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00:00Hello, Telesure English presents a new episode of China Now, a Wave Media's production that
00:14showcases the culture, technology, and politics of the aging giant.
00:19In this first segment, China Currents dives into the top stories of the week, including
00:23the dismissal of a US request to study China's moon soil and the reboost of China-India's
00:29relations.
00:30Let's see.
00:31China Currents is a weekly news talk show from China to the world.
00:38We cover viral news about China every week and also give you the newest updates on China's
00:43cutting-edge technologies.
00:44Let's get started.
00:55Welcome to China Currents, your weekly news report on what's happening in China.
00:59I'm Derek.
01:00In this episode, US application to study China's moon soil denied again, three Chinese astronauts
01:06successfully returned to Mars from China's space station, Macron has made a decision
01:11against China that makes France's farmers suffer, Brazil has replaced the United States
01:16as China's top corn exporter, China-India relations back on track.
01:21First let's look at why US has failed to apply China's lunar soil.
01:25On 1st of November, Chinese scientist Wang Junqiang from the Ningbo Institute of Technology,
01:31Chinese Academy of Sciences reported the US has once again requested samples of lunar
01:36soil from China, but this request has been not approved once more.
01:41The obstacle preventing US access to these samples is a US law enacted 30 years ago that
01:47imposed sanctions on China.
01:49As noted by Spacenews.com, the US efforts to study China's lunar soil began with an
01:55internal email in late 2023, which highlighted the unique value of the Chinese lunar samples,
02:01according to the Chinese media Outlet Guancha.
02:04So what makes China's lunar soil so unique?
02:07The first batch of lunar soil was collected by the Chang'e-5 spacecraft in 2020 from
02:13an area of the moon that had never been visited by humans, making it exceptionally valuable
02:19for scientific research.
02:21For instance, during Putin's visit to Beijing in 2022, 1.5 grams of this lunar soil was
02:27provided to Russia as a research sample.
02:30In October of this year, Russian scientists discovered two unique crystals within the
02:35sample, indicating geological activity on the moon that had never been observed before.
02:42The US likely submitted yet another request for lunar soil samples due to recent findings
02:47by Chinese scientists who discovered water within the new sample.
02:52In June, China's Chang'e-6 spacecraft successfully landed on the far side of the moon, marking
02:58the first time humans have collected samples from the region, returning with approximately
03:03two kilograms of space mass.
03:05An August research report stated that China has found a new method to utilize lunar soil
03:11for large-scale water production, and Professor Wang Junchang mentioned earlier was one of
03:17the project's participants.
03:19According to Chinese official media, by studying Chang'e-6 lunar soil samples, researchers
03:24at the Chinese Academy of Sciences found that the lunar soil has stored large amounts of
03:29the hydrogen due to billions of years of radiation from solar wind.
03:34When heated, the hydrogen reacts chemically with the iron oxides in the minerals, producing
03:40elemental iron and significant quantities of water.
03:44When the temperature rises above 1,000 degrees Celsius, the lunar soil melts and the water
03:50generated from this reaction can be released as water vapor.
03:55One ton of lunar soil can produce approximately 51 to 76 kilograms of water, which is equivalent
04:02to over 100 bottles of 500 military bottled water.
04:08This is basically enough for 50 people for one day.
04:12In response to the discovery made by Chinese scientists, NASA Administrator Bill Nelson
04:17was quoted by Reuters, stating that water found on the moon could be utilized to produce
04:23hydrogen rocket fuel for further exploration of Mars and other destinations.
04:29The moon's gravity is only one-sixth that of Earth's, meaning that the same type of
04:34rockets launched from the moon could carry six times more payload than those launched
04:39from Earth.
04:41Major discoveries on the far side of the moon have undeniably given China a significant
04:46advantage in the space race.
04:48Interestingly, American scientists are limited in their access to this unique sample due
04:53to a U.S. law known as the Wolf Amendment.
04:57Enacted by the U.S. Congress in 2011, the Wolf Amendment prohibits NASA from using government
05:03funds for direct bilateral cooperation with the Chinese government or affiliated organizations.
05:10At the time, the U.S. cited counselors about the nature and goals of China's space program
05:15as the rationale for this legislation.
05:18However, for Chinese researchers, the Wolf Amendment is seen as a betrayal.
05:23On the same day the amendment was issued, the U.S. space shuttle Endeavour completed
05:29its final mission, and NASA canceled press that had been promised to all Chinese journalists.
05:34Ironically, according to Forbes, Chinese scientists played a key role in building essential
05:40components of Endeavour's two-billionth payload, the Alpha Magnetic Spectrometer.
05:46It is a space-based detector designed to study the universe and its origin.
05:51It is also the unique magnetic spectrometer on a space station and will operate on the
05:56ISS for its lifetime.
05:58Thirteen universities and research institutes from China contributed their wisdom and funds
06:04to this project.
06:05However, when NASA thanked them on its official website, it mocked China and its Taiwan province
06:10separately.
06:11These Chinese researchers may never have thought that the fruits of their intellectual labor
06:16would eventually become propaganda materials used by the United States to divide their
06:21motherland.
06:23This kind of racial discrimination, which both want to exploit the intellectual resources
06:29of the Chinese and attack China, has deeply hurt the Chinese people.
06:33Now it's China's turn to reject the application from the United States.
06:37In addition, in the paper on the Alpha Magnetic Spectrometer published by all the researchers,
06:43Petro Lavchenko, a Russian scientist with a permanent address at the Petersburg Nuclear
06:48Physics Institute, is included.
06:51However, on NASA's official website, the contributions of all Russian researchers have
06:56been omitted, and no Russian universities or research institutes are marked on the map
07:01in the Acknowledgements section.
07:03However, on the website operated by the European Space Agency, you can still find the original
07:09version and the markings of Russian research institutions on the Acknowledgements map.
07:15China isn't looking to take on the responsibility of leading humanity to become an interstellar
07:21civilization by itself.
07:23In June, Russia officially joined China's International Nunner Research Station project,
07:28which also includes participation from 11 other countries, including Egypt, South Africa,
07:34Pakistan, Serbia, and Venezuela.
07:37Chinese scientists have successfully tested the technology for making bricks from nunner
07:42soil and plan to use traditional Chinese mortise and tenon joints in the base's construction.
07:48The nunner base is expected to be up and running by 2036.
07:53If NASA can convince Congress to repeal the Wolf Amendment by December 2035, they might
07:59just make it in time for the nunner base's opening ceremony, if they still remember how
08:04to get American astronauts to the moon by then.
08:07Well, maybe China would still be willing to provide some humanitarian relief if NASA would
08:12ask for it.
08:13On 4th of December, China's Shenzhou-18 crew have returned home and successfully landed
08:18at the Dongfeng landing site in North China after more than six months in space.
08:24According to China Manned Space Agency, astronauts Ye Guangfu, Li Cong, Li Guangshu were all in
08:30good health.
08:31The trio lived on board China's Tiangong space station since April of this year and concluded
08:37their mission on 3rd of November.
08:39Before returning home, they greeted the incoming Shenzhou-19 crew members aboard the Tiangong
08:44on October 30.
08:46Chinese state media released a video showing three astronauts Cai Xuzhe, Song Lindong,
08:51Wang Haoze entering Tiangong space station shortly after docking.
08:56The six astronauts hugged each other and exchanged cheerful greetings.
09:00But their neighbor might not be as delighted as they are.
09:03Two NASA astronauts Sunita Williams and Barry Wilmore are stranded on the International
09:09Space Station for almost five months, despite initially planning to stay just eight days.
09:15In September, their defective Starliner returned to Mars, leaving them awaiting a scheduled
09:20return in early 2025.
09:22At the press conference for the Shenzhou-19 manned mission, CNSA spokesperson extended
09:27his well wishes to the stranded American astronauts on the space station and wished the two astronauts
09:33a safe return.
09:35Except the U.S. astronauts, the French farmers may also want their president to get back
09:39to the ground as soon as possible.
09:42On 3rd of November, China's Minister of Commerce Wang Wentao met with a French minister-delegate
09:47for foreign trade in Shanghai.
09:50During the meeting, two sides held discussions on recent China-EU trade frictions.
09:55On 29th of October, the European Union decided to increase tariffs on Chinese-made EVs to
10:02as much as 45.3%.
10:05According to AFP, Germany, Hungary and three other countries voted against the tariff hike,
10:11while 10 countries, including France, supported it and 12 countries abstained.
10:16France's stance has puzzled many in China, especially as France is once again serving
10:21as a guest country of honor at the China International Import Expo, with over 100 French companies
10:27participating, the highest number among EU countries.
10:31As early as July, the European Commission had already made a preliminary ruling on the
10:36bill to increase tariffs on Chinese EVs.
10:39The Chinese Ministry of Commerce has announced to impose a temporary anti-dumping measure
10:44on imported brandy originating from the EU.
10:48According to Investing.com, following China's decision, shares of Remi Cointreau fell by
10:535%, while Pernod Ricard dropped by 2.9%.
10:57LVMH, the parent company of Hennessy, also saw a 4% decline in its stock.
11:04According to AFP, on 70 September, around 800 people gathered in Cognac to protest,
11:10urging EU officials to postpone the vote on tariffs for Chinese EVs.
11:16This was the first protest by a French Cognac producer since 1998.
11:20In December 1998, the final Peugeot 205 rose off the assembly line more than 15 years after
11:27production began.
11:29It was being one of Europe's best-selling cars in the late 1980s and early 1990s.
11:35If French automakers were still as enterprising and creative today as they were in 1998, would
11:42Macron make the same choices when confronted with Chinese electric cars as he does today?
11:47Whatever Macron's answer, French vendors and farmers have already become part of the
11:52prize.
11:53Like the French farmers, the American farmers have also been victimized by their president.
11:58China International Import-Export opens in Shanghai on 5 November.
12:03And over the past few years, the food and agricultural portion has become one of the
12:07events most heavily trafficked.
12:10In terms of floor coverage and the number of exporters, a clear trend in recent years
12:15is that China is diversifying its importers of agricultural products.
12:21For example, Reuters reported on 1 November that Brazil has replaced the United States
12:26as China's top corn exporter.
12:29Until 2018, China was the largest importer of U.S. soybeans and corn.
12:34However, since Donald Trump declared a trade war against China and imposed tariffs on over
12:40300 billion U.S. dollars worth of Chinese importers, Beijing levied a 25 percent tariff
12:46on U.S. agricultural goods as a response.
12:49Consequently, China redirected much of its sourcing to other agricultural nations like
12:55Brazil and Russia.
12:56Data from customs reports show that as a result of this diversification, the share of soybeans
13:02imported from the U.S. dropped from 40 percent in 2016 to just 80 percent this year, while
13:08imports from Brazil increased from 46 percent to 76 percent.
13:13Similarly, after only a year of approving Brazilian corn, Brazil has already replaced
13:18the U.S. as China's top corn supplier.
13:21Moreover, as in 2018, it remains unlikely that U.S. agriculture would be able to secure
13:27enough alternative markets to offset these losses.
13:31USDA senior economist Sean Arita disclosed that the last trade war between the two nations
13:38cost U.S. agriculture over 27 billion U.S. dollars, losses that were ultimately mitigated
13:45by government aid.
13:46However, those years were exceptionally challenging for growers, and the long-term impact of the
13:51trade war meant that the U.S. ceded its share of the Chinese market to Brazil.
13:56According to a forecast released this month by the U.S. National Corn Grower Association
14:01and the Soybean Association, a renewed U.S.-China trade war could slash American soybean exports
14:07to China by roughly 50 million tons annually, a decrease of over 50 percent.
14:13U.S. exports are projected to drop by 2.2 billion tons if China imposes new retaliatory
14:19tariffs in the new round of trade conflict.
14:22These losses in U.S. agricultural sectors could grow even larger.
14:26On 25 October, Zhang Xinwang, Vice Minister of Agriculture and Rural Affairs of China,
14:33announced at a press conference that China's grain output has consistently exceeded 650
14:39million tons over the past nine years, and is expected to surpass 700 million tons for
14:45the first time this year.
14:47Obviously, this time, if the U.S. tries to torture the Chinese like they tortured the
14:52Soviets by restricting food exports, the ones who will suffer will only be themselves.
14:58Compared with the United States, India has recently shown more pragmatism and wisdom
15:03in geopolitics.
15:04On 31 October, news about India and Chinese soldiers gathering at the border to celebrate
15:10the Indian festival of Diwali got attention in China.
15:14Since 2020, when the blood clash in the Galwan Valley resulted in four Chinese and 20 India
15:20fatalities, the border friction between China and India has hardly stopped.
15:25However, recently, the incident suddenly reached a turning point.
15:29In October, during the 2024 BRIC summit held in Russia, China and India reached resolutions
15:35on issues concerning the border areas through diplomatic and military channels.
15:41According to the Press Trust of India, on 30 October, China and India completed a disengagement
15:47exercise at the Depsang and Demchok friction points along the LAC in eastern Ladakh.
15:53Future discussions on resuming border patrols are scheduled at the local commander level,
15:59indicating a commitment to reducing tensions on both sides.
16:03When the agreement was just reached, the Chinese people were happy that the soldiers from both
16:08sides could finally go home, but they also had doubts about India's commitment.
16:14This is because due to the religions and cultural diversity in India, the Chinese has always
16:19doubted how far New Delhi's will can be conveyed from the Sino-India border.
16:24However, on the day of Diwali, one piece of news gave the Chinese people great confidence,
16:30that is, Chinese and India soldiers exchanged candies together and celebrated the festival
16:35together.
16:36In India, it symbolizes the spiritual victory of light over darkness, good over evil, and
16:42knowledge over ignorance.
16:44This is a very good sign, China and India has both ancient civilizations that have been
16:49neighbors for thousands of years, with a long history of cultural and religious diversity.
16:55And we have a short break now, but we'll be right back.
16:57Stay with us.
17:08Welcome back to China Now.
17:10Global Conversations with Zhang Weiwei receives former Greek economy minister Yanis Varoufakis
17:15to speak about Europe's current challenges.
17:17Let's have a look.
17:19I remember you were once asked in an interview if you were again to become Greek finance
17:47minister today, would you do it differently from the past?
17:52And your answer was very blunt.
17:57You said, I would be far less pliant and far less diplomatic vis-a-vis the EU and vis-a-vis
18:06Berlin.
18:07As our topic today is with Europe or where Europe is heading, we think no one is better
18:15qualified than you to speak on this subject.
18:19Maybe we could have a dialogue.
18:22This very idea, EU as a design of the United States, is not very well known in China.
18:31For instance, I'm thinking of this with the rise of Europe for a time.
18:38And maybe you thought it's the Europeans' identity to show we are different from the
18:44United States.
18:45We didn't have economic autonomy.
18:48And some people even say that the very breakout of the war, cause of the war, was in one way
18:56or another the US attempt to whatever, destroy Europe.
19:03Another thing is the very cause of this war against Iraq, Saddam Hussein, had to do with
19:10Saddam Hussein's decision to use Europe to sell its oil.
19:15So do you think this is a fair assessment or it's completely wrong from your point of
19:22view as the EU's relation with the United States is more boss and the vassal state,
19:28this kind of structure?
19:31It's an interesting hypothesis.
19:32I believe it's more complicated than that.
19:34And allow me to explain why it's more complicated.
19:37Look, the Americans didn't want to destroy the Europe.
19:41The Americans were skeptical about the Europe.
19:45They were saying to Europeans, what are you doing?
19:47You want to federate, federate.
19:49But don't federate your money.
19:51Because the Americans are, whatever you may say about them, at least they are smart.
19:56And they are more practically minded.
19:59And they think globally.
20:01Germans do not think globally.
20:04They were at the time, you see, the German mindset, you have to understand, I appreciate
20:10it, I appreciate it.
20:11They just didn't want to be a global power again because of the trauma of the defeat
20:18of Nazi Germany.
20:20They wanted one thing.
20:22And I think Chinese people understand.
20:24They wanted to be the workshop of Europe.
20:28They wanted to make good washing machines and great propellers for your ships here in
20:35the shipyards.
20:36They wanted to make electronics.
20:38They wanted to make pharmaceuticals.
20:40They wanted to build things and make money out of that without dominating Europe or the
20:45world.
20:46That's not a bad thing.
20:48The problem is that this means you don't have an understanding of the macroeconomic conditions
20:57under which you can do it.
20:59You know, you have to, under capitalism, you need to worry about where the demand will
21:04come.
21:05Because the problem that capitalism has, as Marxism has taught us, is that it produces
21:11under consumption.
21:13Now, from 1945, or at least 1949, 1950, all the way to the mid-1970s and beyond, the United
21:24States created the conditions for American cars, German cars and German pharmaceuticals
21:30and German chemicals, to have markets.
21:33The Germans didn't have to think about it.
21:35The Americans were managing global aggregate demand.
21:38At some point, especially after 2008, that was no longer the case.
21:42And the Germans continued not to care about managing the macroeconomy.
21:47They thought that somehow, if they produced good things, good manufactured goods, they
21:53would sell magically on the basis of how desirable they are.
21:57That's simply not understanding how capitalism works.
22:02So, the Americans were looking at the Euro thinking, this is going to be a problem for you, folks.
22:07Think about it carefully.
22:09I have spoken to, for instance, an interesting conversation I had with Jack Lew, L-E-W.
22:18Jack Lew was the finance minister, the U.S. Treasury Secretary of Barack Obama.
22:24He was very, very angry with Europeans.
22:28Not because they had the Euro, but for the same reasons I was angry with Europeans.
22:34Because they were practicing austerity for the many, while printing money for the many.
22:39Now, I was, from a left-wing perspective, angry with what Europe was doing.
22:44He was from an American perspective, because he understands that a Europe
22:49which was imposing austerity on the German working class,
22:53essentially is pushing American industry to boost its net exports to the United States,
22:59and therefore to export unemployment to the United States.
23:06So, the American government was very angry with the European Union.
23:12One reason for the Ukraine war, one reason for essentially turning against Europe,
23:24by Washington, D.C., was that the Americans wanted to teach the Europeans,
23:29and particularly the Germans, a lesson.
23:31You cannot continue to export unemployment to the United States,
23:35just because you are not doing the right thing by your own people.
23:39And now, they have won.
23:42Because now, the German government is completely in a state of panic.
23:48You mentioned Saddam Hussein. Let me say something about that.
23:52I don't believe that America, the United States, invaded Iraq in the first Gulf War,
23:58because of anything to do with currencies.
24:02What happened was, remember it was 1991.
24:05As I was saying before, the difference between the United States authorities
24:10and the European authorities is that the United States authorities are good Marxists.
24:15Not in favor of the working class, but they think in Marxist terms.
24:19They understand that capitalism produces under-consumption,
24:24and American capitalism is constantly, constantly running the risk
24:30of not having enough aggregate demand for its products.
24:34So, essentially, it's just capital turned upside down.
24:37How to use this capital against the working classes of the world.
24:41But still, it's a Marxist way of thinking about it.
24:44So, in 1991, the Cold War ended.
24:48If you look at the national accounts of the United States up until 1990,
24:531989, 1990, the military-industrial complex of the United States,
24:59and in particular, the industry that produces ammunition,
25:04cruise missiles, Pershing missiles, were accounting for up to 8% of GDP.
25:128% of national income was accounted for by the production of these weapons.
25:19Now, you've got to understand, and I'm sure you do,
25:22that Congress, the establishment, is not united.
25:28There are some senators that represent the armaments industry,
25:32the military-industrial complex.
25:33There are other senators who represent the medical establishment,
25:39the insurance companies, medical insurance companies,
25:41the pharmaceutical companies.
25:42Now, they didn't want the money to be spent on missiles.
25:45They wanted it to be spent on them.
25:48Whenever the Pentagon brought to the Senate or to the House
25:53a bill saying, we need 100 billion more, 200 billion more,
25:571 trillion more, they were senators who were saying no
26:00because they were representing other interests.
26:02So, it's not a unified thing.
26:05While the Cold War lasted, nobody dared in the Senate
26:09speak out against the Pentagon budget.
26:13But when the Soviet Union collapsed, they did.
26:16They said, hang on a second, we no longer have an enemy.
26:18Why do we need more missiles?
26:20Why do we need more ammunition?
26:22So, this is my speculative theory.
26:25In 1991, remember, there was a major, major recession in 1991 in America.
26:32There is a very strong causal link between the reduction
26:36in expenditure on armaments with that recession.
26:41And they needed to start spending again.
26:44Now, of course, their warehouses were full of ammunition.
26:47How do you go to the Senate and say, we need more ammunition
26:49when you've got so much?
26:51You need to spend it.
26:53So, they invaded Iraq.
26:55Not only did they invade Iraq, but remember,
26:58Saddam Hussein was working for the United States.
27:01He was an ally of the United States.
27:03When Saddam Hussein, in the context, in the 1980s,
27:06of the war between Iran and Iraq,
27:09accidentally hit an American naval vessel,
27:12killed many American soldiers,
27:14Dick Cheney, who was working for Reagan at the time,
27:17flew to Saddam Hussein to pat him on the back and say,
27:22we know it was an accident, and to hug and be friends.
27:27So, people forget that.
27:29Saddam Hussein, like Noriega in Panama,
27:33was a stooge of the CIA.
27:35He worked on their behalf.
27:37He unleashed a cruel war against Iran
27:41on behalf of the United States,
27:43against Ayatollah Khomeini, right?
27:45So, he was their man.
27:47So, they decided, okay, we sacrifice him.
27:49So, they gave him a signal to take Kuwait.
27:54And why did he want to take Kuwait?
27:56Because the war that he had waged against Iran,
28:00on the orders of the United States,
28:03had been financed by Kuwait,
28:05on the orders of the United States.
28:07So, the United States had said to Saddam Hussein,
28:09I want to invade Iran.
28:11And the United States said to Kuwait,
28:13give Saddam the money, right?
28:15And when that war ended,
28:17and a million people died,
28:19the Kuwaitis said to Saddam,
28:21give me the money back.
28:23And Saddam picked up the phone
28:25and said to Washington, what do you mean?
28:27I've done this on your behalf.
28:29All these people have died.
28:31And the Americans said, oh, we don't care.
28:33This is between you,
28:35bilateral problem that you have with Kuwait.
28:37And he stands, you know, Kuwaitis,
28:39a big squeak thing like that, I'll take it.
28:41And the Americans,
28:43through the American ambassador in Kuwait,
28:45signaled to Saddam, on purpose,
28:47provoking him,
28:49they said, the United States
28:51will not have a problem if you take Kuwait.
28:53So, he takes Kuwait.
28:55And then, bang!
28:57This is all established fact.
28:59After the surrender
29:01of Saddam Hussein,
29:03during the first Gulf War,
29:06the American Air Force
29:08was shooting Pershing and Cruise missiles
29:10and all sorts of missiles
29:12into the desert
29:14to get rid of the stock
29:16so they could replenish it.
29:18At some point,
29:20Saddam Hussein gets really annoyed
29:22and says, I'm going to re-denominate
29:24the Iraqi oil in Europe.
29:26And that's when the Americans decided,
29:28okay, we'll take him out.
29:30So, you're right, but there is a longer story
29:32which connects to the question
29:34of American capitalism,
29:36European capitalism,
29:38and how this all interconnects.
29:40The financial crisis
29:42of 2008
29:44in the United States
29:46with all the global implications.
29:48So, what you said is,
29:50roughly, this particular crisis
29:52of 2008
29:54to capitalism
29:56is almost like
29:581991 to the Soviet Union.
30:00Do you make this
30:02comparison in a very broad
30:04philosophical sense
30:06or is it very concrete
30:08that can be noticed
30:101, 2, 3, 4,
30:12there are similarities there?
30:14I'd like to hear your views on that.
30:16Powerful statement.
30:18Both. Because if your
30:20philosophical statement
30:22is not backed by concrete
30:24analysis, then it's not worth anything.
30:26And if the concrete analysis
30:28makes sense, then there has to be a
30:31overarching argument.
30:33Look, capitalism
30:35would have died
30:37a long time ago, in 1929,
30:39if it wasn't for
30:41the Second World War.
30:43The Second World War
30:45essentially saved capitalism
30:47by saving
30:49American capital.
30:51In combination with Roosevelt's
30:53New Deal, essentially what happened was
30:55central planning
30:57saved capitalism.
30:59The war allowed the politics
31:01to coalesce around a central plan.
31:03And then after the war
31:07capitalism was given another
31:09lease of life by extending
31:11the American central plan
31:13in the way that I described
31:15during my lecture in Europe
31:17and in Japan.
31:19And that essentially extended
31:21the life of capitalism
31:23all the way to the 1970s.
31:25That
31:27system died when America
31:29lost its surpluses.
31:31And then capitalism was given another
31:33major boost
31:35by reversing
31:37completely reversing
31:39the surplus
31:41recycling mechanism
31:43that the Americans had created
31:45between 1944 and 1971.
31:47Remember that
31:49between 1944 and 1971
31:51the Americans had a surplus
31:53the money that
31:56they were making from the surplus they were giving
31:58to Europe and Japan
32:00that was what was happening until
32:021971. After that
32:04the Americans had a deficit
32:06which they used to suck into
32:08the United States the surplus
32:10of Germany, of France,
32:12of Japan, and then China.
32:14This is what kept
32:16capitalism alive.
32:18Chinese savings,
32:20Japanese savings,
32:22profits were created
32:24in this country and in Japan
32:26and in Germany
32:28but it was a
32:30kind of symbiosis because
32:32your factories could work
32:34fast and well
32:36because you had demand from the Americans
32:38who didn't have the money.
32:40So they printed the money.
32:42And they gave it to the
32:44German capitalists,
32:46to the Japanese capitalists, to the Italian capitalists,
32:48to the Chinese capitalists.
32:50Who then did what with the money? They took it to Wall Street.
32:52So the recycling gave
32:54capitalism its most
32:56exorbitant, exuberant
32:58dynamic phase
33:00what we call globalization.
33:02It was all globalization because Bretton Woods
33:04was global too.
33:06But this is globalization with financialization
33:08and anarchy.
33:10Complete anarchy. Because it is the bankers
33:12who are doing the recycling
33:14and the governments
33:16do not have the control that they used to
33:18at least the American government
33:21or the German government. You remember
33:23the International Monetary Fund
33:25that was serious discussions they were having
33:27up until 1974.
33:29They would get together in Washington
33:31and decide amongst themselves
33:33exchange rates. They were not living
33:35into the markets. So after that
33:37it was not anarchic but an interesting
33:39recycling mechanism
33:41which was based on a really
33:43non-neoliberal
33:45anti-neoliberal
33:47and anti-capitalist notion.
33:49The whole thing is run on the basis
33:51of the American deficit.
33:53Without the American deficit
33:55global capitalism
33:57would die. This is what I say in this book
33:59which you very kindly brought here.
34:01The global minotaur.
34:03This is what I say. The minotaur is the American
34:05deficit which needs
34:07to be fed by
34:09everybody else to keep
34:11the world capitalist economy
34:13in a kind of unbalanced
34:15equilibrium.
34:172008
34:19was a new 1929.
34:21In 1991
34:23the Soviet Union collapsed
34:25and that simply accelerated
34:27this recycling mechanism
34:29which I call the minotaur.
34:31So 1991 was the end of
34:33Soviet communism
34:35and Eastern European communism.
34:372008
34:39the new 1929
34:41this time I believe
34:43killed capitalism.
34:46Because the American
34:48political system
34:50which gave capitalism
34:52an extended life
34:54during the war, in 1945
34:56in the 1970s
34:58after 2008 I don't believe
35:00they can do it anymore.
35:02I do not believe that capitalism
35:04can be given another new
35:06lease of life by the American
35:08political establishment. You can see
35:10they are dysfunctional. They cannot build
35:12nuclear submarines.
35:14It doesn't work.
35:16It breaks down. You have to
35:18get out and walk.
35:20America has lost its capacity.
35:22The American state has been hollowed out.
35:24They cannot build
35:26bridges. They used to be able to.
35:28Really very well.
35:30So the American state can no longer
35:32manage world capitalism.
35:34And in addition
35:36to that, going more
35:38into the
35:40roots of
35:42the capital
35:44accumulation process
35:46and this is the topic of my last book
35:48which you kindly mentioned, techno-feudalism
35:50totally
35:52spontaneously
35:54completely unplanned
35:56a new form of capital has been born
35:58what lives in here
36:00with the Googles, the Metas
36:02the Apples and so on
36:04you have it too
36:06the only two countries that have it
36:08the United States and China
36:11with Bilibili
36:13with WhatsApp
36:15with Baidu and so on
36:17but in the West
36:19this capital
36:21is completely
36:23without control
36:25without political supervision
36:27and it has a fantastic
36:29capacity
36:31to create new fiefdoms
36:33a new form of feudalism
36:35which is digital feudalism
36:37I call it techno-feudalism
36:39and even though capital has triumphed
36:41capitalism
36:43and that is the main hypothesis of my book
36:45has already been transformed
36:47without us even realizing it
36:49into a form of techno-feudalism
36:51so in that sense, I'm saying that 2008
36:53was to capitalism
36:55that which 1991
36:57was to Soviet communism
36:59its end
37:01I think it's a very
37:03philosophical and also
37:05a down-to-earth approach
37:07to this analysis
37:09now, I'm thinking of this very
37:11issue you mentioned
37:13actually this kind of recycling of
37:15US money
37:17by Germany, Japan
37:19later China
37:21it had to do with the way
37:23the Chinese embraced
37:25globalization
37:27and here I can add a footnote
37:29because at that time I was working
37:31in the Chinese government
37:33having a chance to meet
37:36leaders, actually within Chinese
37:38leadership, they also debated
37:40about this, how to
37:42face with this
37:44globalization
37:46basically at that time, Chinese leader
37:48Deng Xiaoping has a
37:50thinking, more or less like this
37:52we cannot
37:54continue the Soviet model
37:56within
37:58the Soviet
38:00socialist camp, you trade with each other
38:02that will not be internationally
38:04competitive
38:06so basically we have to have relations with
38:08capitalism, with this globalization
38:10pushed forward
38:12by the United States
38:14but he at that time said a famous phrase
38:16in Chinese called the
38:18which literally means
38:22maximize its advantage
38:24and minimize or ward off
38:26its disadvantage
38:28so more specifically
38:30at that time the United States
38:32pushed this
38:34what we call comprehensive
38:36globalization, it's both
38:38economic, political, financial
38:40privatization, democratization
38:42whatever, liberalization
38:44etcetera
38:46so Deng Xiaoping argued that
38:48for economical liberalization
38:50yes
38:52political liberalization, no
38:54but Gorbachev embraced
38:56both and he failed
38:58even for the
39:00economic globalization
39:02we should also adopt the same
39:04approach
39:06a critical approach
39:08in the areas where China has
39:10more confidence
39:12say we have relatively low labor costs
39:14we have relatively other
39:16conditions, so we are
39:18more open, but in
39:20other domains, for instance
39:22the capital
39:24market, we have been very cautious
39:26on that because we're not sure that
39:29it will work
39:31it will never work
39:33so with that approach
39:35China has managed to be
39:37one of the very few countries
39:39on the whole
39:41you see
39:43the winner or partial
39:45winner of this globalization
39:47so even up to today most Chinese
39:49both the
39:51grassroots and top level
39:53leadership still think
39:55globalization is on the whole
39:57positive thing, we are beneficial
39:59from the process
40:01as a result China
40:03has become better
40:05and richer and prosperous than before
40:07yet there is
40:09the downside
40:11it costs this as well
40:13so look at China
40:15today, when you talk
40:17about the 2008 crisis
40:19some people say
40:21in 1989
40:23China
40:25saved socialism
40:27in the year 2008
40:29China saved capitalism
40:31it's correct
40:33so now
40:35again the West is in crisis
40:37the United States is in crisis
40:39we have already
40:41written, many of us
40:43written on this argument
40:45we cannot save the United States again
40:47we will not do that
40:49same with the central government
40:51because US senior officials
40:54came to China
40:56to buy their treasuries
40:58we actually sell more and more
41:00obviously
41:02I'm saying this because we have students here
41:04don't think in terms of
41:06black and white about globalization
41:08this is a good thing or a bad thing
41:10before you go anywhere
41:12near globalization
41:14firstly to define what it is
41:16do you mean
41:18intensified international trade
41:20that's always a good thing
41:22it's always a good thing to trade
41:24to trade more
41:26but that's not what globalization is
41:28globalization the way I understand it
41:30which comes out of the 1970s
41:32is the
41:34total
41:36unhinging
41:38of financial
41:40power
41:42allowing money
41:44to rule the world
41:46that's what globalization was
41:48essentially
41:50power
41:52shifted
41:54if you want to think of the transformation
41:56of feudalism to capitalism
41:58power shifts from landowners
42:00to the owners of factories
42:02to put it bluntly, the owners of capital
42:04from the owners of land
42:06to the owners of capital
42:08that's the great transformation
42:10from feudalism to capitalism
42:12then
42:14with financialization
42:16you have another transition
42:18from the owners of capital to the bankers
42:20the bankers were supposed to be
42:22the servants of capital
42:24but with globalization
42:26they became the masters of the universe
42:28with one press of the button
42:30they could
42:32destroy two countries at once
42:34by taking billions and billions
42:36from one country
42:38from let's say the United States
42:40hollowing out
42:42whole manufacturing areas
42:44destroying the working class there
42:46destroying the money into Korea
42:48right?
42:50and then when the bubble bursts in Korea
42:52they press the same button
42:54and the money leaves Korea
42:56and Korea is destroyed in 1998
42:58that exorbitant power
43:00of
43:02the money men
43:04that's a terrible thing
43:06but we must not conflate that with trading
43:08at this point the China is fortunate
43:10that's why I'm saying that
43:12people say to me
43:14people from the right
43:16from the establishment
43:18in New York and London say
43:20why are you so against globalization
43:22it has lifted so many billions of people
43:24out of poverty
43:26I said it lifted the Chinese out of poverty
43:28because they did not globalize
43:30because of the capital controls
43:32because they didn't listen to you folks
43:34if they had listened to you
43:36if China had listened to the International Monetary Fund
43:38and the World Bank
43:40and you had liberalized your capital markets
43:42you would have been
43:44a desert now
43:46in 1998 you would have been destroyed
43:48right? China would not be what it is today
43:50so look at China
43:52today
43:54when you talk about the 2008 crisis
43:56some people say
43:58in
44:001989
44:02China saved socialism
44:04in the year 2008
44:06China saved capitalism
44:08it's correct
44:10it's correct
44:12so now again
44:14the West is in crisis
44:16the United States is in crisis
44:18we have already written
44:20many of us have written
44:22on this argument
44:24we cannot save the United States again
44:26we will not do that
44:28so my final question is
44:30how if you are to give advice
44:32to the Chinese government
44:34at this particular moment
44:36what advice would you give
44:38in terms of at least
44:40economic relations
44:42financial relations
44:44vis-a-vis the United States
44:46China saved capitalism in 2008
44:48Central Banks
44:50Western and Central Banks and China
44:52simply by boosting your investment
44:54rates so high you create a demand
44:56for their goods
44:58so Germany that lost
45:00the Greek market, the Italian market, the French market
45:02because Europe collapsed
45:04if they were not selling to you folks
45:06if they
45:08were not taking advantage of the
45:10growth here because of
45:12the accelerator multiplier
45:14effect of this boost
45:16in investment here
45:18Germany would have died much much earlier
45:20so it's correct
45:22you cannot save capitalism again
45:24because capitalism has committed suicide
45:26in the West
45:28and intentionally
45:30right
45:32the combination of bankers and big tech
45:34and what I call cloud capital
45:36they're not even interested in saving capitalism
45:38why should you save capitalism
45:40my concern
45:42for the future is two-fold
45:44comes in
45:46two dimensions, one is
45:48war
45:50because the Americans are determined
45:52to pursue
45:54never-ending wars the same way that they invaded
45:56Iraq in 1991
45:58in order to boost aggregate demand
46:00they fear China
46:02and they fear China
46:04because here you have developed
46:06digital capital
46:08cloud capital as I call it
46:10in conjunction with
46:12your finance, I call it cloud finance
46:14you have a cloud finance here
46:16which the Americans don't have
46:18they have the rickety old-fashioned
46:20dollar payment system
46:22which is not digitized because
46:24not because they can't do it technologically
46:26but because Wall Street does not want
46:28to share the profits
46:30with Silicon Valley
46:32so the Americans worry
46:34that your digital
46:36payment superhighway
46:38will undercut
46:40the dollar
46:42payment superhighway
46:44or highway and that
46:46is where the power comes from today
46:48not so much from the military but from the dollar
46:50so they will keep squeezing
46:52China
46:54in order to prevent, they want to
46:56terrorize Indonesians
46:58Malaysians, Africans, Germans
47:00even Chinese
47:02they want to
47:04terrorize everyone
47:06so as not to use the Chinese
47:08digital payment superhighway
47:10that's my view
47:12and they are prepared to go
47:14all the way to nuclear war for that
47:16because you've got to remember
47:18the American establishment are
47:20in the same way that you have all these
47:22gun violence, it's a very violent society
47:24I actually love America
47:26I've lived in America
47:28I think they are very strange people
47:30but most
47:32of them are lovely people
47:34and they
47:36have many human qualities
47:38but the American regime
47:40is violent
47:42deeply violent
47:44have you seen the cruelty
47:46with which they attack their
47:48students on campuses
47:50in the 1960s
47:52the anti-Vietnam war
47:54today
47:56the way they imprison
47:58their own people
48:00half of the Americans live in prisons
48:02it's a violent society
48:04they would
48:06use nuclear weapons against California
48:08to maintain the east coast
48:10global dominance
48:12so that's why I'm
48:14exaggerating a little bit but not much
48:16to make the point that why I'm worried about
48:18nuclear war, that's the one thing I'm worried about
48:20the second thing I'm worried about is
48:24I don't want China to become a new Germany
48:28I saw how Germany
48:30I explained that before
48:32didn't manage the macroeconomic
48:34environment
48:36and kept believing
48:38that it could export its way
48:40out of domestic trouble
48:42because if you
48:44increase your manufacturing
48:46investment
48:48but in a way
48:50where you are making yourself
48:52dependent on exporting
48:54the manufacturing products
48:56then you are
48:58becoming more dependent on the United States deficit
49:00like the German state
49:02and then
49:04either you're going to have to impose austerity
49:06and to cut down and maybe then that will
49:08create social cohesion problems
49:10in China. So I would like to see
49:12a five year plan for
49:14boosting
49:16effectively giving people money
49:18in this country. I would do it
49:20really very simple. You have
49:22the digital renminbi. Give
49:24every Chinese citizen
49:26a digital bank account with your central
49:28bank and put
49:30a sum of money in
49:32everybody's account without any conditions
49:34take it and spend it
49:36to increase the consumption
49:38rate in order
49:40to create domestic demand
49:42so as not to
49:44need, not to trade
49:46but to have net
49:48exports, to have surpluses.
49:50I'm
49:52sure the Chinese authorities are thinking about that
49:54but I
49:56think you need to be more radical in your way of thinking
49:58my idea
50:00of a basic income
50:02sounds radical but you know what? It would
50:04really help
50:06domestically and you know what?
50:08The people of Europe
50:10the people of the United States
50:12who are being
50:14constantly bombarded with anti-Chinese
50:16propaganda. If you did something like that
50:18they would say, hang on a second
50:20they are giving money away to the Chinese people
50:22and they are taking
50:24everything from us. That
50:26will be the most important propaganda coup
50:28by China
50:30while balancing
50:32your national accounts and your macro economy
50:34I'm aware that you are
50:36going to meet
50:38Shanghai's financial
50:40authorities
50:42tomorrow. It's a pity. I'll be aware
50:44in Beijing
50:46because Shanghai has been singled out
50:48as the only
50:50metropolitan city in China
50:52to be a new financial centre
50:54for Asia, for the world
50:56whatever. So this
50:58authority knows everything
51:00and you should tell your advice to them
51:02face to face tomorrow.
51:10And this was another episode
51:12of China Now, a show that opens
51:14a window to the present and future of
51:16the Asian giant. Hope you enjoyed it
51:18see you next time.