התמלול המלא של Harvard's Ken Rogoff Talks US Debt, Fiscal Crisis Risks

00:02:45 Speaker 3: How about populism, not just in the U.S. 00:02:48 Speaker 1: All over the world? Have you been asked to be in a task force? No, I wasn't. Nick, you got the short straw. 00:02:55 Speaker 3: No, I think the world of Kevin Warsh, but I'm just as grateful that I'm not on one of the task forces. 00:03:00 Speaker 1: Oh, that was so smooth, folks. Did you see how Ken Rogoff did that? 00:03:05 Speaker 2: Ken, let's talk seriously. We had Jack Lew on. Bloomberg Money's about retirement, Social Security, and all that. And the former Treasury Secretary said day one after the presidential election, we need a panel, we need to get something done about Social Security. You've got to be a natural selection for that panel. What's the first task to get our entitlement program straightened around? 00:03:28 Speaker 3: Honestly, I think it's going to be very difficult to do until we have a crisis. that convinces voters something has to happen. They're not convinced. Now, some economists are finally coming around to the view that maybe it wasn't the free lunch they said it was, that maybe someday we'll get inflation, financial repression, but it's not the dominant political position. I think if you try to run in 2028, i'm gonna fix social security in any more than a passing silence in the rooms yeah the people's eyes glaze over i think it's going to take that's why my book predict at the end of it predicts you know at some point this will end in a crisis of some sort to catalyze the change which will be painful. 00:04:15 Speaker 2: Okay the rainier's killing my glasses i'm fogging up like Like, no tomorrow. We're going to fog up with higher yields. You've nailed the vector towards higher yields. What 10-year yield or even 30-year bond do you perceive to be that point of crisis for the American public? 00:04:33 Speaker 3: Well, I mean, it's the debt level, the level we're at already is difficult. The crisis comes when a shock happens and you're not resilient. The Iran war was a mini shock, really, compared to what could happen. But over the next five years, it could be a cyber war. It could be some kind of artificial intelligence thing, most likely China and Taiwan. But a war kind of shock, that's the scenario that pushes up interest rates. And that makes it hard to, the Fed can't just cut interest rates if the market's pushing them up. The government can't just print money if the market's pushing them up. And I think in our environment, that's a big risk. 00:05:14 Speaker 2: The charm of This Time is Different, Reinhart and Rogoff, is you combine, you conflate together responsibly public and private investment. So right now, if we conflate together $ 40 trillion plus private this, private that, with Wall Street's new addiction, private equity and private credit, are we doing a This Time is Different path right now? 00:05:34 Speaker 3: Well, look, I mean, of course there's going to be some kind of spectacular collapse in AI at some point, which doesn't mean you should take your money out of AI. Shiller and Greenspan famously predicted the collapse of the stock market when I was at around $ 4, 000. Then it went to $ 8, 000, and. 00:05:53 Speaker 1: They were right. 00:05:54 Speaker 3: Then it went to $ 6, 000. It collapsed, but timing was terrible. And I think that's difficult. 00:05:59 Speaker 1: But the U.S. 00:06:00 Speaker 3: Government needs to take steps. They'll be much smaller and easier steps if you do it sooner. I don't see any signs of that happening. 00:06:09 Speaker 1: You and I grew up under the shadow of Barbara B. Conable. 00:06:11 Speaker 2: He's the one, folks, who told Nixon, here's the door, what's your hurry? There used to be a normal process here of, say, Barbara Conable, house, ways, and means. Where does Congress fit in to the crisis that you see coming? 00:06:25 Speaker 3: Well, you know, at the moment, they're kind of sidelined and paralyzed. But there are many people in Congress on both sides of the aisle who are aware of this. But again, you know, it's hard to catalyze action. By the way, we're talking about the United States. We could go to the UK. We could go to France. Look what happened to Macron. when he tried to raise the retirement age. And the French election is coming up right now. They're going to get murdered. And so it's the same thing all over the world. 00:06:51 Speaker 2: Jason from Cambridge emails in and says, Tom, you trashed me with Act 10. To Ken Rogoff, the question of the afternoon here, Scarlett, is there great inflation at Harvard Economics? 00:07:04 Speaker 3: Well, we have a new policy coming in place to try to deal with it. But, you know, absolutely there was. I will say when I came to Harvard... I learned from complaints from the dean that I was one of the easiest graders. 00:07:18 Speaker 1: I didn't change a thing. 00:07:19 Speaker 3: And then over 20 years, I find out from some of the kids, you're the hardest grader at Harvard. So that tells you. 00:07:26 Speaker 1: I've been told you're brutal. You're ruthless. 00:07:29 Speaker 3: I'm not trying to be. I'm trying to be fair and reasonably generous. 00:07:33 Speaker 1: You're brutal and ruthless, Ken Rogoff. Thank you so much.