 Good afternoon, good evening. I'm Romesh Ratnazar from Bloomberg Business Week. And it's a privilege to be moderating this distinguished panel. We have the slight misfortune of having to cover the entire world in an hour. And we have the great misfortune of being the last panel before cocktails. So I'm sure everyone's getting a little techy. We'll try to move this quickly and make it as lively as possible. But I also certainly want everyone here to participate if they would like. So we'll leave plenty of time for questions at the end. I think there are a lot of issues and a lot of people here who would like to comment on some of the things we're going to talk about. So I'm not going to introduce formally the panelists here, but I want to make a special welcome to Ann Marie Slaughter. And since you're here, Ann Marie, and we have the benefit of calling on your expertise, I figured we should just start with the most pressing foreign policy issue facing the United States today. And that is what to do in Syria. I think I speak for a lot of people in this room. I think a lot of Americans, certainly many members of the administration, when I say that obviously this situation is deeply alarming, gets more alarming every day. But at the same time, I and I think a lot of people here are deeply conflicted about whether the United States should get involved in a situation that really seems to be degenerating every day. So I'm just wondering if you could tell us, in your view, short of military action, and it could come to that, what are the options that are available to the United States at this stage? Or have we reached a point where, should we intervene, we would only be making things worse and not better? So now I'm going to pick up on the last panel where Maya was. I'm not optimistic. The first thing to say is there are no good choices. There are simply no good choices here. This is a disaster. It is a horrific humanitarian and strategic disaster that has gotten steadily worse and is going to get much worse yet. And for it's been two plus years, it started as a political opposition movement that really was soon led, but more against a dictatorship than sectarian. It has been Assad's desire from the beginning to make it a sectarian war, and he succeeded. And so that's the first thing to say. And we have said from the beginning, well, we couldn't arm anybody because we couldn't figure out whom to arm. And there were lots of people who we didn't want to arm. And that has become certainly a self-fulfilling prophecy. It has gotten worse and worse and worse. So I guess the way I look at it, at this point, if you don't do anything, and if I'm a betting person, I still have to bet that we won't, notwithstanding the fact that I think that's completely wrong headed. But if I'm just betting, I don't think this president wants to do anything, and I don't see things that are really going to change his mind other than Assad using massive chemical weapons. And already, Obama basically said, you can do it as long as you don't do it systematically. I mean, that's what he said. His first was a red line, and then when he came back, he said, no systematic use of chemical weapons. And what that means is it's OK. I mean, I'm not saying Obama's endorsing it. I don't think that. But he's saying we're not going to act unless it's really big. So I don't think we're going to act. But that means we have to look at the prospect that we've got 80,000 dead now. Could be 100. Could be 200. You've got 1.5 to 2 million people outside the country. That will simply continue. And then you start looking at, well, OK, as the country disintegrates completely, as Assad and his and the Al-Awites move to an Al-Awite mini-state on the Lebanese border, then you see Syrian Kurds looking at joining a Kurdish state across the border in Iraq and Turkey. You see tremendous continuing destabilization in Iraq as the Sunnis who are fighting in Syria are also across the border fighting in Iraq. And destabilization of Jordan simply and Lebanon already, but Jordan simply by version of the number of refugees. So if we're prepared to live with that, we shouldn't do anything. Because it could well be a couple more years. There are people who say and don't advocate, but say pretty openly, what's really going to happen here is the redrawing of the colonial borders. That means there won't be a Syria or a Lebanon or an Iraq, as we know them now, that the colonial borders, the Sykes-Picot Treaty, those are actually coming undone. A very prominent foreign policy commentator just said recently, that's the phase of history we're in. Well, if that's true, that looks like the 30 years war in the Middle East. I am assuming it won't be 30 years, but that's what happened in Europe until you got finally states that were defensible. I don't think we can stand for that. I think that means we are going to have to intervene, and then we have to intervene militarily, because no. I don't see anything else that you can do. I mean, you can try to arm the people who are still relatively secular and focused on a pluralist Syria. I don't think at this point it's enough that they will win it, and you're seeing very clearly the Russians and the Iranians digging on the other side. So it seems to me if we're serious about doing something, I think we have to do something military that doesn't mean boots on the ground. It probably does mean taking out his air force with cruise missiles and our planes and possibly setting up some kind of no-fly zone. But I would start with simply saying, look, we're going to make it a lot harder for you to kill people, at least from the air. And I would only do that, though. And I think we could get this support if we get the support of the region. I mean, it sounds as if what in a way what we're saying is that the longer we stay out, the more likely it is eventually we're going to have to get in. Is that sort of the kind of diabolical choice we're facing at this point? Well, no, that's the choice we're facing if you believe, as I do, that we simply can't afford to have Syria come apart completely and have that part of the Middle East in open conflict across multiple countries over a period of years. I'm not certain that the president's making that calculation. And I think the president may be making the calculation that as it gets worse, as you said, it's more reason for us to stay out. And no matter what, it gets harder. The costs of intervening get higher and higher, so we're just going to stay out. So I don't think we have to. I think we have to only if you make the strategic calculation and the moral calculation the way I make it. If it comes to pass, let's say hypothetically, that the United States does get more involved in a deeper way and more aggressive way, and possibly involving military action in Syria. How, and I think this is something that we probably, policymakers are going to be thinking about going forward. How do we limit? Is there a way we can limit our involvement? Or is it the case that once you get involved, there is no way to sort of wall off your engagement? And is there a risk, if the United States does get involved here, that this will essentially overshadow everything else, that all of the foreign policy priorities the administration might have in the second term essentially get pushed aside because the bureaucracy, the political energy is all focused on managing Syria? Well, so let's just start with what the right precedent here is. There are plenty of examples where it hasn't spilled over. Iraq and Afghanistan neither has a bearing on what we were talking about. In both cases, we have massive ground troop invasions where we destroy the government and then are in charge of whatever happens afterwards. No one is talking about that here. Absolutely not. So the precedent seemed to me to be much closer. Kosovo is probably the best one. Libya, no fly zone over Iraq, East Timor, any one of the places where we have said we are going in for a combined humanitarian strategic purpose but with a limited use of power, we've been able to walk out. If we decided to take out his, again, with the approval of and the participation of people in the region to knock out his air force, I don't see why that commits us to then being in Syria for the foreseeable future. What it might do, however, is force the people in Syria to change their calculations about whether or not they're going to fight to the death or it's worth trying to broker some kind of deal. Not that I'm all that optimistic, but at least I think you have to try. So I don't, I think Syria is going to overshadow everything that this president wants to do, whether or not we're in and the longer it goes, the worse it's going to get. I just don't think the argument about how we're going to be meshed in Syria the way we were in Iraq has any standing or any basis in the reality of what people are actually recommending we do. Last question on this, because I think we do want to talk about other things, but since we are talking about the United States and the world going forward, what do we do about the next Syria? I mean, what lessons do you think policymakers can draw from this tragedy that we're witnessing and do we have any kind of way in which we can intervene in sort of a preventative way to stop the next Syria from degenerating to the point where it is today? Well, I actually think the lesson, Libya is not in great shape by any means, but I still would put to you that Libya is in far better shape than it would have been had we not intervened. I mean, if Gaddafi had in fact gone into Benghazi and wiped out as many people as he could, the civil war would have continued now. I think Libya is an example of responsibility to protect that worked. There are things we could have done better in terms of what we did when we were in and how much we did beforehand. I don't see why we've run so far away from the responsibility to protect now. In fact, the Russians said, well, you know, you guys cheated us. Everybody who was there in the UN when the Russians voted for the Libyan intervention says they knew exactly what was gonna happen. I mean, Susan Rice says, I laid out everything. The British people, the British representatives say the same thing. And yet we've backed away from that when in fact, the only way to get to a situation where you can actually intervene early enough to make a difference with lower cost is to strengthen the norm that when a government starts masquerading its own people at scale, you can intervene and indeed you really, you have the legal right to intervene and that it is not only the right but the smart thing to do. So we have actually seen that norm strengthened remarkably by the standards of international lawyers. I mean, it was passed in 2005. Normally these things don't get used for decades, but we seem to have actually pulled back in a way that I think is weakening our case going forward. Let's switch gears a little bit because I do think these kinds of panels on foreign policy often just become panels about crises and conflicts. And I think we wanna talk about some of the opportunities that the United States has going forward as we look toward 2020 and beyond. And Steve, you've written extensively and as well as anyone I know about energy and how the energy boom in the United States is changing and has the potential to change our relationships with a whole host of actors abroad and in a lot of ways change our geopolitical calculations. Can you talk about how going forward the domestic energy boom is going to change and reshape our foreign policy choices? Sure. The first thing I wanna do is just broaden that out a bit. The way the narrative goes usually when we hear it here in the United States, it's very US focused. The boom is going on all around the world. So the oil and gas boom, North America, South America, Africa, East Mediterranean, Kurdistan, Australia. And so all of, well, let me start over by saying in terms of framing the geopolitics that we look at over the last five years or so, we have tended to focus on soft and fuzzy things, the social media, what impact Twitter or Facebook or whatever is having on events. And I think what we've discovered is that there are a lot of hard things, hard rocks in the world and what are they? Well, one of them is Assad. He's not going to flip like Mubarak. Iran, 2009 was a very big year. That probably started this thinking with the green movement and Twitter and its impact on the election then. But it didn't overturn Iran either. And the other hard thing that hasn't changed, we thought that clean tech, biofuels, algae, solar, wind, batteries were going to revolutionize the world change, economies and so on. And what we've discovered is that it's a lot harder to move the needle there. And the hard thing is oil. The hard thing that exists in the superstructure, immovable is that there is a lot of oil in the world and gas and now a lot of it is being drilled. So that being the case, what's the impact of that? I'll run through some of the stuff that we're seeing right now, but just to fast forward and just give the ending first, there are a lot of good, a lot of positive potential impacts from this oil and natural gas boom. So the IEA a few days ago issued a report, it's medium term report so it goes until 2020. Next year the big thing that's caused the world a lot of trouble and sent oil prices through the roof is that there's no surplus on the market. So there's a very, very tight balance between what, how much oil is produced and how much oil is demanded. And what happens then is that oil traders who bet like in a casino, they bet on the next thing. There's no oil, there's no spare oil. They bet, what if Saudi Arabia has a revolution? What if there's another hurricane, Katrina? What if a bunch of Somalis sees a bunch of oil tankers off the East Coast of Africa and suddenly there's a shortage of oil on the market and so on and then they bet, they trade oil prices up and that's why we've had oil prices above $100 a barrel for two years running and why they went up to $150 a barrel in 2008. IEA has forecast that next year there'll be seven million barrels a day of surplus oil. That's, so the world consumes 90 million barrels. That's a huge surplus. That if it is correct and IEA is a conservative body, oil prices starting next year and running at least until 2020, this forecast is until 2020 are going to crater. Oil prices will go, you know, we can guess, right? Below $80 a barrel, gasoline prices in the United States will go down with them. Look at who relies, just there's a host of countries that have been very powerful for three or four decades that rely on oil prices being, you know, the balance between what is the price of oil and how much can they pump? For OPEC countries, the break-even point since the Arab Spring, and they've increased their spending in order to make social payments so a number of them don't have the same uprisings that Egypt did and that Tunisia did, $99. The average price of $99 a barrel, Russia needs 117, Iran needs 117 to break-even to make the payment. So if the price goes down to 80 average and stays there, the key point is it sustained there, there's suddenly cracks in the edifice for those nations. The geopolitics changed, the ability for Saudi Arabia to pull its weight around the globe, for Venezuela to have weight to push around in Latin America, for Iran to be able to defy the world, that changed. And Russia, Russia is a big example because it depends on gas and oil. So it's caught between a rock and a hard place. Europe's appetite for gas is dropping, it's demanding lower natural gas prices. US gas is coming on the Obama administration today, approved another export facility for US LNG. US LNG is about to pour onto the global market. That will send prices lower. So Russia's break-even points Putin's ability to support his state, his ability to go around the world and defy the UN Security Council to send his ships. So he's had ships for several months in Syria, off the Syrian shore, will be less. And the other part of his equation is that China is holding back. China, if he can't sell to Europe, he can sell to China. China's been holding back for six years, waiting for this day, it won't agree. China won't agree to his price. He's gonna have to agree to a lower price. Let me just close out by talking about China. What is China's rock? What is the immovable thing in China's world that means that it's gonna have to move? Pollution. So those days in January, in which you could see this far in front of your face and Chinese people were in the streets and wealth, when people gain wealth, they gain aspiration and expectation. The calculus in China, the Chinese Communist Party has always been the Chinese people will accept pollution if they have jobs. That calculus is changing now, right? The Chinese people also want to live. They want to live better lives. They want their children not to die young. They want their children not to die at all, right? So there's a push to have cleaner air and that means that this appetite that's built into our models, economic growth models, the CO2 models, climate change models of what's going to happen over the next two or three decades based on Chinese consumption of oil and gas may be very different. Chinese may find a way to burn a lot less fossil fuels. So just to put this in the context of sort of our strategic choices. I mean, one of the hopes was, particularly after September 11th was the idea that if the United States could attain energy independence and essentially wean itself off of foreign oil, we could sort of insulate ourselves from all of the mess of problems that we've had to deal with in the Middle East. Do you think that that is realistic? Certainly doesn't seem that that's come to pass at this point, but do you think by 2020 if we're sitting here on this stage we're still gonna be obsessing and talking about and I'm gonna be asking Ann Marie five questions about how to intervene in some conflict in the Middle East or do you think that we will have essentially broken the fever because of these changes in the energy markets? All right, so in our house we have bananas in the kitchen. We always have bananas in the kitchen. So I have a question for you. Should we be banana independent? We import all these bananas. I don't think so. So this is a mantra, it's an empty mantra of, it's a yearning that we have had since the real rise of OPEC going back to 1973 where we lost control of our own economy, of our own future and I felt that and desiring desperately to have that back and all of that has been wrapped up in this energy independence goal. So it's not a, there are good reasons to be able to drill a lot of oil, drill a lot of gas, be able to sell that and so on, but it's not because you wanna be energy independent. It's reasons of balance of payments. There are reasons for having cheap feedstock for manufacturing base for changing geopolitics, for not being in bed, not having to be in bed with OPEC for example, but we can still buy from OPEC, we can still buy from Nigeria and Venezuela and not hurt ourselves at all. Can I add one thing? Just the other geopolitical consequence which you may have touched on, but with liquid natural gas rather than pipeline, you're also really decoupling Russia and Europe, right? In other words, when Russia tries to put the squeeze on Ukraine, at least from what I gather from people in the industry, increasingly France will be able to sell whatever LNG it has to Ukraine so that it doesn't actually have to count on pipelines, which makes a huge difference in terms of the geopolitics of Europe and Russia. Emily, I guess we should talk about what Steve referred to as the warm and fuzzy things like the internet and the social media, which I think in your view are anything but insignificant. Again, this is another area in which there are opportunities for the United States in promoting our values and our interests if we can figure out the right ways in which we can harness these technologies. I mean, based on the research you've done both inside and outside government, what do we know now? I mean, what are the kind of things that we've learned about the way in which the internet and social media and mobile communications can affect democratic change and what are the ways in which we've run up against some of the limits of what those technologies can do? Okay, so we're focusing on democratic change specifically. I think that sometimes people phrase the question in slightly the wrong way. So there's been a lot of talk over the past few years. For a while, everyone was really excited about the potential for Twitter and Facebook to cause revolutions in various parts of the world. And I think now we're in a period where we're experiencing the backlash. People are really disappointed. And they're saying, well, it doesn't really work. It doesn't create revolution. People look at China and they say, well, China has all these hundreds of millions of people on the internet. Why isn't there a revolution there? And I think the most simple way to explain this, and this is obviously a very long conversation, but when people ask me about this, I usually quote Lenin, which I don't usually do, but I will in this case, who said, and this was actually quite right, that for a revolution, you need a revolutionary situation. And so I think that the mistake sometimes people make is talking about social media as if it's this kind of independent phenomenon. Like, well, social media caused revolution, but social media doesn't really do anything independently. It just complements the current reality. So I think, and we saw this in Egypt as well, social media didn't cause anything in Egypt. There was a moment that it was ripe for revolution and what social media does do is it lays the groundwork and it creates the networks and makes things happen faster and one could say more effectively, but it doesn't cause anything. So I think what we're seeing in countries like China and like Russia, and Russia's another example where in 2011, there was all of a sudden after years of apathy, there were tens of thousands of Russians on the street and social media played a pivotal role in organizing those protests. However, Russia has had basically a free internet for years. So why didn't that happen years earlier? And the reason was people weren't at that point. So once people got to that point, and the point was everyone was very frustrated with election fraud and once they were ready and they were indignant enough to actually get out of their houses in protest, then social media came in. So I think sometimes there's just confusion a little bit about cause and effect. How, I mean, based on, again, the work you've done when you worked at the State Department and the work you're doing now, can you tell us a little bit about some of the best ideas out there about how the United States, how practitioners of foreign policy can harness and employ these technologies in a way that promotes our interests? Well, Anne-Marie can also speak to this very effectively, but I will just offer a few thoughts on that. I think one of the greatest things that Secretary Clinton did, and I had the honor of working for Anne-Marie during that time, it was a really amazing time because Secretary Clinton really put internet freedom on the agenda in a way that no other Secretary of State had done before and she did that in very many different ways, but most obviously by making two major speeches about the importance of internet freedom. So that alone kind of held the US to a really high standard. You know, it wasn't, we're not perfect on this at all, but it kind of made the world look at us and say, well, you're telling us all about how important internet freedom is. Every time the US seemed to in some way be erring on that front, everybody kind of pounced on the US and in a way that's a good thing. I think it just raised the bar. You know, and then there's all sorts of, there were all sorts of programs that were happening at state. I mean, this term digital diplomacy that everybody interprets in a different way, I think most simply it's leveraging new technologies to achieve foreign policy goals. One of the beauties of digital diplomacy, and I think this is something that some people at the State Department understand quite well, is that it actually doesn't need to entail any diplomats at all. I mean, that's the great thing about digital diplomacy is that what's amazing about these connection technologies is that they allow citizen to citizen communication in a way that was never really possible. It allows diplomats to interact directly with citizens and it allows diplomats to interact directly with one another, you know, kind of without the usual protocol that comes with that. I mean, you see these arguments happening between US ambassador to Russia, Mike McFall and the Ministry of Foreign Affairs and Russia on Twitter. Now, these are usually not very like harmonious interactions but they're happening and that was previously impossible. And I think, you know, when it comes to Twitter specifically, it's radically changing diplomacy and it's of course it's not always good, right? I mean, I think this has been this other sort of silly debate that's been happening over the past few years which is like, well, is social media good or bad? And it's neither, it's both. It's disruptive, it's clearly disruptive. And just one quick, one of the most interesting examples I've seen of Twitter directly impacting foreign affairs was with the Chen Guangcheng debacle. I guess, you know, he, Chen Guangcheng, I'm sure everybody knows, but the blind activist in China who escaped house arrest and made it to the US Embassy. And I don't know if people remember but when he first left the US Embassy, there was this moment when it looked like this unequivocal triumph for the US and China because it was like, wow, they got him out so fast and he was supposed to stay in China and the US was very victorious and China was very victorious and everyone was smiling and taking photos and it was like, okay, end of story. And there was a moment in history where like that really would have been the end of the story. I mean, that was like, that was the narrative. And I was in New York at that time and I was just at home kind of like reading through Twitter and all of a sudden I started seeing these crazy tweets coming from China and it was just like, you know, and they were both in English and Chinese, these were Chen Guangcheng's friends and they were just like, what the media reported was wrong. You guys are all wrong. You know, Chen Guangcheng was pressured, he was forced out of the embassy, he's miserable, this is a nightmare. It was just these like kind of dramatic emphatic tweets and what was amazing to watch was within the span of like a couple hours, the entire media narrative just turned over because there's all these, you know, Western reporters who are on Twitter, they're reading these tweets and they suddenly, all the stories are getting rewritten and all of a sudden the US government who, you know, an hour before had been completely triumphalist was on the defensive and the same for the Chinese government and I'd probably changed history because Chen Guangcheng ended up coming to the United States. Now, would it have happened without Twitter? Probably, but in that fast no and the US and China would have had a lot more time to kind of shape the public perception of events. Now, just quickly, you know, when I was talking about this at the time, some people were like, well, Twitter didn't play a positive and ultimately positive function there and I think it's just a really good example of the double edged sword of Twitter because I think ultimately, you know, yes, Chen Guangcheng ended up maybe in a better situation. However, you know, it created a lot of misinformation because what came out in the days that followed was that the stuff on Twitter wasn't completely right either. So it was also, you know, there was also a lot of misinformation, but that just, I mean, that's just a very simple anecdote about how, you know, something as small as Twitter and in Twitter users in China, there aren't even that many of them, but how they managed to kind of overturn the narratives of the US and Chinese governments. So, yeah. I'd just add one thing which goes completely, one way to think about digital diplomacy is, you know, we have embassies because we assume it's really hard to get information from other countries, right, we go back to the only way to get information was to have a physical entity in another state that originally with people in it and they sent back dispatches and then cables and now emails and that, you know, that determines the whole way we are set up to do foreign policy. The country desks have much more power in the State Department than anybody else because they are in touch with the embassies and people are on the ground. If you start thinking about the ability to communicate to people rather than to their governments, it totally changes the way you think about foreign policy strategy. So, Secretary Clinton also had a strategy for young people, a strategy for women, a strategy for entrepreneurs, a strategy for scientists, because you don't have to think about going through the government to government at all its departments, you can start thinking about, well, who do we need to communicate with and then what is the way to do that? So if you really push it, the entire structure of the State Department and of the way we think about foreign policy ought to change. And just one quick thing, and I'd be interested to hear your thoughts on this too, I think the biggest challenge for any government going forward is gonna be how to manage this because, you know, at first everyone's like, oh, this is so cool, officials can use Twitter to communicate directly with the public, but the truth is that any official who's really been loose and flexible on Twitter has gone into trouble at some point, right? Because it's difficult and I think it's good to do that, it's good to not issue press releases, but it's a high risk scenario. I mean, you look at, I gave the example of Ambassador McFall, I mean, he's very outgoing on Twitter, but he's been attacked, he's gone to all sorts of problems, the U.S. Embassy in Cairo is another one, which has like one of the more colorful Twitter feeds, but have also had a lot of public scrutiny, they've had problems with the Muslim Brotherhood, so it's kind of interesting and I think the more that Twitter becomes a part of U.S. foreign policy, it's like where do you draw the line between diplomats being themselves and having a personality and not having to clear everything, but then, you know, you run the risk of causing a diplomatic incident, so. You definitely have to have a much higher tolerance for failure, our Egyptian Embassy tweeted out John Stuart doing a parody of the Egyptian government taking down their John Stuart, which probably was not the best thing for us to be sending out as a government, so I agree with that. On the other end, the potential, you know, our ambassador in New Zealand has more people following his blog and Twitter feed than read the New Zealand largest daily newspaper, so if your goal in diplomacy is to connect to another society, you've done something enormous. I believe that the Chinese, our embassy in Beijing, the Twitter account that actually puts out the pollution levels every day is because of a huge impact on public opinion. Charles, I wonder if we can get you to talk about everything else. You know, we've been working together more than I think either one of us would like to admit over the last two years, quite a bit, but one of the themes that always comes out in your writing and that I really find resonant is the idea that a lot of the innovations that do the most to help the most number of people in the world are actually incredibly cheap. And I'm just wondering whether you can identify some of the opportunities for the US, for the world really, over the next 10 years, in which we can really make a meaningful difference in fighting things like global poverty and disease and do so for a fraction of what we're spending fighting the war in Afghanistan, for instance. To some extent, if I knew the answer to that, I'd be rich. But thank you. The reason that incredibly cheap matters, obviously, is because most people in the world are incredibly poor. The US poverty line, depending on the number of people in your family, kind of 12, 50 a day, give or take, the median, not the average, but the median income in the world is around three bucks. So half of the world's population lives on less than $3, and still about $600 million live on less than $1.25 a day. They can't afford expensive technologies. They don't have the money. They need to spend that money on food and shelter. It is amazing, therefore, how much technology has had a massive and, by and large, very positive impact on poor people around the world. Just the always cited example is smallpox, which is not killing anybody anymore and killed 300 million people in the last century. And why? We had a vaccine. We spread it globally, and we wiped out the disease. And measles has gone down from 3 million deaths a year to 180,000 worldwide, just over the last 20 years. In disease after disease, we are making massive progress at a very low cost against death. So that's just in health. The fact is that when it comes to the mobile phone, nearly all of the really exciting innovations with the mobile phone haven't come from Silicon Valley. They've come from the developing world in Africa, in particular when it comes to mobile banking. And Pesar has just taken off like wildfire and has taken a country that had literally hundreds of banks for the entire country to a place where most people are actually using mobile banking. It's just massive impact on access to financial services. So I do think it's an exciting time. I mean, it's an exciting time because of the internet. It's an exciting time because of energy. And I take your point, it has turned out to be harder to get renewable energy to be a big part of a global energy portfolio than perhaps we'd originally hoped. But if you look at things like solar-powered lanterns, they really are spreading quite rapidly throughout large chunks of Africa, which have no access at all to electricity. And what people were using before is either kerosene. I mean, a kerosene lamp in your house is about the same as smoking two cigarettes a day. Hundreds of thousands of people yearly worldwide get burns when their kerosene lamp turns over. It is not a pleasant technology. And that's the second best technology a lot of people are using candles or firelight. From that, we've gone to people using solar lanterns, which, by the way, can also power their mobile phones. These technology advances in a whole range of areas really are making a huge difference. But I kind of want to echo the point that technology is great, but it really isn't the whole story. There are five billion mobile phone users worldwide, and there are still the majority of the world living on less than $3 a day. It's not that technology is the answer to everything. There are institutional challenges, educational challenges, huge other challenges that have been around since the dawn of time that we still have to deal with. But I think at the same level of institutional quality and the same level of income, the quality of life of people worldwide has never been higher. I guess one. Should end there. Yeah, we probably should, yes. Unless everyone wants to go get drinks, I think we have to keep going. But let me just ask Charles, one thing that I think a lot of Americans have a misperception, A, that we spend a whole lot of money on foreign aid when we don't. And secondly, the problems that afflict much of the developing world require huge amounts of money to solve. I'm wondering whether you feel that the United States gets enough bang for its buck when it comes to development aid. And if not, what can it should be done to reorient the way in which we spend to get more results for our money? Thank you for asking the question again. And apologies for not answering it the first time around. USAID is a hideously dysfunctional organization. I feel incredibly sorry for the people who work there. There are a lot of good people who are really committed to making the world a better place. And then an institution that seems to be designed to frustrate them at every turn. Despite that fact, USAID is actually doing something, I think, really pretty cool with something called DIV. It's a small, in dollar terms, it's a small output in USAID, gives that sort of development, innovation, ventures. And basically what they do is they have this wonderful model of saying, look, come in with a, it doesn't have to be a tech solution, but a solution to a problem that you think might make a difference to a lot of people in the developing world if you could scale it up. And what we'll do is we'll give you some money to develop your idea. But really what we're giving you money for is to test if your idea actually makes a difference. And they use very good evaluation techniques to figure out if this idea that looks great on paper actually makes a real difference in the world. One of my favorite DIV grantees is something that got the name heckle and chide. In Kenya, road deaths are becoming an absolutely major killer. Now in a way, that's a sign of progress, right? Lots of cars, but it's also incredibly depressing. Pedestrians, by and large, being moaned down by bad drivers. A lot of those bad drivers drive Matatu's, the kind of minibuses that provide a lot of public transport in Nairobi. These people had a very simple idea based on nudge and all the stuff that's got us excited about techniques and nudge people in the right direction in the United States. It was basically what happens if you just put up a sign in the Matatu saying, please complain if your driver is driving too fast. That's clearly not going to work, is it? Stupid idea. They tried it and what they did was they monitored how often drivers made insurance claims on the ground that they'd just run somebody over and needed to make a payment. And I can't remember, it was sort of a halving about of the number of insurance cases in the Matatu's which had this sign. And it was all sort of done in the way that you want these things to done. It was randomized and all sorts of stuff. It really was the effect of a simple sign. People actually started feeling empowered to complain about how bad their driver was driving and drivers drove better and that saved lives. What Dave paid for wasn't the signs, which after all weren't actually very extensive. They paid, I think, a little bit for encouraging drivers to keep the signs up by saying, look, if we still find the sign in your taxi three months later, we'll give you a small payment. But mainly actually for designing the experiment to see if this thing really worked. It saved a lot of lives at, I can't remember how large the grant was, 100,000, maybe, in US government budget terms, not even around the era. And made a real difference. And Dave is small and not liked by many on the hill. And they, too, struggle with all the things that make USAID largely dysfunctional. But they are making a difference. And I think if we could move towards a model that supported that kind of thing, alongside a model that this is one way to encourage technologies that work, there are other ways to encourage technologies that work. One that's worked very well is basically a bunch of donors came together and said pneumococcal diseases killing a lot of people in the developing world. There's not a vaccine for this. Somebody out there develops a vaccine for this is $1.5 billion. We're going to leave in this pot until somebody amends this vaccine. And when they do, we'll use that pot to buy a lot of the vaccine, create a market. Now, tool three drug makers have come up with pneumococcal vaccines. That money is being paid out to them. And those vaccines are being rolled out across the developing world, again, saving lots of lives. So there's lots of different ways of getting new technologies that we know will actually make a difference to the quality of life of people in the developing world out there. And I think the US has a natural advantage in that kind of thing, not just because, obviously, it's a powerhouse of innovation, but also, frankly, because it's a powerhouse of evaluation. We have Jay Powell in MIT, a rub by Abhijit Banerjee and Esther Duflo, one of the world's leading places for doing good evaluations of small projects. And that's just one of a number of examples. So both because of the sort of innovation talent in this country and because of the evaluation talent in this country, it's a place where the United States has a real comparative advantage, unlike as it might be with food aid, where hopefully the system is going to get better. But at the moment, the only way that the United States can help feed people in a famine in Africa is by buying US grain and sticking it on US ships and shipping it there. If you're in a famine in Africa, the last thing you want to do is wait three months while the food gets shipped from the United States. It's the dumbest system ever. Now, hopefully, one of the things that the administration, the environmental administration is trying to do is reform that system. But there are lots of aid that the United States does really, really, really badly. And if we could take some of that money and move it over into areas like this, I think it could make a big difference. All right, I think we should open it up for any questions folks might have for these guys. And there's one right there and another one here. Hi, I'm Moroneal. I'm one of those sad employees at USAID. But I actually, along with Michael Kremmer at Harvard, invented them. So I appreciate the shout out. A couple of things. It actually was a two-thirds reduction in injury-related accidents. And we spent $100,000 to do a randomized control on 1,000 Mataatu buses. We are now spending more money to do 10,000. And the insurance companies have said if it works, they will actually require it of all Mataatu buses. So which gets me to my point, which I think is incredibly important for all foreign assistance. But the thing we built into DIV, which is all the applicants have to show how this is going to scale either through the public sector as a public good or the private sector, but not with USG support long-term. And so think about sustainability at the front end. So I think that, in addition to the small amounts, has been pretty critical to changing the foreign assistance model. But I would love any, you know, since I am here, I would love anybody's feedback on the panel. And if you were in our shoes, and you could change one thing at USAID or our approach to foreign assistance, what recommendations would you have for us? I have mine. Charles, I'm sure you have a few. I mean, if food aid isn't really USAID's fault, but that would be one. And doing more DIV would be another. I honestly did not know more. I was in the audience when I shouted out for DIV. I think moving away from a model based all too much around US many for-profit contractors delivering things in other places that would be better delivered by people in other places themselves is really important. So if you take the mess that is Haiti today, it's 9 billion, I think, of resources went into Haiti. Sort of 3 billion from the US government, 3 billion from foundations and 3 billion from the US government and US foundations, 3 billion from the rest of the world. We can't track it. We don't know where most of that money went. It's hard when you go to Haiti to see where the money could have gone. We do know that a lot of USAID money went to people working in buildings within about 20 miles of where we sit now. Some of it then we believe, although actually you can't get the data. Some of it was then passed on to people in Haiti. At the same time, Mercy Corps, for example, in Haiti, I think quite possibly with USAID backing, was actually taking some money, some small amount of money, and actually using mobile phone technology to get that money into hands of Haitians who could then use it to do whatever they thought they needed to do to recover from the earthquake. If we'd taken that $9 billion and spent a lot more of it or just handed a lot more of it over to Haitians, that would be great. We handed less than 1% of the money over to the Haitian government. I know the Haitian government is corrupt and terribly inefficient. But the fact of the matter is there is no country in the world that is rich, peaceful, successful, that doesn't have an incredibly strong government. You can't bypass the government and think that this is any long-term solution to the problems in Haiti or anywhere else. And so bypassing the Haitian government and the Haitian people and putting nearly all the money into the hands of U.S. contractors, I do think USAID and the State Department and lots of others have guilt there. Did Haitians rule the service? And that is perhaps a worst case example. But it is an example of the way that way too much USAID works. I'll just add two things. So, Mora, first of all, it's proof that things really do happen in government that three years or four years on we could be sitting here. And Charles can be praising Div when you and I both remember when Div had not yet been created. So things get done. You all have made a huge difference. I think I have two things I would say. One is perhaps particularly as the incoming president of New America and the recipient of aid grants. The amount of compliance and the amount of just sheer paper and legal assistance you need to get a USAID grant is really a problem not just necessarily for us, but more because it actually encourages a culture of large development contractors who then subcontract because many smaller innovative entities who would actually be doing a lot of this innovation simply cannot possibly afford to handle an aid grant. So that's one. The second, though, is around hiring. And you and I both know this. I mean, if I could wave a magic wand, both aid and state would be able to take people in, have them for a couple of years, have them then work for a private corporation, an NGO, anywhere else, then go back into USAID and essentially have a far more flexible labor market for not just the political appointees. It works, but for the civil servants and actually for the aid foreign servants. I don't think we're ever going to get to where we need to go unless you have people who've actually crossed cultural boundaries enough so they know how to assemble coalitions on the ground that can get things done. Andres? Thanks, Romesh. First off, I just want to do an institutional plug here. And it's very gratifying, Romesh, to have you here. And Charles, and you mentioned you've been collaborating for a number of years. But I believe you met as fellow fellows at New America. And I remember a lot of spirited thinking out loud sessions we had where you guys first connected. And the fact that you're still here as part of our community is a testament to what the fellows program is trying to do. We, New America, helped liberate Charles from the World Bank and allowed him to pivot to become the public intellectual and bomb thrower that he is now. So congratulations. I was wondering, and maybe we could start with you, Charles, if in one sentence each of you could talk about what will be the dominant issue we'll be wrestling with when we're gathered here in 2020. Why don't you have to start with me? By the way, first of all, yes, thank you. The Schwartz Fellow program is one of the best things has ever happened to me. It is not just about the money, which helped, but it is mainly about the institution and the people. Andrew is first and foremost amongst them. I mean, it's just I had the best time ever. And I won one again. I won one again. Give me another one. So thank you. But I think one of the big long-term challenges is where people are and where the opportunities for them to have their best life is. And I think that's getting increasingly disconnected. So if you are an old person in the United States, this is actually a terrible place to be an old person. If you're past retirement, the health care is hideously expensive. The home care is hideously expensive. It's cold in a lot of the country, a lot of the time. It's just not a great place. If it was much easier for you to move to Mexico or Thailand or one of many developing countries that have hospitals that are accredited to US standards and actually, in many cases, deliver a better standard of care for one-tenth surprise, that would be good for you. And of course, if you're a young person and you're trying to go to college, college in this country is obscenely expensive. And we still have many of the best universities in the world in the United States. But there are a whole load of people in the United States who can't get into those universities. They could go to universities elsewhere that are delivering a really high quality of education, not as good as Harvard, not as good as MIT, but up there, at a much, much lower cost where they could go. So there's a whole load of opportunities for US people to go abroad. This is more than one sentence, I'm sorry, I'm about to stop. And of course, obviously, the reverse holds true, right? There are a whole load of people who could massively benefit from being here. And I hope that the big discussion of the next 10, 15 years, starting with the discussion of immigration reform we're having right now, is the increasing disconnect and idiocy of our current rules on the fact that where you are born has such a massive determination about how the rest of your life should go. How dumb is that? It's completely random. And so if we could start moving the discussion, and I think for all sorts of demographic reasons, we will start moving the discussion in that direction. I'd love to be back in 20 years on a New Shorts fellowship talking about that. Steve? He took all of our sentences. Sorry. I think that 20, Andres, 2020, right? So a more intensively fractured Middle East because the opinions will come out from under the OPEC nations, these anchors of the region, much weakened Russia and a closer relationship with China. So quickly, I guess for some of the reasons that we've mentioned here, I think authoritarian regimes just all over the world are just under a lot of strain. I think it's just much harder to be a traditional authoritarian regime. And I'm not saying that they're going to disappear, but I think we're going to see a lot of just transitions in that area. I'd say two things. One will be water refugees. We're going to be looking at the collapse, particularly if governments cannot pay in the Middle East. But we're going to be seeing countries that are effectively out of water with populations moving. And the second is, I think we may well be talking about some kind of Western hemisphere economic community. We will be finally realizing that our future in the United States lies as much north-south as it does east-west, either across the Atlantic or the Pacific. I'm not just saying that because you're asking the question. I really believe it. Yeah, I think we have time for any more questions just so we can bundle them all if there are any others. There's one here. Let's just take them in succession and then we'll give them up. Thank you. I have a question just because this panel is called Engaging the World. One of the things I've been studying is sort of the civil-military balance in our presence in the world. And I think one of the problems we're facing as a small-D democracy that wants to be a leader is that a lot of the social capital, meaning collaborative relationship-based influence, is in uniform right now. And this is for lots of different reasons. The military has discovered in Iraq and Afghanistan that government is a counter-terrorism strategy. It's what Congress will fund. And Congress has also funded peer networks in uniform for 30 years now, unlike anything in the civilian side. And so I really feel like we have this imbalance. And we're either going to have to make peace with it as a democracy and start talking about Posse and Comitatus again and who does what. And everything from Boston to who can be most effective in other countries, you just keep seeing these uniforms appearing in this sort of militarized presence. And I feel like Americans are getting increasingly comfortable with it without a conversation about it. What do we do about that? Should I go ahead? Yeah, for Steve, you made the point that there's going to be a lot of surplus oil. And you also made the point that many of the producing countries have very high break-evens. Why should we expect them to not just simply shut in some of their production to maintain the price at levels which they need? And I think we have one more here. Charles, this is for you. I'm wondering what you think about kind of a new movement in development aid, which is organizations like Give Directly, which transfer money directly into savings accounts of people in Kenya. So what do you think about that? Okay, Steve, why don't you talk about oil, Charles, direct charities? And then, Henry, maybe you can finish with a big picture question about our militaristic face around the world and how to change that. So, Steve. The reason is that OPEC can shut in oil, but the calculus, remember, is price and number of barrels. So you shut in oil, you're selling fewer barrels at a lower, maybe the price will go up, but you still aren't earning the same amount of money. And in fact, you're earning, if the projection is correct, you're earning a lot less than you need for that break-even point to run the government. Charles? The model of poverty which says the reason that poor people are poor is their fault is what leads to kind of a broad aid industry we have today. That model is wrong. The give directly model is poor people are fault, poor because of the circumstances they are in, help them change their circumstances and they will do better. Give directly, give them cash to help them do precisely that. I think it's wonderful. In one minute, so, you know, we wrote the Quadrennial Diplomacy and Development Review and it was called Leading Through Civilian Power and you're telling me it didn't change everything? I'm crushed. You know, I actually think one of the other things that's on the agenda, we haven't talked about it at all, but of course we are about to go through the biggest military budget cuts we've certainly seen in our lifetime and that is going to trigger so much reassessment not only around what the military thinks it needs, but here's what's critical about the military's relationship with Congress, right? Because Congress, often you have the military saying we don't want things and Congress saying, oh yes you do, because it benefits us. So it seems to me you're gonna have a rebalancing simply by virtue of the greater cost effectiveness of prevention, development, diplomacy and because the traditional ability and desire of the military to simply fund whatever it wanted to fund is going to be decreased. That said, I think it is important to note I just had a student write a paper on how you stop or what have been the determinant factors when you've had military coups, then civilian governments, when, how can you stop the military from taking over again? And that's obviously a huge question in Burma right now if I'm assuming it becomes a non-military government, how do you stop that? One of the most cost effective ways, and you know this, is embedding militaries of new civilian governments into professional development networks. So those, a lot of those networks do have value, but the issue is how you preserve that, but take away the fact that as you said that our overall face is a military one. And yes, I'm the woman who's recommending military intervention in Syria, I do get the irony of that, but I'm not recommending staying for any length of time. Well, let me just say my one word answer to Andres' question is China, which is of course the subject of our dinner conversation, but for now the bar's open. Thank you to this panel for an excellent discussion. Thank you.