WEBVTT - Surveillance: 2020 Is A Tipping Point, Eurasia's Bremmer Says 0:00:09.880 --> 0:00:13.800 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane Jay Lee. 0:00:13.960 --> 0:00:17.560 We bring you insight from the best in economics, finance, investment, 0:00:18.000 --> 0:00:23.480 and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud, 0:00:23.600 --> 0:00:27.520 Bloomberg dot Com, and of course on the Bloomberg. This 0:00:27.560 --> 0:00:30.080 is a real treat. We welcome all of you worldwide 0:00:30.080 --> 0:00:33.839 and across the nation to a conversation with Ian Bremer. 0:00:33.920 --> 0:00:37.159 Let me explain here right now out of telaying. Dr 0:00:37.520 --> 0:00:41.400 Bremer has built a franchise over a well decade with 0:00:41.600 --> 0:00:45.120 Eurasia Group. And what he's done like any lead singer 0:00:45.280 --> 0:00:47.559 running a good band, and to be sure, everybody in 0:00:47.560 --> 0:00:49.760 the band is better than him. And he has put 0:00:49.800 --> 0:00:53.479 together an outstanding team at Eurasia Group over the years 0:00:53.600 --> 0:00:56.600 of true experts. So let's dive in with Ian Bremer 0:00:56.640 --> 0:00:59.240 with the top risk of You had to rip up 0:00:59.280 --> 0:01:02.840 the script of risk here and rewrite it on Friday 0:01:02.840 --> 0:01:05.960 and Saturday. Where does iraq a ran all of these 0:01:05.959 --> 0:01:09.680 tensions fit in to the global risks of this year. Oh, 0:01:09.720 --> 0:01:11.919 we had to include it, certainly. But let's be clear, 0:01:12.040 --> 0:01:15.480 when you look at the big trends out there is 0:01:15.520 --> 0:01:18.720 a tipping point and that's true because an economy that's 0:01:18.720 --> 0:01:22.760 been growing robustly after financial crisis is now starting to 0:01:22.800 --> 0:01:30.720 get softer, a geopolitical recession is in serious uh capacity 0:01:30.840 --> 0:01:34.400 right now, and that the alignment between the United States 0:01:34.440 --> 0:01:38.240 and its allies is vastly weaker than it used to be. Globalization, 0:01:38.400 --> 0:01:41.160 which is the one thing that had driven so much 0:01:41.200 --> 0:01:45.360 of the good news um, is now taking a significant 0:01:45.400 --> 0:01:48.800 step backwards as the United States and China decouples from 0:01:48.840 --> 0:01:52.520 each other on the technology front. Those three things coming 0:01:52.560 --> 0:01:56.760 together is frankly an unprecedented stead of trends over the 0:01:56.760 --> 0:01:59.520 course of the last few generations. And it does mean 0:01:59.560 --> 0:02:03.560 that even though we don't believe that Iran war is 0:02:03.680 --> 0:02:07.760 going to suddenly lead to regional confrontation or World War three, 0:02:08.120 --> 0:02:11.120 we do believe that the Resilian's globally is so much less. 0:02:11.240 --> 0:02:13.400 You sat down today, inn and you said to me, 0:02:13.560 --> 0:02:15.720 I just want to get away from the hysteria. I've 0:02:15.760 --> 0:02:18.520 been doing that all weekend. You know. It's like excepter 0:02:18.600 --> 0:02:22.119 Neil Ferguson's wonderful essay in the Times of London, Time 0:02:22.200 --> 0:02:26.079 Freedman writing and others about some of the historical perspective. 0:02:26.400 --> 0:02:29.880 If we're to get away from the hysteria and get 0:02:29.919 --> 0:02:34.000 towards clear thinking on these immediate matters. What is the 0:02:34.120 --> 0:02:38.280 clear thinking as we look at Tehran, Baghdad in Washington, 0:02:38.600 --> 0:02:41.080 clear thinking is that the United States is likely to 0:02:41.120 --> 0:02:44.400 be forced out of Iraq. It's troop presence, which Trump 0:02:44.480 --> 0:02:47.079 didn't want to have to begin with, but nonetheless not 0:02:47.200 --> 0:02:49.760 because of the United States, because of Iran, and because 0:02:49.760 --> 0:02:53.160 the Shia, who are the majority in Iraq, um are 0:02:53.200 --> 0:02:56.359 going to turn very significantly against the United States following 0:02:56.639 --> 0:02:59.560 the series of bombings that you've seen um without any 0:02:59.639 --> 0:03:03.240 premi from the Iraqi government invasion of their sovereignty. Having 0:03:03.280 --> 0:03:06.360 said that, the power asymmetry between the United States and 0:03:06.360 --> 0:03:11.000 Iran is massive. If the Iranians were to actually engage 0:03:11.000 --> 0:03:15.040 in serious strikes against Americans in the region, they do 0:03:15.200 --> 0:03:18.000 risk their regime. And that's very different from the risk 0:03:18.040 --> 0:03:21.200 they thought they were taking when they went after a 0:03:21.280 --> 0:03:23.880 US base in the last week, or when they went 0:03:24.000 --> 0:03:27.120 after the U. S embassy in terms of the recent demonstrations, violence, 0:03:27.120 --> 0:03:30.320 and occupation. So there now is a level of deterrence. 0:03:30.560 --> 0:03:35.000 Trump is certainly enormously unpredictable, not very experienced leader from 0:03:35.000 --> 0:03:37.720 a foreign policy perspective. That's different from saying that our 0:03:37.800 --> 0:03:41.160 expectation is US Iran war. We don't think that's gonna happen. 0:03:41.400 --> 0:03:43.200 There's so many ways to go, your folks, and I 0:03:43.240 --> 0:03:45.480 think what I'll do is start with the immediate newsflow 0:03:45.560 --> 0:03:47.960 as you wake up across the nation, and one of 0:03:47.960 --> 0:03:51.680 them is to see the House Foreign Affairs Committee say 0:03:51.720 --> 0:03:53.880 on the back end of I believe it was a tweet. 0:03:54.280 --> 0:03:57.920 Mr Trump, you are not a dictator. Interpret force what 0:03:58.040 --> 0:04:02.280 your raisor group says about this Warpowers Act, how we've 0:04:02.320 --> 0:04:05.960 come out of the fractions seventies, the legacy of Vietnam, 0:04:06.320 --> 0:04:10.120 and now Congress in the executive branch should work with 0:04:10.240 --> 0:04:13.520 each other given these tensions. Most should and will are 0:04:13.560 --> 0:04:16.159 two different things. Let's be very clear, um. I think 0:04:16.200 --> 0:04:21.800 that if Maddis, McMaster, h Kelly, if they were still 0:04:21.800 --> 0:04:24.240 in the administration, I don't think Sulimani would have been killed. 0:04:24.800 --> 0:04:29.080 I think the constraints on Trump the adults in the 0:04:29.200 --> 0:04:33.240 room are not what they were. Pompeo is very smart, 0:04:33.320 --> 0:04:37.080 but facilitates Trump, and he's about to leave office and 0:04:37.200 --> 0:04:40.040 run for Senate in Kansas in any case, so I 0:04:40.080 --> 0:04:42.600 do think that that is a concern, and it's a 0:04:42.600 --> 0:04:45.599 concern that is rightly brought up by Congress. But the 0:04:45.680 --> 0:04:50.240 more important issue is that impeachment we are about to 0:04:50.360 --> 0:04:56.159 see is no longer functional as a political constraint on 0:04:56.279 --> 0:04:59.240 the president. And that's new. In other words, we're gonna 0:04:59.279 --> 0:05:01.560 have a guy running for office that will be acquitted 0:05:01.600 --> 0:05:06.120 by the Senate and he's going to have no no 0:05:06.279 --> 0:05:09.799 ability of others to say, if you take the following actions, 0:05:09.839 --> 0:05:12.000 you'll be removed from office. Only the people will be 0:05:12.040 --> 0:05:14.480 able to do that with the vote, and his efforts 0:05:14.839 --> 0:05:18.279 to manipulate and delegitimize that vote is going to be 0:05:18.360 --> 0:05:21.320 unprecedented in recent times. And I guess my question, Dr 0:05:21.360 --> 0:05:25.560 Bremer is synthesizing the Democrat candidate responses to what we're 0:05:25.560 --> 0:05:27.640 seeing in the last three days. But more than that, 0:05:27.880 --> 0:05:32.200 synthesize in the United States election into your top risks 0:05:32.200 --> 0:05:35.800 of For the first time in twenty three years, we 0:05:35.920 --> 0:05:39.600 view US domestic politics is actually the singular top risk, 0:05:39.680 --> 0:05:42.040 and we don't usually think about that because the US 0:05:42.160 --> 0:05:45.640 is so resilient, the political institutions are so strong. But 0:05:45.839 --> 0:05:48.400 here the concern is that we end up in an 0:05:48.440 --> 0:05:52.080 American Brexit, not because the US is leaving anything. But 0:05:52.320 --> 0:05:56.960 because the outcome of the election is seen as uncertain, 0:05:57.320 --> 0:06:00.479 is seen as contested and delegitimized. So it's not that 0:06:00.520 --> 0:06:02.080 you vote for Trump or that you vote for some 0:06:02.160 --> 0:06:05.440 Democratic candidate, but rather that whoever you vote for, half 0:06:05.480 --> 0:06:08.720 of the population believes that person should not have actually 0:06:08.800 --> 0:06:12.520 gotten the presidency. It's like core Bush, but without the 0:06:12.560 --> 0:06:16.400 Supreme Court concluding the outcome. And and and we haven't 0:06:16.400 --> 0:06:19.239 seen that since in teen seventy six in the United States, 0:06:19.480 --> 0:06:22.479 with the election of Rutherford Hayes. There's quite something to 0:06:22.520 --> 0:06:25.159 think about the world's largest economy going to have that 0:06:25.240 --> 0:06:28.440 kind of atturning point moment with our upcoming election. Let's 0:06:28.480 --> 0:06:30.120 let's move to some of the other risks that we 0:06:30.240 --> 0:06:32.240 see this year. I want to touch on a few 0:06:32.320 --> 0:06:35.680 here very quickly. On China, and of course you've been 0:06:35.720 --> 0:06:39.760 wonderful in China with your Meritith sumter um Ian Bremer's 0:06:39.800 --> 0:06:42.720 take on the next step of China not Phase two 0:06:42.760 --> 0:06:46.320 in the trade talks, but almost Phase G Trump. What's 0:06:46.360 --> 0:06:49.400 the next thing we should try to observe of these 0:06:49.400 --> 0:06:52.200 two world leaders. We should observe that China has changed 0:06:52.240 --> 0:06:54.640 a lot more than the United States, j and Pink's 0:06:54.640 --> 0:06:58.440 consolidation of power, his decision to make China into an 0:06:58.440 --> 0:07:02.640 ai superpower and to decouple itself from the United States, 0:07:02.680 --> 0:07:05.039 his belt and Road, his end of term limits, his 0:07:05.080 --> 0:07:08.599 anti corruption campaign. Those are the sea changes that we're seeing. 0:07:08.839 --> 0:07:13.080 The United States has it's only bipartisan consensus on foreign policy, 0:07:13.200 --> 0:07:15.960 is largely on a harder line response to the just 0:07:16.000 --> 0:07:17.840 because the timing. You know, I've got to get to this. 0:07:17.960 --> 0:07:20.080 You use the phrase a long march, which of course 0:07:20.080 --> 0:07:23.080 has all that color of another time in place in China. 0:07:23.200 --> 0:07:25.600 What does the new long march of China look like? Well, 0:07:25.720 --> 0:07:28.280 Jiji and Ping uses that phrase and that that phrase 0:07:28.480 --> 0:07:31.840 is about the Chinese not being able to be hit 0:07:31.960 --> 0:07:34.880 by the United States on critical issues of national security, 0:07:35.080 --> 0:07:38.320 most importantly their technology system. So it's building their own 0:07:38.320 --> 0:07:41.119 supply chain, having control of the countries that really matter. 0:07:41.320 --> 0:07:44.640 It's not needing the United States. That is decisively in 0:07:44.720 --> 0:07:47.800 opposition to everything that mattered to multinational corporations in the 0:07:47.800 --> 0:07:50.200 West for the last generations. We see the image of Tehran. 0:07:50.280 --> 0:07:52.120 We get out our map of a run like we 0:07:52.200 --> 0:07:54.960 got out our map of Iraq and two thousand three, 0:07:55.120 --> 0:07:58.480 Tehran's in a bowl. They have a lot of air pollution. 0:07:58.680 --> 0:08:01.560 We see the images of men the Indian cities with 0:08:01.680 --> 0:08:04.640 horrific air pollution as well, and that gets us the 0:08:04.720 --> 0:08:08.320 climate change. It's the vogue, but it's a different vogue 0:08:08.360 --> 0:08:10.720 this year. Climate change is different now than it was 0:08:10.800 --> 0:08:14.280 four years ago, isn't it. It's different because UM it's 0:08:14.360 --> 0:08:19.640 causing more domestic political response in backlash when the governments 0:08:19.640 --> 0:08:22.120 and the leaders aren't taking actions themselves to get to 0:08:22.120 --> 0:08:26.080 two degrees to point five degrees UM. The Chinese, the Indians, 0:08:26.120 --> 0:08:30.400 the Americans, nobody UM is on track UM to make 0:08:31.000 --> 0:08:33.360 their commitments. What that means is that you're going to 0:08:33.400 --> 0:08:37.440 start to see UM non organized responses like you have 0:08:37.520 --> 0:08:40.080 in the financial markets right now, and that's definitely changing 0:08:40.080 --> 0:08:43.480 how we think about UM. The multiples of shares in 0:08:44.200 --> 0:08:47.400 fossil fuels, for example, or the companies that are served 0:08:47.440 --> 0:08:49.520 by them, certainly going to change how we think about 0:08:49.520 --> 0:08:52.439 portfolio allocation. Let me circle back to what I've noticed 0:08:52.480 --> 0:08:54.800 since Friday. I've had to speak to adults in the room. 0:08:54.880 --> 0:08:57.960 James Travitas, the Atimal, mark him at the general time, 0:08:57.960 --> 0:09:01.800 Beckett of the United Kingdom Military, you as well, and 0:09:02.400 --> 0:09:06.280 in others. We're all trying to get to clear conversation 0:09:06.559 --> 0:09:11.120 in non hysteria over this. What should we listen for 0:09:11.240 --> 0:09:15.320 in the coming few days, is this unfolds Iraq irun 0:09:15.480 --> 0:09:19.600 in the United States. Let's watch what the Iranians do 0:09:19.800 --> 0:09:23.439 and don't say. It's very interesting that the Foreign Minister 0:09:23.640 --> 0:09:27.160 has focused on in the last twenty four hours leaving 0:09:27.160 --> 0:09:31.000 the nuclear deal but also saying they'll come back if 0:09:31.160 --> 0:09:34.720 the Europeans are able to continue to uphold and get 0:09:34.720 --> 0:09:38.640 them the sanctions off. They're focusing on um the uh 0:09:39.240 --> 0:09:43.320 Iraq uh pull out of the legislature, saying that the U. 0:09:43.440 --> 0:09:46.120 S troops should leave. If they're focusing on things that 0:09:46.200 --> 0:09:49.080 look like winds but aren't about we have to, you know, 0:09:49.120 --> 0:09:53.640 sort of kill American military. For me, so far, I'd 0:09:53.720 --> 0:09:57.440 actually say the diplomacy from Iran, not the demonstrations, but 0:09:57.480 --> 0:10:03.600 the diplomacy feels more climb down, feels softer rather than harder. 0:10:03.800 --> 0:10:06.520 There they are not in a position of power. If 0:10:06.520 --> 0:10:11.800 you're the world's only superpower, your room for miscalculation is greater. 0:10:12.040 --> 0:10:14.800 It gives me no pleasure to say that, but it's true, 0:10:14.800 --> 0:10:16.480 and the Iranians are highly aware of it. We're gonna 0:10:16.480 --> 0:10:18.280 have to wrap this up. Ian Bremer with us with 0:10:18.360 --> 0:10:20.760 your Asia group. Of course, many more conversations through the 0:10:20.800 --> 0:10:23.040 morning is well, and of course we'll look for this 0:10:23.080 --> 0:10:27.440 out on social particularly on Twitter and on LinkedIn as well. 0:10:27.559 --> 0:10:32.120 An important document the top risk from your Aisier group. 0:10:46.080 --> 0:10:48.360 Pharaoh is sick and he is going home. He maybe 0:10:48.440 --> 0:10:51.480 Yeoman's duty to come in earlier today and we hope 0:10:51.480 --> 0:10:54.240 that Mr Farrell kills it, makes it through it. I've 0:10:54.240 --> 0:10:56.200 had the plague here in the last few days and 0:10:56.240 --> 0:10:59.080 now Farrell he got it for me. Is how he 0:10:59.120 --> 0:11:03.000 has blaming on the with Paul Sweeney. He is and 0:11:03.160 --> 0:11:06.800 Paul Sweeney uh is here and we're thrilled that we 0:11:06.840 --> 0:11:08.439 can move forward. And we do that with a very 0:11:08.440 --> 0:11:12.040 special broadcast. We welcome all of you worldwide, particularly on 0:11:12.080 --> 0:11:15.880 a Pacific rim in your evening in Asia, to our 0:11:15.960 --> 0:11:19.880 annual visit to euro to do Eurasia Groups offices in 0:11:19.880 --> 0:11:21.960 New York and of course the centers around the top 0:11:22.040 --> 0:11:25.480 risks of for Asian. Now we do this, Paul with 0:11:25.600 --> 0:11:28.400 a market chourninger all the news slow coming off of 0:11:28.440 --> 0:11:31.239 a rock and a run, and of course in Washington, 0:11:31.320 --> 0:11:33.440 and we'll let others we'll describe that over the hour 0:11:34.280 --> 0:11:37.280 as well, but certainly with futures of negative sixteen DA 0:11:37.440 --> 0:11:41.760 futures negative one fifty eight yields jumble. This morning we 0:11:41.840 --> 0:11:46.120 had seventy dollar oil sixty ninety two on Brent crude, 0:11:46.440 --> 0:11:49.320 and the global Litmus paper that I use dollar yen 0:11:50.160 --> 0:11:52.120 showing me a little bit of calm there one O 0:11:52.280 --> 0:11:56.320 eight sixteen on yen churning at this morning. So certainly, Paul, 0:11:56.360 --> 0:11:58.680 I don't see panic out there to you, I do not, 0:11:58.760 --> 0:12:00.760 and we kind of made that comment on on Friday 0:12:00.840 --> 0:12:03.640 as well. But clearly a new level of risk in 0:12:03.679 --> 0:12:06.080 the market and the market participants across the risky asset 0:12:06.160 --> 0:12:09.160 classes time you mentioned oil as well as the end 0:12:09.200 --> 0:12:11.440 trying to figure out kind of where this goes next 0:12:11.640 --> 0:12:16.440 steps here as relates to renewed min East attentions. A 0:12:16.480 --> 0:12:18.960 lot of news slow there this morning. Course, Kevin Serilllean 0:12:19.000 --> 0:12:21.960 Washington monitoring this as best he can. It is the 0:12:22.040 --> 0:12:25.960 top risky and of COURSI and Bremer and Cliff and 0:12:26.000 --> 0:12:29.200 others had to rip it up and write a new ideas. 0:12:29.240 --> 0:12:32.199 And I believe their third risk of the year, which 0:12:32.280 --> 0:12:36.320 is on the Middle East and particularly on Iran but 0:12:36.600 --> 0:12:40.480 so much of this is about China. Maybe they don't 0:12:40.559 --> 0:12:42.640 leave this year with China. They look at the US 0:12:42.760 --> 0:12:45.880 election is their lead risk. But Meredith Sumter, with this 0:12:46.000 --> 0:12:49.080 head of all their research and of course truly expert 0:12:49.200 --> 0:12:52.880 on China, is well, what's the nuance here in China 0:12:53.280 --> 0:12:58.440 of this January versus a year ago. A year ago, Tom, 0:12:58.480 --> 0:13:01.280 I think there was a great deal more expectation that 0:13:01.360 --> 0:13:03.760 the U. S And China would have some kind of 0:13:03.800 --> 0:13:07.119 trade confrontation but would find some way to resolve their differences. 0:13:07.559 --> 0:13:10.360 A year on where we stand now we have a 0:13:10.400 --> 0:13:14.040 Phase one trade deal. But even with the deal, Tom, 0:13:14.080 --> 0:13:17.480 there is no real truth between the world's two largest economies. 0:13:17.679 --> 0:13:22.520 Does China need a truce? Jan Ping doesn't believe so, 0:13:22.760 --> 0:13:25.800 and he is girding up his population for what he 0:13:25.840 --> 0:13:29.240 believes is going to be a long march to increase 0:13:29.720 --> 0:13:33.680 China's own self reliance and reduce its dependency and risk 0:13:34.080 --> 0:13:37.920 exposure to the United States. The dependency is around sanctions. 0:13:38.000 --> 0:13:39.920 I'm a bit confused here, as I'm sure all my 0:13:40.040 --> 0:13:43.120 listeners are about what sanctions are coming on, which ones 0:13:43.160 --> 0:13:44.959 are coming off. The hope and prayer of getting back 0:13:45.000 --> 0:13:48.040 to some form of not lazy, fair free trade, but 0:13:48.080 --> 0:13:52.560 at least less sanctions. Give us a sanctions update as 0:13:52.600 --> 0:13:56.240 you see it. What's the dynamic of sanctions into two 0:13:56.240 --> 0:13:59.079 thousand twenty. Well, in two tho markets are going to 0:13:59.160 --> 0:14:02.520 be looking for or a partial reduction of tariffs, but 0:14:02.600 --> 0:14:05.480 for the most part, the majority of the tariffs are 0:14:05.520 --> 0:14:08.760 are going to to stay in place. Uh, And we 0:14:08.880 --> 0:14:11.959 could be seeing more tough measures from the US towards 0:14:12.000 --> 0:14:14.800 China this year. It's it's an election year and product 0:14:14.960 --> 0:14:18.120 is nothing changes? Is that right? Not much is changing. 0:14:18.120 --> 0:14:20.480 But I'll tell you what is changing on the negative 0:14:20.520 --> 0:14:23.800 front is you're going to see a hardening of this 0:14:23.960 --> 0:14:29.000 confrontation and locking in that hardened confrontation for the longer term. 0:14:29.360 --> 0:14:31.720 So that's why we have US China as our third 0:14:31.760 --> 0:14:35.440 top risk. But tied to that is our second top risk, TOM, 0:14:35.480 --> 0:14:38.800 which is the Great decoupling. This is essentially China in 0:14:38.800 --> 0:14:42.480 the US, the two largest economies disentangling from one another 0:14:43.240 --> 0:14:45.840 in a way that's going to have spillover effects not 0:14:45.920 --> 0:14:50.720 just in global technology, but in business activity, in research, 0:14:50.960 --> 0:14:54.520 in media and entertainment, in culture. You're going to have 0:14:54.760 --> 0:14:58.480 more of a risk of a true bifurcation of the 0:14:58.520 --> 0:15:01.800 global order in a way that really haven't taken seriously 0:15:02.520 --> 0:15:05.680 since the Cold War. So, Meredith, we had yet to 0:15:05.720 --> 0:15:08.360 see anything really on paper as it relates to Phase one. 0:15:08.400 --> 0:15:09.920 So I hate to even go to phase two. But 0:15:10.000 --> 0:15:14.880 is there any sense of what Phase two could encompass, uh, 0:15:15.000 --> 0:15:17.320 and maybe any sense of timing or is this just 0:15:17.440 --> 0:15:22.840 a tweet out there in the wind terrific question. I 0:15:22.920 --> 0:15:26.280 would say the President and US here Bob Lizzheiser, are 0:15:26.360 --> 0:15:29.160 supremely focused on a phase two. If you talk to 0:15:29.200 --> 0:15:32.440 the actual trade negotiators on the US and China side, though, 0:15:32.440 --> 0:15:36.120 who are going over the substance of what those negotiations 0:15:36.160 --> 0:15:39.600 might entail. No one seriously believes that we're likely to 0:15:39.640 --> 0:15:43.760 see a Phase two negotiation reached completion, And believe me, 0:15:43.800 --> 0:15:46.360 there's a whole lot left on the table there. Phase 0:15:46.440 --> 0:15:50.680 one really is just about a partial teriff reduction, a 0:15:50.760 --> 0:15:54.520 resumption of of some Chinese purchases of of US products, 0:15:54.560 --> 0:15:58.800 namely agg But the core issues at at at the 0:15:58.840 --> 0:16:05.840 heart of the conference tation, industrial policies, subsidies, the misalignment 0:16:06.080 --> 0:16:09.440 of the Chinese economy with the U S economy, that 0:16:09.640 --> 0:16:13.480 all remains, and that's not likely to be fundamentally changed 0:16:13.560 --> 0:16:16.680 by onward negotiations this year. So, Meredith, one of the 0:16:16.720 --> 0:16:19.480 things that this administration has done is it as UH 0:16:19.760 --> 0:16:24.080 really taken trade negotiations with China to arguably the next level, 0:16:24.080 --> 0:16:26.760 a more direct level including tariffs and so on and 0:16:26.800 --> 0:16:30.320 so forth, a more bilateral approach, more aggressive approach. Do 0:16:30.360 --> 0:16:33.760 you think this is the new normal for US China 0:16:34.240 --> 0:16:37.120 UH negotiations or if there is another administration coming in, 0:16:37.160 --> 0:16:40.080 it might go back to something UH that we're more 0:16:40.160 --> 0:16:45.640 used to. This is a this is a new normal 0:16:45.720 --> 0:16:48.200 for US China with the Trump administration. But you know, 0:16:48.440 --> 0:16:51.400 even if you get a democratic administration in office in 0:16:52.320 --> 0:16:55.520 one UH, there is still going to be a hardened 0:16:55.640 --> 0:16:59.360 US approach towards China. Now, they might take a and 0:16:59.480 --> 0:17:03.240 and look all of the Democratic candidates who are still 0:17:03.280 --> 0:17:05.720 in the field. Not one of them has said that 0:17:05.760 --> 0:17:10.119 they would reduce tariffs on China. The difference in approach, however, 0:17:10.640 --> 0:17:15.560 might be more of a collaborative strategy with other allies 0:17:15.640 --> 0:17:18.480 to to play sort of collective pressure on China to 0:17:18.560 --> 0:17:21.560 adjust its approach. One of them is, that's so wonderful 0:17:21.560 --> 0:17:23.679 what your Asia group is. All the horses you're bringing here. 0:17:23.680 --> 0:17:27.040 You've got Robert D. Caplan in helping you out advising. 0:17:27.119 --> 0:17:29.879 Of course, this book Asia's Cauldron and was in my 0:17:29.920 --> 0:17:32.240 Book of the Year a couple of years ago, and 0:17:32.280 --> 0:17:35.560 it is about the South China Sea. How does China 0:17:35.720 --> 0:17:38.399 right now interpret the South China see? Is it just 0:17:38.440 --> 0:17:42.360 as simple as they say, it's ours? It has always 0:17:42.359 --> 0:17:46.960 been in China's mindset, there's and what you're seeing. It 0:17:47.160 --> 0:17:49.240 is it is, but it's it's what you're seeing. We're 0:17:49.240 --> 0:17:53.400 talking about the bifurcating world. Tom. For China, it's reality 0:17:53.400 --> 0:17:56.120 and the sound China see. They've built their outposts, they're 0:17:56.240 --> 0:17:59.760 exercising influence, maybe not absolute control, and maybe they don't 0:17:59.840 --> 0:18:03.000 they don't get a chance showing the flag enough on 0:18:03.040 --> 0:18:07.560 the U S sign We are in in the area. 0:18:07.640 --> 0:18:09.879 But I think that there's enough of a question about 0:18:10.000 --> 0:18:14.800 US staying power in the region and US commitment to 0:18:15.160 --> 0:18:18.440 partnerships and alliances in the region to where the other 0:18:18.520 --> 0:18:21.920 countries in the region are already hedging their bets. Meridith 0:18:21.960 --> 0:18:23.760 sumter with us with your Raiser group, folks, as we 0:18:23.800 --> 0:18:26.760 look at their top risk. A lovely conversation here and 0:18:26.760 --> 0:18:29.199 look for this on our podcast. We are thrilled to 0:18:29.200 --> 0:18:32.760 re emphasize our podcast in this January obviously out at 0:18:32.760 --> 0:18:36.040 Apple Spotify for their names. I'm not hip enough to remember, 0:18:36.560 --> 0:18:40.960 but the podcasts have been hugely, hugely successful. And we'll 0:18:41.040 --> 0:18:45.200 lead with Brummer and Sumter. Uh. This day you read? 0:18:45.480 --> 0:18:48.720 Do you read Chinese? Right? Can you speak it? Uh? 0:18:48.800 --> 0:18:51.240 Not as well? It's hard, it's hard to make that lead. 0:18:52.000 --> 0:18:54.560 What what do you read in China? Explain to our 0:18:54.600 --> 0:18:57.840 audience who are kids? My child's going to take Mandarin 0:18:57.880 --> 0:18:59.800 and that lasts for like two weeks. It's like, you know, 0:19:00.000 --> 0:19:04.960 Ellen lessons. When you read Chinese? How do you read it? 0:19:05.080 --> 0:19:07.600 What do you profession? Is there like a Beijing newspaper 0:19:07.640 --> 0:19:10.480 you read every morning or is it research reports or 0:19:10.800 --> 0:19:13.680 secret things that come in like you know, on pigeons, wings, 0:19:13.720 --> 0:19:16.240 on ravens, wings, like Game of Thrones. When you read 0:19:16.400 --> 0:19:19.639 China in Chinese, what do you read? You read a 0:19:19.720 --> 0:19:23.119 variety of different newspapers. Um, all of them sort of 0:19:23.240 --> 0:19:26.320 state bad. But there are different nuances with the with 0:19:26.359 --> 0:19:31.159 the different newspapers out there. But it's it's a wonderful language. Uh. 0:19:31.200 --> 0:19:33.680 And I think when you when you actually get in 0:19:33.720 --> 0:19:37.280 to the language, you get a sense of the whole 0:19:37.560 --> 0:19:41.399 holy different worldview that is coming from from Beijing. And 0:19:41.440 --> 0:19:46.040 again it sort of leads back into this bifurcated world 0:19:46.240 --> 0:19:49.760 that we're that we're moving into. Neither China nor the 0:19:49.920 --> 0:19:54.600 US is strong enough or is going to take enough 0:19:54.600 --> 0:19:57.159 of the pain to push the other off of the 0:19:57.280 --> 0:19:59.480 helm of global leadership. But they've got to find a 0:19:59.520 --> 0:20:02.280 way to co exist. And what you see in Chinese 0:20:02.320 --> 0:20:06.200 print media, uh, and in commentary frankly on on wayble 0:20:06.320 --> 0:20:10.520 and and and other media social media platforms is increasingly 0:20:10.640 --> 0:20:15.240 China is looking to project its own interpretation of what 0:20:15.359 --> 0:20:22.600 international technology, international trade, international financial architecture, international rules and regulations, 0:20:23.080 --> 0:20:27.199 how those should be shaped to account for Beijing's and 0:20:27.280 --> 0:20:30.520 China's own interests in addition to the interests of the 0:20:30.960 --> 0:20:34.439 traditional Western liberal order. Mare, could you just give us 0:20:34.440 --> 0:20:36.400 a quick update on kind of what is the latest 0:20:36.680 --> 0:20:38.840 from Hong Kong. We know there's been some leadership changes 0:20:38.880 --> 0:20:43.639 there right well, we've we've seen actually just in the 0:20:43.720 --> 0:20:48.679 last couple of days, Beijing appointing a perceived sort of 0:20:48.760 --> 0:20:52.080 hardliner to to go in and be their chief representative 0:20:52.560 --> 0:20:56.399 in Hong Kong. Uh, this is to be expected. Uh, 0:20:56.560 --> 0:21:01.160 Beijing's approach is to strengthen their reach in control over 0:21:01.240 --> 0:21:06.160 Hong Kong, even as the protests show no signs of abating. Uh. 0:21:06.200 --> 0:21:09.800 And you know speculation that Carrie Lamb will be stepping 0:21:09.840 --> 0:21:16.240 down perhaps later this year after the leon Quai, China's 0:21:16.359 --> 0:21:19.920 own sort of meetings in March of their National People's 0:21:19.960 --> 0:21:24.480 Congress and Consultative Conference. But she might step down, but 0:21:24.560 --> 0:21:27.399 that's not going to do anything to to take the 0:21:27.400 --> 0:21:30.080 floor underneath the protests that we see happening in Hong Kong. 0:21:30.200 --> 0:21:32.360 This has been wonderful, Maritus Sumter, thank you so much. 0:21:32.359 --> 0:21:34.639 I thank you to all your research capabilities. Here are 0:21:34.680 --> 0:21:37.840 the different voices we've heard this morning at eur Asia Group. 0:21:51.640 --> 0:21:55.000 Without question, this is our interview of the morning. He 0:21:55.160 --> 0:21:58.840 is Henry Rome and he is far, far too young 0:21:58.920 --> 0:22:01.119 to be this good. He's out of Princeton where he 0:22:01.119 --> 0:22:04.240 had a modest knowledge of the Persian language, and then 0:22:04.280 --> 0:22:09.040 it's going on to a sterling academic career studying the 0:22:09.119 --> 0:22:13.320 Levant and Persia, and he joins us today is truly 0:22:13.359 --> 0:22:17.440 one of the nation's Persian experts. With your Aisia Group, 0:22:17.480 --> 0:22:19.439 I should point out we're thrilled that we have the 0:22:19.480 --> 0:22:22.920 top Risks of two thousand twenty four Ian Bremer's e 0:22:23.000 --> 0:22:25.720 Raisia group this morning, Henry, thank you so much for 0:22:25.800 --> 0:22:29.080 taking time with us. What is the number one thing 0:22:29.320 --> 0:22:34.680 Americans miss of the present Islamic Republic and its linkage 0:22:34.720 --> 0:22:39.560 back to a Persia of long ago? Sure? Thanks, Tom, 0:22:39.560 --> 0:22:42.920 It's it's great to be here here with you. I 0:22:43.080 --> 0:22:46.400 think the number one thing that that Americans missed is 0:22:46.520 --> 0:22:50.480 the prevalence in in today's Iran of the same nationalism 0:22:50.560 --> 0:22:53.320 that we've seen over the past hundreds of years. That 0:22:53.640 --> 0:22:58.800 while Iranians today obviously majority Shia country, but the depth 0:22:59.200 --> 0:23:03.120 of religion and only gets you so far. Really, the nationalism, 0:23:03.160 --> 0:23:06.679 the pride and the empire is still very strong, and 0:23:06.720 --> 0:23:10.800 I think the government today uses that very effectively to 0:23:10.840 --> 0:23:13.080 try to rally around the flag. And then we're seeing 0:23:13.119 --> 0:23:15.840 it right this morning with with the funeral processions for 0:23:15.960 --> 0:23:21.679 costumsula money. We whether we read Dexter, Philkins or George 0:23:21.680 --> 0:23:24.480 Packer the others out in the media, Tom Friedman and 0:23:24.520 --> 0:23:27.719 others writing and the last number of days there seems 0:23:27.720 --> 0:23:30.680 to be a debate about the Islamic Republic. I get 0:23:30.680 --> 0:23:34.240 the idea of nationhood and everyone coalescing. What does the 0:23:34.320 --> 0:23:38.440 new Islamic Republic look like. It's not the same one 0:23:38.480 --> 0:23:42.040 of nineteen seventy nine or even eighty nine after the war, 0:23:42.280 --> 0:23:45.720 is it. No, it's not. It's it shifted in a 0:23:45.760 --> 0:23:48.600