IPS-Nathan Lecture I - Disruption. Democracy Falters. Capitalism Flounders. World Order Unravels.

[Music] good evening ladies and gentlemen welcome to this year's IPS northern lecture series my professor Chen Kang Chi 7sr another fellow for the study of Singapore following her lecture professor Chen will take questions from our facebook comments the Q&A session will be chaired by Professor Denis qua Dean li kai-shing professor in economics Lee Kuan Yew School of Public Policy National University of Singapore here are some housekeeping rules at the start of our event the lecture is being streamed live on Facebook it will also be recorded and uploaded on the IPS website and Facebook page theta please some your comments and questions at any time through our Facebook page we were trial bears to answer as many as we can we also like to hear your view on the event there will be a link on our Facebook page which you can click to submit your feedback our director of IPs Jared Esteban will be giving the opening remarks director please ladies and gentlemen welcome to the seventh IPS northern lecture series the first which we are also conducting virtually over facebook life and also the first there will be broadcast over radio at a later date the SR Northern fellowship for the study of Singapore was established in 2014 to pay tribute to our sixth and longest serving president the late mr. SR nodded the fellowship aims to promote greater discourse in Singapore's public policy and current affairs typically held on the University campus the IPS northern lectures seeks to advance public understanding and stimulate discussion of national issues to engage the minds of Singaporeans and in particular students our seventh s our northern fellow is Professor chanting Chi many of you would know as Singapore's permanent representative to the United Nations and longtime ambassador to the United States over sixteen years in Washington she was asked well known in Washington as she is in Singapore she's currently the chair of the Lee Kuan Yew center for innovative cities in the sink at the Singapore University of Technology and design and on the board of trustees of I sees use of Asia Institute and continues to be ambassador-at-large at the Ministry of Foreign Affairs she has worn many hats over the years I like to think that she was occupy I'm the one of her most distinguished appointments was as the founding director of IPs since then we have had the descent of directors to me an academic and political scientist by training she was the head of the NUS polluted apartment and political science before she moved over to diplomat diplomacy and is known among other things for 1975 paper politics in an administrative state administration state whereas politics gone which she informed me she will return to in the course of these lectures professor Chan will deliver three lectures titled world in transition Singapore's future her first lecture is disruption democracy fortis capitalism flounders World Order unravels this will be followed by a second lecture the us-china reverie and a third and final one which will come back to Singapore in a time of flux optimism from the jaws of grew she would speak about disruption looking at Cove in nineteen and beyond she will also talk about the us-china rivalry and she will consider the implications for Singapore of all this or even if it appears that there are challenges on the horizon I would also like to thank professor Danny qua who is Dean of Lee Kuan Yew School of Public Policy as well as a li kai-shing professor in economics at the school he was perfect previously a professor of economics at at London School of Economics his research interests include income inequality and international economic relations and he is well-equipped and I'm grateful for him to agree to chair the Q&A session later without further ado professor Chan thank you director of IPs janitors Devon Dean of the Lee Kuan Yew School of Public Policy Professor Danny quoi I thank IPS for inviting me to be the seventh as our Navin fellow it is a great honor to share my thoughts on an important topic with this audience as Johnny does Devon has said the theme of my three lectures will be world in transition Singapore's future rapid change is now a constant globally important institutions are questioned and coming apart a lot of churn is happening in society in the economy and geopolitical shifts are in the offing these this evening I will speak on the first of three lectures and the title is disruption democracy falters capitalism flounders world order unravels you are familiar with the poem of William Butler Yeats the second coming can we have the point please thank you I think the point captures the mood presented by the profound challenges we face today we all know the lines Things Fall Apart the center cannot hold it is invoked so often it is now a cliche you are familiar with the last two lines of the first verse the best lack all conviction while the worst are full of passionate intensity now the second verse and last line is less familiar and he says and what rough beast is hour come round at last slouches to especially him to be born now some literary critics interpret the rough beasts according to the era it can be a historical force communism fascism the atomic bomb or something malignant is the rough piece today terrorism populism political conflict or a pandemic now that I have provided the setting let me turn to the four big challenges the world is faced with today the first challenge disruption the covet Knightley's virus spread silently and swiftly and became a pandemic in a couple of months everyone in the world was disrupted you know I had completed my first draft sometime in the middle of January I wrote about the VUCA world represented by technology of disruption the future of work and the acute and chronic climate hazards I did not include epidemics or pandemics that was a mistake Bill Gates in 2015 had four wonders that the world would not be ready for the next pandemic having come out of the Ebola crisis he said and I quote if any Kipling kills over 10 million people over the next few decades it would most likely be a highly infectious virus rather than a war not missiles but microbes Gates was right the virus epidemic which started in Wuhan became a pandemic within three months and took the world by surprise with his contagiousness severity speed of his spread cities are in lockdown markets in meltdown economists believe a global recession is unavoidable and on June 17 yesterday w-h-o reported about 8 million confirmed kovat 19 cases globally and the death toll was about 440 thousand many wise people are describing kovin 19 as a historical watershed it is a searing experience that has touched the lives of every person in the world in a way no other threat has done before covet 19 has taught us many lessons many things we took for granted were changed disruption was experienced in every domain freedom of movement freedom of association freedom of from fear and anxiety for personal well-being we fear the loss of business our jobs we fear about for health security and food security they are not enough mass medicines equipment and we fear there will be no more food in the markets and supermarkets never have citizens felt more trapped whether they live in democracies or authoritarian systems but this disruption also showed that countries and territories in East Asia which have been seen to be successful in bringing the kovat 19 pandemic under relative control China Hong Kong Singapore and Taiwan all had gone through a traumatic pandemic SARS in 2003 South Korea another successful case whether a MERS outbreak in 2015 these societies learned and very importantly developed resilience from the earlier health disaster furthermore in spite of having different political systems they all share to some degree a communitarian culture where social solidarity is valued this makes it easier for governments to implement measures in a crisis and receive a high degree of compliance this seems to be the case - in the Nordic countries where the communitarian spirit is strong and reflected in their Universalist welfare sector and corporatist economic social model they are managing well but medical experts would argue it is really widespread and early testing and a well-run and well-funded healthcare system which seemed to reduce fatalities and contained the situation social cultural factors aside the question everyone is asking is how will covet nineteen change the world and there are different takes in an op-ed in The Straits Times in April I took the position that I do not see a great transformation happening post Cove in nineteen some things will change some trends which are already there will be accelerated but in the end the National DNA's of countries will assert themselves and things were settled into a new norm a bit like the owner I know that Malcolm Gladwell author of the tipping point makes the same conclusion in a channel for interview on April 20th 2020 he said the Kovach pandemic is too short for transformation he said the Great Depression lasted 10 years world war two five years the kovat 19 pandemic for two to three months well I think mister Gladwell it's a little longer but I get your point the effects on the economy will last much longer Gladwell suggested we should never underestimate people's ability to go back to normal and return to the status quo you know I was in the United States as ambassador when SARS happened I was there during 9/11 for the global financial crisis in 2008 2009 each time there was a lengthy self-examination of the problem and the ramping up of Defense's a resolve to bring change but things settled back to much before China ban civet cats from the market immediately after SARS but later they reappeared with other exotic wild animals the legacy of 9/11 is stringent airport purity Americans found they had to live with the Patriot Act which has remained in place other cities in the world are vigilant against potential terrorists violence the financial crisis which was a deeply painful experience for America is seemingly forgotten the financial industry is more tightly regulated the average American will say nothing much has changed in their lives and many got poorer now the IMF has predicted the pandemic will trigger the worst recession since the Great Depression coughing the 2008 global financial crisis we will see major economic restructuring job losses will be painful staggering and tragic we will see international collaborations step up to find a vaccine but national competitiveness in biomedical sciences will return wealthier countries may increase the expenditure on health care on health care but improve stockpiles but poorer countries but will not be able to do so a think-tank or a consultancy will come up with a pandemic readiness index technology use would be accelerated and further developed and ecommerce already gaining ground will step up people will be more interested in working from home and want flexible working hours supply chains will be reconfigured but that was already happening before the pandemic because of the us-china trade war the pandemic has seen a return to the state sorry the pandemic has seen the return of the state as a positive force where societies have argued for shrinking government more than ever the pandemic has shown that decisive and active government can better deal with controlling the corona virus outbreak in the matter of geopolitics we will see emerging trends accelerated particularly the us-china rivalry I believe the importance of the human connection has been brought clearly into relief during our lockdown and though we connect online we need to socialize to meet and gather we will go to the shops and there will be pent-up demand for travel again do not so soon let me leave you with this thought over the long term the disruption caused by technological development to the way we live work play and learn will be deeper and more severe than the disruption by kovat ninety Yuval Harari in a hot talk interview in may twenty twenty says the biggest change he sees wrought by kovat 19 is that when we look back decades later we will see this moment as the watershed when the world accepted the use of surveillance technology in the name of health as normal and surveillance under the skin which is a totally new thing this means a touch of the finger on a smartphone registers a person's body temperature and blood pressure under the skin and people talk of implanting microchips now let me move to the second challenge democracy falters let me begin with the discussion on democracy because there has been a great deal of interest in this topic lately we are hearing a steady stream of voices from the West suggesting democracy has failed and asking why it has failed now at the end of World War two the United States and Europe emerged the winners of the war the Soviet Union was technically on the winning side too as one of the allies in the military alliance to defeat Germany and Japan but it was an uneasy alliance and the iron curtain came down soon after soon after and the Cold War officially began the world thereafter divided into two camps the alliance of pro West's free market democracies and the alliance of centrally planned command economies of the communist countries most of us grew up at a time when America was one of two superpowers be striding the world actively promoting his values in the fight for independence during the process of decolonization the strongest argument nationalists used was the right to run their own sovereign democratic governments colonial powers favored players who chose a moderate constitutional path as the nationalists they would work with for the next 50 years after the end of World War two democracy and communism were rival systems for the hearts and minds of the new states in various regions in the world the collapse of the Soviet Union in 1992 for many politicians and intellectuals in Western countries was the triumph of the West and Francis Fukuyama declared prematurely it was the end of history it was a triumph of democracy over communism today we hear a great deal about a crisis in democracy in the United States and Europe where the systems were born and evolved it is not the first time that both continents have mourned for democracy the rise of fascism in the 30s prompted the same dark forebodings and spawned many explanations now a fresh loop of books has appeared how democracies die democracies enchain how democracies how democracy ends rupture the crisis of liberal democracy can democracy survive global capitalism democracy and its crisis to name a few you saw the slide which came out a bit too soon but nevermind then there is a rich list of publications on digital democracy and how in the age of rapid technological change the arrival of deep technology technology is threatened the very principles of democracy in their applications thus the West is going through the self-examination and angst again the question is why what does this tell us about societies and what lessons must Singapore be alert to with developments halfway around the world it used to be that the failure of democracy was associated with newly independent states in the developing world which could not cope with the implementation of the imported system there have been many cases of military coos overthrowing constitutional governments but returning to some form of parliamentary democracy after a period of time and in the practice of democracy there are varying models for is acharya in the future of freedom points to the reality that there are liberal democracies and ill liberal democracies now there is an ongoing debate in the countries that begat democracy expressing dissatisfaction with the democratic system as it is practiced in a sense is strengthened it speaks to the strength of the democratic system and that there is the existence of a healthy discourse to find improvement the election of Donald Trump as president of the United States brexit and extreme populist politics popping up in so many countries have raised questions about the health of democracy is institutions processes and even the very idea of liberalism itself now let me be clear I am NOT saying Western democracy is faltering because of any single individual the trajectory of US politics were set before president Trump came into the picture his election was facilitated by highly polarizing debate loss of Tolerance evaporating trust for the political system patent inequalities extreme Ella gay Asians online online and the swirl of post truth facts or fake facts brexit raises questions about referendums and party politics as well as the ability of democracies to absorb globalization and immigration the Pew Research Center in a poll in 2018 across 27 countries found more people dissatisfied than satisfied with the way democracy works and I present two figures for you what these two figures tell us is that there is general dissatisfaction with the way democracy is working I hope you can see this figure 1 shows the top 12 countries that are not satisfied with democracy with the United States and United Kingdom among them the four most dissatisfied countries were Mexico Greece Brazil and Spain surprisingly Japan is on the list now dissatisfaction with democracy is said to be often linked with the country's economic situation the satisfaction is also linked to whether the ordinary people think elected officials care what people think in Greece 84% did not think officials cared can have the next slide please Argentina 75% Spain 76% and in the United States 71% of those surveyed did not think elected officials care about the people so what went wrong first of all people react to forces shaping their lives and the economy then there are country specific narratives that affect people's perception of the political system there is no doubt that from the end of the 20th century the full force of globalization and technology left them on society and country's globalization brought the world together increased trade spurred growth and speeded the movement of people across borders but globalization has a dark side they're winners and there are losers globalization assured in the supply chain revolution it worked for the effective and competitive companies and the ambitious who could make connections globally manufacturing goods selling goods selling services but large numbers of workers in the older industrialized countries found their factories moving overseas and their jobs and communities disrupted furthermore technology effectively created productive increased productivity and more jobs were displaced in fact it has been argued that technology has displaced more jobs than globalization to the job anxiety that is the added aggravation from increased migration many Americans felt it in Europe the wave of refugees strain the openness towards new immigrants over time the numbers look threatening and fears of lost identity us-versus-them mentality took hold our segment of the electorate America first and brexit were political responses to these issues in European democracies right-wing anti-immigrant parties emerged and seemed to poll well then there is a growing inequality in many countries according to the Federal Reserve data in 2018 the richest 10% in the United States held 70% of total household wealth in 1989 it was 60% of the total household wealth now the next 50 to 90 percentile received a share of 29% over the same period and the bottom 50% so essentially zero net gains over 30 years during which that total share of Wealth's went down from 4 percent to 1 percent now this is startling in a country known to provide opportunities and hope for his people the wealth gap shows up in Britain as well from April to April 2016 to March 2018 the top three wealth deciles held 76 percent of all wealth in Britain while the bottom 3 wealth deciles held 2% the top 10 percent share of total wealth was 45% largely unchanged over ten years to these general trends that feel dissatisfaction we can add the politics of individual countries that has given the impression that democracy has degraded the institutions and leaders are not performing in the United States Congress is gridlocked politics is Pro polarized there is is an inability of the Democrats and the Republicans to work together and shutdowns of Congress are more often and for longer periods over funding bills in the Clinton administration Congress shut down for 21 days in 1995 to 1996 over opposition to his spending cuts the showdown during the Obama presidency over the Patient Protection and the effective Affordable Care Act last 216 days in the Trump administration in 2019 18 to 2019 there was a 35 days shutdown the longest in US history over funding for the expansion of the us-mexico border barrier a shutdown means some services will not be funded and temporarily stopped finally the way power has been real by President Trump has sent American academics and commentators into overdrive to analyze him British politicians have left the world breathless at how the country's constitutional future was decided by a simple majority vote in a referendum and how long it took the leaders and Parliament to pass the legislation on brexit described by the British national media as bumbling and fumbling the fact that brexit actually happened had some cheering that democracy had won in Spain they had four general elections in four years yet parties could not form a coalition in 2019 so much so that 90% of the electorate polled expressed anger at the politicians for their inability to form a government little wonder then that the Adelman Trust Barometer shows that trust in elected leaders has been eroded severely interestingly countries in Asia still have trust in their politicians and in Singapore trust level is high 70 percent as a table below shows Western democracies did not do so well look at that chart we are only beginning to appreciate the value of trust in the functioning of democracy and good government Oh before I go on I should point out China short 1990 India 81 Indonesia 75 Singapore 70 Thailand 60% you know trust so but the a lot of the Western countries are in red on the other side Francis Fukuyama highlights trust as an element of social capital that helped some countries to organize and prosper here I am talking of trust in the political institutions political processes and the political leaders which makes which make negotiations and working out compromises achieve abhar this is necessary in a democracy and good governance in the recession of 1984 and 85 in Singapore Singapore leaders manage to persuade workers to accept a cut in the CPF to preserve the jobs and keep investors in the country at that time employers contributed 25% to CPF and employees 25% the PAP government added that if the economy improved the CPF cuts would be restored CPF was gradually restored but never up to 25% however the other benefits and opportunities kicked in when the economy grow and people accepted it much has been spoken of how social media has exponentially rendered governance more difficult George Yeo a former foreign minister in the 24th Gordon Arthur Ransome oration eloquently described the impact of social media which creates echo chambers fragmenting society but also reintegrates and combines the elements into new notes in the networks with new identities based on ethnicity and religion it is no wonder people take to the streets to express their anger at the system the yellow vests in Paris protesters in Hong Kong the young demonstrators in Iran after yet the Ukrainian plane was shot down and the Yuna and in the United States today they are the ongoing black lives matter protests that exploded into countrywide race riots in cities following the death of Josh florid it is a cry for justice from the judicial and law and order system for African Americans if democracies are faltering can they be fixed some writers ask traumatically if in Western democracies the people can recognize when the system is performing at supper and what they know the system is dying a slow e a slow death you can say the political system is not performing optimally but you know my sense is that American democracy can survive any individual or any collection of people's misuse the system is strong it needs fixing however it is not just about changing leaders it is reforming the process as well which is complicated now at a Chicago council conference on global cities a couple of years ago I made the point that the essence of democracy is government responsiveness to people you know my statement resonated with the audience in the room it is not the Schumpeterian idea of alternation of power between two competing parties power can pass between governing party and opposition and nothing changes for the people people must know leaders are listening and responding to their greatest interests and needs and the institution's can deliver that ends my discussion on democracy let me move on to the third challenge which is capitalism capitalism flounders now when Thomas Piketty published capital in the 21st century his book became an instant hit it became number one on the Amazon best list and/or sold out in many stores it catapulted him to Rockstar status his book appeared at the right time when economists business leaders media commentators politicians and most importantly workers were beginning to question if capitalism as a model as a system works for society and the economy why soul Piketty argues that and i quote him when the rate of return in capital exceeds the rate of growth in output and income as it did in the 19th century and seems likely to do so in the 21st capitalism automatically generates arbitrary and unsustainable inequalities that radically undermine the meritocratic values on which democratic societies are based close calls the problems in the functioning of capitalism was starkly revealed in the global financial meltdown in 2008 and 2009 we started in the United States but spread elsewhere leading to deep recession firstly globalization which had become hyper globalization saw huge flows of capital across borders accompanied by government deregulation advocated by a liberal Washington Consensus at that time and it produced repeated international banking crisis as Carmen Reinhart and Kenneth Rogoff two well-known economists wrote secondly economic growth did not seem to benefit everyone and inequalities were ballooning Occupy Wall Street took place in September 2011 a protest against the bankers finances and corporates and was joined by air pilots postal workers and unions President Obama felt pressed to issue a statement in October that he was working for the 99% and the Occupy Wall Street concept spread in the US and worldwide to Japan Hong Kong Seoul and the European cities on a global Day of Rage it was characterized as the 99% against the 1% what went wrong with capitalism now Branko Milanovic who is the sentinel professor at the London School of Economics pointed out that capitalism has gone through three phases firstly he said it was classical capitalism of the 19th century when fortunes were made from owning not working on you know owning equipment secondly social democratic capitalism was the second phase we saw the growth of welfare states in Europe starting after World War Two and ending in the 1980s softening the hard edges of capitalism now there is the third phase of capitalism liberal capitalism or liberal meritocratic capitalism where rich individuals are capital rich and labour rich in today's liberal meritocratic capitalism there are many professionals executives who draw high salaries because of their talent and expertise as well as income from financial assets the elite is more diverse in gender and ethnicity but this masks the fact of increasing inequality Milanovic argues that the last 40 years has seen the growth of a semi-permanent upper class that is quite cut off from the rest of society so the division in the society grows along with the resentment now when Ray Dalio the billionaire founder of hedge fund Bridgewater associates says and I quote him capitalism is basically not working for the majority of the people that is the reality now when Ray Dalio says that you know capitalism is in trouble he quoted a survey by the Federal Reserve which showed 40 percent of American adults cannot come up with $400 in case of emergency the inequalities are most acute in the United States Europe has seen better income distribution with the Scandinavian countries and Netherlands doing much better President Ma chrome continues to be challenged on the streets by the yellow vests who began by protesting against the increase in fuel taxes and general economic conditions and demands for an increase minimum wage by French writers today worried about the increasing tendency towards extremism across the political spectrum we have entered an era of the spread of populism and populist politics and political populism threatens the market system so what is the solution Piketty came up with radical suggestions not all new he advocates a social state and a progressive income tax a system a tax of 80 percent for those earning for half a million to a million and a 50 to 60% on those earning 200,000 then there's an annual wealth tax of 10% on large fortunes and a one-time 20% tax on lower levels of existing wealth now some of you watching this program may in fact be wondering wow you know what you would really like to do is to have a global tax on capital but he admits that this is hard to implement these ideas I think will not fly president Francois along tried a 75% super tax and had to roll it back to 45% as less tax revenue was collected because of less economic growth and capital flights in the United States there is talk of a return to socialism in some quarters expectantly Democrats have a more positive view of socialism than Republicans and younger Americans aged 18 to 29 in 2018 expressed a more positive view about socialism than capitalism 54% to 51 percent to 45 percent still overall Americans from 30 and above and that is a majority are fully supportive of capitalism frankly I think not many Americans understand what socialism really means that may explain why Bernie Sanders though he seventy-eight years old one support from young people then more support then Pete Buddha judge simply because he advocates small socialists inspired policies now Glenn Hubbard chairman of the Council of Economic Advisers under President George W Bush makes more modest suggestions than Piketty or Sanders in an opinion piece in The Economist titled America needs to fix capitalism to save it he argues firmly that one of the roles of an economic system is to improve standards and to deliver prosperity widely Hubbard suggests introducing policies that provide greater opportunity for the people and boost social insurance to expand capitalism's benefits the country should invest in community colleges fund basic science increase Earned Income Tax Credit and boost the demand for labor with subsidies to employers sounds a bit like work fair to me he also argues for more insurance support for the unemployed for longer periods and that there should be federal intervention for wage insurance for older workers Hubbard advocates that if workers can be compensated for unemployment why not compensate workers if they move to a job with lower pay interesting the Trump presidency has not defined the problems this way president Trump has relied on tax cuts cutting better trade deals reducing trade deficits to create more jobs and presumably to help redistribution he has had some success in creating more jobs but there is little evidence that the corporation's have shared the savings from tax cuts to increase the wages of their employees on a large scale the covent 19 pandemic however has wiped out all that and the claims for unemployment benefits are at a historic high as I am speaking many of you may think what I've said about the West finds faint a echoes in Singapore let me say now we are not the same many of our policies have anticipated some of these problems and I intend to discuss this in my third lecture on Singapore which examines how Singapore deals with the transitions and change in systems and structures so I may not be as dystopian as my title suggests and you can leave the hall this evening feeling less dark now the final challenge World Order and gravels for more than 70 years we have lived and prospered by the american-led liberal international order and a Pax Americana in the asia-pacific there was a predictability and a certainty about the established order that order is changing the rise of China and his impact is what countries in the international community are responding to how China behaves how the u.s. behaves and the responses of the region and the rest of the world will shape the emerging new order we are concerned with the shape of the new world order the values and norms that will prevail but more importantly how we reach there in December 1991 the United States emerged as the world's sole superpower the hegemon leading the post-cold-war order many scholars in America would argue that the unipolar moment was brief whether the United States held to his head Germanic status globally is disputed by many who point to the fact that the United States needed the Coalition of the Willing to fight wars overseas and for the legitimation of its interventions this burgeoning debt became an issue for Congress especially the Republicans which placed restrict on the administration's budget expenditure especially in defense in spite of two wars Afghanistan and Iraq the deep financial crisis and recession there is no doubt the United States possesses the capability to project military power in every region of the globe but it's domestic base no longer supports unilateral wars and the question America's global leadership role when there are many problems back home which need fixing there is a sense that there has been a quick unraveling of the established liberal international order in recent years why is this so let me first take a step back to highlight an important point made by John Mishima from the University of Chicago Mishima argues that the liberal international order existed only after the end of the Cold War when the u.s. emerged the habit a German from World War two to the end of the Cold War there were two bounded orders one led by the US and his friends and allies the other by the Soviet Union and their friends and allies the values of the u.s. bounded order included liberal values such as free markets free trade and free movement of capital free movement of people's democracy and freedoms and built Martin lateral institutions such as the UN GATT WTO World Bank and IMF it was an order built on strong military alliances it was also realist and included some authoritarian regimes who were anti-communist it excluded the Soviet Union and China the Soviet Union had is bounded order of allies and partners based on shared ideological goals and military and security objectives then there was an area of shared order which brought the United States and the in Union together as it was in in the interest of both superpowers to prevent proliferation of nuclear powers it was not until the end of the Cold War and the u.s. emergence as the world's hegemon that we saw the creation of the liberal international order the West led by the u.s. launched a policy of promotion of democracy and human rights globally China and Russia were included in this order and they were allowed to participate in the institution's China's growth and rise was greatly helped by this inclusion presidents Clinton and Bush both worked in their administrations to have China admitted into WTO in fact China has done extremely well in the liberal international order to development started the unraveling of the existing order and pushed towards a rapid restructuring of the new order the election of Donald Trump as the 45th president of the United States and the election of seating thing as the president of the PRC you know the facts president Trump advocated an America first and make America great again approach in all his policies and came into office distinctly negative 2 as multilateralism and multilateral agreements he pulled the United States out of trans-pacific partnership TPP and the transatlantic trade and investment partnership TTIP the Paris agreement on climate change and his administration blocked the appointment of the remaining judge to the WTO appellate body compromising its work Trump remains ambivalent towards NATO insisting all his allies shoulder a larger share of the defense burden renewed his demand as recently as 2019 and 2020 that Japan and South Korea pay more for the US military presence Japan was asked to quadruple their annual payments and South Korea to pay five times more than they do now for the US military presence he has forced the renegotiate renegotiation of trade agreements NAFTA into the u.s. Mexico Canada agreement and the United States Korea free trade agreement he has weaponized tariffs using them for non trade issues on Mexico to secure that cooperation on immigration when the largest economy in the world takes this direction it can be destabilizing for the rest on May 19 in the midst of the corona virus pandemic President Trump announced the termination of his relationship with WTO and his intention to eliminate American funding and for his Acharya in a commentary called this hegemony abuse so has the Financial Times and The Economist I have said this in a previous article that those of us in the world order business have been blindsided we thought it would be the rising power that would break the world order we did not expect the established order to be the one tearing down his own rules President Xi Jingping came into office as a leader of a more confident China he came in offering ambitious visions a China dream for the Chinese people belt and road initiative for the world accompanied by a IIb but it was a made in China 2025 that was seen to be the direct threat to the US economy and security in combination the last three initiatives sent the message to the West that China was taking steps to reshape the existing liberal international order the fact that is stepped up is activity in the South China Sea claims militarizing the area steadily from 2008 caused unease in the region although us in countries and China are working on the code of conduct Chinese naval ships are still active pushing us increments in the waters and at the start of 2020 was confronting Indonesia a non claimant state over the sovereignty of waters around Jakarta Sario islands in the South China Sea the dynamics of the restructuring of the international order has been unleashed more speedily and intensely than anticipated Chinese participants and international forums have said many times that China did not have a hand in shaping the rules and institutions of the current international order which is why it did not rise to the idea that Bob Zoellick put forward that China become a responsible stakeholder it is interesting that some Chinese academics make the point that China does not want to tear down the international order but it wants to make some changes to institutions reflecting China's economic position and that of other powers which have similarly developed now there's a debate going on in China on what sort of role China will play and should play in world affairs the kovat 19 pandemic offered China a unique opportunity to step into the role of global leadership given the absence of the United States on this issue the u.s. caught unprepared has been struggling with a chaotic response to the corona virus this has further filled the rivalry given the direction the us-china relationship has taken John Mishima predicts a return to two bounded orders as occurred after World War two only this time it will be the United States and China Mishima argues that in the common shared order would be the space where the economic rules would be worked out at the time of writing in June 2020 the Trump administration looks determined to unwind the liberal International order force a hard read decoupling and returned to two bounded orders but technology and trade are not so easily separated it was easier during the Cold War because the the United States and the Soviet Union did not trade extensively now China and the United States have thick economic relations which ideology cannot undo yet the signs are that the u.s. is determined to force this rule will they succeed well the two bounded orders re-emerge now that depends on whether allies will line up unambiguously the European Union would want to preserve a role for itself as a pole and it is well known that there are differences between the United States and Europe on major issues at this time so there could be three poles or perhaps two and a half poles it is not certain to that China wants to confine itself to a clearly bounded order well order is unraveling my own sense is that the changing world order will look a lot Messier before it becomes clearer and I will take you through this in greater detail in lectures 2 & 3 thank you thank you so much professor time for an amazing tour through the global landscape covering so many important themes there are many questions that have come in for you becoming in thick and fast we will not have time to do every single one of them for which I apologize ahead of time but I've worked hard to try and group them all together into themes and an important theme that has emerged I can see that this audience is wonders greatly concerned about democracy and our understanding they see that this is something that's hugely important for the world and for themselves so I'm gonna ask you prophet Ronnie by me a number of questions on the theme of democracy first and they're not broaden that out to some of the other other issues you've come in part of your point on democracy is that it is not we should not have a halo rose-tinted view often it does not solve all our problems and you've recited the facts about capitalism covet at a range of things when it has failed part of a push back as it were from the audience's hasn't really is the idea of democracy really at fault or is it just the way that has been implemented in the world so well you you reflect a bit on on answering that let me give some examples which the audience says has brought out they say you know democracy what's wrong with it it's meant to be a level playing field a democracy one person one vote is the ultimate level playing field it is something that equalizes opportunity everyone has a shot especially in the poorer and you are right to point out profit on that the larger Western democracies have been dismal and dealing with Cauvery 19 the US UK at the very top of the league tables for confirmed cases and deaths but let's not forget smaller democracies have actually done relatively well Singapore is one instance of that New Zealand is another so it's not that you know our coffee nineteen experience it's a taint on democracy it's at eight on specific ways that it's been done that then it's been taken forwards so may just mention some names can this time in the audience time Joy Hague and white sheet you are with an emphasis on the u.s. electoral college there's a push back on maybe a tooth the five view of democracy so I'd like to get your response to that before I go on to some other questions thank you very much Kenneth and I thank the audience for their questions and for challenging me first of all let me say that I'm not against democracy I am for democracy in fact I say that you know the strength of democracy is that this discourse is coming out what I'm quoting and what I am reading is what scholars liberal scholars in Western countries in the United States in Europe in Britain doing examining why democracy has failed in the West and they want to fix it and I think it can be fixed and I agree with those who say that is it really that you know do we can we tweak it I think you can tweak it is it people is it individuals that make democracy that make democracy that the great democracy shall we say part of that is technology so is a question of how you save the system I think in the end as Winston Churchill says democracy is still the best system after all else has been tried so when I raised this discussion it's not that I want to down democracy please don't get me wrong in fact I come out saying that I think American democracy is strong you know and what we see and all the criticisms that are leveled on it you know I think it will survive no matter what you say is how do you tweak it and what do you have to do so it's a question of do people change it if you get rid of a good a set of people does it make a difference do you still have to do something else you see and it is polarization of views and it is how I guess party politics uses a process so I am not against democracy I am questioning how it has been used and if it is the structure that allows it to be used badly how do you fix that structure I hope that was able at because I am NOT against democracy and I said that it is a good thing that democracy allows this kind of discussion not at all thank you thank you prophet - ever great clarification let me pick up on that thread of thinking because it transfer well with something that you say that Chicago Council the essence of democracy is the government's responsiveness to begin and of course well-functioning democracy is carry their property but generally paying in the audience may be a little mischievously points out that non-democracies also have that feature so she says China is not a democracy but the people report great trust in the government and that trust comes from how they have seen the government respond to their wishes with is the middle class wanting to stamp out corruption or a range of other other similar similar areas of of contention so the pynx statement is non democracy is also are responsive to people how do you view those states then you know I guess I go for good governance you know in the end democracies in them you know democracy allows for good governance but that democracy does not necessarily ensure good governance but if you have good governance you can bet your sweet life there is some degree of democracy and accountability there I will put it that way yes I have not brought in it is true some non democracies in fact do respond to people but there are other issues as well I think human rights you know I'm only talking of responsiveness to people's needs so there there is more than just you know responding I think I'm reacting to what is the strong criticism of Western democracies no matter who you vote in that doesn't seem to be any policy change you know so alternation of power which is Schumpeterian and all of us grew up studying that you know doesn't ensure that you change anything because it could be Tweedledum and Tweedledee and both parties are a bit alike and they just fighting you know you don't see much change so how do you ensure that democracy must be responsive to people I and I said democracy must ensure this you see but there are territorial systems that also do this but there are other features that come with authoritarian governments I think you may write this one oh yeah and I don't know if we'll come back to that conversation later on in your remaining two lectures I hope we do but there's another very interesting branch that comes off of this statement about responsiveness to people okay and this is from Christopher G of IPs but also certainly billion arm and the number of others in the audience and they are trying to day and I are putting together a number of things that you've said rough time one is this Chicago Council statement the essence of democracy government responsiveness to people but in your Straits Times op-ed you also said you don't think over 19 will necessarily lead to such a great transformation now here's where I think some people are having some issues trying to put these two together because for many observers coffee 90 has really real a lot of the flaws in modernity in modern society and for them these people they are impassioned about changing the system for the better so they want to put together the profit on hanky who says democracy is done in response enough to people to argue against the champion Qi who says coffee 90 might not be such a great transformation because they say this time really is different this time people are suffering so badly they need the strong state a crisis is a terrible thing to waste how do we make the best use of this crisis to transform societies and governments for the better I thought that would come up you know when I use the word great transformation I really do need a great transformation in historical terms over decades you know and in fact Jared Diamond the guy who wrote Guns Germs and Steel called over 19 a Bagatelle you know something not very important you know it's not as important as nuclear war depletion of resources climate change and I think inequality he considers that very important so after a while Cove it will pass but in my lecture on Singapore I will return to this because I feel that kovin hits Singapore differently because of the nature of Singapore first you know well I'll be talking about this you are a country that is so dependent on trade the reconfiguration of the supply chains but when I look globally and over historical time I I just think that you know there's a lot of people hyperventilating about some a lot of great changes that are going to happen but there are equally a group of urban ologist and so on to say wait a minute don't underestimate the difficulty of changing human behavior so it is at one level the level of I guess the great transformation over years you know I'm talking of that now transformation in Singapore and don't waste a crisis yes you know I I know exactly where these questions are coming from and I do agree with them that this Cove 8:19 has brought up in fact all the points about the foreign workers you know the situation and I think that's being addressed and a good thing it is being addressed but I'm putting it on I'm speaking on a global scale and over a longer period so when I come to Singapore I will say that in nineteen however has a deeper impression and meaning for Singapore mmm that last call so that's how I am talking globally now and because I've been look some of and you've on her Ari - he thinks he thinks in eons you know and she looks at I guess centuries and the projection of time you know I guess also is because when I look back at all the other crises we really reverted a lot to norm with some changes we internalize some changes so you know I think this Cove it will last next year you know once that it won't we won't change our behavior - there's a vaccine you know when there's a vaccine we will travel things will be opening up much more and people are talking of one and a half years to get the vaccine so let me just be conservative and push it to next year end of next year or middle of next year then after that we will start changing and I think the economic recovery will be the hardest one for everybody globally will it take ten years like the Great Depression or will it be faster so I guess I have seen how the global financial crisis bounced back much quicker than we thought I saw the Asian financial crisis bounce back much faster than we thought and if you look at 9/11 got over it you know so I'm taking that historical recent record to guide my thinking but I would say Singapore is different because we are located because of Jos strategic location because we're a island nation and it really is the whole way trade is being reconfigured that will impact on us you know so I will touch on that when I come to the third lecture yeah I mean exactly to say Snapple situation terms of travel tourism some very critical industries to Singapore's economy will be effective and there will be adjustment and uh but I think there's also a concern among from some of these questions as you're picking up on larger global changes you know this the change that we had been promised when we went after the top one percent the change they've been promised when we did Occupy Wall Street why hasn't that come and I think you've given us a good set of reasons a good set of of touch points in history that say that well you know that didn't happen but they might be that we could still argue about that when saj happened it was basically over in four months if not less and then we had the sharpest rise in singapore weaken our main activity in all recorded history the global financial crisis was massive on the seeker steals we're talking about now massive but but it was not personal it happened out there happened with financial collateralization see the old squares and large financial institutions and in some ways all peoples are abdicated on that we said youth the treasury you the financial regulator fix it and they didn't but this time this time coffee nineteen it is personal to a degree that none of these previous crises were because we see people around us affected we see the rising numbers in our community so maybe anyway this just to say maybe I'm a little bit more hopeful then there will be changed but we'll have to see but certainly in Singapore there will be now there are lots more questions about democracy and I want you to press and then yeah yeah but there are also questions about well order and I desperately want you to speak a bit about this well but let me finish I'll let you finish and then I'll come back to some questions on well okay something is happening to I'm watching the black lives matter you know the race riot hmm and what is happening in the discussion on race in the US I really do hope it moves the needle and that that would be changes yeah we will see yeah we'll see he was and I mean and then also you know fits uneasily in the taxonomy that we're building because America has said a long time over a hundred fifty years since the end of the civil war it says the civil rights movement it has the 1960s and it's still the problem oh my gosh better still look like the rights thing again you see yeah yeah oh is awakened the it's being reflected in other societies too that there's a problem of racism so this is an enduring issue I think this is one of the most to me is one of the most powerful recent issues to you emerge you seek of it touches on all of us a lot of people are going to lose jobs so it touches on each one of us you know some people fell ill not a lot of people fell ill but they lost jobs I think that is the main thing is how we really deal with this issue so we got used to you know working from home you know this cyber-physical combination we're going into a blended city online/offline you know but it is the job loss that is we really have to tackle and what do you do with the increase inequality that will come with it so no no I'm aware of that but I'm taking a more historical view of the larger trends you know and because there are different schools of thought you know and I know most people are saying is fantastic this is going to cause a lot of changes and people are going to go all digital I was speaking to a group of European but knowledge ease and I'm scratching my head really you know in our part of the world not so easy and you've got to possess the technology too so yeah so I I am maybe a bit more skeptical about this great transformation that's happening but the Singapore case is a very particular case because of what covin has revealed yes absolutely absolutely now you know you've covered for for you know these four great challenges we've spent a lot of time talking about democracy ineffective Jane because that's why the audience is interested in when audience is also asking questions about some of your other topics so I feel that we should touch on on those have a bit of discussion on those so if I may can I switch the focus a little bit to the world order the the image that you've described when you when you recount John Mearsheimer extreme realist view of the world there are two great competing powers and we're in this facilities type world where the great powers do what they will the rest of us suffer what we must and I know that that's not that's way oversimplifying the some great challenges ahead for us but one of the questions one of the questions that we come out from Nevada from IPS and others cysts in your view how do you sing how does Singapore how do the the Middle States generally fit into that picture not least given that is Singapore New Zealand Vietnam the Middle States there have been very successful in dealing with corporate nineteen shouldn't this now be time for them to take on more of global leadership not just leave it to the great powers actually I was hoping to do that in lecture three you know because I think these bubbles that are being developed for small states or middle sized states are beginning to feel they have some agency it's a question of how much pressure they can you know take on but we are also seeing bubbles being attempted but you know because of the second wave people are going a little back on the bubble the stuff of the Australia New Zealand has been bubble but it's not actually implemented yet so people are quite cautious but and Australia wanted to bring in Fiji now that's a geostrategic dimension there you see so I see that if these bubbles develop airbridges develop it can in fact impact and develop into certain you know a certain grouping a certain grouping that can work for itself can we take leadership I think there's leadership over different things and in a funny way Singapore has enjoyed a sense of leadership of people turn to Singapore for leadership in ways we that surprised us and which we don't understand why but they do look to us to how we manage the economy how do we make things so successful and I was constantly asked about this when I was in the United States and they were absolutely surprised to find you and not a middle-sized state and I will have tables and figures to show you know there was a low e power index which also measured that Singapore has far more influence than we think so small States can influence you influence in specific areas you specialize in areas so if you look at leadership in different areas it you can say small states take leadership in innovation where there's in health care now you can split it in that way but I guess the leadership that one looks at global leadership is the larger security issues and the economic issues how you shake the world economy and how you shape the security in the world yes well States trying to have a say to and I think you know and I will be talking about the different groupings that are being attempted exactly but your self for example is a wonderful one because it also points us in the direction of saying maybe the way we traditionally think about what great powers are in terms of their footprint the population the military size that GDP and so on I mean that's not the right way to think about what truly great powers are because knowledge expertise you know the ability to take care of your people those are hugely important and in terms of the size of that metaphorical footprint Singapore might only have five and a half million people but that footprint is extremely large and maybe we'll order to gravitate towards that kind of an assessment rather than the traditional one there are more questions pressing you on this and it might be I prov trying I'm gonna just say these questions it might be that you'll say in the interest of timers you move on because you'll cover this later but there seem I expect there's huge interest in what you've already said about US China and this shifting world order you know my whole second lecture is on I know people are already stressing you I was and I want to talk about the technology war and so on but you know I want to save that for the second lecture if I do everything now oh my goodness I was told 15 minutes 55 minutes you know so okay so so maybe I'll hold off with apology I'm gonna apologize you tomorrow Krishna covent a victor Mills and and enough of others yeah I'm not gonna pick up when they're questions now safe therefore that for the next time because I think there was other appropriate for us China I wanted to bring into the discussion some of the other things that you've raised inequality in particular and you've described sort of the the angst and and the sense of the stare so many people have and rightly so if I were an American and I lived in the world's richest most powerful nation and I won over the bottom 50% and I realized that over the last half century my Crombie well-being has not moved at all I would be a little bit upset because that's not how a great democracy takes care of its people so there's some questions on this that point about the 50% disaffection it's really a point about what's happening at the lower end of the income distribution but what's happening to the poor because inequality in China has risen even more than inequality in the United States but the bottom 50% in China have seen very incomes rise even faster than the incomes of the top 10% in the US so 150 percent has been lifted tremendously so is it really about inequality or is it really about taking care of the vulnerable in society those need not always be the same thing um you know I think inequality is really a global issue is a big issue as I said sharat diamond thinks this is global inequality is really one of the big issues of our times and you can see this everyone is saying this and I fully believe it and you know inequality is a moving goalpost I feel you never fulfilled it you know the gaps are always there and every society has to work towards eliminating inequality because the goalpost moves you think you've done enough hey the top brackets have moved further the top tiers so you have to move the you know the bottom rungs so you always have to address the issue and it is global and something ability issue social is social mobility is not just inequality youhelp is the mobility you know do you see mobility and I think that is the main the main point very many surveys show that you know in Asian countries young people have hope they think they can move up that you interview your you know young people same age group in Europe in America they don't think they will do as well so that really impacts on an individual's perception of society and the future I think you know in equality has really in many ways damaged this gross inequality American democracy apart from the polarization and so on and the fact that Americans now realize it I don't know how they're going to fix it you know they have to fix it and now that you have I was reading Jamie Dimon also came up JP Morgan's chairman saying that you know we really have to solve the inequality there's a lot of you know talk about it but what do they do about it those who think hard like Ray Dalio has put a lot of money apparently in education community education so they're targeting that but I think maybe it has to be a much broader program a larger program but inequality is an issue that impacts on democracy really you know apart from technology and how you use a technology and so on but so I've highlighted that frankly that is one of the key issues the other thing that people will say social media is a way you know and the 24/7 cable TV and how you polarize views and therefore it doesn't work and how ethnicities and identities are enhanced because people read the same join the same chat books chat groups go into the same web sites well that's one way of explaining it but I think the inequality issue is big in the United States and jobs is jobs and even equality and race now that's been highlighted a big deal and there's a there's a vicious cycle that can be set up because this affection with the system makes people turn away from it makes people less willing to participate in it actually blocks off the avenues for their own betterment bettering themselves through the system and what you've described by saying you know touches on so many of the important things that we need to fix in highly unequal societies Terrence Lee in the audience asked the question that I think you know that if you address which is how do we put the populism genie back in the bar it's now been unleashed it's causing all kinds of further social destruction we need to work on the virtuous cycle I yes I think you need to work on a virtuous cycle and it's got to be the economic opportunities and the way distribution takes place but once something is unleashed a force is unleashed we all know we are students of social forces they take a couple of decades before they peter out you know but what helps it so I think it will be there but addressing exactly these issues of redistribution of jobs you know of looking after those who are left behind I think that's extremely important actually we're running out of time tough time I would like to to ask one more question and this is a question that I'm going to expand from something but controi hearing posted I'm going to expand it to cut across all four of these challenges so the question has to do with with you know views of individual society democracy but it's a really a question about Eastern this is Western world views you know as we look upon cover 19 we look at these destructions on trade on democracy and so on there appears to be emerging a kind of geographical statement east and west where does the east-west worldview separation fit in your description of where the world stands now you know I I see that there is a difference in the cultures but I don't want to use it to the sense of saying that different worlds you know because I do believe in global communication to say one world is a bit you know is almost innocent and naive but I I don't want to stress the differences that much because I do believe some values are shared but if you're looking at Kovac where do we stand now and you know the cultures east west you know I was reading about you know people are questioning liberalism in the West and they say liberalism emphasizes individual liberty and freedoms and doesn't emphasize so much common good and that's why liberalism is not so effective in supporting or pushing to correct inequalities and redistribution now that very same emphasis on individual rights and freedoms which is very much in the DNA of you know Western countries many of them say why should I wear a mask you know why should I listen to my government you say that you have to stay in and you know I this is my freedom if I want to get coded I'll get Kovac you know so I think in Asia that would be less of that you know I don't think people will say this so blatantly you know and they will comply comply more I put this to a communitarian culture but you are right in an earlier point you said small democracies like New Zealand what's very well to but I think they are also because it is a smaller democracy there are features of a communitarian awareness that is not communitarian in the Asian sense it is a small community you know each other you know and I'm sure the Maori culture too impacts on it thank you for that I'll say question I mean is that what you always think that it's a very open-ended question and there's lots more we can dive into that you're right on I mean just a quick observation on New Zealand Prime Minister are doing through well Facebook wise conversations like the one we're having now did a lot to build a communitarian spirit in New Zealand so there is a very important point that we will need to do reflect on going forwards listen when she looting in the moss when she came out of it absolutely absolutely absolutely and he every time I speak to you I cannot stop because I learned so much the density of new learning per unit time is just unbounded as far as I'm concerned but non-free we've reached the end of our time I want to thank everyone in the audience for their attention I want to thank everyone who's asked questions I know there were many more I never got to so apologies to those whose questions I did not get to mention but I hope you will all come back to ask questions again in the subsequent lectures in this series now normally at this point I would turn to the audience in the room and invite everyone to join me in thanking the speaker for the sparkling presentation and the wonderful conversation that we've got but since this is all ritual we don't get any immediate feedback from the audience I will just thank you ambassador professor my good friend Hankey for just such a delightful one enough one and a half hours I thank you on the behalf of everyone in the audience thank you very much let me now hand the time over to kai-shan who will close out the session thank you prof car and thank you porch and for the lecture we've come to the end of the today's lecture we would like to share your view on the event please click on a link on our Facebook comment to submit your feedback professor chance second lecture will take place on 1st July details will be on our website and Facebook page we hope to see you then thank you all for attending this evening lecture good night thank you [Music]

Channel: Institute of Policy Studies (IPS), Singapore

Views: 4,346

Rating: 4.6862745 out of 5

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Id: FqyI5Hw7du8

Length: 92min 42sec (5562 seconds)

Published: Thu Jun 18 2020