tv Fareed Zakaria GPS CNN October 16, 2022 10:00am-11:00am PDT
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i'm fareed zakaria coming live to you from new york. today on the program, i'll talk to "new york times" columnist tom friedman who points out not only is the united states involved in the largest war in europe since world war ii, but america has also entered a sort of tech war with china. and an energy struggle with saudi arabia. what in the world is going on? and china's leaders, more than 2,000 of them, are gathering this week to make major decisions about the country's decision for the next five years
and beyond. on the agenda, an unprecedented third term in office for xi jinping. what else will be decided? i will talk to the former prime minister of australia. then -- stop the steal maybe headed south of the border, as latin america's largest democracy seems to be taking cues from its neighbor up north. >> you don't concede when there's theft involved. >> we'll tell you about the controversy with brazil's presidential election.
but first here's my take. a distinguished russia expert has argued that the west's confrontation with russia over ukraine has already brought us into world war iii. that is dangerous hyperbole. what made the first two world wars so devastating is the major powers of the day got into direct and protracted military conflict with one another. we are not in that kind of battle today, and with nuclear weapons, one shutters to think about the trajectory of a great power war. but she's right in one sense, the west is collectively waging economic war on russia on a scale that would have been unimaginable just a year ago. the consequences of that are likely to be with us for decades. this new cold war marks the end of the era of globalization and integration that has shaped the international system since 1989. we're now living in a new world of great power competition, economic nationalism, and technological decoupling. the risks of this new war might not be nuclear, but they are sky high, especially for the united states. the sanctions against russia have been more far-reaching than anyone had previously predicted. they have included extraordinary measures, such as freezing central reserves. they've targeted the key vulnerabilities of countries in a world of globalized supply chains by denying russia access
by de -- to advanced technology. the author chris miller writes among the first affected sectors have been cars, trucks, locomotives and fiberoptic cables. each of which has seen production fall by over half. russia's imports have also collapsed. as the economist points out, when you look at some of russia's broad economic indicators, they're holding up better than expected. the imf had predicted its economy would contract by 8.5% this year. it's revised the forecast to only 3.4%. inflation spiked but is easing now. the reasons are varied. russia is not that globalized of an economy and the state has a large footprint within it. which cushion the population from external blows. but the biggest explanation by far is russia is a resource economy, a country whose wealth heavily depends on its export of oil, gas, nickel, aluminum and other commodities. and those have been largely
shielded from sanctions because the west realizes the world relies on these inputs and banning them would cause as much. pain to consumers as to russia the producer. washington sanctions have been well planned and well executed with one exception -- energy. if the goal is to reduce moscow's oil revenues, the sensible strategy, assuming you can't cut off all oil supplies, would be to allow petroleum to flow unrestricted while working on a long-term plan to reduce western dependance on russian energy. that way, for now, supply would stay plentiful which means prices would stay low. instead, western countries announced an embargo on russian oil. the price cap is an effort to correct these mistakes and essentially negate the effect of the oil embargo. so will the efforts to get the
saudis to pump mohr oil, which have failed. the saudis miscalculated how badly their decision would go down in washington. it will caught a rupture in relation between the two countries, but the largest problem is the west's incoherent energy strategy. it's underinvested in the energy it uses today, which is fossil fuels, based on magical thinking about the energy of tomorrow, renewables, which really will come the day after tomorrow. the greatest danger to the united states is that much of this economic war is being waged by america alone. using the unique status of the dollar as its weapon. because countries need to use the one truly global currency, the threat to cut them off from it allows for sanctions that can touch on goods and services that are not even produced in america. the dollar hit a two-decade high last month because of the lack of alternatives. but at the same time, many major countries from india to saudi
arabia, turkey, indonesia, the gulf states and china are searching for ways to shake off the hold of u.s. currency and escape the long reach of washington's economic power. as i have subjected before, president biden needs to make a speech, in which he explaining that it is only because of the unprecedented nature of russia's challenge to the rules-based international order that washington is wielding these weapons and they'll never be used in normal circumstances, or purely for parochial interests. he should be trying to keep the widest number of countries on board. otherwise, even if america won this struggle with russia, future historians might remember this as the moment when countries around the world began to reduce their dependance on america. and when washington lost what a french president once called the exorbitant privilege of holding the world's reserve currency.
go to cnn.com/fareed for a link for a link to my "the washington post" column, and let's get started. ♪ let's talk about the new world of economic war against russia, but yes, sir, also involving china and saudi arabia. for all of this, let me bring in "the new york times" columnist tom friedman. tom, welcome. the first thing i want to ask you is, we often don't think a lot about what a countermove of the other side will be. so we've been waging this unprecedented war against vladamir putin. how do you think putin is thinking about it, and what is his most likely response, though we're low pressure seeing some of them. >> well, fareed, putin's most likely response we've already seen, which is to i think, blow up that pipeline out of russia that was providing natural gas for europe.
in combination with our own ban on imports from russian oil. we're going to create a situation here where a lot of european countries are going to have a very cold and uncomfortable winter. and gas and oil prices around the world will be extremely high. and i think that's basically putin's hail mary, fareed, where he's going to throw as many troops into ukraine to hold the ground, hope that oil prices spike as high as possible in the winter, force people around the world to choose between heating and eating, and create pressure, he hopes, for the ukrainians to cut a dirty deal with him. >> when you think about this energy issue, you have said the heart of this problem we have not thought seriously about the transition to green technologies and underinvested in expiration
for oil and natural gas. is there a way to square the circle, to invest in these technologies so that we can have relatively low oil and gas prices, and at the same time, move to a green future? >> fareed, we need a strategy that maximizes three things. our energy security, economic security, and our climate security. the only way you're going to get that is if the biden administration does something it has failed to do, which is bring the leading oil and gas companies, executives around the table with the leaders and advocates within the administration of our climate policy, and come up with a solution that maximizes all three. if you don't do that, we're basically telling the oil and gas companies you're dinosaurs, please go off somewhere and quietly die after you give us a little more oil and gas to get through this winter. the message that sends to their investors is, hey,
don't invest new money in oil and gas, just raise your dividends, and buy back more of your stock. that's what's been going on. so we underinvest in our own capacity, meaning we can't make up for russia's losses and prices go higher. we need to have an honest discussion about this, and we're not. people are basically just assuming you can flip a switch, and there's just so much virtue signaling around this woke green energy that is unrealistic. i'm as green as they come. i cannot wait to get off the fossil fuels, but it's not going to happen in the short term and we have to be realistic about it. >> when you look at the saudi situation, it just strikes me that, you know, at the end of the day, this rupture shows that this is a very fragile relationship. i've always thought of america and saudi arabia as such different countries that it's very difficult to maintain this alliance when there's a rupture like this, because there's so much distrust between two very systems.
>> that's right, fareed. after 9/11, after the brutal murder of khashoggi, the relations between us and saudi arabia are frail, basically, and we asked saudi arabia to use its influence not to raise opec oil prices, not to side with putin who wants prices to go high so he can get money for pumping less oil. and the saudis made a calculation based on their interests, their budgetary needs, and basically told biden to take a hike. i get it. they've got that power. i don't think we're going to break relations with them in the short run. but, lord, how long are we going to have an energy policy that leaves us exposed that forces our president to go to saudi
arabia, or anywhere else, on bended knee and ask for more oil? we have the resources and we have to do it with a climate policy. but we have waited too long. there has to be a coherent, strategic approach to this, and get over the whole progressive thing that we can't talk to oil companies. if the biden administration doesn't get a coherent policy together, if the energy secretary, who has been missing in action, doesn't get the group together, we need to have a coherent policy that maximizes economic and climate security, if not, we're going to beg every six months for somebody else to fill in the gap. >> let's talk about china. there is a big difference between the economic war being waged against russia and the one against china. the china sanctions that have been announced, these measures to restrict technology, they seem very targeted, very focused. they're only on the highest end
of semiconductor chips, and so the effort is not to wage a war against china but to deny china access to the cutting edge of technology. it seems to me to make sense. what do you think? >> i understand why we're doing it, fareed. but this is -- in terms of u.s./china relations, this is quite a move. i don't know where it ends. let's begauge -- begin with something clear. china's president, xi jinping, invited this move. if you think about xi and putin together, we have the two strongest leaders in russia and china since stalin and mao. the difference is, though, but when stalin and mao misbehaved, it was the chinese and russians they can hurt.
now when the leaders of china and russia go off the rails, it affects the whole world. it touches all of us. and there's no question that xi is taking china in a very bad direction. so i understand where this is coming from entirely. that said, though, i don't know how china is going to react. china, fareed, controls over 80% of all the world's rare earths that go into your electric car batteries. are they now going to go tit for tat on that? i don't know. but once we get into this whole thing, we unravel the product of globalization, and in those 40 years, no great power war, hundreds of millions of people came out of poverty, and interest rates and inflation were relatively low. you're going to miss that era when it's gone. again, i have no sympathy with xi. where he's taking china is in a wrong direction, backwards.
but i do think we're heading down a road where i don't know where it ends, and it's not going to be good, fareed. >> tom friedman, always a pleasure to hear from you. we'll be back to talk about china. ug. you see that? that's when i realized we can't let another year go by. i think we're good. okay. let's go. mom, do you know where some wrapping paper... need to wrap something for grandma. uh, yeah. ready? yeah. this is the plan to finally connect with our family's heritage. grandma! start your plan today with a northwestern mutual financial advisor and spend your life living. ♪ your shipping manager left to “find themself.” leaving you lost. you need to hire. i need indeed. indeed you do. indeed instant match instantly delivers quality candidates matching your job description. visit indeed.com/hire
third term to xi jinping, kremgt his position to one of china's most powerful leaders. what agenda will china set for the next five years and beyond? joining me now is a former prime minister of australia, now the president and ceo of the asian society, and this year released an important new book called "the avoidable war, the dangers of a catastrophic conflict between the united states and xi jinping's china." kevin, welcome. i want to ask you about this party congress. we look at china right now and we see a lot of problems. we see a covid policy that isn't working. we see an economy that's stalled. we see a lot of distrust among china's neighbors, from india to australia. will any of this matter as xi jinping solidifies his power base, or has he got such an internal lock on power, that this party congress will just be a rubber stamp of his third term?
>> i think, fareed, it's important for us all to take out the rubber stamp. the bottom line, is despite the head winds you just referred to, particularly in the slowing of the economy, also covid social economic impact, and the external shall i say missteps, xi jinping's leninist control of the party is very, very strong. you'll see him remarkably appointed by unanimous votes. you'll see personnel appointments that are his closest supporters. and a continuation of the xi jinping policy line, probably, on the economy and foreign security policy, as well. but it really is shaping up to be a profound coronation for a leader who will not just be around for the next five years, but intends to be around for life. >> and so when we look at that, we are talking about a continuation of his philosophy which has taken china in a very different direction.
it was liberalizing checkly. xi jinping has doubled down on state control and state organizations. he's getting much tougher with the united states, much tough we are his neighbors. is all of that likely to be articulated now in a way that, you know, we almost get a kind of doctrine from xi jinping? >> well, fareed, i think the important thing about this party congress is to look carefully at xi jinping's work report to the party congress. and the reason i say that is it outlines the idealogical articulation of xi jinping's political, economic, and international policy line. i think that is where the real substance of this congress lies. what i've seen in the last
several years now, fareed, are three big change. xi jinping has moved the center of gravity of the politics to the leninist left, more party control over everything. he's moved the center of gravity towards the, marxist left, and at the same time, moved the dial towards the nationalist right in a more assertive in foreign security policy. i see those trends on balance as leakly to be continued, and in some areas strengthened. >> and somewhat happens with the issue of taiwan? again, it seems to me the
approach was this very long-term strategy of unification. eventually, 1.4 billion people on one side of the taiwan strait, they're 22 million on the other side, in the long run we will be unified. xi seems to be talking about a much shorter time frame, and he seems to be talking about unification by whatever means necessary. >> well, fareed, you're right. xi jinping has begun to reflect a timetable, an urgency about this question. not next year or the year after. and in my judgment, probably not this decade. but he has said you can't achieve china's ultimate national goal of national rejuvenation, which is code language for becoming the preemgent regional global power, xi jinping said you can't achieve that by 2049 without bringing taiwan back into chinese sovereignty. if you like, at the largest, most expensive scale, we're on a 27-year timetable. my expectation is he would want to be in that position to do that in the early 2030s when he would still hope to be around. but the clock has started ticking, unless the united
states, allies and taiwan can effectively bring about pill tear and economic deterrence against that in the meantime. >> that is a frightening prospect. pleasure to have you on. >> good to be with you, fareed. next on "gps," is the forecast for the american economy getting even gloomier? how about for the global economy? i will discuss that next. jpmorgan chase's ceo jamie
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could we be headed to stagflation of the 1970s? joining me now is the author of "homecoming, the path to prosperity." welcome. let's first talk about the prospects for a recession. how likely do you think this is? >> i think it's pretty likely. and look, recessions are normal. this is the thing, we have sort of forgotten that they are supposed to happen every five, seven years, because of monetary policy, low rate, you know, a lot of easy money after the financial crisis. policymakers have stretched out the business cycle, and we have all gotten used to the idea that recession, it's natural. >> what do you think is going to happen with inflation?
because the number was not just high, but it was surprisingly high, over 8%. >> yeah, the thing that really stood out for me was housing within that. really huge housing bubble in this country. again, housing is the epicenter of all the easy money being pushed into the system. you have bubbles and the pandemic. people work from home. you have bubbles in places that we've never had them. add in higher interest rates, and the cost of a mortgage on an average home is up about 50% year on year. so that's what i'm thinking about. >> now, one of the things you talk about in the book is how -- we're at an inflexion point, where the economy is going to change substantially. describe what that change is. >> we're talking about asset bubbles. about financial markets that are so unmoored from main street. and that's gone hand in hand with a certain kind of globalization within the last 40 years. it was all about cheap capital
from the u.s., and cheap energy, in particular russia going into europe. all those things are going away. so this is happening for a lot of reasons. there are geopolitical shifts. covid, war in ukraine. it's made us realize that it matters where we get our energy. it matters where the supply chains are. even if we didn't have such a fractious politics globally, we are moving to a more localized economy for all kinds of reasons. the environment. you look at the emissions cost in transporting cheap goods around the world, and this is something that's changing as we move to a price on carbon at some point. you look at the new technologies like added manufacturing that can allow you to make an entire tesla or an entire home locally. these are things people are concerned about now. >> so you outline all these reasons very well. the thing i'm struck by, if this is going to be a war which cheap
is not that important, efficiency is not that important, that's by nature structurally inflationary. so are we entering a world where we're going to be living in a world of inflation, because are choosing to pay extra, people are paying extra for national security, for the environment. that's inflationary. >> it's true, cheap isn't cheap. it's never been cheap for workers or the environment. but you're right, as supply chains become more resilient, semi conductors, this is ultimately a good thing, because it doesn't make sense to have 92% of all chips produced in taiwan. but yeah, that's capital expenditure and inflationary. what i would argue, though, is over the mid to longer term,
this is going to take us to a place where we have a more balanced economy. if you look just in the u.s. at this idea that cheaper televisions in walmart, cheaper products are somehow going to make up for the fact that there are flat or stagnant wages, it hasn't worked out. all the things that make us middle class have been rising triple at core inflation. >> if you add to the fact that your clothes and your goods are also getting more expensive, look, for people well off, you go into a walmart and goods are 25% more expensive, they don't notice. but for somebody making $25,000 a year, there's a reason that inflation has political instability. unemployment only affects the people unemployed and their families. inflation hits everyone, and it hits the poor the hardest. will they be willing to pay for all these things you're describing?
because that's the question. >> i think, fareed, that if it is made clear, and i think the biden administration is doing a pretty good job making clear we're shifting to a work not wealth mantra. we have to create an economy based on more than just asset bubbles. so yes, if there is a clear message we're in a bumpy period, the world is not flat, we'll get through this together and bolster labor when we do sign new trade deals. we're going to think differently, yeah, we can make it there. >> always a pleasure. next on "gps," we'll tell you about an election to be held in the coming week where is one of the candidates has already alleged vote fraud. i'm not talking about the united states, i'm not talking about a senate race. i'm talking about brazil's presidential contest. that story when we come back.
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earlier this month, brazilians voted in a presidential election where two candidates from the far sides of the political spectrum were pitted against each other. the right wing incumbent bolsinaro versus the leftist desilva, popularly known as louie. for months, bolsinaro questioned brazil's voting. both candidates have been seen wearing bullet proof vests in public. now the election goes to a runoff because neither garnered a majority in the first round. so where will this lead? we have the perfect person to answer that question, his latest
book is "the revenge of power, how autocrats are reinventing politics for the 21st century." welcome. >> hi, fareed, thank you. >> when you look at this campaign so far, moises, what strikes you as most interesting? because it's been a pretty raucous, chaotic campaign with a lot of rhetoric thrown around. give us your sense of what was most striking about it. >> how conflicted, polarized, divided is the country. how voting and elections -- around the world we have these elections we end up with not a unified nation but a deeply divided nation, and we have the numbers to show how divided it is. it shows how deeply brazil has changed. for example, evangelical christians a decade ago were single digits in terms of the population, now they are a third.
and they vote and they are active supporters of bolsinaro, and they are values kind of voters. so that's the deep change that's taken place in brazil is a very important factor. >> in this election, it does seem to me that you have a left-wing populist against a right-wing populist. but in most places in latin america right now, it's the left-wing guys winning. why do you think that is? >> well, the pandemic, you know, covid is surely one. the people are frustrated and whoever was in power during the covid pandemic is blamed, fairly or unfairly. a bad economy, high inflation, frustration, disappointment with the politicians.
the anti-politics movement, you know, i don't believe in anything, in anyone. they are all crooks, throw them away. that is a strong sentiment around the region, and around the world, by the way. >> you pointed out the rise of the evangelical movement in brazil. one of the things that strikes me as different about brazil is tell me if i'm right, it's quite a conservative country in many ways. and bolsinaro is tapping into that. >> this is a country, 70% of the country is against legalizing marijuana or legalizing abortion. a large plurality is against same-sex. so brazil now has a very substantial voting bloc that thinks along those lines, and
it's quite, again, i have to stress how profound a change this is to what brazil used to be. >> in your new book, which is terrific, you talk about how this moment has become so dangerous because of the erosion of democracy by these populist autocrats, by dictators who understand how to play the game of populism. and that seems to be to be something you see very clearly in many parts of latin america, but particularly in brazil with bolsinaro. >> we're seeing rampant populism. the essence of populism is there an elite that exploits the noble people and there is a charismatic leader defending the people being exploited by these elites. so populism is that, but then it gets super charged
gets super charged by polarization, by identity politics. what defines you with who you believe will be a better leader of the country. and, again, then you -- not knowing who to believe, what to believe, social media, and all that that fuels the polarization, that in turn powers populists. again, this is rampant in latin america. >> pleasure to have you on. >> thank you, fareed. next on "gps," it's been so inspiring to watch the protestors in iran. but the question we keep coming back to, will they succeed? we're going to look at some data that might give us a clue, when we come back. our most advanced formulas. infused with salon-inspired ingredients. like hyaluronic acid and pro style technology. pro-smooth, pro-shine, pro-confidence.
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and now for the last look. the protests raging in iran have been deeply inspiring, sparked by women demonstrating against the repression of a brutal regime, that has made control over women and their bodies a central tenant of its rule. as "the new york times" notes, the protests have spread to include oil workers who have taken to the streets shouting slogans like "death to the dictator." this is powerful stuff. but are the regime's days numbered? in a fascinating piece in "the new york times," max fisher notes two puzzling trends. all over the world we are seeing an astonishing rise in protests, but this rise in frequency does not appear to correlate to a rise in efficacy. in fact, quite the opposite. mass protests are now more likely to fail than at any point in the past century. this finding comes from a group of harvard scholars who maintain a
data set of protests that have either sought to change a regime or to gain territorial independence between 1900 and 2021. that data shows that the number of such non-violent protests have grown dramatically in the past 20 years. many of these demonstrations were remarkable. the arab spring, for example, or the recent protests against belarus's brutal dictator alexander lukashenko. the harvard statistics show that of those protests initiated in in the 1990s, 64% succeeded. of the protests initiated between 2010 and 2019, just 42% succeeded. and of the protests that began in 2020 and '21, just 8% succeeded in their aims, though that data is partial. what is behind this striking drop? perhaps the most illuminating place to look is the rise of social media.
it's easier than ever to watch an explosion of anger. just go online. but as fisher writes, it's become easier to organize discontent on social media, the traditional activist organizing that has historically led to change has weakened everywhere. the truth is, as he notes, that street protests are just one piece of a multi-prong strategy required to affect change. the others involve forging alliances with other groups with overlapping aims and meeting and pressuring political elites. the scholar samuel huntington pointed out the key to democratic change was to induce cracks within the ruling elite. achieving regime change or significant democratic reform needs more than just likes on facebook or even bodies on the street. it needs effective organization and sustained strategizing. historically, major successful protest movements came with an
almost military level of organization and hierarchy. take one surprising example. the civil rights movement of the 1950s and '60s. as malcolm gladwell explained in 2010, that inspiring movement was not some spontaneous call for justice, but rather a challenge to the establishment, mounted with precision and discipline. central to its success was the black church, which gladwell notes had a very hierarchical structure and organized standing committees and other groups that reported to a central authority, the minister. hierarchy, not decentralized democracy, gladwell wrote, is what is required to effect systemic change. look at the montgomery busboy cot in the '50s. when rosa parks was arrested for after she refused to go to the back of the bus, civil rights organizations and black churches publicized a boycott to be held on december 5th, 1955.
about 40,000 people in montgomery refused to take the bus that day. this protest lasted for over a year. a young charismatic pastor named martin luther king, jr. emerged as its leader, to encourage sustained participation, the boycott's organizers had local black churches work on keeping up morale and organizers also arranged a free carpool service. black cab drivers were compelled to charge black passengers just 10 cents for a ride, the local bus fare. eventually it led to the supreme court's 1956 bus decision that bus segregation was illegal. in a broader sense, the passage of the voting rights act never would have happened without the years of back room meetings between martin luther king jr. and lyndon b. johnson. this marks a new reality as one of the scholars who maintains the database writes. in a recent journal article.
non-violent protests now no longer has a statistically significant advantage over armed insurrection in terms of achieving systemic change in the country. let me be clear, that does not tell us much about iran. individual countries can always be exceptions to a trend. but the trend is a troubling one. thanks to all of you for being part of my program this week. and i will see you next week. how'd you know that? the company profile tool, in thinkorswim®. yes, i love you!! td ameritrade. award-winning customer service that has your back. your mission: stand up to moderate to severe rheumatoid arthritis or active psoriatic arthritis and... take. it. on. with rinvoq. rinvoq is a once-daily pill that tackles pain, stiffness, swelling. for some, rinvoq significantly reduces ra and psa fatigue. it can stop irreversible joint damage. and rinvoq can leave skin
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