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Speaker 1: Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Along

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Speaker 1: with Jonathan Ferrell and Lisa Bramowitz Jaily, we bring you

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Speaker 1: insight from the best and economics, finance, investment, and international relations.

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Speaker 1: Find Bloomberg Surveillance on Apple Podcast, SoundCloud, Bloomberg dot Com,

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Speaker 1: and of course, on the Bloomberg terminal. Tom Kate with

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Speaker 1: Im Brema. If you write a great the founder in President,

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Speaker 1: you write a HQ. Morning Tom, John only said good

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Speaker 1: morning to you, and it is what we do at

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Speaker 1: the beginning of the year. We start strong with the

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Speaker 1: top risks of your Asia group. It is a must.

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Speaker 1: Reid twenty seven pages of brilliance. Far too optimistic this

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Speaker 1: year on the comparative strength of American joining us with

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Speaker 1: a brief throughout surveillance this morning. Ian Brehmer, Bill Dudley

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Speaker 1: will join us on a divided America. Will do that

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Speaker 1: in a bit, but right now not a divided China.

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Speaker 1: G is at maximum power? Does it give way in

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Speaker 1: two thousand three? Does this power after that Congress? Dr

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Speaker 1: Bremer doesn't have it? Doesn't Uh. I'm gonna be with you, Tom,

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Speaker 1: Happy New Year to you. It's always good to be

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Speaker 1: kicking this off with you, Um, you know, there's no

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Speaker 1: question that both for China as the second largest economy

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Speaker 1: in the world, but also with she jun Ping having

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Speaker 1: consolidated so much power in his hands and using it

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Speaker 1: in ways that are capricious and are not in any

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Speaker 1: way transparent, the global economy has never experienced anything like that,

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Speaker 1: that level of uncertainty in the persona of one human being.

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Speaker 1: We've we've seen it with the decision to do a

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Speaker 1: complete degree bothas with the pandemic and zero COVID. We've

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Speaker 1: seen it with a trillion dollars off of market value

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Speaker 1: of Chinese tech stocks because she Jun pin decided that

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Speaker 1: he was going to squeeze them. That level of uncertainty

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Speaker 1: as China reopens their economy this year with no level

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Speaker 1: of data that we used to get five ten years

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Speaker 1: ago from the Chinese, even as an enormously concerning issue,

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Speaker 1: this is important and this goes to your colleague in

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Speaker 1: crime on this Elizabeth Economy. You see if ar now,

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Speaker 1: a secretary of Ramando in Congress Economy told me years ago,

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Speaker 1: don't overestimates power. Have we seen the maximum? Have we

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Speaker 1: have we brought down? Do we see him weaken particularly

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Speaker 1: off the COVID disaster. We see China weekend a little

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Speaker 1: bit on the global stage. Certainly the lessons they're taking

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Speaker 1: for Taiwan now that they've seen the United States and

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Speaker 1: NATO in Ukraine. The lessons they're taking from concerns about

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Speaker 1: American economic strength visa viast China on semiconductors for example,

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Speaker 1: on the ability and willingness to impose export controls, and

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Speaker 1: the fact that Chinese have sat on their hands. J

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Speaker 1: and Ping is not in the same geopolitical position he

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Speaker 1: was in before the pandemic started, but politically inside China

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Speaker 1: he is only shrunk. And that is a that that

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Speaker 1: is the nature of the risk. For are you lead

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Speaker 1: with Russia in the top top ten risks? But how

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Speaker 1: does China permeate out to all the other thinkings of

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Speaker 1: the top risk this year? They just seem to dominate

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Speaker 1: every conversation. Well, it's not that the Chinese do it,

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Speaker 1: it's something very specific does which is the at the

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Speaker 1: time that the United States democracy and economy is actually

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Speaker 1: coming out more resilient and stronger than anyone out there

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Speaker 1: would have imagined one to three years ago. Uh. We

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Speaker 1: are seeing around the world a significant number of super

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Speaker 1: empowered individuals who aren't getting great inputs from experts, who

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Speaker 1: are able to act with impunity and are not getting

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Speaker 1: what they want in various ways. On the global stage,

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Speaker 1: Putin is one, She is another, The Iranian supreme leaders

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Speaker 1: a third, and a small handful of tech center billionaires

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Speaker 1: are a fourth, and those individuals are driving it. Disc

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Speaker 1: menstrument amounts of global risk in the marketplace. Right now,

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Speaker 1: let's look at your work G zero the concept of

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Speaker 1: G twenty G seven down to a codified Bremer phrase

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Speaker 1: G zero, or much more importantly, for Americans, us versus them,

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Speaker 1: is the basic drama out there. How do we prosecute

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Speaker 1: in two thousand twenty three a foreign policy with forget

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Speaker 1: about Putin? How do we prosecute a foreign policy with

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Speaker 1: China that gets something done twelve months from now? Well,

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Speaker 1: two different ways. On the competitive side, you lean lean

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Speaker 1: into American strength, which turns out to be national security

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Speaker 1: broadly defined. So in the same way that the Germans

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Speaker 1: have made mistakes for decades and the Europeans are at

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Speaker 1: large and letting too much of their energy security lean

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Speaker 1: on Russia, the Americans have let too much of our

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Speaker 1: technology national security lean on Taiwan a hundred miles away

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Speaker 1: from the mainland. Now, what we are now trying do

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Speaker 1: not just the United States but with allies as well,

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Speaker 1: and say we're going to redress that. We're going to

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Speaker 1: redress it because of national security. So you, the Japanese, you,

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Speaker 1: the South Korean's, you, the EU, the UK, the Canadians,

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Speaker 1: You're all going to be with us on these export

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Speaker 1: controls for anything the Chinese could use that would threaten

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Speaker 1: our national security directly. And that's a policy that will

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Speaker 1: align the G seven more broadly on China. That's important.

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Speaker 1: But at the same time, Biden does not want to

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Speaker 1: be in a cold war where the Chinese doesn't want

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Speaker 1: to fight over Taiwan. He doesn't want the impact of

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Speaker 1: competition on national security to bleed out into the broader

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Speaker 1: economic interdependence of the For something new here, and I

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Speaker 1: haven't gotten from Secretary Blank, and I don't think I've

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Speaker 1: gotten from the Biden administration. Let's go back to something

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Speaker 1: like the military industrial complex. This is back when Tulane

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Speaker 1: had terrible football and they won a year ago. They

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Speaker 1: you know, they stunned USC last night, which was great

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Speaker 1: to see. But the shock of Tulane football. I'm looking

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Speaker 1: for a shock in the Bremer world in your top risks.

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Speaker 1: What's the thing our viewers and listeners have to look

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Speaker 1: for six months in twelve months from now. Well, the

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Speaker 1: shock that comes from a Chinese leader that is making

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Speaker 1: policies and in the end of zero COVID. A lot

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Speaker 1: of people thought that it was going to be incremental

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Speaker 1: after he secured power in that for that unprecedented third

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Speaker 1: term in the Party Congress, he didn't move away from

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Speaker 1: at all. No, it shocked everyone. No one was expecting

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Speaker 1: this even three months ago, even two months ago. Why

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Speaker 1: in response to sudden demonstrations, the information got to him,

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Speaker 1: and he, as an individual dictator of the second largest

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Speaker 1: economy of the world, made that decision. We're going to

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Speaker 1: see more uncertainty of that kind from the the most

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Speaker 1: powerful individual on planet Earth. In three Putin is in

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Speaker 1: a corner. I want to finish up here in China

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Speaker 1: because we're gonna talk to Bill Dudley later. We're gonna

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Speaker 1: talk to Mr RhoD of Australia later. Of course, focus focus,

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Speaker 1: focus on Europe. We'll do that folks here in a

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Speaker 1: bit with Carl Bill. Okay, fine, but is that the

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Speaker 1: chemistry of China change. The history is it's city states

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Speaker 1: like Shanghai and the new Hong Kong and all that

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Speaker 1: versus a federal Beijing. Is that traditional calculus still in place.

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Speaker 1: I haven't seen it since Mao. What's happening right now?

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Speaker 1: And at the time of Mao, the enormous amount of

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Speaker 1: uncertainty in China didn't matter to the global economy. They

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Speaker 1: weren't interconnected to it, and they were vastly less powerful.

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Speaker 1: We today have the same level of concentration of power

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Speaker 1: that you had during some of the worst episodes chapters

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Speaker 1: of Chinese history. To that concentration the autocratic power with confidence,

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Speaker 1: but also with strategic patients. In other words, take shots

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Speaker 1: when you know they are important with allies strategically. The

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Speaker 1: new policy that you see from Biden is on semiconductors

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Speaker 1: and export controls. That is contained a sea change, but

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Speaker 1: in other areas of the economy, don't allow that to

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Speaker 1: dictate what you're doing. One minute, here, we've got to

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Speaker 1: get back to John and Lisa on the market's very

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Speaker 1: very importantly. Here do you see a rekindling of what

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Speaker 1: I'm gonna call from World War Two? MacArthur isolationism. No, no,

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Speaker 1: don't want that. It's not that they don't want it.

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Speaker 1: It's that everyone that throws money around in the United

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Speaker 1: States strongly wants to ensure that doesn't happen. Furthermore, no

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Speaker 1: American allies on the global stage. One it, not one,

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Speaker 1: not one, Not the Japanese, not the Europeans. That bad

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Speaker 1: in cares about that. Thirty seconds, John Ferrold demanded, I

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Speaker 1: asked you this question. You nailed Merkel in Germany two

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Speaker 1: risks ago, top ten risks ago. Did Merkel fail in Germany?

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Speaker 1: Did Merkel? Is a reason where where we are in

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Speaker 1: Europe right now to tease the Carl built? Is it

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Speaker 1: because miracle failed? Merkel failed on energy policy and now

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Speaker 1: they are paying the price for that. The unit the

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Speaker 1: European Union is stronger today in part because of work

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Speaker 1: that Merkel did. You have to give our a middle

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Speaker 1: and grade that to twos. What we're gonna do with

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Speaker 1: Dr Bremer here you raise your group, they celebrate the

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Speaker 1: anniversary and very importantly their top ten risks stuff. William

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Speaker 1: Dudley here, of course, formerly with a New York phone

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Speaker 1: and ready for Bloomberg opinion Bill in your essay today

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Speaker 1: for Bloomer Opinion. You focus on the fiscal part of

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Speaker 1: the challenges here in the year four it is not

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Speaker 1: so much a monetary impulse but a fiscal impulse. How

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Speaker 1: will that change the Fed's work? Well, the MANTA policy

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Speaker 1: is still gonna be tricky. How how high do you

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Speaker 1: go for how long and how much slow down to

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Speaker 1: you to tolerate. I think the fiscal is the big risk,

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Speaker 1: so that it's not remarked on by virtually anybody. Uh,

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Speaker 1: We're gonna end end this business cycle at a budget

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Speaker 1: deficit of about five percent of GDP, which is a

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Speaker 1: really horrible place to end the business cycle. Ad and

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Speaker 1: that before we actually get all the costs associated with

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Speaker 1: higher interest rates on debt service and the costs associated

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Speaker 1: with social security and medicare as a baby blue generation retires.

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Speaker 1: So I think the fiscal situation the US has deteriorated

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Speaker 1: very sharply up to now. Markets have been extremely tolerant

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Speaker 1: about this bill. Duddeley, I want to go back here,

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Speaker 1: and it is a top ten risk of media, which

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Speaker 1: is the gloom up there. The world's gonna end, and

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Speaker 1: we're gonna have the recession to end all recessions. Take

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Speaker 1: us back to your study of recession history and guessing

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Speaker 1: at Berkeley years ago, can we actually guess a recession

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Speaker 1: in two thousand twenty three, Well, recession is pretty likely

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Speaker 1: just because of what the FIT has to do. The

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Speaker 1: FED has to drive up the unemployment rates sufficiently to

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Speaker 1: slow down the economy. Uh, to generate slack in the

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Speaker 1: layer market, to bring wage inflation down to a level

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Speaker 1: consistent with two percent inflation. But what's different this time,

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Speaker 1: I think is that this if we have a recession,

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Speaker 1: it's going to be a FED induced recession, and the

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Speaker 1: FED can end the recession by subsequently see monitoring policy.

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Speaker 1: I don't think that there's a big risk of a

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Speaker 1: financial instability cataclysm that pushes the economy into a deep recession.

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Speaker 1: I think this is a recession where the defense, you know,

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Speaker 1: has the controls. When they need to ease, they can

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Speaker 1: do so that the challenge for them is to not

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Speaker 1: ease too soon. Uh. And but these in a timely way, Bill, don't.

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Speaker 1: I've got time for one question, and I want to

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Speaker 1: bring it over to Dr Bremer's study at you raise

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Speaker 1: a group of our risks, and our division is Republican

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Speaker 1: or Democrat. Monetary policy are they really all that much different?

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Speaker 1: End of the day, it's really about how you treat

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Speaker 1: the independence of the FED, what you actually criticize the

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Speaker 1: FED through its actions, or do you leave it alone.

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Speaker 1: The Democrats, really, starting with the Bill Clinton's administration, have

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Speaker 1: been very hands off on the FED. Let the FED

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Speaker 1: do their job. Republicans, especially under the Trump administration, and

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Speaker 1: we're much more combative in terms of instructing the FIT

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Speaker 1: what the FIT should do. I think the Democratic approach

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Speaker 1: is better because it keeps some markets more calm, allows

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Speaker 1: the FED to be more effective and translating its actions

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Speaker 1: in terms of the tightening of financial conditions that it

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Speaker 1: needs to have to control the growth rate of the

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Speaker 1: econmy but there's a difference between the two parties in

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Speaker 1: terms of how independent they treat the FIT. Too. Short

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Speaker 1: of visit Bill Dudley, thank you so much for joining us,

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Speaker 1: and beyond qualified to speak of the Pacific rim of

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Speaker 1: his Australia and China. Is a gentleman, fluent Mandarin, a

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Speaker 1: PhD from Oxford on his studies of China, and most

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Speaker 1: importantly he is the new Ambassador of Australia to the

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Speaker 1: United States. The former Prime Minister of the nation. Kevin

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Speaker 1: Rudd joins us this morning, of course a commitment to

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Speaker 1: the Eurasia Group, pushing UH ten years. Dr Rudd, I've

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Speaker 1: never called you that, Dr Rudd. Thank you so much

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Speaker 1: for joining us today. What is the level of power

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Speaker 1: of ge the opacity that Ian Bremer talks about when

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Speaker 1: we talk of China. What is your knowledge or perspective

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Speaker 1: of the power of presidency? Well, great to be with you.

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Speaker 1: I should correct the record slightly. I'm not yet the

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Speaker 1: Australia ambass the United States that happens in March this year.

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Speaker 1: I'm still president of the urge of society three months

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Speaker 1: before I turned into a pumpkin. That's why I'm talking

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Speaker 1: on your program. Bottom line, in terms of Chikin Pings

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Speaker 1: as follows, he is numerous numero duo and numero tray

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Speaker 1: in the Chinese political system. And if he wanted any

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Speaker 1: evidence of that, you look at the twentieth Party Congress

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Speaker 1: where anyone who did not come from his group within

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Speaker 1: the party was given an exit pass, and instead we

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Speaker 1: had four people elevated to the POLP euro who will

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Speaker 1: who are virtually lifelong career colleagues, friends and supporters of

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Speaker 1: Hi Jinping, so his authority is great. However, this policy

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Speaker 1: you turn on zero COVID, which was actually cute it

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Speaker 1: on seven December, will raise a whole series of questions

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Speaker 1: in Chinese political circles about the fallibility of Chi Jan

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Speaker 1: Pain's political judgments. And so therefore that does create a

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Speaker 1: dent in the armor for the long term. I look

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Speaker 1: Ian Bremer at this and Kevin Rudd turning into a

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Speaker 1: pumpkin and March is part of the issue. You can

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Speaker 1: speak freely, what is that we have an allied response

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Speaker 1: in Europe, we have an understanding of how to respond

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Speaker 1: to Putin. I don't perceive an allied response from Australia

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Speaker 1: up to Japan of the Pacific. Rim against China doesn't exist. Oh,

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Speaker 1: it exists. It's just no one's happy about it politically,

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Speaker 1: because every ally understands that you don't want China to fail.

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Speaker 1: Every ally understands that they're not happy with China's political,

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Speaker 1: economic system and maximum she as Kevin and I describe it.

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Speaker 1: And also every ally understands that we need to keep

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Speaker 1: doing business with China even though we're concerned about what

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Speaker 1: are our present level of interdependence and coupling implies. We

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Speaker 1: know that we can't suddenly rip it up. Now, that

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Speaker 1: underlying reality, which does align the United States with the

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Speaker 1: entire G seven, is very different from the political statements

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Speaker 1: that need to be made by various leaders because no

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Speaker 1: one's happy with China. Scoring points off of China is

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Speaker 1: very easy to do. And in between those two things,

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Speaker 1: you have to find a policy where how are you

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Speaker 1: going to hit the Chinese in ways that are absolutely

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Speaker 1: essential to your national security without upsetting the entire relations

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Speaker 1: distinction of this in Kevin rod, this is so important

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Speaker 1: a question you'll answer now and not in April or May.

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Speaker 1: Kevin Rodd, I look at the United States and a

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Speaker 1: republican and democratic coalition against China. How should the United

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Speaker 1: States advocate to the broader Pacific rim if we're all

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Speaker 1: on the same page in our distrust of Beijing. Well,

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Speaker 1: let's look at in these terms. I'll challenge your premise

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Speaker 1: before decided there is no solidarity between in US allies

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Speaker 1: in Asia to it, Australia, Japan and the Republic of

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Speaker 1: Korea and partners as well such as India. And let's

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Speaker 1: call it the broad thrust of administration China strategy. And

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Speaker 1: I think frankly, Secretary of State Lincoln national Security Advisor

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Speaker 1: Sullivan have done a good job in hurting the cats

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Speaker 1: both in Asia and also frankly in Europe so far. However,

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Speaker 1: for the future, what is the missing element in US

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Speaker 1: grand strategy. It's called the economy stupid, and that is

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Speaker 1: you cannot continue to assume that there will be collective

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Speaker 1: solidarity on security questions, but on the economy, the United

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Speaker 1: States happy to throw some of its allies under a bus,

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Speaker 1: and for those reasons, the United States Congress needs to

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Speaker 1: embrace instead a different strategy which opens its markets more

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Speaker 1: to its allies in Asia and in Europe, despite the

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Speaker 1: overall overriding protection and sentiment of the US Congress and

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Speaker 1: political class more generally in that comments so important, you

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Speaker 1: want to jump in here with the time that we've got.

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Speaker 1: Why is there such an important state? And it's completely right.

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Speaker 1: It's very easy to not have a common economic policy

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Speaker 1: for the United States with Russia because we are literally

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Speaker 1: decoupling Russia from the entirety of the G seven economy.

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Speaker 1: We are not doing that with the Chinese. China is

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Speaker 1: extremely important to the U s economy, the German economy,

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Speaker 1: the French economy, Japanese economy, Australian economy. But we the

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Speaker 1: United States, do not have a trade policy. We don't

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Speaker 1: have one. And so, as Kevin said, unless Congress, the

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Speaker 1: Democrats the Republicans are prepared to actually speak coherently about

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Speaker 1: a long term US economic strategy. The national security policy

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Speaker 1: by itself doesn't get you a union in the time

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Speaker 1: that we've got left. Dr Rudd, very simply, or do

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Speaker 1: you demand a week dollar to assist the Pacific rim

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Speaker 1: well as a very polite as trade and we demand nothing.

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Speaker 1: But my commentary would be as follows that what we

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Speaker 1: want above all is to ensure that the economies of

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Speaker 1: East Asia remain market competitive and with greater and greater

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Speaker 1: levels of access to the American market. That lot therein

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Speaker 1: lies the future success or otherwise of US grand strategy.

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Speaker 1: You cannot have a strategy which has one arm tied

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Speaker 1: behind its back, namely trade the economy. You must in

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Speaker 1: fact have both wings flying. Otherwise this bird doesn't take

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Speaker 1: off Street Northwest and Washington. He will travel in March

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Speaker 1: the future Ambassador Australia to the United States, Kevin Rodden.

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Speaker 1: This is the lead of the top risk this year

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Speaker 1: for EUR Asia Group, and no surprise it is I'm

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Speaker 1: Mr Putin and in Russia with US Dr Bremer and

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Speaker 1: joining us as well someone with a European and Russia perspective.

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Speaker 1: Carl Build is the former Prime Minister of Sweden. They

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Speaker 1: are very much in the news, but with all sorts

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Speaker 1: of other public service to his continental your Pectter Bremer,

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Speaker 1: I want you to brief in here before we get

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Speaker 1: to uh, Carl Build, there is an understanding of Finland

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Speaker 1: and Sweden on down to Turkey. This border which you've

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Speaker 1: talked about at your raise, your group for years. What

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Speaker 1: is that border? That what that Eastern Front, whatever you

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Speaker 1: want to call it? What does that view look like

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Speaker 1: from a rogue state of Moscow, a roadue state of Russia. Yeah,

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Speaker 1: well it looks a lot worse if you're a rogue state,

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Speaker 1: if you find the present global order unacceptable, and if

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Speaker 1: you find that you're being humiliated through acts of your

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Speaker 1: own um and and trying to get yourself into a

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Speaker 1: better position. What it means is that NATO is seen

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Speaker 1: as aggressive, It is expanding, it is more forward deployed,

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Speaker 1: and Ukraine, a non NATO country, increasingly has the best supplied,

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Speaker 1: best deployed best trained, best intelligence of any military, vast

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Speaker 1: capacity of any military on the ground in Europe. It

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Speaker 1: could not have gone worse for former President Putin. And

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Speaker 1: that border only looks more problematic when you, as Russia

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Speaker 1: do not have any military strategy to countenance it. Summary

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Speaker 1: from your Asia group there to go to Carl Built again,

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Speaker 1: the former Prime Minister of Sweet Mr Mill, thank you

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Speaker 1: so much for joining Bloomberg Surveillance today, Carl Built. How

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Speaker 1: alone is Vladimir Putin? I think he's increasingly loan. I

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Speaker 1: think we should understand that the decision that he took

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Speaker 1: contemporary the fourth last year to launch this particular war

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Speaker 1: was a decision taken by him. I think it was

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Speaker 1: a very very close circle around him that was fully

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Speaker 1: aware of his intentions, and of course that decision was

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Speaker 1: then god doingly accepted by a lot of the Moscow elites. However,

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Speaker 1: you a phrase that in the belief that he would

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Speaker 1: actually succeed. But what has been happening since then is

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Speaker 1: of course that he has gradually failed, failed with the

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Speaker 1: one part of the strategy of another. And that means,

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Speaker 1: in my opinion, that is increasingly isolated in Moscow, without

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Speaker 1: that necessarily being an active opposition as it yet, but

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Speaker 1: a lot of uneasiness around him can't built the tension

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Speaker 1: that Mr Putin enjoys and likes, say personified and you're

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Speaker 1: Sweden and Turkey. The distance from Sweden to Turkey has

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Speaker 1: been noted throughout this war. How did the allies coalesced

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Speaker 1: around one voice? What is the process this year to

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Speaker 1: rebut this rogue state? Well, I think the last year

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Speaker 1: has been and I think you'll see continuation of this

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Speaker 1: year very impressive in terms of European actual solidarity and

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Speaker 1: trans Atlantic bonds. I don't think. I'm very certain that

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Speaker 1: put had not counted on that. He had counted on

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Speaker 1: the Americans not being too engage following what happened in Afghanistan.

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Speaker 1: He had counted on the on the Eupeians being divided,

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Speaker 1: which sometimes happens, and he had counted on the Ukrainians

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Speaker 1: not being into video that in supporting the Independent on

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Speaker 1: all of these accounts, he was fundamentally wrong, and now

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Speaker 1: he's gradually paying the price. What do you need from

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Speaker 1: our president buying from secretary of state? Blanket from a

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Speaker 1: new American, particularly with the American politics, it's new here

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Speaker 1: into a presidential campaign. What do you need from America

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Speaker 1: to steal for a long war? And they continued American support,

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Speaker 1: both in political and military and financial terms, is very important.

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Speaker 1: The European and American support is now roughly equal, but

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Speaker 1: on the military side, the American support is of course

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Speaker 1: much more important. And the political leadership that has to

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Speaker 1: give be given by the President of the White House

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Speaker 1: has been important in order to bibilize global opinion. And

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Speaker 1: we sincerely hope that that will and our indications of

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Speaker 1: the country that that would continue to be the case

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Speaker 1: to do this implet deal that is no ahead of

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Speaker 1: US Ian Bremer we do. We deal with someone there

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Speaker 1: who's just still in the pragmatic reality of European politics.

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Speaker 1: I want to dovetail that with a new movie that's

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Speaker 1: coming out, All Quiet on the Western Front, another treatment

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Speaker 1: of a classic book, a classic movie from another time.

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Speaker 1: How can America assist Europe if a large part of

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Speaker 1: America really doesn't want to be involved in Europe like

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Speaker 1: we didn't want to be involved in the first American

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Speaker 1: l en is making its way to Germany today. The

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Speaker 1: United States is doing an enormous amount there by far

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Speaker 1: the biggest military supporters of Ukraine. In the world today,

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Speaker 1: and American technology companies by far the most important national

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Speaker 1: security supporters of Ukraine in the digital space, in the cyberspace,

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Speaker 1: in the virtual space. That's enormously important too. That's not

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Speaker 1: being paid for by the American taxpayer. Now you put

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Speaker 1: all of that together, the risk in three is not

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Speaker 1: that it falls apart. It's not going to fall apart

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Speaker 1: this year. The risk is that Putin increasingly loseng on

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Speaker 1: the ground from a national security perspective, of a military

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Speaker 1: respective and economic respective, and diplomatic expective, with no friends,

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Speaker 1: becomes like a global Iran. He he is the most dangerous,

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Speaker 1: most powerful rogue actor that the planet has seen in

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Speaker 1: your and my lifetimes. And his willingness to go after NATO,

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Speaker 1: to use a symmetric attacks when nothing on the ground

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Speaker 1: or even in the air increasingly works against the well

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Speaker 1: defended Ukraine. That's the risk of Trump get out front

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Speaker 1: of this by questioning NATO and their commitment to their

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Speaker 1: investment in NATO. Was Trump ahead on this, he he

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Speaker 1: helped Putin believe that there would not be a united response.

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Speaker 1: Trump's America first helped lead to Macron's more uh rhetorical

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Speaker 1: strategic autonomy for France and saying that NATO was brain dead.

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Speaker 1: If you're Vladimir Putin after four years of Trump, you

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Speaker 1: increasingly believe for reasons that Carl mentioned that the United

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Speaker 1: States and the Europeans wouldn't care about Ukraine, we need

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Speaker 1: to consider this further here, Carl Bill, thank you so

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Speaker 1: much for joining us. The former Prime Minister of Sweden.

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Speaker 1: We'd really like to get you on surveillance fire more.

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Speaker 1: It's about many many other topics that you see of

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Speaker 1: those top ten risks, including a focus on energy and

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Speaker 1: a focus on technology this year as well. Not even

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Speaker 1: mentioned this morning is Iran, which I think is exceptionally

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Speaker 1: interesting and ties in dovetails in to what we see

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Speaker 1: in Russia and China. Is uh. We do another next

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Speaker 1: coming days. We'll give you coverage on this and very

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Speaker 1: importantly will drill down to some of those top ten

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Speaker 1: risks that are a bit different. We have a perfect

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Speaker 1: guest for that right now, Marcha sha k is at

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00:25:56,520 --> 00:26:02,040
Speaker 1: Stanford University. That barely describes her infinitive expert on thinking

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00:26:02,280 --> 00:26:06,320
Speaker 1: about technology and what it means for her Europe and

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Speaker 1: far more, what it means for all of us around

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Speaker 1: this world. And professor, thank you so much for joining

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00:26:11,560 --> 00:26:16,320
Speaker 1: us this morning. We have seen the use of technology

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00:26:16,440 --> 00:26:20,000
Speaker 1: in the war in Ukraine, the speed of information and

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00:26:20,040 --> 00:26:23,239
Speaker 1: for that matter, the use of technology as part of

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00:26:23,320 --> 00:26:29,600
Speaker 1: military operations. After what we witnessed in two thousand twenty two,

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00:26:30,040 --> 00:26:35,359
Speaker 1: this time are we tech different? Is this time tech different? Well,

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00:26:35,359 --> 00:26:38,080
Speaker 1: we see an acceleration of the use of technology in

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00:26:38,119 --> 00:26:42,240
Speaker 1: almost all aspects of our society. You mentioned the ongoing war,

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00:26:42,920 --> 00:26:46,879
Speaker 1: the unjust war in Ukraine waged by Russia, where technology

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00:26:46,880 --> 00:26:50,359
Speaker 1: plays a role cleverly used by the Ukrainians, but also

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00:26:50,640 --> 00:26:53,520
Speaker 1: when it comes to efforts to cause harm through cyber

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00:26:53,640 --> 00:26:57,960
Speaker 1: text on on the Russian parts. We should really prompt

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00:26:58,080 --> 00:27:01,800
Speaker 1: us to ask ourselves when do wars really start? Is

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00:27:01,800 --> 00:27:06,240
Speaker 1: it when tanks roll over physical borders as Russia has done,

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00:27:06,680 --> 00:27:11,160
Speaker 1: or is it when civilian infrastructure, critical infrastructure is targeted

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00:27:11,200 --> 00:27:15,280
Speaker 1: with cyber attacks, which we've seen for much much longer

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00:27:15,680 --> 00:27:21,159
Speaker 1: than since February two. Then there have been remarkable events

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00:27:21,160 --> 00:27:24,439
Speaker 1: in the last year. Of course, Elon Musk owning Twitter

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00:27:24,520 --> 00:27:27,280
Speaker 1: now and and using it as his personal playground, it

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00:27:27,359 --> 00:27:31,480
Speaker 1: seems breakthroughs in generative AI, and some of you may

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00:27:31,520 --> 00:27:34,359
Speaker 1: have been playing with that over the holidays. You know,

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00:27:34,440 --> 00:27:38,560
Speaker 1: those those chat bots that can help generate texts. I

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00:27:38,600 --> 00:27:42,160
Speaker 1: know some students are trying to have their homework being

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00:27:42,160 --> 00:27:45,239
Speaker 1: done for them. But all the all the fun and

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00:27:45,280 --> 00:27:48,320
Speaker 1: play with those new applications of a I can't really

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00:27:48,359 --> 00:27:52,800
Speaker 1: disguise the new risks that these AI applications also bring

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00:27:52,960 --> 00:27:58,600
Speaker 1: for spreading disinformation or more sophisticated span for example March.

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00:27:58,760 --> 00:28:01,160
Speaker 1: I can tell you from your that there's an American

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00:28:01,200 --> 00:28:05,360
Speaker 1: tradition to stand for university in Palo Alto for students

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00:28:05,400 --> 00:28:08,760
Speaker 1: to figure out how technology can do their homework. There's

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00:28:08,800 --> 00:28:12,480
Speaker 1: a history of that, to say the least, let me

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00:28:12,600 --> 00:28:15,199
Speaker 1: talk Let me talk about and this is cyber in

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00:28:15,280 --> 00:28:19,520
Speaker 1: sixty seconds, what you're doing with Dr Bremer at Eurasia,

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00:28:19,560 --> 00:28:23,240
Speaker 1: after what we've seen with Sam Bankman, free binance and all,

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00:28:23,320 --> 00:28:25,800
Speaker 1: and what we see in Europe our fear of cyber

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00:28:26,480 --> 00:28:31,840
Speaker 1: Do our institutions have control of technology or is it

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00:28:31,880 --> 00:28:36,480
Speaker 1: in this reality is uncontrolled as we all feel well,

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00:28:36,520 --> 00:28:39,360
Speaker 1: the question of control is a political choice. I think

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00:28:39,360 --> 00:28:41,720
Speaker 1: that that is a very important thing to keep in mind.

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00:28:42,280 --> 00:28:45,560
Speaker 1: In Europe, the choice has been made to invest in

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00:28:45,680 --> 00:28:53,600
Speaker 1: regulatory initiatives, innovations, new ways of having oversight, transparency and accountability,

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00:28:53,640 --> 00:28:56,200
Speaker 1: but in the United States not as much. And I

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00:28:56,240 --> 00:28:59,920
Speaker 1: do think that the whole FTX meltown, but also Elon

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00:29:00,080 --> 00:29:04,680
Speaker 1: Musk on Twitter beg the question will Congress finally step

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00:29:04,760 --> 00:29:07,480
Speaker 1: up an act? Well, I mean, this is so important

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00:29:07,480 --> 00:29:09,240
Speaker 1: and you know, let me let me ask you. I

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00:29:09,280 --> 00:29:11,720
Speaker 1: need to make some headlines here on on a slow

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00:29:11,800 --> 00:29:17,720
Speaker 1: Tuesday morning, MARCHA. Can Europe halt Elon musk experience at Twitter?

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00:29:18,160 --> 00:29:23,240
Speaker 1: Does Europe have the regulatory will to say to Mr Musk, No,

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00:29:24,120 --> 00:29:29,240
Speaker 1: that's not acceptable behavior. You can't do that in Europe. Absolutely.

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00:29:29,440 --> 00:29:32,920
Speaker 1: The laws that apply in Europe will apply to Elon

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00:29:33,000 --> 00:29:36,280
Speaker 1: Musk and and all other CEOs of tech companies as well.

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00:29:36,760 --> 00:29:40,600
Speaker 1: So when he decides that he would like to, for example,

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00:29:40,640 --> 00:29:44,200
Speaker 1: allow the spreading of hate speech or other kinds of

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00:29:44,240 --> 00:29:47,640
Speaker 1: harmful content, if it's against EU law, he will not

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00:29:47,760 --> 00:29:50,120
Speaker 1: be able to get away with it, just like that

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00:29:50,440 --> 00:29:55,360
Speaker 1: for European Internet users. He made these fines or questions

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00:29:55,400 --> 00:30:00,120
Speaker 1: about transparency over his algorithmic settings, and so the you

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00:30:00,320 --> 00:30:02,560
Speaker 1: has has taken a number of steps, some of the

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00:30:02,640 --> 00:30:07,280
Speaker 1: legislation still needing to enter into force, others already on

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00:30:07,320 --> 00:30:10,760
Speaker 1: the book, and must, like everyone else, will find out

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00:30:10,800 --> 00:30:13,440
Speaker 1: that the law applies to him as it does to everyone.

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00:30:14,000 --> 00:30:16,280
Speaker 1: Professor's shot, Well, I want to go to where Ian

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00:30:16,320 --> 00:30:18,520
Speaker 1: Bremer is in his ten Risks of this Year, which

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00:30:18,560 --> 00:30:22,120
Speaker 1: is a discussion of TikTok, And I am certain that

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00:30:22,200 --> 00:30:25,840
Speaker 1: every American listener and viewer want me to ask one

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00:30:26,000 --> 00:30:30,360
Speaker 1: simple question. Should we fear TikTok that our kids use?

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00:30:30,440 --> 00:30:34,000
Speaker 1: Should we look at TikTok whether it's used by undergraduates

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00:30:34,000 --> 00:30:37,520
Speaker 1: at Stanford down the little children. Should we fear that

507
00:30:38,080 --> 00:30:42,720
Speaker 1: it's some form of pipeline or conduit to institutions or

508
00:30:42,760 --> 00:30:46,680
Speaker 1: authorities in China. Yes, we should not be naive about it.

509
00:30:47,200 --> 00:30:49,480
Speaker 1: No one should be naive about the use of data,

510
00:30:49,760 --> 00:30:52,440
Speaker 1: the harvesting of data as they use social media, whether

511
00:30:52,480 --> 00:30:56,360
Speaker 1: it's on TikTok or Facebook or YouTube. And I think

512
00:30:56,760 --> 00:30:59,640
Speaker 1: for a long time it was American companies that dominated

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00:30:59,640 --> 00:31:02,560
Speaker 1: this mark it elsewhere. As a European I can say

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00:31:02,600 --> 00:31:08,840
Speaker 1: we were first flooded by Facebook, Instagram, YouTube, Snapchat. Now

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00:31:08,920 --> 00:31:11,760
Speaker 1: TikTok of course is very popular with kids here too,

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00:31:12,080 --> 00:31:14,600
Speaker 1: But the concern about where the data goes, who has access,

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00:31:14,680 --> 00:31:17,960
Speaker 1: what kind of profiles can be built about our children,

518
00:31:18,280 --> 00:31:21,880
Speaker 1: about ourselves. What might these be used for that is

519
00:31:21,880 --> 00:31:25,720
Speaker 1: not all about fun dances and jokes and and snappy videos.

520
00:31:25,840 --> 00:31:28,920
Speaker 1: Is something that I really hope everybody will make time

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00:31:29,000 --> 00:31:34,600
Speaker 1: to look into, because incident after incident reveals that misuse

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00:31:34,600 --> 00:31:39,560
Speaker 1: of data, commercial harvesting and selling of data is leading

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00:31:39,560 --> 00:31:44,160
Speaker 1: to all kinds of malign uses, whether it is commercially driven,

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00:31:44,240 --> 00:31:50,160
Speaker 1: politically driven, or actually criminally driven. And so there's just really,

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00:31:50,200 --> 00:31:53,520
Speaker 1: I hope in no more room for naive day about

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00:31:53,600 --> 00:31:58,240
Speaker 1: how data is used. Blistering Mary, thank you so much

527
00:31:58,240 --> 00:32:01,600
Speaker 1: for Stanford University and far more her public service. UH

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00:32:01,720 --> 00:32:06,800
Speaker 1: to European political systems. Can't say enough about that. This

529
00:32:06,880 --> 00:32:10,680
Speaker 1: is the Bloomberg Surveillance Podcast. Thanks for listening. Join us

530
00:32:10,720 --> 00:32:14,480
Speaker 1: live weekdays from seven to ten am Eastern on Bloomberg

531
00:32:14,560 --> 00:32:18,400
Speaker 1: Radio and on Bloomberg Television each day from six to

532
00:32:18,520 --> 00:32:23,200
Speaker 1: nine am for insight from the best in economics, finance, investment,

533
00:32:23,320 --> 00:32:28,360
Speaker 1: and international relations. And subscribe to the Surveillance Podcast on

534
00:32:28,440 --> 00:32:32,240
Speaker 1: Apple podcast, SoundCloud, Bloomberg dot com, and of course on

535
00:32:32,360 --> 00:32:36,480
Speaker 1: the terminal. I'm Tom Keene and this is Bloomberg