Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: The US presidential election is one day away and on Tuesday,
Speaker 2: as tens of millions of Americans head to the polls,
Speaker 2: there's a general sense of unease around the world as
Speaker 2: global leaders brace themselves for the uncertainty of what comes next.
Speaker 1: There was always a sort of a sense, at least
Speaker 1: in the West, that as long as the US got
Speaker 1: it right, the world order would be okay. And I
Speaker 1: think what the likes of the UK and France and
Speaker 1: Italy and Germany have seen is that the process the
Speaker 1: elections have become increasingly unhinged.
Speaker 2: Flavia Kraus Jackson is an executive editor at Bloomberg who
Speaker 2: oversees our coverage of economics and politics in Europe, Africa,
Speaker 2: the Middle East, and Latin America, and in the run
Speaker 2: up to election day in the US, she gave an
Speaker 2: assignment to some of Bloomberg's twenty seven hundred reporters and
Speaker 2: analysts based all over the world.
Speaker 1: We really canvassed all the capitals from Brasilia via Dubai,
Speaker 1: Beijing by way of Berlin, etc. And we didn't want
Speaker 1: b role. We wanted them to speak to some of
Speaker 1: the smartest people in government speak openly or on background
Speaker 1: about how they were wargaming the scenarios.
Speaker 2: The scenarios being either a Kamala Harris presidency or another
Speaker 2: Donald Trump term. I'm David Gura, and this is the
Speaker 2: big take from Bloomberg News Today on the show the
Speaker 2: global stakes of the US election and how world leaders
Speaker 2: are bracing and preparing for the impact it'll have beyond
Speaker 2: America's borders. The next US president will come into office
Speaker 2: at a time when there are major conflicts taking place
Speaker 2: in several parts of the world. The war in Ukraine
Speaker 2: is well into its third year, there's concerned about a
Speaker 2: wider war in the Middle East, and tensions high between
Speaker 2: China and Taiwan. I began by asking Bloomberg's Flavia Kraus
Speaker 2: Jackson how the course of the Israel Hamas war could
Speaker 2: change depending on who wins the election, Kamala Harris or
Speaker 2: Donald Trump. She started with the vice president.
Speaker 1: Kamala Harris has something going for her, which is essentially
Speaker 1: the kind of credibility that comes also with who she's
Speaker 1: married to. She can speak to the Jewish community with
Speaker 1: a degree of authority, and she also brings a fresh perspective.
Speaker 1: She in her words, still believes in the two state solution,
Speaker 1: something that Natanyahu has essentially taken off the table. So
Speaker 1: the big challenge for her is how she translates that
Speaker 1: rhetoric into practice, because what we have actually seen to
Speaker 1: a degree, or at least how the Middle East perceives it,
Speaker 1: is that the US is having a bit of an
Speaker 1: emperor without close moment right they can't quite understand why
Speaker 1: the US is the biggest supplier to Israel and why
Speaker 1: it's incapable or unwilling to use this leverage. Now when
Speaker 1: it comes to Donald Trump, it's an entirely different scenario.
Speaker 1: He often likes to say that when he was president,
Speaker 1: there were no wars, and that just like he would
Speaker 1: in Ukraine, he would fix it overnight, Similarly he would
Speaker 1: do the same in the Middle East. And there has
Speaker 1: been some reporting out there that he is essentially told
Speaker 1: natanyahuould know on certain terms that he wants this conflict
Speaker 1: to end in January before he's sworn in, if indeed
Speaker 1: he is elected. So I think there there is a
Speaker 1: sense that the approach is much more transactional. Of course,
Speaker 1: he is seen to enjoy very good relations with the
Speaker 1: Gulf countries, specifically with MBS in Saudi Arabia. They want
Speaker 1: a deal, they want arms, and there's nothing that Donald
Speaker 1: Trump would like more than to be able to say
Speaker 1: that normalization happened under him.
Speaker 2: When it comes to Ukraine, as Flavia mentioned, Donald Trump
Speaker 2: has also said he would bring a speedy end to
Speaker 2: the war. There Limberg's conversations with officials around the globe,
Speaker 2: there's great concern that Trump will make good on his
Speaker 2: promise by pushing for a deal with Russia's president Vladimir Putin.
Speaker 1: It's very hard to predict how Ukraine will play out.
Speaker 1: So how do you appeal to Trump's transactional nature? And
Speaker 1: one idea that sort has been talented by some at
Speaker 1: NATO is to say, well, you know, mister president, if
Speaker 1: you do that, you will look weak in the eyes
Speaker 1: of China, and they might exploit it in a different way.
Speaker 1: You don't want to look weak next to Shishi Ping.
Speaker 1: So the strategy there is really to appeal to his
Speaker 1: sense of ego and the sense that he is standing
Speaker 1: head and shoulders above some of these other rivals. So
Speaker 1: that would be the playbook, if you will, of how
Speaker 1: to sort of deal with the potential that when he
Speaker 1: comes in. Putin has waited long enough pretending that he
Speaker 1: wants Harris to be in power. I think he's quite
Speaker 1: looking forward to having Trump. I mean they've clearly had
Speaker 1: a relationship. That much was made clear by the Bob
Speaker 1: Woodward book. So I think the big question is, come
Speaker 1: twenty twenty five, will Ukraine be sold up the river
Speaker 1: or not? And what can Europe do about it?
Speaker 2: And if Harris wins, it's not.
Speaker 1: Particularly promising for or it's pretty dispariting for Zelenski in
Speaker 1: the Harris scenario because it's quite clear that Woar fatigue
Speaker 1: has dug in right. So a few years ago, when
Speaker 1: Zelensky went to Washington, he was greeted as a war hero.
Speaker 1: Everyone in Congress was supportive that the money was flowing.
Speaker 1: It's just a lot harder three four years down the
Speaker 1: line to get Americans to care about a conflict that's
Speaker 1: far away from home.
Speaker 2: And to make that ask for money as well.
Speaker 1: And to ask for money. So she's going to have
Speaker 1: to guss it up with lots of pretty words. But
Speaker 1: I think the message, even though not as brutally delivered,
Speaker 1: will be the same. It'll be massaged in a certain way,
Speaker 1: but it'll be listen. Even the fifty billion asset that
Speaker 1: has been sort of put forward in terms of a loon,
Speaker 1: the well has run dry, and the pressure to bring
Speaker 1: Zelenskip to the negotiating table is big.
Speaker 2: So the third conflict I want to touch on is
Speaker 2: a potential conflict. So that's China and Taiwan. I imagine
Speaker 2: there's a lot of anxiety in Taipei about who wins
Speaker 2: this election. We've kind of gotten a variety of answers
Speaker 2: for a President Trump about how he might approach Chinese
Speaker 2: invasion of the Taiwan. Do we have a clear sense
Speaker 2: of what he would do, how he would approach that
Speaker 2: potential conflict, and then how would a President Harris approach it.
Speaker 1: The one thing has become very clear both from Harris
Speaker 1: and Trump is that whilst they are essentially turning their
Speaker 1: back on other conflicts and prioritizing one thing, that thing
Speaker 1: is China, and that thing is containing its biggest economic rival.
Speaker 1: So the big question then becomes will the US come
Speaker 1: to Taiwan's defense should Taiwan come under attack? And there
Speaker 1: the answer also is uncertain because at the heart of
Speaker 1: all this is the world's chip making in this street
Speaker 1: Taiwan is sitting on something extremely valuable that everyone wants
Speaker 1: a piece of. It's obviously not able to defend itself,
Speaker 1: and the question then becomes to what extent either side
Speaker 1: would get itself involved militarily. And we're looking at a
Speaker 1: scenario that may honestly be decades from actually materializing, and
Speaker 1: so a lot of what you're going to see is
Speaker 1: posturing and everyone trying to sort of unpick different sides.
Speaker 1: A lot of this is going to play out in
Speaker 1: the South China see, So to what extent China can
Speaker 1: lay claim and essentially bully its way in those waters,
Speaker 1: neutralizing and pushing back all sorts of rival claims from
Speaker 1: the likes of Vietnam, Philippines, etc. So it's a slow process,
Speaker 1: and even though the US keeps exercising its right of passage,
Speaker 1: the direction of travel there is that China is increasingly
Speaker 1: on the screws.
Speaker 2: Bloomberg analysts recently forecasted what the fallout could be if
Speaker 2: China were to assume full control of Taiwan and Flavia says.
Speaker 2: They concluded it would be disastrous for the global economy
Speaker 2: after the break. So what would it cost to implement
Speaker 2: Donald Trump's plan to deport eleven million undocumented immigrants from
Speaker 2: the US, and what about those giant tariffs he's promising.
Speaker 2: We'll talk about what those plans could cost the US
Speaker 2: and the rest of the world. One of the biggest
Speaker 2: issues in the US presidential campaign has been immigration, and
Speaker 2: the platform is put forward by former President Trump and
Speaker 2: Vice President Harris stand In. Stark contrast, Bloomberg's Flavia kraus
Speaker 2: Jackson says, the policies the next president puts in place
Speaker 2: will have massive implications.
Speaker 1: There is the sort of the politics of it that
Speaker 1: are indistinguishable to degree from the economics. And I think
Speaker 1: when Trump calls for the deportation of eleven million undocumented
Speaker 1: immigrants and talks about creating the tension camps and deploying
Speaker 1: troops at the Mexican border, what is lost in all
Speaker 1: this is that this is extremely expensive.
Speaker 2: According to Bloomberg Economics, if Donald Trump were to carry
Speaker 2: out that plan, if you were to reduce the flow
Speaker 2: of new immigrants to close to zero and deport those
Speaker 2: who have arrived since twenty twenty, that would put a
Speaker 2: three percent hole in US GDP by twenty twenty eight.
Speaker 2: But what about Kamala Harris's plans. Bloomberg Economics also took
Speaker 2: a close look at what she's proposed.
Speaker 1: Harris, however, has been kind of advocating for title limits
Speaker 1: and undocumented inmigration and restrictions. But by blooming Economics calculations,
Speaker 1: that would be a lot less expensive. I mean. The
Speaker 1: other thing that's also, of course getting lost in this
Speaker 1: is that is the remittances. Right, So when there are
Speaker 1: people in the US earning money, the money that's being
Speaker 1: earned is going back to the country.
Speaker 2: They're sending it at home.
Speaker 1: They're sending it back home. Yeah, that has a net
Speaker 1: positive effect.
Speaker 2: Something else world leaders are gaming out is how the
Speaker 2: winner of the US presidential election would reshape trade. Former
Speaker 2: President Trump has pledged to impose more highly punitive tariffs,
Speaker 2: which he says would compel companies that have moved operations
Speaker 2: overseas to come back to the US.
Speaker 1: If he follows through on his promise of sixty percent
Speaker 1: tariffs on China and twenty percent on everyone else, that's
Speaker 1: a game changer. So here, what the figures are, and
Speaker 1: they're startling, is that our model shows that the US
Speaker 1: share of global trade would create it to eight point
Speaker 1: five percent by twenty twenty eight from the current twenty percent,
Speaker 1: and that would have a knock on effect on Mexico
Speaker 1: and Canada. But world leaders and diplomats have sort of
Speaker 1: really stopped trying to sort of reason with Trump about
Speaker 1: the economics of tariffs, trying to sort of convince them
Speaker 1: they're not good days by conflation. So we're passing on
Speaker 1: that pas to consumers. You know, just because you erect
Speaker 1: these tariffs, you don't necessarily change behavior of a night.
Speaker 1: He's just not buying those arguments. And if you can't
Speaker 1: convince someone, then the question is adapting right. Racing for
Speaker 1: impact is going to be ugly. No one comes out
Speaker 1: of a winner in trade wars. But at least this time, Europe,
Speaker 1: at least, which is kind of getting squeezed between China
Speaker 1: and the US and feeling like it has to pick sides,
Speaker 1: has at least something to show for it and can
Speaker 1: respond in kind love.
Speaker 2: You talked about how a lot of high ranking officials
Speaker 2: world leaders look at Kamala Harrison feel like they don't
Speaker 2: know her policy positions. Well, when it comes to foreign affairs,
Speaker 2: do we know much about what would happen to trade
Speaker 2: if she were to be elected president? Is the assumption
Speaker 2: that it would be kind of status quo, a good one.
Speaker 1: I think that would be correct. I mean, where Kamala
Speaker 1: Harris really shines and comes alive is when she talks
Speaker 1: about social issues, when she talks about abortion, when she
Speaker 1: talks about social justice, when she's able to draw on
Speaker 1: her background as a prosecutor, when she's able to talk
Speaker 1: about the legality or illegality of Trump's actions. But you know,
Speaker 1: when it comes to tariffs, I mean, she's essentially supported
Speaker 1: the Biden administration's decision to extend those Trump era tariffs
Speaker 1: on China. She backs you know, the tens of billions
Speaker 1: and subsidies for clean energy and infrastructure, and she's embraced
Speaker 1: some trade deals. But this is by no means her
Speaker 1: area of expertise. So I think we would have to
Speaker 1: expect her to sort of really be delegating that to.
Speaker 2: Others as government officials worldwide wait for the outcome of
Speaker 2: Tuesday's vote. No matter who the winner is, Flavia says,
Speaker 2: one thing is clear that the United States is standing
Speaker 2: has changed in recent years.
Speaker 1: Think if I was to pull back the lens generationally,
Speaker 1: I would go back to a time both in the
Speaker 1: immediate post war. If you go to countries like Germany
Speaker 1: and Italy and the UK, there was a depth of
Speaker 1: gratitude for America's role and essentially saving Europe from the Nazis,
Speaker 1: and there was a sort of embrace of everything that
Speaker 1: was American culture, and that kind of spawned an economic
Speaker 1: revival in momenty of these countries and enthusiasm for American literature, culture, wealth, fashion,
Speaker 1: and everything. And then Europe and the rest of the
Speaker 1: world fell out of love with the US and what
Speaker 1: it represented because it no longer represented these good values.
Speaker 1: What emerged from the wars in Iraq, for example, was oh,
Speaker 1: the US lies or it medals in other countries. It
Speaker 1: doesn't like a leader in a certain country, it will
Speaker 1: get involved and depose them. And so the narrative around
Speaker 1: the US started changing. There was a sense of like,
Speaker 1: hold on a second, we're getting scolded and America's wagging
Speaker 1: its finger at us. But they also do bad things
Speaker 1: and we can point to those bad things. So somewhere
Speaker 1: over those decades, the US lost its moral high ground.
Speaker 2: Flavia says, a British diplomat who spoke with Bloomberg, put
Speaker 2: it succinctly.
Speaker 1: He made this parallel that empires rise and fall. They
Speaker 1: don't suddenly collapse overnight. It's a long process, it's a
Speaker 1: managed process. And so I think the long view is
Speaker 1: that America is still a very important, potent superpower. But
Speaker 1: what all comes down to is whether it will manage
Speaker 1: its decline in an elegant fashion or whether it will
Speaker 1: sort of go down and flames.
Speaker 2: This is the Big Take from Bloomberg News. I'm David Gura.
Speaker 2: This episode was produced by David Fox and Adriana Tapia.
Speaker 2: It was edited by Caitlin Kenny and Greg White. This
Speaker 2: episode was mixed by Alex Sagura. It was fact checked
Speaker 2: by Andreana Tapia. Special thanks to Saks Shimoneses, Young Young,
Speaker 2: Dan Williams, and Maya Avrebuk. Our senior producer is Naomi Shaven.
Speaker 2: Our senior editor is Elizabeth Ponso. Our executive producer is
Speaker 2: Nicole Beemster Bor Sage Bauman is Bloomberg's head of Podcasts.
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