U.S. Treasury Secretary Scott Bessent defended the Trump administration’s pursuit of Greenland and its use of tariffs as strategic tools at the World Economic Forum, pushing back against international criticism while outlining the economic rationale behind contested policies.
In an interview with Fox Business anchor Maria Bartiromo, Bessent positioned Greenland’s potential acquisition as a 150-year-old strategic imperative, not territorial ambition. The reasoning: without U.S. control, Greenland lacks capacity to defend against missile threats or foreign incursion, potentially drawing America into conflict rather than preventing one.
“If another country moved in on Greenland, the US would be called upon to defend it,” Bessent said. Uncontrolled Greenland, he argued, makes the United States strategically vulnerable as Arctic trade routes expand and the island becomes more valuable geographically.
Tariffs as Leverage, Not Punishment
Bessent rejected characterizations of tariffs as punitive, framing them instead as negotiating tools that have produced measurable results. He cited the fentanyl tariffs imposed on Mexico, Canada, and China—which he called a legitimate national emergency—as forcing drug-producing nations to the negotiating table and driving “substantial drops” in overdose deaths among Americans.
The Treasury Secretary also highlighted the October threat of 100% tariffs on China over rare earth export controls, which he said forced Beijing to roll back restrictions for one year. “This is what US leadership looks like,” Bessent stated, noting he negotiated on behalf of the entire industrial world, not just American interests.
Tariff revenue has reached “hundreds of millions” of dollars, he said, feeding into deficit reduction. The U.S. fiscal deficit fell from 6.9% of GDP in calendar year 2024 to 5.4% in 2025. Bessent called for reaching 3% by the end of Trump’s term.
NATO Alliance “Safe and Sound”
Regarding international pushback—particularly from Denmark and the European Union’s emergency summit on Greenland—Bessent asserted the NATO alliance remains “very safe, sound, and never been more secure” under Trump. He cited increased European defense spending, which he described as correcting a long-standing imbalance.
“Since 1980, the United States has contributed $22 trillion more on defense than all of NATO combined,” Bessent said. “The United States has roughly the same population size but spent two-thirds of our outstanding government debt on defense. Europeans have been spending on social welfare, roads, and education. It’s time for them to pay more.”
However, tensions persist. The EU has threatened to abandon trade negotiations over the Greenland issue, and Denmark has rejected the strategy outright. A 10% tariff on eight countries that deployed troops to Greenland takes effect February 1st if Danish cooperation on Greenland is not forthcoming.
U.S. Economic Strength Defies Predictions
Bessent highlighted a stronger-than-expected economic performance. Fourth-quarter GDP reached 4.7% when adjusted for fiscal contraction—”pure private sector growth,” he emphasized. The Atlanta Federal Reserve’s current GDP Now estimate reads 5.3%, suggesting continued momentum into the first quarter.
He credited Trump administration policies: tax cuts, trade deals, and deregulation, which he called “probably the most powerful part.” Full expensing for corporate equipment and infrastructure has sparked 12-14% capex growth, historically followed by employment gains.
Working Americans will see tax refunds of up to $1,000 per wage earner in the first quarter, Bessent projected, as withholding adjustments take effect. Real incomes have risen every month since Trump took office, he said, and energy independence has driven gasoline prices below $2 in many states and below $3 nationally.
Housing, Credit, and Supply Chain Overhaul
The administration announced multiple affordability measures: a ban on large institutional investors purchasing single-family homes, $200 billion in mortgage-backed securities purchases to narrow lending spreads, and a proposed 10% cap on credit card interest rates.
Bessent defended the institutional investor ban despite bank stock concerns, noting that deregulation has increased banks’ lending capacity by $2.5 trillion (per Oliver Wyman estimates). Small and community banks remain a focus—the administration aims to reverse post-financial-crisis consolidation that eliminated more than 50% of such institutions, which power small business and agricultural lending.
Also read: World Economic Forum 2026: Canada’s PM Carney Declares Global Order Breaking Down
Reshoring Critical Supply Chains
A central theme: reshoring semiconductor manufacturing, rare earth magnets, and other critical industries to reduce dependence on China and Taiwan. Bessent compared semiconductor concentration—97% of high-end chips made in Taiwan—to a potential “economic apocalypse” if that capacity were disrupted.
The administration took equity stakes in Intel and other defense contractors, a departure from free-market orthodoxy that Bessent justified on national security grounds. “Defense contractors are systemically important like banks and exist because of U.S. backing,” he said, adding they have underperformed for years on contract fulfillment. Until normalized, “you need to build more factories and buy back less stock.”
At Treasury’s direction, the administration is creating a critical minerals bloc with G7 partners plus Australia, India, Mexico, and South Korea. Bessent projected 18-24 months to U.S. independence in rare earth magnets and other minerals.
Sanctions, AI, and Global Growth
On Iran, Bessent cited successful economic pressure resulting in currency collapse, bank failures, and dollar shortages—achieved “without shots fired.” A Senate proposal for 500% secondary tariffs on buyers of Russian oil remains under consideration, though Bessent suggested the President possesses authority under existing emergency powers.
Regarding artificial intelligence and job displacement, Bessent drew parallels to past productivity booms, which historically generated net job growth despite sectoral shifts. Record factory groundbreakings reflect the administration’s strategy to return precision manufacturing to the U.S., offsetting potential AI-driven job losses.
The Investment Pitch
Bessent concluded with an appeal to global capital: the U.S. offers “tax certainty, regulatory certainty, and energy certainty.” He contrasted this with Europe, where he cited Mario Draghi’s 2022 report on regulatory burden and noted that the largest European company by market cap (Novo Nordisk, ~$400 billion) pales against Nvidia ($5 trillion), attributing the gap to regulatory environment differences.
“Tech executives tell me it’s easier doing business in China than the EU,” Bessent stated, arguing that operational constraints have stifled European innovation.
