Donald Trump’s proposal to take over Gaza threatens decades of US policy

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With one sentence, Donald Trump moved to upset decades of US foreign policy: “The US will take over the Gaza Strip, and we will do a job with it, too.”

The president said he envisioned a “long-term ownership” position — without spending US taxpayer money — that would result in the construction of the “Riviera of the Middle East”. 

Long a critic of US intervention in “endless” foreign wars, Trump initially did not rule out military force. By this morning, though, the president said no American troops would be needed, and that Gaza would be “turned over to the US by Israel” after fighting in the territory had stopped.

Palestinians, Trump said, should be resettled permanently. Alongside him at the White House on Tuesday, Israeli Prime Minister Benjamin Netanyahu was practically giddy — the US president was articulating a long-held ambition of Israel’s far right: expelling millions of Palestinians from the beleaguered enclave.

With this brash proposal, Trump is turning back to the grandiose Middle East playbook of his first term. In 2017, he recognised Jerusalem as Israel’s capital and two years later accepted Israeli claims to Syria’s Golan Heights. Israeli settlements in the occupied West Bank were also made legal under US law. But these were actions Trump could make unilaterally. His ideas that required working with Palestinians went nowhere.

With Gaza in ruins now, Trump is trying to build on his call to “clean out” the enclave, threatening a repeat of what Arabs call the Nakba — or catastrophe — when hundreds of thousands of Palestinians fled their homes during the 1948 war from which Israel was founded.

The president expects Washington’s partners in the region, particularly Jordan and Egypt, to accept Palestinians. But Middle Eastern — and European — countries were quick to condemn Trump’s plan. And amid all this, Netanyahu has vowed to resume Israel’s war in Gaza.

For now, Gaza will remain on Trump’s territorial wish list along with Greenland, Canada and the Panama Canal.

The latest headlines

• Check out the FT’s new US trade tracker, which has the latest data on imports, exports and trade balances as Donald Trump threatens an all-out trade war. [Free to read]

• Palestinians fear that Trump’s plan to expel Gazans will embolden Israeli ultranationalists who are determined to annex the West Bank.

• The UK’s new ambassador to Washington, Peter Mandelson (aka the Prince of Darkness), faces his most daunting challenge yet: Trump.

• The long period of low-tension “Arctic exceptionalism” appears to be ending as military, commercial and diplomatic interest in the region grows.

• As Trump roils markets, and more volatility to be expected, here’s how global investors are trading the trade war.

What we’re hearing

The tariff hardliners in Donald Trump’s court are coming out on top.

In this redux of the trade battles fought during the president’s first term, Trump adviser and trade hawk Peter Navarro is leading the charge. The voices of more cautious officials such as Treasury secretary Scott Bessent are muted, at least for now.

Behind the scenes, Navarro has been working closely with Howard Lutnick, the commerce secretary nominee, and Jamieson Greer, Trump’s pick for US trade representative, as they begin to construct the president’s trade policy. Lutnick, who backs the tariff agenda despite his Wall Street background, has played a starring role in the back-channel talks with Canada and Mexico in recent weeks.

But it’s Navarro, who was released from jail during last year’s Republican convention, who has become a key White House figure and the biggest advocate for imposing large tariffs on the US’s trading partners, according to people familiar with his thinking.

A person familiar with the situation told the FT’s Aime Williams: 

Navarro gets what he wants, he has been more emphatic than he was in Trump 1.0. He is now a major figure and Trump refers to him as ‘my Peter’.

Another person said Trump would often put Navarro out in public to “scare” people with his maximalist take on tariffs and trade.

We can already see the impact: US executives are being bombarded with questions over how they’ll cope with Trump’s trade wars, Canada is convening an economic summit and the EU is preparing to hit Big Tech with a “bazooka” tool in retaliation for any tariffs on the bloc. Even a top Federal Reserve official said it would be a “mistake” to ignore tariff risks.

Viewpoints

• In his latest Alphaville post, Toby Nangle looks under the hood at the US assets that could go into the sovereign wealth fund Donald Trump wants so badly.

• The FT editorial board says a mercurial Trump has “outdone himself” with his Gaza proposal, which is “arguably his most reckless plan” yet.

• As Trump throws American science into chaos, science commentator Anjana Ahuja breaks down how researchers should respond.

• Trump’s apparent desire to absorb Canada as the US’s 51st state has reignited the existential crisis that has long plagued Canadians, says Joe Suss.

• The biggest casualty of Trump’s tariff threats? The US’s predicability, according to Martin Wolf.