David Rubenstein, co-founder and co-chairman of the Carlyle Group
On U.S. debt: “When I left the White House under President Carter, we had about $800 billion in debt. We have about 35 trillion now, and no one seems to be that worried about it; partly because people are willing to buy our Treasury bonds; At some point people will no longer be willing to do this.”
Henry Wang, founder and president of the Center for China and Globalization
On China's Belt and Road Infrastructure Initiative: He said the initiative has drawn many corresponding responses, including the US's Build Back Better program, the European Union's proposal for the new Global Gateway and India's proposal for an Indian Economic Corridor for the Middle East to Europe. “That's why I think China is still doing its best to work with the global south and work with developed countries, including multinational companies if necessary, to work together to solve this global deficit.”
John Williams, President and CEO of the Federal Reserve Bank of New York
On the Fed rate: “The higher rates … have not caused the economy to slow down all that much,” he said, pointing to a tighter labor market and fewer imbalances in the economy. Still, inflation has been a bit of a “bumpy road,” he added, but the data suggests it is trending downward.
On inflation forecasting: “Transparency has helped us,” Williams said, agreeing with former Fed Chairman Ben Bernake’s assessment that the Bank of England needs to be more transparent in forecasting inflation. “The Fed has moved from a somewhat opaque stance to an increasingly transparent and clear stance, not only in setting our 2% inflation target, but also in explaining how we think about the economy through our forecasts and dot charts and provide all of that to help as best we can so that the public can see how we think and what drives our decisions.”
On the Fed's inflation target: “I think a 2% inflation target is the right thing to do,” he said, adding that “low inflation is the bedrock of prosperity.”
On the Fed's handling of a second potential Donald Trump presidency: “The world is happening around us,” he said, adding that no matter who is in the Oval Office, the Fed's only focus is on “maximizing employment and… to achieve price stability goals”.
Gyude Moore, Senior Policy Fellow at the Center for Global Development On development aid from China: “Regardless of the type of government in the country, the Chinese are willing to get involved.” For many countries, at least in the part of the world where I come from, the fact that with the rise of China “Having a third node of global power is changing the balance and the way we deal with the West.”
On the West's concerns about China's “overcapacity”: For Africa and other parts of the world, he said: “Our position is ambivalent when it comes to the Chinese overcapacity argument.” “For example… if we switch to clean energy, Will we then use solar panels made here or in Canada, which are more expensive, or those made in China? So what is perceived as excess capacity for China in developed economies makes what China produces cost-competitive in markets that are very, very poor.”
Sim Tshabalala, CEO, Standard Bank
On the way African economies are grappling with global geopolitical tensions: He said a “war between the United States and China is unlikely,” adding that recent visits to China by top U.S. officials were reassuring signs. Nevertheless, he advocated that African governments and African companies maintain their independence and neutrality.
Xavier Becerra, US Secretary of Health and Human Services
On the origin of COVID-19: “We’re all still trying to figure it out. It would really help if China was more transparent. We are all trying to achieve the same goal. We will never know unless China opens up even further.”
On whether we are prepared for another pandemic: “In many ways, we know the pieces of the puzzle. If it is a new infection, man-made or biological, of course we have to be prepared to find out.”
John Waldron, President and COO Goldman Sachs
On China: “Capital controls can be problematic,” he said, adding that this is one reason many investors are no longer looking to China and that Japan and India have become more attractive destinations for investors.
On the potential impact of a Trump presidency: “I think it's too early to make a judgment on the election at this point. The markets only evaluate the US elections when they are close to the polls. We’re starting to think about policy differences…how Trump would deal with China.”
On consumer banking: “I think one of the real lessons from the financial crisis is that if you rely solely on wholesale financing and you have a market disruption like this, you really do put yourself at risk of losing your financing,” they added , that retail banking is not part of Goldman's Sachs' “DNA” and that its funds could do more to help companies.
Julie Su, Acting US Secretary of Labor
On the popularity of unions: “The unions have proven over the last three years that with a union on your side, you can achieve truly historic successes in the workplace,” Su said, adding that the pandemic has mobilized workers to agree to their demands express. “We have seen historic wins at the bargaining table, double-digit wage increases in hospitality, healthcare, Hollywood, auto workers and delivery drivers.”
On independent contractors: “Of course independent contractors play a role in our economy,” Su said, adding that the White House is more focused on cracking down on employee misclassification than trying to eliminate contract work.
On some Republican states banning heat protection measures for workers: “I think it's a mistake to take away standards that local governments, in their wisdom and knowledge of their communities, have put in place to protect working people.”
Democratic Senator Ron Wyden, Chairman of the Senate Finance Committee
On the impact of a possible Trump presidency on the Inflation Reduction Act:
“Every month [the IRA] is becoming increasingly resilient,” Wyden said, adding that a growing number of Republicans are becoming aware of how the bill has helped fund local businesses that benefit their constituents.
On the TikTok divestment bill: Wyden — who said he is not a TikTok user — said there are “significant national security issues” with the app due to Chinese ownership and privacy issues, as well as First Amendment issues. He said he supported the divestment proposals but would not support former U.S. Treasury Secretary Steve Mnuchin's takeover of ownership because of his ties to “hostile Arab states.”
Hank Paulson, former US Treasury Secretary
On the U.S. deficit: “Our national fiscal stance is unsustainable,” Paulson said. “The national debt that we have, if left unchecked, will ultimately destroy our economic well-being and our national security, which is rooted in the economy.” And the bad news is that people have been talking about the deficit risks for so long have spoken. I think both parties believe it cried wolf. But the longer we wait, the more expensive it becomes, the more dangerous it would be to get out of this quagmire.”
On artificial intelligence: Paulson said the rapid advancement of AI could have “great benefits for humanity” but would also be “disruptive” and lead to job losses in some industries. “I think we are also naive if we do not recognize that in many ways technology is growing faster than policymakers are able to understand and manage it.”
On competing with China: “I am 100% in favor of … emphasizing our national security, having a superior defense capability and seizing the most sensitive and advanced technologies,” Paulson said. But he said the issue of U.S. cooperation with China was “existential” and that it would be difficult for the U.S. to combat climate change, nuclear proliferation and cyber threats “without working with China … in a complementary way.”
Kevin Warsh, former member of the Federal Reserve Board of Governors
On the Fed's performance last year and what he would do differently: Warsh blamed the massive rise in inflation on the central bank's “biggest policy mistake in the last 45 years” and “the mistakes made over the last six months.” He said that the Fed needs “deep introspection” and that its theory that the US inflation problem is because “workers earn too much and live too well” is wrong and that “America's inflation problem is because that the government lives too well and also spends too well, printing too much, monetizing too much.”
“Inflation is a decision … largely made by the financial and monetary authorities,” Warsh said, adding: “The Fed is responsible for the rate of inflation, and the Fed must take responsibility for it.”
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