1
00:00:00,080 --> 00:00:12,960
Speaker 1: Ye, Welcome to the Bloomberg Surveillance Podcast. I'm Tom Keane

2
00:00:13,480 --> 00:00:17,560
Speaker 1: jay Ley. We bring you insight from the best in economics, finance, investment,

3
00:00:18,000 --> 00:00:23,480
Speaker 1: and international relations. Find Bloomberg Surveillance on Apple Podcasts, SoundCloud,

4
00:00:23,600 --> 00:00:32,199
Speaker 1: Bloomberg dot Com, and of course on the Bloomberg. We

5
00:00:32,200 --> 00:00:35,000
Speaker 1: have always taken great pride in our economics at Bloomberg

6
00:00:35,040 --> 00:00:38,320
Speaker 1: On the Economy and Bloomberg Surveillance. We've always covered the

7
00:00:38,360 --> 00:00:41,639
Speaker 1: Nobel Prize winners, those of mathematics and maybe things more

8
00:00:41,640 --> 00:00:44,480
Speaker 1: accessible with a certain care I look at the John

9
00:00:44,520 --> 00:00:48,000
Speaker 1: Bates Clark Award. My interview was Susan Ahey of years ago,

10
00:00:48,040 --> 00:00:51,919
Speaker 1: and of course familiar guests on surveillance, including Michael Spence,

11
00:00:52,320 --> 00:00:56,280
Speaker 1: Robert Schiller and Paul Krugman. It is rare that we

12
00:00:56,360 --> 00:00:59,920
Speaker 1: have somebody on who has a direct connection, so direct

13
00:01:00,440 --> 00:01:04,160
Speaker 1: is Villin Powder with Mr Nordhouse of Yale University. We

14
00:01:04,240 --> 00:01:07,240
Speaker 1: are so honored to have you here this morning. Here's

15
00:01:07,280 --> 00:01:11,440
Speaker 1: a kid at Cambridge out of the Netherlands who scared stiff.

16
00:01:11,480 --> 00:01:14,200
Speaker 1: You're sitting in the room. Nordhouse walks in and is

17
00:01:14,200 --> 00:01:17,760
Speaker 1: it correct to say Nordhouse jump started your career at

18
00:01:17,840 --> 00:01:20,039
Speaker 1: Yale University. I think he certainly got me into the

19
00:01:20,040 --> 00:01:22,560
Speaker 1: graduate program. Dad, but I had forgotten to take my

20
00:01:22,640 --> 00:01:25,160
Speaker 1: SA T s. You forgot to take your s A

21
00:01:25,280 --> 00:01:27,800
Speaker 1: T s. Some of our staff did as well. You

22
00:01:27,880 --> 00:01:31,720
Speaker 1: forgot to take your kid obviously very acute, very bright.

23
00:01:31,800 --> 00:01:33,840
Speaker 1: If you blow it, you forgot to take your s

24
00:01:33,920 --> 00:01:36,959
Speaker 1: A T s. And here's Nordhaus of Yale. He's written

25
00:01:37,000 --> 00:01:40,320
Speaker 1: the book on from Samuelson and all you claim what

26
00:01:40,400 --> 00:01:44,319
Speaker 1: was the Nobel Prize winner like forty years ago? It

27
00:01:44,360 --> 00:01:48,920
Speaker 1: was a great teacher. He talked in the microeconomics coose

28
00:01:48,960 --> 00:01:52,520
Speaker 1: and I was uh first and second year a student

29
00:01:52,960 --> 00:01:55,880
Speaker 1: and he just toss a very inspiring teacher within. This

30
00:01:56,000 --> 00:01:58,400
Speaker 1: is your remembrance of James Tobin. I mean, folks, this

31
00:01:58,520 --> 00:02:02,080
Speaker 1: links back now six seventy and eighty years. This is

32
00:02:02,120 --> 00:02:04,520
Speaker 1: what we love to do. Like Michael Spencer's work with

33
00:02:04,640 --> 00:02:08,520
Speaker 1: John Hicks years ago at Oxford, you wrote the definitive

34
00:02:08,560 --> 00:02:13,480
Speaker 1: Remembrance of James Tobin. Explain what Tobin in Nordhouse did

35
00:02:13,560 --> 00:02:19,080
Speaker 1: to bring Roberts Solo's economic growth forward bitty in a way.

36
00:02:19,800 --> 00:02:25,240
Speaker 1: Northousing Tobin in some important joint papers started modern environmental

37
00:02:25,280 --> 00:02:30,040
Speaker 1: economics as a integrated with growth theory is a limit

38
00:02:30,120 --> 00:02:34,119
Speaker 1: to growth. That's why so interesting to have Romer who

39
00:02:34,160 --> 00:02:39,440
Speaker 1: within touches growth theory, UH, basically reduced the role of

40
00:02:39,600 --> 00:02:45,239
Speaker 1: diminishing returns Tobin and Northhouse and Northousing. His later work

41
00:02:46,160 --> 00:02:51,080
Speaker 1: showed constraints on growth coming from the environmental side. So

42
00:02:51,160 --> 00:02:53,560
Speaker 1: much of this comes back to Robert Solo of fifty

43
00:02:53,680 --> 00:02:57,160
Speaker 1: seven Advent of Modern Growth. And then you go to

44
00:02:57,200 --> 00:02:59,760
Speaker 1: say from the London School of Economics, run on coast

45
00:02:59,800 --> 00:03:03,959
Speaker 1: with kids limitations as well. Now we're at a critical point.

46
00:03:04,080 --> 00:03:07,520
Speaker 1: Is the Nobel Committee trying to say something to the

47
00:03:07,560 --> 00:03:12,160
Speaker 1: elites into the academics about the immediacy of our limits

48
00:03:12,240 --> 00:03:18,239
Speaker 1: in environment I certainly, but interpreted that way, it's no coincidence.

49
00:03:18,320 --> 00:03:22,880
Speaker 1: I think that No, in a time when environmental issues,

50
00:03:23,160 --> 00:03:27,160
Speaker 1: Paris Club and all that are all over the front page,

51
00:03:27,320 --> 00:03:31,520
Speaker 1: that we get Nobel Prize for the father of modern

52
00:03:31,600 --> 00:03:35,960
Speaker 1: environmental economics, I mean, Francine, I think it's just extraordinary. Again,

53
00:03:36,000 --> 00:03:38,720
Speaker 1: it goes back to these linkages of academics of the

54
00:03:38,880 --> 00:03:43,240
Speaker 1: various schools and the trans atlantic sphere. Yeah, and Viln

55
00:03:43,360 --> 00:03:46,480
Speaker 1: we follow it very closely. People follow it very closely,

56
00:03:46,520 --> 00:03:49,840
Speaker 1: but you know, translate what this actually means for the

57
00:03:49,880 --> 00:03:53,920
Speaker 1: public at large. Will they have a better understanding of

58
00:03:54,080 --> 00:03:58,160
Speaker 1: I guess the crosshairs of environment and economics. That does

59
00:03:58,160 --> 00:04:01,200
Speaker 1: winning a Nobel Prize actually mean you can educate the

60
00:04:01,240 --> 00:04:03,640
Speaker 1: world to some of the things that you've discovered, or

61
00:04:03,680 --> 00:04:06,280
Speaker 1: is it only for the elite? Well, it gives you

62
00:04:06,320 --> 00:04:10,160
Speaker 1: a platform, right, It doesn't change the substance, of course

63
00:04:10,320 --> 00:04:15,720
Speaker 1: of what not Haus and Roma Road, but it gives

64
00:04:15,760 --> 00:04:18,800
Speaker 1: them a platform for which to address the general public.

65
00:04:19,400 --> 00:04:22,560
Speaker 1: And I think that especially I think from the point

66
00:04:22,560 --> 00:04:26,800
Speaker 1: of view of environmental economics, is immensely important because so

67
00:04:26,920 --> 00:04:30,200
Speaker 1: much nonsense is being spoken, especially in this country, about

68
00:04:30,320 --> 00:04:34,080
Speaker 1: environmental issues from high that it's important that somebody has

69
00:04:34,120 --> 00:04:39,000
Speaker 1: actually done the work, done the hard analysis, study the facts,

70
00:04:39,200 --> 00:04:42,120
Speaker 1: as well as trying to put together a coherent theories

71
00:04:42,520 --> 00:04:46,920
Speaker 1: that that person be listened to. Thank you so much.

72
00:04:57,440 --> 00:05:00,560
Speaker 1: Protect the copyright of our guests. I I'm not going

73
00:05:00,600 --> 00:05:05,160
Speaker 1: to send you the Compass Point Research report their weekly

74
00:05:05,360 --> 00:05:10,839
Speaker 1: policy update. It is definitive. I'm trying to look forward

75
00:05:10,880 --> 00:05:15,360
Speaker 1: to what may, could, should, would get done in Washington.

76
00:05:15,640 --> 00:05:18,440
Speaker 1: And at the bottom of the first page today, Isaac

77
00:05:18,480 --> 00:05:23,680
Speaker 1: Boltanski and Lucas of US right on the new Supreme Court, Isaac,

78
00:05:23,720 --> 00:05:25,880
Speaker 1: wonderful to have you with us, and and and not

79
00:05:26,000 --> 00:05:28,240
Speaker 1: that I want to look back at at Kavanaugh and

80
00:05:28,279 --> 00:05:31,640
Speaker 1: all the angst and emotion that we see, and we'll

81
00:05:31,720 --> 00:05:34,839
Speaker 1: see as he takes his position on the Supreme Court.

82
00:05:35,360 --> 00:05:39,920
Speaker 1: But what is the compass point policy forward for our

83
00:05:40,000 --> 00:05:44,160
Speaker 1: judicial body? Sure, good morning, thanks for having me, Um,

84
00:05:44,400 --> 00:05:46,680
Speaker 1: you know in the morning. Note. What we try to

85
00:05:46,720 --> 00:05:49,840
Speaker 1: do is go through three different takeaways, and the first

86
00:05:49,880 --> 00:05:53,239
Speaker 1: one is relating to the Court itself, and with Judge

87
00:05:53,279 --> 00:05:56,359
Speaker 1: Cavanaugh now being sworn in over the weekend and to

88
00:05:56,440 --> 00:06:00,200
Speaker 1: be sworn in again today, Um, the court will have

89
00:06:00,400 --> 00:06:04,400
Speaker 1: a reliably conservative majority, and I think I think that's

90
00:06:04,400 --> 00:06:08,839
Speaker 1: going to prove to be consistently sympathetic for business interests,

91
00:06:09,160 --> 00:06:11,440
Speaker 1: and that's going to have a wide swath of impacts

92
00:06:11,480 --> 00:06:15,120
Speaker 1: on everything from E p A regulations to net neutrality

93
00:06:15,240 --> 00:06:20,840
Speaker 1: to consumer protection. What are the ramifications of the next

94
00:06:21,200 --> 00:06:24,680
Speaker 1: judge to policy? I don't mean the uproar, but now

95
00:06:24,720 --> 00:06:28,520
Speaker 1: we've had Gore such and now we've had Kavanaugh, and

96
00:06:28,560 --> 00:06:31,560
Speaker 1: there's gonna be a third judge. Let's assume at some

97
00:06:31,680 --> 00:06:36,240
Speaker 1: point it's nonlinear. What is the ramifications of a third

98
00:06:36,360 --> 00:06:40,640
Speaker 1: conservative judge. I think that it would be seismic. I

99
00:06:40,680 --> 00:06:43,320
Speaker 1: think that what we would have if there's a third

100
00:06:43,320 --> 00:06:46,480
Speaker 1: conservative judge that's put onto the court, what we will

101
00:06:46,520 --> 00:06:49,920
Speaker 1: have is a left who is going to predicate the

102
00:06:50,080 --> 00:06:55,240
Speaker 1: entirety of its judicial uh positioning on a call to

103
00:06:55,520 --> 00:06:59,760
Speaker 1: pack the court in and is a reminder, this is

104
00:07:00,000 --> 00:07:04,159
Speaker 1: thing that was tried by FDRY decade to go, and

105
00:07:04,360 --> 00:07:07,920
Speaker 1: it's something that's already game some degree of intellectual steam

106
00:07:07,960 --> 00:07:11,600
Speaker 1: within democrat I mean John, I I can't convey John

107
00:07:12,120 --> 00:07:15,680
Speaker 1: the difference here where the other nations, including a kingdom

108
00:07:16,320 --> 00:07:19,480
Speaker 1: what Mr Boltanski just mentioned, and Noah Feldman is the

109
00:07:19,600 --> 00:07:23,920
Speaker 1: expert at the packing of the FDR court. It's it's

110
00:07:24,120 --> 00:07:28,320
Speaker 1: stunning the next debate after the emotion and sensitivity of

111
00:07:28,360 --> 00:07:31,840
Speaker 1: the Supreme Court just does not resonate or translate outside

112
00:07:31,880 --> 00:07:34,960
Speaker 1: of America at all. I experienced that in London just

113
00:07:35,080 --> 00:07:38,000
Speaker 1: two weeks ago, Isaac. It does translate to the electorate

114
00:07:38,000 --> 00:07:41,120
Speaker 1: domestically in a massive way. I'm just wondering how high

115
00:07:41,240 --> 00:07:45,160
Speaker 1: up is this issue going into the midterms in a

116
00:07:45,200 --> 00:07:51,440
Speaker 1: month's time. It's it's intriguing in that there is a

117
00:07:51,440 --> 00:07:56,000
Speaker 1: poll that we track that assesses the quote enthusiasm gap

118
00:07:56,640 --> 00:08:01,080
Speaker 1: and Democrats had enjoyed a healthy margin and the enthusiasm

119
00:08:01,120 --> 00:08:05,840
Speaker 1: gap and back in July, before the Kavanaugh Supreme Court

120
00:08:05,920 --> 00:08:10,440
Speaker 1: fight began, Democrats enjoyed a ten point margin, and and

121
00:08:10,480 --> 00:08:14,440
Speaker 1: effectively that means that ten percentage points more of Democrats

122
00:08:14,720 --> 00:08:19,520
Speaker 1: describe their enthusiasm regarding the mid terms as as very important.

123
00:08:20,160 --> 00:08:22,960
Speaker 1: That was ten points back in July. That gap has

124
00:08:23,040 --> 00:08:26,520
Speaker 1: narrowed down to two points as of the beginning of October.

125
00:08:26,600 --> 00:08:29,360
Speaker 1: And what this tells me is that the Supreme Court,

126
00:08:29,480 --> 00:08:34,200
Speaker 1: unlike almost any other issue, can galvanize the political polls

127
00:08:34,200 --> 00:08:36,560
Speaker 1: in this country. So we sang Isaac to some extent,

128
00:08:36,600 --> 00:08:39,000
Speaker 1: the drama of the last couple of weeks might eventually

129
00:08:39,040 --> 00:08:42,760
Speaker 1: hit out the Democrats. I think that what our view

130
00:08:43,040 --> 00:08:47,679
Speaker 1: is is that it's the Kavanaugh site hurt the Democrats

131
00:08:47,720 --> 00:08:51,320
Speaker 1: in certain states. And here I'm talking about states where

132
00:08:51,920 --> 00:08:56,359
Speaker 1: there is net support for Judge Cavanaugh, and in particular

133
00:08:56,440 --> 00:09:02,560
Speaker 1: North Dakota, Missouri, possibly even mont In Florida, West Virginia, UM.

134
00:09:02,640 --> 00:09:06,720
Speaker 1: So it has hurt Democrats in those states, those battleground

135
00:09:06,760 --> 00:09:09,640
Speaker 1: Senate states. But I actually think it's helped democrats in

136
00:09:09,760 --> 00:09:12,920
Speaker 1: some of the most competitive House races because those are

137
00:09:12,920 --> 00:09:16,480
Speaker 1: in districts that are largely suburban. And I think because

138
00:09:16,520 --> 00:09:19,080
Speaker 1: of that divide, we have once again a mixed bag

139
00:09:19,120 --> 00:09:22,640
Speaker 1: politically where the kabin Off fight helps Democrats in the

140
00:09:22,679 --> 00:09:25,280
Speaker 1: House but hurts them in the Senate. Interesting, So is

141
00:09:25,280 --> 00:09:27,400
Speaker 1: that your base case to eyes that the House turns

142
00:09:27,480 --> 00:09:32,240
Speaker 1: but it doesn't turn in the Senate. So heading twenty nine,

143
00:09:32,240 --> 00:09:34,000
Speaker 1: we have twenty nine days, and I think all of

144
00:09:34,000 --> 00:09:37,280
Speaker 1: them know these days in politics we're living in dog years.

145
00:09:37,320 --> 00:09:39,520
Speaker 1: But twenty nine days out, the base case that we

146
00:09:39,600 --> 00:09:42,840
Speaker 1: have and that we assigned a se likelihood too, is

147
00:09:42,880 --> 00:09:45,760
Speaker 1: that the House will flip in the Senate will stay

148
00:09:45,760 --> 00:09:51,520
Speaker 1: in Republican hands. We're living in donkeys in politics right now,

149
00:09:52,360 --> 00:09:55,480
Speaker 1: we really are, well we are. Where does that leave you?

150
00:09:55,800 --> 00:09:58,520
Speaker 1: At least vet Bill is fully engaged in the election.

151
00:09:58,800 --> 00:10:02,400
Speaker 1: I mean, jump, Isaac. My dog is vet Bill, and

152
00:10:02,440 --> 00:10:08,720
Speaker 1: he's fully He's fully engaged as long as he's registered. Well,

153
00:10:08,800 --> 00:10:11,719
Speaker 1: vet Bill is registered, and I'm upset with him. He

154
00:10:11,800 --> 00:10:14,880
Speaker 1: registered is an independent. You know, I don't know which

155
00:10:14,880 --> 00:10:17,720
Speaker 1: way vet Bill is going on this. Uh, this is

156
00:10:17,720 --> 00:10:19,360
Speaker 1: in New York, folks. I don't know if it matters.

157
00:10:19,400 --> 00:10:22,240
Speaker 1: It's not like if vettmill is in Ohio he be canvased.

158
00:10:22,240 --> 00:10:24,680
Speaker 1: You know, Rob Portman would not be out there Center

159
00:10:24,760 --> 00:10:27,719
Speaker 1: Apartman would be out calling on Vet Bill Isaac. When

160
00:10:27,760 --> 00:10:30,559
Speaker 1: I look at policy, John Ferroll had a great insight

161
00:10:30,960 --> 00:10:34,920
Speaker 1: earlier about policy rollback. I mean, that's not gonna happen

162
00:10:35,360 --> 00:10:38,880
Speaker 1: with just a Democratic House, right, It's not. And I

163
00:10:38,920 --> 00:10:41,120
Speaker 1: think that this is important. The number one question I

164
00:10:41,160 --> 00:10:44,360
Speaker 1: get from from our clients these days is what will

165
00:10:44,440 --> 00:10:49,240
Speaker 1: happen if the Democrats take that answer is particular very little,

166
00:10:49,400 --> 00:10:53,280
Speaker 1: and the tax law will be uh intact until at

167
00:10:53,360 --> 00:10:58,280
Speaker 1: least one and more likely thereafter. And instead, all that

168
00:10:58,320 --> 00:10:59,960
Speaker 1: we're going to have to really get our arms or

169
00:11:00,000 --> 00:11:05,120
Speaker 1: ound is the slew of subpoenas and hearings and congressional

170
00:11:05,200 --> 00:11:08,960
Speaker 1: investigations that will come, which does have some bearing on

171
00:11:09,040 --> 00:11:13,320
Speaker 1: the pace of administrative regulatory changes. You know the alphabet

172
00:11:13,400 --> 00:11:16,080
Speaker 1: souper here in d C. Everything from CFPB to e

173
00:11:16,200 --> 00:11:20,120
Speaker 1: p a UM should expect subpoenas if the House flipped,

174
00:11:20,120 --> 00:11:23,960
Speaker 1: and that will slow down. Some of the administrative CBO

175
00:11:24,080 --> 00:11:27,280
Speaker 1: did their monthly report which I've skimmed through, and we

176
00:11:27,320 --> 00:11:29,360
Speaker 1: went John, is it just a round number from six

177
00:11:29,400 --> 00:11:31,199
Speaker 1: hundred billion up to seven and I think it was

178
00:11:31,240 --> 00:11:34,720
Speaker 1: a hundred and sixteen billion dollar lifting the deficit? Is

179
00:11:34,760 --> 00:11:39,160
Speaker 1: that a constraint on politicians after the election? I understand

180
00:11:39,240 --> 00:11:42,600
Speaker 1: before the election nobody cares. Are they actually gonna care

181
00:11:42,600 --> 00:11:45,920
Speaker 1: about the deficit and the lame Duck or the forward Congress?

182
00:11:46,800 --> 00:11:51,000
Speaker 1: I wish they should. It's it's demoralizing that policymakers don't,

183
00:11:51,080 --> 00:11:55,040
Speaker 1: but neither party has any interest in deficits when they're

184
00:11:55,040 --> 00:11:57,200
Speaker 1: in the majority. What does it mean for the president

185
00:11:57,280 --> 00:11:59,880
Speaker 1: Isaac and his policy coming out the other side of

186
00:11:59,920 --> 00:12:01,960
Speaker 1: the So if we go back to what I dare

187
00:12:01,960 --> 00:12:04,560
Speaker 1: say as normal, which is just by just of roadblocks

188
00:12:04,600 --> 00:12:06,640
Speaker 1: in Washington, d C. What does it mean for the

189
00:12:06,640 --> 00:12:10,160
Speaker 1: president and the kind of avenues that he pursues, Well,

190
00:12:10,320 --> 00:12:12,360
Speaker 1: he's going to have a choice, I think, And it's

191
00:12:12,559 --> 00:12:15,160
Speaker 1: it's on the one hand, there could be more of

192
00:12:15,200 --> 00:12:18,600
Speaker 1: an entrenchment, more of a focus on things that much

193
00:12:18,640 --> 00:12:21,240
Speaker 1: like President Obama said, he can do with his phone

194
00:12:21,320 --> 00:12:24,040
Speaker 1: and his pen. And so we start thinking about what

195
00:12:24,120 --> 00:12:27,280
Speaker 1: are the administrative avenues for change that can be done

196
00:12:27,320 --> 00:12:31,080
Speaker 1: simply and solely by the executive branch. So that's path

197
00:12:31,160 --> 00:12:35,520
Speaker 1: number one. Path number two, which is possible but not probable,

198
00:12:36,040 --> 00:12:40,360
Speaker 1: is that suddenly we see more of the freewheeling centrist

199
00:12:40,960 --> 00:12:45,200
Speaker 1: UH policy making apparatus that someone hoped, and we get

200
00:12:45,240 --> 00:12:49,000
Speaker 1: things like an infrastructure spending bill. I tend to think

201
00:12:49,040 --> 00:12:50,880
Speaker 1: that instead, what we're going to have as a president

202
00:12:51,000 --> 00:12:55,720
Speaker 1: that is inundated with subpoenas congressional investigations and decides to

203
00:12:55,800 --> 00:12:59,480
Speaker 1: move on administrative items. Isaac, thank you so much. Congratulations,

204
00:12:59,480 --> 00:13:03,000
Speaker 1: thank you much. Terrific brief, very clear inside Isaac Boltansky,

205
00:13:03,080 --> 00:13:15,719
Speaker 1: Compass Point Research. That's our next guest, John out of

206
00:13:15,760 --> 00:13:19,520
Speaker 1: the combine of Adam Post Monica Dubult, the Peterson Institute

207
00:13:19,520 --> 00:13:24,320
Speaker 1: for International Economics Senior Fellow, joins us. Now, Monica, let's

208
00:13:24,360 --> 00:13:26,640
Speaker 1: talk about something really interesting for me at least that's

209
00:13:26,640 --> 00:13:29,000
Speaker 1: happening at the moment, which is the world's second largest

210
00:13:29,000 --> 00:13:32,880
Speaker 1: economy is supporting growth. Um. The world's first largest economy

211
00:13:33,400 --> 00:13:38,680
Speaker 1: is continuing to raise interest rates. What breaks um? That's

212
00:13:38,679 --> 00:13:42,440
Speaker 1: a good question. UM. I'm not sure what breaks the

213
00:13:42,440 --> 00:13:47,520
Speaker 1: The the the the overall context is in the world

214
00:13:47,640 --> 00:13:50,720
Speaker 1: is currently all very strange because in the middle of

215
00:13:50,760 --> 00:13:53,520
Speaker 1: all this, we've got this trade war that we don't

216
00:13:53,520 --> 00:13:56,280
Speaker 1: know exactly what kind of implications it's going to have

217
00:13:56,360 --> 00:13:59,120
Speaker 1: for the global economy. On top of that, we have

218
00:13:59,520 --> 00:14:04,079
Speaker 1: invest there's wary of emerging markets because of rising interest

219
00:14:04,200 --> 00:14:07,160
Speaker 1: rates in the US and because of vulnerabilities UM in

220
00:14:07,200 --> 00:14:10,320
Speaker 1: certain parts of the world, notably Argentina and Turkey, but

221
00:14:10,400 --> 00:14:14,840
Speaker 1: other places to including Brazil, which um YouTube were just

222
00:14:14,920 --> 00:14:17,679
Speaker 1: mentioning a few minutes ago in terms of the presentational

223
00:14:17,840 --> 00:14:20,840
Speaker 1: election that took place yesterday. So there's a lot of

224
00:14:20,920 --> 00:14:23,720
Speaker 1: unknowns out there, a ton of unknowns out there. But

225
00:14:23,760 --> 00:14:26,280
Speaker 1: do you view the slowdown in Shina with something separate

226
00:14:26,640 --> 00:14:29,840
Speaker 1: from the triede story? Monitor into what degree I do?

227
00:14:30,000 --> 00:14:32,480
Speaker 1: I do view a view it as something separate from

228
00:14:32,520 --> 00:14:35,160
Speaker 1: the from the trade story. It's hard to say to

229
00:14:35,200 --> 00:14:38,080
Speaker 1: what degree, because we have a very hard time, very

230
00:14:38,200 --> 00:14:42,240
Speaker 1: very hard time as economists intricate into integrating the trade

231
00:14:42,280 --> 00:14:46,440
Speaker 1: stories with the overall mocroeconomic stories. I mean, basically, our

232
00:14:46,560 --> 00:14:51,200
Speaker 1: macroeconomic models are very are very um we can't quite

233
00:14:51,200 --> 00:14:54,760
Speaker 1: integrate our macroeconomic models with our trade models. So we

234
00:14:54,880 --> 00:14:57,560
Speaker 1: have a lot of difficulty quantifying the effects of one

235
00:14:57,560 --> 00:15:00,200
Speaker 1: on the other. But certainly there's impact and of the

236
00:15:00,240 --> 00:15:02,960
Speaker 1: great things here and it could be Brazil more commodity based,

237
00:15:03,040 --> 00:15:07,200
Speaker 1: or China is goods but the service sector. I mean,

238
00:15:07,280 --> 00:15:11,640
Speaker 1: all these dynamics are dealing with Almonica are amended or

239
00:15:11,760 --> 00:15:15,040
Speaker 1: adjusted because so much of the world now is a

240
00:15:15,080 --> 00:15:19,800
Speaker 1: growing service sector economy exactly exactly, And this is one

241
00:15:19,880 --> 00:15:24,600
Speaker 1: aspect that we have been struggling with, trying to understand

242
00:15:24,640 --> 00:15:29,320
Speaker 1: exactly how these different linkages between goods markets and services markets,

243
00:15:29,320 --> 00:15:34,280
Speaker 1: and in particular the services the services economy UM reacts

244
00:15:34,320 --> 00:15:36,200
Speaker 1: to all of the all of the things that are

245
00:15:36,240 --> 00:15:39,040
Speaker 1: currently taking place. What's the dynamic that you and this

246
00:15:39,160 --> 00:15:42,600
Speaker 1: of course goes with a heritage of Peterson and nick Larney.

247
00:15:42,640 --> 00:15:45,640
Speaker 1: What is the dynamic of a service sector trade debate

248
00:15:45,720 --> 00:15:50,520
Speaker 1: between China and the US and the US and China. Well,

249
00:15:50,560 --> 00:15:53,240
Speaker 1: that's a that's an excellent question. I mean, looking at

250
00:15:53,280 --> 00:15:56,960
Speaker 1: it from just what's been going on between China and

251
00:15:56,920 --> 00:16:00,240
Speaker 1: in the US UM, it seems like that's not being

252
00:16:00,280 --> 00:16:03,480
Speaker 1: really taken into account. We have been seeing tarroiffs back

253
00:16:03,520 --> 00:16:06,880
Speaker 1: and forth on goods UM. But obviously all of these

254
00:16:06,880 --> 00:16:09,120
Speaker 1: things are going to affect services at the end of

255
00:16:09,160 --> 00:16:11,560
Speaker 1: the day. And so the big question to me is

256
00:16:11,800 --> 00:16:15,040
Speaker 1: how much do we unhinge the services economy, and by

257
00:16:15,160 --> 00:16:17,960
Speaker 1: unhinging the services economy, how do we how much do

258
00:16:18,040 --> 00:16:21,120
Speaker 1: we unhinge the global macro economy? And Monica? I think

259
00:16:21,120 --> 00:16:22,960
Speaker 1: would be missed opportunity to have you on the program

260
00:16:23,000 --> 00:16:25,280
Speaker 1: and not talk about Brazil, given that I understand you

261
00:16:25,360 --> 00:16:30,040
Speaker 1: also run lain American Studies at Johns Hopkins University. Um,

262
00:16:30,080 --> 00:16:32,720
Speaker 1: can you walk us through Monica? What is happening in Brazil?

263
00:16:33,000 --> 00:16:36,160
Speaker 1: Just a very simplified version from where I'm sitting is

264
00:16:36,200 --> 00:16:40,520
Speaker 1: that we have a market friendly candidate in Bollsonaro. Is

265
00:16:40,520 --> 00:16:43,840
Speaker 1: that a market friendly candidate that can be consistent over

266
00:16:43,880 --> 00:16:46,600
Speaker 1: the next several years Because it's also understanding that he

267
00:16:46,600 --> 00:16:48,960
Speaker 1: actually admits he doesn't have much of an understanding of

268
00:16:49,000 --> 00:16:51,360
Speaker 1: economics and defaults to someone else on some of these

269
00:16:51,360 --> 00:16:55,320
Speaker 1: big issues. Well, here's where the strangeness of this election

270
00:16:55,400 --> 00:16:59,840
Speaker 1: comes in. So Bolsonardo has definitely caught the markets attention

271
00:17:00,000 --> 00:17:03,400
Speaker 1: as the market friendly candidate because of the person he

272
00:17:03,480 --> 00:17:07,600
Speaker 1: appointed or has seems to have appointed, at his economic chief,

273
00:17:07,680 --> 00:17:10,960
Speaker 1: so to speak. So the that person is a us

274
00:17:11,240 --> 00:17:14,960
Speaker 1: is a Chicago trained economist, an ultra liberal pro market

275
00:17:15,560 --> 00:17:20,600
Speaker 1: um person. But Mr Bilsonado his actual track record as

276
00:17:20,640 --> 00:17:23,439
Speaker 1: a deputy in the Lower House, where he's been for

277
00:17:23,480 --> 00:17:26,680
Speaker 1: the past twenty six plus years, is that he's been

278
00:17:26,760 --> 00:17:31,880
Speaker 1: voting consistently with the Workers Party with the pt UM.

279
00:17:31,960 --> 00:17:36,119
Speaker 1: He was actually one of the very vocal um anti

280
00:17:36,240 --> 00:17:39,920
Speaker 1: um stabilization plan Um, the Plan of real that was

281
00:17:39,960 --> 00:17:42,840
Speaker 1: put in place in the nineties to stabilize inflation. He

282
00:17:42,960 --> 00:17:46,800
Speaker 1: was vocally against that at the time, and he has

283
00:17:47,240 --> 00:17:52,320
Speaker 1: espoused views which are much more nationalistic and state intervention

284
00:17:52,520 --> 00:17:56,960
Speaker 1: in a lot of state interventionism then um then market

285
00:17:57,040 --> 00:17:59,720
Speaker 1: seem to realize at this point, which is kind of

286
00:17:59,720 --> 00:18:02,879
Speaker 1: straight because all these views are in public. So here's

287
00:18:02,920 --> 00:18:06,880
Speaker 1: the here's the catch twenty two question them the fact

288
00:18:06,920 --> 00:18:10,000
Speaker 1: that he has appointed an ultra liberal, pro pro market

289
00:18:10,040 --> 00:18:14,440
Speaker 1: economist as his economic chief. Does that mean that he's

290
00:18:14,480 --> 00:18:18,239
Speaker 1: actually going to delegate every single economic decision to this

291
00:18:18,280 --> 00:18:22,440
Speaker 1: guy as president? Given that he himself, Mr Bosonado has

292
00:18:22,520 --> 00:18:25,840
Speaker 1: quite the authoritarian streak, I think it's very hard to

293
00:18:25,880 --> 00:18:28,159
Speaker 1: wrap our minds around that. Well, Monocro would say, some

294
00:18:28,200 --> 00:18:30,359
Speaker 1: of the E M. Taurus and I hate to insult

295
00:18:30,400 --> 00:18:33,520
Speaker 1: some of the people that probably have got behind in

296
00:18:33,560 --> 00:18:36,960
Speaker 1: Brazil over the last week. They're sitting here thinking that

297
00:18:37,080 --> 00:18:39,639
Speaker 1: this is the view of Baltsonaro. Can I just put

298
00:18:39,680 --> 00:18:41,560
Speaker 1: it on the spot monitor and ask you the question

299
00:18:41,560 --> 00:18:44,480
Speaker 1: as to whether you think they are wrong? I do.

300
00:18:45,240 --> 00:18:47,920
Speaker 1: I do think it's really interesting, Tom, This is really

301
00:18:47,960 --> 00:18:50,280
Speaker 1: interesting because the market has really got behind this candidate

302
00:18:51,000 --> 00:18:52,960
Speaker 1: as if he is going to introduce an implement and

303
00:18:53,000 --> 00:18:57,200
Speaker 1: follow through on some very market friendly proposals. What does

304
00:18:57,240 --> 00:19:02,160
Speaker 1: their fiscal take? Finally, her mood, what is the fiscal

305
00:19:02,240 --> 00:19:05,240
Speaker 1: stance of Brazil? Can they afford on a debt and

306
00:19:05,359 --> 00:19:10,960
Speaker 1: a text revenue side to affect Bulson narrow policy? So

307
00:19:11,080 --> 00:19:15,480
Speaker 1: the fiscal situation is very dramatic. Um, the fiscal deficit,

308
00:19:15,560 --> 00:19:18,720
Speaker 1: the nominal deficit is pretty high at around a to

309
00:19:18,840 --> 00:19:21,440
Speaker 1: nine percent of GDP. There's a two and a half

310
00:19:21,480 --> 00:19:25,959
Speaker 1: primary deficit in place. Unless the situations fixed this, this

311
00:19:26,040 --> 00:19:29,680
Speaker 1: deficit is likely to rise over the medium term debt

312
00:19:29,720 --> 00:19:31,960
Speaker 1: to GDP at the moment, going by the i m

313
00:19:32,040 --> 00:19:36,200
Speaker 1: F methodology, which is different from the Brazilian Central Banks methodology,

314
00:19:36,240 --> 00:19:39,679
Speaker 1: obviously that one is lower um the figures lower, but

315
00:19:39,760 --> 00:19:44,360
Speaker 1: the i m F has Brazil at about of GDP

316
00:19:44,880 --> 00:19:48,439
Speaker 1: UM debt public debt, and the and the and the

317
00:19:48,480 --> 00:19:51,560
Speaker 1: prospect is that over the next two years that number

318
00:19:51,600 --> 00:19:55,119
Speaker 1: could reach as high as So it's a fiscal situation

319
00:19:55,119 --> 00:19:58,640
Speaker 1: that's completely unhinged and unsustainable and the measures that would

320
00:19:58,680 --> 00:20:00,280
Speaker 1: have to be put in place would have to be

321
00:20:00,320 --> 00:20:03,919
Speaker 1: put in place rather urgently. UM. Mr Ballsonato has not

322
00:20:03,960 --> 00:20:08,040
Speaker 1: outlined what his plan for fixing the fiscal problems what

323
00:20:08,160 --> 00:20:11,640
Speaker 1: will be UM, nor has his economic advisor, by the way,

324
00:20:11,760 --> 00:20:15,000
Speaker 1: who for the past three weeks has completely disappeared from

325
00:20:15,040 --> 00:20:19,480
Speaker 1: public view view because he has clashed with Mr Ballsonato

326
00:20:19,560 --> 00:20:23,000
Speaker 1: on a couple of important UM issues. One of them

327
00:20:23,160 --> 00:20:26,280
Speaker 1: is exactly a financial transaction tax that he wanted to

328
00:20:26,359 --> 00:20:30,240
Speaker 1: bring back Monica think as so much doctible UH with

329
00:20:30,320 --> 00:20:33,080
Speaker 1: the Peterson Institute out of the London School of Economics,

330
00:20:33,119 --> 00:20:35,879
Speaker 1: with US with a good briefing there on Brazil. You know,

331
00:20:35,920 --> 00:20:38,040
Speaker 1: I say it doesn't matter, but when you look at

332
00:20:38,040 --> 00:20:41,200
Speaker 1: the scope scale of Brazil and I know it's distant

333
00:20:41,200 --> 00:20:44,400
Speaker 1: into the South, it matters. You get instability down there,

334
00:20:46,680 --> 00:20:50,600
Speaker 1: and I'd say it matters globally, particularly that interesting China,

335
00:20:50,840 --> 00:21:05,920
Speaker 1: Latin America, South America dynamic as well. It is a

336
00:21:06,040 --> 00:21:09,320
Speaker 1: day of a Nobel Prize in economics and all worldwide

337
00:21:09,840 --> 00:21:13,600
Speaker 1: are enjoy. That is Paul Romer of Stanford and William

338
00:21:13,680 --> 00:21:16,720
Speaker 1: Nordhouse of Yale. We've had a wonderful morning talking to

339
00:21:16,800 --> 00:21:20,040
Speaker 1: Villin Powder, among others, and in the many people that

340
00:21:20,119 --> 00:21:22,000
Speaker 1: we can talk to now and in the coming days,

341
00:21:22,040 --> 00:21:28,000
Speaker 1: including Professor's Romer in Nordhouse, I think a wonderful opinion

342
00:21:28,119 --> 00:21:31,119
Speaker 1: can come with Stephen Keene. Steve Keene is in London.

343
00:21:31,160 --> 00:21:34,240
Speaker 1: He's no relation to me. His family kept the e off,

344
00:21:34,359 --> 00:21:39,240
Speaker 1: unlike the pretentious Keenes I'm associated with. A Professor Keene

345
00:21:39,320 --> 00:21:44,480
Speaker 1: joins us right now on this day of economic growth, innovation,

346
00:21:45,280 --> 00:21:48,120
Speaker 1: uh and some of the trends and mysteries of how

347
00:21:48,160 --> 00:21:50,680
Speaker 1: we grow. Steve Keene, thank you so much for time

348
00:21:50,720 --> 00:21:52,959
Speaker 1: to finding time to be with us. I would go

349
00:21:53,000 --> 00:21:56,000
Speaker 1: back to one of the heroes of Nordhouse in Romer,

350
00:21:56,080 --> 00:22:01,320
Speaker 1: which is Joseph Schumpeter in an article creative response in

351
00:22:01,480 --> 00:22:06,399
Speaker 1: economic history, How do we know within our economic history

352
00:22:06,840 --> 00:22:11,119
Speaker 1: how we grow, how we innovate, how we get better?

353
00:22:11,280 --> 00:22:14,920
Speaker 1: Do we really have an answer? No? I think Shampetta

354
00:22:14,920 --> 00:22:16,919
Speaker 1: gave a better right answer than Roma. Frankly that I

355
00:22:17,000 --> 00:22:18,960
Speaker 1: quite like Paul Roma's work, and I like the man

356
00:22:19,040 --> 00:22:23,040
Speaker 1: as well. But in terms of explaining what leads to innovation,

357
00:22:23,119 --> 00:22:26,359
Speaker 1: Sama gave a far better explanation of it, which really

358
00:22:26,400 --> 00:22:30,119
Speaker 1: relates to um seeing that because coming up with a

359
00:22:30,160 --> 00:22:33,879
Speaker 1: technology which can drastically reduced the cost of production, Now

360
00:22:33,960 --> 00:22:36,560
Speaker 1: that might seem pretty banal and obvious, but in fact

361
00:22:36,640 --> 00:22:39,560
Speaker 1: that's more that's the does a deeper analysis and show

362
00:22:39,600 --> 00:22:42,480
Speaker 1: part about how that happens than in any modern match

363
00:22:42,800 --> 00:22:46,280
Speaker 1: macro economic theory, which generally just thinks the technology sort

364
00:22:46,280 --> 00:22:49,040
Speaker 1: of falls like manner from heaven. Yeah, and within that,

365
00:22:49,119 --> 00:22:51,159
Speaker 1: and I go back to the magisterial book that was

366
00:22:51,240 --> 00:22:52,800
Speaker 1: my book of the year a number of years ago,

367
00:22:52,840 --> 00:22:57,760
Speaker 1: Thomas mccrawe profit of innovation is this idea that we're

368
00:22:57,840 --> 00:23:01,679
Speaker 1: in now of technology, the mystery of it, and is

369
00:23:01,680 --> 00:23:06,439
Speaker 1: it taking over our lives? Is the technology now the

370
00:23:06,520 --> 00:23:09,879
Speaker 1: same as it was years ago? All in terms of

371
00:23:09,880 --> 00:23:12,400
Speaker 1: what technology technolog is always new time in the sense

372
00:23:12,440 --> 00:23:14,880
Speaker 1: that what comes along with something which nobody has thought

373
00:23:14,880 --> 00:23:17,359
Speaker 1: of before. I'm really going to be accused of being

374
00:23:17,359 --> 00:23:21,920
Speaker 1: an Italin Musk fanboy here, But for example, Musk's idea

375
00:23:22,160 --> 00:23:24,119
Speaker 1: that if you could get a rocket to land on

376
00:23:24,119 --> 00:23:27,040
Speaker 1: its back on its tail again and reuse the rocket,

377
00:23:27,040 --> 00:23:30,200
Speaker 1: you could cut the cost of getting objects and displaced

378
00:23:30,240 --> 00:23:32,600
Speaker 1: by a factor of a hundred. That's the sort of

379
00:23:32,600 --> 00:23:35,800
Speaker 1: thing which leads to innovation and massive profit as well

380
00:23:35,840 --> 00:23:39,199
Speaker 1: as providing something that never existed before. So you know,

381
00:23:40,119 --> 00:23:42,200
Speaker 1: if you think about street lighting used to be gas,

382
00:23:42,240 --> 00:23:44,480
Speaker 1: it used to be whale oil, and along comes out

383
00:23:44,480 --> 00:23:50,720
Speaker 1: of simbl electric wires transmitting power to incandescent tubes. That

384
00:23:50,720 --> 00:23:54,320
Speaker 1: that is a huge advanced advance which either provides something

385
00:23:54,359 --> 00:23:57,159
Speaker 1: has never existed before and then completely takes over another

386
00:23:57,200 --> 00:23:59,520
Speaker 1: market or addressed if we cuts the cost of something

387
00:23:59,520 --> 00:24:03,920
Speaker 1: that's already happening and gives profit to the entrepreneur. Professor Keen,

388
00:24:04,240 --> 00:24:08,040
Speaker 1: I'm wondering if you could address the connection between US,

389
00:24:08,280 --> 00:24:11,400
Speaker 1: or not just US government, but government participation in these

390
00:24:11,480 --> 00:24:15,560
Speaker 1: very innovations that you describe, because, for example, with space

391
00:24:15,960 --> 00:24:21,200
Speaker 1: X and the deployment of new launch technology and recovery technology,

392
00:24:21,200 --> 00:24:22,680
Speaker 1: a lot of that has to do with the fact

393
00:24:22,680 --> 00:24:25,800
Speaker 1: that the US government basically got out of the business

394
00:24:25,880 --> 00:24:28,640
Speaker 1: and turned that over to private industry because they didn't

395
00:24:28,640 --> 00:24:31,480
Speaker 1: want to pay for it anymore. Previously cost was not

396
00:24:31,560 --> 00:24:36,760
Speaker 1: an object. Yeah, that's the extent to which innovation occurs

397
00:24:36,800 --> 00:24:40,840
Speaker 1: really reflects in a sense people can afford to lose

398
00:24:40,920 --> 00:24:43,000
Speaker 1: large amounts of money. And I think you've got to

399
00:24:43,000 --> 00:24:45,520
Speaker 1: combine the inns to marry on a Mazacuto k one

400
00:24:45,520 --> 00:24:49,560
Speaker 1: extreme and Bill Janeway at the other. In the Mariana

401
00:24:49,600 --> 00:24:52,480
Speaker 1: focuses upon the role of the government innovation, and Bill

402
00:24:52,560 --> 00:24:56,119
Speaker 1: focuses upon the role of wealthy entrepreneurs and innovation. And

403
00:24:56,160 --> 00:24:58,880
Speaker 1: in both cases it's the capacity to lose money without

404
00:24:58,920 --> 00:25:01,000
Speaker 1: being wiped out by it that means you can take

405
00:25:01,040 --> 00:25:03,320
Speaker 1: that risk to innovate in the first place. So the

406
00:25:03,400 --> 00:25:09,160
Speaker 1: drive to innovate Vanassa came from basically the political struggle

407
00:25:09,200 --> 00:25:13,680
Speaker 1: between America and Russia, with Kennedy setting that incredible objective

408
00:25:13,720 --> 00:25:16,080
Speaker 1: of getting a man on the moon within seven years,

409
00:25:16,080 --> 00:25:19,760
Speaker 1: and the American technology you're doing at regardless of expense,

410
00:25:20,280 --> 00:25:22,880
Speaker 1: that's a huge loss ly than no private corporation could

411
00:25:22,920 --> 00:25:25,280
Speaker 1: ever have begun that in the way that NASA did

412
00:25:25,520 --> 00:25:28,600
Speaker 1: fast slow forward fifty years from them. And you look

413
00:25:28,640 --> 00:25:30,359
Speaker 1: at it and think, well, it's got to the stage

414
00:25:30,359 --> 00:25:33,560
Speaker 1: where private companies can take this on because the loss

415
00:25:33,680 --> 00:25:35,679
Speaker 1: leading has been done by NASA, and there is a

416
00:25:35,680 --> 00:25:38,480
Speaker 1: combination between the two. And in musk Is just recently

417
00:25:38,760 --> 00:25:41,240
Speaker 1: quite openly said he has an enormous debt to NASA

418
00:25:41,560 --> 00:25:43,480
Speaker 1: in enabling him to do what he's done, so as

419
00:25:43,480 --> 00:25:45,960
Speaker 1: a symbiosis between the two and not the rivalry that

420
00:25:46,000 --> 00:25:50,120
Speaker 1: Austrian economists often go on with. So amusing that kind

421
00:25:50,200 --> 00:25:54,240
Speaker 1: of perspective. What can you say now about the technological

422
00:25:54,359 --> 00:25:57,679
Speaker 1: advances that we point to in the use of the

423
00:25:57,720 --> 00:26:01,120
Speaker 1: Internet and a connected world where well we see that

424
00:26:01,160 --> 00:26:04,399
Speaker 1: play out. Well, that's been an interesting one again because

425
00:26:04,440 --> 00:26:07,720
Speaker 1: we know that the founder of the Internet has become

426
00:26:07,760 --> 00:26:11,480
Speaker 1: disgusted with his own creation because he was because it

427
00:26:11,520 --> 00:26:14,320
Speaker 1: was created in daper That's another thing that was begun

428
00:26:14,440 --> 00:26:18,440
Speaker 1: by somebody working for a military part of the American

429
00:26:18,480 --> 00:26:21,480
Speaker 1: military for a communication systance that again in the government sector,

430
00:26:21,880 --> 00:26:26,040
Speaker 1: it then had no because it was released totally free,

431
00:26:26,040 --> 00:26:29,200
Speaker 1: open source. It then became adopted by a large number

432
00:26:29,240 --> 00:26:31,439
Speaker 1: of commercials and now we have companies like Google and

433
00:26:31,480 --> 00:26:34,639
Speaker 1: Facebook dominating and mining us for it. So one of

434
00:26:34,640 --> 00:26:37,360
Speaker 1: the directions have been spoken about is to task back

435
00:26:37,400 --> 00:26:39,400
Speaker 1: to the stage where it can't be dominated by large

436
00:26:39,400 --> 00:26:43,520
Speaker 1: private corporations. So there's still tons of innovation to go on,

437
00:26:43,600 --> 00:26:46,160
Speaker 1: and often the next innovation is fixing up the mistakes

438
00:26:46,160 --> 00:26:48,680
Speaker 1: of the one before. Stephen Keene with us with Kingston

439
00:26:48,760 --> 00:26:52,560
Speaker 1: University as we celebrate two Nobel Prize winners with good

440
00:26:52,560 --> 00:26:57,920
Speaker 1: comment and perspective from Professor Key William Nordhouse, among other things.

441
00:26:57,920 --> 00:27:03,359
Speaker 1: Steve Keane was handed Samuelson's Jewel of Night and tried

442
00:27:03,400 --> 00:27:06,480
Speaker 1: to move forward a textbook. And this is in decades

443
00:27:06,520 --> 00:27:10,840
Speaker 1: of teaching at Yale University. Are the textbook of nineteen

444
00:27:11,480 --> 00:27:14,280
Speaker 1: Are the textbooks the classic I don't know, nineteen editions

445
00:27:14,320 --> 00:27:17,879
Speaker 1: whatever of Nordhouse? Are they still usable or have we

446
00:27:18,040 --> 00:27:23,280
Speaker 1: just so far moved on from traditional economic academics. Those

447
00:27:23,280 --> 00:27:26,919
Speaker 1: textbooks should be burnt. I don't mind contributing carbon if

448
00:27:26,960 --> 00:27:29,360
Speaker 1: we burn all the textbooks that have been created s Samuelson,

449
00:27:29,440 --> 00:27:32,800
Speaker 1: because Frank is the Poltico. It's massively astray. That's why

450
00:27:32,800 --> 00:27:35,359
Speaker 1: I've decided to create what I call the Novel Prize

451
00:27:35,359 --> 00:27:39,200
Speaker 1: in Economics as opposed to Noble on Nobel because these

452
00:27:39,200 --> 00:27:43,280
Speaker 1: textbooks and the crazy ideas that have been incorporated in

453
00:27:43,320 --> 00:27:47,280
Speaker 1: and from from delusional economic theory is white and I'm

454
00:27:47,280 --> 00:27:50,280
Speaker 1: its just so completely irrelevant to today. So, for example,

455
00:27:50,320 --> 00:27:52,639
Speaker 1: I'm glad Norhouse got the prize in the sense that

456
00:27:52,680 --> 00:27:56,440
Speaker 1: he's done work which extends mainstream economics to consider ecological

457
00:27:56,480 --> 00:28:00,359
Speaker 1: issues some extent. But a far better been to the

458
00:28:00,400 --> 00:28:03,840
Speaker 1: prize would have been Dennis Meadows for the totally innovative

459
00:28:04,080 --> 00:28:07,159
Speaker 1: dynamic non equilibrium approach he built with the limits to

460
00:28:07,160 --> 00:28:10,440
Speaker 1: growth models back in nine seventy two seventy three. So

461
00:28:10,920 --> 00:28:14,360
Speaker 1: I have no time whatsoever Sammylson's textbook, and if I could,

462
00:28:14,640 --> 00:28:16,439
Speaker 1: if I could wipe it off the face of the planet,

463
00:28:16,480 --> 00:28:19,160
Speaker 1: I would, because it's what economics up a huge garden path.

464
00:28:19,560 --> 00:28:21,879
Speaker 1: In full disclosure, folks, I sort of knew what the

465
00:28:21,920 --> 00:28:24,520
Speaker 1: answer would be like when I set up Professor Keene

466
00:28:24,520 --> 00:28:27,520
Speaker 1: with that questions. I'll piulant one more question here with

467
00:28:27,960 --> 00:28:31,840
Speaker 1: see what he can burn next. Well, and after that,

468
00:28:31,920 --> 00:28:34,639
Speaker 1: I'm not so sure, Professor Keen anything else we should

469
00:28:34,640 --> 00:28:38,520
Speaker 1: get rid of to make ourselves smarter. Yeah, that's a

470
00:28:38,520 --> 00:28:39,920
Speaker 1: good point. We have to get rid of thinking in

471
00:28:40,000 --> 00:28:43,959
Speaker 1: terms of equilibrium, which economists are still dominated by. Virtually

472
00:28:43,960 --> 00:28:46,920
Speaker 1: every prize in economics goes to somebody uses equilibrium style

473
00:28:46,920 --> 00:28:49,760
Speaker 1: models rather than the bath from equilibrium, and get rid

474
00:28:49,800 --> 00:28:51,680
Speaker 1: of the belief we can model capitalism as though it's

475
00:28:51,680 --> 00:28:54,720
Speaker 1: a barber system. And it's fundamentally monitory. So those things

476
00:28:54,760 --> 00:28:56,800
Speaker 1: need to happen, and until such time as it does,

477
00:28:56,840 --> 00:28:59,360
Speaker 1: will always be a critic of the fundamental basis of

478
00:28:59,400 --> 00:29:02,160
Speaker 1: the novel Rise, though I must say, particularly with Paul

479
00:29:02,240 --> 00:29:04,960
Speaker 1: Ramos had the courage to charity. Chilman's the same nonsense

480
00:29:05,280 --> 00:29:07,920
Speaker 1: in a wonderful paper called The Trouble of Maccua Economics.

481
00:29:08,680 --> 00:29:10,920
Speaker 1: I'm I'm very pleased at thret the Ramo one the award,

482
00:29:10,920 --> 00:29:13,200
Speaker 1: and I'm not unhappy that Northhouse got it. I'll be

483
00:29:13,280 --> 00:29:16,480
Speaker 1: much happy to win to a Dennis Meadows instead. Stephen King,

484
00:29:16,720 --> 00:29:19,640
Speaker 1: thank you so much for incisive conversation and opinion. He

485
00:29:19,760 --> 00:29:29,960
Speaker 1: is at Kingston University and takes a different report. Thanks

486
00:29:29,960 --> 00:29:34,240
Speaker 1: for listening to the Bloomberg Surveillance podcast. Subscribe and listen

487
00:29:34,440 --> 00:29:39,800
Speaker 1: to interviews on Apple Podcasts, SoundCloud, or whichever podcast platform

488
00:29:39,880 --> 00:29:44,200
Speaker 1: you prefer. I'm on Twitter at Tom Keane before the podcast.

489
00:29:44,240 --> 00:30:00,400
Speaker 1: You can always catch us worldwide. I'm Bloomberg Radio