WEBVTT - A New Cold War? Ian Bremmer Talks to Armstrong & Getty 0:00:00.520 --> 0:00:02.640 Well, I think one of the things that coronavirus has done, 0:00:02.720 --> 0:00:05.880 just like bar the fact that our globalized economy is 0:00:05.920 --> 0:00:08.680 an economy that really works for China first and foremost, 0:00:08.760 --> 0:00:11.880 and not for the United States, certainly not for American workers. 0:00:11.920 --> 0:00:14.280 Are supply chains where are they now in China? Our 0:00:14.320 --> 0:00:18.000 medical devices where they made China? Are pharmaceuticals where they 0:00:18.040 --> 0:00:20.200 made China? Are big tech companies who do they want 0:00:20.239 --> 0:00:22.959 to do business with China? I think it's time that 0:00:23.040 --> 0:00:26.279 we asked ourselves what kind of an economy have we 0:00:26.360 --> 0:00:29.280 allowed to be created and what is it doing for 0:00:29.320 --> 0:00:33.680 American workers? We need some structural reform at Senator Josh Holly, 0:00:33.840 --> 0:00:36.120 This might be the biggest thing that comes out of 0:00:36.200 --> 0:00:39.440 the coronavirus. On the other end is a different relationship 0:00:39.520 --> 0:00:41.760 with China. We've been kind of ignoring the fact that 0:00:41.800 --> 0:00:44.720 we use, we allow slave labor to bring us cheap 0:00:44.760 --> 0:00:47.239 socks and that sort of thing for years. But so 0:00:47.320 --> 0:00:49.840 let's talk about that with Ian Bremer, President and founder 0:00:49.840 --> 0:00:53.319 of Eurasia Group. It's always a pleasure Ian, how are you, sir? 0:00:54.320 --> 0:00:56.160 Very well? But you know, I mean the Chinese are 0:00:56.200 --> 0:00:58.680 too expensive to make our socks right now. That's largely 0:00:58.720 --> 0:01:04.600 Bangladesh excellent so but cheap consumer goods electronics in particular. 0:01:04.880 --> 0:01:07.080 To fixate on socks at this moment I think would 0:01:07.120 --> 0:01:11.080 be a mistake. The bigger pictures give you that. I mean, 0:01:11.120 --> 0:01:14.280 why are you focusing on thought that was a for 0:01:14.319 --> 0:01:16.400 instance and maybe it was a bad for instance in 0:01:16.440 --> 0:01:21.640 generally and that so, hey, do you think this is 0:01:21.680 --> 0:01:23.679 going to be an inflection point, as the kids say, 0:01:23.840 --> 0:01:26.520 and and how big a one in terms of the 0:01:26.600 --> 0:01:29.959 world and specifically the US is willingness to be in 0:01:30.080 --> 0:01:34.880 bed economically with China? I do, because especially most people 0:01:34.880 --> 0:01:37.160 are quarantining right now, which means they're not wearing shoes, 0:01:37.160 --> 0:01:40.959 they're walking around their house in suck. So we're gonna 0:01:41.000 --> 0:01:44.360 need We're gonna need a lot more. It's becoming a 0:01:44.480 --> 0:01:46.960 nationally strategic important asset. And if all of them are 0:01:47.000 --> 0:01:49.880 coming from China, clearly we're gonna need to stop that. 0:01:49.880 --> 0:01:51.440 We're gonna need to bring that production back to the 0:01:51.560 --> 0:01:54.240 Unit States. Most of us didn't realize that so many 0:01:54.240 --> 0:01:56.480 of our drugs remain in China, and then and then 0:01:56.520 --> 0:01:58.400 the fact that they can lie to us and unleasha 0:01:58.600 --> 0:02:00.480 virus like this on us, and all this stuff it's 0:02:00.520 --> 0:02:02.960 just it seems to have changed our view. Is that 0:02:03.280 --> 0:02:06.720 you think that's correct? Well, the fact is, guys, we 0:02:06.800 --> 0:02:11.360 have a just in time supply chain. It is incredibly efficient, 0:02:11.800 --> 0:02:14.280 It leads to a lot of growth, and we've all 0:02:14.280 --> 0:02:16.600 our companies have made a lot of money, shareholders have 0:02:16.639 --> 0:02:18.679 made a lot of money. What we don't have is 0:02:18.680 --> 0:02:22.160 it just in case supply chain. If anything breaks, if 0:02:22.200 --> 0:02:24.560 you suddenly have a major disruption, we're in a lot 0:02:24.560 --> 0:02:28.600 of trouble. And a lot of that supply chain comes 0:02:28.639 --> 0:02:35.800 out of China, whether it is electronics or major consumer durables, 0:02:36.000 --> 0:02:39.560 or our medical supply chain, our health care, so much 0:02:39.600 --> 0:02:41.839 of that is reliance on China. They don't have rule 0:02:41.880 --> 0:02:45.720 of law. Um, they don't have an independent judiciary. Uh. 0:02:45.760 --> 0:02:49.600 Their state has much more influence over their economy than 0:02:49.680 --> 0:02:52.520 the private sector companies do. So it's hardly a free market. 0:02:52.520 --> 0:02:56.400 It's state capitalists and uh and and our relationship with 0:02:56.440 --> 0:02:58.520 them right now is not good and it's probably going 0:02:58.560 --> 0:03:01.320 to get a lot worse. So, I mean, given all 0:03:01.400 --> 0:03:05.720 of that, it's pretty clear that we're gonna need to 0:03:05.760 --> 0:03:08.680 think very differently about our supply chain, and we're gonna 0:03:08.680 --> 0:03:11.520 bring a lot more manufacturing closer to where we actually 0:03:11.560 --> 0:03:15.200 consume those goods. But keep in mind that labor also 0:03:15.360 --> 0:03:18.960 is less important to capital. We don't need. Not only 0:03:19.000 --> 0:03:22.400 has Chinese labor gotten a lot more expensive, um, but 0:03:22.520 --> 0:03:26.480 also with robotics and automation and big data and deep 0:03:26.600 --> 0:03:30.040 learning and and uh you know, and and and and 0:03:30.240 --> 0:03:34.280 new types of manufacturing processes, you just don't need anywhere 0:03:34.320 --> 0:03:37.840 near the amount of labor to produce this stuff. So 0:03:37.880 --> 0:03:40.600 a lot of operations had been thinking about changing their 0:03:40.600 --> 0:03:43.600 supply chain for a long time, and they didn't because 0:03:43.600 --> 0:03:45.840 they were making so much money. The CEOs didn't last 0:03:45.960 --> 0:03:48.200 very long. It's like, let's have somebody else do that. 0:03:48.560 --> 0:03:50.800 Now that's going to happen. So the point that you 0:03:50.880 --> 0:03:54.320 made before we talked about socks is that the most important, 0:03:54.400 --> 0:03:56.520 the most important thing coming out of this crisis, that 0:03:56.560 --> 0:03:58.760 we're gonna have a very different relationship with China. I 0:03:58.800 --> 0:04:01.520 think is absolutely case. The questions do we go so 0:04:01.600 --> 0:04:04.360 far that it becomes a cold war? Um? And I 0:04:04.400 --> 0:04:07.280 think it's plausible. And we also have to recognize China 0:04:07.320 --> 0:04:09.280 is a lot more powerful today than they worked during 0:04:09.280 --> 0:04:13.000 the SARS crisis or during two thousand eight, And there 0:04:13.000 --> 0:04:15.000 are a lot of countries around the world right now 0:04:15.400 --> 0:04:19.160 that see the way that Chinese have responded to this 0:04:19.279 --> 0:04:23.120 coronavirus crisis or the China virus as Trump is saying, 0:04:23.600 --> 0:04:26.480 and how they're willing to provide a lot of humanitarian 0:04:26.560 --> 0:04:29.000 aid to the Europeans in the Middle Easterns and others. 0:04:29.720 --> 0:04:32.120 There's gonna be a lot more hedging of American allies 0:04:32.200 --> 0:04:36.239 towards Beijing and away from Washington. And that matters too. Really, 0:04:36.360 --> 0:04:41.719 that's an interesting twist. Did not see that? I mean, 0:04:41.760 --> 0:04:44.640 think about after nine eleven when Alwa lead from Saudi 0:04:44.680 --> 0:04:48.880 Arabia and the Saudia is approximately responsible for all of that. 0:04:48.880 --> 0:04:51.360 That's where most of the bombers came from, offered money 0:04:51.440 --> 0:04:54.280 to the New York to New York, so then Mayor 0:04:54.279 --> 0:04:57.559 Giuliani told him to go scratch. When Jack Ma comes 0:04:57.600 --> 0:05:00.800 to the United States and offers us five hundred thousand 0:05:00.800 --> 0:05:05.279 masks and test kits that we can't produce ourselves right now, 0:05:05.760 --> 0:05:08.120 first of all, it hurts your heart, But second of all, 0:05:08.160 --> 0:05:12.960 it tells you just how how different this global environment is. 0:05:13.240 --> 0:05:15.320 And we need to get our heads out of our 0:05:15.360 --> 0:05:18.320 asses a bit. We need to stop with the American exceptionalism. 0:05:18.320 --> 0:05:20.599 We have the best of everything, including health care. We don't, 0:05:21.040 --> 0:05:23.240 and we're gonna have to actually start making sure that 0:05:23.279 --> 0:05:26.440 we do again. So A and Bremer, president founder of 0:05:26.560 --> 0:05:29.440 Eurasia Group, is on the line. I watched the video. 0:05:29.440 --> 0:05:32.000 I'm sure you have two of the spokesperson for the 0:05:32.080 --> 0:05:36.400 Chinese Bureau of Foreign Affairs in essence saying there will 0:05:36.480 --> 0:05:39.640 be no decoupling. This is foolish, that you need to 0:05:39.640 --> 0:05:43.799 stop slandering China, etcetera. How how concerned are the Chinese 0:05:43.920 --> 0:05:48.280 about how this whole uh you know, the era has 0:05:48.400 --> 0:05:53.480 has hurt their reputation. Um. I think they're much less 0:05:53.480 --> 0:05:56.760 worried about how it's hurt their reputation. UM. You know, 0:05:56.960 --> 0:06:00.400 I remember during the earthquake in Indonesia, the big one 0:06:00.400 --> 0:06:04.000 and the tsunami that came afterwards, wiping out all of 0:06:04.040 --> 0:06:07.440 those towns. The Americans were boots on the ground in 0:06:07.440 --> 0:06:13.040 Indonesia almost immediately, and I mean the massive grassroots support 0:06:13.120 --> 0:06:15.480 for the United States that came out of that was extraordinary. 0:06:15.480 --> 0:06:17.919 And the Japanese put a lot of money in real fast, 0:06:18.000 --> 0:06:20.520 the government down the private sector, and the Chinese were 0:06:20.600 --> 0:06:22.760 late and did almost nothing. I think they offered two 0:06:22.880 --> 0:06:25.000 or four million dollars, like a couple of weeks after 0:06:25.040 --> 0:06:28.360 the fact, and and it really I mean they were like, well, 0:06:28.440 --> 0:06:31.400 we're poor, we can't do anything. But it really undermined 0:06:32.160 --> 0:06:35.880 China as this you know, have all this economic influence, 0:06:35.960 --> 0:06:40.800 all this trade, but really not not a properly functioning government. 0:06:41.240 --> 0:06:44.040 This is a very different place. And so even though 0:06:44.080 --> 0:06:49.359 the Chinese did cover up um this coronavirus, and while 0:06:49.400 --> 0:06:53.599 they were covering it up, allowed over a million people 0:06:53.680 --> 0:06:57.760 from Uhan to travel outside to China and other countries. 0:06:57.760 --> 0:07:02.200 And that's why we suddenly this massive expansion, this explosion 0:07:02.240 --> 0:07:06.159 of cases, not just across China, but also in Washington State, 0:07:06.240 --> 0:07:08.680 in Iran and Italy. I mean, where did this come from. 0:07:08.720 --> 0:07:13.440 It came from Wuhan. UM. But since then they cracked 0:07:13.440 --> 0:07:17.640 down very severely. They've gotten out of the depths of 0:07:17.680 --> 0:07:22.480 this um uh epidemiological crisis, even though their economy is 0:07:22.520 --> 0:07:26.600 still very slow, very quickly. While the Europeans are the 0:07:26.600 --> 0:07:30.360 epidemiological center of this breakout in the Americans are only 0:07:30.400 --> 0:07:34.160 a couple of weeks behind um and the Chinese, who 0:07:34.280 --> 0:07:38.440 produced the vast majority of the world's medical supplies and 0:07:38.520 --> 0:07:41.680 also have an awful lot of medical personnel are now 0:07:42.480 --> 0:07:45.240 using that both in terms of selling it but also 0:07:45.400 --> 0:07:48.360 providing it um for and there will be a bill 0:07:48.440 --> 0:07:51.480 to be paid long term um to all these countries 0:07:51.520 --> 0:07:54.440 around the world. It's it's very clear the Chinese feel 0:07:54.440 --> 0:07:57.000 in a much stronger place. Where after the two thousand 0:07:57.000 --> 0:08:00.440 and eight financial crisis, it was the Americans that we're 0:08:00.680 --> 0:08:03.000 leading the charge. In the G twenty, we were the 0:08:03.000 --> 0:08:07.040 ones doing the big stimulus, both for Wall Street and 0:08:07.120 --> 0:08:10.040 for Detroit. We were the ones coordinating with other central 0:08:10.040 --> 0:08:13.160 bank governors around the world. There's been no such coordination 0:08:13.240 --> 0:08:16.000 this time around, and there doesn't seem to be any planned. 0:08:16.520 --> 0:08:18.960 New York Times had this video they put together of 0:08:19.320 --> 0:08:23.640 China's propaganda effort, both domestically there in China and for 0:08:23.800 --> 0:08:26.120 the world. That was pretty impressive that I was looking 0:08:26.160 --> 0:08:28.240 at something that they have these TV shows that look 0:08:28.320 --> 0:08:31.560 like Ellen and Oprah, and they're spouting all this crap 0:08:31.600 --> 0:08:33.560 about what a great job they did of handling it, 0:08:33.600 --> 0:08:35.600 and isn't g amazing and all this sort of stuff. 0:08:35.640 --> 0:08:38.640 They're really good at that sort of thing, aren't they. Yeah, 0:08:38.679 --> 0:08:40.480 they really are. We used to be really good at 0:08:40.520 --> 0:08:43.680 We had radio for Europe UM, and uh, you know, 0:08:43.760 --> 0:08:48.600 we would really propound American values and it wasn't hard 0:08:48.640 --> 0:08:51.319 to do because the United States was doing so well 0:08:51.880 --> 0:08:55.760 and leading by example in so many ways. Um that 0:08:55.840 --> 0:08:58.800 now today I would argue that the Chinese a lot 0:08:58.800 --> 0:09:01.520 of it is propaganda, as the treatment of the average 0:09:01.600 --> 0:09:04.640 Chinese citizen, of course, is nothing that anyone in the 0:09:04.720 --> 0:09:08.079 United States or Europe or Canada would tolerate. But their 0:09:08.160 --> 0:09:12.080 propaganda has gotten certainly, they're putting a lot more money 0:09:12.080 --> 0:09:14.640 into it. The production values are very high, and they 0:09:14.679 --> 0:09:17.720 also increasingly have some messages that they can actually sell 0:09:18.120 --> 0:09:21.680 that that that resonates with others around the world. So 0:09:21.760 --> 0:09:25.280 I mean, coming out of this crisis, the Chinese model 0:09:25.320 --> 0:09:28.000 is going to look a lot more robust and no 0:09:28.040 --> 0:09:30.400 one will be able to say it's the US leado 0:09:30.720 --> 0:09:35.520 order anymore. I mean that that that will be formally gone. Interesting. 0:09:35.559 --> 0:09:38.640 Ian Bremmer, President and founder of Eurasia Group, always enjoy 0:09:38.720 --> 0:09:41.120 the Chattian. Thanks for a carveness out a couple of minutes. 0:09:41.160 --> 0:09:44.240 Let's talk again soon. Good talking, guys. Thanks. You know, 0:09:44.800 --> 0:09:47.400 the the the I'm up with America part of me, 0:09:47.480 --> 0:09:49.760 which is a lot of me, It's like most of me, 0:09:49.800 --> 0:09:53.000 it's practically all of me. Really hates hearing people saying that. 0:09:53.040 --> 0:09:57.280 In my my reaction is always some people saying that 0:09:57.360 --> 0:09:59.840 sort of stuff. But if but if China makes most 0:10:00.040 --> 0:10:04.800 the world's medical supplies, for instance, that means most of 0:10:04.840 --> 0:10:06.959 the world is on the hook to the Chinese, that 0:10:07.120 --> 0:10:09.719 means something right and they and they're they're the one 0:10:09.760 --> 0:10:12.160 that get to yank the leash this way or that, 0:10:12.280 --> 0:10:15.280 not us right the way it was for a very 0:10:15.320 --> 0:10:19.480 long time with practically everything. Yeah, yeah, well, listen, there 0:10:19.480 --> 0:10:22.439 are a couple of kinds of patriotism. There's the raw 0:10:22.559 --> 0:10:26.360 raw all the time, dance and Uncle Sam outfit type 0:10:26.400 --> 0:10:28.880 of patriotism, which is fine. It's it has its role. 0:10:28.960 --> 0:10:32.440 But you know, I just I tend and people who 0:10:32.720 --> 0:10:35.440 I talked to about the country tend to have more 0:10:35.480 --> 0:10:39.240 of a I don't know, I maybe a good example 0:10:39.400 --> 0:10:42.240 be like Bill Belichick, the head coach of the Patriots. 0:10:42.920 --> 0:10:47.200 He loves the Patriots and the Patriots organization. Therefore, he 0:10:47.280 --> 0:10:50.880 has utterly clear eyed about what it does well, what 0:10:51.000 --> 0:10:53.520 it needs to work on, and what it's doing poorly. 0:10:54.040 --> 0:10:59.200 And he's utterly clear headed about the Patriots opponents and 0:10:59.240 --> 0:11:02.080 what they're going well, and how we need to counter them. 0:11:02.280 --> 0:11:04.160 And and a lot of other countries are in our 0:11:04.200 --> 0:11:07.200 opponents at all, not in a significant way. China is 0:11:07.320 --> 0:11:11.680 an opponent absolutely, And so to say, wow, we've really 0:11:11.679 --> 0:11:15.600 become dependent on China and we've lost our manufacturing capacity 0:11:15.600 --> 0:11:19.000 and something like pharmaceuticals, which is critical to national security. 0:11:19.280 --> 0:11:21.840 That's that's not a lack of patriotism, man, that's being honest. 0:11:21.920 --> 0:11:23.760 It reminds me to keep the sports thing going of 0:11:23.800 --> 0:11:25.920 when you've got like a team you're rooting for is 0:11:25.960 --> 0:11:28.079 really good, and hey, and we might as well keep 0:11:28.080 --> 0:11:30.080 on this metaphor because there ain't any real sports, right. 0:11:30.400 --> 0:11:32.040 Go ahead. When a team is you know, like a 0:11:32.120 --> 0:11:34.080 championship team or whatever, it happens with them all the 0:11:34.120 --> 0:11:35.640 time and they kind of get in their head that 0:11:35.640 --> 0:11:38.360 they're gonna win just because of your jersey, just because 0:11:38.400 --> 0:11:40.920 the name on the jersey. You Yeah, we automatic we're 0:11:40.920 --> 0:11:44.080 better than everybody else. Right, Well, sometimes you get exposed 0:11:44.120 --> 0:11:47.080 as for having some problems. The good thing is sometimes 0:11:47.080 --> 0:11:49.040 it's just you just need to be reminded because you 0:11:49.080 --> 0:11:53.559 actually are better than everybody else. Yes we are that 0:11:53.720 --> 0:11:57.520 we are actually the championship team. Just not playing like 0:11:57.559 --> 0:12:01.240 it for a while, right, Not perfect, absolutely a great 0:12:01.280 --> 0:12:03.520 deal to be proud of. And our system is better 0:12:03.559 --> 0:12:06.280 than their system, right, oh yeah, and we just have 0:12:06.360 --> 0:12:08.800 to make sure it stays that way. And so, you know, 0:12:08.840 --> 0:12:13.320 it's a realistic person understands both are true. We are 0:12:13.400 --> 0:12:15.480 the greatest country on earth with the greatest system and 0:12:15.520 --> 0:12:18.200 the greatest constitution and the rest of it, and we 0:12:18.240 --> 0:12:20.280 have stuff we need to work on. Don't believe the 0:12:20.320 --> 0:12:23.040 crap coming out of the universities that America is the 0:12:23.040 --> 0:12:25.959 most racist country on earth and that's based on slavery, 0:12:25.960 --> 0:12:29.280 and know, please, that's garbage. But you know, be a realist. 0:12:29.320 --> 0:12:31.959 So I've been complaining about you prepper weirdos. Somebody pointed out, 0:12:32.080 --> 0:12:34.000 I've got my anger pointing in the wrong direction.