Top Risks and Ethical Decisions 2015

Jan 15, 2015

TV Show


"The world in 2015 looks a lot more dangerous, a lot more vulnerable," says global political risk specialist Ian Bremmer in his annual forecast. He notes that while the United States and China, the world's largest and second-largest economies, are doing better economically, the global environment is geopolitically much worse.


DEVIN STEWART: Welcome to Top Risks and Ethical Decisions for 2015. I'm Devin Stewart from Carnegie Council.

This is now the seventh time we have done this in a row. It has become a kind of annual tradition. Ian Bremmer, a great friend of the Council, calls his top risks "back to school for grown-ups," and every year we learn so much from him.

So how do you think he did last year? A lot of people ask me, "Did he see ISIS [Islamic State of Iraq and Syria]? Did he see troubles with U.S.-Russian relations?" In fact, both of those items appeared in last year's risks. He talked about the rise of al-Qaeda 2.0, as well as a "capricious Kremlin" and a hardball-playing Putin, hardball on Ukraine. The "capricious Kremlin," I like that; got to remember that.

In the year ahead he is really warning us to look out for political conflict worldwide that has reached levels not seen since the Cold War. That's what we are going to talk about today. We are going to look at the ethical implications of those risks and how we make decisions coming up to this year ahead.

With that background, I will just give you a quick bio on Ian Bremmer. You all know him. He collects new, exciting titles every year, so we have to keep up with them. The newest, most exciting title is he is editor-at-large and columnist for Time magazine. Editor-at-large has got to be one of the coolest titles I've ever heard. He is also president of Eurasia Group. He was a trustee here at Carnegie Council. He teaches all over the place. And he is on TV nonstop.

It is a great pleasure to welcome our friend, Dr. Ian Bremmer.


IAN BREMMER: Thank you, my friend. Thank you very much. It is nice to be back here with my friends in this cozy but very packed room at Carnegie. It has been seven years. It has been a fun run with these top risks.

I don't know if you are aware of it, but one of the things we do that I think is very important is, when we put them out at the beginning of the year, the first Monday of January, we leave them on the home page, and we leave them front and center on the home page all year long. We don't edit them.

I think it's really important, if you actually have the chutzpah to pretend that you know anything about where the world is going to go—I don't care how much work you do or don't put into it—you own up to it. You don't get everything right, but hopefully by doing it that way you have a little more credibility and you make some people think about the world a little more differently than they might have otherwise.

I wish I had better news this year, I really do. It's a challenging year. One of my best friends is Nouriel Roubini. We work together a lot. We write together a lot. They call him "Doctor Doom." He is older; I'm younger. He's an economist; I'm a political scientist. He has this big loft; I have this little, cute house where you take your shoes off. He is a glass-half-empty kind of guy; I'm just happy there's water—my view is this is fantastic. So I don't like to look at the downside. But this is not going to be the easiest message this year.

Let me start with a couple of good things. When you look at 2015, first of all, you don't see a lot about the United States, at least not domestically, because the United States domestically looks better, absolutely. I mean we look at unemployment and we look at growth and we look at political stability; and we even look at Congress, and we say, "It has done absolutely nothing over the last few years and it is going to start to pass a few things"—a highway infrastructure bill; we'll get the Trans-Pacific Partnership, I believe. That's actually a big deal, more for the Asians than the United States, but it's a big deal.

In an environment where people would just be happy if we keep the government open most of the time—the bar is low for success in Washington—we are going to exceed that bar, and the growth will exceed. So that's number one, is that the United States, the world's largest economy, actually looks okay in this environment—for some, even better than okay.

Furthermore, China—lord knows, we've all read the Tom Friedman columns for many years that have said, "Oh my god, tens of thousands of demonstrations, hundreds of thousands of demonstrations; China is going to implode at any moment and then China is going to have a hard landing." I look at 2015 and I don't see China having a hard landing. I see Chinese political stability being very strong.

I see Xi Jinping as the world's largest individual beneficiary of oil prices going down 50 percent. That's a big deal. It helps the American consumers, it helps the European consumers, but boy, does it help Xi Jinping. You go right now across the United States and you see over 25 states where you can buy gas at the pump for less than $2 a gallon. You go, "Wow, that's pretty good."

In China, gas prices haven't come down that much. Diesel prices haven't come down that much. They are taking a lot of the money and they are using it to smooth the pain of moving towards market prices for capital for state-owned enterprises. They are using it to actually bring up the cost for coal producers so that they can try to start making a positive difference in air quality in some of the wealthier cities in China.

Now, they've got a long way to go. But if you ask me, Xi Jinping has bought himself 12, 18, 24 months of being able to continue to push with structural economic transformation in his country. That is a big deal. For the world's biggest unknown question—which is, will China succeed in transforming itself over the next 10 years, as they become the world's largest economy?—we don't know the answer to that, but we can feel in 2015 more positive about the fact that their leader is going to get more momentum.

There are challenges that come with a strong Chinese leader with momentum. It's not like we're best of allies. But nonetheless the alternative is worse. The Japanese know this. The Americans should know this.

That all sounds pretty good, right? But here's the thing: The United States and China, the world's largest and second-largest economies, are doing better in an environment that is geopolitically much worse, and our interest in trying to help provide solutions to global geopolitical challenges that do not affect us directly very much is going down. It's not going up much in China, and it is actively going down in the United States. And we see this. We see this in the Middle East. We see this in Ukraine. We see this in Hong Kong. We see this in a lot of places.

I always try to start with an introduction of where I see the world this year, what the themes are. My last sentence was that, for the first time since I started the company back in 1998, I feel a sense of geopolitical foreboding, that my geopolitical "Spidey sense" is tingling, the little hairs on the back of your neck, that some bad things are going to happen this year. I wrote that before Paris—and we'll talk about Paris; maybe we'll even start there.

But all of these geopolitical tensions—the United States—we are not becoming isolationists. People say we don't care about the rest of the world. Oh, we care, we care. But we absolutely are more risk-averse. We're not talking about "boots on the ground." That is a quaint 20th-century notion, boots on the ground.

This year feels to me much more like a 21st-century year in a bigger way. We are using tools of power today that are much more 21st century. We don't want our soldiers exposed. We want to use surveillance, we want to use drones, we want to use the dollar. I talk about the "weaponization of finance," which is using market entry to the United States and the dollar as a carrot and a stick—not just sanctions against Russia and against Iran and against North Korea, but also penalizing banks and other institutions in allies of the United States when they don't go along with those sanctions, as we see in Europe.

What's interesting about that—this is not the United States withdrawing from the rest of the world; this is the United States engaging with the rest of the world in a much more unilateral way.

That absolutely threatens the trans-Atlantic relationship. The trans-Atlantic relationship was the bedrock that we built the American century on. It was what created the postwar order.

I look at relations between the United States and Europe today. They are not as close. They are not as warm. A Germany-led Europe would not be as close to the United States. When the Germans think about China, they don't think about Taiwan, they don't think about the Dalai Lama, they don't think about the East China Sea; they think about commercial bilateral relations. It is very different.

Never mind the Snowden problems—that's so 2014. Let's get beyond that. The U.S.-European relationship is not what it was. And that's before the Obama administration saw fit to send nobody this weekend, which I personally am appalled by. I'm not saying this as someone who supports the other side of the game here. I try to be equal-opportunity disgusted with politicians and that's a safe place to be, right? Disliking Washington is generally safe in New York.

When I saw that, the French government—this has been a tough year for alliances of the United States. It's not like our allies are getting closer to us. There's a lot of hedging behavior. But if you had to focus on a country that actually was helping the United States, the French were there. I mean the French were there in Libya before the Americans were there. We wanted the Brits on Syria, and they couldn't get there. The French were there on Syria. The French have been there on Mali. The French were there on Iraq.

Where was the United States? I was really profoundly troubled by the fact that the United States saw fit not to send anyone, and then Kerry this morning saying that it was quibbling to criticize the United States for not actually sending anyone. Fareed Zakaria, who I like very much personally, actually said yesterday that that was why god invented vice presidents, was to go—I mean I don't know what Biden was up to on Sunday.

But the horrible thing is I do not believe that this was a wanton decision to slap the French. I don't believe this was a "no, this is not important enough." I actually think this is a very small group of people who are close to Obama who actually are making foreign policy decisions in the White House who are completely overwhelmed, completely overwhelmed.

I think the amount of time that was spent on this decision was radically inadequate. And it matters. I mean the French will absolutely say, "Oh no, we are good, we're close." I promise you in France it is a serious problem.

I don't know if anyone noticed, but it was the French president who said at the beginning of last week, "We just can't support sanctions against Russia going forward. This is not helping us."

You're losing a lot of the Europeans. This is, in my view, very important, that, again, the most important bilateral relationship in the world, that has informed the order that we have all grown up with over the past decades, is actually one that is becoming much more tenuous. The Europeans are less happy with us. We are not spending as much time focusing on the Europeans.

Now to be fair, the pivot to Asia would imply that is exactly what should be happening. But let me be clear. People ask me about the pivot all the time. Let me explain what a pivot is.

You have two legs and you have two feet and they are planted here. Now, when you pivot, one leg stays in the same place, the other leg moves, goes from here to here. That's a pivot. I've seen it. We watch basketball—not well in New York, but we do watch it. We have seen a pivot.

There has been no such thing in the United States. We have shifted our weight a little, we sometimes move our body, but we are not pivoting. That would imply that the United States recognizes that the alliance with Great Britain, with Germany, is less important. Japan is more important, China is becoming more of an adversary, Russia is annoying but small, and so we are going to focus more on Asia. That would be a pivot—that we don't need the energy that we used to from the Middle East, that we need to focus much more on Asia.

Israel/Palestine—nice if you can get it fixed, but not a priority. That implies that Kerry would not have spent two years of being secretary of state trying to resolve, as his top priority, Israel/Palestine. Let me say something provocative: The top foreign policy official in the world spending his first two years on that is fireable in my view. That's provocative.

I do understand it. I understand it, but it's not good for America. And it's not like I don't want it fixed. I'd love it fixed. We're not fixing it. But that would be a pivot. We're not pivoting.

Let me also say on France something that depresses me, which is that there are other reasons why the United States has a better relationship with France—or had—and doesn't have as good of a relationship with others. It's an interesting thing that people don't talk about.

All of America's top allies in the world, except for France, actually have conservative governments in charge—Australia, Abbott; Canada, Harper; Britain, Cameron; Germany, Merkel; Israel, Netanyahu; Japan, Abe. That's actually a little unusual, because even when you could say the top leaders don't have the personal relationship, that when you have the alignment of the parties and the governments, there will be a lot of connections among cabinets, there will be a lot of connections among the legislators that are in the party in power that will be able to connect and support the heads of state relations. That the United States has been disadvantaged with. That's just the luck of the draw, frankly. But with France you do have that—granted, with the most unpopular government France has had since World War II, but you do have that.

So this is a big windup to say that I am not someone who believes that this is just an optics, missed optics. I think that France has just experienced a 9/11 moment, and everyone and their mother turned out for a photo op and to support the French government, and the attorney general of the United States was in Paris the day before, and the United States, basically not through bloody-mindedness but simply through lack of focus, saw fit not to send anyone. Victoria Nuland was the highest-level U.S. official there, who notably was quoted as saying "F the EU" during the Ukraine crisis.

You could not have created worse optics on this. This matters a lot to the French people and it matters a lot to the French government. That's why I'm spending some time on it. I'm annoyed about this. As an American, I am annoyed about this. We should do better.

Let's talk about France. I'm surprised this didn't happen sooner, I really am. France is vulnerable in ways that other countries are less so.

They have the largest Islamic population in Europe, 8 percent of the population. The French people believe that it is much higher than that, by the way. In the polls that have been taken in France, the average French response is they believe that 31 percent of France is Muslim. I don't know where they're keeping them, but they think there are a lot of them.

I know that we are supposed to be saying that France is now all unified. We're supposed to be saying that we've got 3.7 million people on the streets this weekend, and so now there is this extraordinary response.

France is a deeply divided country. The Front National, which is the deeply xenophobic, anti-immigration, radical, right-wing party, got 34 percent of the popular support in the last polls taken in 2014. It was 18 percent back in 2010. They did not march, the Front National, this weekend. You're not seeing much media on that. They did not march.

The Muslim community in France does not feel itself being well-treated by the French government. They are incredibly disaffected. They are not integrated in society. They are largely living in very homogeneous communities, slums in many cases. Youth unemployment is high in France—I think it is about 24 percent—and it is much higher in the Islamic community, which skews young. We are going to see more of this.

Charlie Hebdo, you may have seen, just released a couple of hours ago what the cover for this week's edition will be. There will be 1 million copies printed, plus of course many, many others that will be printed in other countries. The cover shows Muhammad. It depicts Muhammad in a caricature and has a placard that says "I am Charlie" in French, "Je suis Charlie," which absolutely sanctifies free speech in France. If we believe that is the only right that deserves to be sanctified, then we should definitely promote that first and foremost. I suspect that in a group where we are talking about ethics there are many that are important, and it is not clear to me we are spending an equal amount of time on all of those.

We have more refugees right now in the world than at any point since World War II, 70 years ago. The World Food Programme actually had to suspend its support for Syrian refugees in December because there wasn't enough money that was actually coming in. The willingness to prioritize support for educating, feeding, integrating these refugees into Middle East and European societies is vastly less than it needs to be.

It is kind of identical to Ebola. No one cared about Ebola until the first person with Ebola came to the United States, and then we were going to spend as much money as humanly possible. It was late. And were Guinea and Liberia and Sierra Leone getting the international support they needed? Of course they were not. And how many more people died as a consequence of that? And how much more did those West African tiny economies suffer as a consequence of that?

That is precisely what we are seeing with the Syrian and Iraqi and other countries' refugee situation across the Middle East and Europe. And does that mean that we will see much more radical Islamic violence in these countries? Yes, it does. Does it mean that we will see more populism in Europe to respond to that, that will itself be very damaging and very other-oriented in its violence? Of course we will.

Just today we had record numbers in anti-Muslim demonstrations in Dresden, where there was also the firebombing in Germany of the newspaper in Hamburg yesterday following their publication of these Charlie Hebdo cartoons. This is a deeply ugly trend that is structural across Europe. It will not be fixed. And furthermore, it is coming at a time when the Europeans are farther apart between the periphery and Germany in what kinds of policies they should be putting in place.

In the teeth of the Eurozone crisis, the economy of course looked much worse in Europe. But the politics were much better. They were aligned. They were so aligned that the Germans were basically putting in governments in Italy and Greece to do the bidding of the European Community. The willingness to support extraordinary austerity to ensure that in return there would be money granted by the Germans, by the Europeans, that would allow these countries to get back on their feet and become more sustainable, that happened.

Now we are in an environment where austerity will be rolled back. If SYRIZA [Coalition of the Radical Left] wins in upcoming [Greek] elections, austerity will be rolled back. That doesn't mean Greece will leave the euro area, but it certainly means you are setting yourself up for another economic crisis. And if Podemos wins in Spain and there is a coalition government later this year, the same thing.

And is France going to be spending a lot more money on security going forward? Yes. What does that mean for their budget? Are they going to hit their targets? Much more problematic. Will the Germans respond well to this? I doubt it very seriously.

So, unfortunately, the politics of Europe, grassroots-up, top-down from Germany, outside and geopolitically, are really toxic.

And I haven't mentioned Russia. The United States, as we know, is prepared to fight the Russians to the very last Ukrainian. That has been going on now for almost a year. But the Europeans, of course, are taking the economic hit here, not the United States, which is one of the reasons why the French and others—the Visegrad states have been increasingly publicly opposed to sanctions (Hungary, Slovakia, Czech Republic). We have seen this from the Italians to a degree, from the Spaniards as well, again most directly from the French over the last few days. I suspect going forward that is not going to get easier, it is going to get harder.

I started with some positive stuff. It is going to get worse as we go around the world. The outlook for Europe was our top risk this year, the politics of Europe. It's an enormous challenge.

Let me spend a few minutes talking about a few other things, a few other places in the world, and then we will open it up to questions. I thought I would spend most of my time on Europe because Paris is so raw and everyone does want to talk about it. I understand that I am doing you a disservice because I'm not hitting what's going on now. A couple other big things are going on.

I'll talk a little about Russia, talk a little about oil. They're a little related. Oil prices are down about 50 percent from where they were six months ago. The implications for China are really positive. Knock-on implications a little more negative. If China and Xi Jinping are able to restructure their economy more successfully, that will mean much less commodity intensivity in their growth in the coming year.

Now, many countries have taken advantage of that for some 35 years, this massive wave of industrialization from China. If you've been selling commodities into China, you are very happy. Coming out in 2015 and going forward, they are going to have a problem adjusting to that—not the Chinese, but, let's say, the Brazilians, the Australians, the Indonesians, Thais, many of the sub-Saharan Africans. That is going to be a challenge going forward. So that's a knock-on risk, not necessarily the way you'd expect in China, but that's interesting to watch.

I don't believe that 2015 is going to be the year that oil producers collapse, with the possible exception of Venezuela. Last year Venezuela balanced their budget at $162 a barrel, which is just over $110 more than what it is actually at. They're out of everything right now. They're out of toilet paper—you guys probably saw this—they're out of breast implants, a complete disaster in this country. [Laughter] I guess it is a funny thing. I just saw that today. I didn't realize that was a big import market, but I guess it is. But also the best ice cream store in Caracas closed because ostensibly it didn't have milk, and then the government said, "No, we do." For me that would be the biggest problem because I love that sort of thing.

But even Venezuela just got a commitment of $20 billion additional, yesterday I believe it was, from China in terms of investment. The Chinese can pick up a lot of goodwill and lot of great commercial terms on the cheap right now for countries that the Americans don't want to deal with. They're doing that with Venezuela. They are going to do that with Russia in an even bigger way.

So the ability of the United States to isolate and the ability of the United States to use the stick against other countries if China doesn't want us to, that has gone way down. America's ability to tell the Chinese what to do has gone way down. Such a different environment.

Hong Kong—so interesting. We expressed such concern for the Hong Kong Chinese when they demonstrated. We were very concerned that they aren't going to have suffrage, as had historically been promised. It won't be democratic, it will be more like an Iranian system, where the Chinese government gets to choose who is in the election and then they get to vote among those candidates. It's kind of like Iran. And the Brits expressed a great deal of concern.

I was very interested. The Chinese government basically came, and the Hong Kong government, and the demonstrators said that if you do not leave, if you do not step down, then we are going to occupy all of your buildings. The Hong Kong government responded and said, "You know, that's really not going to work for us. But instead, how about nothing? Would nothing work for you?" [Laughter]

And nothing actually ends up being a perfectly good deal because no one is going to support them. This is part of the issue, and you have seen that. So that's not going forward.

There were complaints from dissidents in Hong Kong that the United States really did a disservice to the Hong Kong Chinese by not providing support. I disagree with that. The worst thing that could have happened was the United States provide support and get them to believe the United States would really be there, and then they get mowed down by China, and then the United States does nothing. That would have been a disaster.

The reason I know that is because that is exactly what happened in Ukraine. The United States actually allowed the Ukrainian government to believe that the United States was going to support them. That was a very big mistake. I mean we sent the director of the CIA and we sent the vice president—more important than Paris—we sent the secretary of defense; we invited the president of Ukraine to the NATO summit—it was kind of "Look but you can't touch; you're not going to be a member, but you can come; it's really a nice organization." We had a hashtag campaign for them.

It was a big deal—so much so that the Ukrainian government started to believe, "maybe we can militarily get rid of these Russians." Crazy idea. And now over 5,000 Ukrainians are dead. We have some complicity in that. Let's be very clear. We at least do not have complicity with Hong Kong, right?

Unless you are really going to support the Ukrainians, which involved things that no one in the United States—McCain is prepared to bomb people, but he's not prepared to actually say, "No, we have to go in with troops and support the Ukrainians." Different story, right?

So let's be clear. The United States is in a different place.

So petrostates are not going to fall apart. The most dangerous issue with oil being down as much as it is, is probably that the Russians are more in a corner. But even though they go down with oil prices down, Putin's approval ratings are still in the high 80s. Why? Ukraine, Crimea, demonization of the United States and Europe—if he feels a problem on the economic side, do you think he is going to respond on the political side? Of course he is.

I was very concerned in the last few days about German government websites being attacked and shut down by the Russians. That has not happened before. That relationship is very fraught. Indeed, it is a dangerous situation. The ability, the willingness of the Russians—Putin believes that the United States is not trying to destroy Russia. Putin believes, correctly, that the West is trying to punish Putin. They are going after oligarchs, people close to him. They want to squeeze them and undermine Putin's popularity.

Putin calls that a policy of regime change. So does his minister of defense, so does his foreign minister. I mean if you really believe that and you are Putin, you mean to say you're not going to fight back? You are definitely going to fight back. So I worry about that.

Those are a few of the things that I see happening in the world in 2015. It's a challenging environment. We are not going to feel much of it in the United States. As a consequence, the interest and willingness of the Americans to truly try to be a productive part of helping to resolve some of these will be more limited. The countries that could play a bigger role for many reasons have less capacity and they are really distracted—Europe beyond all. As a consequence, the world in 2015—maybe the United States is doing better—looks a lot more dangerous, looks a lot more vulnerable.

This is one of these years where I just kind of fear that some shoes are going to drop. I'd be doing everyone here a disservice if I didn't say that. At the very least, we start with the most honest I can be and then we see where we go from here.

Anyway, that's 2015. Happy New Year.


DEVIN STEWART: I would like to just throw one out real quick, Ian. This is probably the hardest one of all because it is huge. You are talking about how the United States might be okay but the world less so. How do you think about American foreign policy responsibility to global security in the 21st century? Now we are fully in the 21st century. How do you wrap your mind around that?

IAN BREMMER: I think the most important thing the United States owes to the international community is to be more clear about what our interests are, what we actually want to do, what our goals are, how we are going to behave.

I think that if you are in a relationship with someone—a spouse, a girlfriend, a boyfriend, whatnot—and you have been together for a while, and suddenly something has changed, and you know it because you know this person better than anybody else, and you ask them, "What's up? What's going on?" and they say, "No, no, no, no, everything's fine, it's exactly the way it was before"—if this relationship is very important to you and you are fully aware that this person is being duplicitous in some way, then you will believe the absolute worst—"Oh my god, there's cancer, there's an affair"—it's whatever, right?

I fear that in the United States right now we are having a bit of an existential crisis. We don't really know what we want, and we are not being straight with our allies—"No, no, no, it was just a quibble." It's not a quibble. Own it. Owning it is better, right? I mean you make yourself feel good.

It's like the way I feel on climate change. You go to the Maldives—"No, it's really important to us." That makes us feel better. Go the Maldives and say, "You know we're going to try, but we're not optimistic this is going to get done, and so we have to find a way for you to get a new country because yours is gone." That doesn't make us feel good, but it actually shows a level of compassion and empathy for the people in the Maldives.

I think we have to be straight with the Europeans and we have to be straight with the Canadians. When Obama says to America's closest ally, Canada, "There is no country in the world"—and he talks right after the midterm elections about the Keystone XL pipeline, and he says, "Why would we support the Keystone XL pipeline? It does not benefit the United States at all, it only benefits Canada." Canada is America's closest ally. Do you mean to say, President Obama, that anything that supports America's closest ally has no political utility to the United States? If that is what you mean, then would you say that? Because I know that I've heard just how important, in other speeches from Secretary Kerry and others, that they're such an important partner and we're such great allies and we're so close to each other.

The mixed messages really don't work, right? So I'm not suggesting the United States has to return to being the global policeman. I'm not suggesting the United States should look at our energy situation and our food situation and say, "We should just steer clear and focus on ourselves." I'm not saying that we need to choose either of those, or something in between. What I am saying is we really owe it to our allies to be clear with them on what we are and are not going to do.

The Canadians should really not hear on CNN that we are not going to go into Syria. They should hear it directly from our president and secretary of state. It is appalling that something else would happen.

The 2016 election is coming up. We have to demand that from our leaders. I will. I will be out there, I promise you. I'm one voice, though I'm becoming a louder voice, but I'm one voice. But a lot of us should do this. Carnegie Council needs to do this. You need to do this. You are thought leaders. You have influence. We are megaphones.

I don't care if you are a Republican or a Democrat, I don't care if you are an isolationist or an interventionist, I don't care what you think about what we should be doing in Syria or France or any of these places, but demand from the people that we are going to vote or not vote for in 2016 that they tell you, they tell us, the American people, what they really do and do not support. If it is just American exceptionalism—we are going to do everything and we are going to be everything to everyone—we are in serious trouble.

QUESTION: James Starkman.

Ian, I'm a big fan, as everybody is here—and we enjoyed your gig on Charlie Rose recently, by the way, too.

IAN BREMMER: Thank you.

QUESTIONER: With weak and ineffective partners in places like Yemen, Nigeria with Boko Haram, obviously Iraq and Afghanistan, can we realistically hope for anything better than containment of ISIS and al-Qaeda in the Arabian Peninsula going forward, and in Nigeria too, which is becoming an increasingly serious problem?

IAN BREMMER: I'm glad you asked that question. I'm actually putting together a piece on Boko Haram now that I will put in Time in the next day or two, because no one is paying attention to it. We had 2,000 massacred on the Nigerian-Chad border last week that got absolutely no attention. Apparently, there were no cartoonists there. It hurts, doesn't it? I need to say these things.

I just gave Obama a fair amount of criticism for not sending anyone to Paris. Much worse than that was President Jonathan from Nigeria showing up in Paris when he has done so little to respond to what has been self-declared as another Islamic state in the north of his country, with elections coming up, and the lack of military response, the lack of domestic focus and capacity. It has been astonishing.

There is, as you know, a massive divide, north and south, in Nigeria. All the resources are in the south. All of the radical Islamists and population are in the north. There is no question that in that sort of an environment containment would be a huge win.

Now, I think with the Islamic State in Iraq and Syria we can do more than containment—and we are. I actually think that the U.S. policy on ISIS has not been horrible.

I think in this case people criticized Obama for not having a strategy. I think that if you actually want to have a real team and you are not planning on being in the lead, it behooves you not to tell everyone what the strategy is until you go and talk to people and say, "What do you think we should do?"—which they did. As a consequence, they built a coalition that is fairly robust in Iraq. On Syria?—eh. But on Iraq they have done a pretty good job, so much so that the Kurds in the north and the remnant Iraqi government in Baghdad has actually gained some ground back and they have pushed back ISIS. ISIS is now having to spend an awful lot of that money that they stole and the weapons that they took from the Iraqi government that were American that fell out of Mosul, and they are having to use them. That's good.

So, on balance, I think we can do more than containment with ISIS. I think that containment is the best we can hope for in the near term.

We probably won't get there in Nigeria.

I think we should not pretend that the European situation is the worst. It's the one we'll pay the most attention to because the economics will matter much more to us.

But let us be very clear. In the aftermath of what happened in Paris, the violence against Muslims in the region—they are the ones that are taking 99 percent of the hit for militant Islam; it's not France. In fact, we saw an al-Qaeda attack in an café in Yemen, I believe the day following the Charlie Hebdo attacks, with 60 dead, and I didn't see it covered anywhere in the United States. We saw another al-Qaeda attack by al-Nusra, their affiliate in Lebanon, over the weekend that I think killed another 15 or 20. These things are happening with insistent regularity, and thus far there is no real effort at grassroots containment.

QUESTION: Catherine Dumait-Harper, former representative to the UN of Médecins Sans Frontières/Doctors Without Borders.

I wonder if you could talk about our dear friends the Saudis, because we always hear on the media here in our country about "the bad guy in Iran." No one talks about the Saudis. If you think about their role supporting ISIS and others, and we are talking about the oil, so also there is a link there, I would like to know if you could talk about the Saudis and what you see for this year coming with Iran.

I just would like to make a small comment. The Front National yesterday did demonstrate, 1,000 of them, but they were excluded, fortunately, from the major march, and especially in Paris. Thank you.

IAN BREMMER: That's interesting. I did see that there was a small number that were demonstrating themselves, the Front National. I saw the founder of the Front National saying, "I am not Charlie" very explicitly. The French government claims that they did invite them. Marine Le Pen actually said, "No, they weren't, it's clear that they were going to be marginalized."

It's a tough one. I understand, if I were the French president in that environment, absolutely politically I wouldn't want to use this event to wrap legitimacy around the more established parties in France. But the challenge goes much deeper than that, as you know.

The Saudi situation is very interesting. There is no question that there was Saudi money that was going to ISIS in the early days. I believe that to the extent the Saudis are aware of any of that, they have cut it off at this point. That organization has grown vastly beyond what they thought it had been and now does pose a very direct threat to them. ISIS has actually called for a tax directly within the Saudi kingdom. They are very worried about that.

The Saudis are, of course, providing a lot of support, not just domestically for stability in Saudi Arabia but also to Egypt, also to Lebanon, also to Jordan. There is a lot of Saudi cash.

The Saudis are also trying to integrate much more tightly the Gulf Cooperation Council [GCC]—not just economically but also militarily, on the naval side and also in terms of counterterrorism.

They have pushed very hard against Qatar, which has been a much more significant problem in funding ISIS, saying, "Look, that's not going to be tolerated. You can't provide the support you have for a lot of the nativist, more militant Islamist groups." That includes the Muslim Brotherhood, which has been completely disenfranchised now in Egypt, of course.

Qatar, for the time being, certainly if you watch coverage on al Jazeera, has gotten back in line, in part because they supported all the losers in the region, but in part because there is this growing sectarian fight between the Sunni GCC and the Iranians.

I don't believe we are heading for a deal with Iran. If you asked me 12 months ago, I thought it was close but I thought we'd get there. I thought there was a window.

The problem was a year ago the United States and Iran, when they negotiated on the nuclear side, all they were talking about was the nuclear issue. Now ISIS is a bigger priority for both. That means you start creating linkage. It gets much harder to do the deal, especially because the Americans and the Iranians both do ultimately want a nuclear deal, but the Americans and the Iranians are not playing for the same team on ISIS. That's very clear. When the United States has the big meeting in NATO and they bring everyone together, Iran is not a part of that meeting. They are trying not to fight each other. They are doing that pretty effectively with the coordination of Baghdad. But that's very different from saying it's going to work.

I think right now the White House—they gave them seven months on the next round of negotiations, as opposed to three. I think the baseline right now is that "let's just kick the can down the road, let's have an effectively frozen conflict, we'll keep the Iranians a year away from breakout capability on the nuclear side, we'll continue to have the limited sanctions relief that they got in the interim deal, and just keep it there and let the next president deal with it." I think that is the baseline of where they are right now.

QUESTION: Susan Gitelson.

Looking to the future, how about cybersecurity? This has become such an enormous problem on the international scene, with North Korea and others, but also private enterprise, Sony and banks being hacked, and Target, and so on. These are huge flashpoints. What can the United States do about it?

IAN BREMMER: The U.S. response on North Korea was very interesting. The United States clearly believed that the North Koreans were involved in the Sony hack—they obviously had motive and, according to the FBI, there is pretty strong evidence. Some of that was provided publicly.

I believe them. I do think it was North Korea. One of the reasons I believe it was North Korea is because when the United States responded, there were some sanctions, but also the North Korean Internet—such as it is, some 1,024 ISPs—was brought down repeatedly. Now, all of those ISPs run through China. There is no technical way the United States could have actually brought those all down without Chinese spillover, hitting some Chinese sites, unless the Chinese provided at least some technical understanding and support. So I believe they did.

The United States definitely provided what the United States believed was some proof of the North Korean attacks. I think the Chinese would not have supported that from the United States if they hadn't accepted that the North Koreans were behind it.

I also think it is very interesting that the North Korean response since then has been propaganda and quiet. In fact, they came out a couple days ago and they actually said that if the United States was prepared to suspend ongoing South Korean joint military exercises that the North Koreans would be willing to suspend their own nuclear testing going forward.

I'm not suggesting we should believe the North Koreans. I just find it interesting that if the North Koreans had done nothing to the United States and the United States put sanctions on and closed down their Internet, I would not expect that would be the response of the North Korean government. So I actually think this has been handled pretty well.

The Chinese did shut down Gmail and they made that very public. So clearly, I think the Chinese also wanted to show some of the hard-liners in the government, "Hey, we're not going to just be the lackeys of the United States." Gmail came up again very quietly a few days later. No one talked about that. It is always interesting to see the things that happen that people don't report on. It just showed up, and Google made no deal about that at all. Interesting.

So I think the North Koreans will be more careful before the next time they try to engage in a cyberattack against a very poorly defended U.S. company. I think they will be more careful.

I would love to know who was advising Sony Pictures Entertainment on geopolitical risk. I know who wasn't. I think that's fairly clear. [Laughter] That's a very self-serving comment, but there you have it.

I absolutely worry more about Russia on this. The Russians have vastly more capabilities and they have more motive. I believe that U.S. banks are going to be very vulnerable to cataclysmic Russian cyberattacks in the coming years. I think that's a very serious problem.

The idea that the United States can punish the Russians with impunity for doing things that we don't like when the Russians absolutely feel that the shoe is on the other foot, that it has been NATO enlargement and missile defense and energy diversification of stuff that belongs to the Russians but moving to Europe from the Caspian instead, and then Ukraine—no, no, no.

I'm not suggesting I agree with Putin—I don't. I'm not suggesting I think Putin's a good guy—I don't. But I am suggesting, and this is another question—you asked about U.S. foreign policy, what we can do—and this is an old hobbyhorse of mine, but it really matters on Russia—if you have an adversary that cannot hurt you, it might be a humane thing and an ethical thing for you to try to understand what motivates that person. But there's not much downside if you do not. If you have an adversary that is capable of hurting you, it really does behoove you to try to understand what motivates them so that they will be less likely to lash out.

I think the willingness of the United States—the U.S. media, U.S. public intellectuals, and the U.S. government, on both sides of the spectrum—have been thoroughly unwilling, and maybe even incapable, of trying to understand what it is that is motivating Putin. I think that is the reason why our Russia policy has failed so dramatically, in ways that are not only hurting the Ukrainians and hurting the Europeans, but the most significant implication of our U.S.-Russia policy has been the massive benefits that China has gotten, which I am fairly certain was not the intention of the United States.

When you see those kinds of outcomes, you cannot stand up and say, "This policy has worked." You can't do that. I think we have to do a better job, as the Russians, the Chinese, and others have the ability to say no and have the ability to cause damage to ourselves and to our allies—more importantly to our allies.

That is something we have to spend a lot more time on. That should be our resolution for 2015. We should all work on that.

DEVIN STEWART: To help us understand, what is motivating Putin?

IAN BREMMER: Well, as I said, I believe that Putin's approval ratings are coming from this narrative of NATO and missile defense and energy diversification and Ukraine. Also keep in mind, Southeast Ukraine is where so much of Russia's military-industrial complex supply chain actually comes through, its helicopters and its airplane componentry, its ballistic missiles, its tanks.

I find it very interesting that there is an important factory in Central Ukraine that builds helicopter components. It's clear the Russians aren't going to take this thing, because it's Central Ukraine and they'd have to invade all of Ukraine to get it. The Russians are building as fast as they can a replacement factory in Kaliningrad. What's very interesting is the factories that are in Southeast Ukraine that the green men presently control—the Russians aren't rebuilding those factories. And there are some factories in Southeast Ukraine that are outside of Russian control. They are not rebuilding those either.

Does that tell us anything about Russia's intentions of where Ukraine will be in the next year or two years or three years? I think it behooves Americans thinking about policy towards Russia to understand. And this is real money they're spending, this is billions of dollars to put these plants in place. Why would they do that when cash is constrained in Russia? Are they blustering? It's not like they're promoting the fact that they're building them. They're just doing it.

I think we need to do a better job of trying to understand what is motivating the Russians. I don't think that as a consequence of that we say "we like them;" I don't think we then say "we support them." I think what we want to say to ourselves is "we understand them" so that we can more effectively engage in policy that will work to support what we want.

I am not even suggesting we are trying to find compromise. I know that we are trying to advance our interests. But, please god, let's do it effectively. It seems to me that should be a no-brainer.

I mean there are very few Americans that want to spend an awful lot of time—we might do charitable stuff, but there are very few of us that are willing to spend tax dollars to do things that will make the world more peaceful. Very few of us want to do that. But there are a lot of us that would be willing to spend a lot of tax dollars to do things that would advance our interests more effectively. When we don't do that, that's an ethical no-brainer. That should be our baseline. When we're not doing that—we shouldn't even be talking about the broader ethics if we're not doing that. We have to start there.

QUESTION: Andrew Medvedev.

To what extent do you think economics is a play with the current level of discord? One way to look at it is to say the world is a poorer place than it was in 2007, in some cases maybe 2000. When people feel poorer, there is less willingness to engage—you know, "What's mine is mine and I'm a lot less interested," whether or not it's immigration in Europe, whether or not it's U.S. global engagement. Can we grow out of this problem? To what extent, if the policies are oriented towards global growth and that permeates down, will that solve some of the issues, or is this not a factor at all?

IAN BREMMER: It's one of many factors. It's an important factor. I mean, look, the Arab Spring happened because of the Eurozone crisis. It was North Africa—Tunisia and Egypt—and the Europeans fell off a cliff, and so did all the remittances from all the people living in those countries that were in Europe and sending money back, and tourism fell off a cliff, humanitarian aid fell off a cliff, trade fell off a cliff. So then, suddenly, in Egypt and Tunisia you get massive social discord. If the Eurozone crisis had not hit, you would not have had that instability.

There is no question that oil prices being much lower is going to lead to much more instability in the Middle East as a lot of these governments don't have the money to actually pay for a lot of the civic programs or pay for the state-supported sector to keep loyalty and have more effective repression. Either way you take it, carrot or stick or both, it is more challenging. So a better economic environment will make a difference.

But also, let's be clear, if the United States was poorer but needed more energy from the Middle East, there would be a stronger direct national security interest and the United States playing a bigger role there. The United States right now is doing much better than it has been at any point since the financial crisis, and yet I see less interest in the United States providing engagement.

Why? Well, the United States fought the longest-standing war in history in Afghanistan and didn't accomplish very much. It didn't go very well for the Americans. They are sick of it. It cost a lot of money and a lot of Americans died. A lot more Afghanis died.

Again, there's a lot of pique in saying, "Hey, the war is over!" First of all, the families of the 11,000 soldiers that are actually still based in Afghanistan probably really don't appreciate that. That does not show a lot of empathy for them. But more importantly, the Afghanis who are still very much at war and have just experienced the worst loss of civilian life at any point in the last, I think, seven years, they also don't appreciate it.

So the answer is much more complicated than me just saying, "Yes, we'd like to see more growth." We'd particularly like to see more growth in areas that are really falling off the ability to pay for baseline stability.

But then you also have issues of growing inequality within countries. I'm not going to throw away Piketty. I think that he's got lots of problems. He doesn't look at the world globally, which Krugman, who I usually don't like but in this case I think made the right point, that global inequality has decreased radically—that has been a very positive thing. But within a lot of these countries that has been an issue, so distribution clearly matters, not just absolute growth.

Social media, the ability to be a megaphone; the breakdown into demographics that have much narrower slices, and so therefore I watch Fox News, you watch MSNBC, the rest of us just watch plane crashes on CNN, but we don't talk to each other, right? [Laughter]

When did CNN just become a network that covers plane crashes? I'm bemused by this. Seriously, there is space—like you've got left, right, and plane crashes. [Laughter] Why can't they just be the BBC, because internationally they have—I think it's Wolf Blitzer, I think Wolf just likes plane crashes. I think that is driving a lot of this. Do you see his eyes? They go crazy. He's very excited about that.

Don't ever give me an espresso before I do these things. That's like rule number one.

Did I answer your question?

QUESTIONER: Yes, you did.

IAN BREMMER: Good. Next question.

DEVIN STEWART: Thank you, Ian. I think they do storms too, storms and plane crashes.

IAN BREMMER: They do storms. And if you can get a plane crash in a storm—

DEVIN STEWART: That's the perfect storm.

IAN BREMMER: There's a story there.

QUESTION: Hi, Dr. Bremmer. I'm Frank Malafronte. I'm a big fan.

If people like us want America to use our power in an ethical manner but we might be competing with other actors who don't want to use their power ethically, they want to use it maybe in a more self-centered way, is that a hindrance to our use of our power? And, if so, how can we overcome that hindrance and use our power the way we want to?

IAN BREMMER: I do not believe that self-centered and ethical are in conflict with each other. Maybe I believed that briefly in high school. I think that enlightened self-interest just means longer term more sustainable.

So if I think about the things that the United States is doing in the near term that clearly benefit a lot of people but long term will lead to, let's say, a China that much more actively wants to undermine the dollar and sees the United States as more of an adversary and has the Russians with them, these people are still going to be alive in the United States. They have kids. They don't actually want to move in that direction.

I think so much of this is not about ethical versus self-interest. I think a lot of this is about people who are really stressed, they're really stretched, they come from a background, they don't necessarily have all information, they are making decisions in a very suboptimal way. That I think has much more to do with it.

I look at people like Daniel Kahneman, I look at people like Cass Sunstein. I see how psychology has had a behavioral revolution. Psychologists were in their ivory tower and they would write about these theories, and you have your Freudians and you'd have your Jungians. Now you actually have psychologists that go out into the world and they say, "We do things that don't even make sense for our own self-interest, and we can study that, and we can sort out how you market in a supermarket, we can sort out how you think about a public safety program in a way that will make it better for everyone, if you just were aware of that, just analytically."

And you see political science, my field, has not yet had a behavioral revolution. Political science in academe still actually is theory-based. There's not a lot of analytics around it, where you go around and actually see what does and doesn't really work. Part of the reason is because the people that are practicing political scientists in the real world are frequently ideologues, which is not true in psychology, which is not as true in economics, though that is a problem in economics. But in political science it really is. I mean if you are going into policy, you support a party most of the time. That means that they are wrong and you are right.

One of the things that excited me—why did I start Eurasia Group? I started Eurasia Group, in part, because I'm a political scientist who doesn't really like politics—in fact, I'm very averse to it—but I really love the idea that if you study how people work politically around the world that you could actually do better for them. Having a company where you are looking at the political factors analytically and how they actually work, that needs to happen. But that's just my little company.

When that starts happening more broadly in the discipline, I think we'll actually benefit from that. We'll still have problems.

But go back to that point I made right before. When you are not even doing it efficiently and effectively for your own self-interest, you don't need to worry about the conflict between self-interest and the Dalai Lama, or whoever you want to pick—or the Bhutanese. You don't need to focus on that. You can just focus on getting it efficient for the things that you want, just for the lobbyists—I mean for Soros and the Koch brothers. If you can get them to spend money efficiently in ways that will actually benefit them, as opposed to enormously inefficiently, that would be a huge lift, just that, both sides of the political spectrum.

That's where I come apart. It's like what is the politics of the achievable, start with there, and then after that you can get to ideology.

Thank you.

DEVIN STEWART: That was wonderful, Ian. Thank you.

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