Tariffs Delivered the Jolt – Now Comes the Build

EXPERT PERSPECTIVE / OPINION — Bold moves lead to bold outcomes. President Trump understood that reshaping global trade would bring short-term pain, including market volatility and political risk. But he also knew that without disruption, there would be no leverage, and without leverage, no seat at the table. His tariff strategy, though unconventional, delivered a necessary shock to the international system and forced a long-overdue reckoning with America’s trading partners.

That bold approach marked a new era in U.S. economic policy. It reflects the realities of great power competition, which requires a more comprehensive approach to protecting and promoting America’s global position. Today, the new agenda for protecting U.S. interests is coming into focus: rebalancing trade, reducing dependence on fragile foreign supply chains, securing fairer terms, and diminishing the economic leverage held by strategic competitors.

However, protecting U.S. economic interests is only half of the equation, and tariffs alone can’t finish the job. To lock in long-term advantage, protective actions must be paired with strategic investment to promote U.S. competitiveness at home and abroad. Now is the time to advance the President’s other bold idea at the heart of a winning strategy: establishing a U.S. sovereign wealth fund. This national strategic investment platform, which he has long championed, would rebuild America’s industrial strength, invest in critical infrastructure, accelerate innovation, and reestablish the United States as the world’s manufacturing powerhouse.

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Other Global Players already have this Important Tool

While the US has long admired the challenges of dependencies on foreign supply chains and a dwindling industrial base, other nations have refactored their economies with direct national investment.  China continues to inject trillions of dollars into strategic sectors like semiconductors, manufacturing, AI, rare earth processing, telecommunications, biotech, quantum computing, energy generation, infrastructure, and strategic emerging industries.  Nations like Singapore, Norway, UAE, Saudi Arabia, Indonesia, and Qatar have used sovereign wealth funds to ensure their strategic capacity in domestic infrastructure and technology competitiveness while projecting global industrial influence.

Meanwhile, the U.S., even with all its innovation capacity and capital markets, lacks a national vehicle to match economic goals with long-term capital investment.  Too often, U.S. companies have invented critical technologies and then given them away by offshoring the capability and capacity to other nation-states, often to our competitors.  For decades, U.S. companies, purely pursuing short-term profits over long-term resilience, outsourced their industrial capacity to foreign players to avoid capital investments that other countries were willing to make.  Vehicles like tax credits, grants, loan guarantees, and offtake agreements are helpful but insufficient. They are too slow, fragmented, and bureaucratic to compete strategically against nation-states with whole-of-country commitments.

A well-managed sovereign wealth fund would not only bridge this gap but also equip the United States with a powerful instrument to proactively and strategically direct investments in support of its strategic national needs.

Strategic Investment Complements Trade Policy

While trade rebalancing is a necessity, strategic investment needs to follow, translating leverage into capacity.  A sovereign wealth fund should be designed to deliver investment into sectors where America must lead, such as advanced manufacturing, energy dominance, defense, digital and AI infrastructure, and frontier technologies.

This is not a subsidy program.  It’s an investment platform to back commercially viable capabilities, companies, and industries to help revitalize the American technical, industrial, and manufacturing base. In doing so, these investments would restore our national resilience and generate long-term returns, with proceeds flowing back into the U.S. Treasury without the need for subsidies and giveaways while expanding economic strength.

We’ve seen this kind of strategic investment model succeed before.  For twenty-five years, In-Q-Tel, which I helped build, has proved that mission-aligned capital can accelerate technology development to meet national needs and do so without distorting markets.  The same concept can be scaled and applied more broadly to help re-industrialize America.

Attracting Foreign Investments on U.S. Terms

For seventy years, the United States has invested globally to help industrialize the rest of the world and build a global economy.  Now it’s time to send a clear signal to our global partners: foreign direct investment in American manufacturing and technology will be welcomed if it aligns with our national goals and creates jobs for our citizens.  With a sovereign wealth fund, America is willing to put its money alongside FDI.  We should link targeted tariff relief to measurable domestic FDI commitments in critical industries.

Build an Economic Defense based on Strength

A sovereign wealth fund not only enhances America’s global leadership but also provides a powerful financial countermeasure to respond to predatory countries that use economic coercion, subsidized dumping, and aggressive anti-competitive acquisition and investments. A sovereign fund gives the U.S. the ability to respond at the speed of the market rather than the speed of government, with capital, building domestic alternatives and providing alternative pathways to protect US interests.

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This, paired with strong policy responses, provides the U.S. with the tools it needs to align trade policy and DFI with our standards of fairness, partnership, and competitiveness.

Scale and Execution Matters

If the US wants to use a Sovereign Wealth Fund to compete, it must be designed for speed, scale, accountability and transparency.  It needs to be independently governed, professionally managed and free from short-term political cycles or trendy investment strategies.  The mandate is simple: invest in projects, companies, and industries that serve national strategic objectives and generate outsized returns.

It must be scaled to win. No pilot programs. No soft launches. This is a moment for decisive action and clear vision.

Invest Strategically to Win

We have the talent, innovation, and capital. What we lack is a sense of urgency and the means to protect our interests while also promoting our competitiveness. Meanwhile, our competitors are not slowing down. China is using all available means to out invest in and out-execute us-

With a sovereign wealth fund, we can meet this moment.  It is the means to seize the window  created by trade rebalancing to renew our manufacturing and economic leadership.

We must not rely on failed strategies of the past.  We are not going to out regulate or wish our way into strategic advantage and competitiveness.    We must invest and re-establish this nation as a production powerhouse that leverages our talent, our technology leadership and our economic might. 

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