• Commerce Secretary Howard Lutnick declared globalization a failed policy during Tuesday panel at World Economic Forum
• European Central Bank President Christine Lagarde walked out of private dinner after Lutnick criticized Europe’s economic performance
• Former Vice President Al Gore booed Lutnick’s remarks questioning Europe’s net-zero targets and Chinese battery dependence

DAVOS, SWITZERLAND (TDR) — U.S. Commerce Secretary Howard Lutnick delivered a scathing critique of globalization to world leaders at the World Economic Forum on Tuesday, urging nations to adopt their own versions of the Trump administration’s America First policy while declaring that decades of offshoring have left Western workers behind.

“We are here to make a very clear point: globalization has failed the West and the United States of America,” Lutnick told politicians, businessmen and global leaders gathered at the annual Davos meeting in Switzerland. “It’s a failed policy. It is what the WEF has stood for — which is export, offshore, far-shore, find the cheapest labor in the world and the world is a better place for it.”

“The fact is it has left America behind. It has left the American workers behind.”

America First Model for All Nations

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Speaking during a panel titled “Prosperity: Sovereign Yet Connected?” alongside Canadian Finance Minister François-Philippe Champagne, UK Chancellor Rachel Reeves, and other global leaders, Lutnick urged other countries to prioritize their own workers through sovereign economic policies similar to those being implemented by President Donald Trump.

“What we are here to say is that ‘America First’ is a different model — one that we encourage other countries to consider — which is that our workers come first [and] we can have policies that impact our workers.”

The Commerce Secretary emphasized that national sovereignty extends beyond borders to include control over critical industries. Countries should not offshore essential sectors like medicines and semiconductors, Lutnick argued, warning against dependence on potentially hostile nations.

“You shouldn’t offshore your medicine. You shouldn’t offshore your semiconductors. You shouldn’t offshore your entire industrial base and have it be hollowed out beneath you. You should not be dependent for that which is fundamental to your sovereignty on any other nation, and if you’re going to be dependent on someone, it darn well better be your best allies.”

Europe’s Net-Zero Policies Draw Sharp Criticism

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Lutnick’s most pointed criticism targeted European nations pursuing net-zero carbon emissions targets despite lacking domestic battery manufacturing capacity, effectively making themselves dependent on China for critical green energy components.

“Why would Europe agree to be net zero in 2030 when they don’t make a battery? They don’t make a battery. So if they go 2030, they are deciding to be subservient to China, who makes the batteries.”

The comments drew sharp reactions from the audience. Former Vice President Al Gore, a longtime climate advocate, booed Lutnick’s remarks at the conclusion of his speech before approximately 200 attendees.

“I sat and listened to his remarks. I didn’t interrupt him in any way,” Gore said in a statement. “It’s no secret that I think this administration’s energy policy is insane. And at the end of his speech I reacted with how I felt, and so did several others.”

Lagarde’s Dramatic Exit from Private Dinner

The tensions escalated further during a private VIP dinner hosted by BlackRock CEO Larry Fink on Tuesday evening, where European Central Bank President Christine Lagarde abruptly walked out during Lutnick’s continued criticism of European economic performance.

According to multiple sources familiar with the matter, Lagarde left the invitation-only dinner attended by more than 100 global leaders as Lutnick mocked European economies for lagging behind the United States. The dinner was cut short before dessert as heckling broke out and other attendees began leaving.

The ECB declined to comment on the incident. The U.S. Commerce Department and World Economic Forum did not immediately respond to requests for comment.

Semiconductor Investment and Economic Strategy

Beyond his criticism of globalization, Lutnick announced ambitious plans for American semiconductor production, revealing the government will pursue $1 trillion in semiconductor investments aimed at capturing 40% of global market share.

“We are going to invest $1 trillion in semiconductors in America, get up to 40% market share, and at least be able to take care of ourselves,” Lutnick said. “If you don’t make chips, you can’t have robots, you can’t have drones, you can’t take care of yourself.”

The Commerce Secretary also revealed the government has taken approximately a 10% equity stake in Intel under federal chip-making incentives, part of broader efforts to bring critical manufacturing back to American soil.

Defending American Economic Leadership

Despite the contentious exchanges, Lutnick maintained that American economic strength benefits the entire world, pushing back against criticism of the administration’s hardball trade tactics and tariff threats.

“When America shines, the world shines. Close your eyes and think of a world without America in it. It becomes pretty dark pretty darn quickly.”

Lutnick pointed to global stock market performance as evidence that Trump’s economic policies haven’t harmed international markets as critics predicted. He noted that world stock markets have risen despite concerns about American tariffs and protectionist measures.

The Commerce Secretary also defended the administration’s interest in acquiring Greenland from Denmark, framing it as vital to American national security interests in the Western Hemisphere, though he declined to elaborate on specific strategies during the panel discussion.

UK Chancellor Reeves pushed back on Lutnick’s criticism, noting that the United States itself depends heavily on China for 90% of critical minerals needed for advanced manufacturing and defense applications.

“90% of your critical minerals come from China. You need to wean yourselves off those,” Reeves countered.

The heated exchanges at Davos underscore growing transatlantic tensions as President Trump pursues aggressive America First economic policies including sweeping tariffs, reshoring incentives, and demands for greater allied contributions to mutual defense. Trump is scheduled to address the World Economic Forum on Thursday.

Can Western nations pursue sovereign industrial policies while maintaining the interconnected trade relationships that have defined the post-Cold War era?

Sources

This report was compiled using information from Lutnick’s official Commerce Department statement on attending Davos, reporting by RealClearPolitics on the WEF panel discussion, Business Today’s coverage of the globalization remarks, Bloomberg’s reporting on Lagarde’s exit, The Hill’s coverage of Al Gore’s reaction, Fox Business on semiconductor investments, Anadolu Agency’s reporting on the dinner incident, and Deseret News coverage of WEF reactions.

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