The Munk Debates Podcast - Munk Dialogue with Andrew Coyne: Trump doubles down on the Iran war and tariffs, and an AI model escapes the lab

Episode Date: July 24, 2026

Rudyard and Andrew begin by unpacking the latest escalation in the U.S.–Iran conflict. Andrew argues that Trump cannot simply walk away if he wants to prevent Iran from gaining leverage over the global economy—but where does escalation lead? Will striking power plants and bridges bring him any closer to his objectives? They then examine Trump's latest round of tariffs, including a new 50% tariff on Canadian goods announced this week. What does the global economy look like under the twin pressures of tariffs and war with Iran?In the second half of the show, Rudyard and Andrew turn to a startling development in artificial intelligence: reports that an OpenAI model circumvented its constraints and sabotaged another AI system during testing—without its engineers' knowledge. They argue that this is far more alarming than fears of job displacement, suggesting it reveals that AI companies may no longer fully understand or control their own creations. As AI capabilities accelerate at a breathtaking pace, they ask whether we're approaching a point where the consequences become impossible to predict—or contain.Become a Munk Donor ($50 annually) to get 72-hour advanced access to the full length editions of Friday Focus and Munk Dialogues. Go to www.munkdebates.com to sign up. Hosted on Acast. See acast.com/privacy for more information.

I mean, my God, think where the world economy and the American economy could be if we weren't running through the headwinds of ridiculous wars that drive up the price of oil or ridiculous tariffs that create uncertainty and drive investment this way and that and dampen economic activity. You know, we should be in the middle of a technology boom right now that it's going on simultaneously, but we're not reaping the fruits of it because we're, We're making economies go through these just driving headwinds of Trumpian nonsense. The Iran war looks set to escalate to new dangerous levels.

At the same moment that the Trump administration has levied new global tariffs, outraging allies and friends alike to break down a tumultuous week on many, many fronts. We're joined by our regular contributor here at Monk Dialogues. global male journalist Andrew Coyne. Hey, Andrew. Andrew, uh, let's start with the 64,000, maybe 64 billion dollar question now, given what this war is costing the United States. Why did Donald Trump go back to war? Why wasn't it in his interest, Andrew, to just walk away, to do what he usually does, which is, uh, claim victory, uh, snatch, uh, uh, victory from the Jaws a defeat in his view. Why is he back at war? Why is he bombing Iran for the 13th night in a row?

And why is he threatening a major escalation this weekend? Well, partly because Iran is making a monkey of him and he doesn't like to be defied. I think that would be part of it. But also because once he pushed Iran over the brink of action in the Strait of Hormuz, he in a sense liberated it. So previously Iran had not dared to take that obvious action that would increase its leverage on the Middle East and on the world for fear of military action against it. Once the military action had already happened, there was nothing to be lost by it. So they did the logical thing that everyone predicted. And once they've done that, then you can't just walk away. You walk away with Iran having the world economy

in a vice like grip, as they say. So he was caught on two fronts. He was caught economically, and that has political ramifications, obviously. And he was caught in the sense that he was being made to look weak and foolish. And nobody likes that, but particularly not Donald Trump, who is, after all, preeminently, weak and foolish. Andrew, to go back, though, to the framing that the president created around the MOU, he said he didn't want to end up as Herbert Hoover. He didn't want to be blamed with causing a worldwide depression. It's rhetoric, it's a hyperbole.

I think we all get that. Nonetheless, he's in summer driving season. Gas in the United States is heading towards that crucial $4 a gallon threshold seems to torpedo presidencies. Yet here he is not simply fighting the potential of a kind of limited engagement over the Straits of Hermose, but threatening a major escalation of the war. How does that all fit into his midterm plans to what this president, any president, frankly, is tracking, which is their immediate political prospects.

And what lies ahead in this case, you know, a potential hangman's news come November? Well, I guess where I would stop you there is any president. Trump is not like any president. And one of the things that comes out, for example, in that book, regime change by Maggie Haberman and Jonathan Swan is he doesn't, I don't want to say he doesn't care about the polls, but he certainly doesn't care about them in the way that most presidents do.

Now, sometimes we say we wish politicians weren't following the poll so closely. We wish they just did the right thing. In Trump's case, he's never going to do the right thing. He's always, always going to do the wrong thing as a point of principle. So you would hope, as a last resort, that the political insanity of what he does would come through to him. But it doesn't. And it must cause Republicans to tear their hair out. We've talked about this before.

For example, when Trump tells Republican voters that the elections are fixed, that is really not good for Republican fortunes. When he drives up the price of oil back over $100 through his ill-judged military actions, that is not good for anybody. but he doesn't appear to care, and you can draw whatever inferences from that that you like. It may simply be that he's just not focused on rational self-interest the way that other presidents, other politicians are, which is really disturbing because we know that he doesn't obey the law or custom or morals. But again, you'd hope as a backstop that maybe rational self-interest would kick in. But that's the real dilemma with Trump is you can't even count on that. He acts in ways that are utterly peculiar and utterly self-destructive.

And you just have to factor that into your equation as well. So, you know, it could just be that he's just not acting rationally. That is certainly a strong possibility, probability. And the other possibility, not necessarily exclusive of the first is, and again, we've talked about this, is the reason he's not driven by political calculations and polls, etc., is he doesn't intend to have free and fair elections. And that continues to be an escalating concern as we approach the midterm elections

of the various ways in which Trump could either try to rig the outcome or if he didn't like the outcome, ignore it wholly or in part. If we are not able to subscribe a motive here, for, as you say, for psychological reasons that are impossible to ponder or a 3D political calculus that's certainly beyond my cognitive capacity.

Are we not Andrew to at least be heartened by the result, which is that there was a risk based on the president's past behavior with Russia, China, Greenland, the list goes on, to simply have washed his hands of the Straits or Hermos and walked away. And instead, look, there's all kinds of bad consequences that could and probably are coming down the pipe, But at this point, at least it looks like the Iranian regime, a horrible regime, is now being challenged.

It is being contested in a way that the president wasn't willing to contest them for short weeks ago. Is that a, I don't want to call it a win, but is that a not unimportant dynamic here to acknowledge that Trump, despite all of his past behavior, which might have led to some, like handing the Straits of Hermos a vital international waterway over to Iran. We seem to be on the other side of a decision like that, which you would agree, it would have been disastrous. Well, it would be disastrous for Iran to be left with control of the Strait of Homoz. It would also be disastrous to escalate the war further. We're probably going to get both. In other words, there will be escalation that won't work.

that for the same reason that the initial war didn't work, that the Iranian regime is deeply embedded, has many different power centers, can't just be simply decapitated, has hidden away from what we read, it's nuclear material in a way that will make it even harder to get at than in the past, and as I mentioned earlier,

has sort of crossed the threshold of being willing to do things, things like the strata hormone. So it has nothing to lose. It has everything to fight for in terms of its own survival and really nothing to lose at this point. So that's a horrible position to be in. It's a very difficult one to get out of, as we've been saying, he can't, in a sense, can't just walk away. But escalation, I mean, where does that go? Right now, Trump's saying I'm going to bomb a bridge or a electrical plant, I don't know, maybe hospitals for every time that Iran attacks a ship in the Strait of Homo.

Okay, well, you're basically saying war crimes at that point. And when that doesn't work, where do you escalate to from there? Robert Pape, the University of Chicago professor, I think he's coined the term escalation trap, is predicting with some confidence that this is going to wind up with American troops going in, and that escalates things in terms of political risks, in terms of the peace of the region, piece in quotation marks. So escalation is not necessarily an either-or with Iran control of the Strait of Homoza.

It may just simply be quagmire type escalation. Do you see, Anders, some eerie parallels here between Vladimir Putin, who made a fatal miscalculation in his invasion of Ukraine, thought similar to the president, for different reasons and a completely different contact, that it would be a quick, sharp, fast war against Kiev. He's now a million casualties three plus years later. What's the risk of this war turning into something that may not match the Ukraine war, but might rhyme with it in terms of intensity, duration, global fallout?

It's starting to look like there's a number of parallels. There are definitely parallels, those parallels between the two men. I mean, Vladimir Putin is infinitely more cunning and sharper intellect than Trump, but he's also strategically stupid. He thought that, as you say, that Ukraine would either fall within three days or that large sections of the Ukrainian population would want to be part of Russia, that this was inevitable, that all it required was more. determination and more determination and more determination. And here we are with 1.3 million,

I think it is, killed and incapacitated. That is the scale of slaughter on your own side that we haven't seen, I think, since World War I, in terms of any European country. Or World War II, sorry, but the two world wars. So there's no chance of American public opinion being willing to put up with anything remotely close to that. I mean, the war is deeply unpopular now, and I think the Americans have lost, I think it's 18 soldiers, 18 versus 400,000, 500,000 killed on the Russian side in the Ukraine war.

So it's not like that in that case, and I don't think there's any chance of it becoming anything close to that, even under Trump. But the hubris, the strategic blindness, which comes from a dictatorial mindset, you know, whether an actual dictator like Trump or a halfway to dictator, a person like, like, actual dictator like Putin or a halfway to dictator person like Trump, they both have this idea of the world bends to my will. Events turn out the way I want them to turn out. I have only to say that something should be done and it shall be done.

and that's one of the advantages that full-blown democracies have is they've got a feedback loop where people can tell the leader this isn't working try something else. It's one of the strategic advantages of democracies in terms of mobilizing their populations as well. So the American population is anything but mobilized for this war. And that is a factor as well. even if Trump doesn't care, ultimately that will make itself felt in one way or another. As we wrap up this, the free complimentary half of today's monk dialogue. If you're not a monk member, go check out our website because you can join Andrew and me for the

back half of these programs, also my shows with Janus Gross Stein and so much other premium content exclusive to monk donors, triplew.munk debates.com. Andrew, if we weren't glutton's for punishment enough, soaring gas prices, a blossoming, bludgeoning war in the Middle East, we now have the announcement in the last 24 hours of a new slate of tariffs that are being literally put into effect under 1930s Depression-era tariff law that, creates a kind of straw man of supposedly an epidemic of child labor amongst the developed economies of the world that the United States must address by levying 10 to 12 to 15% tariffs on allies. Some of those tariffs blunted by existing agreements like Kuzma. but nonetheless, an attempt very clearly, Andrew, to kind of reverse the impact of the Supreme Court's decision earlier this year to repeal the emergency tariffs. What's your take?

Well, we'll see what the Supreme Court makes of these as well. I mean, this is on top of the 50% tariff put on Canada under, again, an obscure provision of the 1930 Tariff Act, a smooth-holly act. which is there's a lot of argument is essentially a dead letter and it may well be found to be so by one court or another so the legal you mean this is the trump modus operandi right is i'll see you in court i'll see you in court again i'll see you in court a third time um this is you know going back to his days as a developer where he would just stiff as suppliers and you just tie them up in court and if you've got more money and more patience and more nerve and more shamelessness,

then you can keep doing that. And again, presidents who keep losing in courts on major policy departures usually pay a price for it and usually care whether they're paying a price for it. In Trump's case, I'll give him this. It's often said he doesn't believe in anything. He believes in tariffs to the depths of his soul.

I think it's one of the few things he really and truly does believe in. he imbibed this idea somewhere along the line that the great days of America were when it had high tariff walls in the 19th and early 20th centuries and we really need to go back there. And the make America great again is ultimately rooted in that. So it's going to be very hard to move them off it. And so even when one tariff is invalidated by the courts or when the Congress eventually, gets around to saying, wait a minute, we really want to rethink this whole business of delegating

tariff authority to a president because we'd no idea it was ever going to be abused quite so routinely as it is under this president. I mean, the power to raise and levied tariffs is their taxes. That is the power that resides in the Congress preeminently. And yes, they've passed laws over the years giving the, giving presidents emergency powers in one place or another to impose them unilaterally without having to go through the Congress, but they never in visits, I'm sure, anything like this. So this is one of those things that in the long term, the United States will have to repair.

The damage that will have been done on this one area of the separation of powers is profound, and it's had huge consequences. I mean, my God, think where the world economy, the American economy could be if we weren't running through the headwinds of ridiculous wars that drive up the price of oil or ridiculous tariffs that create uncertainty and drive investment this way and that and dampen economic activity, you know, we should be in the middle of a technology boom right now

that it's going on simultaneously, but we're not reaping the fruits of it because we're making economies go through these just driving headwinds of Trumpian nonsense. Andrew, final question. When we think of these tariffs, you're right. They've kind of jelled to this president. They've seen part of his persona. As you said, maybe it's one of the things that he truly does deeply believe in. But I guess my concern is that there also seems to be a fiscal rationale for these tariffs.

The United States is running deficits at 5 to 6% of GDP, something that you would normally see at a time of national crisis or deep, deep, deep recession, both, well, maybe the national crisis is there, but deep recession so far isn't. Is it any coincidence that these new tariffs are replicating this, the previous sets of tariffs that seem to, up until their cancellation, seem to have brought in hundreds of billions of dollars into the U.S. Treasury, and that in no small way, that money was part of the, part of the fiscal balancing act of the one beautiful bill act that allowed for massive tax cuts to high high income, ultra high income earners, corporations and others. It's part of the big boom in asset inflation right now in the United States on top of large-scale deficit spending.

So I don't know, Andrew. I'm just wondering how much of this, how much is Trump the prime mover here? and how much is a growing realization, maybe bipartisan in nature, that America has a deep fiscal crisis. It needs to figure a way out of it. And in a kind of ingenious way, Andrew, tariffs might be the one tax that Americans politically are willing to pay. Oh, I don't know about that. I think there's plenty of evidence that the tariffs are very unpopular,

that people rightly recognize them as taxes on themselves. They're not fooled by this idea that they're somehow levied on other countries. I agree they need the revenues, but they're not going to raise anything like the amount that they need to even put a dent in their deficits and debts with the tariff revenue. And whatever revenue might have raised in the short term, it's going to be a declining amount. I mean, people will pay the tariff in the short term because they're waiting to see what happens. but over the longer term, people will make adjustments. And the point of a tariff is to stop trade. And if you stop the trade, you don't get the tariff revenue.

So it's not an answer to their fiscal woes, which are, as you say, immense. They're running deficits of, I believe, 6% of GDP. Their debt to GDP ratio is, I believe, over 100%. And that's just the on-book debts. The Social Security Fund, which in Canada, you know, it is, mostly funded. It's not fully funded, but it's mostly funded, and it's certainly in a stable state in the long run, our Canada pension plan and Quebec pension plan. The Social Security Fund last I looked was set to quote unquote run out in five or six years. So they've got a whole

question there about how do they make a sustainable pension system for their retirees on top of the budget debt that they're running? And where they've got a president who's driving their economy into the ground, these are not good combinations. And then you see him, you know, trying to politicize the Fed so far without success. It looks like the guy he's put in, maybe we'll see, maybe another in a long line of Trumpian appointees who, who, once they got in, refused to do what the president ordered them to do. But don't be, don't be sure of that. But certainly, if Trump had as druthers, you'd have a federal. reserve that was basically monetizing these debts and you'd get higher inflation, higher inflation

expectations, higher interest rates and ultimately higher debts out of that. It's a fool's game. You can't actually inflate your way out of these things. But that doesn't mean Trump wouldn't try. So all of these things are an absolute witch's brew of just terrible economic policy that again is going to have consequences for years, if not decades to come. Yeah. Well said, Andrew. Let's say goodbye to our complimentary listeners of viewers are going to join Monk donors for a bonus portion of today's conversation with Goldmail Journalists, Andrew Coy. We're going to talk about AI getting out of the box, a worrying development with a cutting edge open AI model that hacked its way out of confinement and hacked its way into another company. Is this the future of the genie in the bottle getting out? may be faster than we think. We'll bring you that conversation exclusively for monk donors after

the short break. Thank you for listening to the first half of our monk dialogue with Andrew Coyne. To get access to the full episode right now, consider becoming a monk donor. For just $50 a year, less than a dollar a week, you will get 72-hour advanced access to all of our premium podcasts, including Friday Focus with Janice Gross Stein. You also get our live streams of mainstream. stage debates and all kinds of other great perks and privileges. Simply go to our website, triplew.munkdebates.com. That's MUNK DebateswithanS.com. And click on the join button on the top right hand corner of the screen. Again, that website, triplew.munkdebates.com. The monk debates are a project of the Aurea and Peter and Melanie Monk Charitable

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