WEBVTT - Bloomberg Businessweek Weekend - May 3rd, 2024 0:00:02.440 --> 0:00:07.480 Bloomberg Audio Studios, Podcasts, radio News. 0:00:08.360 --> 0:00:12.720 This is Bloomberg Business Week Inside from the reporters and 0:00:12.920 --> 0:00:16.480 editors who bring you America's most trusted business magazine, plus 0:00:16.560 --> 0:00:20.439 gloom wal Business finance and tech news. The Bloomberg Business 0:00:20.440 --> 0:00:26.000 Week Podcast with Carol Messer and Tim Stenebeck from Bloomberg Radio. 0:00:27.240 --> 0:00:30.120 Hi, everyone, Welcome to the Bloomberg Business Wee Weekend Podcast. 0:00:30.440 --> 0:00:33.400 So this past week, yes, we got another jobs report 0:00:33.920 --> 0:00:37.000 and another Fed decision. Bottom line, folks, especially when it 0:00:37.040 --> 0:00:39.440 comes to the Fed, we are still data dependent and 0:00:39.520 --> 0:00:43.360 more inflation progress is needed. The Essential Bank did signal 0:00:43.400 --> 0:00:47.080 that rate hikes are unlikely, dampening a narrative Tim that's 0:00:47.320 --> 0:00:49.520 creeping into a lot of our conversations as of late. 0:00:49.680 --> 0:00:52.080 In the meantime, Amazon and Apple were among the big 0:00:52.120 --> 0:00:54.480 earnings this week as we continue to make our way 0:00:54.520 --> 0:00:57.680 through quarterly updates. All important and among our most read 0:00:57.720 --> 0:01:01.040 stories this week, as are the protest on college campuses 0:01:01.080 --> 0:01:04.320 around the country involving pro Palestinian protesters. 0:01:04.400 --> 0:01:06.120 We had a great voice on the protest from a 0:01:06.160 --> 0:01:10.039 long time Columbia University professor, none other than Nobel Laureate 0:01:10.319 --> 0:01:14.080 Joseph Stieglitz. He weighed in on the protests. He also 0:01:14.120 --> 0:01:17.600 talked about FED policy, the economy, and the Road to Freedom. 0:01:17.840 --> 0:01:19.800 It's the subject of his new book Love More in 0:01:19.840 --> 0:01:20.480 a Moment. 0:01:20.440 --> 0:01:22.720 Plus and what we are calling Our Deep Think Hour. 0:01:23.160 --> 0:01:23.520 David E. 0:01:23.720 --> 0:01:27.120 Sanger, the Pulitzer Prize winning White House and National Security 0:01:27.120 --> 0:01:30.160 correspondent for The New York Times, on his latest book, 0:01:30.280 --> 0:01:33.640 It's called New Cold Wars, China's Rise, Russia's invasion, and 0:01:33.680 --> 0:01:35.559 America's struggle to Defend the West. 0:01:35.680 --> 0:01:38.399 David E. Sanger and Joseph Stieglitz two authors with some 0:01:38.440 --> 0:01:40.600 deep thoughts on some of the most pressing issues of 0:01:40.640 --> 0:01:44.920 our time. We begin with Nobel Laureate Joseph Stieglitz, Professor 0:01:44.959 --> 0:01:48.000 of Economics over at Columbia University. He was Chairman of 0:01:48.040 --> 0:01:51.400 the Council of Economic Advisors under President Clinton and a 0:01:51.440 --> 0:01:53.080 former Chief Economist of the World Bank. 0:01:53.280 --> 0:01:56.640 He has written many books, authored numerous research papers on 0:01:56.680 --> 0:02:00.440 many aspects of economics, equality, and more. His latest subject 0:02:00.520 --> 0:02:03.240 matter covered in a new book entitled The Road to Freedom, 0:02:03.400 --> 0:02:07.120 Economics and the Good Society. Our conversation done just before 0:02:07.160 --> 0:02:09.920 the latest FED decision began with the Fed's commitment to 0:02:09.960 --> 0:02:12.000 that two percent inflation objective. 0:02:12.600 --> 0:02:13.520 From the point of view. 0:02:13.480 --> 0:02:17.399 Of economics, having two and a half or even three 0:02:17.440 --> 0:02:20.560 percent inflation is not a big deal. You know, the 0:02:20.840 --> 0:02:23.560 two percent target was pulled out of thin air. It 0:02:23.639 --> 0:02:26.560 was not based on economic science. What we want to 0:02:26.600 --> 0:02:29.320 be sure of is that we don't have runaway inflation. 0:02:29.880 --> 0:02:33.000 And inflation has clearly been tamed. It's been brought down. 0:02:33.120 --> 0:02:37.480 It's stable. It electuates from month to month, but it 0:02:37.560 --> 0:02:41.520 is not a major problem. We should be focusing on 0:02:41.639 --> 0:02:46.960 other things, continuing economic growth, making sure that all Americans 0:02:48.120 --> 0:02:51.360 share in that growth. Those are the kinds of things 0:02:51.360 --> 0:02:53.600 that we ought to be thinking more about. 0:02:54.160 --> 0:02:57.840 So, Professor Stieglitz, should the Fed abandon the two percent 0:02:57.919 --> 0:03:01.160 inflation goal? Should they have a different inflation goal, a 0:03:01.200 --> 0:03:03.520 different metric that they should be held accountable to. 0:03:03.919 --> 0:03:04.880 Yes, I think they should. 0:03:04.919 --> 0:03:08.240 I think they should be talking about keeping within a 0:03:08.400 --> 0:03:11.880 range to maybe three, three and a half four percent. 0:03:12.600 --> 0:03:17.240 You know, there's actually some economic science that says, especially 0:03:17.280 --> 0:03:20.760 in a time of major structural change such as we're 0:03:20.800 --> 0:03:26.800 going through, having a little higher inflation actually is helpful 0:03:26.919 --> 0:03:32.560 in reallocating resources in the presence of downward nominal rigidities 0:03:32.600 --> 0:03:37.880 of wages because What guides the movement of resources from 0:03:37.880 --> 0:03:41.960 one place to another is relative wages. And if some 0:03:42.040 --> 0:03:46.120 wages are sticky downward, you want other wages to go 0:03:46.400 --> 0:03:49.920 up enough to move labor, and that means you're going 0:03:50.000 --> 0:03:53.440 to have to have more inflation. So actually a little 0:03:53.480 --> 0:03:56.120 higher inflation is actually good for the economy. 0:03:56.360 --> 0:04:00.520 Do you think the FEDS management of the economy has 0:04:00.600 --> 0:04:02.680 been a good one in terms of policy? 0:04:03.080 --> 0:04:09.960 Quite frankly no, But bluntly, let's go back to when 0:04:10.560 --> 0:04:14.760 inflation broke out after the pandemic and the Russian invasion 0:04:14.800 --> 0:04:19.160 of Ukraine. The question was what was the cause, the 0:04:19.200 --> 0:04:21.279 primary cause of the inflation. 0:04:21.360 --> 0:04:22.599 It was unambiguous. 0:04:22.880 --> 0:04:27.920 It was the pandemic and war related interruptions in supply 0:04:28.120 --> 0:04:32.880 chains and rising prices caused by shortages of oil and food. 0:04:33.880 --> 0:04:37.440 It was demand shifts. People wanted to live in different places, 0:04:38.360 --> 0:04:41.240 and that meant housing prices went up where there was 0:04:41.240 --> 0:04:44.080 a scarcity, but didn't go down as much where there 0:04:44.120 --> 0:04:46.240 was where people didn't. 0:04:45.960 --> 0:04:46.520 Want to live. 0:04:47.960 --> 0:04:53.040 In parts of New York, raising interest rates actually impeded 0:04:53.440 --> 0:04:56.360 the ability of the economy to respond to that kind 0:04:56.360 --> 0:05:03.320 of structural uh. To that that kind of challenge, we 0:05:03.400 --> 0:05:06.800 needed to build more houses in the places where there 0:05:06.839 --> 0:05:13.480 was a scarcity, and having higher interest rates actually works 0:05:13.960 --> 0:05:17.920 makes it more difficult. They also have a model of 0:05:17.960 --> 0:05:21.200 economy that's based on competition. That might have been true 0:05:21.240 --> 0:05:24.560 some time ago, but we have an economy with a 0:05:24.560 --> 0:05:29.360 lot of market power at firms are trading off. If 0:05:29.400 --> 0:05:31.919 they raise their prices, they get more profits today, they 0:05:31.960 --> 0:05:36.880 lose profits in the future, and in that trade off, 0:05:36.920 --> 0:05:39.839 when you raise the interest rate, they value those future 0:05:39.920 --> 0:05:43.600 losses less, and they were induced to raise their prices more. 0:05:43.920 --> 0:05:45.360 So margins go up. 0:05:45.880 --> 0:05:50.280 And a marked aspect of the inflation that we've just 0:05:50.360 --> 0:05:54.040 been through is that markets have increased enormously. 0:05:54.520 --> 0:05:58.080 Hey, Professor Stieglitz, I just wanted to speaking of the FED, Carol, 0:05:58.120 --> 0:05:59.839 I know you would all. 0:05:59.480 --> 0:06:01.800 When went before. We have a bigger, broader question, and 0:06:01.839 --> 0:06:03.920 it's certainly been a bigger to jump in on that. Well, 0:06:03.920 --> 0:06:06.200 what do you think then we should be cutting rates already, 0:06:06.200 --> 0:06:07.599 that we're behind the curve right now? 0:06:08.960 --> 0:06:11.600 Yes, I think the risks are asymmetric. 0:06:12.279 --> 0:06:17.280 I think with Europe already slowing down in recession, we 0:06:17.320 --> 0:06:20.599 don't know where China is going to be going. I 0:06:20.640 --> 0:06:26.479 think proudents would have us going back to a more 0:06:26.560 --> 0:06:31.560 normal infrast rate. The higher interest rates are really not 0:06:31.600 --> 0:06:32.960 going to be taming inflation. 0:06:33.160 --> 0:06:34.400 That that model was wrong. 0:06:34.440 --> 0:06:37.360 In another way, they dramatically had said that we're going 0:06:37.400 --> 0:06:40.640 to need five percent of inflation for five percent unemployment 0:06:40.680 --> 0:06:43.320 for some time in order to get inflation down. 0:06:43.360 --> 0:06:44.680 They were absolutely wrong. 0:06:45.120 --> 0:06:48.919 We got inflation down where in a period where we 0:06:49.000 --> 0:06:53.880 kept unemployment relatively low. So they are analysis of the 0:06:53.920 --> 0:06:58.400 economy was just off. And meanwhile they have put at 0:06:58.480 --> 0:07:02.640 risk our banking system. We had a problem in Selcom 0:07:02.720 --> 0:07:06.400 Vallet Bank partly because of the enormous changes in terms 0:07:06.400 --> 0:07:11.240 structure which their policies led to. And we're facing a 0:07:11.280 --> 0:07:14.160 debt crisis in the developing countries and emerging markets. 0:07:14.520 --> 0:07:20.880 So there's enormous one sided risk. I believe in the 0:07:20.920 --> 0:07:23.120 policies that they've been pursuing well. 0:07:23.160 --> 0:07:25.000 On the FED, Professor Stieglitz, I got to ask you 0:07:25.040 --> 0:07:27.520 about this Wall Street Journal report that broke last night 0:07:27.840 --> 0:07:30.560 that said how former Trump administration officials are coming up 0:07:30.560 --> 0:07:33.360 with plans to take on the independence of the Federal 0:07:33.400 --> 0:07:37.440 Reserve essentially at one end of the spectrum, even allowing 0:07:37.680 --> 0:07:40.400 if President Trump gets re elected him to weigh in 0:07:40.560 --> 0:07:43.560 on FED policy when it comes to interest rates. Talk 0:07:43.560 --> 0:07:46.280 a little bit about your reaction to if this were 0:07:46.360 --> 0:07:49.360 to come to fruition, how important the independence of the 0:07:49.360 --> 0:07:52.120 FED is and if that would really put at risk 0:07:52.440 --> 0:07:55.880 the model of the independence of the US financial system. 0:07:56.600 --> 0:08:01.800 Well, I think Trump is himself a major argument why 0:08:01.880 --> 0:08:04.480 you want to have independence. 0:08:05.360 --> 0:08:06.000 Of the FED. 0:08:06.680 --> 0:08:12.080 You don't want somebody who doesn't understand monetary policy, who would. 0:08:13.360 --> 0:08:15.160 Put at risk the long run. 0:08:15.000 --> 0:08:18.880 Stability of the economy for the short term electoral advantage 0:08:18.920 --> 0:08:23.440 of having a hot economy right before an election. That's 0:08:23.480 --> 0:08:30.280 precisely why there is an argument for independence. So you know, 0:08:30.400 --> 0:08:35.360 I believe in the accountability of the FED. It is 0:08:35.400 --> 0:08:36.439 a public institution. 0:08:38.480 --> 0:08:39.319 We had. 0:08:41.280 --> 0:08:44.560 Previous chairman of the FED. We're very cognizant of that. 0:08:44.760 --> 0:08:49.640 I remember Paul Voker saying Congress created us and Congress 0:08:49.679 --> 0:08:53.240 can uncreate us. So there is a kind of accountability 0:08:53.320 --> 0:08:57.720 that responsible heads of the FED understand. But we certainly 0:08:57.760 --> 0:09:02.360 don't want Donald Trump to we run monetary policy, all right. 0:09:02.360 --> 0:09:04.719 We do want to dig into your book because you've 0:09:04.720 --> 0:09:07.120 been thinking a lot about the meaning of freedom, and 0:09:07.160 --> 0:09:10.440 I think we throw the word abown a lot. I 0:09:10.480 --> 0:09:15.160 think the folks who created the United States are founding 0:09:15.200 --> 0:09:19.520 fathers thought about freedom a lot and the difference though 0:09:19.720 --> 0:09:23.200 between what that really means, and maybe it comes down to, 0:09:23.320 --> 0:09:25.679 as you think about it, the values that we all 0:09:25.720 --> 0:09:28.120 have in society tell us about how we need to 0:09:28.160 --> 0:09:31.720 kind of maybe redefine freedom and what it means in 0:09:31.800 --> 0:09:37.360 terms of citizens more broadly and generally as well as 0:09:37.440 --> 0:09:39.440 economically in terms of their success. 0:09:39.760 --> 0:09:44.880 Sure, you know, I approached the issue obviously as an economist, 0:09:45.360 --> 0:09:49.160 and as an economist we think of freedom is free 0:09:49.200 --> 0:09:51.559 to do what you can do. What are the choices 0:09:51.600 --> 0:09:55.320 that you can make. Somebody who is at the point 0:09:55.320 --> 0:09:57.600 of starvation doesn't really have any freedom. 0:09:57.640 --> 0:09:58.400 He has to do what. 0:09:59.679 --> 0:10:04.000 He can to survive, and so expanding the set of 0:10:04.080 --> 0:10:08.559 choices that individual is available is a way of saying 0:10:08.640 --> 0:10:12.120 that he has more freedom. And here there are a 0:10:12.160 --> 0:10:16.000 couple of ideas I put forward in my book. The 0:10:16.000 --> 0:10:23.160 first is that in our integrated urban twenty per century economy, 0:10:24.400 --> 0:10:29.520 one person does the expansion of his freedom may lead 0:10:29.640 --> 0:10:35.679 to less freedom of others. Isaiah Berlin, the great Oxford philosopher, 0:10:35.760 --> 0:10:39.400 put it this way. He said, freedom for the wolfs 0:10:39.480 --> 0:10:43.480 has often meant death for the sheep. And in the 0:10:43.520 --> 0:10:48.320 context of the US, for instance, freedom to carry an 0:10:48.360 --> 0:10:54.880 AK forty seven means that people will die, and it 0:10:54.920 --> 0:10:58.640 means that our school children are not free from fear. 0:10:59.880 --> 0:11:02.959 They have to learn what to do if a gunman 0:11:03.080 --> 0:11:07.440 comes into the classroom and teachers have to go to 0:11:07.480 --> 0:11:12.360 school worried about whether they'll be attacked. Freedom not to 0:11:12.400 --> 0:11:17.079 wear masks is exposed taking away the freedom of others 0:11:17.120 --> 0:11:17.560 to live. 0:11:18.280 --> 0:11:19.080 So we. 0:11:21.280 --> 0:11:25.680 Have to balance these freedoms. There are trade offs. Many cases, 0:11:26.120 --> 0:11:30.520 those trade offs are easy. Freedom to pollute takes away 0:11:31.400 --> 0:11:37.360 the freedom to have somebody with asthma to even live, 0:11:37.559 --> 0:11:40.719 let alone the freedom of all of us to live 0:11:40.760 --> 0:11:45.240 on our planet. So there, I think we have to 0:11:45.280 --> 0:11:50.360 constrain the freedom of the polluters and the freedom of exploiters. 0:11:50.880 --> 0:11:54.320 So we're talking with Joseph Stiegletz, Nobel Laurate economist, professor 0:11:54.320 --> 0:11:57.120 of economics at Columbia University, and we're talking about his 0:11:57.160 --> 0:11:59.760 new book, The Road to Freedom, Economics and the Good Society. 0:12:00.000 --> 0:12:03.439 All Right, So if we rethink Professor Stieglitz the idea 0:12:03.559 --> 0:12:06.640 of freedom, so it's maybe more inclusive or it's a 0:12:06.640 --> 0:12:11.960 broader definition, how do we do that within society? With corporations, 0:12:12.440 --> 0:12:15.040 the need to be profitable for those we are in 0:12:15.160 --> 0:12:17.680 earning season. We look at companies and their reports and 0:12:17.720 --> 0:12:21.320 that's how we kind of measure them, grade them. What 0:12:21.360 --> 0:12:23.720 does government need to do? How can we maybe be 0:12:23.720 --> 0:12:25.320 better if you will for more. 0:12:25.840 --> 0:12:30.479 First, let me emphasize that in the world i've just described, 0:12:31.600 --> 0:12:37.040 there's an important role for regulations. Corporations often don't like that, 0:12:37.160 --> 0:12:40.560 but we have to remember the purpose of our economy 0:12:40.760 --> 0:12:45.439 is to improve the lives and livelihoods of our citizens. 0:12:46.080 --> 0:12:49.480 It's not the other way around. 0:12:49.559 --> 0:12:52.439 That the economy is supposed to serve society, not the 0:12:52.520 --> 0:12:53.720 other way around. 0:12:55.000 --> 0:12:56.080 There's another aspect. 0:12:56.520 --> 0:12:59.560 Regulations can actually expand the freedom of. 0:12:59.520 --> 0:12:59.960 All of us. 0:13:00.440 --> 0:13:04.440 Think about stop likes. If we don't have stop likes, 0:13:04.640 --> 0:13:07.720 we have gourdlock. None of us has the freedom to move. 0:13:08.360 --> 0:13:12.439 Stop likes orgs are a little bit of coercion, mean 0:13:12.480 --> 0:13:15.720 that I have to take turns, but by taking turns, 0:13:15.960 --> 0:13:20.040 we all have more freedom. And that basic idea extends 0:13:20.400 --> 0:13:25.240 much more broadly. People don't like to pay taxes. That's 0:13:25.280 --> 0:13:29.920 a they often feel kind of coersion. But when those 0:13:29.960 --> 0:13:34.160 tax revenues are used productively, like they were to invest 0:13:34.280 --> 0:13:37.160 in the internet and invest in the m R any 0:13:37.480 --> 0:13:40.880 platform that led to the vaccine against COVID nineteen. 0:13:41.400 --> 0:13:43.040 That expands our freedom to do. 0:13:44.800 --> 0:13:48.200 And so we have to look at this in I 0:13:48.240 --> 0:13:50.760 would say in a little bit more holistic way, Well, I. 0:13:50.760 --> 0:13:53.080 Want to go to your taxes point, because I'm curious 0:13:53.120 --> 0:13:56.160 if you could wave a magic wand or implement some 0:13:56.200 --> 0:13:59.199 sort of tax policy here in the US. What would 0:13:59.280 --> 0:14:02.280 it be, How could you reinvent it? Would you broad 0:14:02.280 --> 0:14:04.560 in the tax space, would you lean more on corporate taxes, 0:14:04.559 --> 0:14:07.720 would you tax wealth more? What, in your opinion, would work? 0:14:08.920 --> 0:14:10.959 Well, I begin by. 0:14:12.480 --> 0:14:15.480 Analyzing would are some of the key problems on our 0:14:15.520 --> 0:14:18.960 society faces, And one of them is inequality one of 0:14:19.000 --> 0:14:22.320 the reasons. And a second problem is the growth of 0:14:22.360 --> 0:14:26.800 market power, which has been enormous in the last few decades, 0:14:28.080 --> 0:14:31.480 and those two are obviously linked. When you have more 0:14:31.520 --> 0:14:35.720 market power, the fruits of that market power go to 0:14:35.800 --> 0:14:40.320 those at the top. We also have more economists called 0:14:40.360 --> 0:14:45.240 monopsity power firms have market power over workers and have 0:14:45.920 --> 0:14:47.840 driven down their wages. 0:14:47.840 --> 0:14:50.240 Significantly below a competitive level. 0:14:51.040 --> 0:14:55.520 So I want to have more anti trust policy, more 0:14:56.400 --> 0:15:02.520 competitive labor market policies. But that can take time. Meanwhile, 0:15:02.560 --> 0:15:07.120 there's a lot of monopoly rents. And so part of 0:15:07.160 --> 0:15:12.160 what I would begin by doing is increasing corporate colfix taxes, 0:15:12.200 --> 0:15:15.080 which are not a tax on return to capital, they 0:15:15.120 --> 0:15:20.360 are tax on this monopoly profits. I'd also like to 0:15:20.440 --> 0:15:24.880 have environmental taxes firms that are engaged, including the environment, 0:15:25.040 --> 0:15:30.960 on to pay for the damage that they're doing. Remarkably, America, 0:15:31.600 --> 0:15:35.520 those at the top pay a lower percentage of their 0:15:35.560 --> 0:15:40.360 taxes than those down below. Even some of our richest 0:15:40.360 --> 0:15:43.640 people have commented that they think they're right more wrong. 0:15:44.080 --> 0:15:46.160 Well, can I ask you, like on a day when 0:15:46.160 --> 0:15:48.240 we're looking at a company and forgive me, I'm just 0:15:48.240 --> 0:15:52.320 singling out because it popped. Shares of Alphabet are now 0:15:52.400 --> 0:15:56.200 a two tillion dollar market cap company this week, you 0:15:56.240 --> 0:15:59.320 know next week. Last week, we've been obsessed with, certainly 0:15:59.360 --> 0:16:01.440 what we call them mag Dificent seven, the big megacap 0:16:01.520 --> 0:16:04.960 technic companies. They're very big. Amazon, we talked with an 0:16:05.000 --> 0:16:08.560 author recently, so entrenched certainly in our world, and you 0:16:08.560 --> 0:16:12.320 think about their reach. Are these the companies the individuals, 0:16:12.360 --> 0:16:15.080 whether it's an Amazon, whether it's a Meta, whether it's 0:16:15.080 --> 0:16:18.120 an Alphabet that you think you talk about growth of 0:16:18.160 --> 0:16:21.600 market power isn't too much at this point in your 0:16:21.760 --> 0:16:24.520 view that something needs to be done to rain them 0:16:24.520 --> 0:16:28.880 in or do the benefits outweigh the downside here. 0:16:29.120 --> 0:16:31.720 Well, they do give benefits, but they have a lot 0:16:31.760 --> 0:16:36.560 of downsides. They need to be better regulated. Europe has 0:16:36.600 --> 0:16:41.360 done a better job at regulating them. The digital harms 0:16:41.400 --> 0:16:46.400 are quite obvious and have been by now well documented. 0:16:46.880 --> 0:16:53.240 But talking narrowly now about market power, I think we 0:16:53.280 --> 0:16:55.960 ought to do what we can to limit their market power, 0:16:56.360 --> 0:17:00.280 but tax the groups of that market power, of the 0:17:00.280 --> 0:17:04.639 revenues that they get at a much higher rate. You know, 0:17:04.720 --> 0:17:13.119 if you ask the question, would Jeff Bezos or the founders. 0:17:12.480 --> 0:17:13.760 Of Google. 0:17:15.000 --> 0:17:20.320 Or Zuperbird stop working if we tax their wealth in 0:17:20.359 --> 0:17:25.120 a way, say a three percent you know, so, any 0:17:25.160 --> 0:17:28.160 answer is obviously they would continue to work. 0:17:28.280 --> 0:17:29.959 Do you think that they would leave the United States? 0:17:30.400 --> 0:17:34.480 Well, we have imposed what we call an exit tax 0:17:35.040 --> 0:17:37.680 that those with a lot of wealth and don't feel 0:17:37.800 --> 0:17:42.720 who don't feel loyalty to the United States can leave. 0:17:42.760 --> 0:17:46.080 We allowed them to leave, but they have to pay 0:17:46.119 --> 0:17:50.000 a tax that represents attacks on their groups of the 0:17:50.040 --> 0:17:53.120 wealth that they've accumulated while they've been in the United States. 0:17:53.960 --> 0:17:58.520 And that that tax is significant and it is a deterrent. 0:18:00.160 --> 0:18:03.760 Not it may be that we ought to consider raising 0:18:03.840 --> 0:18:07.920 that tax, but I don't think people like at Zuckerberg 0:18:08.000 --> 0:18:11.679 Musk are going to leave the United States. They realize 0:18:12.119 --> 0:18:14.879 the benefits of American citizenship. 0:18:15.440 --> 0:18:19.040 We're speaking right now with Professor Joseph Stieglitz, Nobel Lauriate Economists. 0:18:19.080 --> 0:18:21.560 He's a professor of economics at Columbia University. He's got 0:18:21.560 --> 0:18:23.840 a new book out, The Road to Freedom, Economics and 0:18:23.880 --> 0:18:27.359 the Good Society. Professor, as I mentioned, you are up 0:18:27.359 --> 0:18:29.520 at Columbia. You've been there for a long time. We've 0:18:29.560 --> 0:18:32.440 been watching everything that's been happening on the campus there, 0:18:32.440 --> 0:18:36.360 as well as campuses including USC, Yale, MIT. The list 0:18:36.400 --> 0:18:38.679 continues to go on here in the United States, as 0:18:38.680 --> 0:18:41.879 we've seen pro Palestinian protests and encampments take over some 0:18:41.960 --> 0:18:46.399 of these campuses. Freedom in the academic context, how are 0:18:46.400 --> 0:18:48.800 you looking at the pest protests and the context of 0:18:48.920 --> 0:18:49.720 freedom of speech. 0:18:50.640 --> 0:18:51.520 That's a good question. 0:18:51.680 --> 0:18:55.560 I mean personal me comment that up where my office is, 0:18:55.600 --> 0:19:01.600 which is the Manhattanville campus, things are very quiet the 0:19:01.600 --> 0:19:06.200 Business school at the Business school, but you've been. 0:19:06.040 --> 0:19:09.080 On campus a long time. And you've seen different protests 0:19:09.080 --> 0:19:10.840 over the years, and it seemed to be I was 0:19:10.880 --> 0:19:13.879 there when there were protests, and it seems like that's 0:19:13.920 --> 0:19:16.960 what students are should be doing, exploring and pushing back 0:19:17.000 --> 0:19:19.440 when they don't feel like things are right. But what 0:19:19.640 --> 0:19:22.399 is the what is it those protests in the context 0:19:22.400 --> 0:19:23.240 of freedom of speech? 0:19:24.119 --> 0:19:25.960 So I agree with you very strongly. 0:19:26.560 --> 0:19:30.040 I'm actually happy the students are engaged in the world, 0:19:31.119 --> 0:19:33.440 you know. That's that's one of the things I try 0:19:33.480 --> 0:19:37.119 to kept them to be interested in the world, and 0:19:37.200 --> 0:19:41.879 also to reason about the world, to come to understand it, 0:19:42.000 --> 0:19:47.600 and to debate how could or should things be changed. 0:19:48.280 --> 0:19:52.000 So that's a good thing. And in my own life, 0:19:53.080 --> 0:19:59.639 protests have played a very important role. Back in nineteen 0:19:59.640 --> 0:20:02.520 sixty three, I was down there in the march in 0:20:02.640 --> 0:20:07.440 Washington with Martin Luther King, and you know that speech 0:20:07.440 --> 0:20:11.520 he gave about I have a dream has been a 0:20:11.600 --> 0:20:18.639 lifelong inspiration to me. So even civil disobedience in certain 0:20:18.680 --> 0:20:25.720 circumstances can be an important mechanism for social change. We 0:20:25.800 --> 0:20:29.919 have a special responsibility, of course, to make sure on 0:20:29.960 --> 0:20:33.359 our campus that all views get heard, that we can have. 0:20:33.680 --> 0:20:40.320 Civil debates and so on. The one hand. 0:20:41.119 --> 0:20:46.800 Academic freedom is really important, and I really took offense 0:20:47.080 --> 0:20:50.879 to Speaker Johnson coming up to our campus and calling 0:20:50.920 --> 0:20:55.320 for the resignation of our president. I hadn't seen anything 0:20:57.240 --> 0:21:01.000 like that, maybe since the HUAC hearings the House on 0:21:01.040 --> 0:21:05.080 American Activities Committee back with McCarthy in the fifties. I mean, 0:21:05.200 --> 0:21:10.359 that kind of direct interference in academia is just unheard of. 0:21:11.080 --> 0:21:15.280 And we know some of the Republicans have been trying 0:21:15.359 --> 0:21:20.760 to undermine universities because universities teach children how to our 0:21:20.800 --> 0:21:25.320 young our youngsters, our young men and women how to think, 0:21:25.440 --> 0:21:28.600 and a lot of people don't like that idea that 0:21:28.640 --> 0:21:33.040 they should be thinking for themselves. But at the same time, 0:21:33.600 --> 0:21:39.000 we have to create on campus a community where all 0:21:39.119 --> 0:21:42.719 voices are heard, and I think we're actually working very 0:21:42.800 --> 0:21:49.640 much towards that. There were only a few people raising problems, 0:21:50.760 --> 0:21:58.439 and I think having outside educators like the speaker is 0:21:58.480 --> 0:21:59.080 not helpful. 0:21:59.280 --> 0:22:01.560 We're going to leave it on that note. We always 0:22:01.600 --> 0:22:04.400 appreciate hearing you talk about hearing from voices. We always 0:22:04.440 --> 0:22:07.440 appreciate hearing from you. Professor Stieglitz, Thank you so much. 0:22:07.680 --> 0:22:11.399 Nobel Loride Economist, Columbia professor Joseph Stieglitz here in New 0:22:11.520 --> 0:22:14.600 York City. Check out his book his latest book, The 0:22:14.640 --> 0:22:18.440 Road to Freedom, Economics and the Good Society. Really appreciate 0:22:18.560 --> 0:22:20.600 us spending some time with you. 0:22:19.600 --> 0:22:24.119 You're listening to the Bloomberg Business Week podcast. Catch us 0:22:24.160 --> 0:22:27.399 live weekday afternoons from two to five pm Easter Listen 0:22:27.440 --> 0:22:30.119 on Apple Cardplay and then brought auto with a Bloomberg 0:22:30.160 --> 0:22:42.439 Business app or watch us Live on YouTube. 0:22:42.640 --> 0:22:44.960 L After the Cold War ended, there emerged a theory 0:22:44.960 --> 0:22:49.200 that Western liberal democracy had triumphed over fascism and communism. 0:22:49.480 --> 0:22:51.800 The theory was perhaps most notably put forth by the 0:22:51.840 --> 0:22:55.640 political scientist Francis Fukiyama, who argued that we'd reach quote 0:22:55.680 --> 0:22:59.280 the end of history, peace among nuclear superpowers. The Nazis 0:22:59.280 --> 0:23:02.320 were gone, the Berlyn Wall had fallen. It turns out 0:23:02.320 --> 0:23:04.480 things didn't exactly go the way that the West thought 0:23:04.520 --> 0:23:07.359 they would. The world didn't embrace the Western a form 0:23:07.400 --> 0:23:11.280 of liberal democracy. Russia invaded Georgia and Crimea, and then Ukraine, 0:23:11.280 --> 0:23:13.760 where it's in its thirty year of fighting. China over 0:23:13.800 --> 0:23:15.919 that time has risen to become the second largest economy 0:23:15.920 --> 0:23:19.160 in the world with its own global ambitions In other words, 0:23:19.160 --> 0:23:22.000 there are other countries that want to be superpowers. 0:23:22.520 --> 0:23:22.879 David E. 0:23:23.040 --> 0:23:25.520 Sanger is the Politzer Prize winning White House and National 0:23:25.560 --> 0:23:28.000 Security correspondent for the New York Times. He wrote the 0:23:28.000 --> 0:23:30.679 best seller The Perfect Weapon. His new book out earlier 0:23:30.760 --> 0:23:35.200 this month. It's called New Cold Wars, China's Rise, Russia's invasion, 0:23:35.200 --> 0:23:38.080 and America struggled to defend the West. David joins us 0:23:38.119 --> 0:23:41.280 from Washington, DC. David, congratulations on the book. 0:23:41.280 --> 0:23:41.679 How are you? 0:23:43.040 --> 0:23:46.119 Thank you? Thanks very much. It was an exciting and 0:23:47.040 --> 0:23:49.679 many it was fun exercise to go write this. 0:23:50.320 --> 0:23:53.119 Well, you write in the book that the revival of 0:23:53.119 --> 0:23:58.119 the superpower conflict took Washington by surprise. When was Washington's 0:23:58.119 --> 0:23:58.800 surprise by this? 0:23:58.840 --> 0:23:59.960 At what moment? When? 0:24:00.080 --> 0:24:02.639 And why why were we so caught off guard? 0:24:04.200 --> 0:24:06.400 Well, we were caught off guard for a couple of reasons. 0:24:06.600 --> 0:24:09.040 The first is that we had worked from that assumption 0:24:09.160 --> 0:24:12.560 that you described, that the end of history had come here. 0:24:12.600 --> 0:24:15.240 And while Fukiyama famously wrote it, he wasn't the only 0:24:15.240 --> 0:24:19.399 one to subscribe to it. Most of Washington subscribed to 0:24:19.440 --> 0:24:23.679 some version of that theory. The second reason is that 0:24:23.760 --> 0:24:26.720 we lived in a world of self delusion. We spent 0:24:26.880 --> 0:24:33.040 twenty years focusing on terrorism as if terrorism was the 0:24:33.359 --> 0:24:37.000 central challenge to the United States rather than the major 0:24:37.080 --> 0:24:44.600 nuclear armed and rising technological powers around US. Thirdly, we 0:24:45.000 --> 0:24:48.879 took way too long in doing the pivot to the 0:24:48.920 --> 0:24:52.919 Asia Pacific area. We talked about it for years and years, 0:24:53.119 --> 0:24:56.439