tv After Words CSPAN August 27, 2015 10:54pm-11:52pm EDT
rights issue but as an economics issue. we talk a little bit about that and where we need to go and what would your engender in 2016 inclare guest: one of the problems in the united states is it's the only country engaged in mass incarceration. we have 5% of the world's population andce those are in prison. we make it very difficult for all of those people have been put in prison to get back into the labor force. for a large fraction of african-oolerican young man, instead of going to college they spend those years in training and that's not training them to be productive members of our labor force. host: particular lee when you don't have those back, you can
get a student student loan, financial led if you have a drg conviction, the fact that you can't get housing support. there are so many issues that are really saying this is a permanent designation in society. guest: als, you're scarred. again i have argued not using your human resources is one of the worst ways for managing your economy. so we have these large numbers of people who may have made a mistake, amshough many cases our judicial system made a mistake. i don't want to jare we ougth j to be fair and hones, sometimes there were mistakes made. this goes back to alarence of group schools, absence of support that would have enabled them pre-k to do well in school. their shared responsibility
here. whatever the history, the fact that given where they are and were not facilitating that rejoining the labor force. the the good nlits for the politics looking at the bright side, is some of the conservatives now woe faied about money, realizing were spending more on prisons in stead of universities have wch n our and said this is not the bt way for managing an economy. ceswant to shift attention to another area, were very much worried about the diminution of our global influx. our military power has shown limitation, we can even win a war in a litr ge country, a
% action of our size. our powers about our example, our exoolplrri equality, equaliy of equality of opportunity, the way our system works. i have to say when i travel around the world now and people say and see the level of our inequality, the level of our diibrimination, the level of our incarceration, the lack of opportunity, they're not sure the oolerican m of them except if you're the 1%. shose are very entildsiastic host: this is been a wonderful conversation. cesdo want to end this conversation was something that could give us a little bit of sope. been talking about the great
divide in inequality for your whole career, as you go around the country talking about this exceptional book which is a collection of stories you have been telling for the past few years with some great nlit essas and personal reflections, what are you hearing that is given you sense of optimism? is there anything that is going on, i'll give you some help in the fact that low-wage workers are organtting is of the fact that black lives matter has become a call and people are gerving out of their cdiifort zone? what gives you hope? guest: you s led e i ctly what i was going to say. the fact of the issue is that is finally on a political agenda. if you don't recoghe pano the problem you're not going to sell it so at least were recves he pg it across the spectrum. the second thing is even though
70% of all americans believe ther sus a lot to be an increase in minimum wage, something's wrong about an economic system that hasn't given a pay up a race to the bottom for almost a half century, that not only can we afford it, again i think it's hurting our economy not to do this, and that there is this grassroots movement, congress gridlock in washington and people have said we don't care visit grnomlock in washington. they said that were going to do it in our cdiiy, rhe pty will me 800,sys0 people out of pncrerty, 700,000 increase in minimum wage, this gives me hope. it's across the spectrum. it's young people. when i give these talks and young people % dii all of the world cdiie up and thanked me and they say we need this kind of voice because
we don't want to inherit, we don't want to live in a society that is marked by disgrace. we want to live in a snciiety where we have a more share prosperity. host: the book is out rigth j n, it's a great divide. thank you so much for being who you are, being oseren the lonely voice in the world and for showing that economics per session isn't so bad aserer all. thank you so much. guest: thank you. >> book tv in prime time can continues % nomay. apm lincoln chafee on his book against the tide. at 8:5st ap.m., rcesdublican candnomate carly the arena risig
to the challenge. at nigth j 40 jooles webb discus his boch i heard my country calling. books by presidential candnomats starting at c:0st aget m. eastern here on c-span2. >> coming up on c-span two, a diibussion on n pobal economic % eedom, after that book tv in prime time continues with books about economioic. michael rcnter discusses his book, going for broke. then americans for tax rperorm n his book and the irs before it and suss.
>> this weekend marks the tenth anhe pversary of hurricane thata strake in the gulf region. friday former presnoment george w. bush, and former gncrernor haley barbour honored the hurricane to trina first re3 sonders in a ceremony. wedonl bring it to you live brig starting at noon easte on on have 3 sant the t s me. and hope that camera shows how ildge the crowded.
s me. today this is a wonderful event, it's been sanom that heaven is a lishaary, well, well if that is the case heaven has gone outside torimey and were in heaven at ts national book festival. >> young people are not the leaders of tdiiorrow, i felt at sometime i am a youth leader for today let me see what i can do. s me. atlantic showing this red blue map but when you went and interview people to divnome wasa lirvle divide, the idea that the country itself is as polarized as washington is just wrong. s me. realize whatever they have done in lge to be recorded and ought to be passed onto the next next generation, that's the way we learn. we learn for the future by trying to understand the past.
all of us have a past. >> this is a great question it goes to the heart of all the regestions we've been talking about, it's actually to the point, we realtte there was no way we could tell the whole story. there is no way we could be short of an encyclopedia or having a story read like a telephone book. of course the telcesdhone book s not a story. s me. are open for woman now, when i was in lost school i graduated 1967 there's 13 women 13 women in my class a 500. torimey the law schools are 505e s me. understanding what he did is that he never put profit a of the puwonic good.
these areas belong to the american people for generations on born and they needs to be handed on. >> i made a career out of my love for books and to help 3 sread that love i help find the texas book festival and then the national book tarstivalridbut while i love reading i never never thought i would write a boch . cert lenly not one about myself. >> the goal in some ways is a sense of urgency. it glf s to te oldest people in the family and to get the stories before it's too late. i've had a father and a d urghtr in los angeles who came together and during the talk hearing about the book the d ur3 huter said to the father, i'm taking you to the coffee shop now and you're going to tell me stories. >> i think when history looks back at 30 plus million people
that's going to be quite a change, martin luther king said the uhe pverse eing thienpor sli think is a bending bending towards justice. there are things wrong with the health care bill but you that ww what they would've said the important thing is to pass ieven once you pass that i womes easyo go back and fix it. >> i believe the narrative of historbacns true calling is to bring back the dead. i tried to do that not ofiy with the outsnome figures your familiar with but also others you're less familiar with. s me. don't think i can afford ten years and there's no big person
to go back to easily. sdiie shainging all my guys in the rom at the same time and ibu going to write about leadership, that's really what i care about underneath it all. s me. regestions called in from c-span and. >> next former secretary of commerce for international trade discusses global economic freedom in the 2016 presidentbal candnomate. s me. welcome to the heritage founrimetion. i womes a deligth j to have allf you here this morning, at the end of auguseven people are stil
on vacation 05t school is starting in some areas. it's starting to tarel like maybe washington is gerving back into the care of things so we're all too happy to help the process along. very hg bpy to be here for the release of a new report of the heritage foundation, is thether5 is mobal agenda for economic freedom. here's a copy of it. this is a sok dy that is producd in tandem and also the institute for econdiiic and freeddii bothf which are distinct entities inside the heritage foundation. i'm e3 secbaclly ha- for two reasons. one is to host my good friend grants as a keynote speaker, hapant is one of the smartest people i know in economics.
he is also a true gentleman. most importantly he is a good liritar player, he's a fan of te blues in the jazz as i am as well and i that weeep on tealngm about putting together the economic freedom group as the newest thing in rock, but it won't sell. something's wrong with the term cesliress. the other reason is i was i was the founding editor of the index of economic freedom and here's thethere's n5 additif that index. this is what the study is based upon, we started a series of these is mbral sok dies, the lat of which will be discussed today when i was vice preldent of rcrentage. ibu proud to see these reports continue and to see washinlobon grom a i thih it's one of the most idomortant things the heritage foundation dlf s in my opinion. it's e3 secbaclly timely to have this discussion today because of what's hg bpew ng in china, and of course impth the u.s. stock market. the problems that are causing the meltdown of china's stock
market are not limited to china alone, many of the same economic faile mes that h urnt china afft the rest of the worlds. huge debts, corruption, lack of e span3 saren ge, lack ocare the rare ce of law and general lack of economic freedom. as you will lea on from teathas difanusn many mistakes china and others make are always also be in debt by the s led miw stration. we should not be surprised that that our economy is in trouble to and we have lost the particular ability to lead the world out of trouble. which culm se me all of oe m rcrticipants, particularly grat will be talking about. to get us startei hapant impll deliver sdiie rema, he wears many hats and has a wide range of experience in e spade and econdiiic policy and the law. 2001 to 2005, roughly the same thousand fivsome rou3 huly the same time i was at the state department, grant was secretary ocare comiliaerce of national t. a number of historic trade deals were enacted while he was in
ofthat ce incas ading the normalttation of trade relations with china and the trade and development act ocare e'00. before his tene me at congress used chief international trade counsel to the senate finance comiliaittee which is as top tre policy position in congress. torimey he he is the princts,al managing director, a trade and invest meant firm, he was a na'ofessor at georgetown univerlty, but a3 the o senior advisers to the center for strategilovand inte on ational st that weeies. after hapant makes his remark will be joined by commentary by bill wilson was a recent scholar of the regents study here at heritage. fill it for a naveber of years n beijing and a3 the o spent time in mouse now, he has a unique perspective on the economies of these two countries.
also jim roberts, research fellow for the economic freeddii and hapowth eand center for trade and economics here at the heritage foundatiows cesimpll ask grant to cdiie up d deliver his remarks and then we impll hear from the other two. thank you very much. >> thank you can for that kind ine speathl where when sdiieone glf s throuh your bio you feel yourself aging all over again so ibu not se mei realeciate the introduction. the blues part i really lwas that's one thing that that weees young. my job here is first of all to g bpl urd the release of the is mbral agenda. i look look forward every year to the index coming out bec urse it is a benchmark all inst what we can
see the underlying institutions actcan lly na'diiote it or undee it. i'll come back to this at the end but the problem of course that you see rlirelected in the global agenda report that is coming out is where the uw ted states and i'll put it this way admired at this point and has been for some time. the united states has to be a beacon in terms of economic freedom. we can't depend on hong that wen the absence of the united states assuming that role in the global econdiiy, there is no alte on ative. we have to be the defenders of our own freedom and understanfe3 affects elsewhere. where want to start and while i
rok w nu thatthe o- jim and the foundation has given me is an opporok w nu both to reflect on my obra ekeseriencsoe but also look at the other system. i will start rlirelection and tn 3 send time on the backdrop of the study and that i will come back to why thih econdiiic freedom should be essential to the 20016 campaign. that rst on the personal snome. ceswher what i lwas fortunate son of jonas, he was a refugee diiidii litentianbac, iy before him here is achieved a new name courtesy of immigration when he cwhere to ellis islani
he was extraordinarily conscious because of his life experience of the freeddii and joyed in his adopted country. he could measured against the freeddii he had lost in litentianbacs,when y father was born in 1922 the first year lithuania had g lened its independence in rou3 huly five centuries, and the course of his boyhood and teenage years he imptnessed the erosion of that independence from within the society and without. and then folloimpng the diss urction of the country through the nazis and finally the sfilit reinforces 9ive days each at
leningrad. as a soviet forces approach my father, who had gone under hapound to relst the soviets try to persuade his father and family to leave. his father re@ wsed arguing that things would return to normal after the war. . grandfather in a letter exna'essed his sorrow for not having followed my father's advice. he had grobra up under pressure and to an extent had succeeded and he couldn't conceive of how a different li3 hut mom. and w be in a totalitarian society. in the end . father escaped with only his lster, they, they made their way often hiding across europe and evenok ally on a bme ct to e them to sweden. in the event to the german patrol boats pass them and my father had to simpm the last mile in the cold waters of the baltic.
fortunately both in my father's litar and his on his luck held. as he was in stockholm and was ok a fe thenng for rlireugee staok se met my mother, who is serving as a foreign service officer. at that point it was the whererican embassy in stockholm, my mother would tell the story that she walked down the hall impth a hotel diplomat and saw this man who is 6-foot 3 inches, she sanom she fell in lfile immediatelporo my father told td the story from the opposite perspective that he cwhere down the hall and saw this beautiful woman nearly 6 feet tall herself and saw a visa to america. now those days the foreign
service was a lot less and li3 hutened as it was teathay. as a woman you are fired if you're married even to u.s. citizen. so when they married in 1949 ththe is where i was born in on the fortunate son of all those even ats,roughly 70 years have passed since my father met my mother and that at the hotel di fediiats,it was ironically was ironically at that time and stocnday, another x patriot, log before i read hayek i knew the baseline of his argument. i i had brseimpmed it with my father along walks of the mississippi river. we would th to enjhe f the beauy of the es ws but eveh so often, which of course finds is young bobef my father rete mned to mse really a a very solemn way to try and explain what his
experiences has tanor and w ande lngle statement that summarizes his lesson is one that returned to me when i was rereading hbact in pretelration of this talk. he turned to me and said grant, somece wy someone impll offer yu securinu and return your freedom, you should you should never take that bec urse you wil end up with out either one of them. and abroad outlined that was hiatt's reasowas this is what he warned about, it's just as relevant today as it was the time my father was explaining it to me. it can't be dissected neatly between the political and econdiiic grounds and for that reason hayek warns that the na'ogressive are was sdiiethingf a death sentence for a free society. he underscored quoting that the
controlled prow nction of wealt, the control of human life itself, he, he sou3 hut to remind us what we forgottewas as he put it the system of private property is the ecarantee of freeddii not oloiy for those who own property but scarcely for those who do not. only bec urse cons onol meae p divided among many people that nobody has complete power over uss,we as indivnomsoci3 the can decnome what we want to do for ourselves. hamerk understay,d that the diiieedo liof indivnomsoci3 the to shape their own lives is associated with the growth of cdiime prope. that is a ss ononger ekeslanatin of the rationale of free trade and his famous discretion of his dit asourse using portuguese wie in english cloth, it's about about the diiiee part not the
s onade part. at the end of the day it's about the right of the indivnomsocil o chay,se, diiiee of course by the government, or by another person in their se mnienu that vindicas the nomea behind free-s onade. n fact recognize the erosion of that economightdiiieedo liwas tt notiniust interest of the individual entrepreneur but the basightindiviw nalis lithat we inherited. the tragedy was it was largely people of goodwill, who pretelrd the way forward if they dnom not actually create the forces that ultimately dess onhe f that inheritance. indeed a gay,d subtitle wou
most obvious example was the affordable care act which affords every american to provide a certain package of health insurance regardless of whether they need for it. that active compulsion is justified on the ground of making health insurance affordable to every american. but that ignores is the extent to which it paves the way for other erosions of freedom, both economic and political. seen in that light, pres. obama's obama's willingness to ignore the requirements of the affordable care act whenever its
political advantageous is systematic of the broader where the end justifies the mean. regardless of what that means in terms of respect for the law and the constitutional limits on executive power. the fact of the idea that the affordable care act the heritage foundation simply underscores the problem and confronting the political at any particular moment it's easy to forget that liberty is the ultimate end we seek. hayek saw that clearly as he noted the principle of that the end justifies the means is regarded as immoral or not moral. there is literally nothing which consist must not be prepared to do if as hayek put it serves the good of the whole. progressives today much like the socials of hayek's time are guided in their and diapers by
the private individuals of the power they possessed and into a system and transferring that power to society or government that they are they extinguish power that disenfranchise people. what that implies is to collect a good defined by individuals who claimed. as young man in austria he witnessed the german and political economic thinking. we rejected the idea of the individual in favor of the interest. at this distance, we tend to see german history of the prison of world war ii, the rise of socialism and holocaust. what he sought to remind us of the evolution of german fought predated and prefigured both the embrace of socialism it in the late 19th century and the emergence of nazi -ism.
the theory of the collective good cannot be realized in practice without compulsion. key to the practical instrumentation is the promise of security. this is required from the chaos that engulf the country in the aftermath of the armistice that ended world war i, the promise of security, indeed the times allowed propaganda to defined as security. freedom from choice rather than freedom of choice. as as he pointed out is far from increasing the choice of freedom, the promise of security is the great step to it. this explained why my father words echoed in my mind. in closing, turning to this year's report, i know the panelists will have more insights there but i want to
focus on one in 2020 we fell from the highest category of economic free countries and the latest index of economic freedoms and has been stuck in the ranks of the second tier ever since. that to my mind represents the core issue of the 2016 presidential campaign. at the end of the day we have to determine to ourselves where we are willing to vindicate the idea that it economic freedom and whether we'll pursue that not only for selves but make it a core principle of our foreign policy. an organizing principle of what we're doing that and integrate those objectives as part of our foreign policy is we've never done. any even in the reagan years it would have not been fully integrated as part of the agenda that we need to pursue. the reason we need to pursue it is in our interest and in a broader idea and acceptance of
higher government spending and it reflects the continuation of the interventionist stimulus policy that grant was making in the united states and in the other country. our global agenda is based on these index and their calculated using four pillar areas and ten indicators. the sensitive issues they represent surface as challenges in every region of the world. for example, while international trade plays an increasingly significant role in the economy of the united states and other countries, unfortunately negotiations for further global trade liberalization through the have gone to a halt. the global agenda notes bright spots for global trade. the ongoing effort of a trance pacific trade agreement.
as documented in 2015 index, protection measures industry-specific subsidies excessive enforcement actions and regular tour measures reduce the efficiency and competitiveness and diminish the prosperity of all nations. all countries should resist these counterproductive policies and the united states could lead that resistance. .. >> ..
my colleague will cover the rest. the -- in central and south america the scores range from excellent in chile to abysmal in cuba and venezuela. with major players such as brazil, the world's sixth largest economy, registering comparatively low scores because of protectionism and a have-handed regulatory regime. there are some positive regional
trends. mose of the world's ftas are based in the region of hear regional par tis -- regional participants, especially the pacific alliance, thely, chroma, costa rica and peru. and -- economic free dome scores have plummet. while members of the pacific alliance have full access to intermarkets strong liquidity, edmond tear and a positive inflation outlook. the others face -- liquidity vulnerable, and negative inflakes outlook. -- reforms undertaken in mexico that could create numerous amoute actually beneficial opportunities but urges mexico to remove the remaining mon
lobbyistic par. the benefits of nafta substantial should be expanded through the tbp good bilaterally reremove remaining barriers international afraid and investment. to the rest of the world and europe we see the former uss countries are still struggling to achieve more economic freedom, dr. wilson might go into that in more detail. in sub-saharan africa, despite some setbacks cause build turmoil and ebola, it's one of the most improved regions in the 2015 index. indeed six of the ten larger scores improvements in the 178 countries registered were by subsaharan countries. nonetheless the continue to underperform when it comes to -- result in more broad-based growth.
more critically, the continuing existence of uneven economic playing fields means residents are being left out. the global agenda that calls for prioritizing the fight against endemic corruption in africa, and the fragile protection of property rights and inefficient entrepreneurial environments in africa. elsewhere in africa, kenya is in the process of devolving its highly centralized governance and empowering local government with direct budgetary control. this devolution process could result in decentralization of power and limit government. but the devolution requires improving budget management and oversight capacity. the agenda encourages african
economic immigration, formal -- the lowest of any region in the world to maximize the region's trading potential, a serious and bold plan needs to be developed into put into action, those steps have being taken, support by the africa union. however, complex custom unions, administrative procedures and burdensome regulation hinder these efforts. the agenda encourages more investment in africa and whale fti has grown substantial it has been hindered by political unrest and investor concerns over taxation issues and the absence of specific protections. countries such as china, play by different rules in africa. their opaque investments and distractive industries may help build a port or highway but
carry with them potential bitter legacy of corruption and men tim. many of the -- nepotism. many of the same schemes are present in the middle east and north africa, where countries have undergone political and check unheavals during the arab spring. as a result the gradual rise in economic freedom that had been recorded in recent years has come could a halt. structure problems abound and the region's unemployment rate is among the high nest the world, fueling more instability. these problems are complex and rooted in decade awer to tarean -- authoritarian rule. political lead leader will be reluctant to share power if that
diminishes theriac toes wealth. reforms are required to reduce the state's role in the economy and people's lives now. i'd like to turn the floor over to dr. bill wilson to cover the rest of the world, thank you. [applause] >> good morning, nice to be here. my presentation will be a built different. i recently lived in beijing for three years and return to the united states after living in put's moscow for two years. and so i kind to focus on what is going on the ground in these countries, after talking to government ministers, business people and property developers. so i have about ten minutes to talk about china, india and russia. so, if my remarks are quick, i apologize. we need to leave time for questions and answers. first the big picture about asia. the tsunami 60,000 feet -- the
view from 60,000 feet, my feeling is strongly that after being the the global economic engine for a long time in asia, especially east asia, economic growth has clearly peaked big-time in asia. for a number of reasons, three quick reasons, number one, demographyy. look at china, tie juan, sing powe, hong dong, south korea, japan. you hear fertility rates well below two, approaching one. compared to 2.1 in the united states. so, much of asia, especially east asia, that this phenomenal demographic dividend for three decades and is now entering a democratic deficit in the next few years. reason number two, the china story. china now accounts for 45% of
asia's gdp. and its growth in china is growing -- is slowing much more than you think it is. reason number three, someone no one is talking about, especially outside of china. since 2008, much of asia, especially east asia, fell through this economic crisis. why? credit growth. debt. there's been an enormous -- and i'm not just talking about china, even outside of china, an enormous increase in credit growth. if no one really has talk about all throughout asia. in fact if you look at total debt, household, corporate, government debt, as share of asia's gdp, unbelievably it is higher now than it was before the financial crisis in 1997. so much of asia, especially east
asia, has manufactured growth the past six, seven years, built on a surge in liquidity and debt. a huge story. let's switch to china for a few minutes. given the recent slowdown in china this question is, should the global economy be concerned? the short answer is, absolutely. here's why. china, as you know, is the world's second largest economy. at current exchange rates, $12 trillion compared to the u.s. at 18 trillion. there's no close third. it's now double -- it century's a japan in 2010 and already twice the size of the japanese economy. it's the largest trading nation for 75 countries. and is by far the largest importer of commodities in the world, which is a vital export for many, many emerging markets. this is why commodity prices are at a 14-year low.
and over the past seven years, china's accounted for an incredible one-third of global economic growth. so, naturally, it's a concern for the global economy if china enters this so-called hard landing, which i think is -- i'll go into detail -- mathematical certainty. not based on entirely tuition. think it's a mathematical certainty that china has to enter a financial crisis, economic and financial crisis. the question is whether it occurs sooner rather than later. we have seen the chinese stock market collapsing about 50% over the past month or so. is that a huge concern? interestingly i would say, no. that's not a huge concern. only one in three chinese own stocks. and only about two percent of chinese market capitalize asia
are owned by foreigners. so the contagion effects of the fall of the chinese market i don't think will have large effects if it falls further, which i believe it will. i think probably erase the gains it had from the previous year and a half. not there yet but it's moving there. we should center on the -- the focus should be on the economic fundamentals that are dramatically showing china's economy. what has become crystal clear in my opinion, is that china's economic model over the past three decadessed was built upon largely three big pillars. of course, exports. fixed asset investment, and of course, don't overlook the property market. and i believe all three of those pillars are well past their expiration date.
if you look at the china's current account surplus, a broad measure of the trade surplus, as recently as 2009, it was 10% of gdp. guess what. last year, 2014, it shrank to 2.1% of gdp surplus. so con temporary to conventional wisdom exports to china have not been a significant source of economic growth since 2008. that engine is gone. and china is not going export its way out of a recession this time, given the state of the global economy and the fact that china already has a 13% share of global exports compared to -- it was 2.5% as recently as 2000. i've talked to a lot of property developers in asia on the ground, and the housing market, of course -- the housing market is much more important than the stock market in asia.
it's a critical recipient of household savings, and it's supported by many developers in china -- get this -- of having the housing glut of unsold units of 70 million. unsold homes. 70 million. to give you some scale tech height of the u.s. housing crisis, the backlog of unsold homes was 1.5 million. now, if that figure is correct, 70 million, then you should see housing prices fall. they have to fall. in fact they have been falling. housing prices in all the major cities, tier one, tier two and tier three cities housing prices have been falling for two years. the housing sector is the major source of savings for the chinese household. the housing prices are falling. the first time in decades. then we have domestic investment, which until the last two quarters, has been running
at a mind-boggling 50% of gdp, leading to massive excess capacity and major industries, steel, cement, operating at -- like 70% capacity. and growth, which i'll go into later during question and answer -- i highly doubt the growth is 7% right now from what i hear on the ground and from what is being released. like the purchasing manager's index, et cetera, et cetera. growth has showed to 5%, and more importantly, continues to slow. generate 5:00% gdp growth.
so seeing precipitous decline on return on investment and this has been reflected in the stock market. 80 parts of the stock market capitalization of the shanghai composite, their major benchmark -- 80% are state-owned enterprises. 20% are private. and i'll finish with china, i got to keep moving here -- the anticorruption campaign, the scope and intensity is far greater than anyone, anyone expected. xi jinping is the strongest leader china has had since mao, and in his first 18 months, nearly -- get this figure -- nearly a quarter million officials and others have been held in detention or formally charged with corruption, a quarter million. this is more about clearing the old guard.
this is much bigger than that. so far, well over 100 have commit suicide. let's move on to india. let's see if the picture is any brighter there. let's quickly -- talk about modi. the first year in office tells us a lot. the intentions of an administration go back -- look at maggie thatcher and reagan in their first 12 to 18 months, quite revolutionary. this is when political capital at its peek and bold initiatives implemented. now, evaluating moddy's first year, if i had to give him a grade, i'd give him a gentleman's c. expectations were high and modi played an important role in setting expectations. now to be fair in india right now, most economic indicators over the past 12 months, 18 months, even before he took office, have been improving.
inflation falling, foreign exchange reserves are increasing. the fiscal deficit is shrinking. a lot of because low oil prices. they scrapped a planning commission, a relic of socialism in central planning that was good. he abandoned costly diesel subsidies. so he gets some credit there. the bottom line is, there have been no really what we call big bang reforms, which india so sorely needs right now. and india has its own demographic problem, but it's different. india is getting enormous growth in its working-age population. en cline which began declining in 2012. in fact, india has to create 12 million new jobs a year. and under current conditions they're not going to do it. not 12 million. so far the only economic policy that required guts to undertake
was the rollback of the law that makes is hard to acquire land. this is critical. business needs to acquire land, and government needs to acquire land to build infrastructure. and that law has been held up in parliament. and the goods and services tax, which was meant to simplify this nasty, complicated tax system, it was no-brainer. should have easily passed the first year. it did not. tells you a lot. the bottom line, i think -- westerners looking at modi at the ends of his first year, there was their percent sings modi would be another thatcher or reagan. thatcher and reagan wanted smaller government. that's what they worked for their entire lives. smaller government. i don't think smaller government was ever modi's intention.
he didn't want smaller government. he want more efficient government. and is there's a very big difference between that. i'll finish with this. a very quick comment on mother russia. i don't know if you have been there since the 1990s. i lived in moscow for 24 months, but it's changed radically since then 1990s. go back if you have a chance. don't tell them you're american. you're canadian or english. they can't tell from the accent. most can't. most of them can't speak english. but even during the '90s the duma, the russia parliament, had power. they almost impeached yeltsin. today they're a rubber stamping for vladimir putin. they have no power. they challenge putin. putin would simply dissolve then
duma and jail the leaders. the media in the 1990s, despite the chaos, was relatively free. i'm telling you this, the media, print, radio, tv, is completely controlled by the kremlin. all important decisions in the country go through the kremlin. the state is essentially run by the internal security apparatus. make no doubt about it. you can't exaggerate the economic problems in russia. you have seen recently some good news on population. the population is actually stabilized the past three or four years. why? one reason why is because per capita incomes rose because of higher oil prices until recently. another rope is birth rates in russia -- at that time the soviet union -- were high in the
1980s. that generation is having babies. what happened to the birth rate in the 1990s? it crashed and burned. so a decade from now you'll see the resumption of a very rapid decline in russia's birth rate and population. and i have to be honest with you, the russian economy, which i studied two years, is not very complicated. it's a petro state. it's more petro state now than it was eight years before, before the economic crisis. i takes $110 a barrel to balance the budget. unfortunately for the kremlin, we have oil now hoverer around 40 some bucks a barrel. we're not even close. the difference is that they have -- they did have massive exchange rate reserves, but you can burn through those very quickly when you're -- russia is in recession. the economy is being