Harris vs Trump, and the foreign policy shake-up ahead

Whoever wins the November presidential election in the United States, foreign policy is in for a shake-up and the world will be a more uncertain place. But liberal democracies like Australia have agency – we can respond by building on existing partnerships and creating new ones with like-minded countries to maintain the global rules-based order.

The stakes could not be higher. The first land war in Europe since 1945, the latest phase in the Israeli-Palestinian conflict and a tech and trade cold war in the Indo-Pacific. The axis of Russia, China, North Korea and Iran is bent on reshaping the international order to make the world safe for autocracies. Grey zone activities are at an all-time high with open societies targeted for misinformation, disinformation and cyber disruption.

Former president Donald Trump has form as commander-in-chief and Vice President Kamala Harris has been President Joe Biden’s understudy. However, Biden’s foreign policy chops will be missed. He reunited the allies and partners after the Trump years. He rallied NATO in the face of Russian aggression, brought Japan and South Korea closer together, an important legacy of his presidency, and promoted new groupings such as AUKUS, the Quad leaders meeting and other minilaterals in the Indo-Pacific. He also took the United States back into the Pacific and engaged actively with the countries of ASEAN. This direction is expected to continue under a President Harris.

Economic and trade engagement was the Achilles heel of the Biden administration. The Indo-Pacific Economic Framework had some useful initiatives on supply chains but did not cut it with allies and partners because of the absence of market access proposals. Both political parties in the United States are wary of such trade agreements, given the public disquiet over job losses attributed to international trade, and particularly the opening to China.

However, the next president will face allies and partners that are doing more for themselves. Military spending is growing across the Indo-Pacific. Japan, South Korea and the Philippines are each stepping up, as well as Australia. We see more regional cooperation with each other as well as with the United States. In Europe, NATO has found new purpose and resolve.

Trump suggests that he can create a more peaceful global environment because he can deal with the strongmen of Russia, China and North Korea, that they respect him and vice versa. Should he win, expect more moves from left field such as his outreach to Kim Jong-un. Such lateral thinking may have its place, but a foreign policy that devolves to America First and America Only dilutes America’s unique geostrategic advantage and unparalleled network of allies and partners. In such an environment, liberal democracies will have to consider what more they do to fill the void.

Trump would settle the Ukraine war in one day, not with Kissingerian shuttle diplomacy but pressure on Ukraine, presumably on terms more favourable to Russia. Congress will have views on this, not necessarily to Trump’s liking. Ukraine is seeking to do more now – witness the incursion into Russian territory – as a possible leverage point in negotiations.

Trump wants the Israelis to finish the job in Gaza sooner rather than later and is assiduously courting the Jewish vote. There is no guarantee of a quick end to the fighting, and what to do with a post-war Gaza will loom as a knotty foreign policy test for the next American president. Heightened tensions with Iran will complicate a Gaza settlement and require patient, deft diplomacy, including how to rein in Benjamin Netanyahu and avoid a widening conflict.

Trump has flagged a 60 per cent tariff on Chinese exports to the United States. Since his original tariffs on China in his first term, the trade deficit has widened in China’s favour. Biden did not remove the Trump-era tariffs, this now bipartisan policy. Trump (and Biden) were right to acknowledge that China has rorted the international trading system to its advantage and denied genuine reciprocity in trade and investment.

However, tariffs will not solve this issue. The trade imbalances are the outcome of the balance between domestic saving and investment. China needs to consume more and save (and invest) less, and vice versa for the United States. In the absence of such adjustments, imbalances will continue to fuel restrictive trade measures. Combined with a ten per cent tariff all round, this may well prompt a trade war and beggar thy neighbour policies.

China could offer Trump a grand trade bargain to avoid swingeing tariffs. China could offer to buy more from the United States in exchange for, inter alia, security guarantees on the South China Sea and Taiwan. Trump could be tempted – he has railed against America’s security guarantee to Taiwan and its chips dominance. However, Republicans overall are very sympathetic to Taiwan (and even want to recognise Taipei, a red line to Beijing), which could put a brake on such a deal.

Trump is unlikely to scrap AUKUS, which has a lot of support on Capitol Hill and in national security circles. He could ask for more Australian funding of the US submarine industrial base. His administration revived the Quad at the foreign minister level, so he is also likely to agree to leaders’ meetings continuing. He will likely increase tech controls on China and encourage more onshoring of critical national security supply chains. Do not expect the same level of interest in the Pacific or ASEAN.

Harris is likely to retain much of the Biden team, with the possible exceptions of the Secretary of State Antony Blinken and the Secretary of Defence Lloyd Austin, given it’s been a hard four years. Harris likes Kurt Campbell, and his retention in a senior administration role would guarantee continuity of Indo-Pacific policy and getting AUKUS done.

Tone may change. As we have seen with Harris’ comments on the humanitarian crisis in Gaza, she may also take a slightly more sceptical line on India. Overall, expect more focus on democracy and human rights, although not at the expense of core interests. Harris will also focus on tackling the tech competition with China. Space and AI already figure prominently in her thinking.

Whoever is in power over the next four years, there is an opportunity for creative diplomacy by Australia to put more issues back on the table. The hardest and most rewarding area will be trade-related market access measures, perhaps starting with a digital trade agreement to push back against digital authoritarianism in the Indo-Pacific.

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