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Sovereign Internets, Scholarship, and Business Risk. Publishing in Controlled, Fragmented, and Complex Markets
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Sovereign Internets, Scholarship, and Business Risk. Publishing in Controlled, Fragmented, and Complex Markets
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Language: EN.
Segment:0 .
IAN BREMMER: Good morning, everybody. It's kind of a fun way for me to kick off a day. This week has been absolutely impossible. And this is almost like a breath in the middle of it. And not just impossible in terms of the United Nations, but just impossible in terms of what the news cycle right now looks like. I mean, you know, [AUDIO OUT] I like talking about the issues we're going to discuss this morning. But we do have some Q&A. And I'm not opposed if someone asks me what the hell I think about this impeachment situation.
IAN BREMMER: I actually tweeted out this morning that if there's one thing we can all agree on, it's that it sucks to be Ukraine. I think we can all-- [LAUGHTER] --whether you're a Democrat or a Republican, it's just bad to be Ukraine, right? I mean, they've been-- I mean, it's not new.
IAN BREMMER: It's historic that they get taken advantage of by everybody. But I was actually at the-- at the UN yesterday, someone told me they're basically Palestine in Eastern Europe. That's kind of what-- I know. there's a lot of dark humor at the United [AUDIO OUT].. But that's not what we're talking about.
IAN BREMMER: We are talking about something related, which is an unwind that is happening in a piece of globalization that's actually pretty relevant to what you all do. And that is this coming war in technology. And before I get into that, I want to give you two different frameworks to think about that.
IAN BREMMER: The first is an economic framework. And the second is a geopolitical framework. And once I [AUDIO OUT] all that kind of thing. So what do I mean? [AUDIO OUT] --right? I mean, the thing that has excited us, the thing that's been the good news story is that ideas, and capital, and people moving faster and faster around the world, becoming more efficient, has driven extraordinary economic gains, unlocked the kind of growth that none of us have ever seen in the history of humanity.
Segment:1 Segment 2.
IAN BREMMER: I mean, the last century, we've put 20 years on people's life expectancy. We've brought a billion people out of absolute poverty over the last generation. And if you go and talk to Bill Gates and say, what are you excited about, that's the story he's excited about. Hans Rosling, who many of you have read, Factfulness, the wonder [AUDIO OUT] --some warrants or not, the fact was, we all were sort of aligned to US-led global institutions-- the IMF, the World Bank, right?
IAN BREMMER: I mean, Bretton Woods Accord on Currency-- they sound like global institutions, right? In the same way the World Bank-- the World Series sounds like a global [AUDIO OUT] --from the World Bank, it's not global. It's about US-led [AUDIO OUT]. The problem is that, very soon, the world's largest economy is not going to be a free market.
IAN BREMMER: It's not going to be a democracy. It's going to be a state capitalist authoritarian regime. And there are a lot of people that are just wrong, have been wrong about China's development. I mean, generally speaking, in the West, the view was that as China gets wealthier, they will either align with our values and open up politically or economically, or they'll fail.
IAN BREMMER: That was wrong. And because that was wrong, I'm here talking to you about this issue right now. So what's the economic framework? The economic framework is that, if you look at globalization, that trend I just discussed that's making it faster and more efficient, you can think of it as a pyramid, OK? And at the bottom of that pyramid are all the stuff we take out of the ground, you know?
IAN BREMMER: I mean, the hard commodities-- rare-earth metals, oil, and gas, food, all right? And the market for those things is only getting more global. The demand for that stuff is growing dramatically all over the world, fastest in Asia. But the places where they make that stuff isn't actually changing anywhere near as fast. And to the extent that it is, the biggest change is that the United States is now the leading producer of oil and gas, which has actually made the market more global, not less global.
IAN BREMMER: And it's taken away a lot of the pricing power of OPEC, which is functionally destroyed as an organization right now. One of the reasons why Iran can hit Saudi Arabia last week and take 50% off of their oil production literally in a moment, right? In 20 minutes, it was gone. 5% of global oil production off. As you know, oil price didn't move that much. It would have if the oil market was less global, if it was still primarily about OPEC.
IAN BREMMER: It's not anymore. It's more global. And so despite all of the problems we see geopolitically right now, between the United States and China, I don't believe that that market, the market for stuff out of the ground is becoming any less global. It's really not. In fact, I mean, we can talk about the fact that we might put some tariffs on, and the Chinese aren't going to buy as many lobsters from Maine.
IAN BREMMER: He's buying from Canada instead. And I was with Trudeau last week. And I was kind of angry about that because Trudeau's claiming that the Canadian lobsters are tastier, and they don't actually mate with the Maine lobsters. We know this isn't true. [LAUGHTER] So we actually did have that conversation.
IAN BREMMER: It was kind of funny. But I actually think that, despite all of that, realities of demand and supply for commodities means that we're going to have a more global market over the next 10 years. If you're in that field, there's going to be more growth as a consequence. You want to be a food producer in this environment. You want to be someone that has the ability even transfer fresh water in this environment.
IAN BREMMER: You certainly want to be in things like rare earths. It's important, right? So that's one area of the economy. Globalization is still moving. Don't worry about it. A second area of economy is in basic manufactured goods and services. And that's a place where, my god, the last couple of generations, the last 40 years have just been extraordinary because all of these companies have been able to outsource a lot of services and a hell of a lot of manufacturing to markets where the labor is cheaper.
IAN BREMMER: That's what made China the country it is today. It's also what led to the BRICS, right? Brazil, and Russia, and India, and even South Africa, some people sometimes say. And it's what made Mexico happen. I mean, so it's why, when you have all this populism in places like Mexico and Brazil, and they throw out the bums, and they bring in complete outsiders, like AMLO in Mexico, and Lopez Obrador, and Bolsonaro in Brazil, there's massive anti-corruption.
IAN BREMMER: But these people are not against free trade. They're actually in favor of free trade. Where in the United States, the populists like Sanders and Trump, have a problem with free trade. And it's because, in those countries, those emerging markets, they're like, we grew our middle class and our working class on the back of free trade. We're taking advantage of that. That's good.
IAN BREMMER: So that's been a great, robust thrust of globalization. And what you are now seeing is, number one, wages have gone up a lot in these countries. So if you want to produce in China, you don't get the same delta in profitability that you did 10 years ago, 20 years ago, 30 years ago. Secondly, as I mentioned, no rule of law in China. So as a consequence, as their companies get more competitive, the environment is becoming more challenging for you to operate in.
IAN BREMMER: Third, and perhaps most importantly, is that, increasingly, you just don't need the same amount of labor in the capital equation. Why? Automation, robotics, right? I mean, so as a consequence, there are a lot of companies-- most of the CEOs I talked to in the United States, Fortune 500 CEOs will tell me that over the next 10 years, they think that they can make more money with fewer people.
IAN BREMMER: But because CEOs are overwhelmed with the short-term, with the shareholder returns, with the quarterly outcomes, and because, right now, markets are doing well and their profits are fairly high, and because the average CEO in the US lasts less than five years, they are not inclined to do very much about this right now. So right now, the globalization of that big, meaty piece of manufacturing and services is actually still humming along reasonably robustly.
IAN BREMMER: Now, there's no question that the new tariffs by the United States against China and the reciprocal are slowing that a bit, but not so much that it's really changing the footprint of these companies. So I'd say the globalization has slowed, in some areas maybe even stalled, but it hasn't reversed. And in fact, if you see what Trump has done over the last month, we're getting close to Christmas season, it's like, ah, I don't want to do too much more, and anything that affects consumers.
IAN BREMMER: And my buddy, Xi Jinping, he's about to celebrate the 70th anniversary of the founding of the Communist People's Republic. Of course, I also want to help him celebrate that. So we'll push off some of these tariffs for a month or so. Now, if you're China and you see Trump doing that, you're like, I know he doesn't care about that. What I do know is that, as we get closer to elections, he really doesn't want to hurt his economy.
IAN BREMMER: I know that I can actually wait this guy up. So we are seeing that stall. What's going to happen, though, is that when there is a downturn-- and I don't know when there is a downturn. I mean, there was a CFO survey last week. Over 50% of American CFOs said they expect a recession before the upcoming elections. Bloomberg monitors economists' sentiment.
IAN BREMMER: They think 35% likelihood global recession before the end of 2020. I'm not an economist, so I don't have a strong view on that. But I do have a strong view that when the next downturn happens, suddenly, all of these CEOs are going to have to now look short term and pare their costs. And so suddenly, you're going to see an awful lot of people get rid of footprint in emerging market labor. So the CEO of Walmart has far more people producing in China than he needs.
IAN BREMMER: And you know, he's had labor union problems. He's got cost problems. And if you can automate increasingly, and he's doing that with his distribution centers, why would you possibly want all of your manufacturing being in China? You might want it in China for the Chinese market. But you increasingly-- if you could start Walmart from scratch, there's no way that you'd be doing all that production in China for the rest of the world.
IAN BREMMER: You wouldn't. And so suddenly, we're going to see a rightsizing that, given this fourth-slash-post Industrial Revolution, and that means that it looks stable until there's a downturn. And then suddenly, supply chain is going to shrink. There'll be a bit of a shock. It's not going to-- globalization is not going to go away.
IAN BREMMER: The market's not going to be fragment. It's still going to be global, but it's going to be more localized. That'll be a change. OK. With me so far? Those are the first two. But there's a third part of the pyramid. And that is AI, big data, surveillance, right?
IAN BREMMER: Everything around that. And here's the problem. That third part of the pyramid-- which is the smallest of the three in terms of its value in the global economy right now, but it's there-- is not global at all, at all. It's fragmented in two-- the Chinese and the Americans.
IAN BREMMER: And no one else is close. So if you look at unicorn startups in the last year, 2018, valuation over a billion dollars in high technology, last year, 42% of those globally were US. 40% were China. 18% was the rest of the world. And that gap is getting larger. Europe and Japan are functionally irrelevant in this game in terms of entrepreneurship for the next major drivers of the AI revolution.
IAN BREMMER: And the Chinese and the American systems are increasingly not interoperable. Part of that is because the Chinese government has decided that they want to promote AI as the most important strategic sector. In fact, that by 2030, they want to be the global leader in AI, surpassing that of the United States. Some of that is because the Americans see major national security concerns with allowing the Chinese into our critical infrastructure.
IAN BREMMER: Huawei, 5G, supercomputing, surveillance-- you know, all of anything involving collection of data through chips. What that means is that we actually have two different systems. So on basic trade, we have a lot of interoperability, and we have a lot of reliance upon each other. As the Chinese would call it, win-win. In the AI space, it's increasingly zero-sum, which means we actively want the Chinese to lose.
IAN BREMMER: And that's a problem. So this top bit of the pyramid-- which, right now, is about digital commerce. It's about deep learning from big data. It's about surveillance, facial recognition. It's about the internet. But with 5G and the Internet of Things, over the coming 10 years, that top bit of the pyramid is the fastest growing part of the pyramid globally.
IAN BREMMER: And it's going to start including everything around life sciences and pharma. It's going to include everything around autonomous driving, smart cities, new infrastructure. In other words, the part that looks most problematic is also becoming the most strategic. And it's expanding in size very fast. That is a big, big problem, right? So that's the economic way of looking at this challenge.
IAN BREMMER: But I promised you two different methodologies. So now let me look at the geopolitical way. So Graham Allison reprised something that has been known in my field for a long time as the Thucydides Trap. How many people have heard of the three Thucydides Trap? I'm going to have to explain it. So the Thucydides Trap is when you look at a rising power and a declining power in a system, a regional system or a global system, that, most of the time, historically, that leads to war, right?
IAN BREMMER: Insecurity, not willing to make room, lack of understanding, you name it. In fact, the big study that was written about this over the last few years showed that in the last 15 cases of this globally, in 12 cases, you got war. When I sit down with Henry Kissinger, this is kind of something he always wants to muse about, whether or not war is inevitable between the United States and China.
IAN BREMMER: And even though he's 96, one-on-one, he is still super coherent, believe it or not, though he spills stuff all over himself. And then you're looking, like, do I help him with that because I want to? But I don't want to make him feel bad. And Sarah, my chief of staff, is like, Ian, don't touch him. Don't touch him. So anyway, that was a digression.
IAN BREMMER: But so are we going to end up at war with China? And first of all, I don't believe so. Though if we do-- surprise, surprise, it'll be in the area I just talked about. But let me give you the methodology for understanding this because China is not a global superpower in an integrated way, right? There are lots of ways that countries express power. There's economic power.
IAN BREMMER: There's technological power. There's military power. There's diplomatic and soft power. And it's important to kind of break those down. So if we look at the military space, China is not remotely close to the United States. The US actually spends not only much more than China. The US spends more than the next seven countries combined in defense.
IAN BREMMER: And in fact, even though the Chinese economy is poised to overtake the US in 10 to 15 years by whatever measure you want to choose-- some people think it already has. I don't buy those measures. That's beside the point. The gap between American and Chinese defense spending in the last couple years-- with the US now running a trillion dollar deficit-- that gap has actually grown.
IAN BREMMER: China today is a regional military power. Now, in those areas where China is a military power-- so in Asia, and, most particularly, in Southeast Asia, and around, say, Taiwan and Hong Kong-- we have a problem. It is zero-sum. We are not friendly. We are not allies. We are fighting, right?
IAN BREMMER: So I mean, they have this Nine-Dash Line, which actually brings Chinese influence, like in the South China Sea, right down to the borders of Indonesia and the Philippines. And they recently told Vietnam, if you want to engage in exploitation of resources in an area that is contested-- meaning, obviously, your seas, but we're saying they're ours because we're much more powerful-- you can only use-- you can only exploit it with regional expertise and companies, which makes sense because China has those and Vietnam doesn't.
IAN BREMMER: So just last month, Exxon Mobil, which has a partnership with Vietnam, stopped exploring joint research for resources in what anyone would say is Vietnamese waters because the Chinese pushed them out militarily, and the Americans didn't do anything about it. So in that region, there's a problem. But when you talk about Syria, or Iran, or Venezuela, or Ukraine, China is irrelevant militarily.
IAN BREMMER: On Venezuela, the Russians actually came in and provided military support for Maduro, right? And in fact, Maduro went to Moscow this week just to show how strong he was feeling. He can leave the country. No one can do anything to him, right? But the Chinese don't do that. The Chinese go to Venezuela. They meet with the opposition, that the Americans will recognize, and say, hey, we know we don't know you guys real well.
IAN BREMMER: But just to let you know, in case you happen to get into power, we'll work with you, too. You know, we still want to invest. You owe us 5 billion. You'll still owe us that money. But there's not going to be a military base there from the Chinese. So even though there's a problem between the US and China militarily, we're not heading to war, OK?
IAN BREMMER: In soft power, unlike the Russians in diplomacy, who actually feel really angry with us and, therefore, want to cause trouble-- they interfered in our elections. The Black Lives Matter site that had the most followers in the US during the 2016 election was not the official one, but an unofficial one that was actually fake and run by Russians, that the Kremlin put out because they like the idea of stoking racial disharmony in the United States.
IAN BREMMER: They did the same thing with Brexit. They did the same thing with the French elections and the National Front. They want to divide. The Chinese really have no interest in stoking racial dissent in the United States. I mean, they're actively involved in ensuring that Hong Kong Chinese only get the mainland story.
IAN BREMMER: Absolutely. They're actively involved in trying to ensure that Chinese expats in places like Australia are patriotic. But they're really not doing anything diplomatically to undermine the present global order outside their backyard. So diplomatically, not only are they not very capable-- they're a regional power-- but they also aren't even really a threat to the United States, diplomatically, right?
IAN BREMMER: Now let's get to the more problematic areas. Economically, they are a superpower. They're still smaller than the United States. But because the Chinese economy is driven by the government, they actually punch above their weight. So when the Americans tell other countries, don't join Belt and Road, even our allies join, because the Italians say, we've got to fix up this port in Torino.
IAN BREMMER: And you guys aren't going to do it, but the Chinese are. The Chinese are writing the checks. I was with the Greek prime minister yesterday morning. And he was talking to me about just how much they need American investment because, otherwise, it's all China. And when it's China, it's not the private sector. It's coming in with the state. We'll build the port.
IAN BREMMER: We'll build the infrastructure. We'll create jobs. It used to be China was only about exporting people and jobs. But now that their own demographics are shifting, it's much more about the capital and the infrastructure, right? So China is a superpower, economically. There is a competition. But the Chinese want a robust American economy.
IAN BREMMER: So when they engage in cyber attacks against the US, they absolutely try to steal things so that they can profit. They steal IP all the time, right? But they're not trying to break the US marketplace. They're not trying to destroy US banks because they want to trade with us. China's perspective is, look, we're getting bigger. And if we stay quiet about this stuff, over time, we get to run everything.
IAN BREMMER: But we want to run a robust economy. It is-- I mean, they're not about taking more land. They're about exploiting more markets. So here they are a superpower, and there are conflicts. But it's still win-win. They want to trade more with us, not less. They don't want a tariff war. And by the way, the tariff war, so far, that we've had between the two countries has taken about half a point of GDP off of Chinese growth.
IAN BREMMER: It's taken about a tenth a point of GDP off the United States. We're bigger. But also, we're just not as reliant, right? I mean, we have a big internal market. The Chinese need to actually export a lot more. This is more problematic for them. So nobody wins a trade war, but some people lose bigger, right? And it's important to recognize that. Now let's take that and look at your area.
IAN BREMMER: What's happening in technology and data? What's happening with content? And here is the area where the Chinese are a superpower and it's not cooperative, right? And let's first talk about how they are a superpower because, economically, everyone out there knew they were becoming a superpower. Everyone out there, for 20 years now, has been saying, we can see them becoming the largest economy in the world.
IAN BREMMER: 1.4 billion, right? But technologically, if you talk to Americans that are in Washington in the policy establishment, they'll say, well, they steal stuff, but they don't innovate. They're not entrepreneurial. And even five years ago, you could have made that argument. You can't today. Today the Chinese are actually a legitimate technology superpower.
IAN BREMMER: In fact, they're one of two. We're the other one-- no one else, as I mentioned before. In some areas, the Chinese are actually leading the United States, specifically in facial recognition and voice recognition. They have 800 million people with smartphones. Their data is integrated vertically with only a couple of apps that are much more capable than our apps are because everyone's on them, and they do lots of stuff.
IAN BREMMER: So that data's all being used to complete the same studies about human behavior, right? So last year, if you look at data, digital commerce in China was 50 times greater than the United States-- five-zero, five-zero. Ride sharing was 1,000 times greater in terms of total amount, data online. Any of you-- how many people go to China? OK.
IAN BREMMER: So you know they don't use credit cards, right? They don't use wallets. It's all smartphone. You want to go into a building? Increasingly, no ID. Just use your face. You're a Uyghur? You want to get thrown in jail. You don't need ID for that.
IAN BREMMER: They'll just pick you up off the street. It's not a problem, right? So I mean, that is a very different system. And the Chinese competition with the United States here is real. Now, do I believe that they will win? I don't know. I don't know. I mean, I will tell you that our entrepreneurs are a hell of a lot better than theirs.
IAN BREMMER: Theirs work harder. But ours are much more outside the box. The Chinese are better at figuring out how to commercialize existing AI applications. I suspect they will make more money out of AI in the next five years than we will. But they're not doing a lot of, what's the next moonshot research? So I was with Mustafa Suleyman, very good friend of mine, on Tuesday night?
IAN BREMMER: Tuesday night. Came by my house. He runs DeepMind. His is the firm that created the AlphaGo that not only beat the world's best Go master, but came up with a move no one-- an entire strategy that no one had remotely considered was plausible simply by studying brute force, what was happening, learning itself. And he told me, look, let's be very clear.
IAN BREMMER: What we are trying to do at DeepMind-- and by the way, everyone in the US is trying to do-- is, by 2045, replace all human beings with automated AI capacity. We're trying to create artificial general intelligence in the next generation or so. That's what their goal is. There are a lot of people working on that in US AI. Google is the leader.
IAN BREMMER: Microsoft and Amazon are close. There's almost no one working on that in China because they don't yet see the short-term applications for that that are going to make money. Now, there's no question that the Chinese are paying for a hell of a lot more people to do AI research in China. They're educating a lot more of them now. And they're also providing enormous amounts of cash to people graduating from universities in the US with a relevant STEM education.
IAN BREMMER: They're not only paying them more. They're paying their spouses. They're setting up research laboratories. They're giving them money for those research projects. And the Americans are, in course, increasingly telling those Chinese and others, you're not very wanted. Now, there've been changes. Trump was in Texas with Modi a few days ago. Modi likes Trump more than he liked Obama.
IAN BREMMER: The Indians are definitely feeling the love, and I don't see the Indians sort of reducing their numbers in a large way in terms of coming into the US to try to make the visa regime easier for them. But broadly speaking, American institutions of higher learning are feeling less welcoming for a lot of top scientists from emerging markets, especially those that aren't white, than they were two years ago, three years ago.
IAN BREMMER: And those numbers are changing, while the Chinese are doing everything possible to grab those people. So I mean, that's a problem, but it's a problem at the margins. The fundamental question is, what is AI going to look like as a marketplace? Is it the Manhattan Project? Or is it climate change? So Kai-Fu Lee-- who I know pretty well, and he's kind of the lead AI specialist in China-- he wrote this book called AI Superpowers.
IAN BREMMER: He believes that AI is dumb. It's basically all about getting more, and more, and more data, and just doing pattern recognition, learning from that data in ways that human beings could never do, but computers are very well suited. And he thinks that's what's going to happen for the next 20 years. And if he's right, the Chinese will probably win because they will simply have vastly more resource they can throw at it.
IAN BREMMER: And the government will be aligned making that the most important strategic sector. He could easily be wrong. Most people I know in the US, like Reid Hoffman, and Eric Schmidt, and Mustafa, who I just mentioned-- the aforementioned-- they believe that, actually, AI breakthroughs are like climate change. 30 years ago, we knew climate change was coming.
IAN BREMMER: But we didn't know if we were going to make big breakthroughs in cold fusion or if it would be stupid. We didn't. And it turns out, so far, it's been stupid, right? But even Al Gore didn't think, 10 years ago, that solar would be cheaper than coal by 2020. And it is, right? That's extraordinary.
IAN BREMMER: But you need to be taking an awful lot of bets on weird technologies that aren't yet developed in order to find out what you're going to do to respond to climate change. Now, the Chinese are now the largest solar panel producers in the world. But the basic research in all the big new breakthroughs on things like carbon sequestration, taking it out of the atmosphere, geoengineering, shooting sulfur particles into the stratosphere that would actually reduce the temperature of the planet, that's all being done overwhelmingly in the United States.
IAN BREMMER: If it turns out that AI is more like that, then it's likely the Americans are going to win. We don't know. And I mean, honestly, I'm not trying to lean you towards, oh, it's OK. It's going to be the US. We don't know. But we do have one other problem. And that problem is that there's a coincidence of two things that are happening at the same time.
IAN BREMMER: On the one hand, the Chinese have just become a tech superpower, and they have decided that this is the most important thing their government needs to invest in to ensure that they will never be left behind again. So in the last year, the major lesson they took from the fight with the United States is, we will never be so vulnerable for our supply chain on semiconductors. We will build them in China.
IAN BREMMER: And those we can't build, we will make sure we have control over the countries that actually build them, or there will be hell to pay. Which means Taiwan-- of course, China will be able to lock that up-- and South Korea, where they're making huge headway. If you want to know why it is Xi Jinping was actually the one hosting the Japanese and South Korean foreign ministers in order to try to get them together, that's why.
IAN BREMMER: That was just a month ago. So that's what China is doing. That's one thing that's happening. But the second thing that's happening is, inside the United States, we're getting really angry at these tech companies. We've got people saying, they're destroying democracy. And I don't think they're intentionally destroying democracy.
IAN BREMMER: I think it's a byproduct that's purely unintentional of their business model. But it's a problem, right? I mean, fake news, and the filter bubble, and the polarization that comes from only reading things that you agree with and like because that's the way you maximize advertising revenue from the products, who are American citizens, right? That's a problem.
IAN BREMMER: But it means that, in the United States, an awful lot of people are not focusing on China building what may be the world leaders in AI, instead are focusing on, we have to regulate and even maybe break up our tech companies. Because in the '70s and '80s, you didn't have people in the US saying, we need to break up Lockheed Martin, or Lockheed-- before it was Lockheed Martin-- or Raytheon, or Northrop.
IAN BREMMER: We said, oh, these are the most important companies. And they're so important that we can't even let them go bankrupt. The first time the term "too big to fail" was ever used was not about a bank. It was describing Lockheed in the '70s. Because if we let them go bankrupt, we'd be too vulnerable to the Soviets. You don't hear anyone saying that about Facebook, Mark Zuckerberg.
IAN BREMMER: No one is saying that. And yet it might even be more true. It might even be more true. I mean, actually, Mark does say it. But nobody wants to listen to Mark right now. He has other problems. OK. Before I go to questions-- and again, this is what you asked me to talk about, so I'm really focusing on this.
IAN BREMMER: And I'll go anywhere in the world you want to. I'm going to do geopolitical stuff. Some of you guys know me. But let me talk at least a tiny bit about the rest of the world. I have not mentioned Europe one bit because they are not relevant to who's going to win. But Europe is a superpower. They are not an entrepreneurial superpower.
IAN BREMMER: They are a regulatory superpower. Europe has the largest common market. And their regulators are capable. Their tech regulators are vastly better than American tech regulators. And for an obvious reason. The United States, it's all about animal spirits. The United States, it's all about special interests, lot of money.
IAN BREMMER: So in the US, the regulators get captured by special interests who have cash. On the right, big oil, big finance, Big Pharma. On the left, teachers, unions, trial lawyers. I mean, you name it, right? And it really hurts the viability and efficiency of the system long-term for the American citizens. But that's the way it works. What that means is, if you are talented, you don't want to be a regulator, right?
IAN BREMMER: I mean, if you've got a kid, an all-star kid, you don't send your kids the Department of Commerce. Maybe a middle child you don't care about, but not the star. You want that kid in McKinsey or Google, something good-- Goldman even still maybe, right? Yeah. Yeah. Want them publishing, absolutely. So the Eurasia Group, let's do it.
IAN BREMMER: In Europe, if you have a talented kid, working in Brussels on tech regulation is a big deal. It's a big job. You matter. It's patriotic. It's impactful. They're the largest common market in the world. Margrethe Vestager, who is in charge of this stuff right now, is seen as one of the most powerful Europeans, one of the power people globally, one of the powerful women in the world, you know?
IAN BREMMER: I mean, Christine Lagarde, ECB, same thing. European institutions really matter. We talk about how there's all these problems inside European countries. The Italian government that just fell apart. The UK Brexit disaster. But at the European level, the EU level, actually, they're stronger now than they've ever been before. I mean, von der Leyen, and Gentiloni, and Investasure, and all of these-- I mean, these are very serious, strong, pro-European-- we're going to use our weight to actually regulate.
IAN BREMMER: And that's why-- I mean, I heard in the opening, people talk GDPR, Right I mean, privacy, copyright. The Europeans are driving an awful lot of regulations that, in America-- in California, for example, they're picking them up. Now, unfortunately, the Europeans aren't working very well with the Americans. In part, because Trump is a unilateralist. In part, because the Europeans historically like to do this stuff themselves more.
IAN BREMMER: And they see it as their power, especially because you see a lot of inequality growing in Europe. And since the big companies are American, it's very easy for Macron to say, let's put a tax on Facebook, because that's not going to hurt him. That's just a tax, right? But in part, it's also Snowden and the knock-on effect from the American National Security Agency that was spying on Merkel, unbeknownst to Merkel, and her private cell phone.
IAN BREMMER: And so there's not a lot of trust between these countries. So right now, the Europeans are trying to see if they can go a third way. They can't. There is no third way. They will not build these companies. They won't. So what we need-- it's not going to happen.
IAN BREMMER: But what we need, what your industry should be pushing for, is a WTO for data. What we need is something that is actually aligned on these things with all the countries that actually have rule of law that the Chinese would then need to join. Because if they don't join and align with it over time, they can have their own system, but they'll be left out of all the key markets.
IAN BREMMER: You don't want the Chinese to divide and conquer. You don't want them picking off individual, poorer European countries that need their cash. But I mean, if you asked right now, is Trump prepared to promote multi-- I mean, I was with Jared yesterday morning. And Jared's perspective is, hey, we're just about to finish a US-Japan trade deal, which is as good as TPP.
IAN BREMMER: That is the Trump perspective, right? And I told him, I'm like, I get it. It's high standard. It's really good you guys are doing that. But it's very different to have a bunch of bilateral deals than having one multilateral regime that everyone has because all those bilateral deals are different. And you get picked off by the Chinese.
IAN BREMMER: And you cannot make that argument with Trump. You just can't. And I'm not sure you can make that argument with whatever democratic contender you're going to have. Keep in mind, TPP, it was a huge strategic mistake for the US to pull out of TPP. Everyone blames Trump. But it wasn't like Obama got it done. It was the single most important foreign policy initiative he had, the pivot to Asia.
IAN BREMMER: He failed. He failed. And he failed knowing the politics were going to be harder for the next president. Knowing Trump had a shot. Knowing Bernie Sanders had a shot. And he said, I'm going to kill it. Knowing that Hillary Clinton, who was a freaking architect of the thing, said, well, I couldn't possibly pass it the way it is.
IAN BREMMER: I'd have to change it because America's changed on trade. So you know, look, I am no Trump, MAGA-wearing, whatever the hell it is. I'm just a political scientist. But I'm not going to lie to you people about it. I mean, the challenges are much deeper than that. Well, I've just done 40 minutes. They've given me an hour, which means that there is 20 minutes remaining.
IAN BREMMER: I'm not I'm not a mathematician, but I got the basics. So do we have microphones that are floating? Or do I have to-- you just have to shout? You do have microphones. OK. So if you raise your hand-- and there's one in the back that's going to start here. And I expect with this audience, I'm going to get lots of hands. There's one here.
IAN BREMMER: The one with the microphone already told me that she's going to ask question, so that's a third one. My buddy Niko-- and I'm here for him because we ran the-- he runs the Oxford Press. Everyone love Niko? Does everyone know Niko? [APPLAUSE] OK.
IAN BREMMER: Good. Because we've been besties for like 15 years, something like that. We ran the New York Marathon together which, we're never going to do again. And he told me you guys are awesome, and could I please come down and do this to kick this off? And I'm like, yeah, Niko. Of course I'll do it for you.
IAN BREMMER: So that's-- if you didn't like it, it's his fault. But otherwise, I expect that Niko should have just more love as a consequence of this. That's kind of the big take-away. Yes. Go ahead.
AUDIENCE: I'm Tyler from a software company. [INAUDIBLE] position. Know a lot of people getting a machine learning field. And I just want to push back a little bit on the idea that there's another AI innovation coming, like deep learning, which is essentially a 40-year-old technology. That was operationalized because of hardware. And DeepMind just lost like $500 million. So the idea that the choice that you had between success of China and the success of the US, if it hinges on a technology similar to deep learning coming out rather than just applications, then it's already over because we're looking at another 30 to 50 years before a similar idea emerges if you look at sort of historical patterns.
AUDIENCE: So--
IAN BREMMER: Look. So number one, that's a great point. And I was talking to Nick Bostrom last week, who wrote Supercomputing--
AUDIENCE: [INAUDIBLE]
IAN BREMMER: [INAUDIBLE]. Shoot. Name of it was-- so name of the book was again, so everyone knows?
AUDIENCE: [INAUDIBLE]
IAN BREMMER: Name of the book.
AUDIENCE: Superintelligence.
IAN BREMMER: Superintelligence. Which, I mean, by many in the AI field, is considered to be like the most seminal book that's been written in the last 10 years. He wrote it, if I remember correctly, in 2014. And so what I-- and one of the things he did in that book, which I'm sure you've read-- I mean, I'm-- you haven't read that book? OK.
IAN BREMMER: Will you please read that book? OK. Because that's kind of like the-- at the time, one of the things he did was he looked at-- he basically talked to all of the major people working on AI around the world, all the major scientists, all the major technologists in the field. And he was asking them the same basic questions. And one of them was about, do you believe artificial general intelligence is possible?
IAN BREMMER: And if it is, when it's going to come about. At the time, 80% thought it was possible. And they thought it would come out around 2045, 2050. So when I saw him, the first question I asked him is, it's been five years since you wrote the book. Has that changed? He says, yes. First of all, people are much more convinced it will happen, and they believe it will happen by 2040.
IAN BREMMER: I was very surprised by that. Now, the caveat that you made at the end of your question is, nothing is going to happen in the next 20 years if historical trends apply. My counterargument would be, a lot of technology developments, historically, have been asymptotic. So you know, are we going to have the same-- is it going to take another 40 years? And the answer is, probably not.
IAN BREMMER: Now, look. If we have mass-- if we have a major climate cataclysm that creates a depression, then you're going to kick a lot of this stuff out, right? And that's a real problem. And I do think that there are going to be big headwinds in the global economy over the coming 20, 30 years.
IAN BREMMER: But I will say that I've personally been surprised at just how many things, and how many jobs, and how many sectors that we thought would not be as disrupted by present types of AI have been more quickly than people presumed. And I wonder if that means that the next major breakthrough-- I'm not the scientist. I mean, if you asked me this question about a geopolitical question, I'd have a lot of primary research I could back it up with.
IAN BREMMER: Here, I'm basically telling you, here's the state of the field. Here's where these people are. And you know, you can sort of take a whack at DeepMind. But actually, Brad Smith, the guy that just wrote Tools and Weapons-- also a great book. Sadly, not an Oxford University Press book. But you don't have to buy the book. You can just read the reviews that are out there. That's OK.
IAN BREMMER: I mean, he's the number two at Microsoft. His view is largely the same on this. So I mean, I do think it is, broadly speaking, a Silicon Valley view. I'm a little worried that the Silicon Valley guys are drinking a lot of their own Kool-Aid. I think that is a problem. And if the world is moving the way I think it is, that means that over the next 10 to 20 years, these largely libertarian companies are going to become much more strategic and aligned with the US government.
IAN BREMMER: I think Jeff Bezos gets this more than the other guys do. I mean, he bought the Washington Post. He spent $28 million on his house in Washington, DC. I don't think that's vanity project. I think he's actually now looking to, how can I build out massive US technology contracts? And if you believe that we're actually heading to the IoT, where it's not about your smartphone, but it's actually about an ecosystem of all the data around you which means where you live, then I think what Bezos wants to do is he wants to be the tech provider for all Americans that are in low-cost government housing.
IAN BREMMER: Amazon families, Amazon products, Amazon infrastructure. And if you think that that inequality is going to grow, and that a lot of people aren't going to have jobs, and we're going to need universal basic income, this might be the smartest single business model in the world right now in the United States. It is dystopian as shit, OK? But that's why Jeff is building rocket ships, too.
IAN BREMMER: He doesn't want to deal with it. He just wants to profit from it. So I do kind of worry about that, OK? Did I just blow your minds a tiny bit? A little bit? Come on. Oh, good. I'm glad. OK.
IAN BREMMER: Who was next? Was it over here? Right here. Byron. We'll get a microphone coming to you.
AUDIENCE: Byron Mosman, Nova Techset. I wonder if you could talk a little bit more about India and their economic development, how that plays out, from your view, over the next 20 years or so.
IAN BREMMER: So it's interesting. I was with the Colombian president last night. And I was asking-- we had about an hour. And at the end of the conversation, I asked him, so tell me, you talk-- we're talking mostly about Venezuela, and the US, and stuff like that. I said, tell me, any surprise meetings that you had, any things that you didn't expect that now matter to you.
IAN BREMMER: He said, yes. Said, Modi. He said, I am amazed by his universal ID system. I need it in Colombia now. Really interesting, right? I mean, I think that, for countries that are lower income, that are working on strapped budgets, that need to get rid of corruption, and find a way to get those budgets directly to people and bypass bureaucracy, Modi has done a better job in figuring that out than anyone because he's the guy with the 1.4 billion person population with massive decentralization of power.
IAN BREMMER: Breathtaking, staggering corruption inside the party, inside the labor unions, inside the provinces, inside the cities. You can't build a goddamn thing in infrastructure unless you pay all of them off. He's like, I've got to find a tech way-- which, by the way, is a top-down authoritarian way-- to ensure that I can bypass all this stuff. So I think Modi gets that.
IAN BREMMER: But let us not forget just how far behind India is. This year, the Indian government will spend, despite-- after four years of Modi working as hard as he can to build up growth and focus on infrastructure, India will spend 10% on its infrastructure of what the Chinese are spending on theirs. 10%. Both countries, 1.4 billion people.
IAN BREMMER: Every day, India is getting further behind. They're not getting closer. This is winner-take-all stuff. So I like India. I'm going there again in a couple of months. We've got clients there. It's a pain in the ass. The air is vastly less breathable than China. Again, I'm sure you know that.
IAN BREMMER: Their ability to deal with it is virtually zero. They desperately need people to get on to the grid, which means mostly coal-fired plants, where in China, they're moving away from that. This is all-- I mean India has massive hurdles. They're growing this year about 5%. When Modi was running Gujarat, Gujarat was running a 10. Lot harder to run India. So they're moving in the right direction.
IAN BREMMER: They just brought corporate taxation down, which, in the last few days, they finally have a national goods and services tax. They needed that 20 years ago. I mean, they have a leader that is moving that country in the right direction. There are other emerging markets around the world that are also engaged in real economic reform. Duque in Colombia is one.
IAN BREMMER: Bolsonaro, horrible for the climate, but economic reform? My god, he's doing what needs to be done in that country. You can find these people, but it is really late. And the global economy is about to head into a cyclical downturn. I don't know how big it's going to be. But you know, again, this is the longest period we've gone without a recession in modern history in the United States.
IAN BREMMER: Nobody thinks we're growing more than 2% next year. And that means you're going to lay people off. And the US is the driver of the global economy, still much more than China. It's going to be a problem. So I mean, I think India needs a lot of things to go right for me to get more excited about them than I am right now. But you know, if you're asking me, do I think India is a robust place to be selling books going forward and-- selling content, excuse me.
IAN BREMMER: So yeah, of course I do. In fact, for my own media company, I'm probably more-- India's in my top five places that I want to get distribution licensing on it because it's just an extraordinary, large, literate urban population that speaks English and cares about this stuff. So you know, that's kind of exciting. There was-- who else? Was this next one?
IAN BREMMER: Is that right? OK.
AUDIENCE: Great talk. [INAUDIBLE] I'm curious about Africa. If you see the UN population forecast to the end of century, the outcome there is a population bigger than the US. Nigeria is [INAUDIBLE] size of China. When does Africa actually arrive [INAUDIBLE]??
IAN BREMMER: Well, number one, Africa today is, we're talking, 2% of the global economy. So I mean, they've got a lot of people. But all of the problems that are in the world, Africa has a vastly greater share of them. We're going to hit 3 degrees, 3.5 degrees warming minimum over the period of time where their population is going to expand massively. The variance on what their population might be by 2100 is, by far, the largest unknown factor in those UN reports.
IAN BREMMER: That population will grow a lot faster if they don't urbanize, globalize, and get wealthier. Keep in mind that the extreme weather conditions, what happens when you get 3.5 degrees warming, in Equatorial Africa is vastly greater than anything else in the world. It's massive. It's a real problem. And you're already seeing, because of the internal, the intrinsic opposition to GMOs, you're seeing that maize production in places like Kenya is down about 27%.
IAN BREMMER: It should be up. That's a cassava. I mean, I was a-- Gates Foundation is a client of ours. I work with them closely. This is the thing they're worried about mostly right now, is that they're just not able to build them. And you've actually had an increase in poverty levels in most of sub-Saharan Africa that is outstripping the population growth.
IAN BREMMER: Only place in the world that's happening. It wasn't happening five years ago. Now it is. There's some countries, like Rwanda, that are governed better. And so poverty is going up, but slower than the population increase rate. Absolute poverty in Equatorial Africa, almost across the board, actually outstripping population growth.
IAN BREMMER: So, look, I'm going to Ethiopia in two weeks. No, four weeks-- in a month. And you know, I'm very excited about looking in a lot of [INAUDIBLE] in a lot of these cities for human capital stories that I think are going to be massive because they're the ones that are going to figure out the responses to what they need on the ground, because no one else is. The Americans, the big companies just aren't paying much attention right now.
IAN BREMMER: And when we see a contraction, they're going to go-- first of all, it's a great place to, I think, spend that time. But those are tiny plays. The big plays? Are we going to talk about the Africa miracle, the Africa story? Oh no. Absolutely not.
IAN BREMMER: Greta's a little too late for that, right? For those of you that saw her this week. Any more? Because you don't want me to just ramble. We can go anywhere. Yeah. Right over here.
AUDIENCE: Thanks very much for your talk. Lauren Kay with Delta Bank. I'm wondering if you could comment about censorship. Some of the publishers in the room have had an issue with China with having to remove access to certain articles, certain publications in order to more broadly maintain access to their aggregations.
IAN BREMMER: Yeah. There'll be more of that. [LAUGHTER] No. And the Chinese are exporting it. The DRC, Zimbabwe, Pakistan, Lao, Cambodia-- there are a number-- I mean, early Belt and Road investments were focused on building ports, building railways, building highways.
IAN BREMMER: And those are things that, even if we would rather if the Americans built them, we generally want them to be built because, if you build a port, anyone can use it. If you build a port, everyone does better as a consequence. They are now starting to export data regimes. They're exporting 5G. And I mean, unless the Americans destroy Huawei-- and I don't think we'll destroy it.
IAN BREMMER: I think we may make it a very different company. That means that the Chinese are going to start exporting surveillance mechanisms and data to these other countries. So you'll need to start paying more attention to where censorship-- I mean, you'll need to understand what kinds of censorship are particularly vital to countries that have data regimes that get locked up by the Chinese.
IAN BREMMER: And you will need governance to deal with those things over the next five years. That'll be important to you. Now, keep in mind, the Americans are also exporting these technologies. Palantir was exporting the same sort of technology to the Saudis. The Saudis engage in very significant censorship. They've gotten an awful lot better at it on social media and the rest, especially around issues like homosexuality, for example, because of American exported technology.
IAN BREMMER: The Israelis are doing the same thing. But we're just doing it for profit. The Chinese are actually doing it not for pleasure, but for longer-term strategic alignment, as well. And that is more important. And Palantir can go under. And then they have the technology, but whatever. Where if the Chinese are doing it, it actually does tend to have longer legs as a consequence.
IAN BREMMER: Yeah. Back there. Over here. First in the back. Yep. And then there.
AUDIENCE: You gave a great speech. Andrew Harmon from the Endocrine Society. And I just wanted to point out that some of us here are from nonprofits. We're from organizations that represent researchers, many of whom get their funding and their salaries from government, from government grants. This downturn in the global economy that you're seeing, foreseeing, what do you see being any long-term effect on the nonprofit sector?
AUDIENCE: And what can we do about it either ahead of time or in response?
IAN BREMMER: Well, I mean government funding for nonprofits in the United States is clearly going to be under a lot more challenge. It will be globally given that downturn. But I think the importance of nonprofits, the recognition from the private sector that you need to partner with these guys in order to get things done because you're not seeing governance work properly, is going to grow. So I mean, there's no question in my mind.
IAN BREMMER: I mean, if you look at where you're going to see the experimentation come on universal basic income, or on the gig economy, or on changing the social contract, nonprofits are going to be leading the way, and also hybrid organizations that aren't necessarily nonprofits but are, themselves, quite entrepreneurial in their do-goodedness. So generally speaking-- look, I started a foundation that Niko's on the board of, the Eurasia Group Foundation.
IAN BREMMER: I would not have done that 10 years ago. I'm doing it now because I feel like there's much more space for an organization like ours to contribute to better understanding what some of these challenges are going to be globally. And I think that they're just an awful lot, especially if you're living in a node. If you're living in a super city, where you have the-- well, you can use your people, and network them effectively, and get that message out, it makes a big difference.
IAN BREMMER: But I do think the nonprofits are going to become unequal, too. I mean, first-tier cities globally is where you're going to have 99% of the nonprofit activity. And most of that money will be devoted locally because people care about their tribe. They care about their community. So the thing that worries me most is that the flyover country, which includes an awful lot of cities that aren't first tier, they're not going to have talent.
IAN BREMMER: People aren't going to be paying as much attention. Because so much of this money is going to come from the corporates, and the corporates are going to want to say, where are we? We do care more about just than our shareholders. We care about our client base, our consumers, people that could call it cause trouble for us in social media. They're all in the same place. So the thing we most worry about is-- and this is, again, why I think the Bezos model is so inspired, but nefarious.
IAN BREMMER: Over here. Yeah. Oh, yeah. And then you.
AUDIENCE: Hi. Burt Corelli--
IAN BREMMER: This is your last one.
AUDIENCE: [? --MD. ?]
IAN BREMMER: Yeah. Hey.
AUDIENCE: So a lot of people in this room represent organizations that are faced with the big challenge of what we call open science or open access. The expectation of the market, that a lot of the things that have been published and have been sold traditionally through subscription models are disappearing and going to open and free access. So maybe from the perspective of Time Magazine and other forms of media that faced that 10 years ago, 20 years ago, what advice can you give to people here?
IAN BREMMER: [SIGHS] I mean, look. A lot of people are getting displaced. A lot of models are getting displaced. I mean, this superstar, winner-take-all economy where, if you're in the top of your field in content, whether it's in music, or it's sort of as an expert, or it's a talking head, or whatever it is, and then maybe 2% of the people can make a living, and everybody else is functionally operating for free, I think that's a huge problem.
IAN BREMMER: My response to that-- so when you talk to me about universal basic income and how it's not going to work, it would certainly work with creatives. There are an awful lot of people out there that are working their tails off at jobs they find completely uninspiring to allow them to make a basic nut so that they can do the things that they think would make a positive contribution to humanity, and certainly give them a sense of purpose and value.
IAN BREMMER: Everyone that hates UBI says, well, because the people won't have purpose and value. Well, no. Working in a job that is completely dehumanizing, and destroys your health, and destroys your family is clearly worse for you spiritually, right? We all know if you can spend more time with your family and you don't have to worry about doing something dehumanizing, you're actually happier as a human being.
IAN BREMMER: So I would love to see more of these early-scale UBI projects oriented towards populations where we kind of know the hurdle rate isn't as great. And I mean, you know, we'll see. I think that-- I think it's going to happen. I do think those things will happen because, since it's not going to be top-down, you're going to have people that are connected that say, we want to make a difference here.
IAN BREMMER: I don't think it's about Mark Zuckerberg saying, we're going to invest in a few local newspapers. No, because those models are going away, right? I mean, that's clearly happening. I mean, you know, it's 5% of all advertising is in newspapers right now in the US. 3% is radio. It's not, how do we save newspapers? It's more, how do we save the people that are producing the content that's critical to-- creating a civil society is something that we're proud of, without going into the Chinese model.
IAN BREMMER: And that is an open question. Because if the data universe is fragmenting not just between the US and China, but also between classes inside the world as we move to ecosystems of data, then those people are not going to-- they're not going to talk to each other. They're not going intermarry. They're not going to interrelate.
IAN BREMMER: We're in a very different type of civil society than we have right now. So we have time for one last question. Before I do, I'll just tell you guys, we actually have-- if people want to stay in touch afterwards, we have this newsletter we put out called Signal, which is completely free for folks. If you have business cards and you want, I'll make sure that-- Sarah will make sure that we sign you guys up.
IAN BREMMER: As I'm done, just grab a card, and throw it at me, and we'll have an excuse. Niko's a subscriber. He likes it. Please, go ahead.
AUDIENCE: Hi. Thank you very much. Allison Belan with Duke University Press. So with the trade, Trump has a specific interest in that. And he actually-- it's something he has a, well-- well, a formed philosophy on. And he's impacted it. Has he or his administration had any impact on the technology and innovation arc that you're describing?
IAN BREMMER: They haven't in the United States, not domestically. They really don't have any people that are oriented towards that yet. There was this Technology Council that Chris Liddell, who used to be the CFO of Microsoft, is now running in the White House. It's badly understaffed and also kind of fell apart after the Charlottesville stuff, when some of these council-- the CEOs no longer wanted to be seen as traipsing to the White House and supporting Trump on a regular basis.
IAN BREMMER: So now it's more one-on-one. But he's definitely having an impact globally. So number one, I mean, when you actually see all of these companies in China that are put on a watch list where they're not allowed to do business in certain areas, that's not just about the US. It's about other companies in other parts of the world that want to bank with the US.
IAN BREMMER: We've got the reserve currency. We've got the banks that are big. So I mean, like when we pulled out of the Iran deal, a lot of countries complained, but they all stopped buying Iranian crude. It wasn't just the United States, those sanctions. That is what's happening on tech right now. And I haven't spoken to the Chinese leadership in the last couple of weeks, but I have spoken to the Chinese ambassador to Washington.
IAN BREMMER: And he said that one of the red lines with getting to a deal is that it's OK if Huawei can't get their supply chain in the US. But the United States has to allow Huawei to operate in other countries. And that is not going to happen. Even though Trump says, I can get you a deal on Huawei, to Xi Jinping directly, when Lighthizer and others, Peter Navarro, are then talking to the working sessions with the Chinese, they're saying, yeah, but he didn't mean that, right?
IAN BREMMER: He meant they can do headsets, handsets. That's a real problem. So I do think that the US government is moving in a direction that is trying to ensure that if the Chinese are going to build their own platforms and data, that American allies will absolutely not be a part of that. And that's going to be a fight. The Kazakh president, yesterday, had just met with Xi Jinping.
IAN BREMMER: And Xi Jinping pushed him really hard. He said, I need you to do 5G and Huawei. And I said, what did you say? And he said, I didn't say anything. So I mean, this is a hard problem for a lot of these folks. So again, thank you all very much. I hope you found it worthwhile. And I hope you enjoy your meeting.
IAN BREMMER: Cheers. [APPLAUSE]
Segment:0 .
IAN BREMMER: Good morning, everybody. It's kind of a fun way for me to kick off a day. This week has been absolutely impossible. And this is almost like a breath in the middle of it. And not just impossible in terms of the United Nations, but just impossible in terms of what the news cycle right now looks like. I mean, you know, [AUDIO OUT] I like talking about the issues we're going to discuss this morning. But we do have some Q&A. And I'm not opposed if someone asks me what the hell I think about this impeachment situation.
IAN BREMMER: I actually tweeted out this morning that if there's one thing we can all agree on, it's that it sucks to be Ukraine. I think we can all-- [LAUGHTER] --whether you're a Democrat or a Republican, it's just bad to be Ukraine, right? I mean, they've been-- I mean, it's not new.
IAN BREMMER: It's historic that they get taken advantage of by everybody. But I was actually at the-- at the UN yesterday, someone told me they're basically Palestine in Eastern Europe. That's kind of what-- I know. there's a lot of dark humor at the United [AUDIO OUT].. But that's not what we're talking about.
IAN BREMMER: We are talking about something related, which is an unwind that is happening in a piece of globalization that's actually pretty relevant to what you all do. And that is this coming war in technology. And before I get into that, I want to give you two different frameworks to think about that.
IAN BREMMER: The first is an economic framework. And the second is a geopolitical framework. And once I [AUDIO OUT] all that kind of thing. So what do I mean? [AUDIO OUT] --right? I mean, the thing that has excited us, the thing that's been the good news story is that ideas, and capital, and people moving faster and faster around the world, becoming more efficient, has driven extraordinary economic gains, unlocked the kind of growth that none of us have ever seen in the history of humanity.
Segment:1 Segment 2.
IAN BREMMER: I mean, the last century, we've put 20 years on people's life expectancy. We've brought a billion people out of absolute poverty over the last generation. And if you go and talk to Bill Gates and say, what are you excited about, that's the story he's excited about. Hans Rosling, who many of you have read, Factfulness, the wonder [AUDIO OUT] --some warrants or not, the fact was, we all were sort of aligned to US-led global institutions-- the IMF, the World Bank, right?
IAN BREMMER: I mean, Bretton Woods Accord on Currency-- they sound like global institutions, right? In the same way the World Bank-- the World Series sounds like a global [AUDIO OUT] --from the World Bank, it's not global. It's about US-led [AUDIO OUT]. The problem is that, very soon, the world's largest economy is not going to be a free market.
IAN BREMMER: It's not going to be a democracy. It's going to be a state capitalist authoritarian regime. And there are a lot of people that are just wrong, have been wrong about China's development. I mean, generally speaking, in the West, the view was that as China gets wealthier, they will either align with our values and open up politically or economically, or they'll fail.
IAN BREMMER: That was wrong. And because that was wrong, I'm here talking to you about this issue right now. So what's the economic framework? The economic framework is that, if you look at globalization, that trend I just discussed that's making it faster and more efficient, you can think of it as a pyramid, OK? And at the bottom of that pyramid are all the stuff we take out of the ground, you know?
IAN BREMMER: I mean, the hard commodities-- rare-earth metals, oil, and gas, food, all right? And the market for those things is only getting more global. The demand for that stuff is growing dramatically all over the world, fastest in Asia. But the places where they make that stuff isn't actually changing anywhere near as fast. And to the extent that it is, the biggest change is that the United States is now the leading producer of oil and gas, which has actually made the market more global, not less global.
IAN BREMMER: And it's taken away a lot of the pricing power of OPEC, which is functionally destroyed as an organization right now. One of the reasons why Iran can hit Saudi Arabia last week and take 50% off of their oil production literally in a moment, right? In 20 minutes, it was gone. 5% of global oil production off. As you know, oil price didn't move that much. It would have if the oil market was less global, if it was still primarily about OPEC.
IAN BREMMER: It's not anymore. It's more global. And so despite all of the problems we see geopolitically right now, between the United States and China, I don't believe that that market, the market for stuff out of the ground is becoming any less global. It's really not. In fact, I mean, we can talk about the fact that we might put some tariffs on, and the Chinese aren't going to buy as many lobsters from Maine.
IAN BREMMER: He's buying from Canada instead. And I was with Trudeau last week. And I was kind of angry about that because Trudeau's claiming that the Canadian lobsters are tastier, and they don't actually mate with the Maine lobsters. We know this isn't true. [LAUGHTER] So we actually did have that conversation.
IAN BREMMER: It was kind of funny. But I actually think that, despite all of that, realities of demand and supply for commodities means that we're going to have a more global market over the next 10 years. If you're in that field, there's going to be more growth as a consequence. You want to be a food producer in this environment. You want to be someone that has the ability even transfer fresh water in this environment.
IAN BREMMER: You certainly want to be in things like rare earths. It's important, right? So that's one area of the economy. Globalization is still moving. Don't worry about it. A second area of economy is in basic manufactured goods and services. And that's a place where, my god, the last couple of generations, the last 40 years have just been extraordinary because all of these companies have been able to outsource a lot of services and a hell of a lot of manufacturing to markets where the labor is cheaper.
IAN BREMMER: That's what made China the country it is today. It's also what led to the BRICS, right? Brazil, and Russia, and India, and even South Africa, some people sometimes say. And it's what made Mexico happen. I mean, so it's why, when you have all this populism in places like Mexico and Brazil, and they throw out the bums, and they bring in complete outsiders, like AMLO in Mexico, and Lopez Obrador, and Bolsonaro in Brazil, there's massive anti-corruption.
IAN BREMMER: But these people are not against free trade. They're actually in favor of free trade. Where in the United States, the populists like Sanders and Trump, have a problem with free trade. And it's because, in those countries, those emerging markets, they're like, we grew our middle class and our working class on the back of free trade. We're taking advantage of that. That's good.
IAN BREMMER: So that's been a great, robust thrust of globalization. And what you are now seeing is, number one, wages have gone up a lot in these countries. So if you want to produce in China, you don't get the same delta in profitability that you did 10 years ago, 20 years ago, 30 years ago. Secondly, as I mentioned, no rule of law in China. So as a consequence, as their companies get more competitive, the environment is becoming more challenging for you to operate in.
IAN BREMMER: Third, and perhaps most importantly, is that, increasingly, you just don't need the same amount of labor in the capital equation. Why? Automation, robotics, right? I mean, so as a consequence, there are a lot of companies-- most of the CEOs I talked to in the United States, Fortune 500 CEOs will tell me that over the next 10 years, they think that they can make more money with fewer people.
IAN BREMMER: But because CEOs are overwhelmed with the short-term, with the shareholder returns, with the quarterly outcomes, and because, right now, markets are doing well and their profits are fairly high, and because the average CEO in the US lasts less than five years, they are not inclined to do very much about this right now. So right now, the globalization of that big, meaty piece of manufacturing and services is actually still humming along reasonably robustly.
IAN BREMMER: Now, there's no question that the new tariffs by the United States against China and the reciprocal are slowing that a bit, but not so much that it's really changing the footprint of these companies. So I'd say the globalization has slowed, in some areas maybe even stalled, but it hasn't reversed. And in fact, if you see what Trump has done over the last month, we're getting close to Christmas season, it's like, ah, I don't want to do too much more, and anything that affects consumers.
IAN BREMMER: And my buddy, Xi Jinping, he's about to celebrate the 70th anniversary of the founding of the Communist People's Republic. Of course, I also want to help him celebrate that. So we'll push off some of these tariffs for a month or so. Now, if you're China and you see Trump doing that, you're like, I know he doesn't care about that. What I do know is that, as we get closer to elections, he really doesn't want to hurt his economy.
IAN BREMMER: I know that I can actually wait this guy up. So we are seeing that stall. What's going to happen, though, is that when there is a downturn-- and I don't know when there is a downturn. I mean, there was a CFO survey last week. Over 50% of American CFOs said they expect a recession before the upcoming elections. Bloomberg monitors economists' sentiment.
IAN BREMMER: They think 35% likelihood global recession before the end of 2020. I'm not an economist, so I don't have a strong view on that. But I do have a strong view that when the next downturn happens, suddenly, all of these CEOs are going to have to now look short term and pare their costs. And so suddenly, you're going to see an awful lot of people get rid of footprint in emerging market labor. So the CEO of Walmart has far more people producing in China than he needs.
IAN BREMMER: And you know, he's had labor union problems. He's got cost problems. And if you can automate increasingly, and he's doing that with his distribution centers, why would you possibly want all of your manufacturing being in China? You might want it in China for the Chinese market. But you increasingly-- if you could start Walmart from scratch, there's no way that you'd be doing all that production in China for the rest of the world.
IAN BREMMER: You wouldn't. And so suddenly, we're going to see a rightsizing that, given this fourth-slash-post Industrial Revolution, and that means that it looks stable until there's a downturn. And then suddenly, supply chain is going to shrink. There'll be a bit of a shock. It's not going to-- globalization is not going to go away.
IAN BREMMER: The market's not going to be fragment. It's still going to be global, but it's going to be more localized. That'll be a change. OK. With me so far? Those are the first two. But there's a third part of the pyramid. And that is AI, big data, surveillance, right?
IAN BREMMER: Everything around that. And here's the problem. That third part of the pyramid-- which is the smallest of the three in terms of its value in the global economy right now, but it's there-- is not global at all, at all. It's fragmented in two-- the Chinese and the Americans.
IAN BREMMER: And no one else is close. So if you look at unicorn startups in the last year, 2018, valuation over a billion dollars in high technology, last year, 42% of those globally were US. 40% were China. 18% was the rest of the world. And that gap is getting larger. Europe and Japan are functionally irrelevant in this game in terms of entrepreneurship for the next major drivers of the AI revolution.
IAN BREMMER: And the Chinese and the American systems are increasingly not interoperable. Part of that is because the Chinese government has decided that they want to promote AI as the most important strategic sector. In fact, that by 2030, they want to be the global leader in AI, surpassing that of the United States. Some of that is because the Americans see major national security concerns with allowing the Chinese into our critical infrastructure.
IAN BREMMER: Huawei, 5G, supercomputing, surveillance-- you know, all of anything involving collection of data through chips. What that means is that we actually have two different systems. So on basic trade, we have a lot of interoperability, and we have a lot of reliance upon each other. As the Chinese would call it, win-win. In the AI space, it's increasingly zero-sum, which means we actively want the Chinese to lose.
IAN BREMMER: And that's a problem. So this top bit of the pyramid-- which, right now, is about digital commerce. It's about deep learning from big data. It's about surveillance, facial recognition. It's about the internet. But with 5G and the Internet of Things, over the coming 10 years, that top bit of the pyramid is the fastest growing part of the pyramid globally.
IAN BREMMER: And it's going to start including everything around life sciences and pharma. It's going to include everything around autonomous driving, smart cities, new infrastructure. In other words, the part that looks most problematic is also becoming the most strategic. And it's expanding in size very fast. That is a big, big problem, right? So that's the economic way of looking at this challenge.
IAN BREMMER: But I promised you two different methodologies. So now let me look at the geopolitical way. So Graham Allison reprised something that has been known in my field for a long time as the Thucydides Trap. How many people have heard of the three Thucydides Trap? I'm going to have to explain it. So the Thucydides Trap is when you look at a rising power and a declining power in a system, a regional system or a global system, that, most of the time, historically, that leads to war, right?
IAN BREMMER: Insecurity, not willing to make room, lack of understanding, you name it. In fact, the big study that was written about this over the last few years showed that in the last 15 cases of this globally, in 12 cases, you got war. When I sit down with Henry Kissinger, this is kind of something he always wants to muse about, whether or not war is inevitable between the United States and China.
IAN BREMMER: And even though he's 96, one-on-one, he is still super coherent, believe it or not, though he spills stuff all over himself. And then you're looking, like, do I help him with that because I want to? But I don't want to make him feel bad. And Sarah, my chief of staff, is like, Ian, don't touch him. Don't touch him. So anyway, that was a digression.
IAN BREMMER: But so are we going to end up at war with China? And first of all, I don't believe so. Though if we do-- surprise, surprise, it'll be in the area I just talked about. But let me give you the methodology for understanding this because China is not a global superpower in an integrated way, right? There are lots of ways that countries express power. There's economic power.
IAN BREMMER: There's technological power. There's military power. There's diplomatic and soft power. And it's important to kind of break those down. So if we look at the military space, China is not remotely close to the United States. The US actually spends not only much more than China. The US spends more than the next seven countries combined in defense.
IAN BREMMER: And in fact, even though the Chinese economy is poised to overtake the US in 10 to 15 years by whatever measure you want to choose-- some people think it already has. I don't buy those measures. That's beside the point. The gap between American and Chinese defense spending in the last couple years-- with the US now running a trillion dollar deficit-- that gap has actually grown.
IAN BREMMER: China today is a regional military power. Now, in those areas where China is a military power-- so in Asia, and, most particularly, in Southeast Asia, and around, say, Taiwan and Hong Kong-- we have a problem. It is zero-sum. We are not friendly. We are not allies. We are fighting, right?
IAN BREMMER: So I mean, they have this Nine-Dash Line, which actually brings Chinese influence, like in the South China Sea, right down to the borders of Indonesia and the Philippines. And they recently told Vietnam, if you want to engage in exploitation of resources in an area that is contested-- meaning, obviously, your seas, but we're saying they're ours because we're much more powerful-- you can only use-- you can only exploit it with regional expertise and companies, which makes sense because China has those and Vietnam doesn't.
IAN BREMMER: So just last month, Exxon Mobil, which has a partnership with Vietnam, stopped exploring joint research for resources in what anyone would say is Vietnamese waters because the Chinese pushed them out militarily, and the Americans didn't do anything about it. So in that region, there's a problem. But when you talk about Syria, or Iran, or Venezuela, or Ukraine, China is irrelevant militarily.
IAN BREMMER: On Venezuela, the Russians actually came in and provided military support for Maduro, right? And in fact, Maduro went to Moscow this week just to show how strong he was feeling. He can leave the country. No one can do anything to him, right? But the Chinese don't do that. The Chinese go to Venezuela. They meet with the opposition, that the Americans will recognize, and say, hey, we know we don't know you guys real well.
IAN BREMMER: But just to let you know, in case you happen to get into power, we'll work with you, too. You know, we still want to invest. You owe us 5 billion. You'll still owe us that money. But there's not going to be a military base there from the Chinese. So even though there's a problem between the US and China militarily, we're not heading to war, OK?
IAN BREMMER: In soft power, unlike the Russians in diplomacy, who actually feel really angry with us and, therefore, want to cause trouble-- they interfered in our elections. The Black Lives Matter site that had the most followers in the US during the 2016 election was not the official one, but an unofficial one that was actually fake and run by Russians, that the Kremlin put out because they like the idea of stoking racial disharmony in the United States.
IAN BREMMER: They did the same thing with Brexit. They did the same thing with the French elections and the National Front. They want to divide. The Chinese really have no interest in stoking racial dissent in the United States. I mean, they're actively involved in ensuring that Hong Kong Chinese only get the mainland story.
IAN BREMMER: Absolutely. They're actively involved in trying to ensure that Chinese expats in places like Australia are patriotic. But they're really not doing anything diplomatically to undermine the present global order outside their backyard. So diplomatically, not only are they not very capable-- they're a regional power-- but they also aren't even really a threat to the United States, diplomatically, right?
IAN BREMMER: Now let's get to the more problematic areas. Economically, they are a superpower. They're still smaller than the United States. But because the Chinese economy is driven by the government, they actually punch above their weight. So when the Americans tell other countries, don't join Belt and Road, even our allies join, because the Italians say, we've got to fix up this port in Torino.
IAN BREMMER: And you guys aren't going to do it, but the Chinese are. The Chinese are writing the checks. I was with the Greek prime minister yesterday morning. And he was talking to me about just how much they need American investment because, otherwise, it's all China. And when it's China, it's not the private sector. It's coming in with the state. We'll build the port.
IAN BREMMER: We'll build the infrastructure. We'll create jobs. It used to be China was only about exporting people and jobs. But now that their own demographics are shifting, it's much more about the capital and the infrastructure, right? So China is a superpower, economically. There is a competition. But the Chinese want a robust American economy.
IAN BREMMER: So when they engage in cyber attacks against the US, they absolutely try to steal things so that they can profit. They steal IP all the time, right? But they're not trying to break the US marketplace. They're not trying to destroy US banks because they want to trade with us. China's perspective is, look, we're getting bigger. And if we stay quiet about this stuff, over time, we get to run everything.
IAN BREMMER: But we want to run a robust economy. It is-- I mean, they're not about taking more land. They're about exploiting more markets. So here they are a superpower, and there are conflicts. But it's still win-win. They want to trade more with us, not less. They don't want a tariff war. And by the way, the tariff war, so far, that we've had between the two countries has taken about half a point of GDP off of Chinese growth.
IAN BREMMER: It's taken about a tenth a point of GDP off the United States. We're bigger. But also, we're just not as reliant, right? I mean, we have a big internal market. The Chinese need to actually export a lot more. This is more problematic for them. So nobody wins a trade war, but some people lose bigger, right? And it's important to recognize that. Now let's take that and look at your area.
IAN BREMMER: What's happening in technology and data? What's happening with content? And here is the area where the Chinese are a superpower and it's not cooperative, right? And let's first talk about how they are a superpower because, economically, everyone out there knew they were becoming a superpower. Everyone out there, for 20 years now, has been saying, we can see them becoming the largest economy in the world.
IAN BREMMER: 1.4 billion, right? But technologically, if you talk to Americans that are in Washington in the policy establishment, they'll say, well, they steal stuff, but they don't innovate. They're not entrepreneurial. And even five years ago, you could have made that argument. You can't today. Today the Chinese are actually a legitimate technology superpower.
IAN BREMMER: In fact, they're one of two. We're the other one-- no one else, as I mentioned before. In some areas, the Chinese are actually leading the United States, specifically in facial recognition and voice recognition. They have 800 million people with smartphones. Their data is integrated vertically with only a couple of apps that are much more capable than our apps are because everyone's on them, and they do lots of stuff.
IAN BREMMER: So that data's all being used to complete the same studies about human behavior, right? So last year, if you look at data, digital commerce in China was 50 times greater than the United States-- five-zero, five-zero. Ride sharing was 1,000 times greater in terms of total amount, data online. Any of you-- how many people go to China? OK.
IAN BREMMER: So you know they don't use credit cards, right? They don't use wallets. It's all smartphone. You want to go into a building? Increasingly, no ID. Just use your face. You're a Uyghur? You want to get thrown in jail. You don't need ID for that.
IAN BREMMER: They'll just pick you up off the street. It's not a problem, right? So I mean, that is a very different system. And the Chinese competition with the United States here is real. Now, do I believe that they will win? I don't know. I don't know. I mean, I will tell you that our entrepreneurs are a hell of a lot better than theirs.
IAN BREMMER: Theirs work harder. But ours are much more outside the box. The Chinese are better at figuring out how to commercialize existing AI applications. I suspect they will make more money out of AI in the next five years than we will. But they're not doing a lot of, what's the next moonshot research? So I was with Mustafa Suleyman, very good friend of mine, on Tuesday night?
IAN BREMMER: Tuesday night. Came by my house. He runs DeepMind. His is the firm that created the AlphaGo that not only beat the world's best Go master, but came up with a move no one-- an entire strategy that no one had remotely considered was plausible simply by studying brute force, what was happening, learning itself. And he told me, look, let's be very clear.
IAN BREMMER: What we are trying to do at DeepMind-- and by the way, everyone in the US is trying to do-- is, by 2045, replace all human beings with automated AI capacity. We're trying to create artificial general intelligence in the next generation or so. That's what their goal is. There are a lot of people working on that in US AI. Google is the leader.
IAN BREMMER: Microsoft and Amazon are close. There's almost no one working on that in China because they don't yet see the short-term applications for that that are going to make money. Now, there's no question that the Chinese are paying for a hell of a lot more people to do AI research in China. They're educating a lot more of them now. And they're also providing enormous amounts of cash to people graduating from universities in the US with a relevant STEM education.
IAN BREMMER: They're not only paying them more. They're paying their spouses. They're setting up research laboratories. They're giving them money for those research projects. And the Americans are, in course, increasingly telling those Chinese and others, you're not very wanted. Now, there've been changes. Trump was in Texas with Modi a few days ago. Modi likes Trump more than he liked Obama.
IAN BREMMER: The Indians are definitely feeling the love, and I don't see the Indians sort of reducing their numbers in a large way in terms of coming into the US to try to make the visa regime easier for them. But broadly speaking, American institutions of higher learning are feeling less welcoming for a lot of top scientists from emerging markets, especially those that aren't white, than they were two years ago, three years ago.
IAN BREMMER: And those numbers are changing, while the Chinese are doing everything possible to grab those people. So I mean, that's a problem, but it's a problem at the margins. The fundamental question is, what is AI going to look like as a marketplace? Is it the Manhattan Project? Or is it climate change? So Kai-Fu Lee-- who I know pretty well, and he's kind of the lead AI specialist in China-- he wrote this book called AI Superpowers.
IAN BREMMER: He believes that AI is dumb. It's basically all about getting more, and more, and more data, and just doing pattern recognition, learning from that data in ways that human beings could never do, but computers are very well suited. And he thinks that's what's going to happen for the next 20 years. And if he's right, the Chinese will probably win because they will simply have vastly more resource they can throw at it.
IAN BREMMER: And the government will be aligned making that the most important strategic sector. He could easily be wrong. Most people I know in the US, like Reid Hoffman, and Eric Schmidt, and Mustafa, who I just mentioned-- the aforementioned-- they believe that, actually, AI breakthroughs are like climate change. 30 years ago, we knew climate change was coming.
IAN BREMMER: But we didn't know if we were going to make big breakthroughs in cold fusion or if it would be stupid. We didn't. And it turns out, so far, it's been stupid, right? But even Al Gore didn't think, 10 years ago, that solar would be cheaper than coal by 2020. And it is, right? That's extraordinary.
IAN BREMMER: But you need to be taking an awful lot of bets on weird technologies that aren't yet developed in order to find out what you're going to do to respond to climate change. Now, the Chinese are now the largest solar panel producers in the world. But the basic research in all the big new breakthroughs on things like carbon sequestration, taking it out of the atmosphere, geoengineering, shooting sulfur particles into the stratosphere that would actually reduce the temperature of the planet, that's all being done overwhelmingly in the United States.
IAN BREMMER: If it turns out that AI is more like that, then it's likely the Americans are going to win. We don't know. And I mean, honestly, I'm not trying to lean you towards, oh, it's OK. It's going to be the US. We don't know. But we do have one other problem. And that problem is that there's a coincidence of two things that are happening at the same time.
IAN BREMMER: On the one hand, the Chinese have just become a tech superpower, and they have decided that this is the most important thing their government needs to invest in to ensure that they will never be left behind again. So in the last year, the major lesson they took from the fight with the United States is, we will never be so vulnerable for our supply chain on semiconductors. We will build them in China.
IAN BREMMER: And those we can't build, we will make sure we have control over the countries that actually build them, or there will be hell to pay. Which means Taiwan-- of course, China will be able to lock that up-- and South Korea, where they're making huge headway. If you want to know why it is Xi Jinping was actually the one hosting the Japanese and South Korean foreign ministers in order to try to get them together, that's why.
IAN BREMMER: That was just a month ago. So that's what China is doing. That's one thing that's happening. But the second thing that's happening is, inside the United States, we're getting really angry at these tech companies. We've got people saying, they're destroying democracy. And I don't think they're intentionally destroying democracy.
IAN BREMMER: I think it's a byproduct that's purely unintentional of their business model. But it's a problem, right? I mean, fake news, and the filter bubble, and the polarization that comes from only reading things that you agree with and like because that's the way you maximize advertising revenue from the products, who are American citizens, right? That's a problem.
IAN BREMMER: But it means that, in the United States, an awful lot of people are not focusing on China building what may be the world leaders in AI, instead are focusing on, we have to regulate and even maybe break up our tech companies. Because in the '70s and '80s, you didn't have people in the US saying, we need to break up Lockheed Martin, or Lockheed-- before it was Lockheed Martin-- or Raytheon, or Northrop.
IAN BREMMER: We said, oh, these are the most important companies. And they're so important that we can't even let them go bankrupt. The first time the term "too big to fail" was ever used was not about a bank. It was describing Lockheed in the '70s. Because if we let them go bankrupt, we'd be too vulnerable to the Soviets. You don't hear anyone saying that about Facebook, Mark Zuckerberg.
IAN BREMMER: No one is saying that. And yet it might even be more true. It might even be more true. I mean, actually, Mark does say it. But nobody wants to listen to Mark right now. He has other problems. OK. Before I go to questions-- and again, this is what you asked me to talk about, so I'm really focusing on this.
IAN BREMMER: And I'll go anywhere in the world you want to. I'm going to do geopolitical stuff. Some of you guys know me. But let me talk at least a tiny bit about the rest of the world. I have not mentioned Europe one bit because they are not relevant to who's going to win. But Europe is a superpower. They are not an entrepreneurial superpower.
IAN BREMMER: They are a regulatory superpower. Europe has the largest common market. And their regulators are capable. Their tech regulators are vastly better than American tech regulators. And for an obvious reason. The United States, it's all about animal spirits. The United States, it's all about special interests, lot of money.
IAN BREMMER: So in the US, the regulators get captured by special interests who have cash. On the right, big oil, big finance, Big Pharma. On the left, teachers, unions, trial lawyers. I mean, you name it, right? And it really hurts the viability and efficiency of the system long-term for the American citizens. But that's the way it works. What that means is, if you are talented, you don't want to be a regulator, right?
IAN BREMMER: I mean, if you've got a kid, an all-star kid, you don't send your kids the Department of Commerce. Maybe a middle child you don't care about, but not the star. You want that kid in McKinsey or Google, something good-- Goldman even still maybe, right? Yeah. Yeah. Want them publishing, absolutely. So the Eurasia Group, let's do it.
IAN BREMMER: In Europe, if you have a talented kid, working in Brussels on tech regulation is a big deal. It's a big job. You matter. It's patriotic. It's impactful. They're the largest common market in the world. Margrethe Vestager, who is in charge of this stuff right now, is seen as one of the most powerful Europeans, one of the power people globally, one of the powerful women in the world, you know?
IAN BREMMER: I mean, Christine Lagarde, ECB, same thing. European institutions really matter. We talk about how there's all these problems inside European countries. The Italian government that just fell apart. The UK Brexit disaster. But at the European level, the EU level, actually, they're stronger now than they've ever been before. I mean, von der Leyen, and Gentiloni, and Investasure, and all of these-- I mean, these are very serious, strong, pro-European-- we're going to use our weight to actually regulate.
IAN BREMMER: And that's why-- I mean, I heard in the opening, people talk GDPR, Right I mean, privacy, copyright. The Europeans are driving an awful lot of regulations that, in America-- in California, for example, they're picking them up. Now, unfortunately, the Europeans aren't working very well with the Americans. In part, because Trump is a unilateralist. In part, because the Europeans historically like to do this stuff themselves more.
IAN BREMMER: And they see it as their power, especially because you see a lot of inequality growing in Europe. And since the big companies are American, it's very easy for Macron to say, let's put a tax on Facebook, because that's not going to hurt him. That's just a tax, right? But in part, it's also Snowden and the knock-on effect from the American National Security Agency that was spying on Merkel, unbeknownst to Merkel, and her private cell phone.
IAN BREMMER: And so there's not a lot of trust between these countries. So right now, the Europeans are trying to see if they can go a third way. They can't. There is no third way. They will not build these companies. They won't. So what we need-- it's not going to happen.
IAN BREMMER: But what we need, what your industry should be pushing for, is a WTO for data. What we need is something that is actually aligned on these things with all the countries that actually have rule of law that the Chinese would then need to join. Because if they don't join and align with it over time, they can have their own system, but they'll be left out of all the key markets.
IAN BREMMER: You don't want the Chinese to divide and conquer. You don't want them picking off individual, poorer European countries that need their cash. But I mean, if you asked right now, is Trump prepared to promote multi-- I mean, I was with Jared yesterday morning. And Jared's perspective is, hey, we're just about to finish a US-Japan trade deal, which is as good as TPP.
IAN BREMMER: That is the Trump perspective, right? And I told him, I'm like, I get it. It's high standard. It's really good you guys are doing that. But it's very different to have a bunch of bilateral deals than having one multilateral regime that everyone has because all those bilateral deals are different. And you get picked off by the Chinese.
IAN BREMMER: And you cannot make that argument with Trump. You just can't. And I'm not sure you can make that argument with whatever democratic contender you're going to have. Keep in mind, TPP, it was a huge strategic mistake for the US to pull out of TPP. Everyone blames Trump. But it wasn't like Obama got it done. It was the single most important foreign policy initiative he had, the pivot to Asia.
IAN BREMMER: He failed. He failed. And he failed knowing the politics were going to be harder for the next president. Knowing Trump had a shot. Knowing Bernie Sanders had a shot. And he said, I'm going to kill it. Knowing that Hillary Clinton, who was a freaking architect of the thing, said, well, I couldn't possibly pass it the way it is.
IAN BREMMER: I'd have to change it because America's changed on trade. So you know, look, I am no Trump, MAGA-wearing, whatever the hell it is. I'm just a political scientist. But I'm not going to lie to you people about it. I mean, the challenges are much deeper than that. Well, I've just done 40 minutes. They've given me an hour, which means that there is 20 minutes remaining.
IAN BREMMER: I'm not I'm not a mathematician, but I got the basics. So do we have microphones that are floating? Or do I have to-- you just have to shout? You do have microphones. OK. So if you raise your hand-- and there's one in the back that's going to start here. And I expect with this audience, I'm going to get lots of hands. There's one here.
IAN BREMMER: The one with the microphone already told me that she's going to ask question, so that's a third one. My buddy Niko-- and I'm here for him because we ran the-- he runs the Oxford Press. Everyone love Niko? Does everyone know Niko? [APPLAUSE] OK.
IAN BREMMER: Good. Because we've been besties for like 15 years, something like that. We ran the New York Marathon together which, we're never going to do again. And he told me you guys are awesome, and could I please come down and do this to kick this off? And I'm like, yeah, Niko. Of course I'll do it for you.
IAN BREMMER: So that's-- if you didn't like it, it's his fault. But otherwise, I expect that Niko should have just more love as a consequence of this. That's kind of the big take-away. Yes. Go ahead.
AUDIENCE: I'm Tyler from a software company. [INAUDIBLE] position. Know a lot of people getting a machine learning field. And I just want to push back a little bit on the idea that there's another AI innovation coming, like deep learning, which is essentially a 40-year-old technology. That was operationalized because of hardware. And DeepMind just lost like $500 million. So the idea that the choice that you had between success of China and the success of the US, if it hinges on a technology similar to deep learning coming out rather than just applications, then it's already over because we're looking at another 30 to 50 years before a similar idea emerges if you look at sort of historical patterns.
AUDIENCE: So--
IAN BREMMER: Look. So number one, that's a great point. And I was talking to Nick Bostrom last week, who wrote Supercomputing--
AUDIENCE: [INAUDIBLE]
IAN BREMMER: [INAUDIBLE]. Shoot. Name of it was-- so name of the book was again, so everyone knows?
AUDIENCE: [INAUDIBLE]
IAN BREMMER: Name of the book.
AUDIENCE: Superintelligence.
IAN BREMMER: Superintelligence. Which, I mean, by many in the AI field, is considered to be like the most seminal book that's been written in the last 10 years. He wrote it, if I remember correctly, in 2014. And so what I-- and one of the things he did in that book, which I'm sure you've read-- I mean, I'm-- you haven't read that book? OK.
IAN BREMMER: Will you please read that book? OK. Because that's kind of like the-- at the time, one of the things he did was he looked at-- he basically talked to all of the major people working on AI around the world, all the major scientists, all the major technologists in the field. And he was asking them the same basic questions. And one of them was about, do you believe artificial general intelligence is possible?
IAN BREMMER: And if it is, when it's going to come about. At the time, 80% thought it was possible. And they thought it would come out around 2045, 2050. So when I saw him, the first question I asked him is, it's been five years since you wrote the book. Has that changed? He says, yes. First of all, people are much more convinced it will happen, and they believe it will happen by 2040.
IAN BREMMER: I was very surprised by that. Now, the caveat that you made at the end of your question is, nothing is going to happen in the next 20 years if historical trends apply. My counterargument would be, a lot of technology developments, historically, have been asymptotic. So you know, are we going to have the same-- is it going to take another 40 years? And the answer is, probably not.
IAN BREMMER: Now, look. If we have mass-- if we have a major climate cataclysm that creates a depression, then you're going to kick a lot of this stuff out, right? And that's a real problem. And I do think that there are going to be big headwinds in the global economy over the coming 20, 30 years.
IAN BREMMER: But I will say that I've personally been surprised at just how many things, and how many jobs, and how many sectors that we thought would not be as disrupted by present types of AI have been more quickly than people presumed. And I wonder if that means that the next major breakthrough-- I'm not the scientist. I mean, if you asked me this question about a geopolitical question, I'd have a lot of primary research I could back it up with.
IAN BREMMER: Here, I'm basically telling you, here's the state of the field. Here's where these people are. And you know, you can sort of take a whack at DeepMind. But actually, Brad Smith, the guy that just wrote Tools and Weapons-- also a great book. Sadly, not an Oxford University Press book. But you don't have to buy the book. You can just read the reviews that are out there. That's OK.
IAN BREMMER: I mean, he's the number two at Microsoft. His view is largely the same on this. So I mean, I do think it is, broadly speaking, a Silicon Valley view. I'm a little worried that the Silicon Valley guys are drinking a lot of their own Kool-Aid. I think that is a problem. And if the world is moving the way I think it is, that means that over the next 10 to 20 years, these largely libertarian companies are going to become much more strategic and aligned with the US government.
IAN BREMMER: I think Jeff Bezos gets this more than the other guys do. I mean, he bought the Washington Post. He spent $28 million on his house in Washington, DC. I don't think that's vanity project. I think he's actually now looking to, how can I build out massive US technology contracts? And if you believe that we're actually heading to the IoT, where it's not about your smartphone, but it's actually about an ecosystem of all the data around you which means where you live, then I think what Bezos wants to do is he wants to be the tech provider for all Americans that are in low-cost government housing.
IAN BREMMER: Amazon families, Amazon products, Amazon infrastructure. And if you think that that inequality is going to grow, and that a lot of people aren't going to have jobs, and we're going to need universal basic income, this might be the smartest single business model in the world right now in the United States. It is dystopian as shit, OK? But that's why Jeff is building rocket ships, too.
IAN BREMMER: He doesn't want to deal with it. He just wants to profit from it. So I do kind of worry about that, OK? Did I just blow your minds a tiny bit? A little bit? Come on. Oh, good. I'm glad. OK.
IAN BREMMER: Who was next? Was it over here? Right here. Byron. We'll get a microphone coming to you.
AUDIENCE: Byron Mosman, Nova Techset. I wonder if you could talk a little bit more about India and their economic development, how that plays out, from your view, over the next 20 years or so.
IAN BREMMER: So it's interesting. I was with the Colombian president last night. And I was asking-- we had about an hour. And at the end of the conversation, I asked him, so tell me, you talk-- we're talking mostly about Venezuela, and the US, and stuff like that. I said, tell me, any surprise meetings that you had, any things that you didn't expect that now matter to you.
IAN BREMMER: He said, yes. Said, Modi. He said, I am amazed by his universal ID system. I need it in Colombia now. Really interesting, right? I mean, I think that, for countries that are lower income, that are working on strapped budgets, that need to get rid of corruption, and find a way to get those budgets directly to people and bypass bureaucracy, Modi has done a better job in figuring that out than anyone because he's the guy with the 1.4 billion person population with massive decentralization of power.
IAN BREMMER: Breathtaking, staggering corruption inside the party, inside the labor unions, inside the provinces, inside the cities. You can't build a goddamn thing in infrastructure unless you pay all of them off. He's like, I've got to find a tech way-- which, by the way, is a top-down authoritarian way-- to ensure that I can bypass all this stuff. So I think Modi gets that.
IAN BREMMER: But let us not forget just how far behind India is. This year, the Indian government will spend, despite-- after four years of Modi working as hard as he can to build up growth and focus on infrastructure, India will spend 10% on its infrastructure of what the Chinese are spending on theirs. 10%. Both countries, 1.4 billion people.
IAN BREMMER: Every day, India is getting further behind. They're not getting closer. This is winner-take-all stuff. So I like India. I'm going there again in a couple of months. We've got clients there. It's a pain in the ass. The air is vastly less breathable than China. Again, I'm sure you know that.
IAN BREMMER: Their ability to deal with it is virtually zero. They desperately need people to get on to the grid, which means mostly coal-fired plants, where in China, they're moving away from that. This is all-- I mean India has massive hurdles. They're growing this year about 5%. When Modi was running Gujarat, Gujarat was running a 10. Lot harder to run India. So they're moving in the right direction.
IAN BREMMER: They just brought corporate taxation down, which, in the last few days, they finally have a national goods and services tax. They needed that 20 years ago. I mean, they have a leader that is moving that country in the right direction. There are other emerging markets around the world that are also engaged in real economic reform. Duque in Colombia is one.
IAN BREMMER: Bolsonaro, horrible for the climate, but economic reform? My god, he's doing what needs to be done in that country. You can find these people, but it is really late. And the global economy is about to head into a cyclical downturn. I don't know how big it's going to be. But you know, again, this is the longest period we've gone without a recession in modern history in the United States.
IAN BREMMER: Nobody thinks we're growing more than 2% next year. And that means you're going to lay people off. And the US is the driver of the global economy, still much more than China. It's going to be a problem. So I mean, I think India needs a lot of things to go right for me to get more excited about them than I am right now. But you know, if you're asking me, do I think India is a robust place to be selling books going forward and-- selling content, excuse me.
IAN BREMMER: So yeah, of course I do. In fact, for my own media company, I'm probably more-- India's in my top five places that I want to get distribution licensing on it because it's just an extraordinary, large, literate urban population that speaks English and cares about this stuff. So you know, that's kind of exciting. There was-- who else? Was this next one?
IAN BREMMER: Is that right? OK.
AUDIENCE: Great talk. [INAUDIBLE] I'm curious about Africa. If you see the UN population forecast to the end of century, the outcome there is a population bigger than the US. Nigeria is [INAUDIBLE] size of China. When does Africa actually arrive [INAUDIBLE]??
IAN BREMMER: Well, number one, Africa today is, we're talking, 2% of the global economy. So I mean, they've got a lot of people. But all of the problems that are in the world, Africa has a vastly greater share of them. We're going to hit 3 degrees, 3.5 degrees warming minimum over the period of time where their population is going to expand massively. The variance on what their population might be by 2100 is, by far, the largest unknown factor in those UN reports.
IAN BREMMER: That population will grow a lot faster if they don't urbanize, globalize, and get wealthier. Keep in mind that the extreme weather conditions, what happens when you get 3.5 degrees warming, in Equatorial Africa is vastly greater than anything else in the world. It's massive. It's a real problem. And you're already seeing, because of the internal, the intrinsic opposition to GMOs, you're seeing that maize production in places like Kenya is down about 27%.
IAN BREMMER: It should be up. That's a cassava. I mean, I was a-- Gates Foundation is a client of ours. I work with them closely. This is the thing they're worried about mostly right now, is that they're just not able to build them. And you've actually had an increase in poverty levels in most of sub-Saharan Africa that is outstripping the population growth.
IAN BREMMER: Only place in the world that's happening. It wasn't happening five years ago. Now it is. There's some countries, like Rwanda, that are governed better. And so poverty is going up, but slower than the population increase rate. Absolute poverty in Equatorial Africa, almost across the board, actually outstripping population growth.
IAN BREMMER: So, look, I'm going to Ethiopia in two weeks. No, four weeks-- in a month. And you know, I'm very excited about looking in a lot of [INAUDIBLE] in a lot of these cities for human capital stories that I think are going to be massive because they're the ones that are going to figure out the responses to what they need on the ground, because no one else is. The Americans, the big companies just aren't paying much attention right now.
IAN BREMMER: And when we see a contraction, they're going to go-- first of all, it's a great place to, I think, spend that time. But those are tiny plays. The big plays? Are we going to talk about the Africa miracle, the Africa story? Oh no. Absolutely not.
IAN BREMMER: Greta's a little too late for that, right? For those of you that saw her this week. Any more? Because you don't want me to just ramble. We can go anywhere. Yeah. Right over here.
AUDIENCE: Thanks very much for your talk. Lauren Kay with Delta Bank. I'm wondering if you could comment about censorship. Some of the publishers in the room have had an issue with China with having to remove access to certain articles, certain publications in order to more broadly maintain access to their aggregations.
IAN BREMMER: Yeah. There'll be more of that. [LAUGHTER] No. And the Chinese are exporting it. The DRC, Zimbabwe, Pakistan, Lao, Cambodia-- there are a number-- I mean, early Belt and Road investments were focused on building ports, building railways, building highways.
IAN BREMMER: And those are things that, even if we would rather if the Americans built them, we generally want them to be built because, if you build a port, anyone can use it. If you build a port, everyone does better as a consequence. They are now starting to export data regimes. They're exporting 5G. And I mean, unless the Americans destroy Huawei-- and I don't think we'll destroy it.
IAN BREMMER: I think we may make it a very different company. That means that the Chinese are going to start exporting surveillance mechanisms and data to these other countries. So you'll need to start paying more attention to where censorship-- I mean, you'll need to understand what kinds of censorship are particularly vital to countries that have data regimes that get locked up by the Chinese.
IAN BREMMER: And you will need governance to deal with those things over the next five years. That'll be important to you. Now, keep in mind, the Americans are also exporting these technologies. Palantir was exporting the same sort of technology to the Saudis. The Saudis engage in very significant censorship. They've gotten an awful lot better at it on social media and the rest, especially around issues like homosexuality, for example, because of American exported technology.
IAN BREMMER: The Israelis are doing the same thing. But we're just doing it for profit. The Chinese are actually doing it not for pleasure, but for longer-term strategic alignment, as well. And that is more important. And Palantir can go under. And then they have the technology, but whatever. Where if the Chinese are doing it, it actually does tend to have longer legs as a consequence.
IAN BREMMER: Yeah. Back there. Over here. First in the back. Yep. And then there.
AUDIENCE: You gave a great speech. Andrew Harmon from the Endocrine Society. And I just wanted to point out that some of us here are from nonprofits. We're from organizations that represent researchers, many of whom get their funding and their salaries from government, from government grants. This downturn in the global economy that you're seeing, foreseeing, what do you see being any long-term effect on the nonprofit sector?
AUDIENCE: And what can we do about it either ahead of time or in response?
IAN BREMMER: Well, I mean government funding for nonprofits in the United States is clearly going to be under a lot more challenge. It will be globally given that downturn. But I think the importance of nonprofits, the recognition from the private sector that you need to partner with these guys in order to get things done because you're not seeing governance work properly, is going to grow. So I mean, there's no question in my mind.
IAN BREMMER: I mean, if you look at where you're going to see the experimentation come on universal basic income, or on the gig economy, or on changing the social contract, nonprofits are going to be leading the way, and also hybrid organizations that aren't necessarily nonprofits but are, themselves, quite entrepreneurial in their do-goodedness. So generally speaking-- look, I started a foundation that Niko's on the board of, the Eurasia Group Foundation.
IAN BREMMER: I would not have done that 10 years ago. I'm doing it now because I feel like there's much more space for an organization like ours to contribute to better understanding what some of these challenges are going to be globally. And I think that they're just an awful lot, especially if you're living in a node. If you're living in a super city, where you have the-- well, you can use your people, and network them effectively, and get that message out, it makes a big difference.
IAN BREMMER: But I do think the nonprofits are going to become unequal, too. I mean, first-tier cities globally is where you're going to have 99% of the nonprofit activity. And most of that money will be devoted locally because people care about their tribe. They care about their community. So the thing that worries me most is that the flyover country, which includes an awful lot of cities that aren't first tier, they're not going to have talent.
IAN BREMMER: People aren't going to be paying as much attention. Because so much of this money is going to come from the corporates, and the corporates are going to want to say, where are we? We do care more about just than our shareholders. We care about our client base, our consumers, people that could call it cause trouble for us in social media. They're all in the same place. So the thing we most worry about is-- and this is, again, why I think the Bezos model is so inspired, but nefarious.
IAN BREMMER: Over here. Yeah. Oh, yeah. And then you.
AUDIENCE: Hi. Burt Corelli--
IAN BREMMER: This is your last one.
AUDIENCE: [? --MD. ?]
IAN BREMMER: Yeah. Hey.
AUDIENCE: So a lot of people in this room represent organizations that are faced with the big challenge of what we call open science or open access. The expectation of the market, that a lot of the things that have been published and have been sold traditionally through subscription models are disappearing and going to open and free access. So maybe from the perspective of Time Magazine and other forms of media that faced that 10 years ago, 20 years ago, what advice can you give to people here?
IAN BREMMER: [SIGHS] I mean, look. A lot of people are getting displaced. A lot of models are getting displaced. I mean, this superstar, winner-take-all economy where, if you're in the top of your field in content, whether it's in music, or it's sort of as an expert, or it's a talking head, or whatever it is, and then maybe 2% of the people can make a living, and everybody else is functionally operating for free, I think that's a huge problem.
IAN BREMMER: My response to that-- so when you talk to me about universal basic income and how it's not going to work, it would certainly work with creatives. There are an awful lot of people out there that are working their tails off at jobs they find completely uninspiring to allow them to make a basic nut so that they can do the things that they think would make a positive contribution to humanity, and certainly give them a sense of purpose and value.
IAN BREMMER: Everyone that hates UBI says, well, because the people won't have purpose and value. Well, no. Working in a job that is completely dehumanizing, and destroys your health, and destroys your family is clearly worse for you spiritually, right? We all know if you can spend more time with your family and you don't have to worry about doing something dehumanizing, you're actually happier as a human being.
IAN BREMMER: So I would love to see more of these early-scale UBI projects oriented towards populations where we kind of know the hurdle rate isn't as great. And I mean, you know, we'll see. I think that-- I think it's going to happen. I do think those things will happen because, since it's not going to be top-down, you're going to have people that are connected that say, we want to make a difference here.
IAN BREMMER: I don't think it's about Mark Zuckerberg saying, we're going to invest in a few local newspapers. No, because those models are going away, right? I mean, that's clearly happening. I mean, you know, it's 5% of all advertising is in newspapers right now in the US. 3% is radio. It's not, how do we save newspapers? It's more, how do we save the people that are producing the content that's critical to-- creating a civil society is something that we're proud of, without going into the Chinese model.
IAN BREMMER: And that is an open question. Because if the data universe is fragmenting not just between the US and China, but also between classes inside the world as we move to ecosystems of data, then those people are not going to-- they're not going to talk to each other. They're not going intermarry. They're not going to interrelate.
IAN BREMMER: We're in a very different type of civil society than we have right now. So we have time for one last question. Before I do, I'll just tell you guys, we actually have-- if people want to stay in touch afterwards, we have this newsletter we put out called Signal, which is completely free for folks. If you have business cards and you want, I'll make sure that-- Sarah will make sure that we sign you guys up.
IAN BREMMER: As I'm done, just grab a card, and throw it at me, and we'll have an excuse. Niko's a subscriber. He likes it. Please, go ahead.
AUDIENCE: Hi. Thank you very much. Allison Belan with Duke University Press. So with the trade, Trump has a specific interest in that. And he actually-- it's something he has a, well-- well, a formed philosophy on. And he's impacted it. Has he or his administration had any impact on the technology and innovation arc that you're describing?
IAN BREMMER: They haven't in the United States, not domestically. They really don't have any people that are oriented towards that yet. There was this Technology Council that Chris Liddell, who used to be the CFO of Microsoft, is now running in the White House. It's badly understaffed and also kind of fell apart after the Charlottesville stuff, when some of these council-- the CEOs no longer wanted to be seen as traipsing to the White House and supporting Trump on a regular basis.
IAN BREMMER: So now it's more one-on-one. But he's definitely having an impact globally. So number one, I mean, when you actually see all of these companies in China that are put on a watch list where they're not allowed to do business in certain areas, that's not just about the US. It's about other companies in other parts of the world that want to bank with the US.
IAN BREMMER: We've got the reserve currency. We've got the banks that are big. So I mean, like when we pulled out of the Iran deal, a lot of countries complained, but they all stopped buying Iranian crude. It wasn't just the United States, those sanctions. That is what's happening on tech right now. And I haven't spoken to the Chinese leadership in the last couple of weeks, but I have spoken to the Chinese ambassador to Washington.
IAN BREMMER: And he said that one of the red lines with getting to a deal is that it's OK if Huawei can't get their supply chain in the US. But the United States has to allow Huawei to operate in other countries. And that is not going to happen. Even though Trump says, I can get you a deal on Huawei, to Xi Jinping directly, when Lighthizer and others, Peter Navarro, are then talking to the working sessions with the Chinese, they're saying, yeah, but he didn't mean that, right?
IAN BREMMER: He meant they can do headsets, handsets. That's a real problem. So I do think that the US government is moving in a direction that is trying to ensure that if the Chinese are going to build their own platforms and data, that American allies will absolutely not be a part of that. And that's going to be a fight. The Kazakh president, yesterday, had just met with Xi Jinping.
IAN BREMMER: And Xi Jinping pushed him really hard. He said, I need you to do 5G and Huawei. And I said, what did you say? And he said, I didn't say anything. So I mean, this is a hard problem for a lot of these folks. So again, thank you all very much. I hope you found it worthwhile. And I hope you enjoy your meeting.
IAN BREMMER: Cheers. [APPLAUSE]
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