Choice frankly when they started printing money it was an unprecedented policy approach but they felt they were facing unprecedented times jim should we be worried about debt the new thinking it seems among more than Monetary Policy advocates is the debt no longer matters who are struggling we had our debt and deficit. Before the election the elections over its sort of gone on why are very low in any case so i think. Provided youve got. An export process as i cry. In the last issue the last question where we talked about brazil and china with a strong brazil we have. Help with strong Commodity Prices so you know stride is had a morning boom with exports to china or brazil which had a dawning boom would saw your bones and so on so i think if youre a situation where your commodity. I mean you can make your interest free permits i dont think that is as much an issue as we thought weve sort of gone away from a debt and deficit fetish in a straw idea because its been saying its more political scare campaign than anything of grounded in an economic theory. Does debt matter i mean i guess it does for argentina still under its i. M. F. Program what is the state of argentinas economy right now. Well i was i was listening you know to the to the other answers and thinking well if you print money for long enough then you push it into so many electoral cycles then it becomes a structural problem so youre talking about you know that a Monetary Policy no matter what stage you are within a government so i mean of course that matters to argentina and the key question right now is whether the next administration whoever it may be you know will be able to repay dead or needs to restructure the payments schedule with the i. M. F. You know its unrealistic for argentina to face its that payments in 20202021 so the question is whos sitting at them the other side of the of the negotiating table from the i. M. F. You know will it be precedent mockery in a 2nd administration or with will it be about the fernandes and Christina Pearson or so you know of course in terms of where the economy is i would say its in the intensive care unit its currently stable but our prognosis is reserved and it really depends on how the Political Uncertainty of this Election Year pans out and what the actual policy proposals are from whoever takes government on the summer tends to where a lot of people saying this year that capitalism has failed is failing now is it time that perhaps we should look at doing things a little differently ross to get about that with his point you know with that dive bar from argentina you know you have an economy like argentina with great Natural Resources and Human Capital it really should be like a straw youre in and so should brazil given the resource and a mentor or i think the big mistake with my idea is that as we have opened up our economies weve forgotten about the libre market and social protection in a struggle we had a social democratic government led by the light bob hawke who are opened up the economy ridge. Tariffs my the struggling economy very open and competitive but he did so with very strong scifi nets in terms of a wide accord with the tried unions and pension superannuation and universal health care and i think if you dont look after your social safety net as you open your economy you do end up with an economic populism approach and i think the reason the president was popular wasnt that tried was damaging the American Economy it was a fact that the minimum why should being frozen and that the United States of being do unionized i think youve if you look after you like the market institutions at home then i think youre more likely to get a more successful competitive economy. I see you nodding is it time that we do things a little differently is capitalism dead. I dont think capitalism is dead i think none of the systems are perfect they all have flaws but taken to an extreme none of them work very well communism taken to an extreme was a disaster i think up it wasnt taken to an extreme clearly its flaws are evident theres a huge inequality of wealth i think in the United States the top 0 point one percent of the population has the same wealth as the bottom 90 its an extraordinary statistic. That level of inequality is just a function of continued the success of capitalism so there has to be some checks and balances probably so that you do not end up with reactions where the vast majority of your population is not benefiting from Economic Growth and its going to a smaller and smaller proportion of people who act interestingly enough. Less and less tax because theyre rich enough to avoid tax someone who is doing things differently is mexicos you president him in a fight him really frustrating hes giving up his private jet his personal security guards hes opened up the president ial palace he drives around in a v. W. He didnt go to the g. 20 what are we to make of him and his his leadership style is this all i dont know a p. R. Stunt is there any substance to this well i think theres a degree of substance but then theres also a degree of continuity with the you know political culture of the left in the pink tide i think you know in some in some ways you can argue mexico arrived to the party a few years too late. In terms of the type of leadership that lois is seeking and what we saw earlier with more in europe why for example and and i think you know with saving the distance of the size of the 2 economies you can compare them in terms of their style the key the key risk we see with mexico is the like of certainty in terms of policy. And the lack of clarity in terms of how different policies were together so for example. And we you know when we look at the number of announcements that the press and make here in the campaign and as heated government in terms of social spending you know a lot of the policies have worked in other countries but the key question is how can you afford those policies sustainable sustainably over a 6 year period without increasing your debt your your debt to g. D. P. Ratio and when you have you know major questions about the sustainability of your Largest Company pemex when youre being downgraded and so the the main problem is not necessarily what im alone is proposing to do but actually we are uncertain about how hes going to finance those proposals and thats where the issue of sustainability and comparing to you know populism a will happen in in argentina and in brazil you know in the last decade comes into play because you know you dont want to be looking at a mexico 10 years down the line that is struggling with you know how your levels of debt inflation you know money printing as a way of financing those social pro programs and saving mexico is one where its still got a positive outlook for 2019 but we have to watch it but what are your thoughts on on mexico it has this this enviable position with a massive market to the north its a Manufacturing Base for u. S. Companies huge oil reserves its part of the g 20 and yet it still has difficulty translating all of that into into a deposit a reduction. I think youre right i mean archie think you know the president. Should use tried in investment to grow the economy and to be able to have therefore the resources to provide for the poor or i think abolishing pro mexico not going to the g. 20 i think ultimately that undermines mexicos position and capacity to help the poorest of the poor just in mexico as part of the 6 party people economists. Series actually for a strike in television and what i noticed is that mexico has very good free tried logistics and transport links with the eyes of pacific and with the Pacific Alliance with chile and colombia and peru had a lot of things going for it not just the the border no i think the the overwhelming Media Attention on. Immigration with the United States and the crime problems along the border actually undermines the very strong fundamentals of mexican industry a lot of the love the mexican manufacturers have very strong links with the state of victoria here in australia so i think theres actually a good story for mexico but i actually think they should use try to innovate spent the Transpacific Partnership the g. 20 to drive better growth so they can pay their their social programs that are important to the left and important for social stability ok were heading towards the end of the program just some final thoughts before we do conclude. His forthcoming elections what are your thoughts the race is pretty tight. Yeah the price is that the race is extremely tight we see it as a 2. 00 horse race the polls are showing that you know mike crist benefiting from a Stable Exchange rate with the dollar inflation is coming down its still very high by International Standards but its still good news salary cells that are still below inflation so theyre not catching up but the purchasing power is recovering from what was a very very volatile 2018 with a major devaluation of the past so so you know and lest we see some some extreme changes between now and october i would expect 2 for there to be a 2nd round runoff to decide who will be the next president and as we get closer to the election if the economy remains stable i think its still precedent mccree who has the upper hand as the incumbent to get reelected and our final thoughts on turkey is that as the biggest regional economy. And and the region as a whole how will. We know with the Saudi Arabian economy in particular slowing. So that the gulf region and turkey i think the similarities if you like that they have is that they dont ask economies are hurting for for perhaps differing reasons but theyre hurting but whats bailing them all out at a time when its. Governments are finding it difficult to balance their budgets and theyre having to to to be more conservative about spending is the we were talking about fed policy and Interest Rates as u. S. Interest rates come down. Global investors go elsewhere and look for yield and look for returns and one of the things that the gulf and he has benefited from very significantly in the last couple of years is that their cost of borrowing keeps falling more and more which makes it easier and cheaper and more fordable to be able to finance their deficits at a time when theyre going to be struggling so if wed had the same Economic Situation in turkey in this region when Interest Rates were 5 or 6 percent higher that would have been a very different situation so they are being bailed out by what looks to be lower for longer if you like the global Interest Rates they are obviously measures in place across the region to try and improve the domestic situation but governments are constrained because theyre not necessarily able to. Get as much income as they would like because the Global Economy is slowing and the out the the demand for that output whether it be oil or the goods that he produces is softening and is the u. S. China trade war going to be resolved anytime soon is china going to have to stipulate to to to save its economy or sit out of the china cat on the side what used to you know when i 1st went to china 20 years ago i said you know do you have Workers Compensation in china in the factory manager would solve the neither the Workers Party thing that i have to compensate us you know when i had a huge reserve army of leibert never got live or shortages and thought like the markets and wall of china so they wont be able to stimulate the economy in the sign why i think the whole worlds going to. Suffer in some wise from the incapacity of stimulus in the same way that it worked during the Global Financial crisis and in 2000 and i dont think thats why theres been pressure on Central Banks to. Rights but now theres only so much like and over there sort of if you like pushing on a string. And that we must end our discussion its been great to have you with us many thanks indeed blanco in a point to. Sit there with me here in doha. Show for this week if youd like to comment on anything that weve discussed here today you could tweet me im at a finnigan on twitter please use the hash tag a j c t c when you do or you can drop us a line counting the cost at aljazeera dot that is our email address as always theres plenty more if you online at aljazeera dot com slash c. T. C. That takes you straight to a page and theyll find individual reports links even a time episodes for you to catch up. But thats it for this edition of counts of the cost im adrian for the game from the whole team here in doha thanks for being with us the news on aljazeera is next. Think of some of the Biggest Companies in the world today all of them big tech with algorithms at their core the more that we used to want out of we produce were in the midst of a great race for dot and Big Tech Companies around the chase empires are rising on a wealth of information and wheat and other commodities in the sector from a 5 part series early reexamined where the corporations are all advisory. Like American Power of big tech and. This is aljazeera. Hello and welcome to the aljazeera news hour live from my headquarters in doha with me elizabeth piron im coming up in the next 60 minutes raising tariffs rates and warning american businesses against operating in china donald trump escalates the trade war. Brazil says its sending the army to combat the amazon wildfires as european leaders warned theyll sink a trade deal with south america. Meanwhile thousands gather in very real denouncing president balsam hours and mental policies. 10 years old and already a mother woman and children who sought refuge from fighting in my geria now face the threat of rape. And the last chance to save northern watch rhinos from being lost forever. U. S. President donald trump says hes raising a planned attack of sought a new set of chinese imports by an additional 5 percent the latest escalation in the trade war comes hours after beijing and tariffs on more American Goods trump also tweeted that hes ordering American Companies to find alternatives to china but he doesnt actually have the Legal Authority to enforce such a call earlier beijing said its imposing tower of some 75000000000. 00 worth of American Goods theyre due to come into effect in september and target u. S. Agricultural products crude oil and cause business groups have come out against cutting ties with china warning that it will hurt them as well as consumers the u. S. Chamber of commerce said a continued and constructive engagement is the right way with china lets get more on this now were joined by correspondent joe castro shes live for us in the u. S. Capital so president warned early on friday heidi that he would retaliate and hes now announced how. Thats right and the really attention grabbing part of this is not only that were at this point of escalation in the trade war but how quickly it got to this point mere hours between chinas announcement of the 70 5000000000. 00 worth of goods and additional u. S. Tariffs and now just hours later in a span of 280. 00 characters on twitter u. S. President donald trump firing back announcing this new policy that starting next month an additional 300000000000. 00 worth of chinese goods which is virtually all u. S. All chinese imports to the u. S. Will be taxed at a 15 percent tariff and then come october 250000000000. 00 worth of chinese good with tariffs increased to 30 per cent and this was just the last of the day in the twitter world for donald trump because earlier in the day when in response to china escalating those trade tensions he order he tweeted that he here by order is u. S. Businesses to e mediately cut ties with china now there is really no indication how or if the u. S. President has any power to make that happen but certainly the threat the oil itself spooked investors the dow jones was down by more than 600 points on that news alone elizabeth his tweets have had a lot of reaction did not just on wall street but as we mentioned by businesses and by consumers the heidi. Yes absolutely and part of the 2 is is just how quickly as i mentioned before how quickly this has developed to the really a boiling point in this trade war between the 2 biggest economies in the u. S. And trump earlier in the day also took unprecedented aim at the chairman of the u. S. Federal reserve general powell which is really in a political government position not to be influenced by politics but trump tweeted who is our bigger enemy jay powell the chairman or chairman see the leader of china so likening the u. S. Federal reserve chair to an enemy of the state really a dramatic statement to be made there trump is now on his way to france for the g. 7 meetings with other leaders of the worlds biggest industrialized nations and this escalating trade war between u. S. And china will certainly be one of the major points of discussion there elizabeth thank you for that is heidi koster with the latest live in washington d. C. We are going to stay with the story were joined by chris. Because financial and former u. S. Commerce Department Official under President Trump and hes also joining us live from washington d. C. Thea good to have you with us on aljazeera so president tried to balance thing more fatalities 3 tabs but will he go through with them do you think especially if they hurt u. S. Consumers the economy which he is relying on to get him reelected. Well thats a great question to ask because really frankly it comes down to who the real culprit is here who has been the bad actor in this trading relationship between the United States and china all signs point to china frankly it has been china who is engaged in intellectual property theft enforced Technology Transfer subsidizing state owned industries to make unfair competition really the norm between the free market traders that trade with them this is an imbalanced trading relationship that President Trump has been frankly the 1st in history to try to correct it diplomatic talks unfortunately have not worked and if we look at President Trumps trade tariffs threats in the past hes followed through on those tariff threats but and so i say its very clear now that the gloves are off the president will follow through on those tariff threats and do you think that the way he is going about trying to address what he sees as the trade imbalance is it going to get the results that hes off to china would say that its taken measures its other measures to address all of those concerns that its frankly not just the u. S. But listen to those that have and that has to trade imbalance though theyre lying theyre cheating this is a National Security were talking about the very future of the free world is at stake this is a very very real comparison between the values and the norms of the free market and the command and control type of economy that china has run the Chinese Communist party has engaged in these these these poor practices these bad actions for decades this is not certain just about the trade deficit this is now about. To a very small quick examples china agreed to stop selling fentanyl poison to the United States they couldnt even follow through on that very very easy easy concession after the president had delayed the tariff increases again the president knows that the only way that somebody like president xi will in fact. Will in fact follow through is by having a strong approach we have to push the pedal to the metal otherwise china will not respect us well lets see how president xi will respond they are of course going to be meeting at the g 7 that this weekend you brought up fenton in which the president has been tweeting about it along with. Blaming the chairman of the Federal Reserve your own pal what did you make of his twitter tirade earlier on friday as well as doing that ordering all American Companies to stop doing business in china he contact should he do that can he convince them to especially since they want to just have to relocate to lose a Consumer Base of some 1400000000 people well theres a lot to unpack there with that question but frankly the real the real issue at hand is. Its not the trade uncertainty that is leading to this this this type of negative reaction in the markets its the fact that really were not getting any support from the fed which is which is supposed to be acting in the u. S. Is interest thats what the president was elected to do to look out for not just wall street but also look out for main street now again the 2nd part of that question is is this in fact something that the president should be doing publicly well unfortunately because the president has received Something Like 90 percent negative coverage you know a recent study showed he uses twitter as a platform to tell them the American People what actually is going on so that theres no filter between the press and the American People so whats really going on here is what we really have to be concerned about its the National Security its whether or not we allow china to continue to take advantage of the American People to take advantage of american businesses and frankly as a free market nation who we pride ourselves we pride ourselves on this free market mr garcia can the rate of a free market nation tell American Companies to stop doing business in china. So the authority of the Legal Authority is under review i think of the white house would not of the issue the president would not have issued a Statement Like that unless he had some Legal Authority the White House Counsels Office is advising him very well and i have no doubt in that but aside from Legal Authority i know that the relationship for example with the president and tim cook the c. E. O. Of apple has been very strong as of late theyve been working very closely together and really the big story here elizabeth is that the American People know that with President Trump we have a president who is sticking up for us in the future of our nation and with those relationships he has with those companies that hes referred to i have a very good feeling that when he says that you should shift out of china that the white house and the administration are making great provisions to make those other supply chain nations a very attractive well turn it at the way to see what those provisions are but for now mr garcia we thank you for your time and your perspective on this that is chris gothia live out in the last sentence thank you. As the tide what looms large a g 7 leaders are gathering and this weekend for their annual Summit Global challenges on the table range from the economy to Climate Change on diplomatic editor james a bring us as the details from garrett. Just hours before the cheese 7 started and the Iranian Foreign minister was in paris mohammed job its a relief met with president mcchrystal new pictures of the meeting were released properly so as not to anger President Trump. The meeting behind the closed doors of the palace highlights the very different approaches of the u. S. And europe towards iran however there is a new face at this years g 7 u. K. Prime minister Boris Johnson some are speculating with brakes looming he may want to consider taking a tougher position on iran in order to win favor with trump. If Boris Johnsons Fertile Ground for no deal really is true and if what hes been doing in berlin and paris has really been a ready a ruse of sorts then youre going to see the u. K. Pivot towards the u. S. Theyre going to see the u. K. Start agreeing more of the u. S. Than is european neighbors and theyre going to start seeing a much more aggressive level of posturing from Boris Johnson who will be in the company of trump and who will almost be egging him on to start behaving in a way thats more u. S. Friendly than you friendly iran is just one of an increasing number of global issues where the 7 leaders are likely to have very difficult discussions the french president has already taken the unprecedented step of deciding not to seek a final communique at the end of the summit because he knows there are no words that will be able to sign up to a number of other countries have been invited to this years g. 7 Prime Minister Narendra Modi of india will be attending and the growing tension between his country and pakistan over kashmir is bound to be discussed growing trade was also leading to fresh rifts the u. S. And chinas difficulties could further destabilize the Global Economy and here in france
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