Trump’s Populist Schism Over Syria

His troop-withdrawal plan is politically risky. The Republican base is more hawkish than isolationist.

The most surprising thing about President Trump’s decision to overrule his top advisers and withdraw U.S. forces from Syria and Afghanistan isn’t that it was improvised and disruptive. Sudden shifts are part of Mr. Trump’s method, and disconcerting senior officials is one of his favorite management tools.

The surprise is that for the first time, Mr. Trump made a foreign-policy decision that divides the coalition that brought him into the White House and risks his control of the GOP. Mr. Trump has frequently challenged and infuriated his political opponents, but his Syria decision risks alienating allies he can ill afford to lose.

Nowhere has Mr. Trump’s sense of populist America been more important than in foreign policy. As a candidate in 2015-16, he showed that he understood something his establishment rivals in both parties did not: that the post-Cold War consensus no longer commanded the American people’s support.

.. During the Cold War, a large majority of Americans united around the policies that built the international liberal order after World War II. But when the Soviet Union collapsed, a gap opened between those who saw an opportunity to expand America’s world-building activities and those who saw an opportunity for the U.S. to reduce its commitments overseas. The foreign-policy establishment across both parties supported an ambitious global agenda, but increasingly alienated populists preferred to pull back.

For a quarter-century after the Soviet Union collapsed, the establishment consensus for building up the global order dominated American foreign policy, and dissenting voices were shunted aside. By 2016, that was no longer possible. In the Republican Party, Trump’s antiestablishment message led him to victory; on the Democratic side, Sen. Bernie Sanders’s campaign also benefited from opposition to establishment policies on security and trade.

The conservative opposition to conventional American foreign policy is anything but monolithic. One group of critics continues the Jeffersonian tradition of preserving American liberties at home by minimizing American involvement abroad. Figures like Sen. Rand Paul and his father, former Rep. Ron Paul, speak to this side of the populist coalition. Jeffersonians are skeptical of international institutions and alliances as well as American interventions to protect human rights abroad. They oppose big defense budgets and extensive military deployments and see no reason for an anti-Russia foreign policy. Many believe that Israel seeks to drag the U.S. into Middle East struggles that Washington would do better to avoid. Sen. Paul was quick to announce his support for President Trump’s Syria decision.

The other, Jacksonian wing of conservative populism shares the Jeffersonian suspicion of multilateralism and humanitarian interventions, but is more supportive of the American military and of maintaining America’s reputation for standing by allies. Jacksonians are hawkish about China, Russia and Iran and favor a strong relationship with Israel. This tendency in American politics is represented by figures like Sen. Tom Cotton, a U.S. Army veteran who served in both Afghanistan and Iraq and has criticized Mr. Trump’s Syria decision.

Mr. Trump’s beleaguered presidency needs both Jeffersonian and Jacksonian support to survive, and until the Syria decision, he had managed the tension between the two currents pretty effectively. Both Jacksonians and Jeffersonians supported the withdrawal from the Paris climate accord, and both hailed the president’s skepticism about humanitarian intervention. Both sides enjoyed the discomfiture of the foreign-policy establishment when Mr. Trump challenged conventional wisdom, and both praised his willingness to pursue a more unilateral course in foreign affairs.

That harmony may soon sour. Mr. Trump’s decisions on Syria and Afghanistan risk a rift between the president and his Jacksonian supporters and provide a way for some in the GOP to break with the president without losing their own populist credentials.

  • The betrayal of the Kurds, the
  • benefits to Iran of American withdrawal,
  • the tilt toward an Islamist and anti-Israel Turkey, and
  • the purrs of satisfaction emanating from the Kremlin are all bitter pills for Jacksonians to swallow.

Of the two wings of the GOP populist movement, the Jacksonians are the stronger and, from a political standpoint, the more essential. The GOP base is more hawkish than isolationist, and from jihadist terrorism to Russian and Chinese revisionism, today’s world is full of threats that alarm Jacksonian populists and lead them to support a strong military and a forward-leaning foreign policy.

Neoconservatives tried and failed to rally GOP foreign-policy hawks against Donald Trump. Should Jacksonians turn against him, they are likely to pose a much more formidable threat.

From Economic Crisis to World War III

The response to the 2008 economic crisis has relied far too much on monetary stimulus, in the form of quantitative easing and near-zero (or even negative) interest rates, and included far too little structural reform. This means that the next crisis could come soon – and pave the way for a large-scale military conflict.

BEIJING – The next economic crisis is closer than you think. But what you should really worry about is what comes after: in the current social, political, and technological landscape, a prolonged economic crisis, combined with rising income inequality, could well escalate into a major global military conflict.

The 2008-09 global financial crisis almost bankrupted governments and caused systemic collapse. Policymakers managed to pull the global economy back from the brink, using massive monetary stimulus, including quantitative easing and near-zero (or even negative) interest rates.

But monetary stimulus is like an adrenaline shot to jump-start an arrested heart; it can revive the patient, but it does nothing to cure the disease. Treating a sick economy requires structural reforms, which can cover everything from financial and labor markets to tax systems, fertility patterns, and education policies.

Policymakers have utterly failed to pursue such reforms, despite promising to do so. Instead, they have remained preoccupied with politics. From Italy to Germany, forming and sustaining governments now seems to take more time than actual governing. And Greece, for example, has relied on money from international creditors to keep its head (barely) above water, rather than genuinely reforming its pension system or improving its business environment.

The lack of structural reform has meant that the unprecedented excess liquidity that central banks injected into their economies was not allocated to its most efficient uses. Instead, it raised global asset prices to levels even higher than those prevailing before 2008.

In the United States, housing prices are now 8% higher than they were at the peak of the property bubble in 2006, according to the property website Zillow. The price-to-earnings (CAPE) ratio, which measures whether stock-market prices are within a reasonable range, is now higher than it was both in 2008 and at the start of the Great Depression in 1929.

As monetary tightening reveals the vulnerabilities in the real economy, the collapse of asset-price bubbles will trigger another economic crisis – one that could be even more severe than the last, because we have built up a tolerance to our strongest macroeconomic medications. A decade of regular adrenaline shots, in the form of ultra-low interest rates and unconventional monetary policies, has severely depleted their power to stabilize and stimulate the economy.

If history is any guide, the consequences of this mistake could extend far beyond the economy. According to Harvard’s Benjamin Friedman, prolonged periods of economic distress have been characterized also by public antipathy toward minority groups or foreign countries – attitudes that can help to fuel unrest, terrorism, or even war.

For example, during the Great Depression, US President Herbert Hoover signed the 1930 Smoot-Hawley Tariff Act, intended to protect American workers and farmers from foreign competition. In the subsequent five years, global trade shrank by two-thirds. Within a decade, World War II had begun.

To be sure, WWII, like World War I, was caused by a multitude of factors; there is no standard path to war. But there is reason to believe that high levels of inequality can play a significant role in stoking conflict.

According to research by the economist Thomas Piketty, a spike in income inequality is often followed by a great crisis. Income inequality then declines for a while, before rising again, until a new peak – and a new disaster.

This is all the more worrying in view of the numerous other factors stoking social unrest and diplomatic tension, including

  • technological disruption, a
  • record-breaking migration crisis,
  • anxiety over globalization,
  • political polarization, and
  • rising nationalism.

All are symptoms of failed policies that could turn out to be trigger points for a future crisis.

.. Voters have good reason to be frustrated, but the emotionally appealing populists to whom they are increasingly giving their support are offering ill-advised solutions that will only make matters worse. For example, despite the world’s unprecedented interconnectedness, multilateralism is increasingly being eschewed, as countries – most notably, Donald Trump’s US – pursue unilateral, isolationist policies. Meanwhile, proxy wars are raging in Syria and Yemen.

Against this background, we must take seriously the possibility that the next economic crisis could lead to a large-scale military confrontation. By the logicof the political scientist Samuel Huntington , considering such a scenario could help us avoid it, because it would force us to take action. In this case, the key will be for policymakers to pursue the structural reforms that they have long promised, while replacing finger-pointing and antagonism with a sensible and respectful global dialogue. The alternative may well be global conflagration.

Europe’s Trade Victory in Washington

US President Donald Trump holds himself out as a brilliant negotiator, and his supporters regard his trade policy as a perfect example of his success. But in his recent trade talks with the Europeans, Trump was clearly out of his depth.

.. The two sides agreed “to work together toward zero tariffs, zero non-tariff barriers, and zero subsidies on non-auto industrial goods.” It seemed like a remarkable U-turn for Trump, who, until recently, was threatening the European Union with higher tariffs – and extolling the value of trade tariffs (which are essentially taxes on imported goods) more generally. He even called the EU a “foe” as recently as June.
Substantive follow-through on the joint US-EU statement would represent a major policy shift for the Trump administration. But this is no triumph for Trump; rather, he seems to have been outmaneuvered by adroit European diplomats.
.. what Trump and Juncker announced was essentially a pledge to work toward exactly the kind of trade agreement that the Obama administration was negotiating with the Europeans from 2013 through the end of 2016. Work on that earlier version, known as the Transatlantic Trade and Investment Partnership (TTIP), was suspended following Trump’s inauguration.
.. Restarting the TTIP negotiation is a big win for Juncker
.. It is also remarkable that Juncker managed to get Trump to emphasize working with the World Trade Organization to resolve issues regarding 
.. What did Trump get from the Europeans, other than a return to a trade negotiation straight out of the Obama era? Trump claimed, at the press conference and subsequently, that he won a pledge from Juncker to buy more natural gas and “a lot of soybeans.” Some media coverage even suggested that the Europeans had made concessions. But that interpretation does not fit the facts.
.. Regarding potential US exports of liquefied natural gas (LNG) to Europe, the Europeans have long been keen to increase this trade. The hold-up is US restrictions on energy exports.
.. If there is any concession promised by the joint statement, it is from the Trump administration on this issue. This was made explicit in the fact sheetthat the White House subsequently issued: “the United States will make it easier for the EU to purchase liquefied natural gas.”
At the same time, Juncker does not buy soybeans – the European Commission has no such budget, and any such imports would ultimately be a private-sector decision.
.. . The price of US soybeans has fallen significantly more than has the price of Brazilian soybeans, as Brazil is not subject to the new Chinese tariff. Given this, it makes sense that the European private sector will buy more US soybeans, regardless of what Juncker says or does.
.. there was no European concession at the White House on this issue – just a clever restatement of market realities.
.. The soybean pledge has some superficial political appeal, as growers have found themselves caught in the crossfire of Trump’s trade war with China. The cost is real, and the Trump administration recently promised up to $12 billion to help affected agribusinesses.

However, this entire potential cost is due to the Trump administration’s disruptive policies and represents a scandalous waste of taxpayer money – an amount equal to about one-third of the entire annual budget of the US National Institutes of Health.

.. Trump holds himself out as a brilliant negotiator, and his supporters regard his trade policy as a perfect example of his success. But in his recent talks with the Europeans, Trump was clearly out of his depth.

For Trump, Failure Is the Only Option

that they raise it to 4 percent of G.D.P., much higher than the bloated military spending in his own budget. He then claimed, falsely, to have won major concessions, and graciously declared that it is “presently unnecessary” to consider quitting the alliance.

Was there anything our allies could have done that would have mollified him? The answer, surely, is no. For Trump, disrupting NATO doesn’t seem to be a means to an end; it’s an end in itself.

.. While Trump rants about other countries’ unfair trade practices — a complaint that has some validity for China, although virtually none for Canada or the European Union — he hasn’t made any coherent demands. That is, he has given no indication what any of the countries hit by his tariffs could do to satisfy him, leaving them with no option except retaliation.

.. So he isn’t acting like someone threatening a trade war to win concessions; he’s acting like someone who just wants a trade war. Sure enough, he’s reportedly threatening to pull out of the World Trade Organization, the same way he’s suggesting that the U.S. might pull out of NATO.

.. Whatever claims Trump makes about other countries’ misbehavior, whatever demands he makes on a particular day, they’re all in evident bad faith. Mr. Art of the Deal doesn’t want any deals. He just wants to tear things down.

.. The institutions Trump is trying to destroy were all created under U.S. leadership in the aftermath of World War II. Those were years of epic statesmanship — the years of the Berlin airlift and the Marshall Plan, in which America showed its true greatness. For having won the war, we chose not to behave like a conqueror, but instead to build the foundations of lasting peace.

Thus the General Agreement on Tariffs and Trade, signed in 1947 — at a time of overwhelming U.S. economic dominance — didn’t seek a privileged position for American products, but instead created rules of the game to promote prosperity around the world. Similarly, NATO, created in 1949 — at a time of overwhelming U.S. military dominance — didn’t seek to lock in our hegemony. Instead, it created a system of mutual responsibility that encouraged our allies, including our defeated former enemies, to see themselves as equals in preserving our mutual security.

.. anything that weakens the Western alliance helps Vladimir Putin; if Trump isn’t literally a Russian agent, he certainly behaves like one on every possible occasion.

.. Trump obviously dislikes anything that smacks of rule of law applying equally to the weak and the strong. At home, he pardons criminal bigots while ripping children away from their parents. In international relations, he consistently praises brutal strongmen while heaping scorn on democratic leaders.
..

He may complain that other countries are cheating and taking advantage of America, that they’re imposing unfair tariffs or failing to pay their share of defense costs. But as I said, those claims are made in bad faith — they’re excuses, not real grievances. He doesn’t want to fix these institutions. He wants to destroy them.

.. Alternatively, you might have thought that big business, which is deeply invested, literally, in the existing world order would protest effectively. So far, however, it has been utterly ineffectual. And while talk of trade war sometimes causes the stock market to wobble, as far as I can tell, investors still aren’t taking this seriously: They imagine that Trump will bluster and tweet for a while, then accept some cosmetic policy changes and call it a win.

But that kind of benign outcome looks increasingly unlikely, because Trump won’t take yes for an answer. He doesn’t want negotiations with our allies and trading partners to succeed; he wants them to fail. And by the time everyone realizes this, the damage may be irreversible.