The Decibel - How the world changed this week at Davos

Episode Date: January 23, 2026

This week, Prime Minister Mark Carney and U.S. President Donald Trump made waves in Davos, Switzerland as both offered competing visions of a new world order. Government and business leaders were in the Alps for the annual World Economic Forum, where the U.S. struck a ‘deal’ with NATO on Greenland and Trump launched his Board of Peace.The Globe’s international affairs columnist Doug Saunders is here to explain Canada’s place in a changing world order, as long-standing partnerships were tested and the foundation for competing alliances was laid.Questions? Comments? Ideas? Email us at [e-mail] Hosted by Simplecast, an AdsWizz company. See pcm.adswizz.com for information about our collection and use of personal data for advertising.

It was an eventful week at the World Economic Forum in Davos, Switzerland. That's where leaders from the business and political world meet each year to discuss major economic and social issues. Prime Minister Mark Carney made international headlines with his speech on Tuesday, calling on middle powers to act together in the face of an increasingly unpredictable U.S. When we only negotiate bilaterally with a hegemon, we negotiate from weakness. We accept what's offered. We compete with each other to be the most accommodating. This is not sovereignty.

It's the performance of sovereignty while accepting subordination. A framework deal was announced on Greenland, but the debate over the territory's sovereignty is ongoing. It's the ultimate long-term deal, and I think it puts everybody in a really good position. And U.S. President Donald Trump launched his controversial new Board of Peace. This board has the chance to be one of the most consequential bodies ever created. And it's my enormous honor to serve as its chairman.

I was very honored when they asked me to do it. Importantly, what's coming into focus is the way the world order is changing. As longstanding partnerships are stretched and tested, and the foundation for competing alliances is being laid. So today, the Globe's International Affairs columnist, Doug Saunders, is here to help us make sense of what just has. happened. What's going on with this realignment of global powers and where Canada fits in? I'm Cheryl Sutherland, and this is the decibel from the Globe and Mail.

Hi, Doug. Thanks so much for coming on the show. Thanks for coming into the studio. Hi, Cheryl. Real pleasure to be here. This was quite an eventful Davos. Is it usually like this? I think generally over the last 20 years, it's become sort of a background noise sort of event. And it's ironic because during the last 10 years, a lot of people on the far right, notably Donald Trump in his circle, have taken to retailing conspiracy theories about the World Economic Forum. Donald Trump, in his first election term, was accused by the Anti-Defamation League of spreading anti-Semitic hate through one of his campaign ads that painted it as being sort of a dark Jewish-controlled conspiracy. So to see him embrace it as a place to do his thing probably doesn't make some of his more doctrinaire followers very happy, but also is sort of a weird turn of this group. We're all used to saying that the World Economic Forum is a boring business meeting.

Yeah, it's definitely not boring this time around. So let's talk about some of the big things that happened this past week. So on Wednesday, Trump said he and NATO's Secretary General, Mark Ruta, reached a framework deal over Greece. Greenland. What do we know about this deal? We don't know a lot about the specifics. Whatever Mark Ruta said to Donald Trump was enough to convince the president to withdraw the tariffs that he had imposed against European countries that had defended Greenland's sovereignty and to allow the president to portray this as a win for him, that he got Greenland in his terms. What it sounds like,

however, from what's been leaked and what reporting there's been from people who are in the room is that Mark Routter used his somewhat obsequious relationship with Donald Trump to essentially do a slate of hand where he gave Donald Trump the status quo pro ante. He gave the United States what it already has in Greenland as an almost an exit ramp. for the president, because it sounds like he will have some sort of deal that gives the United States the right to open military bases in Greenland, which it already has, and the right to exploit the mineral resources of Greenland, which it already does and has pretty much unlimited right to do. I don't think the substance of the agreement is going to be that different from what already

exists. Now, Greenlandic politicians, and, you know, I mean, Greenland is essentially an indigenous self-governed territory dependent on Denmark for financial support and so on. And there is some considerable unhappiness from Greenlandic politicians that Danish figures in NATO could promise things involving its territory to the president of the United States without their involvement. And of course, they should be angry about that. However, I have a feeling that what's being promised is not that different from what already exists in any substantial life. Well, the important word in here is sovereignty, right? Because the U.S. is saying it would be given some form of sovereignty over military bases in Greenland. But Greenland and Denmark have said sovereignty is not on

the table. Can you just explain what's going on here? I suspect what's being offered here is something similar to what countries have. have with their embassies in other countries. I mean, the Canadian embassy in France is considered territory of Canada, right, when you're on an embassy. It's a sort of weird little form of sovereignty overland. There are examples of military bases, such as the British bases in Cyprus, that are considered the sovereign territory of the country that holds the base.

That partly has to do with weird British semi-colonial relationships with the island of Cyprus and so on. So it's not impossible to imagine that sort of thing happening. If you read the fine print, I suspect it's very different from what Donald Trump stood in Davos and said he had to have, which is United States sovereign control of Greenland. They have a choice. You can say yes and we will be very appreciative or you can say no and we will remember. And, you know, he posted photos. of himself in the White House pointing to maps of North America painted entirely red, white, and blue, including Greenland and including Canada, by the way. So it's hard to say anything other

than that Donald Trump probably backed down from his demand for sovereignty, realizing that it would cause either a military confrontation with NATO, because Denmark is a NATO member, or it would cause some impossible dilemma. It would not be easy. There's nobody who's just going sell Greenland to the United States like Russia sold, Alaska to the United States in the 19th century. That's not going to happen. So Mark Ritter came in realizing this and offered him an off ramp. Okay. The Greenland situation was viewed as a sort of test of NATO and of EU. What does this apparent de-escalation say about the strength of the alliance and of the EU? It was sort of a game of chicken, you could say, with the surviving democracies,

within NATO and with the European Union countries, in that if it had come to an actual showdown over Greenland and heaven help us, shots being fired even, that would have meant the end of NATO. And, you know, we may be approaching the end of a U.S. role in NATO. I was going to say because even the fact that this even came to this point, right, that the U.S. is threatening to take over Greenland, doesn't that all? also to seem that NATO is kind of falling apart with this conversation. So this gets into the sort of inner workings of Mark Ritter's mind.

Okay. I want to go there. I think he would like to say that over the last year, he's been the Trump whisperer. He has done everything to placate the U.S. president and to keep him from having a sudden outburst in which he pulls the United States out of NATO or something like that. Although all sorts of crazy ideas have been allowed, pledges that countries should spend wild amounts of their national economy, 2% or 5% or whatever, on their own defense, because the U.S. president has decided those numbers have some meaning. And now, of course, the Greenland compromise in order to keep the United States from canning

NATO, right? I think if the United States withdrew, there's a little bit of ambiguity because the NATO Charter does specify the United States as being core to NATO, even if reality is overtaken that and the non-U.S. countries are an equal part of it. With the United States withdraw in the way that would allow NATO to continue to exist without the United States, which, you know, it would do fine. For example, in defending Europe against Vladimir Putin's invasion of Ukraine, the European countries have always from the beginning given more and spent more on Ukraine than the United States. So the other thing that's been going on during the last year is European countries have attempted to start to establish collective defense and military procurement alliances outside of NATO.

And Canada signed on to those last summer. So some of the framework of that stuff is already in place. So there's a whole lot of machinations going on behind the scenes, both to try to save NATO and to try to create a collective defense alternative to NATO. We'll be right back. Let's talk about another big moment from Davos. In a world of great power rivalry, the countries in between have a choice. Compete with each other for favor or to combine to create a third path with impact. Prime Minister Mark Carney's speech on Tuesday got a lot of attention.

And Carney specifically addressed middle powers. Doug, who are these so-called middle powers? I mean, really, with the audience he was talking to, he meant Europe and Canada, but certainly it would also incorporate Japan, Korea, Australia, New Zealand. He meant the surviving democracies. There was some peak from what you might call global south countries who I think it was clear to their governments that he wasn't speaking about them. But you could include Brazil and so on in that list.

countries like that that have some ability to have economic clout. Notably, he wasn't just talking about democracies either, though. So theoretically, places like United Arab Emirates and Qatar could be included in that list. So he was talking about specifically the members of NATO who are not the United States, I think. It sounds like there's something in whatever people want to take from that, right? It reminds me of the middle class. It's like whoever thinks their middle power can feel like they're being talked about. Is that kind of the idea from this?

Yeah. And he's bringing back what had become an unfashionable idea. There was particularly toward the later decades of the 20th century, a whole school of thought in Canada that Canada could have diplomatic and political clout by being a middle power. And in that sense, middle in between the superpowers. It could be a brokerage power. This is what gave rise to the great love of peacekeeping in Canadian governments and the idea that things like Middle East crises, we could play an important role as middle brokers, which we did in the 40s and 50s at the very least. That idea fell out of fashion mainly because it didn't seem to work anymore. The idea that countries like Canada or Norway or so on had power by being in between larger powers and able to broker them, that just wasn't working.

That was not how problems got solved. So by bringing back the idea of the middle power, he's sort of saying that the idea has some relevance now that the United States is no longer there. I mean, we are in a world where there's the United States, there's China, and then there's kind of everyone else. Okay, so how realistic is it for middle powers like Canada to stand apart from superpowers like the U.S.? How would that look? Well, Canada is in a different position than the European countries are, economically at least, and probably in defense as well. European Union countries, with the loss of U.S. markets and trade, could replace all of it within a few years with their own neighboring markets. Canada, something like 70% of our entire economy is dependent on trade with the United States. And a very large share of that is things that cannot easily be shifted to other markets.

Natural resources, softwood lumber and things like that. I mean, the best analysis I've seen is that after 10 or 15 years, we could maybe reduce that U.S. share by 10 or 15 percent by trading with China and Middle East and more with Europe and so on. militarily though, we're in some regards in a better position, even though we have much smaller militaries than even fairly small European countries do at the moment. We need to spend more money on defense, but we wouldn't need to do the crazy amounts of defense spending that, say, Germany has had to deal with its more imminent threats. There are some forms of threat to Canada that even if the United States is completely rogue an actual threat to Canada rather than an ally or a competitor,

that the United States would de facto be a protection to Canada. For example, in the often discussed scenario of Vladimir Putin deciding to send an invasion over the Arctic, if that were to happen, the United States would, whoever was governing it, would view that as an incursion on its northern border and on its Alaska border and would treat that as a threat to the United States. Whereas that's not necessarily true in like Lithuania, for example. If Russia were to really go nuts, Lithuania would be directly attacked and there would be NATO agreements to protect it, but there wouldn't be some power that would say that this is a direct threat to us.

So another huge thing being talked about at Davos is Trump's Board of Peace, which he launched there on Thursday. It would oversee the second stage of the U.S. Gaza Peace Plan and was created with the goal of managing and maintaining peace in the region. But it seems like it may actually go beyond that. We're going to be very successful in Gaza. It's going to be a great thing to watch. And we can do other things. We can do numerous other things. Once this board is completely formed, we can do pretty much whatever we want to do.

Could you tell us about this Board of Peace? Well, the idea of having a board of peace. bunch of unrelated countries on a board to oversee post-conflict transition in a country is not a new idea. In some ways, this resembles the international body that governed Bosnia, for example, after the Yugoslav wars in the 1990s. And in some ways, it actually resembles the international body that in 1947 made the plan to split up Britain's colonies in the Levant after Britain had decolonized into the twin states of Israel and Palestine with a shared capital in Jerusalem. And Canada played a major role in that committee's decision.

That was under the aegis of the newly formed United Nations. So the sort of broad idea of a bunch of countries overseeing a transition like that is not unusual. This particular body is very unusual and seems designed not to actually accomplish a post-conflict transition into stability in the usual way. What makes this Board of Peace different substantially from those other, you know, multinational post-conflict transition bodies is that even though it's called the Border of Peace, peace and it has dues-paying member countries, it basically is Donald Trump trying to govern the Middle East, possibly other areas.

He vaguely suggested that it could become a governing body for other conflict areas or for other great world decisions or it could become a new United Nations or who knows what. We'll do it in conjunction with the United Nations. You know, I've always said the United Nations has got tremendous potential. has not used it. I think the important thing that stands out in what we do know about it is that it's explicit that Donald Trump will be the lifetime chair of the Board of Peace. And he's deliberately selected people and countries that would essentially be sympathetic

to him. So in that sense, it's very hard to imagine that this thing would ever be accepted by any of the subject population. whose acceptance would be needed for anything like this to work. As an expression of ego, it'll get some attention, but it's very hard to imagine it being turned by its members into something that could actually be productive and produced peace and reconciliation and stability.

And I want to ask you about Canada, because Canada has been invited. What's the calculation Carney needs to make here? I think a lot of leaders like Prime Minister Carney are wary to simply say no just because it's the only game in town. It's the only thing being done. He did say outright no to paying a billion dollars. He made it clear to the press that Canada is not going to be handing a billion U.S. dollars over for this. But it's sort of that game like, well, if we're not at the table on this, then it's just going to be the bad guys.

And also if we say no, it's going to anger him. And there's a sort of funny balancing act that Carney is still playing where even though he talks about a decisive break from the United States in his Davos speech and elsewhere, he still has another track going on where he's trying to negotiate something with the Trump administration. And he doesn't want to claw back all his chips by outright refusing things. He doesn't want to be the one who's saying no. It's fine to be kicked out of things by Donald Trump. You don't want to lose any leverage you might have by being the one who pulls out. Yeah, of course, Canada has USMCA negotiations coming up. And as we've said many times on the show, Mark Carney is in a very tricky situation when it comes to the U.S.

It's something we talk about many times. Yeah, that's the thing. I mean, despite everything he said, I mean, Mark Carney was not among the NATO leaders who boldly said, we are going to send some of our troops to Greenland when the threat was earlier in January, when the U.S. was threatening to seize it for absolute sovereignty. We learned that there were Canadian troops preparing to go to Greenland to participate in NATO exercises that were going on there. But other countries had used that to say we're sending troops to Greenland. And Canada very quietly backed out of that crowd.

And I can only imagine because it was a symbolic gesture and it wasn't the sort of symbolic gesture you want to be making when you're trying to save your free trade agreement. Yeah. So, Doug, it seems like this week has marked the beginning of a new world order. We had huge shifts around Greenland, Carney's Mike Drop moment with his speech, Trump's new potential UN maybe with the Board of Peace. What is this new world? I think it was a turning point in a big way. In the sense that a lot of countries that had tried to balance conciliation with confrontation, realized that the conciliation approach wasn't getting them anywhere.

And that's why I think Mark Carney's speech had such impact. Carney's speech, aside from being well articulated, had the advantage of timing. It expressed what everybody was suddenly thinking, at least. certainly in Europe and Canada, at the moment when they had started to really think it. Proceeding Donald Trump's ramble on Greenland at Davos with that speech essentially sealed it all into a package and gave it a set of names, right? You could look at the journey that Canada and other surviving democracies have been on over the past 12 months as something like the stages of grief because the death happened.

a year ago. It was pretty clear right from inauguration day that the United States was not going to be part of our community of nations in the way that it had been before. And Canada and its allies have gone through those stages of grief, denial, depression, bargaining. There's been a lot of bargaining over the past year. And you could say that what happened in Davos was the beginning of a move to the final stage of grief, which is acceptance, right? The powerful have their power. We have something to. The capacity to stop pretending, to name reality, to build our strength at home, and to act together. That is Canada's path. We choose it openly and confidently, and it is a path wide open to any country willing to take it with us. Thank you very much. It was a mutual message of acceptance that, okay, we don't have this person with us anymore. We're going to have to move on. We're going to have to do things without him. And all of our flailing about and misery and bargaining and anger and denial and so on

is going to have to be replaced because it's an emergency with us working together to create something new. So I would hope that in a year or two, we look back at Davos as the beginning of the stage of acceptance in the world grieving process at the loss of the United States. Doug, it's always great to have you on the show. Thank you so much.

Thank you, Cheryl. That was Doug Saunders, the Globe's International Affairs columnist. That's it for today. I'm Cheryl Sutherland. Our producers are Madeline White, Michal Stein, and Ali Graham. Our editor is David Crosby. Adrian Chung is our senior producer, and Angela Pichenza is our executive editor. Thanks so much for listening.