The Axis of Autocracies Lining Up for World War III

Summary

WSJ What’s News: The Axis of Autocracies Lining Up for World War III Release Date: December 16, 2024

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1. Introduction and Key Headlines

In this episode of WSJ What’s News, host Pierre Biename delves into significant global and domestic developments shaping the geopolitical landscape. The episode covers a range of topics, including a massive investment announcement by President-elect Donald Trump and SoftBank, escalating global conflicts hinting at a potential World War III, a tragic school shooting in Madison, Wisconsin, and shifting dynamics within the Democratic Party on Capitol Hill.

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2. US and Global Political Developments

a. Trump and SoftBank’s $100 Billion Investment

At the heart of today’s headlines is the monumental announcement made by President-elect Donald Trump and SoftBank Group CEO Masayoshi Son. The duo unveiled a plan for SoftBank to invest $100 billion in U.S. projects over the next four years. This investment aims to create 100,000 jobs focused on artificial intelligence and emerging technologies, with the goal of completing these initiatives by 2029, coinciding with the end of Trump’s term.

Notable Insights:

• Alex Leary, National Politics Reporter, emphasized the symbolic significance of this move:

  “[...] $100 billion is a huge amount for no matter what company. And Trump heralded this as basically saying, ‘I’m back, America’s back and the economy’s gonna be great. Come invest with us.’”
  (02:37)

b. Financial Feasibility and Future Implications

Pierre Biename raised a critical question regarding SoftBank's ability to manage this colossal investment, given that the company reportedly has only $30 billion in cash reserves.

Alex Leary responded:

“That's a very big question, a very big open question. [...] he's going to have to more funds in order to make this work.”
(03:15)

This leaves stakeholders and analysts pondering the sustainability and execution of such a substantial financial commitment.

c. Trump's Press Conference Highlights

Following the investment announcement, Trump held his first press conference since winning the election, addressing several key issues:

• Tariffs: Trump reaffirmed his stance on continuing the use of tariffs on imports globally.

• Potential Pardons: He hinted at the possibility of pardoning New York City Mayor Eric Adams, who is facing charges related to bribery, fraud, and campaign finance offenses.

• Syria’s Regime Change: Trump credited Turkey for the victory of Syrian rebels in overthrowing Bashar al-Assad’s regime.

• Mysterious Drones Over New Jersey: Addressing concerns about unexplained drones, Trump stated:

  “The government knows what is happening. Look, our military knows where they took off from. If it's a garage, they can go right into that garage. They know where it came from and where it went and for some reason they don't want to comment and I think they'd be better off saying what it is.”
  (04:17)

Trump did not confirm whether he had received a security briefing regarding these drone sightings.

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3. Global Conflicts and the Rise of an Autocratic Axis

Chief Foreign Affairs Correspondent Yaroslav Trofimov provides an in-depth analysis of the shifting global power dynamics, highlighting the formation of an axis of autocracies comprising Russia, China, Iran, and North Korea.

a. Formation and Strengthening of the Autocratic Axis

Yaroslav explains that:

“Russia, Iran, North Korea, all three of these are actually militarily cooperating now. And then we have China [...] as a political protector, as an economic partner, and as a source of technology for all three of these nations.”
(07:09)

b. Historical Context and Turning Points

Rewinding a decade, Yaroslav notes that collaborations between these nations were sparse, with instances of cooperation against mutual threats like Iran’s nuclear ambitions and North Korea’s provocations. However, the 2014 Russian invasion of Ukraine marked a significant turning point, leading to increased cooperation between Russia and China as both nations perceived a weakening West.

“President Xi of China, President Putin of Russia really found this common ground with the idea that the west is weak. The west is inexorably losing its position as the dominant force in the world.”
(07:42)

c. Disunity within the West

The emergence of this autocratic bloc is further compounded by internal fractures within Western democracies. Yaroslav points out:

“There are cracks within the West [...] potential for more disputes over things like trade, but also defense with European and Asian partners.”
(08:45)

This disunity threatens collective action against rising autocratic powers and could embolden the axis in their global ambitions.

d. Escalation Towards Global Conflict

Yaroslav warns of the globalization of existing conflicts:

“We already have a conflict that is globalizing. [...] thousands of North Korean troops have come to join the fight, ... learning valuable lessons about how to fight against an American equipped military.”
(09:20)

He underscores the interconnectedness of regional wars, such as the destabilization in Syria and the ongoing war in Ukraine, which collectively signal the ominous beginnings of a larger global conflict.

e. US Defense Readiness

Assessing the US’s preparedness, Yaroslav highlights a concerning decline in defense spending compared to the Cold War era:

“Back then, the US was spending anything between 6 and 16% of the GDP on defense. Now it's about 3.5%.”
(10:07)

He also points out the hesitancy of global partners like India, Saudi Arabia, and the UAE to fully commit, leaving NATO and key allies like Australia, Japan, and South Korea as the primary supporters.

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4. Domestic Issues

a. Madison School Shooting

Tragedy struck in Madison, Wisconsin, where at least two individuals were killed, and several others injured in a shooting at Abundant Life Christian School, a private K-12 institution.

Yaroslav Trofimov reflects on the long-lasting impact of such incidents:

“Every child, every person in that building is a victim and will be a victim forever. And these types of trauma don't just go away.”
(01:41)

The suspected shooter, believed to be a student, was found dead, adding another layer of complexity and sorrow to the event.

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5. Capitol Hill Developments

a. Generational Shift within the Democratic Party

On Capitol Hill, a noteworthy power struggle is unfolding as millennial and Gen X Democrats vie to supplant the longstanding baby boomer leadership. A focal point of this tussle is the potential rise of Representative Alexandria Ocasio-Cortez (AOC) to head the influential Oversight Committee.

Katie Stechferik, covering Congress for the Wall Street Journal, provides her perspective:

“If she were to win the slot over Gerry Connolly, [...] it would show that Democrats have an appetite for and restless for younger leaders, more progressive, bold vision that AOC has represented since she got here.”
(11:59)

b. Implications for Party Dynamics and Leadership

Katie further elaborates on the broader implications:

“This is part of the reflection [...] whether the Democrats will recalibrate their values and decide that seniority does matter less going forward when it comes to who is in charge and who's setting the direction for the party.”
(12:03)

This generational challenge tests the Democratic Party's willingness to embrace change and prioritize progressive leadership over traditional seniority.

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6. Market Reactions and Other News

Pierre Biename touches upon the stock market’s reaction to the day's events:

• The Dow Jones Industrial Average edged down by 0.3%.
• The S&P 500 rose by 0.4% after experiencing a decline the previous week.
• The Nasdaq Composite surged by 1.2%, reaching a new record, buoyed by tech and fast-growing companies extending their year-end rally.

Additionally, developments in Damascus are highlighted, where Abu Mohammed al Jalani, leader of a major rebel group, promises reforms but acknowledges the ongoing turmoil and displacement caused by the civil war. Contrarily, Bashar al-Assad publicly addresses his ouster for the first time since his removal, defending his tenure and role until evacuation to Russia.

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7. Conclusion

The episode paints a complex picture of a world grappling with emerging autocratic alliances, internal divisions within Western democracies, significant political and economic investments by key global players, and domestic challenges that continue to shape the national discourse. The convergence of these factors underscores the precarious state of international relations and the potential for escalating conflicts on a global scale.

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This summary omits advertisements, introductions, and outros to focus solely on the substantive content discussed in the episode.

Transcript

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[Pierre Biename]

President elect Donald Trump and the CEO of SoftBank announce a $100 billion investment in US projects and could the conflicts roiling the globe amount to the beginnings of a new world war?

[Yaroslav Trofimov]

President Xi of China, President Putin of Russia really found this common ground with the idea that the west is weak. The west is inexorably losing its position as the dominant force in the world and as a result, this axis of autocracies that the future belongs to it.

[Pierre Biename]

Plus at least two people have been killed in a school shooting in Madison, Wisconsin. It's Monday, December 16th. I'm Pierre Biename filling in for Alex Osola for the Wall Street Journal. This is the PM edition of what's the top headlines and business stories that moved the world today. At least two people were killed today and several others injured in a shooting at Abundant Life Christian School, a private K through 12 school in Madison, Wisconsin. Madison's police chief said the suspected shooter, who police believe was a student at the school, was also found dead.

[Yaroslav Trofimov]

Every child, every person in that building is a victim and will be a victim forever. And these types of trauma don't just go away.

[Pierre Biename]

And you can follow this story on WSJ.com Speaking at Mar? A Lago today, Donald Trump and SoftBank Group CEO Masayoshi Son together announced that the company plans to invest $100 billion in US projects over the next four years. The Japanese Internet and telecommunications company estimates that its Investments will create 100,000 jobs focused on AI and emerging technologies, and it plans to complete the work before Trump leaves office in 2029. National politics reporter Alex Leary was at the Mar? A Lago event where Trump also gave his first press conference since winning the election. And Alex joins me now. Alex, how significant is this announcement and this investment for Donald Trump?

[Alex Leary]

This is a big deal for Trump, at least symbolically. Early on, Trump is just about a month away from taking office and he's looking to put points on the board. And this is a very, very big showing. $100 billion is a huge amount for no matter what company. And Trump heralded this as basically saying, I'm back, America's back and the economy's gonna be great. Come invest with us. So it's a big deal for Trump now. Whether this happens to the full extent that it promised, we'll see. But for now, this is a win for Trump without question.

[Pierre Biename]

Well, in fact, how is it that SoftBank can manage to do this given the company has roughly $30 billion of cash on hand, as you report?

[Alex Leary]

That's a very big question, a very big open question. We did not get to question the CEO today. He left before the president elect took questions, so we didn't get that answered. It's certainly one that reporters and investors and others will be certainly looking to figure out because again, he has about $30 billion, according to our reporting, at his disposal. So he's going to have to more funds in order to make this work.

[Pierre Biename]

That was national politics reporter Alex Leary. And as Alex mentioned, the president elect took questions from the press after the announcement. Among other things, Trump doubled down on his use of tariffs on imports from around the world, said he would look at pardoning New York City Mayor Eric Adams, a Democrat whom federal prosecutors have charged with bribery, fraud and campaign finance offenses, and credited Turkey for Syrian rebels victory in ending the regime of Syria's now ousted president, Bashar al Assad. Trump also asserted, without citing evidence, that the US Government knows what's happening with mysterious drones that have appeared in the skies over New Jersey in recent weeks, which we discussed in this morning's show.

[Donald Trump]

The government knows what is happening. Look, our military knows where they took off from. If it's a garage, they can go right into that garage. They know where it came from and where it went and for some reason they don't want to comment and I think they'd be better off saying what it is.

[Pierre Biename]

Trump declined to say whether he had received a security briefing on the unexplained appearance of the drones in US markets today. The Dow edged down 0.3%. The S&P 500 rose 0.4% after falling last week. And the tech heavy Nasdaq composite surged 1.2% to a new record as shares of tech and other fast growing companies extended a year end rally in Damascus. The leader of one of the biggest rebel groups that routed Syrian leader Bashar al Assad is promising reform for the country, cautioning, however, that it would take time. Wearing a suit rather than military fatigues, Abu Mohammed al Jalani positioned himself as a statesman in a meeting with foreign journalists today. He said the country isn't yet ready for elections because it remains in turmoil, and many of its citizens are still displaced by the civil war. Jalani is designated a terrorist by the US government. The Federal Bureau of Investigation is offering a $10 million reward for information about him. Meanwhile, Bashar al Assad spoke out for the first time since his ouster today. The former president says he fought to the end, staying in Syria until the regime's last defenses crumbled before being evacuated to Russia. A longtime spokeswoman and several other officials close to the Assads couldn't immediately be reached for comment. Coming up, an Axis of A led by Russia, China, Iran and North Korea is challenging the democratic world order. That's after the break.

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[Pierre Biename]

Russia's war in Ukraine, the Middle east ablaze in several countries, tensions building in East Asia. Once thought to be disconnected, these conflicts have merged into what could be the opening shots of a third world war. Our chief foreign affairs correspondent, Yaroslav Trofimov, joins me now. Yaro, what is it that connects these conflicts?

[Yaroslav Trofimov]

We're really seeing the formation of an axis of autocracies now, obviously. Russia, Iran, North Korea, all three of these are actually militarily cooperating now. And then we have China, the biggest, the most powerful of them all, which is staying away from direct military involvement in all these conflicts, but is certainly indispensable as a political protector, as an economic partner, and as a source of technology for all three of these nations.

[Pierre Biename]

How is it that this autocratic axis has come together in recent years?

[Yaroslav Trofimov]

If you roll back just a decade ago, China and Russia used to work with the US and other Western nations on containing Iran's nuclear ambitions, on sanctioning North Korea as recently as 2017. But the turning point was the initial Russian invasion of Ukraine 2014, which led to mild Western sanctions, but also gave President Putin the idea that the west is not really in it for the fight and could be deterred. And that gave birth to more and more cooperation between Russia and China because China turned to a source of technology for Russia, and Russia started supplying more and more raw materials. But more importantly, President Xi of China, President Putin of Russia really found this common ground with the idea that the west is weak. The west is inexorably losing its position as the dominant force in the world. And as a result, this axis of autocracies, the future belongs to it.

[Pierre Biename]

And is the west united against these challengers?

[Yaroslav Trofimov]

We're seeing cracks within the West. We're seeing, obviously, with the election of President Trump, who assumes office in January, potential for more disputes over things like trade, but also defense with European and Asian partners. Many in Europe are very much alarmed about whether the Trump administration would strike its own deal with Russia at the expense of Ukraine and the expense of European security. So we are in a moment of disunity among the democracies and the closing of the ranks among the autocracies right now.

[Pierre Biename]

And would you say that all of this is pointing to a global conflict?

[Yaroslav Trofimov]

We already have a conflict that is globalizing. Look at what happened just in the last few months on the Ukrainian front. In Russia, thousands of North Korean troops have come to join the fight, but not only to help Russia, but also to learn valuable lessons about how to fight against an American equipped military. At the same time, if you look at what happened in Syria in recent weeks, the main reason why the regime of Bashar Al Assad collapsed is because Russia, its main patron, was distracted by the war in Ukraine, so it could not spare forces. And at the same time, Iran was too weakened by its own war against Israel over the last year. So everything is connected more and more.

[Pierre Biename]

So how is the US in particular readying for a possible conflict if we.

[Yaroslav Trofimov]

Accept that we are in a global conflict? Now, let's look back at the spending that we saw during the actual Cold War. Back then, the US was spending anything between 6 and 16% of the GDP on defense. Now it's about 3.5%. And if you look at what countries like Russia are spending, they're spending everything they can. The US has partners in many parts of the world, but they are not taking part in this. Countries like India, countries like Saudi Arabia, the uae, they are on the fence. They are mostly neutral. And so we're really talking about NATO countries in Europe and Canada, and then treaty allies like Australia, Japan and South Korea in the Pacific.

[Pierre Biename]

That was our chief foreign affairs correspondent, Yaroslav Trofimov. Yaro, thanks so much.

[Yaroslav Trofimov]

Great to be on the show.

[Pierre Biename]

On Capitol Hill, millennial and Gen X Democrats are seeking to grab power from longtime baby boomer leaders. The tussle could put Representative Alexandria Ocasio Cortez atop the influential Oversight Committee. That race is a closely watched test of the Democratic Party's appetite for generational change. After big electoral losses in November, though, they made a net gain of one seat in the Katie Stechverick covers Congress for the Wall Street Journal, and she joins me from Capitol Hill. Katie, what would an AOC victory say reflect about the Democrats strategy and the faces they're looking to put forward?

[Katie Stechferik]

It'd be mostly a symbolic move. I mean, she has been kind of the face of a younger Democratic Party, a more progressive Democratic Party. So if she were to win the slot over Gerry Connolly, who's been on the committee for a decade longer than she's been in Congress, it would show that Democrats have an appetite for and restless for younger leaders, more progressive, bold vision that AOC has represented since she got here.

[Pierre Biename]

What about the party dynamics, and where does this challenge leave the older guard?

[Katie Stechferik]

What we're seeing on the Hill this week is sort of the reflection we've seen since the election results became clear among Democrats of what kind of what does the party look like going forward. And with the election results, we expected some sort of purge, some sort of directional shift from Democrats, and this is part of that discussion. Writing about lawmakers who have a tendency to stay and a hesitancy to retire is both something that Democrats and Republicans have been having conversations on. However, when it comes to who should lead this committee in Congress, in some ways that's a uniquely Democratic problem in that the Democrats do not have term limits, Republicans do. And while this election is about putting people in different committee leadership positions, it's also a question of whether the Democrats will recalibrate their values and decide that seniority does matter less going forward when it comes to who is in charge and who's setting the direction for the party.

[Pierre Biename]

Katie Stetchferik covers Congress for the Wall Street Journal, and that's what's news for this Monday afternoon. Today's show was produced by Anthony Bancy with supervising producer Michael Kosmedes. I'm Pierre Bienname for the Wall Street Journal. We'll be back with a new show tomorrow morning. Thanks for listening.