The Top Political Risks of 2019

The Top Political Risks of 2019

it's the brian mojo on WNYC good morning again everyone coming up later this hour Governor Cuomo will join us on the phone for a few minutes even though we're here live in the green space that one's gonna be on the phone folks we couldn't get him to come down at the last minute from Albany but I think there's a lot to talk about so we'll have a governor on the phone for a little while and we'll have Arturo o Ferrell the great pianist and composer and bandleader he's going to play for us he's going to talk about his amazing project in the Tijuana area called Fandango at the wall which was like 60 musicians playing some of them on either side of the us-mexico border and did that a few months ago but how relevant is that for right now right we had Arturo Farrell already scheduled for today for weeks and weeks and Fandango at the wall couldn't be more relevant unfortunately right at this moment so that's coming up and right now global affairs expert Ian Bremmer with us live in the green space ian has been with us on the show many times he has his own public affairs TV series these days g0 world with the Umbrella on public television Saturday mornings locally on channel 13 g0 is his term for a world with no dominant superpower he is chairman of the erasure group which measures political risks around the world for investors and every January Ian and his team published a list of the biggest political risk that they predict could play out over the coming year last year we began our conversation after President Trump and North Korean president Kim jong-un went back and forth over whose nuclear button was bigger that situation actually seems to be okay for the moment but this year well let's find out hi and welcome back to w NY said it be back with you Brian and by the way listeners when were in the green space you can watch the show as well as listen so if you want to see live streaming video of me with Ian Bremmer right now you can do that on a webpage WNYC org or on our Twitter feed or on the WNYC Facebook page so first to start on the news how are you assessing the government shutdown in terms of economic risks does it register a little bit I think it registers more in terms of the impact of these tens of thousands of folks that are actually getting furloughed the impact on daily lives I mean you know that the global employ unemployment United States right now is at historic lows and in fact the best news last week was that it went up from three point seven to three point nine percent because a lot of people are that coming that were out of the search market are now coming back and and those people are not only getting hired but they're getting retrained and a lot of them are over fifty years old and so frankly I mean this is economically so far this year has been comparatively a good news story but that is not exactly consolation to those people in the US government that aren't gonna see a paycheck tomorrow and of course the stock market has been bouncing around wildly Trump says it's only from the Fed raising interest rates do you see it in more global terms sure I think there's a lot of volatility in the markets because on the one hand global growth is reasonably robust we expect near 4% growth this year as we did last year but people are worried they're worried about a trade war between the US and China I'm not particularly worried about they're also worried about all of these things geopolitically and politically at home and and in the domestic environments of many of our allies that do seem to be coming off the rails I mean if you look at the political environment globally you have to recognize it's not really sustainable and we talk about it as geopolitical climate change it may not be urgent but it's obviously a problem and it's starting to spook the markets a bit you said you don't expect a trade war between the United States and China correct why not well look it very clear first of all the United States markets are down some 10-15 percent from the peak in China it's more like 25 percent neither leader wants to go into second quarter with worse headwinds against them economically so they are incented to get to yes furthermore if anyone that's been watching what Trump has had to say about cheese and paying knowns that he has been consistently positive about the Chinese president he clearly wants to show that China's a tough nut to crack but I President Trump I'm the guy to do it so I would be stunned if on March 1st the deadline that was announced by the US if we were to move towards a 25% tariff across-the-board on Chinese exports I'm pretty convinced that will not happen so that's not a trade war and the markets will respond positively to that but let's be clear compartmentalizing a win between the US and China on trade does not mean that on March 2nd the Chinese stopped stealing American intellectual property does not mean we suddenly don't have a problem with Huawei but the Chinese aren't building an alternative 5g system that they're gonna roll out in 2020 doesn't mean our problems in South China Sea or Taiwan the broader structural relationship between the US and China is actually heading in a more challenging direction it is on your top 10 list of political risks for this year which also includes anti-democracy bad seeds being planted around the world the gloves coming off on cyber war but us-china trade is high on that list us-china relations are higher on that list yes not us trying to trade but the bright look it's the these are the two most important countries in the world that the two largest economies so the fact that that relationship is growing more challenging across the board despite an agreement that will paper it over what we're the agreement that we're gonna see that comes over the next couple of months is like putting some spackle on structural challenges in your house I mean the next time there's a major storm that you're gonna see that nothing was really fixed that's the problem here I will say greenspace audience raise your hand if you have a question for Ian Bremmer but that we will give first priority to a certain segment of our green space audience today if they happen – have any questions we have a global affairs class from Morristown beard High School here and not to put you on the spot you will not be graded on this at least not by me but if any of you from Mars town beard has a question for Ian Bremmer do we have one already we'll give you guys first priority and let's take one right now hi there hi first I'm really excited to be here thank you for taking my question and basically fer is is the concerns over a No Deal brexit is that somewhere on your list I'm more concerned about especially if they fall they fall out of the EU what kind of America's reaction to that will be how will that affect the market how about it will that I mean obviously the markets will probably not react favorably to that but more specifically what industries might what companies might fall look the Brits have already lost about 15,000 jobs in the financial industry since the brexit referendum vote occurred two and a half years ago that's not a disaster for the British economy but it's not good there's a recent survey in the last week that says about a trillion in assets money managers and other financial institutions say they'll move out because of brexit that's more significant but we don't have an outcome yet and although a No Deal brexit where they're left in the cold and just have the World Trade Organization is increasingly possible it's also increasingly possible that we have a second referendum and if that were to happen the Brits would likely vote to stay in and so we can pretend that the last two and a half years were just the most extraordinary own-goal that we've ever seen in a major advance the gospel democracy that frankly looks that makes the United States look almost functional from a political perspective and we should all appreciate that it it is it it is on the list but the funny thing is for the first time since I started the firm 21 years ago it's not ranked as one of the top ten risks it's instead an asterisk and it's a it and it's because we're being honest that we don't know and in fact we're saying something strong in that we're saying that anyone that tells you they know is lying to you including the British Prime Minister it really could go with any directions we like it let's take another question here in the green space hi I need to ask you a question today so one of the risks you talked about was national international security and stability so my question is what do you see is the greatest technological risk to international stability within the next ten or so years when we go out the next ten years I think the big problem is that we're moving from a global system where everyone was aligned with one set of technological standards to a global system that will be split in two when you talk about artificial intelligence there are big companies in the United States that are driving deep learning and driving how we assess big data driving surveillance all of that it's Google and it's Amazon it's Facebook and it's Microsoft and in China they're completely different companies its Alibaba and its Tencent and and and the fact is that those companies increasingly are not working with each other one of the reasons I'm optimistic about us-china trade especially in the near term is that we need each other it's that American companies are manufacturing in China and they're exporting those products to the United States and the Chinese want to send a lot of goods to the Americans and we want to buy a lot of cheap goods from China that's just the reality even though it displaces some workers but and I'm not saying that doesn't matter but the fact is that we need each other where when you look at the developments in technology in the next ten years we're moving into a system where we don't need each other where it feels more like an arms race and if if right now it already means that Chinese investments Silicon Valley is way off and increasingly American tech investment China's going down soon I think you'll move to a situation where Chinese students increasingly aren't studying in those fields in the United States a whole new generation that's obviously a major danger in the way we think about the world and the world economy what about the one on your list that is taking the gloves off regarding cyber war what does that refer to yeah it clearly cyber attacks are getting worse and you know you you would have been worried about that irrespective of anything specific to 2019 but in 2019 two additional things are happening first let's remember that when the Russians hit the American elections under Obama Obama was very aware of what happened but didn't really want to respond very hard because he was concerned about escalation the Trump administration has decided they really want to try to push harder on cyber deterrence and they are moving towards allowing cyber command in the Department of Defense to engage in preemptive strikes against would be adversaries on cyber I think the potential that creates an escalatory cycle is real I also think we have to recognize that as the Muller investigations come to fruition as well as the investigations here in the Southern District of New York we're gonna have a lot of information about people that are very close to Putin his inner circle that have been working with Americans and trying to go after our democracy and when that happens Congress is gonna hit the Russians back and when that happens the Russians are gonna be angry the Russians have the greatest capacity on cyber to hit us and they're also the least risk-averse so clearly 2019 if you were to tell me I don't think we're heading for war I don't think we're heading for any major sudden crisis this year but if I were to wake up and you were to tell me Ian oh my god you won't believe we are in serious trouble my guess would be that is a Russian attack on cyber that hit our critical infrastructure that would be the single thing I'd be most worried about huh and what about impeachment in terms of global implications in plication Ziff that were to come about and of course remember Hillary Clinton wouldn't become president Mike Pence would become president but what do you see as the biggest global implications if that were to happen uh well I mean honestly I think the likelihood of not just impeachment in the house which could easily happen but for to be confirmed in the Senate that's controlled by the Republicans I think is an extremely low likelihood it's not on the list but the United States at home as you imply is on the list and it wasn't last year you and I talked about this in January and I said red herring you know Trump's gonna tweet a lot he's gonna say a lot of crazy things but actually there's no real risk to American institutions at home and that indeed was the case in 2018 two years in American institutions have stood up quite well despite everything Trump's had to say 2019 I'd like to be able to say that's still true it's harder to we have to admit that American political institutions this year will be tested in ways that have not occurred in our lifetimes that as these investigations go after Trump's family his wealth and his person the three things he cares most about right he's gonna react he's gonna hit back and he's everything we know about Trump is when he hits back he's not necessarily constrained by what previous presidents have done and that's gonna test it's gonna test the media it's gonna test Congress and perhaps most importantly it's gonna test our judiciary now I believe that when that happens our institutions will stand up to it but I can't tell you sitting here in front of you today that I feel 100% confident that and it's a consequence of that the United States domestically is actually a risk I think we could see some permanent erosion to our institutions as a consequence of that we just haven't met it left let's use it to take one more question from our Mars town beard High School Global Affairs class group hi there hi do you think that it's possible that in the coming years companies such as Google and Facebook could be broken up by antitrust laws and if so what impacts would that have on the global economy I have a hard time imagining that they would be broken up with existing anti-trust laws but I think we have to recognize that there is a backlash a tech lash against these companies and and what their business models represent for liberal democracy in terms of their treatment of bots for example in the way that algorithms are treating us as products is a problem the Europeans are way in front of this compared to the Americans they are a regulatory superpower in terms of their common market and they're bureaucrats are really good at this anyone that saw Zuckerberg and Congress recognizes that our Senators and Representatives don't really understand things like the Facebook as well but no this is a problem but I have to tell you if you only see it in terms of Big Bad American monopolies you're only seeing half of the story I recognize that these companies are promoting addictive behavior and they are bad for us as citizens and clearly bad for our kids and yet if I look at the fact that the Chinese have monopolies in these same fields that they are supporting and promoting from a Chinese perspective I as an American will say wait a second I need to make sure that these companies are actually robust and can promote the American national interest and how you square those competing interests is one of the most challenging problems that are in front of our government officials going forward I wish I said I could tell you I had a good answer for you please thank in Bremer chairman of the eraser group which measures political risks around the world for investors in every January he releases his forecast of political risks for that year thank you for coming on for I think it's about the 10th January in a row he in fact is a solid decade thank you right right in their ability to NYC Governor Cuomo with us right after this

10 thoughts on “The Top Political Risks of 2019

  1. Ahaha you dumb fuck, once again a failed prognosis. This just in, the Muler investigation is over and there was no collusion. Why do I bother listening to this idiot. I might as well go check with George Friedman. No wait, he is also failed on every prediction. With "experts" like these, the Chinese will walk all over you.

  2. Holy shit…. Ian Bremer is a "muh russia"/"muh meuler probe" conspiracy theory believer….. that is definitely a huge credibility hit if he believes that. Jimmy Dore has torn that shit down, and so have a bunch of people that actually called the election before it happened. I guess when you live in the swamp, it would be ridiculous to believe your gonna come out completely clean.

  3. Marco Rubio had yet another water bottle event. he said 'if a Dem president used the emergency thing he could seize fossil fuel companies'. well, John Kerry can switch between "migrants" and "Climate refugees" in the same sentence. quite recently over and over again. but for several reasons a GOP person cannot 'link' those two things. Kerry was talking about Syria and Afrikee where grits cook different than they do in Mexico. also, Kerry is with the political party that is the Good Cops on Global Warming. but Rubio did what no GOP person can possibly do. that Nancy Pelosi knows for sure they can't do at all but Rubio did anyways! he linked 'Climate' with the Shutdown. dude! if we had broken a threshold in the last few weeks we wouldn't seize 'fossil fuel companies' such as hotels and golf resorts… if it were a Climate thing at all we would………… build a better border wall. duh.

  4. When they are in the economical and political decline they become fragile, frustrated and very sensitive, they lost their confidence and they have no more sense of humour. When they have problem they always say all are the Chinese, Russian or other country's fault. When they steal (based on Snowden) they think everyone else is the thief or spy. When they have very bad track records (they have declared so many wars with so much bloody killings since WWII) they condemn others about "human right violations", and so on. When their media, their government and their markets have been controlled by the interest groups they endlessly remind other countries to follow the rules of "free speech", "democracy" and "free market". When they consume so much cheaper "Made in China" in their daily life and their country borrowed so much money from China they say China is just a copy-cat and would collapse soon … without any appreciation, funny, isn't it? Actually, the biggest American threat or enemy is American itself, neither China, nor Russia or other countries. No matter how correct, great and glorious you would be before, you could fail unless you continue to reform or modify yourself.

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