Patterns of Power in Trump’s Presidency

- So there's an element of risk, and I'm not sure how conscious it's, but there's an element of risk in Donald Trump's Nixonian strategy. It's a great pleasure to be with you. Unlike Professor Kotkin, I'm going to use the stage because I don't have his height advantage. So I want to talk about a period somewhat further back than 1975, because to me, 1975 is barely history since I was alive then. And on the eve of the great punk rock revolution that changed my life, I, I'm going to take us a little bit further back and what I'm gonna try and do is what I think of as applied history. The, the goal here is to try to make sense of this extraordinary second Trump administration, which causes all kinds of derangement to commentators. 'cause Trump derangement syndrome comes in a variety of different flavors. The European version illustrated on this slide here is that Trump is de we are now dealing with full blown empire. And this is the cover of De Spiegel from back in January. On the other side of the slide, you can see Gideon Rackman column from the Financial Times, Trump, Putin Sea, and the New Age of Empire. And you see Trump carving the world up like an enormous Christmas pudding, actually an allusion to a cartoon from the early 19th century when Napoleon was carving up the world with the other great powers. But the European derangement syndrome is in some ways conflicted because while they liked to call Trump the Emperor, they also want to make the joke that he always chickens out. So the Taco trade, which you'll now remember, originated in the Financial Times in a, I think a Robin Brooks column was well in all these trade negotiations. So it was argued, you know, he always chickens out because in the end, after all the big threats they end up settling at, at at lower rates. And this then was extended by Gideon Achman into, he was chickens out in foreign policy too. So the taco trade was about more than trade. And then Trump spoiled the narrative of the taco trade by not chickening out and actually bombing the Uranian nuclear facilities in Fordo in publishing this fine truth on his social media app. This is very difficult to process if you are writing for the Financial Times and your mandate is to write negative copy about President Trump. He's the emperor who always chickens out, except when he doesn't, is not to me a satisfying historical interpretation of where we are. Some of my best friends are economists. I am not an economist. I'm an economic historian for economists, including some of our colleagues, including some that you've heard from. It's very painful. The President Trump is imposing tariffs and turning the clock of American trade policy back to the 1930s and no disaster is happening. This is very painful. If you are committed believer in David Ricardo's theory of Comparative Advantage or Wadden Smith's belief that free trade is always optimal. If a president turns us trade policy back to the 1930s, economics says bad stuff should happen. And you may have noticed that so far that bad stuff didn't make it to Wall Street because the s and p 500 is at all time highs. So that's, that's historically problematic. I wanna talk a bit about why that's historically problematic and then just to kinda add to the confusion, we have the phenomenon of a second Trump administration eliciting in response from the Democratic party, not what you'd kind of predict. Namely, they'd look to regain the center ground if that's being catered by the administration. No, Democrats are running full-blown socialists, maybe even communists in major cities, including not only New York, but also Minneapolis. So how can we make historical sense of the fact that while the President is pursuing policies we haven't seen in the United States for 90 years, the Democratic Party appears to be further left ideologically than it's ever been, certainly further left than it was in 1975. So when I'm not giving talks like this, I write books, it's a kind of old fashioned thing to do. NN just about. Nobody in your generation reads books. They don't 'cause chat. GPT provides a summary and you just pretend that you read the book. This is what goes on here at Stanford with almost no attempt to stop it. But I'm old fashioned and I think books are superior to podcasts as a source of, of analysis and information. And I'm gonna carry on writing books, not necessarily books like these, but these two books are the most relevant to what I'm gonna talk about. So never lose a chance to sell books. A, B, C. Always be Closing. So Colossus was a book that I published shortly after the Invasion of Iraq back in 2003 and and it's book about American Empire. And my most recent book, doom with the subtitle, the Politics of Catastrophe is an attempt to make sense of the events of the recent past, including the pandemic of of 2020, but also all the disasters that ever happen in history. Because it's important to understand that although disasters are sometimes classified as natural and sometimes as manmade, actually old disasters are essentially political in nature. Because ultimately, while you might think of volcano, erupting is a natural disaster. It's only a disaster if you decided to build a great big city right next to it. Hence the tight subtitle, the Politics of Catastrophe. Scott will confirm that the COVID-19 pandemic was made catastrophic by policy responses that even at the time some of us regarded as out of all proportion to the nature of the threat that was posed. Okay, I told you I was gonna take you back further than 1975, but did you expect ancient Rome? Apparently all the male students in the room think about ancient Rome once a day, correct? This was, this was on the internet. So it must be true. Certainly there's a kind of historical journalist, a journalist engaging in historical reflection who loves to write articles about Are We Rome? There's even a book. And I, I want to suggest to you that this is probably the wrong framing, that trying to shoehorn contemporary American history into the framing of the end of the republic and the advent of the empire is probably not that illuminating because when you actually read the history of the end of the republic and the advent of the empire, whether it's in TAUs or ston, you realize it for just a radically different world, so much more different that that we, if we, if there were a time machine, and I could take you back to Rome at the point that Augustus or Octavian became friendships, you'd be aghast at how extraordinarily violent and alien ancient Rome was. So I'm gonna suggest that this is not the way to think about this. If we are living through the end of the republic and Donald Trump really is Octavian and there's going to be an empire, then we won't really know for some time Romans weren't aware that the republic was over at any particular point. It was an imperceptible process where the Senate lost its power and all power became vested in the friendships. I suppose it's conceivable that that could happen, but I would put the probability in low single digits that that is really what we are living through. And here's why There are just better analogies for the problems that the United States faces today. Donald Trump himself offers an analogy in an interview last year about this time last year. He said, my guy is William McKinley, he's in a Bloomberg interview tariff man, the original tariff man, that's my role model. Most commentators passed this over. I thought this was deeply revealing that the president's hero was tariff man, McKinley, who was famous for the tariffs that he got passed through Congress when he was in the House of Representatives. And then pursued not only a policy of protectionism as president, this is all in the late 1890s, but also was in many ways a committed empire builder who acquired a significant amount of territory for the United States as a result of the Spanish American war. So when Trump signaled that McKinley was his role model, he was telling us tariffs are on my agenda and maybe also a territorial acquisition. So when he began to talk about Greenland, Canada is the 51st state, the Panama Canal. He was just being McKinley. People unfamiliar with President McKinley, and most people don't know any history at all before probably Roosevelt Franklin. This has all been quite surprising. But if you just listen to what Trump was telling us, you understood his role model. Anybody watch a TV series called The Gilded Age? Okay, so we know that you watch tv, even if it's not clear that you read books, the Gilded Age is a kind of good timing series because if Trump is right, then maybe one way to think about where we are is in a new gilded age that would be characterized by significant disparities of wealth and income, protectionist trade regime, debates about monetary policy, debates about excluding immigrants. There's a sense in which this fits quite well. So one framework is new gilded Age, but the other framework that I want to offer you is different because the situation of the United States in the late 1890s was radically different from the situation of the United States today because the situation of the United States today is that of a global superpower, which is suffering from significant overstretch in my view. It therefore has more in common with the situation of Britain in the 1920s and 1930s than with the United States in the late 1890s when the United States wasn't even recognized as a great power by the European Empires. At the beginning of this year, I published a a paper and an op-ed about Ferguson's law, which sounds like an ego trip until I point out that it's named after Adam Ferguson. And my version of Ferguson's law states that the United States is, is violating Ferguson's law. Ferguson's law states as follows, any great power that spends more on interest payments than on defense will not be great for much longer. And it just so happens that the United States violated Ferguson's law for the first time last year because of the size of the federal debt and rising interest rates for the first in its modern history, United States is now spending more on interest payments than on defense and it's gonna get worse. So this chart is based on congressional budget office data, and it shows you the making reasonable assumptions about where discretionary spending will go, where interest rates will go. It's possible that by the 2040s the US will be spending twice as much on interest payments as on defense. That's not the kind of problem that the United States had to, to deal with back in the 1890s. It was the kind of problem Britain had to deal with in the 1920s and 1930s. And that's why I think we need a framework that is not all American to understand the predicament of the United States during the second Trump administration. Now, professor Cochran rightly pointed out that one of the problems with American power in 2025 compared with 1975 is that in 1975 the United States was still a manufacturing superpower, far outclassing the competition, but that is no longer true. Now, unlike Professor Gog, I don't really do standup, I do PowerPoint for which I apologize. The advantage of this chart is it shows you how dramatically the economic balance of power has shifted. If you look just at gross domestic product on a purchasing power parity basis, adjusting for the fact that a haircut in Nanan Jing is way cheaper than a haircut in Palo Alto, China already overtook the United States in terms of GDP 10 years ago. In current dollar terms, it's still on around 70% of us. GDP, the Soviet Union never got above 44%. So China's a bigger challenge than the Soviet Union ever was. Point one. And here's the, here's the chart to illustrate the kin point. If you go back to 2004 to just over 20 years ago, US manufacturing value added was twice that of China. Today, China's is twice that of the United States. This chart tells you that there has been a drastic reversal of economic fortune and power in the sense of manufacturing capacity. Again, this has never happened before in the Gilded age. The United States had overtaken Britain to become the first industrial nation, and it retained that dominance right through the 20th century. But the US lost manufacturing primacy this century in our time. That means that the stakes of great power conflict are higher, the risks are higher for the United States than at any point in its modern history. Speak. Brozinsky KY was Jimmy Carter's national security advisor to go back to our 1970s show. And Brzezinski after the Cold War wrote a book. The book was called the Grand Chess Board. And in it, Brzezinski predicted a worst case scenario. He said, the worst thing that can happen in this post Cold War world, the most dangerous scenario would be a grand coalition of China, Russia, and perhaps Iran. Well, guess what happened during the Biden administration or the auto pen administration, whatever you wanna call it, the worst case scenario happened, and it was even worse than Brisky foresaw because North Korea also joined the axis of authoritarians. So compared with eight years ago, we are in a new political environment in which China not only is a manufacturing superpower, but it's formed in an axis with Russia, Iran, and North Korea. Hence the CRS that is more powerful in terms of its military capability than the original axis of 19 39 40. This is the context for Donald Trump's second term. These are the problems the president faces. And I want to suggest to you that he's trying to address these problems in two distinct ways and in doing so, he's influenced by the most unlikely role model that a US president could possibly have. Richard Nixon and Donald Trump made friends in New York in Nixon's twilight years when he was trying to salvage some reputation for himself as an elder statesman. And Donald Trump was the real estate guy on the make. And they met and they dine together and they hit it off. And there's a correspondence between them. Being a historian, I always like people's letters. It's really the strange pathology that historians have that they like reading the letters of dead people. If you ever find yourself doing this, you should consult a therapist. You may be becoming a historian. The letters include a letter in which Nixon says to Trump, you know, pat saw you on TV last night, she thought you were amazing. You, you should think about politics. So the Nixons were probably the first people to see Donald Trump's political potential. And I want to suggest to you that Donald Trump is really Richard Nixon's revenge on his enemies. That's how we should understand him. 'cause Trump and Nixon have the same enemies they hate under hated by the exact same people. New York Times, Harvard, the Department of Justice, the deep state. It's the same cast of characters. And as you read documents from the 1970s, you realize, or transcripts of telephone calls, how much they have in common. That sense that the fake news is out to get you. What people I don't think have noticed is the extent to which what we have witnessed this year is out of Richard Nixon's playbook. Sir Richard Nixon in 1971 delivered two incredible shocks to the International economic and geopolitical order. A completely surprised America's allies and adversaries. The first was in July when without any warning, because they had kept it completely secret, he announced that he was going to meet Maze Dong the following year in Beijing. A month later, again with no warning, Nixon announced that he was ending the link between the dollar and gold. So devaluing the dollar, imposing a 10% tariff on all imports and the number of other radical economic measures. We have experienced a similar Trump shock this year. And what I wanna spend the next ooh, give you 10, 15 minutes. The next 15 minutes doing is explaining what these shocks signify and what the problems might be with the Trump shocks. Spoiler alert, it did not end brilliantly well for Richard Nixon, and this is why no subsequent president has taken Nixon as a model. So there's an element of risk, and I'm not sure how conscious it is, but there's an element of risk in Donald Trump's Nixonian strategy.