October 29, 2025 • 38 mins
As Donald Trump continues his Asia tour, all eyes are on his upcoming meeting with China’s President Xi Jinping in South Korea on Thursday - amid a fierce trade war and fraught geopolitical backdrop.
In this week’s episode of TrumpWorld, Anushka Asthana and Matt Frei break down what we can expect from this meeting and what’s at stake; from trade deals to tech tensions
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
There are two things that DonaldTrump hates.
One is to be made to feel stupid, and the second one,
which he hates even more, is notto be cut in on a good deal,
right? So that's what he's doing when
he's going around the world cutting good deals for America,
but also, one assumes, when he can above board for himself.
Hello and welcome to this week'sedition of Trump WORLD.
(00:20):
I'm Matt Fry in London. And I'm Anushka Astana in
Washington, DC Donald Trump is in neither of our locations this
week. He is on a tour of Asia.
He has been to Malaysia. He has been to Japan.
And now, now South Korea, where tomorrow we're going to have a
big meeting between him and President Xi Jinping, and we'll
(00:42):
talk about that trade deal a lot.
But in the meantime, there's plenty of else going on, isn't
there? You bet there is.
So there was an extraordinary interview given by Steve Bannon
this week to The Economist. And Steve Bannon, as you know,
was, of course, Trump's chief strategist in the first Trump
administration. He didn't last very long.
He was sacked after, I think, six months or so.
(01:05):
And I've got a little story about that because I met him in
a hotel, in his hotel room in Rome and we spent two hours
talking to each other. And I'll tell you about that in
a minute because that was quite an interesting insight.
But anyway, the reason why we'retalking about him now is that he
gave an interview to the editor of the Economist and the deputy
editor. And he said lots of incredibly
abrasive things in that interview.
And they were quite taken aback.And they all, it was all soft
(01:27):
furnishings, fluffy sofas. And Bannon was on, on true
Bannon revolutionary form, the Rob Speer of the MAGA movement
ready to chop their heads off. And they, I, I, you know, they
dealt with it quite well, I thought.
But the thing that made the headlines was his comment that
he thinks Trump should serve, will serve, actually will serve
or should serve a third term in office.
(01:50):
What did you make of all that, Enochko?
Well, I think my general mantra with this second Trump
presidency is to take it much more seriously, as in to take
what he says more seriously, I feel Trump says.
What Bannon says. Or both.
Well, let's let's get to that because he Baron said it and
Trump has hinted at it plenty oftimes as well as occasionally
(02:11):
denying it. But even on this trip in Asia,
Donald Trump when asked about it, didn't shy away from it, was
hinting that maybe he would consider a third run.
The only thing I think he has ruled out is the idea that he
would run as vice president to JD Vance in order to find a way
through the back door in he said, you know, I don't think
voters would like that. He has said before, I don't, I
(02:34):
don't think it is, you know, allowed to do it.
But he's made clear repeatedly that he might look at ways to do
it. Now, Steve Bannon is talking
about the idea of a secret plan that they want to put in place
and has said, look, just get used to it.
Basically, Donald Trump is goingto be president again.
This would, of course, break, I think, the 22nd Amendment, which
(02:58):
most people think is not something that they should be
messing with. But it feels like they're
messing with plenty of the Constitution beyond this,
including around free speech andhow they deal with free speech.
So why wouldn't they consider this?
I mean, there is an age issue here as well as a huge
constitutional issue. If he were to run for a third
term, he'd be 86 by the time he completed that third run.
(03:21):
But I, I, I don't see any reasonwhy not to believe that Donald
Trump is interested in it and islooking for a way.
And you know, when you talk about secret plans, you know,
one thing I've been thinking about a lot this week and I'm
sure in future episodes we'll talk about it, is so-called
Project 2025, a 900 page blueprint for office that Donald
Trump once claimed he'd never heard of.
(03:42):
He then put its architects into senior positions in the White
House. And now he talks much more
proudly of it. Why shouldn't we believe both
Steve Bannon and Donald Trump that they're at least
considering this? I agree with all that.
Just a few little bit of context.
I mean, the, the idea that you run for a third term Once Upon a
time, you know, during the Second World War was completely
(04:03):
normal. FDR ran 4 consecutive terms in
office. And then after that, it was
thought that this would be too much and it would turn, you
know, make America look a littlebit too much like a kind of
dictatorship, which you could argue is what Trump wants.
What worries me about Steve Bannon in that particular
interview and having met the guytwice, is that he is a Yeah, I.
(04:24):
Want to hear about your two hourmeeting?
OK, but it was, it was an interesting meeting.
Let me just tell you about that briefly then.
So Steve Bannon had been sacked and he'd more or less
disappeared into a witness protection programme.
No one knew where the hell he was.
And I happened to be in Rome forthe Italian elections.
I think this was 2018, if I'm not mistaken.
It was March, it was rainy, it was miserable.
(04:46):
And there was a picture of SteveBannon and literally no one had
seen her in public, sort of by Plaza Novona in the centre of
Rome. And I thought, ah, OK, the guy's
in town. He's not giving interviews.
He's kept a low profile. I bet you he's staying at the
Raphael Hotel, which is a sort of Ivy clad boutique hotel next
to Piazza Navona. Anyway, I walk into the hotel
(05:07):
lobby and I say I'd like to see my old friend Steve Bannon at
that stage. I've never met the guy.
And the woman says that's room 518.
Bingo, right. And then at that moment, these
two heavies get up in the in thein the lobby.
They were clearly his bodyguardsand said, why are you here to
see Steve? I've also written this book on
Italy and I'm sure he's here forthe Italian elections and I'd
(05:28):
and I'd love to talk to him about those.
Anyway, I waited in the lobby for 10 minutes.
I was then summoned up to his room and he opened the door.
It was dark inside. And he he held out the phone,
which had the Amazon order number of my book on Italy,
Italy, the unfinished Revolutionon it.
And I promise you, Anouska, I didn't think anyone had ordered
that book in a decade, right? But he ordered it.
(05:49):
He found it, which is a very flattering thing to do.
And then he invited me in. And he was such a notorious
character at the time, even moreso than now because he was
essentially, you know, Trump's brain running this first Trump
administration. And it was a sweet.
And there was a bottle of wine that had not been opened,
although there's always something vaguely unsober about
(06:12):
the way he appears. He hadn't touched a drop of
alcohol. And I didn't drink either.
And then we spent two hours without cameras talking.
And the. So it's it's worth, you know,
giving you the build up to then describe what happened, which is
that he offloaded about Donald Trump and Jared Kushner and
Ivanka and Melania with a degreeof rudeness that would make the
(06:34):
most, you know, effervescent episodes of in the thick of it
look tame by comparison. I mean it he was dropping F
bombs like there was no tomorrow.
And he basically said Trump is more or less, you know, he
wasn't very complimentary about him.
It's off. It was off the record.
So I can't, I'm not going to quote you for him, but the
general mood of it was this guy,you know, is not as smart as he
(06:58):
thinks he is, but I'm really, really smart.
And what? But what did also come across,
and this is what came across in the Economist interview, is that
Bannon is a real revolutionary. He really genuinely believes
that America is fighting a revolution to what he calls
getting back to genuine capitalism, away from
corporatism in favour of the little guy or the average guy
(07:20):
who's been screwed by the big companies.
And of course, Bernie Sanders would, you know, heartily agree
with him on that one. So would Zoran Mandami, the guy
who's going to be the next mayorof New York, most likely.
AOC probably as well. He's a true revolutionary.
Trump running for a third term is is kind of the least of his
points. Of course he'd run for a third
term because it's a revolution that has to be completed and he
(07:42):
won't be able to get it done in the next three years.
So it's more what worries me more actually than the third
term idea that Bannon put out there is the revolutionary zeal
in this idea that America is at war with itself, that this is a
war against the so-called liberal woke elite.
Caller what you like. I mean, I think Bannon honestly,
I think is quite happy to see this come to blows, to see
(08:05):
another kind of civil war in America for his vision to
prevail. And that is deeply alarming.
I mean, as you know, Anushka, with Trump always having to
balance the stuff that he does on the global stage with the
stuff that he does at home. And the Bannon interview is very
much in the latter category. And I do think we have to look
at the first nine months of the Trump administration, let alone
(08:27):
the next three years, and what might happen afterwards as a
kind of revolutionary approach to American governance.
You know, challenging, possibly tearing up the Constitution,
taking on the big institutions of the American state, whether
it's the federal government or elite universities like Harvard.
I mean, Trump's got a lot of fighting him.
It was all announced in Project 2025.
(08:49):
And that old cliche in the firstadministration, you've got to
take him seriously but not literally is nonsense.
You've got to take him seriouslyand literally.
And of course, that is what foreign leaders are learning as
well. They're they're on a learning
curve how to deal with Donald Trump.
And this week it was the turn ofAsia and starting off for
Southeast Asia and Oshka. Yeah, What I find really
(09:10):
interesting is to watch the way foreign leaders are fawning to
Trump because they really genuinely think he can have an
influence on, you know, conflicts around the world.
And I I think that is genuine. I think they believe that he can
have. And we've seen that this week.
In fact, in Malaysia, he was there overseeing a signing of an
(09:31):
agreement between Thailand and Cambodia.
He called it a peace deal. I noticed that the Thai foreign
minister afterwards, when asked,is this a peace deal, wouldn't
actually go there. But he did talk about a pathway
to peace. We had a situation in which the
Cambodian PM said publicly, I want to nominate you for a Nobel
Peace, Peace Prize. And we're told actually by the
(09:54):
White House press secretary Caroline Levitt, that Prime
Minister Taikachi, the new PrimeMinister in Japan, has also told
Donald Trump that she too will nominate him for a Nobel Peace
Prize. Although Japan, and I think they
have history on this because I think they actually nominated
him back in 2019, they never saypublicly because they believe
the Nobel Peace Prize process says you shouldn't do that.
(10:17):
And as you say, at the same time, you know, and there's
genuine actually, I should mention Sudan as well, you know,
talking to people in the region over this week, they were saying
to me, every person involved in peacekeeping on the ground wants
to get the ear of Donald Trump. They believe genuinely that his
influence can make a difference because it actually brings both
(10:37):
sides to the table in a way thatperhaps previous people had not
done, including actually Biden when it comes to Sudan.
But at the same time as they arefawning to him all over the
world, really falling over for themselves because they know
that that's one of the things helikes.
As you say, there's sort of extraordinary things happening
in the US. And, you know, I was actually
(10:58):
talking to someone really, really senior diplomatically in
a European country this week whowas who was asking the question
genuinely. I wonder how history will judge
us for the way that we've decided to go down this path,
for the way that we've decided to suck up to him.
Because at the same time, how will history judge what is
happening here on the ground in the US and how far is he
(11:21):
prepared to go with that blueprint for power that we've
talked about now? Now, the question I also have is
how much are the people in the US focused on what he's doing
abroad, You know, even on the Israel Gaza deal, which of
course got huge headlines here. I do wonder when you're watching
quite a lot of the news channelshere, it wasn't the same level
(11:42):
of emphasis. I don't think that you perhaps
get in some parts of the world. The focus has still been more
heavily on what's happening herein the US on the shutdown, on,
you know, questions again today over President Biden's fitness
in terms of his health. You know, I noticed that was
leading Fox News this morning, not, you know, whatever he is
signing in Asia right now. That's not to say that it
(12:06):
doesn't cut through at all, but I just think, you know, how is
he playing this? It's like this completely
different character, Jekyll and Hyde, home and abroad, and what
do the Americans? It is all about the exercise of
Trump's power in different ways.So if you just look at the last
week, you know, Trump power comes in different shapes and
(12:27):
sizes. It's packaged in different ways.
So the most obvious recipient ofTrump's, you know, generosity
was one Javier Miley, the president of Argentina, who was
going to lose a midterm electionand has now won that election.
Rather, his party's won the election in a midterm election.
But it was essential for him to win it in order to continue his
(12:48):
revolutionary libertarian economic programme, a sort of
condensation of what Musk was always all about, you know, cut
down the federal government to the bone, then lower taxes,
deregulate, deregulate, deregulate.
And then the kind of animal instincts of capitalism will
take over, which is why Miley always campaigned with a
chainsaw. Well, you know, the Argentinians
(13:10):
didn't really like it very much.There was a corruption scandal
around his sister, who's also his chief of staff and his his
sort of chief social media officer, who's the third most
influential person in the whole country.
They were embroiled in a scandal.
The economy didn't do quite as well as Milay had promised.
It all went basically South. And then Trump to save his
(13:31):
friend. And he really regards Milay as a
kind of fellow revolutionary, asdoes Bannon, by the way.
Trump said, look, you know, I'm going to give you the first.
It was 20 billion. Then it was $40 billion.
You personally in Argentina to guarantee the state of the
economy and to help your peso, your currency.
But if you don't elect Milo's party, dear Argentinians, in
(13:55):
this coming election, that moneygoes.
Can you imagine? I was actually watching the
polls when they originally made that offer and, and they did
literally spike for Milo's partyafter America intervened.
And, and watching, you know, Scott Besson, the Treasury
Secretary, was also talking about that original $20 million
when Miley visited the White House and was absolutely clear
(14:18):
that basically we support your politics.
We cannot let communists, as they were saying, get in.
And we've seen a very different reaction to left wing
governments in South America. So, so let's you know in terms
of this Asia trip. I tell you, can I just add 1
little thing? You, you mentioned that you know
that everyone, everyone have you.
By the way, have you nominated him yet for a Nobel Prize?
(14:40):
Because I have, and I I don't know if you've actually done
that. And don't, don't smile so
insincerely. This.
Is important. Show me that e-mail trail.
You should. Nominate him for a prize.
We could do it together. Trump, well, nominates Trump for
a Nobel Peace Prize. But look, there must be someone,
somewhere must have written a sort of checklist of all the
things you need to do to avoid the worst treatment of Trump.
(15:01):
So nominate him for that soddingprize.
Then do what the Malaysian did Anwar Ibrahim in two interesting
things. When Trump arrived in Malaysia,
Anwar Ibrahim laid on the Malaysian Air Force as an
escort. That is a really good idea, as
long as Trump doesn't feel that those planes might collide or
shoot him down. And then, rather daringly, he
(15:22):
made a joke about Trump possiblygoing to jail.
Which was really not in the it'snot in the guidebook.
He said, of course we have something in common.
President Trump, I spent 10 years in jail and you almost
went to jail last year. I'm not sure if Trump smiled at
that stage or not. But the other thing to do is,
and this is what the Japanese Prime Minister, the newly
elected female Prime Minister ofJapan, which who Trump hailed to
(15:44):
the heavens. Did you increase defence
spending in her case to 2% of GDP, which for for Japan, you
know, a country post to Roshimi that is sort of built on the the
doctrine of peace is a massive deal.
And of course, guess who else raised defence spending before
they first went to visit Donald J Trump in the White House won
Keir Starmer raised it to whatever 2 1/2% and cut the aid
(16:08):
budget. People are doing things in
domestic policy that are contentious in order to suck up
to him. You could well whether you would
argue NATO countries raising defence spending as contentious
or not. I think it's fairly popular as
well among populations. But they're doing it.
The timing of it is all to do with him.
I mean, they were doing it anyway.
Yeah, but they're doing it more.Yeah, and, and, and unwinding
(16:31):
which bits of these are him having a positive impact on the
world and which are him having achilling impact on the world.
You know, it's quite complicated.
The NATO General Secretary General, Mark Rutter, was here
last week and I managed to speakto him in the corridors.
And he he was making the argument that it's only because
of Trump that NATO are increasing those spending
(16:53):
limits, but also saying it in a way because he knows that that's
what Trump wants to hear. Interestingly though, in Japan,
you know, lots of warm words, all the sycophancy we've seen
elsewhere, the private promise of the nomination, but actually,
actually not a trade deal, not atrade breakthrough.
They have signed a memorandum ofunderstanding.
(17:14):
There's some things in there, but this doesn't go all the way
does. It no, it doesn't.
It doesn't go all the way. And but remember also Japan was
slapped with 25% tariffs on Liberation Day.
That was then commuted down to Ithink 15% tariffs.
And but Japan, you know, Trump always has always really liked
Japan. And he loved as much as Trump
(17:35):
can love any foreign leader. He loved Shinzo Abe, the late
Japanese leader, Prime Minister,who was mentored to the current
new Japanese Prime Minister. He adored Abe.
Abe was constantly over at Mar aLago, not on official visits,
but to play golf with Trump. They really hit it off with each
other. And remember also that she
rather like Abe himself, it's very conservative.
(17:56):
You know, she styles herself as the Iron Lady of Japan.
Her big model is Margaret Thatcher.
She wears Blue Jackets and big pearls like Maggie did.
And you know, of course, you know, Trump's got nice things,
very nice things to say about Margaret Thatcher.
So I think ideologically they are aligned.
She has done the right thing on defence spending.
She's also promised to spend, I think it's 100 billion U.S.
(18:19):
dollars on American defence equipment, which is always, you
know, another part of the kind of the Trump welcoming package.
And crucially, and this was the kind of point of the Southeast
Asian tour, what Trump is tryingto do, having basically burned
quite a few Asian bridges after Liberation Day, is trying to
rebuild those bridges on his ownterms so that he can re stitch
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what used to be quite ineffective, what they call the
Alliance of Islands, the ring ofislands around China.
It's about containing China. And if you want to contain
China, and we'll get to China ina minute, you've got to get on
with the Japanese. You've got to get on with the
South Koreans. And you've really got to get on
with all those, you know, Southeast Asian factory nations
that have been producing, you know, Nikes sneakers and various
(19:03):
other things and selling them very cheaply to the US.
And they're really in a bind because they don't they don't
trust China because China is their regional behemoth.
And they used to really trust the US after the Vietnam War,
but let's not talk about that. They used to really trust the US
And the US was buying all their stuff, and then suddenly the US
turned against them. So Trump has a problem in that
(19:25):
he's burning. He's been burning so many
bridges, and he's now trying to rebuild them, but on
transactional Trump terms. And I just wonder whether that
kind of alliance will in the end, be enough to contain China
because, of course, China makes a lot of the stuff in those
countries in Southeast Asia. That's the circle.
China plus one policy to get around American sanctions.
(19:47):
So this, you know, But what Trump has realized at the very
least, is that when it comes to,you know, the pulse of the world
economy, it ain't in Europe, it's in Asia.
Yeah. Let's talk about the meeting
with XI just before we go into it in detail.
I just think it is worth saying from what you've been saying
there, and I think this every time I hear about Trump's
(20:09):
relations with countries all over the world, you've always
got to notice that the economic of interests of America, even in
these peace agreements, is absolutely what that is going in
for. Making a deal like even, you
know, the conflicts which at theend have mining contracts that
America is going to benefit fromand so on, which is why those in
(20:30):
parts of the world that don't have massive economic interests
are concerned because they don'thave it.
Now, what China has in spades isthings that America wants and
that has been causing problems for Donald Trump as he's
triggered the possibility of a trade war.
Over the, you know, preceding months, he's talked about 100%
tariffs on China. He's got a problem because China
(20:53):
has stopped buying soya beans from American farmers, and that
has caused a bit of a crisis here in the US And secondly,
China has almost all of the world's rare earth minerals,
which we need for the electronics that are so
important here in the US. They're talking about the
framework of a deal. How do you feel this meeting's
going to go, Matt? Well, what's so interesting
(21:14):
about the China meeting is that,first of all, it's a bit late in
coming. I mean, they should have had a
meeting much earlier, but there's been so much shadow
boxing and there's been such a kind of trade war between the
two of them. It's been virtually impossible
so far. Before we get to the, I want to
have, I have a lot to say about China and I know reasonable.
(21:34):
I used to be based in Asia. I went to China.
You know, I did Mandarin at school when I was 18 and I went
to China for three months in 1981 by myself.
I was the loneliest person I've ever met.
Shenzhen, which is now a mega city of 26,000,000, was then a
city, a town actually, of 10,000people.
(21:54):
Anyway, just briefly, Bannon, what Bannon said to me in in my
meeting with him in Rome is thatthe two things that Donald Trump
hates, one is to be made to feelstupid.
And the second one, which he hates even more, is not to be
cut in on a good deal, right? So that's what he's doing when
he's going around the world cutting good deals for America,
but also one assumes when he canabove board for himself.
(22:17):
Now with China, he thought back on Liberation Day that, you
know, looking at the trade balance, the Chinese sellers
five times as many things as we sell them, that he had the way
he wanted them. That, you know, he could
increase tariffs. And the initial stages, it was
like, I think 45%. And they would bow to his
greater will. Except the Chinese, having
(22:38):
tasted some of Trump's trade tariff eye in the first
administration, has spent the last five years getting ready
for the next round of Trump tariffs, which did not hit them
with any surprise. And what they knew they had that
American doesn't just want but needs is not just the rare earth
metals, but also pharmaceutical products.
(22:59):
There were 700 pharmaceutical products that cover everything
from cancer to allergies, you know, to, you know, heart
medicine. Some of it Trump might be on
himself, you know, and if you live in America, it's nothing
but medical ads on television. 700 of these antibiotics, 700 of
these can only be made because China is selling America the
(23:23):
chemicals in order, the pharmaceutical products in order
to make those things. That's on top of the rare earth
metals, which we've talked abouta lot recently, which go into
everything from smartphones to F30 fives, you know, everything
in America that is kind of digital and moves has got, you
know, a rare earth metal in it. Now, why are the Americans not
making the stuff themselves? Well, they used to make it in
(23:46):
the in the early noughties, America had two big rare earth,
you know, mines, I think one in Arizona, one in New Mexico.
But then they weren't making a lot of money because the Chinese
were making the stuff more cheaply.
And also they're very dirty to mine.
And in China they don't really give a stuff about the
environment. Whereas in America you kind of,
they do, oddly enough, they did,they did well, they, they did,
(24:08):
you know, even when it was Jewel, baby Jewel, they still
did. And so the Americans, like so
much else, outsourced this to China because it was cheaper and
there was a very efficient production and delivery line.
And of course, that put the Chinese in a position where they
are literally, they don't just mine 65% of rare earths, they
process 90% of the stuff. So one of the other deals that
(24:32):
he's discussing with Japan is how to mine rare earth metals.
I don't know if Japan has them. Actually, lots of countries do,
Ukraine included and how to process them.
So and, and of course, where he's right is that everyone else
and in Asia, they're more afraidof China than they are in the US
because they know what China feels like up close and
personal. He's got a sort of coalition of
(24:52):
the winning going on trying to get a rare earths out of the
soil and process them. And Australia is also part of
that deal. But that's but what he but for
him, he didn't really take that into account.
He thought if we stop buying theBarbie dolls that they make, and
by the way, they're not making them anymore because they're now
made in Vietnam, then they will hurt so much that they will just
(25:13):
buckle. And he was wrong on one thing,
though. I think we have to be, you know,
we have to be fair, not to him necessarily, but to the balance
of this trade war. Yes, the Chinese have the
Americans by the short and curlies on rare earth metals and
pharmaceuticals, but China is inthe middle of a major
manufacturing bubble. They had a housing bubble until
(25:36):
about 3 years ago, which was in is still in danger of bursting
catastrophically. You know, 10s of millions of
Chinese, formerly farmers now, now factory workers or clerks
bought flats that they thought worth was, were worth something
and they're not worth that anymore.
And that they're kind of knee deep in mortgages.
And so the along comes this ideafrom Xi Jinping.
(25:59):
We've got to build up our factory capacity.
We have to become the world's manufacturing hub, which is
indeed what they've done. You want to build anything, you
build it cheaper and faster and more efficiently in China than
anywhere else on the planet. But this capacity has to go
somewhere. They've got to sell the stuff
they make. And if America isn't buying that
anymore, it'll help. It'll hurt American consumers
(26:21):
because their Barbie dolls or their television sets or fridges
will be more expensive. And they weren't like that.
But it'll really hurt China as well.
Yeah. So both sides have a massive
motivation to try to come to some sort of deal.
I'm not sure if Donald Trump wasquite aware of the size of the
motivation on his side, as you say.
(26:42):
And look, I always find with allof this is, you know, people
might not believe that the way he's gone about tariffs is the
right way to go about it. And clearly tariffs are going to
impose a cost, a financial cost on American consumers.
But also, is there an underlyingargument there which isn't
untrue, which is, you know, whenyou talked about the idea that,
(27:05):
you know, they decided to take the rare earth minerals all from
China and many of these other goods, you know, you know, you
could argue that was because China was using cheap labour to
buy these goods rather, you know, to make these goods rather
than a comparative advantage in the way economists would
originally and purely have talked about it.
So I think the issue here is, and I find this in America,
(27:26):
there's no big outcry about Trump's tariffs at the moment,
partly because I think people sort of by his underlying
argument for it. The question is if and when the
prices start to rise at a level.But it's really quite painful.
I think that's huge because I think that was one of the
biggest factors in the last election.
And I think it's hard to get around that basically.
(27:47):
Absolutely, and especially for people who are, you know, who
don't earn a lot of money, inflation hits low income
families much harder than others.
But the other thing is that remember the the China tariffs
haven't actually kicked in yet because they've been kicked into
the long grass. So any inflation resulting from
China towers we won't have seen yet.
We, we will get to see that nextyear.
And the other really fascinatingthing about Trump is it like so
(28:10):
much in the world, he's, he's sort of 100 years behind
everyone else. So he's obsessed with American
manufacturing and reviving American manufacturing.
Like, you know, in the good old days of Bethlehem Steel and you
know, all these big company, youknow, all the early days of the,
of the, of the car, the car companies, the car giants.
But of course, he doesn't take into account and rarely talks
about automation. So if you're a company that
(28:31):
can't produce stuff cheaply in China, you produce it in America
with robots and with AI and, andyou're still not going to give
those poor American workers their jobs back.
The other thing is that he regards tariffs very much as
what they used to be literally 100 years ago when the
government, the federal government of Washington made
much more money from tariffs with other countries than it did
(28:53):
from taxes. There was, there was virtually
no income tax that people collected that the federal
government collected in those days, but there was quite a lot
of money, more money that they collected by charging people who
wanted to trade with America. So again, I don't know what he's
reading, you know, or if he's reading or who he's listening
to. He's got a very 19th century
mindset, not just about how power works on the world stage,
(29:15):
but also how the economy or the economic cookie crumbles.
And, you know, and at the same time, yes, he, you know, he,
he's interested in AI and he's fascinated by all that.
And he's trying to bring lots ofmoney into America to make sure
that, you know, they, they, theystay ahead of the game.
But even on that one, you remember, you know, the
(29:35):
Americans picked a war with Huawei, the electronics giant in
China that makes mobile phones, but now also makes cars.
And the idea was from the first Trump administration, you kill
off Huawei because we don't trust them, because they're a
Chinese company trying to encroach on our markets.
And you do this by denying them American made microchips.
Well, guess what? The Chinese then made their own
(29:56):
chips. They made them just as well, but
a lot more cheaply. And Huawei instead of dying has
become this resurgent, you know,digital era phone company turned
car company empire that is extraordinarily successful.
And so you mess with the Chineseat your peril.
And and the Chinese are very good at using the government,
(30:18):
the central government, either with tax incentives or
regulations to basically allow Chinese companies not just to
succeed, but also to fail and not be punished for it.
And so the idea to getting back to rare earth metals in America,
it's all down to the free marketcompany mines rare earth metals.
They're not making a ton of money out of it.
They find it easier if they do that in China.
(30:40):
The Chinese set up rare earth metal mining companies left,
right and centre. They allow four out of the 10
they've set up to go to the wall.
The other six thrive. They don't give a stuff about
the environment and then and then.
So it's Chinese industrial policy combined with free market
capitalism, that and, and an equal and a legal structure that
(31:02):
allows companies to to fail without too much punishment or
to thrive, you know, and they'verelatively low tax rate.
I mean, they've basically taken America's capitalist game and
beaten them at it. And Trump hates that.
He hates it. One thing I do wonder about what
we're going to see out of this agreement that we'll see
(31:22):
tomorrow and the meeting is it'sall based on fixing smaller
sectoral issues. So there'll be an agreement on
soya beans and there'll be an agreement on rare earth
minerals, which will stop China from going ahead with a plan to
halt exports or control exports to the US.
But actually, the question of trade between China and the US
(31:45):
is a much bigger one. It's one that has massive
implications for the entire world because of the size of the
two economies. It is one that actually, you
know, goes back decades. You know, America has never been
happy since China was part of the World Trade Organization.
Never thought it played by the rules in a fairway.
That's right to a good point. They cheated, yeah.
(32:06):
And, and so is, is a kind of agreement which is very focused
on individual sectoral issues actually going to fix the really
big tension between these countries?
And, and just as we're talking about this, China is the third
biggest exporter into the US youknow, Canada is above it.
And I just want to talk very briefly about what's happened in
(32:27):
Canada, because it is so interesting.
So the Ontario government put out an advert in which they
essentially played the voice of former President Ronald Reagan,
obviously a hero to many on the right in America, talking about
the need for free trade and how tariffs really hurt people and
how they hurt American consumersand they hurt jobs and so on.
(32:51):
And there was a complaint by an organization sort of set up in
Ronald Reagan's name that it hadmisinterpreted what Ronald
Reagan had actually stood for, missed out the context.
Donald Trump got angry about it and slapped additional tariffs
on Canada as a result of all of this.
And I just yesterday, I went back and I watched the original
(33:12):
radio delivery. It was radio, but it was also
filmed of Ronald Reagan and watched it to see whether it was
in context. And it was so interesting to
listen to it. It is true that the context was
that they had put tariffs on a few individual things with Japan
at the time, because there was avery specific argument to do it.
And what Ronald Reagan was trying to argue was there was a
(33:33):
really specific reason why I'm doing this.
But let me be clear. I believe in free trade on the
whole. I mean, the radio address, if
people were to go and listen to it, is stronger than the Ontario
advert. It is basically saying tariffs
hurt people, they hurt our people, they hurt our consumers,
they hurt our workers. And we should never go down the
(33:55):
line of trying to trigger a trade war because if we do,
gosh, the consequences will be huge.
It's fascinating. I never knew that Trump would
take Reagan quite so seriously, or rather want to protect him so
much. Or whatever it is.
I just just before we go really important on Xi Jinping meeting
Donald Trump there, there's something puzzling about Donald,
(34:15):
Donald Trump's attitude to China.
And I knew that he, he's been wary of China for a long time
because when I interviewed him back in 2013 and I said you
don't pick a fight with your banker China, that stage was the
biggest buyer of U.S. Treasury bills.
He called me stupid to my face, which is of course, a golden
moment. You want to be called stupid by
Donald Trump, but he really likes Xi Jinping.
He really admires him and he's been quite open about it.
(34:38):
But he's very wary of China and sees China as the global
competitor, America competitor to America, probably accurately.
I think that that is definitely what's happening right here.
But this love affair with Xi Jinping is really interesting.
And what I worry about on behalfof Taiwan, remember Taiwan is
that this, you know, this plucky, very wealthy island
(34:59):
nation that by the way, produces90% of the fastest
superconductor chips that are used anywhere, you know, from
fighter jets to refrigerators, you know, they, they're produced
in Taiwan. So Taiwan also has something
that everyone else needs and wants, but Taiwan doesn't want
(35:19):
to be part of China. The, the president of Taiwan who
was recently elected is more anti Chinese or anti the idea of
reunification than the previous one was.
And So what does Trump do here? Does he do what Biden did?
Who actually went out of his wayto say, I'm going to defend
Taiwan, China, if you attack Taiwan, moving away from the
(35:40):
policy of constructive ambiguity, which kept the the
Chinese guessing. Or does he say, as he did to Joe
Rogan in the election campaign, why are we protecting all these
people who stole our US chip technology?
Right. That made Taiwanese faces
blanche when they heard that. Because it's quite possible in a
(36:01):
transactional frame of mind thatTrump will say, OK, I'll do a
deal with China. What does China really want from
Trump other than its markets? It wants its hands off Taiwan.
And if America stands away from Taiwan, it'll be so much easier
for the Chinese, the People's Liberation Army, to try and
invade the island and take it over, which is a very difficult
(36:21):
and costly exercise, More difficult arguably than than
invading Ukraine because it's anisland with a very high
coastline. And the Taiwanese are very
motivated to fight back. Like the, like the Ukrainians.
They have, you know, quite a good army.
You know, they can take out Chinese ships coming their way,
etcetera, etcetera. It would be a very, very costly
thing to do. And Xi Jinping doesn't trust the
(36:43):
People's Liberation Army to do it well enough to do it
relatively bloodlessly. But that is his big ticket item.
And if Donald Trump is part of atrade deal, since even just
gives the Chinese the green light, that makes them think
that he may just stand to one side because he doesn't give a
damn about principles of democracy and freedom.
(37:03):
You know, that's irrelevant. It's about hemispheric power.
Then Taiwan is in big trouble. And that is where we then get
into a an incredibly nervous situation for Asia and possibly
for all of us if he suddenly changes his mind and says, well,
actually, I know you've started to invade Taiwan or you've got a
military blockade going on. But actually I do want to
protect them, either because I need their microchips or because
(37:26):
I I respect what they do. I respect them as a democracy.
We don't know. So this is a major point of
friction that they may try and sort out in their meeting in
South Korea, but they may actually just create more
trouble for further down the line.
Well, we'll all be watching veryclosely when these two leaders
meet tomorrow. It could have massive
ramifications for the world. That's all we've got time for
(37:49):
this week on Trump WORLD. I'm Anish Kristana here in
Washington, DC. I'm Matt Fry in London, goodbye
from the two of us and I hope you enjoyed it.
See you next week. See you next week.
There are two things that DonaldTrump hates.
One is to be made to feel stupid, and the second one,
which he hates even more, is notto be cut in on a good deal,
right? So that's what he's doing when
he's going around the world cutting good deals for America,
but also, one assumes, when he can above board for himself.
Hello and welcome to this week'sedition of Trump WORLD.
(00:20):
I'm Matt Fry in London. And I'm Anushka Astana in
Washington, DC Donald Trump is in neither of our locations this
week. He is on a tour of Asia.
He has been to Malaysia. He has been to Japan.
And now, now South Korea, where tomorrow we're going to have a
big meeting between him and President Xi Jinping, and we'll
(00:42):
talk about that trade deal a lot.
But in the meantime, there's plenty of else going on, isn't
there? You bet there is.
So there was an extraordinary interview given by Steve Bannon
this week to The Economist. And Steve Bannon, as you know,
was, of course, Trump's chief strategist in the first Trump
administration. He didn't last very long.
He was sacked after, I think, six months or so.
(01:05):
And I've got a little story about that because I met him in
a hotel, in his hotel room in Rome and we spent two hours
talking to each other. And I'll tell you about that in
a minute because that was quite an interesting insight.
But anyway, the reason why we'retalking about him now is that he
gave an interview to the editor of the Economist and the deputy
editor. And he said lots of incredibly
abrasive things in that interview.
And they were quite taken aback.And they all, it was all soft
(01:27):
furnishings, fluffy sofas. And Bannon was on, on true
Bannon revolutionary form, the Rob Speer of the MAGA movement
ready to chop their heads off. And they, I, I, you know, they
dealt with it quite well, I thought.
But the thing that made the headlines was his comment that
he thinks Trump should serve, will serve, actually will serve
or should serve a third term in office.
(01:50):
What did you make of all that, Enochko?
Well, I think my general mantra with this second Trump
presidency is to take it much more seriously, as in to take
what he says more seriously, I feel Trump says.
What Bannon says. Or both.
Well, let's let's get to that because he Baron said it and
Trump has hinted at it plenty oftimes as well as occasionally
(02:11):
denying it. But even on this trip in Asia,
Donald Trump when asked about it, didn't shy away from it, was
hinting that maybe he would consider a third run.
The only thing I think he has ruled out is the idea that he
would run as vice president to JD Vance in order to find a way
through the back door in he said, you know, I don't think
voters would like that. He has said before, I don't, I
(02:34):
don't think it is, you know, allowed to do it.
But he's made clear repeatedly that he might look at ways to do
it. Now, Steve Bannon is talking
about the idea of a secret plan that they want to put in place
and has said, look, just get used to it.
Basically, Donald Trump is goingto be president again.
This would, of course, break, I think, the 22nd Amendment, which
(02:58):
most people think is not something that they should be
messing with. But it feels like they're
messing with plenty of the Constitution beyond this,
including around free speech andhow they deal with free speech.
So why wouldn't they consider this?
I mean, there is an age issue here as well as a huge
constitutional issue. If he were to run for a third
term, he'd be 86 by the time he completed that third run.
(03:21):
But I, I, I don't see any reasonwhy not to believe that Donald
Trump is interested in it and islooking for a way.
And you know, when you talk about secret plans, you know,
one thing I've been thinking about a lot this week and I'm
sure in future episodes we'll talk about it, is so-called
Project 2025, a 900 page blueprint for office that Donald
Trump once claimed he'd never heard of.
(03:42):
He then put its architects into senior positions in the White
House. And now he talks much more
proudly of it. Why shouldn't we believe both
Steve Bannon and Donald Trump that they're at least
considering this? I agree with all that.
Just a few little bit of context.
I mean, the, the idea that you run for a third term Once Upon a
time, you know, during the Second World War was completely
(04:03):
normal. FDR ran 4 consecutive terms in
office. And then after that, it was
thought that this would be too much and it would turn, you
know, make America look a littlebit too much like a kind of
dictatorship, which you could argue is what Trump wants.
What worries me about Steve Bannon in that particular
interview and having met the guytwice, is that he is a Yeah, I.
(04:24):
Want to hear about your two hourmeeting?
OK, but it was, it was an interesting meeting.
Let me just tell you about that briefly then.
So Steve Bannon had been sacked and he'd more or less
disappeared into a witness protection programme.
No one knew where the hell he was.
And I happened to be in Rome forthe Italian elections.
I think this was 2018, if I'm not mistaken.
It was March, it was rainy, it was miserable.
(04:46):
And there was a picture of SteveBannon and literally no one had
seen her in public, sort of by Plaza Novona in the centre of
Rome. And I thought, ah, OK, the guy's
in town. He's not giving interviews.
He's kept a low profile. I bet you he's staying at the
Raphael Hotel, which is a sort of Ivy clad boutique hotel next
to Piazza Navona. Anyway, I walk into the hotel
(05:07):
lobby and I say I'd like to see my old friend Steve Bannon at
that stage. I've never met the guy.
And the woman says that's room 518.
Bingo, right. And then at that moment, these
two heavies get up in the in thein the lobby.
They were clearly his bodyguardsand said, why are you here to
see Steve? I've also written this book on
Italy and I'm sure he's here forthe Italian elections and I'd
(05:28):
and I'd love to talk to him about those.
Anyway, I waited in the lobby for 10 minutes.
I was then summoned up to his room and he opened the door.
It was dark inside. And he he held out the phone,
which had the Amazon order number of my book on Italy,
Italy, the unfinished Revolutionon it.
And I promise you, Anouska, I didn't think anyone had ordered
that book in a decade, right? But he ordered it.
(05:49):
He found it, which is a very flattering thing to do.
And then he invited me in. And he was such a notorious
character at the time, even moreso than now because he was
essentially, you know, Trump's brain running this first Trump
administration. And it was a sweet.
And there was a bottle of wine that had not been opened,
although there's always something vaguely unsober about
(06:12):
the way he appears. He hadn't touched a drop of
alcohol. And I didn't drink either.
And then we spent two hours without cameras talking.
And the. So it's it's worth, you know,
giving you the build up to then describe what happened, which is
that he offloaded about Donald Trump and Jared Kushner and
Ivanka and Melania with a degreeof rudeness that would make the
(06:34):
most, you know, effervescent episodes of in the thick of it
look tame by comparison. I mean it he was dropping F
bombs like there was no tomorrow.
And he basically said Trump is more or less, you know, he
wasn't very complimentary about him.
It's off. It was off the record.
So I can't, I'm not going to quote you for him, but the
general mood of it was this guy,you know, is not as smart as he
(06:58):
thinks he is, but I'm really, really smart.
And what? But what did also come across,
and this is what came across in the Economist interview, is that
Bannon is a real revolutionary. He really genuinely believes
that America is fighting a revolution to what he calls
getting back to genuine capitalism, away from
corporatism in favour of the little guy or the average guy
(07:20):
who's been screwed by the big companies.
And of course, Bernie Sanders would, you know, heartily agree
with him on that one. So would Zoran Mandami, the guy
who's going to be the next mayorof New York, most likely.
AOC probably as well. He's a true revolutionary.
Trump running for a third term is is kind of the least of his
points. Of course he'd run for a third
term because it's a revolution that has to be completed and he
(07:42):
won't be able to get it done in the next three years.
So it's more what worries me more actually than the third
term idea that Bannon put out there is the revolutionary zeal
in this idea that America is at war with itself, that this is a
war against the so-called liberal woke elite.
Caller what you like. I mean, I think Bannon honestly,
I think is quite happy to see this come to blows, to see
(08:05):
another kind of civil war in America for his vision to
prevail. And that is deeply alarming.
I mean, as you know, Anushka, with Trump always having to
balance the stuff that he does on the global stage with the
stuff that he does at home. And the Bannon interview is very
much in the latter category. And I do think we have to look
at the first nine months of the Trump administration, let alone
(08:27):
the next three years, and what might happen afterwards as a
kind of revolutionary approach to American governance.
You know, challenging, possibly tearing up the Constitution,
taking on the big institutions of the American state, whether
it's the federal government or elite universities like Harvard.
I mean, Trump's got a lot of fighting him.
It was all announced in Project 2025.
(08:49):
And that old cliche in the firstadministration, you've got to
take him seriously but not literally is nonsense.
You've got to take him seriouslyand literally.
And of course, that is what foreign leaders are learning as
well. They're they're on a learning
curve how to deal with Donald Trump.
And this week it was the turn ofAsia and starting off for
Southeast Asia and Oshka. Yeah, What I find really
(09:10):
interesting is to watch the way foreign leaders are fawning to
Trump because they really genuinely think he can have an
influence on, you know, conflicts around the world.
And I I think that is genuine. I think they believe that he can
have. And we've seen that this week.
In fact, in Malaysia, he was there overseeing a signing of an
(09:31):
agreement between Thailand and Cambodia.
He called it a peace deal. I noticed that the Thai foreign
minister afterwards, when asked,is this a peace deal, wouldn't
actually go there. But he did talk about a pathway
to peace. We had a situation in which the
Cambodian PM said publicly, I want to nominate you for a Nobel
Peace, Peace Prize. And we're told actually by the
(09:54):
White House press secretary Caroline Levitt, that Prime
Minister Taikachi, the new PrimeMinister in Japan, has also told
Donald Trump that she too will nominate him for a Nobel Peace
Prize. Although Japan, and I think they
have history on this because I think they actually nominated
him back in 2019, they never saypublicly because they believe
the Nobel Peace Prize process says you shouldn't do that.
(10:17):
And as you say, at the same time, you know, and there's
genuine actually, I should mention Sudan as well, you know,
talking to people in the region over this week, they were saying
to me, every person involved in peacekeeping on the ground wants
to get the ear of Donald Trump. They believe genuinely that his
influence can make a difference because it actually brings both
(10:37):
sides to the table in a way thatperhaps previous people had not
done, including actually Biden when it comes to Sudan.
But at the same time as they arefawning to him all over the
world, really falling over for themselves because they know
that that's one of the things helikes.
As you say, there's sort of extraordinary things happening
in the US. And, you know, I was actually
(10:58):
talking to someone really, really senior diplomatically in
a European country this week whowas who was asking the question
genuinely. I wonder how history will judge
us for the way that we've decided to go down this path,
for the way that we've decided to suck up to him.
Because at the same time, how will history judge what is
happening here on the ground in the US and how far is he
(11:21):
prepared to go with that blueprint for power that we've
talked about now? Now, the question I also have is
how much are the people in the US focused on what he's doing
abroad, You know, even on the Israel Gaza deal, which of
course got huge headlines here. I do wonder when you're watching
quite a lot of the news channelshere, it wasn't the same level
(11:42):
of emphasis. I don't think that you perhaps
get in some parts of the world. The focus has still been more
heavily on what's happening herein the US on the shutdown, on,
you know, questions again today over President Biden's fitness
in terms of his health. You know, I noticed that was
leading Fox News this morning, not, you know, whatever he is
signing in Asia right now. That's not to say that it
(12:06):
doesn't cut through at all, but I just think, you know, how is
he playing this? It's like this completely
different character, Jekyll and Hyde, home and abroad, and what
do the Americans? It is all about the exercise of
Trump's power in different ways.So if you just look at the last
week, you know, Trump power comes in different shapes and
(12:27):
sizes. It's packaged in different ways.
So the most obvious recipient ofTrump's, you know, generosity
was one Javier Miley, the president of Argentina, who was
going to lose a midterm electionand has now won that election.
Rather, his party's won the election in a midterm election.
But it was essential for him to win it in order to continue his
(12:48):
revolutionary libertarian economic programme, a sort of
condensation of what Musk was always all about, you know, cut
down the federal government to the bone, then lower taxes,
deregulate, deregulate, deregulate.
And then the kind of animal instincts of capitalism will
take over, which is why Miley always campaigned with a
chainsaw. Well, you know, the Argentinians
(13:10):
didn't really like it very much.There was a corruption scandal
around his sister, who's also his chief of staff and his his
sort of chief social media officer, who's the third most
influential person in the whole country.
They were embroiled in a scandal.
The economy didn't do quite as well as Milay had promised.
It all went basically South. And then Trump to save his
(13:31):
friend. And he really regards Milay as a
kind of fellow revolutionary, asdoes Bannon, by the way.
Trump said, look, you know, I'm going to give you the first.
It was 20 billion. Then it was $40 billion.
You personally in Argentina to guarantee the state of the
economy and to help your peso, your currency.
But if you don't elect Milo's party, dear Argentinians, in
(13:55):
this coming election, that moneygoes.
Can you imagine? I was actually watching the
polls when they originally made that offer and, and they did
literally spike for Milo's partyafter America intervened.
And, and watching, you know, Scott Besson, the Treasury
Secretary, was also talking about that original $20 million
when Miley visited the White House and was absolutely clear
(14:18):
that basically we support your politics.
We cannot let communists, as they were saying, get in.
And we've seen a very different reaction to left wing
governments in South America. So, so let's you know in terms
of this Asia trip. I tell you, can I just add 1
little thing? You, you mentioned that you know
that everyone, everyone have you.
By the way, have you nominated him yet for a Nobel Prize?
(14:40):
Because I have, and I I don't know if you've actually done
that. And don't, don't smile so
insincerely. This.
Is important. Show me that e-mail trail.
You should. Nominate him for a prize.
We could do it together. Trump, well, nominates Trump for
a Nobel Peace Prize. But look, there must be someone,
somewhere must have written a sort of checklist of all the
things you need to do to avoid the worst treatment of Trump.
(15:01):
So nominate him for that soddingprize.
Then do what the Malaysian did Anwar Ibrahim in two interesting
things. When Trump arrived in Malaysia,
Anwar Ibrahim laid on the Malaysian Air Force as an
escort. That is a really good idea, as
long as Trump doesn't feel that those planes might collide or
shoot him down. And then, rather daringly, he
(15:22):
made a joke about Trump possiblygoing to jail.
Which was really not in the it'snot in the guidebook.
He said, of course we have something in common.
President Trump, I spent 10 years in jail and you almost
went to jail last year. I'm not sure if Trump smiled at
that stage or not. But the other thing to do is,
and this is what the Japanese Prime Minister, the newly
elected female Prime Minister ofJapan, which who Trump hailed to
(15:44):
the heavens. Did you increase defence
spending in her case to 2% of GDP, which for for Japan, you
know, a country post to Roshimi that is sort of built on the the
doctrine of peace is a massive deal.
And of course, guess who else raised defence spending before
they first went to visit Donald J Trump in the White House won
Keir Starmer raised it to whatever 2 1/2% and cut the aid
(16:08):
budget. People are doing things in
domestic policy that are contentious in order to suck up
to him. You could well whether you would
argue NATO countries raising defence spending as contentious
or not. I think it's fairly popular as
well among populations. But they're doing it.
The timing of it is all to do with him.
I mean, they were doing it anyway.
Yeah, but they're doing it more.Yeah, and, and, and unwinding
(16:31):
which bits of these are him having a positive impact on the
world and which are him having achilling impact on the world.
You know, it's quite complicated.
The NATO General Secretary General, Mark Rutter, was here
last week and I managed to speakto him in the corridors.
And he he was making the argument that it's only because
of Trump that NATO are increasing those spending
(16:53):
limits, but also saying it in a way because he knows that that's
what Trump wants to hear. Interestingly though, in Japan,
you know, lots of warm words, all the sycophancy we've seen
elsewhere, the private promise of the nomination, but actually,
actually not a trade deal, not atrade breakthrough.
They have signed a memorandum ofunderstanding.
(17:14):
There's some things in there, but this doesn't go all the way
does. It no, it doesn't.
It doesn't go all the way. And but remember also Japan was
slapped with 25% tariffs on Liberation Day.
That was then commuted down to Ithink 15% tariffs.
And but Japan, you know, Trump always has always really liked
Japan. And he loved as much as Trump
(17:35):
can love any foreign leader. He loved Shinzo Abe, the late
Japanese leader, Prime Minister,who was mentored to the current
new Japanese Prime Minister. He adored Abe.
Abe was constantly over at Mar aLago, not on official visits,
but to play golf with Trump. They really hit it off with each
other. And remember also that she
rather like Abe himself, it's very conservative.
(17:56):
You know, she styles herself as the Iron Lady of Japan.
Her big model is Margaret Thatcher.
She wears Blue Jackets and big pearls like Maggie did.
And you know, of course, you know, Trump's got nice things,
very nice things to say about Margaret Thatcher.
So I think ideologically they are aligned.
She has done the right thing on defence spending.
She's also promised to spend, I think it's 100 billion U.S.
(18:19):
dollars on American defence equipment, which is always, you
know, another part of the kind of the Trump welcoming package.
And crucially, and this was the kind of point of the Southeast
Asian tour, what Trump is tryingto do, having basically burned
quite a few Asian bridges after Liberation Day, is trying to
rebuild those bridges on his ownterms so that he can re stitch
(18:40):
what used to be quite ineffective, what they call the
Alliance of Islands, the ring ofislands around China.
It's about containing China. And if you want to contain
China, and we'll get to China ina minute, you've got to get on
with the Japanese. You've got to get on with the
South Koreans. And you've really got to get on
with all those, you know, Southeast Asian factory nations
that have been producing, you know, Nikes sneakers and various
(19:03):
other things and selling them very cheaply to the US.
And they're really in a bind because they don't they don't
trust China because China is their regional behemoth.
And they used to really trust the US after the Vietnam War,
but let's not talk about that. They used to really trust the US
And the US was buying all their stuff, and then suddenly the US
turned against them. So Trump has a problem in that
(19:25):
he's burning. He's been burning so many
bridges, and he's now trying to rebuild them, but on
transactional Trump terms. And I just wonder whether that
kind of alliance will in the end, be enough to contain China
because, of course, China makes a lot of the stuff in those
countries in Southeast Asia. That's the circle.
China plus one policy to get around American sanctions.
(19:47):
So this, you know, But what Trump has realized at the very
least, is that when it comes to,you know, the pulse of the world
economy, it ain't in Europe, it's in Asia.
Yeah. Let's talk about the meeting
with XI just before we go into it in detail.
I just think it is worth saying from what you've been saying
there, and I think this every time I hear about Trump's
(20:09):
relations with countries all over the world, you've always
got to notice that the economic of interests of America, even in
these peace agreements, is absolutely what that is going in
for. Making a deal like even, you
know, the conflicts which at theend have mining contracts that
America is going to benefit fromand so on, which is why those in
(20:30):
parts of the world that don't have massive economic interests
are concerned because they don'thave it.
Now, what China has in spades isthings that America wants and
that has been causing problems for Donald Trump as he's
triggered the possibility of a trade war.
Over the, you know, preceding months, he's talked about 100%
tariffs on China. He's got a problem because China
(20:53):
has stopped buying soya beans from American farmers, and that
has caused a bit of a crisis here in the US And secondly,
China has almost all of the world's rare earth minerals,
which we need for the electronics that are so
important here in the US. They're talking about the
framework of a deal. How do you feel this meeting's
going to go, Matt? Well, what's so interesting
(21:14):
about the China meeting is that,first of all, it's a bit late in
coming. I mean, they should have had a
meeting much earlier, but there's been so much shadow
boxing and there's been such a kind of trade war between the
two of them. It's been virtually impossible
so far. Before we get to the, I want to
have, I have a lot to say about China and I know reasonable.
(21:34):
I used to be based in Asia. I went to China.
You know, I did Mandarin at school when I was 18 and I went
to China for three months in 1981 by myself.
I was the loneliest person I've ever met.
Shenzhen, which is now a mega city of 26,000,000, was then a
city, a town actually, of 10,000people.
(21:54):
Anyway, just briefly, Bannon, what Bannon said to me in in my
meeting with him in Rome is thatthe two things that Donald Trump
hates, one is to be made to feelstupid.
And the second one, which he hates even more, is not to be
cut in on a good deal, right? So that's what he's doing when
he's going around the world cutting good deals for America,
but also one assumes when he canabove board for himself.
(22:17):
Now with China, he thought back on Liberation Day that, you
know, looking at the trade balance, the Chinese sellers
five times as many things as we sell them, that he had the way
he wanted them. That, you know, he could
increase tariffs. And the initial stages, it was
like, I think 45%. And they would bow to his
greater will. Except the Chinese, having
(22:38):
tasted some of Trump's trade tariff eye in the first
administration, has spent the last five years getting ready
for the next round of Trump tariffs, which did not hit them
with any surprise. And what they knew they had that
American doesn't just want but needs is not just the rare earth
metals, but also pharmaceutical products.
(22:59):
There were 700 pharmaceutical products that cover everything
from cancer to allergies, you know, to, you know, heart
medicine. Some of it Trump might be on
himself, you know, and if you live in America, it's nothing
but medical ads on television. 700 of these antibiotics, 700 of
these can only be made because China is selling America the
(23:23):
chemicals in order, the pharmaceutical products in order
to make those things. That's on top of the rare earth
metals, which we've talked abouta lot recently, which go into
everything from smartphones to F30 fives, you know, everything
in America that is kind of digital and moves has got, you
know, a rare earth metal in it. Now, why are the Americans not
making the stuff themselves? Well, they used to make it in
(23:46):
the in the early noughties, America had two big rare earth,
you know, mines, I think one in Arizona, one in New Mexico.
But then they weren't making a lot of money because the Chinese
were making the stuff more cheaply.
And also they're very dirty to mine.
And in China they don't really give a stuff about the
environment. Whereas in America you kind of,
they do, oddly enough, they did,they did well, they, they did,
(24:08):
you know, even when it was Jewel, baby Jewel, they still
did. And so the Americans, like so
much else, outsourced this to China because it was cheaper and
there was a very efficient production and delivery line.
And of course, that put the Chinese in a position where they
are literally, they don't just mine 65% of rare earths, they
process 90% of the stuff. So one of the other deals that
(24:32):
he's discussing with Japan is how to mine rare earth metals.
I don't know if Japan has them. Actually, lots of countries do,
Ukraine included and how to process them.
So and, and of course, where he's right is that everyone else
and in Asia, they're more afraidof China than they are in the US
because they know what China feels like up close and
personal. He's got a sort of coalition of
(24:52):
the winning going on trying to get a rare earths out of the
soil and process them. And Australia is also part of
that deal. But that's but what he but for
him, he didn't really take that into account.
He thought if we stop buying theBarbie dolls that they make, and
by the way, they're not making them anymore because they're now
made in Vietnam, then they will hurt so much that they will just
(25:13):
buckle. And he was wrong on one thing,
though. I think we have to be, you know,
we have to be fair, not to him necessarily, but to the balance
of this trade war. Yes, the Chinese have the
Americans by the short and curlies on rare earth metals and
pharmaceuticals, but China is inthe middle of a major
manufacturing bubble. They had a housing bubble until
(25:36):
about 3 years ago, which was in is still in danger of bursting
catastrophically. You know, 10s of millions of
Chinese, formerly farmers now, now factory workers or clerks
bought flats that they thought worth was, were worth something
and they're not worth that anymore.
And that they're kind of knee deep in mortgages.
And so the along comes this ideafrom Xi Jinping.
(25:59):
We've got to build up our factory capacity.
We have to become the world's manufacturing hub, which is
indeed what they've done. You want to build anything, you
build it cheaper and faster and more efficiently in China than
anywhere else on the planet. But this capacity has to go
somewhere. They've got to sell the stuff
they make. And if America isn't buying that
anymore, it'll help. It'll hurt American consumers
(26:21):
because their Barbie dolls or their television sets or fridges
will be more expensive. And they weren't like that.
But it'll really hurt China as well.
Yeah. So both sides have a massive
motivation to try to come to some sort of deal.
I'm not sure if Donald Trump wasquite aware of the size of the
motivation on his side, as you say.
(26:42):
And look, I always find with allof this is, you know, people
might not believe that the way he's gone about tariffs is the
right way to go about it. And clearly tariffs are going to
impose a cost, a financial cost on American consumers.
But also, is there an underlyingargument there which isn't
untrue, which is, you know, whenyou talked about the idea that,
(27:05):
you know, they decided to take the rare earth minerals all from
China and many of these other goods, you know, you know, you
could argue that was because China was using cheap labour to
buy these goods rather, you know, to make these goods rather
than a comparative advantage in the way economists would
originally and purely have talked about it.
So I think the issue here is, and I find this in America,
(27:26):
there's no big outcry about Trump's tariffs at the moment,
partly because I think people sort of by his underlying
argument for it. The question is if and when the
prices start to rise at a level.But it's really quite painful.
I think that's huge because I think that was one of the
biggest factors in the last election.
And I think it's hard to get around that basically.
(27:47):
Absolutely, and especially for people who are, you know, who
don't earn a lot of money, inflation hits low income
families much harder than others.
But the other thing is that remember the the China tariffs
haven't actually kicked in yet because they've been kicked into
the long grass. So any inflation resulting from
China towers we won't have seen yet.
We, we will get to see that nextyear.
And the other really fascinatingthing about Trump is it like so
(28:10):
much in the world, he's, he's sort of 100 years behind
everyone else. So he's obsessed with American
manufacturing and reviving American manufacturing.
Like, you know, in the good old days of Bethlehem Steel and you
know, all these big company, youknow, all the early days of the,
of the, of the car, the car companies, the car giants.
But of course, he doesn't take into account and rarely talks
about automation. So if you're a company that
(28:31):
can't produce stuff cheaply in China, you produce it in America
with robots and with AI and, andyou're still not going to give
those poor American workers their jobs back.
The other thing is that he regards tariffs very much as
what they used to be literally 100 years ago when the
government, the federal government of Washington made
much more money from tariffs with other countries than it did
(28:53):
from taxes. There was, there was virtually
no income tax that people collected that the federal
government collected in those days, but there was quite a lot
of money, more money that they collected by charging people who
wanted to trade with America. So again, I don't know what he's
reading, you know, or if he's reading or who he's listening
to. He's got a very 19th century
mindset, not just about how power works on the world stage,
(29:15):
but also how the economy or the economic cookie crumbles.
And, you know, and at the same time, yes, he, you know, he,
he's interested in AI and he's fascinated by all that.
And he's trying to bring lots ofmoney into America to make sure
that, you know, they, they, theystay ahead of the game.
But even on that one, you remember, you know, the
(29:35):
Americans picked a war with Huawei, the electronics giant in
China that makes mobile phones, but now also makes cars.
And the idea was from the first Trump administration, you kill
off Huawei because we don't trust them, because they're a
Chinese company trying to encroach on our markets.
And you do this by denying them American made microchips.
Well, guess what? The Chinese then made their own
(29:56):
chips. They made them just as well, but
a lot more cheaply. And Huawei instead of dying has
become this resurgent, you know,digital era phone company turned
car company empire that is extraordinarily successful.
And so you mess with the Chineseat your peril.
And and the Chinese are very good at using the government,
(30:18):
the central government, either with tax incentives or
regulations to basically allow Chinese companies not just to
succeed, but also to fail and not be punished for it.
And so the idea to getting back to rare earth metals in America,
it's all down to the free marketcompany mines rare earth metals.
They're not making a ton of money out of it.
They find it easier if they do that in China.
(30:40):
The Chinese set up rare earth metal mining companies left,
right and centre. They allow four out of the 10
they've set up to go to the wall.
The other six thrive. They don't give a stuff about
the environment and then and then.
So it's Chinese industrial policy combined with free market
capitalism, that and, and an equal and a legal structure that
(31:02):
allows companies to to fail without too much punishment or
to thrive, you know, and they'verelatively low tax rate.
I mean, they've basically taken America's capitalist game and
beaten them at it. And Trump hates that.
He hates it. One thing I do wonder about what
we're going to see out of this agreement that we'll see
(31:22):
tomorrow and the meeting is it'sall based on fixing smaller
sectoral issues. So there'll be an agreement on
soya beans and there'll be an agreement on rare earth
minerals, which will stop China from going ahead with a plan to
halt exports or control exports to the US.
But actually, the question of trade between China and the US
(31:45):
is a much bigger one. It's one that has massive
implications for the entire world because of the size of the
two economies. It is one that actually, you
know, goes back decades. You know, America has never been
happy since China was part of the World Trade Organization.
Never thought it played by the rules in a fairway.
That's right to a good point. They cheated, yeah.
(32:06):
And, and so is, is a kind of agreement which is very focused
on individual sectoral issues actually going to fix the really
big tension between these countries?
And, and just as we're talking about this, China is the third
biggest exporter into the US youknow, Canada is above it.
And I just want to talk very briefly about what's happened in
(32:27):
Canada, because it is so interesting.
So the Ontario government put out an advert in which they
essentially played the voice of former President Ronald Reagan,
obviously a hero to many on the right in America, talking about
the need for free trade and how tariffs really hurt people and
how they hurt American consumersand they hurt jobs and so on.
(32:51):
And there was a complaint by an organization sort of set up in
Ronald Reagan's name that it hadmisinterpreted what Ronald
Reagan had actually stood for, missed out the context.
Donald Trump got angry about it and slapped additional tariffs
on Canada as a result of all of this.
And I just yesterday, I went back and I watched the original
(33:12):
radio delivery. It was radio, but it was also
filmed of Ronald Reagan and watched it to see whether it was
in context. And it was so interesting to
listen to it. It is true that the context was
that they had put tariffs on a few individual things with Japan
at the time, because there was avery specific argument to do it.
And what Ronald Reagan was trying to argue was there was a
(33:33):
really specific reason why I'm doing this.
But let me be clear. I believe in free trade on the
whole. I mean, the radio address, if
people were to go and listen to it, is stronger than the Ontario
advert. It is basically saying tariffs
hurt people, they hurt our people, they hurt our consumers,
they hurt our workers. And we should never go down the
(33:55):
line of trying to trigger a trade war because if we do,
gosh, the consequences will be huge.
It's fascinating. I never knew that Trump would
take Reagan quite so seriously, or rather want to protect him so
much. Or whatever it is.
I just just before we go really important on Xi Jinping meeting
Donald Trump there, there's something puzzling about Donald,
(34:15):
Donald Trump's attitude to China.
And I knew that he, he's been wary of China for a long time
because when I interviewed him back in 2013 and I said you
don't pick a fight with your banker China, that stage was the
biggest buyer of U.S. Treasury bills.
He called me stupid to my face, which is of course, a golden
moment. You want to be called stupid by
Donald Trump, but he really likes Xi Jinping.
He really admires him and he's been quite open about it.
(34:38):
But he's very wary of China and sees China as the global
competitor, America competitor to America, probably accurately.
I think that that is definitely what's happening right here.
But this love affair with Xi Jinping is really interesting.
And what I worry about on behalfof Taiwan, remember Taiwan is
that this, you know, this plucky, very wealthy island
(34:59):
nation that by the way, produces90% of the fastest
superconductor chips that are used anywhere, you know, from
fighter jets to refrigerators, you know, they, they're produced
in Taiwan. So Taiwan also has something
that everyone else needs and wants, but Taiwan doesn't want
(35:19):
to be part of China. The, the president of Taiwan who
was recently elected is more anti Chinese or anti the idea of
reunification than the previous one was.
And So what does Trump do here? Does he do what Biden did?
Who actually went out of his wayto say, I'm going to defend
Taiwan, China, if you attack Taiwan, moving away from the
(35:40):
policy of constructive ambiguity, which kept the the
Chinese guessing. Or does he say, as he did to Joe
Rogan in the election campaign, why are we protecting all these
people who stole our US chip technology?
Right. That made Taiwanese faces
blanche when they heard that. Because it's quite possible in a
(36:01):
transactional frame of mind thatTrump will say, OK, I'll do a
deal with China. What does China really want from
Trump other than its markets? It wants its hands off Taiwan.
And if America stands away from Taiwan, it'll be so much easier
for the Chinese, the People's Liberation Army, to try and
invade the island and take it over, which is a very difficult
(36:21):
and costly exercise, More difficult arguably than than
invading Ukraine because it's anisland with a very high
coastline. And the Taiwanese are very
motivated to fight back. Like the, like the Ukrainians.
They have, you know, quite a good army.
You know, they can take out Chinese ships coming their way,
etcetera, etcetera. It would be a very, very costly
thing to do. And Xi Jinping doesn't trust the
(36:43):
People's Liberation Army to do it well enough to do it
relatively bloodlessly. But that is his big ticket item.
And if Donald Trump is part of atrade deal, since even just
gives the Chinese the green light, that makes them think
that he may just stand to one side because he doesn't give a
damn about principles of democracy and freedom.
(37:03):
You know, that's irrelevant. It's about hemispheric power.
Then Taiwan is in big trouble. And that is where we then get
into a an incredibly nervous situation for Asia and possibly
for all of us if he suddenly changes his mind and says, well,
actually, I know you've started to invade Taiwan or you've got a
military blockade going on. But actually I do want to
protect them, either because I need their microchips or because
(37:26):
I I respect what they do. I respect them as a democracy.
We don't know. So this is a major point of
friction that they may try and sort out in their meeting in
South Korea, but they may actually just create more
trouble for further down the line.
Well, we'll all be watching veryclosely when these two leaders
meet tomorrow. It could have massive
ramifications for the world. That's all we've got time for
(37:49):
this week on Trump WORLD. I'm Anish Kristana here in
Washington, DC. I'm Matt Fry in London, goodbye
from the two of us and I hope you enjoyed it.
See you next week. See you next week.
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