>> welcome to "bloomberg businessweek." i am carol massar. iconic companies tackling our global macro concerns. combatinge ceo on global warming. then we have the global cover story. president trump's government

shutdown. jason: how it is redefining politics. carol: what is interesting about your story, this shutdown is different from what we have seen in the past. been covering washington politics for years. there have been 10 government shutdown since 1980. this is the first one engineered by the president himself. that has created a set of circumstances and explain why things are so contentious, why it has dragged on for so long, and why there is no end in sight as we enter month to of the crisis. take us back to the prologue, the famous meeting in the oval office, and the president says i will loan this, this is my shutdown. does he regret that? >> i think what happened is trump planned ache confrontation -- planned a confrontation. -- the problem is he

got caught in a bickering match responsibility for the crisis in advance before it kicked off. that is the worst thing you could do from a strategic standpoint. the minute the government shutdown, the question that is asked is who is to blame and trump has taken that in advance. one problem we have had is there is no easy way out of the crisis because trump does not want that blame. he is saying there is a crisis, but at the same time trump is the president, he has been able to mitigate the nastier effects of the crisis. he is in a strange division where he cannot go on but it is not clear how it will be resolved. it comesat about when to perception, and the constituents, whether democrat or republican. who is losing? everybody is losing. what is interesting about this shutdown as opposed to ones in

the past, it was congress that shut down the government. last spring the government try to get progress on daca. ted cruz try to shut down the government and block obamacare. the problem is that the president can turn around and exacerbate the pain from the shutdown. obama closed national parks, and commodity prices were not available for. it caused a lot of disruption. republicans could not withstand the pressure. trump has done the opposite, he is using the presidential power to mitigate the effects. when it became clear the irs cannot process tax returns, trump ordered 46,000 irs workers back to work. we are lacking the forcing mechanism that has ended every shutdown in the past before now. it is not clear what that mechanism will be. pressureu talked about

on republicans, and it does feel like in the senate, that does feel like the most vulnerable group to some extent. . handful up for reelection mitch mcconnell has come back onto the scene in the past few days. what happens there? does this rest on the senate? .> it does rest on the senate the other thing different from previous ones is that in the past, usually the broad middle of the country has turned against the party that orchestrated the president. this time it has not happened. trumps favorability has gone up amongst republicans. that is a fact that republicans are rushing to their teams. republicans in the senate are stuck. they do not want to go against trump or voters. there are few like cory gardner from colorado, lisa murkowski from alaska who are up for reelection and need to get the government open. we see movement but not enough

to break the dam. carol: i wonder, are we getting another page from president playbook, if he does not get his wall, will it come up in a few months with the debt ceiling? >> this is the scary scenario. trump is in this for one reason alone, get money for his border wall so he can run for election saying i said i would build the wall and i am. if you is forced into a humiliating climb down, i flash forward six months to a scenario where the debt limit is about to be reinstated, treasury can pursue extraordinary measures, but if the u.s. is running out of borrowing power, i do not see anything from stopping trump to take the debt limit hostage and say if you do not give me money for the wall, i will not raise the debt limit. that is more scary than anything we have seen. jason: another way to look at the shutdown is how it is

impacting consumer confidence. we pulled up a chart that breaks it down, and it is clear. carol: what we are seeing is americans are not confident, and it is falling to a two year low, the lowest we have seen in trumps presidency. consumer confidence, wages, job prospects, but the continued uncertainty has really weighed on people. drop: you see that sharp their. the government shutdown started then, there was worry about it, but it has gone on and on. carol: it is one for the record books. coming up next, how global companies are faring in the face of the u.s. china trade war. jason: our conversation with a pioneer of equities who says what americans get wrong about beijing. carol: this is bloomberg businessweek.

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carol: welcome back to "bloomberg businessweek." i am carol massar. jason: i am jason kelly. catch up on our show on our podcast at itunes carol:. carol:you can find us online at businessweek.com and our mobile app. the economic section is all about china. jason: specifically the risks and rewards with beijing. carol: check out this chart. it shows you how important china is to many of the world's

biggest companies, and what you see, look at apple, boeing, procter & gamble, huge multinational companies. the dark part is revenue from the rest of the world. the white part shows you the revenue coming from china. apple alone, $52 billion. jason: earlier this month, that news about apple's exposure to china being responsible for its revenue shortfall, that had a huge impact on the market, and it raised the question and turn the tables in terms of what your exposure to china meant. carol: china has always been the market everybody has been looking to to grow their topline. jason: we have more from our economic editor. >> it seems a good time to look at it because the country accounts for 16% of world growth . back in the late 1990's when a

lot of conversations began around this question, it was 3%. it was of academic interest if china was cooking the books. in thisg happened latest quarter that was interesting, which was for the first time in a long time the official figures aligned with this big range of independent processes including at banks have been devising and working on for many years. , and ittion now remains cannot be answered yet, whether china has turned a new leaf, or whether this is an anomaly. jason: i do not want to get too far away, the market decided it had to, with its own figures because it could not trust with the chinese were saying. to get what look at

they think is a more accurate number? >> it is a huge cottage industry. the irony is it was a most mment fromby a co a chinese official with a u.s. diplomat who said china's gdp numbers are man-made. and he said, i look at things like electricity consumption and bank loans to gauge what the activity in my provinces. people quickly, the economists made with they made the leak account index from those metrics . bloomberg looks at an index of electricity consumption across a number of industries weighed by their share of gdp. important an industrial production, retail sales, all the things you would expect people to look at in a normal economy.

often used to gauge the level of activity. carol: it is interesting this went into the history of how statistics have been gathered in china. talk about the difference between what local leaders have to worry about the data and national leaders. jason: and the incentives are perverse. >> understanding incentives would be why china would stop doing this. it used to be from the era of m ao, local officials were reporting figures to beijing. because your was prospect of promotion were tied to your performance of the local economy, the incentive existed to inflate the level of economic activity. back.e that looking

you wonder, did china ever grow at 14%? jason: for another perspective we caught up with the ceo in china. carol: his personal story is riveting, hard labor in the gobi desert at 15, two attending school in the united states and becoming a private equity investor, overseeing billions of dollars in investment. jason: he writes that in his book, "out of the gobi." him on our daily radio show, and we wanted to bring him back because there is so much insight he provides. jason: he started talking about the trade war between washington and beijing. >> i think reflecting back on the 40 years of this relationship, both countries have benefited from this relationship. ago thed find 40 years

differences between the two countries in terms of the system, the economy, the it could not be as different, more different. they are complete be different worlds. at that time when richard nixon first visited in 1972, they found some common ground, common interests to establish a relationship which was formalized. since then, the relationship flourished. those countries are the largest trading partners. i think of course if we look at the differences today, they are ago.er than 40 years china has opened up, it is a market economy.

the private sector is the largest part of the economy. there are more commonalities between these two countries. if they look at the common ground, the common interest, the focus on those, and not on differences, then this relationship will continue to develop. carol: tell me about this book and why you wrote it. >> as the title suggests, "out about gobi" is my story china and america, my experiences living through the most horrific part of chinese modern history. i think my stories are rather unique, but they are also representative of the people in my generation who lived through similar experiences. carol: talk about growing up in china as a kid. when i was a small child, i

,hink my life was more normal even though china was a poor country and we lived in a poor standard and conditions. carol: you grew up in -- >> beijing. hell broke loose in 1966 when i was 12 years old and fishing elementary school. the so-called cultural revolution started and the entire country was thrown into chaos. the president was thrown into jail without anybody knowing about it. he died there three years later. any teachers including mine were beaten up by students, i witnessed teachers the the death by their students. it was totally chaotic. three years later, after three years of total chaos, i and many of my friends were sent to the gobi desert to do hard labor.

when i was 15 years old, it was extremely hard work. and in very back conditions. and we did not have enough to eat. we had to work 16 to 18 hours a day. the worst thing was there was no education, so we were out of school. for the next 10 years there was no schooling. this generation of mine is referred to ask the lost generation because we never had a chance to acquire formal education. jason: up next, while japan sets its sights on flying cars -- carol: we are still trying to figure out safety concerns. jason: this is "bloomberg businessweek." ♪

jason: welcome back to "bloomberg businessweek." i am jason kelly. carol: i am carol massar. jason: in the technology section, japan does not want to fall behind the technological curve. carol: it is very important that the ministry of trade is working to speed up the arrival of aerial taxis, flying cars. jason: flying cars. >> we have talked a little bit about it the last couple years the efforts in the u.s. and elsewhere to make fantastic machines of the future a reality, including larry page, the google founder. but japan over the last few started to take an earnest approach on a governmental level.

they are calling an old-school moonshot, saying in a next 10 years we will get from a standing start to air taxis and trucks. japan in terms of a high tech universe and who is doing what, i love the story that says japan uses foot phones, and yahoo! is the most popular internet service. they have kind of fallen behind when it comes to high-tech. yes, and particularly this kind of technology, japan is an unlikely source of this moonshot effort. say ups that writers front they are stuck in yesterday's vision of tomorrow, the 1980's idea of the future. carol: what is their plan? >> japan's ministry is one of

the lead actors here, and in operation that was in the era of the post economic miracle for having come up with the radio, the walkman, but it has been quiet since. here is the government saying in the last year, we are going to make an effort to grease the skids and rolled together private startup efforts in venture capital. jason: you highlight a couple people who have come across as voices shouting in the wilderness, saying, this is our opportunity. these young guys to a large extent who were running up against the bureaucracy. they may be a little skeptical. what broke through? >> there are plenty of headwinds. it is hards the fact

to do anything quickly in japan. whereore so in the u.s. western societies are safe. there has not been the kind of serious error accident or real accident you will see -- air accident or rail accident. it has been a challenge for people on the cutting edge of flying car industry to work their way through the various government bureaucracies in play here. nonetheless, the government allowed last month the test flight of a flying car by a startup group. carol: now we go to singapore for a look at how ride-hailing apps are getting drivers? . jason: what these companies are

doing to protect passengers from negligent drivers. our technology reporter in singapore has been covering the rideshare industry. story, to us with this on the day uber and grab which is the dominant player in singapore, grab the local champion becoming the acquiring company in that market, got in a grab car and was in a terrible accident. ,he weird confluence of events writing about this fast growing company, and nearly dying in this car crash. one of the arteries that was severed, she was in the hospital for days. it cause her as she recovered to try to think about whether or not the fact of these ride-hailing companies that are growing so fast they have added

thousands of new drivers to the roads, may have contributed to the accident. she had an unique opportunity to investigate because she was able to get her own accident records, in singapore there is a law that allows you if you are part of the accident to get the records. but also to get to know the ceo of grab. he is one of the most famous entrepreneurs in southeast asia, and so she was able to get unusual access to him because he started visiting her. carol: he came to the hospital? >> yes, so grab is different from uber. , theyresented themselves are a sober law-abiding company. christian, and into displays of his faith and seriousness and sobriety.

combination, after a reporter was in the hospital, he started showing up. you have to read the story to understand what she was going through. it comes off as too much. and you wonder, the subtext of the story is there is a protest too much quality about the grab response. we should say, she did not find anything about grab doing anything wrong. the company apologized to her. the ceo apologized to her. it is more a question of are they giving safety records, are they being honest with themselves about what they are doing to ensure safety? jason: up next and insider look at how angela merkel's power faded away in germany. carol: what brexit can mean for small business owners and entrepreneurs across the u.k.

jason: this is "bloomberg businessweek." ♪

>> welcome back. ahead, while you probably cannot sue your boss. jason: and then something a little different. snails, cider, and cool sneakers. we start in the politics

section with angela merkel, topping the list of world leaders at the world economic forum. ,ason: for dominance in davos berlin, and europe is coming to an end. carol: changing times, our reporter tells us what happens to her once firm rick -- grip. has two years to go, but she is seen as a lame duck. everybody knows she will not run again and has already named her possible successor whose name is very difficult. carol: like you said, it is very foreign to us. it is a very different system. but tell us how angela merkel kind of lost it. you take us to a day in 2018, june 12, what happened? while she was still seen as a very powerful and dominant

abroad and in germany, beginning with the refugee crisis, she actually lost a lot of confidence here. was the firstjune time that her own parliamentary group, her own people openly revolted against her and nobody defended her. jason: and why? as you say, this was over the refugee crisis. she took a step, and keep us honest here, that was maybe unexpected, or certainly not politically palatable to even people in her own party. >> exactly. many people were taken by surprise because she was known as a pragmatic politician who always thought about the consequences of her policy. suddenly, she asked very emotionally, people have the feeling. it left many people here without

knowing what is coming, and especially for conservatives, that was a very hard issue to follow. and this is all happening against the backdrop of a very different europe both in dealing with itself and the union and the rest of the world. how does angela merkel find herself with this new leadership across europe and the united states and elsewhere? >> she was a celebrated as like the last leader of the free world. a name which she herself never really liked. now, she sees that she is like one of the few leaders left seems to actually have human values in mind when they make decisions. multilaterally, together

with emmanuel macron. of course, she feels pretty lonely right now, on the world stage. jason: and while she has lost support a must for people, so too has her counterpart in the u.k., theresa may. she is continuing to work out a plan for brexit. carol: lawmakers are scheduled to vote this week. for an understanding of how the uncertainty is impacting businesses, we caught up with an entrepreneur. >> it impacts every business owner and everyone who says it doesn't is not -- it does, in some way. i am heartbroken, because these are people's lives. when somebody gets a job, it affects them and their family, but that job affects the community in which they live, the city, and eventually, the country. and that is what we are seeing, a slowdown in the economy.

instance,tmas, for you saw things going on sale way before christmas. how do you catch up with that? how do you have people sitting there waiting for the 70% discount, and that really hurts retailers are at is why we're seeing shops empty on the high street, what do we do with the? -- with that? down,on't want to talk us as an entrepreneur, because we pick up the pieces and build up things. this christmas, we work three times harder for every pound that we made, but we did. the next six months are much easier than some of the other retailers who are our neighbors. but there will always be a place in the market for retail, brexit will not stop that, but it is making it really hard. , nobodye uncertainty knows what is happening.

i like to think of myself as a savvy person, i don't know what will happen today, let alone tomorrow. so how am i supposed to invest in my business? carol: make decisions. >> make decisions. am i supposed to sign that lease, higher these people? people?these they don't have lawyers, advisors, they need to know where they are going. when you sign a lease and a business, it is a commitment to yourself, the community, and the people you employ. next, the ceo of mars, the teddy barking, sits down with bloomberg -- the candybar king sits down with bloomberg. and a wall street arbitration hearing thanks to documents links to bloomberg news. carol: this is bloomberg: businessweek. ♪

jason: welcome back. carol: join us for bloomberg: businessweek every day on the radio from two-5 p.m. wall street time and you can check out on our daily show. us online atnd businessweek.com and our mobile app. week, a ceo this sits down with joel weber. carol: the company is known for their suites, and there is so much more. >> mars is really interesting. privately held, family-owned. global, right? revenue.$35 billion of jason: and these are brands that everybody -- >> everybody knows these brands! there is this just position because everybody knows these brands, yet nobody talks about

the. these are brands like mars, m&ms, skittles. a minute, we were all talking about healthy snacks in big sugar, but he did not seem to back away. >> they view it as a treat. you should only view confectionery's and candy products as treats, they're not supposed to be something to eat all the time. but they do see an opportunity in nutrition, and that is what they talked about, they have a partnership in india with ta-ta 's. there is a malnutrition problem, and they see an opportunity to solve the problem for the world. another thing we talked about was sustainability. i framed it around this idea of you have a candy bar and he threw away the wrapper, or you can recycle the wrapper. that was a challenge she talked about, and they talk about it a lot. if you look at the oceans with

all of this plastic, what are you going to do about that? jason: here is what the ceo had to say about sustainability and global warming. we are basically an agricultural company making agricultural products, fish, corn,:, and we turn into brands -- cocoa, and we turn it into brands. so we are very dependent on farmers. climate change is real and we believe in pertaining to the paris climate agreement. initially, when we look at our operations, we look at just our own operation. we have done some great stuff, zero waste to landfill, renewable energy to color -- cover all of our electricity needs in the u.s., mexico, soon to be australia. that theealized

metrics indicate ability to examine that are more complete, and then that is only a small part of the impact that we have. and in the food supply chain has a greenhouse gas emission equivalent to somewhere like panama that is where we really have to play our part. we are working with cocoa ,armers in cote d'ivoire another great example of what we are doing as part of a collaboration. part of our fund in madagascar with vanilla. we're looking to our partners for ways to help them improve all -- productivity to manage the effects that come with the change. carol: in the features section, what it is like to go through arbitration. jason: millions of american

workers sign away rights without even knowing. >> people familiar with arbitration, maybe they have a sense it has to do with unions, maybe as a consumer you sent arbitration agreements. but what makes the story cool is that it is really a story about workers, american workers. you and i are both workers. >> right. >> what the american worker has done in the last 30 years is lose what feels like a fundamental right, that is a right to sue your boss in court should something go wrong. that means something along the lines of sexual harassment or discrimination, or you feel cheated. , if that happens them, they will be in this quiet, shadow system. the crazy thing is that nobody really knows what it looks like, and that is what the story -- why the story is excited.

carol: what is fun is that you do take us behind the scenes of what goes on when there is an arbitration case. >> yes. i don't want the audience watching to think "ugh, arbitration, boring." it is a fun story because it has got a real tale. carol: you call it "welcome to arbitration hell." >> that's a good headline, i did not write the headline. there is a guy named alex bagel man -- bagelman. guy, from the ukraine, and he was laid off by ubs, biggest bank in switzerland. he was a tech guy, a senior tech guy. he found out when he got laid off that he was not even going to get his bonus which he was days away from getting, it was around january. not only that, but they were basically like if you want your

is,rred commendation, which of course, economy money that comes in with a built in timer. he thought he had all of this coming his way and ubs said you wanted, please sign this peace of paper which says he will not fight us. and he decided not to do that. carol: so we are talking hundreds of thousands of dollars. >> over $1 million, essentially. he did two things, he took them to arbitration. the second thing he did was he basically felt that his arbitration clause had a loophole that would allow him to file a class action, which is like when you team up with someone else. the supreme court recently ruled that, basically, employers can get out of class action lawsuits thanks to arbitration clauses. so let's not worry about that fight. instead, after the arbitration was over, i got a call from his lawyer, linda friedman, an iconic labor and civil rights

attorney. she said i'm just going to send you the transcripts. carol: you got the transcripts. >> i got the transcripts. let me tell you, it is hard to get transcripts for arbitration sessions. in a court case, if you and i decided to take a five day off and see court cases, you can walk in. you can walk into el chapo's case. arbitration -- carol: it is private, it's by its nature. >> it is private. it is secretive, more shadowy. not necessarily more confidential, but from the outside, you know a lot less. the me too movement has emphasize arbitration because it keeps claims quite. carol: up next, rebooting a communist sneaker. jason: and eating like a king even outside of new york and helen. l.a.nd carol: this is bloomberg:

businessweek. ♪

carol: welcome back to bloomberg: businessweek. jason: you can listen to us also on the radio in new york, boston, washington, dc -- carol: in the bay area, over in london, and of course, and -- on our app. this week's business section is focused on small businesses. jason: focusing on sneakers, of course. , i'm not sure how to describe them. a classic style, a combo of a bowling shoe and a soccer shoe. not to draw comparisons, but i will, some people say they look like campers, but they are kind of cooler. they have stripes, they are leather. these were very popular in east

germany before the fall of the wall. kind of competing with the likes of, and adidas -- of puma and adidas. went away, because when they were open to all kinds of products after the fall, people were like why would i need these? carol: how did they come back? i am always curious. >> one of the three investors now was somewhere and noticed a friend of his wearing a pair. he recognized them because he grew up in east germany and was like, wait a second, those look familiar. he was intrigued, so he started looking into what had happened. so on and so forth. he decided he would do this, against the advice of some people. he found a cobbler who would work for the original company and he was like, you're crazy. all these brands of footwear and

sneakers, they've always been competitive. >> we think of them as having been a big deal now, but it has always been competitive. people want the coolest, the latest, where is it coming from, whatever the cachet. -- cache. carol: from sneakers to killers nails, i have no better segue. tell us about killer snails. >> it is a company founded in boston by three women and is about science, education, and trying to get kids and teenagers excited about science. when the founders of the company, who came together in various ways, would talk about what was going on with science and science education, they were seeing trend is that were very troubling in terms of not enough young people pursuing careers. they thought they had to find a way to excite kids. what we wanted to do with this when one of our

contributors met one of these was talking how a lot is based on their testing and piloting, it is all about that. you don't create a product for kids and middle schoolers. if you don't find a way to tap into that audience and see how something works. , what he is doing is identifying parts of the business that might be challenging that you might have questions about. curry, bring steph it all home. >> we just thought we would do something funny here. there is nothing official behind what we positive and what the what -- what we posit or the owner posits. california andrn does quite well when the golden state warriors do quite well.

when we looked at the timeline and the history of the company, compared to something like when where the warriors in the playoffs, when did steph curry sign? we thought this was a fun way to bring this all together. it is an old family business that was an apple orchard that simply sold apples, but that wasn't not enough to cut in the very pricey sonoma region where more and more of the land started selling for more and more, 5-10 years ago, especially because of pinot noir. they pivoted and decided they would take what we have, which is apples, and we will create hard cider. there wasn't much happening with cider at the time when this happened around 2015, but right after that, cider started taking off and moving -- booming. jason: a foodie's guide to the best restaurants outside of new york and los angeles.

the best eats in second the cities. >> second cities are cities that have been overshadowed by their neighbors. maybe in everything, but from where i sit, the food in the cities that sit a couple hours away from their better-known neighbors have been getting all the headlines. now we are seeing the emergence of these cool cities that now you want to go to maybe even more. carol: i love it, and i have say, reading through this i thought i wanted to go to philadelphia. >> you totally want to go. the funny conceit is that 10 years ago, you never would've thought manhattan real estate would advertise its proximity to queen. i'm a new yorker, never ever in my lifetime. likewise, you would never say let's go to philadelphia to eat anything besides a cheesesteak. , therehas really changed

has been a critical mass of chefs who have set up shop there, and the food scene is so good i think it is threatening new york, and i say that as a native new yorker. about other talk cities, because you also talk about san antonio and minneapolis. >> let's talk san antonio, because austin has been in the foodie world. , ands been the darling about an hour and a half away, san antonio was known more as the birthplace of chile carne.te -- chili con about a decade ago, this place called the pearl was created and it is this mix of a food space and a brewery. it is anchored by this gorgeous old building, and now there are 19 food and drink concepts in his -- in it. indianapolis, minneapolis. is cool,k indianapolis

because who would have ever thought? they have actually build up this really cool food scene, and the city has been really good about creating parks and pads and walkways that take you from one food area to another. foras sort of helped drive traffic, literally drive foot traffic. d.c., i think about richmond, though, right outside the sea. d.c.outside >> richmond has this fantastic beer scene and is ranked one of the best year cities in the world. hand in hand, when craft beer starts coming up, you see restaurants developing as well. they know something called the boomerang affect, where chefs who work there or who started there went away to make their name in a place like new york city, but now they are going

back and establishing their own places and getting recognition across the country, which is great. bloomberg: businessweek is available on newsstands about. jason: also available online and our mobile app. what is your must-read? carol: it is yours as well, the cover story, the global cover story. we love when we get chance to be -- to read something written by josh green. we have an idea of how the shutdown is different. jason: and he puts it in such great perspective, because his expertise goes back decades. he wrote the book "the devils bargain." he understands the administration and what makes the president tech. -- tick. it is a whole new ballgame, and as he says, it is a shutdown like no other. carol: check it out, and you can also find more stories online over the weekend. jason: and check out our podcast.

carol: more bloomberg television starts right now. ♪

i am a family man. i am a techie dad. i believe the best technology should feel effortless. like magic. at comcast, it's my job to develop, apps and tools that simplify your experience. my name is mike, i'm in product development at comcast. we're working to make things simple, easy and awesome. ♪

>> i'm emily chang and this is the best of bloomberg technology , where we bring you all of our best interviews from the week. earnings season is in full swing with ibm and delivering a strong results. does it signal a bullish order for tech? davos,kes a splash at giving new details about the self driving cars. we bring you our highlights with their ceo. and netflix's hollywood m