Transcripts For CSPAN Washington Journal Daniel Franklin 202

Through november. Elsewhere, as we have seen in recent days, it is a risky world, and the pace of change seems to be so fast. Host you break it down into many different facets, which i think viewers will find interesting. You begin saying it is judgment time. It is doubly true for President Trump, first in congress as the democrats try to remove him from office, and then with this election in november. Tell me about judgment time. Guest i think the world will be watching. This is something that clearly concerns the u. S. , but given the importance of this country to everything that happens around the world, this is an international, global drama. I think particularly starting with the actual impeachment trial in the senate, people will be tuning in, and then particularly once we get to the further stages of the democratic nomination process, everybody will be fascinated. We dont actually make a prediction in this volume, but we did ask an Artificial Intelligence what it thought would happen, and it did predict donald trump would lose. That is not a prediction to take terribly seriously, but it was more to test the skills and Artificial Intelligence can work. Host we have talked about judgment time, meaning the impeachment and the election. You speak about the economy. The economy is wrestling with negativity, not so much in this country, but what are you writing about the guest i think it is a tough time around the world. India has slowed rather dramatically. Europe has been struggling with almost a recession in germany lately. It is not a particularly pretty picture around the world. The exception is the u. S. , where i think people have been somewhat cheered up, surprised that a recession that looked not so long ago looks less likely. That has repercussions because how the economy performs here will have an influence on the way the voters feel about things come november. Host do you do this addition every year . Guest yes, we do. This is the 34th edition. I have done 17 of them as editor. I think it is a natural time to look ahead. We come out with this just around thanksgiving. Every year, i have had the joy of looking back at what we wrote the Previous Year and trying to assess what we got right and wrong. Host how do you decide what topics to cover . Guest we have a brainstorm among colleagues, and then we are constantly scanning big events, anniversaries, topics we want to cover. We pick people we think will be influencing things at the yearend, politicians, scientists, business people. Host lets put the phone numbers on the screen for Daniel Franklin of the economist as we look ahead to the year 2020 domestically and around the world. Democrats, 202 7488000. Republicans, 202 7488001. Independents, 202 7488002. We are taking a look at this publication, the economist. It is the world in 2020. We have been talking about politics, impeachment, the president ial election, economics. You also write about china. You write china highlights positivity. What does that mean . Guest china had a rough time in 2019 because it had some tricky anniversaries to get through, particularly tiananmen square. They had a target at the end of the year to achieve something they called moderate prosperity. It does not sound terribly grand, but they set this target back in 2012, doubling the National Income over 2010 levels cannot doubling 2010sable income levels, doubling disposable income, the elimination of extreme poverty in every region. These are quite ambitious targets. They will have come pretty close. This will be important for xi jinping to claim they have reached a new level of this extraordinary lifting of people out of extreme poverty, which was the situation not many decades ago in china. Host how is the relation between the u. S. And china . Guest this is essential, not only on trade, but across all aspects of the relationship, including technology. We write about we call the splinternet of things. The possibility is we are on different tracks. The chinese and the americans are going to be separated off for fear of security essentially, and who controls which critical technologies. I think this is a very tricky relationship. There is a deep recognition in the u. S. Now that china is a longterm strategic challenge to americas essential supremacy in the world, which it has come to take for granted in recent times. Host we know in a couple days they are signing the socalled phase one trade agreement. Will there be a phase two . Guest eventually. I think it is in the interests of both governments to have some truce in what has been an unsettling trade war. For the u. S. , President Trump, a truce with china helps the market, which helps the economy. China has not found it easy to grow, not as fast as it has done. It wants to see things settle down. As i also mentioned, this sense of strategic rivalry goes very deep. Host what does that rivalry mean to the rest of the world . Guest i think it is tricky for many other countries to position themselves. For many places, china is their main trading partner, but many of the same places, the u. S. Is their main security partner. They often try to avoid the tricky choice between china and america. That is getting harder on many issues, such as, what do you choose for your technology, who do you get to invest in your Critical Infrastructure . Those issues are becoming much harder for them and are being asked across the world from europe to asia. Host we will go through the rest of the list from the economist of what to watch out for in 2020. Lets get to the calls. Florida, democrat, steve. Caller good morning. Thanks for taking my call. I have a question for mr. Franklin. As far as economics goes and what i have seen in my lifetime and the decisions i make to vote, i have always been frustrated by what is fed to me as a theory of supplyside economics. You hear politicians say if you cut corporate taxes, if you deregulate, if government decreases regulations, it puts money into the private sector, and businesses expand, and therefore hire. In my lifetime, i feel like i have seen this movie for the third time. It starts out as an economic boom, and then it crests. I guess what i want to ask you is, how much of this economic theory is political, and do you see flaws in it, and how much impact do you think it has on the economy we are enjoying now . Guest a very big question about economics. This argument will continue to rage on. It is political because ultimately it is politicians who make the decisions about how to proceed with economic policy. I think there is a balance. If you go too far in one direction, you hit trouble. Right now, in many parts of the world, there is the sense that there is too much bureaucracy getting in the way of growth. We have an article published in this edition by the head of the world bank who argues that if you reduce that level of regulation, you can unleash a lot more growth. At the same time, you have to be careful of levels of debt that are quite high in some countries, and then you get the problems of assuming a growth model that is too far in one direction. I dont think we are going to end this argument anytime soon. Host michael, calling from illinois, republican caller. Caller good morning. I would like you to comment, your guest, to comment on Interest Rates. Interest rates are being cut again. Everyone knows that 70 of any economy is driven by consumer spending. As a senior, i depend on fixed income investments to supplement my meager retirement. I have just been devastated by this policy of blocking off any normal pattern of investing so that all the money is going into the stock market. For an older person, this is like suicidal, because if it corrects, when i need the money, i could starve. I want you to focus on how these artificially low Interest Rates are destroying my capability to help the economy by spending more money. Guest i think you are describing a real problem. You probably should be thankful that you are not living in europe where it is an even bigger problem. I talked earlier about negativity in the economy. In europe, you have Interest Rates moving in the negative territory. In some places, you can get payback less on a loan then you took out. You can take out a mortgage where you are paying back less of the amount than you were at the beginning. This is a very odd, alice in wonderland, topsyturvy world. It is tricky for people who rely on interest from savings. I think we are still feeling the economic crisis and feel it working through the system. It is rather New Territory for Central Banks to be living with these negative Interest Rates for so long. Host back to the list of the big events to watch out for in 2020. Sports, you bring up sports. Moving from the economy to sports. Guest it is nice to talk about sports because that is a cheerful thing. A lot of other things we have are tricky. Sports, it is an olympic year first of all. Olympic games in tokyo in summer. I think it is probably the event in 2020 where you will have the greatest number of people watching the same thing. That makes for a global conversation. It is a big opportunity for japan to represent itself to the world. With all the rise of china that we were talking about earlier, people tend to forget about japan but it is still the thirdbiggest economy in the world. It had a big sporting tournament last year that you probably did not Pay Attention to the u. S. Because rugby is a big event there. It did very well. They are trying to present an image of a much more userfriendly place, encouraging tourism. At the same time, there are new sports, rock climbing, skateboarding. There will be an interest in that. Beyond the olympics, there is also, if you are a soccer fan, it is euro 2020, which is taking place across a dozen countries in europe and the final will be at Wembley Stadium in london. Host you mentioned japan. That reminds me of number five on the list, worries about nukes proliferate. Japan is always watching out for what north korea is doing. This is quite a radical shift. Guest you have the cheerful stuff with sports and then the really gloomy stuff, which is nuclear proliferation. That is going to be on peoples minds in 2020, not least because there is the review conference of the Nuclear Nonproliferation treaty happening in the spring. This happens every five years. It will not be a cheerful fair this time because people have serious concerns about what is happening in this arena. A lot of the guardrails and agreements we have had in place on the Nuclear Front have either disappeared or are falling apart. We have said goodbye to the intermediate Nuclear Range treaty. There is a question over whether the treaty that covers , the socalled new start treaty, whether that will be extended just after the end of this year. We have seen what is happening in iran with the dispute over the the Nuclear Agreement there, and the north korea problem has not gone away. You have other countries are looking at this and saying, maybe we need to rethink our nuclear strategy. Maybe we need to get hold of Nuclear Weapons too. The sense we had something of a lid on nuclear proliferation, but that is looking shakier. Host we have bill from new york, and independent. Caller thanks for taking my call. I was in london on june 23 when they had the brexit vote. Im interested in hearing what mr. Franklin thinks how britain would look different at the end of this year as they leave the European Union. Guest brexit, first thing to say is we are going to actually have brexit shortly. That was not obvious until we had our election last month, which resulted in a very clear victory for the conservatives under Boris Johnson and therefore his ability to pass the brexit law through the parliament, which is now happening. At the end of january, britain will be out of the European Union. There is a huge difference between being in and out. That is a huge change legally. It is not yet a big change on the ground. Through the end of this year, we still have a transition where the same rules and regulations apply. It is not a dramatic change. But there is the ambition to do a trade deal, a new treaty governing the future relationship between britain and its European Partners by the end of the year, and that is a hugely ambitious goal. I dont think they are going to manage to achieve the comprehensive treaty that is sometimes talked about. There is still a lot of negotiation to be done. We will shortly have the divorce. How britain and the European Union live together sidebyside, extremely integrated trading partners, how that happens, that is all still up for grabs. Host what does an updated u. S. U. K. Relationship like post brexit . Guest that is something the Trump Administration has been making very encouraging noises about, how quickly it might happen. These things are complicated to negotiate. I think from the british perspective, once we are out of the European Union, the relationship with u. S. Becomes all the more important. It has always been important. It becomes crucial. We are much more midatlantic once we are out than we were before. Host ivan is calling from texas on the republican line. Good morning. Caller if anybody likes the economy now, they need to vote for donald trump. The democrats already said they are going to triple our taxes just to pay for whatever they think donald trump has done. Then they call for wanting to charge donald trump for war crimes charges. I guess they forgot about george bush, Madeleine Albright, condoleezza rice. They dont talk about that. Why dont we just turn these people over to the war tribunal and take care of this problem . The democrats need to get out of the way so this country can move on or move to a different country if they want to live in el salvador. Host do you see anyone on the democratic side making a compelling enough economic argument to defeat President Trump . Guest i think the argument is one thing, but the state of the economy is another. How well people feel the economy is going. There is a potential for things to go wrong between now and the moment. The economy looks pretty strong. The American Consumer is an extraordinarily potent and persistent player. There has been a resilience. This is already the longest expansion in u. S. History. At some point it will end, and there have been occasional worries. That will play into things as well. What is happening on the ground. On the question of the candidates, a lot will depend on appealing to those that dont feel they have benefited so much from the expansion the economy has had and this question of who gains and how it is distributed will be a big one. Host on page 39 of this edition of the economist, figuring out the 2020 race. What do historical statistics and current numbers say about the election . Guest the current data says the incumbent president starts with a big advantage. They tend to do well. If their Approval Ratings are as low as Donald Trumps have been, that makes you think this might be an exception. You can look at the statistics every which way and come up with different conclusions. The fact is there are still so many variables in this campaign that anyone who thinks they know which way it is going to go in november is probably fooling themselves. Host you are on with Daniel Franklin. Good morning. Caller thank you very much. Thank you for having me on. Thank you for taking my questions. I have three quick points. I consider this should be front page news everywhere, but it is not. Currently, the central bank starting in september, late october, has pumped more money into the Financial System than at any time since the great financial crisis, approximately 400 billion and counting. There is a perfect correlation with rising stocks and these qe measures the fed takes. It is almost a 100 correlation. I trade Financial Instruments for a living, so i know something about this. I was curious why nobody is covering this, since it is so dramatic and out of the ordinary, and if i could just get one other quick point here. I consider the stock market a little bit of an inequality index. The vast majority of people dont own any stocks. There is a small majority that own 40,000, but the majority is owned by the 1 . This is the third asset bubble i have seen in my lifetime. These sort of things should be generational. It seems like we have Central Banks that have lost their minds. They keep doing the same things over and over again, and the rich keep getting richer. The billionaires in this country had a 25 increase in their net wealth this year alone. That is a direct correlation with the stock market rise. If you could comment on those things, and i would like to say to the people out there, two Percent Inflation mandate by the fed his a joke. 2 , you lose your purchasing power every 20 years by 50 . Boeing trading at a market multiple at 50 times earnings is ridiculous. If you look at the multiples on some of the stocks, they are like the dotcom bubble. Guest we were talking earlier about what could the democrats do to get purchase . You heard some of the arguments there. There are vast swaths of the population that are missing out on the benefits. On the question of the Central Banks, i think this is somewhat removed from politics in that you do have independence from the central bank, and the u. S. Is not alone. Europeans are pumping lots of money into the economy. They still have largescale quantitative easing and even lower President Trump<\/a>, first in congress as the democrats try to remove him from office, and then with this election in november. Tell me about judgment time. Guest i think the world will be watching. This is something that clearly concerns the u. S. , but given the importance of this country to everything that happens around the world, this is an international, global drama. I think particularly starting with the actual impeachment trial in the senate, people will be tuning in, and then particularly once we get to the further stages of the democratic nomination process, everybody will be fascinated. We dont actually make a prediction in this volume, but we did ask an Artificial Intelligence<\/a> what it thought would happen, and it did predict donald trump would lose. That is not a prediction to take terribly seriously, but it was more to test the skills and Artificial Intelligence<\/a> can work. Host we have talked about judgment time, meaning the impeachment and the election. You speak about the economy. The economy is wrestling with negativity, not so much in this country, but what are you writing about the guest i think it is a tough time around the world. India has slowed rather dramatically. Europe has been struggling with almost a recession in germany lately. It is not a particularly pretty picture around the world. The exception is the u. S. , where i think people have been somewhat cheered up, surprised that a recession that looked not so long ago looks less likely. That has repercussions because how the economy performs here will have an influence on the way the voters feel about things come november. Host do you do this addition every year . Guest yes, we do. This is the 34th edition. I have done 17 of them as editor. I think it is a natural time to look ahead. We come out with this just around thanksgiving. Every year, i have had the joy of looking back at what we wrote the Previous Year<\/a> and trying to assess what we got right and wrong. Host how do you decide what topics to cover . Guest we have a brainstorm among colleagues, and then we are constantly scanning big events, anniversaries, topics we want to cover. We pick people we think will be influencing things at the yearend, politicians, scientists, business people. Host lets put the phone numbers on the screen for Daniel Franklin<\/a> of the economist as we look ahead to the year 2020 domestically and around the world. Democrats, 202 7488000. Republicans, 202 7488001. Independents, 202 7488002. We are taking a look at this publication, the economist. It is the world in 2020. We have been talking about politics, impeachment, the president ial election, economics. You also write about china. You write china highlights positivity. What does that mean . Guest china had a rough time in 2019 because it had some tricky anniversaries to get through, particularly tiananmen square. They had a target at the end of the year to achieve something they called moderate prosperity. It does not sound terribly grand, but they set this target back in 2012, doubling the National Income<\/a> over 2010 levels cannot doubling 2010sable income levels, doubling disposable income, the elimination of extreme poverty in every region. These are quite ambitious targets. They will have come pretty close. This will be important for xi jinping to claim they have reached a new level of this extraordinary lifting of people out of extreme poverty, which was the situation not many decades ago in china. Host how is the relation between the u. S. And china . Guest this is essential, not only on trade, but across all aspects of the relationship, including technology. We write about we call the splinternet of things. The possibility is we are on different tracks. The chinese and the americans are going to be separated off for fear of security essentially, and who controls which critical technologies. I think this is a very tricky relationship. There is a deep recognition in the u. S. Now that china is a longterm strategic challenge to americas essential supremacy in the world, which it has come to take for granted in recent times. Host we know in a couple days they are signing the socalled phase one trade agreement. Will there be a phase two . Guest eventually. I think it is in the interests of both governments to have some truce in what has been an unsettling trade war. For the u. S. , President Trump<\/a>, a truce with china helps the market, which helps the economy. China has not found it easy to grow, not as fast as it has done. It wants to see things settle down. As i also mentioned, this sense of strategic rivalry goes very deep. Host what does that rivalry mean to the rest of the world . Guest i think it is tricky for many other countries to position themselves. For many places, china is their main trading partner, but many of the same places, the u. S. Is their main security partner. They often try to avoid the tricky choice between china and america. That is getting harder on many issues, such as, what do you choose for your technology, who do you get to invest in your Critical Infrastructure<\/a> . Those issues are becoming much harder for them and are being asked across the world from europe to asia. Host we will go through the rest of the list from the economist of what to watch out for in 2020. Lets get to the calls. Florida, democrat, steve. Caller good morning. Thanks for taking my call. I have a question for mr. Franklin. As far as economics goes and what i have seen in my lifetime and the decisions i make to vote, i have always been frustrated by what is fed to me as a theory of supplyside economics. You hear politicians say if you cut corporate taxes, if you deregulate, if government decreases regulations, it puts money into the private sector, and businesses expand, and therefore hire. In my lifetime, i feel like i have seen this movie for the third time. It starts out as an economic boom, and then it crests. I guess what i want to ask you is, how much of this economic theory is political, and do you see flaws in it, and how much impact do you think it has on the economy we are enjoying now . Guest a very big question about economics. This argument will continue to rage on. It is political because ultimately it is politicians who make the decisions about how to proceed with economic policy. I think there is a balance. If you go too far in one direction, you hit trouble. Right now, in many parts of the world, there is the sense that there is too much bureaucracy getting in the way of growth. We have an article published in this edition by the head of the world bank who argues that if you reduce that level of regulation, you can unleash a lot more growth. At the same time, you have to be careful of levels of debt that are quite high in some countries, and then you get the problems of assuming a growth model that is too far in one direction. I dont think we are going to end this argument anytime soon. Host michael, calling from illinois, republican caller. Caller good morning. I would like you to comment, your guest, to comment on Interest Rates<\/a>. Interest rates are being cut again. Everyone knows that 70 of any economy is driven by consumer spending. As a senior, i depend on fixed income investments to supplement my meager retirement. I have just been devastated by this policy of blocking off any normal pattern of investing so that all the money is going into the stock market. For an older person, this is like suicidal, because if it corrects, when i need the money, i could starve. I want you to focus on how these artificially low Interest Rates<\/a> are destroying my capability to help the economy by spending more money. Guest i think you are describing a real problem. You probably should be thankful that you are not living in europe where it is an even bigger problem. I talked earlier about negativity in the economy. In europe, you have Interest Rates<\/a> moving in the negative territory. In some places, you can get payback less on a loan then you took out. You can take out a mortgage where you are paying back less of the amount than you were at the beginning. This is a very odd, alice in wonderland, topsyturvy world. It is tricky for people who rely on interest from savings. I think we are still feeling the economic crisis and feel it working through the system. It is rather New Territory<\/a> for Central Banks<\/a> to be living with these negative Interest Rates<\/a> for so long. Host back to the list of the big events to watch out for in 2020. Sports, you bring up sports. Moving from the economy to sports. Guest it is nice to talk about sports because that is a cheerful thing. A lot of other things we have are tricky. Sports, it is an olympic year first of all. Olympic games in tokyo in summer. I think it is probably the event in 2020 where you will have the greatest number of people watching the same thing. That makes for a global conversation. It is a big opportunity for japan to represent itself to the world. With all the rise of china that we were talking about earlier, people tend to forget about japan but it is still the thirdbiggest economy in the world. It had a big sporting tournament last year that you probably did not Pay Attention<\/a> to the u. S. Because rugby is a big event there. It did very well. They are trying to present an image of a much more userfriendly place, encouraging tourism. At the same time, there are new sports, rock climbing, skateboarding. There will be an interest in that. Beyond the olympics, there is also, if you are a soccer fan, it is euro 2020, which is taking place across a dozen countries in europe and the final will be at Wembley Stadium<\/a> in london. Host you mentioned japan. That reminds me of number five on the list, worries about nukes proliferate. Japan is always watching out for what north korea is doing. This is quite a radical shift. Guest you have the cheerful stuff with sports and then the really gloomy stuff, which is nuclear proliferation. That is going to be on peoples minds in 2020, not least because there is the review conference of the Nuclear Nonproliferation<\/a> treaty happening in the spring. This happens every five years. It will not be a cheerful fair this time because people have serious concerns about what is happening in this arena. A lot of the guardrails and agreements we have had in place on the Nuclear Front<\/a> have either disappeared or are falling apart. We have said goodbye to the intermediate Nuclear Range<\/a> treaty. There is a question over whether the treaty that covers , the socalled new start treaty, whether that will be extended just after the end of this year. We have seen what is happening in iran with the dispute over the the Nuclear Agreement<\/a> there, and the north korea problem has not gone away. You have other countries are looking at this and saying, maybe we need to rethink our nuclear strategy. Maybe we need to get hold of Nuclear Weapons<\/a> too. The sense we had something of a lid on nuclear proliferation, but that is looking shakier. Host we have bill from new york, and independent. Caller thanks for taking my call. I was in london on june 23 when they had the brexit vote. Im interested in hearing what mr. Franklin thinks how britain would look different at the end of this year as they leave the European Union<\/a>. Guest brexit, first thing to say is we are going to actually have brexit shortly. That was not obvious until we had our election last month, which resulted in a very clear victory for the conservatives under Boris Johnson<\/a> and therefore his ability to pass the brexit law through the parliament, which is now happening. At the end of january, britain will be out of the European Union<\/a>. There is a huge difference between being in and out. That is a huge change legally. It is not yet a big change on the ground. Through the end of this year, we still have a transition where the same rules and regulations apply. It is not a dramatic change. But there is the ambition to do a trade deal, a new treaty governing the future relationship between britain and its European Partners<\/a> by the end of the year, and that is a hugely ambitious goal. I dont think they are going to manage to achieve the comprehensive treaty that is sometimes talked about. There is still a lot of negotiation to be done. We will shortly have the divorce. How britain and the European Union<\/a> live together sidebyside, extremely integrated trading partners, how that happens, that is all still up for grabs. Host what does an updated u. S. U. K. Relationship like post brexit . Guest that is something the Trump Administration<\/a> has been making very encouraging noises about, how quickly it might happen. These things are complicated to negotiate. I think from the british perspective, once we are out of the European Union<\/a>, the relationship with u. S. Becomes all the more important. It has always been important. It becomes crucial. We are much more midatlantic once we are out than we were before. Host ivan is calling from texas on the republican line. Good morning. Caller if anybody likes the economy now, they need to vote for donald trump. The democrats already said they are going to triple our taxes just to pay for whatever they think donald trump has done. Then they call for wanting to charge donald trump for war crimes charges. I guess they forgot about george bush, Madeleine Albright<\/a>, condoleezza rice. They dont talk about that. Why dont we just turn these people over to the war tribunal and take care of this problem . The democrats need to get out of the way so this country can move on or move to a different country if they want to live in el salvador. Host do you see anyone on the democratic side making a compelling enough economic argument to defeat President Trump<\/a> . Guest i think the argument is one thing, but the state of the economy is another. How well people feel the economy is going. There is a potential for things to go wrong between now and the moment. The economy looks pretty strong. The American Consumer<\/a> is an extraordinarily potent and persistent player. There has been a resilience. This is already the longest expansion in u. S. History. At some point it will end, and there have been occasional worries. That will play into things as well. What is happening on the ground. On the question of the candidates, a lot will depend on appealing to those that dont feel they have benefited so much from the expansion the economy has had and this question of who gains and how it is distributed will be a big one. Host on page 39 of this edition of the economist, figuring out the 2020 race. What do historical statistics and current numbers say about the election . Guest the current data says the incumbent president starts with a big advantage. They tend to do well. If their Approval Ratings<\/a> are as low as Donald Trumps<\/a> have been, that makes you think this might be an exception. You can look at the statistics every which way and come up with different conclusions. The fact is there are still so many variables in this campaign that anyone who thinks they know which way it is going to go in november is probably fooling themselves. Host you are on with Daniel Franklin<\/a>. Good morning. Caller thank you very much. Thank you for having me on. Thank you for taking my questions. I have three quick points. I consider this should be front page news everywhere, but it is not. Currently, the central bank starting in september, late october, has pumped more money into the Financial System<\/a> than at any time since the great financial crisis, approximately 400 billion and counting. There is a perfect correlation with rising stocks and these qe measures the fed takes. It is almost a 100 correlation. I trade Financial Instruments<\/a> for a living, so i know something about this. I was curious why nobody is covering this, since it is so dramatic and out of the ordinary, and if i could just get one other quick point here. I consider the stock market a little bit of an inequality index. The vast majority of people dont own any stocks. There is a small majority that own 40,000, but the majority is owned by the 1 . This is the third asset bubble i have seen in my lifetime. These sort of things should be generational. It seems like we have Central Banks<\/a> that have lost their minds. They keep doing the same things over and over again, and the rich keep getting richer. The billionaires in this country had a 25 increase in their net wealth this year alone. That is a direct correlation with the stock market rise. If you could comment on those things, and i would like to say to the people out there, two Percent Inflation<\/a> mandate by the fed his a joke. 2 , you lose your purchasing power every 20 years by 50 . Boeing trading at a market multiple at 50 times earnings is ridiculous. If you look at the multiples on some of the stocks, they are like the dotcom bubble. Guest we were talking earlier about what could the democrats do to get purchase . You heard some of the arguments there. There are vast swaths of the population that are missing out on the benefits. On the question of the Central Banks<\/a>, i think this is somewhat removed from politics in that you do have independence from the central bank, and the u. S. Is not alone. Europeans are pumping lots of money into the economy. They still have largescale quantitative easing and even lower Interest Rates<\/a> than the u. S. There is an effort to keep this expansion going even though there are many people that feel they have not benefited. Host lets go to paul in virginia. Hes on the independent line. Hey, paul. Paul, you with us . Caller can you hear me . Host yes. Caller i have a different perspective from your texas republican, who is giving undue praise to mr. Trump. Republicano is giving undue praise to mr. Trump. You say the economy are strong, but isnt it true we are simply borrowing and deepening our debt and deficit . I mean, if you give me a credit card with no limit, i can provide a Pretty Good Party<\/a> for everybody. Basically debt and deficit, dont they equal a false positive economy . Guest yes, i think one of the Big Questions<\/a> is the building up that it will burst at some time. Politically, the big question would be would be what it burst before the election, or if it is going to burst, what happened afterwards . Justs not debt is not in the United States<\/a>. There are potential debt bubbles in many parts of the world. China is wrestling with a big question of debt. Will this explode or can it be managed . When might it happen . I think those are things that even economists struggle to predict properly. Thesen worry about bubbles developing, but you dont know whether they will burst or spell disaster. Danielur guest is franklin, executive and diplomatic editor with the economist. Guest i have been there 36 years. Host what have you learned over those 36 years . Guest particularly with the world that he military military is you give your best sense of whats going to come. But the world has a way of losing and string ways. Strange ways. Every year i look back at what did we get right and what did we get wrong . Well, andwe do very sometimes we do not so well. Whats interesting is where we messed up and why. Touch on the environment. Number six deals with sustainability. Tim is a definition. What is sustainability and why is this something we should Pay Attention<\/a> to . Guest i think it has come to be the buzzword to mean responsible behavior and a way of managing the planets resources in a way of trying to ensure the planet can carry on life on the planet as much as a has done in the past. The response has been for resources with a level of companies that are not spoiling the environment. Are treatingtizens the world around us with a degree of respect and leaving it in a fit state for the next generation. So, this year there will be a ony big global conference Climate Change<\/a> happening in glasgow. This is a time when countries are supposed to come together plansoduce their national for meeting the Paris Agreement<\/a> targets. Obviously the United States<\/a> pulled out of the Paris Agreement<\/a>, but the rest of the world is still trying to meet these targets. This is still something that is like that very seriously. Glasgow summit will be quite an important event. It will bring the world together. Also, there is a big conference on Similar International<\/a> gathering of biodiversity in china. What is interesting is that you are getting an increasing talk about sustainability and responsible behavior at the level of very large companies. You have Big American Companies<\/a> saying its not all about the value. Its also about other values, such as sustainability. You have a lot of pressure from below. Hunbergta finberg t is something we have seen over the years, a real demand for young people that something be done about the environment. The key question for 2020 is whether this is the government level or corporate level . Is this just talk or lip service . Setting a target to some distant date that is not truly serious. Host what do you make of the debate in the u. S. . We know we have strong voices in congress who are speaking about the environment on and off the president ial campaign trail. Does it mean for the future of those types of negation nations that the u. S. Is not part of negotiations that the u. S. Is not part of paris . Guest it is much more polarized here than it is elsewhere. If you come at it from outside it is particularly striking or you have a government that is taking a particular line and very skeptical line on Climate Change<\/a>. Pulling out of paris. Samehere there is not that degree. Most other countries are effort, thewith the aim of achieving these goals that were set in in paris a few years ago. I think the United States<\/a> having said that i think within the United States<\/a> itself, there are Different Things<\/a> going on. There is a lot going on on the climate front. There is the government and local governments doing a lot. Ofre is an awful lot innovation in the United States<\/a> thats clearly the forefront of this. Actually play a big part in making a difference to climate questions. Piece in fascinating this edition. Coming out of california on plant genetics and whether you wayd engineer plants in a that makes them absorb more and keep them from longer in a way that could make a difference at a global level in carbon emissions. Rachel is in South Carolina<\/a>, democratic caller. Good morning. Caller can you hear me . Good morning. I just want to make the point that if you look at the economic drivers here in the United States<\/a>, california, new york, massachusetts, those are all high regulation, high tax areas. They are the most productive economically. In fact, they heavily subsidize states, such as South Carolina<\/a> where we have low taxes and low regulation. I am just wondering while looking at this empirical evidence, how we continue to have this ideology about pack using regulations . Guest i think there is also a concern in some of the states that if you go too far with regulations you drive businesses away. So people are often wondering, for example, Silicon Valley<\/a> will continue on being a preeminent in innovation as it has been anduse of the high taxes the prospect in business that is perhaps driving some away from ratesrea and also tax that are driving some people away from new york. This is not a simple matter, but thatre absolutely right you can have significantly regulated economies that artists that are successful. If you look at the quality of life and those things in the world, the countries that tend to come ahead, they are often the nordic countries. Not white regulation countries, but they have a mixture of free willing and heavy intervention on employment policies. Host number seven on your list talks about the gulf. The large economic story. What is it about the gulf you are looking forward to . Ratherthe gulf is also a risky area of the world. We have seen that demonstrated last week. But one of the big events towards the end of the year is world expo that is happening in dubai. This is something that happens every five years. The last one was in milan. T was Great Success<\/a> they used it to attract lots of people to the event, but then to launch itself as a center for as aess and attractiveness place to come and invest. It has done extremely well. I think dubai is hoping to achieve something similar. There is a connected place essentially located. Its airlines and commerce is what they look to emphasize. I think that is the hope. But the security situation in the gulf has to let that happen smoothly. We will see where happens. Its diplomatically interesting. Israel does not have diplomatic relations necessary exhibiting man. Some of the poorest parts of the world are being helped at exhibits. The new his country among the poorest, south sedan will be there. And then the g20, this grouping biggest economies in the world, they are meeting in saudi arabia this year. Again, that is another reason that eyes will be am a gulf. Given the recent history with saudi arabia, the hypocrisies was saudi arabia, that could be awkward. And the relationship between iran and saudi arabia is being stopped right now. Host how is the u. S. Doing in terms of relation with those countries . Guest it has friendly relations but its divided. Hat is the issue very close relations with saudi arabia. Host will and michigan, republican. Will in michigan, republican. You are on the air. It seems like democrats are it does not matter what , right off thedo bat they just find some way to go and it looks like to me that he is working real hard for the country. He seems to be doing a lot more than what i have seen in the past. I am 73 years old. Excuse me. Think they are scared that they cannot be him out of reelections like that. They are trying to get him out of the picture before the election comes. Host ok. Guest i dont think they will succeed in getting him out of the picture before the election comes. Convicted in the senate because, for that to happen you in need an improbable number of republican senators to switch sides. That does not look likely at this moment. Host richard in monroe, oregon, good morning. Caller good morning. Thank you for having this program. I have a question for mr. Franklin. I am curious as to who the creditors are and what happens to them when this bursts . Guest i think if the bubble bursts than we are all in trouble. It would be a global problem. There are not any individual countries that will suffer. Host you talk about space of multiple missions to mars is coming years year. Guest this past year we had the anniversary of the lunar landing. 2020 we have a window of opportunity because of the way that the planets align for a mission to mars. Many countries are doing that. The europeans have a mission, is going to fly a helicopter on mars, which would be interesting when it actually reaches there. The uae has a mission and china does. Host what is the importance of mars and exploring it . Guest some people want to go to mars and send humans to mars. Some people have the idea of mars colonies. Finding out about more about this nearby planet. This you talk about tech year. Both highs and lows. What he watching out for intech . Attack division i mentioned the tech divisions geopolitically. A lot of excitement has happened. , lot of things coming our way drones that carry people. Looking very much futuristic. I think that is because the materials are light enough to make this possible. You have a few dedicated companies are ready to launch, and also some of the major carmakers are getting into the game. That is just going to be a fascinating headline. When you have so much going on in the area of medical technology with all that is becoming possible through editing genomes and increasingly that thezed medicine, individual medicines for individual patients will have dramatic human stories on that front. Host other certain countries in the world that may not have been so advanced intech, whether its medical or other, that are rising up . Guest china is the great riser. The extent that others outside china have become riseed that its going to and become supreme in certain key technologies. Whether it be quantum computing are Artificial Intelligence<\/a>. But i think nowadays, because of the spread of information and the ease of collaborating, its possible for small places to develop some quite dramatic technologies. You see it and some of the nordic a colonies nordic economies and in israel as well. Host its bill in franklin, independent collar. Caller i have two things to talk about. The first one is, Social Security<\/a>. Are always talking about raising taxes on the rich. Theead of raising taxes on rich, why doesnt everybody pay Social Security<\/a> . To an hundredp 17,000 you stop Social Security<\/a>. If they own lemonade that and everybody paid Social Security<\/a>, Social Security<\/a> would probably own a lot of money it takes in. Its have stopped talking about lowering the amount you are going to get an work until you are older. A stone mason cannot work until hes older, that mans body is worn out. My second point is, to help with the National Debt<\/a>, we should start a National Lottery<\/a>. Lotteryart a national you could have a few winners every day. I suspect it would take in 1 billion every 10 days after getting rid of all expenses. Have lily and day to win. Which would boost the economy tremendously because of the spending they would make and the people they would help with their businesses and things. Those are the two things i have. My other what the lottery i cannot explain it because of time, but its very easy to do. Host thank you for calling. A particular idea dealing with the Social Security<\/a> threshold in this country. More people, more money, what do you think of that . Guest i dont know an awful lot about the specifics of that. The National Lottery<\/a> question, there are countries that do have National Lottery<\/a> cement does not solve the debt problems. Aboutare many questions National Lottery<\/a> that confront some interesting stuff. We have a National Lottery<\/a> in britain and all the money goes to culture and sports. It does not solve the National Debt<\/a> problem. That thiss natural is front and center. If you were in britain this morning you probably would of moved on from brexit. Aboutld probably talked the royal family but people are concerned about the economy. Everywhere in the world people are concerned about the economy. Host you write there are big anniversaries coming up . Guest one is one that will get a lot of attention. Beethovens 2050th anniversary. Ifyou are a beethoven guest youre a beethoven fan if you are a Beethoven Faneuil<\/a> here more music. Its a lot to celebrate with beethoven memorabilia also. If the 200th anniversary of lawrence nightingale, who is very famous. And florence nightingales as a cue for the World Health Organization<\/a> to declare 2020. Nurses are among the most respected people in the world. I think there is a tremendous shortage of them. 50 years since the breakup of the beatles. Host 400 since the may fell tohost mayflower sailed the u. S. You type about a tour of entertainment coming online. We have seen a lot of this recently. Tell us more. Guest the golden era or in the quantity of content produced, this is aware of where this is playersng all the major piling in. Its not just happening in the area of television, its also in the gaming industry and streaming with having specialized gaming consoles. It will play out in different areas of the media industry. Im not sure how long it can go on for, but having so much investment in Companies Involved<\/a> has to be something of consolidation. The gets expensive if you have save to watch her favorite program. Now its a golden era of content. Host good morning. Caller good morning. I am delighted to speak to you mr. Franklin because i have been getting the economist magazine since i was since the 1980s. I started to go to the you a to buy and. I could read the magazine in its entirety by the time i got off the plane in boston, massachusetts. In threeer it intervals im 82. The last time i ordered it i thought, i was being so optimistic to order for another three years. I do like it, i read the whole thing. I am so happy to tell you that in person. Guest thank you. Theer i would like to tell republican man that the democrats only complain about a big obamaas supporter and i am telling you i thought the republicans complained an awful lot about him. Thank you so much. You do such a good job. Steve is in norwalk, connecticut. Independent collar. This gentleman used the word if the bubble breaks. That is ridiculous. Every bubble breaks. Right now we are in a bubble. He has no clue, but we are in a bubble. Yesterday the market went up and made a new high. It was very timid and turned around and dropped. Was not a key reversal because you need a real wild were people are just going in and out in the up andwith it moving down before it actually tops out. Man is really the most dangerous person on the planet. That would say that if the bubble breaks. Imnt to tell you that going to be the candidate for the Libertarian Party<\/a> to be president of the United States<\/a>. I read the book when it was published in october called reparations preventing me and i liege and from co2 annihilation from co2 with a power cell system. You never hear the words nitrogen mentioned at any time talking about this miraculous disaster that we have in australia. Burning everything in sight. What we had in the west coast, andng everything in sight these huge hurricanes or have been getting much, much worse. I was a victim of sandy appearing connecticut. That was no fun. My lights were only out for three days. That wantede people just placate everybody and its all going to work out and they are going to capture co2, which is impossible. And then store it, which is idiotic on its face. Instead of going to hydrogen, that has no co2, why would you. Ven think of storing co2 its just nonsensically crazy, because its impossible. When you could go to hydrogen. Going to be completely annihilated, i dont think the money means anything. It would be much, much more cheaper. If you think about it, it if you were really able to capture co2, it would be an airless process. When would you stop . You cant. Would you rather have some money spent of front changing the entire system to hydrogen and be done with it, or go on forever thinking that you could actually capture co2 . These are such dangerous things. Of course the bubble is going to break. Just a term and the moderators sat there and just let you go by. Guest you did not let it go by host you did not let it go by, you asked about it. Guest i am far from suggesting upt the markets go up and and there has been an end to the business cycle. Clearly that will be a downturn. I think there is a question to how severe that disruption is when it comes. Do we have a traumatic, terrible life like we had in 2008, 2009. And we have a really extraordinary disruption to the economy, or is it something that is more traditional and more familiar . Ofont think its the end the business cycle, but there is a big difference between a traumatic bursting of a smoother letting out of the air. Host i should get your take on whats happening in australia. Guest terrible. Says, aboriginal warrants fire safety problems in the country. Guest it is absolutely right. Thing, dramatic climate developments are happening at bigger frequencies around the world. I think its getting into peoples consciousness and developing a sense that its time to do something more dramatic to try to make sure that we reverse these trends. Host in those actions will take huge amounts of money. Guest yes, its not simple and there are lots of big ideas out there. That is precisely why it is theseant that they had efforts to come together, share ideas and try to set Ambitious Goals<\/a> and do something about it. Host one of the most interesting facts i found in this whole issue, the economist, is out for the first time the world will have more people aged over 30 than under 30. Why is this an important statistic . This is short for young old. Whereentering the decade there are people aged between 65 and 75, the baby boomers moving into that bracket and doing so into record numbers. They are young old because they are on the healthier, richer, more active than any previous cohort at that age. Make a very, very big difference to shake up labor markets are consumer markets because they will be spending money. They will be an important demographic. And this is an important age group than millennials. The young, young old will be extremely influential. Host your final thoughts on 2020 . Guest jess that entering 2020 is making people think bigger bigger thoughts and what this decade will be like. I think that there is a sense that both excitement and concern is there about what 2020 will bring. Diplomatic editor for the economist. Thank you for your time. We covered a variety of topics. Thank you. The house will be in order. For 40 years, cspan has been providing america unfiltered coverage of congress, the white house, the Supreme Court<\/a> and Public Policy<\/a> events from washington, d. C. And around the countrys the you can make up your mind. Created by cable in 1979. Cspan is brought to you by your local cable or satellite provider. Cspan, your unfiltered cspan,g up tonight on next, 2020 democratic president ial candidate andrew yang talks to voters out of town hall event in bedford, new hampshire. Then republican whip Steve Scalise<\/a> and steny hoyer discuss what actions the house will take followings following speaker sendis decision to articles of impeachment to the senate. After that, former secretary of state Madeleine Albright<\/a> shares her thoughts on strengthening government in fragile states. [indiscernible voices] ok. How are you doing today . Good. 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