By Christopher Smart
About the author: Christopher Smart is managing partner of the Arbroath Group, an investment strategy consultancy, and was a senior economic policy advisor in the Obama administration.
If a friend stands ready to give you something you want, should you ask for it politely or grab it from their hands?
This isn't a trick question. It is the puzzle behind the Trump administration's wishes for the territory that most know as Greenland, but that some of the president's congressional supporters hope to rename " Red, White, and Blueland."
President Donald Trump has floated the idea of taking the territory for years. This week he doubled down on that, saying the U.S. "needs Greenland" for its national security. As usual, his provocative remarks seem designed to rattle European leaders just enough to see how far he can push them. But not even Greenland's valuable geographical position and hoards of critical minerals could compensate for damaging the trans-Atlantic alliance that remains fundamental to U.S. security.
Just imagine an escalation of threats that leads to dollar sanctions on Greenland's banks and Danish bans on sales of GLP-1s from its national champion Novo Nordisk. It is just a hop, skip, and jump to Marines scaling the fjords to capture top officials in Nuuk. This may sound far-fetched to Americans, but these are now part of Europe's most vivid nightmares.
To believe that Trump has a formal plan for Greenland is a stretch. But investors need to know whether this is just another round of New World insult and Old World outrage, or whether the wobbly trans-Atlantic relationship now faces the threat of open warfare among NATO powers. Is there money to be made in Greenland as the U.S. and others open a new chapter of international investment and development? Or is the Western alliance heading for collapse?
Secretary of State Marco Rubio told members of Congress this week that Trump intends to "buy" Greenland. This is a fun exercise for anyone with a calculator and a sense of history. President Thomas Jefferson acquired the 828,000-square-mile Louisiana Purchase in 1803 for $15 million, or about $18 per square mile. Secretary of State William Seward paid roughly $12 per square mile of Alaska in 1867. Those comparables would price Greenland between $180-450 million in today's dollars.
After World War II, President Harry Truman secretly offered $100 million in gold to purchase Greenland, as Washington worried about defending North America against Soviet bombers crossing the Arctic Circle. That would be about $1.6 billion today.
Even if Trump presented the U.S. as a buyer, it isn't entirely clear who the seller would be. Greenland is administered by Denmark, which officially incorporated it as a colony in 1815. But Denmark granted it home rule in 1979, and its 57,000 inhabitants retain the right to vote for independence. Polls show Greenlanders' conditional support for independence from Denmark, but overwhelming opposition to joining the U.S.
Even less likely than a purchase is a land invasion. Trump hasn't really threatened the use of force, but he has also explicitly refused to rule it out. European leaders issued a joint statement in high dudgeon on Tuesday, insisting that "Greenland belongs to its people." What really irked them was the obvious statement by Stephen Miller, Trump's deputy chief of staff: "No one is going to fight the U.S. over the future of Greenland."
That seems true enough -- although the U.S. only has about 150 military personnel at the Pituffik Space Base on Greenland's northwest coast, far lower than its peak of 6,000 personnel during the Cold War. Meanwhile, Denmark announced last fall an additional $3.2 billion in military spending to boost Arctic security and another $4.5 billion to buy 16 more F-35 advanced fighters from -- that's right -- the U.S. That isn't just "one more dogsled," as Trump described the Danish defense strategy. Still, it wouldn't take long for the U.S. Navy and Air Force to take whatever it wanted.
This is what makes the implicit U.S. threats so puzzling. Since 1951, Washington and Copenhagen have had a defense agreement that gives the U.S. broad rights to build and operate military bases across Greenland. It was updated in 2004 to involve the island's local government.
The only catch is that Washington must ask permission to expand its activities. Few observers believe local or Danish officials would turn down reasonable requests from Washington, given Europe's shared concerns for Russian naval activity in the North Atlantic and Chinese efforts to secure mining rights in Greenland.
Conceivably, Trump's bluster is intended to make any consultation with Denmark easier. It's also a signal that anyone planning to dig up those rare earths from Greenland's tundra will have Washington's support to overcome any resistance from China or local environmentalists. Maybe it will prod European militaries to take Arctic security more seriously, too.
But as much as Trump may catalyze European action on boosting their military spending, his repeated threats and insults are leaving lasting scars. Nearly half of Europeans polled in November said they consider him an "enemy." Uneven tariffs, wobbly support for Ukraine, and recent intervention in Venezuela are forcing Europe to conduct a fundamental review of their trans-Atlantic alliance.
Trump's reckless cage rattling over Greenland might secure quick concessions, but the long-term costs of doing so may prove too high to calculate. He may find it would have been better to first ask if someone is prepared to give.
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January 08, 2026 10:43 ET (15:43 GMT)
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