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Biden slams Nippon Steel deal — but Tokyo plays it cool
US President Joe Biden on Thursday came out against Japan’s largest steel producer acquiring Pittsburgh-based US Steel, saying America must “maintain strong American steel companies powered by American steelworkers.”
Nippon Steel made an offer worth over $14 billion in December, and shortly afterward the White House indicated it would be scrutinized by the Committee on Foreign Investments in the United States. For now, the deal is still on, but CFIUS review is usually reserved for deals involving companies from potential adversaries – not from trusted allies like Japan — and presidents rarely comment before the committee finishes.
But this is 2024. Biden and presumptive GOP nominee Donald Trump are battling over blue-collar workers in key swing states like Michigan and Pennsylvania in November. Trump promised to block the deal “instantaneously” during a meeting with Teamsters earlier this year, and Biden has never been shy to flex his union bona fides.
How does Tokyo feel? Discretion seems to be the better part of valor for Prime Minister Fumio Kishida.
“Tokyo understands that in love and politics, timing is everything and that the political timing of this deal is awful for Biden,” says Eurasia Group’s Japan analyst David Boling. “That doesn’t mean that Tokyo is happy that Washington is treating an ally this way. But it’s not putting up a big fuss.”
Should Canada give three F’s?
You’re leaving your role as president of the Canadian Chamber of Commerce after 17 years, which has been a transformative time. What is the biggest economic challenge facing Canada's trade with the US?
Perrin: The politics of trade has undergone a sea change in the US under the last two presidents. Previous presidents, from Ronald Reagan on, viewed America's interactions in the global economy as an opportunity to foster American prosperity, and they saw an integrated North American economy as a source of strength. More recently, however, US politicians have started to turn inward, increasingly viewing their country as a victim, and not as the primary beneficiary of international engagement. This change has led them to increasingly align themselves with domestic protectionists who want to build economic walls along the US border.
Unfortunately, this turn inward has coincided with a complacency here in Canada about our most important bilateral relationship. Even the best of friends can't afford to take each other for granted, or they will soon drift apart.
As Canada's relationship with the US has moved from being strategic to being transactional, American leaders are increasingly looking at each issue as a standalone, and they are making their decisions, not on what is in America's long-term best interest, but on where they can find immediate political advantage at home.
We need to rebuild that strategic relationship. It's vital for Canada to be seen as bringing solutions to the major problems confronting the United States, as opposed to simply pleading to be exempted from the latest punitive measure. We need to demonstrate, both in Washington and far away from it that Canada should be treated not as a problem, but as a partner.
Perrin Beatty, outgoing president and CEO of Canadian Chamber of Commerce. REUTERS/Rebecca Cook
You recently said: “Canada is increasingly being viewed by our partners in the region as a well-meaning but unserious player on the international stage." In what ways has Canada become an "unserious player," and what needs to happen to change that reputation?
Perrin: Unfortunately, we have come to see ourselves as a moral superpower whose job is to tell everyone else what they are doing wrong. And we expect them to be grateful to us for it. Too often, we are driven more by a desire for good feelings than for good results. In contrast, other countries are both faster-moving and more engaged in the issues their interlocutors consider most important. The consequence is that, where the US and other countries used to ask, “How do we get the Canadians involved?” their question is now, “Should we inform the Canadians?” The fact that we learned about the AUKUS agreement at the same time as everyone else is just one example.
The Russian invasion of Ukraine two years ago should have been seen by Canada as world-changing, and our response should have been both meaningful and swift, with us marshaling what we have to offer in defense of the democracies. For example, Canada has an abundance of the “three F’s” – food, fuel, and fertilizer – and critical minerals that are essential to global stability. What we lack is the infrastructure, the vision, and the will to bring them to global markets to give countries an alternative to sending dollars to despots. This could be Canada's moment, but only if we are prepared to seize it.
You were a former defense minister under Mr. Mulroney, so you know about dealing with a dangerous world. But now, everyone is looking at the impact of the US election. Are we headed into a period of instability, conflict, and the dismantling of both trade and defense alliances that have been built since World War II?
Perrin: The problems we face, from global poverty to pandemics to wars to global climate change, all require an effective, coordinated international response. Instead of that, we are witnessing countries turning inward on themselves, as well as the increasing ineffectiveness of global institutions like the UN, the World Trade Organization, and the WHO in actually resolving issues that go to our very survival.
When I was privileged to be in government, there was a sense that, when the leaders of the G7 – leaders who included Reagan, Thatcher, Mitterrand, Kohl, and Mulroney – came together, problems would be resolved. Today, when international meetings take place, you get the feeling that our problems are bigger than our leaders. In fairness, the world is a much more complex and dangerous place today, but that's precisely why we need leaders whose vision, determination, and morality are up to the challenge. As your question suggests, we're at a crossroads that will determine whether we will be able to maintain the institutions and strategies that have guaranteed democracy, peace, and prosperity since the Second World War. The stakes have never been higher.
AI is both a transformative opportunity and a destabilizing threat. What is your view of how will impact business?
Perrin: Like businesses the world over, Canadian businesses will be transformed either for the better or for the worse by AI. AI, like the nuclear genie, can't be put back into the bottle. Our challenge is first to understand it, then to decide how to mitigate its potential bad effects, and then to determine how to unleash its positive aspects. In this instance, the technology is developing at a pace that far outstrips our capacity to understand it and manage it well. However, calls to initiate some sort of a standstill until we have thought these things through are naïve and unworkable; all that would happen is that the unscrupulous players would widen their lead.
The challenge for Canadian policymakers is how to successfully work with others on coordinated policies that limit the dangerous aspects of AI without denying its benefits to our industry and our society.
If there is a second Trump Presidency, what should Canada expect from the 2026 review/renegotiation of USMCA trade deal?
Perrin: Many Canadians expected that when Joe Biden became president, he would reverse the Trump protectionist measures. However, that assumption overlooked the fact that, in the past, Republicans were more in favor of free trade, while Democrats were more protectionist. In fact, the Biden administration has actually deepened some of the protectionist policies initiated by Donald Trump.
The danger is that the election will be a contest between two candidates trying to demonstrate who is more protectionist. Canadians must respect the right of US voters to determine their own government, just as we would insist on the Americans respecting our rights, but we need to demonstrate that it is in Americans' self-interest to foster a stronger relationship with their closest neighbor and best friend. And we must do that, not by special pleading, but by coming up with solutions to problems.
Finally, what is the best-case scenario for the US-Canada relationship in terms of economic prosperity and security? Is there a way to slalom through the protectionism, AI disruptions, political polarization, climate challenges, and conflicts and see a time of increased joint prosperity?
Perrin: The best-case scenario is that we restore a strategic partnership with the world's greatest superpower. We've let the relationship slide for too long, and it won't be easy to regain that position. But I believe it can be done if we muster the vision and the will to make it happen.
Last thing: You worked for Brian Mulroney, who recently passed away. He was the architect of the North American Free Trade Agreement and worked closely with Ronald Reagan. What lesson can today’s leaders learn from that time?
Perrin: As Canadians commemorate Brian Mulroney, our leaders should ask what they can learn from Canada's last great transformative prime minister. Brian Mulroney understood that governments don't create jobs and prosperity, businesses do. He also knew that the best way to solve problems was not to shut people out but to bring them in.
It's impossible to say exactly what policies a different government would follow, but what we do know is that our economy and our country are under severe strain today. The leader history will remember best will be the one who brings people together again in what remains the most fortunate country on the face of the globe.
TikTok on the clock
In a rare bipartisan vote of 352-65, the US House of Representatives passed a bill on Wednesday that – if it survives the Senate — could force TikTok to divest from its Chinese parent company ByteDance or be banned on all US devices.
Many see TikTok as a threat to America’s national security since Chinese law requires private-sector companies to answer to the Chinese Communist Party. Lawmakers worry that Beijing could weaponize Americans’ user data (browsing history, location, contacts, etc.) and use the almighty algorithm to influence elections and further divide an already polarized country.
TikTok has found a surprising ally in 2024 hopeful Donald Trump. The former president pulled a 180 on supporting the ban, saying it will benefit American-owned Facebook — which he called a “true enemy of the people” (note, he doesn’t own that one). Trump’s change of heart came days after a meeting with GOP megadonor Jeff Yass, who owns a 15% stake in ByteDance.
What’s next: Although President Joe Biden signaled he would sign the bill, Senate Majority leader Chuck Schumer’s willingness to bring it to the Senate floor, and how everyone will vote, remains unclear.
What is clear: No one will come out of this fight unscathed. If TikTok gets banned, 170 million TikTok users (especially young people and Trump) will revolt. If everything stays the same, millions of Americans could remain vulnerable to foreign manipulation.Biden vs. Trump redux is official
They did it again. President Joe Biden and former President Donald Trump have mustered enough delegates in the primaries to secure their respective party nominations heading into this November’s presidential election — not that anyone expected otherwise.
For Biden, it was his win in Georgia last night that clinched it for the Democrats, while for Trump it was the GOP tally in Washington state. The rematch of 2020 comes despite both men’s unpopularity: Recent polling has Biden’s disapproval rating at 56.5%, while Trump’s unfavorable rating is nearly as high at 52.5%.
What’s next: The matchup that has looked inevitable for months is officially underway, but it’s unclear when, or whether, Biden will face off with his predecessor in debates. Trump has said, “I’m ready to go, ANY TIME, ANY PLACE!” Biden has appeared open to the idea, noting that it “depends on his behavior.”
In the meantime, expect plenty of campaign events and advertisements focused on both men’s ages, abortion, the economy, illegal immigration, and entitlements (more on that below).
Hard Numbers: Republicans regret Trump, Bosnia gets EU pathway, Pakistan swears in cabinet, Somalia’s pirates seize the moment
50 million:Donald Trump may have a chokehold on the Republican Party, but that doesn’t mean he has a grip on all Republicans. The group Republicans Voters Against Trump, which first appeared in 2020, has recently raised $50 million to produce a campaign of video testimonials by Republicans who voted for Trump in 2016 and 2020 but say they just can’t do it again this year.
30: Almost 30 years since the end of the Yugoslav civil wars, Bosnia and Herzegovina will be invited to begin EU accession talks, despite still-simmering ethnic tensions between Bosniaks and Serbs in the country. The talks are no guarantee of joining, which can take many years, but the perception of growing Russian influence in the Balkans has heightened Brussels’ interest in getting membership talks on track. Of the six former Yugoslav republics, only Slovenia and Croatia are in the EU.
19: Pakistan’s newly elected Prime Minister Shehbaz Sharif has a cabinet in place after its 19 members were sworn in earlier this week. They have their work cut out for them. Pakistan is mired in a severe economic crisis and must, almost immediately, negotiate a fresh $3 billion IMF loan package. Meanwhile, the streets are still hot with protesters supporting jailed opposition leader and former PM Imran Khan, whose alliance won the most votes in last month’s election but was shut out of government by Sharif’s coalition.
23: For the first time since December, Somali pirates successfully hijacked a vessel off the Horn of Africa, taking the 23 crew members of a Bangladeshi-flagged bulk carrier hostage. As Houthi attacks in the Red Sea draw much of the naval security attention in the region, the fearsome pirates of Somali are letting that Jolly Roger fly.Biden hits Trump on threats to cut entitlements
On Monday, a TV interviewer asked Donald Trump to detail his “outlook on how to handle entitlements: Social Security, Medicare and Medicaid?” His response: “There is a lot you can do in terms of entitlements — in terms of cutting — and in terms of also the theft and the bad management of entitlements.”
Within hours, strategists working on President Joe Biden’s reelection campaign issued a 20-second digital response for release on its X, Facebook, Instagram, and Threads social media accounts. It featured Trump’s words followed by a quick clip from Biden’s State of the Union Speech last week in which he pledged that “If anyone here tries to cut Social Security, Medicare or raise the retirement age, I will stop you.”
The Trump campaign quickly accused the Biden team of twisting Trump’s meaning. A spokesman insisted he meant cuts to “waste” in the programs, not to benefits.
Despite widespread concerns about the impact of long-term US debt, cuts to entitlement benefits or calls to raise the retirement age have long been taboo – nearly 80% said last year that they opposed reducing the size of Social Security – in American politics. We may find out this election year if that’s still true.
Trump has opened divisions within his own party on this issue in the past, and no matter what he says on it in the future, the Biden campaign will highlight his every word.Pressure builds on Ukraine
The most hotly debated question about a possible second Donald Trump foreign policy: Would he simply abandon Ukraine and its fight to repel Russian invaders? We might now have an answer.
Hungary’s PM Viktor Orbán, a political ally of both Trump and Russia’s Vladimir Putin, announced after meeting with Trump in Florida yesterday that the former president “will not give a penny in the Ukraine-Russia war.” He told Hungary’s M1 TV channel that “if the Americans don’t give money, the Europeans alone are unable to finance this war. And then the war is over.”
Trump himself has yet to comment on this claim that he would end the conflict by forcing a Ukrainian surrender.
Putin has also added more pressure on Ukraine. On Monday, he called it “quite understandable” that Pope Francis has reportedly urged Ukraine’s leaders to find “the courage of the white flag” to negotiate with the Kremlin.
Does Ukraine have any cause for near-term optimism? Despite delays, a few trained Ukrainian pilots will likely have six US-made F16 aircraft ready to go by this summer. Their successful use against Russian forces could accelerate the pace of training and delivery. (A total of 45 F16s have been promised.)
These aircraft won’t win the war for Ukraine, but significant numbers of them will boost Ukraine’s offensive and defensive capabilities. The timing of their delivery is critical. You can read details on their possible battlefield importance here.
Biden's vigorous SOTU speech aims to prove doubters wrong
Jon Lieber, head of Eurasia Group's coverage of political and policy developments in Washington, DC, shares his perspective on US politics.
What's going on with the Biden State of the Union?
So big week in US presidential politics. Super Tuesday basically effectively ended both primaries for the Republicans and the Democrats. We now have two all but official candidates. Joe Biden gave his fourth State of the Union address this week. Big question around Joe Biden, is he up to the task? 75% of Americans say that he is too old to run for a second term, but he is a attempting to prove them wrong like he did last night in Washington with a vigorous speech where he spoke for an hour, which officially kicked off his campaign.
Biden spoke about themes of income inequality, he spoke in favor of aid to Ukraine, and he rolled out a couple of tax increases that Republicans don't like. There's a lot of risk in every public appearance that Biden gives these days because of the fact that Democrats are very concerned that he's going to make a verbal flub or that he's going to look physically frail. That did not happen last night, and I think that's a good sign for Biden for now.
But every time he goes on stage for the rest of the year, there's going to be concern about how old he looks. So the campaign can now begin in earnest. Biden didn't mention Donald Trump by name in the speech, but he did indirectly attack him, talking about how Republicans are the party of the rich and how the threats to democracy represented by this election. At least that's how Joe Biden wants to frame it.