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439: Election 2024: Cooperation, Competition, or War with China?
00:48:43
In this special episode of Pod Save the World, Ben looks at the most important bilateral relationship in the world today: the new era of competition between the U.S. and China. Will the U.S. drift into outright conflict with China, or can we balance competition and cooperation? He reviews China’s attempt to reshape the global order, how the Biden administration has tried to get tougher on China through its trade policy, and how tensions over Taiwan could impact both our economic and military future. Ben is joined by Evan Medeiros, Professor of Asian Studies at Georgetown University, US Trade Representative Katherine Tai, and Ryan Hass, Chair of Taiwan Studies at the Brookings Institution.
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- [00:01]
Ben Rhodes
The kind of burgers you get today tells you a lot about yourself. You're either someone who settles for sad.
- [00:07]
Catherine Tai
Same old, same old burgers, or you're.
- [00:10]
Ben Rhodes
Edit Carl's Jr obsessed with a tangy OG Western bacon cheeseburger demanding a house made guacamole, loaded guac bacon fired up for the insanely hot El Diablo or craving a classic Charbold Famous Star. Give in to your flavored cravings. Do your mouth to Carl's Jr. Big.
- [00:28]
Ryan Haas
Burger good Burger hey Fidelity, how can.
- [00:34]
Ben Rhodes
I remember to invest every month?
- [00:36]
Catherine Tai
With the Fidelity app you can choose a schedule and set up recurring investments in stocks and ETFs.
- [00:43]
Ben Rhodes
Oh, that sounds easier than I thought.
- [00:45]
Catherine Tai
You got this?
- [00:47]
Ryan Haas
Yeah, I do.
- [00:48]
Tommy Vitor
Now where did I put my keys?
- [00:51]
Catherine Tai
You will find them where you left them.
- [00:55]
Ryan Haas
Investing involves risk, including risk of loss Fidelity Brokerage Services LLC Member NYSE SIPC welcome to POD Save the World. I'm Ben Rhodes and this is another special episode in the lead up to November's election where we're looking at what the stakes are for our foreign policy and for the entire world in a Harris and Trump matchup. Now, over the last two episodes we talked about the wars in Ukraine and the Middle East. Today we'll be talking about perhaps the biggest geopolitical competition in the world and one that threatens to turn into another war. That's the relationship between the United States and China. There is no question that China has emerged as the biggest competitor to the United States for global influence. It has the world's second largest economy. It has made massive investments in clean energy and technologies like artificial intelligence, which will determine the future. It has rapidly modernized its military and is expanding its nuclear arsenal. It is building a whole set of institutions like the BRICS and the Belt Road Initiative to challenge the US Led international order and has more influence in America and much of the global South. And the Chinese Communist Party has an ideology that is in direct competition with democracy. Since Xi Jinping took power in 2013, China has become more hostile to the US and its version of the international order, and China has increased its threats and military presence in flashpoints like the Taiwan Strait and the South China Sea. Since Donald Trump won the 2016 election, talking tough on China has become part of American politics and policy for both political parties. What's going to happen and who's going.
- [02:46]
Ben Rhodes
To have higher prices is China and.
- [02:48]
Ryan Haas
All of the countries that have been ripping us off for years. I charge I was the only president ever. China was paying us hundreds of billions of dollars and so were other countries Under Donald Trump's presidency, he ended up.
- [03:02]
Ben Rhodes
Selling American chips to China to help.
- [03:06]
Catherine Tai
Them improve and modernize their military. Basically sold us out when a policy about China should be in making sure.
- [03:15]
Ryan Haas
The United States of America wins the.
- [03:17]
Catherine Tai
Competition for the 21st century.
- [03:22]
Ryan Haas
Now, here's the challenge, though. China isn't going anywhere. Yes, America can't get pushed around. We have to stand up for American jobs and push back against aggression, from cyberattacks to threats to invade Taiwan. But how do we do that without ending up in a war? And how do we do that while also doing things like combating climate change or regulating new technologies like AI, which we cannot do without some cooperation from China. Meanwhile, even as both countries have taken steps to untangle their economies and their supply chains from one another, the truth is our economic fortunes, like the global economy, remain interconnected, much more so than at the height of the Cold War competition between the U.S. and the Soviet Union. So in this episode, we'll talk about what may actually be the most important relationship for the United States in the world. How do we thread this needle between conflict and collaboration with China? You'll hear my conversations with U.S. trade Representative Catherine Tai on what the Biden administration has done to reframe our government's relationship to China. I'll also talk to Ryan Haas, a leading American expert on Taiwan at the Brookings Institution. But first, we'll start with my interview with Evan Medeiros, who gives us the big picture view on the relationship. He's my former colleague who oversaw China policy at the National Security Council during the Obama administration. He's currently a professor of Asian Studies at Georgetown University. I began by asking Evan to describe the current status quo of how China is viewed in Washington, how both parties have become hawks on China.
- [05:01]
Ben Rhodes
There's basically two questions or two issues that are at the heart of China policy. Number one, how do you see the challenge? Number two, what do you do about it? And you're absolutely right. There's been a really substantial convergence of views, but more on, number one, less on number two. I would say, in a bipartisan sense, there's strong belief that China represents a comprehensive challenge. Right. And that's why strategic competition is now commonly used term. When we were in the Obama administration, it was sort of less frequently used, largely under, you know, previous leader Hu Jintao. So real convergence on views in the nature of the challenge, where the differences are more substantial between Democrats and Republicans, is what do you do about it? Right. What are the right set of policies domestically and internationally? That best position The US to compete.
- [05:52]
Ryan Haas
I kind of want to roll back the tape and look at the past and start with Trump. Right. So how would you characterize the difference between Trump's get tough on China approach and Biden's? And we can kind of start with Trump. What would you say were the main characteristics of his first term approach towards China?
- [06:12]
Ben Rhodes
Well, his first term approach, it's difficult to describe because there were really two Trump policies. Right. There was Trump's relationship with Xi Jinping and what Trump's priorities were. And then there was the rest of the administration, a group of folks that had much greater concern. And this is. I'm thinking of people like Secretary of State Planning peo, National Security Council official Matt Pottinger, those folks. So on the one hand, you have Trump, who sort of has this fetish for Xi Jinping, talks very favorably about him, he's a tough guy, that sort of thing, and invited him to Mar a Lago. There's the chocolate cake, if you remember that whole saga. And then who could forget, right? Exactly. So you got Xi Jinping, you have chocolate cake, you got Mar a Lago. What could possibly go wrong? So you have Trump's relationship with Xi Jinping, and then you have Trump's focus on what they called the phase one trade deal, which was basically a deal in which the Chinese promised to buy lots more of American goods, which they ultimately didn't live up to. And then in the last year of the administration, and this is obviously during both Covid and the election cycle, Trump sort of let the hardliners on China take charge. And he himself got a lot more critical of China, in part because it played well politically, but also he was pissed at them for Covid. And people like to say, oh, Biden's policy is basically just Trump policy. It's actually not just Trump policy. There's some important differences. There are similarities. The tariffs, Biden keeping the tariffs. But there's some really important differences. Number one is Biden's investment in America, right? The infrastructure bill, the CHIPS act, the Inflation Reduction Act. I mean, Biden, Jake Sullivan, Tony Blinken, they recognize since we're in a strategic competition, we need to invest in the United States, and they did that. And passing three big bills like that is complicated business. It takes a lot of time and political capital. Second, big difference between Biden and Trump was the degree to which the Biden administration reinvigorated our alliances, reinvested in those alliances, and importantly got our alliances, both in Europe and Asia, I might add, much more aligned in dealing with the China challenge, not just on security issues, but on economic issues and on technology issues. And of course, the question going forward is if Trump gets a second term, what happens to allies? I mean, we're already seeing our European allies on some of their China decision making. France and Germany in particular, already hedging. Right. If Trump gets elected, they may actually need a better relationship with China. And so they're not prepared to perhaps do some things we want them to do right now because of the sort of the Trump hedge informing their China policy.
- [09:16]
Ryan Haas
Okay, so looking forward, let's stay with Trump and then we'll get to Kamala Harris. It feels to me like what's obvious is that the Chinese have kind of, in some ways they're trying to build their own parallel alternative world order set of institutions. Right? They've got the Belt Road initiative, they've got some nascent security partnerships that they're trying to build. They have this no limits partnership with Russia. There's challenging kind of US Primacy. And the US Led international order. And as you point out, they kind of seek to peel off US Allies in Asia and Europe from the US on as many issues as they can describe. Kind of on the one hand, a Trump presidency would bring probably more belligerence on issues like tariffs. But on the other hand, how would you describe the opportunity that a Trump presidency might present to China geopolitically?
- [10:13]
Ben Rhodes
I think a Trump presidency could be a huge opportunity for the Chinese. So they look at Trump and they think, well, as uncertain and volatile and challenging as it may be to manage relations with him, he is not somebody that is going to keep the United States on the trajectory of long term competition. The way I look at the world these days, Ben, is we're going through one of these very significant, historic, really tipping points in international politics. We're transitioning to a world that's really going to be constituted by three broad groupings. The Global west, the Global east and the Global South. The Global west is the United States, our allies in Europe and our allies in Asia. These are people that believe in the liberal rules based orders and that's both. They share both our interests and values. The Global east, you've got Russia, you've got China, you got North Korea and Iran who want to make the world safe for authoritarian leaders. They believe that state directed development strategies are sufficient. Then you have this huge group in the middle, very heterogeneous group, the Global South, Middle East, Africa, Latin America, the Chinese ability to position themselves to advance their vision of global order, to advance Their values, authoritarian political systems, state directed development, all of that stuff. Their ability to advance that vision improves under a Trump presidency.
- [11:44]
Ryan Haas
And what do you think the consequences are for Americans in this scenario? Right. Why should it matter to Americans that China might have a lot of running room to kind of write the new rules of the world order if Donald Trump is alienating us from other countries, including our allies?
- [12:03]
Ben Rhodes
Well, most practically, if the Chinese start to write the rules of global order, especially on trade and investment, I think it just means that our lives become a lot more difficult. Getting access to goods, paying for things. I mean, it's a world in which everything is more inflationary. It's a world in which perhaps America is no longer driving the key technologies of the 21st century. Semiconductors, AI, quantum computing, biotechnology. Right. It's a world in which perhaps Chinese technology in coordination with other countries, sort of sets the standards.
- [12:44]
Ryan Haas
And here there's going to be competition. The US is kind of leading the race in the development of generative artificial intelligence, but China's right there too. And I've actually been struck by their capacity to kind of work around technology restrictions. They're bringing their own large language models online. They're going to begin to export those technologies, are very good at things like robotics and industrial AI. The question is, what is the balance between trying to kind of win this competition for the development of AI? But at some point we need to develop some international norms and regulations around even extreme risks like, you know, AI and nuclear command and control or AI related to the development of biological weapons.
- [13:26]
Ben Rhodes
I mean, I think that your, your point is one of the central challenges in this new era of global order we face. And you know, the unfortunate reality is policymakers are going to privilege the competition side over the norm, development side, because we are in this very early stage of this long term strategic competition. And in part because, you know, to be very frank, as a China specialist, I'm confident in stating the Chinese are just not interested in having a serious conversation about norms. I mean, conceptually, they have not accepted that restraint, either unilateral restraint or mutual restraint is in their interests. And what history tells you, Ben, is that the US and the Soviet Union didn't come to that understanding either until after the Cuban Missile Crisis. And look, I'm not predicting a US China Cuban Missile crisis. I'm just saying historically it's very hard for great powers when they're involved in a pretty intense competition. And in the case of the US and China, a broad spectrum competition. Competition on economic, security, technology and governance. Ideas very hard for either one of them to get to that point. As you know, there have been discussions between the US And China on AI, so that's a good thing that they've started. But I think that, you know, as a. As a practical matter, that that whole issue set will tend toward the competitive dynamics more than the norm development right now.
- [15:10]
Ryan Haas
Okay, so if. Let's take the better scenario of Kamala Harris presidency. First of all, what do you think if Xi takes office in January, what do you think the most important issues are going to be for her in the US China relationship in the next few years?
- [15:28]
Ben Rhodes
Well, the first thing you need to do is you need to make sure that you're well positioned in Asia. Right. It's become almost cliche in the Asian studies world to say, you know, the best China policy is a strong Asia policy because, you know, having those solid, reliable, capable allies in Asia is in many ways the platform from which you can shape the environment around China and I think influence China's choices about whether it's going to be aggressive or whether it's going to be restrained in both its economic policies and its security policies. So I think that's sort of. That's very much task number one. And I think that one big challenge for the next administration is going to be making sure that the US And Europe stay very aligned. I mean, I'm very concerned about the China Russia relationship. And I think that we're going to need more policy coordination with the Europeans to communicate to the Chinese how costly their commitment to Russia is, because a very robust China Russia axis has huge geopolitical consequences for us. And then, of course, there's the whole issue of dialogue, right? Setting up channels of dialogue with the Chinese to make sure the Chinese understand what our goals are, what our goals aren't, when it's no coincidence that the channel of communication between Jake Sullivan and Xi Jinping's top diplomat, Wang Yi, have really been central to so much of the management of the most complicated issues in the relationship, especially in the Taiwan issue. And some of the Trump team has been very critical of the Biden team for opening these channels of communications, is somehow lessening up on competition, which it wasn't, and somehow signaling weakness to the Chinese, which I don't think it is. And I think that's a very dangerous way to look at communication, because communication is one of the central components of deterrence.
- [17:30]
Ryan Haas
And so just to tie this all together, one more question is just simply, how would you sum up the, you know, the choice, you know, and I mean, I think we probably have our preferences here. Why would a Harris presidency be preferable to a Trump presidency? When it comes to US China policy and the state of the world, it.
- [17:50]
Ben Rhodes
Really has to do with ensuring that the United States remains strong and our interests are protected and our values are defended and the global rules, norms and institutions we believe in are all supported. What the former Trump administration officials now talk about is confrontation, confrontation, confrontation. If the US Goes down that road of exclusively a confrontational policy toward China, with almost no dialogue, and at the end of the day calling for or suggesting an end state of regime change, we're not going to win that competition. That's a competition where our allies and partners globally, much of the world, doesn't sign up for what we're offering. And so that's a world in which America loses credibility, a world in which America loses influence, loses market access. And that's profoundly not world in our interests.
- [19:06]
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Ben Rhodes
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- [22:14]
Ryan Haas
So as you heard Evan describe both parties, they're getting tough on China, but there's a difference in how they're doing that Now. Biden has prioritized building alliances so that we're not pressuring China all by ourselves. And he's also focused on investing in the United States so that we're on a stronger foundation to compete with China. With Trump, it's a bit different. He prioritized when he was in government, his trade war with China, all the tariffs that he put in place. And he also prioritized his relationship with Xi Jinping, which is complicated. My own view is that there's a little too much groupthink right now on China and Washington. There's this kind of competition to see who can be tougher, who can sound tougher. And look, that's important. It's important to be tough on some things, but we also have to be smart about it. You don't want to be so tough that you end up in a conflict over something like Taiwan. And you also don't want to avoid negotiation when you need to negotiate something like I think we probably have to do on issues related to nuclear weapons or the future of artificial intelligence or definitely the need to combat climate change. Now, Evan is right to be skeptical about whether we can secure Chinese cooperation on issues like that because, you know, frankly, Xi Jinping might not be interested, but I think Evan would agree that it becomes dangerous when we don't even try. If you make the effort, you can at least kind of keep tensions down and maybe, maybe you can open some windows to make some progress. Now, Evan gave us this big picture view of the geopolitical competition between the U.S. and China and why we have to be careful with that mindset of strategic competition. We want it to be strategic rather than just reactionary to everything China's doing. Next we'll get down to brass tacks with U.S. trade Representative Catherine Tai. We're going to take a look at how specific trade and economic policies pursued by the Biden administration over the last four years have positioned a potential President Harris or Trump, although we obviously don't want that to happen now. This gets a little wonky, but this is really, really important stuff. And it's actually like quite populous stuff too, because over the last decade, the US has shifted away from the kind of neo liberal consensus of the post Cold War years, the kind of full embrace of globalization that saw a lot of American jobs shipped overseas to China, that saw a lot of concerns that the playing field wasn't level, that Chinese companies were stealing US Intellectual property and subsidizing their own industries in ways that led to really an unfair advantage in some cases. So increasingly, the United States is using a range of tools, a range of measures from tariffs on Chinese goods to restrictions on U.S. exports and investments into China to try to protect American jobs and American industries and ensure that the United States is leading in the development of key technologies like artificial intelligence. So it's really important to understand this. Now. This was on display when the US Slapped tariffs on Chinese electric vehicles, among other products, earlier this year. The fact is, American workers are can outwork and out compete anyone as long as the competition is fair. But for too long, it hasn't been fair. For years, the Chinese government has poured state money into Chinese companies across a whole range of industries. Steel, aluminum, semiconductors, electric vehicles, solar panels, the industries of the future and even critical health equipment like gloves and masks. China heavily subsidized all these products, pushing Chinese companies to produce far more than the rest of the world can absorb and then dumping the excess products onto the market on unfairly low prices, driving other manufacturers around the world out of business. Now, to unpack this approach, I sat down with Catherine Tai. Coincidentally, we spoke about the same time that the United States rolled out its last round of tariffs on China. Here's what she had to say.
- [26:02]
Catherine Tai
So I'm going to take you back and review a little bit of history. In 2017, I believe it was the Trump administration had initiated a section 3, 301 Trade Enforcement Investigation over China's alleged intellectual property rights abuses and forced tech transfer policies.
- [26:21]
Ryan Haas
This is the idea of them basically stealing intellectual property from US, from American.
- [26:26]
Catherine Tai
And other foreign companies. Exactly. In 2018, the first sets of tariffs started being imposed on Chinese imports into the United States as a way of responding to and trying to remedy findings that there had been IPR abuses and forced tech transfer policies that had harmed the American economy. There were multiple sets of these tariffs that were put down. I think over the course of the next months, there were four tranches of tariffs.
- [26:57]
Ryan Haas
So President Biden comes into office and did not decide to just lift. Like he could have reverted to some pre Trump status quo. Instead, the decision was made. We're going to keep this architecture in place.
- [27:08]
Catherine Tai
I think there are some people who are surprised by that. I think there are people who maybe aren't very read into the challenges of the U.S. china Trade and economic relationship. Ben, I know you served in the Obama administration in that second term of the Obama administration. So 2012 through 2016, I think that it was pretty clear that this relationship, the tensions were really intensifying over the course of that time. If you remember, there was that moment where President Obama brings Xi Jinping aside, at least as it's been reported, and says, hey, we know what you guys are doing with respect to cyber thefts.
- [27:50]
Ryan Haas
Yeah, I remember that.
- [27:51]
Catherine Tai
Well, you need to stop it. And that got reported out and it was commonly known. So I think just on this issue alone, but more broadly, in the economic competitive tensions between the United States and China, I feel like no matter who was going to take over as US president in 2017, that this relationship was going to be on a very, very different track. And so coming in to this term in 2021, President Biden and I and the rest of the team are looking at the relationship between the United States and China. And it's been through a Lot more. And it's very clear that the direction, the trajectory we're headed in is just intensifying in terms of the challenges that we have.
- [28:40]
Ryan Haas
So you've got a few different concerns. Obviously one that you mentioned is pretty straightforward things like the theft of intellectual property. The other thing that's kind of been in the news a lot lately is that and periodically. And we are in one of these phases where it feels like. And it's not just the US that's complaining about this. China has a lot of oversupply in certain areas of the economy. And dumping is the word that is used for people who don't follow trade parlance that much. It basically just means you're dumping an oversupply of stuff into markets that is messing with prices and messing with industry here in the United States that feel like the Chinese are flooding markets with their oversupply in ways that are unfair. Did that factor in to what your decisions are and where have you seen the most harm being done from China flooding markets.
- [29:37]
Catherine Tai
So let me take your China flooding markets piece up head on. So I agree with exactly how you've described dumping. What I would say is it's an overproduction oversupply. And then in terms of the price effects, if you're producing more than the market requires, you're going to pull the price down. Yeah, right. And so a big part of this particular type of practice, which is a bit like predatory pricing, is that you've produced so much, you're selling at such low costs that in the receiving market, like the US market, producers of the same goods or types of goods can no longer compete and are driven out of the market. And over time, then one of the harms that you see is allowed Beijing, through its policies to corner the market in China for the production of lots and lots of different types of goods. Where we used to be an up and comer in terms of solar production. Yeah.
- [30:38]
Ryan Haas
They're trying to basically corner the market.
- [30:41]
Catherine Tai
That's exactly what it is.
- [30:42]
Ryan Haas
And things like solar and batteries.
- [30:45]
Catherine Tai
That's right.
- [30:45]
Ryan Haas
I'm going to step back a little bit now. And if you're reflecting back on the last almost four years now, trade is something that everybody knows is really important. And there's been a lot of anger in recent years about the way in which trade has hurt certain communities and sectors of the American economy. On the one hand. On the other hand, everybody knows we're in a globalized world. There has to be trade. What are you proudest of in terms of the changes you've made and President Biden's Made in U.S. trade Policy and how that interacts with the ordinary day to day life and economy that Americans live in.
- [31:26]
Catherine Tai
We have justified a couple generations worth of trade policies with this thought that we're cutting costs, we're maximizing efficiency, we're taking away barriers, we're liberalizing so that the more trade that there is, the more peace there is, the more prosperity and people are going to benefit because the low, low prices. But one of the challenges is that as we lower barriers and liberalize trade, what we're doing is we're advantaging and incentivizing our trading partners to undercut us and each other in terms of basic protections for our people and our workers, but also for our environment and our planet. And that kind of game where we keep undercutting each other to offer the lowest price jurisdiction for production, has taken us to a completely unsustainable place where you might have low, low prices, except that those prices may be built on the backs of slave labor. It also is, say, in our market, right, providing low, low prices to people who are experiencing downward pressures on their own wages so that even as productivity might increase in the United States, we haven't seen, seen the same level of increase for wages that we would want to see. So that is absolutely the connection between the consumer who may benefit from low prices, may also be, or almost always is the same worker whose wages are being depressed and who overall could be worse off than better off because of this system of trade liberalization, what we call globalization and a neoliberal philosophy of how we pursue trade. So when you hear President Biden say this, and I hear him say this all the time, that his vision for the American economy is to build the economy from the middle out and the bottom up. Kind of have to imagine, you know, his hands going middle out, bottom up. It's the reverse of trickle down, top down, right. Where President Biden will talk about, you know, in my household, when he was growing up, they didn't see the wealth and prosperity being created trickle down to their kitchen table. And we see that across the board in terms of the widening inequality here in the United States, but around the world, vast amounts of wealth, overall prosperity being created, that's not actually being widely shared. And so today, when we are grappling with challenges both domestic and foreign, and we are thinking about how to strengthen our democracy, and that's about empowering our people to participate in our economy, there is this international component where we are perceiving governments Taking on monopolistic behaviors that are threatening not just our economic opportunities, but also our democracies. And so what I really want to.
- [34:33]
Ryan Haas
Emphasize that's interesting, so take China. China engages in kind of monopolistic behavior by having these almost state selected areas of the economy where they're going to try to dominate the market. And they'll do anything. They'll cut corners to do it. They'll steal intellectual property or they'll pour government subsidies into an area in ways that then hollow out communities in ways that contribute to dissatisfaction with democracy. Because that's happening, that's bad. I mean, when you talk to China, what's that like? I mean, do you make these arguments directly to the Chinese government or to other governments that are involved in monopolistic ways? I mean, as a trade negotiator, how do you raise these kinds of issues?
- [35:22]
Catherine Tai
So this is an area where, again, I'm extremely proud to be a part of the Biden administration, where our teamwork is extremely strong. So from the President on down, I know Secretary Yellen has recently gone to Beijing, Secretary Blinken as well. And in my conversations with Chinese counterparts, we've all been exactly on the same page talking about this excess capacity and in this particular moment, our collective concern here in the United States and on behalf of our administration that as China grapples with its own economic downturn, that it is going to rely on its tried and true playbook of exporting its way out of its economic troubles. And that means doubling down on manufacturing production, excessively producing, pumping goods into the global economy, and then inflicting a significant amount of harm on our economies and our opportunities and our ability to compete and thrive. I think that this is in many ways a crystallization of the problem that we have with the legacy of our neoliberal economic policies, where you are literally pitting your middle class against someone else's middle class. The survival and the success of your workers versus someone else's. This brings us back to the central challenge that we have at this time to articulate. New set of rules, new set of norms, a new vision for globalization where we stop doing this to each other. How can we create different incentives in the world economy? How can we start building towards that by selecting first strategic sectors with strategic partners to prove the concept that you can have a version of globalization that is sustainable, that is brighter, and that doesn't pit people against other people, governments against governments, middle classes against middle classes.
- [37:29]
Tommy Vitor
Positive. The world is brought to you by Oracle, even if you think it's a bit Overhyped AI is suddenly everywhere from self driving cars to molecular medicine to business efficiency. If it's not in your industry yet, it's coming fast. But AI needs a lot of speed and computing power. So how do you compete without cost spiraling out of control? Time to upgrade to the next generation of the cloud Oracle Cloud Infrastructure, or oci. OCI is a blazing, fast and secure platform for your infrastructure, database, application development, plus all your AI and machine learning workloads. OCI costs 50% less for computing and 80% less for networking, so you're saving a ton of money. Right now. Oracle is offering to cut your current cloud bill in half if you move to OCI for new US customers with minimum financial commitment. Offer ends December 31, 2024. See if your company qualifies for the special offer@oracle.com world. That's oracle.com world this show is sponsored by BetterHelp. I want to take a moment to say thank you to my mother. Oh, she was just here for a couple of days. Hannah was out of town. She helped me with the two kids. We got to hang out, spend some time together, see her spending time with the grandkids. It was very nice.
- [38:39]
Ryan Haas
Lovely.
- [38:39]
Tommy Vitor
This month is all about gratitude. And along with thanking family and friends, there's another person we don't get to thank enough ourselves. It's sometimes hard to remind ourselves that we are trying our best to make sense of everything. And in this crazy world, that isn't easy. Here's a reminder to send some thanks to the people in your life, including yourself. Hey. Hey you. It's me patting myself on the back. That's me patting myself on the back. You're doing great. If you're thinking about starting therapy, give better help a try. It's entirely online, designed to be convenient, flexible, and suited to your schedule. Just fill out a brief questionnaire to get matched with a licensed therapist and switch therapists anytime for no additional charge. Listen, it's a stressful time of year. Sure is. Politics. Seasons are changing. Kids are going back to school. Life's different. Talk to a therapist. It'll make you feel better. Give it a shot. Let the gratitude flow with BetterHelp. Visit betterhelp.com crooked world go today to get 10% off your first month. That's BetterHelp. H E L P.com Crooked World hey.
- [39:34]
Catherine Tai
Fidelity, what's it cost to invest with the Fidelity app? Start with as little as $1 with no account fees or trade commissions on U.S. stocks and ETFs.
- [39:46]
Ryan Haas
Hmm.
- [39:46]
Catherine Tai
That's music to my ears. I can only talk Investing involves risk.
- [39:52]
Ryan Haas
Including risk of loss.
- [39:53]
Ben Rhodes
Zero Account fees apply to retail brokerage accounts only. Sell order assessment fee not included.
- [39:56]
Tommy Vitor
A limited number of ETFs are subject to a transaction based service fee of $100. See full list@fidelity.com commissions Fidelity Brokerage Services LLC Member NYSE SIPC.
- [40:11]
Ryan Haas
Okay, so you just heard from Catherine about how the Biden administration maintained a lot of Trump's kind of get tough on China approach, including his tariffs. But you also heard how they went well beyond that, building a whole new set of tools to compete with China economically, to try to bring other countries along with this approach. Of course, it's really important to note that economic competition like that, yes, it's important in protecting American jobs and American industries, but inevitably it raises tensions across the board in the US China relationship. So yes, it helps the American economy, but it also pushes China closer to countries like Russia. It makes it harder to deal with hotspots like Taiwan and the South China Sea, and it raises the stakes for the United States and China as they compete for influence around the world, including in the global South. So if she wins, Kamala Harris inherits a lot of tools to compete with China, but also a lot of tension with China. So next we're going to focus on the biggest potential Foch point, the one that is most likely to lead to a war and a really big war potentially, and that is the future of Taiwan. Now, for many Americans, this may seem like a distant concern, but I think you'll find after listening to this next conversation that our policy towards Taiwan is deeply tied to our own ability to be a global innovator, to be a standard bearer for democracy, to maintain our relationships in Asia and around the world. And frankly, it's important to the stability of the entire world. So one plug before we go a little bit further. A couple of years ago, I read a long article for the Atlantic about Taiwan and its unique circumstance. I interviewed the president of Taiwan, senior officials, a lot of really interesting young civil society activists. So you can check that out if you want a little more background to explain all this. In this episode, I spoke with Ryan Haas, who's the perfect guy to talk to. He is the Chair of Taiwan Studies at the Brookings Institute Institution. He's a leading expert on Taiwan. He worked with me in the Obama administration. And I began by asking Ryan, how do people in Taiwan view the Harris and Trump matchup?
- [42:19]
Kamala Harris
Well, it's interesting. I was just in Taipei a few weeks ago, Ben, and at the end of the Trump administration. A lot of people in Taiwan were supportive of President Trump. It was one of the unique places in the world where there was enthusiasm for President Trump because they felt like he was strong and had clarity of conviction around basically his opposition to China, which gave comfort to people in Taiwan that he would be on their side. Fast forward four years and the picture looks a bit different. I think part of that is a function of the fact that the Biden administration has done a lot of work to reassure the people of Taiwan that they have their back. But part of it is basically what President Trump has said over the past several years. And what he has said is that Taiwan has ripped the United States off, stolen America's semiconductor industry, and that Taiwan doesn't pay enough for its own defense. In other words, it's like an insurance holder that isn't paying a high enough premium for America's defense. And I think that that's sat pretty poorly with people in Taiwan. And as a consequence, I think they're much more open minded to the idea of Vice President Harris than they would have been a couple of years ago.
- [43:24]
Ryan Haas
I think sometimes Americans, they hear about Taiwan, but they're not quite sure what the stakes are, what the issues are. How important is the next four years in U. S. Taiwan relations?
- [43:36]
Kamala Harris
President Xi has instructed his military to be ready to go by 2027. That's the deadline that the PLA has to be operationally capable of conducting a military operation against Taiwan. Taiwan's leader is more supportive or inclined towards Taiwan having separation or independence from mainland China than previous leaders have been, and more willing to be sort of outwardly expressive in his views on this. And the United States, you know, has a lot on its plate. We are dealing with Ukraine, we're dealing with the Middle east, and we're dealing with a defense industrial base that's struggling at the same time that China is producing ships at a pace that even exceeds the pace at which the United States built ships at the height of World War II. And so you sort of. You add all these pieces together and then layer on top of it the fact that President Xi is aging and may be growing more impatient as his actuarial table sort of comes closer to being realized. And it creates a very dangerous combination of factors that have focused minds appropriately on risk in the Taiwan Strait in the coming four years.
- [44:43]
Ryan Haas
Let's actually just start with kind of the semiconductor issue, the chips issue, because I think not everybody's familiar with just kind of how essential Taiwan is to the American and global economy in ways that could be disrupted in any kind of military contingency. I'm sure you get this question a lot, but why does Taiwan matter? And why does it matter specifically to not just the American alliance network in Asia, but to the global economy and global technology supply chains?
- [45:15]
Kamala Harris
Yeah, 90% of the world's advanced chips are produced in Taiwan. Taiwan is the beating heart of the global economy. What gets produced there is what drives innovation and industries around the world. Nvidia, which is the growth engine of the American stock market, relies almost entirely upon Taiwan for production of its chips. And so what happens in Taiwan has ripple effects for the entire world, for the global economy, and also for the livelihoods of people in the United States. Bloomberg has done an estimate of what would happen in the events of a cross strait conflict, and the number that they've come up with is a $10 trillion hit to the global economy. That's real money. So that matters significantly, but it's broader than just economics. Of course, you alluded to this in your question. Taiwan is a real bellwether for the credibility of America's security commitments. And so if the United States is seen as pulling back from its commitments to Taiwan in the face of Chinese pressure, I think it'll have consequences for our relationships in Japan, South Korea, Australia and elsewhere. But there's also values that sort of tie the United States and Taiwan people together. We share a view in democracy and individual liberties, universal values, and that matters a lot. And then there's finally, I think the American people care about sort of a David and Goliath story. They don't like seeing people being picked on by bullies. And we're seeing that in Ukraine today. I hope that we never see it in Taiwan tomorrow.
- [46:46]
Ryan Haas
All right, so let's inhabit the two possible realities here. And just to start with Trump, you talked a bit about kind of how he's been more erratic in his statements on Taiwan out of the presidency, strangely, than when he was there. What is the risk of a Trump presidency? Because to me, it's actually if he really means what he says, that he doesn't really care, and they've been ripping us off. Ironically, there's two ways you could have the US Help bring about a conflict. One is if we're overly provocative in ways that trigger the Chinese. But the other is the risk of Trump that he signals he cares so little about Taiwan that it's gonna open the door. I mean, what are you concerned about in the scenario of a Trump election in this four year window?
- [47:38]
Kamala Harris
I think Ben, I'm scared about the fact that it's impossible to predict where President Trump will come out on questions related to Taiwan. If you think back to when he was in office in his first term on Xinjiang, he said basically to President Xi, do whatever the hell you want. On Hong Kong, he said, I don't really care. I care about a trade deal. It raises fundamental questions about if a choice were ever presented to him on a Taiwan scenario, how he would approach it, what factors he would use. The other cause for concern is that he is basically so transactional. It's not hard to imagine a scenario where he has a higher priority with China and sees Taiwan as a source of leverage or a tradable item to achieve the goal that he is pursuing with Xi Jinping. Either of those scenarios leads us to a bad place. It undermines the credibility of our commitments, and it puts at risk the lives of 23 million people in Taiwan.
- [48:31]
Ryan Haas
We'll spend a little more time on Kamala Harris, because in some ways, that's a more, well, rational scenario to consider. There's this kind of tension between the need to increase arms sales to Taiwan that are focused on giving them the capabilities they need to defend against a potential Chinese invasion, in part to try to deter that invasion, the tension between that and the need to kind of not ratchet things up too hot in the Taiwan Strait to have lines of communication with Beijing to avoid miscalculation or escalation. How would you advise an incoming Harris administration to think about that balance for the next four years?
- [49:13]
Kamala Harris
Well, I mean, this is a question that people much smarter than me have been wrestling with for the past 50 years. And so I approach it with a fair degree of humility. But a few things sort of come to mind. The first is that we need to sort of maintain clarity on what our first principles are. We're not advocates for unification. We're not advocates for independence. What we care about America's national interest is in preserving peace and stability in the Taiwan Strait, period. That's the North Star. That should guide all decisions related to Taiwan. Second, it's worth bearing in mind that this is a unique issue for American foreign policy. We're typically inclined towards solving problems, fixing things. This isn't a problem that has an American solution to it. And so really, what we're trying to do is preserve a certain degree of equilibrium. If China is putting too much pressure on Taiwan, then we want to find ways to counterbalance that. And the ways that I would recommend to an incoming administration, Ben, are to do more and say less. In other words, mass capabilities that really matter in a Taiwan contingency in the Asian theater, but not in ways that are humiliating to Xi Jinping or that make him feel like he's backed in a corner. Maintain continuous communication with Beijing to clarify the intentions of their actions and also to make sure they have clarity in their understanding of our own and to really underscore to folks in Beijing that a unsatisfying status quo is a hell of a lot better for them than a ruinous conflict would be. And with Taiwan, to the extent it's necessary, you know, to really remind them that our interest is in peace and stability, and that's what's going to guide our approach.
- [50:50]
Ryan Haas
And, you know, just when you look at the direction of American politics, it's gotten increasingly at times anti China, and China is an easy boogeyman to hit. There's this kind of bipartisan consensus that we needed to get tougher on China. Does that worry you at all that there's this kind of drift into a kind of conflict paradigm with Taiwan obviously being the biggest flashpoint?
- [51:20]
Kamala Harris
Yeah, Ben, I think that the pendulum may need to self correct a little bit in terms of our threat perception from China. China is an enormous challenge. It's an enormous threat. I think it's probably the largest challenge that we face in the world over the mid to long term. And they have tremendous strengths, but they also have acute vulnerabilities. And I think we need to be able to see both its strengths and its weaknesses side by side in order to form a more accurate picture of the challenge that we face. But I also think that we need to try to break beyond this everywhere, everything, all at once anxiety that we have about China and really begin to look at issues on their own merits to understand what is it that we most want to achieve, what do we most want to avoid, and what tools of statecraft will help us get there. Right now it seems like we're just sort of. We're a bit insecure and insecurity is not attractive in human beings. It's not attractive in countries either. I think the more that we can sort of regain a bit of confidence and strength and conviction about our vision for the future. Let's let China react to us rather than us constantly being in a defensive, reactive posture to their actions.
- [52:37]
Ryan Haas
Okay, so as you heard, the stakes are incredibly high, right? I mean, there are questions that are going to be answered probably in the next few years about whether there's going to be a war in Taiwan. You heard about how the global economy really depends upon the semiconductor industry in Taiwan. So the next four years are going to be critical. And again, the stakes are nothing less than war and peace and the future of Taiwanese democracy and the international order itself. So these are big issues. But of course, the issue that has the largest stakes for the future of the planet and all our children and grandchildren and ourselves at this point is one that curiously doesn't get a lot of attention in our politics, hasn't come up a lot in this campaign. But as we've seen in just recent weeks, with enormous hurricanes hitting the United States, climate change is already here. It is already transforming our world. And so in the next and last episode of our election series, we are going to look at probably the clearest possible contrast you can imagine between what a Kamala Harris presidency would mean for the future of the planet and efforts to combat climate change and what a Donald Trump presidency would mean for the future of the planet. If you have any qualms about who you're going to vote for, I think this issue alone should tip you over the edge. But please check out the next episode as we complete our series by looking at the stakes for climate change in the 2024 election. Pod Save the World is a Crooked Media production. Our producer is Ilona Mankoski. Our Associate producer is Michael Goldsmith. Our executive producers are me, Ben Rhodes and Tommy Vitor. The series is mixed and edited by Charlotte Landis with audio support by Kyle Seckler. Our Senior Video Producer is Phoebe Bradford and Video Editor is Brady Kane. If you want to get ad free episodes, exclusive content and more, consider joining our Friends of the Pod subscription community@crooked.com friends. Don't forget to follow us at Cricut media on Instagram, TikTok and Twitter for more original content, host takeovers and other community events. Plus find Pod Save the World on YouTube for access to full episodes, bonus content and more. If you're as opinionated as we are, consider dropping us a review.
- [55:19]
Catherine Tai
Hey Fidelity, what's it cost to invest with the Fidelity app? Start with as little as $1 with no account fees or trade commissions on US stocks and ETFs. That's music to my ears. I can only talk Investing involves risk.
- [55:37]
Ryan Haas
Including risk of loss. Zero Account fees apply to retail brokerage accounts only.
- [55:39]
Ben Rhodes
Sell order assessment fee not included.
- [55:41]
Tommy Vitor
A limited number of ETFs are subject to a transaction based service fee of $100. See full list@fidelity.com commissions Fidelity Brokerage Services LLC member NYSE SIPC.
- [55:52]
Ryan Haas
Looking for toys.
- [55:53]
Ben Rhodes
That'Ll get the biggest reactions.
- [55:54]
Kamala Harris
Yes, please not freak.
- [55:56]
Ryan Haas
Walmart has jaw dropping toys.
- [55:58]
Ben Rhodes
Like for real.
- [55:59]
Ryan Haas
Daisy, Yoga Goat Awesome.
- [56:01]
Ben Rhodes
Razor crazy Cart shuffle.
- [56:03]
Tommy Vitor
Whoa.
- [56:04]
Ryan Haas
Hot Wheels, Bluey, three in one airplane playset, and more.
- [56:10]
Catherine Tai
Aren't you gonna say cool?
- [56:12]
Ryan Haas
I'm saving it for the holidays.
- [56:14]
Catherine Tai
Smart.
- [56:16]
Ben Rhodes
Aw, freak out. Welcome to your Walmart.