May 7, 2024 • 25 mins
Nobel laureate and economics professor Joseph Stiglitz joins Francine Lacqua, Allegra Stratton and Adrian Wooldridge to explain why he feels the political right has warped the true meaning of freedom.
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Speaker 1 (00:03):
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:10):
The freedom of one person may come at the expense
of the loss of freedom or the unfreedom of others.
Or is the great Oxford philosopher Isaiah Berlin put its,
freedom for the works is often meant death for the sheep.
Speaker 3 (00:26):
Welcome to the City of London, the City of the City,
of the City of London.
Speaker 1 (00:32):
These mind the gap between the.
Speaker 4 (00:37):
The financial hearts of the country.
Speaker 3 (00:43):
The city, the city.
Speaker 2 (00:45):
Welcome to in the city, and clear of the doors.
Speaker 1 (00:53):
Another week, another look at the conversations motivating policymakers and
financiers around the world.
Speaker 4 (00:58):
I'm Francis Lacqua and alegra Stratton back with you in
the London studio with Fran myself and with Dave out
for one more week. We've brought along some help from
the voter Nomics crew. Welcome opinion columnist Adrian Wildridge.
Speaker 5 (01:11):
Good afternoon.
Speaker 3 (01:13):
He's reading a book while we speak.
Speaker 1 (01:15):
Adrian really a big brain on all things economics, history,
A bit of a historian, Adrian, is how I would describe.
Speaker 5 (01:22):
I know nothing about the economic I know about history.
Oh we're not recording this, we are.
Speaker 3 (01:33):
It's good.
Speaker 1 (01:33):
I think it's great Fred shall run that sorry.
Speaker 2 (01:40):
Is this me?
Speaker 3 (01:40):
Okay?
Speaker 4 (01:41):
You just have from our guests this week, Nobel Prize
winning economist Joe Stiglitz he joins us in the London
Studio for a conversation on his newest book, The Road
to Freedom, Economics and the Good Society.
Speaker 1 (01:52):
Stiglitz served as chair of the White House Council of
Economic Advisors during the Clinton administration. Five years after leaving
the White House Globalization and its Discontents.
Speaker 4 (02:03):
He subsequently wrote several more books hitting topics like the
global financial crisis and inequality. And given the success of
those books and of course the noble, I think it's
fair to say he's a pretty famous economist.
Speaker 1 (02:14):
Hey, fran I would say so. Joseph Stigodz, welcome to
in the City. You wrote a very interesting new book
talking about freedom and economics. And basically the premise of
the book is that maybe we've gone too far in
capitalism and that it's hurt people's freedoms.
Speaker 2 (02:32):
That's right, particularly the form of capitalism called neoliberal capitalism,
which in its very name talked about liberal meant freeing.
It was about getting rid of regulations, lowering taxes, giving
enterprise more freedom to do, but that had the effect
(02:54):
of in many ways taking away other people's freedom. And
an example, freedom to exploit others takes away the freedom
of the exploited. In fact, when the drug company has
raised their prices to skyrocket levels, the right to live
of others is taken away. Freedom to bluet means climate
(03:17):
changes there if you have asthma, you may die. And
other example that we saw very strongly in two thousand
and eight, freedom of the banks to engage in risk
taking and to exploit credit card abusive credit card practices
meant in the end we were all forced to bail
(03:38):
out the banks. We lost our freedom. So one of
the central messages of the book is that the freedom
of one person may come at the expense of the
loss of freedom or the unfreedom of others. Or is
the great Oxford philosopher Isaiah Berlin put its, freedom for
the woofs is often meant death for the ship. And
(04:01):
we've been going through something like that in the United
States and around all the countries, in the bank's countries
where neoliberalism has predominated.
Speaker 5 (04:11):
I wanted to ask you a little bit about Isaaa
Balin and his two concepts of liberty, which is his
inaugural lecture in Oxford in nineteen fifty eight, and he
distinguishes between negative and positive freedom, negative freedom being freedom
from interference or coercion from outside, and positive freedom meaning
freedom to be educated, be well fed, be looked after
(04:34):
by the welfare state.
Speaker 2 (04:35):
I approach the concept of freedom as an economist. I
don't want to pretend that I'm solving all problems, and
for an economists, freedom is about what you can do,
your opportunity set. Somebody at the point of starvation doesn't
really have freedom. He does what he has to do
to survive. Wealthier people have the possibility of making more choices.
(04:59):
So for me, those two ideas are intertwined. When somebody
harms you, it takes away what you can do. If
they harm you by giving you COVID nineteen, you're put
in the hospital, and that takes away your freedom. And
the same way if you don't get an education, if
(05:20):
you don't get healthcare when you're a child, your freedom,
your opportunity set what you can do, is thereby diminished.
So in a sense, I think he has distinction between
positive and negative freedom is a little bit artificial. What
really matters is, in the end the choices that you
(05:42):
can make.
Speaker 5 (05:43):
Now, what are the implications of your more expensive view
of freedom? In terms of public policy.
Speaker 2 (05:49):
It means that we have to be very sensitive to
how one person can harm another, but we also have
to be sensitive to how we electively can do things
that can expand all of our opportunities, expand all of
our freedoms. An example I give is traffic likes. Traffic
(06:12):
likes are a regulation. They seem to be taking away
your freedom. You can go until you get a green,
you are constrained. It a kind of coercion. But think
about life in London or New York and the absence
of traffic likes, you wouldn't be able to move anyway.
There would be gridlock. That little coercion has expanded our
(06:35):
freedom to do. They're an intrusion from government, you might say,
really expands our freedoms collective, our collective freedoms, our individual freedoms.
And that's where Isaiah Blin's distinction between negative positive is
a little bit wrong. There is coersion there. A coersion
(06:55):
can be freeing.
Speaker 3 (06:56):
Professor the state.
Speaker 4 (06:57):
It's kind to ask you how much you're following the
UK because you have these two different concepts of freedom
expressed within the right. So we have inside the Conservative
Party Liz Truss, who spends a lot of her time
in your country on the lecture circuit talking about in
your categorization that kind of old idea that the right
owns this freedom agenda. And then you have Rishie Sunak
(07:18):
who's just put through Parliament a smoking ban. On the
one hand, you've got Liz trust saying I cannot vote
for this, and lots of people by the way supporting
her within that party saying we cannot vote for this
because it is taking away people's ability to choose, their
freedom to choose. And then you have a Prime Minister
of the right who is saying, is it really that
free to be damaging allowing people to damage the health.
So I'm just wondering if it surprises you that you
(07:39):
see this with a within a politician of the right or.
Speaker 2 (07:43):
Not a surprise. There's second hand smoke, and we know
second hand smoke hurts other people's health, So you are
hurting other people's health. And more moreover, if you smoke,
you're going to wind up the higher probability of a
whole range diseases. You go to NHS. You impose costs
(08:03):
on the NHS. You get these illnesses earlier in life
and bigerous that your imposing costs and the rest of society.
We have a humanitarian society that can't look the other
way and say it was your fault for smoking. We're
going to let you rotch.
Speaker 4 (08:19):
And AND's interesting just to finish your point, press the tickets,
the public. The polling shows people support it. So you
have this kind of expression within Parliament of this very assertive,
aren't they Adrians? These guys are, and if we have
a leadership contest sometime soon.
Speaker 3 (08:33):
They will be a very muscular force within that.
Speaker 5 (08:35):
They would say, we have a freedom to go to
Hell in our own way.
Speaker 2 (08:39):
Yeah, that I'm paying for, but we're paying for that.
Speaker 5 (08:41):
They pay more in TXs because they paid fifty pounds
for packet of cigarettes or whatever it is these days.
Speaker 2 (08:46):
Yeah, but it doesn't make up for what they impose
in others. But the right has claimed the freedom agenda
in the United States. There's something called the Freedom Caucus
and the Republican Party that's trying to restrict government spending.
At the same time they are against abortion. They want
(09:06):
to take away the freedom of a woman to make
their own decisions.
Speaker 5 (09:11):
One thing that we've seen over the last decade is
the American economy. The US economy really surging ahead, and
the EU economy stagnant. And there's a great deal of
US envy. If you look at the number of big
global companies, the big number of big global companies in
the world, the US has increased, the number, the EU
(09:33):
has gone down, China has gone up a bit. If
you look at productivity growth, it's higher in the US
than it is in the EU. The EU is going
through this angst at the moment about stagnation. Americans seem
to be booming, seem to be at least the people
who run the place seem to be quite happy about
the economy. It's partly that that they've had a big stimulus,
but not just that they've had a big stimus. Corporate
(09:55):
America is happier than corporate Europe. Doesn't that slightly square,
it's queer.
Speaker 2 (10:00):
You know, We've been lucky and we've had good policy.
We've had a strong stimulus of the economy under the
Biden administration.
Speaker 5 (10:09):
Under Trump, the economy was growing pretty well before the
COVID disaster.
Speaker 2 (10:13):
Struct that's right. But he also had a big stimulus
from a tax cut, which actually didn't increase investment that much,
but it was a huge amount of money. So the
bang for the buck was very low. But under Biden,
we had the American Recovery Plan that in one year
reduced poverty among children by forty percent. We had the
(10:36):
Chips and sighing sack, the Infrastructure Bill, the IRA which
now is estimated more than a trillion dollars. That's a
lot of stimulus. That's a lot of money put in
a lot of stabies, but nothing in comparison. But let
me just go on. We have a couple other lucky
things and a couple policy things. On the luk side.
(10:57):
We have a lot of natural resources, and part of
our boom is that we've become the largest exporter of
apostile fuels, and in the context of global warming, I'm
not sure that's a great thing, but it is a
big boom to the American economy.
Speaker 1 (11:12):
The professor at Facebook Amazon.
Speaker 2 (11:17):
Based on the Internet and what was the Internet? Who
where does that created government investment? The Internet was created
by the US government. The first browser was created by
the US government. So we created through government funded by taxes,
a the you might say, intellectual infrastructure to the boom
(11:41):
that we are having. You go back to COVID nineteen.
Were we successful in the vaccines partly because the US
government funded some of the basic research that led to
the m RNA platform now one of.
Speaker 5 (11:56):
The Yet you're so good at exploiting these things and
so good at creating companies on the basis of this investment,
which Europe hasn't been able to do.
Speaker 3 (12:06):
You have an.
Speaker 5 (12:06):
Entrepreneurial spirit way of scaling up companies which Europe just
doesn't have.
Speaker 2 (12:12):
I agree, our venture capital firms are very impressive. On
the other hand, part of their success is based on
the fact that we've let our competition lots not keep
up with the times. So these firms have a enormous
amount of market power and are exploiting their market power
(12:36):
in multiple ways.
Speaker 5 (12:38):
I completely agree with that, and I think those companies
are much too big. But I'd rather have a lot
of big companies that I wanted to get smaller than
no big companies around at all. Well, I don't as.
Speaker 2 (12:48):
Think about I think the success of a country should
be measured by the standard of living of the typical citizens,
not Bill Gates or Jeff Bazo's or Elon Musk. And
if you look at how well off, how well the
(13:10):
typical American is doing, not doing that well. Incomes have stagnated.
People at the bottom, and the minimum wakes low has
been for sixty years, sixty five years. That's not as
in many ways a successible economy. Life expectancy in the
United States is lower than in almost any of the
other events countries. The disparities in life expectcy are a greater.
(13:33):
I would not want to be born in the United
States in the bottom.
Speaker 4 (13:38):
So tell us, if you have a second president Trump
and you have these stagnating living standards, where does this
story end, What does it go to?
Speaker 2 (13:45):
Nice it gets worse? You know this is you might say,
the irony that he was elected because many Americans felt
they were left behind, they were not being heard. He
sold himself as the champion of these Americans. You have
(14:07):
to understand, Trump is a con man, exact simple, and
he persuaded them that he would undertake an economic agenda
that would lift them up. So what did he do.
The first thing he tried to do was to take
away what was called Obamacare. It's our weak insurance program
(14:30):
for those in the middle leaving millions of people without
any health insurance. Fortunately, because of one Republican, John McCain,
he failed. Then would he try to do a tax
cut but for whom? For the ordinary Americans? No, for
the billionaires, for the big corporations, actually raising taxes for
(14:52):
a maturity of Americans. So I give them credit for
false advertising.
Speaker 4 (14:58):
Professor Skeats, if he's a con man and he gets
another term, does he get found out or does he
He doesn't, No, he's potentially he's not a command Then
potentially his subsidies and his tariffs on Chinese inputs and
so on, they build up America's industrial rebuilt America's industrial base.
Speaker 3 (15:16):
Create more jobs. Potentially, there is a Trump answer.
Speaker 2 (15:19):
He that's what he tried in his first term and
it was totally unsuccessful. Biden has been much more successful
in restoring our industrial base because he didn't try to
restore the old industries. It wasn't looking in the past.
What Biden said is what are the new industries of
(15:40):
the future, Chips, green economy, green transition, and we have
to be the leader in the new industries. And that's
been remarkably successful. I think at one example was we
thought the take up on some of these green subsidies
would be about two hundred and fifty billion dollars. It
(16:03):
looks now like a trillion dollars that Unfortunately, you might say,
from your point of view, we're stealing some jobs from Europe.
Speaker 1 (16:10):
I mean, the Europeans would say that. But Professor Segletz,
what Donald Trump's China policy, which at the time frankly
seemed crazy, is now mainstream Unfortunately.
Speaker 2 (16:19):
Yes, what I dislike about the China policy is that
Trump sees the world through a lens of zero sum.
If China is doing better, we're doing worse. Economists, I'd say,
since Adam Smith have said there's synergies here, comparative advantage,
(16:40):
Ricardo said that we both can gain from trade if
we manage it in the right way. They're doing better.
Is does not mean we have to do worse.
Speaker 4 (16:52):
But do you really think that's the Biden philosophy right now?
Speaker 2 (16:58):
I think there is mixed feelings in the Biden administration.
The national security establishment, I think is very worried that
China's economic prowess. It sees Americas in many industrial areas,
many areas of high tech and they don't like seeding
(17:21):
that kind of technological power economic power in China.
Speaker 5 (17:25):
Do you think we've reached the end of the age
of neoliberalism and if so, is that a good or
a bad thing?
Speaker 2 (17:30):
I think we have reached the end of the age
of neoliberalism, But like any strong ideology, the death rows
take a long time.
Speaker 5 (17:42):
And what was the essence? What was the essence of
neoliberalism and why was it such a bad thing?
Speaker 2 (17:46):
In your view, it was low taxes and low regulation
would lead to unfettering markets, and that would lead to growth,
and that growth would benefit everybody, what it's called trickle
down economics. And unfortunately what happened is growth was in
(18:07):
the United States, for instance, forty percent blow over the
period nineteen eighty to before the pandemic blow what it
was the previous thirty years. So growth slowed and limited
growth occurred, went overwhelmingly to the buried top. And so
it was the failures that have led to that kind
(18:31):
of disillusionment. Let me make it clear. There were some successes.
It's not like it was utter disaster, but it didn't
achieve what it said it was going to achieve. And
where there were achievements. It was because the government played
an important role.
Speaker 5 (18:51):
The free trade part of that formula was free trade
over sold as a solution to free.
Speaker 2 (18:56):
Trade was over sold. Over sold in two ways. The
magnitude of the benefits were exaggerated. There were benefits, but
the magnitude and the magnitude of the costs, including the
distributive costs, were underestimated. So we've now had in the
(19:18):
United States and very careful studies of the effects of WTO,
of China's succession to the WTO of NAFTA. And if
you look very carefully at the places in the United
States where imports surged because of either of these two agreements,
(19:39):
wages are lower, property values are lower, unemployment is higher.
Speaker 5 (19:44):
And Trump voting is high.
Speaker 1 (19:46):
Professor, So what comes next? Actually, if you look at
the world economy, we're you know, seeing of course on shoring,
we're seeing fighting frankly for ideologies.
Speaker 2 (19:55):
Well, that's part of my book. In this book, I
try to just describe an economic system. I call it
a rejuvenated social democracy progressive capitalism. The name isn't so
important as to say, what are the set of ideas?
And the ideas include a Richard ecology or array of
(20:17):
institutional arrangements, and more role for collective action of many
different forms government and voluntary collective action cooperatives, a whole
set of where.
Speaker 1 (20:29):
In the US, where will we see this first? Everywhere?
Speaker 2 (20:32):
I think Europe is more likely to embrace these ideas
because you're closer to these ideas already and x yu say,
a rejuvenated social democracy. Some countries in Europe are already there.
The National Health Service is viewed as a treasurer of
the UK. The idea of having national health insurance is
(20:54):
still resisted in the United States.
Speaker 1 (20:57):
Professor, it seems like we've lost the ability to talk
to each other right the division. There's just a vision
everywhere and almost every strand of life. And you see
that on campus as a professor at Columbia. How does
that make you feel? What's happening?
Speaker 2 (21:09):
Well, we live in a polarized society, there's no doubt
about it. On campus, we try to have rational discussion.
We try to convey I would say, the basic values
of the Enlightenment. We are an Enlightenment institution and we
strongly endorse those values, and we try to convey to
our students those values. That reason discourse can We may
(21:34):
not agree fully, but we can understand better and we
can reason towards a compromise. But the fact that there
are protests, let me say two or three things about them.
A lot of what is going on is outside our
campus borders. We live in New York City, and we
can control the campus. We can't control what's going on
(21:54):
outside the boundaries of our campus. People feel very strongly
about what is going on, and our students do. And
I feel good that our students are engaged, that our
students have empathy with the tragedies that are going on
in the world. I wanted to make sure they have
a balanced empathy. There are many problems going around the
(22:17):
world that I would like them to get more engaged in.
Protests are important part of youth and it should be
part of our society. They were important part of my life.
In August of nineteen sixty three, I joined the March
on Washington for Racial justice and jobs. There is a
(22:40):
role for peaceful protests in our society and it can't
be an important element of social change.
Speaker 5 (22:47):
But what about the occupation of Hamilton Hall and the
decision to call in the NYPD to remove the occupiers.
Speaker 2 (22:54):
In general, I feel our reluctance to call in police,
particularly for young students. I'm not happy about their having
a police record, and quite honestly, our police are sometimes
a little rough. But I'm not fully apprised of all
of the negotiations that were going on, what damage they
were doing. The presidents that she had no choice, she
(23:17):
didn't want to do it, so I don't want to
second guess the difficult decision that she had to face.
I'm sure she didn't want to call in the police.
It was, from her point of view, something of a
last resort.
Speaker 3 (23:30):
Do you think it will play in the election.
Speaker 2 (23:32):
I think that concerns about how the Middle East is
being handled we'll play in the elections. I hope it
won't overcome the fundamental point that Trump is a con man.
For anybody committed to democracy, anybody committed to social justice,
(23:55):
a reelection of Trump would be a disaster. I really
hope that Americans will will realize that Biden may not
have done everything that they would have liked. In fact politics,
he has multiple constituencies that he's trying to respond to,
and he's making judgments based on what he thinks is
(24:18):
the right thing. So they may disagree with him, but
the consequences of Trump would be such a disaster for
the United States and for the rest of the world
that I hope Americans will make the right decision.
Speaker 3 (24:34):
What's your hunch on the outcome?
Speaker 2 (24:38):
It will I'm optimistic. I think they will make the
right decision where they go into that booth and they
think about what kind of world do I want for
my children and what kind of a world do I
want for the next four years. It's hard for me,
anybody who has faith in the American people to say
they won't choose Joe Biden.
Speaker 1 (25:00):
Thank you so much for joining us. Thank you wonderful,
Thank you. We could have talked to you for another
three hours. Thanks for listening to this week's In the
City from Bloomberg. This episode was produced by Samersadi, additional
editing by Blake Maples, show open design by Moses and
Naan Brendan. Francis Newman is our executive producer. Sage Bauman
(25:21):
is head of podcast. Please subscribe, rate review wherever you
listen to podcasts.
Bloomberg Audio Studios, podcasts, radio news.
Speaker 2 (00:10):
The freedom of one person may come at the expense
of the loss of freedom or the unfreedom of others.
Or is the great Oxford philosopher Isaiah Berlin put its,
freedom for the works is often meant death for the sheep.
Speaker 3 (00:26):
Welcome to the City of London, the City of the City,
of the City of London.
Speaker 1 (00:32):
These mind the gap between the.
Speaker 4 (00:37):
The financial hearts of the country.
Speaker 3 (00:43):
The city, the city.
Speaker 2 (00:45):
Welcome to in the city, and clear of the doors.
Speaker 1 (00:53):
Another week, another look at the conversations motivating policymakers and
financiers around the world.
Speaker 4 (00:58):
I'm Francis Lacqua and alegra Stratton back with you in
the London studio with Fran myself and with Dave out
for one more week. We've brought along some help from
the voter Nomics crew. Welcome opinion columnist Adrian Wildridge.
Speaker 5 (01:11):
Good afternoon.
Speaker 3 (01:13):
He's reading a book while we speak.
Speaker 1 (01:15):
Adrian really a big brain on all things economics, history,
A bit of a historian, Adrian, is how I would describe.
Speaker 5 (01:22):
I know nothing about the economic I know about history.
Oh we're not recording this, we are.
Speaker 3 (01:33):
It's good.
Speaker 1 (01:33):
I think it's great Fred shall run that sorry.
Speaker 2 (01:40):
Is this me?
Speaker 3 (01:40):
Okay?
Speaker 4 (01:41):
You just have from our guests this week, Nobel Prize
winning economist Joe Stiglitz he joins us in the London
Studio for a conversation on his newest book, The Road
to Freedom, Economics and the Good Society.
Speaker 1 (01:52):
Stiglitz served as chair of the White House Council of
Economic Advisors during the Clinton administration. Five years after leaving
the White House Globalization and its Discontents.
Speaker 4 (02:03):
He subsequently wrote several more books hitting topics like the
global financial crisis and inequality. And given the success of
those books and of course the noble, I think it's
fair to say he's a pretty famous economist.
Speaker 1 (02:14):
Hey, fran I would say so. Joseph Stigodz, welcome to
in the City. You wrote a very interesting new book
talking about freedom and economics. And basically the premise of
the book is that maybe we've gone too far in
capitalism and that it's hurt people's freedoms.
Speaker 2 (02:32):
That's right, particularly the form of capitalism called neoliberal capitalism,
which in its very name talked about liberal meant freeing.
It was about getting rid of regulations, lowering taxes, giving
enterprise more freedom to do, but that had the effect
(02:54):
of in many ways taking away other people's freedom. And
an example, freedom to exploit others takes away the freedom
of the exploited. In fact, when the drug company has
raised their prices to skyrocket levels, the right to live
of others is taken away. Freedom to bluet means climate
(03:17):
changes there if you have asthma, you may die. And
other example that we saw very strongly in two thousand
and eight, freedom of the banks to engage in risk
taking and to exploit credit card abusive credit card practices
meant in the end we were all forced to bail
(03:38):
out the banks. We lost our freedom. So one of
the central messages of the book is that the freedom
of one person may come at the expense of the
loss of freedom or the unfreedom of others. Or is
the great Oxford philosopher Isaiah Berlin put its, freedom for
the woofs is often meant death for the ship. And
(04:01):
we've been going through something like that in the United
States and around all the countries, in the bank's countries
where neoliberalism has predominated.
Speaker 5 (04:11):
I wanted to ask you a little bit about Isaaa
Balin and his two concepts of liberty, which is his
inaugural lecture in Oxford in nineteen fifty eight, and he
distinguishes between negative and positive freedom, negative freedom being freedom
from interference or coercion from outside, and positive freedom meaning
freedom to be educated, be well fed, be looked after
(04:34):
by the welfare state.
Speaker 2 (04:35):
I approach the concept of freedom as an economist. I
don't want to pretend that I'm solving all problems, and
for an economists, freedom is about what you can do,
your opportunity set. Somebody at the point of starvation doesn't
really have freedom. He does what he has to do
to survive. Wealthier people have the possibility of making more choices.
(04:59):
So for me, those two ideas are intertwined. When somebody
harms you, it takes away what you can do. If
they harm you by giving you COVID nineteen, you're put
in the hospital, and that takes away your freedom. And
the same way if you don't get an education, if
(05:20):
you don't get healthcare when you're a child, your freedom,
your opportunity set what you can do, is thereby diminished.
So in a sense, I think he has distinction between
positive and negative freedom is a little bit artificial. What
really matters is, in the end the choices that you
(05:42):
can make.
Speaker 5 (05:43):
Now, what are the implications of your more expensive view
of freedom? In terms of public policy.
Speaker 2 (05:49):
It means that we have to be very sensitive to
how one person can harm another, but we also have
to be sensitive to how we electively can do things
that can expand all of our opportunities, expand all of
our freedoms. An example I give is traffic likes. Traffic
(06:12):
likes are a regulation. They seem to be taking away
your freedom. You can go until you get a green,
you are constrained. It a kind of coercion. But think
about life in London or New York and the absence
of traffic likes, you wouldn't be able to move anyway.
There would be gridlock. That little coercion has expanded our
(06:35):
freedom to do. They're an intrusion from government, you might say,
really expands our freedoms collective, our collective freedoms, our individual freedoms.
And that's where Isaiah Blin's distinction between negative positive is
a little bit wrong. There is coersion there. A coersion
(06:55):
can be freeing.
Speaker 3 (06:56):
Professor the state.
Speaker 4 (06:57):
It's kind to ask you how much you're following the
UK because you have these two different concepts of freedom
expressed within the right. So we have inside the Conservative
Party Liz Truss, who spends a lot of her time
in your country on the lecture circuit talking about in
your categorization that kind of old idea that the right
owns this freedom agenda. And then you have Rishie Sunak
(07:18):
who's just put through Parliament a smoking ban. On the
one hand, you've got Liz trust saying I cannot vote
for this, and lots of people by the way supporting
her within that party saying we cannot vote for this
because it is taking away people's ability to choose, their
freedom to choose. And then you have a Prime Minister
of the right who is saying, is it really that
free to be damaging allowing people to damage the health.
So I'm just wondering if it surprises you that you
(07:39):
see this with a within a politician of the right or.
Speaker 2 (07:43):
Not a surprise. There's second hand smoke, and we know
second hand smoke hurts other people's health, So you are
hurting other people's health. And more moreover, if you smoke,
you're going to wind up the higher probability of a
whole range diseases. You go to NHS. You impose costs
(08:03):
on the NHS. You get these illnesses earlier in life
and bigerous that your imposing costs and the rest of society.
We have a humanitarian society that can't look the other
way and say it was your fault for smoking. We're
going to let you rotch.
Speaker 4 (08:19):
And AND's interesting just to finish your point, press the tickets,
the public. The polling shows people support it. So you
have this kind of expression within Parliament of this very assertive,
aren't they Adrians? These guys are, and if we have
a leadership contest sometime soon.
Speaker 3 (08:33):
They will be a very muscular force within that.
Speaker 5 (08:35):
They would say, we have a freedom to go to
Hell in our own way.
Speaker 2 (08:39):
Yeah, that I'm paying for, but we're paying for that.
Speaker 5 (08:41):
They pay more in TXs because they paid fifty pounds
for packet of cigarettes or whatever it is these days.
Speaker 2 (08:46):
Yeah, but it doesn't make up for what they impose
in others. But the right has claimed the freedom agenda
in the United States. There's something called the Freedom Caucus
and the Republican Party that's trying to restrict government spending.
At the same time they are against abortion. They want
(09:06):
to take away the freedom of a woman to make
their own decisions.
Speaker 5 (09:11):
One thing that we've seen over the last decade is
the American economy. The US economy really surging ahead, and
the EU economy stagnant. And there's a great deal of
US envy. If you look at the number of big
global companies, the big number of big global companies in
the world, the US has increased, the number, the EU
(09:33):
has gone down, China has gone up a bit. If
you look at productivity growth, it's higher in the US
than it is in the EU. The EU is going
through this angst at the moment about stagnation. Americans seem
to be booming, seem to be at least the people
who run the place seem to be quite happy about
the economy. It's partly that that they've had a big stimulus,
but not just that they've had a big stimus. Corporate
(09:55):
America is happier than corporate Europe. Doesn't that slightly square,
it's queer.
Speaker 2 (10:00):
You know, We've been lucky and we've had good policy.
We've had a strong stimulus of the economy under the
Biden administration.
Speaker 5 (10:09):
Under Trump, the economy was growing pretty well before the
COVID disaster.
Speaker 2 (10:13):
Struct that's right. But he also had a big stimulus
from a tax cut, which actually didn't increase investment that much,
but it was a huge amount of money. So the
bang for the buck was very low. But under Biden,
we had the American Recovery Plan that in one year
reduced poverty among children by forty percent. We had the
(10:36):
Chips and sighing sack, the Infrastructure Bill, the IRA which
now is estimated more than a trillion dollars. That's a
lot of stimulus. That's a lot of money put in
a lot of stabies, but nothing in comparison. But let
me just go on. We have a couple other lucky
things and a couple policy things. On the luk side.
(10:57):
We have a lot of natural resources, and part of
our boom is that we've become the largest exporter of
apostile fuels, and in the context of global warming, I'm
not sure that's a great thing, but it is a
big boom to the American economy.
Speaker 1 (11:12):
The professor at Facebook Amazon.
Speaker 2 (11:17):
Based on the Internet and what was the Internet? Who
where does that created government investment? The Internet was created
by the US government. The first browser was created by
the US government. So we created through government funded by taxes,
a the you might say, intellectual infrastructure to the boom
(11:41):
that we are having. You go back to COVID nineteen.
Were we successful in the vaccines partly because the US
government funded some of the basic research that led to
the m RNA platform now one of.
Speaker 5 (11:56):
The Yet you're so good at exploiting these things and
so good at creating companies on the basis of this investment,
which Europe hasn't been able to do.
Speaker 3 (12:06):
You have an.
Speaker 5 (12:06):
Entrepreneurial spirit way of scaling up companies which Europe just
doesn't have.
Speaker 2 (12:12):
I agree, our venture capital firms are very impressive. On
the other hand, part of their success is based on
the fact that we've let our competition lots not keep
up with the times. So these firms have a enormous
amount of market power and are exploiting their market power
(12:36):
in multiple ways.
Speaker 5 (12:38):
I completely agree with that, and I think those companies
are much too big. But I'd rather have a lot
of big companies that I wanted to get smaller than
no big companies around at all. Well, I don't as.
Speaker 2 (12:48):
Think about I think the success of a country should
be measured by the standard of living of the typical citizens,
not Bill Gates or Jeff Bazo's or Elon Musk. And
if you look at how well off, how well the
(13:10):
typical American is doing, not doing that well. Incomes have stagnated.
People at the bottom, and the minimum wakes low has
been for sixty years, sixty five years. That's not as
in many ways a successible economy. Life expectancy in the
United States is lower than in almost any of the
other events countries. The disparities in life expectcy are a greater.
(13:33):
I would not want to be born in the United
States in the bottom.
Speaker 4 (13:38):
So tell us, if you have a second president Trump
and you have these stagnating living standards, where does this
story end, What does it go to?
Speaker 2 (13:45):
Nice it gets worse? You know this is you might say,
the irony that he was elected because many Americans felt
they were left behind, they were not being heard. He
sold himself as the champion of these Americans. You have
(14:07):
to understand, Trump is a con man, exact simple, and
he persuaded them that he would undertake an economic agenda
that would lift them up. So what did he do.
The first thing he tried to do was to take
away what was called Obamacare. It's our weak insurance program
(14:30):
for those in the middle leaving millions of people without
any health insurance. Fortunately, because of one Republican, John McCain,
he failed. Then would he try to do a tax
cut but for whom? For the ordinary Americans? No, for
the billionaires, for the big corporations, actually raising taxes for
(14:52):
a maturity of Americans. So I give them credit for
false advertising.
Speaker 4 (14:58):
Professor Skeats, if he's a con man and he gets
another term, does he get found out or does he
He doesn't, No, he's potentially he's not a command Then
potentially his subsidies and his tariffs on Chinese inputs and
so on, they build up America's industrial rebuilt America's industrial base.
Speaker 3 (15:16):
Create more jobs. Potentially, there is a Trump answer.
Speaker 2 (15:19):
He that's what he tried in his first term and
it was totally unsuccessful. Biden has been much more successful
in restoring our industrial base because he didn't try to
restore the old industries. It wasn't looking in the past.
What Biden said is what are the new industries of
(15:40):
the future, Chips, green economy, green transition, and we have
to be the leader in the new industries. And that's
been remarkably successful. I think at one example was we
thought the take up on some of these green subsidies
would be about two hundred and fifty billion dollars. It
(16:03):
looks now like a trillion dollars that Unfortunately, you might say,
from your point of view, we're stealing some jobs from Europe.
Speaker 1 (16:10):
I mean, the Europeans would say that. But Professor Segletz,
what Donald Trump's China policy, which at the time frankly
seemed crazy, is now mainstream Unfortunately.
Speaker 2 (16:19):
Yes, what I dislike about the China policy is that
Trump sees the world through a lens of zero sum.
If China is doing better, we're doing worse. Economists, I'd say,
since Adam Smith have said there's synergies here, comparative advantage,
(16:40):
Ricardo said that we both can gain from trade if
we manage it in the right way. They're doing better.
Is does not mean we have to do worse.
Speaker 4 (16:52):
But do you really think that's the Biden philosophy right now?
Speaker 2 (16:58):
I think there is mixed feelings in the Biden administration.
The national security establishment, I think is very worried that
China's economic prowess. It sees Americas in many industrial areas,
many areas of high tech and they don't like seeding
(17:21):
that kind of technological power economic power in China.
Speaker 5 (17:25):
Do you think we've reached the end of the age
of neoliberalism and if so, is that a good or
a bad thing?
Speaker 2 (17:30):
I think we have reached the end of the age
of neoliberalism, But like any strong ideology, the death rows
take a long time.
Speaker 5 (17:42):
And what was the essence? What was the essence of
neoliberalism and why was it such a bad thing?
Speaker 2 (17:46):
In your view, it was low taxes and low regulation
would lead to unfettering markets, and that would lead to growth,
and that growth would benefit everybody, what it's called trickle
down economics. And unfortunately what happened is growth was in
(18:07):
the United States, for instance, forty percent blow over the
period nineteen eighty to before the pandemic blow what it
was the previous thirty years. So growth slowed and limited
growth occurred, went overwhelmingly to the buried top. And so
it was the failures that have led to that kind
(18:31):
of disillusionment. Let me make it clear. There were some successes.
It's not like it was utter disaster, but it didn't
achieve what it said it was going to achieve. And
where there were achievements. It was because the government played
an important role.
Speaker 5 (18:51):
The free trade part of that formula was free trade
over sold as a solution to free.
Speaker 2 (18:56):
Trade was over sold. Over sold in two ways. The
magnitude of the benefits were exaggerated. There were benefits, but
the magnitude and the magnitude of the costs, including the
distributive costs, were underestimated. So we've now had in the
(19:18):
United States and very careful studies of the effects of WTO,
of China's succession to the WTO of NAFTA. And if
you look very carefully at the places in the United
States where imports surged because of either of these two agreements,
(19:39):
wages are lower, property values are lower, unemployment is higher.
Speaker 5 (19:44):
And Trump voting is high.
Speaker 1 (19:46):
Professor, So what comes next? Actually, if you look at
the world economy, we're you know, seeing of course on shoring,
we're seeing fighting frankly for ideologies.
Speaker 2 (19:55):
Well, that's part of my book. In this book, I
try to just describe an economic system. I call it
a rejuvenated social democracy progressive capitalism. The name isn't so
important as to say, what are the set of ideas?
And the ideas include a Richard ecology or array of
(20:17):
institutional arrangements, and more role for collective action of many
different forms government and voluntary collective action cooperatives, a whole
set of where.
Speaker 1 (20:29):
In the US, where will we see this first? Everywhere?
Speaker 2 (20:32):
I think Europe is more likely to embrace these ideas
because you're closer to these ideas already and x yu say,
a rejuvenated social democracy. Some countries in Europe are already there.
The National Health Service is viewed as a treasurer of
the UK. The idea of having national health insurance is
(20:54):
still resisted in the United States.
Speaker 1 (20:57):
Professor, it seems like we've lost the ability to talk
to each other right the division. There's just a vision
everywhere and almost every strand of life. And you see
that on campus as a professor at Columbia. How does
that make you feel? What's happening?
Speaker 2 (21:09):
Well, we live in a polarized society, there's no doubt
about it. On campus, we try to have rational discussion.
We try to convey I would say, the basic values
of the Enlightenment. We are an Enlightenment institution and we
strongly endorse those values, and we try to convey to
our students those values. That reason discourse can We may
(21:34):
not agree fully, but we can understand better and we
can reason towards a compromise. But the fact that there
are protests, let me say two or three things about them.
A lot of what is going on is outside our
campus borders. We live in New York City, and we
can control the campus. We can't control what's going on
(21:54):
outside the boundaries of our campus. People feel very strongly
about what is going on, and our students do. And
I feel good that our students are engaged, that our
students have empathy with the tragedies that are going on
in the world. I wanted to make sure they have
a balanced empathy. There are many problems going around the
(22:17):
world that I would like them to get more engaged in.
Protests are important part of youth and it should be
part of our society. They were important part of my life.
In August of nineteen sixty three, I joined the March
on Washington for Racial justice and jobs. There is a
(22:40):
role for peaceful protests in our society and it can't
be an important element of social change.
Speaker 5 (22:47):
But what about the occupation of Hamilton Hall and the
decision to call in the NYPD to remove the occupiers.
Speaker 2 (22:54):
In general, I feel our reluctance to call in police,
particularly for young students. I'm not happy about their having
a police record, and quite honestly, our police are sometimes
a little rough. But I'm not fully apprised of all
of the negotiations that were going on, what damage they
were doing. The presidents that she had no choice, she
(23:17):
didn't want to do it, so I don't want to
second guess the difficult decision that she had to face.
I'm sure she didn't want to call in the police.
It was, from her point of view, something of a
last resort.
Speaker 3 (23:30):
Do you think it will play in the election.
Speaker 2 (23:32):
I think that concerns about how the Middle East is
being handled we'll play in the elections. I hope it
won't overcome the fundamental point that Trump is a con man.
For anybody committed to democracy, anybody committed to social justice,
(23:55):
a reelection of Trump would be a disaster. I really
hope that Americans will will realize that Biden may not
have done everything that they would have liked. In fact politics,
he has multiple constituencies that he's trying to respond to,
and he's making judgments based on what he thinks is
(24:18):
the right thing. So they may disagree with him, but
the consequences of Trump would be such a disaster for
the United States and for the rest of the world
that I hope Americans will make the right decision.
Speaker 3 (24:34):
What's your hunch on the outcome?
Speaker 2 (24:38):
It will I'm optimistic. I think they will make the
right decision where they go into that booth and they
think about what kind of world do I want for
my children and what kind of a world do I
want for the next four years. It's hard for me,
anybody who has faith in the American people to say
they won't choose Joe Biden.
Speaker 1 (25:00):
Thank you so much for joining us. Thank you wonderful,
Thank you. We could have talked to you for another
three hours. Thanks for listening to this week's In the
City from Bloomberg. This episode was produced by Samersadi, additional
editing by Blake Maples, show open design by Moses and
Naan Brendan. Francis Newman is our executive producer. Sage Bauman
(25:21):
is head of podcast. Please subscribe, rate review wherever you
listen to podcasts.
Host
Francine Lacqua
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