>> welcome. i'm here at the institute for international affairinternationo this special talk on a new and timely work by my friend and colleague and his co-author we are joined here today by the director of the institute for economic finance and also the professor of international economics and political science at international and public affairs. we are going to chat for 20 or 25 minutes or so but then we would love to take questions from you all in the audience in fact if you have a lot of questions, we will cut the chat and go right to your questions.

for those of you joining us it would be great if you could write your questions in the q and a box and we will monitor those. for those of you joining just write your question in the comments section and those will get to us and please start writing those now if you had the pleasure and privilege of reading the book. let's get started. i love this book. it's provocative and fascinating. you mentioned in the book the work is intended to restore economics over anger. what does that mean? >> we figured out how the world

works. it becomes part of the process. what we have is a world that seems to be making more and more people angry and the motivation the world has never been better. we should be able to do more things and we see people now the tea party would begin with the black lives matter protest.

all of that so our challenge was why we picked this up as a subject. >> we know there's a lot of angry miss out there but the point that it's motivating people to behave in ways that are not economically sound, how has it changed what we understand in the economics? >> there's an analogy that we was in the book.

they are arranged in different ways every country has a capital market or labor market but they are different from each other. the economic ideas that are run on hardware and it's to accumulate the software. that's when people get annoyed because you can't do your work anymore. it creates these outpourings and what we do is try to trace the macro and micro level. the interest of the majority is still the feeling.

basically there's a bunch of insiders and everyone else is working harder. that is basically what we want is to be taken more seriously. we try to make sense of the different anger. >> the way that i understood the book was crisis is important. there's something that builds up so the way that i read it was to say over long periods of time a kind of disconnect happens. there are these experts that push certain kinds of paradigms for understanding the way the world works so there's this dominant paradigm and i think

your point is as smart as the experts are or think they are they are just wrong and people know that but they say that's bs and it isn't right. you could view that as expert hubris but then there's this other thing you've referred to which is out and out whether financially or politically tell me how am i supposed to make sense of those long-term trends of just bad ideas that the experts were not smart enough to figure out what's have both simultaneously this is

interesting because we hint at this. we tend to think about it this way it's our software for running the economy at a moment in time. so all of the ideas that come out is reflected in that moment so what expense. there is morthere's more about d involved in the changes. if it is released it is like a volatility concern then who gets to weaponize and we are in a

particular moment its created this to go in and weaponize in a way we haven't seen before. it's no longer really running. the metric of the expert it's a totally different thing and at the same time it's possible now in a way that it wasn't before.

let me push a little bit more on why i think it's important even though they are intertwined. i think about myself in the 1980s, '90s we grew up in a liberal moment and with regards to my political views i nodded accordingly when i was told the markets are the most equitable way and it's better to deregulate and globalization is good. all the while that was going on, there was all this other evidence about the process, the wage stagnation in the middle and all these people suffering and i guess i heard that but still saying in the end it's all going to work out. maybe i'm an idiot but that is a mistake of hubris and then the

idea we need new paradigms or people but you could see change coming through better ideas but fundamentally if the problem is the norms of leadership on the left and right had been taught and it's all about self-dealing, that's revolution and regime change rather than a different textbook. i know that they are intertwined but where did you find this issue today? >> think about the process going on these are claims for the moral outrage. we do not apply the law equally. another way rather than the

hubris there is a natural human tendency we see this in politics and also economics and everything else. i still defend parts of the argument but it doesn't mean the whole thing is wrong. that effect is combined with the issues to produce a world of uncertainty let me restate to make sure that i've got it. there's a bunch of bad ideas out

there that have been obsoleted before people in power recognized that and because they respond, that creates this opening for in your words, tribal identity and that kind of anger to be used as a technology that some people would weaponize this while the experts sort of respond and you get the moment we are in today. >> it isn't just manufacturing in the sense people are responding. you watch the american media when you have the lockdown process very few so there was a

study that said 40% of americans could be even more. we have probably 400 to go. we will buy everything. who is seeing the cost and who doesn't and it's been partially weaponize to but we also hope to acknowledge. i'm the first to admit that i've been tone deaf. but in 2009 or the financial crisis again in the early part

of the obama administration it seemed nothing was being done putatively against the banks so nothing happened. it made me nuts with anger so it does say to me that this is a fairly extended process. >> people pick up different bits of the information it's not the establishment or you end up in a world with basically the old mantra. i don't think they thought let's make that a policy bargain but that's the way that it ended up

in those two sets of rules. it's essentially the system we have been running for the past decade and a half. >> i don't know how deeply we would want to go into this but also race in the american story. although arguably it's the international context of race that uses a lot of this discussion about rage and anger and about two weeks ago the system issued a study and looked

out well for basically other liabilities. essentially $247,000 a year you do not get those types of any qualitieinequalities unless youe serious institutions pushing things in this direction like access to credit this is a particular form of anger and moral outrage there's a number

of interesting proposals i guess we will call them policy proposals for national wealth i think they are quite novel and provocative and persuasive in many respects. but how would that play out against what you just said to be filtered through race and other kinds of bias that still lead to important parts of the population not benefiting it's basically for everybody that's interested in the dialogue we

then got a series to transcribe it it's like telling everybody all the solutions and we know it's going on but the proposals are kind of taken inside the beltway. the other side but the last good

thing they can point to if you are going to see a new deal in a sense when i attempted to do this it is to describe in as mutual way as possible the policies are not based on the real difference to the affect to the crew and overall lifetime but also likely. there's no point in even saying

them i want to say how the proposals, whether it's for the interest rates were national wealth fund, direct transfers to household income how are those translated to a new kind of politics and this may have to do with with the idea of politics is but one view is people vote their pocketbooks but people want to feel something. we want our dignity reaffirmed. i want to feel something. you're plaintiff i've got it right is we are locked into this politics of either these answers people don't want to hear the

wrong xenophobic identity so what is the kind of new politics that is going to reshape those that are currently existing in so many societies? >> [inaudible] without getting too much into the issue if you invest in stocks every time there's a financial crisis, the cost of capital was negative and they dump all their equity. why don't we just issue more

bonds miles away from the politics. if there was 20% of the u.s. gdp you would have a multi trillion dollar given to people for college or reforming healthcare, it could make a difference. it's doing it in such a way you create an institution will with support and that is how you engender the politics people can basically see the real assets in and of themselves.

that makes sense if there are these kinds of transfers i would think that if there is a sense of solidarity in society, then i would feel this is great. i'm really happy that this is happening. if there are these tribal identities, i would say that poor guy, he or she is lazy. or that welfare mom should of course when it was deployed in the politic versus what i would hope for as a more solidarity take on citizenship. part of the problem is that concept essentially you are a

consumer rather than you are a citizen. when was it across that these type of reactionary there's basically 94. that is literally the only one and all didn't pay the taxes. when you change the amount of money i and people's progress it works wonders.

really change the society some people will definitely gain their interest but the majority benefit when i look at the opinion polls it seems it was a combination of the majority in the process [inaudible]

equity and access and justice and dignity. we have a lot of questions from the audience so let's turn to them if that's okay with you. your 500 year cycle going on are we living at a time when we are due for a massive reset because the paradigms revealed the limitations. they start declaring and i can

draw through any data. this analysis is a kind of mia cope's for wha us for what we'vd if you look at the shareholder values and other big senior funds we want to edge towards a solution because we understand the wealth gathering strategies. i was going to follow up but you got me going now what's the

trajectory from the previous booked the anger is tha it the change due to the factors or what are the most important factors that lead you from writing the previous booked to this book? most of what we think is outside of the financial crisis we didn't really change anything and basically said everything is fine. it basically the quantitative

easing so when we started to see the outpour a rather broad question whether or not for which conditions should anger be productive? >> that is a good one. an example came from an analysis and the one thing that came up all the time. they spend most of their time as a kind of and group solidarity

and with increased uncertainty so we think about the stresses here in the economy and the fact that 18 million americans that is what the shock is going to be so that's where you see anger generated think of it is this moral outrage. that makes people angry but if

those people are angry [inaudible] years later when they were offshore it's the sort of tribalism for the political leaders they navigate their way through different kinds of anger so he gets a bunch of people to vote seemingly against their economic interest by accessing

their anger about the state in an overly intrusive state or by accessing their attitude from race. you could trace it along. meanwhile in doing that, it effectively tapping into that anger that conditions are created by which new kinds of anger are generated also inequality across business that looks at the prophet and they dominate the market and the funds and basically you are

better off buying one month treasury so there is an enormous inequality and all of these things compounded with a lack of ability and control for the precariousness meanwhile so that it seems to be the fundamental driver not just of the income inequality but it's all compounded and that. >> let's go to a question from douglas who writes did you address the affect of the campaign contributions so you know broadly if you have people in positions of power how do you get them out of power and constrain them?

>> essentially there is a public dialogue in the hedge fund and essentially what we think went wrong and what to do with it but i really don't address that. there is a related question about the differences between you and eric. anna audience member writes one of the biggest differences between you with respect to solutions are you on the same track or different?

>> the inequalities i've been talking about it leads to more investment, et cetera all of which have too much credit et cetera. just look at the corporate dominance.

if they have buybacks, next week they will find another way so if you just focus on that rather than the problem of the corporate governance. >> would it be fair for me to say that you are focused more on the issue of fairness rather than egalitarianism and where does fairness come into the discussion? >> to me it is time to talk about the opportunity to produce the outcomes you want otherwise it is a house of cards. i tend to focus on the outcomes more generally if you want to

put it that way. >> excuse me if this is an answer i should know how is the proposed sovereign wealth fund different from the social security trust fund does that make sense? the equity when you consider the solution over 80% why can't we all rather than who is getting

diminishing slices. we can jump down to another question i just saw here 0.25% completely independent that has nothing to do with the electoral cycle that's more the design question the companies want to imagine the equity position if

you think about the stock market and the 20% how do they make money because every keystroke is data and it becomes something you can sell. why are we giving it up for free because that is worth 20% of the stock market if we were talking to sprint or t-mobile they would say we will sell you this [inaudible] so why don't we license our data and that way we get a stake in the firm's because we are giving

them something to use for their investment so that is a pure asset-based response because they make so much money. >> i think that there is a different kind of respect. it's the sort of surveillance capitalism argument that is fundamentally wrong and intrusive about the company's whether it's amazon, facebook or google weaponize in it and using this information to understand our deepest emotions manipulating us and if one agrees with that argument, one could say that it's just inappropriate to put people in the position of selling this and legitimizing this kind of corporate access.

it would be like saying you can sell yourself into slavery if you choose to do it we will give you some money. i was a little uncomfortable with the dividend. >> we can make sure what they use and again there's an element with one of my more liberal moments we disagreed on this one i would like much more regulation. >> regulation is the answer. >> you give me things in

response that i deeply value. if people are willing to make that a trade-off, why should i shut them down. you might as well get some money. >> let's turn to a slightly different angle. whether the national infrastructure projects are used to restart and whichever infrastructure target. >> absolutely. i'm not against other reform proposals if you want the technical version of this

everybody wants more transportation. what about now. what happens is as we continue to destroy our lives, national infrastructure to get more viral transmissions and this becomes something we have to deal with much more frequently. then even though i'm a huge fan of it what can we do, in the united states if you want to retool an entire workforce would probably cause less over the past three months.

let's be clear at the same time what we have shown in the crisis everywhere except the united states you pay 80% of the wages. everybody was able to do this and what that tells us is [inaudible] if you told me six months ago in doing so [inaudible] >> moving to a different question, a more philosophical one. chris harding asks he says he's not sure whether we can fix the

policy if we don't do the hard work of articulating the philosophy about the businesses. i talked about my question of solidarity and do we need a new philosophy to motivate there's this idea that there's a problem, we have a policy. that's what you saw. the problem is what do we mean by that so people say if we think about the successful

project in the century not as the social data cuts with multimedia it's very simple here are some things we need to do to ensure its uncontroversial looking for a transformative green new deal alienated half of the people. >> it is the 64,000-dollar question. i am looking for that new

philosophy. is there any alternative to the floating currencies, is not a bad idea, i guess i would add what about the eu in general the interest rate check. they need to manage and they make diesel. that's what they do on the euro

itself like hotel california you can check but i think it moves us to a different position. the proposal shows that the writing is on the wall. essentially you have a couple of things. then if trump wins, we don't care anymore so the world is

moving and can no longer pertain. it doesn't have a euro and it is in the wealthiest part of the world. what's going to drive this isn't, it's going to be a recognition among the states to neutralize because if they don't they are going to be caught in this increasingly fractious world. >> is that possible without a strong european identity among

the individuals and citizenry of the countries it's born in the revolution and its overreached. with the currencies it's always a civil war that brings about the green party. let's start with the central bank. the alternative is a massive disruption of wealth and its i think what we see now the recognition whether or not they like it is the part they have to take back.

>> and you feel the electorate. in the population you can try but it will fail and then you get back to something else. and you end up with a lot of value disruption. .. >> so it would make them come

to power would be the easiest thing that i have a percent death because of covid but if you do enough things at this point. >> we have just the couple more minutes there is a question about climate change. do you think there could be but one - - bipartisan support is framed as the national security question is there a way for a mediation? >> and this is from telling

people what to do but they are driving around on the gas lecturing it is a moral problem they are wrong but it's already happening at the end to take example and they have no intention of switching back so that they are needlessly politicizing into a moral crusade from the transition. >> so we didn't talk a lot about technology and demographics with these discussions in the book. but to what degree does this

provide silicon valley to replace workers with automation? >> i have been like this for a long time but to think about the idea the people making the robots should be suspicious but in conversation i have come to realize that these are not necessary conditions like what we talk about is minimum wage plus and then to be contested minimum but once you do that you force unproductive out in force businesses to invest more in capital not just the composition of employment as income goes up and then to change the world that has generated not just

the american employers there are lots of ways silicon valley and those the ones that are interesting. >> to some extent, the issue isn't whether if the amount of jobs will be destroyed but the nature of those jobs could change and we see that change of what the transition looks like not so much what will we do with all of this free time how is that dislocation handled? >> absolutely. >> one must question. from several different audience members how bad will the recession be? looking at another great depression? something short of that are how bad will things be the next few years?

>> nobody knows because we haven't done it yet because the wonderful thing about the way we think about the economy so how you think about the future if you think they will be off you probably won't do any investments which makes the future awful is that aspect of the future but but the way the united states has those that come up unemployed so to brats on the long run on that they are now destroyed but there will be capital and net on net it is a possible

argument by not doing that the economy can control it and then maintain we just don't know how that will play out and anyone that tells you they do is selling numbers. >> and among citizens who are still the electorate of think your point is it depends on their age in their notion of the future will be contingent on how old they are. and i think that is underscored so critically throughout the dialogue. mark, thank you for this great conversation both you and eric were a traffic book and lastly the audience for your great questions these are really challenging times but this conversation is not only enriching but provides a cause for optimism that thinking

creatively and very different kinds of solutions will hear seen in the past. thank you. >> great dialogue but the day that churchill

became prime minister he would agree this is what he wanted most of all he became prime minister with a rebellion in the house of commons of the consensus that neville chamberlain the pair prime minister was not up to the challenge of dealing with hitler and the germany but the same day is the day it was no longer a phony war when hitler invaded the low countries such as the situation churchill the greatest day of his life also the darkest day in the history of the world this did not don't churchill he felt this added spice to the challenge him to be in charge of this great empire is such a dire time fueled him