Testing Assumptions About US Foreign Policy in 2026
Members of the Reimagining US Grand Strategy team and other Stimson programs examine key assumptions about U.S. foreign policy that will be tested this year
There are major unknowns facing U.S. foreign policy in 2026, stemming from both enduring challenges and recent developments. Issues including the future of U.S. alliances, the war in Ukraine, relations with China, and conflict mediation with Iran will all test the United States and its policymakers. Members of the Reimagining US Grand Strategy team — joined by colleagues from other Stimson programs — examined assumptions that they believe are central to U.S. foreign policy, and which are likely to be tested in 2026. Each author identifies a core element of the conventional wisdom and then assesses whether that prevailing view holds up, or whether policymakers should recalibrate their approach in light of new realities.
For the third year in a row, members of the Reimagining US Grand Strategy team took part in a whiteboarding exercise to identify common Washington assumptions about foreign policy that they believe may be tested in 2026.
Before diving in, however, it’s worth asking how last year’s predictions, written in January 2025, held up through a roller coaster year for U.S. foreign policy.
A few of our assessments proved remarkably foresighted. Kelly Grieco’s forecast – that Ukraine would continue to need some Western weapons supplies but can sustain a defensive posture against Russia – largely predicted the course of the war over the last year. Despite the withdrawal of direct American aid, European states have continued to supply Ukraine with supplies sufficient for a grinding, defensive fight. James Siebens’ assessment that the administration would find it difficult to sustain a high-level focus on great power competition has been confirmed by the National Security Strategy. Chris Preble and Aude Darnal predicted last year that the legacies of the War on Terror would continue to be felt at home and abroad; from Minnesota to Nigeria, that has been shown to be tragically accurate. And MacKenna Rawlins, who argued that the administration would find it difficult to sustain a lengthy trade war with China in the face of public discontent and cost-of-living concerns, accurately predicted many of the interlocking pressures the Trump administration is facing today.
Other assessments were partially correct. Evan Cooper argued that international institutions might survive and even thrive in the absence of the United States. The Trump administration has decimated America’s membership in international institutions throughout 2025, and while many continue to thrive, others such as the United Nations appear to be on the ropes. Meanwhile, Julia Gledhill’s argument – that acquisition reform would not fully fix the Pentagon – was simply not tested in 2025; the administration has not made reform a priority, choosing to focus instead on fitness standards and dress code.
There were several cases where we swung and missed. My own argument, for example, that the United States would likely be content with increased concessions from other states when it came to Panama, Greenland, and elsewhere without seeking actual annexation of territory has been proven wrong by Donald Trump’s continuing fixation on ownership. Barbara Slavin and Will Smith, meanwhile, made a perfectly plausible argument about diplomatic paths forward on Iran’s nuclear program – but failed to foresee Donald Trump’s willingness to use military force, even in the absence of a clear path to denuclearization. For 2026, we have once again assembled a set of conventional wisdoms that prevail in Washington and that we believe may be tested in the coming year. Will these assumptions be disproven this year? Check in again in January 2027.
Assumption: American attempts to obtain Greenland in 2026 will seriously damage NATO
Emma Ashford
Perhaps the most bizarre crisis of early 2026 has been the ongoing tensions between Washington and Copenhagen over the territory of Greenland. President Donald Trump has been quite forthcoming: He views the territory as necessary for U.S. national security and intends to buy or seize it from Denmark. The Danes have been equally insistent that the territory is neither for sale, nor for conquest. Tensions came to a head in January, as European states sent troops to joint exercises in Greenland. Though these troop deployments were minimal – Finland, for example, sent two soldiers – they were clearly intended as a signal to the United States of European resolve, and were viewed negatively in Washington. Ultimately, in his speech at the World Economic Forum in Davos, Donald Trump announced that he would not be using military means to obtain Greenland, but he continues to seek other avenues for acquisition.
The whole incident has led observers to wonder whether the standoff on Greenland might sound the death knell for NATO — and the broader transatlantic alliance. French president Emmanuel Macron’s speech at Davos explicitly rejected “the law of the strongest,” and called for Europeans to resist “vassalization and bloc politics.”
Despite these strong words, however, European leaders continue to be remarkably willing to appease Donald Trump rather than confront him. The European Commission, for example, was prepared to impose retaliatory tariffs on the United States in the summer of 2025; EU member states instead insisted on a sweetheart trade deal for the United States to avoid risking the security relationship. Donald Trump’s intervention in Venezuela, meanwhile, resulted in a series of anemic statements from European leaders about how bad Maduro was rather than criticism of the intervention on international law or sovereignty grounds.
Even on the issue of Greenland itself, there has been controversy. NATO Secretary General Mark Rutte’s efforts to offer Trump concessions at Davos were met with consternation and angry questions in the European parliament. Throughout the last year, and even during Trump’s first term, an inclination to preserve the transatlantic alliance has tended to predominate whenever European countries consider actually standing up to Donald Trump.
Greenland is also not the only problem in the transatlantic alliance. European leaders have agreed to increased defense spending in order to preserve the alliance, in line with the Trump administration’s emphasis on burden-sharing. But it’s far less clear how many of these countries will meet the spending targets in practice – or what Donald Trump’s response may be when it becomes obvious in a year or two that they are not intending to do so. Then there are the political issues that surfaced after Vice President JD Vance’s speech at the Munich Security Conference last year, and which were emphasized in the National Security Strategy. The Trump administration continues to build ties with far-right parties in Europe and is clearly seeking conservative policy change on the continent. If this pursuit begins to rise to the level of violating sovereignty, it will be increasingly difficult for European governments to ignore. Finally, there are trade questions at play. European leaders are increasingly reaching out to Beijing, New Delhi, and Latin America to build the trade ties that they may be losing with the United States. Such moves are extremely unpopular in the White House, with the president referring to trade with Beijing as “dangerous” for European governments.
In short, it’s likely a red herring to suggest that Greenland is the paramount issue determining the future of the transatlantic relationship. One could easily envision a scenario in which Denmark is pressured by other European states to make concessions simply to sustain the U.S. military presence in Europe. Equally, one could envision a plausible scenario in 2026 in which existing tensions on other issues render the specific question of Greenland moot.
Greenland instead is emblematic of broader problems in the transatlantic alliance. 2026 may well tell us whether European leaders can sustain an increasingly difficult balancing act: maintaining Europe’s US-led security architecture while resisting or pushing back on the Trump administration’s policies in other areas.
Assumption: Trump’s personalist approach to negotiations will secure lasting diplomatic agreements in 2026
Trump’s opening letter to the 2025 National Security Strategy asserts that his administration has “settled eight raging conflicts.” This is incorrect: Some were not actual conflicts, many have not been “solved,” and Trump has played little to no role in those that have achieved some resolution. Still, Trump and his backers have promoted the idea of him as a peacemaker, arguing that his form of “unconventional” diplomacy can secure lasting, beneficial deals for the United States and resolve protracted conflicts. But because of the limits of Trump’s style of diplomacy and his growing reliance on the use of force, 2026 is unlikely to yield grand, transformative agreements.
Trump’s style of diplomacy is personalistic, centered on bilateral negotiations led either by Trump himself or a high-level emissary, most often Special Envoy Steve Witkoff. This approach leads to many proclaimed agreements, from ceasefires to trade agreements, which depend on Trump’s word rather than the backing of durable, mutually agreed-upon contracts between parties. While this style allows negotiations to move quickly, it is fundamentally dependent on Trump’s whims rather than on enforceable and stable points of acknowledged mutual agreement. For example, his tendency to say that his requirements to remove tariffs have been met, only to threaten to reapply tariffs later, leaves countries unsure of issue linkages and what the U.S. negotiating position is.
Where the Trump administration has acted as a mediator, the process has been hurried and produced flimsy results. The Gaza ceasefire, Trump’s most touted diplomatic success, has not led to a cessation of Israeli attacks, and there is not yet a viable pathway for governance of Gaza. Trump has given himself the power to directly oversee the Gaza plan with his new “Board of Peace,” which raises a multitude of questions about the board’s institutional capacity, the interests and capabilities of those serving on the board, and the legitimacy of the nascent organization. The ability of the president to act as a steward of such a complex deal through this institution while managing domestic upheaval and a slate of other foreign policy issues is inherently limited. Turning control over to others, whether trusted aides or foreign partners, risks weakening the authority of the ceasefire.
Trump’s limited capacity to administer peace agreements is not the only threat to his ability to act as a peacemaker — his increased reliance on the use of force also imperils diplomatic efforts. While Trump appeared more hesitant to employ military coercion in his first term, the strikes against Iran and the seizure of Nicolas Maduro signal a notable shift away from the diplomatic tool over the past year. This does not preclude Trump from using diplomacy, particularly when acting as a third-party negotiator. But an increasingly bellicose foreign policy will curtail opportunities for diplomacy, and countries will be hesitant to engage in goodwill negotiations if they believe talks are merely the prelude to military action, as was the case with both Iran and Venezuela. Although threats to use force can lead to talks, as seen in European efforts to dissuade Trump from attempting to invade Greenland, they are unlikely to yield more than short-term assurances aimed at forestalling further coercion.
What Trump can manage to do through this style of diplomacy is rapidly change relationships with countries. He is far less beholden to bureaucratic inertia, both because of his lack of concern for the views of the establishment and because he has eliminated a large portion of the diplomatic bureaucracy. Trump can use upcoming summits with China’s Xi Jinping to chart a new course for US-China relations, but it would be mistaken to assume that any concrete elements of an agreement will actually be implemented by the Trump administration. The Trump administration is likely to put forward plenty of concepts of diplomatic agreements in 2026, along with significant blustering and potentially more uses of force. But these agreements are unlikely to stand the test of time and will leave the United States outside of broader international cooperation.
Assumption: Conditional, Transactional U.S. Commitments Will Spur Burden Shifting in Asia
At the Reagan National Defense Forum in December 2025, Defense Secretary Pete Hegseth delivered a shot across the bow to America’s allies. Decades of U.S. foreign policy, he argued, had “turned allies into dependents,” leaving Washington to “subsidize their defense with U.S. taxpayer dollars.” To remedy this, U.S. security commitments would now be conditioned on allied burden sharing, forcing partners to choose between investing in their own defense or risking reduced American support.
The administration formalized this approach in the 2025 National Security Strategy, promising “more favorable treatment on commercial matters, technology sharing, and defense procurement” for allies willing to shoulder greater defense burdens. The 2026 National Defense Strategy went further, asserting that “incentives work and will be a critical part of our alliance policy” and committing to “prioritize cooperation and engagement with model allies” — those that meet defense spending targets and assume a greater role in deterring regional threats — while providing “critical but limited U.S. support.”
The strategy assumes that conditional U.S. commitments will push allies to shoulder more of their own defense, ultimately reducing the burden on U.S. forces. Testing that assumption in 2026 requires examining not only whether allies spend more on defense but also how they spend it. If success is measured solely by higher defense budgets, conditionality is likely to succeed. However, if the standard is whether allies move toward an ally-first approach, gradually becoming the primary defender while the United States plays a supporting role, the results are likely to be more mixed.
Meaningful burden-shifting would require allies to develop denial-based capabilities that strengthen deterrence and defense. Japan, for example, would focus on mines, coastal defenses, anti-ship missiles, air and missile defense, and uncrewed systems for intelligence, surveillance, and reconnaissance (ISR), serving as the primary security actor in the East China Sea. The Philippines would emphasize coast guard vessels, shore-based anti-ship and anti-air missiles, and uncrewed air and maritime systems to counter Chinese gray-zone operations. Australia would focus on Pacific defense rather than expeditionary power projection, relying on coastal defenses, smaller surface combatants, and maritime patrol aircraft. South Korea would lead Peninsula defense by assuming wartime operational control and investing in counter-battery systems, layered missile defense, and hardened command-and-control structures. Together, these investments would create a clear division of labor, require limited U.S. integration, and allow allies to shoulder operational burdens early in a crisis, giving the United States time to surge forces if needed.
Instead, current trends suggest allies are responding to conditionality by investing in high-end, predominately American-made power-projection systems designed to deepen interoperability with U.S. forces. Take Japan as an example. Although Tokyo reached its 2% of GDP defense spending target two years ahead of schedule, its current defense budget prioritizes long-range strike capabilities, such as Tomahawk cruise missiles, upgraded Type-12 missiles, F-35 fighter jets, sixth-generation fighter development, hypersonic weapons, and submarine-launched missiles — totaling roughly $6.4 billion. By contrast, Japan’s coastal defense program centered on uncrewed littoral denial systems will receive just $660 million this fiscal year.
The story is similar with other U.S. allies. Australia’s defense spending is slowly rising toward 2.4% of GDP by 2033-34, but most new funding is slated for AUKUS nuclear-powered submarines and sustaining existing power-projection platforms, not coastal defense or smaller surface combatants. South Korea plans an 8.2% spending increase to $47.6 billion for 2026, prioritizing long-range air-to-air missiles and KF-21 fighter development even as the transfer of wartime operational control still has a way to go. The Philippines will raise defense spending by 16% to $5.2 billion this year, but despite acquiring BrahMos coastal defense missiles, a far larger share of funding supports multirole fighters, airborne early warning aircraft, aerial refueling tankers, and blue-water navy platforms.
These choices reflect how allies rationally respond to conditional commitments when incentives reward defense spending totals rather than operational responsibility. When U.S. guarantees become contingent, allies compete to secure continued American backing. With the Trump administration fixated on defense spending figures, that competition has become channeled toward billion-dollar contracts and power-projection capabilities that quickly inflate budgets. The result is higher allied spending and improved interoperability — but little meaningful reduction in U.S. operational demands.
Making U.S. security guarantees more explicitly conditional is not the problem itself. The problem is what those conditions reward. Instead of tying favorable treatment to spending levels alone, Washington should explicitly prioritize denial-based investments and allied-led regional defense. That means directing technology transfer, procurement cooperation, and intelligence sharing toward allies developing indigenous capabilities for local defense rather than big-ticket, headline-grabbing power-projection platforms designed by the United States. Only then can higher allied defense spending translate into genuine burden shifting, rather than a more expensive form of dependency.
Assumption: The US-China trade détente will hold through 2026
In October 2025, after nine months of turbulence that saw escalating reciprocal tariffs and export controls designed to cause maximum disruption, Trump and Chinese leader Xi Jinping met in Busan to come to a truce. The meeting eased key pressure points, with the promise of further negotiations in anticipation of additional summits in 2026.
The trade war of 2025 was not a boon for either the U.S. or Chinese economy, and the October 2025 meeting could be read as a mutual set of white flags, a shared desire to return to a more normal baseline. Both sides revealed the strongest cards in their hands: China demonstrated the extent to which it can weaponize rare earths exports, and the United States doubled down on its resolve to block China’s access to advanced computing technologies. Now that both sides know the risks of an escalating trade war, it is tempting to assume that a period of détente to facilitate negotiations is preferable to a downward spiral. So far, that logic has prevailed. Following the Busan meeting, Beijing agreed to pause some of its rare earth export controls for a year, and Washington permitted the export of certain less advanced Nvidia semiconductors to China. Yet most experts in Washington remain wary of the durability of this truce — and rightly so.
The deeper geopolitical tensions that undergird the fundamental mistrust and volatility in the bilateral relationship remain. Beijing and Washington have been careful in deciding when to breach the sensitive topics of Taiwan and the South China Sea, which were omitted from the trade-focused October 2025 meeting. But those issues have hardly disappeared. During a February call in the wake of an $11 billion U.S. arms sale to Taiwan, Xi warned Trump to exercise “caution” regarding support for Taiwan. The discussion of Taiwan in the call is a signal that while the truce may paper over trade disagreements in the short term, strategic competition is unabated and remains the dominant factor in the stability of the relationship.
But even holding such flashpoint issues steady is not enough to guarantee smooth sailing for the trade détente. China has technically met its trade truce promise regarding purchases of U.S. soybeans, but those purchases were made by state-owned buyers. Most Chinese soybean importers continue to turn to cheaper Brazilian alternatives. This reinforces the limited nature of the truce: It functions as a stopgap to create political space, not as a foundation for a longer-term economic arrangement. Tougher negotiations, such as reducing tariffs to make Chinese and U.S. goods competitive in each other’s markets again, remain unresolved. And a future deal may not pan out. The first US-China trade war, during Trump’s first term, ended with a deal dragged over the finish line in early 2020 for China to increase its purchases of U.S. exports in exchange for lower tariffs. Faced with uncertainty over Trump’s reelection prospects in 2020, China met only 58% of its commitments to buy additional U.S. goods under the Phase One trade deal, and talks for the planned second phase fizzled.
The specter of further tariff fluctuations also looms behind the détente. Trump’s affinity for tariffs is one of the few predictable aspects of his foreign policy. He views them as an effective means of coercion and industrial protection, downplaying the impact of higher costs on domestic businesses and consumers. If he decides to increase tariffs on Chinese goods again for strategic or political reasons, Washington and Beijing could quickly slip back to the tit-for-tat tariff cycle that defined much of 2025. Agreements to pause tariffs in 90-day increments paved the way to the October 2025 meeting, so any hikes in tariffs could roll negotiations back to square one.
Finally, Trump may be tempted to escalate tensions in his typical high-pressure approach to negotiations. Tariffs are one tool, but there are others available, such as increased demands for Chinese purchases of U.S. products. The ability to show his supporters a concrete success through his personal dealmaking is more important for Trump than whether the escalation is effective or necessary. Even if the road to the April meeting is relatively straight and smooth, Trump may decide to ramp up pressure in the interval before subsequent meetings with Xi, particularly in the runup to the November 2026 elections.
Despite the mutual pain inflicted by the trade war, any talks between Washington and Beijing will remain vulnerable to disruption caused by strategic competition as well as the political forces driving short-term trade maneuvers. Even a formalized trade deal may prove fragile if underlying tensions in the bilateral relationship flare up, and the weaponization of key exports — rare earths and advanced semiconductors — remains close to hand.
Assumption: Foreign policy will not affect the midterms
As a foreign policy analyst, it is a smart (and self-interested) career choice to proclaim that the foreign policy of this administration will affect whether the Democrats retake the House or the Senate in the 2026 midterms. However, the commonly held assumption is that foreign policy rarely impacts congressional elections. I believe that assumption is true.
Foreign policy may have a role, but it will play second fiddle to a variety of domestic policy issues. For example, in the 2024 election, the foreign policy of the Biden administration did have a role, but it was not so much in changing voters’ minds as affecting turnout (or lack thereof). Yet, even with two wars dominating news cycles, a Pew Research poll found that over 8 in 10 Americans stated the economy as the most important issue in the 2024 election. The same poll ranked foreign policy as the fourth most salient issue.
More recent polling likewise shows a concern with current foreign policy as 56% of Americans believe that the president has “gone too far” in using military interventions. But, for better or for worse, Congress has largely abdicated its role in foreign policy decision-making after September 11, and it has been especially reticent to exercise its authority during this administration. It is doubtful that Americans upset with recent foreign policies will use their votes to punish legislators – after all, the President is not up for re-election.
Perhaps the last time foreign policy issues played a major role in midterm elections was in 2006. Much has changed since then. For one, the 2006 midterm was held while the United States was actively engaged in a drawn-out conflict, which is not true in 2026. As Trump’s advisors and supporters have emphasized, he has employed surgical air strikes and special operations to avoid replicating the same regime change wars Americans grew wary of. While the electorate is starting to sour on foreign interventions, I’m not entirely convinced one-off uses of airpower will be an issue that drives folks to the polls.
Furthermore, the political map has changed drastically in the last two decades. In 2006, North and South Dakota both had Democratic members of Congress, which is nearly unfathomable today. The last 20 years have ushered in a zeitgeist of “culture wars,” an increase in gerrymandering, and a deepening of socio-economic divides. Any one of these societal fractures is arguably easier for an aspirational candidate to exploit than trying to run on a more nuanced policy – like NATO spending, the details for peace in Gaza, or tariffs.
Democrats and independents – especially those in the foreign policy field – have been outraged about the foreign policy of the Trump administration. And yet, there’s far greater ire for his domestic agenda. At the time of writing this piece, two civilians have been killed in Minneapolis by ICE officials, and 59% of the electorate now believes that immigration enforcement has “gone too far.” Recent polling also shows the top issues for Americans to be the economy, healthcare, and immigration.
Of course, foreign policy might play a role as one of the many instances in which the administration overplays its hand and uses awesome power flippantly. This administration’s overbearing (and often violent) foreign policy is unlikely to change — but the same is true of its domestic agenda. One can credibly assume that, come November, voters will be more focused on the aggression at home.
Assumption: Short, sharp strikes can deliver lasting strategic gains
Contrary to some expectations, the Trump administration has been quite willing to intervene across the globe. The administration has repeatedly turned to short, sharp uses of military force — most notably in Iran and Venezuela. Vice President JD Vance articulated this “Trump doctrine” as follows: “When you can’t solve [a problem] diplomatically, you use overwhelming military power to solve it and then you get the hell out of there before it ever becomes a protracted conflict.”
For some analysts, this approach offers a path out of the United States’ foreign policy malaise. They argue that the attacks quickly achieved major strategic goals, can be replicated across different contexts, and carry limited risk of entanglement or failure. In short, the “Trump doctrine” promises decisive results on the cheap.
Critics, however, have sounded the alarm about the risks of this model. Most importantly, they warn that even operationally successful strikes often fail to deliver lasting strategic results and risk escalation, protracted conflict, and dangerous second-order consequences.
The early results complicate both the strongest defenses and harshest critiques of this approach. The attacks on Iran and Venezuela did not lead to protracted conflicts, and they accomplished their immediate objectives. Still, this early record leaves open more consequential questions, ones that 2026 may begin to answer.
The core question facing the “Trump doctrine” is whether dramatic operational successes can deliver lasting strategic outcomes. The strikes on Iran’s nuclear program illustrate this uncertainty. There is little doubt that the attacks were tactically effective: Iran’s nuclear program was set back, and U.S. forces were unharmed. But the program was disrupted, not permanently dismantled. More concerningly from a strategic point of view, the strikes left the status of Iran’s nuclear material and activities uncertain, derailed diplomacy, and strengthened the case for weaponization among many in Tehran. Likewise, while the United States was able to swiftly capture Nicolás Maduro, the underlying regime structure remains intact, and Venezuela’s post-Maduro future is far from settled. In both cases, it remains unclear whether operational success will yield enduring gains.
These uncertainties can create pressure for follow-on action.As underscored by talk of another round of strikes on Iran, if force fails to produce a durable solution, the temptation to use it again grows. An attack intended as a one-off can easily slide into a pattern of “mowing the grass.”
A narrow focus on near-term wins also carries the risk of overconfidence. When he was asked after the Venezuela operation about the United States’ mixed record in ousting dictators, Trump responded, “With me, we’ve had a perfect track record of winning. We win a lot.” The administration’s recent rhetoric suggests a widening view of where U.S. power can be applied and confidence in these “in and out” attacks. Indeed, following the raid, Trump boasted that “we can do it again, too. Nobody can stop us.” So far, the U.S. military has been fortunate as well as skillful. But the Iran and Venezuela operations were conducted under permissive conditions — against relatively weak adversaries, with surprise, and with uncontested control of the skies. Future challenges may not offer such favorable conditions. The more heavily this approach is relied upon, the greater the risk of failure, casualties, or serious escalation.
Finally, operations like those in Iran and Venezuela also narrow the policy debate, drawing attention to the spectacle of military action rather than more fundamental — if less immediate — considerations. This can crowd out harder questions about whether a growing reliance on force risks eroding the diplomatic tool, further straining U.S. military resources, or normalizing intervention as a default. The ease with which force can be applied can make it harder to ask whether U.S. interests justified it in the first place.
The fact that these “hit-and-run” attacks have thus far avoided catastrophe does not mean they are a solution to every foreign policy problem. So far, the Trump administration has been able to achieve narrow objectives at low immediate cost. The administration clearly has a predilection for using force in this fashion, and it’s likely that 2026 will see more of these strikes. However, political blowback, unforeseen complications, and trade-offs might lead the administration to change course, as it did after the costly campaign against the Houthis showed no realistic prospect of success. What remains uncertain is whether those tactical gains translate into durable improvements to U.S. security, or whether they defer costs that will surface later.
Assumption: Americans must spend more on the military to be secure.
During the first week of January, President Donald Trump took to Truth Social to call for massive increases in the Pentagon’s budget. “Our Military Budget for the year 2027 should not be $1 Trillion Dollars, but rather $1.5 Trillion Dollars,” he exclaimed. “This will allow us to build the ‘Dream Military’ that we have long been entitled to and, more importantly, that will keep us SAFE and SECURE.” The following day, the respective chairs of the House and Senate Armed Services Committee enthusiastically agreed.
It is not too soon to predict, therefore, that 2026 will test the limits — if there are any — to the national security establishment’s ability to extract still more money out of the pockets of American taxpayers.
Trump’s enthusiasm for boosting Pentagon spending fits awkwardly with the National Security Strategy and National Defense Strategy, which both emphasize how U.S. allies must do more in their respective regions. The documents are equally clear that the United States has been involved in far too many foreign wars, and both call for narrowing the list of national security priorities. With this in mind, Americans could reasonably conclude that some of their tax dollars currently spent on the military would be redirected elsewhere, including to address domestic needs. But apparently not.
Notwithstanding the disconnect with the administration’s stated policy priorities, there are still other reasons to question the conventional wisdom that the Pentagon’s budget must grow. For one thing, such spending is notoriously wasteful. The Pentagon has so far escaped any serious reckoning — or even passed an audit. The past quarter-century has witnessed a host of weapons systems that have come in overbudget and behind schedule. Some of the most notable failures include the F-35 fighter aircraft, several high-profile Navy warships, and the Air Force’s Sentinel intercontinental ballistic missile. Trump’s Golden Dome will likely dwarf them all, with some estimates placing the cost at more than $3 trillion over the next 20 years. Oh, and it’s unlikely to work.
The actual beneficiaries of spending increases are the same legacy defense firms that have consistently failed to deliver for U.S. servicemen and women. A detailed study by William D. Hartung and Stephen Semler found that “between 2020 and 2024 … $771 billion in Pentagon contracts went to just five firms: Lockheed Martin ($313 billion), RTX (formerly Raytheon, $145 billion), Boeing ($115 billion), General Dynamics ($116 billion), and Northrop Grumman ($81 billion).”
More money won’t make this problem better. To be sure, a few scrappy start-ups will probably get a few billion dollars more, but expect Trump’s proposed increase to mostly go to the primes so they can continue building things we don’t need, for more than they promised, and deliver them late — or not at all. Downward pressure on its budget might force the Pentagon to rethink what it buys, and how it buys it.
Over four years of war, Ukraine’s leadership and its Western backers have consistently prioritized the preservation of the country’s territorial integrity. During the first year of fighting, the oft-stated objective was the restoration of full control over Ukraine’s internationally recognized 1991 borders. Over the past year, President Volodymyr Zelensky has gradually shifted his position, signaling a willingness to accept a ceasefire that would give Russia de facto control over the territories it currently occupies. Yet Kyiv and its supporters continue to categorically reject de jure recognition of new territorial realities.
The rejection of de jure recognition of new international borders rests on two core claims. The first is that refusing to legally recognize Russian control preserves the possibility of Ukraine regaining full territorial sovereignty in the future. This scenario relies on flawed historical analogies. For half a century, the West’s refusal to recognize the Soviet incorporation of the Baltic states brought no tangible results. When Estonia, Latvia, and Lithuania gained independence following the collapse of the Soviet Union, so too did the 12 other Soviet republics, whose status the West had never contested. Conversely, Germany peacefully reunified despite the Federal Republic of Germany and the German Democratic Republic having been widely recognized as separate states. In practice, the greatest factor determining the prospect of Ukraine regaining its 1991 borders is not external actors’ decisions concerning de facto or de jure recognition, but the persistence of the Russian regime and its legal claims to the territory it controls.
The second common contention holds that rewarding Russian aggression by legally ceding territory will encourage further military adventurism in Moscow and elsewhere. Yet non-recognition of Russia’s 2014 annexation of Crimea did not deter Russian leader Vladimir Putin from launching a far larger invasion in February 2022. Looking forward, the experience of four years of costly war is unlikely to incentivize similar gambles by Russia or other states. Even in the most consequential hypothetical case — a Chinese invasion of Taiwan — a change to the legal status of Russia’s western borders is a largely irrelevant precedent, as most of the world does not recognize a de jure territorial dispute between Beijing and Taipei in the first place.
In fact, the claim that de jure recognition will raise the risk of future conflict is in direct tension with the historical evidence, which suggests that territorial disputes are among the most common sources of interstate war. Even ostensibly “frozen” conflicts — such as those on the Korean Peninsula or in Cyprus — remain heavily militarized and vulnerable to escalation. By contrast, many borders originally established through force have become stable and peaceful once recognized and institutionalized.
In the specific context of Ukraine, de jure recognition of a new border would require both Kyiv and Moscow to adjust their constitutional claims to correspond to the territory they physically control. While Ukraine would cede territory within its internationally recognized 1991 boundaries, Russia would also have to accept a legal border short of the territory it has unilaterally annexed. Once established, mutual recognition of a new international border would likely yield substantial security benefits. First, it could facilitate reciprocal troop withdrawals, lowering the likelihood of inadvertent escalation. Second, any agreement that includes de jure recognition of the new border by the two sides’ key external partners would reduce the likelihood of essential foreign support for the aggressor in any future conflict. Third, formal recognition would lessen the resonance of political voices in both countries calling on their leaders to “finish the job.” Finally, settled borders in the East would make it possible for Ukraine to finally face West. Settled borders would simplify institutional alignment with European structures and make the country more attractive for badly needed large-scale private investment.
Maintaining the legal fiction of full territorial integrity risks trapping Ukraine in a state of perpetual uncertainty and insecurity. By formally recognizing the reality on the ground, Ukraine can reduce the risk of renewed conflict and accelerate the process of postwar reconstruction.
Assumption: Rapid development and full integration of AI is necessary to deter China
In 2026, there is no disruptive technology more ubiquitous than artificial intelligence, and the United States appears ready to accept it as the new centerpiece for its future defense operations. While announcing a new Artificial Intelligence Acceleration Strategy, Secretary of War Pete Hegseth claimed that the United States “will become an ‘AI-first’ warfighting force across all domains.”
Limited AI system use in the DoD is far from a new phenomenon, but the broader commercial AI boom has come alongside a renewed drive to incorporate the technology across the defense apparatus. The integration of AI-powered automation into capabilities like unmanned combat systems and digital targeting tools promises to be a significant force multiplier. However, adversaries like China that continue to develop increasingly capable AI systems are also poised to realize these military gains, stoking fear that the United States would face irreparable harm if rapid Chinese innovations in AI were to eclipse American capabilities. But this mix of fear and excitement may be encouraging unadulterated AI adoption that is ultimately counterproductive to the core U.S. military mission of deterrence.
One of the driving forces behind rapid AI development is the promise of autonomous vehicles and weapons systems, touted as critical due to their ability to reduce the risk that combat poses to U.S. military personnel while simultaneously expanding warfighting capabilities. U.S. Secretary of the Army Daniel Driscoll claims that AI-powered autonomous capabilities are essential against a similarly equipped adversary, predicting that, “artificial intelligence-driven, drone-on-drone fighting may be the future of the frontline.” While these tactical benefits may be true, lowered initial costs do not necessarily reduce risk or improve strategy. Making it easier to use lethal force also lowers the barrier to initiating or escalating conflict, potentially destabilizing situations that could have been managed with other tools. And even when major escalation does not follow, history has shown that “lower risk” tools do not ensure mission success. The Obama administration’s CIA-led drone campaign, for example, demonstrated how overvaluing “low-risk” combative tactics can deliver limited strategic returns. The campaign stoked the same sentiments that motivated the terrorist organizations it was attacking and limited the intelligence the United States could extract from targeted leaders. Truly autonomous systems are poised to deepen this dilemma, as there are fewer humans involved to question directives and less apparent blame to assign when things go awry.
Another concern with the broad adoption of AI is the risk that its complexity poses to operational effectiveness. While system sophistication can enable more complex missions, it also multiplies costs and points of failure. An F-35 grounded by software issues, for example, is less useful than a simpler, functional aircraft. AI-powered systems will suffer the same fate, potentially at an even higher rate, as the “black box” problem makes identifying failures in AI decision-making much more difficult. Moreover, should these core systems fail — whether through technical malfunction or adversary attack — overreliance on their support would leave the military with fewer experienced military personnel capable of stepping in.
Finally, the arms race mentality around AI encourages the rapid development of an unstable industrial base. Unlike China, the United States faces significant energy constraints in scaling new AI data centers. With limited long-term investment in renewable energy sources, the United States can only match Chinese capacity through the extraction (or seizure) of increasingly scarce fossil fuels or in the rushed development of nuclear energy infrastructure — both of which come with significant costs and risks. There is also concern surrounding the stability of commercial AI providers as the U.S. military increases its reliance on commercial products for more cost-effective modernization efforts. This is a risky dependence, as it relies on a subsect of the private sector that is widely believed to be propped up by rampant speculation and is often undercut by open-source alternatives produced by Chinese developers.
Despite these concerns, none of this is to suggest that AI has no role in the future of defense. There are and will continue to be new useful applications of AI, whether in enhanced unmanned systems, intelligence, cybersecurity, or elsewhere. The danger lies in accelerating AI development on a timeline that encourages overly expansive and risky adoption — with insufficient explanations of its strategic necessity — to compete with an adversary that is very far from posing a credible threat to the homeland.
Assumption: The European Union’s preferred ally will remain the United States
The United States often views itself as the European Union’s (EU) preferred ally, especially regarding weapons procurement. In the aftermath of World War II and the collapse of the Soviet Union, the United States enjoyed unparalleled economic and military capabilities relative to the rest of the world. This power differential enabled policymakers to secure U.S. economic interests, and those of allies, by defending access to global markets and raw materials in and around core regions. As a result, Washington and many of its European counterparts were incentivized to reinforce an international system centered upon economic integration and US-led security guarantees, rendering their interests not only compatible but seemingly indistinguishable.
Today, however, the emergence of stark disagreements between Washington and its European partners over negotiations to end the Russo-Ukrainian War and the American push to acquire Greenland has forced many policymakers abroad to recognize that the world order has changed, and that overdependence on any one state is no longer wise. Nowhere was this shift seen more clearly than in Canadian Prime Minister Mark Carney’s speech at the World Economic Forum, where he articulated the need for middle powers to collaborate on foreign policy issues independent of great-power influence. In a particularly pointed statement, Carney declared that “middle powers must act together because if we’re not at the table, we’re on the menu.” This call to action, combined with recent tensions between Washington and its European allies, raises questions about what U.S. partnerships will look like in the years ahead. Specifically, as Europe pursues greater strategic autonomy, a range of issue-specific partnerships with the EU will likely emerge, with Canada positioned as a leading partner.
Indeed, a closer look at Carney’s almost 11 months in office indicates that his efforts to derisk from the United States began long before his speech in Davos. By October 2025 — just eight months into his term — Carney had taken five trips to Europe, visiting a total of 11 countries and securing several foreign policy wins. Most notably, policymakers on both sides of the Atlantic announced the Canada-EU Security and Defence Partnership, a security framework that established the foundation for Canada’s involvement in the Security Action for Europe (SAFE). Established in May 2025, SAFE allocates up to $170 billion to support EU member states seeking to expand their defense industrial base. The low-interest loans provided through SAFE allow countries to make substantial investments in their militaries through common procurement, thereby cutting defense production costs and strengthening interoperability among states.
As the first non-European country to join SAFE, Canada and its domestic defense suppliers will gain privileged access to European markets while simultaneously attracting defense investments. The joint initiative comes at a moment of heightened tensions within the US-Canada security relationship. Ottawa is reconsidering Canada’s $19 billion commitment to purchase 88 F-35 fighters amid rising costs and political discord. At present, only 16 F-35s have been delivered, and Carney is reportedly considering an alternative offer for Sweden’s “Gripen” fighters. Canada’s hesitation to move forward with the 72 remaining F-35s signals a substantial shift in its foreign policy priorities — one that could even carry unintended consequences for the bi-national North American Aerospace Defense Command (NORAD).
While Canada explores alternative partnerships to support joint security initiatives, European policymakers may look to Ottawa not only as a preferred ally but also as a model for how to reduce reliance and derisk from a historically US-dominated security relationship. Furthermore, as Canada and the EU shift from close cooperation with Washington toward greater strategic autonomy, their interests will likely overlap more frequently as additional opportunities to collaborate emerge. This convergence could incentivize EU members and aligned partners to increasingly exclude the United States from similar defense procurement initiatives like SAFE. Consequently, American policymakers may face challenges in expanding demand for a U.S. defense industrial base already struggling to meet production targets.
Testing Assumptions About US Foreign Policy in 2026
By Emma Ashford • Evan Cooper • Kelly A. Grieco • Pamela Kennedy • Nevada Joan Lee • Alessandro Perri • Will A. Smith • Christopher Preble • Peter Slezkine • Hunter Slingbaum • Marie-Louise Westermann
Grand Strategy
There are major unknowns facing U.S. foreign policy in 2026, stemming from both enduring challenges and recent developments. Issues including the future of U.S. alliances, the war in Ukraine, relations with China, and conflict mediation with Iran will all test the United States and its policymakers. Members of the Reimagining US Grand Strategy team — joined by colleagues from other Stimson programs — examined assumptions that they believe are central to U.S. foreign policy, and which are likely to be tested in 2026. Each author identifies a core element of the conventional wisdom and then assesses whether that prevailing view holds up, or whether policymakers should recalibrate their approach in light of new realities.
Introduction: How last year’s predictions held up
Emma Ashford
Senior Fellow
For the third year in a row, members of the Reimagining US Grand Strategy team took part in a whiteboarding exercise to identify common Washington assumptions about foreign policy that they believe may be tested in 2026.
Before diving in, however, it’s worth asking how last year’s predictions, written in January 2025, held up through a roller coaster year for U.S. foreign policy.
A few of our assessments proved remarkably foresighted. Kelly Grieco’s forecast – that Ukraine would continue to need some Western weapons supplies but can sustain a defensive posture against Russia – largely predicted the course of the war over the last year. Despite the withdrawal of direct American aid, European states have continued to supply Ukraine with supplies sufficient for a grinding, defensive fight. James Siebens’ assessment that the administration would find it difficult to sustain a high-level focus on great power competition has been confirmed by the National Security Strategy. Chris Preble and Aude Darnal predicted last year that the legacies of the War on Terror would continue to be felt at home and abroad; from Minnesota to Nigeria, that has been shown to be tragically accurate. And MacKenna Rawlins, who argued that the administration would find it difficult to sustain a lengthy trade war with China in the face of public discontent and cost-of-living concerns, accurately predicted many of the interlocking pressures the Trump administration is facing today.
Other assessments were partially correct. Evan Cooper argued that international institutions might survive and even thrive in the absence of the United States. The Trump administration has decimated America’s membership in international institutions throughout 2025, and while many continue to thrive, others such as the United Nations appear to be on the ropes. Meanwhile, Julia Gledhill’s argument – that acquisition reform would not fully fix the Pentagon – was simply not tested in 2025; the administration has not made reform a priority, choosing to focus instead on fitness standards and dress code.
There were several cases where we swung and missed. My own argument, for example, that the United States would likely be content with increased concessions from other states when it came to Panama, Greenland, and elsewhere without seeking actual annexation of territory has been proven wrong by Donald Trump’s continuing fixation on ownership. Barbara Slavin and Will Smith, meanwhile, made a perfectly plausible argument about diplomatic paths forward on Iran’s nuclear program – but failed to foresee Donald Trump’s willingness to use military force, even in the absence of a clear path to denuclearization. For 2026, we have once again assembled a set of conventional wisdoms that prevail in Washington and that we believe may be tested in the coming year. Will these assumptions be disproven this year? Check in again in January 2027.
Assumption: American attempts to obtain Greenland in 2026 will seriously damage NATO
Emma Ashford
Perhaps the most bizarre crisis of early 2026 has been the ongoing tensions between Washington and Copenhagen over the territory of Greenland. President Donald Trump has been quite forthcoming: He views the territory as necessary for U.S. national security and intends to buy or seize it from Denmark. The Danes have been equally insistent that the territory is neither for sale, nor for conquest. Tensions came to a head in January, as European states sent troops to joint exercises in Greenland. Though these troop deployments were minimal – Finland, for example, sent two soldiers – they were clearly intended as a signal to the United States of European resolve, and were viewed negatively in Washington. Ultimately, in his speech at the World Economic Forum in Davos, Donald Trump announced that he would not be using military means to obtain Greenland, but he continues to seek other avenues for acquisition.
The whole incident has led observers to wonder whether the standoff on Greenland might sound the death knell for NATO — and the broader transatlantic alliance. French president Emmanuel Macron’s speech at Davos explicitly rejected “the law of the strongest,” and called for Europeans to resist “vassalization and bloc politics.”
Despite these strong words, however, European leaders continue to be remarkably willing to appease Donald Trump rather than confront him. The European Commission, for example, was prepared to impose retaliatory tariffs on the United States in the summer of 2025; EU member states instead insisted on a sweetheart trade deal for the United States to avoid risking the security relationship. Donald Trump’s intervention in Venezuela, meanwhile, resulted in a series of anemic statements from European leaders about how bad Maduro was rather than criticism of the intervention on international law or sovereignty grounds.
Even on the issue of Greenland itself, there has been controversy. NATO Secretary General Mark Rutte’s efforts to offer Trump concessions at Davos were met with consternation and angry questions in the European parliament. Throughout the last year, and even during Trump’s first term, an inclination to preserve the transatlantic alliance has tended to predominate whenever European countries consider actually standing up to Donald Trump.
Greenland is also not the only problem in the transatlantic alliance. European leaders have agreed to increased defense spending in order to preserve the alliance, in line with the Trump administration’s emphasis on burden-sharing. But it’s far less clear how many of these countries will meet the spending targets in practice – or what Donald Trump’s response may be when it becomes obvious in a year or two that they are not intending to do so. Then there are the political issues that surfaced after Vice President JD Vance’s speech at the Munich Security Conference last year, and which were emphasized in the National Security Strategy. The Trump administration continues to build ties with far-right parties in Europe and is clearly seeking conservative policy change on the continent. If this pursuit begins to rise to the level of violating sovereignty, it will be increasingly difficult for European governments to ignore. Finally, there are trade questions at play. European leaders are increasingly reaching out to Beijing, New Delhi, and Latin America to build the trade ties that they may be losing with the United States. Such moves are extremely unpopular in the White House, with the president referring to trade with Beijing as “dangerous” for European governments.
In short, it’s likely a red herring to suggest that Greenland is the paramount issue determining the future of the transatlantic relationship. One could easily envision a scenario in which Denmark is pressured by other European states to make concessions simply to sustain the U.S. military presence in Europe. Equally, one could envision a plausible scenario in 2026 in which existing tensions on other issues render the specific question of Greenland moot.
Greenland instead is emblematic of broader problems in the transatlantic alliance. 2026 may well tell us whether European leaders can sustain an increasingly difficult balancing act: maintaining Europe’s US-led security architecture while resisting or pushing back on the Trump administration’s policies in other areas.
Assumption: Trump’s personalist approach to negotiations will secure lasting diplomatic agreements in 2026
Evan Cooper
Research Analyst
Trump’s opening letter to the 2025 National Security Strategy asserts that his administration has “settled eight raging conflicts.” This is incorrect: Some were not actual conflicts, many have not been “solved,” and Trump has played little to no role in those that have achieved some resolution. Still, Trump and his backers have promoted the idea of him as a peacemaker, arguing that his form of “unconventional” diplomacy can secure lasting, beneficial deals for the United States and resolve protracted conflicts. But because of the limits of Trump’s style of diplomacy and his growing reliance on the use of force, 2026 is unlikely to yield grand, transformative agreements.
Trump’s style of diplomacy is personalistic, centered on bilateral negotiations led either by Trump himself or a high-level emissary, most often Special Envoy Steve Witkoff. This approach leads to many proclaimed agreements, from ceasefires to trade agreements, which depend on Trump’s word rather than the backing of durable, mutually agreed-upon contracts between parties. While this style allows negotiations to move quickly, it is fundamentally dependent on Trump’s whims rather than on enforceable and stable points of acknowledged mutual agreement. For example, his tendency to say that his requirements to remove tariffs have been met, only to threaten to reapply tariffs later, leaves countries unsure of issue linkages and what the U.S. negotiating position is.
Where the Trump administration has acted as a mediator, the process has been hurried and produced flimsy results. The Gaza ceasefire, Trump’s most touted diplomatic success, has not led to a cessation of Israeli attacks, and there is not yet a viable pathway for governance of Gaza. Trump has given himself the power to directly oversee the Gaza plan with his new “Board of Peace,” which raises a multitude of questions about the board’s institutional capacity, the interests and capabilities of those serving on the board, and the legitimacy of the nascent organization. The ability of the president to act as a steward of such a complex deal through this institution while managing domestic upheaval and a slate of other foreign policy issues is inherently limited. Turning control over to others, whether trusted aides or foreign partners, risks weakening the authority of the ceasefire.
Trump’s limited capacity to administer peace agreements is not the only threat to his ability to act as a peacemaker — his increased reliance on the use of force also imperils diplomatic efforts. While Trump appeared more hesitant to employ military coercion in his first term, the strikes against Iran and the seizure of Nicolas Maduro signal a notable shift away from the diplomatic tool over the past year. This does not preclude Trump from using diplomacy, particularly when acting as a third-party negotiator. But an increasingly bellicose foreign policy will curtail opportunities for diplomacy, and countries will be hesitant to engage in goodwill negotiations if they believe talks are merely the prelude to military action, as was the case with both Iran and Venezuela. Although threats to use force can lead to talks, as seen in European efforts to dissuade Trump from attempting to invade Greenland, they are unlikely to yield more than short-term assurances aimed at forestalling further coercion.
What Trump can manage to do through this style of diplomacy is rapidly change relationships with countries. He is far less beholden to bureaucratic inertia, both because of his lack of concern for the views of the establishment and because he has eliminated a large portion of the diplomatic bureaucracy. Trump can use upcoming summits with China’s Xi Jinping to chart a new course for US-China relations, but it would be mistaken to assume that any concrete elements of an agreement will actually be implemented by the Trump administration. The Trump administration is likely to put forward plenty of concepts of diplomatic agreements in 2026, along with significant blustering and potentially more uses of force. But these agreements are unlikely to stand the test of time and will leave the United States outside of broader international cooperation.
Assumption: Conditional, Transactional U.S. Commitments Will Spur Burden Shifting in Asia
Kelly Grieco
Senior Fellow
At the Reagan National Defense Forum in December 2025, Defense Secretary Pete Hegseth delivered a shot across the bow to America’s allies. Decades of U.S. foreign policy, he argued, had “turned allies into dependents,” leaving Washington to “subsidize their defense with U.S. taxpayer dollars.” To remedy this, U.S. security commitments would now be conditioned on allied burden sharing, forcing partners to choose between investing in their own defense or risking reduced American support.
The administration formalized this approach in the 2025 National Security Strategy, promising “more favorable treatment on commercial matters, technology sharing, and defense procurement” for allies willing to shoulder greater defense burdens. The 2026 National Defense Strategy went further, asserting that “incentives work and will be a critical part of our alliance policy” and committing to “prioritize cooperation and engagement with model allies” — those that meet defense spending targets and assume a greater role in deterring regional threats — while providing “critical but limited U.S. support.”
The strategy assumes that conditional U.S. commitments will push allies to shoulder more of their own defense, ultimately reducing the burden on U.S. forces. Testing that assumption in 2026 requires examining not only whether allies spend more on defense but also how they spend it. If success is measured solely by higher defense budgets, conditionality is likely to succeed. However, if the standard is whether allies move toward an ally-first approach, gradually becoming the primary defender while the United States plays a supporting role, the results are likely to be more mixed.
Meaningful burden-shifting would require allies to develop denial-based capabilities that strengthen deterrence and defense. Japan, for example, would focus on mines, coastal defenses, anti-ship missiles, air and missile defense, and uncrewed systems for intelligence, surveillance, and reconnaissance (ISR), serving as the primary security actor in the East China Sea. The Philippines would emphasize coast guard vessels, shore-based anti-ship and anti-air missiles, and uncrewed air and maritime systems to counter Chinese gray-zone operations. Australia would focus on Pacific defense rather than expeditionary power projection, relying on coastal defenses, smaller surface combatants, and maritime patrol aircraft. South Korea would lead Peninsula defense by assuming wartime operational control and investing in counter-battery systems, layered missile defense, and hardened command-and-control structures. Together, these investments would create a clear division of labor, require limited U.S. integration, and allow allies to shoulder operational burdens early in a crisis, giving the United States time to surge forces if needed.
Instead, current trends suggest allies are responding to conditionality by investing in high-end, predominately American-made power-projection systems designed to deepen interoperability with U.S. forces. Take Japan as an example. Although Tokyo reached its 2% of GDP defense spending target two years ahead of schedule, its current defense budget prioritizes long-range strike capabilities, such as Tomahawk cruise missiles, upgraded Type-12 missiles, F-35 fighter jets, sixth-generation fighter development, hypersonic weapons, and submarine-launched missiles — totaling roughly $6.4 billion. By contrast, Japan’s coastal defense program centered on uncrewed littoral denial systems will receive just $660 million this fiscal year.
The story is similar with other U.S. allies. Australia’s defense spending is slowly rising toward 2.4% of GDP by 2033-34, but most new funding is slated for AUKUS nuclear-powered submarines and sustaining existing power-projection platforms, not coastal defense or smaller surface combatants. South Korea plans an 8.2% spending increase to $47.6 billion for 2026, prioritizing long-range air-to-air missiles and KF-21 fighter development even as the transfer of wartime operational control still has a way to go. The Philippines will raise defense spending by 16% to $5.2 billion this year, but despite acquiring BrahMos coastal defense missiles, a far larger share of funding supports multirole fighters, airborne early warning aircraft, aerial refueling tankers, and blue-water navy platforms.
These choices reflect how allies rationally respond to conditional commitments when incentives reward defense spending totals rather than operational responsibility. When U.S. guarantees become contingent, allies compete to secure continued American backing. With the Trump administration fixated on defense spending figures, that competition has become channeled toward billion-dollar contracts and power-projection capabilities that quickly inflate budgets. The result is higher allied spending and improved interoperability — but little meaningful reduction in U.S. operational demands.
Making U.S. security guarantees more explicitly conditional is not the problem itself. The problem is what those conditions reward. Instead of tying favorable treatment to spending levels alone, Washington should explicitly prioritize denial-based investments and allied-led regional defense. That means directing technology transfer, procurement cooperation, and intelligence sharing toward allies developing indigenous capabilities for local defense rather than big-ticket, headline-grabbing power-projection platforms designed by the United States. Only then can higher allied defense spending translate into genuine burden shifting, rather than a more expensive form of dependency.
Assumption: The US-China trade détente will hold through 2026
Pamela Kennedy
Fellow
In October 2025, after nine months of turbulence that saw escalating reciprocal tariffs and export controls designed to cause maximum disruption, Trump and Chinese leader Xi Jinping met in Busan to come to a truce. The meeting eased key pressure points, with the promise of further negotiations in anticipation of additional summits in 2026.
The trade war of 2025 was not a boon for either the U.S. or Chinese economy, and the October 2025 meeting could be read as a mutual set of white flags, a shared desire to return to a more normal baseline. Both sides revealed the strongest cards in their hands: China demonstrated the extent to which it can weaponize rare earths exports, and the United States doubled down on its resolve to block China’s access to advanced computing technologies. Now that both sides know the risks of an escalating trade war, it is tempting to assume that a period of détente to facilitate negotiations is preferable to a downward spiral. So far, that logic has prevailed. Following the Busan meeting, Beijing agreed to pause some of its rare earth export controls for a year, and Washington permitted the export of certain less advanced Nvidia semiconductors to China. Yet most experts in Washington remain wary of the durability of this truce — and rightly so.
The deeper geopolitical tensions that undergird the fundamental mistrust and volatility in the bilateral relationship remain. Beijing and Washington have been careful in deciding when to breach the sensitive topics of Taiwan and the South China Sea, which were omitted from the trade-focused October 2025 meeting. But those issues have hardly disappeared. During a February call in the wake of an $11 billion U.S. arms sale to Taiwan, Xi warned Trump to exercise “caution” regarding support for Taiwan. The discussion of Taiwan in the call is a signal that while the truce may paper over trade disagreements in the short term, strategic competition is unabated and remains the dominant factor in the stability of the relationship.
But even holding such flashpoint issues steady is not enough to guarantee smooth sailing for the trade détente. China has technically met its trade truce promise regarding purchases of U.S. soybeans, but those purchases were made by state-owned buyers. Most Chinese soybean importers continue to turn to cheaper Brazilian alternatives. This reinforces the limited nature of the truce: It functions as a stopgap to create political space, not as a foundation for a longer-term economic arrangement. Tougher negotiations, such as reducing tariffs to make Chinese and U.S. goods competitive in each other’s markets again, remain unresolved. And a future deal may not pan out. The first US-China trade war, during Trump’s first term, ended with a deal dragged over the finish line in early 2020 for China to increase its purchases of U.S. exports in exchange for lower tariffs. Faced with uncertainty over Trump’s reelection prospects in 2020, China met only 58% of its commitments to buy additional U.S. goods under the Phase One trade deal, and talks for the planned second phase fizzled.
The specter of further tariff fluctuations also looms behind the détente. Trump’s affinity for tariffs is one of the few predictable aspects of his foreign policy. He views them as an effective means of coercion and industrial protection, downplaying the impact of higher costs on domestic businesses and consumers. If he decides to increase tariffs on Chinese goods again for strategic or political reasons, Washington and Beijing could quickly slip back to the tit-for-tat tariff cycle that defined much of 2025. Agreements to pause tariffs in 90-day increments paved the way to the October 2025 meeting, so any hikes in tariffs could roll negotiations back to square one.
Finally, Trump may be tempted to escalate tensions in his typical high-pressure approach to negotiations. Tariffs are one tool, but there are others available, such as increased demands for Chinese purchases of U.S. products. The ability to show his supporters a concrete success through his personal dealmaking is more important for Trump than whether the escalation is effective or necessary. Even if the road to the April meeting is relatively straight and smooth, Trump may decide to ramp up pressure in the interval before subsequent meetings with Xi, particularly in the runup to the November 2026 elections.
Despite the mutual pain inflicted by the trade war, any talks between Washington and Beijing will remain vulnerable to disruption caused by strategic competition as well as the political forces driving short-term trade maneuvers. Even a formalized trade deal may prove fragile if underlying tensions in the bilateral relationship flare up, and the weaponization of key exports — rare earths and advanced semiconductors — remains close to hand.
Assumption: Foreign policy will not affect the midterms
Nevada Joan Lee
Research Associate
As a foreign policy analyst, it is a smart (and self-interested) career choice to proclaim that the foreign policy of this administration will affect whether the Democrats retake the House or the Senate in the 2026 midterms. However, the commonly held assumption is that foreign policy rarely impacts congressional elections. I believe that assumption is true.
Foreign policy may have a role, but it will play second fiddle to a variety of domestic policy issues. For example, in the 2024 election, the foreign policy of the Biden administration did have a role, but it was not so much in changing voters’ minds as affecting turnout (or lack thereof). Yet, even with two wars dominating news cycles, a Pew Research poll found that over 8 in 10 Americans stated the economy as the most important issue in the 2024 election. The same poll ranked foreign policy as the fourth most salient issue.
More recent polling likewise shows a concern with current foreign policy as 56% of Americans believe that the president has “gone too far” in using military interventions. But, for better or for worse, Congress has largely abdicated its role in foreign policy decision-making after September 11, and it has been especially reticent to exercise its authority during this administration. It is doubtful that Americans upset with recent foreign policies will use their votes to punish legislators – after all, the President is not up for re-election.
Perhaps the last time foreign policy issues played a major role in midterm elections was in 2006. Much has changed since then. For one, the 2006 midterm was held while the United States was actively engaged in a drawn-out conflict, which is not true in 2026. As Trump’s advisors and supporters have emphasized, he has employed surgical air strikes and special operations to avoid replicating the same regime change wars Americans grew wary of. While the electorate is starting to sour on foreign interventions, I’m not entirely convinced one-off uses of airpower will be an issue that drives folks to the polls.
Furthermore, the political map has changed drastically in the last two decades. In 2006, North and South Dakota both had Democratic members of Congress, which is nearly unfathomable today. The last 20 years have ushered in a zeitgeist of “culture wars,” an increase in gerrymandering, and a deepening of socio-economic divides. Any one of these societal fractures is arguably easier for an aspirational candidate to exploit than trying to run on a more nuanced policy – like NATO spending, the details for peace in Gaza, or tariffs.
Democrats and independents – especially those in the foreign policy field – have been outraged about the foreign policy of the Trump administration. And yet, there’s far greater ire for his domestic agenda. At the time of writing this piece, two civilians have been killed in Minneapolis by ICE officials, and 59% of the electorate now believes that immigration enforcement has “gone too far.” Recent polling also shows the top issues for Americans to be the economy, healthcare, and immigration.
Of course, foreign policy might play a role as one of the many instances in which the administration overplays its hand and uses awesome power flippantly. This administration’s overbearing (and often violent) foreign policy is unlikely to change — but the same is true of its domestic agenda. One can credibly assume that, come November, voters will be more focused on the aggression at home.
Assumption: Short, sharp strikes can deliver lasting strategic gains
Alessandro Perri
Intern
Will A. Smith
Research Associate
Contrary to some expectations, the Trump administration has been quite willing to intervene across the globe. The administration has repeatedly turned to short, sharp uses of military force — most notably in Iran and Venezuela. Vice President JD Vance articulated this “Trump doctrine” as follows: “When you can’t solve [a problem] diplomatically, you use overwhelming military power to solve it and then you get the hell out of there before it ever becomes a protracted conflict.”
For some analysts, this approach offers a path out of the United States’ foreign policy malaise. They argue that the attacks quickly achieved major strategic goals, can be replicated across different contexts, and carry limited risk of entanglement or failure. In short, the “Trump doctrine” promises decisive results on the cheap.
Critics, however, have sounded the alarm about the risks of this model. Most importantly, they warn that even operationally successful strikes often fail to deliver lasting strategic results and risk escalation, protracted conflict, and dangerous second-order consequences.
The early results complicate both the strongest defenses and harshest critiques of this approach. The attacks on Iran and Venezuela did not lead to protracted conflicts, and they accomplished their immediate objectives. Still, this early record leaves open more consequential questions, ones that 2026 may begin to answer.
The core question facing the “Trump doctrine” is whether dramatic operational successes can deliver lasting strategic outcomes. The strikes on Iran’s nuclear program illustrate this uncertainty. There is little doubt that the attacks were tactically effective: Iran’s nuclear program was set back, and U.S. forces were unharmed. But the program was disrupted, not permanently dismantled. More concerningly from a strategic point of view, the strikes left the status of Iran’s nuclear material and activities uncertain, derailed diplomacy, and strengthened the case for weaponization among many in Tehran. Likewise, while the United States was able to swiftly capture Nicolás Maduro, the underlying regime structure remains intact, and Venezuela’s post-Maduro future is far from settled. In both cases, it remains unclear whether operational success will yield enduring gains.
These uncertainties can create pressure for follow-on action.As underscored by talk of another round of strikes on Iran, if force fails to produce a durable solution, the temptation to use it again grows. An attack intended as a one-off can easily slide into a pattern of “mowing the grass.”
A narrow focus on near-term wins also carries the risk of overconfidence. When he was asked after the Venezuela operation about the United States’ mixed record in ousting dictators, Trump responded, “With me, we’ve had a perfect track record of winning. We win a lot.” The administration’s recent rhetoric suggests a widening view of where U.S. power can be applied and confidence in these “in and out” attacks. Indeed, following the raid, Trump boasted that “we can do it again, too. Nobody can stop us.” So far, the U.S. military has been fortunate as well as skillful. But the Iran and Venezuela operations were conducted under permissive conditions — against relatively weak adversaries, with surprise, and with uncontested control of the skies. Future challenges may not offer such favorable conditions. The more heavily this approach is relied upon, the greater the risk of failure, casualties, or serious escalation.
Finally, operations like those in Iran and Venezuela also narrow the policy debate, drawing attention to the spectacle of military action rather than more fundamental — if less immediate — considerations. This can crowd out harder questions about whether a growing reliance on force risks eroding the diplomatic tool, further straining U.S. military resources, or normalizing intervention as a default. The ease with which force can be applied can make it harder to ask whether U.S. interests justified it in the first place.
The fact that these “hit-and-run” attacks have thus far avoided catastrophe does not mean they are a solution to every foreign policy problem. So far, the Trump administration has been able to achieve narrow objectives at low immediate cost. The administration clearly has a predilection for using force in this fashion, and it’s likely that 2026 will see more of these strikes. However, political blowback, unforeseen complications, and trade-offs might lead the administration to change course, as it did after the costly campaign against the Houthis showed no realistic prospect of success. What remains uncertain is whether those tactical gains translate into durable improvements to U.S. security, or whether they defer costs that will surface later.
Assumption: Americans must spend more on the military to be secure.
Christopher Preble
Senior Fellow and Director
During the first week of January, President Donald Trump took to Truth Social to call for massive increases in the Pentagon’s budget. “Our Military Budget for the year 2027 should not be $1 Trillion Dollars, but rather $1.5 Trillion Dollars,” he exclaimed. “This will allow us to build the ‘Dream Military’ that we have long been entitled to and, more importantly, that will keep us SAFE and SECURE.” The following day, the respective chairs of the House and Senate Armed Services Committee enthusiastically agreed.
It is not too soon to predict, therefore, that 2026 will test the limits — if there are any — to the national security establishment’s ability to extract still more money out of the pockets of American taxpayers.
Trump’s enthusiasm for boosting Pentagon spending fits awkwardly with the National Security Strategy and National Defense Strategy, which both emphasize how U.S. allies must do more in their respective regions. The documents are equally clear that the United States has been involved in far too many foreign wars, and both call for narrowing the list of national security priorities. With this in mind, Americans could reasonably conclude that some of their tax dollars currently spent on the military would be redirected elsewhere, including to address domestic needs. But apparently not.
Notwithstanding the disconnect with the administration’s stated policy priorities, there are still other reasons to question the conventional wisdom that the Pentagon’s budget must grow. For one thing, such spending is notoriously wasteful. The Pentagon has so far escaped any serious reckoning — or even passed an audit. The past quarter-century has witnessed a host of weapons systems that have come in overbudget and behind schedule. Some of the most notable failures include the F-35 fighter aircraft, several high-profile Navy warships, and the Air Force’s Sentinel intercontinental ballistic missile. Trump’s Golden Dome will likely dwarf them all, with some estimates placing the cost at more than $3 trillion over the next 20 years. Oh, and it’s unlikely to work.
The actual beneficiaries of spending increases are the same legacy defense firms that have consistently failed to deliver for U.S. servicemen and women. A detailed study by William D. Hartung and Stephen Semler found that “between 2020 and 2024 … $771 billion in Pentagon contracts went to just five firms: Lockheed Martin ($313 billion), RTX (formerly Raytheon, $145 billion), Boeing ($115 billion), General Dynamics ($116 billion), and Northrop Grumman ($81 billion).”
More money won’t make this problem better. To be sure, a few scrappy start-ups will probably get a few billion dollars more, but expect Trump’s proposed increase to mostly go to the primes so they can continue building things we don’t need, for more than they promised, and deliver them late — or not at all. Downward pressure on its budget might force the Pentagon to rethink what it buys, and how it buys it.
Such a rethink is long overdue. Indeed, we should be reimagining the entire defense enterprise, not shoveling hundreds of billions more into the Pentagon’s coffers.
So, the conventional wisdom — that Americans must spend more in order to be safe — deserves to be tested. And it likely will be in 2026.
Assumption: Legal recognition of Russian territorial gains is a non-starter
Peter Slezkine
Senior Fellow
Over four years of war, Ukraine’s leadership and its Western backers have consistently prioritized the preservation of the country’s territorial integrity. During the first year of fighting, the oft-stated objective was the restoration of full control over Ukraine’s internationally recognized 1991 borders. Over the past year, President Volodymyr Zelensky has gradually shifted his position, signaling a willingness to accept a ceasefire that would give Russia de facto control over the territories it currently occupies. Yet Kyiv and its supporters continue to categorically reject de jure recognition of new territorial realities.
The rejection of de jure recognition of new international borders rests on two core claims. The first is that refusing to legally recognize Russian control preserves the possibility of Ukraine regaining full territorial sovereignty in the future. This scenario relies on flawed historical analogies. For half a century, the West’s refusal to recognize the Soviet incorporation of the Baltic states brought no tangible results. When Estonia, Latvia, and Lithuania gained independence following the collapse of the Soviet Union, so too did the 12 other Soviet republics, whose status the West had never contested. Conversely, Germany peacefully reunified despite the Federal Republic of Germany and the German Democratic Republic having been widely recognized as separate states. In practice, the greatest factor determining the prospect of Ukraine regaining its 1991 borders is not external actors’ decisions concerning de facto or de jure recognition, but the persistence of the Russian regime and its legal claims to the territory it controls.
The second common contention holds that rewarding Russian aggression by legally ceding territory will encourage further military adventurism in Moscow and elsewhere. Yet non-recognition of Russia’s 2014 annexation of Crimea did not deter Russian leader Vladimir Putin from launching a far larger invasion in February 2022. Looking forward, the experience of four years of costly war is unlikely to incentivize similar gambles by Russia or other states. Even in the most consequential hypothetical case — a Chinese invasion of Taiwan — a change to the legal status of Russia’s western borders is a largely irrelevant precedent, as most of the world does not recognize a de jure territorial dispute between Beijing and Taipei in the first place.
In fact, the claim that de jure recognition will raise the risk of future conflict is in direct tension with the historical evidence, which suggests that territorial disputes are among the most common sources of interstate war. Even ostensibly “frozen” conflicts — such as those on the Korean Peninsula or in Cyprus — remain heavily militarized and vulnerable to escalation. By contrast, many borders originally established through force have become stable and peaceful once recognized and institutionalized.
In the specific context of Ukraine, de jure recognition of a new border would require both Kyiv and Moscow to adjust their constitutional claims to correspond to the territory they physically control. While Ukraine would cede territory within its internationally recognized 1991 boundaries, Russia would also have to accept a legal border short of the territory it has unilaterally annexed. Once established, mutual recognition of a new international border would likely yield substantial security benefits. First, it could facilitate reciprocal troop withdrawals, lowering the likelihood of inadvertent escalation. Second, any agreement that includes de jure recognition of the new border by the two sides’ key external partners would reduce the likelihood of essential foreign support for the aggressor in any future conflict. Third, formal recognition would lessen the resonance of political voices in both countries calling on their leaders to “finish the job.” Finally, settled borders in the East would make it possible for Ukraine to finally face West. Settled borders would simplify institutional alignment with European structures and make the country more attractive for badly needed large-scale private investment.
Maintaining the legal fiction of full territorial integrity risks trapping Ukraine in a state of perpetual uncertainty and insecurity. By formally recognizing the reality on the ground, Ukraine can reduce the risk of renewed conflict and accelerate the process of postwar reconstruction.
Assumption: Rapid development and full integration of AI is necessary to deter China
Hunter Slingbaum
Research Associate
In 2026, there is no disruptive technology more ubiquitous than artificial intelligence, and the United States appears ready to accept it as the new centerpiece for its future defense operations. While announcing a new Artificial Intelligence Acceleration Strategy, Secretary of War Pete Hegseth claimed that the United States “will become an ‘AI-first’ warfighting force across all domains.”
Limited AI system use in the DoD is far from a new phenomenon, but the broader commercial AI boom has come alongside a renewed drive to incorporate the technology across the defense apparatus. The integration of AI-powered automation into capabilities like unmanned combat systems and digital targeting tools promises to be a significant force multiplier. However, adversaries like China that continue to develop increasingly capable AI systems are also poised to realize these military gains, stoking fear that the United States would face irreparable harm if rapid Chinese innovations in AI were to eclipse American capabilities. But this mix of fear and excitement may be encouraging unadulterated AI adoption that is ultimately counterproductive to the core U.S. military mission of deterrence.
One of the driving forces behind rapid AI development is the promise of autonomous vehicles and weapons systems, touted as critical due to their ability to reduce the risk that combat poses to U.S. military personnel while simultaneously expanding warfighting capabilities. U.S. Secretary of the Army Daniel Driscoll claims that AI-powered autonomous capabilities are essential against a similarly equipped adversary, predicting that, “artificial intelligence-driven, drone-on-drone fighting may be the future of the frontline.” While these tactical benefits may be true, lowered initial costs do not necessarily reduce risk or improve strategy. Making it easier to use lethal force also lowers the barrier to initiating or escalating conflict, potentially destabilizing situations that could have been managed with other tools. And even when major escalation does not follow, history has shown that “lower risk” tools do not ensure mission success. The Obama administration’s CIA-led drone campaign, for example, demonstrated how overvaluing “low-risk” combative tactics can deliver limited strategic returns. The campaign stoked the same sentiments that motivated the terrorist organizations it was attacking and limited the intelligence the United States could extract from targeted leaders. Truly autonomous systems are poised to deepen this dilemma, as there are fewer humans involved to question directives and less apparent blame to assign when things go awry.
Another concern with the broad adoption of AI is the risk that its complexity poses to operational effectiveness. While system sophistication can enable more complex missions, it also multiplies costs and points of failure. An F-35 grounded by software issues, for example, is less useful than a simpler, functional aircraft. AI-powered systems will suffer the same fate, potentially at an even higher rate, as the “black box” problem makes identifying failures in AI decision-making much more difficult. Moreover, should these core systems fail — whether through technical malfunction or adversary attack — overreliance on their support would leave the military with fewer experienced military personnel capable of stepping in.
Finally, the arms race mentality around AI encourages the rapid development of an unstable industrial base. Unlike China, the United States faces significant energy constraints in scaling new AI data centers. With limited long-term investment in renewable energy sources, the United States can only match Chinese capacity through the extraction (or seizure) of increasingly scarce fossil fuels or in the rushed development of nuclear energy infrastructure — both of which come with significant costs and risks. There is also concern surrounding the stability of commercial AI providers as the U.S. military increases its reliance on commercial products for more cost-effective modernization efforts. This is a risky dependence, as it relies on a subsect of the private sector that is widely believed to be propped up by rampant speculation and is often undercut by open-source alternatives produced by Chinese developers.
Despite these concerns, none of this is to suggest that AI has no role in the future of defense. There are and will continue to be new useful applications of AI, whether in enhanced unmanned systems, intelligence, cybersecurity, or elsewhere. The danger lies in accelerating AI development on a timeline that encourages overly expansive and risky adoption — with insufficient explanations of its strategic necessity — to compete with an adversary that is very far from posing a credible threat to the homeland.
Assumption: The European Union’s preferred ally will remain the United States
Marie-Louise Westermann
Research Associate
The United States often views itself as the European Union’s (EU) preferred ally, especially regarding weapons procurement. In the aftermath of World War II and the collapse of the Soviet Union, the United States enjoyed unparalleled economic and military capabilities relative to the rest of the world. This power differential enabled policymakers to secure U.S. economic interests, and those of allies, by defending access to global markets and raw materials in and around core regions. As a result, Washington and many of its European counterparts were incentivized to reinforce an international system centered upon economic integration and US-led security guarantees, rendering their interests not only compatible but seemingly indistinguishable.
Today, however, the emergence of stark disagreements between Washington and its European partners over negotiations to end the Russo-Ukrainian War and the American push to acquire Greenland has forced many policymakers abroad to recognize that the world order has changed, and that overdependence on any one state is no longer wise. Nowhere was this shift seen more clearly than in Canadian Prime Minister Mark Carney’s speech at the World Economic Forum, where he articulated the need for middle powers to collaborate on foreign policy issues independent of great-power influence. In a particularly pointed statement, Carney declared that “middle powers must act together because if we’re not at the table, we’re on the menu.” This call to action, combined with recent tensions between Washington and its European allies, raises questions about what U.S. partnerships will look like in the years ahead. Specifically, as Europe pursues greater strategic autonomy, a range of issue-specific partnerships with the EU will likely emerge, with Canada positioned as a leading partner.
Indeed, a closer look at Carney’s almost 11 months in office indicates that his efforts to derisk from the United States began long before his speech in Davos. By October 2025 — just eight months into his term — Carney had taken five trips to Europe, visiting a total of 11 countries and securing several foreign policy wins. Most notably, policymakers on both sides of the Atlantic announced the Canada-EU Security and Defence Partnership, a security framework that established the foundation for Canada’s involvement in the Security Action for Europe (SAFE). Established in May 2025, SAFE allocates up to $170 billion to support EU member states seeking to expand their defense industrial base. The low-interest loans provided through SAFE allow countries to make substantial investments in their militaries through common procurement, thereby cutting defense production costs and strengthening interoperability among states.
As the first non-European country to join SAFE, Canada and its domestic defense suppliers will gain privileged access to European markets while simultaneously attracting defense investments. The joint initiative comes at a moment of heightened tensions within the US-Canada security relationship. Ottawa is reconsidering Canada’s $19 billion commitment to purchase 88 F-35 fighters amid rising costs and political discord. At present, only 16 F-35s have been delivered, and Carney is reportedly considering an alternative offer for Sweden’s “Gripen” fighters. Canada’s hesitation to move forward with the 72 remaining F-35s signals a substantial shift in its foreign policy priorities — one that could even carry unintended consequences for the bi-national North American Aerospace Defense Command (NORAD).
While Canada explores alternative partnerships to support joint security initiatives, European policymakers may look to Ottawa not only as a preferred ally but also as a model for how to reduce reliance and derisk from a historically US-dominated security relationship. Furthermore, as Canada and the EU shift from close cooperation with Washington toward greater strategic autonomy, their interests will likely overlap more frequently as additional opportunities to collaborate emerge. This convergence could incentivize EU members and aligned partners to increasingly exclude the United States from similar defense procurement initiatives like SAFE. Consequently, American policymakers may face challenges in expanding demand for a U.S. defense industrial base already struggling to meet production targets.
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