hello and welcome to our in the money where the business of russia is business i'm peter all of this month we were at the same petersburg international economic forum holding a panel discussion on the crisis of capitalism our panel included academics c.e.o.'s in opinion makers ronnie goldberg she is the executive vice president and senior policy officer at u.s.c. i would be all go ahead she's deputy prime minister of the russian federation and he is secretary general of the o.e.c.d. . he is rector of the russian presidential academy of national economy and public administration hons york he is chairman of the management board of the investment

banking division of barclays are meant to sign here for isn't it of the eurasia house international and we also had an independent economist. let me go to you first. do we have capitalism today well i think. we have the capital. of the world and people rich people can move around and that is that capitalism well i think capitalism. capital is. looking for opportunity and i think. how we do it define capitalism traditional economic theory we see it's competitive markets and capital competitive markets put an extend i think of this is being subverted because. on the one side. we see the rise of state capitalism everywhere on the other side or

people would say corporate capitalism and only when we have. the other side we have a. capitalism that's sort of relationship based kept advocation then we have a financial capital as a way speculation now i think of these three forces. really undermining the the the the world of market economy first of all out of the grid should get hung up about names and this capitalism sounds like you know nineteenth century discussions that. it's not about that it's about market based economies rules based economies this is what we're talking about and the reason why some are doing better than others is because they played their cards better because they got it right and right no we have the best example of the differentiated approach is the ones who did it right who saw it coming got it better and have much better results i think i

would like to second what the world called. to say here is first of all what is capitalism at the end of the it's about compared to this competition or an airship interpret north pole for the factors that are important here i think one factor that out of many that the world facade is is the breakdown of the berlin wall so before the world was i would say as a former physicist the world was classical you have to live and you have socialists now with the breakdown of the of the of the berlin wall we're entering the new world where politics and economics are quantum what does that mean in the biz that it's globalization at the end of the day it's every in each unit matters it's quantum it's not the global idea. of capitalism or socialism there each country has its own way of handling capitalism together with ideas from so. well is because

soviet union doesn't exist the fear of soviet union other nations you're absolutely right because rich people have socialism. you can't fail it's wonderful you can make catastrophic mistakes and you'll be bailed out so you have cap you have socialism for the rich and everybody else all the rest of us get out of listening to you know it's not only socialist for the rich it's also all socialism for i mean isn't for the rich for god's ok ok let me go even further with that list of. go to jail ok let's let's let's take your own country where are you from originally from california. ok so i'm fine if you come to europe but it's very corrupt but it's a wonderful place. at the end of the day if you take european states what has happened i think the whole idea of welfare state which comes with the idea of equality that every citizen has the right of this has the right of the second thing to the third has become

a economy huge burden to that quantum human it the whole idea is development if you're quick enough if you change yourself if you are evolution being big call it kept a lid saw it on then you'll survive it this is what you it or you can read our economic growth you could have economic growth you can create dividends you can create profit but you don't always create development ronny it seems to me it's just another bubble being built again it's really it's going to run here because it seems to me it's putting it off putting it off you know i'm not sure what it is putting what off i want to go back a reckoning i think and i think what is new is the pace of change. which is creating its own situation and its own dilemma for and particularly for young people who are a big part of whatever crisis we're talking about now in many countries and lost their necks. but the variation when i grew up the idea that i just thought there's

a law of nature was what we used to call the revolution of rising expectations right it seemed just completely natural to me and i never double that i would have a better life than my parents were not that's an american creed too yes very much america then i think is what is in danger now and part of the reason is the pace of change and the. mismatch right now between the education system and the skills and the capacities that kids are learning and the fast changing need. places for them to use the skills and so i think that's an area where we really need to know that this is the expectations rising expectations is much more of an emerging market world experience right now or what do you think about that. no in russian

federation sometimes you have a very interesting joke we speak about one zero nine book neighbor. is a very good socialist country i have a question what country do in socialist countries and then will russia the best example. of course. finland and so on when they came to finland they said meal is proud we have no one person and for. only one person this year it's number one and it is a set we invest not in banks north in the financial structures but first of all we invest for all people for education system for health care system and so on and so on. and they have

a very with the result. that is the difference and you're not a i think i want to make comment on the scandinavian countries because steve down there well in the last five years but actually i think the story over the end you look at that i'm of sort of poor pointing out that the household debts over there the levels at the highest in the world have been rising very rapidly they have widespread interest only mortgages. huge amounts on the books i think that this story may be. too good to be true let me know we raised a very important question because these cries of this global crisis not the financial crisis of nine thousand two thousand dollar hit by the crisis we asked for about ten years or so this is a crisis structured the crisis of industrial world for a state. crime is this so we look at the car and cry the crisis is more severe where the traditional industrial state welfare state is developed in europe it's

not as strong and united stated with almost no welfare state or in russia or in russia itself the situation because of this welfare state collapsed in the ninety's and it was a situation is much better in imagination economy because there is no central bank there door there is that that's there's no in sense of entitlement ok well it is in the european the euro zone there is huge in title in the united states it's kind of ideology and look at the stations that contrasts with. develop industrial face but it doesn't meet the productivity requirement that's in the southern europe is stronger than the northern and again one of the question one of the most interesting question is whether. congress emerging economy sure will. industrial development a welfare state or will it would be just completely new decisions in a pension but if you want to run it do you want to dress that as i think that's very interesting because we. the west is a model for

a century or so ok at the cold war in between but is what the west is doing a model for everyone else or is it different ways of doing it because when you look at it's very different well if the west. european in europe. and which the north of this is clearly showing that. the whatever they have built up is not sustainable at least not sustainable in its present form then i think the questions asked and answered. but i think this brings out. the limitations of talking globally the situation in india where something like eighty percent of the economy is informal in other words. not paying taxes not subject to any kind of social safety net and so on that situation is. very different from i don't know

china or other parts of emerging asia. and unless we can figure out unless the indian government or the indians writ large can figure out a way to tackle in formality they're never going to tackle developing india which i mean one thing emerging markets can learn is that not to go so much into debt i mean this is a huge issue when you you know the russians got burned so bad in the one nine hundred ninety s. they just keep stuffing money away because they're just so paranoid about it it's a good policy ok there's a lot of people in the russian government with all due respect to abuse they would spend and spend and spend it ok and there's a lot of others they will remember the one nine hundred ninety s. we're going to keep some money for a rainy day so i mean different perceptions of how the economy is changing much more risk adverse i think that of the countries fifteen years ago have been very cautious you look at indonesia the no no financial sector debt is only sixty percent of g.d.p. . extremely little and so china. is in pretty high spot

a two times show and needs some adjustment to make and only show attitude towards welfare i think that there is a structural reason why emerging economies to have less dependent on state welfare is because a family is still lacina the welfare is it walks inside of the family and i in the future we don't know we are going to one child policy in china. most the country's wealth rates are declining so where the world will be we don't know it's. the structural change we're talking about i know with the crisis of capitalism i would google that is about a speculation point out of these are two separate reasons no you mix of the two you're not of the speculators a get away you know so we're on the same side i'm all for talking about a structural changes i think it is unprecedented at a people is going to live one hundred. by the end of the century and if they don't

walk more like a forty year it's. going to be painful it is and if they don't have children you know people want to have welfare and then they will have children and so on who are going to pay them no lawyer these are so i think the way to go away are you know very troubled a wall with being the case ahead. download

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spill was not something you grasp just by looking at dirty birds we have between four to five million people in this directly affected area of the coast and it's pretty clear why it's not being reported because b.p. can't afford to have a reported all along the gulf coast are clean they are safe and they're open for business if b.p. is the single largest oil contributor to the pentagon the us war machine is heavily reliant upon b.p. and their oil this is a huge step backwards for the marker see it's a step forward oligarchy carex it is toxic is a look a lot like spraying in vietnam it was it was not a picture that either the government or b.p. really wanted to have out there i don't want dispersants to be the agent on. this oil spill.

more news today ballance is once again flared up. these are the images cold world has been seeing from the streets of canada. trying to corporations rule the day. welcome back to on the money i'm peter all about your mind you were discussing the crisis of capitalism at the st petersburg international economic forum. model and i'm not someone who's saying you have.

a liberal listing it doesn't work i do not believe in the invisible hand which arranges things i think it needs a very visible hand this state has many things to do so the state should balance out but the state should not abused over its monopoly to allocate all resources to either you or to me never knows and i think we have countries which balance this with world of a bit less we have a very vibrant demand. which is more innovative it's different it comes from a different structure compared to europe there's no doubt in europe we are different in that sense from the european continent. countries to choose their models it's about countries have to choose their own way i think it's very very important why it's important because if you go back some twenty twenty five years ago what that

was not the case there was a wonderful model which was the story of the with the what they were you call it the worst thing you have united states and when the countries or former soviet union started their power. wonderful life like your switzerland the thought it will come tomorrow immediately and it's of the mother was very simple just privatized it never a love letter lived in poland in the name of release and they said we have capitalism we'll just have more stuff. and i said what's not is simple is that no we did you guys have a lot of stuff we'll have lots of stuff to live because. it was a lot of stuff is one thing in my second love i used to be a politician i used to be prime minister of my own country so one of the first challenges i met was how do i handle the world back basically i became a prime minister and what i had on there was a country of three or four or five years of independence privatizing like mad

everything that we had while the country here was blockaded by its neighbors it had the conflict with its other neighbor so there was no intention from the huge army and versed in the country because they would like to send money as well so there was no common sense in privatizing except hope and they would think the begin destroying is for peanuts and basically destroying them so what i'm trying to say here listen going on no no i think that's also not being educated was taken by an example of success so what we have learned probably one of the lessons that well learned to know that as we heard here there in this country not only has a choice but has to really think about all its own a model of success of balance the i.m.f. has a different point of view there are a lot we want our money you have to do this you want our money you have a lot of conditionality it conditionality conditionality it's all nice and find

what you decide i agree with you but the i.m.f. comes in ok now but it's not about the above let me differently for once. please do it's because it's not about the uniqueness. exceptionality and everyone is different and so different there are a lot of common things that we gotta do we've got to get the fiscal stuff right in order to be able to pay for the minimum of services that we choose we can't choose a certain model and then not pay for it for example or get here because we love the model and then you know pass on to the next to the next generation or if you are blessed with for example roma to realize that have a banana and see it spend the whole of it now instead of doing like what the chileans did we're just keeping it for the next generations except for and then so so the question of the exceptionality is fine every country is unique it's original

it's different accent or but not so unique not so different you know there are common rules though there are certain rules and there are more and more integration in the world economies and for that you need a lot more commonalities and more plug and it's good that we're on the opposite ends here ok i mean you wanted to. you see. i would come to elaborate to be atoned this but of course. you know this is a famous first trees are on the cut in them by their own tall story that all families be in the same way and. have disaster in their personal way that's why i would say to allege extend the same the country is historic be somebody ghoulish and some rules some general rules not to make a disaster but they go to the disaster fool in their own unique way as soon as a country says i'm unique no economical rules exist for me it's the first step to economic disaster again we should be more just which of them to stand the political

for government performance exist i would go for us we can want men to come in crisis if you're going to do you think right now he's well if you can plead guilty as look at what was. right all the rules for their own advantage no. and goes to jail there's no downside you never can fail i mean this is you making we're making a very simplistic model here but we're forgetting the issue of politics there that's very important to me and this is all let's be not simplistic. they're. all disappeared they were. brothers that's it and it actually actually quite a number goes to prison but to come back on something more important. is for example having been chairman of the second largest company in the world we were discussing obviously these subjects day in and day out take russia and there is a typical example of how the state should function russia has new wood and i think

it's two thousand and eighteen. that sixty percent of all drugs have to be produced in russia. that is your dose the state it doesn't say we will do it it is the your call me is going to do it with it's foremost because it's russian companies but they have to be produced here it's a question of price it's a question of security it's a question of control and it is particularly a question to give a new life. in the country so that the russian scientists who are working many many of them in boston in switzerland where. they will stay here because of protection will be here and this is a typical example of how a government can channel. and push things in the right direction to fill what you rightly mention is still a relatively big gap of able but this is the wrong direction in all it's already

are all seriously go by water if you're. sixty percent are a big territory if you don't produce a bit that we are condemning the population to buy expensive low quality problems sorry i know they're good to to have. wrong. rule be produced competitive flee so have not excluded some form firms have not excluded imports in newly developed they just do something where they say and give a huge incentive to their country to develop an industry which didn't exist anymore why not open more to competition but you don't like what color to shake it is open to because it protection is right anyone anyone can pick we should we should resist protectionism on trade eat when it's creating jobs in this wonderfully what about if it's creating jobs in this current interglacial yes they send their kids to school that sounds like a good idea to me by a blow to the big board you just want big pharma to invade russia in the taking

over porch or shoot yourself in the foot because you can't export nobody is competitive it is that the world is no organized along global value chains and you do one of the links of the global value chain russia or any other country in the world it has nothing to do with russia it is the way the whole production in the world is or going full circle here we're all talking about it and then i have to have to correct you it's a question of security. going to put the disposal of vaccines where we we i'm saying now we can choose whether we give these vaccines to america doesn't produce. or to russia where security is a very strange birth we don't need to go in the last year with really. a few soldiers who are doing just. the inefficiency i'm sorry. you know we can all live in a dream world but we do not believe in one country and come to be competitive

security is and will remain a very important thing but you're saying this is. just let me let me finish sorry not to say it is sponsibility of the government in russia in the in germany or in france to take care of the security of their people should it do we believe that there are more secure counties no thinker here produce. i can make every exception as it was in the. evening it's no problem it's not serious it's not. that governments can gift that direction and for example in this particular case to close the very held step you're mentioning. yes production should be here yes it should be cheap yes one should break. which the export to which

i need a long. and i nevertheless we all understand that these things should be done by generics from israel they're cheaper and. i kept pushing the crisis part but we got some optimism here i want to thank my pet wonderful panel here and i would like to thank our audience here for being with us. to. speak to language. programs and documentaries in arabic it's all here on. reporting from the world talks about six seven p. interviews for intriguing stories for you.

to find out more visit. i would rather ask questions to people in positions of power instead of speaking on their behalf and that's why you can find my show larry king now right here on r.t.

question more. political. world. will. see the end of the speech. as you. wish. all things long misleader. just see them on and on. and on. and on mine i'm

a fairly. safe. lou.

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