The Heat: One-on-one with Jeffrey Sachs

[Music] world-renowned Economist Professor author and Global analyst Jeffrey saaks joins me one-on-one to discuss some of the world's major issues hello I'm arnand naido and this is the Heat [Music] with so many big stories making news across the world it is my pleasure to be joined by the acclaimed Economist and Global analyst Jeffrey saaks for his insight and perspective we will discuss China its economy and beijing's relations with Washington I will also get his views on the Trump presidency efforts to end the Russia Ukraine conflict and the ongoing crisis in Gaza Jeffrey saaks is director

of the Center for sustainable development at Columbia University he's also president of the UN sustainable development Solutions Network and has served as a special advisor to three un secretaries General Jeffrey welcome to the show great to be with you thank you so much well as I said the world is beset uh by many conflicts right now we see the conflict in Ukraine we see what is going on in Gaza we have traditional alliances that are fraying right now we see protectionist barriers going up tariffs being introduced there have been retaliations it's placing heavy burdens on

the global economy before we get into some specifics uh how would you describe these extraordinary times and are we at some sort of inflection point right now we are certainly at an inflection point uh we are in a new multipolar world actually we've been in a multi-polar world for quite a while but the United States hasn't recognized it so many of the crises that you mentioned the Ukraine war the ongoing wars in the Middle East the tensions between the US and China in my opinion uh have resulted from the failure of the US leadership for

many years to understand multipolarity the US idea dating back at least to 1991 arguably dating back to 1945 in some sense back to the founding of the United States is that the US is exceptional and at least since 1991 that the US runs the show this is not a very realistic view of the world uh the US leadership doesn't understand China the US leadership greatly underestimated Russia the United States does not understand its isolation Visa the Middle East and the conflict between Israel and Palestine the United States still to this moment doesn't understand the Global

Environmental crisis or doesn't want to understand it and so a lot of the problems sad to say uh emerge from one very powerful country the United States which has greatly overestimated its power and greatly underappreciated the importance of diplomacy to address Global issues thinking that somehow go It Alone is the right strategy it's not and it's led to a Cascade of Crisis well let's talk about that relationship that between the uh United States and China it's often been described as the world's most important bilateral relationship as the uh very important two sessions meetings which were

watched by the world taking place in Beijing foreign minister Wong Yi reiterated China's support for multilateralism and for relations between the US and China to be based uh on Mutual respect on cooperation it's it's a contrast to the way Donald Trump sees things he talks about America First he's putting up protectionist barriers how do you assess the relationship right now and where it goes to from here it's a little bit complicated America First doesn't quite mean what America has pursued since 1992 which is American dominance uh the phrase America first uh means primarily uh American

self-interest okay that's H one version but American Primacy has been the dominant foreign policy since the end of the Soviet Union meaning the belief by the American leadership that the US dominates the world and sets the rules of the game of course this is delusional idea China is very big very powerful doesn't want to have the United States set the rules wants a multilateral system in which the rules are set cooperatively and in mutual respect for a long time the United States thought well China's a a subsidiary uh it to us uh China will be

helpful in our confrontation with the Soviet Union or with Russia but it's not a a competitor and then it suddenly dawned on the United States leaders sometime around 2010 whoa look at China's success look at its scale look at its technological uh Innovations look at its industrial power and the United States quickly swung from a kind of complacence to a kind of panic about China and the Panic was we're number one but China's a threat to our Primacy and so immediately rough roughly around 2014 America swung to a a kind of quote unquote containment strategy

we have to limit China's rise we have to prevent uh China from threatening American Primacy I would say this was also wrongheaded and delusional China's rise is not a threat to the United States and at least as I as an economist think about it there's no ranking one two three the question is human well-being an advancement of China advancement of the United States and China's rise in my view is not in any way a threat to the United States because we're not in a zero sum game well that's not the way the American strategists have

thought about it and for the last 10 years they've been trying to think about ways to limit China's growth what they came up with already starting a decade ago was to try to create alternative trading systems in which China would be excluded to put on barriers to uh trade with China to add in uh tariffs against China to put on bans of exports of technology that would hinder China this is a Playbook that was actually spelled out about 10 years ago it's a very regrettable Playbook it's a very naive Playbook the United States cannot quote

contain China uh it's not doing so it's not succeeding but it does raise a lot of tensions and moreover it creates problems for China not fundamental problems but the US market was very important for China's growth the US market is increasingly closed to Chinese exports Chinese exports are down from their Peak several years ago by 25% or so in dollar terms that's that's a lot it's not going to crush China China will reorient its trade to other markets but it's a it's a hindrance it's a nuisance uh it's unnecessarily hostile it's costly by the way

to the United States this is not a zero sum game uh this is a net net loss when the US becomes protectionist but that is likely to be the continued approach of the Trump administration at least for a while at the uh two sessions meetings in Beijing we heard from uh the premier uh in his government work report and China has set a GP GDP Target of around 5% for 2025 and as you point out China has made significant progress in technology especially in things like artificial intelligence uh in robotics as well as in electric

vehicles it's now the biggest exporter of electric vehicles it is also stering away from its dependence on exports and focusing on domestic consumption what does this tell you about China's continued growth and how that in turn will drop Drive Global growth First China can achieve 5% growth for the coming years China has a lot of goods a lot of services that the emerging and developing economies urgently need zero carbon energy sources fast rail in some cases fourth generation nuclear power longdistance power transmission electric vehicles of 5.5 5G Data Systems artificial intelligence with deep seek and

others China's at The Cutting Edge of the green and digital Technologies of the future it ought to be exporting those Technologies I wish the United States Market would stay open I wish we would be competing not protectionist but uh China should be exporting those critical digital and green technologies to the rest of the world not letting the United States uh stop China's export-led growth because that should continue merely going to consumption means unnecessarily slowing growth and unnecessarily depriving the world of the benefits of Chinese technology and and Chinese Investments so I would like to see

an expanded belt and Road program for example in which China is helping developing countries to finance essentially the importation of all of this Advanced infrastructure which would build those partner economies and then those partner economies would repay the financing through their own rapid economic growth in the in the coming years in other words I'm not convinced that the fundamental idea is to shift from exports to consumption that's a that's a kind of that's an American approach we're very good at consumption not so good at investment and and exports I'd like to see China continue its

success story uh with the rapid growth of exports but helping the emerging and developing economies and recognizing the American economy is going to be pretty protectionist for a while right you mentioned the uh belt and Road initiative uh that is now just over 10 years old um what do you make of the progress that's been made so far with this in initiative I think it's a phenomenally positive and important initiative that's one of the reasons I can say only semi factiously that the United States badmouths it all the time because it's very good and very

important uh it's helping to finance the infrastructure and the connectivity of the world economy and it is a source of exports by China to the rest of the world a source of loans and now increasingly Equity Capital meaning foreign direct investment by Chinese companies that are producing in partner countries as well now it's created a so-called uh uh challenge of debt repayments by recipient countries and that uh has been called a debt Trap by the United States and so forth this is not at all true the main point is China should be providing financing to

the emerging economies they can repay these loans the only change I would make in the belon road program in addition to expanding it would be to lengthen the maturity of the loans that are given from roughly 10year Finance to 20 or 25e Finance because developing countries need 20 or 25 years to reap the benefits in terms of increased output that then repays the loans but aside from that footnote of a lengthening maturity expand Bri this is the way that the whole world gets interconnected with Advanced 21st century green and digital Technologies I want to turn

now to what is going on in the United States uh president Trump of course took office uh a few weeks ago he's instituting significant changes domestically uh as well as in foreign policy domestically we see these cuts to the federal Workforce we see the Crackdown on illegal immigration and then of course in terms of uh foreign policy we see the imposition of tariffs additional tariffs on China and now we see tariffs being imposed on the neighboring countries Mexico as well as Canada and the Democrats are struggling to find a response to all of this what

is your view of these first few weeks of the Trump Administration well I think that there's one good sign which is that Trump is aiming to bring an end to the war in Ukraine which is a useless war that should have a long time ago that's very positive on the economic side I'm underwhelmed if I could put it that way it's it's a lot of chaos uh our financial situation in the United States is not good the budget deficit is around 7% of GDP but as is a bad habit of us Politics the politicians want

to cut taxes even though there's a a huge budget deficit uh in other words the United States is fiscally irresponsible and Trump is uh you know proposing he says cuts and spending but these cuts and spending either will be uh very small or will be made on the most vulnerable Americans basic access to health care and so forth which would be devastating and why to give tax cuts to the richest Americans so I'm really not impressed by the fiscal framework that Trump is proposing the Tariff barriers seem to me to be uh utterly self-defeating they'll

just make the United States economy uncompetitive while annoying the rest of the world not crippling the rest of the world because the US is just not a big enough market to determine the fate of the world economy but it is big enough to annoy the rest of the world and that's what these tariffs are going to do they will not lead to any kind of recovery of the United States of its manufacturing and so forth because after all the basis of an economy uh and its competitiveness is its Innovation the quality of Education the quality

of the skills of the the workforce uh the scientific and technological advancement uh it's not based on tariffs uh and so Trump has the wrong model for how to uh address add America's many economic ills which include by the way basically two societies one doing okay if you have an advanced degree if you have high skills and one really suffering a a lot because uh uh incomes are stagnant uh and jobs are being lost to Robotics and artificial intelligence and Trump does not have a structural answer at all to what what ails the US economy

all right you mentioned the Russia Ukraine conflict uh and the search for a peace deal the effort that's being made by the Trump Administration while that recent overal office meeting between President Trump as well as vice president Vance and the Ukrainian president zinski did not go well and I'm being charitable about that um but do you see an end to the conflict soon what's it going to take I do see an end to the conflict because the conflict depends on financing and uh arming of Ukraine by the United States in other words this is a

proxy war of the United States uh fighting Russia it's doing it by hundreds of thousands of ukrainians being killed it's a it's a terrible War but it from the US point of view it is was kind of a game uh sad to say the game was expand NATO to surround Russia well anyone's sensible and there were many sensible American diplomats knew that this was a provocative and dangerous approach but believe me the the American leaders have been arrogant and ignorant for 30 years and they kept saying we don't have to listen to Russia we can

do what we want NATO can go where it wants we ended up with the Ukraine war Trump is uh to his uh wisdom on this trying to end it he doesn't want to hold a losing hand he knows that this war is long lost on the battlefield destroying Ukraine and completely unnecessary because it was based on the whole idea that the United States would push NATO to Ukraine and to Georgia surround Russia in the Black Sea and that Russia couldn't do anything about it but Russia said no we're not accepting that that's why we have

this War I think Trump is going to end it because frankly uh Americans don't like this war don't want to pay for it uh Trump doesn't want to hold a losing hand and the Europeans who are very warmongering these days cannot substitute for us finance and US Armament so the war is going to end soon and if we look at Ukraine's point of view I mean uh you know I want to reference that bruising encounter in the obal office again uh what president zalinski said is that Ukraine wants peace but it wants security guarantees before

a ceasefire leading to what would be a comprehensive and just agreement is that not a reasonable request well there was an agreement on the table April 15 2022 which people can find online which was essentially a way to end the war uh and it was with security arrangements for Ukraine it was with some territorial uh concessions or adjustments for example Crimea is no way going back uh to Ukraine because of Russian security needs and at this point after several years of War uh parts of Eastern and Southern Ukraine are not going back but the framework

of the agreement was already there April 15 2022 the United States and UK told the ukrainians on that date don't sign fight on and probably a million ukrainians since then have been killed or Gravely wounded because of that stupid advice from the US but the purpose for the US was actually to have Ukraine fight they thought Russia would back down they thought Russia would lose they thought that American sanctions would kill the Russian economy all very very bad miscalculations by the Biden Administration Trump has a more accurate understanding that the war has to end on

that basis so yes of course there can be security guarantees but zalinsky has to negotiate he says I'm not giving any territory well okay good luck the US isn't going to fund this war and you Mr zalinski you are ruling by martial law your own people want peace right now they want peace even with territorial adjustments that's what the opinion surveys show but we have a you know a president who rules by martial law maybe for his own personal reasons he doesn't want to make any uh peace deal but the fact of the the matter

is the Ukrainian people want a peace deal right there is something else as well I mean there are many people who feel that President Trump is aligning more with the Russian President Putin rather than with Ukraine or with European allies and this is putting a strain on the transatlantic uh Alliance uh what advice would you have for the Europeans and what role they could play in bringing peace to Ukraine well I don't see it that way I think Trump is actually saving Ukraine not harming Ukraine because continuation of the war is not saving Ukraine that's

that's the basic reality if if Ukraine were going to win the war and no way that can happen uh then it would be a different matter if Ukraine were actually somehow with NATO winning the war there would be terribly dangerous escalation on the Russian side for Russia this is existential so I don't believe in any way this narrative or rhetoric that Trump is against Ukraine I think he's actually saving Ukraine but when it comes to the European side I wish the Europeans would understand the 30-year background to all of this better than they at least

profess to do right now uh the European narrative if I could put it that way is that the War Began on February 24th 2022 that's absurd uh the War Began with NATO enlargement The War Began uh uh intensified with the US participation in a coup that overthrew a neutralist Ukrainian president yanukovich on February 22nd 2014 the war escalated further when the United States in Ukraine failed to implement the Minsk agreements and on and on yeah so the Europeans need to get their they they need to understand little bit of history now what should they do

they should open up their own security negotiations with Russia stop the russophobia and negotiate directly with Russia this is very clear I want to move now to the other big crisis that uh is uh preoccupying the world and that is what is taking place in Gaza what the United Nations has called plausibly genocide uh we've seen 48,000 people who've been killed there tens of thousands of others who have been wounded and the territory has been wholly demolished um what is your view of what is going on there and the US continuing to support Israel financially

militarily diplomatically what's going on is essentially A Hundred Years War uh how will two groups uh the uh Israeli Jewish State as they call it and Palestine live together what the Israeli government says very explicitly is there will be one country that's Israel dominated by uh um it will be a Jewish State and it will rule over the Palestinian people there are roughly 8 million Jews in Israel and 8 million Palestinian Arabs and uh Israel which has what I regard as an extremist Government after all its prime minister has an arrest warrant on him by

the international criminal court and his government as you say is in the dock at the international court of justice for the crime of genocide so I regarded as a very extremist government that extremist government says one state ours never a state of Palestine but the only way to peace is what we call the two-state solution there needs to be a Palestinian State for the Palestinian people there needs to be state for Jewish State for the Israelis this is obvious this has been what international law and un Security Council resolutions and UN General Assembly resolutions have

said for decades this is the this is the opinion of the vast majority of humanity but the Israeli government has opposed it and the United States government has backed Israel and Israel's approach is you don't like it we'll go to war with you and so there are Wars all over the Middle East but who actually uh arms these wars and pays for them it's the United States so my view is the United States needs to understand what an American based foreign policy is and that is two states and then there's peace I want to conclude

now with the one other issue Big Challenge uh for the world and that is the climate crisis the last climate conference had some distressing news for us experts told us that we have actually reached the point of no return as far as the rate of the temperature increase uh across the world uh we have President Trump who's withdrawn again from the Paris Accord uh what is the impact of all of this we reached 1.5 degrees Celsius warming compared to the pre-industrial level in other words Earth is already warmed by more than we committed to stop

in the Paris agreement uh that was reached in December 2015 we've already broken the limit that we set at that agreement the 1.5° C and the warming as you rightly note has accelerated to probably more than 0.3 Dees C Each decade we're in an extremely dangerous situation Trump is uh so irresponsible on this one doesn't know where to start fortunately American states uh continue to move towards zero carbon Energy Systems China has an huge role in the world to play because China is the lowcost provider of just about every technology we need to uh end

this huge huge crisis China's the lowcost provider of electric vehicles of batteries of solar power of wind turbines of fourth generation nuclear uh of battery supply chains uh of uh hydrogen economy so China has this mass production at low cost of all the key Technologies that's one of the reasons I say expand the belt and Road initiative because that's the green digital transformation that the world needs I would like China to accelerate its own transformation China is by far uh installing the most zeroc carbon power capacity of any country in the world I want go

even faster CU it's so good I'd like it to reach Net Zero by 2050 rather than 2060 and through BR and other programs to help the the rest of the world do that now the United States is it's going to squander uh some time again it's going to lose its Global competitiveness in these key Industries but the United States is actually going to have to turn around and decarbonize as well as the rest of the world Jeffrey than thanks so much for being with us my pleasure thank you and we need to leave it there

thanks for watching another edition of The Heat [Music] [Music]