WEBVTT - Surveillance: Eurasia's Top 2023 Risks 0:00:05.120 --> 0:00:09.200 Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane. Along 0:00:09.200 --> 0:00:13.200 with Jonathan Ferrell and Lisa Bramowitz Jaily, we bring you 0:00:13.280 --> 0:00:18.600 insight from the best and economics, finance, investment, and international relations. 0:00:18.960 --> 0:00:23.799 Find Bloomberg Surveillance on Apple Podcast, SoundCloud, Bloomberg dot Com, 0:00:23.920 --> 0:00:30.760 and of course, on the Bloomberg terminal. Tom Kate with 0:00:30.880 --> 0:00:33.040 Im Brema. If you write a great the founder in President, 0:00:33.280 --> 0:00:36.280 you write a HQ. Morning Tom, John only said good 0:00:36.280 --> 0:00:38.040 morning to you, and it is what we do at 0:00:38.040 --> 0:00:40.440 the beginning of the year. We start strong with the 0:00:40.479 --> 0:00:42.800 top risks of your Asia group. It is a must. 0:00:42.800 --> 0:00:46.680 Reid twenty seven pages of brilliance. Far too optimistic this 0:00:46.760 --> 0:00:49.880 year on the comparative strength of American joining us with 0:00:49.960 --> 0:00:53.680 a brief throughout surveillance this morning. Ian Brehmer, Bill Dudley 0:00:53.680 --> 0:00:56.160 will join us on a divided America. Will do that 0:00:56.200 --> 0:00:59.000 in a bit, but right now not a divided China. 0:00:59.480 --> 0:01:02.920 G is at maximum power? Does it give way in 0:01:02.960 --> 0:01:06.920 two thousand three? Does this power after that Congress? Dr 0:01:06.959 --> 0:01:10.160 Bremer doesn't have it? Doesn't Uh. I'm gonna be with you, Tom, 0:01:10.160 --> 0:01:11.880 Happy New Year to you. It's always good to be 0:01:11.959 --> 0:01:14.560 kicking this off with you, Um, you know, there's no 0:01:14.640 --> 0:01:18.480 question that both for China as the second largest economy 0:01:18.520 --> 0:01:20.680 in the world, but also with she jun Ping having 0:01:20.680 --> 0:01:24.240 consolidated so much power in his hands and using it 0:01:24.280 --> 0:01:28.160 in ways that are capricious and are not in any 0:01:28.200 --> 0:01:32.560 way transparent, the global economy has never experienced anything like that, 0:01:32.560 --> 0:01:37.720 that level of uncertainty in the persona of one human being. 0:01:37.959 --> 0:01:41.160 We've we've seen it with the decision to do a 0:01:41.200 --> 0:01:46.480 complete degree bothas with the pandemic and zero COVID. We've 0:01:46.560 --> 0:01:49.920 seen it with a trillion dollars off of market value 0:01:49.920 --> 0:01:52.880 of Chinese tech stocks because she Jun pin decided that 0:01:52.880 --> 0:01:56.080 he was going to squeeze them. That level of uncertainty 0:01:56.120 --> 0:02:00.760 as China reopens their economy this year with no level 0:02:00.840 --> 0:02:02.920 of data that we used to get five ten years 0:02:02.920 --> 0:02:06.360 ago from the Chinese, even as an enormously concerning issue, 0:02:06.400 --> 0:02:08.240 this is important and this goes to your colleague in 0:02:08.240 --> 0:02:10.600 crime on this Elizabeth Economy. You see if ar now, 0:02:10.600 --> 0:02:14.800 a secretary of Ramando in Congress Economy told me years ago, 0:02:15.240 --> 0:02:19.160 don't overestimates power. Have we seen the maximum? Have we 0:02:19.440 --> 0:02:23.079 have we brought down? Do we see him weaken particularly 0:02:23.120 --> 0:02:26.000 off the COVID disaster. We see China weekend a little 0:02:26.040 --> 0:02:29.400 bit on the global stage. Certainly the lessons they're taking 0:02:29.400 --> 0:02:32.079 for Taiwan now that they've seen the United States and 0:02:32.160 --> 0:02:36.760 NATO in Ukraine. The lessons they're taking from concerns about 0:02:37.080 --> 0:02:42.040 American economic strength visa viast China on semiconductors for example, 0:02:42.080 --> 0:02:45.320 on the ability and willingness to impose export controls, and 0:02:45.360 --> 0:02:47.280 the fact that Chinese have sat on their hands. J 0:02:47.520 --> 0:02:50.200 and Ping is not in the same geopolitical position he 0:02:50.280 --> 0:02:54.760 was in before the pandemic started, but politically inside China 0:02:55.040 --> 0:02:58.680 he is only shrunk. And that is a that that 0:02:59.080 --> 0:03:02.560 is the nature of the risk. For are you lead 0:03:02.600 --> 0:03:05.720 with Russia in the top top ten risks? But how 0:03:05.840 --> 0:03:09.680 does China permeate out to all the other thinkings of 0:03:09.680 --> 0:03:12.280 the top risk this year? They just seem to dominate 0:03:12.360 --> 0:03:15.040 every conversation. Well, it's not that the Chinese do it, 0:03:15.160 --> 0:03:18.320 it's something very specific does which is the at the 0:03:18.360 --> 0:03:21.720 time that the United States democracy and economy is actually 0:03:21.760 --> 0:03:26.120 coming out more resilient and stronger than anyone out there 0:03:26.120 --> 0:03:30.200 would have imagined one to three years ago. Uh. We 0:03:30.240 --> 0:03:34.680 are seeing around the world a significant number of super 0:03:34.720 --> 0:03:39.760 empowered individuals who aren't getting great inputs from experts, who 0:03:39.960 --> 0:03:43.680 are able to act with impunity and are not getting 0:03:43.680 --> 0:03:46.440 what they want in various ways. On the global stage, 0:03:46.600 --> 0:03:50.680 Putin is one, She is another, The Iranian supreme leaders 0:03:50.680 --> 0:03:54.520 a third, and a small handful of tech center billionaires 0:03:54.560 --> 0:03:59.840 are a fourth, and those individuals are driving it. Disc 0:04:00.160 --> 0:04:03.960 menstrument amounts of global risk in the marketplace. Right now, 0:04:04.040 --> 0:04:06.720 let's look at your work G zero the concept of 0:04:06.800 --> 0:04:10.840 G twenty G seven down to a codified Bremer phrase 0:04:10.920 --> 0:04:15.520 G zero, or much more importantly, for Americans, us versus them, 0:04:15.960 --> 0:04:19.720 is the basic drama out there. How do we prosecute 0:04:19.760 --> 0:04:22.920 in two thousand twenty three a foreign policy with forget 0:04:22.960 --> 0:04:26.560 about Putin? How do we prosecute a foreign policy with 0:04:26.720 --> 0:04:31.160 China that gets something done twelve months from now? Well, 0:04:31.320 --> 0:04:35.000 two different ways. On the competitive side, you lean lean 0:04:35.160 --> 0:04:39.320 into American strength, which turns out to be national security 0:04:39.520 --> 0:04:42.520 broadly defined. So in the same way that the Germans 0:04:42.520 --> 0:04:44.880 have made mistakes for decades and the Europeans are at 0:04:44.960 --> 0:04:48.320 large and letting too much of their energy security lean 0:04:48.400 --> 0:04:52.080 on Russia, the Americans have let too much of our 0:04:52.360 --> 0:04:56.760 technology national security lean on Taiwan a hundred miles away 0:04:56.800 --> 0:05:00.320 from the mainland. Now, what we are now trying do 0:05:00.680 --> 0:05:03.200 not just the United States but with allies as well, 0:05:03.440 --> 0:05:05.440 and say we're going to redress that. We're going to 0:05:05.520 --> 0:05:10.120 redress it because of national security. So you, the Japanese, you, 0:05:10.240 --> 0:05:13.279 the South Korean's, you, the EU, the UK, the Canadians, 0:05:13.520 --> 0:05:15.400 You're all going to be with us on these export 0:05:15.440 --> 0:05:19.040 controls for anything the Chinese could use that would threaten 0:05:19.040 --> 0:05:22.320 our national security directly. And that's a policy that will 0:05:22.400 --> 0:05:26.240 align the G seven more broadly on China. That's important. 0:05:26.360 --> 0:05:29.359 But at the same time, Biden does not want to 0:05:29.400 --> 0:05:31.440 be in a cold war where the Chinese doesn't want 0:05:31.440 --> 0:05:35.240 to fight over Taiwan. He doesn't want the impact of 0:05:35.400 --> 0:05:39.640 competition on national security to bleed out into the broader 0:05:39.680 --> 0:05:43.400 economic interdependence of the For something new here, and I 0:05:43.440 --> 0:05:45.680 haven't gotten from Secretary Blank, and I don't think I've 0:05:45.720 --> 0:05:49.320 gotten from the Biden administration. Let's go back to something 0:05:49.360 --> 0:05:52.719 like the military industrial complex. This is back when Tulane 0:05:52.720 --> 0:05:57.119 had terrible football and they won a year ago. They 0:05:57.120 --> 0:05:59.400 you know, they stunned USC last night, which was great 0:05:59.400 --> 0:06:02.400 to see. But the shock of Tulane football. I'm looking 0:06:02.440 --> 0:06:06.080 for a shock in the Bremer world in your top risks. 0:06:06.120 --> 0:06:09.279 What's the thing our viewers and listeners have to look 0:06:09.360 --> 0:06:12.520 for six months in twelve months from now. Well, the 0:06:12.680 --> 0:06:17.680 shock that comes from a Chinese leader that is making 0:06:17.800 --> 0:06:20.000 policies and in the end of zero COVID. A lot 0:06:20.000 --> 0:06:22.200 of people thought that it was going to be incremental 0:06:22.720 --> 0:06:26.400 after he secured power in that for that unprecedented third 0:06:26.480 --> 0:06:28.560 term in the Party Congress, he didn't move away from 0:06:28.560 --> 0:06:31.560 at all. No, it shocked everyone. No one was expecting 0:06:31.560 --> 0:06:34.640 this even three months ago, even two months ago. Why 0:06:34.880 --> 0:06:39.040 in response to sudden demonstrations, the information got to him, 0:06:39.080 --> 0:06:41.920 and he, as an individual dictator of the second largest 0:06:41.960 --> 0:06:44.440 economy of the world, made that decision. We're going to 0:06:44.520 --> 0:06:48.760 see more uncertainty of that kind from the the most 0:06:48.760 --> 0:06:53.880 powerful individual on planet Earth. In three Putin is in 0:06:53.920 --> 0:06:55.880 a corner. I want to finish up here in China 0:06:55.920 --> 0:06:58.040 because we're gonna talk to Bill Dudley later. We're gonna 0:06:58.040 --> 0:07:01.679 talk to Mr RhoD of Australia later. Of course, focus focus, 0:07:01.760 --> 0:07:04.440 focus on Europe. We'll do that folks here in a 0:07:04.440 --> 0:07:07.560 bit with Carl Bill. Okay, fine, but is that the 0:07:08.000 --> 0:07:12.360 chemistry of China change. The history is it's city states 0:07:12.400 --> 0:07:15.160 like Shanghai and the new Hong Kong and all that 0:07:15.360 --> 0:07:20.360 versus a federal Beijing. Is that traditional calculus still in place. 0:07:20.400 --> 0:07:23.320 I haven't seen it since Mao. What's happening right now? 0:07:23.360 --> 0:07:25.960 And at the time of Mao, the enormous amount of 0:07:26.040 --> 0:07:29.080 uncertainty in China didn't matter to the global economy. They 0:07:29.080 --> 0:07:32.000 weren't interconnected to it, and they were vastly less powerful. 0:07:32.200 --> 0:07:35.240 We today have the same level of concentration of power 0:07:35.480 --> 0:07:38.960 that you had during some of the worst episodes chapters 0:07:38.960 --> 0:07:45.160 of Chinese history. To that concentration the autocratic power with confidence, 0:07:45.560 --> 0:07:50.120 but also with strategic patients. In other words, take shots 0:07:50.560 --> 0:07:54.960 when you know they are important with allies strategically. The 0:07:55.000 --> 0:07:58.280 new policy that you see from Biden is on semiconductors 0:07:58.280 --> 0:08:00.800 and export controls. That is contained a sea change, but 0:08:00.840 --> 0:08:03.640 in other areas of the economy, don't allow that to 0:08:03.680 --> 0:08:05.640 dictate what you're doing. One minute, here, we've got to 0:08:05.680 --> 0:08:07.720 get back to John and Lisa on the market's very 0:08:07.880 --> 0:08:10.960 very importantly. Here do you see a rekindling of what 0:08:10.960 --> 0:08:14.560 I'm gonna call from World War Two? MacArthur isolationism. No, no, 0:08:16.720 --> 0:08:18.880 don't want that. It's not that they don't want it. 0:08:18.880 --> 0:08:22.320 It's that everyone that throws money around in the United 0:08:22.360 --> 0:08:26.120 States strongly wants to ensure that doesn't happen. Furthermore, no 0:08:26.280 --> 0:08:28.680 American allies on the global stage. One it, not one, 0:08:29.040 --> 0:08:31.960 not one, Not the Japanese, not the Europeans. That bad 0:08:31.960 --> 0:08:34.480 in cares about that. Thirty seconds, John Ferrold demanded, I 0:08:34.480 --> 0:08:38.760 asked you this question. You nailed Merkel in Germany two 0:08:38.960 --> 0:08:43.000 risks ago, top ten risks ago. Did Merkel fail in Germany? 0:08:43.040 --> 0:08:45.800 Did Merkel? Is a reason where where we are in 0:08:45.840 --> 0:08:48.400 Europe right now to tease the Carl built? Is it 0:08:48.559 --> 0:08:53.000 because miracle failed? Merkel failed on energy policy and now 0:08:53.040 --> 0:08:55.640 they are paying the price for that. The unit the 0:08:55.679 --> 0:08:59.280 European Union is stronger today in part because of work 0:08:59.320 --> 0:09:00.960 that Merkel did. You have to give our a middle 0:09:00.960 --> 0:09:02.640 and grade that to twos. What we're gonna do with 0:09:02.760 --> 0:09:04.960 Dr Bremer here you raise your group, they celebrate the 0:09:05.840 --> 0:09:20.480 anniversary and very importantly their top ten risks stuff. William 0:09:20.559 --> 0:09:22.640 Dudley here, of course, formerly with a New York phone 0:09:22.679 --> 0:09:25.360 and ready for Bloomberg opinion Bill in your essay today 0:09:25.360 --> 0:09:29.000 for Bloomer Opinion. You focus on the fiscal part of 0:09:29.000 --> 0:09:31.880 the challenges here in the year four it is not 0:09:31.960 --> 0:09:36.400 so much a monetary impulse but a fiscal impulse. How 0:09:36.400 --> 0:09:39.480 will that change the Fed's work? Well, the MANTA policy 0:09:39.520 --> 0:09:41.600 is still gonna be tricky. How how high do you 0:09:41.640 --> 0:09:43.800 go for how long and how much slow down to 0:09:43.880 --> 0:09:47.559 you to tolerate. I think the fiscal is the big risk, 0:09:47.600 --> 0:09:50.960 so that it's not remarked on by virtually anybody. Uh, 0:09:51.040 --> 0:09:54.040 We're gonna end end this business cycle at a budget 0:09:54.040 --> 0:09:56.840 deficit of about five percent of GDP, which is a 0:09:56.880 --> 0:09:59.760 really horrible place to end the business cycle. Ad and 0:09:59.800 --> 0:10:02.240 that before we actually get all the costs associated with 0:10:02.320 --> 0:10:05.840 higher interest rates on debt service and the costs associated 0:10:05.840 --> 0:10:08.720 with social security and medicare as a baby blue generation retires. 0:10:08.800 --> 0:10:12.040 So I think the fiscal situation the US has deteriorated 0:10:12.120 --> 0:10:15.600 very sharply up to now. Markets have been extremely tolerant 0:10:15.640 --> 0:10:18.760 about this bill. Duddeley, I want to go back here, 0:10:18.800 --> 0:10:21.440 and it is a top ten risk of media, which 0:10:21.480 --> 0:10:24.200 is the gloom up there. The world's gonna end, and 0:10:24.200 --> 0:10:27.400 we're gonna have the recession to end all recessions. Take 0:10:27.520 --> 0:10:31.280 us back to your study of recession history and guessing 0:10:31.679 --> 0:10:35.440 at Berkeley years ago, can we actually guess a recession 0:10:35.800 --> 0:10:39.680 in two thousand twenty three, Well, recession is pretty likely 0:10:39.760 --> 0:10:41.600 just because of what the FIT has to do. The 0:10:41.600 --> 0:10:44.160 FED has to drive up the unemployment rates sufficiently to 0:10:44.280 --> 0:10:47.240 slow down the economy. Uh, to generate slack in the 0:10:47.320 --> 0:10:49.640 layer market, to bring wage inflation down to a level 0:10:49.679 --> 0:10:52.800 consistent with two percent inflation. But what's different this time, 0:10:52.840 --> 0:10:54.800 I think is that this if we have a recession, 0:10:54.800 --> 0:10:57.200 it's going to be a FED induced recession, and the 0:10:57.240 --> 0:11:01.360 FED can end the recession by subsequently see monitoring policy. 0:11:01.520 --> 0:11:03.319 I don't think that there's a big risk of a 0:11:03.840 --> 0:11:08.760 financial instability cataclysm that pushes the economy into a deep recession. 0:11:08.760 --> 0:11:11.160 I think this is a recession where the defense, you know, 0:11:11.240 --> 0:11:14.480 has the controls. When they need to ease, they can 0:11:14.520 --> 0:11:16.959 do so that the challenge for them is to not 0:11:17.080 --> 0:11:21.000 ease too soon. Uh. And but these in a timely way, Bill, don't. 0:11:21.080 --> 0:11:23.400 I've got time for one question, and I want to 0:11:23.400 --> 0:11:25.719 bring it over to Dr Bremer's study at you raise 0:11:25.800 --> 0:11:29.720 a group of our risks, and our division is Republican 0:11:30.080 --> 0:11:35.000 or Democrat. Monetary policy are they really all that much different? 0:11:35.360 --> 0:11:36.920 End of the day, it's really about how you treat 0:11:36.960 --> 0:11:39.600 the independence of the FED, what you actually criticize the 0:11:39.600 --> 0:11:42.360 FED through its actions, or do you leave it alone. 0:11:42.360 --> 0:11:46.280 The Democrats, really, starting with the Bill Clinton's administration, have 0:11:46.400 --> 0:11:49.040 been very hands off on the FED. Let the FED 0:11:49.120 --> 0:11:52.319 do their job. Republicans, especially under the Trump administration, and 0:11:52.360 --> 0:11:55.600 we're much more combative in terms of instructing the FIT 0:11:55.760 --> 0:11:58.199 what the FIT should do. I think the Democratic approach 0:11:58.240 --> 0:12:01.400 is better because it keeps some markets more calm, allows 0:12:01.400 --> 0:12:04.640 the FED to be more effective and translating its actions 0:12:04.640 --> 0:12:06.760 in terms of the tightening of financial conditions that it 0:12:06.800 --> 0:12:09.920 needs to have to control the growth rate of the 0:12:09.920 --> 0:12:12.360 econmy but there's a difference between the two parties in 0:12:12.480 --> 0:12:15.720 terms of how independent they treat the FIT. Too. Short 0:12:15.760 --> 0:12:18.040 of visit Bill Dudley, thank you so much for joining us, 0:12:23.480 --> 0:12:27.120 and beyond qualified to speak of the Pacific rim of 0:12:27.320 --> 0:12:32.320 his Australia and China. Is a gentleman, fluent Mandarin, a 0:12:32.400 --> 0:12:36.720 PhD from Oxford on his studies of China, and most 0:12:36.760 --> 0:12:40.320 importantly he is the new Ambassador of Australia to the 0:12:40.400 --> 0:12:43.920 United States. The former Prime Minister of the nation. Kevin 0:12:43.960 --> 0:12:46.600 Rudd joins us this morning, of course a commitment to 0:12:46.640 --> 0:12:50.840 the Eurasia Group, pushing UH ten years. Dr Rudd, I've 0:12:50.840 --> 0:12:53.280 never called you that, Dr Rudd. Thank you so much 0:12:53.520 --> 0:12:56.440 for joining us today. What is the level of power 0:12:56.559 --> 0:13:00.480 of ge the opacity that Ian Bremer talks about when 0:13:00.480 --> 0:13:04.479 we talk of China. What is your knowledge or perspective 0:13:04.679 --> 0:13:08.240 of the power of presidency? Well, great to be with you. 0:13:08.320 --> 0:13:10.880 I should correct the record slightly. I'm not yet the 0:13:10.880 --> 0:13:14.360 Australia ambass the United States that happens in March this year. 0:13:14.400 --> 0:13:17.080 I'm still president of the urge of society three months 0:13:17.120 --> 0:13:19.160 before I turned into a pumpkin. That's why I'm talking 0:13:19.200 --> 0:13:22.640 on your program. Bottom line, in terms of Chikin Pings 0:13:22.679 --> 0:13:29.120 as follows, he is numerous numero duo and numero tray 0:13:29.280 --> 0:13:32.199 in the Chinese political system. And if he wanted any 0:13:32.240 --> 0:13:34.840 evidence of that, you look at the twentieth Party Congress 0:13:34.960 --> 0:13:38.600 where anyone who did not come from his group within 0:13:38.640 --> 0:13:43.400 the party was given an exit pass, and instead we 0:13:43.480 --> 0:13:46.000 had four people elevated to the POLP euro who will 0:13:46.400 --> 0:13:50.640 who are virtually lifelong career colleagues, friends and supporters of 0:13:50.720 --> 0:13:57.040 Hi Jinping, so his authority is great. However, this policy 0:13:57.120 --> 0:14:00.360 you turn on zero COVID, which was actually cute it 0:14:00.400 --> 0:14:03.960 on seven December, will raise a whole series of questions 0:14:04.000 --> 0:14:08.240 in Chinese political circles about the fallibility of Chi Jan 0:14:08.320 --> 0:14:12.240 Pain's political judgments. And so therefore that does create a 0:14:12.320 --> 0:14:14.880 dent in the armor for the long term. I look 0:14:14.920 --> 0:14:17.760 Ian Bremer at this and Kevin Rudd turning into a 0:14:17.800 --> 0:14:20.000 pumpkin and March is part of the issue. You can 0:14:20.040 --> 0:14:23.400 speak freely, what is that we have an allied response 0:14:23.440 --> 0:14:25.920 in Europe, we have an understanding of how to respond 0:14:25.920 --> 0:14:29.640 to Putin. I don't perceive an allied response from Australia 0:14:29.720 --> 0:14:33.560 up to Japan of the Pacific. Rim against China doesn't exist. Oh, 0:14:33.600 --> 0:14:37.040 it exists. It's just no one's happy about it politically, 0:14:37.360 --> 0:14:41.320 because every ally understands that you don't want China to fail. 0:14:41.720 --> 0:14:45.560 Every ally understands that they're not happy with China's political, 0:14:45.640 --> 0:14:49.720 economic system and maximum she as Kevin and I describe it. 0:14:50.040 --> 0:14:53.400 And also every ally understands that we need to keep 0:14:53.400 --> 0:14:58.560 doing business with China even though we're concerned about what 0:14:58.800 --> 0:15:02.520 are our present level of interdependence and coupling implies. We 0:15:02.560 --> 0:15:05.200 know that we can't suddenly rip it up. Now, that 0:15:05.520 --> 0:15:09.520 underlying reality, which does align the United States with the 0:15:09.680 --> 0:15:14.000 entire G seven, is very different from the political statements 0:15:14.040 --> 0:15:16.480 that need to be made by various leaders because no 0:15:16.520 --> 0:15:19.160 one's happy with China. Scoring points off of China is 0:15:19.280 --> 0:15:21.960 very easy to do. And in between those two things, 0:15:22.160 --> 0:15:24.360 you have to find a policy where how are you 0:15:24.360 --> 0:15:26.240 going to hit the Chinese in ways that are absolutely 0:15:26.320 --> 0:15:29.960 essential to your national security without upsetting the entire relations 0:15:30.000 --> 0:15:32.600 distinction of this in Kevin rod, this is so important 0:15:32.600 --> 0:15:36.000 a question you'll answer now and not in April or May. 0:15:36.120 --> 0:15:39.640 Kevin Rodd, I look at the United States and a 0:15:39.720 --> 0:15:45.800 republican and democratic coalition against China. How should the United 0:15:45.880 --> 0:15:50.160 States advocate to the broader Pacific rim if we're all 0:15:50.200 --> 0:15:53.720 on the same page in our distrust of Beijing. Well, 0:15:53.760 --> 0:15:56.400 let's look at in these terms. I'll challenge your premise 0:15:56.480 --> 0:16:01.840 before decided there is no solidarity between in US allies 0:16:01.880 --> 0:16:06.120 in Asia to it, Australia, Japan and the Republic of 0:16:06.200 --> 0:16:10.040 Korea and partners as well such as India. And let's 0:16:10.040 --> 0:16:15.000 call it the broad thrust of administration China strategy. And 0:16:15.160 --> 0:16:18.520 I think frankly, Secretary of State Lincoln national Security Advisor 0:16:18.560 --> 0:16:21.920 Sullivan have done a good job in hurting the cats 0:16:21.960 --> 0:16:27.000 both in Asia and also frankly in Europe so far. However, 0:16:27.240 --> 0:16:29.880 for the future, what is the missing element in US 0:16:29.920 --> 0:16:33.840 grand strategy. It's called the economy stupid, and that is 0:16:33.920 --> 0:16:37.359 you cannot continue to assume that there will be collective 0:16:37.400 --> 0:16:41.600 solidarity on security questions, but on the economy, the United 0:16:41.640 --> 0:16:44.880 States happy to throw some of its allies under a bus, 0:16:45.360 --> 0:16:48.160 and for those reasons, the United States Congress needs to 0:16:48.200 --> 0:16:52.800 embrace instead a different strategy which opens its markets more 0:16:52.880 --> 0:16:56.360 to its allies in Asia and in Europe, despite the 0:16:56.400 --> 0:17:00.640 overall overriding protection and sentiment of the US Congress and 0:17:00.680 --> 0:17:04.000 political class more generally in that comments so important, you 0:17:04.040 --> 0:17:05.920 want to jump in here with the time that we've got. 0:17:05.960 --> 0:17:08.680 Why is there such an important state? And it's completely right. 0:17:08.880 --> 0:17:11.879 It's very easy to not have a common economic policy 0:17:11.920 --> 0:17:14.840 for the United States with Russia because we are literally 0:17:14.880 --> 0:17:18.640 decoupling Russia from the entirety of the G seven economy. 0:17:18.760 --> 0:17:21.440 We are not doing that with the Chinese. China is 0:17:21.480 --> 0:17:24.120 extremely important to the U s economy, the German economy, 0:17:24.119 --> 0:17:27.119 the French economy, Japanese economy, Australian economy. But we the 0:17:27.160 --> 0:17:29.560 United States, do not have a trade policy. We don't 0:17:29.600 --> 0:17:33.240 have one. And so, as Kevin said, unless Congress, the 0:17:33.320 --> 0:17:37.440 Democrats the Republicans are prepared to actually speak coherently about 0:17:37.440 --> 0:17:41.359 a long term US economic strategy. The national security policy 0:17:41.359 --> 0:17:43.040 by itself doesn't get you a union in the time 0:17:43.080 --> 0:17:46.480 that we've got left. Dr Rudd, very simply, or do 0:17:46.560 --> 0:17:52.879 you demand a week dollar to assist the Pacific rim 0:17:53.280 --> 0:17:56.280 well as a very polite as trade and we demand nothing. 0:17:56.800 --> 0:18:00.240 But my commentary would be as follows that what we 0:18:00.320 --> 0:18:04.399 want above all is to ensure that the economies of 0:18:04.480 --> 0:18:09.439 East Asia remain market competitive and with greater and greater 0:18:09.520 --> 0:18:13.760 levels of access to the American market. That lot therein 0:18:14.119 --> 0:18:18.399 lies the future success or otherwise of US grand strategy. 0:18:18.800 --> 0:18:21.880 You cannot have a strategy which has one arm tied 0:18:21.960 --> 0:18:25.119 behind its back, namely trade the economy. You must in 0:18:25.200 --> 0:18:29.080 fact have both wings flying. Otherwise this bird doesn't take 0:18:29.080 --> 0:18:33.000 off Street Northwest and Washington. He will travel in March 0:18:33.080 --> 0:18:36.560 the future Ambassador Australia to the United States, Kevin Rodden. 0:18:47.280 --> 0:18:50.040 This is the lead of the top risk this year 0:18:50.080 --> 0:18:52.520 for EUR Asia Group, and no surprise it is I'm 0:18:52.600 --> 0:18:56.000 Mr Putin and in Russia with US Dr Bremer and 0:18:56.080 --> 0:19:00.639 joining us as well someone with a European and Russia perspective. 0:19:00.680 --> 0:19:03.440 Carl Build is the former Prime Minister of Sweden. They 0:19:03.440 --> 0:19:05.560 are very much in the news, but with all sorts 0:19:05.560 --> 0:19:09.840 of other public service to his continental your Pectter Bremer, 0:19:09.880 --> 0:19:11.680 I want you to brief in here before we get 0:19:11.680 --> 0:19:15.600 to uh, Carl Build, there is an understanding of Finland 0:19:15.600 --> 0:19:18.720 and Sweden on down to Turkey. This border which you've 0:19:18.760 --> 0:19:21.240 talked about at your raise, your group for years. What 0:19:21.400 --> 0:19:24.480 is that border? That what that Eastern Front, whatever you 0:19:24.520 --> 0:19:27.040 want to call it? What does that view look like 0:19:27.359 --> 0:19:31.360 from a rogue state of Moscow, a roadue state of Russia. Yeah, 0:19:31.400 --> 0:19:34.240 well it looks a lot worse if you're a rogue state, 0:19:34.880 --> 0:19:38.440 if you find the present global order unacceptable, and if 0:19:38.480 --> 0:19:41.640 you find that you're being humiliated through acts of your 0:19:41.640 --> 0:19:44.720 own um and and trying to get yourself into a 0:19:44.760 --> 0:19:47.720 better position. What it means is that NATO is seen 0:19:47.760 --> 0:19:51.320 as aggressive, It is expanding, it is more forward deployed, 0:19:51.480 --> 0:19:56.680 and Ukraine, a non NATO country, increasingly has the best supplied, 0:19:57.080 --> 0:20:01.360 best deployed best trained, best intelligence of any military, vast 0:20:01.400 --> 0:20:05.239 capacity of any military on the ground in Europe. It 0:20:05.280 --> 0:20:08.919 could not have gone worse for former President Putin. And 0:20:08.960 --> 0:20:12.439 that border only looks more problematic when you, as Russia 0:20:12.520 --> 0:20:16.920 do not have any military strategy to countenance it. Summary 0:20:16.960 --> 0:20:19.520 from your Asia group there to go to Carl Built again, 0:20:19.560 --> 0:20:22.240 the former Prime Minister of Sweet Mr Mill, thank you 0:20:22.280 --> 0:20:26.440 so much for joining Bloomberg Surveillance today, Carl Built. How 0:20:26.520 --> 0:20:31.119 alone is Vladimir Putin? I think he's increasingly loan. I 0:20:31.160 --> 0:20:33.320 think we should understand that the decision that he took 0:20:33.359 --> 0:20:37.160 contemporary the fourth last year to launch this particular war 0:20:37.600 --> 0:20:39.399 was a decision taken by him. I think it was 0:20:39.440 --> 0:20:42.240 a very very close circle around him that was fully 0:20:42.280 --> 0:20:45.720 aware of his intentions, and of course that decision was 0:20:45.760 --> 0:20:49.119 then god doingly accepted by a lot of the Moscow elites. However, 0:20:49.160 --> 0:20:51.560 you a phrase that in the belief that he would 0:20:51.600 --> 0:20:55.000 actually succeed. But what has been happening since then is 0:20:55.040 --> 0:20:58.040 of course that he has gradually failed, failed with the 0:20:58.040 --> 0:21:01.080 one part of the strategy of another. And that means, 0:21:01.160 --> 0:21:06.439 in my opinion, that is increasingly isolated in Moscow, without 0:21:06.480 --> 0:21:10.480 that necessarily being an active opposition as it yet, but 0:21:11.280 --> 0:21:14.600 a lot of uneasiness around him can't built the tension 0:21:14.680 --> 0:21:19.400 that Mr Putin enjoys and likes, say personified and you're 0:21:19.480 --> 0:21:23.080 Sweden and Turkey. The distance from Sweden to Turkey has 0:21:23.119 --> 0:21:27.679 been noted throughout this war. How did the allies coalesced 0:21:27.840 --> 0:21:31.080 around one voice? What is the process this year to 0:21:31.240 --> 0:21:36.520 rebut this rogue state? Well, I think the last year 0:21:36.600 --> 0:21:39.119 has been and I think you'll see continuation of this 0:21:39.240 --> 0:21:44.359 year very impressive in terms of European actual solidarity and 0:21:44.400 --> 0:21:47.480 trans Atlantic bonds. I don't think. I'm very certain that 0:21:47.880 --> 0:21:50.879 put had not counted on that. He had counted on 0:21:51.080 --> 0:21:54.760 the Americans not being too engage following what happened in Afghanistan. 0:21:55.280 --> 0:21:58.600 He had counted on the on the Eupeians being divided, 0:21:58.680 --> 0:22:03.520 which sometimes happens, and he had counted on the Ukrainians 0:22:03.640 --> 0:22:07.200 not being into video that in supporting the Independent on 0:22:07.240 --> 0:22:11.880 all of these accounts, he was fundamentally wrong, and now 0:22:11.920 --> 0:22:14.840 he's gradually paying the price. What do you need from 0:22:15.000 --> 0:22:17.920 our president buying from secretary of state? Blanket from a 0:22:17.960 --> 0:22:22.360 new American, particularly with the American politics, it's new here 0:22:22.440 --> 0:22:26.600 into a presidential campaign. What do you need from America 0:22:27.080 --> 0:22:31.199 to steal for a long war? And they continued American support, 0:22:31.240 --> 0:22:34.560 both in political and military and financial terms, is very important. 0:22:34.960 --> 0:22:37.480 The European and American support is now roughly equal, but 0:22:37.600 --> 0:22:41.600 on the military side, the American support is of course 0:22:41.680 --> 0:22:45.080 much more important. And the political leadership that has to 0:22:45.080 --> 0:22:47.399 give be given by the President of the White House 0:22:47.400 --> 0:22:52.800 has been important in order to bibilize global opinion. And 0:22:53.680 --> 0:22:56.480 we sincerely hope that that will and our indications of 0:22:56.560 --> 0:22:59.160 the country that that would continue to be the case 0:22:59.200 --> 0:23:02.080 to do this implet deal that is no ahead of 0:23:02.160 --> 0:23:04.560 US Ian Bremer we do. We deal with someone there 0:23:04.600 --> 0:23:08.720 who's just still in the pragmatic reality of European politics. 0:23:08.760 --> 0:23:10.560 I want to dovetail that with a new movie that's 0:23:10.600 --> 0:23:13.680 coming out, All Quiet on the Western Front, another treatment 0:23:13.680 --> 0:23:16.760 of a classic book, a classic movie from another time. 0:23:17.240 --> 0:23:20.879 How can America assist Europe if a large part of 0:23:20.920 --> 0:23:25.119 America really doesn't want to be involved in Europe like 0:23:25.280 --> 0:23:28.600 we didn't want to be involved in the first American 0:23:28.680 --> 0:23:31.679 l en is making its way to Germany today. The 0:23:31.760 --> 0:23:34.920 United States is doing an enormous amount there by far 0:23:35.000 --> 0:23:38.119 the biggest military supporters of Ukraine. In the world today, 0:23:38.160 --> 0:23:41.080 and American technology companies by far the most important national 0:23:41.080 --> 0:23:44.720 security supporters of Ukraine in the digital space, in the cyberspace, 0:23:44.760 --> 0:23:47.080