eighteen is expected to be the first year since the financial crisis that the global economy will be operating at or near its full capacity if things are indeed getting better why are so few people noticing it well to discuss that i'm now joined by. former first deputy managing director of the international monetary fund and former chief economist at the world bank professor krueger it's a great honor to talk to you thank you very much for being available pleased to be here now first of all let me start with this seemingly unrelated issue you're visiting russia the time when the united states department of state listed this country as one of the most dangerous places in the world to visit together with states like sudan and pakistan and the specific recommendation for the group of countries would be to reconsider your travel why are you defining recommendation of the american government well i'm not even though i didn't report i saw in the newspaper didn't even list russia in the same categories as those that he level three countries. i thought they had two or three that were listed is really don't

go in this russia was no this would be level four but russia is also criticized as a country where harassment and supposedly terrorism. pretty much the same level as for example or in sudan well i don't know but i've been here before and i think i know enough about the country to think that i'm safe here is that you were well the the reason i'm asking about this is because there was a time when the free movement of people differing movement of capital. for a moment of labor services goods. was if not encouraged by the united states then ideologically supported and i think the trumpet ministration may be speaking against some of those things but i wonder if there is more to have been trying to do you think these sort of shift from one more global or towards a more. isolationist if i may put it that way or in taishan has a structural rather than a political independent there's a lot of debate about that and different people have different views and i don't thing. we fully understand it quite clearly the one thousand or twenty sixteen

election itself was strange in a number of ways including the fact that there were so many republican candidates that made a very strange choice situation so i'm not so sure as to what certain certainly trump and his supporters or and the people around him. were awakened i think a degree of reese's and what have you in the us that is in my view terribly unfortunate and i thought we were past it as did many others i think the polls are not showing that much support for it he has the lowest ratings of anybody after the short of time in the presidency at least from what i read in the newspapers so i think that. it's an open question the extent to which this reflects something more fundamental or whether this represents a short term. now i know you've been along the influence of politics on the economy but i think what you can in the united states politics gets

to be substituted for security and there are a lot of security concerns passing for. political or other way around political concerns passing for security concerns and when when it comes to global trade regulations there are exceptions for security concerns don't you think that disk law because of security is running a risk of being abused at the country's president security considerations as a way to get a competitive advantage well there's no doubt that individual industries will push whatever they can push to try and get whatever special favors they think they're they want if i were to worry about protectionism in the united states i would worry first and foremost about the those who are saying oh it's the jobs that are at stake whether they are or not. but a company is not going to say gee we're losing body we want to make money for shareholders they're going to say look we may have to close the factory in the workers will lose their jobs and that's a more potent. a little argument and it's used at least as far as i know this for

the political argument in most cases has been the job loss whether it's right or not more than the political on the political side there have always been i think in most countries certain kinds of exceptions for national security reasons we don't want a secret snowden that kind of stuff and they're overdone of course to some extent in some cases but i don't think so far at least i'm unaware of anybody who saw that that was anywhere nearly as important as the job well i haven't given you one example my own channel has been r.t. has been sanctioned because of its supposed that interference in the american political process and what's interesting about it i know you don't want to discuss politics but i think it has an interesting economic implication because if you limit the way those companies twitter facebook those big multinational multi-trillion dollar companies operate not only in russia but around the world and if they're seen as pliable to political interest american political interest

whatever they are republican or democrat. i suspect that that may influence the way the global economy shaping out because it's changing at this very moment don't you think so i certainly agree that there's a risk in that direction i certainly think the degree to which those things have been called upon is already very risky i hope that sort of very soon of course where that could become a more general kind of issue that pushes protection of more directions is the bigger danger and as i said i think it comes from other things worth and from that there is one more proposed sanction that was just the in relation to russia and that was switching this country of this with payment system which i think raised a question about who controls the infrastructure for the global economy and that's scary to a whole lot of people not only in this country but also i know in other countries there are now very busy developing alternative solutions g. thing question may have an impact on the way. bill economy develops forward who

owns those platforms that facilitate global trade well i think you can buy him back when you'd expect me to say the obvious answer is to get so some international organization the i.m.f. in the case of the swiss system or the group or something controlling those things to a greater degree than they do now i think the alternative will be unfortunate in the sense that if we then end up with different payment systems it can create a degree of uncertainty for trade in for service transactions that would be unfortunate for all of us i think it's a lose lose situation if we go that way you're leaving me perfectly to my next question i thought that this kind of dynamic creates a competition not only over the means of production but over the means of trade and we haven't seen that comp kind of competition before to such an extent you can essentially take the entire country out of the global system by just pushing the button and bad potentiality is very scary many people i know you're not in favor of

sanctions in general but i think also it creates a very interesting way of how effectively those sanctions can be implemented and my question to you is that we have the bretton woods system that was designed to address some of those issues to ensure. it's coming the tory treatment and such do you think that system of base day and age is capable of addressing the issues that we are talking the u.n. the world bank the everything internationally is sort of subject to the what the political will of the owners of the system or in the owners of the system or the nations of the world and in so far as they they fight it in their interest to agree on something i think they could do it whether they will be able to do it whether their political masters will want them to do it is is the important question i think by the way i don't think that any country can push a button and get rid of trade this is far too important to be farmers to political backlash. protectionism to

a point unfortunately perhaps even when it's damaging yes but to talk about cutting off trade i think that is but if you ban banking transactions from a certain country that's effectively what you're doing obviously over time people will be able to find ways around it but that deliver such a blow that i think would be very significant for any given country money is a very fun jubal thing and i think it will be very quick before people found ways around it because as i say it may be damaging it might could it but the idea that you could do anything nearly. that is very unlikely i think four ways around it would be found very quickly just to mention an obvious one. somebody here might find somebody in canada the can of the canadians could deal with the u.s. and come back you could be sure there are people that he says of many countries who'd be willing to play that role well rich may not be such a bad thing after all because at the end of the day what we want is. a system for all not speaking about the bretton of with system the soviet representatives did

attend that conference they had it in them to show up at the event but they did not ratify the final agreements charging that the institutions that that conference created was. one of the branches over the wall street and i think that is the view that many in moscow still espouse you worry both at the world bank do you agree with this assertion which is very popular in moscow maybe even in beijing that they i.m.f. the world bank are essentially. serving the probably western bias well i think the outcome certainly through the first sixty years of these intuitions is that they serve the interests of most of the world i don't think you could argue with that one i mean we've had you nervous economic growth unheard in the history of mankind most countries have benefited by it some where the know there is those who opened up more benefited more than those less i think that's questionable so i don't think that it's a question of that certainly the united states was very dominant it is creation it was after all the country the only. country only large country that emerged

reasonably prosperous right after the second world war and in that sense that have enormous role in setting up the system that worked as well as it did but in any event how long that will continue and how much it can be after all the us hope preeminence is going down i don't think is gone but it certainly less than it was other countries have a bigger say and they need to exercise it there but i still think there is a world interest and i serve them both institutions and i am an american citizen no point did the americans ever come to me and say you used to use this they knew i was an international civil servant i knew i was an international civil servant they had an executive director just as russia does and they're in the executive director was responsible for representing the u.s. interests well professor take a very short break now but we'll be back in just a few moments stay tuned. on.

the economic will resume phoning in the realm of education the right to education being supplanted by the right to access education. high education is becoming just another product that can be pulled from the souls so it's not just about education anymore it's also about running a business and what you could. look at this almost kind of a little economy. which is the place of students in this business model for college i was born now and i'm extremely more education of the new global economic war. prescribed medication is widespread on the us market frequent cause of death at

that point in my life i just felt like everything was ashes my family was literally coming unglued i had actually planned. to commit suicide watch who has made entry to prison so commonly used we were doing what the doctors told us to do we were being responsible and what the real side effects. is. what i did was. legal. just because. both come back to worlds apart. former first deputy managing director of the international monetary fund and former chief economist for the world bank professor

krueger. one of the issues that was prominent at the time that the brought in the wood system was created which is seems to be pretty divisive today is the issue of trade deficit classes the united states has been on both sides of the debate they're running a surplus before i believe they're not and seventy is now running out five hundred billion dollars yearly deficit is that a problem that has a solution at this point of time well first off i don't think anybody worries or wish they should not worry about trade they should if they want to worry about anything else from the current account deficit which includes trade in goods and services and the decisions especially important right now because the world has shared the share of the world's output the service is increasing is growing much more rapidly than trade and trade in services is going to american services are going to are there and that in deficit and it's a mistake said the second point to be made is that by definition. between a country's current account purchases in its current account sales is the

difference between domestic savings and investment and current account deficit can be a very healthy thing if you're a rapidly growing economy if you need more you could productively use more investment than you have domestic say biggs south korea for example the one nine hundred sixty seven savings rate went to five or six percent of g.d.p. and investment rate was twenty percent and it was borrowing the rest of this group exhaust fast it wasn't a problem because it had many productive uses when that happens that's fine but either way it is not a problem for the world is a problem for the country now if you get the exchange rate very wrong which is where the i.m.f. comes in and the chances are it's come about because of domestic measures that tip this imbalance between savings and investment and then the i.m.f. comes into both parts of it but the important part is the domestic balance but. just absolute figures. basing to be stunning in the case of the of the united states and it is often the trade performance is. a reflection of the

disagreeably of burm of the whole global economy as well as the. balances for the american economy domestically i guess what i'm asking is rather this labor and has already become an equilibrium of sorts that may stay in place and that dressing up which may create more problems than it solves. i was going to graduate school in the one nine hundred sixty s. at the time when there was a dollar shortage and when all of us discussions and all news discussions were of the u.s. dollar shortage and how other countries didn't have enough and how that was a permanent equilibrium now who are the other side of the court and i have no doubt that just about when everybody is convinced it will change yet again the american economy is in disequilibrium it is savings or is that are not as great as its investments and so there is a problem there and the united states needs to take measures and the tax reform bill as i understand from what i've seen of it what we can understand of it so far will make things worse stuff better in that regard as i doubt but there is that on

the other hand there's another side to that and then see other countries don't the chinese have gone some way to rebalancing their economy away from so many exports and that's probably healthy for the world economy the united states and some other countries in europe need to do the same thing on the inside or one side or the other but on the other hand the disequilibrium so far is not that terrible and there is still some time speaking about the dollar the united states there are a lot of benefits from being here is dollar being the top reserve currency but it also makes american goods and services more expensive and ultimately sustains this trade imbalance if you had to choose one of the other what would you prefer and can you really choose can you fine tune your economic policies or next time when you don't have a desired outcome about the side effects for example aiming for increased domestic production and without strengthening your current well right now the united states economy is a very full employment the only way to get increased production without a lot of inflation will be to get a greater rate of increase of productivity so the idea that you could do it through

policy measures that would for example print more money or cut taxes will not have workable expenditures will not work except to be inflationary pressures and maybe in the very short run a little bit but the longer and consequences will be unfortunate so i don't think it's a question of choice over the longer run the question has to be how do you balance . and the real worry i think for the western european countries for japan for china for the united states maybe for russia but i haven't looked at the numbers is that most of us are facing increasing costs of pensions for the elderly increasing the health care costs because of the elderly many of which fall in the public purse must there are measures taken to cut fiscal expenditures or raise taxes tax revenue somehow we are all facing bigger problems it will be global disequilibrium not one or two countries now you mention the issue of savings and i think this is another factor that stains the current pattern of the american spending that you that people are encouraged to spend more than they're earning that there is no other

various the bush tradition of saving up money putting aside trump and his policy speech i suppose you know they're great. do you think any american administration at this point can promote actively promote policies that would encourage people just band last and to save more well saving more i think is the we're hopeful problem sees in these spending less and that a dad doesn't want presupposing out there not necessarily their visions for example where you could indeed raise tax revenues in such a way that you cut the fiscal imbalance and that's cutting the deficit so no it doesn't need to be on the other there may be things on both sides then that's a choice variable there's still quite a question about that i think the question real choice is not the one you made just the real choice is whether we do something with the us do something in the near term to start correcting the valance or whether we wait until it's even more pressing and we have to take more drastic measures now there are many truisms in

economic science and one of them is that markets and economy likes predictability now i think i would agree the trumpet ministration is possibly not the most predictable. the economy the american economy is doing fairly well but for which trump is a really taking credit. do you think it's due. so well because of him or despite him well the economy was picking up before he came into office in all the twentieth century is far from any further back i was happening to the economy this year is not a function only of policies this year but past there was momentum for the upturn ahead of time there's no doubt about that and we were already on the path to recovery and certainly nothing that happened in let's say the first six months of this year could very reasonably be attributed to that secondly terry policy which is the responsibility of the reserve is outside the control of the president we want to dependent it is reasonably so so that again it's not probably there is a little bit of an uptick at the start line or more of an uptick in the stock

market because of what the tax law and a few things like that but on the other hand i think there are concerns over the longer term at the moment the markets seem to be very euphoric and they don't seem to be looking ahead but i think there are reasons to be a little more cautious and that. i don't know if you would agree with me but i think the american economy. especially be the starting of history of the american economy poses a very interesting philosophical question of when your biggest witnesses or biggest strength trade places so when your biggest weaknesses become your strength. and then american economy in that sense is unique i think in both its exposure and its reliance on the rest of the world i wonder if you believe that it can still be treated as a purely national economy should it be approached as an economy of one country or whether larger considerations always have to come into play well i think that all of us perhaps somewhat more swollen economies the large ones but all of us have to

take into account the international repercussions of what we do because we are interdependent which is i mean this streaming kind is getting more and more independent not just the past hundred years despite what some people say but marco polo already was it greece is going to defend its way back when it's been going on ever since and even before that well but i don't mean sort of neighbor policy is not taking advantage of. if your neighbor but i think what's interesting about the united states is that one appeared on the scene of his slogan putting america first it was very difficult for me to explain to my russian friends what he means because in many countries you are supposed to do that anyway you're not making that into your election slogan this is something that is presumed he will not be voted in if you are in my opinion we are the way we were putting america first with the old policies and we are not with the new policies because i think the biggest losers if those are carried through from what he said are going to be the americans but how would you balance there's national interest and the interest of. international multinational companies which i still think have

a certain influence perhaps bigger than expected on their merit maybe and some political ways they do but strictly on economic grounds in the longer term i think there is no way that the kinds of protectionist measures that the president has advocated if they come to be will be in the american interest in the longer term there be a few people who keep jobs a few days or a few months longer although even there along with that is a femoral we had the occasion i think it was last week or the week before wal-mart announced they were going to do something with raise the minimum wage to eleven dollars an hour which probably they had to do anyway and the next day they don't really love by forgot one thousand people over here so that you know the saying that they don't see what these great food for the other thing gives out a little footnote oh by the way and of course people who don't so things that they think but i do think in the case of the kinds of protectionist measures that the trumpet ministrations so far and because if they come into being or to the extent that they do they are negatives for the entire american economy and probably their

negatives for the world in two ways one of course the world gets a little bit hurt they could have export war but to unfortunately that is also giving aid and comfort to protectionism other countries who will seize a look the united states has therefore give us protection what are you speaking about and part of what i heard a little bit speaking about his protectionist countries i think russia could easily qualify. the need for structural reforms in this country has long been recognized but for just as long they have been sort of put off until a more opportune moment you published extensively on policy or reforms and developing in transitioning countries have you developed any sounds any intervention on how to identify that the right moment well i don't think you do identify it comes the normally comes this is surprise and in the countries where we're had there has been at least a significant group of. interest so you put it that way who have had a good plan sort of sitting there reading to be adopted they have so in some of those countries they've been able to do very well when the time came and

a risk capital comes when in feet you don't have anything ready and then anybody who comes in with a plan. the leader who's a crisis conditions and so would seizes the baby reproductivity beda be so i don't think it's a matter of recognizing it i think it's a matter of being ready and having in the meantime trying to avoid things that make things worse you're also famous for coining the term around sick and i think russia is especially prone to that kind of business and economic dynamic for all sorts of historic political and other reasons what do you think it takes to make that change from sticking around into a more forward looking perhaps more risky but while for generating new wealth generating well i don't know the russian economy that we're in but i do know there's lots of oil and gas and that is both good and bad because it can lead to an economy where you sort of speaks it happily on what your good fortune of having it is sort of using it productively you know there are activities and at least from the outside and based on what i know the russian economy has not successfully

transition to reliance for growth other things other than the oil and gas as much as i would have thought a good reform board and i think convincing people that would in my guess be the way to go because there is a future. for russia as everybody else does that depend on just the of those threats well i. and if the united states is actually lending a helping hand and in that persuasion war and because you know that there is a new round of sanctions to be targeted sanctions to be introduced against powerful russian individuals and i think in russia it is a problem we have a problem of privileged access and. certain individuals well connected individuals just sit on that cots and enjoy the status quo perhaps limiting opportunities for everybody else do you think. the american factions could provide some silver lining in that founds of sort of spurning the powers that be towards i don't know who's i don't know enough either about i have to follow that closely what the americans are

talking about it in the last year there have been so many statements coming out from the administration that you don't know which ones to follow and which not to and so i tend to wait until they do things rather than what they say they'll do the second thing is i don't know enough here as to what's going on but i do know is that a level playing field where the new start up where the guy has got something to go for what he's treated the same way as the big guys is the important part of getting the growth going and i just don't know how much that is my impression actually in the one nine hundred ninety s. once the cobbles of it if it is state started there was a time when there was a lot of sort of grass do grassroots coming up and things look reasonably good and not that much of that has happened the past ten years or so which tells me that maybe. a little of this one guy has more trouble than the last guy getting hold of the resources he needs and so i don't know that professor career have to live in fear really appreciate your time and to our viewers please keep the conversation

going you know social media pages and i hope to see you again same place same time here on the world's apart. young children have worked in bolivia for generations almost three quarters of a million a doing so today. this culture led to the development of bolivia's new liberal and highly controversial children's code in two thousand and fourteen which gave

children as young as ten the right to work under certain circumstances what is and is in this. case all news. eat well without having the end all. the things years. but there are hundreds of thousands of children in bolivia operating completely outside the local. mining work is strictly forbidden by the children but it's never enforced and that means the school boy minus here continue risking their lives for the money they need to survive on.

dropping bombs brings to the chicken hawks the battle. for the tell you that. along. with.

the headlines on international president. any talks with north korea working just. between the north result in a breakthrough. move into its border with syria. in order to maintain washington's presence. and frustration over migration regulations in europe. consider a referendum to the free movement of people agreement with the e.u. .