WEBVTT - Columbia's Stiglitz Doubts Direction of Fed Policy 0:00:00.600 --> 0:00:10.719 Bloomberg Audio Studios, Podcasts, radio news. This is Bloomberg Business 0:00:10.720 --> 0:00:13.960 Wait inside from the reporters and editors who bring you 0:00:14.000 --> 0:00:18.360 America's most trusted business magazine, plus global business, finance and 0:00:18.400 --> 0:00:22.880 tech news. The Bloomberg Business Week Podcast with Carol Messer 0:00:23.040 --> 0:00:25.800 and Tim Stenebeck from Bloomberg Radio. 0:00:26.640 --> 0:00:28.840 Well, our next guest follows the US economy, really the 0:00:28.880 --> 0:00:32.120 global economy has for decades. Weigh in on the trends 0:00:32.159 --> 0:00:35.400 that describe us and divide us financially, economically, and so 0:00:35.520 --> 0:00:38.120 much more. Let's get to the interview this hour with 0:00:38.200 --> 0:00:41.960 us as Nobel Laureate economist and Columbia professor Joseph Stieglitz. 0:00:42.040 --> 0:00:44.760 He was an economic advisor to presidents, including chair of 0:00:44.760 --> 0:00:47.839 the Council of Economic Advisors that was during the Clinton administration. 0:00:48.200 --> 0:00:51.120 Former chief economist at the World Bank, He's written numerous 0:00:51.159 --> 0:00:54.760 books and research papers. His latest book, The Road to Freedom, 0:00:54.800 --> 0:00:57.560 Economics and the Good Society. He joins us here in 0:00:57.560 --> 0:01:00.240 New York City. Professor Stieglitz, So great to be talking 0:01:00.320 --> 0:01:02.360 with you once again. It's been a while, but great 0:01:02.360 --> 0:01:04.880 to have you here, and we want to talk about 0:01:04.880 --> 0:01:07.000 the book. But we would be remiss not to ask 0:01:07.080 --> 0:01:10.800 you your take on today's economic environment and the stickiness 0:01:10.920 --> 0:01:14.560 of inflation. What is the smart conversation that you think 0:01:14.560 --> 0:01:16.880 we should all be having here at Bloomberg when it 0:01:16.880 --> 0:01:18.840 comes to today's US economic environment. 0:01:20.280 --> 0:01:25.120 From the point of view of economics, having two and 0:01:25.160 --> 0:01:28.679 a half or even three percent inflation is not a 0:01:28.680 --> 0:01:31.840 big deal. You know, the two percent target was pulled 0:01:31.880 --> 0:01:34.840 out of thin air. It was not based on economic science. 0:01:35.280 --> 0:01:37.360 What we want to be sure of is that we 0:01:37.400 --> 0:01:41.400 don't have runaway inflation. And inflation has clearly been tamed, 0:01:41.400 --> 0:01:44.640 it's been brought down, it's stable. It lectuates from month 0:01:44.760 --> 0:01:49.840 to month, but it is not a major problem. We 0:01:49.880 --> 0:01:54.520 should be focusing on other things, continuing economic growth, making 0:01:54.560 --> 0:02:00.440 sure that all Americans share in that growth. Those are 0:02:00.480 --> 0:02:02.920 the kinds of things that we ought to be thinking 0:02:02.960 --> 0:02:03.520 more about. 0:02:04.080 --> 0:02:07.800 So, Professor Stieglitz, should the Fed abandon the two percent 0:02:07.880 --> 0:02:11.120 inflation goal? Should they have a different inflation goal, a 0:02:11.120 --> 0:02:13.480 different metric that they should be held accountable to. 0:02:15.040 --> 0:02:16.760 Yes, I think they should. I think they should be 0:02:16.800 --> 0:02:21.600 talking about keeping it within a range to maybe three, 0:02:21.760 --> 0:02:24.960 three and a half four percent. You know, there's actually 0:02:25.120 --> 0:02:29.360 some economic science that says, especially in a time of 0:02:30.040 --> 0:02:34.120 major structural change, such as we're going through, having a 0:02:34.240 --> 0:02:40.600 little higher inflation actually is helpful in reallocating resources in 0:02:40.639 --> 0:02:46.040 the presence of downward nominal rigidities of wages, because what 0:02:46.560 --> 0:02:50.120 guides the movement of resources from one place to another 0:02:50.639 --> 0:02:55.040 is relative wages, and if some wages are sticky downward, 0:02:55.639 --> 0:02:59.480 you want other wages to go up enough to move labor, 0:03:00.080 --> 0:03:02.320 and that means you're going to have to have more inflation. 0:03:03.000 --> 0:03:06.520 So actually a little higher inflation is actually good for 0:03:06.600 --> 0:03:07.720 the economy. 0:03:08.120 --> 0:03:12.280 Do you think the FEDS management of the economy has 0:03:12.360 --> 0:03:14.440 been a good one in terms of policy? 0:03:16.760 --> 0:03:23.640 Quite frankly no, But bluntly, let's go back to when 0:03:24.240 --> 0:03:28.480 inflation broke out after the pandemic and the Russian invasion 0:03:28.480 --> 0:03:32.840 of Ukraine. The question was what was the cause, the 0:03:32.880 --> 0:03:37.160 primary cause of the inflation. It was unambiguous. It was 0:03:37.520 --> 0:03:42.360 the pandemic and war related interruptions in supply chains and 0:03:43.000 --> 0:03:47.720 rising prices caused by shortages of oil and food. It 0:03:47.800 --> 0:03:51.120 was demand shifts. People wanted to live in different places, 0:03:52.040 --> 0:03:54.920 and that meant housing prices went up where there was 0:03:54.960 --> 0:03:57.760 a scarcity, but didn't go down as much where there 0:03:57.800 --> 0:04:02.200 was where people didn't want to. Like in parts of 0:04:02.240 --> 0:04:08.840 New York, raising interest rates actually impedes the ability of 0:04:08.840 --> 0:04:15.720 the economy to respond to that kind of structural to 0:04:15.800 --> 0:04:19.920 that kind of challenge. We needed to build more houses 0:04:20.600 --> 0:04:24.320 in the places where there was a scarcity, and having 0:04:25.839 --> 0:04:31.800 higher interest rates actually works makes it more difficulty. They 0:04:31.839 --> 0:04:34.440 also have a model of the economy that's based on competition. 0:04:34.920 --> 0:04:37.400 That might have been true some time ago, but we 0:04:37.480 --> 0:04:41.840 have an economy with a lot of market power at 0:04:42.040 --> 0:04:46.320 firms are trading off. If they raise their prices, they 0:04:46.320 --> 0:04:49.560 get more profits today, they lose profits in the future. 0:04:50.320 --> 0:04:53.400 And in that trade off, if when you raise the 0:04:53.440 --> 0:04:57.080 interest rate, they value those future losses less, and they 0:04:57.120 --> 0:05:00.960 were induced to raise their prices, more ms go up. 0:05:01.480 --> 0:05:05.880 And a marked aspect of the inflation that we've just 0:05:05.960 --> 0:05:09.640 been through is that markets have increased enormously. 0:05:10.120 --> 0:05:13.680 Hey, Professor Stieglitz, I just wanted to speaking of the FED, Carol, 0:05:13.720 --> 0:05:15.000 I know you would. 0:05:14.920 --> 0:05:17.080 Well one one thing before we have a bigger, broader 0:05:17.160 --> 0:05:19.520 cust and it's certainly been to jump in on that. Well, 0:05:19.560 --> 0:05:21.440 what do you think then we should be cutting rates 0:05:21.440 --> 0:05:23.200 already that were behind the curve right now? 0:05:24.560 --> 0:05:28.000 Yes, I think I think the risks are asymmetric. I 0:05:28.040 --> 0:05:33.160 think with Europe already slowing down in recession, we don't 0:05:33.200 --> 0:05:36.480 know where China is going to be going. I think 0:05:36.839 --> 0:05:41.359 uh proudents would have as uh uh going back to 0:05:41.440 --> 0:05:46.279 a more normal infrast rate. The higher interest rates are 0:05:46.520 --> 0:05:49.000 are really not going to be taming inflation. That that 0:05:49.160 --> 0:05:52.560 model was wrong. In another way, they drammatically had said 0:05:52.560 --> 0:05:54.640 that we're going to need five percent of inflation for 0:05:55.000 --> 0:05:58.080 five percent unemployment for some time in order to get 0:05:58.160 --> 0:06:02.400 inflation down. There were absolutely we got inflation down where 0:06:03.640 --> 0:06:08.039 in a period where we kept unemployment relatively low. So 0:06:08.480 --> 0:06:12.039 their analysis of the economy was just off. And meanwhile 0:06:12.480 --> 0:06:17.280 they have put at risk our banking system. We had 0:06:17.279 --> 0:06:19.960 a problem in Selcom Valley Bank partly because of the 0:06:20.640 --> 0:06:25.120 enormous changes in terms structure which their policies led to. 0:06:25.600 --> 0:06:28.719 And we're facing a deck crisis in the developing countries 0:06:28.720 --> 0:06:33.320 and emerging markets. So there is enormous one sided risk. 0:06:33.520 --> 0:06:38.720 I believe in the policies that they've been pursuing well. 0:06:38.760 --> 0:06:40.600 On the FED, Professor Stieglitz, I got to ask you 0:06:40.640 --> 0:06:43.120 about this Wall Street Journal report that broke last night 0:06:43.440 --> 0:06:46.160 that said how former Trump administration officials are coming up 0:06:46.160 --> 0:06:49.400 with plans to take on the independence of the Federal Reserve, 0:06:49.839 --> 0:06:53.440 essentially at one end of the spectrum, even allowing if 0:06:53.440 --> 0:06:56.320 President Trump gets re elected him to weigh in on 0:06:56.440 --> 0:06:59.200 FED policy when it comes to interest rates. Talk a 0:06:59.240 --> 0:07:02.039 little bit about your reaction to if this were to 0:07:02.160 --> 0:07:05.200 come to fruition, how important the independence of the FED 0:07:05.360 --> 0:07:07.840 is and if that would really put at risk the 0:07:08.240 --> 0:07:10.880 model of the independence of the US financial system. 0:07:12.200 --> 0:07:17.400 Well, I think Trump is himself a major argument why 0:07:17.480 --> 0:07:22.680 you want to have independence of the FED. You don't 0:07:22.680 --> 0:07:29.160 want somebody who doesn't understand monetary policy, who would put 0:07:29.200 --> 0:07:32.320 at risk the long run stability of the economy for 0:07:32.640 --> 0:07:36.760 the short term electoral advantage of having a hot economy 0:07:37.120 --> 0:07:41.800 right before an election. That's precisely why there is an 0:07:41.920 --> 0:07:47.040 argument for independence. So, you know, I believe in the 0:07:47.040 --> 0:07:54.240 accountability of the FED. It is a public institution. We 0:07:54.360 --> 0:08:00.160 had previous chairman of the FED. We're very cognizant that 0:08:00.320 --> 0:08:05.240 I remember Paul Voker saying Congress created us and Congress 0:08:05.280 --> 0:08:08.840 can uncreate us. So there is a kind of accountability 0:08:08.920 --> 0:08:12.880 that responsible to heads of the FAT understand. But we 0:08:12.960 --> 0:08:16.880 certainly don't want Donald Trump to be running monetary policy. 0:08:17.640 --> 0:08:19.559 All right, we do want to dig into your book 0:08:19.640 --> 0:08:22.600 because you've been thinking a lot about the meaning of freedom, 0:08:22.640 --> 0:08:24.880 and I think we throw the word a down a lot. 0:08:25.920 --> 0:08:30.280 I think the folks who created the United States are 0:08:30.400 --> 0:08:34.760 founding fathers thought about freedom a lot and the difference 0:08:34.800 --> 0:08:38.480 though between what that really means, and maybe it comes 0:08:38.520 --> 0:08:40.960 down to, as you think about it, the values that 0:08:41.000 --> 0:08:43.440 we all have in society tell us about how we 0:08:43.480 --> 0:08:46.600 need to kind of maybe redefine freedom and what it 0:08:46.679 --> 0:08:52.559 means in terms of citizens more broadly and generally, as 0:08:52.600 --> 0:08:55.040 well as economically in terms of their success. 0:08:56.120 --> 0:09:01.240 Sure you know, I approached the issue obviously as an economist, 0:09:01.720 --> 0:09:05.560 and as an economist we think of freedom is free 0:09:05.600 --> 0:09:07.920 to do what you can do. What are the choices 0:09:07.960 --> 0:09:11.680 that you can make. Somebody who is at the point 0:09:11.679 --> 0:09:14.480 of starvation doesn't really have any freedom. He has to 0:09:14.520 --> 0:09:20.000 do what he can to survive, and so expanding the 0:09:20.040 --> 0:09:24.480 set of choices that an individual is available is a 0:09:25.280 --> 0:09:28.560 way of saying that he has more freedom. And here 0:09:28.640 --> 0:09:32.000 there are a couple of ideas I put forward in 0:09:32.040 --> 0:09:38.320 my book. The first is that in our integrated urban 0:09:39.160 --> 0:09:45.439 twenty percentury economy, one person does the expansion of his 0:09:45.559 --> 0:09:51.480 freedom may lead to less freedom of others. Isaiah Berlin, 0:09:51.600 --> 0:09:55.160 the great Oxford philosopher, put it this way. He said, 0:09:55.760 --> 0:09:58.680 freedom for the woolfs has often meant death for the sheep. 0:10:00.320 --> 0:10:05.360 In the context of the US, for instance, freedom to 0:10:05.400 --> 0:10:11.360 carry in AK forty seven means that people will die, 0:10:11.920 --> 0:10:15.520 and it means that our school children are not free 0:10:15.559 --> 0:10:19.760 from fear. They have to learn what to do if 0:10:19.800 --> 0:10:24.560 a gunman comes into the classroom, and teachers have to 0:10:24.600 --> 0:10:29.400 go to school worried about whether they'll be attacked. Freedom 0:10:29.480 --> 0:10:33.520 not to wear masks is exposed to taking away the 0:10:33.559 --> 0:10:41.160 freedom of others to live. So we have to balance 0:10:41.280 --> 0:10:45.480 these freedoms. There are trade offs. Many cases, those trade 0:10:45.480 --> 0:10:50.920 offs are easy. Freedom to pollute takes away the freedom 0:10:52.120 --> 0:10:57.120 to have somebody with asthma to even live, let alone 0:10:58.080 --> 0:11:00.360 the freedom of all of us to live in our Atlanta. 0:11:01.600 --> 0:11:06.560 So there, I think we have to constrain the freedom 0:11:06.600 --> 0:11:09.280 of the pluters and the freedom of exploiters. 0:11:09.760 --> 0:11:13.240 So we're talking with Joseph Stieglitz, Nobel Laureate Economists, Professor 0:11:13.240 --> 0:11:16.040 of economics at Columbia University, and we're talking about his 0:11:16.040 --> 0:11:18.680 new book, The Road to Freedom economics and the good society. 0:11:18.880 --> 0:11:23.160 All right, So if wethink Professor Stieglitz the idea of freedom, 0:11:23.320 --> 0:11:26.640 so it's maybe more inclusive or it's a broader definition. 0:11:27.120 --> 0:11:31.400 How do we do that within society? With corporations the 0:11:31.520 --> 0:11:34.800 need to be profitable for those we are in earning season. 0:11:34.840 --> 0:11:36.960 We look at companies and their reports and that's how 0:11:37.040 --> 0:11:40.880 we kind of measure them, grade them. What does government 0:11:40.960 --> 0:11:43.280 need to do? How can we maybe be better if 0:11:43.280 --> 0:11:44.240 you will for more? 0:11:45.720 --> 0:11:50.080 Well, first, let me emphasize that in the world I've 0:11:50.160 --> 0:11:56.760 just described, there's an important role for regulations. Corporations often 0:11:56.800 --> 0:12:00.280 don't like that, but we have to remember us of 0:12:00.320 --> 0:12:03.880 our economy is to improve the lives and livelihoods of 0:12:04.600 --> 0:12:10.840 our citizens. It's not the other way around that the economy. 0:12:10.960 --> 0:12:13.199 The economy is supposed to serve society, not the other 0:12:13.240 --> 0:12:21.760 way around. There's another aspect. Regulations can't actually expand the 0:12:21.800 --> 0:12:25.679 freedom of all of us. Think about stop likes. If 0:12:25.679 --> 0:12:29.240 we don't have stop stop likes, we have gourdlock. None 0:12:29.320 --> 0:12:32.280 of us has the freedom to move. Stop likes works 0:12:32.360 --> 0:12:36.400 are a little bit of coercion, mean that I have 0:12:36.480 --> 0:12:39.640 to take turns, but by taking turns, we all have 0:12:39.960 --> 0:12:44.360 more freedom, and that basic idea extends much more broadly. 0:12:46.200 --> 0:12:49.280 People don't like to pay taxes, that that's a they 0:12:49.280 --> 0:12:53.800 often feel kind of coercion. But when those tax revenues 0:12:53.840 --> 0:12:57.680 are used productively, like they were to invest in the 0:12:57.679 --> 0:13:01.360 Internet and invest in the m R A platform that 0:13:01.440 --> 0:13:05.400 led to the vaccine against COVID nineteen, that expands our 0:13:05.400 --> 0:13:10.439 freedom to do. And so we have to look at 0:13:10.480 --> 0:13:12.480 this in I would say in a little bit more 0:13:12.520 --> 0:13:13.280 holistic way. 0:13:13.520 --> 0:13:15.640 Well, I want to go to your taxes point, because 0:13:15.640 --> 0:13:18.440 I'm curious if you could wave a magic wand or 0:13:18.440 --> 0:13:21.280 implement some sort of tax policy here in the US, 0:13:21.600 --> 0:13:24.760 what would it be? How could you reinvent it? Would 0:13:24.800 --> 0:13:26.840 you broaden the tax space, would you lean more on 0:13:26.880 --> 0:13:29.839 corporate taxes? Would you tax wealth more? What, in your 0:13:29.840 --> 0:13:30.760 opinion would work? 0:13:31.960 --> 0:13:37.000 Well, I begin by analyzing would are some of the 0:13:37.080 --> 0:13:40.640 key problems on our society basis? And one of them 0:13:40.720 --> 0:13:44.280 is inequality one of the reasons. And a second problem 0:13:44.600 --> 0:13:48.079 is the growth of market power, which has been enormous 0:13:48.440 --> 0:13:53.480 in the last few decades, and those two are obviously linked. 0:13:53.760 --> 0:13:56.880 When you have more market power, the fruits of that 0:13:56.920 --> 0:14:01.079 market power go to those at the top. We also 0:14:01.200 --> 0:14:07.160 have more economists called monoposity power. Firms have market power 0:14:07.200 --> 0:14:12.160 over workers and have driven down their wages significantly below 0:14:12.240 --> 0:14:17.080 a competitive level. So I want to have more anti 0:14:17.120 --> 0:14:23.960 trust policy, more competitive labor market policies, but that can 0:14:24.120 --> 0:14:28.840 take time. Meanwhile, there's a lot of monopoly rents, and 0:14:28.920 --> 0:14:31.760 so part of what I would begin by doing is 0:14:31.880 --> 0:14:36.240 increasing corporate confix taxes, which are not a tax on 0:14:36.360 --> 0:14:40.760 return to capital. They are a tax on this monopoly profits. 0:14:42.320 --> 0:14:46.560 I'd also like to have environmental taxes. Firms that are engaged, 0:14:46.600 --> 0:14:51.120 including the environment, ought to pay for the damage that 0:14:51.160 --> 0:14:59.120 they're doing. Remarkably, America, those at the top pay a 0:14:59.200 --> 0:15:07.440 lower percentage of their taxes than those down below. Even 0:15:07.480 --> 0:15:10.080 some of our richest people have commented that they think 0:15:10.080 --> 0:15:11.720 they're right more wrong. 0:15:12.160 --> 0:15:14.200 Well, can I ask you, like on a day when 0:15:14.240 --> 0:15:16.240 we're looking at a company and forgive me, I'm just 0:15:16.320 --> 0:15:20.440 singling out because it popped. Shares of Alphabet are now 0:15:20.440 --> 0:15:24.400 a two trillion dollar market cap company this week, you know, 0:15:24.800 --> 0:15:27.520 next week. Last week. We've been obsessed with, certainly what 0:15:27.520 --> 0:15:30.440 we call the Magnificent seven, the big megacap technic companies. 0:15:30.760 --> 0:15:33.760 They're very big, Amazon we talked with an author recently, 0:15:33.880 --> 0:15:37.040 so entrenched certainly in our world, and you think about 0:15:37.080 --> 0:15:40.840 their reach. Are these the companies, the individuals, whether it's 0:15:40.880 --> 0:15:43.720 an Amazon, whether it's a Meta, whether it's an alphabet 0:15:43.760 --> 0:15:46.880 that you think you talked about growth of market power? 0:15:47.080 --> 0:15:50.120 Is it too much at this point in your view 0:15:50.600 --> 0:15:52.640 that something needs to be done to rain them in 0:15:52.800 --> 0:15:56.720 or do the benefits outweigh the downside here? 0:15:57.640 --> 0:16:00.320 Well, they do give benefits, but they have a lot 0:16:00.320 --> 0:16:05.120 of downsides. They need to be better regulated. Europe has 0:16:05.120 --> 0:16:09.880 done a better job at regulating them. The digital harms 0:16:09.960 --> 0:16:14.920 are are quite obvious and have been by now well documented. 0:16:15.400 --> 0:16:24.320 But talking narrowly now about market power, I think we 0:16:24.360 --> 0:16:27.040 ought to do what we can to limit their market power, 0:16:27.440 --> 0:16:32.040 but tax the fruits of that market power, the revenues 0:16:32.560 --> 0:16:35.720 that they get at a much higher rate. You know, 0:16:35.800 --> 0:16:42.760 if you ask the question, would Jeff Bezos or the 0:16:42.840 --> 0:16:49.400 founders of Google or Zuperbird stop working if we tax 0:16:49.480 --> 0:16:54.120 their wealth in a way, say a three percent? You know, 0:16:54.480 --> 0:16:59.280 so any answer is obviously they would continue to work. 0:16:59.280 --> 0:17:01.040 But do you think that they would leave the United States? 0:17:02.880 --> 0:17:06.960 Well, we have imposed what we call an exit tax 0:17:07.520 --> 0:17:10.200 that those with a lot of wealth and don't feel 0:17:10.280 --> 0:17:15.200 who don't feel loyalty at the United States can leave. 0:17:15.240 --> 0:17:18.560 We allow them to leave, but they have to pay 0:17:18.600 --> 0:17:22.479 a tax that represents attacks on the groups of the 0:17:22.520 --> 0:17:25.600 wealth that they've accumulated while they've been in the United States. 0:17:26.440 --> 0:17:31.000 And that tax is significant, and it is a deterrent. 0:17:32.080 --> 0:17:35.080 And if it's not, it may be that we ought 0:17:35.080 --> 0:17:39.200 to consider raising that tax. But I don't think people 0:17:39.440 --> 0:17:43.080 like Zuckerberg Musk are going to leave the United States. 0:17:43.280 --> 0:17:47.359 They realize the benefits of American citizenship. 0:17:47.920 --> 0:17:51.520 We're speaking right now with Professor Joseph Stieglitz, Nobel Lauriate Economists. 0:17:51.560 --> 0:17:54.040 He's a professor of economics at Columbia University. He's got 0:17:54.040 --> 0:17:56.320 a new book out, The Road to Freedom, Economics and 0:17:56.359 --> 0:17:59.800 the Good Society. Professor, as I mentioned, you are up 0:17:59.800 --> 0:18:02.000 at Columbia. You've been there for a long time. We've 0:18:02.040 --> 0:18:04.920 been watching everything that's been happening on the campus there, 0:18:04.920 --> 0:18:08.600 as well as campuses including USC Yale, MI T. The 0:18:08.640 --> 0:18:11.000 list continues to go on here in the United States, 0:18:11.040 --> 0:18:14.200 as we've seen pro Palestinian protests and encampments take over 0:18:14.280 --> 0:18:18.720 some of these campuses. Freedom in the academic context, how 0:18:18.760 --> 0:18:21.120 are you looking at the protest protests and the context 0:18:21.200 --> 0:18:22.200 of freedom of speech? 0:18:24.200 --> 0:18:26.480 That's a good question. I mean, first of let me 0:18:26.560 --> 0:18:29.639 comment that up where my office is, which is the 0:18:29.680 --> 0:18:36.120 Manhattanville campus, things are very quiet at the business school. 0:18:36.640 --> 0:18:38.520 At the Business school, quiet there. 0:18:39.080 --> 0:18:41.480 But you've been on campus a long time and you've 0:18:41.480 --> 0:18:44.040 seen different protests over the years, and it seemed to 0:18:44.040 --> 0:18:45.800 be I was there when there were protests, and it 0:18:46.440 --> 0:18:49.760 seems like that's what students are should be doing, exploring 0:18:49.840 --> 0:18:51.960 and pushing back when they don't feel like things are right. 0:18:52.760 --> 0:18:55.080 But what is what is the what is it those 0:18:55.119 --> 0:18:56.800 protests in the context of freedom of speech? 0:18:57.680 --> 0:19:01.639 So I agree with you very strongly. I'm actually happy 0:19:01.680 --> 0:19:04.919 that the students are engaged in the world. You know, 0:19:05.000 --> 0:19:07.520 that's one of the things I try to get them 0:19:07.520 --> 0:19:11.800 to be interested in the world, and also to reason 0:19:12.840 --> 0:19:16.320 about the world, to come to understand it, and to 0:19:16.400 --> 0:19:23.280 debate how could or should things be changed. So that's 0:19:23.280 --> 0:19:27.679 a good thing. And in my own life, protests have 0:19:27.760 --> 0:19:33.880 played a very important role. Back in nineteen sixty three, 0:19:34.560 --> 0:19:36.840 I was down there in the march in Washington with 0:19:36.960 --> 0:19:41.440 Martin Luther King, and you know that speech she gave 0:19:41.560 --> 0:19:46.679 about I have a dream has been a lifelong inspiration 0:19:46.840 --> 0:19:53.440 to me. So even civil disobedience in certain circumstances can 0:19:53.520 --> 0:19:59.560 be an important mechanism for social change. We have a 0:19:59.600 --> 0:20:04.160 special responsibility, of course, to make sure on our campus 0:20:04.200 --> 0:20:08.200 that all views get heard, that we can have civil debates, 0:20:08.920 --> 0:20:17.080 and so on. The one end, academic freedom is really important, 0:20:17.640 --> 0:20:22.600 and I really took offense to Speaker Johnson coming up 0:20:22.600 --> 0:20:27.080 to our campus and calling for the resignation of our president. 0:20:27.880 --> 0:20:32.800 I hadn't seen anything like that, maybe since the HUAC 0:20:33.640 --> 0:20:37.520 hearings the House on American Activities Committee back with McCarthy 0:20:37.560 --> 0:20:41.080 in the fifties. I mean, that kind of direct interference 0:20:41.720 --> 0:20:47.080 in academia is just unheard of. And we know some 0:20:47.119 --> 0:20:51.119 of the Republicans have been trying to undermine universities because 0:20:51.520 --> 0:20:56.640 universities teach children how to our young our youngsters, our 0:20:56.680 --> 0:20:59.680 young men and women how to think, and a lot 0:20:59.720 --> 0:21:02.720 of peopleeople don't like that idea that they should be 0:21:02.760 --> 0:21:09.520 thinking for themselves. But at the same time, we have 0:21:09.640 --> 0:21:15.960 to create on campus a community where all voices are heard, 0:21:16.359 --> 0:21:19.280 and I think we're actually working very much towards that. 0:21:20.240 --> 0:21:30.080 There were only a few people raising problems and I 0:21:30.119 --> 0:21:36.760 think having outside agitators like the speaker is not helpful. 0:21:37.840 --> 0:21:40.080 We're going to leave it on that note. We always 0:21:40.119 --> 0:21:42.960 appreciate hearing you talk about hearing from voices. We always 0:21:42.960 --> 0:21:45.960 appreciate hearing from you. Professor Stieglitz, Thank you so much, 0:21:46.200 --> 0:21:50.000 Nobell Lorid Economist Columbia Professor Joseph Stieglitz here in New 0:21:50.080 --> 0:21:53.119 York City. Check out his book. His latest book, The 0:21:53.200 --> 0:21:57.160 Road to Freedom, Economics and the Good Society really appreciates 0:21:57.200 --> 0:22:00.000 spending some time with you. 0:22:00.160 --> 0:22:03.679 You're listening to the Bloomberg Business Week podcast. Catch us 0:22:03.720 --> 0:22:06.960 Live weekday afternoons from two to five pm Eastern Listen 0:22:07.000 --> 0:22:09.159 on Apple car Play and then Brote Auto with a 0:22:09.200 --> 0:22:13.320 Bloomberg Business act or wants us live on YouTube. 0:22:14.160 --> 0:22:18.000 Intel shares folks, they are down the most in not 0:22:18.240 --> 0:22:21.399 quite four years, but they're still down about nine and 0:22:21.440 --> 0:22:24.480 a half percent. Here. This is after the company gave 0:22:24.520 --> 0:22:28.280 a lot lackluster forecast for the current period and turning 0:22:28.320 --> 0:22:30.480 this giant tim as we find out, you know, they're 0:22:30.520 --> 0:22:33.240 in the midst of a turnaround. It's not turning out 0:22:33.280 --> 0:22:34.320 to be so easy. Yeah. 0:22:34.359 --> 0:22:36.960 In fact, here's Intel CEO Pat Gelsinger on the good 0:22:37.000 --> 0:22:39.399 and the better to come. He joined Bloomberg TV and 0:22:39.480 --> 0:22:40.800 Radio a little earlier today. 0:22:40.880 --> 0:22:41.360 Check it out. 0:22:41.680 --> 0:22:44.600 We delivered a solid Q one, right, we met on revenue, 0:22:44.680 --> 0:22:47.919 we know, beat on earnings a bit tepid in the 0:22:47.960 --> 0:22:49.840 first half, as we said, but we see a lot 0:22:49.880 --> 0:22:53.280 of improvement as we go through the year. And with that, 0:22:53.400 --> 0:22:56.560 obviously the foundry business, as I would say, we're going 0:22:56.640 --> 0:22:59.560 to see progress on the foundry business every quarter from 0:22:59.600 --> 0:23:01.320 now for the end of the decade. 0:23:01.800 --> 0:23:05.359 That's Pat Gelsinger, Intel CEO, earlier on Bloomberg TV and 0:23:05.480 --> 0:23:07.880 Radio with more on the company's business and plan turnaround. 0:23:07.920 --> 0:23:10.440 Back with us as Bloomberg News US Semiconductor and Networking 0:23:10.480 --> 0:23:14.080 reporter in our San Francisco bureau, Ian King, So, Ian 0:23:14.200 --> 0:23:18.119 the quarter, what occupies you the most on the release 0:23:18.119 --> 0:23:20.360 and then after the call with analysts yesterday, because as 0:23:20.359 --> 0:23:25.760 Carol mentioned, the reaction to the report, at least when 0:23:25.760 --> 0:23:27.960 it comes to the stock was really swift. 0:23:28.640 --> 0:23:31.720 Yeah, I think the quote you played from Pat is 0:23:32.119 --> 0:23:35.600 relevant here. I mean, you've got a man who hasn't 0:23:35.680 --> 0:23:38.440 been back at Intel for that long, putting a long 0:23:38.560 --> 0:23:42.800 term plan together, trying to repair the mistakes made over 0:23:42.840 --> 0:23:47.320 a decade. Though that plan won't pay off anytime soon, 0:23:47.880 --> 0:23:51.280 but in the meantime, he's having to give quarterly earnings 0:23:51.320 --> 0:23:56.320 and anything that's kind of lackluster as the forecast was yesterday, 0:23:57.000 --> 0:24:00.000 is going to cause concern and that this long time 0:24:00.200 --> 0:24:02.399 plan isn't going to pay off. So he's he's selling 0:24:02.440 --> 0:24:06.920 a bright future while talking about kind of lightless their 0:24:06.960 --> 0:24:08.040 interim period. 0:24:08.320 --> 0:24:09.960 You know, it makes me think about like, every once 0:24:10.000 --> 0:24:12.040 in a while, I bet a company would just be like, 0:24:12.280 --> 0:24:14.159 can we just go public for a few years and 0:24:14.240 --> 0:24:17.399 kind of clear things out, spend, do the reboot, and 0:24:17.440 --> 0:24:19.400 then we'll come back to the public markets. We've seen 0:24:19.440 --> 0:24:23.520 it before, but I almost feel like, potentially, you know, Ian, 0:24:23.560 --> 0:24:24.880 that's what Intel needs right now. 0:24:25.920 --> 0:24:29.840 Yeah, I mean that's definitely something that's been talked about 0:24:29.920 --> 0:24:32.600 by you know, people who sort of look at Intel 0:24:32.760 --> 0:24:35.080 and where they are and that's you know, that's the 0:24:35.119 --> 0:24:38.600 position they're in. As we've said that, you know, there's 0:24:38.600 --> 0:24:40.919 going to have to be significant changes not just at 0:24:40.960 --> 0:24:44.840 Intel but in this semiconductor industry in general for this 0:24:44.920 --> 0:24:48.600 big plan to pay off. The analysts like the strategy, 0:24:48.720 --> 0:24:53.120 say he's pressing the right buttons, but again, so many variables, 0:24:53.320 --> 0:24:55.879 so many things have to go right for everything to 0:24:55.960 --> 0:24:59.000 pay off and Intel become at the level it used 0:24:59.040 --> 0:24:59.119 to be. 0:24:59.440 --> 0:25:01.239 One thing I want to ask you, I mean the 0:25:01.240 --> 0:25:03.640 foundry business. It's an expensive one, right. I just talked 0:25:03.640 --> 0:25:06.639 with some investment folks. I was planning for a panel 0:25:06.640 --> 0:25:08.760 that I'm going to be doing in a couple of weeks. 0:25:08.920 --> 0:25:11.200 They have lots of money to invest, and one of 0:25:11.240 --> 0:25:13.639 the themes that was top of mind was reshoring and 0:25:13.640 --> 0:25:16.679 the amount of money that they need to invest. The 0:25:16.680 --> 0:25:18.280 capital spend that we were seeing in the likes of 0:25:18.320 --> 0:25:22.080 things like semiconductors and the industrial space as a lot 0:25:22.119 --> 0:25:24.960 of countries, including the United States, are bringing things back home. 0:25:25.040 --> 0:25:27.000 It's real and some of it has to do with 0:25:27.040 --> 0:25:30.040 climate change, and you know, companies trying to kind of 0:25:30.040 --> 0:25:33.920 clean up their supply chains and so closer manufacturers help 0:25:33.960 --> 0:25:37.360 them do this. This foundry focus. Will it pay off 0:25:37.400 --> 0:25:39.000 in the long run or TBD? 0:25:40.240 --> 0:25:43.040 It's very much a TBD. I mean, as you said, 0:25:43.080 --> 0:25:45.919 there's a geographical trend here. Intel is building plants in 0:25:45.960 --> 0:25:48.920