The 118th U.S. Congress, North American Leaders’ Summit, China Reopens, and More

MCMAHON:
In the coming week, a new U.S. Congress embarks on its first full week. North America's leaders meet in Mexico City. And, China reopens its borders. It's January 5th, 2023 and time for The World Next Week. I'm Bob McMahon.

LINDSAY:
And, I'm Jim Lindsay.

MCMAHON:
Jim, let's start here in the nation's capital. This past Tuesday, lawmakers convened for the first day of the 118th Congress and an important step for new Congress is to elect a speaker of the House, but that has become historically difficult for House Republicans who hold the majority. They've failed multiple times, and as we're taping this podcast, other attempts were being made, but with such a bumpy start. Jim, how do you think this first full week will go for the new Congress?

LINDSAY:
Expect more bumps, Bob. I expect that's what we're going to be seeing both next week and over the next two years of this Congress. I should note that this is a fluid situation. We're sitting down before the House reconvenes to begin another set of votes on selecting a speaker. It's touch and go as to whether there'll be a breakthrough or not, but again, I think the big takeaway from this is that the next two years are going to be fairly turbulent and chaotic. For history buffs, this is the fifteenth time in U.S. history and the first time in 100 years that the election of the speaker has gone to multiple ballots. My guess is that the 118th House will not touch the record set back by the thirty-fourth house, which took 133 ballots in 1855 before selecting Nathaniel Banks of Massachusetts as speaker. 

You could maybe get asked about that in your next trivia quiz. People need to keep in mind that selecting the speaker is the first order of business for every new House and until they select a speaker, members can't be sworn in. So, technically they're all still representatives elect. The rules governed in the House have yet to be adopted. Committee assignments have yet to be made. I think one of the consequences of this essentially food fight in the Republican House Conference is that there's going to be a lot of lingering bad blood in Republican circles. Keep in mind that nine out of ten GOP lawmakers in the House voted to make McCarthy speaker. They are visibly frustrated. One of them, Dan Crenshaw called his fellow Republicans, "the holdouts, clowns, and terrorists." Another House Republican, Don Bacon of Nebraska said his colleagues have begun referring to those voting against McCarthy as, "the Taliban 19." Other terms I've heard being tossed around are things like the Crazy Caucus and the Chaos Caucus. I'll note that former Speaker of the House Newt Gingrich, a fellow Republican, has referred to those voting against McCarthy as "blackmailers."

Now, these gibes don't seem to faze the Republican holdouts. Andy Biggs of Arizona who opposed McCarthy on the first ballot tweeted, "I'm running for speaker to break the establishment. Kevin McCarthy was created by, elevated by, and maintained by the establishment." So, whoever ends up becoming speaker of the House of Representatives is going to face a divided Republican House Conference. Some of that division is political, a lot of it's going to be personal. It's going to be very hard to overcome that. Keep in mind, at the end of the day, the House of Representatives is responsible for governing and it's going to be very hard for it to do just that.

MCMAHON:
Jim, before we get into what this might mean for U.S. stature, let alone U.S. ability to create policies in which the legislature is involved, there have been floated some ideas, possibly fanciful ideas of some sort of approach in which there's common cause between Republicans and Democrats and there's a consensus pick that emerges. Can you play out what the prospects are for that? So, just so anybody listening has a sense of how we should regard that.

LINDSAY:
The conventional wisdom is the odds of having some sort of bipartisan coalition are somewhere between zero and nil, that it is not in the interest of either political party to be able to do so. Again, if you look at it from the vantage point of Democrats, they are at least in the short term looking at this as a benefit for them. It's sending a signal that the Republicans have won control of the House and they can't do the first and presumably easiest thing any House has to do, which is elect a new speaker, and I think for many Democratic lawmakers, Democratic strategists, they believe that if the Republicans are having trouble, that is going to redound to Democrat's advantage come 2024. 

In terms of Republicans, if you look at the majority of the 90 percent of House Republicans that want McCarthy to be speaker, they want to have a speaker elected by Republicans, not a speaker elected in cooperation with the Democrats. And, I would imagine that if Kevin McCarthy were to reach out to Democrats to try to fashion some sort of deal, which he has not done to this point, he would probably lose a lot of support in the House Republican Conference. So, I don't think we're going to see the emergence of some sort of bipartisan candidate for speaker, nor do I think we're going to see somebody be asked to become speaker who sits outside of the House. In theory, the Constitution permits any person, any American citizen of eligible voting age, to be speaker of the house, but I don't imagine that we're going to see somebody who's not a representative elect be selected to be speaker of the House.

At the end of the day, Republicans are going to have to figure out who is going to be their speaker, and I think the interesting thing to watch, and by the time this podcast goes live, some of this may have already begun to break, is at what point do the people who support Kevin McCarthy decide to throw in the towel that this is not going to work and they need to find an alternative candidate. Or conversely, does Kevin McCarthy put together a package that gets those who are currently opposed to his speakership to agree to support him. 

The wild card in all this is five House Republican lawmakers who have said they will not vote for Kevin McCarthy under any circumstances. The reason that's critical is because McCarthy can only afford to lose four House Republicans to become speaker. Now, here I have to go all political sciencey on you and give you a caveat, that assumes that members actually vote as opposed to absent themselves from the floor and not vote or cast a vote present because the way this works is that you have to win a majority of the votes that are cast, and people who were absent themselves from the floor or cast a present vote don't count in that calculation.

MCMAHON:
Now, there was a lot of contrasting going on last 24 hours on the media between the House and the Senate where you actually had Republican leader Mitch McConnell, shaking hands with President Biden at an infrastructure appearance, I believe in McConnell's home state of Kentucky, showing that things can get done between the two parties, and McConnell is certainly has had his share of history in fighting against Democrats on all sorts of fronts and has garnered no love for all sorts of moves he's made. However, he's also shown he's willing to walk across the aisle. So, what happens on the Senate side? And as we all get a great big civics lesson, what can the Senate do absent any sort of viable House?

LINDSAY:
Let's begin where you ended, Bob. The Senate cannot do much if the House is unable to act. Again, congress is a bicameral institution. It requires both houses to agree on legislation to move it to the president for signature. Yes, there are exceptions. The Senate alone votes on nominations, the Senate alone votes on whether to provide advice and consent to treaties, but the vast bulk of legislation that we're talking about require the two houses to work together. And I think the challenge for the 118th Congress once it gets a speaker and eventually will get a speaker, keep in mind these representatives elect don't get paid until they get sworn in. So, there's that inducement to want to eventually get a deal, but if we see a House that is unable to coalesce on legislation, think of sort of the most obvious pieces, annual appropriation bills, then things are going to shut down.

I think the big question mark many people have is, what is going to happen when we get to later this year, maybe early summer, maybe late summer, early fall, and the United States hits the debt ceiling limit? Republicans have been very vocal several months saying if they take over the House, which they have, they're going to demand big spending cuts from Democrats, and the Democratic response has been, "We're not going to negotiate. This is a must pass bill. We're not going to trade anything for it." And, here the problem is that if you default on the debt, which is what would happen if you don't agree to raise a debt ceiling, that could be calamitous for the markets, for the U.S. economy, but there are clearly a number of people in the House Republican Conference who based on past behavior, voting for government shutdowns and the like, are signaling that they're willing to run that risk because they believe it's very important to change the way Washington works and you could end up having a very, very bad outcome.

Now, I think the financial markets at this point aren't reacting to these threats at all. We've seen this movie many times before. There's a lot of posturing and we get to the moment of decision, a deal gets dropped, a debt ceiling gets raised, it'll be no different this time. That may be the most likely outcome, but I think given the determination that the small Republican group has demonstrated, you cannot rule out that you will get to the moment where you have to try to pass a debt ceiling bill and it won't pass in the House.

MCMAHON:
And, presumably some of these members of Congress might be hearing from constituents that they need to either double down or change their minds or whatever.

LINDSAY:
But this is the interesting question, Bob, and it gets to the issue of what are the incentives for all lawmakers. I think one of the things you're seeing among the House holdouts, Republican holdouts, is that for them the traditional incentives of wanting to advance in the House to get the approval of leadership, so you can get a more appealing committee assignment, that's not what's driving them. In many ways, their behavior is. Certainly, a lot of the criticism from their fellow Republican lawmakers fit on precisely this point. They're performative. Their reward system is by getting a lot of attention on social media, being able to go on television, various conservative news shows because that helps them raise money because their constituents aren't necessarily the people in their district, but people who are willing to give to their campaigns. And so when you end up in a situation in which the incentives are in essence to speak to a slice of the American public rather than to build bridges or ties with your fellow lawmakers, it becomes much more difficult to make Congress work.

And, this goes back to the point you made about Joe Biden and Senator McConnell showing up together. For Senator McConnell, there are very real incentives to want to be seen being bipartisan. One, Senator McConnell at the end of the day is an institutionalist. He wants to make government work. He may disagree with Joe Biden over what precisely needs to be done, what the marginal tax rate should be, things like that, but he wants government to work. Second thing is for McConnell, he's also a politician in the state of Kentucky, going to the state of Kentucky with the president, taking credit for bringing funds to Kentucky to improve bridges. I think there's particularly a bridge over the Ohio River connecting Kentucky with Ohio that is a very big deal for people who live there, so that's good politics for him.

And, I think he also wants to show more broadly to the American public that Republicans can get things done. He's also thinking toward 2024 and he does not want to end up in his 2024 becomes a wipeout for Republicans because the House Republicans couldn't get anything done, and that's the battle. And I think the interesting thing, getting back to incentives for the Biden administration, they want to work with Mitch McConnell. Biden and McConnell have a very long history. They were senators together-

MCMAHON:
Almost half a century.

LINDSAY:
They know how to do deals. You can say one thing in public and another thing in private, and so the Biden administration is going to be turning to Mitch McConnell, looking for him to sort of broker deals that are going in need with House Republicans. The problem for Mitch McConnell and the administration is, is there anybody at home on the Hill who can answer when McConnell knocks? Because again, these holdouts in the Republican party who don't like Kevin McCarthy, also don't like Mitch McConnell. So, they may not be willing to sign up to the kind of deals that legislators like McConnell can negotiate, and that again gets us back to the broader point. The next two years could be incredibly fractious, conflictual, and turbulent.

MCMAHON:
Another difficult period for the U.S.A. brand of democracy worldwide as well.

LINDSAY:
Yes, autocrats are going to have a field day reporting about dysfunction in American politics. 

Speaking of leadership in negotiations, Bob, next Tuesday, President Biden, Prime Minister Justin Trudeau, and President Andrés Manuel López Obrador will meet in Mexico City for the North American Leaders Summit. They'll focus on climate and environmental challenges, North American competitiveness, health and safety, migration, and DEI initiatives. What do we expect to emerge from this meeting, Bob?

MCMAHON:
Well, Jim, it's a big agenda at any time, but it certainly seems to be especially timely that these three leaders are getting together. I think two big areas you're going to hear a lot about are migration and a term like nearshoring or friendshoring, whatever kind of shoring you want to say, it's going to come up a lot. The first one, as we're taping this podcast, President Biden is expected to announce a time today where he's going to speak about U.S. immigration policy, which he's billed as an important message ahead of his trip down to this summit, and he is supposed to go either on his way or coming back from the summit to the U.S. border to speak about border issues. It would be his first visit there and it is probably the number one issue that he's been vilified by Republicans on and by his critics.

And so, great deal at stake in terms of finding some sort of common ground. I don't think we're going to see any sort of breakthrough necessarily, Jim, but some sort of common ground with the Mexican president, known as AMLO, about policy that could ease some of the pressure on the border. We just had a U.S. fiscal year where more than 2 million people were arrested for crossing the border. Now, some of those could be people who are repeat offenders, but it's still an incredible volume. That's not counting other sorts of detentions and arrests that have been made as well as people who are being processed through the asylum system and so forth. We are almost near historically high numbers, if not at historically high numbers of people trying to cross into the U.S. from that border. 

I haven't seen the latest rundown, Jim, in terms of how many are Mexicans, but it is quite a group, including most recently Cubans. Last year, 250,000 Cubans fled their country. Many of them worked their way and walked their way through Mexico to get to the U.S. border. You have Venezuelans, you have Haitians, you have the people from so-called northern triangle countries of Central America. Now, you add Nicaragua to that mix because their political situation is a mess. And so, all of which puts pressure on the U.S. but also Mexico. Mexico's fielding a lot of these people. They're dealing with the border situation. 

So, we should look for some sort of announcement about Mexico being assisted in some way, perhaps with bolstering its own southern border or other borders as well as helping to stave off this pressure on the border with the U.S. The other thing that's somewhat related with that, Jim, is as I mentioned this nearshoring comment, as our colleague Shannon O'Neil has pointed out with her new book about what she calls The Globalization Myth, there is a great deal of new emphasis on the U.S. trying to sort of take a page out of China's Belt and Road Initiative and recast attention or reinforce attention in its own near abroad and improve supply chains especially with Mexico and Canada.

It has big relationships with them already through their trade agreement, which even the Trump administration renegotiated and in some places doubled down on. The three countries are in need of bolstering their trade infrastructure, whether it's rail or roads, just ways of improving efficiency of goods, but also you've seen the U.S. administration, as Shannon has pointed out, they've given a green light to Canada and Mexico to subsidize electric vehicle batteries for example. They might have an opportunity to join U.S. semiconductors supply chains. We've noted repeatedly how the U.S. is cutting off China from the semiconductor technology, the high tech part of that.

So, we could be talking about a meeting in which we see maybe a new beginning in the way some crucial technology, some crucial supply chains are bolstered, revived and what have you, so that this trilateral relationship will really sort of play a role in the U.S. recasting its supply chain route away from Asia, away from China in particular, but even from Asia into its own region. And so, I think those are areas I think we should watch particularly strongly. The other issues are very important, but are much smaller in comparison.

LINDSAY:
And Bob, the list of issues you've laid out ties us back into where we began our conversation, which is the ability of the U.S. government, the 118th Congress to actually pass legislation to legislate, to govern, and here the prognosis is pretty grim. You're quite right that Republicans have been beating up Joe Biden about immigration issues since the day Biden took the oath of office, but we haven't been able to fix what pretty much everyone recognizes as a broken American immigration and asylum system. I don't see this Congress being able to rise up and overcome the political divisions and political posturing that has put us in this place. I also think that there was a lot of talk early on in the Biden administration about addressing some of the root causes of migration, why it is that people are fleeing their homelands to come to the American border. It's not at all obvious that you're going to see any effort by the United States government to do that. It costs money and again, this particular Congress seems to be pretty hostile or likely hostile to wanting to spend money elsewhere. 

Then you have this issue of how we should invest in infrastructure, friendshoring, bringing things home, and here you have headwinds not only in the United States because I'm not sure that, again, this Congress is going to pass legislation on this score, it was hard enough when Democrats controlled Congress to pass the infrastructure bill, which is usually or historically the easiest piece of legislation to pass, but also on the flip side, the Mexicans aren't terribly interested in deepening the ties to the United States.

AMLO, the president of Mexico is a nationalist, many ways a protectionist. He has a vision of, in his view, when Mexico was stronger before it began to open up, before NAFTA, before it began to deepen its ties with the rest of the world, and I think to a great extent, he wants to go back there. So, it doesn't seem to be a fertile time to actually do the things that most people who study these issues say should be a no-brainer for all three countries.

MCMAHON:
All of those are really good points, Jim, and it would take even with the most robust performance by the three leaders and professions of common cause and so forth to translate that into some of the things that are going to have to take place through the legislative process. It's going to take some wizardry and some skill that are not going to be available under the current landscape right now, unless we see some sort of dramatic change that emerges from this sort of crisis moment. And it's, as some have said, never let a good crisis go to waste. I'm paraphrasing there, but maybe that's going to be the result of this brinksmanship going on right now because it is really alarming and it is hurting areas in which there should be no no-brainer type of agreements that are made.

And it's also an early test, this is the first summit of the year for the Biden administration, and I think it's going to be a taste of how much his meetings with foreign leaders may ring hollow as his own domestic political situation continues to unravel.

LINDSAY:
Well, you put your finger Bob on the big foreign policy consequence. If other heads of state believe that the president of the United States cannot deliver on his words, then that president is going to be a lot weaker. I would like to be optimistic that this moment of crisis is going to produce a breakthrough. It could happen. I suspect it won't because everyone across the political spectrum has their eyes firmly set on 2024. I know 2022 is only a couple months behind us, but everything over the next two years is going to be refracted through the prism of 2024 and the prospect for Democrats of keeping the White House taking back full control of Congress, and for Republicans, trying to take back the Senate and the White House, and that is going to really, I think, complicate any effort to have a breakthrough. We sort of return to a more traditional, compromised approach to political issues. I think that's really going to be the case going forward, polarization, not compromise.

MCMAHON:
And, in some cases what sort of party the Republican party is. We've talked in passing before about the U.S. party set up and how kind of rigid it is and how some other major democracies benefit from the fact that you can have proportional representation that gets you past some of these divisions, but that's not in the cards for the U.S., so they're going to have to sort this out somehow.

LINDSAY:
Well, I think when you look at the current congressional Republican party, there are essentially two, maybe three different schools that exist there. You talk about MAGA Republicans versus conservative Republicans versus moderate Republicans. They're not formal parties themselves, but clearly they do not share a common vision of what the Republican party should be, other than that they want to beat Democrats in elections. And again, I think we're going to see this play out over and over again over the next two months about what it means to be Republican and what the Republican agenda should be. Keep in mind Republicans ran in 2020 and early again in 2022 without a platform and good part because they couldn't agree on one.

MCMAHON:
Well, Jim, I mentioned China in passing. China is dealing with some dramatic border developments of its own, namely the opening of its borders. On Sunday, China's going to lift its most strict COVID-19 rules with traveling in and out of the country. Given the recent surge of COVID cases, many countries such as Japan, Italy, the United States, Australia are putting in place mandatory testing for anyone coming from China. I believe in many cases it's people can't even leave China until they've had testing that's taken place. Initial testing that's happened has shown high levels of infection of Chinese travelers, so it's a rousing concern. We've gone over many rounds of surges. Jim, is this an area where we should be looking for another COVID surge or some sort of variant to be worried about?

LINDSAY:
Well, I think the issue of a COVID surge is about what's happening domestically in China, not that Chinese travelers are likely to bring more COVID to other countries. They certainly will in a technical sense, but the rest of the world is in a different position than China is because the rest of the world long ago gave up on this zero COVID policy. They've done a better job certainly in the developed world of having vaccinations. People who either have been vaccinated or weren't vaccinated have been exposed. So, there's some degree of natural immunity, and this is why I think a lot of public health experts say that these steps that countries like the United States, Japan, Italy have taken to require Chinese travelers either to take a test before they get on the plane or take a test as soon as they get off the plane isn't going to work to really diminish the amount of COVID transmission.

Again, here in the United States we're seeing upward of what, 1,000 people a week dying of COVID, so it's not as if COVID has left the United States or anywhere else. So, I think going forward for the Chinese and for Chinese travelers, they are going to have to go through this bureaucratic requirement. The Chinese government has already complained bitterly about this. It's another piece of tension in relations between China and many other countries, particularly in the Western world. I think the bigger story here though is both the speed with which China abandoned its zero COVID policy and the consequences of that decision. 

There's been a lot of discussions over the last six months about how in the world is China going to get out of this COVID cul-de-sac it's put itself in where it has been very successful at an increasingly higher cost in locking places down. It doesn't have people vaccinated, in part because the state didn't make it a priority. In part because people said, "Well, if we're going to have lockdowns, I'm not going to get infected. Why get the vaccination?" So, now all of a sudden you have a population of 1.3 billion people who are essentially in the position the rest of the world was in back in 2020. And the speculation was, well, the Chinese would develop vaccines, have a big vaccine campaign and slowly open up. That isn't what happened. It was like they went from a zero COVID strategy to "let her rip" and do what you want, and you're just seeing massive surges in COVID in China, leading Chinese figures in sports and opera and the like have died.

So, it's not as if the government can hide this up. The question is, what does that mean for legitimacy of Xi and his power, but also what does it mean for the Chinese economy? Because in the near term it may really disrupt the Chinese economy because so many people are ill, you can't work. We already had the end of last month Tesla shut down its factory and Shanghai.

MCMAHON:
And, we've seen the scenes that it predated the easing the lockdown of the Foxconn factories and so forth, pretty dramatic stuff.

LINDSAY:
So in a short one, it could really disrupt things, supply chains because again, if one factory shuts down, but it makes the part that ten factories need, those ten factories can't produce what they have to do, but the longer term thing is it's likely that the Chinese economy is going to rebound. That's what we've seen in lots of other countries once the lockdowns ended, began to open up in part because people had accumulated a lot of money that they couldn't spend and now they had an opportunity to go out travel, buy goods that they weren't buying before. And then the question becomes, how fast does the Chinese economy heat up? And, this is where I think a lot of people who do international economics are hoping for some sort of goldilocks outcome where the Chinese bounces not too big, not too small because if you are a trading partner of the Chinese, you want China to be booming because that means they're going to buy your stuff, they're going to buy your Australian ore, they're going to buy chips from Taiwan, they're going to buy soybeans from the United States.

But if China grows too quickly, then you're going to run in this problem of inflation. You're going to have too many Chinese trying to buy the same commodities everybody else is. I think this is one of the big questions, what will be the impact in energy markets? Chinese consumption of oil and gas has dropped during the pandemic. If it suddenly spikes, we have a shortage of supply, plus we have the whole issue of the Russian war with Ukraine and sanctions on the Russians. This could be something that drives prices up, and of course, that would then lead other countries to jack up interest rates to try to break the inflationary cycle. And so, this is something that while it may in the near term primarily affect China and the Chinese, it's going to have broader effects to the global economic system.

MCMAHON:
I think what's also interesting, Jim, is as this is all playing out, and we don't know where this is going, China seems to be on a bit of a diplomatic offensive in terms of it's just hosted the president of the Philippines, seemed to be a pretty cordial meeting, some agreements made. Xi has gone to Saudi Arabia, that was a big event. I just noticed an interesting op-ed in the Washington Post today from the outgoing Chinese ambassador of the U.S., incoming foreign minister, very upbeat and pointing to the ties and his eagerness to improve U.S.-Chinese ties. Those are all little anecdotes, but it's certainly a contrast to where you had this lockdown in the run-up to Xi's coronation as president for life or leader for life, and maybe China is making a concerted effort to show it's back in play, I guess, and I think the one thing for me that's a big break on that is just its unwillingness to openly share information about its surge because that's going to, I think, really antagonize a lot of countries.

LINDSAY:
It certainly well and the Chinese data on COVID has always been of dubious value. This is not a government that believes in transparency. It is a government that will manipulate information to serve its interests. I would emphasize the point you make, Bob, that in recent weeks the Chinese government has seemed to be going out of its way to reach out to other countries to try to emphasize the positive. You're right, it is a switch from what we saw in the run-up to Xi's metaphorical coronation. However, I don't think it means that Chinese behavior is actually going to change. It isn't changing in the Himalayas where they're squaring off against Indian forces and there's no evidence that it's changing at all when it comes to Taiwan. Indeed, I think Chinese coercion and gray area activities toward Taiwan are likely to continue to mount. 

We recently had an incident with a Chinese jet fighter coming very close to an American reconnaissance plane in a very dangerous way, which reminds us that we could find ourselves in a real crisis with Beijing very quickly because one of these flybys designed to sort of show might goes wrong. And they have gone wrong in the past, most famously back in 2001 when a Chinese jet fighter crashed into an American reconnaissance plane and then all of a sudden the agenda got scrambled for both the White House and for leadership in China. 

So, these are very dicey times, and again, the other thing we shouldn't lose sight of is that what is happening to the Chinese people with a surge of COVID is horrifying. Understood that the United States and China are geopolitical rivals and what have you, but as Americans know and Europeans know from when COVID ran wild back in 2020 to 2021, it is a horrifying disease and so many people can get sick and it overwhelms a hospital system, a healthcare system. We're seeing that happening in China and it's a terrible humanitarian experience.

MCMAHON:
And, I still think there's something to be gained there through some sort of vaccine diplomacy between the U.S. and China. I don't know the extent of which those discussions have had taken place, but it seems like there's a potential.

LINDSAY:
The Chinese government has been offered access to mRNA vaccines and they have refused to do so, and again, the odd thing is there is a Chinese vaccine, it's apparently less successful than Western vaccines, but the Chinese government hasn't made it mandatory as best we can tell. 

Bob, it's time for us to pivot and discuss our Audience Figure of the Week, which listeners can vote on every Tuesday and Wednesday at CFR_org's Instagram story. We are on the cutting edge, Bob. This week our audience selected, "Kim Jong Un Vows to Increase Nukes." Tell me more, Bob.

MCMAHON:
Well, this is just the New Year's message the world needed, Jim, from North Korea. Yes, Kim, who's also going to be marking a birthday in the coming days, so we should wait for further elaboration on this, but he continues to move in this very aggressive direction on the ramping up the country's defense, especially its ability to project its fire power abroad, not just defending, but actually sending ICBMs further and farther, increasing their payload and ramping up its nuclear program. There is no process underway at the moment for any sort of diplomacy to reign this in. It's reaction to rhetoric and to sort of ongoing messaging that takes place between the two countries that share the Korean peninsula, North and South Korea as well as the U.S. in particular, and Kim in his comments was especially resentful of what he saw as attempts to isolate his country and he saw it as this hostile action and he's only taking the prudent steps that any leader would take, in his words, to respond to that.

So, he's particularly concerned about U.S.-South Korean relations and any sort of deployment of U.S. nuclear strike assets in South Korea. The South Koreans have called for what President Yoon Suk-yeol calls practical training, solid mental readiness to ensure that any such provocations can be countered by the South. You've had Japan continuing to voice its concerns. Japan just announced a major ramp up in defense spending as well. Japan's also spoken out at the UN and the Security Council over North Korea's missiles as well.

So, I think one thing we'll need to see is whether or not the Security Council in any meaningful way can take up this issue. There had been a moment in the not too distant past where the countries, especially the five veto-wielding members, which includes Russia and China, were able to at least come up with statements of concern about North Korea's actions and rhetoric. They don't seem to be having any interest in that at all. In fact, there have been reports about North Korea helping Russia out militarily for example, and China doesn't seem to be interested in coming to the help of the U.S. or encountering North Korea in any way, and China still seems to be the country with most sway over North Korea. So, it all adds up to a disconcerting start to the new year, Jim.

LINDSAY:
It certainly is, Bob, and it is a problem that has no good solution for the Biden administration. This is an issue that the United States has been grappling with going back to the Bill Clinton administration, which if my math is right, started about three decades ago and we've had a succession of Democratic and Republican presidents who have not found a way to stop North Korea's nuclear weapons program, and the North Koreans continue to expand their weapons. They've gained or are about to gain the ability to hit the United States with nuclear weapons, and that's of great concern. Diplomacy hasn't worked, sanctions haven't worked, and it's clear the United States does not want to explore the military option, and the military option now would mean something quite different than if it had been exercised thirty years ago.

I think there is a great concern about whether we're going to have stability on the Korean peninsula. The North Koreans have amped up intrusions into South Korean airspace, which has greatly concerned the South Koreans. So, North Korea is sadly an issue to pay attention to in 2023 because things can go bad. Again, this is another place where you have a country acting provocatively and it may be doing so thinking it controls escalation, but you can have an accident, a mission goes wrong, and all of a sudden we start to go down an incredibly dangerous path at a very rapid pace.

MCMAHON:
It would be interesting to see the extent to which this regime is getting revenues or enough support to allow it to continue these developments because these require resources, in addition to know-how and they're under pretty severe sanctions, but it does appear to be the case that there's a great deal of leakage from China and Russia.

LINDSAY:
Yes, and these sanctions efforts-

MCMAHON:
Hacking efforts have brought in, but I'd be interested to see to what extent any of that sort of closing of the vice is productive in any way or not.

LINDSAY:
Well, it hasn't been so far, but again, the argument would be there's been so much leakage that the North Koreans can shift the cost from the regime to the people and that this is a regime. It doesn't care whether its people suffer and die, because again, the North Korean people have suffered through incredible repression, great famines and the rest because this is a regime that values its control over everything else.

MCMAHON:
And, that's our look at The World Next Week. Here's what else is going on. Russia and Ukraine mark the Orthodox Christmas. Benin holds parliamentary elections and the Consumer Electronics Show wraps up in Las Vegas.

LINDSAY:
Please subscribe to The World Next Week on Apple Podcast, Google Podcast, Spotify, or wherever you get your podcast, and leave us a review while you're at it. We appreciate the feedback. The materials mentioned in this episode, as well as a transcript of our conversation are listed on the podcast page for The World Next Week on cfr.org. Please note that opinions expressed in The World Next Week are solely those of the hosts or our guests, not of CFR, which takes no institutional positions on matters of policy. 

Today's program was produced by Ester Fang with Senior Podcast Producer Gabrielle Sierra. Special thanks to Michelle Kurrilla for her research assistance. Our theme music is provided by Miguel Herrera and licensed under Creative Commons. This is Jim Lindsay saying so long.

MCMAHON:
And, this is Bob McMahon saying goodbye and stay healthy out there.