What's Next for China and the Future of U.S. - Chinese Relations

In this episode, we report on China’s 20th Party Congress, where Xi further consolidated his power. We also consider whether the U.S. is going down the right path with its own Industrial Policy to counter China. As usual, there is a lot on the Russia-Ukraine front, including Russia’s attack on Ukraine’s electrical grid.

We then turn to Iran to discuss the resilience of their ongoing protests. The U.K. has a new Prime Minister. Will he bring stability to the politics there, and is that enough? Finally, Brazilians went to the polls last Sunday to vote for their next President, and we cover what you need to know about this election.

CORRECTION: The author of the twitter thread on negotiating with Putin was attributed to Dan Nexon, but was actually @ProfPaulPoast.

China - 00:04:00
Russia-Ukraine - 00:47:00
Iran - 01:05:00
UK - 01:09:00
Brazil - 01:15:00

Some of the Articles and Resources Mentioned in Episode

China’s 20th Party Congress: Takeaways and Implications

• Xi Jinping Has Fallen Into the Dictator Trap (NY Times- Susan Shirk)
• For Xi Jinping, loyalty trumps ability (The Economist)

Economic War with China and Industrial Mobilization: Are we taking the wrong approach?

• China is weaker than we thought. Will we change our policies accordingly? (Fareed Zakaria- WaPo)
• The risks of Bidenomics go beyond inflation (The Economist)

Russia-Ukraine Update

• Russia’s destroying infrastructure in Ukraine, and the consequences are dire (Vox)
• Prices are down. Supplies are good. Europe’s gas crisis gets a reprieve. (WaPo)

UK Leadership Shuffle

• Rishi Sunak’s promise of stability is a low bar for Britain (The Economist)

Brazil Election: Final Round

• Brazil’s election is tight ahead of a run-off on October 30th (The Economist)

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Transcript

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Welcome to Kellogg's Global Politics, a podcast on current events in U.S. foreign policy and international affairs. My name is Dr. Anita Kellogg, an international relations scholar specializing in the relationship between economics and national security. I'm here with my co-host Ryan Kellogg, an expert in energy investment and policy. Thanks. Glad to be back. So this is episode 21, and we're recording this on October 30th, 2022. On this episode, we report on China's 20th party Congress, where a chief further consolidated his power. We will also look at China's more dismal assessment of the international strategic environment and whether the U.S. is going down the right path with its own industrial policy to counter China. As usual, there is a lot going on on the Russia-Ukraine front, including Russia's attack on Ukraine's electrical grid. We then turned Iran to discuss the resilience of their ongoing protests. The UK has a new prime minister. Will he bring stability to the politics there, and is that enough? Finally, Brazilians go to the polls today to vote for their next president, and we update you on the latest of this election. But first, let's see, Ryan is making me do this during sunlight hours, so I don't get to drink my usual cocktail, although you are drinking coffee in Baileys, right? I am a little bit, even though I'm still a little bit on the clock too, but you know, why not?  So drink and work on the clock? No comment on that. But anyway, I mean, so we talked last time, you know, you started your new job. You've been kind in a training period for your first month, but in the over the last couple of weeks, you've been teaching your first classes at the National Defense University. You know, got the opportunity to check out. It's pretty awesome. It's located on Fort McNair, so just south of the Mall, kind of that area, DC. It’s is really, really cool campus, but so how have you enjoyed the teaching process so far? First, I just want to say, you know, taking your dad there, it was pretty amazing for me to watch too, because you know, it's hard to imagine going back someplace, although I can also see it not too long in our future, but going back someplace where you'd been 48 years ago, you know, and all those memories. And I just thought that was, it was really nice for me to watch him get to explore some of that. That was good. Yeah. And I'm sure he appreciates that. I know, yeah, he appreciated the visit a lot. I mean, he was stationed there with the Old Guard, which is a ceremonial unit. I think it's since moved to, I can't remember the name of the fort, but across the Potomac River in Virginia. But yeah, he had a lot of memories there and doing drills out in the big, big expansive field. That kind of is pretty close to where you teach. Yeah. So I thought that was really neat. And as for teaching, I think it's going well. It's a totally different environment. So when you're teaching, I have 12 students and you're, you know, they're all type A highly engaged sort of people. A lot of times you have trouble getting your international students into the discussion because they don't speak English as well, but both mine are very participatory. And so it makes, it makes it go by fast. And it's interesting. And it's, it's always good when you can ask questions and people are really engaged in answering them and having a discussion about them. So a little bit different than a lecture hall filled with 120 undergrads. So you're saying? A thousand times different, which is part of why I was nervous because it was like, I've never done this before. I can't even visualize it, you know, and it's good when you have a class or two down, because then you're kind of, you're repairing, you kind of have an idea of what the flow of the class is going to be like and how they're going to respond to things. So. Yeah. No, that's awesome. Yeah. So I guess it's on with the. Yeah, let's jump into it. Okay. So we decided to go in a slightly different order today. And we are going to begin with China, the one thing that everyone in the country, regardless of political stripes, can agree on in their antipathy towards China, I suppose. So what's been in the news is the 20th party Congress. And the reason why this is important every once every five years, there's a party Congress and they decide who the next leaders are going to be and sort of what the plan for China is going to be over the next five years. And I think the debate over the next leaders was, will he choose purely loyalists or will he choose to try to have more consensus between the more economically sided part of the party who's a little bit disturbed by the government's intervention into the private sector? And that question was answered. He dramatically chose loyalists. So there's a seven person standing committee who have the most power next to Qi. And out is the current premier, Li Keqiang. And he was more one of the market friendly reformers. So he's out. The other person who's out is Wang Yang, who was once seen as the possible successor to Li. And kind of to get a sense of their economic perspective, Li Keqiang actually won the top economics award for his doctoral dissertation in 1994. And Wang Yang was an architect of the free market economic boom in southeastern China. So that's where their perspective is. And it's kind of, you know, it says a lot that she got rid of them. Also expected to be promoted to the standing committee was Hu Chenhua, who was the deputy prime minister and ally of Mr. Li. And some thought that he might even be promoted to the premiership, which is essentially like the prime minister. But he was not only not promoted to the standing committee, but he was completely booted out of the political bureau. I should have said how to pronounce that. So in again, as a symbol of loyalists is the next premier will be Li Qiang. And he has been the party's leading man in Shanghai, obviously, Chinese commercial hub. And what's controversial about this is the months long lockdown, Shanghai experienced, which did not go very well. And citizens are very unhappy about. So the fact that she promoted him is sort of this consolidation around loyalists and also a sense of the party not being as responsive as it used to be to citizens and their discontent. Also, I've note that there are no women on the political bureau for the first time in 25 years. So basically what we saw is China moving even further to more of an authoritarian dictatorship away from more of a party authoritarian led country. And this has a lot of disturbing implications. I mean, for China watchers such as yourself, I mean, did any of that come as a big surprise? I mean, were they expecting somebody like Lin Qiuchang, who had kind of the more market friendly policies to succeed? Or was this this kind of all expected that it would be strictly loyalists, that the whole idea of kind of a meritocracy around competence that that would be thrown out the window for she loyalist? Yeah, I'm not so much a domestic politics person, but my sense in reading before and after the Congress is people just didn't know. I don't know that there was an expectation either way. There was a sense that she would go one way or the other. But no one, I mean, obviously, people are disappointed in the role that he took. But I don't think there was a lot of people who knew for sure had a strong expectation of which way he would go. Probably a little bit leaning more toward the loyalists. But I think people were just still really hopeful that the technocrats would still have some some role there. And who I mean, looking ahead, I mean, obviously, he in taking this unprecedented third term, or beyond three term, this is this is third term. Yeah, this is his third term and staking out essentially a claim for for life. But still, they like to groom somebody as a successor. Did anybody emerge out of that that select seven in the standing committee as the likely person that he's grooming to be a successor? Or is it that was another surprise? I think that was probably one of the bigger surprises is that he did not have anyone in there that is groomed to be his successor. So there's no signs of a successor. And people really expected, yeah, to find someone in the standing committee who might be groomed for that role. Yeah, so that was that's another sign people took of the sort of personalistic consolidation. But even then, you know, you'd still think maybe some successor. But anyway, yeah, that was also a big surprise for people. That's probably one of the biggest surprises. So last Wednesday, I went to talk by Susan Shirk, who's one of the big China watchers. He does a lot of domestic politics, but she's has a lot of like great books and scholarship on China, many of them which are also popular books to read. And she actually served in government, I hadn't known that. So she has an article out where she was talking about how notable how unusual it is that he's concentrated more power in his hands, any leader since Mao Zedong, so much so that he's called the chairman of everything. I think one thing I think she points out or it was a different article is how this goes against Deng Xiaoping's vision for China, where he survived many reformist attempts during Mao Zedong. And when he became the leader of China, he's the one who kind of opened it slowly to private capitalism. But also, he was trying to design a party that would not have another Mao Zedong, that power wouldn't be concentrated in the hands of one person, but that party institutions rule. I mean, he wasn't for democracy, but he thought more of the party should have institutions that are strong to prevent power just being in one person's hands. Probably from all the purges he suffered under Mao. In China, had stayed on that trajectory until Xi and now is definitely going in the direction that Deng Xiaoping wanted to avoid. But it turned out the institutions were not strong enough to prevent the sort of strongman from arising, which is kind of an international trend of institutions that are supposed to prevent certain types of leaders not really living up to that. Yeah, I mean, it's kind of interesting. I mean, what's your perspective on how he accomplished that? I know a lot of it seemed to be around this anti-corruption campaign, which was, I mean, obviously, there was a lot of corruption going on. As his predecessor, Hu Jintao, kind of really opened up the economy, encouraged entrepreneurship. You also had a lot of government leaders through graft and whatnot, getting pretty wealthy, becoming centers of power themselves. And I feel like I remember reading one research paper that looked at who was being targeted by Xi in relation to their connections within his network. And it was clearly, there was obviously corruption going on, but he was targeting his political enemies in adversaries very much in that process. Is that really how he consolidated power effectively by framing it as like this anti-corruption push against elites? It's funny because in the beginning of it happening, there's a talk at UCLA with a research paper that kind of said the opposite that said that that was sort of the assumption. But when they looked at the data, it wasn't concentrated on enemies, but was more focused on legitimate corruption. But obviously, yeah, this is how he ended up consolidating his power. I don't know that it was specifically to go necessarily after his enemies. I mean, it did genuinely take out some of the most corrupt officials in the Communist Party and did really clean it up a lot. But it is also how he ended up consolidating power. I think the biggest thing is he didn't allow his friends necessarily to participate in the corruption. He didn't give them a pass, but he definitely went after and focused more on any challenges to his authority and power. And in fact, the anti-corruption campaign has kind of died down. And then right before the party congress, two party members were removed for corruption. And people were kind of a little surprised by that power play. So that definitely was one of the instruments of doing so, not the only one, but certainly an important instrument that she was able to use. And I think people were wary of what was happening at the time. But I don't know that people thought that it would end up at this point. So the things about Xi that really kind of goes against what China's economic miracle has been, which is the more state-led central controlled economy. Although I do want to point out that 80% of the Chinese economy is still private enterprise. And what people focus on is the government trying to have closer ties to certain businesses. And that's definitely true. And well, one of the biggest things that he did was, and unexpected and abrupt crackdown on the major internet companies last year. And part of this was because basically unequal access to certain forms of education. And China has a huge inequality problem. And so Xi has been really focused on trying to reduce inequality and more diverse forms of inclusion, which means taking away a lot of advantages of the upper middle class families. And his part of the plan was to partly to redistribute wealth and rein in the private sector. Now, obviously, these are also the families that have the most power. And their descent to these sort of things made Xi pull back on the burner for now. So it isn't like he has absolute power, obviously. And it isn't that he can just do whatever he wants. And I think that is particularly true if it seems to threaten too much of China's economy. But he is certainly taking actions as I will talk a little bit later that sort of might be undermining China's economic miracle. So one of the things that kind of resulted from this that she mentioned in the article, but she also mentioned at the talk I went to is that sort of this crackdown meant that these companies laid off a lot of employees and are not hiring. And for the first time in years, maybe decades, unemployment has become a serious problem for the party. Unemployment is at a record 20%. And that is just something you have not seen with China's economic miracle since the since the 2000s. So this creates obviously political risk. And just this widespread discontentment in you have young people, right? Young people. Yeah, I mean, a lot of it is college educated, too. I mean, it's that combination of high unemployment, college educated that I mean, that's the form of a lot of revolutions. And yeah, and I think some of the ideological program of Chi is also really trying to address this problem, too. So he really has engaged in reviving at least in name a lot of Mao Zedong sort of ideology. And this has been really focused on these younger people and these these college graduates and this focus on tackling inequality is something that they definitely support. Yeah, I mean, that makes me think of the think there was an article in either the Atlantic or Vox that went into kind of the major influences of Xi in terms of his ideological focus. And one of those, which is, you know, well known, the fall of the Soviet Union having such a impact on that generation of China's leaders. And the lesson that he took away from it was that Gorbachev engaged in glasnost. So the idea of openness to Western ideas too early, rather than that the Soviet state was a corrupt husk of its former self and basically nothing holding it up. But from that, he was like, yeah, we have to double down. That's why the focus on censorship, the focus on ideological returning to Maoist, Marxist roots of thought and the propaganda and the political training that being emphasized for the first time since Mao really. Right. I mean, because Deng definitely wanted to get away from a lot of that again, because he had been the victim of those purges so often. Yeah. And then I was reading to you about the way that the Communist Museum and stuff like Xi is really sort of making himself out to be like the successor and equal a Mao Zedong, you know, in this sort of party mythology. And again, that really goes to all the signs of him becoming a more personalist dictator. Oh, yeah, for sure. I mean, it has his own book of thoughts out now right now. So they did have to cut back on that because people did not react very well to his little red book. Yeah, I don't get in the 21st century to go back to, you know, this sort of kind of crude, yeah, just kind of crude mid 20th century propaganda techniques. Yeah. Instead of, I don't know, coming up with memes and viral videos and TikToks. I don't know. I mean, they invented TikTok. He should be out there doing that sort of propaganda to reach the young people, not a dumb version of the Little Red Book again. I mean, it's been 60, 70 years, right? Yeah, I think and people still have really bad memories of the Cultural Revolution. And so that's why there was a lot of pushback because of the chaos that introduced into society. So yeah, it is interesting that he's trying to go back to that. Obviously, they are using pop culture and have for a while. I mean, movies and things about nature. Yeah, yeah. Yeah. I mean, the Wolf Warrior series, which again, is that sort of where you have the private sector coming in with the government. And that's effective. That's like a modern way of thinking. I think the other memes that they've done, but the only one that's coming to mind is that the badass Biden one where he's on a Iron Throne. It was actually picked up and used for Dark Brandon. But so I think some of that kind of over my head because I don't see a lot of Chinese propaganda. There's still not quite a depth at it yet. I think. Well, you have to also understand, I mean, the country is run by very old people, right? Yeah. That was the thing about the social media. Is that all of the people elected are just way too old to become cheese successor, right? And so, you know, he got rid of automatic retirement age. And so you have, you know, more older people in power. Yeah. So that aspect is definitely there and concerning. And but, you know, we'll see how it plays out. I mean, I think that's the thing that's always interesting about the Chinese system is that, you know, it has to be a contract with society. I mean, too much discontent definitely threatens the party. And that's why the party before Xi had been more responsive. And it seemed to be on the track of going more responsive to the distance concerns. Yeah. So were there, I'm curious, were there any signals around their COVID policy? Because that's probably the most controversial, both from kind of economic and openness and also unpopular, at least, you know, the way it was executed in Shanghai. Are they keeping that up? You see that? I mean, did they make any pronouncements around that where zero COVID is still seen as a core goal for party legitimacy? Yeah. So another surprise was that there was no sign that they're going to end their zero COVID policy. A lot of people thought that they would try, especially with some of their economic problems, that they would, you would see some signal of how China might be moving beyond the zero COVID policy and kind of treat it like the rest of the countries, which have just moved on from the pandemic. But I think, you know, in the articles I read, I think didn't also, though, really address the fact that, you know, the Western countries have developed countries have been able to move on because of the strains, while more contagious or more mild, and that they have strong vaccination programs, right? Whereas China does not have that sort of vaccination program. And so I still think that that she bets on stability. And with all the discontent and economic problems that it's led to, I think he fares that if COVID were allowed to spread, then it would overwhelm hospitals, because there's no way to prevent it from spreading in the same way that vaccines have helped, you know, slow down at least the hospitalization, right? So actually, I mean, we have huge numbers of people getting infected, but, you know, not huge numbers going to the hospital. And that's because of the vaccinations. But if you don't have that basis, because the Chinese vaccine was not very good, and they haven't opened up to any sort of foreign vaccines, and such as my understanding. Unless they develop their own mRNA vaccine domestically, they're going to take this policy of lockdown. I kind of don't know if they have another choice, because widespread instability due to that, I think, is worse for them than any economic class. Yeah. Yeah. And if you can accept a EU or US vaccine, you admit ideological defeat in your systems inferior. Yeah. So I've given this a lot of thought because Shanghai kind of surprised me in the sense that not the cruelty of Shanghai, but the fact that they were willing to risk the economics of this hub. And I spent a lot of time trying to figure out why, because I also things are not as clear energy, you know, this economic miracle, the economy is still part of the foundational contract. And, you know, why would they jeopardize that? But then I was thinking, well, if everybody in Shanghai is COVID and you overwhelm the hospitals and you see people dying, then that's worse for the economy and then worse for stability. That's certainly my take on it. Yeah. No, that's a good point. And I mean, and she has deep roots in Shanghai, right? That's where he worked with. Who did you mention that he promoted? Lee Cheung. Yeah, because I know they work closely together when they were both based in Shanghai. So it's kind of even more of a mixed, you know, at being the home region for for she. A lot of people, I mean, if there was a surprise, there was a lot of people surprised that he rose to be the second in power premiere when he's so unpopular. Right. And the Shanghai did not go well. And on the sort of social contract, one thing that people were mentioning, and I do find slightly worse than instead of focusing on economic gains, you know, she seems to be trying to create a new contract that focuses on stability and projections of Chinese strength. Whereas, I mean, obviously stability has always been important, but the economy, you know, promising economic wealth was always more important. And now she seems to be backing away from that. I mean, in some sense, China has already led, you know, that huge path of people out of poverty. And in the current situation, people are not in the generation going from that stuck poverty to middle class. So in some sense, no one mentioned that, but that certainly could be part of why she feels like there needs to be a new social contract. Yeah. And I think it makes a lot of sense to reset expectations around that, particularly given they're in the middle of a real estate bus as well, which is the majority of Chinese wealth is tied up in real estate. So if you recenter it to the economy and personal wealth and maybe focus on inequality, then you're less likely to take the losses because you've reached that demographic peak too, you know, given the low replacement rate and aging population. Yeah. I mean, most economists now think the Chinese economy won't surpass the US until the 2030s, if ever, based on this, the current path. Yeah, which is kind of amazing given all the hype about like it would be next year. So people do so emphasize purchasing power, right? But I think that's not the same as absolute numbers. And it's also surprising just because of how many more people China has, you would expect the economy just from that perspective. Yeah, four times as many people. Yeah. But the one thing that people point out is you have to be careful to not overestimate China's economic problems. Sometimes in the West, that's kind of, he's been tempting to say, oh, this is peak China, but there's no real basis for that. So I think always is that balance between acknowledging there are economic problems for sure. And she may be responsible for some of them, but that doesn't mean that China is just going to be in a downhill trajectory for now. I mean, they definitely will still grow their economy and grow their economic influence. But the focus on stability is a classic dictator move, right? That's the number one thing they usually promise to the people stability. So again, all these trends toward a personalized dictatorship, which is just something that is pretty unforeseen in China, given the way the structure is certainly disturbing. On the other hand, like I said, you can go too far because he is still a pragmatist, right? When the internet tech sector declined after he had that crackdown, I mean, he withdrew a lot of his plans. He backed down, right? He's not going to pursue his agenda like the way Mao pursued it, despite the economic class. He is still a pragmatist. It's just that now you don't have those private market, private enterprise people really being able to, there's no voices to say, well, what about this? Maybe that idea is not completely correct. And now it's all just purely yes, men. So it'd be interesting to see if this changes his assessment of what's going on in his path to it. One thing Shirk also said is something that I think over and over again, I believe, and hear from China Watchers and China analysts, you know, because she's very, she's like, look, I have a lot of in-tip-the-pea for the Xi regime. She's like, but we still need diplomacy. And she's like, I feel like the problem is we've given up on diplomacy and we haven't had real diplomacy for six years, and that we can't just feel like there's no places where we can find any cooperation on. But both countries are more and more acting like that there are no areas of cooperation. They're just going to be this competition. So that's the problem. I mean, I think that problem on both sides. And I think, you know, it's kind of disturbing the way the US and China's relations are now just kind of almost tip-for-tut or reactionary to each other instead of, you know, this idea of, in the beginning, Biden, you know, made some words to like, let's find some cooperative areas. And the Chinese have been saying that as well. But now there's just the sense of no, we're just, you know, the US is just out to get us. And, you know, and then from the US, but that China just takes advantage of us. And it's not creating any room for diplomacy. And then itself is pretty dangerous. But her perspective is there is, you know, there should be room for diplomacy. And if it's not, we should at least try it. You know, maybe it wouldn't work. Maybe China's so hardened that they would refuse to cooperate. But we haven't made significant overtures in that manner. Yeah. Yeah. One thing that I read recently that was related to that and kind of this, to your point, kind of the lack of cooperation or agreement between the two countries was on LNG exports, where China is interested and wants, you know, even more natural gas from the United States. But you've seen pushback from members of Congress, I think primarily on the Republican side on those sales. So actually intervening and preventing additional natural gas shipments to China for the strategic, which is insane for multiple reasons. One, the one area we should definitely cooperate with China is around climate change and climate mitigation and taking those coal plants that they've had to turn back on by providing natural gas is certainly in our interest. And then obviously economically, very much in our interest. And then to time them more dependent on US energy, that's a good thing strategically. I can't even think of like why you would feel that that's negative, like militarily or anything. Yeah, that's why I was definitely bewildering. But that I think it's just a testament to how much the anti-China sentiment is taken over that doing any business with China, even if it's to your strategic and economic benefit, that you would push back on. So it's a little bit crazy. So I think maybe that that's just the environment that we've now reached. Yeah. And she said, she thought that at this point, yeah, that environment, that everything's a complete overreaction to the threat of China's. And I think it's economic and military. There's a lot of alarmism. And in a certain sense, we have lost our confidence in our own strengths, which we talked about. But also that sense of, okay, we're not going to do any business, even if it's on our strategic interest, which is just a really harmful perspective. Just real briefly, as I sort of mentioned before, one thing that did surprise people was really notable that certain phrases that China has used for the last few decades about this is a strategic opportunity for growth and continued development for China has now been replaced for a much darker period and was sort of replaced with that we're entering a period of strategic opportunities, risks and challenges, and that we must be prepared to deal with worst-case scenarios. So this phrase is like a phrase of strategic, just saying strategic opportunity period to the docker, which is now using phrases such as ensuring both development and security. There was a security was mentioned like 90 times as opposed to the last party congress report, which was like 60 times. So there's a lot more emphasis on China needing more security in sort of the international environment. One thing that was also interesting to me is as part of that was taking actions that there's a need for take actions like countering sanctions, stockpiling food, energy resources, ensuring supply chain security, and also raising the overall public awareness of these threats. And basically, I'm teaching a class on industrial mobilization, and these are the things that the US is very sort of focusing on itself in mobilization that in case we were attacked, then do we have enough energy resources? Do we have enough weapons that could survive attrition? How would we be able to still make things in supply chain security? And so it's sort of interesting the Chinese having that similar response. And on one hand, people argue that could be deterrence, but it also can be a sign of aggression. And I think it's continuously this sort of dangerous moment where we're constantly responding to each other as our biggest threats. So I thought, I mean, some of it is an accurate assessment, but some of it, as we're seeing, can lead to, again, I just feel like the US and China could start being engaged in this cyclical, I mean, I guess that's why people say maybe in the Cold War, where they just continuously focus on each other as a threat and try to up their sense of mobilization for war and preparation for war, which doesn't mean that you're preparing to attack the other country. So I think that's really important. But to see this sort of arms race, but mean mobilization rates, like learning the lessons from the previous wars. So I thought that's kind of depressing. Significantly, there was nothing new on Taiwan. And it was not mentioned or included in the 2027 or 2035 goals. So nothing has really changed there. Switching to, you know, sort of our own industrial mobilization. One thing that really struck me by reading a Fareed Zakaria article a few days ago was sort of, we look at China's economic success that has been based on different principles. And this industrial policy of China, we assume that that's part of China's economic success, but it's really relatively new and could be undermining Chinese economic expansion. And so is it really a good idea for us to abandon our typical free market approach to just responding to China with our own industrial policy? Yeah, no, I like that Zakaria piece too. I didn't entirely agree with kind of the analogy to Japan, because it was the last time we had sort of industrial policy. But yeah, you know, the analogs, the idea of, you know, 1990, everybody was so focused when Japan had absolute peak of its market, I think on the real estate side, Tokyo real estate was worth more than all of California. It was just this period kind of built around this fear. And of course, the ministry of MIDI, I can't remember that ministry of industry and technology, but essentially it was a central planning agency that directed Japanese investments and research and development. But it was this big industry. And a lot of people were like, hey, we got to emulate this in order to compete. So I mean, I like that idea of, yeah, you know, we've had this history of alarmism, but they're not quite the same either just because of the scale of China, the ideological differences. But you know, I thought that part was refreshing. And then the idea of, yeah, maybe industrial policy isn't going to be successful in China. I mean, they're putting a lot of R&D into things like quantum computing and sort of these next stage sort of technologies. But is government led direction really that takes, especially as they're cracking down on private sector innovation, private equity and things like that? I think, you know, in some of the pieces I read, it's still a mix where it's, you know, government funds going into, but the market is ultimately decides who the winners are within this technological competition within China. Which is sort of the model the US is following too. Right, yeah. In many respects. And so the point was like, well, that we attribute this industrial policy as part of China's economic success. And it may be really hurting its economic growth potential. Yeah. And it's, I mean, I don't, you know, it is a complicated because we ourselves point to the government investments and early research, and maybe this is different than industrial policy. But obviously, like the internet, all this sort of core stuff that maybe the Department of Defense invested in that later became, you know, entire sectors within the economy. So there's a distinction, right, between kind of fundamental research and development and industrial policy. Am I getting those confused? Right. No, I think some parts of industrial policy that people point to is certainly the subsidies to finance the building of the semiconductor factories. Like that's not just money for research, although there was a lot of money, but the actual building of the factories are certain subsidies to build them. Right. Essentially the same thing. The sort of export restrictions are definitely industrial policy. Yeah. We now have on certain types of semiconductors, you know, the economist, and then when you take in like the green energy program and the inflation reduction bill, it makes the U.S. one of the most state interventionist economies in the Western world far more than France, which is normally takes that, takes that. In fact, there's a lot of reaction. So one of the principles of that is that U.S. consumers get subsidies if they buy American electric cars, which then has Europe and South Korea furious. Well, assembled in North America. Right. So they could be a Toyota manufacturer, but as long as they're built in Tennessee, you're still getting that. But if it's built in Japan, you're not, you're not getting that subsidy. Right. And they do still sell cars built in these, I mean, yeah, it violates the trade organization rules that we want. Yeah. Right. Because you're not supposed to discriminate against other nations. You're supposed to allow them to compete. Yeah. In your own market and France and Germany, who've had a lot of tensions lately, continue to do so are pretty united and threatening to have retaliatory sanctions on the United States if we go ahead and do this. So huge violation of sort of the free market world trade organization that we set up and just part of where this economic nationalism may be going too far. Yeah. Yeah. You know, I found that really surprising. I wasn't aware of those provisions within the IRA that really focused on kind of that American sourced. Because in my mind, I'm like, yeah, I get the anti-China, but we should be sporting our allies. So the allies should be included within it. But instead, yeah, it was this very nationalist, Trump-like sort of provisions. And I definitely seen, you know, there's a lot of criticisms from the Republican side on that because they did support certain components of the IRA. But I know on the regulatory side, you know, a lot of it was also... But they didn't like a lot of the green energy period. Well, yeah, they didn't like that component. They didn't like some of the additional regulations which favored minority and women in terms of some of the subsidies. But the economists mentioned that too, is kind of an inefficiency and creates a lot of paperwork within the markets as well. So it would be interesting to see... I mean, not that they could do it even if they take back the house, but what elements of that this bill they would seek to reform? Yeah, I mean, I think the US is now trying to sit down with the EU and sit down with South Korea to address their concerns. So it's hard to see if they stick to this very strictly, that how they will do that. So I feel like there will have to be some compromise on this. Yeah. Yeah. So that's part of it. One thing going back to almost the China's semiconductor part is one thing I felt that was interesting, and they said a novel step, is the way that American US persons are including American factories, but also those who work in foreign factories overseas cannot be involved in the production of advanced chips in China. So one of the consequences of this is you had international companies and American companies saying they're not all run by Americans, right? I mean, even American companies, but all the Americans had to stop work completely until they figured out the exact regulations. This could be a problem because then these are especially the international companies who, this is where their main violation is of the rules, may just fire and not hire any more Americans, but still continue their role in advanced chip manufacturing in China. But that was pretty extreme and something I hadn't known about the export ban or that particular part of it. So I think though the economic nationalism is problematic. I think we're definitely going too far on that. I agree in general that whenever we talk about China competition, this is what drives me crazy. We never include the war, include our allies. When we talk about mobilization or how we need to be prepared, we act like the US can do this alone and conflicts who your allies are often determinative if you win or lose conflicts. You can just see that in Ukraine, right? Russia couldn't have anticipated the type of resistant Ukraine has because it didn't anticipate the amount of military support and weapons and supplies that the West would give Ukraine. Yeah. So it is surprising. I mean, I get that Congress and crafting that bill had different drivers than maybe necessarily what the White House and our relations with other countries would. But given the success we've had and rebuilding alliances, particularly around Ukraine, but also around changing sentiment against China within these countries that we would step on our own feet around something fundamental like this, given the amount of money at stake and the importance to battling climate change, that this wouldn't be taken into account our allies' interest as well. Yeah. And speaking of the unification of our allies with China, I just wanted to mention a couple of things that were happening in Germany that were pretty controversial this week is that government gave approval for a Chinese takeover of a German chip plant. So while we're trying to have all these semiconductor rules in the US and trying to create them where our allies have to cooperate, I just thought this was really notable. And like I said, it was controversial through Europe and the United States that they would just allow Chinese to completely take over this German plant. And then also controversial is that they gave the green light to the Chinese state shipping giant Costco for buying a foothold in the container port of Hamburg. The compromise was that originally Costco was going to get a 35% stake and now it's like a 22% stake, but again, something that everyone reacted quite strongly to. So Germany I think is really bad at following security externalities, right? Yeah, no kidding. So they ignored warnings about relying on Russian energy. And now, I mean, even within their own government agencies, they opposed both of these moves and the German really separatist agencies. The spy chief was particularly against the takeover of the German plant for being able to still be engineering there. And then several different ministries opposed the buying into the shipping harbor. Yeah, this disappointing. And I saw similar headlines. We were just on economic matters. And I don't know if this is a function of the German economy suffering under its current situation with high energy prices that it feels like more than now than ever. It needs to have a cheap source of markets, one for its high end goods and two, cheap sources of other inputs into its manufacturing that it can't afford to isolate China to the extent that the US would like to see. So also interesting that we'll get more of a sense of this. Germany's leader Schultz is going to visit China this week or next week. I had trouble figuring out exactly and is expected to meet with G. So I guess we'll find out more about where that relationship is going. Is that the first time a Western leader has gone to China in a long time since COVID? Mm-hmm. Okay. So Schultz is the first time. That tells you a lot, probably. So we should have more in that. All right. That was a lot of China, but I felt like it was good. There's a lot going on, especially with the party congress. Oh, yeah, yeah. No, I mean, that was the big political event of the year. So it's important to cover that in depth for sure. All right. On to our normal update of Russia-Ukraine conflict. Yeah. So I think when we, on our last podcast, the Ukraine had just delivered a strike on the Crimean Bridge, and there's a lot of celebration around that. It was timed with Putin's birthday. Since then, there's been a pretty significant counteroffensive that the Russians have launched. You know, first, I think following that next week, that Monday, a series of cruise missile strikes from the Black Sea Fleet that targeted the Ukrainian infrastructure, particularly their electrical facilities. But they've continued these assaults. So it seems like a new strategy leading up to the winter to specifically target electrical facilities to the extent that the current estimates put the loss of electric power at around 30% country-wide. And Kyiv's mayor announced last Friday that the Blackouts could worsen as energy supplies within the capital are down 50% compared to pre-war levels. So this has been a heavy blow, I think, to Ukraine. They have managed to push back against that. But I think the biggest thing is a new focus on air defense support for them. And this is largely driven by the fact that Russians are running low on supplies from the effects of sanctions. They're certainly running low on the number of cruise missiles they have. So they had turned to Iran. They made a deal, particularly around drone purchases, of which they've ordered 2400. And it's really what the Ukrainian cities are seeing are these kamikaze drones, of which I think 300 or so sorties have been launched in the last couple of weeks. And they've been real effective in targeting electrical infrastructure as well as civilian targets. Someone pointed out, though, that kamikaze seems to be the wrong term if no person is involved. If no person is going to commit. Yeah. Anyway. So I guess it's just a distinction from the drones we deploy that are armed with air-to-surface missiles and things like that. So I think this has been a real challenge for US and NATO allies to deal with. And the Wall Street Journal really reported, and it's just the complexity of having a successful air defense. It's really this integration of all these sensors between radar and cameras and radio frequency scanners, and then coordinating that with the air defense system in place. Now, unfortunately, Ukraine has a real hodgepodge of air defense systems. So most of it are these big S300 anti-aircraft missile systems. Then you have the Stingers, so the shoulder-fired missiles, and then machine guns, and individual jets. So it's just very hard to integrate all these different systems from different countries into a single source. And it's something that the US apparently and its NATO allies haven't invested a lot in because it always thought in any sort of conflict it's engaging in, the goal is air superiority. And they felt pretty assured because they've invested so much in their air forces and being able to achieve air superiority. So I think this is a real challenge. And then the cost of it. So the cost of these drones that were purchased from Iran are only 20,000, and they require relatively little training. That's the other controversial thing is Iran has sent its own trainers up to Russia and are training Russians on how to pilot these drones. But Ukraine could spend, if it uses one of those missiles, it's spending up to $3 million to neutralize one of these. So it's kind of this cost. And it's kind of interesting because obviously the US introduced drone warfare. And that's definitely been controversial and how the US has used it and targeting. But this is the one where you really have pretty massive drone deployment. And then what are the defensive systems for doing it? Because they have single drones, but they're also doing swarms. And swarms can actually overwhelm air defense systems, even if you have them in place. So I think it's a real challenge that the US and NATO are trying to meet coming up ahead. But I think Kyiv's getting additional systems. They're trying to protect the capital as much as possible. But given the damage to electrical infrastructure, it's going to be tough. Especially as they begin to mount the offensive on Kherson, which was the other development you saw Russian forces seeming to retreat from that. So it's almost like they know that they're going to lose that city. But actually, an Institute for the Study of War report came out that there was expectation that the Russians would target this huge hydroelectrical dam in the area, which one would flood portion of that area since it blocks the DPRU river, but also could affect that nuclear plant. So the Zaporizhia nuclear plant, because they use the water from that dam for cooling the nuclear reactor. So it's definitely an area to look. I think that's expectation prior to winter really sets in is that there'll be a push to take Kherson back before then. So then you could definitely have these sort of actions coming up. Moving on to the Ukraine's obviously dealing with energy shortfall. Meanwhile, in the EU, the conditions have gotten considerably better since I think the last time that we talked about it. So EU originally had a goal on its natural gas of having 80% capacity of its storage prior to the winter. And continent-wide, it's actually up to 94% and Germany's pretty much maxed it out at 98%. And it really just reflects the willingness of the EU to pay almost any price for LNG supplies. And we've talked about before, part of it's freed up because of China's COVID policy, because of China's willingness to switch on coal plants. This LNG has been available as long as you're willing to pay for it. So that's helped EU, combined with the fact that October has been unusually warm in Europe, that they've been able to bring up the supplies to the point where even the losses of Russian gas from Nordstrom, from the sabotage there, shouldn't affect Europe, mind you, unless there's a very severe winter, they should be in relatively good shape. To the point where you actually saw negative spot prices during the week, just because it was unexpected that, one, you'd have this very warm weather in October, and two, that capacity levels for all these storage sites would be so high. So unfortunately, none of this translates into real price relief for the consumer. All natural gas is kind of long-term price. But in terms of shortages, in terms of the whole painful debate we talked about, of industries having to shut down a witch EU country would have to bear that burden. That's looking less and less likely. That being said, Germany's still feeling it. Prices are still seven times higher than last winter. So you had another industry, it's a big chemical company, BASF, officially announcing that they were going to have to close down their presence or a large portion of their presence in Europe due to high gas prices, with their cost being nearly $2 billion a year higher. Right. That's a good point. So yeah, that's relatively good from a supply side. Again, consumers are still going to suffer. And then the final update was on Putin's think tank beach that he delivered. So this was at the Valde discussion club in Moscow. And it's something that Western researchers and leaders used to attend. So in fact, Dan Drezner attended in 2016, he really described Valde as a swanky high level conference put on by the Russian elite. And it's really the highest profile Russian equivalent to Davos. So it went ahead this year without Western attendance, did have leaders from Asia, so from India, Pakistan, and China, and Indonesia. And in terms of the messaging, it was useful seeing how Putin was framing it, particularly around his appeals to the far right within the West. It started off as really covered a lot of the talking points that he's covered for more than a decade. That Russia is a champion of rising nations in this new multipolar world. That Russia stands as a defender of traditional Christian values as society has lost its way. But the part that I found interesting was the feedback loop that exists between Putin and the far right in the US and in Europe around language use and the term. So in this speech is really the first time Putin is sending as clear a signal as possible to his allies in the West, talking about cancel culture, talking about gay parades, talking about gender identity. I saw Tom Nichols and his piece in The Atlantic really describe the whole cancel culture concern. Putin framed it with a Russian twist to it. But there were a few, ultimately, were discussions. So one Italian university, and briefly the Boston Pops over the Fourth of July, talked about not including the works of Dostoevsky and Tchaikovsky. Sorry, I didn't pronounce that right. I don't know. I know it's not pronounced that way. The Russian famous Russian composer of the 1812 overture. All this, you know, they ultimately didn't ban or they backed away from. But Putin's been using it as, oh, look, the West is trying to cancel all of Russian culture and things like that. But then the idea again, along those same lights, basically sounds like a Tucker Carlson piece. And of course, we all know Tucker gets broadcast on Russian state media all the time. But it's, oh, all the problems are due to this cosmopolitan neoliberal elites and trying to appeal, you know, Putin's appealing to the good people of the West that, you know, oh, we've got to stand up for these traditional Christian values about freedom and patriotism. So he's gotten rid of the dog whistle and basically just using the same language. One of the things that I read on Twitter was that we should ban Russia's access to the far right media so that they can't just steal the talking points. Yeah, yeah, it's just like reinforcing. So they can't have Newsmax or Newsmax, Fox, opinion hour, all that. Yeah, I thought that was a good take. Yeah, no, for sure. So really, I mean, ultimately, it just represents another front in the war. Really, it may be a marked desperation, they asked to turn to this, but I think it's effective in a lot of ways to really break Western unity around support for Ukraine. You've seen sort of gaps. I think the things that have emerged recently in the past couple of weeks. So the Italian leader we talked about last time, the far right party that won the parliamentary elections there. One of the core components of this coalition is our good friend, Berlusconi. So he got caught and recorded audio tape talking with party members, talking about the sweet letters that he and Putin exchanged. I don't know what it is with letters and autocrats. Same thing with Trump. They're sending themselves love letters all the time. I want to read these letters. We never got to see the letters between Trump and Kim Jong-un. They haven't been able to find them. Yeah, that's their super secret. I want to see what they write to each other. Anyway, it obviously sits in a very close place in his heart. But I think the key controversy that came out here is he was very explicit and blaming Ukraine for the war. That Putin was just protecting native Russians, that he was forced into this. So Berlusconi's governing coalition actually had to do a lot of damage control coming out of that because they won on the basis that they're going to govern from the center, that remember they have a lot of money at stake in terms of EU relief. So this is a huge embarrassment. I mean, big surprise that 86-year-old Berlusconi is saying whatever he wants and loves Putin. So maybe not a crack there. We'll see. And then in the US, I think you saw a couple events around, you know, one was the release of a letter from the Progressive Caucus headed up by House Representative Pamela Jayapal. They were almost immediately forced to back down because the letter appeared to advocate for isolationism and direct negotiations with Putin. So the Democrat leadership really cracked down on that and they drew that. But then the other one of more concern was likely future Speaker of the House following the midterms and expected Republican victories. Kevin McCarthy came out and questioned future aid and the need to rein in spending in times of a recession. I think it was just really endemic to the fact that you have a coalition of mostly America-first Trumpist Republicans on the House side that are likely to come in in the selection that have voiced very strongly anti-Ukrainian. More from the perspective of, oh, we can't afford this. Why are we getting involved in certain affairs? So beginning to fund, I was surprised to see during the World Series, there was an ad from, I can't remember the name of the pack, but essentially it was a far right backed ad that was saying, oh, we're bringing about Armageddon and nuclear war through the support of the Ukraine. Somebody has to cut them off of money. But the fact that you're seeing that publicly, you're seeing this from big money groups and you're seeing that supported from candidates like Blake Masters and JD Vance on the Senate side who will, it's a toss up for both of those races, but at least several of them are when showing that Putin's overall strategy of attempting to influence these election and break the unity of the West is a viable strategy. I think people have been waiting for this to emerge for a long time, but maybe it wouldn't emerge until after the elections because of how sympathetic the far right has been to Putin the whole time. And so that's why I think it's really notable Kevin McCarthy's statements, because even though the far right is pretty the mainstream of the Republican party, Kevin McCarthy is certainly been the sort of representative of the party. And so when he starts saying things like that, it indicates a clear direction. So yeah, I think it's hoping for this. It's a large enough part of the Republican caucus that he doesn't feel like he can ignore it. I don't know if in his own district, probably constituents might push back enough on it. I don't know. But yeah, it's definitely a concern. It's creating a lot of concern in European capitals on future support because obviously the House alone can hold up any future provisions. Right. You know, it's crazy to me is how unified people are on China, who has not started a war, whereas there's so much split on Russia, which did start a war. And I think Dan Nixon had a Twitter thread. He's a famous IR scholar or well known IR scholar, and was just talking about war typically ends with negotiations. The problem with negotiations right now is that Putin gets to claim still a lot of territory if the war was going to end now. You know, we don't want to reward Russia with a victory. So and he was responding more to the progressives. I think everyone's disturbed by the right and that they're already before the elections are even held indicating what you think would not be a popular mainstream reaction. But they don't seem to be too worried about maybe not continuing to give Ukraine aid in the future, which would be very detrimental to their ability to continue to resist Russia. Yeah, exactly. Yeah, it's very concerning. And there's a split between McCarthy and McConnell because McConnell came out saying, I know this is the, the, it's funny where McConnell was like the anti Trumpist. He always loses. I don't even say anti Trumpist. I think McConnell is the old school. He's still the old school Republican party. Yeah, that I mean, not as much as like some of them are like Romney, but more the old win at any cost. But then it's like, but I can't deal with this far right trend. Right. And but McConnell's been continuously on the losing end of that. Yeah. So I don't really see him being able to stop Republicans from cutting off aid, which like I said, be hugely detrimental. Yeah, for sure. And definitely against our national interest as well. But we'll see how this materializes not great signaling at all. Yeah, really disturbing. Yeah. So I have a few quick topics that we wanted to end with. The first of these I just have been really wanting to mention is the Iranian protests. So most protests like these, you know, rise up, we're used to having protests last for like a couple of weeks or a month, but it's really striking that the protests continue to grow and have been now for more than 40 days. And that's despite increasingly harsh crackdowns, which include live fire into crowds. So several people have died from that. You know, one of the articles I read called it the most serious challenge to the Islamic Republicans since its inception. And just once again, to just note how different this is sort of from the other uprisings that we've seen and in the green movement and others where you have large protests, mostly of young men. And like I said, they're very intense for a couple of weeks to a month. But the sort of enduring power of this and the imagery is completely different because these are being led by women and younger people. And so one of the things that had prevented some of these tactics before was the idea of, you know, these people firing on women, you know, and killing women, which is very different. But so the party is very frustrated at the ability to suppress these protests. And like I said, it's not just firing into the crowds, but they have been arresting a lot of people, people have been dying in custody. They're using pretty harsh tactics, but now is expected that they will use even harsher tactics because as of yesterday, the head of the Revolutionary Guards in Iran warned that Saturday was going to be their last day of taking to the streets. And so people are kind of worried about what we'll see next and that they definitely seem to have a plan for a much fiercer crackdown on these protests. So I mean, it's, yeah, it's an interesting trend. You know, we've seen so much far right stuff and we talked so much about the far right and to see this expression, this continued expression for personal freedom. Yeah, basically, in how this isn't going to be something very, it won't, it probably will not bring about democracy, but it's not going to be something very simple that the Iranian government can just squash. I think even with these harsher tactics, maybe the protests will be smaller or in different ways, but I think it's not going to be able to squash the movement itself. Now, I mean, it seems really remarkable and yeah, and hopeful for Iran's future. It would certainly, you know, if you were able to eventually bring down that regime and have something closer to a democratic government that would be enormous strategic victory for the United States. Yeah. And the harsher, you know, there is always the danger for governments because the harsher you are in the crackdowns, the more the public sentiment is against you. Right. And so it remains to be seen what happens here. But I mean, clearly, I think the government has stemmed its hand somewhat because of knowing that, not wanting to increase discontent from the public, but at the same time just watching these protests grow is threatening their security. So it's definitely something to keep paying attention to, something to admire. I have the greatest admiration for these women and others who are protesting with them, knowing the danger to themselves and their families. There have been several across the world, there have been several solidarity marches in Europe and Canada. Trudeau showed up to the Canadian one, I think this week. We have trouble, United States keeping momentum of protests when we're not an authority that's trying to stop them. So just this groundswell and these people just insisting on some basic freedom that they feel like they're that they're owed and sort of the waning of absolute authority. I mean, obviously they can still exercise power, but it's definitely something that is challenging their power and it'll be important, I think, to see where this goes from here. Yeah, yeah, that definitely would be very inspiring. Right. Now we have a couple of elections to talk about, although I'm not sure UK really talks is an election, but it is a new prime minister. Yeah, well, I guess internal elections. So it seemed like last time we just introduced Liz Truss as the new prime minister of the UK, talked about her not well thought out policies. And hey, sure enough, she was forced out because of the extreme reaction by financial markets was such a disaster that she announced a resignation after just six weeks. So I like the economist quote, Ms. Truss is contender for the title of Britain's worst prime minister on a damaged done per day basis. She has no peers. So I mean, come on Chamberlain. I mean, really, I can make a lot of really bad Chamberlain was in there for a while. Seriously. But yeah, I agree. That's pretty bad when you beat Neville Chamberlain. She doesn't. I mean, she has a really bad plan. I think that's ridiculous. And it's a sign of how UK media is toward towards the economy. There's sober. This isn't like the Daily Mail or something. So, you know, following some early contentions that maybe Bojo Boris Johnson would be back. He fortunately and the challengers and the internal kind of Tory leadership selection process dropped out and Rishi Sunak, so the former finance minister under Boris Johnson had run against us, right, who ran against trust and the original leadership. And he was also the one who kind of kicked off the collapse of the Johnson administration when he resigned following the conspiracy. So it took a little while for this to kind of pay out for him, but it's definitely paid out. So he emerged unchallenged. I think this was seen as important because you had decision just among the MPs because everybody dropped out and running against them. And it never went to the greater party membership. I think that's how they ended up with Liz Truss in the first place was because all the party members within Tory's got a vote on it, which is hundreds of thousands of individuals. So, you know, it was unique. You know, Sunak is the first prime minister of South Asian descent within the UK. And he's a former Goldman Sachs banker. So he's much more kind of buttoned up and seen as more of a technocrat kind of in his viewpoint. So a lot more pragmatic. He's also the son of immigrants and husband to Ashkata Murdy, who is actually the heiress to emphasis, which is one of the largest IT companies in the world. So his net worth is greater than the world of families and have about 730 million pounds. So that's kind of unique. I feel like we've had that experience before. Plutocrats really. We have. But he's also the youngest prime minister. He's also the youngest. Yeah, just 42, which is unique. So the economist made notes of his inexperience. So he's only had seven years as an MP, but just the fact that they had so much purges within the Tory party around Brexit that allowed him to kind of rise to power at this very accelerated pace. So the markets have reacted positively to it. The yields fell on government bonds. There's not a lot of details on what he'll do exactly. I think his prescriptions for growth are mostly sensible from the economist's take on it. In terms of investment, he's still talking about tax cuts, though. Nobody knows exactly how those tax cuts will be tailored. But cutting back on services. Yeah, but also essentially the new finance minister has already been asking for both defense, which I was surprised by, and health to cut 15% from their budget. So that type of austerity is not going to make the Tories any more popular with voters given the high energy prices and general suffering that the UK population is undergoing. So I think given this low growth rut that they're in, and unless they can turn things around that Tories poll numbers will stay extremely low. And I think there's going to be more and more calls to have a early general election that that's going to get harder and harder to ignore every time. Because again, we talked about last time they have the flexibility up through I think 2025 not to have a general election. But I think if it becomes so unpopular that they may be able to break that and be forced to hold one, which actually would be the better thing given how dysfunctional the party is. Yeah, I've been reading on that though that it's kind of crazy because normally you can't have one within five years. Like it hasn't been that long since they had the last one. Yeah. Yeah, I think it was 2018, 2019. Yeah, something like that. Yeah. Yeah, so in kind of wrapping this up, I did want to correct the earlier statement. So the budget cuts are targeting other agencies besides health and defense for those 15% cuts. So health and defense, which makes a lot more sense now. I thought you were going to mention that I pointed this out. Yes, and Anita did point this out. So we wanted to make sure that that was corrected before moving on to our last topic about Brazil. So that election is actually being held today as we speak. And as we mentioned last time, so this is the second round of the election between Lula and Bolsonaro. And polling has tightened up considerably. If we recall in the first round of elections where you had, I think 11 people total running, Lula had 48% of the vote. Bolsonaro came in as surprising like 42 or 43%. Current polling has Lula with just a four point lead, so 52 to 48. So Bolsonaro has been running a campaign focused on getting more of those swing voters to, particularly focused on the state of Minas, which holds about 10% of the population within Brazil and kind of represents a microcosm. It's kind of what Ohio used to be in the United States, but isn't anymore. But it's just, it has like a mix. It models the national polling and national results. Yeah, ethnically, it's similar. You have the poverty level is similar overall, because the region itself is very, very diverse. So it has these diverse pockets. So I think it's still unlike Ohio in that respect. Well, yeah, yeah. Ohio is never diverse. Well, not like this, not the same exact. You had religious areas, you have less religious areas. And there's really quite striking how diverse this one. Yeah, that's true. So I think as this election has worn on, there's been a real focus on more ruthless type of tax. And a lot of it is taking the signaling, I think, from US elections and talking points again, where this certain far right thought process and language use kind of spreads around the world and affects other countries. So you have seen, I mean, it's really reached kind of the bottom of the gutter at this point in terms of in terms of the focus of the campaigns and how each candidate is framed. Lula, who I read, was kind of viewed by certain Bolsonaro supporters the same way that Hillary is viewed by the Republicans and right here. So really a demonized figure. So that's gone to the point of how corrupt he was, again, from the ended up being without any facts is his conviction originally and jailing for 19 months around the Petrobas scandal during his original reign. But basically framing has a corrupt, godless communist and a Satanist. Meanwhile, Bolsonaro is being framed as a fascist dictator, which is closer to truth. But then a little definitely more out there as a pedophile and a cannibal based on his couple of quotes, which have been running and attack ads on Brazilian TVs, saying that, you know, his quote is saying there was a spark between him and a 14 year old Venezuelan girl. And then saying in a 2016 New York Times interview that he would like to eat an Indian. It's pretty clearly that he was joking and was referring to his willingness to engage in cannibalism with the indigenous tribe in the Amazon, of which the tribe itself has no history of engaging cannibalism. So it's more kind of racism on his part. But you can just see this is kind of the stage of where the election has run. It's become enormously divisive within Brazil. And I was surprised there's been over 200 politically motivated attacks within the countries between July and September. And actually 21 deaths have been associated, you know, strictly around this level of political toxicity, which you haven't seen in Brazil before, but has exist now. There was a point this week. So the Washington Post actually reported that the Bolsonaro administration thought about postponing the election based on claims that the radio stations gave more airtime to Lula over Austin era's campaign and violated Brazilian law. Because I think they have that Fair Rights Act that the US used to have in terms of each political ideology would get equal airtime. But key military leaders failed the back of plan. So I thought that was kind of interesting that he was already trying to pull the cards that we talked about in terms of like delaying election. Of course, all that remains true that he's run a long campaign saying any result where he doesn't win is the legitimate. There's still very the likelihood that if he does shown to be lose that he'll refuse to lose office that he'll try something similar to Trump on January 6 or worse. But it's not clear he would have the military support to have a successful coup. Right. Right. Which is something we kind of talked about. So yeah, I think, you know, one thing that kind of stuck out to me is that previous to the runoffs, the right gained a majority in, right? Right. Right. And so if Bolsonaro wins, then you'll see an even stronger sort of far right coalition, which will mean probably like further degradation of the rain forest organization of Brazil to disassembling the democratic institutions. Right. So we'll see that. Whereas because of that, if Lula wins, then you'll see a more centrist government because he definitely will have too much challenges. And it will kind of be part of the general trend then of the more leftist leaders in Latin and South America. Yeah. Yeah. So very important election will be very telling to see how it goes. Yeah. We keep having these shows like on election days, but unfortunately we won't know the results until you'll know the results before we will. So yeah. All right. Well, that is a very packed show. It was. We covered a lot of good topics. Yeah. That was great. I guess this is what happens when we do it during daylight hours. That's right. I think that brings us to the end of this episode of Kellogg's Global Politics. You can visit our website at www.kelloggsglobalpolitics.com and follow us on Twitter @globalkellogg or me, @arkellogg. You can also reach us by email. So anita.kelloggsglobalpolitics.com and myself, ryan@kelloggsglobalpolitics.com. And as always, please see our show notes for all the articles we discussed in this episode and leave a rating and review on your favorite podcast provider. Thanks, everyone. Thanks. Bye.