Global Power Shifts: Trump’s Tariff Strategy, The Great Lure of China – For Tech Talent Returnees, and Arctic Diplomacy Explained – Plus more! #248
And pocket dopamine dealers: the smartphone’s dark bargain.
Grüezi!
US Tariff Trade War: Trump’s “calculated chaos” tariff strategy sends global markets tumbling and forces allies into defensive positions.
Finland’s Artful Arctic Strategy: How icebreaker technology became an unexpected diplomatic leverage point in Ukraine peace negotiations.
Silicon Valley Tech Exodus: Chinese engineers abandon American tech giants, accelerating China’s semiconductor and AI self-sufficiency.
Smartphone Crisis: New thinking about digital technology’s role in declining mental health, gambling addiction, and social fragmentation.
1️⃣ Trump’s Tariff Apocalypse
Taxation Without Explanation: America’s New Import Strategy
President Trump’s announcement of sweeping new tariffs represents the biggest shift in American trade policy in over a century – a baseline 10% tariff on all imports with punishing “reciprocal” duties targeting specific nations deemed to be trading unfairly with the US.
The scale is staggering: China faces a 34% tariff (climbing to 54% with earlier fentanyl-related duties), the European Union 20%, while nations from Japan (24%) to Vietnam (46%) confront barriers of historic proportions.
As financial markets gyrate and central bankers fret, it’s worth asking: what would genuine success look like for this strategy, and what hurdles must it overcome?
The Tao of Tariffs: Leverage or Levies?
For all the bombast surrounding the announcement, the tariffs’ long-term value lies primarily as negotiating leverage rather than permanent economic barriers. Early evidence from Southeast Asia offers a glimpse of this dynamic, with Vietnam and Thailand scrambling to the negotiating table after facing punitive rates of 46% and a whopping 37% respectively.
The administration now faces a critical test: can these responses be translated into a coherent framework for engagement with larger trading partners? History suggests that without clear objectives – specific market access demands with Europe, intellectual property protections with China, currency practices with Asian exporters – trading partners will struggle to respond constructively.
This is the difference between tariffs as theatre and tariffs as strategy. The first makes headlines; the second requires the kind of painstaking diplomatic groundwork that the Trump administration rejects.
Made in America: The Factory Fantasy?
Resurrecting American manufacturing requires more than simply raising the price of foreign goods. Companies contemplating the enormous capital investment of relocating production need confidence in policy continuity, and policy makers.
Nvidia’s recent announcement of expanded American manufacturing is an intriguing data point, but one swallow doesn’t make a summer. Genuine reshoring demands complementary policies addressing everything from workforce development to regulatory streamlining, energy costs to innovation incentives.
Retali-Nation: The Diplomatic Minefield
Perhaps the most delicate element of the tariff strategy involves managing international responses. Australia’s decision to forgo retaliatory measures offers a pathway of sorts, though one that larger economies with more complex trade relationships may find impossible to follow.
For China particularly, the calculus is fraught. Beijing must weigh economic pragmatism against nationalist imperatives, all while navigating internal pressures that Western commentators often under-appreciate.
The ideal scenario would see major trading partners choosing negotiation over escalation, but this requires the administration to offer credible off-ramps – specific actions that would lead to tariff reductions. So far, these pathways remain murky at best, raising the possibility of prolonged trade hostilities with no clear endgame.
The US Home Front: Prosperity or Austerity?
Even if international responses remain measured, the US domestic economy must demonstrate remarkable resilience to weather the inevitable adjustment costs:
higher consumer prices;
supply chain disruptions;
increased input costs for manufacturers;
potential job losses in import-dependent sectors.
The administration appears to be banking on current economic momentum to absorb these shocks, but this is a considerable gamble. If inflation heads up or consumer sentiments sour, the political calculus will shift dramatically.
Navigating Troubled Waters: The Obstacles
Beyond these immediate challenges are even tougher structural obstacles that no amount of policy determination can easily overcome.
Un-baking the Globalisation Cake
Modern manufacturing depends on intricate global supply networks developed over decades. Many products contain components from dozens of countries, optimised for cost, quality and efficiency in ways that defy simple realignment.
Complete reshoring proves impractical for most complex goods, while partial reshoring may offer limited benefits if critical components still require importation. The administration is seeks to unwind decades of globalisation through policy decree – a bit like trying to unbake a cake.
Automation Nation: Where Robots Reap What Policy Sows
Visit any modern plant, and what will struck you most is the absence of workers. Rows of robots perform most assembly tasks, supervised by a handful of well-educated technicians with advanced degrees.
This reality creates a profound mismatch between political expectations and economic outcomes.
Even successful reshoring generates fewer jobs than historically associated with manufacturing – a fact that sits uncomfortably alongside promises of industrial revival.
Rule-Based Disorder: Institutional Inertia and the Tariff Tsunami
The post-war trading architecture, despite its flaws, is still a formidable barrier to unilateral action. WTO dispute mechanisms will likely find the tariffs violate American commitments, while existing trade agreements contain specific provisions limiting such measures.
Although the US can temporarily override these constraints through emergency powers, sustained success would require either reforming these institutions or establishing alternative frameworks – both monumental undertakings.
Fiscal Physics: The Economic Laws Nobody Overturns
Several fundamental economic factors create additional problems:
Services now dominate the American economy, with manufacturing accounting for only 11% of GDP;
Near-full employment makes large-scale industrial expansion hard without wage inflation;
Federal Reserve tightening in response to tariff-driven inflation could offset any growth benefits;
Limited fiscal space prevents the complementary investments needed for industrial policy success.
Even flawlessly executed, the tariff strategy faces natural limits to what it can achieve.
Pyrrhic Protectionism: Defining Success Downwards
Given all these requirements and obstacles, realistic success looks very different from the administration’s rhetoric:
Using tariffs to secure negotiated agreements addressing specific unfair practices while preserving most trade flows;
Targeted reshoring of strategically critical industries with substantial government support;
Gradual reconfiguration of supply chains to reduce dependency on geopolitical rivals;
Eventual replacement of broad tariffs with more focused measures addressing specific unfair practices.
This limited success would require exceptional diplomatic skill, strategic patience, and sustained political will against inevitable pressure. It would also mean acknowledging that a complete manufacturing renaissance remains unrealistic, focusing instead on specific strategic priorities.
For an administration that managed to include an island inhabited only by penguins in its tariff target list, you can add incompetence to shattered credibility. All that remains is force. Let’s see how far that takes us…
2️⃣ Behind The Fire And Fury
What might happen after an Iran strike
The USS Carl Vinson heads to the Gulf. B-2 bombers in the Indian Ocean. Patriot batteries relocating from Korea to the Middle East. All this hardware suggests something beyond Houthi intimidation.
A showdown with Iran appears increasingly likely. President Trump alternates between threats and offering talks – predictably rejected by a Tehran leadership wary after his withdrawal from the 2015 nuclear agreement.
With Iran reportedly weeks from nuclear weapon capability, military action grows more probable. If missiles target Tehran, what follows?
Energy Markets
Oil prices (~$70/barrel) would likely surge to $100-150 within days, depending on:
Damage to Iran's 3.5 million barrels daily production
Strait of Hormuz status (21 million barrels daily transit)
Scale of retaliatory strikes on regional infrastructure
Strategic petroleum reserves would offer limited relief during extended disruption.
Economic Impact
Central banks would face an impossible choice between fighting inflation, supporting growth, or stabilising markets.
Nations with high energy dependency and weak finances – Pakistan, Egypt, Turkey, and parts of Africa – risk serious economic crises. Egypt spends nearly 8% of GDP on energy subsidies, while Pakistan's economy remains precarious.
Regional Dynamics
Saudi Arabia would likely:
Condemn military action while advocating for Iranian sovereignty
Criticise Israel to manage domestic sentiment
Position itself as mediator between Iran and America
Ironically, an Israeli strike might accelerate Saudi-Iranian rapprochement, as both increasingly view each other as potential partners rather than threats.
Iranian Response
Despite domestic discontent, military strikes would likely strengthen the Iranian regime’s control. Historically, the leadership has increased repression during external threats, as during the 1980-88 Iran-Iraq War.
Attacks would trigger harsher crackdowns while uniting even moderate factions around national sovereignty.
More concerning, Iran might abandon its public stance against nuclear weapons development, speeding up efforts as its only credible security guarantee.
US Strategic Dilemma
A US-Israeli campaign could damage Iran’s nuclear capabilities, but would require sustained military commitment risking broader regional conflict.
This engagement would also divert critical resources from other priorities, particularly countering China’s ambitions in Asia, potentially creating vulnerability gaps elsewhere.
TL;DR?
An attack on Iran would trigger cascading consequences reshaping regional security architecture, energy markets, and great power competition for years.
Everyone knows how conflicts begin. No one knows how they end.
3️⃣ Finn’s Ain’t Who They Used To Be
Geopolitics: Icebreakers ships as Boaty McBargaining Chips
Finnish President Alex Stubb’s unexpected Mar-a-Lago golf appearance last weekend was more than putting and pleasantries.
Stubb’s seven-hour diplomacy mission proposed a 20 April ceasefire deadline for Ukraine – selected for both Easter symbolism and marking Trump’s first 90 days.
But how did the leader of a country of 5.5 million get this concession?
Icebreakers: Currency of Arctic Influence
Finland’s dominance in icebreaker technology – designing 80% and building 60% of the global fleet – makes it hard to avoid in Arctic security. America’s meagre two working icebreakers versus Russia’s 40+ fleet is an immediate strategic vulnerability that even Trump has to acknowledge.
You need friends with the right kit.
This transforms Finland from peripheral European actor to strategic American partner. Stubb has smartly positioned his nation as the crucial technological enabler for America’s Arctic ambitions. Not bad for a country better known for saunas and brick phones.
The Ukraine-Arctic Nexus
Stubb’s move exploits Trump’s desire for a headline on Ukraine, using Finnish icebreaker expertise as a geopolitical bartering tool. When asked about Putin’s trustworthiness, Stubb’s unequivocal “no” represents refreshing diplomatic clarity in an era where many leaders would have offered a 500-word equivocation.
Most interesting? Stubb’s previewing of Senator Graham developing a “strong sanctions mechanism” with approximately 50 senators. Its appearance Tuesday suggests that the US Senate is not yet entirely a legislative hospice.
Europe’s Cracks in the Ice
Stubb’s reference to a Starmer-Macron-Merz “coalition of the willing” hints at European contingency planning that go further than public acknowledgments.
However, Estonian security expert Rainer Saks cuts to the heart of the matter:
“The problem starts with Europe itself. Europe hasn’t agreed on how, in what way and to what extent anyone should represent it on this issue. What we’re seeing is that Europe has split into coalitions of the willing. And it’s impossible to say whether France or the United Kingdom is leading a single coalition. They claim to lead jointly. That’s Europe’s weakness.”
This fragmentation explains why Stubb’s diplomatic sequencing – meeting Zelensky before Trump and Starmer afterwards – establishes Finland not as America’s supplicant but as a strategic mediator in this European leadership vacuum.
Risk Calculation in the New Arctic Game
Trump’s Arctic acquisitiveness also carries alliance risks. His pursuit of Greenland and criticisms of Denmark reflect an American president perpetually confusing geopolitics with property deals.
Stubb’s assessment that “Trump’s patience is running out” with Russia and that “Russia only understands force” signals a more hawkish Finnish position too.
The emerging picture?
Finland as an essential American ally in Arctic geopolitics;
Trump as the decisive broker in Ukraine;
European nations still uncoordinated while hedging against America’s Arctic unpredictability;
A European leadership vacuum hampers unified response.
Whether Stubb’s gambit succeeds remains uncertain, but his transformation of Finland from observer to critical player – simultaneously serving as Russia expert, Arctic security provider, and transatlantic bridge-builder – represents diplomatic acumen of the highest order. Not bad for a country smaller than many Chinese provinces.
4️⃣ Should We Fear China?
The gap between rhetoric and reef-building.
Another day, another Taiwan strait exercise. Whilst some tremble at the prospect of a rising China, retired Chinese colonel Zhou Bo offers an appealing insider’s perspective on China’s global ambitions and strategic thinking in Should the World Fear China?
As Cold War ice crystals form, Zhou calls for calm.
The Identity Paradox
Zhou begins by acknowledging a contradiction. China is “the largest trading nation; the largest exporter; the largest industrial nation” but calls itself a “developing country.” The paradox helps explain why China appears so differently depending on where you stand:
To Americans, it’s a “strategic competitor” and “pacing threat.”
Europeans see a baffling mix of “partner for cooperation, economic competitor and systemic rival.”
In the Global South, China is a “natural member” with a “far more positive image.”
One country, different interpretations.
Restyling the international order, or just taking a bit off the fringe?
China, says Zhou, doesn’t want to “reshape the international order.” But he also dismisses the “liberal international order” as “a Eurocentric view with an apparent air of Western triumphalism.”
Instead, he says the world is “far more complicated” than “Western” economic institutions like the IMF and World Bank. A genuine international order must include “different but coexisting religions, cultures, customs, national identities and social systems and above all, civilisations.” Unclashing ones.
Far from being a “revisionist power,” Zhou sees China as globalisation’s greatest beneficiary. Why would China undermine a system from which it has profited so handsomely? “It is in China’s own interests to become further integrated with the rest of the world,” he insists.
“He started it.”
Zhou’s perspective frames Chinese actions as responses rather than provocations. Throughout, he portrays China’s military and diplomatic moves as reactions to perceived US aggression or containment strategies.
Zhou notes that “American military aircraft regularly conduct close surveillance and reconnaissance in China’s exclusive economic zones” and “US naval vessels sail through waters off the islands and rocks in the South China Sea over which China claims sovereignty.” These activities, in his view, constitute “American provocations” that China must check.
Similarly, China’s military exercises around Taiwan are not aggressive posturing but “robust responses” to “provocations from either Taipei or Washington.”
This framing pervades Zhou’s analysis – suggesting China acts defensively while the US and its allies are the true disruptors of regional stability.
Critics might see it as self-serving, but it highlights how different starting assumptions can lead to dramatically different interpretations of the same events.
One country’s “freedom of navigation exercise” is another’s “hostile incursion.”
Moving Beyond Victimhood
Zhou offers some candid advice for his own country. China must “overcome its lingering victimhood” regarding the “century of humiliation” that began with the Opium War in 1840.
This victimhood narrative should have ended with the founding of the People’s Republic in 1949, when Chairman Mao declared “the Chinese people have stood up.” Today’s China is “the envy of the world” and must “leave its past behind and embrace its strength.”
His warning is pointed:
“Victimhood is not the foundation for patriotism. It leads to nationalism, populism, and isolationism.”
Wise words for a world where grievance has become the currency of politics.
Zhou outlines the military principles he hopes China will maintain:
“Caution in use of force” that has enabled China’s remarkably peaceful rise
Defence spending below 2% of GDP, showing “self-control and self-confidence”
Not seeking “spheres of influence” that are “costly and difficult to maintain”
Avoiding military alliances
Adhering to “no-first-use of nuclear weapons”
He highlights China’s restraint during incidents like the 2020 Galwan Valley clash with India, where despite casualties, “neither side attempted to shoot at the other.”
The Credibility Gap
Zhou presents China as a responsible stakeholder seeking reform rather than revolution in the international system. His narrative aims to reassure while defending China’s core interests. Yet his analysis leaves several questions unanswered.
How does China’s increasingly “assertive” behaviour in the South China Sea square with his emphasis on restraint?
Does the scale of military modernisation truly reflect the modest 2% defence spending he cites?
How does China’s ambitious Belt and Road Initiative avoid creating de facto spheres of influence?
The opacity of China’s leadership makes it difficult to predict whether Zhou’s moderate, common sense vision will guide policy when future crises emerge.
This underscores the fundamental challenge in international relations: the gap between how nations present themselves and how they behave under pressure.
Zhou’s perspective is valuable as an insider view, but it’s actions rather than words that will ultimately determine how nervous the world feels.
5️⃣ The Great Lure of China
How the US lost the silicon race it didn’t know it was running
Chinese engineers are abandoning Silicon Valley for positions back home. The latest departure: Kong Long, who spent seven years developing wireless semiconductors for iPhones and wearables before joining Shanghai’s Fudan University last month.
Kong’s move follows fellow Apple chip engineer Wang Huanyu, who left in December after three years developing the M3 and M4 chips powering today’s Macs. Both represent China’s strategic push to reclaim its overseas tech talent amid tightening US export controls.
This exodus extends beyond semiconductors. Notable returnees include Google DeepMind VP Wu Yonghui, University of Texas professor Dr Sun Nan (whose “Patriotic Chip Project” has developed 50+ cutting-edge chips), and AI drug discovery expert Dr Fu Tianfan. Returning professors generous packages:
Research budgets of $1.25 million (effectively $2.5 million with China's purchasing power)
Annual salaries around $104,000 (equivalent to $208,000 adjusted for cost of living)
Additional subsidies that can push total compensation to six times the average professor’s salary
Two forces are driving this shift:
America’s increasingly unwelcoming environment;
China’s growing appeal.
A survey of 1,300 US scientists of Chinese descent found 67% feared government investigations, while 61% had considered leaving America altogether.
Meanwhile, China has transformed its research landscape, creating what returnees call “unprecedented opportunities” while dismantling bureaucratic barriers to attract foreign-educated talent.
China now produces nearly half the world’s top AI talent (47% versus America’s 18%), and recently overtook the US in total “world-leading scientists” with 32,511 compared to America’s 31,781.
For America, the implications are concerning. Chinese researchers have been the largest source of foreign science PhDs, with 87% historically staying after graduation. As the Brookings Institution noted, America’s position as an AI leader is “far less secure than many assume.”
For China, the influx represents rocket fuel for its technological ambitions, potentially accelerating its timeline for achieving self-reliance in critical technologies – precisely the outcome US export controls aimed to prevent.
The silicon bridge across the Pacific increasingly looks like a one-way street heading east. And in that direction may lie the future of technological leadership.
6️⃣ “Smartphone Theory of Everything’
Arpit Gupta’s explanation for why everything is awful
There’s something compelling about Arpit Gupta’s STOE (although there’s a touch of the Jonathan Haidts).
The timing is suspicious – these negative social trends accelerated after smartphone adoption started spiking around 2012-2014.
But rather than a simple “smartphones cause everything” theory, I think what we’re seeing is more precise: smartphones systematically amplify existing human vulnerabilities at unprecedented scale.
The evidence varies pretty significantly across these claims. Research linking smartphones to mental health issues (especially in young women) is actually quite strong.
A 2024 longitudinal study from South Korea demonstrated causation, not just correlation – increased screen time led to rising depression in girls. Meta-analyses show similar patterns across countries. Our pocket companions, it seems, aren’t just destroying attention spans, but mental health too.
Similarly, the online gambling data is alarming. Studies show online gamblers have 3-8x higher rates of addiction than offline gamblers, with young men particularly vulnerable.
The UK saw online gambling jump from 17% to 24% in just five years as mobile betting apps proliferated. Turns out, putting a casino in every pocket wasn’t the brilliant social innovation we thought it might be.
What makes smartphones uniquely powerful isn’t that they’re the sole cause of these trends, but how they function: they remove all friction between impulse and action.
Want to check social media? It’s instantly available.
Feel like placing a bet? Two taps away.
Need to compare yourself to impossibly perfect strangers? Scroll away.
The most accurate framework isn’t technological determinism but attention economics.
We’ve created an unprecedented marketplace where human attention is harvested with scientific precision. Every notification, autoplay feature, and recommendation algorithm is engineered to exploit cognitive vulnerabilities. Our phones have become less tools for our use than portals through which we ourselves are used.
So while Gupta is onto something important, the “Smartphone theory of everything” might be better refined as “the systematic exploitation of human psychological vulnerabilities at unprecedented scale and precision.” Less catchy, but perhaps more accurate. Like most theories of everything, it explains much but not all.
The question isn’t whether smartphones impact these trends – the evidence is clear they do – but how we build technology that aligns with human strengths rather than exploiting our weaknesses.
That’s the conversation we need to be having, preferably not while staring at our phones.
7️⃣ My Favourite April Fool
Probably tells you something bad about my sense of humour.
Thanks for reading!
Best,
Adrian
