Latest / The Fourcast / How Trump’s first 100 days changed the world - China, Canada, Ukraine

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How Trump’s first 100 days changed the world - China, Canada, Ukraine · The Fourcast

0:00
Hello and welcome to this edition of the Forecast again
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from Washington, DC on a very important day because this is
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the 100th day of the second Trump administration.
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Now you would have thought A cause for celebration, but when
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you look at opinion polls, when you look at opinions around the
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world, well, the least you can say is that these 100 days have
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been consequential, although the world is somewhat divided,
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whether in a good way or a bad way.
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Now, the first bit of news that President Trump would have woken
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up to this morning was that Mark Carney, the former governor of
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the Bank of England and the Bank of Canada is now, has now been
0:34
elected as Prime Minister of Canada on a ticket that was
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decidedly, robustly anti Trump. So Mark Carney can say to the
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president of the United States, thank you very much for helping
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me get elected. Does this set a trend for other
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elections around the world? Does is this the beginning of
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the kind of global fight back against Donald Trump and his
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tariffs and his policies to try and bring all this together to
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try and unpeel the onion of 100 days of Donald Trump?
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I'm now joined by our international editor, Lindsay
1:04
Hilsum in London and Helia Ibrahimi, our economics
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correspondent also here in Washington.
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Welcome to you both. Let's start with you, Lindsay,
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then. So Mark Carney becomes Prime
1:13
Minister of Canada. It is difficult to overstate
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just how surprising this is on just about every level.
1:21
Tell us about it. Absolutely.
1:23
The Liberal Party, led by Justin Trudeau, was really down in the
1:29
polls. They had been in government for
1:32
three times. It was time for them to go.
1:34
But then Trump gets in. He imposes these tariffs on
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Canada. He says Canada should become the
1:40
51st state. And suddenly Canadians find this
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incredible patriotic fervour, and it's all against the enemy
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to the South, Trump's America. Canadians have even stopped
1:53
going to Florida on holiday, which they did in droves before.
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And now Mark Carney, formerly head of the Bank of England and
2:03
the Bank of Canada Liberal Party leader, has been elected.
2:08
It's quite a thin margin, but still decisive.
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He is the leader and it is entirely on a platform of
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countering, of standing up to Donald Trump, he said.
2:20
We are over the shock of the American betrayal, but we shall
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never forget the lessons because what he said is that Trump was
2:30
trying to break Canada, but they would never allow that to happen
2:35
because that meant that America wanted to own Canada.
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So it's quite an extraordinary turn around and it's an
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extraordinary moment in Canada as well.
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And also worth pointing out that Mark Carney himself is quite an
2:49
unlikely political candidate. This is the first time he
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actually got elected to an office at the age of 60.
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He worked for Goldman Sachs, he worked in international finance
2:59
for years. He is the archetypal globalist
3:03
and yeah, and frankly, not someone endowed with a huge
3:06
amount of political charisma one would have thought Once Upon a
3:09
time. But I think the secret source of
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his election success, Lindsay, is that he, he spoke strength to
3:16
power in Washington. You know, instead of doing what
3:18
Justin Trudeau did, who who got on the plane to Mar a Lago right
3:21
after the election to basically kiss the ring, Mark County did
3:24
the exact opposite. Yeah.
3:26
And various leaders who dealt with Trump in his first term
3:31
said you have to stand up to him.
3:33
You can't kowtow. But of course, that's very
3:36
complicated for leaders like, for example, Keir Starmer here
3:40
in this country, because Keir Starmer has been, if not
3:44
deferential, at least very respectful to Donald Trump.
3:47
And you know, we all remember when he went to Washington and
3:50
brought out the envelope which was the invitation from King
3:53
Charles for the state visit. But you know, he is also
3:57
standing up to him in some way. And what we understand is that
4:00
there is likely to be some new deal between the UK and the
4:05
European Union, which may be announced in a summit on on the
4:09
the 19th of of May. And of course, Donald Trump
4:13
wants to peel off the UK even further from the European Union.
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So we'll see how that goes down. Helian, It was so fascinating
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about Trump and in a sense, you know, accounts for his own goal
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of him shooting himself in both feet, is the combination of a
4:32
political rhetoric aimed at his base at a domestic American
4:36
audience. You know, Canada should be the
4:37
51st state, all that kind of stuff, which is upset the
4:40
Canadians. And at the same time, the tariff
4:43
policy, although there've been lots of rowbacks on it, the
4:46
tariff policy has really freaked people out on international
4:50
markets, in international governments, but also here in
4:53
the US And it's the combination of those two that has been so
4:57
debilitating for him. Yeah, I I mean, first of all,
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I'd like to say anyone who knows Mark Carney knows that his
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ambitions were always to have a big, big job.
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So he might be an unlikely candidate, but he's one of the
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kind of winners of the fallout of the Trump effect.
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But you're right, there's been absolute chaos in market.
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And I think when you talk to people within businesses, it's
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not just the fact that these tariffs are so eye watering.
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I mean, he's really rolling back global trade more than 100 years
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kind of tariffs we're talking about more than 100% in China
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are excruciating, will definitively raise prices for
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consumers, for American consumers.
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But the problem for companies is beyond that.
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It's the incoherence. It's the fact that there is
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confusion. It is not just the policy, but
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it is the way that this policy has been rolled out.
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One day you're bringing tariffs, the next day you're rolling it
6:00
back, you're telling companies you've got to reassure into the
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US and the next day you're pausing those tags for corporate
6:09
America and for foreign companies looking at bringing
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money here, bringing those Great American jobs here.
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It's created paralysis. It's so interesting because just
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this morning in the White House, and every day this week, they're
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rolling out a different cabinet secretary to give a briefing.
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Just this morning, Scott Besson, the Treasury Secretary, who's
6:29
seen as a kind of designated adult in the Cabinet Room,
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called what you, but hang on a minute, he just called what you
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described strategic chaos, you know, straight out of the, you
6:39
know, that book, The Art of the Deal.
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Well, I don't think, I mean, a lot of people are thinking this
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isn't strategic. This is just chaos.
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Yeah, absolutely right. And I think the, the, the one
6:50
criticism has been, you know, has, has there been corporate
6:54
silence about this? You know, just just as we're
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talking and recording this podcast, there's a brouhaha
7:01
about the fact that Amazon want to disclose how much tariffs are
7:06
going to increase their prices. They're not alone.
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There's a few companies that have talked about labelling the
7:13
price increases. The reaction from the White
7:16
House has been really extreme. They're talking about this
7:19
being, you know, a hostile act, apparently.
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But I mean, for the most part, there's been a lot of coddling
7:27
of Donald Trump by corporates all trying to.
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You were talking about kissing the ring.
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But most of this is just sucking up.
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You know, there's been huge amounts of money made by the
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likes of Goldman Sachs and JP Morgan as there's been chaos on
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markets. All the traders are getting
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rich. But for companies, it's a
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massive blow because they don't know what to do.
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They don't know what he wants. They don't know.
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Is this a negotiation or is this a complete dismantling of the
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global supply chain? And in that space they don't
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know what to do. But interestingly, a lot of them
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feel like, oh, well, Donald Trump is persuadable.
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And therefore, if we don't say anything, we could go to Mar a
8:10
Lago. We could be the last person in
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the room. We could talk to him, we could
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persuade him and get some kind of sidebar deal going that would
8:19
exempt our sector, exempt our company.
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And I think that is a great worry because obviously it it
8:26
breeds corruption. The other great worry for the
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White House is that the numbers in the opinion polls are not
8:31
going in their direction at all. He's down on every single issue,
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including, astonishingly, astonishingly, immigration,
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where he's actually had some results.
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I mean, the the flow of people across the border has virtually
8:44
stopped. The southern border, the flow of
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fentanyl across the border has virtually stopped.
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You know, they've deported, I think 145,000 people since they
8:54
took office So that, you know, that, you know, that's a huge
8:57
number. And of course, controversially,
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some of the people they've deported only just a few days
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ago was in one case a four year old kid with cancer.
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You know, that is not the message they want to send.
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But the point here is that even though people broadly agree with
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his tough line on immigration and shutting the border, they
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don't on the whole. And we saw this when he was
9:15
president the first time. They don't on the whole agree
9:18
with the way he's doing it. Too much fire, you know, too
9:22
much brimstone. They don't like that.
9:24
And so, and you know, the trouble with this, with this
9:26
podcast is that we've got an awful lot to discuss because
9:28
he's done so much in the 1st 100 days.
9:31
And we spent the 1st 10 minutes, it hasn't been quite, and we
9:34
spent the 1st 10 minutes just talking about Canada and some of
9:37
the towers. So Lindsay, let's broaden it out
9:39
a little bit. And, you know, and let's not
9:41
underestimate how much he wanted to change the world and said
9:45
that he would change the world in his inauguration speech.
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And I remember we talked on that day about things like Manifest
9:52
destiny and an openly expansionist policy from an
9:56
American president. And lo and behold, a few days
9:59
later, he talked about Canada, he talked about Greenland, he
10:02
talked about the Panama Canal. Give us some idea of his vision
10:07
of America in his so-called Golden age and how that's going
10:11
so far. Well, it's the policy and the
10:13
process, isn't it? So yes, there's a vision, and
10:16
it's a vision of spheres of influence that he, Donald Trump,
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controls the Western Hemisphere and Vladimir Putin seems to have
10:25
Europe and Xi Jinping seems to have Asia.
10:28
That seems to. And then again, you're talking
10:30
19th century. But within that vision, the
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process is really an important part of any kind of strategy,
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isn't it? And as Helly has just been
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saying, on the economic front, it's chaotic.
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And so it is on the diplomatic front as well.
10:45
So the war between Russia and Ukraine, the Russian invasion of
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Ukraine, which he thought was going to be so easy to end, now
10:53
he says he's going to walk away because it doesn't seem to be
10:55
coming to an end. Well, hang on.
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That is not how you bring a war to an end.
10:59
You don't bring a war to an end by humiliating what the victim
11:04
in the Oval Office and cozying up to the aggressor.
11:08
You do it through long, complex, painstaking diplomacy, which is
11:13
not done at the level of leaders.
11:15
It's done at the level of what they call Sherpas, the level of
11:18
diplomats. And he has no patience for any
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of that, just as, since he has no patience for legislation,
11:26
nothing. I was going to say.
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But this is, this is the whole point of the whole thing, that
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nothing goes through Congress, nothing is done in a way that is
11:34
governance. Now that affects how America
11:36
runs. It affects the economy, it
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affects international affairs. You could say that it's, you
11:42
know, it's, it's the Alice in Wonderland version.
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Why is a Raven like a writing desk?
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Because I say so. That's how he governs.
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It's really nonsense, Lindsay. It's all nonsense.
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I mean, one of the things that's interesting and Lindsay and I
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were just chatting about this a little bit earlier, is China's
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reaction, you know, because there's two things that are
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happening in China. Obviously there is the there is
12:08
going to be a big economic impact in China for these
12:12
tariffs because there is no doubt that the Chinese economy
12:16
is dependent on exports and there will be a noticeable
12:22
impact and damage caused to the economy.
12:25
But the other thing that's happening is they're quite happy
12:28
about all of this dismantling of the American dream.
12:32
It's good news for them. They've got two things going on.
12:36
They've had this kind of technological DeepSeek effect.
12:39
There's a lot of excitement when you talk to Chinese analysts,
12:43
Chinese companies about their kind of corporate advances, the
12:48
fact that they had a tech company, you know, you know that
12:52
the US has been limiting the amount of chips that goes to
12:56
China. And everyone thought that this
12:58
would have a really excruciating impact on China's ambitions to
13:05
become an AI superpower. Well, hang on a moment.
13:08
Just a few months ago they came out and proved they could do it
13:12
cheaper, more efficiently and with indigenous technology that
13:17
has had a huge impact on corporate confidence.
13:21
And on the other side of Christmas, back at in autumn, Xi
13:26
Jinping sat down, had this kind of infamous meeting with all the
13:30
Chinese entrepreneurs, bringing back the likes of Jack Ma,
13:33
bringing them back into the fold and saying, look, we just need
13:37
to go forward and make money. And when you look at it, Chinese
13:41
Navy, Chinese space, Chinese tech, there are huge progresses.
13:46
So if you who were in the Trump camp, there is an argument to
13:50
say that China's progress could protect, could particularly
13:56
create problems on in rare earths in pharma, in vitamins
14:01
and things like that doesn't need to be checked when you've
14:04
got a system like the Chinese system that is clearly
14:08
subsidising state-run enterprises, that is clearly
14:13
suppressing wages. So I think it's very interesting
14:17
that this whole dismantling of the American dream, the big
14:20
beneficiary is China, because they say, as Lindsay was saying,
14:24
they say in comparison, we're really stable.
14:26
We're the grown-ups, we're the sensible people in the room.
14:30
Although I, I spoke to some, can I just just quickly, I spoke to
14:33
some contacts in Beijing last week and they said that actually
14:37
Xi Jinping is on one level terrified by what's going on
14:40
because he himself is in a very vulnerable position at home
14:45
because of corruption, because growth isn't quite what it was,
14:47
because there's still a bit of a lag from, you know, the, the
14:50
disastrous COVID era and so on. But I think what the Chinese do
14:53
have that America doesn't have is an incredible threshold for
14:58
pain. And, you know, pain as as in
15:02
directed from above and it's a police state.
15:05
Let's not forget that. And, and a long term vision for
15:08
planning. We all know, you know, we've all
15:09
seen these amazing pictures of Chinese factories that go up in
15:12
a day. You know, they, they, they build
15:14
a high school railway train in the time it takes the train from
15:17
Brighton to London. And we're still talking about
15:19
130 years later. I mean, you know, they're in a
15:22
completely different universe when it comes to all that stuff.
15:26
But also for China, I guess this is their moment where they test
15:30
themselves and they test their mettle as the emerging
15:33
superpower against the fading superpower.
15:36
And, you know, again, Lindsay, looking at the kind of
15:38
geopolitical landscape, you know, and remembering my game of
15:41
risk as a teenager and A and a few history books, when that
15:44
happens in World history 11 superpower fades.
15:47
The other one emerges and they're locked in the middle of
15:50
a trade war. What could possibly go wrong?
15:53
Well, obviously the ultimate fear is war, but let's look at
15:56
the in the near term. So what did Xi Jinping do
16:00
shortly after the tariffs were imposed?
16:03
He went on a nice little tour of Southeast Asia to Cambodia and
16:07
Malaysia and Vietnam. Now, Vietnam is really
16:11
interesting. There's another anniversary this
16:13
week. It's the 50th anniversary of the
16:16
fall of Saigon. The Americans lost the Vietnam
16:19
War, the war that the Vietnamese, of course, called
16:22
the American War. The Vietnamese won, but the
16:26
Americans have won the peace. And so in recent years, we've
16:31
seen enormous American investment in Vietnam.
16:35
Nike, Puma, all of those sports shoes trainers, most of them are
16:40
made in Vietnam. Oh, they're all coming back to
16:43
the US though, Lindsay. All those are coming back to
16:46
American shores. Yeah, absolutely.
16:49
Yes, I believe that. But the point is that Vietnam
16:53
has steered this very careful course between America and China
16:58
because they see China as a there was, you know, for
17:02
thousands of years of former colonial power.
17:04
They do not want to be dominated by China.
17:07
And America has been quite useful to them in that way.
17:10
And that has been something which has benefited the
17:12
Americans as well, getting their their cheap sport shoes and
17:17
also, you know, investing in in the country and so on.
17:21
But now Vietnam, 46% tariffs. Now that of course was taken off
17:29
waiting for the 90 days, but the 90 days are up on the 9th of
17:34
July. Are the Vietnamese going to get
17:36
a special deal? I don't know.
17:38
President Trump says that everybody is coming to
17:41
Washington to and this is his phrase, not mine.
17:44
Kiss my arse. Well, are they and is that a way
17:48
to conduct foreign affairs? I'm not sure it is.
17:52
And it but also that China offers something Vietnam, which
17:55
is offers Vietnam something better than what the Americans
17:58
are offering and. I think it's really interesting
18:00
when you, when you look at Europe, you know, Europe is
18:02
being asked by the Chinese on the diplomatic level to choose
18:06
between America and China and this sort of, you know, those
18:10
piggies in the middle like the Europeans.
18:12
And that's where we are kind of at the moment will increasingly
18:14
be having to choose between one side and the other.
18:18
And if you're Britain, you have to choose between three sides,
18:21
the European Union, China and the United States.
18:24
If there's a war on trade and there's a war on, you know, and
18:27
security's gone, everyone is having to reassess where their
18:30
interests lie. Lindsay.
18:33
They are and economic security and and diplomatic, you know,
18:39
armed security go together. But I think that the Europeans
18:43
say yes, they're going to pay a lot more for their defence and
18:46
they are not going to say that America is the, you know, going
18:50
to be the largest donor to NATO anymore.
18:53
They know they can't rely on America anymore, at least under
18:56
Donald Trump, and also because they feel viscerally that the
19:01
Russian attack on Ukraine is just one step away from them.
19:05
Geographically it's just one step away from them.
19:08
So it is for their own defence as well.
19:11
But I think that one of the difficult things for the
19:13
Europeans and for other countries as well, is to
19:16
understand whether this is a permanent or a temporary change.
19:20
And sadly, which is very hard to understand, isn't it?
19:23
Helia, what do you think? And I, I think Lindsay, you were
19:26
talking right at the top about Mark Carney being a kind of
19:29
beneficiary of all of these changes.
19:32
One of the things on the economic front for Europe is
19:35
that it's kind of kick them up the ass.
19:38
Basically. You know, all of the spending
19:41
that you're seeing from Germany that is undoubtedly going to be
19:45
a boost for growth in Europe. And there's been a kind of wake
19:49
up call. We had this kind of famous
19:52
report in Europe, the Draggy report, which said Europeans,
19:56
you're not very efficient, you're not very good at growth,
19:59
You're not really working as hard as you can, innovating as
20:03
much as you can. Your productivity sucks
20:06
basically. And everyone thought, Oh, well,
20:09
this is interesting reading and kind of put it aside, I think
20:12
what this kind of chaotic. 100 days has delivered, which is the
20:18
silver lining is places like Europe looking at those things
20:23
and going well, what are we going to do?
20:25
What is the next economy going to be like and and where and
20:30
where should we be focusing? And the kind of spending you're
20:33
seeing from Germany is undoubtedly going to lift the
20:38
European economy. But you were talking about trade
20:40
deals earlier and that. And when you had last week in
20:44
Washington was the IMF had all these delegations all whispering
20:48
to each other. Who have you sat down with?
20:51
Did you get Besson? Did you get Lucknick?
20:54
Who were you talking to? Everyone was there were all
20:57
these rude jokes about Pete Navarro being locked in a room
21:01
somewhere so that the adults could come out.
21:04
But I think the interesting thing there is that 200
21:08
countries coming to you to make deals.
21:11
We know that trade deals are notoriously complicated.
21:15
The idea that you could service 200 trade deals concurrently is,
21:21
is, is just, you know, for the birds really.
21:25
And so when you, when you talk to different countries or own,
21:30
for example, they're not, they think they're front of the
21:34
queue. And it's not because there is a
21:36
a process with negotiators in place, it's because they're just
21:40
getting a bit of FaceTime so. Let me ask you a question.
21:44
Hey there. Let me ask you a question
21:45
because this is something I really, you know, haven't seen.
21:47
And I wonder why it hasn't occurred.
21:49
And it's the following, the reason why these American
21:53
companies have gone to China or Indonesia or Vietnam to make
21:56
their Nike sneakers. It's because it's cheap there,
21:59
but they've not really been taken to task by the
22:02
administration. It's the, it's the country's
22:04
fault where the cheap labour is taking place, not the American
22:07
companies fault that have outsourced their jobs to that
22:10
country. And by the same token, if you're
22:12
going to bring back jobs to the Rust Belt, you know, old style,
22:16
you know, 20th century manufacturing jobs, who's to say
22:20
that those jobs won't be done by robots because those companies
22:24
aren't going to have to try and cut their margins, right?
22:27
So, I mean, I none of that makes sense to me.
22:29
And that part of the discussion has simply been absent from the
22:33
stage. Why is that?
22:34
I mean, there's that great quote on, on Liberation Day where
22:37
Lotnik is saying, you know, people are going to come back
22:40
and, you know, lots of Americans are going to be doing these jobs
22:43
with bolts. And then he, he, it's put to
22:46
him, well, hang on, aren't these, all these companies going
22:48
to come back and, you know, Autumnise and it's going to be
22:52
machines. And he's like, Oh, well, no, I
22:53
guess we'll be mechanics. I mean, we, we've just been in
22:56
the Deep South kind of talking. You know, Louisiana's an
22:59
industrial state. You've got a place that
23:02
companies like Hyundai promising to build a $6 billion steel
23:07
plant there. They're not alone, by the way.
23:09
There's a whole bunch of companies that are promising to
23:12
build new factories to service the auto industry there and
23:18
people are very excited about it.
23:19
But is it going to mean more jobs?
23:22
Is it really going to bring? And what kind of jobs are you
23:25
talking about? Because as he said, you know,
23:28
companies that are going to put in CapEx in order to reassure
23:34
these are 10 year programs, these are 15 year programs,
23:38
they're going to have the latest technology and the latest
23:41
technology is not a kind of labour intensive situation.
23:46
So it, it's very interesting, you know, but but people
23:51
believe, you know, that's the thing you have to remember on,
23:55
on, on the Bayou, we talked to shrimpers.
23:58
They've seen their industry kind of decimated because of cheaper
24:02
imports coming in from India, from Indonesia, from Ecuador.
24:07
And, and they believe they're like, that's our guy, that's
24:10
Donald Trump. He's going to bring shrimping
24:12
back. As I said earlier, there's so
24:14
much to discuss in the relatively short time available
24:17
and we haven't even looked at the kind of, you know, the the
24:20
rest of the planet and how they might respond or not to the 1st
24:24
100 days of Donald Trump. So let's go back to Lindsay and
24:26
quite and in fairly swift order kind of move around the globe.
24:30
So the rather like Steve Witkoff, you know, the envoy to
24:33
just about everywhere who's fitting between Paris and Moscow
24:38
and and the Middle East to try and, you know, get some sort of
24:41
war, some sort of peace settlement in Ukraine.
24:44
So when Ukraine, where are we? You know, he obviously hasn't
24:48
achieved peace in 24 hours. Are we any closer to it 100 days
24:51
down the line? We don't know because it keeps
24:55
going backwards and forwards. So there is now a peace proposal
24:59
from the Americans and there is a counter proposal from the
25:03
Europeans. But there hasn't actually been
25:06
any negotiation. Nobody has sat down as in
25:09
diplomats with the Ukrainians here and the Russians here and
25:13
talked to both sides and, you know, done that shuttle
25:17
diplomacy between the two of them or even, you know, nowhere
25:20
near having the two sides talking to each other.
25:23
And So what that means is that there's any amount of room for
25:28
misunderstanding and misinterpretation and deciding
25:31
that things are your way, not the other way.
25:33
The Ukrainians have agreed to a 30 day ceasefire, the Russians
25:37
haven't. Then they've said they'll do a
25:39
three day ceasefire starting next week.
25:41
But one of the things that is very clear is that the Russians
25:45
are upping the ante in terms of firing ballistic missiles into
25:50
civilian areas. We saw probably the the harshest
25:55
attack on the capital, Kiev, that was just a few days ago,
25:59
and another very hard attack on a place called Sumi in the
26:02
north. So the Russians are definitely
26:05
not doing anything to dial this, dial this down.
26:08
And Trump has said, oh, that he's might be a bit unhappy with
26:13
with President Putin. Maybe he's just tapping me
26:15
along. He said that interestingly,
26:18
after that huddle with President Zelensky in the Vatican.
26:23
But you know, that's what he said this week.
26:25
Who what's he going to say next week?
26:27
And maybe he's going to walk away.
26:28
And if he walks away, which is what he has threatened, and
26:32
stops the intelligence sharing and stops providing ammunition
26:37
for the Patriot anti aircraft missile batteries, then that
26:41
leaves Ukraine extremely vulnerable.
26:44
But also, there's a theme here, isn't there, Lindsay, in the way
26:47
that he's done the tariffs, in the way that he's doing, you
26:50
know, into, you know, geopolitics and diplomacy.
26:54
He makes it up as he goes along. He wants the quick and easy, you
26:58
know, hit of, you know, peace in Ukraine in 24 hours, you know,
27:03
turn Gaza into Mar a Lago on the Med, you know, tariffs will get
27:07
the Chinese in line. And then he he realizes that
27:11
reality is just a little bit more complicated than that.
27:13
And then he ends up having to row back.
27:15
And So what we're left with, whether it's tariffs or indeed
27:17
geopolitics is an incredibly fragmented and messy field.
27:21
So let's let's move through the field.
27:23
Gaza. He came up with this crazy idea
27:26
of turning Gaza into a kind of Club Med, removing 2 point 2.1
27:31
million people forcibly to Jordan and Egypt.
27:34
That idea hasn't been mentioned now in at least 60 days,
27:38
presumably because it's not going to work.
27:40
It was just nonsense. Yeah, but what he has done is
27:44
give Prime Minister Netanyahu carte blanche.
27:48
And So what we have at the moment is a situation where no
27:51
aid is getting into Gaza. The Israelis have stopped it all
27:55
that you have once again children on the brink of
27:57
starvation and you have an you have intense bombardment and the
28:03
people of Gaza are living through hell.
28:06
And there is absolutely no restraint on this Israeli
28:09
government. This Israeli government where
28:12
some of its own officials, the head of Shin Bet, many others
28:16
were against what Netanyahu is doing now.
28:19
Netanyahu is doing plays to the far right in his own coalition.
28:23
It does not play even to the majority of Israelis and to more
28:29
responsible elements. And yet President Trump is
28:32
enabling this. And where that ends, I don't
28:35
know. But it is absolutely disastrous
28:38
for the people of Gaza. It's also disastrous for
28:41
President Trump's own desire to have very close relationship
28:46
with Saudi Arabia and other Gulf countries because there is no
28:49
way that those countries with their populations, which are
28:53
very pro Palestinian can get have any kind of deal with
28:57
Israel and and can come much closer to to Trump.
29:02
And of course, the the weird thing about the fact that he
29:05
allowed the Israelis to break the ceasefire is that they broke
29:08
a ceasefire deal that he himself, through Steve Witkoff,
29:12
helped to negotiate just before, you know, he took office.
29:16
So I mean, it's very strange that he's done this and I what
29:20
is, do you think, his bigger vision for the Middle East,
29:24
especially when it comes to Iran, which of course is another
29:26
thing that he's brought into the equation?
29:28
Yeah, absolutely. And of course, there was an
29:31
agreement with Iran called the JCPOA, which he pulled out of in
29:37
his first term of office. Now he wants to negotiate with
29:41
Iran about its nuclear programme in a situation which is very
29:45
different because at that point, Iran had not enriched uranium to
29:50
a very high degree. But now Iran is believed to have
29:54
enriched uranium up to the point where it is, you know, it's a
29:58
threshold state. It could build a bomb.
30:00
It says it doesn't want to. Now, the diplomacy here, it does
30:05
involve Steve Witkoff. Of course it does.
30:07
It does seem a little bit more organised and mature.
30:10
It's happening in Muscat, in Oman.
30:11
And there do seem to be diplomats involved.
30:14
And Iran is in a much weaker position in the sense that it
30:17
has lost Hezbollah, Hamas as well, and, you know, and also
30:24
obviously President Assad in Syria.
30:25
So Iran is in a weaker situation, but it has better
30:29
relations with those Gulf countries.
30:31
So again, it's 3 dimensional chess.
30:34
I don't think President Trump plays one-dimensional tress,
30:39
never mind the kind of complex games that they play in the
30:43
Middle East, where they are far more subtle and clever and
30:48
historic and in complex than I think President Trump could ever
30:53
dream of being. As someone said, he doesn't play
30:56
any kind of chess, he plays Chequers.
30:59
And maybe that's what we're seeing in the moment.
31:00
OK, so let's try and look ahead to the next 100 days or maybe as
31:04
the economist put it on their front cover, the next 1247 days,
31:08
which is what we have left of the Trump presidency.
31:11
It seems like an awfully long time when you consider how much
31:14
has been done in the 1st 100. So, Helia, to you, I mean, both
31:18
the domestic economy, you know what those big Titans of social
31:22
media and industry are going to be doing.
31:24
We know that Elon Musk, for instance, is weaning himself off
31:28
Dodge and government and spending more time with his
31:30
Tesla family because the share price.
31:32
Is time. Or is he being?
31:34
Kicked out. Well, I think it's a, I think I
31:37
wouldn't be surprised if it's a, if it's the, the former rather
31:40
than the latter, actually. I mean, that's, it's a good
31:42
question. I'm not sure if he is being
31:44
kicked out because I think Trump does have, you know, Trump
31:47
hasn't got that many close friends.
31:49
And I think there is a kind of bond there.
31:50
I'm told there is a genuine bond between those two.
31:53
But at the end of the day, money is speaks very, you know, very
31:56
vocally. And when you see, you know, But
31:59
the thing he's known for after all, is Tesla.
32:01
And when Tesla's share price tanks, when their sales are down
32:04
50% in Europe and China and and down whatever 30% here in the
32:08
US, that's not good news for Trump.
32:10
And he would hate to use the label of being the the world's
32:13
richest man. Perhaps he already has.
32:15
But so give us some idea of what you will focus on in the next
32:18
100 days. I think it's a, it's a matter
32:21
of, you know what, what, what plays out.
32:24
You know, Lindsay was talking just a few moments ago about the
32:28
pause, the tariff pause, 90 days.
32:31
There was lots of talk last week.
32:32
Is it going to be more than that?
32:33
Will it end up being 180 days? There's a lot of kind of
32:38
delusion, I think, with people who are hoping that this will
32:43
all be rolled back. Do not underestimate what
32:46
happened at the beginning of last week.
32:48
That's when President Trump went, started the week by
32:52
talking about he wanted to kick out the head of the Fed.
32:55
And you saw these wild market movements and he was really
33:00
reined in. There was lots of chat, you
33:03
know, in the corridors of power in Washington about how far
33:08
Trump had been reined in, that there had been a limit put on
33:12
his ideas about tariffs. You said he's making it up on
33:15
the hoof. No, on tariffs.
33:17
He's an ideologue. He believes in this.
33:20
Is it economically literate? I don't know.
33:23
Does it make sense? I don't know.
33:25
It's, it's seen as a boon, boon for the working class American
33:30
man. But will it deliver?
33:32
Well, that, I think is the question for the next 6 months
33:35
because at the moment you're going to see companies are
33:38
pausing that are thinking about is this going to raise prices?
33:42
Is this going to cut demand? Are we going to see a recession?
33:46
And a lot of economists still are projecting A recession just
33:50
on the borderline. And that is based I think this
33:53
is the critical thing economists are forecasting in some cases
33:57
recessions based on the fact that they think that he's going
34:01
to row back from these policies that the kind of the tariffs are
34:05
never going to happen. It's never Neverland.
34:07
It's you know, it's slightly Kierkegaard that you have to
34:10
suspend belief. You, you you believe that that
34:14
it's all going to be OK in in the end, even though the
34:18
president is coming out and saying crazy things about
34:21
tariffs being the best world in the English Dictionary.
34:24
So I think the critical thing from an economic perspective is
34:28
how far will he go? Will these deals actually
34:31
materialise? Is there is there anything to
34:34
talk about? Will it come out with it's just
34:37
a negotiating ploy. We're not going to make this 700
34:40
and something billion dollars as revenue.
34:42
We're actually going to use it to to think about supply chains,
34:47
to think about bringing back some farmers so that we don't
34:50
rely so heavily on India and China for our penicillin or our
34:55
vitamin B or our magnesium. We're going to bring it fall
34:58
back, we're going to bring investment and it's going to
35:01
create some kind of rebalancing I think.
35:05
But also, there's this, there's this amazing.
35:07
I mean, and he's been talking about tariffs since the 1980s,
35:10
since anyone cared to listen to Donald Trump.
35:12
But actually, what? I have yet to meet an economist
35:15
in this city or anywhere else who understands the mathematics
35:19
behind his calculations. There's one.
35:21
It's Pete. Well, Peter Nevada.
35:23
Peter Nevada. Yeah, but.
35:24
Economist. But he's the, he's the one guy,
35:27
exactly. And he's the at the moment.
35:28
He's very quiet at the moment and I think that tells you all
35:32
he's moved. He's moved to an island of
35:35
Penguins. I think they've they've welcomed
35:38
him there. But but the other thing is that,
35:40
you know, I mean, we know that these, you know, executives are
35:44
getting much more vocal in their opposition to Trump's chaotic
35:47
trade and economic policy. And one of the things that, you
35:50
know, he's going to really watch out for in the next 100 days is
35:53
that he's promising the American public massive tax cuts in this
35:57
budget that is being prepared on Capitol Hill right now.
36:00
But he's saying that these tax cuts will be paid for by the 700
36:04
billion of, you know, of revenue that comes in from tariffs.
36:07
Well, hang on a minute. You know, even I understand
36:10
this. And I'm practically enumerate.
36:11
If you don't trade with America anymore because there are too
36:15
many tariff walls, then the volume of money that you can tax
36:19
with a tariff goes down exponentially.
36:21
And that money is missing from your calculation.
36:25
What's Is there a solution to that problem?
36:27
Do they even know they have a problem?
36:29
No, I mean, I, I, I think you're right.
36:31
The mathematics is slightly questionable, especially given
36:34
although you have the 10% baseline tariffs.
36:37
You know, at one point Donald Trump was talking about there's
36:40
already revenue coming in. It's already happening.
36:44
It's highly dubious because a lot of the tariffs that they've
36:47
been talking about are on pause, as he said, because all of these
36:50
countries are coming to kiss the ring.
36:53
I think the budget will be a big, you know, the big mega
36:56
bill, the best bill in the world, as he would say it is a
36:59
big deal because a lot of the fiscal Hawks actually are not
37:03
very keen on it. He's talking about rolling over
37:07
about four, you know, trillion of tax cuts, but that depends in
37:13
part on other departments cutting their spending.
37:18
And that is going to be a very difficult process.
37:20
So I think you've got one is, is the economics of corporate
37:24
paralysis. Are you going to start to see
37:27
that in the data in, in terms of having a recessionary or a
37:32
growth impact? Are you going to see prices go
37:35
up? And how do consumers respond to
37:37
that? And are they going to get this
37:39
mega? Remember that the US has $36
37:43
trillion worth of debt. It is a mountain of debt, and
37:48
that is in part what he says he's trying to rebalance the
37:52
global economy for. But a lot of what he's doing
37:55
could end up making that gold card, you know, a lot more
38:00
complicated. Lindsay, final word to you again
38:03
looking at to the next 100 days and perhaps we may have to look
38:07
a bit further beyond that. Is it at all possible that at
38:10
the end of this period, Donald Trump will will be the kind of
38:13
peacemaker who did bring about a viable peace in Ukraine with a
38:19
sovereign, independent Ukrainian nation state, albeit somewhat
38:23
smaller than it was in 2013? Or is that just pie in the sky?
38:29
Look, nothing is impossible, and you also have the law of
38:31
unintended consequences. So one of the effects of all
38:36
this international financial and economic chaos is that the price
38:40
of oil has come right down. And that is what sustains Putin
38:45
because Russia is entirely dependent on its oil exports,
38:50
which have and Iran sanctions and Iran is the same as well.
38:54
You're right. So what that could mean is that
38:58
if the if Russia is considerably weakened by that and if this
39:03
current draft, which the Americans have sticks and, you
39:07
know, makes way for some negotiations, it OK, It says
39:11
that America will recognise that Crimea is part of Russia, but it
39:15
doesn't say that Ukraine has to recognise that.
39:17
And it also doesn't put any limit on Ukraine building up its
39:23
armed forces. So Ukraine could have what's
39:26
called a hedgehog strategy or a porcupine strategy where it
39:30
becomes so reinforced and so militarily strong that a
39:35
weakened Russia, which isn't getting money from oil, not so
39:38
much anymore, doesn't dare attack again.
39:41
So look as if, if, if, if along that line.
39:45
But so that is possible. But I think that what you're
39:48
also going to get is, is just this continued sense of
39:53
instability and not knowing where America is.
39:56
Because it's a strange thing that Donald Trump came in saying
40:01
that people didn't used to America had become a laughing
40:04
stock and he was going to make America respected again.
40:07
Exactly the opposite has happened.
40:10
So if you take somewhere like Sudan, the war in Sudan, OK, the
40:13
Biden administration didn't do much.
40:16
But traditionally the Americans, when there have been wars in
40:19
Sudan and there have been many, have played a leadership role.
40:22
They have done something, They have done something about the
40:24
humanitarian situation. They have done something about
40:27
bringing warring parties together and bringing an end to
40:31
these kind of wars. They under Donald Trump, they
40:34
don't even know those wars are going on.
40:36
They have no interest in that. So I think you're going to see a
40:40
massive amount of humanitarian suffering because of that.
40:43
And let's not forget the destruction, the performative
40:46
cruelty of destroying USAID. I was going to mention that.
40:50
Yeah, that. So that is two things.
40:52
One is it did sustain people, many people who had HIV in
40:57
Africa, who were getting antiretrovirals, drugs for HIV,
41:01
AIDS, they were getting that through American programs.
41:05
But also that was a very large part of America's soft power.
41:10
What made countries, yes, respect or even like America?
41:15
President Trump has done exactly the opposite.
41:19
He has made people hate, resent, fear and worry about America.
41:25
And I think that in the next 100 or 1000 plus days, we're going
41:29
to see how people respond to that.
41:32
Do they respond by electing people like Mark Carney who say
41:36
they're going to stand up to that and looking to policies
41:40
like that of Xi Jinping, who says, you know, we are strong
41:43
enough, we are China, we are going to, we will not be cowed,
41:46
we will not be bullied. But those countries are strong
41:51
enough to do that. What about all of the much
41:54
poorer countries who do not have that option?
41:57
I fear an enormous amount of suffering in the days and months
42:01
to come. I couldn't agree more.
42:02
I think we're into a a new, very chaotic, unpredictable world
42:07
disorder. And the big event here is not,
42:11
you know, existing wars or natural disasters.
42:13
The big event is Trump himself. Anyway.
42:16
Lindsay Hilsum, our international editor, Helia
42:18
Ibrahimi, our economics correspondent, Thank you very
42:20
much to you both. That is it for this edition of
42:23
The Forecast from Washington.