Shashank Joshi, Defence editor for The Economist, and Simon Rabinovich, U.S. economics editor for The Economist, dive into the implications of the U.S. allowing Ukraine to use long-range missiles against Russia. They discuss President Biden's shift in strategy and the geopolitical ramifications. The conversation also touches on Trump's economic policies and their mixed long-term effects on the stock market. Lastly, they explore the revival of airships, highlighting their potential in cargo transport and innovative delivery systems.
The US decision to allow Ukraine to use long-range missiles against Russian targets marks a significant shift in military strategy amid escalating tensions.
Donald Trump's economic policies, known as Trumponomics, could lead to increased fiscal deficit and inflation despite initial market optimism from tax cuts and deregulation.
Deep dives
Ukraine's Use of Long-Range Missiles
Ukraine has been granted permission to utilize US-supplied long-range missiles against Russian targets, marking a significant policy shift. This decision, although not yet officially confirmed, was indicated by President Zelensky, who believes it will bolster Ukraine’s morale and strengthen its position in potential negotiations. The American administration's delay in this decision was largely influenced by concerns over escalating tensions with Russia and North Korean involvement in the conflict. Vital targets for Ukraine include command posts and logistics hubs, particularly in the Kursk region, although this strategic limitation raises questions about military efficacy.
Trumponomics and Its Implications
Donald Trump's economic policies, referred to as Trumponomics, focus on tax cuts, deregulation, tariffs, and immigration controls. His plans include extending previous tax cuts and possibly reducing corporate tax rates while facing concerns about significantly increasing the fiscal deficit. Deregulation will aim to reverse tighter controls on industries like banking and tech, potentially boosting economic growth, but this could also lead to higher inflation. The resultant tariffs, particularly against China, pose a risk of increased costs for consumers and may lead to a reassessment of the positive market sentiments currently driving stocks high.
Revival of Airship Technology
Airships, once a relic of the past, are experiencing renewed interest as innovative companies explore their potential for cargo transport. Their proven fuel efficiency and favorable lift-to-drag ratio make them appealing alternatives for moving goods, despite challenges like variable buoyancy. Developing solutions such as using ballast water for weight adjustments has shown promise, especially for heavy logistical tasks, like transporting timber. Companies are even conceptualizing 'flying warehouses' that operate as hubs for drone deliveries, indicating a creative shift in logistics that could reshape air transport.
America feared that letting Ukraine use US weapons to attack far-off targets in Russia would escalate the conflict. Why has President Joe Biden finally changed his mind? Markets soared when Donald Trump was elected, but the longer-term impact of Trumponomics may be less positive (9:42). And why airships are back in our skies (18:12).