To cross and more im joined by my guest william look there are employer hes an assistant professor of economics of Florida Atlantic university as well as a director of the sound money project at the American Institute for Economic Research and in beijing we crafted to go he is the Vice President of the center for china and globalization harjo in crosstime group in effect that. Just a few hours ago unemployment data was just released now were up to over 20000000 people applying for unemployment in the United States who would have thought even 6 weeks ago its extraordinary and being a historian by trade i know the history of the Great Depression depression very well not only in the United States but globally so when i see these numbers come out its terrifying to hear how it is you know this pandemic will be resolved its only a matter of question and resources and patients because i understand that because ive been locked down for a month now and its getting very very tiresome. How is this pandemic going to impact the recovery in their. Its a recovery and i never thought in my my time i would ask about is there going to be a recovery because were seeing such amazing numbers that are just terrifying to the average person frankly go ahead meaning that we are were dealing primarily with a temporary supply shock right at the pandemic and so the most likely outcome is a v. Shaped recession that is a recession that has a recovery thats just as quick as the downturn. You know the virus is eventually going to run its course and when it runs its course most of us are going to return to the to the Consumption Patterns that we had before will consume the same goods and services and most of us are going to return to the jobs that produce those goods and services but there there are 2 factors that could significantly change that it could change the v. Shape recession into a huge shape recession where the depth of that recession the low output lasts much longer and the recovery kicks off much later and the 1st is the duration of the pandemic the longer this virus lasts the more businesses are going to fail and when a business fails the the labor and the equipment of that business have to get reallocated to some other business and that takes time delaying the recovery the 2nd and maybe the thing that we have a lot more control over is our policy response now some of the policies that weve been active here in the u. S. They intend to speed up the recovery so the Paycheck Protection Program for example a provides loans to Small Businesses that keep their personnel and that will enable them to ramp up production as soon as its safe to do so but other policies other policies look likely to prolong the recession so here in the u. S. We have ratcheted up Unemployment Benefits by 600. Bucks. Per week through july and as you said you know record numbers of unemployed unemployment claims right now that just ask yourself if if you were previously making say 20 dollars an hour and now you can make 15 dollars an hour for 40 hours a week not working at all how likely are you to return to work before july and so you know 20. 00 an hour thats 40000. 00 a year in terms of an annual salary manny of the people who have filed unemployment claims make less than that and so i think that its very unlikely that those folks return to work before july. Well thats very interesting i think most people do like to work though and i think they want to earn more but thats a different topic id like to talk about u. B. I. In a different topic is i think its a fascinating concept and i can actually as a conservative there is a contrary conservative position on that that might surprise a lot of people let me go to victor in beijing victor and obviously politics is playing a role in all of this i mean its no secret if you watch Mainstream Media particularly in the United States and how the United States should react and its quite frankly very anti china in rhetoric here but i mean the theres been this talk over the years of the last 40 years of coupling china within the Global Economy led by the United States and its allies and to be frank about that but now we come to this and and there is talk about the supply chains and particularly when it comes to pharmaceuticals and the Health Industry in general here i mean even if even if there was a political push to change the current reality which i seem very unlikely because these are Business Decisions and that government decisions then its a very complicated issue because you have trade relations that are. Expect very extensive very deep in the profit motive is obviously there but you come out with this rhetoric now that you know has china must pay much i dont have my reparations and all this i mean on one side one can understand you know the frustration it may be correct may be incorrect that i dont think we really need to discuss this here but the fact of the matter is is that trade relations are being reexamined here and how do you see that moving forward because of chinas time extremely well over the last 40 years because of what is called globalization how does that change with this pandemic go ahead victor. Well i would say this current not virus oil related reduced. Fine history as we understand it and the world of tomorrow will be very very very profoundly different from the world we have being so accustomed to and i think we need to do a lot of rethinking about almost all aspects of life and our work now as for the globalization i dont think that has coronavirus will stop the advance of globalization you talk about supply chain is rome is not built in one day and supply chain is not built in one day if anyone want to change supply chain fundamentally it cannot be done in one day or it was stroke and fundamentally if you really want to readjust a supply chain you really need to come up with a recipe to advance competitive business to increase spend if its follow all the parties involved rather than destroying value so im a Firm Believer that the world of tomorrow will continue to see a lot of division of work a lot of supply chain there will be adjustments but i dont think fundamentally the u. S. Government or President Trump will be able to re all re and supply chain as they want to because businesses will not buy the story. Dont you feel that victor he didnt have to come next the point of the program william jump in please do yeah i agree with victor here in terms of globalization you know theres a lot of talk about supply chain diversification right now but we have to keep in mind right that. Theres only so much that you can do in the Global Economy chinas a big player and the idea that we would somehow pursue a non china strategy or Something Like that is is is crazy theres certainly in vietnam right now they can produce anything that is currently produced in china but they cannot produce everything that is currently produced in china because there are 14 people in china for every one person in vietnam and so were still going to have a Mint Division of labor and china is still going to be a very big part of that immense division of labor. Well but still and im im trying not to invoke too much politics into this but i mean it is very much the flavor of the moment because i will be perfectly honest with you as i think because of the way the medical system in the United States exists it was very vulnerable to it to a black swan event like this ok and in a lot of people have questions because im not its up i mean having a you recovery would be that would be great news to hear ok but i mean when you think of so much of value that is being destroyed as we speak right now and you think of the consolidation thats going to happen is a result of where a business as well as the ones that will maybe just teeter in just you know maybe make might make it might be these what gobbled up by a much bigger player and so as a result of this. Recession that were going through here were going to have fewer players are going to have more inequality so you know that thats going to make it a very wobbly ewen that and thats the optimistic case i would say and plus im going to agree with both of you government policy is one thing but private enterprise is another thing and there is a symbiotic relationship between those 2 that isnt often enough talked about ok because i believe that doing away with 40 years of globalization is just insane it would be it would break the Global Economy but at the same time i think theres going to be the issue and i want to go to victor here the issue of sovereignty and economic sovereignty and i think one of the things that is a result of this pandemic is health sovereignty as well and these are going to play into this future that picture was talking about go ahead victor. Well i would say as revealed by this corona virus pandemic Different Countries and different regions have different standards for protective masks and as a result of this had that make we realized that these different standards actually served to hinder the effectiveness of the fight against the corona virus and also to politicize the production and the supply of facial masks further put more lives especially doctors and nurses to their risk therefore i think one can actually argue just the opposite that is Going Forward in the world of tomorrow we need to have greater internationalization better standardize ation so that the world as a whole can be better prepared against a pandemic like the corrode the virus and also in many other respects and in telecommunication media etc which have really played a very Important Role in helping mankind to fight against the corona virus this time i think in the world of tomorrow we will see more and more applications based on 5 g. Or 6 g. Going forward so that way mankind as a whole will be better prepared for all the changes brought about by a big pad that make it like this we need to change but i dont think the equalization will be to make a trend i dont think destroying the current supply chain will be serving any was positive interest at all we still need to move forward beyond the horizon for the new world and everyone of us need to pitch in and the world of tomorrow will be better to let it it means youre pulling me into politics thats not exactly where i want to go but anyway i mean that would mean that the United States has to recognize china is an equal peer. And that doesnt seem to be became ok because the more china becomes appear the more its demonized in parts of the American Media and the american Political Class because the United States has never had a peter ever and thats something that its very difficult for at least to get used to particularly this sense of american exceptionalism that i was brought up on im generations of americans i did its very difficult im agreeing with you china should be recognized as a peer but that something new all right gentlemen im going to jump in here were going to go to a short break and after that short break well continue our discussion on the Global Economy state with our. Im not for decapitating anybody but i am for day capitalizing all the wall street bankers by shifting the center of gravity of money from the dollar and fear to fit coin and thats perfectly within our purview our scope. Of global citizens who wish Justice Justice to free competition and hard money thats the only just a stud matter thats sustainable thats real that doesnt rely on politicians. It has changed american lives but pharmaceutical companies have a miraculous solution. Based drugs the people who are chronic pain patients believe that their prescription is working for them and the remedy be said to. Price at the. Close of dependency and addiction to opiates to long to use that really isnt scientifically just now study actually suggest that. The long term effects may not just be the absence of benefit but actually that they have made because we want to. Welcome back to cross top where all things are considered im Peter Lavelle reminder were discussing the Global Economy after the pandemic. Ok lets go back to william in florida here well i mean how do you think the economys going to change i mean what sectors are going to. Flourish and what sectors are going to be made make completely disappear i mean how is the job market changing because you said earlier in the program that we could get a v. Recovery but at the end were talking about a lot of jobs in small and midsize businesses and you know it with every passing day even every passing hour those companies are really much in danger and personally looking at the mechanism to help them through this through this bailout stimulus is its almost to the point of farcical i mean a lot of these people just cant wait ok and those jobs will go somewhere else or people going to have to retool and i have to point out the night that something that id like to say on this program here is that when you look at millennial this is the 2nd time. It had to go through this ok. You know the maybe the economy can find its way but people are having a harder and harder time in which is you know lives. In a direct injection of cash you know 1200. 00 most of us not going to go to consumption mo but most of its going to go paying off debt so i mean is this enough to really stimulate the economy to really get it going because as i pointed out you know with it were going to have a new consolidation of different sectors where the bigger get bigger in the smaller ones will disappear i mean how do we point them dont heading. Well i think in terms of the long term impact here i think theyre going to its going to be relatively modest so consider consider the cruise line industry its hard to imagine an industry that has suffered a bigger reputational below than the cruise line industry and we have lots of recreational affirmative but its actually not only our crews booking not down in the future next years cruise bookings are up 40 percent over last years Group Bookings and so that suggests to me that most people just want to get back to something approximating normal now for the production decisions in the economy firms are going to produce what people want to consume and so maybe some of those businesses are going to fail particularly if the virus lasts a long time or if our policy responses make labor market and flexible but were going to ultimately end up with the goods and services that people want and so i just dont think that the economy is going to look all that different say 5 years from now what all of this is cleared. You know if youre. Looking at how china is the dealt with this here i mean is it is it is it its global trade relations going to be significantly altered because we know we before all this happened we had kind of the the baby steps with beijing and washington coming to trade agreements i mean a lot of talk but not not a whole lot is happening thats something thats an agenda that still needs to be played out and certainly far from over and then we have this black swan event here and again you cant keep politics out of it i mean a lot a lot of people are again i want to go back to the supply chains here where they want to and they want to avoid have having this happen again and we can be very specific you know like and i biopics or something 90 percent are produced in china that are exported to various countries including the United States i mean if the United States were going to you know have a very strong barrier to that i mean and im just giving that one example here i mean how wouldnt china have to readjust and what isnt really learned from this pandemic in terms of International Economics go ahead nick. Well purely from the chinese perspective it makes more and more realize that the trade war was the wrong war the United States initiated it china had no other choice but to retaliate against the United States and the 2 countries and is up bruising each other if not really getting to each others general or to the mutual detriment of all the Chinese People and the American People if we can go back to history and restart this again i want to do my best to convince President Donald Trump not to launch a trade war but to do our best to further increase the trade volume between china and the dotted states so that we the 2 largest economies in the world can better trade with each other with fewer restrictions with little if not no terrorists so that more and more people in the United States businesses farmers you name it can sell more to china this will truly stimulate the economic girls of the United States now we are stuck with this trade war and this coronavirus makes a very bad situation much worse because now were talking about lives and deaths of the people in the United States as well as here in china therefore i think when the dust does settle down i hope the establishment see in china and the United States the intellectuals that issue makers the think tanks will reading a rethink and really go through all this painful process and pragmatism and realism will be much much better then what have a single isnt or your desire to go to the general or against the other side i think Going Forward we will more acutely realize that this is truly interconnected world no matter whatever you want to do no madam whatever you call d walls you want to erect you can a high pay high and the walls the world is interconnected. Yet there isnt there i mean no most i had. No one wins a trade war no one wins a trade war and in the case of President Trump straight war most of the costs of those tariffs have been borne by American Consumers and so not only did that make us poorer than we otherwise that would have been in the short run there but it also undermined our ability to combat this pandemic that followed even if ever so slightly you have it william dont you know we have to go back to really got donald trump elected in the 1st place in 2016 it was about trade ok most people on the left in the liberal media dismissed it is being fanciful but its not true you go to the midwest where im from its been hollowed out ok its been hollowed out of industrial jobs and and factories have been shut down and so i mean this again i think this is a moment you could look at it in a different direction not that im necessarily disagreeing with you 2 gentlemen here but i can see Political Forces to say this is an opportunity finally that we have to start a new industrial policy in the United States and because jobs dont come back you create jobs and you give incentives to create jobs and you have an Industrial Base in the United States where i think would be perfectly reasonable to have a Health Care Sector that created its own antibiotics for example and you see what im trying to say here i mean i im not against International Trade i mean a competitive advantage i mean everyone wins thats the theory and thats the practice but if you dont have an Industrial Base you dont have much to compete with you see my point. Peter i am from the midwest as well i grew up in rural southern ohio and i think no one would argue that the gains from globalization have been distributed evenly but we shouldnt lose sight of the fact that the gains have been huge and although they havent been distributed evenly they have been distributed far and wide but but dont take my word for it you know were all working from home these days and so when youre when youre Binge Watching shows on netflix it takes some time to watch a couple episodes of the wonder years or cheers i see how life was depicted for a typical 1960 s. 1970 s. Family or a 1980 s. Blue Collar Worker and then look around things are so much better today and thats just undeniable and its not just for the local at least its not because of i dont remember the model are down. There not that many blue collar jobs they keep disappearing i mean i would i would have the exact opposite really reflection about what it was like then and what its like now because the blue Collar Workers were in cheers and had had a stable job could make a living pay the mortgage maybe even put a kid through school and when thats not happening right now when you have it back then you didnt no one would have remembered understood what the economy is where people were doing 3 jobs a day every single day i mean its a bet every different reality yeah its nice you know its you know its going back being looking at a more happy time but even with this entire event with it happening with the economy is that even the get the economy might not be able to respond very well because you know automation ok why do we need to have these people as careers why do we need to have drivers and hooper and things like that i think its a very different reality here let me go to victor here victor i mean how does it change china i mean theres always these you know if you look at Mainstream Media theres a certain filters ok i could look at a. M s n b c and c. N. N. And they have a certain filter in looking at china and then you go over to fox news and has a very different filter here and not having visited china i tend to not trust any major news source in the United States when it comes to china how is china changed because of this pandemic. Well i think china will change more profoundly. Mainly because i think the whole nation cannot afford to be complacent and we need to be prepared against a 2nd a wave of the infections either domestically generated which is less likely or flooring imported and i think Going Forward until mankind has developed an effective vaccine probably we need to put everything into 2 modes the normal mold which were more fair with and then the extra ordinary the emergency modes and we need to be able to shift from the 2 modes at any moments notice because we cannot put lives on the people at risk thats exposed in the current virus pandemic now Going Forward also allow me to make one point i think politicians in the United States are barking in the wrong tree when they really want to get to the juggler y. Because the real competitiveness of the chinese economy was not just the cheaper labor cost for example its that really very much upgraded infrastructure and all the brand new 4 g. Of 5 g. And that innovative spirit to move forward so there are lots of things which are happening china today which often heard off in the United States and i see this lays the background why it is much better and more effective to do business here in china now if some of the politicians really want to relocate all the shoe manufacturing capacities toy making capacities back to the United States be my guest but i dont think the American People will be better served with that you really need to come up with great eagerness to innovate to move forward to really strike a deal grounds and i think from the Chinese Press back to the American People and the american as a country are well positioned to make so many. Nor was it ovations as strike new fields of development and i think those are the areas that the americas could focus all more productively and also build up the infrastructure build up and bites you actually look very good at it navel the American People to produce more effectively and thats exactly where i want to go william infrastructure i mean how can it possibly be a political issue when a country desperately needs i ive tried before all this i traveled to so many places around the world that we would call emerging markets or in early in my lifetime we call a 3rd world country and the infrastructure that you see is extraordinary in there is because these countries that invest in their own people they invest in their own economy here that would solve a lot of problems i think in dealing with this india and inward and actually be a part of the process of an International Reaction to a future pandemic if you have good reason resources and infrastructure to fall back upon them so i hope thats one thing that will take from this whole experience particularly in the United States go ahead. Well in those countries where you have big state owned enterprises you get big state sponsored Infrastructure Projects but also a lot of other projects that are pretty wasteful and so you have to choose not just the projects you want but you have to choose the project on bills and here in the u. S. You know ok we dont get those big Infrastructure Projects and maybe some of those projects would be desirable but we also get all the big ways for projects that you see in places like china as well and so i think its a mixed bag with these Infrastructure Projects yeah we want more of them but its not easy no other bats which when you want it jobs at a time we need jobs i think you would agree on. Well we dont want jobs for jobs sake we want jobs because people are producing valuable goods and services or valuable input structure or durable goods that will last into the future you know when people digging holes and building them up again much better just to let them stay home and enjoys at leisure time than the waste their time producing beings that nobody want to be going to be built airports and bridges and fix the roads because everyone would benefit and that is well and private enterprise why should i want to not it right we also have to think about the cost though what those resources could otherwise be used for right sure there will be benefits but the relevant question is whether those benefits are going to be greater than the calls ok gentlemen we are going to end the no one to see the benefits for working people right thats all the time we have here i want to thank my guests in florida and in china and i want to thank our viewers for watching us here at you see you next time remember. To. Thank. You oh oh
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