Trump 2.0 and Cold War 3.0 *

Abstract

What are the likely implications of Donald Trump's second term in office? Many of the foundational policies from Trump's first term - such as tax reductions, deregulation, demands that allies increase their military budgets, and increased tariffs on foreign products - are likely to persist, alongside the establishment of a new Department of Government Efficiency to reduce government staffing and expenditures. Trump will confront a divided Congress, a polarized public, potential divisions within his administration, and the emergence of the Global South, with its grievances against the developed North. In addition, the geopolitical landscape is characterized by increased competition and conflict, reflecting the tensions and uncertainties produced by the imbalanced interdependence of global economies and the rise of new international coalitions with different goals and values, raising concerns about Trump 's capacity to effectively navigate these multifaceted challenges.

Headnote

What are the likely implications of Donald Trump's second term in office? Many of the foundational policies from Trump's first term - such as tax reductions, deregulation, demands that allies increase their military budgets, and increased tariffs on foreign products - are likely to persist, alongside the establishment of a new Department of Government Efficiency to reduce government staffing and expenditures. Trump will confront a divided Congress, a polarized public, potential divisions within his administration, and the emergence of the Global South, with its grievances against the developed North. In addition, the geopolitical landscape is characterized by increased competition and conflict, reflecting the tensions and uncertainties produced by the imbalanced interdependence of global economies and the rise of new international coalitions with different goals and values, raising concerns about Trump 's capacity to effectively navigate these multifaceted challenges.

Keywords: Trump 2.0; Cold War 3.0; populism; nationalism; geopolitics; Global South; Global North

These days, I live mainly in Taiwan, where I hold two full-time jobs: a faculty appointment here at NCCU, and my membership on the board of directors of the Center for Asia-Pacific Resilience and Innovation (CAPRI), Taiwan's first non-governmental, non-partisan comparative public policy think tank. That means I spend far less time in the United States than I do here, so I have less first-hand information about the political conditions there, and less confidence about my ability to forecast what will happen as Donald Trump returns to office and launches his second term as president, especially as he confronts an increasingly complex international environment, which I call Cold War 3.0.

What are likely to be the similarities and differences between Trump's first term in office and his second administration? Will there actually be a Trump 2.0 or will there actually be a surprising degree of continuity with Trump 1.0, or even with Biden 1.0?! think both change and continuity are possibilities, especially in domestic policy. There may also be both similarities and differences in the American policy toward China.

In all these areas, the challenge to prediction is dealing with a great degree of complexity, not only in the United States, with its great high level of polarization, division, disunity, and uncertainty, but also in the world as a whole. That's why I will conclude this presentation by discussing Cold War 3.0, which has emerged largely due to the breakdown of U.S.-China and U.S.-Russia relations and the deterioration or even collapse of some major international norms and institutions that formed an important part of the liberal international order that is rapidly under threat.

This high level of complexity makes prediction extremely difficult. Complex systems are hard to predict - far harder than more coherent, stable systems. That's why I'm not going to make any firm predictions today - I don't think that's possible for the highly complex systems in which we live. Instead, I will talk about possibilities - what might happen - rather than trying to forecast what will happen.

I will begin by giving some examples of how complexity makes prediction difficult and how complex systems are vulnerable to surprise. How many people predicted President Joe Biden would have such cognitive problems - likely the early stages of dementia - that he would be forced to back out of his election campaign shortly before the nominating convention?

Who would have thought the only plausible candidate to succeed him for the nomination would be Kamala Harris, who, although serving as his vice president, had little experience in managing the national government? Who would have predicted that Donald Trump, given his continuously falling approval ratings since he entered the presidency and continuing through his term in office, would be able to defeat Kamala Harris for the presidency in 2024? Who would have predicted that the Republican Party would gain control of both the House and the Senate, given its low approval ratings? Similarly, who would have predicted that the French prime minister would be forced to resign because of his inability to get major legislation through, suffering a vote of no confidence by his own party? And who would have predicted that the president of South Korea would make one of the most foolish decisions recently by a political leader anywhere - imposing martial law because he was worried about his standing in his own political system, only to suffer such a collapse of public support that he would retract that declaration of martial law in a matter of hours, not even days?

Who would have predicted any of these things? That's what complexity does. It produces unexpected and often unpleasant surprises. So, although complex situations are hard to understand and nearly impossible to predict, we can still look at some straws in the wind for clues. We can find some early indicators and see some bigger changes that are occurring as well.

I will first talk about these possibilities - not predictions, but possibilities - of Trump 2.0 before I turn to the second question of how the world is changing and producing what I call Cold War 3.0. In trying to identify those possibilities in a second Trump administration, I'll also be asking some specific questions. The first of these is: Has Donald Trump changed at all? Is he a different man than when he was first in office? I'll explain why some people ask that question and why it is not an unrealistic question to raise. I will then talk about some of the early trends we see in his administration that suggest things to watch for. Then, in the last section of my talk, I will turn to the way the wider world is changing, and how it is leading to what I call Cold War 3.0.

With that as introduction, I will now ask the first question: Has Trump changed? And why would I raise that question, and how do I think it is possible to begin to answer it?

It already seems like a long time ago, but you may remember that former President Trump experienced two assassination attempts before his recent election, both of which failed. The first and most serious attempt was the one at a campaign rally in Pennsylvania, where shots were actually fired, one rally-goer was killed, and one bullet hit Trump's earlobe causing a great deal of bleeding. When someone faces those kinds of threats to his life, it's not unreasonable to ask if they changed him. Trump himself, along with some of the people around him, declared that it did, that he became a different person, and that he faced death and came away a changed man. They said he was going to be much more gentle, much more relaxed, and much more thoughtful about the important things in his life, rather than acting as spontaneously and carelessly he had before.

It's conceivable. But I doubt it.

As evidence, I recommend a podcast by Joe Rogan, a very popular conservative commentator in the United States. Listen to the fairly recent podcast that featured an interview with Trump. If you do you will see that not much has changed at all - that his personality remains very similar to what it was in Trump 1.0.

The interview shows that Trump is still quite a vindictive person. He has a list of enemies, rivals, and people he can no longer trust, dating back to his first term in office. In addition, he is still fixed at on certain policy preferences, including lowering taxes - especially for businesses and the wealthy - deregulating the economy, demanding American allies to pay more for defense, and using tariffs, and stop them from, as he said about China, "raping the United States." All of these are policies that are holdovers from his first term, and as the Rogan interview suggests, he remains committed to them. He has no doubts about the utility of tariffs to achieve these goals and still believes that tariffs are easy to impose and trade wars are easy to fight and win.

So, I don't think Trump has changed as a man, and I don't think many of his policy preferences have changed either, except for a new desire to cut the size and cost of the U.S. government and the size and cost of the career bureaucracy. That initiative is reflected in the creation of the Department of Government Efficiency, or DOGE.

What's puzzling about the name is that it's not actually a department of anything because it has no formal status in the U.S. system. It is not a cabinet department but instead an advisory commission, headed by one of Trump's closest personal friends - Elon Musk, a who shares Trump's nviction that the American government has gotten too big and needs to be cut back. They argue this is necessary both to make the government more efficient and to save money so that the tax cuts Trump wants can be realistically implemented.

Otherwise, Trump is likely to continue the policies associated with Trump 1.0. He still wants to reduce American defense commitments and to avoid or reduce the cost and risk of involvement in foreign wars. This is most evident in America's fading support for Ukraine in its war with Russia. A high priority in his new administration will be forcing some kind of armistice or peace settlement. He may apply the same calculations to Taiwan.

Closer to home, he continues to insist that foreign partners, including Taiwan, pay a higher price in terms of their own defense expenditures and military preparations rather than depend so heavily on American support and potential military involvement in a crisis. Some even suggest that this is aimed not simply at reducing the risk and cost of war to the United States, but also at achieving a reputation as a peacemaker - perhaps even winning the Nobel Peace Prize for his efforts. That, of course, would be a way of belittling the importance of Barack Obama's Nobel Peace Prize. Trump would then say, "I didn't just give a speech - I actually ended a war."

So the continuities between Trump 1.0 and Trump 2.0 are evident both in his personality and in the policies he is pursuing.

But what about the other aspects of this incoming administration? What do we know, and what can we consider, as possibilities rather than firm predictions, about his personnel appointments?

Some of his nominees have encountered serious objecions, forcing them to withdraw their names from consideration due to the possibility of being rejected by Senate confirmation. It's relatively rare for a president's nominees to be defeated in the Senate, especially if they have the endorsement of the senators from their states of residence. But while this is not unprecedented, it is unusual.

It also suggests some interesting facts about the extent of Trump's victory in this presidential election. Of course, he won his first election because of the Electoral College, and he did not get a substantial popular vote. That's why he attempted to challenge the outcome when it came up for approval in the House of Representatives.

This time, however, Trump is more satisfied - there is no need to challenge the election outcome. There is general agreement that he won, but he didn't win by much. He actually got less than 50% of the votes - 49.8% (while Harris got 48.3%). It was a weak victory, but a decisive one in that he managed to win every one of the swing states that were heavily contested and that was the key to his victory, since it provided a clear victory in the Electoral College. Still, while a victory, it was not a landslide. There have been landslides in presidential elections before, but this was not one of them.

Trump won - nobody doubts that - but we are already seeing signs that he does not have the overwhelming mandate he had hoped for and that he claims he received. Therefore, he will face challenges. His administration will face opposition, both in the Senate and the House, and possibly even through other forms of protest, potentially even in the streets. The political context will remain uncertain.

Let me now turn to another aspect of Trump 2.0: the composition of the incoming Trump administration. Here, we do see some important changes, and these reflect - especially according to the Joe Rogan interview with Trump - the lessons that he learned from his first term in office. You see no former generals in this new administration. These were people that Trump was confident would be loyal and effective administrators because of their military background. He admires the military - he went to military school, you may recall, when he was a teenager - largely because his father felt that he needed more discipline. It's not surprising that Trump would have turned to retired generals in his first term.

By his own account, he was deeply disappointed by all of them - by the fact that they actually had no experience in Washington politics. Also, they proved to be disloyal in his eyes, and even worse than that, not only did they criticize him and try to block him from doing things when they were on his staff, but once he fired them and they left office, they wrote memoirs and books that were very disrespectful of him. So, Trump wants to ensure that this situation is never going to happen again.

So, who is he appointing in place of the generals? He's largely appointing - and Musk is an example - billionaires and others from the business community. But they also may not have much experience in government, so they may not be able to provide the results that Trump expects them to achieve. That is going to be a major problem for analysts to watch.

In addition, Trump may fall victim to the same problem that Harry Truman identified when he was being succeeded by Dwight Eisenhower. Truman told an interviewer, sitting in the Oval Office, that Ike would be sitting in the Presidential chair and saying, "Do this, do that!" - but nothing would happen. "Poor Ike," Truman said, "he will find that it's not like the Army at all. He will be very frustrated." And that was the conclusion of the interviewer's book - a very important analysis of the presidency: that the power of the presidency is not to give orders but the power to persuade.

And it seems that Trump is not that good at persuading. He likes to overwhelm with emotional arguments, or to make transactional deals, and he may try to rely on giving executive orders to the bureaucracy, and he may find that difficult as well.

We've already seen the breakdown of party discipline in the Senate. Senators are making it very clear that they're not just going to confirm Trump's nominees automatically. If there are problems, they are going to challenge, they are going to question, and they may very well succeed.

One of the best analyses I've heard on this problem foresees what may happen to the new Department of Government Efficiency. One friend who recently visited Taipei from Washington said that when you're outside of government, you may be critical of the bureaucracy and of waste and inefficiency in government. But once you become a cabinet secretary, your viewpoint changes very quickly. Instead of seeing wasteful expenditure in government budgets, you see necessary and useful expenditures in the agency you head. What you once saw as inefficient career bureaucrats, become your appointees and your people. You are coopted by the system in which you operate.

Therefore, the attempts by Elon Musk and his team to make the government more efficient will produce a battle royal within the Trump administration. So, Trump will face resistance from the Congress, where his party has a very weak majority, resistance from his cabinet members, as they are told they will have to cut back staff in their own agencies, and resistance from members of the public, who are served by those agencies.

The final topic I want to address today is what I am calling Cold War 3.0.

With the escalation of tensions between the United States on the one hand and both China and Russia on the other, there has been much debate about whether the United States is engaged in another Cold War: Cold War 2.0. The hope had been that with the first Cold War ending, initially with the effort at "Perestroika" and "Glasnost" by some of the leaders of the former Soviet Union, especially Gorbachev, then with the collapse of the Soviet Union itself, there would be no more Cold Wars in the future, and no certainly more hot wars in Europe. Security cooperation in most parts of the world, especially in Europe, would be promoted by the process of European integration and overseen by an increasingly powerful European Union. The "Washington Consensus" would govern development policy nearly everywhere. The United States would enjoy a peace dividend - it would be able to cut its expenditures on the military after Cold War 1.0, just as it had after World War II. But these expectations were disappointingly short-lived.

While some believed that history had ended because of the collapse of the ideological rivalry between the United States and the Soviet Union - and that war was now unlikely due to unity in Europe, growing mutually beneficial interdependence, and the growing costs of war - we now see, unfortunately, the emergence of a competitive and possibly conflictual relationship between the United States on the one hand and China and Russia on the other.

This Cold War 3.0 involves many of the characteristics of the first Cold War: growing competition over military power; increasing economic competition - even far more than in the first Cold War; and an emerging ideological competition between authoritarian and democratic forms of government, especially now between China and the United States.

While some call this the second Cold War, many analysts have pointed to the differences between the two. The most important one is that we are now in a period of shared mutual destruction. All three major powers in the international system - China, Russia, and the United States - have nuclear weapons, meaning they are all capable of imposing assured destruction on one another if war breaks out. That is supposedly a way of keeping conventional wars from breaking out, but already, we see that has not stopped wars in Ukraine or the risk of war in Korea or the Taiwan Strait.

The United States and Europe have not been directly involved, so military confrontation occurs through proxies, through weaker allies.

The other major difference, with Cold War 1.0, which is more important and more frequently noted, is the fact that the major powers, first the Americans and the Chinese, and then the Russians, will become deeply interdependent, far more than the participants in the first Cold War were. Therefore, some optimistic analysts have said that this new international system will be one in which interdependence will support a peaceful and cooperative relationship among the major powers, rather than a second Cold War.

That assumption - that interdependence produces peace - has a very, very long history. It goes back to a book called The Great Illusion, about the unlikelihood of a war in a highly interdependent Europe, written by Norman Angell, who won the Nobel Peace Prize for writing it. Unfortunately for Mr. Angell, his book was published in 1910, and World War I broke out just four years later. So, this assumption, held by many liberal scholars in international affairs, has often been proven to be incorrect - and maybe proven to be incorrect again.

This is therefore a very different international environment than the first Cold War. Yes, China and the United States are far more interdependent now than they were then, but that has not been a guarantee of peace and cooperation given their differences on geostrategic issues. That's why some people, including myself, have used the phrase Cold War 2.0, to make the argument that, yes, the current global situation is different, but it still is very similar in some important respects to the first Cold War.

So why do I now call it Cold War 3.0? That is because the international environment has changed yet again. The first Cold War was not simply the rivalry between the United States and the Soviet Union but was a bipolar rivalry between the United States, the Soviet Union, and China, along with the alliances and political groupings that these two powers had created. What we're seeing today originally looked like a different form of bilateral grouping, centered on the United States and China. But now we are seeing more groupings being forged, the most important of which is what many people call the Global South.

The Global South is a set mainly of recently independent countries - some of which became independent from the Soviet Union, of which Ukraine is a good example. Some gained independence from former Western imperial powers; these include much of Africa, much of South Asia, and parts of Southeast Asia. Many of these countries feel that they are not achieving the rapid economic growth or reaching middleincome or upper-middle-income status as they had expected. Many of them are caught in the middle-income trap: they reach a certain level and don't progress further, and they're asking why.

In particular, those that are former colonies are pointing to the cost of having been part of an exploitative imperial system. Even the earliest independent states are still burdened by the legacies of political institutions and economic models left behind by the Western imperial systems to which they belonged.

So, the politics of the Global South in this new Cold War 3.0 are the politics of grievance. Some in the Global South want reparations from the Global North, while others want compensation, and others simply want more supportive development policies. They're opposing the return of mercantilism in many advanced economies as growth slows down. They are angered by the movement of the North, including the United States, away from open-border trade, free trade, and markets to more regulated and restricted trade.

They are also irritated at the United States for backing away, for various reasons, from the kinds of economic aid that they thought were coming and that they believed they needed - mainly in the areas of hard infrastructure, whether it be building ing airports, steel mills, or most notably these days, transportation networks. When the U.S. backed away, the Chinese moved in, sometimes on what the recipient country sees as unequal or even exploitative terms, and so the Global South increasingly feels betrayed by both history and the present policies of the Global

North. One important aspect of this tension between the Global North and the Global South is the competition over leadership of the Global South. China likes to make a claim to leadership, insisting that it was never an imperial power and that it remains a developing country. But some in Taiwan and in Vietnam argue that they were under imperial Chinese rule, for 1,000 years in the case of Vietnam and several decades in the case of Taiwan under the Qing dynasty. Today, many more people ask if China is the biggest investor and the biggest lender to emerging markets, and if its Belt and Road initiative seeks control over transportation networks and raw materials just as Western powers did, how can it claim to be a member of the Global South, let alone its leader? Instead, China's size and position in the global economy are making it a member of the Global North, whether it acknowledges it or

not. India is particularly vocal in this debate. India claims that it should be the leader of the Global South, not China for the reasons I have just mentioned. It has a semidemocratic system, a colonial history, and a level of development that make it more similar to the Global South than China is. So, that's one thing that Americans can take reassurance from - that India is challenging China for leadership in the Global

South. However, the other challenge that both China and the Global South pose to the United States is alignment of grievance-driven interests. This alignment could spread even further, such that one of the greatest international challenges to the Trump administration may be the ways in which members of the Global South begin coordinating their activities to make life difficult for the United States. They could pressure the United States to make concessions, and thus encourage it to back further away from its international economic and security

commitments. Just earlier today we heard a very interesting presentation about the way in which China's total GDP is coming very, very close to that of the United States. The most recent figures show that China has now reached about 70% of the U.S. in nominal terms, not in purchasing power parity. In other words, China is arguably catching up to the United States. Whether it will surpass the U.S., we don't know - it has serious problems of its own - but basically, the argument being made was that the United States is not keeping up with the economic challenges it faces both at home and abroad.

As Trump is indicating, the U.S. may choose to back away from some of its foreign policy and security commitments unless it is compensated by the countries it has, until now, agreed to defend. The United States may have to retract its commitments to many other places or change its policies due to growing resistance from the Global South. So, the United States may do what the independence movements and World War II together forced Great Britain to do: to recognize its overextended commitments, adopt more mercantilist domestic and economic policies, and become a very different country than it was before.

Closely related to Global South is a more formal organization known as the "BRICS." These are the most dynamic, perhaps the largest, of the emerging markets. It is the acronym for Brazil, Russia, India, China, and South Africa. The BRICS are now expanding to include a lot of other countries, and that is changing its character in a fundamentally important way.

When the term BRICS was first developed by a researcher at Goldman Sachs, the idea was that these countries would move out of middle-income status to high-income status and, in so doing, would even become candidates for addition to the G-7, as they became more liberal both economically and politically, as they adopted elements of the Washington Consensus.

That has all changed. It is clear that they are not, and rather than being candidates for membership in the club, they now want to form an alternative club, with different political and economic institutions. That will be another challenge for the U.S. - perhaps a more diplomatic, ideological, and economic challenge than a military challenge - especially if they work together, with some of the more truly alienated countries: the Chinese, the Russians, the Iranians, and North Koreans (what some call the "CRINKS"), and possibly other countries that may try to make the United States' international position more difficult.

So, I think it's going to be a challenging time both domestically and internationally for Trump 2.0 because of continued divisions at home and the emergence of new rivals and challengers abroad. And since Trump 2.0 is really the same man as Trump 1.0, I think there are some very serious questions about his ability to respond effectively to these challenges.

Footnote

* This paper is a revised and edited version of the transcript of a keynote speech to the International Symposium on Indo-Pacific Security after the U.S. Presidential Election, held in Taipei on December 6, 2024, and organized by the Institute of International Relations at National Chengchi University.