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tv   Public Affairs Events  CSPAN  December 21, 2016 12:00pm-2:01pm EST

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eotoindiwe on january 20 the
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incoming president joined by the at theth congress inaugural ceremony of we caught up with one of the new members recently. lisapresentative elect blunt. tell us about your background. bei am so excited to representing the state of delaware. i started as a caseworker in a congressional office back in
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1988 and worked my way up doing projects and then we worked for the governor and served as delaware's secretary of labor and also deputy secretary of health and social services and worked for a nonprofit in different parts of the world and it -- and excited to be representing our state as our first woman congressional person and also our first person of color to represent the state of delaware. >> why did you decide to run? >> it was an interesting time in my life. i have done a lot of different things and had been in public service for many years and really wasn't thinking about it at the moment, but through tragic loss of my own. i lost my husband at the age of 52 he ruptured his achilles tendon and blood clots traveled to his heart and lungs and tragically he passed away and that makes you question everything. why am i here? what is my purpose?
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for a whole year i was kind of depressed and questioning and i started looking at other people and seeg that they had gone through different kinds of loss, whether loss of a job or a child to gun violence, and it was actually being in a supermarket, there was a father and three kids in front of me and the father had to put back a bunch of grapes because they were nine dollars and it was like a light bulb went off to me that that is just not right and i started licking to the -- listening to discourse and the negativity i was hearing across the country and i thought that was not right either. toust decided i was going throw my hat in the ring even though i had never run for office before. i thought i could serve and could help and i went up and down the state and talked about jobs and strengthening our economy and bringing people
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together and it resonated. awon a six way primary and four-way general and i/o it to the people of delaware. >> what kind of help and who did you get help from? >> so much help. an organization many people might know about, emily's list is an organization that helps women candidates across the country. it is 3 million men and women who contribute and they were helpful from the binning -- beginning in terms of hiring a team in raising money and how to do this. i had support locally from people up and down my state. fiveirst woman gave dollars and routinely she would give five dollars or $10. everything from organizations to my mom who would make soup for me so that i would have pots of soup. people prayed up and down the
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state and people who had run before and were wise and gave me their wisdom, like congresswoman karen bass. she had come to delaware for an event and she took a couple to me abouttalked being here and the good work that sometimes is not covered and that was inspirational as well. a lot of donors, supporters, family, friends, preachers, everybody helped. >> what do you think your husband would say? >> wow. --etimes when i actually when i actually received the news i had won, i thought of a e.e cummings poem called "i carry your heart in my heart." i think he would say "you did it" in my cheeks get all burned a. i think you would be very proud of not just me, but my state. >> what kind of fight do you
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want to wage here on capitol hill? what kind of work you want to do. ? >> i really ran on a platform of creating an environment that is important and helpful for businesses to strengthen the economy and to focus on everything from job training to investing in our infrastructure and making sure we have equal pay for equal work and some of the issues we talked about on the campaign trail started with jobs in the economy, but it is connected to everything, connected to our criminal justice system and your ability to buy a home and our school system. for me, it is focusing on jobs in the economy and all of the many different facets. >> what are you hearing from your leadership. the house about how to serve -- any advice they are giving you? >> it has been interesting come
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out of the two weeks of orientation, one of the things i have taken to heart most importantly is, no matter what committee you receive or what office you received, you are blessed to be here representing. omeone said "put a bow on it." if jobs is important, no matter what committee i am on, i have to find a way to really make that be effective in doing that. that is probably one of the biggest lessons i've learned in the other thing is that what i love is in these discussions, a lot of people are concerned and into me, these discussions about where to begin as a party, where do we go is a country? this is the time to have those discussions and be open to new possibilities. that is the other message i am hearing is that we have to talk and listen and hear and understand. what happened in the past
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election and where are we going? >> where did you grow up? >> i was born in philadelphia, but grew up in wilmington, delaware. i am 54 years old, almost -- my dad calls it the double nickel, i will be 55 and i have those coat kids. my son is 30 and lives in maryland with his new wife and my daughter lives with me in delaware and has her master's in social work. both of them are good people, conscientious, still have student loans, so student debt is important to me as well. it just grew up in delaware and international relations undergrad and urban affairs and -- urban affairs and public had theor my under -- opportunity to live overseas in places like shanghai and wrote a
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book about women who reinvented themselves and that is kind of a theme for this campaign i had was about reinvention. who are we now and where do we want to go is a country? >> will your children and your mother be there when you are sworn in? >> i hope all of them will be there, but my father actually was city council president in delaware in our major city of wilmington. for him, i think he was extra proud. i think maybe the second time in my life i have seen him cry. he would not acknowledge it, but he cried on my shoulder that night when the word came in. he will hold the bible for me. it was great campaigning for him and enjoying the moment. i think that is what charles -- my husband, more than anything else he told me to be present, be in the moment. even the hard stuff is all for our good. >> what advice has your dad
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given you about public service? grew up in that kind of background. my grandmother was a nurse and the other was a ball bearing leader -- was a leader in a ball bearing plant. i think it has always been about public service. running for office has been really different because i am used to public service. it is a different thing when you are the candidate and my dad, i think he tried to warn me of that. until you experience it, you really do not know it in your debt. i think the advice he gave me i am. stay true to who many times he would give me advice and then pulled back and it "but that is how i did and now you do it how you do it." i am glad he was respectful of my process of how i do things.
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i think he tried to give me the space to be there when i needed him and particularly with charles being gone, charles -- my dad stepped in to be my escort or go to church visits blessed.really i have a sister who ran the obama campaign in delaware in 2008 and worked for senator biden and she was instrumental in the campaign as well. it is a family affair. running for office, this is new for me and i am just really proud to represent delaware. >> representative elect lisa blunt. thank you very much. announcer: this week on c-span, tonight at 8:00 former president dick cheney and leon panetta on the future of the defense department under president-elect donald trump. secretary cheney: i think we
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unfortunately done serious damage to our capabilities to be able to meet those threats. secretary panetta: a new administration is going to have to look at that kind of world and define policy that we need in order to deal with that, but then developed the defense policy to confront that kind of world. announcer: thursday at 8:00 p.m. eastern, a look at the career of vice president-elect pence. apologyve stood without for the sanctity of life, the importance of marriage, and the freedom of religion. [applause] announcer: on friday night at 8:00, farewell speeches interviews to several outgoing senators including harry reid, barbara boxer, kelly ayotte, and dan coats. this week in primetime on c-span. this holiday weekend here are
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our featured programs. on saturday, we take a look at farewell speeches interviews for outgoing members of congress in the white house. mikulskiwith barbara of maryland. speeches for vice president joe biden. at 8:00 p.m. christmas at the white house. join first lady michelle obama as she receives the white house christmas tree, see this year's decorations. make chrisfting ts ho the tghti remo
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her latest book, "finding time the economics of work-life :onflic" was publhed th ar.
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t n wco pfeor peghr s cte. say tt marx is too good
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x is too good"mar to be left to the marxist." that is what he would say. you can see how he took a lot from volume three from capital, das kapital.
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i could go on, but i won't do that. so what i have done for the past 30 years with my colleagues and others is to develop a theory based on some ideas. when i started growth, the model of fashion was the model with only two equations to describe everything. it is very elegant and very helpful, but the purpose of the model was to say without economic progress, you cannot have growth. you cannot rely on capital accumulation to grow forever.
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you run out of steam and cannot have long-run growth. it was a growth model to explain to us that we cannot have long-run growth if we don't have technical progress. the model would not explain where technical progress comes from. say you needed to find something else, but there was no such model. in fact, you would hear about one person, very interesting ideas, but there was no model and empirical analysis. so what we did is take some of his ideas and try to build a model around those ideas and see how we can dialogue between the model and the empiric to learn something about the growth process. so we built the model and it revolves around three ideas. the first idea is that long-run growth is driven by innovation. the second idea is that
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innovations result from entrepreneurial activities that are motivated by the prospect of innovation rents. this tells you that institutions and policies impact on growth. i am in a country where i have expropriation, i will not do innovation, because i know the rents from my innovation will be appropriated. i will not engage in any innovation because i know that all of the rents will be expropriated from the inflation tax. the policies and institutions shape the growth process because they impact the incentives. the second sentence tells you that you can talk about policies and institutions of growth, but there are institutions that are good for innovation and growth and institutions and policies that are bad for innovation and growth.
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the second sentence is creative destruction, new innovation, frontier innovation, they displace all technologies. that is a very important sentence because it means that growth is a conflictual process between the old and the new. you can talk about the political economy of growth and the important thing is that the innovators of yesterday tend to become the entrenching incumbents of today who try to prevent new innovators from coming in. you need to have a system that at the same time rewards innovation, but not to an extent that the innovator will use reward to prevent innovation, and that is the kind of squaring the circle problem with innovation. some countries are better than others at dealing with this dilemma. that is the political academy of growth -- economy of growth. it is entirely based on this. there are countries that deal
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well with it and they call them inclusive and there are countries that don't deal well with it and they call them extractive. that is the introduction. that is the framework we have used. with this framework, we can talk about enigmas of growth. let me go through some enigmas. then i will go into what can europe and u.s. learn from each other on making growth more inclusive. the first enigma is the growth enigma. the first enigma is the middle income trap. i will take a glass of water. myself that i dehydrate myself which is very bad because i went to harvard, first, middlee income trap looks like mit, which is not fair. ok.
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so, they are our friend and competitors. you want to understand. this is the per capita gdp of argentina compared to the u.s. between 1870hat and 1930, argentina was 0.4% of the u.s., so growing as fast as u.s., but after 1930, they grow less than the u.s. do you see what i mean? that startedntry doing well, then they stopped doing that well. china is now experiencing the same problem. they say we grew faster through catching up and now we don't know if we can grow through innovating so much. they are obsessed by the middle income trap. that is their obsession. they are to make sure adopting the argentine us an area -- argentina scenario.
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the way to explain it with our framework is to say you have two ways to generate productivity growth. one is to catch up with the leading edge. you catch up with the technology front tier and the other is to innovate yourself. if i was a country like china was in the late 1970's, you want to catch up. that is the main source of growth. if you are already an advanced country, you need to innovate on to yourself. it turns out that what makes you catch up are different policies than those that induce innovating at the frontier. if you are in the business of catching up, it is no big deal to have limited competition on the product markets. you are a big firm and they catch up. it is no big deal to not have much labor market flexibility. you can have the same people working in the same firms forever. it is no big deal to have graduate schools, because you need primary, secondary,
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undergraduate. you need to have banks and government subsidies. when you want to do frontier innovation, it is important to have competition. you need a flexible labor market because you need to be able to hire quickly and you need to have good graduate schools. you see what i mean? so an equity venture capital, -- financing as also important, venture capital, private equity to finance various undertakings. the policies are not the same for developed nations as they are for frontier nations. if you want to advance growth in advanced countries, you need to invest in education and have flexible labor markets. this represents the effect on growth of a higher entry rate as a measure of competition on u.k.
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firms. the blue firms are the firms of the frontier. on them, more competition induces them to innovate to escape the competition from foreign entrants. when you are a red firm, you are lagging in the sector, you are already discouraged by the leaders, and more competition from foreigners will discourage you more. we can see right away that competition is to innovation for -- enhance innovation for those already doing very well, that is to discourage innovation from those who are behind. the more advanced the country is, the more you have blue firms compared to red firms. the more advanced a country is, the more growth enhancing it needs to have to liberalize the product market and have more liberalized competition. that is an example, but it is true also for the labor market and higher education. whereas, if you are an emerging market economy, what you want is essentially like china did.
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their technology transfers and they forced relocated factory production and improved management practices. bloom, that showsck management for various countries. in the u.s. they have very good management skills. , latinrmany, sweden america, and you see central europe. you see south america and then you see africa at the bottom. so management practices -- the idea is that when you are the catching up country, you can improve through improving your management practice. that is the margin on which we can improve. explaining it in a very simple way, you have countries that
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started to grow because they were not catching up. the formula, they should have switched to policies that favor innovation, but they did not because you have compound interests. in korea we have the big firms that grew during the catching up until of -- the catching up period -- these conglomerates grew very big when they were during the catching up period, and they somehow slow down the transition, so that is something that you would explain to middle income, japanese high income. that may explain the transition from innovation days to innovation days. france had the same kind of problem. we were very good and we were catching up.
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france ise problem of to have institutions of a more innovation-based economy. and now we are making that transition. the second and enigma is that there is a debate on secular stagnation. so here comes robert gordon, who i respect. say -- you can hear me from their. you see the product? the -- thereave of you have the second wave of productivity and chemistry. and then you have the wave of the economics and communication. and each of these waves got
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smaller. innovations, which we called the general public -- it is like fruit on a tree. you climb higher to get other fruit and the fruits you get are not so good. and you believe that innovation are like fruits. the best ones are the ones you get first, and then they get worse and worse. 1820, with the english revolution, and now it is almost finished. it will be no more. i disagree with this view. for several reasons. that the revolution not only transferred technology to goods and services. it also channel technology into ideas. ,ow when i work on a paper
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straight from the u.s. -- we can collaborate much better than we could before. the technology to produce ideas has never been as good as it is today. the runnd thing is that to innovation has never been as big as it is now. -- sove the whole world energies, wele, in -- we would cannot like to see the day where maybe lever do 3-d thing of a and then a new one or whatever. i do not know if that is the way it will happen. it would be very big resolutions.
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-- big revolutions. so how can we believe? the newyou predict when innovation will happen? but you see, you can pick when it will happen. you know exactly when it will happen. the second objection is missing growth -- i am doing some work , and what we do do not know how to measure growth. why don't we know how to measure growth? the problem is that we know the value in dollars. we know good in dollars and you can compare dollars to dollars. but the problem is there is inflation, and the real growth. we do not know how much is in
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inflation at how much is in real growth. it is worth much more than yesterday. we do not know how much of it was due to inflation and how much of it was real. if it is the same good yesterday and today, we know it is inflation. if it is good but slightly improved, we know by how much we improved. ,ut when you have a new product replacing an old product, you do not know. and what do it does, most of the growthou impute the brought about by the real good. you replace it with existing goods. in europe they conduct extrapolation. whether one or the other, you existing touse the infer what the new would bring to the old. you see what i mean? missingof that, you are
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one percentage point of productivity growth. you see what i mean? productivity growth is 1.5 in the u.s.. it is truly 2.5. i do not call that stagnation. the finance minister said that 0% was good news in france. but 2.5% is great news, i believe. i would not call that stagnation. that is my second argument. there is a third argument. --ope, we have the advantage the rulebook is that we are behind. many countries in europe are considered together. look at sweden. -- growth was growing at
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0.7%. after the results they did in ,1990's, sweden with japan, you can see that growth is going down. you see that? ok? other countries -- the netherlands, there are big reforms, in 1983, in the early early 1980's. by reforming -- and what do you mean by reforms? by doing structural reform, you can increase growth. the thing with sweden is that they did it while preserving the social model. you have growth -- in sweden you have to do that. education is totally free and you have market policy, and
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poverty rates are very low. and it has not gone down in sweden. mobility,ucing social with greater access to public services. that is iconoclastic growth, you see? my that -- that is my second enigma. it shows thema -- evolution of the shared income brought on by models in the u.s. what you see is that since the early 1980's, it has gone up. it has been rising sharply. there we are going to agree.
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how do you explain that? out isng i want to point this figure. this figure is showing the share of income -- again i show the at is the share of income the top of growth. you see the acceleration in the increase in the share of income. -- you see that at the same time. course no proof of prosperity. i just show that the two curves move together. reachedt work, we have -- we have done studies in a bigd, in london,
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predictor of the nobel prize. knows what else can am it -- knows what econometrics is all about. we should expect a causality from innovation to income inequality. -- is it that innovation when you make innovation, you make friends. those friends take you to the top. individual inventor -- when do you innovate? are very likely to move to the top income bracket. that is knows a prize. -- that is no surprise. skype did not exist 20 years ago. the face-off of income inequality. i have colleagues and friends innovation does
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not exist. that the only source of income is because you are -- you have the hotel and monopoly and you become rich. but that is not true. why is innovation from other sources of income inequality. income innovation generates growth. that is what we can show, and that is what we do in this paper. -- you that innovation show a causal link between innovation and income inequality. i told you that the new replaces the old. innovation, it enhances social mobility. it is good for productivity. innovation does not increase income inequality. various stages of the
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u.s. over the past 30 years, and we look at how inequality shows income in that state, measured by the total -- the first thing we showed is that here i have -- different curves, maybe there and then there, this is on that scale. when you areth, here, you have low innovation. when you are here, you have a high innovation flow. that is good innovation using ideas. you show that the more innovative you are, the higher the scale of income.
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and -- onnovativeness the other hand, the gray curve -- the blue band shows inequality in income, which shows how far you are from the equation. you see that there is no expectation of innovation. so it is a very good thing because it is true that innovation -- it does not increase inequality. they have done that on historical data. they found the same thing in a trend. it is a very robust finding. so that is the thing. now here in social mobility, i -- in social mobility, which i measure, we start to reach the income of the children, is not correlated with income of the parents.
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so i measure this by the probability that the size -- you have other measures of social mobility, and i do that using -- they look at social mobility across zones. zone, that the commuting while also more innovative, also show mobility. new people, not by old people that have been around for a long time. callee, that is what i carlos slim. in mexico, the richest man is carlos slim. know, they get i -- i was married with a mexican. whenever -- that is not the reason why.
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i promise you. know, that is the source of income. ofh, you become the head lightly regulated but not so regulated. that is the way to make money, ok? but carlos slim is not the same thing. at lobbying and the effect of lobbying on the various measures of the equation. lobbying reduces excess --ductivity growth because also we showed that lobbying increases income inequality. it increases inequality -- you have two sources of soft income. borrowing on the one hand. they shut off the other hand. effect not have the same
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on social mobility and on the equation. that system should not read those the same way. that is the difference. slim'sr world, carlos position does not exist. taxation, itnk of does not exist. they did a study in the early 1990's. , it remained is where they said in order to the innovation of education and everything. it became more inclusive of innovation. that is why it is a very positive thing to show. i come to the conclusion stash i can see, philippe, you seem to be worried.
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you did it in a very subtle way. [applause] -- [laughter] inclusive growth, what can the u.s. and europe learn from each other? first, what can europe learn from the u.s.? it is true that the europe we know, the european economy is less resilient than the u.s. following the crisis, the u.s. recovered growth, whereas europe, none. that europehy is it has not recovered growth? the first type of reason was .iven by my friend he said it is true the sequence of policies following the crisis in the u.s. was not great. what they did in europe -- what they did in the u.s. -- at the same time, they did it in a way
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with accommodating monetary policy, and they did not go back on the budget deficit. that went into a bigger recession. they invited a bigger recession. see what i mean? , theyater on they said had a project reducing deficit. in europe, the sequencing was very different. they did it right away with the banking problem. no, wery quickly said, have to deal with the budget deficit. 2011ey imposed already in the very tough budgetary rules, which caused sarkozy and friends to reach -- to increase taxes. it was already started with sarkozy. a knife to his
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throat and said you had to do it. the loanr with problem, with the sets of the banks -- going to europe for exactly the observation in the u.s. we will get back to that. also there are other reasons. more fixable labor on the market in france. proactivehe more microeconomic policy. .urope came later draghi came to us later. -- it is amuch more much weaker economy. we lack both. we do not have stable markets in europe, and we do not have the fiscal and monetary policy that you have in the u.s.
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but i am doing work now, threeng that the least, -- that on the other hand, it comes out and that is the draghi --a very much spoke in this way. with growth you have the monetary policy lower. you do not want to be reducing in rates. sector,wth in a various than are moreger liberal. frenchwhat we called in the low interest rate, the low euro, and we shall have grown very fast and we did not grow. it is very weak markets.
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in that respect, he is right. maybe other people are right. the collective policy in europe, and more investment in infrastructure, or whatever. you have both in the u.s., much more than you have in europe. it is interesting to understand, i think it is a program of trust. the germans do not trust the french because the french so far have not been any reasonable response. you remain very tough on macroeconomic policy. we shall have new growth. could we do that?
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that is why i say we can learn from the u.s. the trend is good. do not go against nafta. do not try to reduce trade because we know that single markets are good for innovation. i have done work for 10 years. withw the enormous effect the brexit thing. growth effects of the single market in the u.k. or for any european economy. trade creates a bigger market for innovation. but also trade increases competition, and that forces innovation. for that reason, trade is good for innovation led groups. theot try to break up mutual agreements against trade because trade is good for
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growth. do not throw the baby with the bathwater, ok? have the growth, but then deal with inequality that it creates, and have a system to deal with that. do not renounce the growth and trade just because you have more inequality. manage the inequality. we know to become more inclusive unique educational. who will vote with mrs. le pen. i hope she won't win, eh? it is very important. thatshould know in france health, you should not only reimburse for operations -- bronchitis,ou have your productivity goes down a lot.
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there are a whole range of things that make you much less productive. investing in capital as much as you invest in education. the very important thing is security of the labor market. other countries as well have understood that if you say to someone who becomes unemployed, you need a good training system and we will help you find a new job, not only does it create a good safety net, but people will manage the creative destruction much better of becoming unemployed. it also promotes competition. it is much good for economists because there is growth. we know that people can retrain into a new job.
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i want to do just two things here. we welcome social mobility. they look at social mobility , and on the.s. horizontal axis you have schooling. on the vertical axis you have probability. quintile -- we see that more education, better -- what is most interesting is this one, which shows on the vertical axis here differencese between the side of the region. i have job creation and job destruction. -- againeasure of
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using the safety data across the income zones. where you have more market turnover, you'll have more social mobility. we know that the engines of innovation-based growth is education. welcomeys also moved to mobility. you see what i mean? with people findhelping a job. there is hope to have more inclusive growth. that everybody can then feel part of the process and nobody is left out. then you can reconcile that people will not be afraid of globalization. they will not be afraid of categorization and they will go
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into the 21st century because they know that they are not left out. backlash against populism. europe should emulate the u.s.. we must work in national policy. the -- second,at join europe in making growth more inclusive. to say it isa way innovation. do not discourage innovation, but may growth more inclusive. -- weish, in the u.s. only 200 years ago in 1835, his book on democratics and america -- i cannot help hearing that man may reach a point where they look on every new theory as a venture, on any new innovation
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as the starter some trouble. the startial event as of revolution. and they refused to move the start for fear of being carried off their feet. the lessons in the u.s. -- the lessons that europe and the u.s. contribute is that we show the way toward the more inclusive and sustainable growth. thank you very much. [applause] >> ok. ippe, for anhil engaging discussion. i will not even attempt to be as witty or wave my hands around as much as you did.
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abi will because it was inspired and fantastic, so thank you. i've been trying to get out of my dour mood for 6-8 weeks now, and i think a lot of my talk today reflects that. my sense is that what we are seeing in the united states is not a country or a population in that enthralled with the creative destructive process because too many people feel they are being left behind, and their communities are part of what is being destroyed. not to start off on a downer, but i think a lot of that is -- as i was listening, i realized i remarks are moving in slightly -- in quite a different direction. there is one statistic that i have come to time and time again since the election that is sticking with me. i think a lot of us should be thinking about this. which is that hillary clinton


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