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tv   [untitled]    May 27, 2011 5:30pm-6:00pm EDT

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and that's it up our show for more on the stories we covered go to r.t. dot com slash usa we have more analysis on on the topics that you've seen just here and you can check our youtube channel at youtube dot com slash r t america i'm lauren lester all of you on twitter and i will be back with more news shortly. live. childbirth come to moscow with josh ford's digitised radar upgraded an automated guided by gyroscopes propelled by our slew of engines russian motors radio the sun. the future coverage.
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live. today violence is once again flared up live these are the images the world seeing from the streets of canada after live shot for a shelter all day. live. you can.
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follow in the welcome to cross talk i'm peter lavelle as the leaders of the group of eight meet in france more and more question the usefulness of this elite club of countries is it just a talking shop can it really influence the global agenda like it once did and should the g eight be abandoned in favor of the g twenty. can. do cross talk to a group of eight i'm joined by andrew hilton in london he is director and joint founder of the center for the study of financial innovation in istanbul we crossed to paul heinbecker he's a former advisor to canadian prime ministers on foreign policy and now a distinguished fellow at the center for international governance innovation and in toronto we have jeff rubin he's a former chief economist for a north american investment bank journalist and author all right folks gentlemen
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this is cross talk and you can jump in anytime you want and i very much encourage it and i do it and you first in london this looking at some of the other pictures that are coming out of the g eight. festival as i think you could call it in france it looks very very impressive but is it just really just a talking shop do they ever really decided anything and in the year two thousand and eleven is the g eight powerful enough to drive the global agenda a lot of questions at seaside or a couple of days that i think you know if it is only a talking shop talking shops are quite important it's important that these guys should get together and talk informally amongst themselves after all that's how this group actually originated in the first place twenty years ago so i don't think that's a rather that's a relevant itself it has a value but certainly the g. eight has been squeezed on the one hand. important countries in the world these days are the united states and china which is the g two zero the g twenty or perhaps even the g thirty to bring in some of the really important developing
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countries so the g. eight is more symbolic than anything else paul do you agree with that is it's more symbolic than anything else it is in istanbul because it's just symbolic and why waste all the money ok because i work in media everybody has to go to the g eight and another story happens in the world and we get squeezed because we don't have the resources to cover real important stories. well the media is part of the problem. you have you have built up the g eight into some kind of enormous event and it's full of photo ops i'm not saying the politicians aren't also complicit in that but it has got to the point where it couldn't deliver and what it was promising because it was promising too much that was one of the problems and the other problem is the world and changed course you have china india and brazil indonesia turkey career these countries now matter a lot and the g eight just doesn't even have them at the table so the g eight really has two reasons for being now i think perhaps three one is
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it gives the european leaders and the canadian media but especially the european leaders privileged access to us to the u.s. president for a day and a half but they wouldn't otherwise have they don't get that it's much at the g. twenty. it also is an organization where you can still rally the western sort of western willingness to to do things to stump up the money for places like libya or egypt and the last thing is it's a place where these guys can get together and talk to their peers in a more relaxed manner than they can at the g. twenty there is more at stake in the g. twenty and and so the g. eight is less. is less of a challenge for them it's interesting jeff i'm going to you in toronto how do you come out on this just a talking shop and if it is a talking shop well as it is and you point out an important talking shop.
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it may be a talking shop but i think for anything more than it's increasingly dysfunctional any relevant i think organizations like the g eight or the g twenty probably had their zenith of influence after the last recession where of course we saw massive coordinated fiscal policy but none of those governments have the financial wherewithal to ever do that again and moreover many of those governments like europe china and the u.s. are moving in very disparate and contradictory ways so i don't think that we're going to see anything substantive out of it but i think as your line of questioning indicates expectations of these kind of events have fallen dramatically in the last couple of years and if i go to you i mean research in this program it's often called a rich man's club that does not keep its promises do you think that's a fair assessment. well i think that's true on both counts yes i think it's very
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interesting just how low expectations are for this particular meeting when would have thought that given the problems that the european economies face hidden the problems the economic problems which the global economy faces economics would have played a big part but instead it's very much focused on the political issues supporting the arab spring a japanese are talking about you know making a pitch for a trade agreement i agree but the focus is primarily political leaving the bigger economic issues i think the bilateral negotiations between the united states and germany representing the european union on the run and and the g. twenty with a much much broader agenda later in the year i just think that i cannot remember a g seven or g eight meeting with expectations that. well you could use one of them one of the issues is trying to interject it's on purpose of you know they're doing this on purpose they have they've said that the g.
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twenty is their preferred. institution for coordinating international economic policy and they have tried their fortitude to delimit the g. eight to political security kinds of issues so that's why you find i'm talking about i do agree though that i mean the first person who thought the g eight made me may not be necessary anymore was sorry cozy himself the host for this meeting who was expressing doubts last summer whether you know what if the value was but. on the other hand the french have added some new things to be agenda from the internet to the arab spring to climate change in commodities and so on that they're ending up with a very large sort of. very large number of dishes on the table none of which are going to be properly cooked probably just you know it's interesting i mean from what we've heard already in this discussion here it's really agenda light
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it has to be agenda light because no one is going to make any really big decisions it explicitly financial economic without speaking to the chinese first because they count and they count a lot now. well it may be agenda light but the economy is certainly not agenda light i think whether you're talking about china or europe or the us the recovery is facing probably its greatest so that's the challenge is that it has at this point i mean we're already seeing oil prices at honored fifteen dollars a barrel already seeing food prices above last cycles peak we're seeing inflationary fallout from that and rising interest rates so there's no set there's no lack of issues to talk about as far as the economy's agenda is concerned and even though that's not going to make the agenda this week's meetings jeff they really are very interesting how you know i think it's i think it's very interesting is that you know the g eight is meeting to solve the world's problems we'll talk about that if
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that's just out of self-interest but it does it we've been brought up here they're not dealing with their own real problems and when we look at getting out of this deep recession not all these members are on the same page and not by any stretch of the imagination. i think that means that there's going to be some very important discussions taking place in the margins which aren't going really to be reflected in a formal agenda or in the communique afterwards i would imagine that there's going to be tremendous discussion. amongst the europeans and between the europeans and the americans on the sovereign debt crisis in europe there are going to be discussions on the press the managing director of the i.m.f. that probably will be settled over the next couple of days effectively these are important issues which are not really appearing on the agenda but certainly be dominating the margins of the meetings and that probably is where journalists and other people will look for the most important outcome of the meeting i doubt very much if they're really going to commit large sums of money to support the arab
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countries of the middle east and north africa i'd like to think they would but i think they're quite serious differences of opinion there and trying to commit billions of dollars to support tunisia or wherever it is i think is probably a step too far at this stage paul if i can go to you and i'm not going to ask anyone here to be a middle east expert here but i think it's quite interesting this picture of aid for attorneys in egypt and you know a lot of people that are critical of western involvement in the in north africa would say you know you know the money might come but there's going to be all these strings attached and it's going to be the west involving itself in this very complicated and long term transformation i mean is is that it's shows it is the west trying to flex its muscle saying we're going to stay engaged in this region and they may think it's for good reasons but a lot of people in the region don't see it that way. there's a degree of cynicism in what you're saying there and i don't think that i share it what we're seeing in the arab world especially in tunisia and egypt is there is
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a nascent movement toward something that's a lot more in our interest in a lot more in their interest and more particularly and that is a more progressive in a more democratic government society we can't we just don't have the smarts to be able to direct that kind of thing but we do have the capacity to to assist and to back them up as they go ahead. it may be that we're in financial difficulties but we're not going to be in financial difficulties forever and this is an opportunity that is not going to soon come again i think so the idea that somehow the west should keep its nose out of that you know it reminds me a little bit of. when we went into libya in the first place and a lot of people were saying well the arabs don't want you there the arabs who didn't want us there were they were the the now bankrupt leaders of the arab world the autocrats. who are running the place the people in the street the closer you got to the fighting the closer you get to the bullets flying the more they want to
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help so i think that we should be a little bit careful about deprecating what the west can do and indeed what the chinese and the indians could do my only problem with this is that the g. eight is a kind of an event and it can rally support and it can produce some resources but it isn't enough it isn't going to be you know it's going to be much more useful if you can get the chinese and indian and others to breed for this kind of process to get involved in it and because what we're talking about in egypt and in and internees is going to be economic growth and that's going to take investment and that investment some of it has to come from places like india and china rather than from the west ok gentlemen at this point we're going to go to a short break and after that short break we'll continue our discussion on the world's most. the meetest club states are. just slaves. kitchen sisters. and.
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wealthy british scientists. sometimes the tireless. markets finiteness come to. find out what's really happening to the global economy with mike's cause or for a no holds barred look at the global financial headlines tune in to cause a report on r.g.p. .
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slums keep you safe. and. welcome back across the uk i'm peter lavelle three mind you were discussing the relative value of ga. can't say. ok jeff in toronto we probably would have a break he said you want to jump in so just go right ahead. right well let's not also forget what has driven our involvement in the region and that is that when you
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produce thirty percent of world oil supply you tend to catch a lot of attention from the largest world oil consumers and i think some of the skepticism around what's happening in libya is why are we intervening in libya a country that produces one point six million barrels a day and not intervening in other places like yemen and bahrain that doesn't have that kind of oil supply and i guess you know one thing we've got to remember is where we have intervened in the middle east and i say the west stance the bully they increase energy supply typically what's happened is that we've ended up getting less energy supply and any time there's been regime change and it doesn't really matter what the ology of the regime change is whether it's the replacement by the shah by the iranian revolution whether it's deposing saddam hussein the net result has been that that country has produced less oil and even more significantly exported less oil and of course we're inviting us similar kind of
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a similar kind of result here in libya where we've already lost about one point three million barrels a day of production and given how tight the world oil supply is that doesn't seem like anybody including saudi arabia can make up that shortfall well it's interesting it will certainly keep prop prices very high and you if i can go to you i mean again going back to the g. eight here i mean it's interesting the kind of what they want to project to karina we want to help these people you want to do it it's going to be aids it's going to be food security it's all the other security here but if you look at it it's still very much out of self interest out of the self-interest of the member countries if they can agree on those issues so i mean it's if we don't have to look for you know this kind of. soft and furry west you know helping the rest of the world if they're making money off of it they're making very cold calculations about themselves. i
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think that's right so when it comes to the middle east i disagree quite strongly with what i think paul was saying that we went into libya and when we were cheered in the streets we went into libya and we were cheered by about thirty percent of the population in the streets about thirty percent is indifference and thirty percent supports gadhafi we've learned quite a lot of that this is a tribal society and i think obama was absolutely right to be skeptical about the british and french pressure to intervene we are slowly learning when it comes to north africa in the middle east that intervention is very dangerous very difficult words are cheap but it's very difficult to see how intervention military intervention in particular produces a happy outcome i do think however that one thing will come out of the g. eight summit and that is that the e b r d the european bank for reconstruction and development will be given a mandate to expand its lending into the north african region i think there's a sort of consensus on that it will give the b.r.d. something to do it's it's expensively paid bureaucrats in london will finally have
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a job and i think that's not a bad thing what do you think of a plot like that well. i think it's good that the b.r.d. is getting involved and maybe it's for the reasons and you say has been i think it's also good for you know it is a positive outcome where we're looking for a positive outcomes and what we seem to be talking about all the time is negativism and cynicism you know the idea of intervening obviously intervening in the overthrow of duke the iranian president didn't do the democratically elected president one hundred fifty three dollars twenty years of stability and it's brought us the mullahs running iran ever since and that's not a good thing overthrowing saddam hussein was obviously not a good thing in a lot of different ways including the supply of oil but this is a different kind of intervention if i may say so you know get our fees go. we're in
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. this in the suburbs of benghazi he was talking about rivers of blood he was talking about going door to door and showing no mercy. that isn't and if you if you look at it from a canadian perspective you know obviously the quantity of oil makes a difference on the price but we're also selling oil so that's not such a big problem for us but it's costing us a substantial amount of money to participate in the military activity and we're not doing it for our particular economic interests we're doing it specifically because there are a lot of people who are about to be slaughtered if they weren't if he wasn't going to there wasn't an intervention all right gentlemen i want to know that you want to go i want to go back to g. eight ok i still can't understand what humanitarian bombing really means but if i could go to jeff ok let's switch gears guys remember why you're in bombing and bombing means stopping get our face people from killing people all right all right we're not doing a program on libya we're doing it on g eight so if i go to
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a chair for ok. why don't why don't we just scrap the g eight and just go g twenty because that's where you have the other major players there and that's when you can start making global policy that it could be a win win for everybody because the g eight saw about the west and to peripheral countries on it from the west russia and japan ok and why can't it why can't the formats be g twenty where you can actually get things done i know it's bigger number but maybe more efficient for global problems. well it's a better proxy of the global economy because the the locomotives of global economic growth are no longer the united states or western europe or japan they're china and india however i don't think by adding another is zero that you're going to get any more harmony or record i think in fact when you look at china and the united states this is increasingly looking like a zero world it certainly is when it comes to resource consumption and i'm not sure
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that you're going to be able to get any basic agreement on an fundamental economic direction and i guess the biggest issue at the g twenty or the g. eight is is how much longer is the people's bank of china going to be willing to finance an over trillion dollar budget deficit because if they step away from the treasury auction we just will be talking about a sovereign debt crisis in terms of the so-called pigs but we'll be talking about certainly a whole new issue of risk in the us treasury market and that's probably going to remain the one fundamental issue is how long a much longer does does communism's last am going to finance capitalism's well an angel because that's really what's happening right now with the people's bank of china fund during this huge us deficit what do you think about that andrew i mean
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it's interesting is that you know we could go to different options g two you know just the two main countries to get rid of everyone else or go g twenty but eighties isn't sustainable it's just it's turning into just a club and a club that really is just a photo op. well i think i think that's true and that's the point i was making at the beginning i think it is important in some sense to as it were sort of feel the feel the heft of somebody is handshake but that's about all that the g eight is good for but you don't actually have to go to a g. two you have to pick up the telephone in there in some sense the idea that you have these big grand international summits is primitive there are perfectly good as we are demonstrating today video links people can handle bilateral issues bilaterally without putting them into a multilateral forum and without really involving the press and creating all these expectations that the world will change as a result you can have bilateral but bilateral discussions between beijing and
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washington without involving anybody else without creating panic in the market someone hopes that those discussions are actually going on at some of the g. twenty yes the g. twenty is a it's a good shopping x. shopping opportunity for the spouses of the leaders of the countries involved whether it actually very much gets done bush precisely because there are twenty people there who are in fact more than that because there are all sorts of international institutions involved twenty six or twenty seven all of whom need feel the need to grandstand so very little comes out of those meetings as well again really they're an opportunity for photos and for handshakes and not but oh and as i say for shopping expedition and not much else. i disagree with germany in fact progress profoundly without. g. two will not work for the same reasons of the g eight doesn't work it out is that not enough of the major economies would be around the table. if you don't have the indians there if you don't have the europeans there you're leaving out
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a very large amount of the sort of international commerce so i think that the reason that they went up rather than down was because they thought it would work the second thing is to bear in mind it's a g twenty shouldn't be seen as you go. is are now presenting it in the media as something late period g eight heavy g. twenty is really a process a lot of these things that set in train activities that are going to take a long time to do to develop you're not going to get a result of every every communique is not going to be you know sui generous a success in itself these things take time and they take a lot of time and finally the idea that leaders don't need to get together if the leaders don't know each other and this is my only experience or at least they don't learn to trust each other very much they don't learn to take it to understand what each other's issues are. and they begin and it's very easy to demonize people you don't know but when you have them in the room and you're talking to them you can't
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help but listen and at a certain stage you can either decide that they don't know anything and they really are crazy or actually they have a point. and that's the way the international system works it actually works more by face to face contact than it does by you know social media jeff in toronto i don't there's one thing that you do go ahead jump in your head in the modern in order to say it's one thing you have this one thing that you said there which i do agree with and that is that the g. twenty is a process i mean there are no doubt there are several initiatives which are taking place under the g twenty i'm bella which are important and that will produce results over time but but if the g. twenty didn't exist those same initiatives would have been carried out and let's say the financial stability board i ask the powers or process there are lots and lots of other fora within which international initiatives which are complex and technical can take place not just the g twenty all right jeff i'm trying to give you the last word should there be a g eight meeting next year. no i'm not sure whether there should or
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not but i don't think that in any anybody in the g eight economies are going to be looking for next year's g eight meeting to come up with a solution to their problems i think that countries are going to increasingly look within themselves to find their own solutions and that giant global overarching organizations are probably really a remnant of a global economy that's probably ready gentlemen we've all run out of time many thanks to my guests today in london toronto and in istanbul and thanks to our viewers for watching us here on our team see you next time and remember cross hospitals.
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if you are in here broadcasting live from washington d.c. coming up today on the big picture.
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