DEF IX - Gathering Storm: Cold War II or World War III?
Summary
TLDRHistorian Neil Ferguson discusses Greece's economic recovery since the 2010s, comparing its economic depression and recovery to Germany. He highlights Greece's significant improvements in fiscal health and defense spending. Ferguson warns against Greece's geopolitical complacency, emphasizing the dangers of underestimating threats from Russia and China. He draws parallels between the current geopolitical climate and the Cold War, stressing the importance of manufacturing in prolonged conflicts. Ferguson also warns of the risks associated with US political instability and a potential crisis over Taiwan's semiconductor industry, advocating for Greece to stay vigilant in global politics.
Takeaways
- 🎤 Neil Ferguson addresses the forum, noting the uncomfortable situation of depriving attendees of a break.
- 🔍 He discusses Greece's economic crisis during the 2010s, highlighting a significant drop in per capita GDP and high unemployment rates.
- 📈 Ferguson contrasts Greece's economic recovery with Germany's stability post-financial crisis, emphasizing Greece's fiscal improvements.
- 👑 Prime Minister Kyriakos Mitsotakis is praised for his leadership and Greece's remarkable economic achievements.
- 🌍 Greece's geopolitical position is examined, with Ferguson arguing that Greece cannot be neutral like Switzerland due to historical and current geopolitical tensions.
- 💡 Ferguson references Henry Kissinger's views on a new Cold War with China, emphasizing the increasing dangers of this conflict.
- ⚙️ He discusses the complex global supply chains and the challenges of decoupling the US and Chinese economies.
- 🚢 Greece's involvement in global trade, especially its significant shipping industry and trade relations with China and Russia, is highlighted.
- 💣 The ongoing wars in Ukraine and the Middle East are predicted to continue and potentially escalate, impacting global stability.
- 🛡️ Ferguson emphasizes Greece's defense budget and its importance as a NATO member, while also expressing concerns about US defense spending and its implications for allies.
Q & A
Who is the speaker in the transcript?
-The speaker is Neil Ferguson, a renowned historian.
What is the main theme of Neil Ferguson's speech?
-The main theme of Neil Ferguson's speech is the economic and geopolitical challenges faced by Greece and the broader implications for global stability.
What economic crisis did Greece experience in the 2010s?
-Greece experienced a severe economic crisis in the 2010s, with its per capita GDP plummeting by more than a quarter.
How did Germany's economy compare to Greece's during the same period?
-Germany's economy remained relatively stable with no significant increase in unemployment, in stark contrast to Greece's economic downturn.
What recent fiscal achievement of Greece does Neil Ferguson commend?
-Neil Ferguson commends Greece's recent fiscal and macroeconomic stabilization, noting its improved fiscal position even after the shock of the COVID-19 pandemic.
What geopolitical risks does Neil Ferguson highlight for Greece?
-Neil Ferguson highlights the risks posed by the geopolitical situation in Ukraine and the threat from the People's Republic of China, suggesting that Greece cannot ignore these dangers.
What did Henry Kissinger say about the new Cold War?
-Henry Kissinger stated that we are in the 'foothills of a cold war' and later updated this to the 'mountain passes of a cold war,' indicating an increasingly dangerous geopolitical situation.
What impact does Neil Ferguson foresee from the economic interdependence between the US and China?
-Neil Ferguson suggests that the considerable economic interdependence between the US and China complicates the situation, making decoupling an almost impossible undertaking.
What warning does Neil Ferguson give about potential conflicts involving Taiwan?
-Neil Ferguson warns that a crisis over Taiwan, similar to the Cuban Missile Crisis, could plunge the global economy into a far greater crisis due to the importance of semiconductors produced in Taiwan.
What is Ferguson's view on the political stability of Greece compared to other countries?
-Ferguson views Greece's political stability favorably, especially in comparison to the political turmoil in other countries, such as the UK, which had three prime ministers in one year.
Outlines
🎤 Introduction and Greece's Economic History
The speaker, Neil Ferguson, starts by apologizing for the cancellation of a 10-minute break, leading to discomfort among the audience. He introduces his talk with a focus on Greece's economic hardships in the 2010s, comparing it to Germany's stability. Greece experienced a severe depression with a significant drop in per capita GDP and high unemployment rates. Despite recent improvements, he highlights Greece's previous catastrophic fiscal state and current fiscal health, praising the Greek Prime Minister for the remarkable economic recovery.
🌍 Greece's Geopolitical Reality
The speaker emphasizes Greece's unique geopolitical challenges, arguing it cannot be neutral like Switzerland. He compares Greece's stance on Ukraine and China with other European countries, suggesting a somewhat unrealistic view of its geopolitical situation. Drawing on historical context, he mentions Henry Kissinger's insights into the Cold War, indicating the current global tensions resemble a new Cold War, with significant economic interdependence complicating the geopolitical landscape.
💼 Greece in the Globalized Economy
Focusing on Greece's role in the global economy, the speaker discusses its significant shipping industry and diverse trading partners. He highlights the impact of recent global crises, including the pandemic and the Russian invasion of Ukraine, on international trade networks. The speaker argues that these events illustrate the interconnected nature of global supply chains and the challenges of decoupling major economies, particularly in the context of Greece's trade dependencies.
⚔️ Greece's Defense and Global Manufacturing Shifts
The speaker discusses Greece's defense spending as a NATO member, noting its high budget compared to Germany. He raises concerns about the U.S.'s growing debt and its implications for NATO allies. Highlighting a significant shift in global manufacturing leadership from the U.S. to China, he argues that manufacturing capacity is crucial in prolonged conflicts. He draws parallels between the potential Taiwan conflict and the Cuban Missile Crisis, warning of severe economic repercussions.
🤖 The Uncertainty of U.S. Politics and AI's Impact
Concluding, the speaker cautions about the instability in U.S. politics, especially with the influence of artificial intelligence in elections. He stresses the importance of understanding Greece's geopolitical role and the potential risks of future conflicts. The speaker's overall message is a warning about the interconnected nature of global crises and the need for strategic awareness in navigating these challenges.
Mindmap
Keywords
💡Great Depression
💡GDP (Gross Domestic Product)
💡Unemployment
💡Macroeconomic stabilization
💡Geopolitics
💡Cold War
💡Global supply chains
💡NATO (North Atlantic Treaty Organization)
💡Artificial Intelligence (AI)
💡Taiwan semiconductor crisis
Highlights
Neil Ferguson is introduced as a renowned historian and takes the stage, despite the cancellation of a planned break, placing the audience in a unique position to hear his talk.
Ferguson reflects on Greece's economic recovery, contrasting its 2010s depression with Germany's stability, highlighting Greece's severe GDP drop and high unemployment.
He praises Greece's fiscal recovery and current stability, commending Prime Minister Kyriakos Mitsotakis for his leadership and comparing Greece favorably to other European nations.
Ferguson warns about the dangerous geopolitical climate, suggesting Greece cannot remain neutral like Switzerland and must be aware of its strategic position.
He discusses Greece's economic interdependence, noting its significant trade with China and Russia, and questions Greece's stance on major geopolitical issues like Ukraine and China.
Ferguson emphasizes the importance of understanding history in the context of current geopolitics, referencing Henry Kissinger's views on the Cold War and its modern parallels with China.
He outlines the complexities of modern globalization and supply chains, arguing that decoupling major economies like the US and China is nearly impossible.
The significance of Greece's shipping industry is highlighted, illustrating its deep integration into global trade networks and the impact of recent global shocks.
Ferguson connects the cascade of crises, from the pandemic to the war in Ukraine, to historical patterns, predicting that such conflicts are unlikely to end quickly.
He discusses the prolonged nature of wars and the difficulty of achieving peace once conflicts extend beyond a few months, suggesting current wars are likely to continue.
Ferguson underlines Greece's significant defense spending relative to GDP, particularly in comparison to Germany, and its role in NATO's collective defense.
He raises concerns about the sustainability of US defense spending, pointing out that interest payments on US debt are now exceeding defense budgets, a sign of shifting global power.
Ferguson highlights the shift in global manufacturing leadership from the US to China, stressing the importance of production capabilities in modern conflicts.
He draws parallels between the potential Taiwan crisis and the Cuban Missile Crisis, warning of the severe economic impacts if tensions over Taiwan escalate.
Ferguson concludes by emphasizing the need for Greece to be aware of its geopolitical realities, as it cannot adopt a neutral stance like Switzerland in the current global context.
Transcripts
[Music]
1 2
3
4
[Music]
1 and it's time we have the pleasure to
welcome Neil
Ferguson one of the worst n renowned
historians thank you very
much please take your
seats the floor is yours and it's a
great honor having you
here sorry for this well I um I thought
it was a mistake to announce a 10-minute
break but now that that break has been
cancelled I'm in the uncomfortable
position of depriving you all of the
coffee and sustenance and bathroom
breaks that you were
craving but this is not the least of my
problems because in addition to
depriving you of these
Comforts I'm also going to be a rather
gloomy Oracle those of us who come to
speak at dely feel inclined to be
oracular but I'm afraid my prophecies
will be more
Cassandra than the Oracle at Deli so you
may begin to wish you'd gone for the
10-minute
break I'm only going to speak uh for 19
minutes uh so cross your
legs I want to remind you as this is an
economic
Forum that in the
2010s this country suffered one of the
very few great depressions there have
been since the
1930s if you look at the data from the
international monetary
fund Greece saw per capita gross
domestic product me measured on a
comparative basis Plunge
by more than a
quarter now I just happen to choose
Germany as the economy to compare Greece
with but you can see in these charts
that while Greek per capita GDP crashed
by more than a quarter Germany's barely
missed a beat during the whole period
that followed the global financial
crisis notice too that there was no
increase inre in unemployment in Germany
it continued to
decline whereas in Greece unemployment
Rose uh to a 2013 peak in excess of a
quarter of the labor
force these are Great Depression numbers
that you would find if you studied the
history of the United States or Germany
after
1929 now the recent fiscal and
macroeconomic stabiliz Iz ation of
Greece are causes for real
congratulation you can see on the
leftand side of my
slide that Greece's fiscal position on
the eve and during the financial crisis
was
catastrophic whereas today even after
the shock of the covid-19 pandemic
Greece's public
finances measured by the annual
deficit are incomparable Health to those
of
Germany this is an astonishing
achievement which you should never
understate and it is a pleasure for me
as a native born Britain to congratulate
prime minister kirakos
mitsakis on all that he has achieved it
is a remarkable feat and singles him out
in my view as the most able European
political leader of them
all by comparison it might be said that
some other
countries have been losing their marbles
to use a colloquial English
expression these
days the British look with admiration at
the political stability of Greece when
did you last have three prime ministers
in the space of one
year
however I don't think that the Greeks
can
disregard the increasingly dangerous
geopolitics of this
decade and I have the
feeling that you would like
to but my
message is that Greece
can never be
Switzerland if you look at opinion
polling on two distinct
subjects the situation of
Ukraine and the threat posed by the
People's Republic of
China you will see from these
charts that only
Hungary is less sympathetic to the
plight of Ukraine than Greece in Europe
today and only Hungary is more favorable
in its view of China than
Greece and it seems to me that this
evinces a somewhat delusional view of
Greece's geopolitical
situation ask yourselves in the world
wars of the 20th century was Greece un
scathed could Greece step
aside could Greece be
Switzerland you know your Greek history
and you know that that was not for a
moment
conceivable Henry
Kissinger died last year shortly after
celebrating his 100th birthday
it seems to me that if you want to
understand the geopolitical situation we
find ourselves in he was a reliable
guide no one understood the Cold War
better than Henry
Kissinger I asked him just over four
years ago at a conference in
Beijing if we were in a new Cold War if
China had taken the place of the Soviet
Union and he replied
memorably we are in the foothills of a
cold
war a year later he upgraded that to the
mountain passes of a cold
war and the year before he turned 100
when I asked him about it again he said
the second Cold War will be even more
dangerous than the first because of
course we now have artificial
intelligence as well as nuclear
weapons the great Paradox of the second
cold war is that unlike in the first
there is considerable indeed vast
economic interdependence between the two
rival
superpowers although the US China trade
deficit has come down somewhat since its
peak in the middle uh of the last decade
it Still Remains around a third of the
total us trade deficit and when people
talk of
decoupling I would merely remind you
that for Apple to reduce its production
in China from 100% to 90% of its
Hardware is scarcely decoupling it's
barely even drisking to use the
fashionable word of the
[Music]
time now this is because globalization
is really a complex network of supply
chains and you can see in these
brilliant diagrams from the recent work
of my old friend hung song Shin at the
bank for international settlements just
how complex these networks are to
decouple the two largest economies in
the world from one another when the
supply chains resemble these
kaleidoscopic complex diagrams is an
almost impossible undertaking
let's consider the situation of Greece
in the globalized economy we've just
been hearing about the enormous
importance of Greece's shipping industry
and yes it is important because Greece
as much as any country is bound up in
that International network of Supply
chains the atlas of economic complexity
allows you to
see that Greece has trading partners
everywhere though the destination of its
exports is overwhelmingly European those
are the blue squares on the diagram on
the
left Greece imports from all over the
world but again
predominantly uh from Europe notice
however that in 2021 more than a tenth
of Greek Imports came from
China 6% from Russia and just 2% from
the United
States the implications of Cold War war
two are painfully obvious think only of
the impact of the Russian invasion of
Ukraine uh the following year the year
after these figures were calculated for
Greek
trade the network that I just described
to you a network in which we are all
individually
nodes has come under a sustained series
of
shocks in the space of the last four
years first of course was the
pandemic we almost take for granted that
we can meet here in this crowded
reasonably crowded and somewhat
overheated tent and not a mask is to be
seen and one reason we've begun to
forget the pandemic is the other crises
have come after it thick and fast
in my last book Doom a cheerful title if
ever there was one I argued that in the
wake of the great Public Health disaster
of the pandemic other disasters would
follow in a kind of cascade of
conflicts after the plague I said will
come the war and sure enough war came it
came to
Afghanistan when the sudden abrupt
withdrawal of American forces handed
that country and its people including
many who had cooperated with the US and
its allies back to the tyranny of the
Taliban scenes in Kabul were reminiscent
of the fall of Saigon for those of you
old enough as I am to remember that
black
day and that was just the
first then came the invasion of
Ukraine now this it seems to me is
equivalent to the impact of the Korean
War at the outset of the first Cold War
the first major hot war that makes it
clear that you really have entered a new
era that the interwar period that began
with the collapse of the Soviet Union or
perhaps with gorbachov is well and truly
over the war in Ukraine is a
fundamentally different war in its scale
and intensity
than the wars in the Balkans that
followed the breakup of Yugoslavia it is
a return to a kind of war that Europe
has not seen since
1945 in which the levels of Destruction
and The lethality of the violence really
do recall the Carnage of the world wars
indeed the
battlefields uh of eastern Ukraine
closely resemble those of the first
world war except that drones fly
overhead greatly increasing the accuracy
of weapons and The lethality of the
war that was February
2022 in October last year another war
broke out when a terrorist attack by
Hamas and Palestinian Islamic Jihad wre
Havoc Slaughter and rape on the
population of
Israel the problem about wars is that
unless they are stopped very quickly
they become very hard to stop
indeed if you look at every war that
there's been in the world since 1816
since the period after Napoleon's defeat
it's striking that while many wars are
brief lasting just a few months a really
large proportion of Wars last much
longer than that indeed I would say as a
kind of rule of thumb if a war lasts
longer than months it's highly likely to
last quite a bit longer than one year a
quarter of the wars since 1816 have
lasted more than a year and of these 16
lasted more than two years and four more
than five
years after the opportunities had been
missed to bring an early end to these
conflicts and I believe opportunities
were missed it became progressively
harder with every passing month to
achieve achieve peace in other words you
must expect these wars in Ukraine and in
the Middle East to continue and
potentially to
escalate
Greece as I said ain't
Switzerland and it never will
be now to be fair as an integral member
of the transatlantic Alliance Greece is
one of the very very few European
members of NATO with a serious defense
budget in fact on the latest NATO
figures as a percentage of GDP gree's is
twice that of
Germany and this is an impressive thing
to maintain when you consider the fiscal
challenges that Greece has faced and the
still very large debt that is a hangover
from the previous period of economic
crisis but remember that more than 60%
of total NATO spending is accounted for
by one member and that is the United
States and every member of NATO
including Greece must be very concerned
about the growing
vulnerabilities of that most important
member Ferguson's Law the only law of
History that I
recognize states that when a great power
spends more on interest payments on its
debt than on defense its greatness is
likely to fade if you look at the most
recent Congressional budget offers
projections you can see that this year
is the year when debt payments interest
on the federal debt exceed the US
defense budget for the first time in
American history not only that but by
2040 interest payments are likely to be
twice the size of the defense
budget this is not an encouraging
outlook for any American Ally and that
includes
Greece an even bigger
problem which I think is strikingly
illustrated by this chart is that in the
space of 20 years leadership in global
manufacturing has decisively shifted
from the United States to China in 2004
just a few years after China joined the
World Trade
Organization us manufacturing value
added was more than twice that of
China's by
2022 China's manufacturing value Ed was
twice that of the United States a
profound reversal of economic
fortune and ladies and gentlemen if
there is one thing we have learned from
the war in
Ukraine in a conventional conflict that
has protracted over months and then
years
manufacturing
matters you must be able to supply your
armies with shells and now with drones
on a massive
scale under these circumstances it would
be extraordinar dangerous for the United
States and its allies to risk a Taiwan
semiconductor crisis by analogy with the
Cuban Missile Crisis of
1962 the analog is a good one you know
if you ask Americans what they would do
if China blockaded
Taiwan 62% say that the US Navy should
be sent to run that
blockade
1962 it was the United States that
blockaded an island just off its coasts
Cuba
and it was krov who had to send a naval
Force to run that
blockade it was the closest we came to
World War 3 in the whole of the Cold War
and it is truly fantastic to me that any
policy maker in either Beijing or in
Washington would want to roll the dice
of rerunning the Cuban Missile Crisis
with Taiwan as the
island bear in mind what Cuba's
principal exports were
and still are that's right cigars some
of you may still smoke cigars but you'll
acknowledge that compared with the most
sophisticated C nanometer semiconductors
they're not economically terribly
important a crisis over Taiwan would
plunge the global economy into a far
greater crisis than the global financial
crisis of
2008 because at the very heart of
innovation of artificial intelligence is
tsmc which dominates the production of
the most sophisticated
semiconductors finally and
unfortunately you and America's other
allies cannot count on us politics
especially now that artificial
intelligence will play a part in the
campaigns to deliver greater political
stability
in less than S months
time ladies and gentlemen I warned you
that I would be somewhat Cassandra likee
but I would be neglecting my duty to
Simeon and the other organizers of this
forum if I did not point out that
geopolitics applies to Greece too and it
applies to Greece even more indeed a lot
more than it does to Switzerland thank
you very much indeed
[Applause]
[Music]
1 4
[Music]
Weitere ähnliche Videos ansehen
Heightened Political and Geopolitical Risks
Why JPMorgan CEO Jamie Dimon Is Skeptical of an Economic Soft Landing | WSJ
JPMorgan CEO Jamie Dimon on Inflation, Markets, Fed, China, India
Here's How the Truman Doctrine Established the Cold War | History
Athens Riviera Summit 2024 | Dorothy McAuliffe, Fireside Chat
India Could Dominate the World or “Collapse in on Itself” | Jacob Shapiro
5.0 / 5 (0 votes)