From TRUMP's Meme Coin to the Return of American Neoliberalism: Survival of the Fittest and Ruthless Growth
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From TRUMP's Meme Coin to the Return of American Neoliberalism: Survival of the Fittest and Ruthless Growth
Against the backdrop of deregulation, Web3 will take up the banner of financial innovation in America's new cycle.
Navigating Web3 tides with focused insightsAuthor: @Web3Mario
Summary: This week has been truly spectacular. On January 18, just two days before his official inauguration, Trump personally launched a cryptocurrency, which surged nearly 400x within days! First, congratulations to everyone who seized this wealth opportunity—and early wishes for a happy new year. There's been extensive discussion about the potential implications of this landmark event. Here, I’d like to contribute my perspective. Overall, I believe "Trump’s coin launch" marks the formal return of American neoliberalism, with survival of the fittest and wild growth becoming the dominant themes of this new era. More specifically, in a deregulated environment, Web3 will carry the torch of financial innovation in America’s new economic cycle.
A Brief History of Mainstream Economic Thought in the U.S.—The Evolving Relationship Between Government and Market
To help readers better understand the significance of this shift, it’s essential to briefly review the evolution of mainstream economic thought in American history. In fact, the development of economic theories is fundamentally a continuous exploration of the relationship between government and market. At different historical junctures, shaped by varying internal and external contradictions, modern sovereign states adopt distinct economic strategies to maintain social stability and competitive advantage in geopolitical contests. Mainstream economic theories are thus abstract summaries of observed phenomena by insightful thinkers—providing theoretical foundations for policymakers. These are not immutable natural laws, but rather sociological frameworks applicable to specific times and places.
With that context established, let’s examine the six major phases in the evolution of economic thought in U.S. history:
1. The Colonial Era Amid Puritan Migration: Mercantilism and Resistance to Colonial Exploitation (1600–1776)
Those familiar with Western history know that, unlike most nation-states, the U.S. is an immigrant nation. The uniqueness of immigrant nations lies in their origins—typically driven by irreconcilable internal conflicts in the homeland, prompting mass migration of marginalized groups. This results in higher initial social cohesion for several reasons: first, these are self-selected groups sharing common ideologies and values; second, during early formation, available resources are abundant enough that all classes enjoy relatively fair distribution and satisfaction.
The birth of the United States traces back to the Puritan exodus from Europe in search of a “promised land,” epitomized by the well-known Mayflower voyage, which established the first British Puritan colony in North America—Virginia. A brief note on the Puritans: medieval Europe was dominated by theocratic rule. As the Western Roman Empire weakened militarily by relying on foreign mercenaries against barbarian invasions, its ruling class turned to religious authority—specifically, promoting Christianity from the Middle East—to legitimize their power amid declining military strength. With most “barbarian kingdoms” converting—Germans, Gauls, Celts, Anglo-Saxons—the former Roman elite transformed into the Roman Catholic Church, shifting governance from brute force to ideological control.
This ideological dominance required elaborate religious rituals to suppress rebellion among militarized but culturally malleable peoples. Thus, medieval Europe saw little grassroots resistance—peasants’ minds were firmly controlled by the Church.
However, religion being metaphysical, differing interpretations inevitably arose. Alternative beliefs challenged the Church’s authority, leading to irreconcilable conflicts—not social disorder per se, but prolonged, bloody wars between alliances of states divided over abstract theological differences.
Amid this turmoil, progressive thinkers emerged, sparking the Renaissance and Enlightenment—cultural movements centered on rationalism and liberty that began dismantling the Catholic order. The Puritans were a product of this: radical religious reformers in England who insisted that the Bible alone held authority, and that every individual could interpret it, rejecting the Church’s monopoly on biblical interpretation. Persecuted and expelled, they became known as “Puritans.” Coinciding with the Age of Exploration and advances in navigation, these anti-authoritarian, freedom-seeking groups migrated to distant North American colonies to build their own “promised land.” This origin story laid the foundation for America’s national ethos: anti-authoritarianism, self-reliance, and a deep commitment to liberty.
This background explains Americans’ apparent obsession with liberalism. That said, while religious freedom existed, economically, the colonies remained under Britain’s mercantilist system. Mercantilism emphasized state power through policy and military force, measuring national strength by gold and silver reserves, aiming for trade surpluses. Britain thus restricted colonies to raw material production—agriculture and mining—while suppressing manufacturing, ensuring dependency through cheap imports of high-value industrial goods. This colonial economy, enforced via acts like the Navigation Acts, led to rising tensions between plantation-owning elites and industrial-minded reformers in the colonies. Key events like the Boston Tea Party reflected these conflicts. Ultimately, after prolonged struggle and with French intervention, American victory in the Revolutionary War marked the nation’s birth.
2. Early Nation-Building and Ethnic Integration: The Agrarian vs. Industrial Debate (Late 18th – Mid 19th Century)
After gaining sovereignty, the young U.S. remained weak and reliant on its alliance with France. Two competing economic doctrines emerged, aligned with the two dominant classes discussed earlier.
In the agrarian South, favorable conditions supported slave-based plantation economies, empowering the landowning class. Influenced by France—then losing ground to Britain in colonial competition—the South embraced physiocracy (重农主义). Unlike mercantilism, physiocracy viewed agriculture as the sole source of value, since it transformed free natural inputs (sunlight, rain, land) into valuable outputs—a true creation of wealth. Industry merely reshaped materials without adding intrinsic value. National strength should thus be measured by agricultural output, not precious metal reserves. Moreover, physiocrats believed in free markets as lubricants for efficient value circulation, contrasting sharply with mercantilist export promotion and import suppression. From a hindsight perspective, physiocracy was a rational choice for a technologically backward but demographically advantaged nation like the early U.S. Unsurprisingly, Southern elites championed this doctrine.
In contrast, the Northern U.S., a key British trade hub, inherited more British economic thinking. Its economy centered on trade and light manufacturing. Having suffered under colonial exploitation, Northern reformers strongly favored industrialization to escape dependency. Under the dual influence of mercantilism and colonial experience, the North developed a pro-industrial ideology—believing industrial value-added was the true engine of national power. Hence, policies like protective tariffs and federal support for domestic industry were advocated.
Over time, cultural divides solidified: Northerners, known as Yankees (originally New Englanders, later all Northeasterners and Union supporters), clashed with Southerners, or Dixie (the South). These divisions culminated in the Civil War, ending in a decisive Northern victory. Industrialism became the dominant doctrine. Key milestones include Alexander Hamilton’s Report on Manufactures (1791), advocating protectionist tariffs and a national bank, and the Tariff Act of 1816, shielding domestic industry from cheap imports.
3. Manifest Destiny and the Roaring Twenties: Laissez-Faire and Classical Economics (Mid 19th – Early 20th Century)
With abundant raw materials fueling rapid industrialization, U.S. power surged. A sense of divine mission and racial superiority gave rise to the ideology of “Manifest Destiny,” driving westward expansion. Through policies like the Homestead Act, settlers were encouraged to seize Native lands. This massive westward movement expanded U.S. territory from the Mississippi to the Pacific.
Meanwhile, classical economics—developed in late 18th and 19th century Europe—deeply influenced American thought. It emphasized market self-regulation, free competition, and economic liberty, forming the intellectual bedrock of capitalism. Thinkers like Adam Smith, born in Scotland and influenced by mercantilism, studied in France and absorbed physiocratic ideas—especially the value of free markets, limited government, and labor-based value theory (though he rejected the idea that only agriculture created value).
Classical economics resonated with an increasingly enlightened West. As human rights movements gained momentum, public aversion to government intervention grew into a consensus. Most Western nations adopted minimal regulation and open trade—laissez-faire. This unleashed rapid capitalist growth. Influenced by Ricardo’s theory of comparative advantage, countries specialized according to strengths. The U.S., like much of the West, experienced broad prosperity. Yet, growing tensions between workers and capitalists loomed—ushering in the specter of socialism.
Marxist economics built upon classical labor theory of value but introduced dialectical critique, using materialism to analyze production relations and develop the theory of surplus value—exposing capitalist exploitation. It was less an economic theory than a call for political revolution. In response, classical economics evolved—adopting marginal utility theory to refine value analysis and price mechanisms. This became neoclassical economics. While Marxism took root in the East, neoclassical economics dominated the West.
4. The Turbulent Great Depression: Big Government and Keynesianism (1929–1980)
Rapid industrialization brought financial innovation—most notably, a booming U.S. stock market. Classical economics’ emphasis on free markets allowed capital to spiral out of control.
The 1920s—“The Roaring Twenties”—saw explosive economic growth and stock market euphoria, fueled by speculation and excessive credit. But supply outpaced stagnant wages, leading to weak consumer demand. Asset prices detached from fundamentals—enter irrational exuberance.
This bubble burst with the Great Depression. Beginning October 24, 1929 (“Black Thursday”), the stock market collapsed. By “Black Tuesday” (October 29), panic accelerated. By 1933, U.S. unemployment hit 25%, industrial output fell nearly 50%, thousands of banks failed, and homelessness soared. Globally, trade volume dropped by two-thirds—laying the groundwork for WWII.
In response, John Maynard Keynes published The General Theory of Employment, Interest and Money (1936), launching Keynesian economics—a direct challenge to classical laissez-faire. Keynes argued recessions stemmed from insufficient aggregate demand, composed of Consumption (C) + Investment (I) + Government Spending (G) + Net Exports (NX). When private demand falters, government must step in. He also called for strict oversight of financial speculation to prevent systemic risk.
Roosevelt’s New Deal put Keynesianism into practice: massive public works programs boosted demand, financial reforms rebuilt trust, and new institutions like the SEC strengthened market oversight.
The New Deal helped the U.S. recover, and post-WWII, America emerged as a global superpower. Keynesianism had proven its worth.
5. Stagflation During the Cold War: Neoliberalism and Supply-Side Economics
After WWII, the world entered the bipolar Cold War era—capitalism vs. communism. Though no direct conflict, proxy wars abounded. After postwar reconstruction, the U.S. hit a wall in the 1970s. This was the socialist bloc’s high point. Following defeat in Vietnam, America shifted to strategic retreat. Two shocks compounded the crisis: the collapse of Bretton Woods in 1971 (Nixon ended dollar-gold convertibility), destabilizing the global monetary system; and the oil crisis triggered by Middle East wars, spiking inflation.
The result? Stagflation—stagnant growth, soaring inflation, and unemployment. Keynesianism, designed for demand-side crises, failed. Economists responded with alternatives. The Chicago and Austrian schools advanced neoliberalism, arguing excessive government intervention stifled innovation, raised production costs, and prevented competitive markets. They advocated small government, deregulation, tax cuts, and reduced spending—reviving supply-side vitality. Crucially, they preferred monetary over fiscal policy for economic management.
By 1979–1980, U.S. inflation neared 14%, unemployment rose to 7.8% (peaking at 10.8% in 1982). Republican candidate Ronald Reagan won office, adopting neoliberalism as core policy—“Reaganomics”—paired with Fed Chair Paul Volcker’s tight money policy. The U.S. eventually escaped stagflation and won the Cold War. Notably, Trump’s policies are often compared to Reagan’s.
6. Post-Subprime Crisis: Quantitative Easing and Post-Keynesianism
This period is likely most familiar. Loose monetary and regulatory policies fueled globalization-driven growth. Financial innovation—like asset-backed securities—spread risk globally, creating deep financial interconnectivity. Meanwhile, U.S. housing prices rose steadily in the 2000s, seen as safe investments, attracting massive capital.
This convergence created a massive bubble built on subprime mortgages and complex derivatives. When defaults spiked and collateral values plummeted, asset-backed securities collapsed. Dominoes fell—Lehman Brothers’ bankruptcy in 2008 marked the crisis peak, triggering global financial chaos.
The fallout was profound. Public anger grew toward Republican-led deregulation. Mainstream economic thought adapted—post-Keynesianism returned. Neoliberals had long criticized Keynesianism using the “rational economic agent” argument: if policies are predictable, agents adjust behavior in advance, neutralizing policy effects—rendering fiscal stimulus ineffective.
Post-Keynesians revised the framework. Concepts like price and wage stickiness explained lagged policy impacts, while imperfect competition addressed oligopolies distorting market equilibrium. Post-Keynesianism also integrated neoliberal tools—using both monetary and fiscal levers. To overcome monetary policy’s lag, it introduced rational expectations management: leveraging forward guidance from officials to shape rational agents’ expectations, enabling preemptive market influence and improving policy efficacy. Today’s focus on 2% inflation targets and Fed communications stems from this era.
Democratic administrations responded with a “three-arrow” strategy: massive fiscal spending, unconventional quantitative easing, ultra-loose monetary policy, and tighter financial regulation. These measures pulled the U.S. out of crisis—bringing us to the present.
The Return of Neoliberalism Under Trump: Web3 to Lead America’s Next Wave of Financial Innovation
Reviewing the evolution of U.S. economic thought reveals a constant oscillation between government and market. Interventionist theories emphasize state efficacy; market-oriented ones stress allocative efficiency. Given Trump’s formative experiences during the 1970s—the low point of Keynesianism, when Reagan’s neoliberal revival rescued the nation—it’s understandable he seeks a similar path to “Make America Great Again.”
Within Trump’s narrative, Democratic economic policies caused three fatal flaws:
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Massive fiscal stimulus and quantitative easing pushed America into debt crisis;
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Protective policies toward Silicon Valley led to resource misallocation—over-investment in tech at the expense of traditional industries, weakening U.S. manufacturing;
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Government intervention created information asymmetries, enabling cross-sector capital reallocation, widening inter-industry wealth gaps and deepening inequality.
In this context, I argue Trump’s pre-inauguration crypto launch wasn’t merely about personal profit—but a symbolic signal. It aims to position Web3 as the centerpiece of financial innovation within his deregulatory, supply-side reform agenda. The advantages are clear:
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Bypass entrenched interest groups in traditional finance, long cultivated by Democrats;
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Web3’s transparent, trustless, decentralized nature aligns perfectly with neoliberal ideals—removing authoritative intermediaries and letting market mechanisms govern distribution;
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Most Web3 assets are still priced in dollars; expanding their use reinforces dollar hegemony;
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Web3’s censorship resistance enables freer capital flows, circumventing other nations’ financial controls and amplifying U.S. financial dominance.
Of course, such a shift carries significant risks—similar to, but likely greater than, the 2008 crisis. Higher systemic financial risk and vertical wealth redistribution across classes are inevitable. But these consequences will unfold over the medium to long term. In sum, I’m highly intrigued by the direction of financial innovation at the intersection of Web3 and traditional U.S. industries over the next two years—and will continue to monitor developments closely.
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