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The New Old Cold War with Tooze and Klein
The nuclear threat, EU and Chinese responses to Ukraine, Ukraine-Taiwan analogies and the risks of romanticising a crisis
Columbia University’s Adam Tooze and founder of The Overshoot Matt Klein have returned to ChinaTalk to discuss the war in Ukraine, weighing in on European solidarity with Ukraine, how China is a wildcard in this new iteration of the Old Cold War, and the future of US strategy in both Europe and the Asia-Pacific.
This episode was originally recorded on the evening of Sunday, Feb 27. Do check out the podcast feed which features four other emergency episodes I published over the weekend on Putin, the cyber dimension, and the view from Prague I put out as a fundraiser for Global Giving’s Ukraine crisis relief fund.
Transcription and editing by Callan Quinn.
Nuclear forces on high alert
Jordan Schneider: Where do we start?
Adam Tooze: I don't think I can remember a scarier moment. And I'm so old I remember the 1980s. I had this horrifying realization last night after the joint transatlantic sanctions declaration that the next obvious step was exactly where we ended up heading this Sunday morning, which was some sort of escalation into the nuclear space on the Russian side.
Maybe for all our talk about Iran-style sanctions on Russia, we've missed the rather obvious point that the point of the Iran sanctions is to stop them from getting nuclear weapons. Russia has them.
I think it’s just a new step in the rhetoric and the imagining on the Russian side of what kind of a crisis we're in. You could have expected them to counter European and American financial and economic sanctions by cutting off oil and gas. There's a bit of me that thinks the Europeans and Americans want them to do that because it'll spare us the political cost of having to do it from our side.
Jordan Schneider: And it’s not just pure bluff?
Adam Tooze: I don’t want to find out. And I don't think we want to play the game of trying to find out either, to be honest.
Matt Klein: I guess the question then becomes, to the extent that it seems as if the Russian government and Russian society were not prepared to face any kind of resistance, whether we think that any sort of escalation to nuclear would be predicated in part on the presumption that the government remains unified in its objectives.
That might not necessarily be an accurate reflection of how this plays out. They expected it to go a lot more smoothly. There are a lot of potential outcomes here but one non-trivial possibility is that even if Putin might want to do something or other people close to him might want to do something, they might not be the ones in charge to make that kind of decision if it were to lead to the kind of escalation that you're reasonably concerned about.
Adam Tooze: I got freaked out when there was a spoof tweet that went around about [Russian general Valery] Gerasimov having been moved to the side.
If we see substantial changes in the military command chain at a moment like this, that would be cause for acute alarm.
There was a piece in the Washington Post [on Sunday] about personalism as a form of authoritarian rule. And the more bureaucratic, the more multipolar [it is] within Putin's apparatus, the more checks and balances there are, the more secure I certainly feel about the situation.
The more this becomes a matter of his personal pride and dignity and the fewer checks there are on decisions being driven by that kind of logic, the more alarming the situation becomes.
Even if this isn't total escalation to global nuclear war or a full-on exchange with the United States, there were a whole bunch of scenarios short of that which will be absolutely terrible from a European point of view.
The European Response
Adam Tooze: What is extraordinary also is the boundaries right between NATO, the EU and Ukraine. Two weeks ago everyone was clear about two things: that it wasn't part of the EU, and it wasn't part of NATO, nor was it going to be ever for the foreseeable future.
And that was our line to Putin, that he was being completely unrealistic and it's not going to happen. [President of the EU Commission Ursula] von der Leyen has declared that she wants to see Ukraine as part of the EU. That is cheap talk obviously but it's unprecedented. It's tantamount to a kind of verbal form of the ‘08 Bush line on Ukraine, which I have always regarded as causally significant in this entire crisis.
Jordan Schneider: On the EU side we have fighter jets now apparently getting transferred [to Ukraine].
Adam Tooze: From the point of view of the history of the EU, this looks as though it's going to be a truly dramatic moment.
Matt Klein: Putin deserves a Monnet Prize arguably for this stunt of integration and solidarity we’re seeing in Europe. Christian Lindner laughing at the CDU for saying that it's going to increase the deficit when they're talking about more defense... That’s the head of the FDP, notorious for being head of fiscal austerity, saying we're going to spend a hundred billion a year on defense, that it's an investment in our freedom and who are you to talk about the debt right now.
Adam Tooze: He's declared renewable energy to be “freedom energy”. And on the other hand on the other hand [Vice-Chancellor Robert] Habeck, with respect to both sides, seriously entertaining conversations about extending the life of the nuclear facilities, including with the senior figures in [Germany energy company] RWE. So there's clearly give and take on the part of the major coalition partners.
The really striking thing is the silence of the SPD relatively speaking compared to the really major presence of both [Minister for Foreign Affairs Annalena] Baerbok. Habeck and Lindner in this drama.
Jordan Schneider: Is this what's going to save the world from climate change?
Adam Tooze: I'm not sure I entirely trust the source but there was this Intercept piece about the relationship between MBS and Putin and Saudi and Russia, and that you could see the hardening of some sort of last-ditch fossil fuel redoubt emerging.
That's many people's anxiety because there's a nice scenario about that where we have, as it were, a consensual cut back in fossil fuel demand globally driven by Eurasian de-carbonization. That leaves the Saudis by happy chance as the last supplier standing, which reduces the geopolitical pressure.
If this heads in this other direction, you can imagine more toxic scenarios. But that's a time horizon that's very different from the one that we're currently in.
Jordan Schneider: Adam, how does the response match your expectations? What are the causes that are driving it?
Adam Tooze: For an American audience, the first thing to say is there's a huge European response right now. It's sort of staggering. If you leave Twitter and go into normal America, it’s just one story among a whole bunch of other stories.
Berlin [on Sunday] saw 100,000 people on the streets. It's absolutely staggering.
But I also think that the fact of the matter is that if the Russians had been able to carry out this invasion in the way that most of us expected them to be able to do it, namely just a roll through the Ukrainian resistance in a matter of hours and push their way to Kyiv, I'm pretty certain also that Europe would simply have shrugged.
I don't think that we would be seeing what we're seeing right now. I think it's a huge dynamic and it’s going to be very hard to resist from the point of view of politicians, many of whom were previously reluctant to do anything.
Jordan Schneider: Is it the moral example of the Ukrainians fighting for themselves? Is it the possibility that this could not end in a Russian takeover? What is it exactly that has sparked this across Europe?
Matt Klein: I think the perception a lot of people had, including a lot of people in the US and the perception in many ways that Putin probably had, was that the Ukrainian government was just this very fragile façade that no one cared about, that the idea of Ukrainian nationalism wasn't a thing and therefore that it would be easy to roll over them. We're seeing very clearly through a lot of violence that's not true at all.
Actually, there is a Ukrainian state, there is a sense of legitimacy of the Ukrainian government, the Ukrainian people are willing to fight and organize in a very meaningful way. The Russians are not being welcomed.
Matt Klein: The fact that Sweden, which has defined itself for so long internationally as being a neutral power, is sending stinger missiles and anti-tank weapons to Ukraine to fight Russians is remarkable. This is not the kind of thing that anyone would have thought would happen.
I remember at the end of last year being a little more optimistic than you Adam about the prospects of European fiscal expansion. Considering the various elections that have occurred in European countries, some of which got more attention than others, it's that and the interaction of events that we're not anticipating which is remarkable.
Everything else that's happening is terrible but that could be a positive consequence of this. Hopefully, there can be this sense of the possibilities and value of European solidarity.
Adam Tooze: The risk here is that we are caught in euphoria like the German reaction in 2015 to their initial response to the refugee crisis, which has some similar aspects. And then, of course, Europe was massively divided in 2016.
It's a bit like with fiscal austerity, right? It doesn't hit you in 2008. It hits you in 2010. There is a cycle of euphoria followed by a hangover. And I would fear that again in this case.
The reaction to the Ukrainian refugees that we're seeing across Europe - I've been talking to European friends today and people are jumping in vans and driving to the border to help out to show their solidarity - is very much the vibe of Germany in 2015.
And we've also been following the truly scandalous treatment of people of color on the border by border guards on both sides. I gathered the Nigerian foreign ministry is now finally in touch with the Ukrainians to tell them to get their act together and that this is unacceptable.
Jordan Schneider: Matt do you want to give the NATO sanctions a spin?
Matt Klein: The way sanctions work at the end of the day is that you're preventing transactions that would have occurred. The normal boring Econ 101, which I think is basically right, is that those transactions are good for both sides. So if you're preventing those transactions, you're hurting the side you're targeting but you have to be willing to hurt yourself. It doesn't work otherwise.
One way of looking at it is like a hunger strike. Hunger strikes can be very effective but you have to be willing to go hungry. The question then becomes if you're going to do this to Russia. Russia has significant economic and financial exposure to Europe.
The fact that the Europeans were initially hesitant to do these kinds of sanctions makes perfect sense because there would be a real cost to them. The fact they're willing to do it now is encouraging in terms of their sense of solidarity, but it is going to be potentially difficult to sustain to the extent that it's going to be hitting a lot of their exports.
As you were saying, there's the initial euphoria and then there's the hangover.
If you want to avoid that, because there is that economic shock and Russia is going to redound back to Europe and, quite frankly, through Europe the US, there has to be some kind of plan in place to offset that.
I think it can be offset, except for gas. That's a tricky one because that's a physical constraint but everything else I think can be offset and we should be thinking about how to do that to make this work. [Note: After this podcast we wrote an oped elaborating on this idea—if you want to run it, reach out]
Will this change relationships with China?
Jordan Schneider: How much do you think this is going to have both the EU and the US reimagine their relationship with China going forward?
Adam Tooze: We used to say things like the New Cold War with China is different because we are deeply entangled with them economically.
And here we are having some sort of terrifying replay of the Old Cold War with a country we are deeply entangled with which, unlike China, even if it doesn't prioritize first strike capacity nevertheless has a highly capable serious nuclear arsenal, which China doesn't have.
Let's not get confused about what paradigm we're dealing with here because I do think China is radically different again. It depends a lot on how the Chinese themselves choose to play it. We're only just at the very beginning of seeing how that plays out.
Matt Klein: Jordan, how do you think the Chinese are viewing this?
Jordan Schneider: In terms of DnD alignment charts, Putin is chaotic evil. I think Xi is lawful evil. I think this sort of insanity and the speed of it is too fast for him. I don't think he's the type of leader that is excited to see these sorts of dramatic shifts on the global stage the way, say, Mao or Lenin would.
My very hottake on Taiwan is I think this helps Taiwan in that people are going to take Taiwan a lot more seriously than they may have before because of the lesson of not taking Ukraine seriously.
It’s going to make it a whole lot easier for Taiwan to make the case that they need just as much support as they've been asking for.
Matt Klein: Shinzo Abe explicitly called for that yesterday, right? He said we have to explicitly defend Taiwan. That’s a change.
Jordan Schneider: The fact that Japan is on board with all of this is a really interesting one. I'm no expert in Russia-Japan relations but throughout Putin's reign, there have been some relative high points in that relationship and to see them come out so dramatically and be in lockstep with the west on this is a real reflection of the fact that folks around the world are seeing these issues as connected.
If we had the contingency of this ending in 48 hours and the US and EU kind of shrugging, then I would be a lot more concerned that the deterrence that folks are hoping is real enough in Beijing policymakers’ minds to deter them from doing anything in Taiwan would be dramatically eroded.
Adam Tooze: So if you started with the previous model in which Ukraine was a weak state that could be rolled over quickly, then of course it never made any sense to analogize between Taiwan and Ukraine. Taiwan is not that. It's a highly capable, high-income country with incredible technological capacity.
Matt Klein: And they have a very close relationship with the US military.
Adam Tooze: There are explicit American security commitments, the whole works, so it never made any sense to me to analogize between Ukraine and Taiwan.
On that basis, I was always confident in saying China is too smart to learn any lessons from Ukraine. Ukraine is sui generis, Taiwan is as well.
I'm not at all reassured by war in Ukraine with nuclear escalation and a very uncertain outcome, which I'm pretty confident is still going to be grim, suddenly being used as an analogy for Taiwan. I understand why that's happening but I felt better in a world in which they were hygienically separate. Not because I don't take deterrence in Taiwan seriously, but because I just didn't think Ukraine was a useful analogy.
If it does become that, it may indeed harden the understanding of the deterrence or it may just dramatize and romanticize. What worries me about what I'm seeing in Europe right now is romanticism. And not because I reject that per se or because it isn't praiseworthy or I don't get it - it's hard not to thrill what's going on, it's unbelievable what they're doing - but does it really change our mind about what we expect the likely outcome of this to be, except in a negative direction?
Jordan Schneider: I want to explore that point cause I don't quite understand it. So the romanticism is over-estimating the Ukrainian forces’ chances?
Adam Tooze: Well, first of all, it's thrilling to these acts of what may turn out to be suicidal resistance and precariously from a position of extreme great safety engaging in a kind of romantic celebration of them. I know that's what the Ukrainians are calling for. They, in their moment of resistance, want solidarity and appreciate the show of solidarity.
But the question that we surely have to ask ourselves is what the outcome is going to be. Do we think it materially changes the odds to a point where it becomes reasonable to back those odds? And coming from the point that I was at a week ago that seems unlikely. It is possible that all my priors were completely wrong and the Russians are a paper tiger and the Ukrainians are completely different from what I imagined. But I fear that they're not that wrong.
And I fear that what will ultimately push the game back into the Russians’ camp is just the overwhelming application of heavy artillery. And that's a terrifying prospect.
Is Russia China’s new North Korea?
Matt Klein: Going back to China, I'm curious what you think of the fact that at the Security Council China did not vote against the resolution?
Adam Tooze: It’s because the Americans modified it. They asked it to express dismay rather than to declare it illegal or something.
Matt Klein: Given the dramatic expressions of friendship and the new Sino-Russian Alliance, it's striking. And then I think there were some reports about Chinese banks cutting back on some commodity exposures to Russia.
I don't know how much of a deal that is. But as long as we're doing hottakes, I wonder at what point Xi Jinping starts to view Russia as another North Korea as opposed to what they probably thought they were getting when they made this arrangement.
Adam Tooze: That's everyone's question. I think that's a nice way of formulating it: if they're not Iran are they North Korea? I was struck by that report where FT journalists had been contacted by their contacts in the Chinese foreign ministry and they'd been seriously and sincerely asking whether or not this was all just fake news from the west.
So there is also an information bubble aspect to this which is non-trivial. I hesitate to invoke reality in a situation as polarized and partisan as this and I never know how much to read into this, but the accounts one gets of the inner circles of decision-making in Beijing suggest that, as may be the case for large segments of Russian opinion, that there is a gap between their perception of the world and reality on the ground.
And so for very well-placed, senior Chinese officials to be so insecure in their judgment of the situation that they were asking Western journalists for context and reassurance is quite telling.
Jordan Schneider: No one on the State Council has spent much time abroad. I guess they have kids who are studying in the West but that doesn't count.
There is a part of China that is worried about betting on the wrong horse. I think you're going to see it in the coming weeks and months. Because China is the only lifeline to Russia for a lot of these sorts of imports which are about to skew pretty dramatically and have a really dramatic impact on Russian industry and ordinary Russians’ wellbeing. I don’t think many Chinese financial firms and companies absent major government pressure are going to be willing to risk pretty dramatic secondary sanctions to sell into a not particularly important market.
Adam Tooze: I'm fascinated by the Indian geopolitical dimension here.
The other people to abstain were the UAE, which was quite something because they used to be touted in the Trump era as America's cat’s paw in the Gulf. The Spartans of the Golf was like the tag line for the UAE.
And then India. India abstains despite featuring only just the other week in America's new Indo-Pacific strategy as the horse that they have hitched America to, the rise of India is now something America officially backs, apparently heedless of the impact on everyone else in the region. The rise of India is a good thing. We're sharing that. We're celebrating it. Nevertheless, they abstain.
The argument is they're so closely associated with Russia, historically their entire military kit comes from Russia, and they can't just simply pull away.
And they're really worried about the possible encirclement that the China-Russia-Pakistan kind of envelope puts around them. And who was in Moscow on the day the offensive began? [Pakistan Prime Minister] Imran Khan.
Jordan Schneider: Good luck getting any new spare parts from the Russian Federation anytime soon.
Adam Tooze: They don't seem to have an abundance supply even for their own equipment. But I think that's a very interesting dynamic, right? The way in which the new Old Cold War with Russia immediately intersects with the New Cold War with China.
Matt Klein: If US relations with Iran and China improve at the same time as deteriorating with Russia and India that would be a real throwback to pre-1979.
The future of the “Pivot to Asia”
Jordan Schneider: Let’s talk about Biden's foreign policy. We’ve got TTC on the rise, Japan “2+2” looking okay, some questions about the Quad. To what extent does the Pivot to Asia become threatened or emboldened by all of this?
Adam Tooze: My line 48 hours ago was we are Politik-ruled. In fact, I did an entire podcast on Friday with Ezra Klein which we're going to have to completely record on Monday, under the premise of Biden realpolitik rules. They've been incredibly hard-line on Afghanistan, they've been incredibly hard-line on Ukraine. No distractions, no commitments. If Russia wants this mess, it can have this mess, was the line it seemed to me that they were taking.
And I don't know whether they're going to be able to sustain that position now this isn't zero-sum. It’s a pretty weird calculus to say this needs to be zero-sum. If there's one thing that Congress will agree to it's another a hundred billion for defense. That isn't going to be a problem on the American side, so if you needed to do both you could certainly do it.
In some senses, it would confirm the underlying suspicion that Russia and China were a package anyway. That was always there in the strategic docents from 2017 onwards. You had a Big Satan and Little Satan, and the balance between them has shifted.
And I'm sure the message from Biden’s people to the Europeans is that we told you so. You folks needed to get real. You needed to get serious. And if you don't learn the lesson now there's really no helping you. If there's anything we can help with, know we'll do our best, but otherwise you folks need to step up now. And that seems to be the message that the Europeans are actually running with.
Matt Klein: In some ways the fact that Europeans have responded the way they have shows how positive some of it could be because essentially the US doesn’t need to commit to anything like in terms of actual military force to Europe at all as a consequence of this. It hasn’t needed to as the Europeans are [doing so] independently.
At the same time, we're also seeing, rightly or wrongly, some of the perceptions that the Russian attack on Ukraine could be analogized to a Chinese attack on Taiwan, [things like] what Japan has been saying.
There's clearly a dynamic there. We've seen there's a real latent capacity of the democracies to actually project a lot more power than probably people had thought.
Adam Tooze: This story could still tip though. By the end of this coming week, we could be looking at a couple of ruined Ukrainian cities the Russians triumphant and everyone asking the question of why the hell was it only stingers and belated offers of Eurofighters.
In the end, this story could still end the way it looked as though it was going to end, but in a sense with more broken hearts and more crushed romanticism.
And on Europe's defense, the truth is they don't need to spend a single euro more. They already outspend Russia by a handsome margin, even with purchasing power parity adjustment to the Russian spending figures. They just spend it in such a historically abusively wasteful way that they get practically nothing for it.
The fact of the matter is that that Commander-in-Chief of the German army went on LinkedIn of all media to make a historic declaration that at a moment of crisis he, as one of Germany's leading soldiers, was “empty-handed.”
So yes, they scrambled together a couple of anti-tank missiles and they're going to ship them out there, and that's a big deal historically no denying it, but the fact of the matter is that they’re pathetically underpowered at this moment and can deliver virtually nothing. And this wasn't true of Germany as recently as the late 1980s.
Would Putin accept a defeat?
Matt Klein: China's going to be a really interesting wild card here in terms of how they choose to respond. Their ability to help Russia in this time is not unlimited by any means but it is substantial. If they decide that this is a very blatant violation of everything they say they care about in terms of national sovereignty and borders and actually stick with that or even simply just not help, I think that would be significant.
I have no idea how it's going to play out. It could go a lot of different ways. I think we should certainly be prepared for the possibility it will become much more violent and much more destructive than it already has been.
Adam Tooze: I think the more you bring it back to Ukraine itself and the problem of Ukraine and its relationships with Russia, the more the mood shifts from a sort of euphoria about what this may mean for Europe to just the really tough reality that it's very difficult. It was very difficult before this happened to see how a compromise was possible and now it's vastly harder to imagine.
We of course warm ourselves with the prospect of a Ukrainian victory. Ultimately, I think at this point that seems to be the idea, right? That somehow through this heroic defense they will stop the Russian offensive? The Russians will abandon the offensive and on that basis, some kind of peace can be made?
But that's a defeat, an utter crushing humiliating defeat for the Kremlin and Putin, and I just don't see how he could accept it.
If you put those two things together, the lack of a possibility of a compromise and the impossibility of Russia accepting defeat, it's a recipe for some very grim and very high-risk scenarios.
Jordan Schneider: What are the signs of regime stability? What's your sort of reading on the balance of internal power?
Adam Tooze: The smart stuff I've read says... the men of violence, the men of force, the security services really dominate the scene. The oligarchs are kept in their place. They get rich, they collaborate, they provide technical functions of various types, but the deal is they say nothing about grand strategy and nothing about broader politics.
The fact that some of them have spoken out in various tentative ways is remarkable but probably not all that consequential because they don't hold power.
It's the hardcore of the security apparatus that does, and watching for tremors within that requires a level of insight and knowledge that certainly no one I'm able to read in real-time in the west appears to have.
Jordan Schneider: That Security Council meeting was really something. Is there any analogy that came to mind for other of you?
Matt Klein: I wouldn't normally feel sorry for the head of Russian foreign intelligence given what we know they've been up to over the years, but honestly the analogy I came up with - and maybe this is not fair - is the way Mao or Stalin used to humiliate people.
Presumably, that guy doesn't feel good about his position, which creates interesting dynamics. On the other hand, the fact that Putin feels comfortable doing it tells you about his state of mind and his view of his position.
What I thought the world was a week and a half ago is not the way it was. And that's been very disorienting.
Want more? Check out the full show alongside four other emergency podcast episodes I recorded over the weekend.
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