxim of ‘change through trade’ has led to a macabre outcome that’s quite the opposite of the one intended: Instead of becoming more liberal, tolerant, and cosmopolitan through intensified business links with Western democracies, the world’s autocracies, like Russia and China, have become even more radical and undemocratic. So there has been ‘change through trade,’ but this change ended up weakening democracy rather than strengthening it and effectively led the West into a trade trap.”
Conversing with a Politico interviewer who does not seem to regard Donald Trump as among the friends of democracy, Döpfner doesn’t argue but elaborates his view that the United States should get together with the other relatively free democracies to set up a Freedom Trade Alliance (“ ‘If You Compromise With Totalitarian Systems, You Will Pay a High Price,’ ” Politico, January 18, 2025).
This alliance would consist of no barriers to trade among participating democracies, stiff tariffs for the non-democracies, like China.
Team up
“My main point is that, instead of trying to decouple unilaterally from China, let’s do it in an organized manner together. Let’s sit together at the negotiation table, because if 300 million Americans impose tariffs, that’s one thing. But if 300 million Americans plus 500 million Europeans and some of the largest economies in the world and other democracies from Japan to Australia are warm-heartedly invited to join, then I think we will have a much better outcome that is very much to the benefit of every non-authoritarian economy, but most importantly, for the U.S….
“I think what’s very important is that the criteria [for being included in the Freedom Trade Alliance] should be very basic. If the criteria are too ambitious, then it’s never going to work….
Get rid of WTO
“First of all, I think the WTO should cease operations. The WTO is a dysfunctional, bureaucratic colossus. It is de facto dysfunctional, because it is in a very kind of asymmetrical way benefiting China. And that’s why the U.S. has basically stopped its proactive involvement in the WTO. The best way is not to try to reform it, but to simply replace it, and then something should be created that looks much more like the old GATT [General Agreement on Tariffs and Trade] agreement, which was way more minimalistic, less bureaucratic, less ambitious, but much more functional. I think in that spirit of less is more and lean and fast, we could form that alliance….
No appeasement
“England and other countries underestimated the German aggression in the early years. The Holocaust and the terrible consequences and millions of casualties could have been avoided. The world underestimated the aggressor. The world put it basically on an equal level with imperfect democracies. And said, ‘No, he’s not going that far.’ But he [Hitler] did it. He did it all, and he did it just as he announced it. It’s better to take a dictator seriously. Take China seriously in their announcements with regard to Taiwan, take Putin seriously with regard to his announcements of not only Ukraine, but even going further….
“Let’s not underestimate the non-democratic aggressors. In every form, appeasement is wrong and is existentially dangerous. And there is military appeasement and political appeasement, but there is also business appeasement. We can avoid a dangerous escalation, but only if we act fast and if we use all the tools that we have.”
