Books . Ijust read all kinds of different things. I am a bit of a hoyt buff so defiant and dead weight are normal. Also, the authors of the books have a tendency to draw me in, and eric lar sewn wrote in guard o. Beasts and i think so he has been good. And then the one of three offends a day. A little bit of allyber tarean streak so i want to make sure when it comes to Ridge Justice reform we do those things right and get something historical be was doubtful. Good evening, everybody. Good evening on this beautiful evening. Im Richard Fontaine, the president for the center of new american security, and thank you all for joining us this evening. Were very excited to host this launch in d. C. Of anya manuels book, this brave new world, which is already getting excellent reviews, including in the wall wall street journal u havent seen it. That should be the second thing you read, after her book, the review in the wall the wall stt journal. Were really privileged to have steve hadley. Both anya and steve are cofounders and principals at the Rice Hadley Gates group, and i will give you just ill brief a sketch of both of their biographies because theyre so well known to all of us in this room. Anya is a lawyer, a former investment banker, she teaches at Stanford University and in government, among other things, handled the asia portfolio for nick burns when it was the undersecretary of state, and she is on the board of advisers which is not least of her accomplishments. [laughter] steve hadley, of course, served as National Security adviser, deputy National Security adviser and assistant secretary of defense for interNational Security affairs among his many positions and is the chairman of the u. S. Institute of peace board. This booking is this book is really a wonderful work, and its important and comes really at an important time when so many of our policymakers, Business People and others are trying to determine precisely how to think about india and china and the future of the global order and where these two very important countries fit into it. And so on behalf of cnas and all of us, were very honored to have the ability to host this conversation tonight. So without further ado, let me turn it over to anya and steve. [applause] thank you, richard, very much. I need to begin by saying im a big fan of anja and a big fan of her book which i think is extremely informative and really readable. And a terrific read. And congratulations. I want to start by asking you why you decided to write a book, why did you decide to write this book, and why india and china together . For most people either one of them would have been a daunting task, and you decided to do both. Thank you, steve. First of all, thank you to cnas for hosting this. Thank you to steve hadley for being willing to do this with me, and thanks to all the friends, old and new, that are in the audience. Im really happy to be here, back in d. C. , and seeing all of you. Why this book. Asia is a little bit in my blood. I actually grew up partially in pakistan in abbottabad which wasnt famous then for bin laden but led to the wild west of china near the disputed border of india. So this is an area ive been interested in for a long time. I did a lot of work at the state department, mostly on india, some on china. And enclosingly as i watched increasingly as i watched, now we do business in both of those places for our clients. And as i see the Public Discourse in america about asia, it seems were so worried about china x theres so much about china. And one day theyre ten feet tall, and theyre coming to get us x the next day theyre the doomed dragon, and their economy is collapsing. Neither, of course, is quite right. But theres very little Public Discourse about india. And i believe that even now but especially a decade or more from now these are the two countries that are going to have a dramatic impact on how we all live as americans. By then they will have three billion people between them, so our companies will be selling to them. They will have the Worlds Largest middle classes, and we cant even begin to solve the worlds biggest problems without them. I live in california, a smog loud already travels from asia all the way san francisco. To san francisco. In a decade or so india and china will be the first and Third Largest carbon emitters, so we need to get our relations with them just right. So you already knew a lot about india, a lot about china before you wrote the book. What is it that you learned in writing the book that most surprised you. A lot. [laughter] but the number one thing i would say is we spend our time, all of us here in washington, talking to Government Officials, talking to business leaders. When i wrote the book, i very much tried also to see the hinterlands of both of these uncountries. Of these countries. I spent some time in the slums of delhi where people live in core gated iron huts, and they make their living by recycling materials from a trash heap that is three football fields high. And i spent some time interviewing the folks who aem bl all assemble all of the worlds electronics, your iphones and android phones. Thats not something id been exposed to before. We all know theres a lot of poverty still in china and india. India much worse, so i would ya has 300 Million People still under the World Bank Poverty line which is 1. 25 a day, not very much. China has 84 million. So the scale of the problem is much bigger. But its also in china most of the poor, especially the urban poor, are working in factory jobs or in jobs that are on the books. So in a way, theyre actually easier to help. Because you can do it through paycheck, and you can give pensions, and you can give health benefits. They dont always have them, but its possible to do that. In india, all of these guys are working in the informal economy. So what are you going to do . Until you had india has just introduced a new biometric id system which, actually, puts some of these people on the books and gives them an existence. And mod hi has opened almost 250 million new Bank Accounts which will allow these people to be helped by the state in a way that they werent before. One of the things implicit in what you said, these are countries that have very different approaches to development and seeking prosperity, many some sense in some sense seeking power. And i know you avoid the horse race analogy which is better, which is going to win. But do we have a stake in terms of how these countries succeed and whether they succeed . Whats the u. S. Stake in all of this . Yeah. We do have a stake in it, and i think we want them both to succeed. Its often much more comfortable to deal with india than with china. I describe that in the opening of the book for the twostate visits. Im sure many of you were part of them, but there were two business dinners, one for xi jinping, and another one for moti in palo alto. And the moti one was relaxed, and the president xi dinner was wonderful as well, but it was very formal, and we were working hard to get our Relations Just right. It wasnt quite as comfortable as with india. So i agree with you, i dont think this should be about the horse race. I think its very much in our interests for both of them to succeed. Because as i said, you cant solve Climate Change without them. You cant change solve a lot of the worlds other big problems without them. And in spite of what weve heard in our president ial campaign, our economies dont succeed unless these two growing economies become the engines of, continue to be the engines of world growth. Lets talk about one of those problems, the Environmental Issues. China is now the worlds biggest emitter of co2, for example, and india is probably the worlds Fastest Growing emitter. So a common and, obviously, it affects what happens in those two countries, it affects the world economy, it affects the United States in terms of the environmental situation in which we find ourselves. Is there something that we can do with india and china together that all three countries could do that could make some progress on these Environmental Issues . This is, actually, its a good question, and this is one of the most fertile opportunities for working together. In the book i lay out a number of challenges that these countries face on their way to great power status and how they are dealing with them. The environmental one is an enormous challenge. So, you know, when youre looking around china, you see these huge coal mines 30 football fields in length. They make those mining trucks look teachny, tiny, and you see china still needs to do this stuff to help it grow. They cant help it. And in india 13 of the most 20 polluted cities on earth are in india. When i was on the holy ganges river, you see dead bodies floating in and others right near them. When i was in government, i had a small part and you had a large part in negotiating the civilian nuclear deal with india. Partly that was about our Strategic Partnership with india, but a lot of it was about getting clean, nonpolluting power as india scales up its electricity use. Its a big winwin for both countries. India has these superoptimistic projections about how many Nuclear Reactors they were going to build. If you divide those by three, the deal still saves more co2 emissions than the kyoto protocol implemented in all of europe. And i would say similarly, i am a i really think what the Obama Administration did with china on the Climate Change accord that was announced in december of 2014 and that then helped spur the rest of the world to announce their own binding commitments on emissions was another helpful way that all three can work together. More to come on that. You wrote an oped in the New York Times recently on indias corruption. We dont hear a hot about indias corruption a lot about indias corruption, though if you talk to business communities, one of the big complaints they have is indias so corrupt, you cant deal with it. China gets a lot more pub publiy for a corruption crackdown. Can you talk a little bit about the different approaches in india and china and what they say about their two political systems . Yes. The way both cups are dealing with our anticorruption efforts is a perfect example of the differences of the two systems. So the reason the New York Times, i think, wanted to write about the india story is because theres a personal story there. When i was a young state department official, an indian midlevel Government Official tried to involve me in a kickback scheme. [laughter] i sort of sat there naively nodding and blinking and got out of his office as quickly as i could. You know, its rampant. [laughter] and its a difficult problem just like it is in china. The indian way of the chinese story is well known, and the way china has dealt with it so far has been almost completely topdown from the anticorruption czar, almost 200,000 people investigated, a lot of them have gone to trial. Purely topdown. Indias solution has been almost entirely bottomup. So about four or five years ago a lot of citizens were finally fed up with this. A man who looks a little bit like gandhi, hes sort of older and bespectacled, started a hunger strike, and it caught on. And before you knew it, there were tens of thousands of people across india who demonstrated and said enough is enough. Some new anticorruption laws have been passed in india. Its been far from perfect. But the citizen activism is there, and it continues. The problem is neither of these approaches alone are perfect. And when you look at the countries that have really tackled corruption and done a good job with it singapore, hong kong, south korea what theyve done is a little bit of what youre seeing in china and india but more. So hong kong, for example, established an independent commission thats nonpolitical and very quickly adjudicates all of the cases. There was a massive Education Program to teach young people that this is not how you should be doing business. And in that case, but not all the cases, there was a rise this Civil Servant salaries. Is so those are some additional steps that i think both india and china should take if theyre going to really solve this problem. Its doable, but it requires a lot of, a lot of sustained effort and apolitical effort. Yep. Lets talk a bit about china. There has been a remarkable crackdown in terms of china. I think thats what we would have to say in terms of human rights workers, in terms of media, in terms of social media. And i think there was an article in the review, actually, in the wall street journal. They used the figure, what you see around, that there are about 180,000 incidents of civil disruption in china every year. Talk a little bit about the challenge that poses for china, and they really keep the lid on that society, a society that now has, you know, 600 Million People on internet, a lot of social media and very engaged population. And how are we to think about the longterm stability of china in light of this, whats percolating there . Thank you. Im going to ask the second part of that question right back at you in a minute [laughter] because steve has a lot of expertise on this. As i started digging into it in the book and speaking to interviewing a lot of people, i saw actually three different kinds of dissent. One is the 180,000 protests that you talked about, mostly run of the mill people who dont want their property expropose rated, who are worried about Labor Conditions at their factory, who want a better environment. Sort of daily issues. Not political. This is not for freedom, this is for i want to get paid for. I want clean water. Want. Two, you have some people who are just always going to be outsiders in the chinese system, the uighurs, some christians, other communities that are on the outside and that are in some instances protesting and a lot of other places are underground. And third, and i think this is the most important force thats coming up. When i go to china now and i speak to students, stanford where i teach has a big center in beijing. When i speak to students this, these millennials have no memory of Tiananmen Square. Interesting. They have no memory of crackdowns. And they are unbelievably active on social media. Just as you said. And some of the things they say are really, they cross over into, you know, theres a guy at berkeley who studies whats trending on chinese social media. And you would be surprised at some of the things that are out there. Soen when the so when the Peoples Congress is meeting in beijing, you have a whole uptick in who are these people, they dont represent me. When i had a young actually, when condi and i were there a few years ago, we had a government translator, and we asked her about this. She said, well, you know, we all know that social medias monitored, but we keep switching to the new ones until they catch that one, and then we do it. So we thought that was surprising. On the second part of your question, is it going to implode, that ill ask right back at you. [laughter] i think no one predicted the fall of the soviet union, so i wont hazard a guess here. There has been recently a lot of chatter about china, and its hard to see how you interpret it. As im sure many of you know, in march there was anonymous letter sent that asked shi gyp ping to ten down because hes developing a cult of personality and actually threatened his person. There are constant rumors no one knows whether theyre true or not of attempts on his high and on the life of the anticorruption czar. Its anyones guess whether it there is more brewing there or not. I do think if there is a change of government in china, it would be more likely that it is an internal within the communist party uprising than a Tiananmen Square type public uprising, but i would love to have you answer that question as well. That wasnt in the script here. [laughter] i talked to a i was at a u. S. China Dialogue a week ago, and a good china watcher from one of the think tanks in washington said hes heard all these rumors about instability and, you know, security threats and all the rest, and he doesnt really believe it. He thinks you would not have seen xi jinping traveling internationally the way he does. So his thinking is its a big rumor. But i think one of the challenges, and i had a conversation with a Senior Adviser to president xi on economic policy, and he was giving me a hard time about the american political system and sort of making the suggestion isnt the chinese better. And i think the risks for the chinese and what i said to him was in the United States what youre seeing is a lot of discontent being played out within our political system, for better or for worse, because thats what our political system allows rather than playing out on the streets in terms of violence in demonstrations which is what we saw in the 60s, and we didnt like that much x. , of course, the question for china is if you clamp down too much, what is the outlet . Its the old problem of, you know, you put the lid too tightly on a boiling pot, and at some point, theres a problem. Who knows. Let me add one thought on this too. You know, we speculate about this stuff a lot in the media and policy circles like this. I think its not in anyones interests for there to be a drastic, rapid change in government in china. Think political turmoil in china oils the financial markets, crashes the world economy. So i dont think we should be hoping for any type of overthrow. And let me ask you something we hadnt talked about, but i think it would fill out the circle. Ho