Latest / Breaking Points with Krystal and Saagar / 5/13/26: GOP Midterm Bloodbath, Trump's Oligarch Trip To China, Prof Pape On China Advancing Rapidly

Transcript

5/13/26: GOP Midterm Bloodbath, Trump's Oligarch Trip To China, Prof Pape On China Advancing Rapidly · Breaking Points with Krystal and Saagar

• 0:00
  Speaker 1: Hey, guys, Saga and Crystal.
• 0:01
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• 0:33
  Speaker 2: So we have some new fairly bombshell reporting from Adam's Intel, which,
• 0:38
  Speaker 2: if I'm not mistaken, Sager is the most accurate polster
• 0:40
  Speaker 2: both in twenty twenty and in twenty twenty four. So
• 0:44
  Speaker 2: let's go ahead and put this piece up on the
• 0:45
  Speaker 2: screen here. With regard to the midterms, so this is
• 0:50
  Speaker 2: what they call the Jerik ballot. They say, just like, okay,
• 0:52
  Speaker 2: Democrat versus Republican, not putting specific candidates in who do
• 0:56
  Speaker 2: you prefer? The Democrats are winning here by fourteen and
• 1:01
  Speaker 2: a half points on the generic ballot for the House.
• 1:05
  Speaker 4: That is a shocking margin.
• 1:08
  Speaker 2: You know, all these all the concerns, justified concerns about
• 1:11
  Speaker 2: the way maps are being redrawn, etc. Like you are
• 1:14
  Speaker 2: not if Democrats are winning the national vote by something
• 1:17
  Speaker 2: approaching fourteen points, there is no amount of map changes,
• 1:22
  Speaker 2: There is no amount of ice at the polls that
• 1:24
  Speaker 2: is that is going to truly be too big to
• 1:26
  Speaker 2: rig in terms of taking control of the House. And
• 1:30
  Speaker 2: you know, poll after poll shows it's not that people
• 1:32
  Speaker 2: love the Democrats. The Democrats have a lot of work
• 1:34
  Speaker 2: to do to reclaim any sort of decent brand with
• 1:37
  Speaker 2: American people. It's just that they are utterly disgusted with
• 1:41
  Speaker 2: the Republicans, with Donald Trump specifically, and Sager, it does
• 1:45
  Speaker 2: have some credibility given the fact not only Atlas's track record,
• 1:51
  Speaker 2: but given what we've seen in all of these special elections.
• 1:54
  Speaker 4: Fifteen points is the.
• 1:55
  Speaker 2: Average roughly the average shift toward Democrats that we've seen
• 2:00
  Speaker 2: in all of these seats. So you know, that gives
• 2:05
  Speaker 2: it some credibility. Again, it's an outlier, I want to
• 2:07
  Speaker 2: make that clear, but it does give those numbers some
• 2:09
  Speaker 2: credibility given that when people have actually gone and voted.
• 2:12
  Speaker 4: This is roughly what we have seen.
• 2:14
  Speaker 1: Let's start with that.
• 2:15
  Speaker 3: So remember, special election is the most predictive of midterms.
• 2:20
  Speaker 3: It is by far going back many, many years for
• 2:23
  Speaker 3: what's actually going to happen. Then we can start to
• 2:25
  Speaker 3: look at some of the polls and their past track record. Now,
• 2:28
  Speaker 3: you're absolutely right, twenty twenty two and twenty twenty four,
• 2:30
  Speaker 3: Atlas Intel was aplus has been two point two points
• 2:34
  Speaker 3: of the general twenty twenty four electorate.
• 2:36
  Speaker 1: It was the most accurate of that year.
• 2:38
  Speaker 3: However, Oh, what we also learned is what is that
• 2:41
  Speaker 3: Iowa Seltzer poll. Traditional track record can be wrong. So
• 2:45
  Speaker 3: let's put all those caveats. But I think whenever you
• 2:47
  Speaker 3: combine the two things, you could say with a general
• 2:50
  Speaker 3: trend in this direction, unless it's some sort of Seltzer esque,
• 2:54
  Speaker 3: you know, crazy misfire. But you know, when I take
• 2:57
  Speaker 3: a look actually at the issue by issue, that's where
• 3:00
  Speaker 3: I really start to see huge problems for the Republicans.
• 3:04
  Speaker 3: Let's put D two up there on the screen from Atlas.
• 3:08
  Speaker 3: Now lead on every major issue. Trump's two strongest areas
• 3:11
  Speaker 3: are D plus nine and D plus seven. This is
• 3:14
  Speaker 3: from immigration and for defense. But at the very very top.
• 3:17
  Speaker 3: This is usual environment and education and healthcare. Democrats usually
• 3:21
  Speaker 3: are there. But this is where it gets interesting. Employment
• 3:25
  Speaker 3: and job market, and inflation and cost of living. Those
• 3:28
  Speaker 3: are two areas for very traditional Republican strongholds. You have
• 3:32
  Speaker 3: plus fifteen plus seventeen Democratic preference, trade policy and tariffs,
• 3:36
  Speaker 3: who also have another shift towards the Democrats at plus
• 3:40
  Speaker 3: thirteen foreign policy, immigration taxes even you have a plus
• 3:44
  Speaker 3: eight crime at plus three for Dems. So you know
• 3:47
  Speaker 3: things are absolutely insane when Dems are getting plus three
• 3:50
  Speaker 3: whenever it comes to crime. Maybe a lot of people
• 3:52
  Speaker 3: are taking all these headlines about these white collar pardons,
• 3:54
  Speaker 3: wouldn't be honestly, wouldn't be surprised to be I'm being
• 3:58
  Speaker 3: dead serious about their thinking.
• 4:01
  Speaker 2: Honestly, the lowest number of white collar prosecutions in history
• 4:05
  Speaker 2: happening right now under them.
• 4:07
  Speaker 1: And there has been our last decline in the murder rates.
• 4:09
  Speaker 3: So if you put those two things together, you're not
• 4:11
  Speaker 3: as worried about violence, then you also have this white
• 4:14
  Speaker 3: collar prosecution.
• 4:15
  Speaker 1: It wouldn't shock me.
• 4:16
  Speaker 3: But I think what it comes down to is a
• 4:19
  Speaker 3: rejection at the mass level, very similar to how the
• 4:23
  Speaker 3: public reacted after Obama was president for a year. There
• 4:26
  Speaker 3: are a lot of reasons largely for that, but it
• 4:28
  Speaker 3: culminated in that huge wipeout, the she lacking of twenty ten.
• 4:33
  Speaker 3: And I think, well, first of all, the problem with
• 4:36
  Speaker 3: this is it all presumes that Trump cares at all
• 4:39
  Speaker 3: about their chances, which it just doesn't seem like they care.
• 4:42
  Speaker 3: Like anybody who cares about their midterm election chances is
• 4:45
  Speaker 3: not saying things which.
• 4:46
  Speaker 1: Would we let our show about.
• 4:47
  Speaker 3: I don't care or think about American's financial situation at all. Right,
• 4:52
  Speaker 3: So this is where I'm like, I genuinely think that
• 4:55
  Speaker 3: they have given up entirely on the domestic front, like completely.
• 4:59
  Speaker 3: This is the only thing that can explain the sheer
• 5:02
  Speaker 3: obsession with Venezuela, fifty first state, the reflecting pool, the ballroom, Iran.
• 5:09
  Speaker 3: That's all they really have any control over. The rest
• 5:12
  Speaker 3: of the party has a political future. He doesn't care.
• 5:15
  Speaker 3: He only cares about the future. But he's going to
• 5:18
  Speaker 3: drag it down with him. Because the one last thing
• 5:20
  Speaker 3: that we have to be clear on with the Republicans
• 5:23
  Speaker 3: is while many people are fleeing the Republican Party in particular,
• 5:27
  Speaker 3: many of these independent or Norse swing voters, not just
• 5:30
  Speaker 3: swing non identified Trump voters. The actual Republican base is
• 5:35
  Speaker 3: all in for Trump. I mean, do you remember these
• 5:37
  Speaker 3: very recently these Indiana Senate races that were happening where
• 5:41
  Speaker 3: a lot of some of these Indiana Republicans cross Trump.
• 5:44
  Speaker 1: They all lost.
• 5:44
  Speaker 3: Okay, So the actual MAGA people, they're still all in.
• 5:48
  Speaker 3: And that's just a caveat that I want to make
• 5:51
  Speaker 3: very clear, like Trump is still the chief of the declining.
• 5:55
  Speaker 3: In fact, it might be more powerful because at this point,
• 5:58
  Speaker 3: if you're still all in for Trump, there's literally nothing
• 6:00
  Speaker 3: he can do, including shooting someone on Fifth Avenue, for
• 6:03
  Speaker 3: which they will decline. And so that actually leads a
• 6:06
  Speaker 3: very good place I think for the Democratic Party.
• 6:09
  Speaker 1: I would compare it.
• 6:11
  Speaker 3: I'm trying to think maybe the nineteen seventies, where like
• 6:14
  Speaker 3: McGovern this is a good example. So the nineteen seventies,
• 6:17
  Speaker 3: the entire post Watergate Democratic Party was having a tough time,
• 6:23
  Speaker 3: especially after Jimmy Carter kind of figuring out like what
• 6:27
  Speaker 3: we're going to do. And what they did is it
• 6:29
  Speaker 3: opened up this huge space for remember the Reagan Democrat
• 6:33
  Speaker 3: that was like a thing back in the nineteen eighties.
• 6:36
  Speaker 3: Really what it was was an inverse rejection of kind
• 6:40
  Speaker 3: of the embrace of the new Left and this identitarian
• 6:43
  Speaker 3: This is this Democratic Party which had no real identity.
• 6:46
  Speaker 3: There was a very hardcore base of people who supported it,
• 6:49
  Speaker 3: but not enough to create like a majority coalition, which
• 6:52
  Speaker 3: is really what all these people decided to do when
• 6:53
  Speaker 3: they voted for Reagan, even if some of them even
• 6:55
  Speaker 3: didn't agree with their policy. I would compare it now
• 6:58
  Speaker 3: to the other So we have a very very small
• 7:00
  Speaker 3: life of the country which is still very much all
• 7:02
  Speaker 3: in and believing, But it leaves all of this open
• 7:06
  Speaker 3: negative polarization space, which is the defining politics of our era,
• 7:10
  Speaker 3: towards the Democratic Party. They not like them, but they
• 7:12
  Speaker 3: don't like the Republicans at all. It kind of very
• 7:15
  Speaker 3: similar to the twenty twenty four dynamic. A lot of
• 7:17
  Speaker 3: voters hated Biden, they didn't love Trump, they didn't like
• 7:20
  Speaker 3: a lot of things about him. He still had a
• 7:22
  Speaker 3: negative approval rating. We're still willing to vote for him
• 7:24
  Speaker 3: in the end.
• 7:25
  Speaker 2: Yeah, I mean, you could also potentially compare it to
• 7:28
  Speaker 2: depending on how bad things get here with the Iran
• 7:30
  Speaker 2: war and a possible global depression, you could also compare
• 7:33
  Speaker 2: it with Herbert Hoover, you know, and we're not there yet.
• 7:36
  Speaker 1: We're not there, but.
• 7:38
  Speaker 4: That's a possibility, you know.
• 7:40
  Speaker 2: I mean, but that requires having that FDR like figure
• 7:44
  Speaker 2: who can have a really broad appeal centered around, you know,
• 7:48
  Speaker 2: a sort of not only national patriotism, but also prospera
• 7:53
  Speaker 2: broadly shared prosperity was really the cornerstone of what he offered.
• 7:57
  Speaker 2: Obviously within the context that there's not completely shared by
• 8:02
  Speaker 2: Black Americans, certainly in Japanese tournament. Can't all the caveats notwithstanding,
• 8:06
  Speaker 2: and very significant caveats at that. But you know, if
• 8:09
  Speaker 2: you had that type of figure, I do think there's
• 8:12
  Speaker 2: a possibility for that sort of coalition coming together. You know,
• 8:16
  Speaker 2: we get very used to this very narrow partisan victories
• 8:22
  Speaker 2: when you have both politicians basically sort of playing to
• 8:25
  Speaker 2: the culture wars and not really promising significant economic change
• 8:29
  Speaker 2: in a way that's credible. And that that part the
• 8:31
  Speaker 2: way that's credible is the most significant part, because one
• 8:34
  Speaker 2: of the biggest questions is whether you can get Americans
• 8:36
  Speaker 2: to really believe in a big national project of any sort,
• 8:40
  Speaker 2: given the level of humiliation and decline that we're suffering
• 8:43
  Speaker 2: right now.
• 8:43
  Speaker 4: But in any case, you know, all.
• 8:45
  Speaker 2: Of this, So you've got Republicans falling apart in terms
• 8:49
  Speaker 2: of the national standing. Certainly the Trump coalition has broken down,
• 8:52
  Speaker 2: has hard to score. Supporters are always going to be
• 8:54
  Speaker 2: there with him, but it is a minority is somewhere
• 8:57
  Speaker 2: around a third of the population that is obviously not
• 8:59
  Speaker 2: nearly have to win house elections when you know, even
• 9:03
  Speaker 2: maintain control of the Senate, let alone hold onto the presidency.
• 9:06
  Speaker 2: In twenty twenty eight, this poll from Atlas Intel was
• 9:08
  Speaker 2: also very interesting on the Democratic side and very different
• 9:13
  Speaker 2: from what we've seen on other Democratic primary twenty twenty eight,
• 9:17
  Speaker 2: you know, trial run. So let's put this up on
• 9:19
  Speaker 2: the screen. This is the first one that we've seen
• 9:22
  Speaker 2: AOC leading the field with twenty six percent of the vote.
• 9:26
  Speaker 2: Next in line, you've got Pete at twenty two, Gavin
• 9:29
  Speaker 2: at twenty one, Kamala down at thirteen, and then everybody
• 9:32
  Speaker 2: else is pretty far below that. Andy Vasher four, Corey
• 9:35
  Speaker 2: Booker for none of the above, three, Shapiro two, Whitmer one,
• 9:39
  Speaker 2: Walls one, Kana one, Ram Emanuel point six, and Wesmore
• 9:44
  Speaker 2: point four. So look, again it's an outlier, but it
• 9:49
  Speaker 2: does add an interesting data point. AOC is very much
• 9:53
  Speaker 2: seen as the you know, the air to Bernie Sanders.
• 9:56
  Speaker 2: She is the scene as the vanguard of the left
• 9:59
  Speaker 2: of the party and in the sort of inheritor of
• 10:03
  Speaker 2: that legacy. What we've seen in primary contests around the country,
• 10:07
  Speaker 2: and actually, if we can jump forward and put Abdul's
• 10:10
  Speaker 2: numbers up here on the screen here D five, is
• 10:12
  Speaker 2: that the energy in the Democratic Party is very much
• 10:15
  Speaker 2: with the left of the party in a.
• 10:17
  Speaker 4: Way that it truly in.
• 10:20
  Speaker 2: Our lifetimes has never been, including during the times when
• 10:24
  Speaker 2: Bernie Sanders was running, where people liked Bernie, but they
• 10:27
  Speaker 2: were worried as the electable ato now and there was
• 10:30
  Speaker 2: kind of a limit to how far people were willing
• 10:33
  Speaker 2: to go in terms of voting for him or voting
• 10:34
  Speaker 2: for candidates who styled themselves in his image. That seems
• 10:38
  Speaker 2: to be changing. We now have in the Michigan Senate race,
• 10:42
  Speaker 2: am Dee La Sayed is really surging here. We've got
• 10:45
  Speaker 2: a new poll that has him emerging as the race's
• 10:48
  Speaker 2: clear front runner twenty eight percent support, ahead of Hailey
• 10:52
  Speaker 2: Stevens at eighteen and State Center Mallory McMorrow at seventeen percent,
• 10:56
  Speaker 2: So they're basically in a tie for second, and this
• 10:59
  Speaker 2: is really stunning. They have him getting eighty percent of
• 11:04
  Speaker 2: the support of voters between the ages of eighteen and
• 11:08
  Speaker 2: forty four, so gen z and millennials eighty percent support.
• 11:13
  Speaker 2: Stevens is getting four percent, and mcmorrow's getting three percent,
• 11:17
  Speaker 2: so massive, massive generational divide. In terms of the view
• 11:21
  Speaker 2: of this race, we can also look in terms of
• 11:24
  Speaker 2: that left energy dominating the base of the party, certainly
• 11:27
  Speaker 2: grand platin or coming out of nowhere, having never run
• 11:30
  Speaker 2: for anything before, and easily dispatching with the sitting governor
• 11:35
  Speaker 2: of Maine who was backed by the establishment of the
• 11:38
  Speaker 2: Democratic Party. So you know, this poll showing AOC in
• 11:42
  Speaker 2: the lead fits with that trend of voters in the
• 11:45
  Speaker 2: base of the party looking around and going, okay, well,
• 11:48
  Speaker 2: who is who is aligned with that Sanders wing? Who
• 11:51
  Speaker 2: is going to you know, who is going to stand
• 11:53
  Speaker 2: up to corporate interests? Who is going to be different?
• 11:56
  Speaker 2: And you know, I've got my concerns about AOC that
• 12:00
  Speaker 2: I've voiced on this show previously, but in terms of
• 12:03
  Speaker 2: voter perception of who she is and what her branding is,
• 12:06
  Speaker 2: I think it's very consistent with the energy that we've
• 12:09
  Speaker 2: seen behind Abdulah Sayad and Graham Platter.
• 12:11
  Speaker 3: It is interesting. Yeah, I don't know. I just don't
• 12:14
  Speaker 3: see her coming out of primary. I don't She's not
• 12:17
  Speaker 3: a good debater. She folded in Munich. She doesn't really.
• 12:21
  Speaker 3: I don't know what was the analogy you made about
• 12:23
  Speaker 3: She always seems like she's studying for the test and
• 12:26
  Speaker 3: looking for the right answer as opposed to having an
• 12:28
  Speaker 3: answer that she already.
• 12:30
  Speaker 1: That's really important for a politician.
• 12:32
  Speaker 3: A lot of it right now is the idea of
• 12:34
  Speaker 3: AOC as opposed to the power.
• 12:36
  Speaker 1: Shot right, and with you.
• 12:38
  Speaker 3: You can't get through primary through something like that, especially
• 12:41
  Speaker 3: if you're going to be challenged.
• 12:42
  Speaker 1: You know.
• 12:42
  Speaker 3: The one thing that I think this whole thing presumes
• 12:44
  Speaker 3: is that Kama is not going to run again, which
• 12:46
  Speaker 3: I am not putting off the table.
• 12:48
  Speaker 2: She's very really they have her in there, and she's
• 12:51
  Speaker 2: led most of the polls she has led for Democratic
• 12:55
  Speaker 2: primary trial and that's why this one is different. But
• 12:58
  Speaker 2: it had her at thirteen percent, so still you know,
• 13:01
  Speaker 2: garnering some support. But you know, I'm look, I'm not
• 13:06
  Speaker 2: that concerned for the same reason you're saying, like you
• 13:09
  Speaker 2: don't think AOC can come through a primary.
• 13:10
  Speaker 4: I mean, I think Kamala.
• 13:14
  Speaker 2: Proven herself too well under a public scrutiny, So you know,
• 13:20
  Speaker 2: I think even though people she'll be able to come
• 13:23
  Speaker 2: out and say, look, I warned you that I said
• 13:24
  Speaker 2: this about Trump, and I was right.
• 13:26
  Speaker 4: Like I warned you, I tried.
• 13:27
  Speaker 2: To tell you, and there is an like there continues
• 13:31
  Speaker 2: to be a lot of warm feelings towards her, you know,
• 13:35
  Speaker 2: in certain parts of the party, but I'm not personally
• 13:39
  Speaker 2: that concerned with that translating into Kamala Harris primary.
• 13:43
  Speaker 4: The last thing I don't think she'll hold up to
• 13:45
  Speaker 4: scrutiny one.
• 13:46
  Speaker 3: The last thing on flag, because we have our guest
• 13:47
  Speaker 3: ending of mine, is the primary calendar matters so much.
• 13:50
  Speaker 3: It matters so much how that primary calendar is going
• 13:53
  Speaker 3: to look like. And as far as I know you
• 13:55
  Speaker 3: can tell me, I don't think that it's yet set
• 13:57
  Speaker 3: in stone. But if they go the traditional route, or
• 14:00
  Speaker 3: at least the Biden route where they wanted South Carolina
• 14:02
  Speaker 3: and first and without any of the Rust Belt or Nevada,
• 14:06
  Speaker 3: any of these places where Bernie did really well, remember,
• 14:09
  Speaker 3: it can significantly skew the way things go. And I
• 14:12
  Speaker 3: wouldn't put it past the DNC after what they've pulled
• 14:15
  Speaker 3: with is Biden autopsy and everything that they've done. And
• 14:19
  Speaker 3: I mean, remember before what's your name Mills dropped out
• 14:23
  Speaker 3: against Plattner, the Shumer in them were going all in
• 14:27
  Speaker 3: for them. So I would not put it past them
• 14:30
  Speaker 3: whatsoever to nominate or to rig the scales, rig the
• 14:34
  Speaker 3: system in favor of a Gavin Or or Kamala if
• 14:37
  Speaker 3: it were somebody like that. So that's my last flag
• 14:40
  Speaker 3: for people's because it's so.
• 14:42
  Speaker 4: They're going to try. They're going to try.
• 14:44
  Speaker 2: I just think it's going to be difficult to do
• 14:47
  Speaker 2: what they did in the past because just like with
• 14:49
  Speaker 2: the Mills race, people are like, oh, you're Shoomer's candidate,
• 14:51
  Speaker 2: and that means I'm definitely not voting for you. And
• 14:54
  Speaker 2: the ability to manufacture consent with the media outlets is
• 14:57
  Speaker 2: really severely degraded to by the rise of independent and
• 15:00
  Speaker 2: also by the degradation of trust in mainstream liberal outlets.
• 15:04
  Speaker 1: So good point.
• 15:05
  Speaker 3: All right, I've got our guest standing by I'm going
• 15:07
  Speaker 3: to do this on solo because he's in the studio,
• 15:09
  Speaker 3: and then Krystal's gonna be back on whenever we're with
• 15:11
  Speaker 3: Robert Pape, so we'll see you then.
• 15:15
  Speaker 1: Joining us now is Andy Brown.
• 15:16
  Speaker 3: He is the semaphore China columnist, an expert who's going
• 15:19
  Speaker 3: to join us here for the Trump Gee Some.
• 15:20
  Speaker 1: It's good to see you, thanks for joining.
• 15:22
  Speaker 5: Us, Thanks for having me.
• 15:23
  Speaker 3: Absolutely so we're going to start off just as you
• 15:25
  Speaker 3: and I are talking. President Trump on the ground Beijing.
• 15:28
  Speaker 3: Let's take a look at it. He's coming in the
• 15:30
  Speaker 3: middle of the night. You can see him there in
• 15:32
  Speaker 3: a grand arrival ceremony. The Vice President I believe, or
• 15:35
  Speaker 3: is it Premier of China, I forget, one of the
• 15:37
  Speaker 3: vice somethings of China greeted him there on the red carpet,
• 15:40
  Speaker 3: and he's got a full two days schedule ahead of him.
• 15:44
  Speaker 3: The most interesting news Andy that's come out is on
• 15:47
  Speaker 3: his way to Air Force one, President Trump actually put
• 15:50
  Speaker 3: out a truth social post, which we will have here.
• 15:54
  Speaker 1: I'm going to go ahead and read from some of it.
• 15:56
  Speaker 3: CNBC incorrectly reported that the Great gens en wang En
• 15:59
  Speaker 3: video was not invited to the incredible gathering of the
• 16:02
  Speaker 3: world's businessman. He is currently on Air Force one unless
• 16:05
  Speaker 3: I ask him to leave, which is highly unlikely. He
• 16:07
  Speaker 3: lists the others it Is Jensen, Elon, Tim Apple, Larry Fink,
• 16:12
  Speaker 3: Steven Schwartzman, Kelly orderber Boeing. He listened in parentheses, Brian
• 16:16
  Speaker 3: Sykes of Cargill, Jane Fraser of City Bank, Larry Kulp
• 16:19
  Speaker 3: ge Aerospace, David Solomon, Goldman, snacks Son, Jay Maholdra Micron,
• 16:24
  Speaker 3: Cristiano Aman from Qualcomm, and many others, including Brett Ratner,
• 16:28
  Speaker 3: the Hollywood director. So I have described this as some
• 16:33
  Speaker 3: kind of nineteenth century trade mission, like where the Brits
• 16:36
  Speaker 3: would come with the monarch and the oligarchs with exactly
• 16:40
  Speaker 3: the McCartney mission. And so you can google that if
• 16:44
  Speaker 3: you don't know what we're talking about. But what's your
• 16:46
  Speaker 3: modal like view of how this? I mean, it's extraordinary.
• 16:50
  Speaker 3: You've never seen a president of the United States go
• 16:53
  Speaker 3: with very few NSC members or any of that on
• 16:56
  Speaker 3: the China desk and instead have half of Air Force
• 16:59
  Speaker 3: one be the richest, most powerful CEOs here in the
• 17:02
  Speaker 3: United States.
• 17:03
  Speaker 5: Well, first of all, let's hope it's not the McCartney mission,
• 17:05
  Speaker 5: because the end result of the McCartney mission was the
• 17:07
  Speaker 5: Chinese Emperor saying to Lord McCartney, we don't want anything
• 17:11
  Speaker 5: that you're offering right right, So it's hilarious. Actually, Memes
• 17:16
  Speaker 5: all over social Chinese social media today showing Jensen in
• 17:20
  Speaker 5: his leather jacket racing down the wrong way after Air
• 17:24
  Speaker 5: Force one, grabbing hold of the wheels as it takes off.
• 17:28
  Speaker 5: I mean, he's a rock star in China. It's not true.
• 17:31
  Speaker 5: I mean, of course he was. First, there was a list,
• 17:33
  Speaker 5: they put out a list. He wasn't on the list.
• 17:36
  Speaker 5: I can kind of see why a Jamison Greer at
• 17:40
  Speaker 5: USTR might not want him in the party. I mean,
• 17:45
  Speaker 5: if you look at the composition, okay, of the companies
• 17:49
  Speaker 5: in that delegation, You've got start off with the finance
• 17:53
  Speaker 5: of the Wall Street guys, Right City, Goldman City, Jane Fraser.
• 17:57
  Speaker 5: These are people that basically want to look after Chinese money,
• 18:01
  Speaker 5: look after Chinese money inside China, look after Chinese money
• 18:04
  Speaker 5: when it leaves China for investment, travel, credit card, credit
• 18:07
  Speaker 5: card companies that are not controversial, they're already embedded into
• 18:11
  Speaker 5: China and really want to do more business there. You've
• 18:14
  Speaker 5: got the agricultural people, right, so the cargos of this
• 18:17
  Speaker 5: world that is selling sawyer beans and beef to China
• 18:22
  Speaker 5: unambiguously good for the US economy, good, good for farmers
• 18:26
  Speaker 5: must be there. Then you get into technology. Some parts
• 18:32
  Speaker 5: of technology are less problematic than others. So you know
• 18:36
  Speaker 5: Tim Apples, as he's called, making his iPhones in China.
• 18:41
  Speaker 5: That's okay. There's a lot of value here in the
• 18:43
  Speaker 5: United States on the design side, on the marketing side,
• 18:46
  Speaker 5: and so on. Elon Musk is there. He's making EV's
• 18:49
  Speaker 5: what more problematic because actually he was the flywheel for
• 18:52
  Speaker 5: the entire Chinese EV industry, but he's not selling them
• 18:55
  Speaker 5: back to the United States. That's okay, one hundred percent tariffs.
• 18:59
  Speaker 5: Then you get into semiconductors. Okay, that is the most problematic,
• 19:05
  Speaker 5: most troublesome area of US child. That is where these
• 19:09
  Speaker 5: two superpowers compete. It's all about AI. AI is all
• 19:14
  Speaker 5: about compute. Compute comes from chips. It's hard to imagine
• 19:19
  Speaker 5: anything coming out on the chip side that won't be controversial.
• 19:24
  Speaker 5: Let's say let's say that C Jimping when he meets
• 19:27
  Speaker 5: with Trump, says, okay, you know, we'll we'll we'll take
• 19:30
  Speaker 5: video chips. Trump is already offered, Yeah he has right,
• 19:35
  Speaker 5: I mean he wants a cut, right, twenty five percent
• 19:37
  Speaker 5: of or anything Jensen sells in in China. But let's
• 19:40
  Speaker 5: say let's say let's say they do a deal, comes
• 19:42
  Speaker 5: back to the US hale of criticism. You've just given
• 19:45
  Speaker 5: it all away and actually quite quite understand. What if,
• 19:48
  Speaker 5: on the other hand, they don't do a deal, then
• 19:51
  Speaker 5: this is going to overshadow the trip. Oh C jimping
• 19:53
  Speaker 5: rejects some you know, some one one way or another
• 19:56
  Speaker 5: is very difficult. Plus this is so complicated. There's nothing
• 20:00
  Speaker 5: that these two leaders are going to sort out over
• 20:03
  Speaker 5: chips and and Nvidia is sitting around the two days
• 20:07
  Speaker 5: two days, right. I mean, you can't do that over
• 20:09
  Speaker 5: a cup of tea at the Great Hole of the People.
• 20:12
  Speaker 5: But what you can do over a cup of tea
• 20:14
  Speaker 5: is make an agreement on what they call the three
• 20:16
  Speaker 5: bees Boeing, beef and beans.
• 20:19
  Speaker 3: Right, So what I'm really interested in is what's what
• 20:23
  Speaker 3: e three up here on the screen? And your colleague
• 20:26
  Speaker 3: Ben Smith I was texting him this morning. I think
• 20:28
  Speaker 3: he wrote one of the most prescient columns on China
• 20:30
  Speaker 3: I've seen in quite a long time. I'm curious for
• 20:32
  Speaker 3: your own view where he said, you know that this
• 20:35
  Speaker 3: Trump is poised to end the Washington decade of the Chinahawks.
• 20:38
  Speaker 3: And so when I see Trump, first of all in
• 20:41
  Speaker 3: that true social post, there was another word that he used,
• 20:43
  Speaker 3: open up right, open up China. This is the president
• 20:47
  Speaker 3: who ran against PNTR permanent normal relations with China. This
• 20:51
  Speaker 3: is the president who wanted to reform our trading relationship
• 20:53
  Speaker 3: with China. This time around, you have those oligarchs who
• 20:56
  Speaker 3: are all on board Air Force one. You just laid
• 20:58
  Speaker 3: out very you know, eloquently, all the various business interests,
• 21:01
  Speaker 3: but this is one which is shaping up for potential.
• 21:03
  Speaker 3: What Bloomberg reports here some sort of trillion dollar investment deal.
• 21:07
  Speaker 3: And if we look into Trump's psychology, this is something
• 21:10
  Speaker 3: he needs, probably more desperately now than ever, considering where
• 21:13
  Speaker 3: the economy is. He did this with Japan, he did
• 21:15
  Speaker 3: this with Korea, he did this with the European Union.
• 21:18
  Speaker 3: He needs the headline China agrees one trillion dollar investment.
• 21:23
  Speaker 3: So you mentioned potential deals on semiconductors. Another one I'm
• 21:26
  Speaker 3: tracking closely as autos. That's another reason I think Elon
• 21:29
  Speaker 3: might be there, some sort of licensing technology scheme. But
• 21:32
  Speaker 3: a curious first of all, from that high level view
• 21:35
  Speaker 3: of like this is the literal opposite of what a
• 21:38
  Speaker 3: lot of people thought was going to happen back in
• 21:40
  Speaker 3: two thousands.
• 21:40
  Speaker 5: Well, it's a literal opposite of what some of the
• 21:43
  Speaker 5: people on Air Force. Yeah, you're right, yeah, saying their
• 21:46
  Speaker 5: entire careers. Yes, not lis Marco Rubio, Yeah, you're right.
• 21:49
  Speaker 5: The Secretary of State who was a China hulk until
• 21:53
  Speaker 5: he joins the Trump the Trump administration. It is amazing, right,
• 21:57
  Speaker 5: So you know, you got to remember Trump is the
• 21:59
  Speaker 5: guy who really changed the game with China. Yes, so
• 22:03
  Speaker 5: before Trump, all the way back to Nixon, you have
• 22:06
  Speaker 5: presidents who've gone after engagement. Right, we want to make
• 22:10
  Speaker 5: the Chinese look more like US commercially. We wanted to
• 22:13
  Speaker 5: play by the rules of the game, the rules of
• 22:14
  Speaker 5: the United States set after World War Two, integrate them
• 22:18
  Speaker 5: into the global system. He broke that consensus in his
• 22:22
  Speaker 5: first term. He came in, they're raping us, they're pillaging us,
• 22:27
  Speaker 5: they're making fun of us, they're cheating, lying, and so on.
• 22:30
  Speaker 5: It was China, China, China, right. So he puts in
• 22:32
  Speaker 5: place a whole system of tariffs, export controls, sanctions against
• 22:38
  Speaker 5: Chinese companies. He tries to kill a Huawei, the avatar
• 22:43
  Speaker 5: of China's technology ambitions doesn't work, and then things go
• 22:48
  Speaker 5: from bad to worse at the end of his administration.
• 22:50
  Speaker 5: Do you remember during COVID blame it on China. It
• 22:54
  Speaker 5: was the lab China, the kung flu kung flu is
• 22:58
  Speaker 5: as he calls it. H And so, you know, he
• 23:01
  Speaker 5: comes into his he comes into his second term and
• 23:05
  Speaker 5: he starts reassembling that sort of group of China Hawks
• 23:08
  Speaker 5: within the National Security Council, the people with a similar
• 23:13
  Speaker 5: mindset to the people that he that he'd gathered in
• 23:16
  Speaker 5: his first administration. And he does this, he does this
• 23:19
  Speaker 5: u turn and he gets rid of them all. He
• 23:21
  Speaker 5: gets rid of all the China Hawks, marginalizes the National
• 23:25
  Speaker 5: Security Council, and then since since then, he's just worked
• 23:29
  Speaker 5: incredibly hard doing everything he can to do a deal
• 23:33
  Speaker 5: with China, which includes, as we just mentioned, saying, okay
• 23:38
  Speaker 5: to you know, you can have our most advanced or
• 23:41
  Speaker 5: some of them are very advanced chips national security document.
• 23:46
  Speaker 5: They bring that to him. It's all written out boiler
• 23:48
  Speaker 5: plate about our China is a threat in major competitive
• 23:54
  Speaker 5: adversary and so on. And Trump looks at this and
• 23:56
  Speaker 5: he's around, no, no, no, no, no, that's not that's not
• 23:59
  Speaker 5: what I wanted blue pencils. All this comes back to
• 24:02
  Speaker 5: his desk and those all kinds of language about how
• 24:04
  Speaker 5: we want, you know, an honorable piece. I think peg
• 24:07
  Speaker 5: Sath talks about everlasting piece with China, So it's all flip.
• 24:12
  Speaker 5: People say he is the most China friendly member of
• 24:15
  Speaker 5: his own administrative I.
• 24:16
  Speaker 1: Think it's true.
• 24:17
  Speaker 3: That's true, and I think what it reflects is this
• 24:19
  Speaker 3: business instinct, especially now to dig himself out of the
• 24:22
  Speaker 3: hole that he created, not just with tariffs, now the
• 24:24
  Speaker 3: Iran War. I mean you need something. I also I'm
• 24:27
  Speaker 3: curious for your view, how do the Chinese view it?
• 24:29
  Speaker 3: Because this is now Remember this summit has been postponed
• 24:32
  Speaker 3: as a result of the Iran War. I don't think
• 24:34
  Speaker 3: America has ever been strategically this is my opinion. I
• 24:35
  Speaker 3: don't think we've ever been strategically weaker than after this conflict,
• 24:39
  Speaker 3: not only in terms of the standoff munitions that have
• 24:41
  Speaker 3: all been expended, but just the sheer inability of the
• 24:44
  Speaker 3: United States Navy to even open the Strait of Hormuz.
• 24:47
  Speaker 3: If you're a Shishiping in the PLA, you're watching this
• 24:49
  Speaker 3: with glee and so at a moment and the summit
• 24:52
  Speaker 3: like this, what is China looking at? So I'd read
• 24:55
  Speaker 3: some stories I see China trying to you know, they're
• 24:57
  Speaker 3: warning Meta of an acquisition there, telling their companies, the
• 25:01
  Speaker 3: teapot refineries. They're saying, yeah, we're not listening to this.
• 25:04
  Speaker 3: US sanctions nonsense. All of these are signals. So what
• 25:08
  Speaker 3: is she's objective in a summit like this?
• 25:11
  Speaker 5: She's number one, two and three objective is Taiwan. So
• 25:16
  Speaker 5: he thinks that he has leverage because as you say,
• 25:20
  Speaker 5: well he does coming in he does right that. You know,
• 25:23
  Speaker 5: the latest peace agreement proposal has collapsed in a huge,
• 25:29
  Speaker 5: huge mass straight up moves more or less closed, big
• 25:33
  Speaker 5: pressure on the years ago, and we just saw the
• 25:34
  Speaker 5: inflation numbers, prices going, prices going up, a real threat
• 25:38
  Speaker 5: in the in the midtims. She sees all this, So
• 25:42
  Speaker 5: he sees that as leverage to get concessions on Taiwan.
• 25:46
  Speaker 5: So he wants that. Yeah, he wants he wants tariff
• 25:50
  Speaker 5: scale back, he wants US technology, he wants Chinese companies
• 25:55
  Speaker 5: off these blacklist Pentagon black list. He wants more acts
• 26:01
  Speaker 5: to US technology. But Taiwan is number one.
• 26:04
  Speaker 3: Number one ass So what whenever we say Taiwan, he wants,
• 26:08
  Speaker 3: what an end to the Taiwan consensus, because I've seen
• 26:10
  Speaker 3: some senators sending Trump letters, Hey, you can't just you know,
• 26:13
  Speaker 3: stop from Taiwan. The Taiwan's Relations Act is locke Trump clearly.
• 26:16
  Speaker 3: I mean, I think he's reported in twenty saying something like,
• 26:19
  Speaker 3: there's not a fucking thing we can do about it.
• 26:21
  Speaker 5: We're not just allowed to say that on a podcast.
• 26:23
  Speaker 1: Oh yeah, yeah, listen, there's no cable, no FCC. You
• 26:26
  Speaker 1: can say whatever you want.
• 26:28
  Speaker 3: So yeah, I mean, in terms of Trump's mindset, I
• 26:30
  Speaker 3: don't think he particularly cares at this point. I think
• 26:32
  Speaker 3: he's all about business in the age of Iran it
• 26:35
  Speaker 3: there actually is.
• 26:36
  Speaker 1: Literally not a fucking thing you can do about it.
• 26:38
  Speaker 3: So I'm curious, like from Trump's and the defense perspective,
• 26:43
  Speaker 3: like what, because usually a China and a US summit
• 26:47
  Speaker 3: is all about defense, trade would be secondary.
• 26:49
  Speaker 1: The Taiwan is number one for the Chinese.
• 26:51
  Speaker 3: Here, it seems Trump is a lot more desperate to
• 26:53
  Speaker 3: get some sort of business accommodation than anything having to
• 26:56
  Speaker 3: do with defense, despite the fact that hegsett is there.
• 26:59
  Speaker 5: On the trip, right, So the easiest way to get
• 27:01
  Speaker 5: a business deal with she is to give something away
• 27:03
  Speaker 5: on Taiwan, right, I don't think there is that. The
• 27:08
  Speaker 5: Chinese expect that Trump is going to sit there ripping
• 27:11
  Speaker 5: up the Taiwan relations. And you can't do it anyway
• 27:13
  Speaker 5: because it's an act of Congress. He's not going to
• 27:16
  Speaker 5: give away Taiwan, right. He is not the He's not
• 27:18
  Speaker 5: going to go down in history as the president who
• 27:21
  Speaker 5: you know, handed Taiwan over to authoritarian China. That's not
• 27:24
  Speaker 5: going to happen, And that's not what the Chinese are expecting.
• 27:27
  Speaker 5: I think what they want out of him is a
• 27:31
  Speaker 5: little tweak in the language. She's going to sit down
• 27:35
  Speaker 5: with him and he's going to explain the problem he's
• 27:37
  Speaker 5: just had. By the way, the head of the the
• 27:38
  Speaker 5: Guaman Danga, the opposition, I saw that coming over coming
• 27:41
  Speaker 5: over shot China. Yeah, amazing. Right, So you know he's
• 27:44
  Speaker 5: he thinks he's got her in his back pocket, and
• 27:46
  Speaker 5: to an extent he has. She's she's already parroting Chinese
• 27:50
  Speaker 5: talking points, right, So that gives him some hope that
• 27:53
  Speaker 5: there's a resolution to his Taiwan, his Taiwan problem. So
• 27:58
  Speaker 5: he wants Trump to tweak the language, right, So he
• 28:00
  Speaker 5: wants Tom to say things like and it doesn't actually
• 28:03
  Speaker 5: even have to write it down. He could just say
• 28:04
  Speaker 5: this to she, you know, we do not support or
• 28:08
  Speaker 5: we are opposed to Taiwan independence, or yeah, we think
• 28:15
  Speaker 5: unification of Taiwan with the mainland is a good IDEA
• 28:20
  Speaker 5: small concession, and you might argue not a big deal.
• 28:25
  Speaker 5: It goes down like a seismic shock in Taiwan because
• 28:29
  Speaker 5: what it says to the people of Taiwan is we're
• 28:32
  Speaker 5: on the table right, we're negotiating chip And that is
• 28:37
  Speaker 5: exactly what She Jingping wants. He wants to get inside
• 28:42
  Speaker 5: Taiwanese heads. He wants to demoralize them. He wants to
• 28:45
  Speaker 5: give them the sense that they don't own their future,
• 28:48
  Speaker 5: that their future is going to be negotiated between the
• 28:50
  Speaker 5: United States and China over their heads. Yes, and then
• 28:53
  Speaker 5: they run up the white run up the white flag.
• 28:55
  Speaker 5: The signal that then sends to the rest of the
• 28:58
  Speaker 5: region is my god, if he's going to put Taiwan
• 29:00
  Speaker 5: on the table, what about us? Right? The Japanese, That's
• 29:03
  Speaker 5: what I've been writing about. The Japanese, the Koreans, they
• 29:07
  Speaker 5: all have big problems, which now, look, they all trade
• 29:10
  Speaker 5: with China, and don't get me wrong, a lot right
• 29:13
  Speaker 5: they want US China, they want US China relations broadly
• 29:16
  Speaker 5: to be okay. That they don't want it to be
• 29:18
  Speaker 5: so okay that they formed this kind of G two condominium,
• 29:23
  Speaker 5: lauded over the whole world and sell out their interests.
• 29:26
  Speaker 5: You know, China right now has sanctions on Japan. I
• 29:30
  Speaker 5: know forty Japanese companies. It's intimidating. It's intimidating Japan on
• 29:36
  Speaker 5: these around these disputed islands right, same with same with
• 29:40
  Speaker 5: South Korea. So that is what Asia Pacific countries are
• 29:43
  Speaker 5: looking at. What is he going to give away to
• 29:47
  Speaker 5: get his precious trade deals?
• 29:49
  Speaker 3: That's my last question. Japan and South Korea already relations
• 29:53
  Speaker 3: are strained. The trade it was a big problem. We
• 29:55
  Speaker 3: didn't I wish we'd spent even more time covering it,
• 29:58
  Speaker 3: but that really pissed a lot of people off. The
• 29:59
  Speaker 3: way that the tariffs and things went down caused big
• 30:02
  Speaker 3: problems in Japan, big problems in South Korea. Then the
• 30:05
  Speaker 3: Iran War was like gasoline, Like it's literal, actually gasoline
• 30:10
  Speaker 3: for their economies. They know there's stock markets and all
• 30:13
  Speaker 3: that have recovered, but they're furious about what's happened here.
• 30:16
  Speaker 3: They can't really say a lot of it out loud.
• 30:18
  Speaker 3: If we do see some movement here with China, what
• 30:21
  Speaker 3: I am curious for your view, I think the autos
• 30:24
  Speaker 3: would be the thing that changed everything, because obviously everybody
• 30:27
  Speaker 3: knows the Chinese auto companies are just better than ours.
• 30:29
  Speaker 3: It's not really a question, it's not even really in dispute.
• 30:32
  Speaker 3: If we have some sort of licensing agreement of the
• 30:35
  Speaker 3: Big three and these autos, the two people it would
• 30:38
  Speaker 3: hurt the most are the South Korean and the Japanese,
• 30:40
  Speaker 3: who have done everything hand over fist, bent over backwards
• 30:45
  Speaker 3: to invest and to build here in the United States.
• 30:47
  Speaker 1: And even they they probably wouldn't be able to compete.
• 30:50
  Speaker 3: So how worried are they about not just about a deal,
• 30:54
  Speaker 3: but specifically autos, which accounts for a lot of the
• 30:57
  Speaker 3: trade that happens between the two. Or do you think
• 30:59
  Speaker 3: I'm off the mark on because I really think something's
• 31:01
  Speaker 3: going to happen.
• 31:02
  Speaker 5: I think something might happen. I'm not sure that it's
• 31:06
  Speaker 5: going to happen this time. Don't forget they're going to
• 31:09
  Speaker 5: be four times this year, right, or at least that's
• 31:10
  Speaker 5: that's that's the plan, and it really is. It really
• 31:14
  Speaker 5: is a complicated one. First off, look, I don't think
• 31:16
  Speaker 5: this trillion dollar. I don't I don't buy this trilli
• 31:19
  Speaker 5: I mean I was hearing that number a couple of
• 31:21
  Speaker 5: months ago, big Chinese. First of all, a trillion dollars
• 31:24
  Speaker 5: of investment requires a level of trust that simply does
• 31:27
  Speaker 5: not exist, right, I mean, you're building factories, You're talking
• 31:29
  Speaker 5: about the next ten twenty years, right.
• 31:31
  Speaker 3: But that wouldn't stop that we' announcing it, Yeah, from
• 31:33
  Speaker 3: a fake number. It doesn't have very real well exactly.
• 31:35
  Speaker 5: Look look, look, look, look, look you talk about the
• 31:37
  Speaker 5: Japanese and the South Koreans combined, they announced nine hundred
• 31:41
  Speaker 5: billion dollars right of investments in the US. EVS is
• 31:45
  Speaker 5: the interesting one. And you know a question Trump himself
• 31:50
  Speaker 5: has said, you know, fine, he said it didn't I
• 31:52
  Speaker 5: know Detroit, right, Yeah, let them let him in, let
• 31:54
  Speaker 5: them build. Jim Foley at Ford is much less sure
• 31:57
  Speaker 5: about this because, as you say, these cars and much better. Politically,
• 32:01
  Speaker 5: this is a huge problem because you're talking really now
• 32:04
  Speaker 5: about EV's and about connected vehicles. They're connected to the Internet,
• 32:08
  Speaker 5: and this is sort of Chinese CCP spies on wheels
• 32:11
  Speaker 5: and so on. The question is, you know, is there
• 32:14
  Speaker 5: a safe way to do this? The Canadians are working
• 32:17
  Speaker 5: on this, the Japanese themselves are working on the Koreans
• 32:20
  Speaker 5: who work out and don't forget the Chinese have American
• 32:24
  Speaker 5: EV's manufacturing by Elon Musk in China. It would be
• 32:32
  Speaker 5: an obvious one. But as you say, and at the
• 32:35
  Speaker 5: bottom end. See, they'd come in at the bottom end
• 32:37
  Speaker 5: of the market, right, so with kind of fifteen twenty
• 32:40
  Speaker 5: twenty five thousand dollar cars, which is the area that
• 32:42
  Speaker 5: they and they would compete in that space against Japanese
• 32:46
  Speaker 5: and the Koreans, not against Detroit. Detroit is now all
• 32:49
  Speaker 5: about big trucks and SUV's selling for sort of sixty
• 32:53
  Speaker 5: seventy eighty thousand bucks. Right, They're probably going to be okay.
• 32:56
  Speaker 5: Americans still love their cam bustion engines, although in time,
• 33:00
  Speaker 5: if you allow the Chinese in, they're going to be
• 33:02
  Speaker 5: going off to all of those markets. But I agree
• 33:05
  Speaker 5: with you, I think this is the big open question
• 33:07
  Speaker 5: is what do they do on EV.
• 33:09
  Speaker 3: Well, Andy, I really enjoyed talking to you. It's been
• 33:10
  Speaker 3: a great preview. Everybody go and read his columns. We'll
• 33:13
  Speaker 3: have links down in the description. Thank you for joining us, sir,
• 33:15
  Speaker 3: appreciate you it having me, appreciate it. Joining us now
• 33:21
  Speaker 3: is our great friend, Professor Robert Pape of the University
• 33:23
  Speaker 3: of Chicago.
• 33:24
  Speaker 1: It's great to see you, sir. Thanks for joining us,
• 33:26
  Speaker 1: Thanks for having me.
• 33:27
  Speaker 3: All Right, so, Professor, originally we're going to talk about Iran. However,
• 33:30
  Speaker 3: you sent along some slides that you've put together from
• 33:33
  Speaker 3: your most recent travels to China. We just spoke with
• 33:36
  Speaker 3: the journalist about what happened what's going to happen in
• 33:40
  Speaker 3: this summit, but you have a little bit more of
• 33:42
  Speaker 3: an interesting and more in depth view. So let's go
• 33:44
  Speaker 3: ahead and start with some of these and put these
• 33:46
  Speaker 3: slides up here on the screen, and you can tell
• 33:49
  Speaker 3: us a little bit.
• 33:50
  Speaker 6: About well, chll the most important thing that's going to
• 33:53
  Speaker 6: come out of this trip is the world is about
• 33:55
  Speaker 6: to rediscover China in ways they are going to be
• 33:59
  Speaker 6: blown away.
• 34:00
  Speaker 7: And I know.
• 34:01
  Speaker 6: Because I've been going to China since nineteen seventy nine.
• 34:04
  Speaker 6: I've been touring economic industries since nineteen seventy nine, and
• 34:08
  Speaker 6: when I went back in two thousand and June last year,
• 34:11
  Speaker 6: while we were bombing Fourdeaux. I was touring China's advanced
• 34:15
  Speaker 6: industries two weeks and China is just simply becoming an
• 34:20
  Speaker 6: AI juggernaut. This isn't about is one company or one
• 34:26
  Speaker 6: software ahead of America. That's a so to straw view
• 34:30
  Speaker 6: of what's happening in China. The big picture, which is
• 34:33
  Speaker 6: starting to blow away the journalists is that China.
• 34:37
  Speaker 7: We're beginning to confront.
• 34:38
  Speaker 6: The scale and the speed of China's already AI transformation
• 34:45
  Speaker 6: in the economy. I don't just simply mean on the
• 34:48
  Speaker 6: stock market. And so what China is doing is they
• 34:52
  Speaker 6: are massively integrating AI electrification, robotics, infrastru ructure in cities
• 35:02
  Speaker 6: and manufacturing to uplift whole regions, not just simply small
• 35:09
  Speaker 6: areas or small cities. They are producing massive products. This
• 35:14
  Speaker 6: is what the journalists are discovering as they drive through Beijing.
• 35:18
  Speaker 6: Cars brand new that are seas of cars, not seas
• 35:22
  Speaker 6: of bicycles. And these are electric vehicles you can't buy
• 35:27
  Speaker 6: in the United States. They're beyond Tesla. They're gonna see
• 35:30
  Speaker 6: they're gonna come back and they say, I want one
• 35:32
  Speaker 6: of those. And the reason is because during COVID, what
• 35:37
  Speaker 6: happened is we put all our money ten trillion dollars
• 35:42
  Speaker 6: plus in debt, and that was for good reason to
• 35:45
  Speaker 6: help our people. But what China did, and China can
• 35:49
  Speaker 6: do this as an authoritarian state, they invested. They didn't give,
• 35:53
  Speaker 6: they invested. And what I saw in China are not
• 35:59
  Speaker 6: just seas.
• 35:59
  Speaker 7: Of cars that went.
• 36:01
  Speaker 6: I visited these advanced cities now that have been uplifted
• 36:06
  Speaker 6: in the last five years. Major construction that's occurring. Here's
• 36:13
  Speaker 6: a good example. This is China's Pittsburgh, so to speak,
• 36:17
  Speaker 6: and in twenty fifteen when I was last there, it
• 36:20
  Speaker 6: looks like Pittsburgh.
• 36:22
  Speaker 7: Now.
• 36:23
  Speaker 6: This is like a version of at Wuhan calls it
• 36:26
  Speaker 6: their Optics Valley after Silicon Valley. These are advanced AI
• 36:31
  Speaker 6: driven laser robotics that are just uplifting the entire city
• 36:37
  Speaker 6: of ten million people. Because it's not just about building
• 36:41
  Speaker 6: a company. They're building they're integrating.
• 36:44
  Speaker 7: All this city wide.
• 36:45
  Speaker 6: So there's massive construction going on. This is another good example.
• 36:50
  Speaker 6: I was in Hangho in nineteen seventy nine. I was
• 36:52
  Speaker 6: part of the trip I was on and it was
• 36:55
  Speaker 6: a fishing village. Today, look at this, this is a
• 36:59
  Speaker 6: completely different hang Chow. There's still some fishing there by
• 37:03
  Speaker 6: the way, but what you see is this has been
• 37:06
  Speaker 6: uplifted as a city. Just imagine if that was Saint Louis,
• 37:11
  Speaker 6: imagine that this is sen Chen. Here's another example of
• 37:16
  Speaker 6: what was fishing, though it's just a couple hours outside
• 37:19
  Speaker 6: of Hong Kong on the Chinese side of the border. Also,
• 37:22
  Speaker 6: I was there in nineteen seventy nine. Now this is
• 37:25
  Speaker 6: an industry leader. This is where byd is. But notice
• 37:29
  Speaker 6: the city. It's not just electric manufacturing of the electric
• 37:33
  Speaker 6: vehicle manufacturing.
• 37:34
  Speaker 7: Look at the entire city of.
• 37:36
  Speaker 6: Ten million people, brand spanking new airports. This is what
• 37:42
  Speaker 6: we're missing China. It's not that China is catching up
• 37:47
  Speaker 6: to America. It's that we now need to catch up
• 37:51
  Speaker 6: to China. And it's not about inventing a single product.
• 37:55
  Speaker 6: You see, I think we think that, oh, as long
• 37:58
  Speaker 6: as we have the latest single widget, we are ahead.
• 38:02
  Speaker 6: What China's doing is inventing new widgets and then diffusing
• 38:06
  Speaker 6: them massively across whole sectors and regions.
• 38:10
  Speaker 7: They've uplifted about fifty to.
• 38:12
  Speaker 6: One hundred million people in the last six years. What
• 38:16
  Speaker 6: have we done for our rust belt? What have we
• 38:18
  Speaker 6: really done for Erie, Pennsylvania where I was born, Pittsburgh,
• 38:23
  Speaker 6: Saint Louis, Detroit, a Baltimore.
• 38:26
  Speaker 7: They look almost.
• 38:27
  Speaker 6: Exactly the same and in many ways worse than they
• 38:29
  Speaker 6: did six years ago.
• 38:31
  Speaker 7: What has China done?
• 38:32
  Speaker 6: They have invested up and we're missing the big picture.
• 38:37
  Speaker 2: That's such an important point and important insight. And I
• 38:40
  Speaker 2: wonder what you make of the fact President Trump was
• 38:42
  Speaker 2: bragging about all of these CEOs who made the trip
• 38:45
  Speaker 2: with him. You've got Tim Cook, You've got Jensen Wayg,
• 38:47
  Speaker 2: You've got Elon Musk and score. You know over twelve
• 38:51
  Speaker 2: individual CEOs of American companies who decided to go along
• 38:55
  Speaker 2: with him, who he brought along with him. What do
• 38:57
  Speaker 2: you make of that decision? And what do you think
• 38:59
  Speaker 2: that India about what he's going to move on?
• 39:01
  Speaker 7: What's everything?
• 39:02
  Speaker 6: This slide show you just showed and I have a
• 39:04
  Speaker 6: lot more puts everything in a new light. Those tech
• 39:07
  Speaker 6: bros are going because they're falling behind. They want to
• 39:11
  Speaker 6: catch up. Elon Musk is getting beat out by byd
• 39:15
  Speaker 6: He's going to try to find how can he get
• 39:18
  Speaker 6: in on the electric panels that are the election we
• 39:21
  Speaker 6: need for AI. We need massive electricity. What is China doing.
• 39:26
  Speaker 6: They are producing massive solar power, and yeah, that will
• 39:30
  Speaker 6: help the planet, but that's not I'm sorry, that's not
• 39:33
  Speaker 6: why they're doing it. They're not selling it to help
• 39:35
  Speaker 6: the planet. They're selling it to beat America and jettison
• 39:40
  Speaker 6: above America. And those tech bros are going because they're
• 39:44
  Speaker 6: falling behind. They don't want to admit it. They want
• 39:46
  Speaker 6: to pretend just like Trump victory talk, same thing's been
• 39:50
  Speaker 6: going on here. We are falling behind. And COVID was
• 39:54
  Speaker 6: the hinge. And hardly anybody has been to China since COVID.
• 39:58
  Speaker 6: I know because when I used to go to I
• 40:00
  Speaker 6: was surrounded by what Americans? I go last June, there's
• 40:04
  Speaker 6: no Americans. I mean there are a few, but you
• 40:07
  Speaker 6: could hardly find them. When was the last time a
• 40:09
  Speaker 6: politician went to China? Gavin Newsom went about eighteen months
• 40:14
  Speaker 6: ago for three days. Okay, he went to byd for
• 40:17
  Speaker 6: three days and there's still a video of it.
• 40:20
  Speaker 7: That's it. And I came back.
• 40:22
  Speaker 6: I tried to get a lot of politicians, I even,
• 40:25
  Speaker 6: I'm sorry to say, I tried to get journalists interested.
• 40:27
  Speaker 6: Nobody could find the time because it wasn't on the
• 40:31
  Speaker 6: radar well, Trump's trip here. This is what the journalists
• 40:35
  Speaker 6: are all talking about. The seas of evs, the green
• 40:40
  Speaker 6: license plates, brand spanking new beautiful porsches evs. This is
• 40:47
  Speaker 6: not like Turcell's. Okay, this is the leading edge. And
• 40:52
  Speaker 6: they have even more that I got to see, and
• 40:56
  Speaker 6: they won't put it. The robotic assembly lines. You can't
• 40:59
  Speaker 6: find them on. That's why I had to go. So
• 41:02
  Speaker 6: they are not bragging, talking smack like we do. What
• 41:06
  Speaker 6: they're doing is staying under the radar and just eating
• 41:09
  Speaker 6: our watch.
• 41:10
  Speaker 3: Right, you know, professor, to link this a little bit
• 41:12
  Speaker 3: to Iran, if we could put F four, for example,
• 41:15
  Speaker 3: up here on the screen.
• 41:16
  Speaker 1: This is from the New York Times.
• 41:18
  Speaker 3: New classified military intelligence assessments from earlier this month show
• 41:22
  Speaker 3: Iran has regained access to most of its missile sites, launchers,
• 41:25
  Speaker 3: underground facilities. US Intel assesses Iran has restored operational access
• 41:30
  Speaker 3: to thirty of the thirty three missile sites it maintains
• 41:33
  Speaker 3: along the Straits of Hormuves and that ninety percent of
• 41:35
  Speaker 3: their Iranian underground missile sites are partially or fully operational.
• 41:39
  Speaker 3: We just spoke with Andy Brown from Semaphore. He made
• 41:42
  Speaker 3: clear shi Shinping's number one priority one, two, and three
• 41:46
  Speaker 3: out of this trip is something on Taiwan, not necessarily
• 41:49
  Speaker 3: a total change in the status quo, but trying to
• 41:52
  Speaker 3: pierce the armor of the American view of Taiwan and
• 41:55
  Speaker 3: his own Taiwan problem. It seems to me an American
• 41:58
  Speaker 3: president has never met with a Chinese or even any
• 42:02
  Speaker 3: counterparty in an instance in the midst of such a
• 42:06
  Speaker 3: tremendous strategic defeat like what we have just suffered, and
• 42:10
  Speaker 3: how that's going to shift the trip. I mean, I'm
• 42:12
  Speaker 3: not exactly sure, not just because of what you're talking
• 42:14
  Speaker 3: about about their ascendants, but of our own weakness, of
• 42:18
  Speaker 3: a relative weakness in a moment like this at the
• 42:21
  Speaker 3: time of their meeting.
• 42:21
  Speaker 1: I'm just curious.
• 42:22
  Speaker 7: Let me just make two points here. Three.
• 42:25
  Speaker 6: So first, on your show a couple weeks ago, I said,
• 42:28
  Speaker 6: this is going to be scary for America because he's
• 42:30
  Speaker 6: about to go in this position of strategic defeat. She's
• 42:34
  Speaker 6: got all the cards. He's going to want concessions on Taiwan.
• 42:38
  Speaker 6: So this was number one, absolutely predictable. Number two if
• 42:44
  Speaker 6: you look at that Intel assessment. So what has happened
• 42:47
  Speaker 6: with America's basis. It's not that we didn't refurbish anything.
• 42:51
  Speaker 6: Those are bases basically thirty years old, twenty years old.
• 42:55
  Speaker 6: We're still living in the nineties a lot of the
• 42:57
  Speaker 6: way like we're living in the rest Belt in the nineties.
• 43:00
  Speaker 7: Point number three.
• 43:01
  Speaker 6: Imagine what's going to happen now with this emerging alliance.
• 43:04
  Speaker 6: Remember I'm talking about China emerging as the fourth center
• 43:09
  Speaker 6: of world power in concert with Russia and with China.
• 43:13
  Speaker 6: Start to imagine even a trickle of China's AI that
• 43:18
  Speaker 6: we're now seeing diffusing here in the electric vehicles and
• 43:23
  Speaker 6: robotic assemblies, any of that going to Iran, and Iran
• 43:28
  Speaker 6: can take advantage of it here. So this is the
• 43:31
  Speaker 6: future here that we're going to contend with. We're still
• 43:35
  Speaker 6: basically stuck in equipment, in basing structures that are twenty
• 43:40
  Speaker 6: years out of date. With COVID, there was a hinge
• 43:44
  Speaker 6: and China used COVID to jettison ahead in AI, not
• 43:50
  Speaker 6: inventing a single product, but in defusing this and integrating
• 43:54
  Speaker 6: this across whole sectors. This could be Iran in the
• 43:59
  Speaker 6: coming years.
• 44:00
  Speaker 2: Yeah, well, that is very fascinating to think about. And
• 44:03
  Speaker 2: Trump tried to downplay the Iran aspect of what would
• 44:07
  Speaker 2: be discussed with China saying, Oh, I don't think that's
• 44:09
  Speaker 2: going to be a big.
• 44:10
  Speaker 4: Part of it.
• 44:11
  Speaker 2: What do you make of China's view on our attack
• 44:15
  Speaker 2: on Iran? On the Iran War? Trump loves to point
• 44:18
  Speaker 2: out that they get a lot more of their oil
• 44:20
  Speaker 2: through the straight ofform moves, which is true than we do,
• 44:23
  Speaker 2: so they certainly are impacted by it. Of course, China
• 44:25
  Speaker 2: is a nation that does a lot of trade with
• 44:27
  Speaker 2: the world, so anytime that trade flows are impacted, that's
• 44:30
  Speaker 2: going to be something that they pay close attention to.
• 44:33
  Speaker 2: So what do you think will be said and discussed
• 44:35
  Speaker 2: with regard to the run war on this train?
• 44:37
  Speaker 6: Yeah, so a couple points. First, notice that Trump is
• 44:39
  Speaker 6: the master of sleight of hand, like a magician. That
• 44:42
  Speaker 6: stat that you just said is not false, but it's
• 44:45
  Speaker 6: out of the larger context he doesn't want you to
• 44:48
  Speaker 6: focus on like a magician. The bigger context is China
• 44:52
  Speaker 6: has been weaning itself off of oil over the last decade.
• 44:57
  Speaker 6: Only twenty percent of its energy needs now twenty percent
• 45:01
  Speaker 6: are met with oil, and only thirty eight percent of
• 45:03
  Speaker 6: that come from the Persian Gulf. So last summer when
• 45:06
  Speaker 6: I was visiting those electric those advanced industries, the business
• 45:11
  Speaker 6: people were telling me and the dinners that, yeah, they
• 45:14
  Speaker 6: may suffer a percent or two here or their loss
• 45:17
  Speaker 6: of GDP, but the fact of the matter is their
• 45:20
  Speaker 6: whole business plan is built around Asia. It's built around
• 45:24
  Speaker 6: this will create opportunities for them to buy things and
• 45:28
  Speaker 6: get deals on the cheap. They're more likely to jettison
• 45:31
  Speaker 6: ahead as a result of this will America gets sunk here.
• 45:36
  Speaker 6: And what you were seeing is we just keep getting
• 45:39
  Speaker 6: spun by Trump's rhetoric here and we're missing big pictures.
• 45:44
  Speaker 6: Some of it's because we just don't go to China.
• 45:47
  Speaker 6: We try to get everything from behind our computers. And
• 45:50
  Speaker 6: I know it's ironic that here, I am a professor,
• 45:53
  Speaker 6: spend most of my life behind a computer. And I'm
• 45:55
  Speaker 6: telling journalists and I'm telling politicians, you've got to get
• 45:58
  Speaker 6: out and meet people and see the real world. That's
• 46:02
  Speaker 6: what's happening. Otherwise we're just stuck listening to President Trump's
• 46:06
  Speaker 6: vision of the real world.
• 46:07
  Speaker 7: Right.
• 46:07
  Speaker 3: I think it's very important, And I do think that
• 46:09
  Speaker 3: this is like a collision of moments with the Iran
• 46:12
  Speaker 3: war and this summit, because I do expect some sort
• 46:15
  Speaker 3: of accommodation is something in terms of trade Taiwan. I
• 46:18
  Speaker 3: don't know exactly what it's going to look like, and
• 46:20
  Speaker 3: it may not be immediately obvious. But in the long run, professor,
• 46:24
  Speaker 3: how do you see this playing out?
• 46:25
  Speaker 1: Like the Taiwan question.
• 46:27
  Speaker 3: From China's perspective, it doesn't seem to me that they
• 46:30
  Speaker 3: would want to do a full on military invasion.
• 46:33
  Speaker 1: They're more recently.
• 46:34
  Speaker 6: They would be foolish to do a full on military invasion,
• 46:38
  Speaker 6: even if they could succeed, because what that would do
• 46:41
  Speaker 6: is it would take the focus off of blame of
• 46:44
  Speaker 6: the United States, it would push Europe away, push some
• 46:47
  Speaker 6: of the other Asian partners away they want so they
• 46:50
  Speaker 6: could help us out. I say this only half jokingly here,
• 46:55
  Speaker 6: to my classes, the best way to bail out Trump
• 46:58
  Speaker 6: from the Iran war would be if she would attack Taiwan,
• 47:02
  Speaker 6: because this would fundamentally help Trump. And maybe he's going
• 47:06
  Speaker 6: to try to tickle to she and say, don't you
• 47:07
  Speaker 6: want to do this? Well, I'm sorry, I don't want
• 47:10
  Speaker 6: to be too facetious. But the fact of the matter
• 47:12
  Speaker 6: is what China has done now since the nineteen ninety
• 47:17
  Speaker 6: six Taiwan straight crisis.
• 47:19
  Speaker 7: Think about that.
• 47:20
  Speaker 6: Thirty years ago they did some missile a gunboat diplomacy.
• 47:24
  Speaker 6: It totally backfired and failed. They haven't done that since. Now,
• 47:28
  Speaker 6: they've done some incursions. I know, I've been to Taiwan.
• 47:31
  Speaker 6: I've been. I've had the briefings from the National Security
• 47:34
  Speaker 6: Advisor here, so I've got some action.
• 47:36
  Speaker 7: I've go to Taiwan too.
• 47:38
  Speaker 6: And what you are, what you're really seeing is China
• 47:42
  Speaker 6: here is just getting stronger and stronger and stronger incrementally.
• 47:46
  Speaker 6: That's true economically, that's true militarily, and at some point
• 47:50
  Speaker 6: Taiwan may just fall in their lap. They they may
• 47:53
  Speaker 6: not have to actually use military force. And look at
• 47:56
  Speaker 6: we've run out of all these boutique missiles. Are so
• 48:00
  Speaker 6: many of them. We're really hurting now. In terms of
• 48:04
  Speaker 6: supporting Taiwan, what's keeping Taiwan afloat is its actual Taiwanese
• 48:09
  Speaker 6: military power, which is not trivial here. They have months
• 48:14
  Speaker 6: they could hold out against China on its own. But
• 48:17
  Speaker 6: whether America is the cavalry that would come to the
• 48:20
  Speaker 6: rescue after say, four or five months of a blockade
• 48:23
  Speaker 6: against Taiwan, that's an open question at this point.
• 48:26
  Speaker 7: And she sees it.
• 48:28
  Speaker 2: Yeah, And finally, we can't have you here without asking
• 48:31
  Speaker 2: you a little bit directly about the Ron Warrior. What's
• 48:34
  Speaker 2: your sense of where we are and are things just
• 48:37
  Speaker 2: sort of on pause right now while Trump makes this trip,
• 48:40
  Speaker 2: and do you feel that the pressure is continuing to
• 48:43
  Speaker 2: build on him to take some sort of action.
• 48:45
  Speaker 6: Yeah, this is a lull before a likely storm. We
• 48:48
  Speaker 6: just don't know whether that storm is going to be
• 48:52
  Speaker 6: sort of a cloud burster, it's going to be a hailstorm.
• 48:55
  Speaker 6: And the issue here we've talked about many many times
• 48:58
  Speaker 6: is President Trump is going to have an incredibly difficult
• 49:02
  Speaker 6: time swallowing that big l on him, which will as
• 49:07
  Speaker 6: bad as you think his political prospects are now, he's
• 49:10
  Speaker 6: still got a large part of MAGA behind him and
• 49:14
  Speaker 6: they will be even more behind him as they get
• 49:16
  Speaker 6: into the midterms. However, if he accepts the loss and
• 49:20
  Speaker 6: really just says, Yep, you're right, I've got to stand
• 49:23
  Speaker 6: aside while Iran gets a nuclear weapon, think about that,
• 49:27
  Speaker 6: because that's what the real future is here, then a
• 49:30
  Speaker 6: lot of even MAGA is going to lose confidence in
• 49:33
  Speaker 6: the great leader because that great leader isn't so great anymore.
• 49:36
  Speaker 6: So this is where the real problem of the trap is.
• 49:41
  Speaker 6: As bad as it might seem to go down a
• 49:43
  Speaker 6: road of escalation, going down the other road for Trump
• 49:47
  Speaker 6: is worse. Now, the rest of us may be perfectly
• 49:49
  Speaker 6: happy to let you make the choice.
• 49:52
  Speaker 7: We don't want casualties.
• 49:53
  Speaker 6: We'd rather go down and allow Aaran to emerge as
• 49:57
  Speaker 6: the fourth center of world power. That's the choice, and
• 50:00
  Speaker 6: we may make a different choice. But the guy in
• 50:03
  Speaker 6: the Oval office is President Trump, and he's in there
• 50:06
  Speaker 6: for two and a half more years.
• 50:09
  Speaker 3: Well, you always leave us with a lot to think about, Professor,
• 50:12
  Speaker 3: You certainly do is an escalation trap on substack, go
• 50:15
  Speaker 3: subscribe linked down and description.
• 50:17
  Speaker 1: Thank you very much, sir. We appreciate your time.
• 50:19
  Speaker 6: Oh, thank you. You're always ahead. You guys are always ahead,
• 50:21
  Speaker 6: and help keep my substack ahead.
• 50:23
  Speaker 1: Good.
• 50:24
  Speaker 3: Let's keep it up number one. God to make it
• 50:26
  Speaker 3: number one. Thank you guys so much for watching. We
• 50:29
  Speaker 3: appreciate it. We will have a great break another breaking
• 50:31
  Speaker 3: point show tomorrows show. All right, so things got switched up,
• 50:35
  Speaker 3: but nobody got shorted. All right, We'll see you all then.