Richard haass i am Richard Haass author of the new book failure to adjust how americans got left behind in the Global Economy timing counts for all lot in life 80 percent is tightening timing so this is good for the operand good for the country. Congratulations. It is an important part of what we do hear one of the reasons that we so emphasize the book and requires death with analysis said commitment to a subject but also provides raw material. So it is the principal person that this institution almost a decade. So n some ways with foreign policies put the council of Foreign Relations over the years the bill with infrastructure in n negative n now here we are the of their category may be globalization andy individuals collectively to deal with those relentless pressures so we will talk about a for a few minutes is of the record by the way so look at the title which is the failure to adjust but then how americans got left behind in the Global Economy t11 means exactly what . Would adjustment has not been made adequately . Economists talk about the adjustment cost. But talk about the Global Economy if you go back aid did not trade that much. So this has been a modern experience and the adjustment cost associated with that and what that means any economic language they need to acquire new skills some places do things better than others it is one of the industrys so what will happen to those people . Me as a country have done rather a port job of that. This is category four hurricane on the horizon. We did not bat an down the hatches. So the conversation was just blown out the window. If it was category four hurricane if they say it will hit us in x amount of time . This is a failure of leadership and we have a habit that says the the end of the day we are the most competitive economy in the of world. With the most enthusiastic Interest Groups ecl our American Workers are better than any others with low trade barriers other countries have high trade barriers that will open up new markets there was a failure of imagination that were most disrupted that was the general society wide problem and there is some association with that institution. It was actually slightly unfortunate but in 1971 to change the World Economy president nixon said we are moving into a different world. There are other countries that are coming we have to play this differently than we have been accustomed to differ dont there will be severe consequences. But we have not done so badly. But even with individuals is hard to make that argument. And i wouldnt if there was truth in advertising would not have then some americans or how many but if you look at the most Competitive Companies in the world like kugel or facebook or microsoft it is so light and share lions share but there are significant parts of the country that we learned in november that really have been hit hard. That should not have banned a surprise. I am very much in favor but we did not Pay Attention to the cost. Trade has brought benefits that is based upon just that but the cost is narrowly located lofted those smaller numbers prevail over larger numbers is that the case here quick. Idol think that is unreasonable but i would not say because generally a lot of benefits from trade pet in the Manufacturing Industry in particular was hit very hard. That is a big number. Think of what those jobs or. Union jobs modest levels of education to make a good solid middleclass salary. There was is unemployment or Social Security disability so the impact of those individuals isnt just the factory jobs but the local services that our dependent on the paychecks. Those effects are significant and i do want to minimize those. So to what extent are these job losses much more of these increases that eliminated the jobs because of the cheaper imports across of border . First if you have to add is that technology is bigger maybe 75 percent or 65 percent but it is the majority. We dont buy as much stuff we consume more services. But second it is a false dichotomy. If you are the u. S. Textile company you have to options. You cannot beat the competition so you got of business had been more conscious . Some employees lose their jobs but is that lost to technology or trade . But it doesnt really matter and it shouldnt we should have a trade Adjustment Assistance Program for those who are dislocated for those reasons. You are right we will come back to the trade adjustment assistance. As we carry of Foreign Policy to find most the trade is that Public Policy is inconsistent with your conclusion. Because trade is more than the economic issue was over decades more people have them brought out of poverty worldwide and the last two decades and any other time in history. Has a lot of benefits associated but with a hurricane coming to say we dont get on top of the problem even if trade is only a part of the story it is hard to say you can control technology this is the way the evidence that even if not the primary culprit. So to what extent the isnt that they are better read introducing or others have lowwage skills or for a year in fair trade practices but what makes us uncompetitive its. Rating did is both in its half about the rules china in the tickler was enormous shock because of science but with the dignity you they are heavily subsidized and for all the benefits it brought china was very distorted we let that currency stuff go on far too long. Now at a time when they tried to prop up their currency but it was in issue there were rules against that sort of thing. But that said the biggest part of the challenges the home with research and development. Its health care cost. Making sure we are set up to be the most competitive and to be the highest rate. Back when we did some work on it i remember reading 17 separate adjustments . Whenever that is is it is a lot. Are we not getting a return on investment quicks but if you look at the active labor market it helps people train for a new career. The average europe is five times that much. But we dont spend very much and technically we dont spend it very well. With those that are creating jobs with a bizarre situation where despite the loss of 6 Million Manufacturing jobs there are a lot of jobs that cannot be filled because we dont have employees who have the right set of skills. So that is the major fail which is a much closer work between the government because it dont do that that well so it is the feeling of a specific problem. Dimension never structure , if you were designing and spending more wisely what would be your recipes to make this less acute situation . Immigration compete more aggressively for investment. Twoseat carrier and trump to say we care about jobs we will fight for that but all countries are doing this. Is a worldwide game. O negative like us to negotiate rules to constrain the conduct competition solid governments arent bankrupt we only started doing this 10 years ago at the National Level very inadequately. But it is depressing we still talk about it. This competitiveness with the rail system to get the product to market adduce think the Corporate Tax system is a real problem as an overhaul desperately overdue. Told like to see closer coordination whirred trade policy is made in washington the, from the corporate lobbyist. But if you look at the entities is state and local development would if you try to build the Solar Industry if they are dumping solar panels there is no chance for the american industry i talk about the mechanism with the state and local authorities those of some of the things that i talk about is that best left to the federal government . I would not have the states right to the rules. Not Even Congress so you have to have a single gold rules place but i think that is a good thing. Allot of what you talk about give what we seek in other countries and in europe but everything that you see elsewhere if you see a pattern . I think other places are doing Better Writing the germans are doing better. This. We hear about the apprentice program. But i do think there is a commonality. But with europe more reaction of immigration if you look at the european complaints we dont but you beat them chickens that are fed with chlorine. [laughter] i apologize to the American Poultry Association but with the wage to see similar things of emigration but that commonality is i think what people are saying we won it governments to slow this down a little bit. Slowdown the pace of change. We live with rapid technological change change, highlevel of immigration there are very positive and a lot of ways but people feel dislocated as a result we want a level of government control. They could control the pace of change. Negative what point does that become protectionism between being opened and closed . How do you take that kulaks position . If that is a challenge that you set up for yourself. To say politics is how we balance the different demands of society. If you go back to the vote the house vote was four against they are in favor of liberalizing trade but the vote in the house to hundred 34 vs 200 the majority of the democrats voted against them than they are not too sure. If you get to the Free Trade Agreement they are open for an hour then they go or around intimidating those republican members one said it was the worst experience of his life that single vote that they needed to fast track through the house so they Pay Attention would say we do not have that full speed pedal to the metal. Somebody said the problem is not trade but trade agreements to be put through the political process. But what about structuring trade so we have to subject them to the process . I dont know as an end run i do think some of that is misleading container shipping, internet, but to say that the voting with container shipping you do get to vote on the trade agreements and that is just a reality. As you can see somebody is says well versed as you can get. Is there anything you think it could be done as a frustration to help more people . Is this the debate that is lost that certain things were done overtime that the allies could have it quite. I do actually a dont think the debate is lost. We never had a real debate over trade to be honest. Its in the middle of the 80s linking the economy 10 times its size it was debated the conservative party won with the overwhelming mandate. And then to be free trade country with the fundamental debate. The closest became was 1982 with nafta for the republican nomination with ross perot but then never had a debate so we will have a debate but what you will see happen is we have heard a lot from those hurt because that paula c. Is open this if we actually have the president we will hear from those in the United States is a very different debate to play out. That is one of the ironies of history. [laughter] wait for a microphone. Over the years with the trade moving south more or less people found jobs but to see a core of people who were aging not emplace with their kids so what will you do about these groups of people who are locked outside . It is a real challenge. One of the things we want to do is break down the barriers of ability. So to talk about things that is not on the record so i will not mention but we had a conversation about the issue of creating jobs. But that is incredibly expensive. To drive up housing prices do need to Start Talking about that . People lost their houses because they are under water. But they move to follow the job. But i was stunned by the licensing requirements. So to move to go through the expansive time consuming procedure. People know that it is very expensive and. There are going to be people who want to stay emplace. And ford Generous Program of people moving looking and not the Research Done to the trio that is revolutionizing to hit hard a surprising number the end up of Social Security disability that is used expensive for us as the country but in the labor market take its 10 per hour job the keeps people in the labor force and i think we need to be thinking about Solutions Like that. Could you make the argument what tromp is proposing is an effort to to end up setting of groundwork to welcome those attitudes toward free trade that his peoples point of view is not the competitive we add immigration to drive down wages for those who have the multitude and attacks structure that does not make the economy very attractive with the horrendous regulatory increase over the last decade that makes it very difficult. So maybe it is possible to look more positively to make america more competitive and then say now we can participate in more trade agreements because we got rid of dysfunctional policies. If you look at the Research Areas say wage flooring impact but i dont disagree that essentially we made the same arguments back that trump has moved to thinking of National Competitiveness would be a giving. That includes thinking about inputs of the skilled work force. And i am not even sari. That did not bother me all that much. But American Companies had a strong sense of the obligation of a broader social obligation to the shareholders. Even in the narrow interest. And to take advantage of the opportunity. But if you run into difficulty whos got your back . The u. S. Government the representative of the American People so for your own interest than to expand your space to make sure the people are behind you let the japanese figure that out. What did they do they would open car factories and it completely changed the whole process they need to think about what is our state . But we will see with that goes. You made a point about local changes local to the city boston is exporting their manufacturing jobs overseas then responded with a thoughtful program to use intellectual capital and that has created a thriving economy in the amazing way today. Why did it happen there but no other place like capitol hill or the bay area . So why was that restricted . That is probably another book. Assassinating story. And to take this data set they discover their pretty striking thing those that have a college or university that this was the intellectual center and those that we mention those places like the bay area or boston with really good and strong universities this was an inheritance not easy to create but it does tell you about that intellectual capital and the most important asset and that will pay dividends. I read your book and it was a terrific book by the way i picked it up. [laughter] the check is in the mail. So really two parts with the trade deal, the whole idea of all of these trade agreements this asymmetry the people want to make them more than a corporate lobbyist for their interest and not just the United States they are figuring out his as they should with their corporate interest its and who was sitting on the side with the consumer and walmart is getting so many things cheaper. Into pay as the big price that is not as palaces we think so trade deal and how they are done what happened the second part is the tariffs meaning coming from what is happening with everything we send to china that is at two 1 2 . Server is asymmetry in all of these deals how do you reconcile that . For the record we have the 25 error that is left over so there is the plays the United States has high tariffs. But from that corporate perspective if they are interested in doing business globally i am not sure that is necessarily a bad thing. But that is the way things operate. But what do we do as the country to make sure we have reasonable share of the . Not that they double been perfect i think tpp is one of the better ones we have ever negotiated word United States really is a world leader i dont want to be apologist but i think too much focus is put on this because we are a nation of lawyers we have rules for everything. Just write the right rules everything will work out i am more critical of the failure to think about what we need to do was the nation to make sure weve prospered within the rules we have created. That is a great discussion one group of dislocated workers that are being trained are the military to focus on working on the private sector to bring that training into the military environment. So what this summit vice with the bipartisan support . I am not sure if that is granular enough to down at a certain level the field like to have to talk to somebody who understands but my general recommendation is to work very closely with the private sector. Talk to those who are creating jobs and find out what they need and structure the program. The state set up Training Programs the company basically said anybody it comes through the program we will hire. There is any way you can get that close relationship with companies that are hiring fewer a Community College or Training Program you are ahead of the game verses the labor market forecasts because often those are way off. How do you feel about guaranteed income . I am still wrestling with this. As part of the trade forecast arguing for universal basic and come, i think is the wrong way to go. If you have told range of other programs it could be in a budgetary fashion but any essential part of the way we events the society. I would rather spend did on wage insurance they are acquiring skills but they just cannot make enough money to make ends meet. That is one of the best programs created where you are working but their rebates from the government. I would rather see programs like that. But i am still wrestling with it and i am open to that. So your preferences for the program