With inflation and an energy crisis setting the stage for a recession, the West is forced to confront a geopolitical threat from Russia, while at the same time its unity is undermined by internal economic competition. In recent weeks, the focus has been on the choice of the two most important Western powers, the United States and Germany, which face the same accusation: they are prioritizing their narrow national interests at the expense of their allies.

In the United States, Joe Biden, in connection with the November elections, reduced the fight against inflation to his main goal. The government and the central bank are pursuing a strict anti-inflationary policy based on high interest rates, while the dollar is growing rapidly on international markets. But this policy brings to its knees many countries of the world, whose public and private debt is estimated in dollars. Many experts fear a repeat of the debt crises of the 1980s and 1990s, which were also caused, among other things, by the strong dollar policy at that time.

As such, there are growing voices abroad calling for the Biden administration to think strategically and loosen policies that threaten the economic stability of many countries, including important US allies. But so far, the President of the United States, whose main strategic goal is to prevent the return of Donald Trump to power, has not reacted in any way, wanting to prove that he can tame inflation better than his rivals. Global financial stability is hostage to the polarization of American democracy.

Germany is facing similar accusations from its EU partners: Berlin’s aggressive gas-buying policy to build up huge reserves has already fueled prices and created shortages for other member states. We are also well aware that Germany is blocking gas price caps by unilaterally spending billions of dollars in subsidies to its businesses and consumers. As EU officials are now openly saying, the danger is that the European economy will turn into a race of competing national subsidy policies – a race Germany certainly knows it cannot lose.

With the economic crisis testing the resilience of Western societies and, as a result, public support for Ukraine, one would expect the two major powers of the West to demonstrate higher leadership thinking. Instead, both countries appear to be using the crisis as an opportunity to assert their dominance over their allies, Germany in Europe and the US in the West and around the world. If this does not change, there is a risk that Putin will lose the war in Ukraine but still achieve his grand strategic goal of destabilizing the world order and dividing the West.