WRESTLING WITH FOREIGN POLICY

Last month, your Friday author heard an excellent speech from Gillian Tett of the Financial Times in which she recounted, among other things, observations from Naomi Klein's book No is Not Enough on President Trump's personal history with American professional wrestling and its impact on his political style. Tett wrote on the subject here.


If you've seen an American wrestling match, you'll recognize the atmosphere at many Trump rallies: the pumped-up, angry crowds, the chanting, and the emasculating nicknames wrestlers use to belittle one another. It's a chaotic (carefully choreographed) spectacle.

As Klein points out, it's also an audience and a ritual that liberals and the wealthy in the US tend to ignore. That makes it harder for them to recognize the fears and needs of many people who feel completely overlooked in American society. President Trump understands this.

But professional wrestling also presents a "morality play." When warriors enter the ring, every spectator knows which one is the hero and which is the villain. There can be no heroes without villains. It's the villain that defines the hero.

Trump is hardly unique in his search for useful foils. This is an element not only of the political arena but of human nature. But given his business and personal ties with professional wrestling and its most successful promoters, its influence is revealing for understanding his foreign policy—and the adversaries he's most likely to cast as villains over the coming (very challenging) two years.

Which baddies does the Trump crowd boo with greatest gusto?

China: There are good reasons why the US—and other governments—demand changes to Beijing's economic, trade, and investment policies. But China is especially well cast as a bad guy for Trump's audience because many of his most loyal supporters see that country as the threatening power on the rise, one that has "stolen" large numbers of US manufacturing jobs.

Mexico: Last month, Trump told Plitico: "I will tell you, politically speaking, that issue [of halting immigration across the US-Mexican border] is a total winner." The president's midterm election strategy made clear that, whether Trump's supporters see would-be border-crossers as jobseekers or gang-bangers, they want to keep them out of the US. Andres Manuel Lopez Obrador, Mexico's leftist new president, has promised to help Central Americans escape hardship. For now, Trump and Lopez Obrador have a few things in common, but that relationship looks likely to head south.

Iran: Many of Trump's voters are older—in fact, old enough to remember the national humiliation many felt when Iranian revolutionaries held 52 Americans hostage inside the US embassy in Tehran for 444 days from November 1979 to January 1981. But Trump supporters also tend to prioritize support for Israel's security. Iranians, more than their Arab neighbors, are apt to publicly threaten Israel.

These aren't the only villains Trump supporters want to see him throw from the ring, but they're the most reliable of his political bad guys—and there are more than enough areas of real disagreement with these governments to fuel many a fight in months to come.

Facebook unveiled plans for a new cryptocurrency and payment system on Tuesday. It's called the Libra, and it's not-so-modest goal is to "reinvent money," and "transform the global economy" so that "people everywhere can live better lives." Ambitious much, Zuck?

This is a huge political gamble, but the rewards could be enormous. Here's a quick look at the tradeoffs:

The risks: Facebook is asking its 2.5 billion users — and government regulators — to entrust it with something that's vitally important to people everywhere and a power that governments jealously protect: access to money. And it's doing so at a time when trust in Facebook and other big Silicon Valley companies is at a low ebb.

Whether it's a concern that Big Tech has become too powerful or that it's not doing enough to protect privacy or put a stop to fake news, it's a heck of a time to launch a new techno-utopian project that could give Silicon Valley much more power — including the ability to track not just what people say they like but how they spend their money.

Mark Zuckerberg understands this — the Facebook founder is setting up Libra as a Swiss-based non-profit that will be governed by an "association" of 28 tech and financial companies and non-profits of which Facebook is just one member. He's also promising that Facebook will not mix personal data with payment information, and to cooperate with regulators.

But this will always be Zuckerberg's baby, and by launching Libra, he's painting a big new political bullseye on his own back.

The payoff: If Libra can survive the inevitable political and regulatory storm (and convince its billions of users that they can trust the underlying technology and financial stability of the new cryptocurrency) the upside could be enormous.

How enormous? The Libra website claims that more than 30 percent of the world's population — about 1.7 billion people — currently lack access to traditional bank accounts. Many more pay steep fees to transfer money using traditional payment services. Libra, by contrast, promises access to anyone in the world with a simple smartphone — and to make payments as inexpensive as sending a text message.

Plug those capabilities into a social network whose user base is roughly double the population of the biggest country in the world, and the results could be revolutionary — not just for billions of people who would gain new access to financial resources, but for Facebook's business model, and for central banks and governments that have traditionally sought to control the flow of money through their economies.

That would be a techno-utopian dream come true, but it's a power that governments won't willingly surrender.

If Willis's story on Tuesday about Argentina being plunged into darkness after a nationwide power failure didn't get you packing a flashlight and checking that your car has a full tank of gas, this one should. Over the weekend, the New York Times said anonymous US officials had revealed a US campaign to plant "potentially crippling malware" inside Russia's power grid "at a depth and with an aggressiveness that had never been tried before."

Quick thoughts:

This is a big provocation. It's the cyber equivalent of mining a harbor — an aggressive move that falls short of actual conflict but sends an unmistakable message: mess with us, and we'll mess you up.

The leak was probably intentional. The campaign fits with the new US strategy, launched under the Trump administration, of trying to deter cyber adversaries like Russia, China, and Iran from hacking its critical infrastructure. By disclosing the US campaign, US officials are effectively telling Russia (and by extension China and Iran), that they've got a loaded gun cocked and pointed at their economies.

That's dangerous. People — and governments — may not always behave rationally when a gun is pointed at their heads. Russia might be even more inclined to lash out. And unlike more conventional forms of conflict, cyber isn't a domain where the US can be sure it has an overwhelming advantage if push comes to shove.

It gets worse. The Times said US cyber officials described a "broad hesitation" to go into details of cyber operations against Russia with President Donald Trump because they feared he might cancel it or tell other governments about it. Among other things that are disturbing about this story, a lack of communication between the President and US cyber warriors could send mixed signals that further embolden US adversaries.

It's no secret that cyberattacks are becoming more commonplace. But where do most of them originate and what countries do they target most? The graphic above shows the most significant offenders and victims since 2006. Hackers in China, Russia, Iran, and North Korea account for three-quarters of all major attacks. Nearly a fifth of attacks, meanwhile, have targeted institutions or companies in the United States.

(At least that we know of: this chart highlights known attacks on government agencies, tech companies, and other operations that caused more than $1 million in economic damage. But many cyberattacks are never disclosed, and some countries are more transparent than others, so consider this a cross-section of a much bigger — and more disturbing — picture.)

China's outrage against Swiss bankers – Paul Donovan, an economist at UBS and a former colleague of your Wednesday Signal author, ended up in hot water last week after he wrote that an outbreak of swine fever that had pushed up pork prices in China, "matters if you are a Chinese pig. It matters if you like eating pork in China. It does not really matter to the rest of the world." The Swiss bank put Donovan on leave after a nationalist tabloid picked up the story, unleashing a torrent of invective from angry Chinese citizens, industry groups, and clients. Although we're a bit puzzled at the intensity of the outrage, we're following this story closely. The anger of 1.4 billion people is a powerful thing, and if the US-China standoff over tech and trade continues to escalate, US firms could soon find themselves on the receiving end.

What we are ignoring: Trump on ICE

Trump's Deportation Threats – As Donald Trump revved up his official reelection campaign in Florida on Tuesday, he took to Twitter to vow mass deportations of "millions of illegal aliens" starting next week. We are ignoring this for two reasons: First, it looks more like a campaign trail stunt than a well-thought-out plan — the scale of deportations Trump envisions would require massive logistical coordination, and it's not clear that Immigration and Customs Enforcement (ICE) can deliver it — even if the federal force got help from local police, who may be reluctant to participate in mass arrests in their communities. Second, while this type of rhetoric may play directly to Trump's base, images of crying children torn from their parents will galvanize the president's opponents — and, in particular, the suburban women crucial to his 2016 victory. We're not ignoring the pain and trauma that mass deportations would inflict on immigrant communities if Trump delivers on this threat. We're ignoring a boast that's likely to prove a political bust.