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00:00Hello, Telesur English presents a new episode of China Now, a webmedia production that showcases
00:14the culture, technology and politics of the Asian giant.
00:17In this first segment, China currents dive into the top stories of the week, including
00:22Donald Trump saying on December 2024, after winning the presidential elections in the
00:26US, that China and North America can solve the problems of the world, but the US is not
00:32in a position to negotiate cooperation for its national debt of 36 trillion dollars,
00:38which is a current problem to the world.
00:40So let's go deep in this topic.
00:47China Currents is a weekly news talk show from China to the world.
00:50We cover viral news about China every week and also give you the newest updates on China's
00:56cutting edge technologies.
00:58Let's get started.
01:07In December 2022, after winning the election, Donald Trump made a significant statement
01:13at a press conference.
01:15He said China and the United States can together solve all the problems of the world.
01:20Many people thought this meant Trump would try to work with China during his second term.
01:25However, the reality is that the United States isn't in a strong position to negotiate
01:30cooperation.
01:31Instead, it finds itself asking for China's help.
01:35The reason is simple.
01:36The US national debt, which stands at 36 trillion dollars, is the largest problem in the world
01:43right now.
01:44The United States cannot solve this issue on its own.
01:47Meanwhile, around the same time, China announced a policy that might be able to end the US
01:52dollar hegemony and reshape the global economy.
01:56On the 12th of December 2024, they called for a moderately loose monetary policy.
02:02This is a significant change as China only used a similar approach after the 2008 financial
02:08crisis, from 2009 to 2011.
02:11Essentially, the Chinese government plans to raise funds by issuing long-term government
02:16bonds.
02:17They intend to use these funds to upgrade China's industries and help the global economy
02:22recover from the looming US national debt crisis.
02:26This strategy has been proving effective.
02:29In November 2008, the Chinese government introduced a 586 billion dollar plan by issuing government
02:37bonds.
02:38A portion of this investment went into building high-speed rail, ports, and airports.
02:44Another part was lent to Chinese tech companies at low interest rates, particularly in new
02:49energy, telecommunications, and semiconductors.
02:54This is where China has the potential to significantly impact the US economy.
02:59For example, starting in 2009, Huawei dramatically increased its research and development spending.
03:06By 2012, its research and development budget reached $4.8 billion, making up 10% of its
03:12annual revenue.
03:14That same year, Huawei launched its first smartphone, the Ascend D1, marking its entry
03:20into the global high-end smartphone market and completing its industrial upgrade.
03:25For China, Huawei's upgrade boosted its workforce from 80,000 to 140,000, with 55% of these
03:33employees working in research and development.
03:36This created new income for at least 60,000 families.
03:40Additionally, Huawei generated significant foreign exchange.
03:44In 2022, the company's global sale revenue reached $99.18 billion, which was $11 billion
03:51more than Switzerland's GDP for that year.
03:54Huawei smartphones offer similar performance to Western brand, but are often priced lower.
04:00This affordability has allowed people in developing countries to access modern communication technologies,
04:07contributing to their economic growth through the internet.
04:10By 2023, Huawei had connected 19 million people in remote areas across 80 countries to the
04:16internet for the first time.
04:19This connectivity has opened up new export opportunities for South America and Africa,
04:24even if they don't sell directly to China, as they now have stronger bargaining power
04:29with European and US retailers.
04:31Huawei has been important in helping developing countries start their own tech companies.
04:37For example, a market research firm predicts that the Philippines' data center market
04:41will reach $635 million by 2027.
04:46Instead of completing directly, Huawei provided equipment to the local telecom company Coverage
04:52ICT Solutions.
04:54Huawei's network equipment is much smaller, 70% less space than competitors, which lower
05:00the retail cost in Expensa Malena.
05:03This has given the company Coverage a competitive advantage.
05:07By June 2023, Coverage has captured 54% of the Philippines' fiber-to-home market, keeping
05:14the benefits of this growth within the country.
05:17This shows that with a loose monetary policy, China's growing tech companies have created
05:22jobs and business opportunities.
05:24They've also helped boost the global economy by reducing the digital divide around the
05:29world.
05:30At the same time, China's industrial upgrade could challenge the dominance of the US dollar.
05:35In the past, the US managed its debt crisis because the dollar was tied to oil.
05:40Developing countries had to use dollar to buy oil for manufacturing and transportation,
05:45which kept the dollar strong.
05:47However, three important industries that China is developing could eventually change this
05:52oil-dollar system.
05:53First, the key industry is electric vehicles, which greatly reduce the need for oil in transportation.
06:00In China, 50% of vehicles sold are already electric.
06:04According to the International Energy Agency, more than half of all cars worldwide will
06:09be electric by 2035.
06:12By 2023, 60% of global EVs were made in China, placing the country at the forefront of a
06:18future transportation system that doesn't rely on oil.
06:22Notably, China's top EV manufacturer BYD launched its first all-electric sedan, the
06:29XINXIN, in 2012, thanks to previous industrial upgrade in the country.
06:34The second key area is renewable energy technologies, which reduce the need for fossil fuel to generate
06:40electricity.
06:41Since 2012, China has led the world in installing solar power, fully integrating it into the
06:47electrical grid.
06:48The cost of generating electricity has dropped by 70% since then, making energy much cheaper
06:54for Chinese manufacturers.
06:56For example, in Ningxia province, 87% of solar power generated is sold in the market,
07:03with a cost of just 2.5 cents per kilowatt hour.
07:07By comparison, the lowest electricity price in the US, in Louisiana, is 11.93 cents per
07:14kilowatt hour.
07:15In China, wherever the sun shines, affordable non-oil electricity is available.
07:21China is also tackling the main challenges of solar power, like weather dependency and
07:25land use.
07:27On 31 December 2024, the country launched its first offshore solar power plant in Jiangsu
07:33province.
07:35This plant combines solar power, hydrogen production, and energy storage, generating
07:40400 megawatts of electricity.
07:43During the day, any extra electricity is used to turn seawater into hydrogen gas.
07:49On cloudy days or at night, this stored hydrogen provides stable electricity, helping industries
07:54move away from fossil fuel.
07:56Third, China has the world's most advanced grid technology, which allows efficient transfer
08:02of wind and solar energy from remote areas to more developed regions.
08:07This means even people living far away can benefit from the green economy.
08:11China has about 1.4 billion people, with most living in the eastern coastal areas, leading
08:17to electricity shortages there.
08:20Meanwhile, the western regions have plenty of hydro and wind energy, but have low population
08:25density and are less industrialized.
08:28To solve this problem, China built a 3,000km power grid to send clean energy to the eastern
08:34provinces, using ultra-high voltage technology to minimize energy loss during transmission.
08:40This not only provides income for the western provinces, but also helps the east rely less
08:45on fossil fuel for power.
08:47Since 2009, China's steady progress in these three key areas has allowed it to produce
08:53and transport goods using much less oil.
08:56By 2023, China's industrial output made up about one-third of global production, and
09:02the United Nations Industrial Development Organization expect this share to rise to 45%
09:08by 2030.
09:10This means that if Beijing decides to stop using the US dollar, it could lead to a significant
09:15reduction in the dollar oil system.
09:18China is also promoting this oil-free energy system around the world.
09:22Africa, for example, has great weather conditions and is ideal for developing solar power.
09:28Over the past three years, China's solar panel supplier, Jingkou Solar, has delivered
09:33solar panels and energy storage systems to 45 African countries.
09:38In September 2024, China completed a 100 MW solar power plant project in South Africa,
09:46which will provide 480 GWh of clean energy each year, enough to power 200,000 households.
09:55In the same month, China also announced plans to build 30 additional clean energy projects
10:00across Africa.
10:01By fostering green transitions in developing countries, the world not only reduces carbon
10:06dioxide emission, but also moves towards a future less reliant on the oil-dollar system.
10:12Reflecting back on China's monetary policy, 16 years has passed since 2008, during which
10:18we've witnessed the rise and flourishing of the new tech giants like Huawei, DJI, and
10:24BYD.
10:25As a result, cutting-edge technologies are becoming increasingly affordable for a broader
10:30population.
10:32Looking ahead, China envisions that everyone will enjoy a more modern lifestyle in the
10:36next 16 years.
10:38And that is all for today.
10:39Thank you for watching this episode of China Currents.
10:42If you have any thoughts or comments about our show, please reach us at the email address
10:45below and see you next time.
11:01We'll have a short break, but don't go away because we'll be right back, stay with us.
11:26Welcome back to China Now.
11:27Today's Thinkers' Forum welcomes economist John Ross, professor of economics Kei Yujin,
11:34and theoretical physicist Ron Young.
11:37Let's have a look.
11:48The reason that China's economy has slowed down is very simple.
11:52The investment has been falling significantly in China.
11:58This is hidden by the fact of what is called, in economic terms, gross fixed investment.
12:03That is the total level of investment.
12:05But you have to subtract from that depreciation because a certain amount of capital wears
12:10out each year.
12:11And as China's accumulated capital stock becomes bigger and bigger, the depreciation increases.
12:17So the level of investment, gross investment in the economy, has remained pretty much the
12:22same, slightly over 40%.
12:26But the percentage of depreciation in the economy has gone up considerably.
12:30That means if we go back to 2007, the net investment in China's economy was about 25%
12:36of GDP, and it's now fallen to 15% of GDP.
12:41Well if investment falls by 10%, well then the economy is going to slow down greatly.
12:46Because you have huge confusion in the Western media, which says what from an economic point
12:52of view are completely illiterate things.
12:54For example, you read in the Western media such things as consumption accounts for 66%
12:59of GDP growth, but this is not true.
13:03Consumption always accounts for 0% of GDP growth, because consumption is not an input
13:08into production.
13:09If something is an input into production, then it is by definition not consumption.
13:15What that really means is that 66% of the economy is consumed.
13:19That's correct.
13:20But the contribution of consumption to the production is always exactly zero.
13:25We don't need to look to try to measure it each year, because it never contributes anything
13:30to the development of production.
13:32And therefore you have a very confused type of terminology on this.
13:37Or let's take, again you read it, people, you read in the Western media, China should
13:42increase consumption.
13:43Well, this could mean two quite different things.
13:46Lurking behind these words is an ambiguity.
13:50One could be that you need to increase the living standard of the population.
13:55That means it's actual consumption more rapidly.
13:57This is a very important goal.
13:59If say people's consumption goes up by 5% a year, this is much better than if their
14:04consumption goes up by 2% a year.
14:07But the second thing it could mean is that what you have to do is increase the percentage
14:12of consumption in GDP.
14:14But that number doesn't matter at all.
14:16Nobody eats a percentage.
14:18And if you really want a very, very high percentage of consumption in GDP, then you should look
14:22at countries like the Central African Republic or Zimbabwe or something like that, where
14:27you can have 90% of the economy is consumed.
14:30And these are amongst the poorest countries in the world.
14:33And not merely is this confused, but the two things move in opposite directions.
14:38One of the recent studies which we published was to show this, is to show that the percentage
14:43of consumption in GDP and the growth rate of consumption are negatively correlated.
14:49That means the higher the percentage of consumption in GDP, the more slowly the people's consumption
14:56is going to grow.
14:57So all these Western people are saying China should increase consumption, by which they
15:03mean China should increase the percentage of consumption in GDP, are actually going
15:07to lead to living standards growing more slowly in China.
15:11Because the higher becomes the percentage of consumption in GDP, the more slowly the
15:17people's consumption will grow.
15:20This is elementary economics.
15:21You should know this after about six weeks of a school economics class.
15:27But you have completely illiterate economic things which appear regularly in the Western
15:34media, because they can't really admit to what is the fact of the situation, which is
15:40that China has a better economic development strategy than they do.
15:44Because that would destroy myths of Western superiority, white superiority.
15:50They can't imagine it.
15:52The point is, I've made the point, is that China has not merely outperformed the West,
15:57the Western economies materially, that is, it grows more rapidly, out-thought them as
16:01well.
16:02But its economic policies are more intelligent than those of the West.
16:06I mean, let's take the ridiculous thing of the so-called Nobel Prize for Economics, which
16:11is not actually a Nobel Prize, but anyway, leave that on one side.
16:15This should be absolutely boring.
16:17It should be only the question of which Chinese economist has won it this year.
16:22Because China for the 40 years has had the most rapid economic growth of any country
16:28in the whole of human history.
16:29That's not an exaggeration.
16:31That's just a fact.
16:33Did China grow with no theory?
16:35Well, if you can have the most successful economy in the world with no theory, well,
16:40then all the economics departments in the world, universities, should be shut down,
16:44because they're a waste of resources, because you don't need a theory in order to grow,
16:49if that's the case.
16:50Now, obviously, China has an economic theory, has extremely sophisticated economic theories.
16:55And these are the most successful.
16:56So the only question should be which of these Chinese economists is given the Nobel Prize.
17:01So instead, what you have is a ridiculous situation where people who are engaged in
17:05some small field of economics in the West are given this, and the people who actually
17:11produce the practical results, which is the economists in China, don't get it.
17:16So it's a sort of mad world, in which the people who are successful don't receive the
17:20prizes, and the people who are unsuccessful do receive the prizes.
17:24And this is just because of, you know, Western arrogance, capitalist propaganda, whatever
17:31you want to say.
17:32But it's nuts once you begin to think about the situation.
17:35Let's look at what is the exact situation in the Chinese economy today.
17:39What is the most crucial question?
17:42I think the most crucial question is the profitability situation.
17:46This is the biggest problem.
17:47There's a lot of discussion about consumption, which is confused.
17:50The biggest objective problem is that company profitability has not increased for over
17:56five years.
17:57And this explains many of the trends which exist at the present time.
18:03For example, if we take last year, the increase in state investment is rather reasonable,
18:08about slightly over 6%.
18:10But private investment didn't go up at all.
18:13Why not?
18:14Because private investment only takes place when there is increase in profitability.
18:18And if profitability is not going up, there's no reason why investment should go up.
18:22Look at the situation in the stock exchange.
18:24I know recently there was a huge boost in the stock share prices due to the government's
18:29stimulus.
18:30But if we take, let's say, the last four or five years, it hasn't gone up.
18:34But there's no reason why it should.
18:36If profitability is not going up, there is no reason why the share price should go up.
18:41So therefore, you have a slightly peculiar situation whereby a socialist country has
18:49to aid its private sector.
18:52But the advice which is being given by the West damages the private sector, because what
18:58the West is saying, let's say the Financial Times, Wall Street Journal, etc., etc., is
19:04that China should be increasing consumption.
19:07Well, if you increase consumption, particularly by making wages rise more rapidly than GDP,
19:13then you will cut profitability.
19:15So you've got a peculiar situation whereby the advice which is coming in from the Western
19:20media, which is to increase the percentage of consumption in GDP, is actually damaging
19:26the private sector within China.
19:29And therefore, you have a real situation in which the Chinese government needs to aid
19:35the private sector.
19:37But it's not in the way that the West says.
19:39The West says the big problem about the private sector is that it's not sure of property rights,
19:44etc.
19:45This is a lot of nonsense, because the Chinese economy, private investment, grew very rapidly
19:50for a very long time, in which you had exactly the same property rights as you have now.
19:55So that's not what's causing the problem.
19:57What's causing the problem in the economy is that the profitability is not going up.
20:02And this is what should be being discussed in the West.
20:05But the reason it's not discussed is simple, because if you discussed that the real problem
20:12that has to be addressed, looked at, is the question of profitability, then you would
20:16be led to the exactly opposite conclusion, to the one that what needs to be done is to
20:21raise the percentage of consumption in GDP.
20:26So therefore, the Western debate is greatly confusing the situation.
20:31And you have a very, it's a very paradoxical situation, that what really the private sector
20:37needs in China is the aid which is given by the socialist government.
20:42And what is damaging for the private sector in China is the advice which is being given
20:46by the West.
20:48That's a bit of a paradox, but that's the actual situation which we have.
20:52If you want to boost company profitability, the fundamental target you need to do is,
21:01I would say, that real wages should grow about half a percent slower than the growth of GDP.
21:08What that would mean is, therefore, that resources were gradually being transferred into profitability.
21:15This would not be negative from the point of the living standards of the population,
21:19because the economy would grow more fast.
21:23And therefore, obviously, let's say, for example, if the economy grows at 3% and the real wages
21:29grow at 3%, this is not as good as, say, if the economy grows at 6% and the real wages
21:36grow at 5.5%.
21:38What's important for people, it's not the percentage, it's the real increase.
21:42So what has happened is that consumption has risen in the economy, and real wages have
21:48grown faster than GDP, and this is, therefore, putting pressure on company profitability.
21:54And you're not going to turn round the situation of private investment.
21:58China's state sector can invest regardless of what is the level of profitability.
22:03That's why the state economy, state investment, goes up.
22:06I don't advocate that.
22:07I think that the state-owned companies should be profitable.
22:10But it could do, in principle, continue to increase investment even when the profitability
22:15is not very high.
22:16But the private sector can't.
22:18The private sector will only increase its investment if its profits are going up.
22:22And therefore, there is not going to be a recovery of private investment in China until
22:27there is an increase in profitability.
22:30Similarly, while you can have short-term boosts to share prices, there will not be a sustained
22:36increase in share prices until the profitability of the companies started going up.
22:42So that, it's not the discussion about consumption.
22:45This is a confused discussion, utterly wrong ideas in many cases.
22:49And anyway, it's not really the central issue.
22:52The real central issue in the economy is how to revive the profitability of the companies
22:59because that hasn't gone up for five years.
23:01And that's what's producing some negative trends.
23:05But we've got to be clear.
23:06China's economy is still growing at 5% a year.
23:09The US economy is growing at slightly over 2%.
23:12And Europe is growing at 1% a year.
23:14So when we talk about problems, they're relative problems.
23:18China's economy is still doing much, much better than the Western economies.
23:22That's why all this talk about peak China and economic crisis in China.
23:27Well, any Western economy would be, if it grew at 5%, it would be ecstatically pleased
23:32with the situation.
23:33So is it the case there are no problems in China's economy?
23:36No, obviously not.
23:37But these problems are far less than the problems in the Western economy.
23:41And you have to address what are the real problems.
23:43Not the fake problems, which is what has been discussed.
23:46Most of the discussion which takes place in the Financial Times or the Wall Street Journal
23:51or something is completely foolish.
23:54Now actually, this is nothing new.
23:56My main source of income was I advised companies.
23:59And I know how inaccurate the Financial Times or the Wall Street Journal or the Economist
24:04are.
24:05I made a joke to them, but which is true.
24:08I'm very grateful to the Financial Times because its inaccuracy was how I used to make money,
24:13which they didn't like as a remark, but it is absolutely true.
24:16These companies need accurate information.
24:19They don't get accurate information out of the Financial Times or the Wall Street Journal.
24:24Therefore, this created a space that if you give them accurate information, you are making
24:29money out of the inaccuracy of these, out of these newspapers.
24:33And it was perfectly possible to make a living like that.
24:44China's challenge is that it has shifted from the singular goal of economic development
24:51encapsulated in GDP growth as a quantifiable number to a broader set of objectives that
24:58include social objectives as well as national security objectives.
25:02And indeed, that is part of China's challenge today.
25:05But I think ultimately, it is also a choice and a preference, which could differ from
25:11country to country.
25:12Now, you know, there's the U.S., which is great for trailblazing innovation, but scores
25:19poorly on inequality and many of these social indicators at various levels.
25:24There's Europe, which scores higher on the social aspects, but is not meeting its potential
25:30when it comes to wealth creation and innovation.
25:33And where does China want to be?
25:35Does it want to be more on the U.S. level of decentralized economy and innovation, but
25:42with lots of social problems?
25:43Or does it want to look more like Europe?
25:45I think that that is also part of China's new playbook, as my book is called, on finding
25:51that combination that suits its national characteristics.
25:55So I think this is very much ultimately a learning and a path that has to be tread.
26:01I'm more of the view that you want to unleash the wealth creation at the individual micro
26:08level.
26:10And with that wealth, there are better ways, maybe a better political system, a better
26:14political mechanism to redistribute in ways that you not end up looking like many of the
26:21U.S. problematic aspects.
26:23But absent the wealth creation, there is very little to work with, because I think the lesson
26:28from the Chinese people in the last 40 years is that they're so grateful to reform, they're
26:33so grateful to economic progress.
26:36That's actually what they're most thankful for.
26:39And yes, it can create some turbulence along the way, some bumpy path, and some massive
26:45wealth gathered in the few individuals, because China is a very large country, and it's almost
26:52indicative of meritocracy, where you have a good idea and you become an overnight billionaire.
26:57That's achieved by many in China, but how to tackle the unfair aspects of inequality
27:02is something they can do.
27:04China does not have the lobbying system of the U.S., which also creates a huge amount
27:09of inequity and unfair and unjust outcomes.
27:13It can prevent that, but it should not give up the pro-growth agenda, should not give
27:18up the huge dream and reality that China is one of the few places in the world where you
27:26can actually create massive amounts of wealth.
27:28The U.S. is already at some level of steady state, and their improvements are not orders
27:35of degrees and magnitude different from the past, but a slow, gradual improvement.
27:41And there, you debate about policies, the restrictions on what one can do.
27:45But finally, I think the one difference really is that Chinese government has a long vision,
27:52a longer vision, or can afford a longer horizon vision in not all, but many aspects of the
27:59nation's development.
28:00They think in 20 years, they think in 30 years, because there's continuity.
28:04There's continuity of policy.
28:06There's not going to be this pendulum swing and disruptions.
28:09There's not going to be this intention to deliberately change course from the previous
28:15government because they're party politics or party competition.
28:19There is, on most things, continuity.
28:22But if there needed to be a radical change, there is at least political scope to do it.
28:27Whether they do it or not is a different matter, but it could be potentially more easily implemented.
28:34Because it is an advantage that you can implement strategically important policies without
28:39too much political debate and too much political constraint.
28:43China is a rapidly changing economy, but it's more subtle than just being able to change
28:48policy quickly.
28:50It is that they can start a policy, a reform, or a radical idea, really, in one small place
28:56in China.
28:57If that fails, then we'll just chuck it.
29:00If it actually is successful, then they're gradually rolled out in five provinces, 10
29:06provinces, and then throughout the country.
29:08That was how reform was implemented.
29:10That was how reform was successful.
29:12It was not an overnight change, as in the case of many other transitional countries
29:19like Eastern Europe, because you didn't know whether these policies would be successful
29:23or not, what kind of unexpected consequences they would lead.
29:26China pursued a gradual reform policy development strategy.
29:32And even today, we see that when there are important paradigm shifts or that's needed,
29:40then they shift once they've made up their mind.
29:43And this can avoid some of the longer traps.
29:48The Chinese government has a major dilemma that the U.S. corresponding policymakers do
29:58not face, which is, in today's circumstances, how can you stimulate growth without blowing
30:05up the debt again, right?
30:07That's the main challenge.
30:08And that's why they're being very deliberate and more careful about the approach, because
30:11after 2015, the main objective of the policymakers, central bank, and so forth, is to cool down
30:18an economy that's very easily heated up and very difficult to cool down.
30:22That was the main objective, and hence the monetary tightening that followed.
30:27Today, the main objective is to heat up an economy that is difficult to heat up, but
30:33remains very cool.
30:36But how can you do that without, again, placing a huge amount of debt impositions and challenges
30:43on the local government?
30:44I think that's why they're being cautious.
30:46And the second reason they're being deliberate and cautious is that it's not clear what exactly
30:51works most efficiently and most effectively.
30:55And there are many different kinds of tools.
30:56There could be a coordination between fiscal and monetary policy, it could be about the
30:59real estate property developers, or it could be about directly stimulating the consumers
31:04or service sector.
31:05There are really an infinite combination of policy tools.
31:09The question is, how is it going to trickle to the real economy, rather than just liquidity
31:14kind of being bottled into the financial system, and much of that just used to reduce local
31:20government debt, rather than going into the real economy?
31:24I think that's also part of the challenge.
31:27And on the conceptual level, there is one big difference, which is that the Chinese
31:32government believes that unless you have sustainable wage increases in the long term,
31:38the Chinese people will not consume based on a short-term stimulus, like the hand-to-mouth
31:43checks in the US, or the short-term kind of, what do they call it, revenge spending, or
31:50that kind of phenomenon is not going to pertain to the Chinese people unless they see longer-term
31:56sustainable changes in the living standards.
32:00Now, I still believe that there are ways to get around these challenges, and I do believe
32:06that some of the Keynesian effects could work.
32:09It's just that the Chinese government, and many other governments actually, apart from
32:13the UK and US governments, very few governments are very keen to do large Keynesian type of
32:19stimulus, and that's just a mentality difference.
32:23In the last 20 or 30 years, really 40 years, there's been a tremendous polarization of
32:32wealth in the United States.
32:33In other words, most ordinary Americans have shown little of any economic improvement in
32:3930 or 40 years, which is unprecedented in American society.
32:43In other words, for hundreds of years, Americans have always been more prosperous than their
32:49parents, more prosperous than their grandparents.
32:53And that stopped about 30 or 40 years ago.
32:55So Americans these days, in many cases, are poorer than their parents were, they're poorer
33:00than their grandparents were, and are certainly not growing, not doing well economically anymore.
33:06While on the other hand, the tiny elite wealth, the class of American society, the top 1%,
33:12the top 2%, maybe the top 5% is getting incredibly wealthy by comparison.
33:18And there's a widespread feeling that much of that wealth has been acquired parasitically.
33:23In other words, it's basically that a tiny section of the American public has been getting
33:28much wealthier by really extracting wealth from the rest of the country and making the
33:33rest of the country much poorer, which, you know, is the sort of thing that in many countries
33:37in the last hundreds of years has led to a revolution.
33:40In other words, when you have a tiny elite getting wealthier and wealthier, and the bulk
33:44of the population doing worse and worse over time, at some point, things might boil over
33:49and you might see basically, you know, a violent clash.
33:52And so the fact that, you know, that particular executive was assassinated by somebody, you
33:57know, outraged over the wealth that he and his country, he and his company were extracting
34:02from the American public.
34:03I mean, that's a very dangerous indicator, because, you know, I mean, the fact that so
34:08much of the American public endorsed what he was doing, I mean, there's such a tremendous
34:11dissatisfaction over a lot of these corporations with the healthcare sector being a perfect
34:16example of it.
34:17In other words, you know, we're talking about basically, I think America spends something
34:20like 17 or 18% of its entire GDP on healthcare, and we have some of the worst healthcare results
34:27in the world.
34:28In other words, the average Chinese person lives longer than the average American.
34:33I mean, America is still a much wealthier country, but the Chinese life expectancy is
34:37now longer.
34:39And, you know, Chinese are much healthier than Americans, they're doing much better
34:42than Americans.
34:43And the same thing is certainly true of America's European allies.
34:47In other words, if you look at, for example, a chart showing the amount of money America
34:51is spending on healthcare, and the life expectancy, we're diverging from all of our European allies.
34:59And so, you know, if we're spending all of this money, and we're not getting any results
35:04for it, and, you know, ordinary people are sometimes driven into bankruptcy, or destroyed
35:08economically because their health insurance provider refused to cover the cost of their
35:12services.
35:13I mean, that makes people very, very angry, and, you know, I think we're seeing the
35:17tip of the iceberg.
35:18When you look at, for example, the health problems in the United States, obesity is
35:22a gigantic problem.
35:24Much of it caused probably because of the lobbying of corporations to encourage the
35:29government to support, you know, eating certain food products rather than other food products.
35:34And so, we're talking about an incredibly corrupt society.
35:36I mean, in other words, you know, when you're talking about micro corruption, in other words,
35:41in most parts of the United States, if you get a ticket from the police, you can't bribe
35:46the police.
35:47If you try that, you'll go to prison.
35:48If you try doing, for example, you can't bribe people about zoning permits.
35:53America has very little micro corruption, but it has gigantic macro corruption, corruption
35:58on the topmost level, corruption, you know, on, for example, the national security level,
36:04with so much of our money going to these defense contractors, who, in a sense, are paying off
36:09the government official.
36:10I mean, right now, America's spending probably a trillion dollars a year on defense, and
36:16we can't build artillery shells.
36:18We don't have the industrial capacity to build artillery shells.
36:21I mean, our planes, we're talking about planes that don't fly very well, and the F-35 has
36:26all sorts of problems, and we've spent a trillion dollars a year on defense.
36:31So, I mean, that's a perfect example of why, you know, I'm talking about macro corruption.
36:36In other words, you know, we're talking about huge sectors of the American economy, the
36:40healthcare sector, the defense sector, that are almost entirely controlled by the private
36:46enterprises that profit from them, and in effect, control those sectors of the government
36:51that are designed to regulate or control them, and so, you know, that's why people are more
36:56and more dissatisfied.
36:57So much money being spent.
36:58I mean, we have the gigantic budget deficits, gigantic trade deficits.
37:02I mean, there's a very good chance that the dollar in the American economy might collapse
37:07in the foreseeable future.
37:09I mean, you know, we're talking about a situation that I think is eerily reminiscent of what
37:13America was going through right before the financial collapse of 2008.
37:17I think China, Europe, the rest of the world regarded America as having exactly the right
37:23financial system to follow.
37:25In other words, you know, we were booming, our economy was booming, we had very low employment,
37:30very low problems with the economy, in other words, we were doing very well, and it was
37:34just a house of mirrors.
37:35In other words, basically, a lot of these financial securities that we were issuing,
37:40the mortgage-backed securities, basically were houses of cards, and they all collapsed.
37:45In other words, we damaged the world economy tremendously because of our financial collapse,
37:50And after that, I think China and many other countries in the world became much more cautious
37:57about accepting American advice.
37:59I would look at, for example, the whole notion of cryptocurrency and Bitcoin.
38:03I mean, Bitcoin, I think it's up to like a trillion or $2 trillion of market value.
38:08It's basically, by most reasonable standards, it's a Ponzi scheme.
38:11In other words, it has no intrinsic value.
38:14The only reason it's considered valuable is that people are trading it back and forth.
38:19And some people have certainly become incredibly wealthy by trading Bitcoin, but it has no
38:24underlying value.
38:26And it absorbs tremendous amounts of energy from the United States and the rest of the
38:31world in terms of processing Bitcoins, mining Bitcoin, and at some point, the whole thing
38:36might suddenly collapse, which probably would cause a very deep recession in the United
38:40States.
38:41And so, you know, that's the problem.
38:42In other words, if all these people who have been trading meme stocks, stocks that have
38:46no value, who've been trading, for example, stocks that are driven a stock market bubble,
38:51who've been basically trading Bitcoin with each other, if suddenly they lose all of their
38:56financial assets, America might see tremendous social upheaval of a sort we haven't seen
39:02for generations before.
39:04In a sense, I think there's a good deal of possibility that America is in what might
39:09classically be called a pre-revolutionary situation.
39:13In other words, there's such tremendous dissatisfaction across the country, dissatisfaction that's
39:18been spread for 10 or 20 years.
39:21I mean, you know, again, more and more people are so suspicious of events of the past.
39:27And you know, it's because people basically don't believe the government acts in their
39:31own interest.
39:32They don't believe the government is honest.
39:34And that's why they voted for Donald Trump.
39:35I mean, they voted for Donald Trump in some cases because they supported Donald Trump,
39:39but in many other cases, because they hated the enemies of Donald Trump, the American
39:45establishment.
39:46And that's why if Donald Trump is much less successful than many of them hope, if he ends
39:51up going back on many of his promises, if he ends up doing things that they feel betray
39:56them one more time, that might be the final straw.
39:59And then there really might be, you know, sort of dramatic changes in American society
40:04that happen only very rarely in the country.
40:07Because I mean, so many American people are just so incredibly fed up with so many things
40:13that have happened over the last five or 10 or 20 years that, you know, it's not a healthy
40:18situation for our society.
40:25And this was another episode of Shine On Out, a show that opens a window to the present
40:29and the future of the action giant.
40:30Hope you enjoy it.
40:31See you next time.