Dr Leslie Vinjamuri
I love an audience that goes quiet just as everybody sits. Hello, welcome to Chatham House. It is – it’s a huge – it’s always a privilege to moderate at Chatham House, but tonight is a very special privilege because we have a tremendous panel. And for those of you who may not be aware, tonight is also a bit of a repeat event in one sense, in that we, for the last few years, have been fortunate to work with and to welcome – and those of you in the audience, how many of you are Georgetown alum, Georgetown School of Foreign Service alum? So, it’s tremendous to have you here. Your alumni, Dean Hellman, of the School of Foreign Service, are all over the world, as we know. And it’s been really a pleasure to work with you, Joel, over many years at Chatham House. So, long may it continue.
And tonight, we obviously have a very exciting group of people to talk to us about a very big topic, “Geopolitics and Global Challenges.” It’s alright there, I’m Leslie Vinjamuri, I direct the US and Americas Programme here at Chatham House.
Sir Nick Clegg, what an honour to have you here.
Sir Nick Clegg
Delighted to be here.
Dr Leslie Vinjamuri
You’ve spoken here many times, but each time it is really tremendous. It’s good to have you back from the other side, from the United States. It’s nice to have you back, as I understand, in the UK, having served as President for Global Affairs at Meta. Obviously having a very distinguished career in Europe and especially here in the UK, which everybody here is very well aware of.
Sir Nick Clegg
Shall we stop now? I’m fine with that. No.
Dr Leslie Vinjamuri
Sir Andrew Steer is probably also very well-known to many of you for your work in the UK Government, in development, at DFID, of course, and most recently leading the Bezos Earth Fund as President and CEO, before the CEO at World Resources Institute. And now I believe you’re also at Georgetown, which is part of the connection, the connectivity on our panel.
Joel Hellman has been at Georgetown for how long?
Dr Joel Hellman
Ten years.
Dr Leslie Vinjamuri
Ten years, and before that was at the World Bank and the European Bank for Reconstruction and Development, for I believe 25 years in total? Working in development, worked in…
Dr Joel Hellman
Hmmm.
Dr Leslie Vinjamuri
…Kenya. And so, really, came to Georgetown, which is America’s number one ranked school for the study of international affairs, which probably means number one in the world, or right up there, and really brought an extraordinary record of public service in the international realm.
So, obviously, we have great experience to address a topic that is, basically, impossible to talk about in a – you know, this is a tough time, let’s face it. So – but what I will say, in preparing for this panel, we had a chat, and I did come off of it unrealistically optimistic. So, I thought something must clearly be wrong, where – in the experiences that you’ve had, or rather, we are missing something that’s actually very important that’s going on. So, I think we will hear some optimistic stories this evening, as well.
I guess where to start. “Geopolitics and Global Challenges,” for those of you who are paying attention, you know that we are living in a very fraught period, where most people believe that the liberal international order, such as we knew it, is basically over. That it was heading in that direction for quite a long time. That there was an attempt to revise it, to change it, to walk it back, to recognise that it no longer recognised the new power realities that we face. But that in recent days and months, that it’s felt like the – one of the key architects has been really driving a sledgehammer through some of its most core aspects.
And for this panel, that becomes, you know, significant, because we want to talk about one of the things that has been really critical to the liberal international order, which was the provision of global public goods. It used to be about providing rules and norms for predictable and stable international trading relations, macroeconomic exchange, development, ideas and norms about sovereignty and when you could infringe on sovereignty, rules for maintaining peace and stability. Obviously, you know, rules that were frequently violated, but at least there was a sense of there being a general rule.
So, now we have a whole new basket of challenges. They’re not as new as some of us think they are. You’ve been working on them for a very long time. Whether it’s artificial intelligence, climate change, development, old and new challenges, and Nick, let me – sorry, Nick, Nick, may I call you Nick?
Sir Nick Clegg
Sure.
Dr Leslie Vinjamuri
May I turn to you first? The US – this US President has said that he would like to see global – the US have ‘technological dominance’. If you are trying to, kind of, set out a platform or a principle or a, sort of, first step towards co-operation, that might be alienating to some of America’s partners. Nonetheless, maybe we could start by each of you, and beginning with you, telling us a little bit about the issue area that you’ve been working on, artificial intelligence and technology, who the key actors are and maybe a little bit about what you were really trying to do, in your case, in the last four years.
Sir Nick Clegg
Golly, that’s rather a lot.
Dr Leslie Vinjamuri
We’re coming onto the governance question after that.
Sir Nick Clegg
So, there are only two powers in the world when it comes to building the, sort of, base layer of artificial intelligence, as it’s come to be known in its latest iteration, it was China and the United States. There are, basically, no other entities on the planet who are able to muster the money, the energy, the data and the infrastructure resources to train the models to create these so-called foundation models, upon which you then build finetuned models, you run inference operations and then – anyway.
But the thing starts with the, sort of, block of AI granite, which is these foundation models, and that’s a very expensive thing to do. It’s expensive financially, in energy terms and so on and so forth, that only the Chinese and the Americans are doing it at any scale. And of course, in the United States, all the major AI labs are all roughly within 50 square miles of each other on the West Coast. So, Amazon, Microsoft, OpenAI, Google and Meta are, basically, the only, sort of, main players. Apple, sort of, dabbling, but doesn’t really quite seem to know what it wants to do in that area.
And the traditional way of exercising American leadership, in this field, as much as any other, as you know better than I do, it was, at least for many decades, for America to assert its power in a, sort of, unilateral fashion, but also to mobilise allied opinion, to populate multilateral institutions, to craft international rules, to serve America’s wider interests. That is now clearly being replaced with this unilateral assertion of American supremacy in the tech area and interestingly, is now buttressed by this fusion between political leadership in the – in D.C. and tech leadership in Silicon Valley. Most dramatically, of course, demonstrated by the photograph of all the leading Silicon Valley figures lined up behind Trump at his inauguration.
And that’s very new, biggest Silicon Valley and D.C., that tech power, that political power, have generally always slightly been wary of each other or pulling in very opposite directions. They’re on opposite sides of that great continent of the United States. Silicon Valley has always looked, sort of, more, certainly in latter years, in a sense, almost across the sea towards the Pacific. D.C. has been much more a, sort of, East Coast culture. It’s an extraordinary thing to now see them working hand in glove and part of it, as expressed both by the Politicians in a Trump administration and by the tech leadership, is in pursuit of a much more muscular, unapologetic assertion of American leadership in this technology area. They are very riled by what they consider to be unnecessary, sort of, perfidious attempts by foreign regulators in Brussels and elsewhere to restrain their freedom of manoeuvre. They feel that the way to beat China is to confront them unilaterally with that technological prowess.
And I – we will see in the next few years where – whether that works or whether both D.C. and Silicon Valley relearn the lesson that I suspect they will, that is however predominant they are in the AI field, it’s going to be quite difficult for them to dictate terms entirely on their own. And the Chinese, if you look at the Chinese AI industry, has responded fascinatingly. I’m not really clear, I don’t know enough about it to know whether this is directed politically from Beijing or whether it’s a function of the fierce commercial and technological competition between the Chinese AI labs. But the Chinese AI labs are now really – and this is quite new, in the last four or five months, are really starting to race ahead in open-sourcing their AI foundation model.
So, this is very important in the geopolitics, which is the subject of an event like this, because if you are in Latin America or Africa or South-East Asia, and you’re trying to work out, “How can I avail myself of these big powerful models?” you are increasingly, in my view, going to be confronted with the choice of either paying an America – for an American model, which is the proprietary model which is the dominant one coming out of Silicon Valley. Interestingly, with the exception of Meta, which has been-open sourcing its models. But with the exception of Meta, the American model has, basically, been their, sort of, pay to play approach to AI. Whereas the Chinese are, basically, saying, you can use them for free. You know, you can use them off the shelf.
And so, you have this extraordinary spectacle that America is, in a sense, turning in on itself and for commercial reasons, most of the major labs are offering these AI models on a commercial proprietary basis. And yet, the democratisation of these powerful models is being promoted, either by accident or by design, by the world’s most powerful non-democracy. It’s a extraordinary constellation of forces and how those play out over the next few years, I think is going to be fascinating to watch. But I would put a fair amount of my own money on open-source AI winning.
Ju – if you look at the whole history of technology, you know, Linux, open-source protocols for encryption, open-source generally wins out against proprietary models. And I suspect will – that that will be the case, too. So, I don’t think everyone’s really got their head round this, is that the – that this powerful technology is being mo – being made available in the most, sort – literally and metaphorically and freely available from China, not from Silicon Valley, and that’s a very big thing if you believe that this technology is going to sweep the world. I wouldn’t be surprised over the next period of time, one of the common standards, basically, is invented in China, not in the – in Silicon Valley, for the reasons I just explained.
Dr Leslie Vinjamuri
Absolutely fascinating and that – and one thing, and we’ll come back to this, is, you know, that the entire conversation, where it used to feel, not very long ago, that the conversation here was very much about governance, about rules, about safety, and that entire conversation feels a little bit like it’s been maybe checked at the door for now. I want to come back to that.
Sir Nick Clegg
Yeah. For what it’s worth, I thi – I mean, I said it publicly, I said it privately, I think the United Kingdom Government wasted a huge amount of time and a huge amount of political capital indulging, basically, a press-driven hysteria about AI extinguishing humanity. When it should’ve actually spent much more time working out how Britain and other European countries can excel in this technology, deploy its sensibi – I think we wasted a ludicrous amount of time, basically, in a, sort of, moral panic.
It doesn’t mean that AI doesn’t have its downsides, doesn’t mean particularly if it develops in a particular direction, it – those safety considero – considerations aren’t important. But it was a real – in my view, it was a political wrong turn and it was driven – as, by the way, is often the case, if you look at the history of new technologies, from the bicycle to the radio, from the internet to television, if you – I mean, books have been written about it, it’s fascinating. You just always see the same pattern of moral panic about new technologies. The Politicians then respond to that, and I think it’s been a great pity, ‘cause I think in our hemisphere, in Europe, in Britain, we’ve wasted a lot of time on that.
Dr Leslie Vinjamuri
We’re definitely coming back to this question, not only of the UK, but of Europe. Andrew, you’ve been working much of your career in development and clearly recently, on questions of climate, from a very important philanthropic position, making big bets. Maybe you could tell us about this, but also in the context of, kind of, where we are now. I mean, many of us are looking at this with great fear that there is damage being done to just people’s basic beliefs in science, in climate science, that there’s a degree of climate denialism that’s been enabled. But you’ve been clearly pushing against that. Can you tell us about the work that you’ve done over the last several years?
Sir Andrew Steer
Well, yes, with pleasure. But first, Leslie, thank you, it is great to be back here in Chatham House. You play such a powerful role and we’re very grateful and it’s fantastic to be here, also, with the Georgetown alums. I’ve only been a Professor at Georgetown for a month, so already I love you guys.
Dr Leslie Vinjamuri
You have to announce that, it is true.
Sir Andrew Steer
So, look, there’s good news and bad news and the bad news is winning at the moment. On the good new – I think if you divide experts on climate and you ask one group, “How’s it going?” they’ll say, “It’s fantastic, it is amazing. Look at technological progress. Do you know, since Jimmy Carter put solar panels on the roof of The White House in 1979, those solar panels now are 99.8% cheaper? And what’s true for solar panels is now tue – true for batteries and many other things. And by the way, lots of good things are happening. Ten years ago, we had the Paris climate deal. Some people think it’s failing, but before the Paris deal, we were heading towards a 4½o Celsius to 5½ – 5o world. We’re now heading towards a 2½o Celsius world. Never before in ten years have we made that much progress. We have 190 countries, minus the United States now, minus a few more, that are committed.”
So, that’s the good news story and that’s half of the experts will tell that story with conviction. The other half will say, “We are lemmings running over a cliff. We’ve already exceeded the 1.5o limit and we know that once you approach 2o, you get into these negative tipping points and then it’s too late to do anything.” And they’ll say, “Look, I opened the Financial Times yesterday, the Government of India and Coal India has announced they are reopening 30 coalmines.” You know, why? Because they claim that renewable energy simply cannot deliver enough. The good news, again, is that actually, and 80% of the world’s surface, it’s actually cheaper to go with wind and solar and nuclear and so on.
So, we have these two situations that are seemingly very inconsistent, and the question is can they both be right? And the answer is yes, they can. And so, if you think of an image, it’s like a dog chasing a bus, and the dog is us doing great things on climate and we’re going faster and faster chasing the bus. And we’ve never done so much, we’re putting more money into it. 80% of all the new electricity generated last year was renewable energy. We never would’ve dreamt of that. The number of electric vehicles is way, way greater than anybody predicted even five years ago. Every single year, the IEA has underestimated how rapidly renewable energy is going to grow.
So, on the one hand, we’ve got that incredible – so, that – this is us, the dog, going faster and faster, very proud of ourselves, but of course, the bus is accelerating away. Every year that passes, the problem gets almost exponentially tougher to do. So, the lesson is, you know, if the dog keeps running faster and faster, it will never catch the bus. It needs a new approach and that’s what we should be talking about.
Sir Nick Clegg
Hmmm.
Sir Andrew Steer
What’s the, sort of, electric scooter that dog can jump on, whereby we attack these issues quite differently? And that’s what Joel is – he’s training a generation of Diplomats that are going to engage in the world to do it differently.
Dr Leslie Vinjamuri
Before I come to Joel…
Sir Andrew Steer
On…
Dr Leslie Vinjamuri
…Andrew…
Sir Andrew Steer
Of course.
Dr Leslie Vinjamuri
…I’m going to – Nick really put the US and China question on the table and has led us to believe, I’m sure accurately, that China at the moment is the democratising force when it comes to AI diffusion. You haven’t said too much about geopolitics. Can – how – you know, what you’ve just told us, how – what are – where is the distribution of, kind of, energy, enthusiasm, where is that ambition coming for – coming from? And can you, you know, talk about…
Sir Andrew Steer
Yeah.
Dr Leslie Vinjamuri
…the US and China in a few sentences?
Sir Andrew Steer
Well, the Paris deal would never have taken place had the United States and China not had a deal together. So too, COP26 in Glasgow wouldn’t have had those amazing breakthroughs had the United States and China not had a deal, and of course, now we don’t have it. And so, the tragedy will be, is if we turn the geopolitical animosity into something that would actually make solving climate change much more difficult. You know, a competition is not bad as long as it leads to more progress. What we really want is something more like the space race than the nuclear race. The nuclear race was mutually heading towards destruction. The space race was actually pushing it forward.
And just as Elon Musk and Jeff Bezos are fighting to get to space sooner, that’s incredibly healthy competition. And at the moment, China is absolutely leading the way, and I hope, but we’ll come onto that later, maybe, I hope we have the political courage to have some deals with China. China, you know, has been much criticised for its so-called Belt and Road, and it used to be highly damaging, but actually, now, it’s doing some pretty good things. Why would we not have a relationship in third countries, where we’d say, if we really, really are serious about climate change, we should be doing it differently?
Dr Leslie Vinjamuri
Joel, you lead a school that is steeped in an understanding and a focus on geopolitics. You bring the development lens over many…
Dr Joel Hellman
Hmmm.
Dr Leslie Vinjamuri
…decades of experience. Can you capture for us the current moment in development? I mean, we look at the headlines and it feels like the US is completely out of the game and that China’s sweeping up the contracts and the work that the United States was pushing forward. Is there a different story? Is that the story – the last time you were here, you started very powerfully by reminding us of, you know, the positive trends, over many decades, on redu – poverty reduction and any other number of metrics. We’re now a couple of years on, a year on, where do things stand? And we’re in a very new position when it comes to US leadership, obviously.
Dr Joel Hellman
Well, it’s great to be here. Thanks for having us again and great to see Georgetown folks here. I have to say the one optimistic thing that I take at the moment is that Georgetown is the ultimate countercyclical bet to global crisis. So, when the world is a mess, it’s fascinating to be at Georgetown, with a group of passionate Scholars, passionate…
Dr Leslie Vinjamuri
Of course.
Dr Joel Hellman
…students, who believe they can change the world and they must change the world.
And I think the starting point is where you began in the discussion, which is that the economic order that has guided the world, for good and ill, for much of the post-war era, is over. I mean, I think it’s – it – there’s no question about it, the core principles, the core foundations of it, have been challenged. We are in a stage in where there is tremendous amount of uncertainty and with that certainty, a tremendous amount of risk, and that we don’t really know where that global order is going to go.
But what concerns me deeply, and I think even what we see in the conversation that we’ve begun here, is that changes in the global order are often founded, as Nick was, sort of, suggesting, on the basis of technological change, often about the way people can do harm or good to each other. So, with a changing technological base, you often have a changing economic and political order around it. That change is happening and that change is being wedged into a bipolar or even – and dare I say, we’re – kind of, a new Cold War model of US-China competition. Linked – you know, as you were suggesting, as they are the two dominant powers in the new technology that’s shaped, they are going to be the key players in climate change. And obviously, that relationship needs to be central to whatever the global economic order and the global political order’s going to be. There’s no question about that. But what deeply concerns me is that outside of that main pillar, the rest of the world, and especially the developing world, has just disappeared…
Sir Nick Clegg
Hmmm.
Dr Joel Hellman
…off the face of the map. You don’t read about what’s happening in development, you don’t hear about it, it’s not being discussed until there’s a war in Sudan or somewhere else in the world.
And going back to something that Leslie said, whatever the problems were of the previous liberal economic order and liberal political order, that era, essentially running from the end of World War II to the COVID pandemic, was the greatest era of human progress the world has ever seen. There ha – there was never a period in global human history in which poverty, global, economic, especially extreme poverty, decreased as quickly and as broadly as the last 70 years, and especially the last 30 years. Every indicator of development, maternal mortality, child mortality, kids in school, women – political rights and engagement, you know, just pandemics and global health, every indicator showed progress.
So, whatever we thought about the liberal economic order, whatever we thought about that, well, it was happening on a base of extreme progress globally around the world, especially in the developing world. That era is now over. Partly it’s over because some of the drivers of that are actually being unravelled. Some purposefully, like global trade, global supply chains, and it was the entry into the global marketplace that really was the driver of this – these extraordinary changes. And we can see the tensions, the autarky, the nationalism, that’s driving that. We – this fixation on a bipolar way of thinking about the world, when everyone else is thinking about much of a multipolar world in which there are lots of important emerging powers who are seeking their voice in the global economic and political order, but to some extent, being drowned out by the US-China…
Sir Nick Clegg
Hmmm.
Dr Joel Hellman
…competition. I actually think of the Cold War and that the talk of a, kind of, new Cold War, it’s dangerous because it’s, essentially, wedging in an order that does not fit a new Cold War paradigm, but it’s a familiar paradigm. I’d describe it as it’s like an old pair of slippers we found in the cupboard and we put them on and go and “I’m – I forgot how comfortable it was” to see the world in this very simplistic terms. It’s us versus them. They have a different system than we do, they have a different politics in EVEs, they have an economics system than we do, and we need to compete against them.
In the meantime, in that competition, what are we not doing? We are radically decreasing the support that we have given to the developing world through aid and assistance, as one component, not the only component. But look what’s happened in the United States. We’ve closed down, for God’s sakes, closed down the US Agency for International Development. 80% of American development assistance has been wiped away through the, essentially, the stroke of an executive order pen. The UK is shifting resources and Europe, across the board, is shifting the resources away from assistance and development in order to deal with the threat – the very real threat, defence threat, posed by Russia. One thing people perhaps didn’t even notice in the new big beautiful budget bill is that Trump is even taxing remittances, which is a – which has been a driver of development even more than aid has been a driver of development, and he wants to tax those remittances.
So, aid is declining, autarky, global supply chain and engaging in global supply chain is coming to pressure, and what’s happening around the world? Global growth rates, especially in lower income countries, are dramatically declining. During COVID, we saw the first rise in global poverty that we have seen in decades. You’re starting to see the development indicators turn in the wrong direction for the first time, again, in decades. And what we are looking at now is a very serious problem of indebtedness. 60% low-income countries are now in debt distress. Two thirds of low-income countries spend more on interest payments than they do on health and education. The US is also among those countries, but that’s another story.
But it means that the drivers of development, whether it’s internal investment, which are going to be constrained because of lower fiscal space, whether it’s aid and assistance, which is now being dramatically reduced, China, which was a major player in investment across the world, through Belt initiatives, has lowered dramatically its investment through Belt and Road in developing countries. All these things are coming together at a time when demographic pressures are going to mean, for the first time, whatever we think about migration now, it’s going to get a hell of a lot worse as more people face poverty in places in which population is increasing.
So, I think that we are, kind of – we are watching a global economic order that is missing one of the central problems that drove the previous global order…
Sir Nick Clegg
Hmmm.
Dr Joel Hellman
…and I’m very worried about it.
Sir Nick Clegg
Hmmm.
Dr Leslie Vinjamuri
Okay, that – I mean, that is the reality check, and I guess I want to come back to you, Nick, because, you know, you – one of the – you said many things. One of them was that there’s a “fusion” now “between the East Coast,” the, sort of, government and – in the US context, in Silicon Valley. But it does still feel like there is, what Joel’s very artfully and masterfully outlined, if depressingly so, a real pessimism about where we’re going in Europe. It comes – you know, in our conversations here at Chatham House, in North-East, the US, liberal institutions, universities, but in Silicon Valley it still feels like maybe there’s a charge. That actually, AI is going to help us solve some of these problems. You are actually fairly optimistic.
Can you, sort of, tell us, Nick, where you think leadership can and should come from? Maybe you want to speak to the question of the UK and Europe, and how bad is this moment in the United States? How…?
Sir Nick Clegg
Hmmm.
Dr Leslie Vinjamuri
To what extent – I mean, you said, you know, China’s getting ahead on, kind of, sharing AI. You were a little bit light touch on your critique of the current moment in the United States. Can you say more about that and are you as pessimistic as Joel is about the prospect for governance and order and rules to manage these transformational things, like artificial intelligence, or do you think it’s all, you know, all to play for and…?
Sir Nick Clegg
No, I’m pretty pessimistic for the – well, look, what we’re experiencing is – well, it’s many things at once. But there’s a tension between two very powerful forces which is driving a lot of this, and it’s the tension between the way in which technology demolishes geography, so the glo – the ongoing globalisation of technology, of which generative AI is the latest and very powerful iteration, and the deglobalisation of politics. Politicians everywhere are building barriers, digging trenches, appealing to the electorates who want a sense of us and them.
So, you’ve got this – the gears of governance are just being chewed up by this collision between the reality of the way in which technology demolishes space and geography and boundaries and perhaps a response to it, the ever more powerful nativist appeal in politics everywhere. Whether you’re Trump or Modi, whether you’re Brexit or Erdoğan, it doesn’t matter. You’re still drawing from the same well spring of anger and insecurity that millions of people feel, that they live in a footloose, fancy free wee – world, which they don’t understand, they can’t control and where they feel they are being injured, and they are victim of it.
And so, the result of that means that you’re having – technology’s being unleashed onto the world, which in a logical environment, would, for instance – like, I mean, it’s just – it’s – I – it’s, sort of – I think it barely should go without, sort of, saying, in a logical world you’d have the major techno democracies outside China, India, Europe and America, working more closely together to try and establish some basic guardrails and swim lanes on the way in which the, kind of, AI era is introduced on the world. And some of it’s quite technical, some of it’s about dataflow, some it’s about – you can – you could share insights on infrastructure design. You could share basic principles on safety and transparency and so on. But at exactly the moment where you need that new form of international statecraft and governance, of course, the politics is pulling you in exactly the opposite direction.
So, of course, for those reasons, I’m pessimistic in a sense that I just don’t think politics is able at the moment to match what is going on in our highly interconnected world, and all I know is that that is unsustainable. What I don’t know is whether that implodes into a conflagration of conflict or whether lessons are learned as mistakes are made. And candidly, I suppose what makes me most disi – sort of, disillusioned by the moment, is not so much ‘cause I’m not American. It’s not so much – well, I mean, in a sense, the American people have made their choice, they made it twice now. They’ve been pretty unambiguous about what they want, or what they appear to want. What is so sad is that in Europe, we have appeared to have completely lost the ability to act as the sum of our parts.
At the very moment where Europe needs to act collectively, for the political reasons I described earlier, all the politics is moving in the opposite direction. And it means that we’re faffing about, pootling around in a Lilliputian manner, in our own little, kind of, you know, tin – we’re tiny countries in Europe. We’re tiny, tiny countries, we are small, medium-sized countries jostling together in this patchwork lovely old battered continent of ours. Pulled apart by history, by religion, by language. We have Russia on the one side, we have the Middle East on the other, we have Africa one side.
We don’t live like America. We don’t live in this lovely safe space where you got great – two great big oceans on east and west and all you’ve got is Mexico and Canada on either side. We live in a very dangerous neighbourhood. If there’s any moment where you need political leadership saying, for heaven’s sake, if we want to be strong, we have to find safety in numbers, and none of that is evident at the moment, none of that is evident. And I find that extremely worrying for future generations.
Dr Leslie Vinjamuri
So, a comment and then a question for all of you. The comment is I don’t think the American story’s over, and I also don’t think that Americans…
Sir Nick Clegg
Ah, no, of course not.
Dr Leslie Vinjamuri
And I know that you don’t – but it has to be on the record, ‘cause we are on the record today. And we all know that Americans continue to evaluate their choices in multiple ways. We already have seen that the feedback loop is different now than it was in the first 100 days, so we’re part of that story and it’s changing and it’s dynamic. And hopefully, the same is true in the UK and across all of Europe.
But I want to ask each of you, including you, Nick, the question about if the leadership isn’t coming from the leaders, the elected leaders, in the way that we wish it to come from, you’ve been leading a major, until recently, philanthropic effort to make a radical positive change in the climate space. You’ve been working for a technology company and presumably you know all of them quite well now and their ambitions to not only drive technological change and capture market share, but potentially, to do good or to do things safely. Anthropic, I guess is, you know, one example of that? And you know the private space very well.
So, are there – if governance is going to come, or rules that care about safety or equality and equity, and that really do drive progress, is the private ambition, is the ambition of private actors something to look to, or is it something to be even more concerned about? Maybe we’ll start with you, Andrew.
Sir Andrew Steer
Well, let’s not give up on the Politicians yet. We just need to bring back the some of the really good ones. So, how about it, Nick?
Dr Leslie Vinjamuri
We have to say independence and not…
Sir Andrew Steer
Of course.
Dr Leslie Vinjamuri
…part of the think tank here at Chatham House.
Sir Andrew Steer
Yeah. So, the answer to your question…
Dr Leslie Vinjamuri
But we agree, of course.
Sir Andrew Steer
…is yes, I believe. I mean, I think we’re going through an extremely interesting phase in development, but certainly in global public goods, like climate change and nature. You actually see the most interesting progress is coming not from multilateral government, the government agreements, although that is nice to have. But much more, sort of, plurilateral multistakeholder, where you have a, sort of, a group of leading private sector players who realise it is actually in their interest to do something. You then have citizens, consumer groups, you’ve got – governments are certainly essential. You’ve now guarded climate change. We now have maybe $20 billion of grants from philanthropic outfits that can inject money smartly and so on. We’ve got financial innovation.
So, if you look at, for example, issues like, you know, how do we decarbonise steel? Very difficult. Well, it’s actually being led by a group of private companies that see the writing on the wall. Now, 25 years ago, they wouldn’t have seen the writing on the wall because we didn’t have the technology. So, that’s why in our field, we are technological optimists, because most technological improvements make it easier to make progress, including AI. I mean, what AI will do for climate and nature is potentially totally stunning.
So, I do think we’ve got a very interesting, sort of, possibility, but like all despots, Mr Trump has identified some truths and then massively exaggerated them. So, I mean, I think he is right to have pointed out that the United Nations actually is not very efficient and every previous effort to reform it has failed. He’s right to point out, actually, even USAID, every previous good leader of that has tried to reform it and it’s been too difficult. So, I do – I think that we actually, just as we need to, sort of, tease out the possibility of these public, private, philanthropic, non-governmental organisations that are pushing things forward in a very exciting way, and there are many, many examples of that, so too we have the opportunity, potentially, of reforming some institutions.
You know, the United Nations has, what, 35 institutions. Mr Trump said, “Why don’t you have four?” Amina Mohammed said, “Well, maybe we could ditch” – she’s number two, “It may be nine.” Well, somebody needs to really think through how do we do that? There’s a – there is a – used the Overton Window here earlier. There is a window of opportunity that may exist now and incidentally, organisations like Chatham House and Georgetown University have a very important role to play in thinking that through.
Dr Leslie Vinjamuri
We clearly do. Let me add a comment and then I want to bring maybe Joel and Nick into conversation on a really important point, before we open it up to all of you, and you will be – it’s livestream, you will be on the record when you ask your questions. Actually, let me just come to the two of you on this question of private interests and the technology – the role of the behemoths, the very powerful leaders of the tech firms, and their power over the US. Is this – does – is there any way to turn this into a story of progress, or this detrimental to democracy and the questions of governance and order, Joel? Or unless you want to say something else about the progress…
Dr Joel Hellman
Well…
Dr Leslie Vinjamuri
…and the private question?
Dr Joel Hellman
…I’m going to leave it to both of these gentlemen to talk about dealing with the behemoths, having dealt with Jeff Bezos and having dealt with Mark Zuckerberg in Facebook. They have changed and in fact, this isn’t – there is, beyond the individual personalities and mega wealth and things like that – as all of the – this panel discussion has, sort of, suggested, whatever this New World Order is going to look like, it is going to be fundamentally different from the previous order. Not only because the nature of the power structure across states has changed, and it has changed and it needs to be recognised, so I don’t want to throw that issue out. We need to recognise in a much more serious way the importance of emerging voices on the international stage that are claiming the power that they deserve because of the progress that they have made over the decades, economic progress, political progress. And you’re starting to see more and more players on the diplomatic stage. The – it’s not just a story anymore of unilateral, you know, strength of even of Cold War competition.
There’s that element of it, but as everyone has since said, there is an in – complex interplay between the private and the public sector. Private sector actors are critical in solving global problems. Private capital and wealth is critical in advancing things. The market itself, understanding the global supply chain is critical to understanding global politics and understanding technological change, which is driven by science, is critical to understanding the change in global politics.
And I don’t think we have a framework for understanding a global order in which private sector actors, in which technological change which is dominated by private sector firms. We’re not in the area of nuclear weaponry or space technology which are – which were driven by governments. Now they’re driven by individual firms. We have to think about an order in which those voices work together in a, kind of, multilateral framework, because they’re global companies, they, kind of, connect countries together. And I think we’re just swimming around to try to figure out what that’s going to look like.
I know what we’re trying to do at Georgetown is prepare a very different generation. So, our largest majors now are in business and global affairs, in science, technology and international affairs. Those are the largest majors at the School of Foreign Service, ‘cause I think the students recognise that unless you understand global supply chains and global finance, you’re not going to understand how to solve climate change and global problems. And the same with migration and same with development issues, and unless you understand how the technology is going to drive politics, you’re not going to understand the global diplomatic order.
So, I think we really need to start thinking about a different global order and I think climate change is probably at the centrepiece of this, because it’s the one that’s driving everyone together for the obvious needs that we’re all impacted. But I think we still haven’t gone beyond that one issue area into something that is a more adorable framework to deal with multiple…
Sir Nick Clegg
Hmmm.
Dr Joel Hellman
…problems.
Sir Nick Clegg
Hmmm.
Dr Leslie Vinjamuri
Nick, can you comment on this? Is it bad for America’s democracy that technol – leaders of AI companies and tech have so much proximity to the corridors of power?
Sir Nick Clegg
I think gen – as a general rule in mature democracies, about the only thing that’s worse than having Politicians and businesses at each other’s throats, is having them in each other’s pockets. So, you want to find something which is in between those two and it’s clearly swung rather violently from one extreme to the other and it needs to find a better equilibrium.
I just – look, I think what Joel said just now is – self-evidently, is right. It’s important that decisionmakers, whether they’re Diplomats or Politicians, need to understand technology better. I think it’s very important. There’s much greater technological and scientific literacy amongst decisionmakers, that’s true, and vice versa. But I don’t think we should look to people who run Big Tech companies to act like philosopher kings. They’re not philosopher kings, they’re businesspeople, they’re Technologists. They’ve got businesses to run and they’ve got other businesses to beat and that’s what motivates them. And we shouldn’t start conferring on them – I mean, however much some of them might pretend that they are, sort of, philosopher kings, they’re not, and they shouldn’t be treated as such, and they shouldn’t – you shouldn’t have those expectations of them.
So, I think, of course, the private sector, civil society, the think tanks, academia, you know, all the rest of us, everything is impor – is an important part of the fabric of society. But in the end, in the absence of any alternative to represent a democracy, we do actually elect people to make decisions and try and make trade-offs between different societal priorities, to, sort of, move things forward. And I just – the only thing I would observe as a, sort of, ex-Politician, is there is nothing that will guarantee greater failure for those who don’t like what’s going on at the moment than by appearing to appeal to some sepia-tinted globalist past. “Can’t we go back to a world where there was global governance?” and so on and so forth. Because it just didn’t work in the eyes of millions and millions and millions of the voting public. It just – it won’t work politically.
So, I think the emphasis that Joel and Andrew put on reforming what we’ve got is essential. And I think what the, kind of – what the Politicians in numerous countries that are dealing with the ferocity of this very powerful, populist, nativist politics, which is on the rise at the moment, is that it will happen, it will happen, because politics abhors a vacuum. But at the moment, I think what is just so – which is – I just know this is not going to work, is if those who are trying to counter that end up themselves appearing rather conservative. And I said – when I was saying ‘conservative’, I mean the literal word of conservative, that they’re trying to conserve something which they think has been lost.
Dr Joel Hellman
Hmmm hmm.
Sir Nick Clegg
That is a political cemetery, I guarantee you that. It will appeal to – well, it’ll appeal to us at Chatham House and nobody else.
Dr Leslie Vinjamuri
Sorry, unfair.
Sir Nick Clegg
No, no, and…
Dr Leslie Vinjamuri
Unfair.
Sir Nick Clegg
It’s not unfair. If – it’s not unfair. It appeals to the chattering classes and the broadsheet classes. It will not appeal to the mass of voters that you win elections in most mature democracies. So, what the anti-nativist movements, who have been defeated and thwarted in so many places, need to relearn, is to be agents of change and to be very, very armed advocates of change. At the moment, they appear to just be in a, sort of, defensive crouch, which is a hopeless position to be in in life generally and certainly in politics.
Dr Leslie Vinjamuri
I mean, to be fair, right, to the previous US administration, there was a recognition that things weren’t working, that there were high levels of inequality, that the system and the rules needed to be adapted and changed. They just didn’t believe that they needed to be trashed, and so I think, you know – and I would say here at Chatham House, both in the audiences and behind the scenes, there’s been a lot of innovative thinking. It’s really hard to cut through right now, as you well know, on adaptation, innovation. But, you know, there’s a distance between conserving the old order, which I think everybody recognises things have moved on, and…
Sir Andrew Steer
But they keep…
Dr Leslie Vinjamuri
…discarding. But I want to come to the audience, but you first, Andrew, and then we’ll come straight to the audience.
Sir Andrew Steer
But would – just that point. I mean, what Mr Trump has taught us is how not to do it, but he’s also taught us that actually, you do need disruptive change.
Dr Joel Hellman
Hmmm hmm.
Sir Andrew Steer
Everyone who’s tried to do it so far has tried incremental change.
Dr Joel Hellman
Hmmm.
Sir Andrew Steer
And we know through the theory of path dependency, that actually, you can be on a path and you know it’s not the best path, you know there’s a different path over here, but you’ve crossed – we’ve got to cross the mountain. That’s why you need disruptive change and that’s why we’ve failed to reform the United Nations, that’s why we’ve had increasing income inequality. Not because people didn’t want to do something about it. They weren’t willing to make those – and that’s why – just to support what you said a minute ago, Leslie, when you said, I think there’s still hope for America, I do too.
Dr Leslie Vinjamuri
See, the American story is not over.
Sir Andrew Steer
It is, it’s very interesting. I mean, it – I guess we both live in Washington D.C. and views there are really split amongst the good guys. On the one hand, they say, “Look, what we’ve lost is not only lost 80 years of the, you know, rules-based international system, we’ve lost a quarter of millennia – of the millennia.” Next year is the 250th anniversary and basically, we’re throwing away the constitution. Not whether we’re going to rewrite it, but we are eroding all of the institutions that protect the constitution. So, there’s that side.
There’s another side that says, “Actually, we only need 2% of the population to change their votes,” and they’ve probably changed them already, given what we’re seeing. “And once we get back in power a sensible group, we then will understand that we’d failed to do it in the past. We really will make those disruptive changes.” Now, that’s the truly optimistic view, so I envy you about it.
Dr Leslie Vinjamuri
Then hopefully, disruptive changes with attention to humanity, as opposed to just pure disruption. Okay, gentleman right here. I will take a few and then, in the back, there, and the woman over here.
Peter Price MEP
Peter Price, former Member of the European Parliament. I’d like to introduce the topic of rare earths. To what extent do you think the shortage and the location of rare earths is going to influence the way things develop in the next few years?
Dr Leslie Vinjamuri
I’m going to take a few. There was one right back here, the woman right back here in the middle, on the aisle.
Member
Yes, ma’am.
Dr Leslie Vinjamuri
And then right here on the front, and third right here on the front.
Member
Yeah, that’s…
Dr Leslie Vinjamuri
Right there, right – the woman right there.
Member
Which one?
Dr Leslie Vinjamuri
And then third, right here in this aisle.
Member
Which one? Oh, it’s me?
Dr Leslie Vinjamuri
Yes.
Member
Oh, okay, fine.
Sir Andrew Steer
Yes, it’s…
Member
Yeah, so I work for an American energy company, and I’m just interested in, kind of, what are the factors that have led to deglobalisation? It seems like there’s a lot of economic disillusion. Social media’s a huge factor that’s really divided and elevated nativist platforms. And if we’re talking about moving away from a rules-based system, then how do we regulate things like social media and social media companies that actually, like, you know, have had an impact in democratic countries and, you know, navigating free speech and those con – types of conversations? So, is that going to, you know, help be part of the change or just, kind of, elevate populist platforms that continue…?
Dr Leslie Vinjamuri
Thank you, that’s a great question, and right – the gentleman right here in the front.
Member
My question is why? Dean Hellman mentioned the progress that was made during the so-called rules-based order when it ruled the world from the Second World War to the – I would say the beginning of the 21st century. And Professor, you also mentioned the progress that was being made in the ecological and the, you know, carbon emissions issues and things like that. And you, Mr Clegg, mentioned the disappointment, if you like, of people around the world that the rules-based order was not working for them. So, is there a prescription that you can give us as to why and where we could go forward from there?
Dr Leslie Vinjamuri
Thank you. So, I see everybody jumping off their chair to go first. Not normal. Nick?
Sir Nick Clegg
Well, just on the last point, I mean, it – there’s no one thing, but I certainly think in this country, and of course, it’s not the case in many, many countries around the world, but in this country, certainly in large parts of Europe and in a different way, but still very impactfully in the United States, I think we somewhat underestimate the social and political consequences of what happened in 2008. A huge amount has happened, of course, since then, but I think it rocked the fundamental promise of capitalism right down to its foundations.
It – because it – I think it broke, for many, many people, particularly on low and middle-incomes, it broke the idea that there’s a relationship between how hard you work and what reward you get. And they felt that a system which they didn’t understand, a banking and financial system, rank amok, blew up, their taxpayers money went to bail out these banks. They felt that no-one was held to account, and they ended up, and millions of people ended up, having to work longer hours for the same pay or work the same hours for less pay. And I certainly know in this country, it is impossible to understand almost anything that’s happened since.
I, for instance, don’t think remotely, the very narrow vote in Brexit would’ve gone the way it did if people were not still livid about what had happened in 2008 and the deep, deep damage it done to the fundamentals of this economy. Now, in our case, it was rather extreme ‘cause we had this oversized financial services sector, which was a proportion of the – sorry, in relation to the wider economy, was, sort of, outsized. I remember in my first week of becoming Deputy Prime Minister, being told by an expressionless Treasury official in that, sort of, Whitehall manner, they said, “Deputy Prime Minister, you do understand that the total liabilities of the British banking system are five times bigger than the size of the whole British economy.” And I suddenly realised we were sitting on an unexploded, sort of, you know, bomb that if we didn’t diffuse it carefully.
So, it’s a – maybe it’s quite a British thing, but I think since you ask ‘why’, I think it’s impossible to write the history of this period and the growing sense of disillusionment about the status quo without understanding quite how damaged people felt from 2008. And I certainly think the subsequent history would’ve been quite different if that financial crash had not happened. So, there are other factors, but I think they are – it’s a rea – it’s been a – it’s a – I – it’s a – it’s had an outsized role, in my view.
Member
Okay, but it’s how – where to go on this.
Sir Andrew Steer
Hmmm hmm, hmmm hmm, hmm.
Sir Nick Clegg
Well, again, many different components to it, but – and again, this sounds horrendously glib, but I really do think that this feeling that people have that their kids are going to do worse than them and that there’s no relationship between hard work and reward, I think it’s just so – it’s such a primitive thing. You just, sort of, think, this is unfair. Yeah, the whole point of a, sort of, developed capitalist economy is that it grows and the next generation does better than the previous generation and that generation do better. That’s collapsed and that’s collapsed for millions of people with good reason, with very good reason.
And it’s, kind of like, I – and I don’t know how – you know, there’s a whole bunch of things which I defer to Joel and Andrew and others, but I mean, in this country for instance, where I made – I think I did some good things in politics and I made some terrible errors. But the biggest mistake that I made, and my generation made, and subsequent generations made, is we just didn’t take the issue of housing nearly serious – we – if you look back over the last 20 years in this country, there should’ve been a political consensus across the parties to use every single instrument of the state to massively expand affordable housing. It is a criminal injustice to younger generations that affordable housing is now so far out of reach. And how can you expect young people to think that this system works for them when they’re priced out of the prop – they can’t get on – you know, they have to stay with mum and dad, they can’t get onto the rental property ladder, there isn’t enough affordable housing. We’ve locked up assets, basically, amongst older generations.
So, I just think, you know, I think we are at – I mean, to Andrew’s point, if only we’d be more radical on all of that. And I often think to myself – people say, “Oh, what’s the biggest mistake?” And they always expect me to say this, that and the other, all of the things that I was flayed alive for. The biggest mistake was I didn’t recognise that we should’ve been way more radical on housing way earlier and I think that’s been a generational betrayal of younger people. And if we’d got that sorted – so, let’s start now, at least.
Dr Joel Hellman
Uh-huh.
Dr Leslie Vinjamuri
Before you answer, I’m going to inject one more question from the online, which I’ve been remiss, they’re great questions, but it is – and you’re well equipped to answer, both of you. “How can the Global South,” it’s a terrible term, it is a diverse, significant set of countries and people, but “How can the Global South feed into this?” We’ve, sort of, recognised that there’s been a degree of dismissal, but how can they…
Dr Joel Hellman
Yeah.
Dr Leslie Vinjamuri
…insert their interests into all of these questions?
Dr Joel Hellman
Well, I’ll say briefly on the point of ‘why’ and also that I think links to the previous question on social media and change, is that it’s the destabilising pace of change. The change that has been happening across so many countries of the world is so rapid, is so comprehensive, it’s actually dislocating. It’s – it is – it’s changing – the globalisation story, sort of, changed the nature and composition of how people engage within their own countries. It generated this fear of the other and concern about the other. It had – we had tremendous economic dislocations despite the overall level of improvement. Social media changed the way in which we communicated and therefore, it touched everyone.
And I think these – this kind of change, any significant change on that order is very destabilising, very dislocating. And in periods of instability and dislocation people turn inward and look for nostalgic stories about, you know, a time which was more stable and less risky and seemingly unpredictable. So, I think it’s recognising the extraordinary pace of change and how – and recognising how dislocating that change can be.
Now, going back to the question of, you know, in this period, what can the Global South do? I – this is really an essential question, because I think there is just not a unified framework. We talk about the Global South. The Global South doesn’t talk about itself that way, and there really isn’t a unified framework to think about reordering the existing institutional structure. And this goes back to the points that have been made across this panel, that the existing institutional order is so resistant to change of anything that would reduce, especially the voice of countries whose power has diminished. You talked about what happens in Europe, we talk about what happens in the United States.
These powers have diminished and the key institutions, whether it’s the United Nations, whether the Bretton Woods institutions, the World Bank, IMF, regional development banks and so forth, have not changed barely an inch to recognise the voice of emerging powers in a more significant way. So, one way is to really push, in a much more disruptive way, to say that these institutions have to change and they have to adapt. But you’re always seeing other new forms of organisation. I think the most hilarious, to be honest, is BRICS, because here’s an organisation about the Global South that was created under the umbrella from a guy from Goldmann Sachs, who, sort of, said, “This is how I’m going to order the world.” A – you know, a Gold…
Dr Leslie Vinjamuri
He used to be the Chairman of Chatham House, just so you…
Dr Joel Hellman
Sure.
Dr Leslie Vinjamuri
…know.
Dr Joel Hellman
Okay, that…
Dr Leslie Vinjamuri
Jim O’Neill, and…
Dr Joel Hellman
The notion…
Dr Leslie Vinjamuri
…a very…
Dr Joel Hellman
…that the most…
Dr Leslie Vinjamuri
…well-loved Chairman.
Dr Joel Hellman
…herbal organisation for the Global South is an umbrella created by a Goldmann Sachs Banker at Chatham House, that is, you know…
Dr Leslie Vinjamuri
The sequencing is wrong, but they…
Dr Joel Hellman
But that suggests…
Dr Leslie Vinjamuri
And a tremendous former Chair.
Dr Joel Hellman
…how difficult it is to, kind of, think about a different framework. This is actually, interestingly, the 70th anniversary of the Bandung Conference…
Sir Andrew Steer
Hmmm hmm.
Dr Joel Hellman
…that – held in Bandung in Indonesia, that brought together Asia and Africa and created the Non-Aligned Movement. And the question is, where is that energy of emerging powers to think about a different way of pushing against that effort to move everything into a bipolar framework and say, “No, that bipolar framework does not represent the way the world works”? And that does require unity. I don’t think that BRICS is going to provide it, but there needs to be other forums in which the Global South looks to get that voice out onto the global stage.
Dr Leslie Vinjamuri
Thank you. Andrew?
Sir Andrew Steer
So, Amen, agree totally with all of that. Look, you know, just as Joel pointed out earlier, I mean, in my lifetime, global poverty, extreme poverty, has fallen from 55% to 9%. Never in the history of the world – and the average life expectancy has grown by 25 years since I was born. Unbelievable, and at the same time, huge inequality has grown within our countries and many other. So, if you like, the equality among countries has been improving, equality within countries, and so, in answer to your question, sir, and it’s your housing point, as well, the number one thing should be, in America they’re called the ‘coastal elites’, should try and see things through the eyes of regular people.
On the developing countries story, we have just got to double down on Joel’s point, that we cannot allow – and Nick’s point, we cannot allow, you know, just two powers to dominate the agenda, and there’s some good news there. If you went last year to the African Climate Summit, President Ruto – it was in Kenya, he gave this brilliant opening talk. He said, “Look, Africa is a victim, no question about it, but we are also the solution. We have more land than anybody else, we have more sun than anybody else, we have more minerals than anybody else and we have more brilliant young people emerging who are going to change the world. And we just need a little bit of partnership, and we will be the solution.” And it was like, wow, we’re in, you know. He also said, he said in the opening thing, he said, “Welcome back, everybody.” And people said, “Well, wait a minute, I’ve never been here before.” He said, “You all came from Africa.” It was so brilliant.
On rare earth, sir, I mean, it – China took the long road and has created this near monopoly, well done. I actually think it is going to be a stabilising thing, because I think it’s going to be much harder for Mr Trump to do what he wants to do given that China holds the ace, so to speak. But actually, Nick would be better qualified, ‘cause he needs – he needed in his old job a lot of these rare earths.
Dr Leslie Vinjamuri
Any final…
Sir Nick Clegg
Yeah.
Dr Leslie Vinjamuri
…sort of, thoughts? I really want to take more questions. I, personally, and I’m sure we all feel the same, would love to hear more. I do think we’ve come to our time, and you’ve very generously given your time. And now that you’re back, Nick, in London, we hope that you will be a regular speaker and participant at Chatham House. That’s important, that’s how we make it all come together. And Joel, thank you for co-hosting.
Dr Joel Hellman
Thank you.
Dr Leslie Vinjamuri
And to Georgetown, I’m a alumni faculty member, so I feel very passionately about the place. Andrew, great to have you here. Thank you all very, very much and thanks to all of you.
