WSJ What’s News - U.S. Friends and Foes Brace for Second Trump Term

Episode Date: November 8, 2024

A.M. Edition for Nov. 8. President-elect Donald Trump taps his campaign co-chair as his chief of staff as a key pillar of his future foreign policy takes shape: a renewal of his ‘maximum pressure’ campaign against Iran. WSJ Brussels bureau chief Dan Michaels explains how Washington’s adversaries and allies are preparing for the new administration. Plus, Australia proposes a national ban on social media for children younger than 16. And Israel prepares to evacuate its citizens from the Netherlands after antisemitic attacks in Amsterdam. Luke Vargas hosts. Correction: Australia has proposed a ban on social media for children under 16. An earlier version of this podcast incorrectly said the ban would have applied to 16-year-olds as well. (Corrected on Nov. 8) Sign up for the WSJ’s free What’s News newsletter. Learn more about your ad choices. Visit megaphone.fm/adchoices

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brokerage services provided by FREC Securities LLC, member FINRA SIPC and advisory services provided by affiliate, Frac Advisors LLC, and SEC Registered Investment Advisor. The Trump transition gets to work as the president-elect taps a chief of staff. Plus, we look at Trump's early plans to dial up the pressure on Iran, as America's foes and friends brace

for change. China is quite nervous about a Trump presidency. Iran is probably quite concerned. And there's also concern that Trump would cut support for Ukraine or at least push European members of NATO to take more of the load from the U.S. And Israeli soccer fans are chased down and beaten in the streets of Amsterdam in attacks condemned as anti-Semitic.

It's Friday, November 8. I'm Luke Vargas for The Wall Street Journal. And here is the AM edition of What's News, the top headlines and business stories moving your world today. Donald Trump has tapped the co-chair of his presidential campaign, Suzy Wiles, to be his future White House Chief of Staff, making her the first woman to hold that role in U.S. history.

Trump's relationship with Wiles, who ran his campaign in Florida in 2016 and 2020 before taking on the national job this year, is one of his longest running with a top advisor. Trump has fallen out with many chiefs of staff, including John Kelly, and his previous campaigns were marked by staff shakeups at the top. Meanwhile, a key pillar of Trump's future foreign policy agenda is coming into focus. A renewal of the maximum pressure campaign against Iran that he pursued in his first term.

We report that the President-elect plans to drastically increase sanctions on Tehran and throttle its oil sales, including by going after foreign ports and traders who handle Iranian oil, with a goal of undercutting its ability to support its nuclear program and foreign proxy groups. Advocates say Trump's past approach to Iran succeeded in reducing the funds available to Iran's security services. However, it failed to halt Iran's operations via its proxies or its nuclear work. Trump's plans could also risk higher oil prices and sparking inflation, a similar dilemma

Biden faced in curbing oil sales by Iran and other adversaries like Venezuela. The World Will Look Like Under a Second Trump Term Well as Iran braces for Trump's inauguration, so too are foreign leaders and officials who are trying to figure out what the world will look like under a second Trump term. The Journal's Brussels Bureau Chief Dan Michaels has been casting his eye around the globe to try and answer that question. And he joins me now from Brussels.

Dan, Brussels hosts NATO. So I imagine one of the immediate questions is what will Trump's win mean for Ukraine and for Western support for the country? What are you hearing? A lot of nervousness is what I'm hearing and a lot of questions so far, not a lot of answers. Trump has been critical of the war in Ukraine, said it never should have happened, said it

never would have happened if he had been president and that he could resolve it within 24 hours. Folks at NATO are curious to see if that's possible, how he would do it. Not surprisingly, many are skeptical, but there's also concern that Trump would cut support for Ukraine or at least push European members of NATO to take more of the load from the US. Let's talk about the aid in a second, but just in terms of a prospect of a hasty peace deal to end the war in Ukraine, I guess the downside risk in Europe is it forces Ukraine to give up territory and thus

sets a precedent that's scary for many other countries. That is the concern in Europe and for many in the US that a hasty deal would have to be done on Russian President Vladimir Putin's terms. They probably would include surrendering territory that Russia currently holds, potentially saying that Ukraine can never join NATO, which is being held out as an option, potentially some other kind of disarmament for Ukraine. So none of that seems to look good for Ukraine and European members of NATO fear that if Putin is appeased and given what he wants, it won't sate his appetite, but in fact will

increase it further. If there is no immediate deal, Dan, then I guess there's the question of supporting Ukraine for a continued war and the prospect of reduced or even potentially cut off US support. That is something I imagine would send shutters through some European capitals thinking they might need to foot that bill. That's true. Europe has been supplying about the same value of support to Ukraine as the

US, though Europe, because it doesn't have the same arms industry as the US, has been supplying essentially cash to support the Ukrainian government, civil services, pay salaries, pensions. So if Europe now had to not only support all of that, but also pay for more weapons, potentially from other sources, that would be a strain on European budgets that I think many would find it hard to shoulder. Budget stand that might be squeezed because Trump in the past has taken a hard line on NATO contributions. This was him back in February when he suggested he wouldn't protect NATO allies who don't

pay enough into the alliance against a Russian attack. Let's say that happened. No, I would not protect you. In fact, I would encourage them to do whatever the hell they want. You gotta pay. You gotta pay your bills. Dan, I know since Trump's first presidency, many NATO countries have broadly increased their defense spending and yet from your reporting it sounds like there's urgency.

He could cause yet more frictions here. Very much. He has called European members of NATO freeloaders, said that they benefited from the US security umbrella and at the same time have been flooding the US with export goods. So there's going to be more pressure on European countries to increase spending. But this is a difficult political decision because the European economy overall is quite weak. So the governments just don't have the deep pockets to keep spending when there's political

pressure for more social spending. So it's sort of a guns or butter type of problem. As far as the Middle East, Dan, we reported today that Trump plans to take a hard line on Iran and of course Israeli Prime Minister Benjamin Netanyahu is celebrating Trump's victory. Trump has described himself as the most pro-Israel president ever and the two are known to be close. So let's turn our attention to China, our colleague Yaroslav Trofimov writing earlier this week that there are certainly some China hawks within Trump's orbit but he's also

noticeably not repeated Biden's pledge that the US would go to war over Taiwan and maybe he would be more amenable to the business lobby's desire for detente with Beijing. So lots potentially riding on what mix of those stances we actually get. Yeah, Biden's stance on that did cross a line that no US president had previously crossed. So this is one area where Trump may actually be more in line with the US tradition than Biden. But China is quite nervous about a Trump presidency

because he's pledged trade policies such as a 60% tariff across the board on Chinese products, which would kneecap the Chinese economy, force the Chinese government to help its companies look for other markets, Europe, other parts of Asia, probably big targets for that. So further ripples in trade and security. There are China hawks who may not want to go to war for Taiwan, but are still very opposed to what China is doing and who see part of the reason they are skeptical about Ukraine

and want Europe to step up there is that they want the U.S. to much more quickly prepare for a potential military conflict with China. Dan Michaels is The Wall Street Journal's Brussels Bureau Chief. Dan, thanks so much. Always good to be with you. Thanks. Coming up, Israel is sending rescue planes to the Netherlands after Israeli soccer fans are attacked in Amsterdam. We've got that story and much more after the break.

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fans were chased down and beaten following a game in Amsterdam last night. Israeli and Dutch leaders have called the violence, which appeared to leave several people injured anti-Semitic attacks, and Israel's National Security Council has urged Israelis in Amsterdam to stay off the streets, shelter in hotel rooms, and avoid showing Israeli or Jewish symbols. Dutch police say 62 people were arrested before and after last night's soccer match. The Australian government is proposing a national ban on social media for children under 16, a plan that was backed today by the leaders of all of the country's states and territories. The government has compared the proposal, which it's called a world first, with age

limit restrictions on the sale of alcohol, and Prime Minister Anthony Albanese described government intervention on the topic as necessary. Social media is doing social harm to our young Australians and I am calling time on it. The safety and mental health of our young people has to be a priority. Journal reporter Mike Cherney is in Sydney and explained what's setting the Australian proposal apart from how other jurisdictions, including some U.S. states, have approached their own regulation. The authorities have said they're not going to be fining teenagers or parents if somebody gets on the social media platforms who's not supposed to be on there.

They've put the onus on the social media platforms themselves. The government's going to be doing a trial, testing various technologies to try to make age verification more robust. That could include biometric stuff, AI, image reading, that kind of thing. So that's one interesting thing. Another one is there won't be a parental consent option. So some of the other jurisdictions allow certain kids to get on social media with parental consent, but that's not going to be an option here.

The Australian legislation is set to be introduced in parliament in the coming weeks and would take effect one year from passage. EV startup Rivian Automotive says it's on track to report its first-ever gross profit by the end of the year, despite a part shortage that forced it to cut its production goal. In a letter to shareholders, Rivian said higher selling prices and lower manufacturing costs helped it to offset a slowdown in vehicle deliveries. However, with Donald Trump moving back into the White House, Journal Auto's reporter Stephen Wilmot says that achieving profitability could be about to get even trickier for cash-burning EV makers. They're struggling to prove that they have a viable business model, even with quite generous

subsidies that were introduced by the Biden administration. It's been a lifeline for EV makers amid somewhat tepid demand for EVs. And Donald Trump has been very skeptical about EVs. So the question is, will he unwind a lot of the EV subsidies in the Inflation Reduction Act? And the other thing is that Elon Musk obviously was a big backer of Trump and a big donor and has been a big beneficiary through Tesla of tax credits. Investors might have been too quick to write off the Inflation Reduction Act.

Rivian shares dropped more than 8% on Wednesday after Trump was declared the winner of the presidential election, though they have since clawed back some losses. And in other news moving markets today, China's top legislative body has given its green light for local governments to replace some of their mounting off-the-books debts that have worried economists with special purpose bonds. But it is stopping short of new fiscal stimulus measures that many had hoped for. Japan's finance minister says the government is watching the currency market with what he called an extreme sense of urgency after the yen sank to a three-month low against the dollar in the wake of Trump's victory.

At a news conference today, he promised to take action against excessive price moves, stoking fears over potential yen buying intervention. And we are exclusively reporting that activist investor Carl Icahn sees opportunity in the stock market and will have his investment firm's dividend in order to fund his war chest. In a draft statement that he plans to release today, Icahn said he sees some companies as extremely undervalued, creating great opportunity for activist investors like him. According to the statement seen by the journal, Icahn Enterprises plans to propose boosting its controlling stake in Texas-based refiner CVR Energy, whose share price has dropped by more than 45% so far this year.

And before we go, we need to make a quick correction. Australia is proposing a ban on social media for children under 16 years old. On an earlier version of this podcast, I incorrectly said that the ban would have applied to 16-year-olds as well. And that's it for What's News for Friday morning. Today's show was produced by Daniel Bach and Kate Bulevent with supervising producer Christina Rocca. I'm Luke Vargas for the Wall Street Journal. We will be back tonight with a brand new show. Otherwise, have a great weekend and thanks for listening.