The three blows that killed the rules-based international order

Photo by Intan Yuhanis on Unsplash

At this year’s World Economic Forum in Davos, Mark Carney delivered a speech that will likely be remembered as a watershed moment. The Canadian prime minister — a former Goldman Sachs banker, Bank of England governor, and someone most would consider a perfect torch bearer for liberal, rules-based globalisation — made an extraordinary admission:

We knew the story of the rules-based international order was partially false, that the strongest would exempt themselves when convenient, that trade rules were enforced asymmetrically, and we knew that international law applied with varied rigour, depending on the identity of the accused or the victim (…) Stop invoking rules-based international order as though it still functions as advertised. Call it what it is: a system of intensifying great power rivalry where the most powerful pursue their interests using economic integration as coercion.

For decades, nations like Canada prospered by participating in what Carney called “rituals” — placing signs in windows to signal compliance with a system they privately knew to be rigged in favour of wealthy nations. The fiction was useful, he conceded, because American-led hegemony provided comfort and prosperity for middle powers in the Global North. But that bargain, Carney declared, no longer works.

Carney’s speech crystallises that the rules-based international order was in many ways a facade — and now, it’s firmly dead. But how exactly did it die? My view is that its death unfolded in three distinct phases (or by three distinct ‘blows’). First, by design. Then, by Trump’s wrecking ball. And finally, by Carney’s confession.

Blow number one: the order was rigged from the start

The rules-based international order emerged from the ashes of World War II, supposedly to ensure global cooperation and prosperity through institutions like the United Nations, the International Monetary Fund, the World Bank, and later, the World Trade Organization. The rhetoric was lofty: multilateralism, sovereign equality, global development and collective security would replace the law of the jungle. But in reality, these institutions were designed to entrench the dominance of the world’s wealthiest nations — and those nations knew it.

Take the IMF and World Bank. Both institutions operate based on a weighted voting system where economic power translates directly into political control. The United States holds effective veto power over all major decisions, and together with the rest of the G7 and European Union, controls well over half the vote in both agencies. If we look at voting power in per capita terms, the undemocratic nature of these institutions becomes immediately visible. In the IMF, for every vote that a person in the United States has, a person in Kenya has 1/20th of a vote, and a person in India has 1/25th of a vote. In the World Bank, for every vote a person in the United States has, a person in China has 1/20th of a vote. In any democratic polity, we would reject the notion that rich people should have more voting power than poor people. Yet such plutocracy is normalised in institutions that claim to govern the global economy.

These power imbalances help explain how the IMF and World Bank could get away with imposing structural adjustment programmes and austerity across the Global South for four decades. These programmes — focused on privatisation and forced market liberalisation — created lucrative profit opportunities for multinational corporations based in the Global North while devastating developing countries. During the 1980s and 1990s, structural adjustment caused incomes to decline and poverty to rise across much of Africa and Latin America, in some cases triggering decades of recession.

The WTO also operates through a facade of consensus that masks profound asymmetries. The dominant economic powers often establish agendas before trade rounds even begin, inviting select developing countries to “Green Room” meetings where key decisions are made behind closed doors. Throughout these negotiations, poorer nations remain at the behest of wealthy countries, often unwilling to contest predetermined proposals for fear of economic consequences. In fact, researchers studying the WTO have found that small groups of powerful, high-income countries were deliberately using their power and market influence during the round of trade negotiations that led to the formation of the WTO (the Uruguay Round) to rewrite the rules of international trade to the advantage of corporations based in its countries.

The liberal establishment knew the system was rigged. They knew trade rules were enforced asymmetrically, that international law applied with varied rigour depending on who violated it, and that institutions like the IMF and the World Bank could destroy economies while claiming to save them. But the fiction served their interests, so they kept the sign in the window.

Blow number two: Trump demolished the facade

Since 2017, the Trump administration adopted policies that violated the rules-based international order more explicitly than ever before. Trump’s first term marked a sharp break with decades of Republican orthodoxy on free trade. He imposed tariffs on various imports, launched a trade war with China, and unilaterally paralysed the WTO by blocking appointments to its Appellate Body — effectively destroying the institution’s ability to mediate disputes. The Biden administration continued this approach, maintaining many of Trump’s controversial tariffs and refusing to restore the Appellate Body.

Trump’s second term escalated this trajectory dramatically. In March 2025, Vice President JD Vance delivered a speech at the American Dynamism Summit that inadvertently exposed the rigged logic underpinning globalisation. Vance articulated what liberal globalists had long understood but rarely admitted: “The idea of globalisation was that rich countries would move further up the value chain, while the poor countries made the simpler things.” He then acknowledged the system had failed — not because it exploited developing countries, but because China had managed to climb the value chain.

The speech was revealing in what it exposed: both the MAGA movement and the progressive left share a critique of the liberal establishment’s faith in globalisation and the rules-based international order. The difference lies in their diagnosis. The MAGA movement argues the system failed because it didn’t benefit rich countries enough. The progressive left argues it failed because it systematically exploited developing countries. Both agree the liberal order is broken; they just disagree about who it should have served.

Trump 2.0 went further still, explicitly violating the UN Charter which was established to promote international peace and ensure the sovereign equality of nation states. In January 2026, US forces attacked Venezuela, kidnapping President Nicolás Maduro in a flagrant breach of the UN Charter. When questioned about international law, Trump made clear he does not consider himself bound by it — he only considers himself bound by his own moral judgment.

Trump has now made it clear that the United States will violate trade agreements, embrace protectionism, and pursue American hegemony without apology. The pretence of a liberal rules-based order championed by his predecessors has been abandoned. Trump pursues US imperialism violently and explicitly.

Blow number three: Carney delivered the confession

This brings us back to Davos. Mark Carney is in many ways the embodiment of the liberal establishment — Goldman Sachs alumnus, central banker, now leader of Canada’s Liberal Party. He is precisely the type of figure who one would expect to find in the inner circle of ‘globalists’. Which makes his admission all the more devastating.

Carney didn’t just acknowledge that the rules-based international order is failing. He admitted that it was always partially false, that the establishment knew it, and that many wealthy nations participated in the fiction because it was useful. He explicitly rejected nostalgia for the old system.

The world Carney described in blunt terms is a world of great power rivalry where the rules no longer protect anyone, where economic integration has become a weapon, and where middle powers must choose between building fortresses or forging new coalitions. He called for middle powers to stop invoking the rules-based international order as though it still functions as advertised, and instead to name reality: “a system of intensifying great power rivalry where the most powerful pursue their interests using economic integration as coercion.”

The significance of Carney’s speech cannot be overstated. For a global, liberal icon to explicitly acknowledge the liberal establishment’s complicity in perpetuating a rigged system — and to argue that wealthy nations went along with the facade because it benefited them — amounts to an indictment from the inside. It’s one thing for critics on the left or the nationalist right to decry the rules-based order. It’s another entirely when the high priest of the liberal establishment declares the temple a fraud.

The rules-based international order is dead. It died slowly, by three blows: first by design, as the architects embedded asymmetries that favoured the powerful; then by wrecking ball as Trump dispensed with the pretence; and finally by confession, as Carney laid bare what the liberal establishment had secretly known all along.