Latest / Trumponomics / Voternomics: Why the US Election Isn’t About Foreign Policy with Niall Ferguson

Transcript

Voternomics: Why the US Election Isn’t About Foreign Policy with Niall Ferguson · Trumponomics

• 0:03
  Speaker 1: Bloomberg Audio Studios, Podcasts, radio news.
• 0:15
  Speaker 2: The question was put to me in late twenty sixteen
• 0:19
  Speaker 2: after the election, and I went to Trump Tar and
• 0:23
  Speaker 2: I met a number of the key protagonists in a
• 0:27
  Speaker 2: very surreal afternoon. And after I had met Anthony Scaramucci
• 0:33
  Speaker 2: and Mike Flynn and Steve Bannon and Michael Cohen, I
• 0:37
  Speaker 2: phoned my wife up and I said, this will end
• 0:40
  Speaker 2: in a welter of litigation. We're going to have nothing
• 0:43
  Speaker 2: to do with it. Good call.
• 0:47
  Speaker 3: Welcome to the first episode of voter Nomics, where politics
• 0:51
  Speaker 3: and markets collide. This year, voters around the world have
• 0:55
  Speaker 3: the ability to affect markets, countries, and economies like never before,
• 1:00
  Speaker 3: so we've cooked up this series to help you make
• 1:02
  Speaker 3: sense of it all. I'm Stephanie Flanders. I lead our
• 1:06
  Speaker 3: government and economics coverage at Bloomberg, also our economic research,
• 1:10
  Speaker 3: and back in the day, I was once BBC Economics editor.
• 1:13
  Speaker 1: I'm alegra Stratton, I author Bloomberg's read Out newsletter. And
• 1:17
  Speaker 1: I used to work in Number ten, but also number eleven,
• 1:21
  Speaker 1: number nine, and then also actually sorry number twelve downing steeks.
• 1:26
  Speaker 3: Anyway, we'll maybe get into that later.
• 1:31
  Speaker 4: And I made rim Woodbridge I've never worked in Downing Street,
• 1:33
  Speaker 4: but I'm an opinion columnist and I'm an author, and
• 1:36
  Speaker 4: for thirty two years I worked for The Economist. I
• 1:39
  Speaker 4: wrote the Lexington column, the Schumpeter column, and the Badget column,
• 1:43
  Speaker 4: and I can sense them not all at once successively.
• 1:46
  Speaker 3: This is already chaos. It's going to be so much fun. Okay,
• 1:49
  Speaker 3: So you just heard from the historian and pundit Neil Ferguson.
• 1:53
  Speaker 3: Later in the episode, we're going to chat with him
• 1:56
  Speaker 3: about the state of the world, the state of the US,
• 1:58
  Speaker 3: and what he thinks about it all. You won't want
• 2:00
  Speaker 3: to miss it, you, Allegra, particularly since you weren't part
• 2:03
  Speaker 3: of the interview, and I'm sorry. Also on the show
• 2:06
  Speaker 3: this week, we have Bloomberg senior reporter in Washington, Nancy Cook,
• 2:10
  Speaker 3: who tells us everything that's going on in US politics,
• 2:13
  Speaker 3: and also a little bit about the upcoming White House
• 2:16
  Speaker 3: Correspondence dinner. That that invitation that at least some people
• 2:20
  Speaker 3: would like. Maybe've established that Adrian wouldn't like that. But
• 2:24
  Speaker 3: before we get into it, I guess we should just
• 2:27
  Speaker 3: explain to people why on earth we're doing this. Adrian.
• 2:31
  Speaker 3: I mean, at first, I guess we should say that
• 2:33
  Speaker 3: you know this Bloomberg News Agency. We haven't just stumbled
• 2:36
  Speaker 3: on the fact that there were a lot of neglections
• 2:38
  Speaker 3: this year or that they were going to affect economies.
• 2:41
  Speaker 3: But the more we listened to what everyone else was
• 2:44
  Speaker 3: saying about them, the more we felt like there was
• 2:45
  Speaker 3: a bit of a gap we could fill. What do
• 2:47
  Speaker 3: you mean everyone else? All the other podcasts, There are
• 2:50
  Speaker 3: other posts by men. I'm told there are other podcasts,
• 2:52
  Speaker 3: many of them hosted by men.
• 2:55
  Speaker 1: Bloomberg has a unique take on these elections because of
• 2:58
  Speaker 1: the welter of economic analysis. I when we're sitting in
• 3:01
  Speaker 1: the podcast recording studio and if I look out at
• 3:04
  Speaker 1: of the glass windows, I can see screen upon screen
• 3:07
  Speaker 1: of data and economic analysis going on. So we're absolutely
• 3:10
  Speaker 1: in the belly of the beast in the city of
• 3:12
  Speaker 1: London looking at the economics and how they might impact
• 3:16
  Speaker 1: on how people will vote.
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  Speaker 4: And the other thing I think is that we're truly
• 3:19
  Speaker 4: a global news service and these are global elections. I
• 3:23
  Speaker 4: mean there are elections, really big elections in Written in
• 3:26
  Speaker 4: the United States, in South Africa, every corner of the world.
• 3:29
  Speaker 4: They're taking place. So we want to bring a global
• 3:31
  Speaker 4: perspective as well as an economic and business perspective to it.
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  Speaker 3: And it speaks to one of the reasons that you're here, Adrian,
• 3:36
  Speaker 3: is that that sort of politics and geopolitics has been
• 3:40
  Speaker 3: forcing its way onto the agenda for businessmen and people
• 3:44
  Speaker 3: and politicians and policy makers all around the world in
• 3:49
  Speaker 3: a way. I mean, I certainly noticed doing Stephanomics, a
• 3:52
  Speaker 3: sort of previous partial version of this that that just
• 3:55
  Speaker 3: kept we kept on having to talk about geopolitics and
• 3:58
  Speaker 3: history in a way that I don't think would have
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  Speaker 3: been true if we were doing a sort of narrow
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  Speaker 3: show on the global economy a few years ago.
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  Speaker 4: Absolutely, if you look at companies, there's always been some
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  Speaker 4: sorts of companies that have had to take geopolitics into consideration.
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  Speaker 4: If you're an energy company, you have to do that,
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  Speaker 4: and you put xpis and you put ex ambassadors on
• 4:16
  Speaker 4: your board and all sorts of things. Now it's an
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  Speaker 4: extraordinary range of companies, pharmaceutical companies, it companies, even if
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  Speaker 4: you're in the food business. You're being impinged upon by
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  Speaker 4: JEOE strategic tensions, threats by politicians in the way that
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  Speaker 4: we've never seen before. In every single way, you can't
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  Speaker 4: understand politics without understanding economics and business and vice versa.
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  Speaker 1: And the phrase that I keep coming back to, which
• 4:39
  Speaker 1: I hope that this podcast will sort of interrogate over time,
• 4:43
  Speaker 1: is it's the economy stupid, because I don't know if
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  Speaker 1: it is anymore, and I want this podcast to help
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  Speaker 1: me because sometimes I think, yeah, you know, you can
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  Speaker 1: see the economics driving people to vote in certain ways.
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  Speaker 1: And then in America, which we're going to talk about
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  Speaker 1: in depth in a second, it's more complicated, isn't it.
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  Speaker 3: No, in a very I remember, even just a few
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  Speaker 3: years ago, sort of wise economic policy maker saying to me,
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  Speaker 3: I think it was just sort of in the wake
• 5:07
  Speaker 3: of the Eurozone economic crisis, but saying, you know, we
• 5:11
  Speaker 3: often say, we economists often say old politicians they don't
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  Speaker 3: understand the laws of economics, they don't understand basic arithmetic,
• 5:19
  Speaker 3: and that's why they get into these troubles. And then
• 5:21
  Speaker 3: he paused and he said, though, I have to say,
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  Speaker 3: I think quite a lot of us don't understand the
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  Speaker 3: laws of politics, and we tend to ignore that too much.
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  Speaker 3: And that's I've had that running through my head quite
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  Speaker 3: a lot the last two is. So that's what we're about.
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  Speaker 3: I think we're going to go off. You can already
• 5:36
  Speaker 3: tell we're going to go off in a number of
• 5:38
  Speaker 3: different directions. Who knows, especially when we have the three
• 5:41
  Speaker 3: of us sitting in this room. But I think there'll
• 5:44
  Speaker 3: be some sort of common threads for each episode, one
• 5:49
  Speaker 3: of which is we will have a conversation with someone
• 5:51
  Speaker 3: we think is interesting, maybe someone you've heard before, but
• 5:54
  Speaker 3: we'll be asking them much better questions. It may also
• 5:56
  Speaker 3: be someone that you had not realized you ought to
• 5:59
  Speaker 3: know about. And so more of that in the coming weeks.
• 6:03
  Speaker 3: And we'll be checking in with one of our colleagues
• 6:06
  Speaker 3: from around the world on a pretty regular basis to
• 6:09
  Speaker 3: get a sense of what they're seeing on the ground
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  Speaker 3: and how it feeds into this sort of big picture,
• 6:14
  Speaker 3: grand thoughts that we are hopefully having occasionally or hearing
• 6:17
  Speaker 3: from other people. And in that vein, I wanted to
• 6:21
  Speaker 3: introduce you to Nancy Cook, one of our senior reporters
• 6:26
  Speaker 3: in d C. Writes a lot about economic policy, but
• 6:29
  Speaker 3: we've also had her out on the campaign trail quite
• 6:32
  Speaker 3: a lot in the last few months because obviously, you know,
• 6:35
  Speaker 3: things are hotting up in the US presidential race. See
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  Speaker 3: thank you, Thank you so much. For doing this. You know,
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  Speaker 3: we tend to look at the US election partly for
• 6:45
  Speaker 3: the sort of horse race aspect of who's going to win,
• 6:48
  Speaker 3: but also thinking about how important it is for the
• 6:51
  Speaker 3: rest of the world. How are you seeing the rest
• 6:55
  Speaker 3: of the world figure in what you're writing about day
• 6:57
  Speaker 3: to day on the campaign trail.
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  Speaker 5: I think that's act will be hugely important for the
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  Speaker 5: rest of the world, and it will just present dramatically
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  Speaker 5: different outcomes based on who's elected. And we're already seen that.
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  Speaker 5: We're seeing a bunch of foreign leaders already make pilgrimages
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  Speaker 5: tomorrow Lago or Trump Tower to meet with the former president.
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  Speaker 5: You know, even world leaders are really trying to get
• 7:19
  Speaker 5: their hands around what this election will look like, because
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  Speaker 5: based on who wins, it will have very different outcomes
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  Speaker 5: for trade, for foreign policy, just for general US alliances,
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  Speaker 5: for the future of NATO, for what will happen in Ukraine.
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  Speaker 5: And so I think that people are wise to really
• 7:36
  Speaker 5: sort of pay attention to this.
• 7:38
  Speaker 1: Can you take us inside the mind of the average
• 7:40
  Speaker 1: American voter. They are for us, certainly for me, this
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  Speaker 1: curious thing where they are living in a booming economy,
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  Speaker 1: but they are not happy.
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  Speaker 5: So I think that the average American voter at this
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  Speaker 5: point is pretty disengaged from this election. You know, the
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  Speaker 5: majority of Americans are not really happy with their choices.
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  Speaker 5: They're not enthusiastic about Biden, They're not enthusiastic about Trump.
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  Speaker 5: They think they're both too old, you know, too problematic.
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  Speaker 2: Are they right?
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  Speaker 5: I mean, I think that they're right to some extent,
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  Speaker 5: and that you know, these are, you know, two of
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  Speaker 5: the oldest candidates we've ever seen, and I think a
• 8:18
  Speaker 5: lot of Americans feel like we've we know them well,
• 8:20
  Speaker 5: we know their flaws, well, we know what they're good at, well,
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  Speaker 5: we know what they're you know, and so I think
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  Speaker 5: people really would have been more excited to see sort
• 8:28
  Speaker 5: of fresh, new candidates, but that's not how it ended
• 8:31
  Speaker 5: up working in the US primary system, and so the
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  Speaker 5: average American voter is wildly disengaged. I'm not expecting them
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  Speaker 5: to become you know, start paying attention really until the fall,
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  Speaker 5: most likely. And I think that, you know, they're very
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  Speaker 5: worried about things as I was talking about, like the economy.
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  Speaker 5: I think women and young people are very worried about
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  Speaker 5: reproductive rights in the US because you know, the state
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  Speaker 5: by state there's so many states that are sort of
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  Speaker 5: banning abortion or doing a lot of restrictions on reproductive rights,
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  Speaker 5: and I think the average American voter has just kind
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  Speaker 5: of tuned out at this point, which is wild, because
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  Speaker 5: you know, I think this election A will be very
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  Speaker 5: close and B will be decided by a very small
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  Speaker 5: number of people in seven swing states, and so it's
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  Speaker 5: just a wild thing to feel like there's a US
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  Speaker 5: election that no one in the US is actually excited
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  Speaker 5: about and there will be like maybe sixty thousand people
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  Speaker 5: that ultimately decide it.
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  Speaker 3: Nancy, we've got a good taster of what we are
• 9:25
  Speaker 3: going to have from you over the course of many episodes.
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  Speaker 3: We will be coming back to you. I hope you're
• 9:30
  Speaker 3: not going to sound just more and more tired as
• 9:32
  Speaker 3: the campaign goes on. But before I go, I mean,
• 9:35
  Speaker 3: we're going to try and be very lofty and global
• 9:37
  Speaker 3: and also think about the kind of broader you know,
• 9:39
  Speaker 3: at the real America. But there's a very unreal Washington
• 9:43
  Speaker 3: event happening this weekend, which I did go to last year,
• 9:47
  Speaker 3: and then I just couldn't go this year because my
• 9:49
  Speaker 3: liver needed at least a year more than a year's
• 9:51
  Speaker 3: rest and that. But I did want to go once
• 9:54
  Speaker 3: so that I could relive the broadcast news the movie.
• 9:57
  Speaker 3: But the Washington Correspondent's Dinner is this week? Can Nancy
• 10:00
  Speaker 3: are you looking forward to it? Is the whole of
• 10:03
  Speaker 3: the Washington wishing they had an invitation? Or is it
• 10:06
  Speaker 3: more everything around it that people are now going to.
• 10:09
  Speaker 5: Well, people who have lived in Washington for a long time,
• 10:11
  Speaker 5: like myself, always roll their eyes at it, but then
• 10:14
  Speaker 5: they are SVP to all the parties and go to everything,
• 10:18
  Speaker 5: you know, willingly.
• 10:20
  Speaker 2: You know it is.
• 10:21
  Speaker 5: It'll be interesting this year because President Biden is speaking.
• 10:24
  Speaker 5: He went last year and it's always interesting to see
• 10:26
  Speaker 5: sort of how he interacts with the public and the media,
• 10:29
  Speaker 5: particularly during a campaign year. And you know, basically it's
• 10:32
  Speaker 5: a lot of Washington networking. The parties have now expanded
• 10:36
  Speaker 5: to basically Thursday through Sunday, So.
• 10:38
  Speaker 4: Who can that be? One night is enough? I mean
• 10:42
  Speaker 4: it's horrible, That's why how can it go on for
• 10:44
  Speaker 4: four days?
• 10:44
  Speaker 1: That's why the economy's growing?
• 10:46
  Speaker 5: So you know, it's a chance to kind of catch
• 10:49
  Speaker 5: up with a lot of people in Washington in a
• 10:51
  Speaker 5: very short period of time, efficiently by going to many
• 10:53
  Speaker 5: many cocktail parties.
• 10:55
  Speaker 3: What is the best party in town. That's the hardest
• 10:57
  Speaker 3: thing to get an invitation too.
• 10:59
  Speaker 5: I think that there and there's several parties at embassy's
• 11:02
  Speaker 5: that the ambassadors throw, and I think that those are
• 11:04
  Speaker 5: always the hot parties.
• 11:06
  Speaker 3: The Parrot, the French Embassy, yeah.
• 11:08
  Speaker 5: There, you know, there's the Swiss Embassy. The British ambassador,
• 11:12
  Speaker 5: you know, is very social and likes to throw parties.
• 11:14
  Speaker 5: So there's a bunch of different ambassador parties over the
• 11:16
  Speaker 5: next four days, and I feel like those are kind
• 11:19
  Speaker 5: of the or Thursday through Sunday, and those are the
• 11:21
  Speaker 5: hot tickets because going to an embassy.
• 11:25
  Speaker 3: I have that saying.
• 11:25
  Speaker 4: The best one used to be, although I have very
• 11:27
  Speaker 4: very vague memories of it, was the Christopher Hitchin's party,
• 11:31
  Speaker 4: which was absolutely fantastic.
• 11:33
  Speaker 3: You probably had fake memories of it the next day.
• 11:35
  Speaker 3: Absolutely all right, Nancy, we'll let you go, but thank
• 11:39
  Speaker 3: you and we'll listen to you again.
• 11:40
  Speaker 5: Thanks so much for having me.
• 11:46
  Speaker 3: Before chaos breaks out again. Let's get to our guest
• 11:49
  Speaker 3: this week, Neil Ferguson, Bloomberg opinion columnist. He's a Millbank
• 11:53
  Speaker 3: Family senior fellow at the Hoover Institution at Stanford University
• 11:57
  Speaker 3: and the author of gazillion books, but most recent Doom
• 12:01
  Speaker 3: The Politics of Catastrophe. As we were saying earlier, the
• 12:04
  Speaker 3: whole idea of voter nomics is to take stock of
• 12:08
  Speaker 3: the way that geopolitics is overturning a lot of long
• 12:11
  Speaker 3: standing assumptions about economics and indeed business around the world.
• 12:16
  Speaker 3: So Neil seemed like an excellent person to start with
• 12:19
  Speaker 3: to get a very intelligent mashup of economics, geopolitics and history.
• 12:25
  Speaker 3: So let's get to that conversation. When we look at
• 12:29
  Speaker 3: the US election from the UK, although we talk a
• 12:34
  Speaker 3: lot about the economy and why isn't Biden doing better
• 12:39
  Speaker 3: from the surprisingly strong economy, it does feel like international
• 12:44
  Speaker 3: events are looming larger than they usually do in a
• 12:46
  Speaker 3: US general election. So I'm just wondering, from your perspective,
• 12:49
  Speaker 3: does this feel like a foreign policy election?
• 12:52
  Speaker 2: I doubt it. I think if you look at the
• 12:55
  Speaker 2: key voters in the swing states and that those are
• 12:59
  Speaker 2: the not very committed independence and the people who flip
• 13:05
  Speaker 2: between elections, I doubt that they're sitting with maps of
• 13:10
  Speaker 2: the Middle East pondering whether Prime Minister Netanya, who should
• 13:15
  Speaker 2: make a move against Hezbollah. They are probably more interested
• 13:18
  Speaker 2: in Trump's New York criminal trial, because when you look
• 13:23
  Speaker 2: at the polling, that's very interesting. If you ask people
• 13:28
  Speaker 2: how would you vote tomorrow? Trump wins in the swing states,
• 13:32
  Speaker 2: But if you ask them if you had a criminal conviction,
• 13:35
  Speaker 2: how would you vote tomorrow? It flips and so much
• 13:39
  Speaker 2: more hinges on the law fare than the actual warfare
• 13:43
  Speaker 2: in this election.
• 13:44
  Speaker 4: As far as all, let me push back on that mail,
• 13:47
  Speaker 4: because what's handy at Columbia University at the moment seems
• 13:51
  Speaker 4: to be extremely polarizing and motivating and voters. And when
• 13:56
  Speaker 4: I was in New York last week and the Columbia
• 13:59
  Speaker 4: University stuff massively occupied people's minds as compared with the
• 14:05
  Speaker 4: Trump trial, which basically was boring to people. Isn't this
• 14:09
  Speaker 4: sort of protest something that annoys swing voters? When't we
• 14:13
  Speaker 4: see more of it in Chicago at the Democratic Convention?
• 14:16
  Speaker 4: That perhaps? And would it shift quite a lot of people?
• 14:19
  Speaker 2: As last I heard New York as one of the
• 14:21
  Speaker 2: swing states. I have to say that the Trump campaign
• 14:26
  Speaker 2: is basically the twenty sixteen campaign, and it's about economic issues,
• 14:31
  Speaker 2: it's about immigration, It's really about the same themes of
• 14:37
  Speaker 2: that twenty sixteen election eight years ago still works for
• 14:41
  Speaker 2: the base. They're still motivated, especially on the idea that
• 14:44
  Speaker 2: there's an open border criminal gangs are pouring through. That's
• 14:50
  Speaker 2: the Trump campaign. The Trump campaign isn't really about woke
• 14:54
  Speaker 2: Columbia student that exercises the chattering classes enormously. But between
• 15:01
  Speaker 2: New York and California, where I also spend time, I'm
• 15:03
  Speaker 2: struck by how much conversation on those subjects is irrelevant
• 15:08
  Speaker 2: to this election because those states are not in play.
• 15:10
  Speaker 2: You gotta ask yourself the question, Adrian, which counties in
• 15:14
  Speaker 2: which states are in play? And what do people there
• 15:17
  Speaker 2: care about? And I honestly doubt that they care about
• 15:20
  Speaker 2: campus politics. I'm exposed to it at very close quarters
• 15:24
  Speaker 2: because I have to tell you, Stanford hasn't been a
• 15:26
  Speaker 2: whole lot better than Columbia, and I just don't think
• 15:29
  Speaker 2: it's going to be decisive in this election.
• 15:31
  Speaker 4: I still feel that it matters, and the person who
• 15:34
  Speaker 4: comes to my mind is Richard Nixon. And the way
• 15:37
  Speaker 4: that you got this backlash against student protests student radicalism
• 15:42
  Speaker 4: really feeding into Middle Americans feeling as though this wasn't
• 15:46
  Speaker 4: the sort of thing they could go with.
• 15:48
  Speaker 2: There's one thing I'll agree with you about. If they
• 15:50
  Speaker 2: have another Chicago convention of the sort that undoubtedly damaged
• 15:56
  Speaker 2: the Democratic cause in the Nixon era, then yeah, because
• 16:00
  Speaker 2: that will put it in squarely in the national political debate.
• 16:06
  Speaker 2: So if in August it's a complete fiasco in Chicago
• 16:09
  Speaker 2: and there are pro Palestinian protests disrupting the convention, then
• 16:12
  Speaker 2: I think that will undoubtedly help Trump, But I'm skeptical
• 16:16
  Speaker 2: that it's the key issue at the moment. Look, if
• 16:19
  Speaker 2: it were, Trump would be pulling ahead. But as far
• 16:22
  Speaker 2: as I can see, Biden's closed the gap in the
• 16:24
  Speaker 2: last couple of months for two reasons. One that people
• 16:28
  Speaker 2: are beginning to come round to the view that the
• 16:30
  Speaker 2: economy is actually quite good, and that's taken a while
• 16:35
  Speaker 2: because there was so much disillusion with the inflation spike
• 16:39
  Speaker 2: in twenty twenty two. The other thing that's interesting is
• 16:43
  Speaker 2: that for most Americans we began by discussing, I don't
• 16:47
  Speaker 2: think foreign policy is at all a top priority in
• 16:51
  Speaker 2: this election. It's not ranked highly in the issues. But
• 16:55
  Speaker 2: in the last couple of months, Republicans have been entirely
• 17:00
  Speaker 2: divided on the Ukraine question. One part of their party,
• 17:04
  Speaker 2: especially in the House of Representatives, is isolationists and wants Ukraine
• 17:09
  Speaker 2: essentially to be thrown under the nearest available Russian bus.
• 17:12
  Speaker 2: And then there are a whole bunch of other people
• 17:14
  Speaker 2: like Mike Pompeo and Mike Gallagher and Matt Possenger who
• 17:20
  Speaker 2: are more hawkish than the Democrats on every major conflict issue,
• 17:25
  Speaker 2: and I think that's actually somewhat damaging to the Republican cause.
• 17:30
  Speaker 2: We haven't mentioned it, but abortion is the one issue
• 17:33
  Speaker 2: where the Democrats have an edge over the Republicans, that
• 17:37
  Speaker 2: reproductive writs, whatever you want to call it. Frankly, I'll
• 17:41
  Speaker 2: be surprised if the antics of work college students really
• 17:46
  Speaker 2: show up in the polling. We'll know in a guess
• 17:49
  Speaker 2: in a few weeks if you're right and I'm wrong.
• 17:52
  Speaker 3: Just to finish this off, the obvious place where people
• 17:54
  Speaker 3: do point to a cost to Biden of the dynamics
• 18:00
  Speaker 3: the Middle East and that strong feelings on that is
• 18:02
  Speaker 3: somewhere like Michigan. Do we overstate the impact that some
• 18:06
  Speaker 3: of those sort of the marginal voter who may just
• 18:09
  Speaker 3: not turn out for the Democrats, actually they're out campaigning
• 18:13
  Speaker 3: and they don't feel like he's on the right side
• 18:14
  Speaker 3: of history.
• 18:15
  Speaker 2: I think Michigan's very important in the sense that you
• 18:19
  Speaker 2: have a substantial Muslim vote, which was not something Richard
• 18:23
  Speaker 2: Nixon had to worry about. And you also have the
• 18:29
  Speaker 2: kind of fellow traveler sympathizers with the Palestinian cause on
• 18:33
  Speaker 2: the progressive left, not only in Michigan but everywhere and
• 18:37
  Speaker 2: everything since ex Ober the seventh has been tricky for
• 18:40
  Speaker 2: the Democrats from that point of view, because they have
• 18:43
  Speaker 2: on one side they're traditionally strong support amongst Jewish Americans
• 18:49
  Speaker 2: saying you're not doing enough, you are not supportive enough,
• 18:54
  Speaker 2: and then you have the Michigan Muslims and the woke
• 18:57
  Speaker 2: fellow travelers saying you're being far too helpful to Israel.
• 19:01
  Speaker 2: And this is a very difficult issue for the Biden campaign,
• 19:05
  Speaker 2: and it's going to continue to be difficult right through
• 19:08
  Speaker 2: the year because it ain't over in the Middle East.
• 19:11
  Speaker 2: They're certainly going to be a further round of conflict there.
• 19:15
  Speaker 2: I would imagine that the IDF will go after Hesballa
• 19:19
  Speaker 2: at some point on the Lebanese border between now and
• 19:23
  Speaker 2: the election, and so the issue is not going to
• 19:25
  Speaker 2: go away. And that's why I think Adrian has a
• 19:27
  Speaker 2: really good point about the Chicago convention, because if if
• 19:30
  Speaker 2: the Charkago convention coincides, then is really offensive against Hesballah,
• 19:35
  Speaker 2: it's going to get pretty great for Biden. Yeah, that
• 19:39
  Speaker 2: could be a that could be a problem, But I
• 19:40
  Speaker 2: don't think Columbia students are a problem for the Democrats,
• 19:44
  Speaker 2: not yet.
• 19:45
  Speaker 4: Why is Biden not walking this as an incumbent president
• 19:50
  Speaker 4: with a booming economy, a really strong economy, How does
• 19:53
  Speaker 4: it look so close?
• 19:55
  Speaker 2: That's an easier question. Larry Sommers came with a paper
• 20:01
  Speaker 2: a couple of weeks ago now saying, yeah, it's true
• 20:05
  Speaker 2: that inflation has come down since the spike of twenty
• 20:08
  Speaker 2: twenty two. Remember, inflation got up to nine percent consumer
• 20:12
  Speaker 2: price index inflation, and of course people didn't like that.
• 20:15
  Speaker 2: Been a long time since anybody saw nine percent inflation
• 20:18
  Speaker 2: in the US, and there's a lot of resentment that persists.
• 20:22
  Speaker 2: People are also sensitive to food inflation, and they're sensitive
• 20:26
  Speaker 2: to gasoline inflation, and there's still a sense that the
• 20:28
  Speaker 2: Federal Reserve hasn't got this under control. Larry's argument was,
• 20:34
  Speaker 2: you have to remember that although mortgages can be set
• 20:37
  Speaker 2: for very long periods in the United States, the land
• 20:40
  Speaker 2: of the thirty year mortgage. There are lots of other
• 20:43
  Speaker 2: forms of debt that are far more sensitive to interest rates,
• 20:46
  Speaker 2: and he argues, you've got quite a lot of pain
• 20:50
  Speaker 2: in auto loans and another short maturity consumer debt. I
• 20:54
  Speaker 2: think that's an important point. I think if you look
• 20:58
  Speaker 2: closely at the labor mark, the first signs of that
• 21:02
  Speaker 2: long awaited and now no longer believed in recession can
• 21:08
  Speaker 2: be seen. So the nightmare scenario for Team Biden is
• 21:12
  Speaker 2: that the economy looks terrible by the time we get
• 21:14
  Speaker 2: to labor Day, and then people will I think, revert
• 21:18
  Speaker 2: to a negative view of the Biden economy. When I
• 21:20
  Speaker 2: heard that the Biden team wanted to run on the economy,
• 21:23
  Speaker 2: which was like last year's story, I'm like, good luck
• 21:26
  Speaker 2: with that. That that will lose the election. So they've
• 21:29
  Speaker 2: had to flip to a different strategy, which is running
• 21:32
  Speaker 2: on Trump and then desperately trying to get Trump to
• 21:35
  Speaker 2: say something about abortion that they can then run against.
• 21:38
  Speaker 2: But yeah, the economy doesn't work for them as an issue.
• 21:41
  Speaker 2: If they had stuck with that plan, then I think
• 21:43
  Speaker 2: Trump would have had a good shot at winning.
• 21:45
  Speaker 4: When I was in New York Las week. I notice
• 21:47
  Speaker 4: talking to money people, to finance people, and the rest
• 21:52
  Speaker 4: of it is how many people are leaning to Trump,
• 21:56
  Speaker 4: saying that we could really lower corporate taks a bit
• 21:59
  Speaker 4: more deregulation and the booming economy will boom even more.
• 22:02
  Speaker 4: I hadn't expected so many, as it were respectable, educated
• 22:06
  Speaker 4: people who happened to be rich, to be pro Trump.
• 22:09
  Speaker 4: Is that a distorted impression of what's going on? Or
• 22:12
  Speaker 4: is there a sort of shift amongst the wealthier people.
• 22:15
  Speaker 4: This is in New York, which is not exactly democratic stronghold.
• 22:19
  Speaker 2: I think that there are a number of issues that
• 22:24
  Speaker 2: matter a lot to the wealthy elite of New York,
• 22:28
  Speaker 2: and those include elite universities and the culture conflict that
• 22:36
  Speaker 2: has been going on there since October the seventh. Wall
• 22:39
  Speaker 2: Street had not noticed, despite my attempts to point it
• 22:43
  Speaker 2: out over the past ten years, that the alma mater
• 22:46
  Speaker 2: they felt so warmly towards had gone bananas. But after
• 22:52
  Speaker 2: October the seventh, they noticed, and that was when Wall
• 22:56
  Speaker 2: Street began to care finally about what happened to the
• 23:01
  Speaker 2: hundreds of millions of dollars that they chuck at Harvard
• 23:03
  Speaker 2: and Columbia. So I think that's part of what's going on.
• 23:07
  Speaker 2: When you talk to the Wall Street crowd, A lot
• 23:10
  Speaker 2: of them have had the scales fall from their eyes
• 23:14
  Speaker 2: about work academia a bit belatedly in my view, but
• 23:18
  Speaker 2: they finally got the message. There's also a sense that
• 23:22
  Speaker 2: the economy was an absolute home run for Donald Trump.
• 23:27
  Speaker 2: People forget, but the Trump administration's economic outcomes were among
• 23:33
  Speaker 2: the best of any presidential term since Ron Reagan, and
• 23:37
  Speaker 2: one might even go back further and say about as
• 23:40
  Speaker 2: good as the post war period has seen because after
• 23:45
  Speaker 2: a period of what seventeen years of flatlining, median household
• 23:49
  Speaker 2: income in real terms went up by more than ten
• 23:52
  Speaker 2: percent in the first three years pre COVID of the
• 23:55
  Speaker 2: Trump residency, and even after COVID was still substantially up
• 24:00
  Speaker 2: where it had been between nineteen ninety nine and twenty sixteen.
• 24:03
  Speaker 2: By the way, it's in negative territory under Joe Biden.
• 24:06
  Speaker 2: Last I checked, Wall Street would love to have a
• 24:10
  Speaker 2: repeat of the Trump rally that kicked off pretty much
• 24:13
  Speaker 2: on election Night in November twenty sixteen. Now, I'm sure
• 24:18
  Speaker 2: that this is a flawed analogy, because I don't think
• 24:22
  Speaker 2: a second Trump term will be anything like the first
• 24:26
  Speaker 2: Trump term because the conditions, the initial conditions are so different.
• 24:29
  Speaker 2: But there's definitely a perfectly straightforward view that the Trump
• 24:34
  Speaker 2: administration was pretty good at the economy, and so why
• 24:37
  Speaker 2: not have the Trump administration two point zero?
• 24:39
  Speaker 3: Because we are also we're going to be very global
• 24:42
  Speaker 3: on this podcast, and we are also specifically thinking about
• 24:48
  Speaker 3: how geopolitics is intervening in the way everyone thinks about everything.
• 24:52
  Speaker 3: And I was struck by something you said in a
• 24:53
  Speaker 3: recent column that you seem to be saying that that
• 24:56
  Speaker 3: isolationism was just not going to win out in US politics,
• 25:00
  Speaker 3: and that President Trump had recognized that or was likely
• 25:03
  Speaker 3: to recognize that having seen a bipartisan consensus develop over
• 25:08
  Speaker 3: the need to confront China in this kind of new
• 25:12
  Speaker 3: Cold War. Is that sort of wishful on your part,
• 25:15
  Speaker 3: or you think genuinely isolationism is not going to be
• 25:18
  Speaker 3: a winning strategy in the US for either party.
• 25:21
  Speaker 2: I don't think it's plausible, and I think it's very striking.
• 25:26
  Speaker 2: The Speaker Johnson Mike Johnson, relatively recently installed House Speaker,
• 25:32
  Speaker 2: went from being opposed to funding Ukraine's war effort to
• 25:38
  Speaker 2: arguing passionately for doing so. Why was that because the
• 25:43
  Speaker 2: intelligence briefings scared the hell out of him, And I
• 25:47
  Speaker 2: just wish that Marjorie Taylor Green could have had those
• 25:50
  Speaker 2: briefings too, because if you let Russia win in Ukraine,
• 25:54
  Speaker 2: that is no bueno from almost any vantage point that
• 25:58
  Speaker 2: is rational. I'm excluding the Tucker Carlson position that it
• 26:02
  Speaker 2: would just be fine if Putin won. The interesting thing
• 26:06
  Speaker 2: about this is that Trump himself changed the conversation on
• 26:12
  Speaker 2: US national security strategy, which for the entire period, really
• 26:16
  Speaker 2: after the end of the Cold War, had been a
• 26:20
  Speaker 2: sleep walk towards Chinese ascendancy, culminating when Susan Rice was
• 26:25
  Speaker 2: Obama's National security advisor and the national security strategy basically
• 26:30
  Speaker 2: said China's rising, Oh well, it's okay, why worry? And
• 26:35
  Speaker 2: Trump campaigned against China was as important as the border issue.
• 26:41
  Speaker 2: In twenty sixteen, he came in, he talked about tariffs
• 26:44
  Speaker 2: and China. He'd been really fueled by the policy elite,
• 26:47
  Speaker 2: which has been up until the Trump presidency on critically
• 26:51
  Speaker 2: pro free trade. And the Trump administration completely changed the
• 26:55
  Speaker 2: conversation because they imposed the tariffs, they stood up to China,
• 27:00
  Speaker 2: they rewrote the national security strategy as one of competition
• 27:03
  Speaker 2: with China as the main US rival along with Russia.
• 27:07
  Speaker 2: HRC Master Nadia Shadlow nailed it fantastic document set a
• 27:12
  Speaker 2: new course for American strategy that the Biden administration did
• 27:15
  Speaker 2: not dare change. And on this issue, it seems to
• 27:19
  Speaker 2: me Trump has a lot of credibility because everything that
• 27:23
  Speaker 2: the Trump administration said about China has turned out to
• 27:27
  Speaker 2: be right. I think the isolationist position is inherently stupid.
• 27:33
  Speaker 2: It's like being an apologist for the Ttalitarians in the
• 27:36
  Speaker 2: nineteen thirties and nineteen forties. You're just getting it wrong
• 27:40
  Speaker 2: because they clearly aspire to a world in which American
• 27:44
  Speaker 2: privacy is over. That's the one thing that brings Jan
• 27:48
  Speaker 2: Ping and Vladimir Putin and the Iatolis in Tehran and
• 27:53
  Speaker 2: Kim Jong In together. They don't have anything in common
• 27:55
  Speaker 2: except that they really quite against democracy, the rule of law,
• 27:58
  Speaker 2: individual freedom, and primacy. An isolationist positions, such as Tucker
• 28:03
  Speaker 2: Carlson staked out after he left Fox, is as big
• 28:07
  Speaker 2: a loser in my view as the same position was
• 28:09
  Speaker 2: in the nineteen thirties. That all the Republicans have to
• 28:12
  Speaker 2: do is as Mitke Pultinger and Mike Gallagher argue in
• 28:17
  Speaker 2: the latest Issue of Foreign Affairs is be more hawkish
• 28:20
  Speaker 2: than the Democrats, who have been really bad at foreign policy.
• 28:24
  Speaker 2: It's like how not to do deterrence one oh one,
• 28:27
  Speaker 2: twenty twenty two, total failure to deter Pudin from invading Ukraine,
• 28:30
  Speaker 2: twenty twenty three, total failure to Iran from unleashing its
• 28:34
  Speaker 2: proxies against Israel, and twenty twenty four they can't even
• 28:38
  Speaker 2: deter Bibi from finishing off Hamas in Gaza. And so
• 28:43
  Speaker 2: this administration is terrible at foreign policy. It's really woeful.
• 28:46
  Speaker 2: After it makes Jimmy Carter look like one of the
• 28:49
  Speaker 2: masters of geopolitics. If the Trump campaign could focus on that,
• 28:53
  Speaker 2: if that was what the electorate really cared about, then
• 28:56
  Speaker 2: Trump would win the way Reagan won in nineteen.
• 28:58
  Speaker 3: Eighty without all the deals. I think I would absolutely
• 29:02
  Speaker 3: agree with you that President Trump was the one who
• 29:06
  Speaker 3: did most to provide a wake up call and a
• 29:09
  Speaker 3: recognition that the China strategy of those many years had
• 29:13
  Speaker 3: been completely wrong, or at least been disproved by Shijinping's
• 29:17
  Speaker 3: approach to government. I was sitting in US Treasury when
• 29:20
  Speaker 3: we let China into the WTO, and that the view
• 29:22
  Speaker 3: of how that was going to go just turned out
• 29:25
  Speaker 3: completely wrong. But the problem I find when I think, okay,
• 29:29
  Speaker 3: is President Trump going to be ironically a less scary,
• 29:33
  Speaker 3: potentially more constructive force on the international stage if he's
• 29:37
  Speaker 3: reelected than these as you described incompetent President Biden and
• 29:42
  Speaker 3: Tony Blincoln. I've got two problems with that. One is,
• 29:46
  Speaker 3: although President Trump has often sounded very belligerent about China
• 29:51
  Speaker 3: and raised the alarm, he's also come across as quite
• 29:54
  Speaker 3: liking dictators, wanting to do deals, and he's very against
• 29:58
  Speaker 3: underpinning a sort of packs America if there's a threat
• 30:01
  Speaker 3: on Taiwan. It's not clear to me looking at Trump's
• 30:04
  Speaker 3: previous pronouncements, some of them suggests he would underpin Taiwan's security,
• 30:10
  Speaker 3: quite a lot of them suggest otherwise. And the other
• 30:12
  Speaker 3: thing I would say is his clientalism, whether it's over
• 30:16
  Speaker 3: TikTok Ban or other things. He seems quite keen to
• 30:20
  Speaker 3: respond to kind of business lobbying and business pressure. It
• 30:23
  Speaker 3: doesn't seem to take much to get him to kind
• 30:25
  Speaker 3: of roll over on some of these things. So I
• 30:27
  Speaker 3: just I take a lot of what you're saying. But
• 30:30
  Speaker 3: I just wonder on those two points, is he going
• 30:33
  Speaker 3: to want to underpin the security of Asia and isn't
• 30:37
  Speaker 3: he going to be quite easily bought off.
• 30:39
  Speaker 2: That's a reasonable question to ask, Stephanie. But one has
• 30:43
  Speaker 2: to remember that the president isn't the king. In practice.
• 30:48
  Speaker 2: The president sits a top a complex national security bureaucracy,
• 30:53
  Speaker 2: and it's only got more complex over the last fifty years,
• 30:57
  Speaker 2: and it has to be staffed by people who know
• 31:00
  Speaker 2: what they're doing. And you just can't make Tucker secondary state.
• 31:05
  Speaker 2: That's not an option. So you have to look around
• 31:08
  Speaker 2: and ask who will staff up the second Trump administration,
• 31:12
  Speaker 2: and the answer is people like my Pompeo and Matt
• 31:15
  Speaker 2: Pottinger and maybe Mike Gallaher, and those people are all
• 31:19
  Speaker 2: much more hawkish and much more convinced that behind every
• 31:23
  Speaker 2: threat to democracy, whether it's in Ukraine or in Taiwan
• 31:28
  Speaker 2: or in Israel, is the Chinese Communist Party. So although
• 31:31
  Speaker 2: Trump himself is transactional and has a kind of level
• 31:35
  Speaker 2: of cynicism, but that is always somewhat staggering in practice.
• 31:40
  Speaker 2: Or Republican administration is unlikely to sell Taiwan for a
• 31:46
  Speaker 2: bunch of golf courses or casinos with John Bolton's passage
• 31:50
  Speaker 2: that everybody should And in that passage, Adrian you may
• 31:53
  Speaker 2: have read it, Trump is explaining the significance of Taiwan
• 31:57
  Speaker 2: and he pulls that He's sitting in the Oval office,
• 31:59
  Speaker 2: and he pulled it's a sharpie, these pens that he
• 32:03
  Speaker 2: likes to sign his name with. And he says, you
• 32:05
  Speaker 2: see this, sharpie, this is Taiwan. You see this desk
• 32:09
  Speaker 2: of the Resolute, this is China. Are we really going
• 32:12
  Speaker 2: to send the US Navy across the Pacific to rescue
• 32:15
  Speaker 2: a sharpie? That's how Trump feels. And by the way,
• 32:18
  Speaker 2: it's not a stupid position, because actually going to war
• 32:21
  Speaker 2: over Taiwan, in my view, would be the single stupidest
• 32:25
  Speaker 2: thing an American administration can do at this point, because
• 32:27
  Speaker 2: there would be a non trivial chance that it would lose.
• 32:30
  Speaker 2: So I don't disagree with Trump that staking the future
• 32:34
  Speaker 2: of American power on a naval expedition to run a
• 32:37
  Speaker 2: blockade of Taiwan is a bad idea. But if you
• 32:41
  Speaker 2: talked to Mike Pompeo or Matt Pottinger or Mike Galpher
• 32:45
  Speaker 2: or Elbert Tolby, for example, who might still be in
• 32:47
  Speaker 2: a Trump administration. They will all tell you that this
• 32:50
  Speaker 2: is the make or break decision of their lives. So
• 32:53
  Speaker 2: I don't think it's possible to imagine a fully staffed
• 32:56
  Speaker 2: isolationist administration or a fully staffed trump is administration that
• 33:01
  Speaker 2: we just do deals on all of these Nash.
• 33:05
  Speaker 4: Isn't there a case for Trump's transactionalism and for his
• 33:09
  Speaker 4: lack of consistency in the sense that we need to
• 33:11
  Speaker 4: have two sets of policies towards China. We need to
• 33:14
  Speaker 4: stand up to it, but we also need to trade
• 33:16
  Speaker 4: with it and engage with it. And just because liberal
• 33:18
  Speaker 4: engagement didn't work all the time when Stephanie was in
• 33:22
  Speaker 4: the Treasury, it doesn't mean that he can't work at
• 33:24
  Speaker 4: some point in the future. She didn't pink May at
• 33:27
  Speaker 4: some point will at some point die. There is a
• 33:30
  Speaker 4: liberal faction within liberal in loose terms, within China. We
• 33:35
  Speaker 4: need to give them some sort of off ramp whereby
• 33:38
  Speaker 4: we can say, if you behave in a different sort
• 33:40
  Speaker 4: of way, you're in a more liberal way, we will
• 33:44
  Speaker 4: engage with it. We will have a different sort of
• 33:46
  Speaker 4: set of policies. So I'm not sure that the consistency
• 33:48
  Speaker 4: of Pompeo is better than the inconsistency and opportunism of Trump.
• 33:53
  Speaker 2: I'll just imagine a scenario like in November the sixth,
• 33:56
  Speaker 2: No sooner have we got the results in than we
• 34:00
  Speaker 2: hear that there's a blockade of Taiwan, which the Chinese
• 34:02
  Speaker 2: could do tomorrow, but they might wait until after the election.
• 34:05
  Speaker 2: What then, what do you do? Because if you send
• 34:08
  Speaker 2: the naval expeditionary force, like I don't know, two or
• 34:12
  Speaker 2: three aircraft carrier strike groups, there's a non trivial risk
• 34:16
  Speaker 2: that you are rerunning the Cuban missile crisis with the
• 34:21
  Speaker 2: real risk of World War III, and we're not particularly
• 34:24
  Speaker 2: well positioned for that war as things stand. It is
• 34:29
  Speaker 2: not nineteen eighty, it's not the mid nineteen nineties. Either.
• 34:31
  Speaker 2: The Chinese can sink US aircraft carriers. They've got missiles
• 34:35
  Speaker 2: that can do just that, and we would run out
• 34:37
  Speaker 2: of precision missiles in a week, and the war games
• 34:41
  Speaker 2: are pretty clear on that. So I think the US
• 34:44
  Speaker 2: should be speaking a lot more softly about Taiwan and
• 34:47
  Speaker 2: trying to find the big stick that it currently doesn't have.
• 34:51
  Speaker 2: And until such times as you have that big stick.
• 34:54
  Speaker 2: The right strategy is they don't negotiate with them, engage
• 34:57
  Speaker 2: with them, whatever it is, arms control, economics, exchanges, just
• 35:03
  Speaker 2: talk about it. European security talk about it is better
• 35:06
  Speaker 2: to be engaged in those conversations with the other superpower
• 35:11
  Speaker 2: than to risk a Cuban missile crisis, which is way
• 35:13
  Speaker 2: too dangerous. And I think that's what the Biden people
• 35:17
  Speaker 2: wanted to do. I think that was definitely Jake Sullivan's instinct.
• 35:21
  Speaker 2: I think that was what they were trying to achieve
• 35:23
  Speaker 2: in the run up to the meetings in November. The
• 35:25
  Speaker 2: problem they had was, as in the First Cold War,
• 35:29
  Speaker 2: you're doing daketall when the midd least blows up and
• 35:31
  Speaker 2: you weren't expecting that. He certainly wasn't expecting that, and
• 35:34
  Speaker 2: it happens, and it's greatly weakened the national security strategy
• 35:39
  Speaker 2: of Team Biden. That's why they're in trouble at the moment.
• 35:42
  Speaker 2: Not their China policy, which I think was quite smart.
• 35:44
  Speaker 2: In fact, the China policy of the Biden administration was
• 35:48
  Speaker 2: especially smart because they found the Chinese Achilles Heel, which
• 35:52
  Speaker 2: turned out to be high end semiconductors.
• 35:55
  Speaker 4: As somebody who jumps from one side of the Atlantic
• 35:58
  Speaker 4: to another. What do you say I'm seeing in Britain
• 36:01
  Speaker 4: in terms of ourcoming election, which may well be almost
• 36:05
  Speaker 4: the same time as the election as the Trump Biden election,
• 36:09
  Speaker 4: that you've seeing any interesting patterns emerging that might cast
• 36:13
  Speaker 4: light between the two.
• 36:15
  Speaker 2: There's all almost complete disconnects. But itcause Britain's rerunning the
• 36:20
  Speaker 2: nineteen seventies, like some brilliantly executed BBC costume drama in
• 36:27
  Speaker 2: which everybody talks as if it's the nineteen seventies. Ah well,
• 36:30
  Speaker 2: mustn't grumble. Nothing works and you go from a weak
• 36:34
  Speaker 2: conservative government or a weak labor government. They'll make it worse,
• 36:39
  Speaker 2: won't they. I mean, pretty kear Starmer as he enters
• 36:43
  Speaker 2: Downing Street. The predicament is really dire from the point
• 36:49
  Speaker 2: of view of the fiscal situation and all the wonderful
• 36:54
  Speaker 2: things that Rachel Reeves said in her much lauded speech
• 36:58
  Speaker 2: reminded me of the white heat of technology. And it's
• 37:01
  Speaker 2: going to be just Wilson Reducts with the inevitable consequences.
• 37:07
  Speaker 2: So Britain's going to rerun the seventies and it's going
• 37:11
  Speaker 2: to be probably good for sitcom and music and terrible
• 37:16
  Speaker 2: for just about everything else.
• 37:17
  Speaker 4: But we had this surge of populism that generated Brexit
• 37:20
  Speaker 4: and Boris Johnson, and we had a surge of populism
• 37:23
  Speaker 4: in the United States that generated Trump. Why have they
• 37:26
  Speaker 4: moved in such different directions in terms of politics, Because
• 37:30
  Speaker 4: trump Ism had a serious and credible case that if
• 37:37
  Speaker 4: you changed your attitude.
• 37:40
  Speaker 2: On taxation, which they did, and on China, which they did,
• 37:46
  Speaker 2: and tried to toughen up border policing, which they did,
• 37:51
  Speaker 2: they would be meaningful economic benefits to the average American household.
• 37:55
  Speaker 2: That was a serious and well executed platform. The problem
• 38:01
  Speaker 2: with Brexit was that it contained a good deal of
• 38:05
  Speaker 2: rhetoric and high quality marketing. Don Cummings very good at that,
• 38:09
  Speaker 2: but the content was utterly vacuous. I'm afraid to say
• 38:13
  Speaker 2: that if one looks back on the economic critique of
• 38:17
  Speaker 2: the Brexit of the Leave case, it was right that
• 38:20
  Speaker 2: it was simply going to be very costly for Britain
• 38:23
  Speaker 2: to exit the European Union. It was a divorce with
• 38:27
  Speaker 2: a pretty high price tag, and that price tag would
• 38:30
  Speaker 2: take the form, amongst other things, of the serious decline
• 38:34
  Speaker 2: in investment. So the problem with Brexit was that it
• 38:38
  Speaker 2: was not really economically serious. I love you, but you're
• 38:41
  Speaker 2: not serious people. That's how I feel about all my
• 38:44
  Speaker 2: friends who supported Brexit. I love you, but you're not
• 38:47
  Speaker 2: serious people. When I read the case for Brexit, just
• 38:50
  Speaker 2: as an economic historian, I was like, this is stupid.
• 38:53
  Speaker 2: This is stud I wouldn't give a graduate student a
• 38:56
  Speaker 2: B for this. It's like a C paper. So I
• 38:59
  Speaker 2: was wi. I was a remainer, not because I have
• 39:01
  Speaker 2: warm feelings towards Brussels, but just because I can see
• 39:04
  Speaker 2: stupid when I see stupid written down. Bit was economic stupidity,
• 39:09
  Speaker 2: and it shows Look at the UK today.
• 39:12
  Speaker 3: Sadly we begin to live it. You see it, and
• 39:15
  Speaker 3: we get to live it.
• 39:16
  Speaker 2: Yeah, it's Mississippi. It's Mississippi. Is the economic outcome. You
• 39:20
  Speaker 2: look at it. You look at the rest of the
• 39:22
  Speaker 2: country outside London, which remains a prosperous city, and it's
• 39:25
  Speaker 2: really quite I mean, I've spent most of the last
• 39:27
  Speaker 2: quarter century working in the US and now I'm spending
• 39:31
  Speaker 2: much more time in the UK for family reasons, and
• 39:33
  Speaker 2: it's pretty provincial. Britain is a shockers Mississippispi.
• 39:38
  Speaker 4: Mississippi is rich compared with a lot of provincial Britain.
• 39:42
  Speaker 3: That opens a whole other Neil, you have. You've given
• 39:45
  Speaker 3: us a fantastic start to this series and plenty of
• 39:49
  Speaker 3: topics to return to. And I'm sure there will be
• 39:53
  Speaker 3: people spluttering over their tea or anything stronger as they
• 39:56
  Speaker 3: listen to or trip over the dog lead as they
• 39:58
  Speaker 3: walk the dog. I guess the only the obvious question
• 40:01
  Speaker 3: that arises from some of what you've said, if there
• 40:04
  Speaker 3: are going to be grown ups in the room in
• 40:06
  Speaker 3: our next Trump administration, is Neil Ferguson available for any
• 40:09
  Speaker 3: of these roles.
• 40:10
  Speaker 2: The answer to that question is the question was put
• 40:14
  Speaker 2: to me in late twenty sixteen after the election, and
• 40:20
  Speaker 2: I went to Trump Tar and I met a number
• 40:23
  Speaker 2: of the key protagonists in a very surreal afternoon. And
• 40:30
  Speaker 2: after I had met Anthony Scaramucci and Mike Flynn and
• 40:35
  Speaker 2: Steve Bannon and Michael Cohen, I phoned my wife up
• 40:39
  Speaker 2: and I said, this will end in a welter of litigation.
• 40:43
  Speaker 2: We're going to have nothing to do with it. Good call.
• 40:47
  Speaker 3: Who knows you might still get another knock on the door.
• 40:49
  Speaker 3: But thank Neil fergus and thank you so much.
• 40:55
  Speaker 1: I read that transcript. First thing, this morning. I didn't
• 40:59
  Speaker 1: listen to it just now, and it was like drinking
• 41:01
  Speaker 1: ten shots of coffee in one go. And I don't
• 41:04
  Speaker 1: drink caffeine anymore. So can you imagine that my poor
• 41:07
  Speaker 1: body from the paper? It felt like he thought that
• 41:11
  Speaker 1: that Trump was. I think he thinks he's going to win.
• 41:14
  Speaker 4: I think he would probably consider, as most people would,
• 41:17
  Speaker 4: that you can't really tell with Trump. He's such an
• 41:19
  Speaker 4: unpredictable figure. He might go in all sorts of directions,
• 41:22
  Speaker 4: but nevertheless that there is a possibility that for economic reasons,
• 41:26
  Speaker 4: for business reasons, and for foreign policy reasons, he might
• 41:29
  Speaker 4: not be the disaster that most of the sort of
• 41:32
  Speaker 4: global establishment is.
• 41:34
  Speaker 3: I was quite strong that well, but I was quite
• 41:37
  Speaker 3: struck that, you know, especially when I was sort of
• 41:39
  Speaker 3: pinning him down a bit on sort of can we
• 41:41
  Speaker 3: really count on Trump to quote unquote do the right
• 41:46
  Speaker 3: thing when it comes to Taiwan or other things that
• 41:49
  Speaker 3: he fell back on saying, oh, there'll be grown nuts
• 41:52
  Speaker 3: in the room. You can't bear a secretary of State
• 41:54
  Speaker 3: job to you know, any old person. Whereas actually the
• 41:57
  Speaker 3: impression you get very much of trum two point. Oh,
• 42:01
  Speaker 3: it's precisely that it will be the people who Trump
• 42:04
  Speaker 3: can absolutely rely on who will defer to him, and
• 42:08
  Speaker 3: all the people who were the grown ups in the
• 42:10
  Speaker 3: room often didn't last very long in the first Trump
• 42:13
  Speaker 3: administration will be nowhere to be seen. So I thought
• 42:15
  Speaker 3: it was interesting that he was still sort of relying
• 42:17
  Speaker 3: very heavily on that.
• 42:18
  Speaker 4: It was very much a twenty sixteen mindset. You know,
• 42:21
  Speaker 4: we've got this crazy guy, but there's lots of responsible
• 42:25
  Speaker 4: people who can hold him back. Now we learned We've
• 42:27
  Speaker 4: learned a couple of things in recent years. One is
• 42:30
  Speaker 4: that those responsible people can't necessarily hold him back because
• 42:34
  Speaker 4: he's this sort of extraordinary figure, unpredictable figure. But secondly
• 42:38
  Speaker 4: that you're getting the emergence of a real sort of
• 42:43
  Speaker 4: populist policy, established populist intelligence, so that it won't be
• 42:46
  Speaker 4: just the old Republican wise men who will be in
• 42:49
  Speaker 4: the room, the whole group of new intellectuals, of new policy,
• 42:52
  Speaker 4: people who really believe in this populist agenda, who really
• 42:55
  Speaker 4: believe in isolationism. You've got groups like the Heritage Foundation
• 42:59
  Speaker 4: who this enormous policy document which is all about strong governments,
• 43:04
  Speaker 4: about getting rid of checks and balances, which is about
• 43:07
  Speaker 4: empowering true trumpst believers, and they've got binders full of populists.
• 43:13
  Speaker 4: They've got a whole set of people that they want
• 43:16
  Speaker 4: to populate the White House who weren't available before. So
• 43:21
  Speaker 4: I think he's thinking applying a twenty sixteen paradigm to
• 43:24
  Speaker 4: something that's going to be a very different thing. I
• 43:26
  Speaker 4: just wanted to say one other thing about the nature
• 43:29
  Speaker 4: of our conversation, which I think really illustrates the world
• 43:33
  Speaker 4: that we're talking about. We're talking about Taiwan. Now, what
• 43:36
  Speaker 4: has Taiwan been since about nineteen eighty It's been this
• 43:39
  Speaker 4: place where you produce cheap stuff and then you produce semiconductors.
• 43:44
  Speaker 4: Everybody has seen it as a fantastic place where you
• 43:47
  Speaker 4: can get all this manufacturing skill, you can produce all
• 43:50
  Speaker 4: this really cheap good stuff. It now produces ninety percent
• 43:54
  Speaker 4: of the world's semiconductors. This has one of the world's
• 43:56
  Speaker 4: great companies, the world's greatest semiconductor producing company in the world.
• 44:01
  Speaker 4: There everybody had seen it through that lens. Now in
• 44:05
  Speaker 4: this conversation with seeing Taiwan through a very different lens,
• 44:09
  Speaker 4: is it somewhere that we should go to war to protect?
• 44:12
  Speaker 4: Or is it somewhere that we might concede to China
• 44:14
  Speaker 4: because they care more about it. That's a dramatic demonstration
• 44:19
  Speaker 4: of the theme that is at the heart of this.
• 44:21
  Speaker 2: You called it a.
• 44:21
  Speaker 1: Sharpie pen, didn't he.
• 44:25
  Speaker 3: And it's a sort of example of parts of the
• 44:28
  Speaker 3: world that you know, not just the sort of foreign
• 44:32
  Speaker 3: policy makers or indeed sort of foreign correspondents need to
• 44:37
  Speaker 3: know about, but even potentially you know, suppliers of things
• 44:42
  Speaker 3: you know in different parts of Britain or different parts
• 44:45
  Speaker 3: of Europe. You know, just like the Red Sea. Everyone
• 44:47
  Speaker 3: going to the map to work out where the Red
• 44:49
  Speaker 3: Sea is that they haven't had to think about quite
• 44:51
  Speaker 3: a long.
• 44:51
  Speaker 1: Absolutely, that's it, and I thought the challenge from both
• 44:53
  Speaker 1: of you was very important around hold on a second.
• 44:56
  Speaker 1: From the American perspective, it might be one thing to
• 44:59
  Speaker 1: be so tough on China and tariffs and goods coming
• 45:02
  Speaker 1: over part because they make so much. It is different
• 45:05
  Speaker 1: from the UK's perspective, and again from a sort of
• 45:07
  Speaker 1: voteromics perspective, thinking about what is it what does something
• 45:10
  Speaker 1: mean to voters if you are thinking about prices going up,
• 45:14
  Speaker 1: because as you say, so much is being made in
• 45:16
  Speaker 1: that part of the world that has been consumed by Brits.
• 45:19
  Speaker 1: It's not always true for Americans. So you've got you know,
• 45:22
  Speaker 1: UK potentially in the next year, if there's a President
• 45:25
  Speaker 1: Trump the second where we are having to watch this this.
• 45:31
  Speaker 3: Is it a trade war?
• 45:32
  Speaker 1: I don't know what it would become become if you know,
• 45:35
  Speaker 1: not just the tariffs we have at the moment, but
• 45:36
  Speaker 1: there's more tarists put on goods and then the UK,
• 45:38
  Speaker 1: which is more economically dependent on China. What happens to
• 45:42
  Speaker 1: those to that relationship. If we've got a prime minister Starmer,
• 45:45
  Speaker 1: how does he navigate?
• 45:46
  Speaker 3: And I was quite struck by what he's sort of
• 45:50
  Speaker 3: referred in passing to the unsustainability of US fiscal policy
• 45:54
  Speaker 3: and the fact that it's even with a booming economy.
• 45:56
  Speaker 3: You know, you're not supposed to be borrowing a lot
• 45:58
  Speaker 3: with a booming economy's supposed to be when you're sort of,
• 46:01
  Speaker 3: you know, having running some kind of budget surplus, even
• 46:04
  Speaker 3: as we did when I was in the Treasury. Had
• 46:06
  Speaker 3: nothing to do with me, but so the US Treasury.
• 46:10
  Speaker 3: But I was thinking of you, Allegra when he was
• 46:12
  Speaker 3: talking about I think he has often made Neil often
• 46:16
  Speaker 3: makes something of this rule that you a great power
• 46:19
  Speaker 3: doesn't stay great for long if it's spending more on
• 46:23
  Speaker 3: debt interest than it is on defense. And of course
• 46:26
  Speaker 3: that sent me sort of scurrying to see whether we've
• 46:30
  Speaker 3: lasted through that, you know, years ago, as we ran
• 46:33
  Speaker 3: down the defense budget and now we've got very fast
• 46:36
  Speaker 3: rising debt interest payments and it's striking that. You know,
• 46:39
  Speaker 3: this was the week that the Prime Minister decided to
• 46:43
  Speaker 3: to kind of echo what Kirs Starmer has said about
• 46:47
  Speaker 3: wanting to get to two point five percent, and of
• 46:49
  Speaker 3: course he's because he's Prime minister. People take it a
• 46:51
  Speaker 3: bit more seriously. Is the Conservative Party fully on board
• 46:55
  Speaker 3: with doing that relevant instead of tax cuts?
• 46:58
  Speaker 2: Right?
• 46:58
  Speaker 1: Not in that, I mean on the so, I think
• 47:01
  Speaker 1: there is a slight difference between the government and labor.
• 47:05
  Speaker 1: I don't always say that, and in fact, a lot
• 47:08
  Speaker 1: of us aren't saying that very much at the moment
• 47:09
  Speaker 1: because they're sticking the labor is sticking very much to
• 47:11
  Speaker 1: government plans. But on this I think it is different
• 47:14
  Speaker 1: because they're not saying when unless I'm mistaken, And I
• 47:16
  Speaker 1: think that matters because the threat is now, and the
• 47:19
  Speaker 1: threat is is is you know, is ramping up week
• 47:22
  Speaker 1: by week. So I think the timing question is an
• 47:24
  Speaker 1: important one. I wouldn't have thought that Labour's position on
• 47:27
  Speaker 1: not saying when losts I would have thought they'll feel
• 47:29
  Speaker 1: they have to move because otherwise they will be accused
• 47:32
  Speaker 1: of you know, tell that to Donald Trump that you
• 47:34
  Speaker 1: don't know when right. So one, there is a slight difference,
• 47:37
  Speaker 1: but you're right, they're now essentially camping on two point five.
• 47:41
  Speaker 1: It is less than the amount we spend on as
• 47:44
  Speaker 1: you of all people know, definitely it does not be
• 47:46
  Speaker 1: the exactly it doesn't. So we flouted Neil Ferguson's rule
• 47:51
  Speaker 1: that you have to spend more on defense than you
• 47:53
  Speaker 1: do on your debt interest repayments. So we flatted that
• 47:56
  Speaker 1: rule a long time ago. Two point five has it
• 47:59
  Speaker 1: seems like may Richie's soon next. Critics inside his party
• 48:05
  Speaker 1: go quiet. So the people that were calling for it
• 48:07
  Speaker 1: seem happy, probably because any higher has an impact on
• 48:12
  Speaker 1: other public spending. As you say, you said tax cuts,
• 48:15
  Speaker 1: but I would say, actually NHS welfare, you know, pockets
• 48:19
  Speaker 1: of huge, huge budgets that there are constituencies within the
• 48:23
  Speaker 1: Conservative Party who would not want them touching. So I
• 48:26
  Speaker 1: think people are I don't think also, I don't think
• 48:28
  Speaker 1: people saw it coming, correct me if I'm wrong. So
• 48:31
  Speaker 1: I think there was We knew that he was going
• 48:33
  Speaker 1: to Europe at the beginning of the week, but I
• 48:35
  Speaker 1: don't think people thought that there would be a new
• 48:36
  Speaker 1: statement on the amount of GDP that would be spent
• 48:40
  Speaker 1: on defense. So I think I think he's had a
• 48:42
  Speaker 1: decent few days. But next week's going to be very
• 48:44
  Speaker 1: tough because it's these these May elections that for many,
• 48:49
  Speaker 1: many months now people have been saying will be the
• 48:52
  Speaker 1: moment when his critics decide to move again.
• 48:55
  Speaker 4: I think there'll be a number of D words which
• 48:57
  Speaker 4: we'll keep talking about as this podcast developed. One is debt,
• 49:01
  Speaker 4: which is something people have been pretty quiet about for
• 49:03
  Speaker 4: a long time, but it's now coming back. The second
• 49:05
  Speaker 4: is defense, again something that people weren't talking about enough,
• 49:09
  Speaker 4: but is moving back to the center of British politics,
• 49:12
  Speaker 4: just as it has been debated very vigorously in the
• 49:15
  Speaker 4: United States. Demographics with an aging population, with different groups
• 49:18
  Speaker 4: shifting and some interesting shifts going on, particularly the United States,
• 49:22
  Speaker 4: with some black voters and and some Latino voters perhaps
• 49:26
  Speaker 4: shifting to Trump in interesting ways, and just disaster, there's
• 49:31
  Speaker 4: probably going to be another disaster like the disaster of
• 49:34
  Speaker 4: the you know, Hamas atrocity, which will reshape politics yet again.
• 49:39
  Speaker 3: And de escalation.
• 49:40
  Speaker 4: I forgot that.
• 49:42
  Speaker 3: I'm here all week. That's the optimistic one. I thought
• 49:44
  Speaker 3: you were going to add decarbonization.
• 49:46
  Speaker 2: O my god.
• 49:48
  Speaker 1: Yeah, I'm ashamed to say I hadn't even thought of
• 49:51
  Speaker 1: that's definitely, but you are always that. Definitely decarbonization and
• 49:56
  Speaker 1: that awful, terrible one. Digitization is the other.
• 49:59
  Speaker 3: Really and next week so be brought to you by
• 50:03
  Speaker 3: the letter. All right, Well, that's just a taste of folks,
• 50:09
  Speaker 3: and for those of you who liked it, they'll be
• 50:11
  Speaker 3: more like that, and for those of you didn't, we
• 50:13
  Speaker 3: will get better as the weeks go on. But it's
• 50:17
  Speaker 3: it's great fun to sit down with these fine people,
• 50:21
  Speaker 3: and we will be doing many more. Thanks for listening
• 50:29
  Speaker 3: to this week's voter Nomics from Bloomberg. This episode was
• 50:32
  Speaker 3: hosted by Me, Stephanie Flanders, Adrian Wildridge, and alegra Stratton.
• 50:37
  Speaker 3: It was produced by Samma Sadi with help from Thomas lu,
• 50:41
  Speaker 3: Chris Marklu and Julia Manns. Editorial direction from Victoria Wakeley.
• 50:46
  Speaker 3: Sound design by Blake Maples Brendan Francis Newnham is our
• 50:50
  Speaker 3: executive producer and Sage Bowman is head of Bloomberg Podcasts.
• 50:55
  Speaker 3: With special thanks to Neil Ferguson. Please, if you like it, subscribe, rate,
• 51:00
  Speaker 3: and review this show wherever you listen to your podcasts.