The "Globalism and Its Discontents: Point/Counterpoint" conversation series features Amherst College professor, and host of NEPR's In Contrast, Ilan Stavans and a guest engaging in thoughtful discussion and attempting to bridge the ideological divide growing in our nation.

Saskia Sassen; Sept. 20, 2018

September 28, 2018

Saskia Sassen, the Robert S. Lynd Professor of Sociology at Columbia University and a member of its Committee on Global Thought, joined Spanish Professor and host of NPR's In Contrast, Ilan Stavans for a conversation in Stirn Auditorium.

- Hello everybody, my name is Ilan Stavans, and it is my pleasure to welcome you to the second of five public conversations that we are having this semester in Point Counterpoint, the topic is Globalism and its Discontent. These lectures and a seminar that is connected with it, the guests that are coming are all funded by a generous gift from let's see if I get this right, 36 members of the 50th reunion the class of 1970. And I am, and all of us, grateful some of them might be here in the audience, others will be at either some events, sometimes in the seminar that we are having in the morning as well.

I want to give you, for some of you who are attending today for the first time, a sense of what it started and what the goal is. It is basically a response to a sense of isolation, and an echo chamber, that some of us within the academic world have been experiencing, for some time, but that became more acute after the election of 2016, the sense that within the academic world, in campuses across the country, we are listening to the same voices, we are replicating the same messages, and not exposing our students ourselves and the population at large to the other side, which comes also with a sense of dehumanization of that other side, those that don't think like us have to be our enemies, those that do not think like us, living in our same country but are bringing that country down.

The goal is to bring reason and logic and empathy to the dialog, you can have racial, gender and ethnic diversity, you also need ideological diversity to have a fruitful education, here connecting particularly with students. And for us professors obviously, otherwise we ourselves become towers that are disconnected with the rest of the world. And I'm very happy that this lecture, this is the second year, has touched a chord not only within campus and the five colleges, but in the larger community, we have a lot of people from the general public so to speak, that have been coming that have been participating, that engage in these dialogues, and that also feels a fruitful and appropriate attempt to make us within this college and the hell to become more integrated within the rest of the community.

So thank you all for coming, the purpose is to listen, to listen and to understand how others think. Of course there is a microphone here to my left and you're right, wherein the second part of today's event people are invited to come in and share your views, ask questions of the guest. I ask you if you're gonna do that, to just find your place in it, we're going to be brief to the extent that is possible, and in a way that keeps the conversation going.

And I finally want to say, that you are likely to hear today, as you did at the last event on Tuesday, with George Will things that you disagree with, I am hoping that you will disagree with a bunch of things, and that is the purpose, the purpose is not for you to hear what you have been trained to hear, but for you to hear other views, and to try to understand those other views, and to see them with that, as I was saying with reason and logic and empathy. And I want to invite you to come to the next one, it is Joseph Stiglitz, It will be in October 20 something, 21st, you'll get information in the radio and newspapers. After that, we have Amartya Sen, who is coming in November, and Martha Nussbaum comes also at the very end of November.

The spectrum of guests include columnists, philosophers, political scientists, economists and sociologists, which brings me to Saskia Sassen. It's a pleasure to have her here with me, she was today at the seminar, after that this event and the entire series is also sponsored, or co-sponsored by the NAPR Podcast, in contrast where we had a conversation that will be aired very soon, and now the discussion, the public conversation with you. I meant to say this, because you will likely hear references to something that was said in class, or something that was said in the podcast, and I will try to ease or massage the information in such a way so that you feel that you were in those two incarnations as well. Saskia Sassen is an internationally renowned scholar and public speaker, who is concerned with the topic of the global city. She is interested in the flow of migration, be that labor-related, or financial, as it defines the structure, the carcass of the ancient, medieval, pre-modern and modern city, but particularly with an emphasis around the end of the 20th century, and 2008 with the economic debacle that we all went through. She is an award-winning writer, the author of a number of books, some of her books, particularly the last one expulsions, are available outside, courtesy of Amber's Books, and we thank them also for this, she will be signing books at the very end. Many of her books have been translated to numerous languages, she advises for a number of different governments.

- Never for money.

- Never for money, good.

- That's very important.

- And for other entities in China, in Japan, in different parts of Europe, in the United States she teaches at Columbia University, in the sociology department. And she is originally from The Netherlands, she grew up in Argentina, in Rome, among other places, and one of the features of her approach to the research that she does, is multilingual, she is a speaker of a number of different languages.

- But one perfectly.

- That's what I was gonna say, she stressed in the class, that though she knows a number none of them--

- Six.

- In a perfect way, I myself think that there is no perfect way to speak a language either. I wanna start directly Saskia with the question of migration, both of labor and of capital, but I wanted to be able to invite you to bring us all to this category, or this concept that you yourself are the one who created it and has become a staple, the global city. You have stressed in your work, and also in a number of lectures, Ted Talks, that there's a difference between the international city and the global city, one thing is international, the other one is global, what do you, what should we understand by global?

- Well first let me say thank you, thank you for being here. When I started working on the global city, I was after a very specific function, and I called that function the rise, the growth of intermediation. What we had, what was the basic landscape in all major advanced economies, was big firms in big buildings, they did everything in-house, which meant that you could start very low, and you could build your way up, many middle classes emerged out of that. I saw that there was another phenomenon, and I want to remind us all that in the 1970s cities were poor, they were really poor, New York was officially broke, London was poor, Paris was poor, so why, because the economy until that point had really been an economy of building infrastructure, sort of the whole territorial bit and then the suburbs. So when I was in New York I arrived as a foreigner, very, very much a foreigner, and I remember going to a first meeting, where there were a bunch of planners, they were all men as it happened to be, and I remember approaching them, I was totally innocent, I was really a foreigner, and I looked much younger than I actually was, and I'm short and they were not short. So you can see the setting, almost like a theatrical moment, and I went up to them, and really in innocence, but an honest question, I said, "I would really like "to know what's happening on Wall Street, "I understand you're all experts on the matter." I was very polite with my speech. "And I just wonder if you can help me gain access?" And this deadly silence, it was like a bunch of five, these big famous planners, and they looked at me like saying where did this microbe come from. And then they laughed, they simultaneously laughed, so it clearly had to hit a chord with all of them, and they said, "You know what? "Wall Street during the day is ours, "you can go at night." Of course at night at that point there was no Wall Street, there were some computers, but it closed up, and after they finished saying that, they all haw, haw, haw, all laughed. And I still being very polite, because I haven't lived too long in New York yet, because you know it changes. I said well thank you so much, and I hated them, you can imagine that right, I turned my back and I left. But then I had done a study on immigrants, who of course were the cleaners on Wall Street were all immigrants, and they all spoke Spanish, they were all Dominicans, and I speak Spanish, so I decided, aha I'm going to ask the cleaners, and so I asked the cleaners, and the language is can I have lunch with you, lunch happens at midnight. The cleaners of course, the janitors, they were janitors, they have access to everything, every little thing, but they have rules, they have a code of conduct, et cetera. So I go, I also bring my sandwich, and at midnight in a very dark area, it was called Wall Street, still is called Wall Street, but it has lots of lights now, I had lunch with them, as we were having lunch, at one point I asked them, but for whom are you cleaning, since all we read in the newspapers is that all the firms are leaving. And out of that then came my first, I had the sense that something was happening in these big buildings that had been hollowed out, and in fact then I found it, multiple very, very fancy firms, including firms like Goldman Sachs but which were much smaller. And so that was my first indication, that a whole economy of mostly very fancy smallish rather than huge corporations had installed itself in these older buildings, and when you are outside you didn't see them, all you saw was a big bulky building, so I just will never forget that the janitors had the bit of knowledge that I needed. That was a very long answer, I'll try to be briefer, but it's an irresistible story.

- You have been very concerned with the acquisition of space in the global city of entities that have nothing to do directly with that city that are foreigners, I'm thinking here of the Russian oligarchs that buy property in London, Chinese millionaires that buy it in New York, but what interests you and I want you to take over from there, what interests you is the fact that many of these buildings acquired by these foreign individuals are not used, are empty, and as such they are a symbol, and they are also an asset.

- So we all know, I'm sure you all know that there has been a lot of buying of buildings by foreigners, by locals, by nationals, this is happening in all the major cities, it's happening in Paris, it's happening in Frankfurt, it's happening in New York and London, and so I started to study a few years ago, and I called at study Who Owns the City? A title that resonated with people, because it sort of went around the world, so I found out from all kinds of other people, who told me in my city, in Milan, or, this is also happening. So I started to inquire what was happening. Now there are two modes of it, one is the familiar mode, you buy a building because you can clean your dirty money. I'm assuming that everybody is aware of that, this is a very common practice, and the buyers are not necessarily dodgy, but the way they bought the building or acquired the building is dodgy, they may be very outstanding whatever, but there's a little step in there. So one thing is a very well done building where you can charge a lot of rent, either for offices or for residences. But I began to notice a couple of years ago that many of these buildings were empty, newly built buildings empty. And New York is famous for it, and London is famous for it, and there are a bunch of other cities like that, it's known that there are a lot of empty buildings. And these are high-rise buildings, they're not modest little obscure little buildings. And so I wanted to understand the general commentary on the matter was this, they cleansed their money, or they failed to make them rentable, that was a very common notion. And I went digging a bit deeper, and in fact what we are seeing, but it's not visible to the eye, is that an empty building, a high quality building, can actually function as a collection of assets, especially if it is empty. And the high investment circuit keeps asking the financial experts, their advisers, give me an asset-backed security, no more derivatives, the derivatives, we are stuck with that, in our pension funds, oh yeah, buy these derivatives, a derivative can be an enormously long chain, you derive the value from something but who knows where it started. Now regularly we are seeing incidents, the latest one happened a few months ago, 40 municipal governments in Italy all went broke at the same time, the same day, the same minute. What happened? One of those derivatives that had been sold, and the financiers make money off that, in principle the derivative is an innocent condition, but the way it gets deployed as a bit less innocent. And this has been happening, in fact in a county in California, that was the first time that they tried it, and that goes back 10 years ago with a derivative. So suddenly these municipal governments that thought they had just bought a loan kind of, find themselves broke. And so that is just one example, now the derivative, there is an abundance of derivatives, and the high level investors simply have told the financial system no more derivatives, at least for a while. Which also tells you something, if you go with your TIA graph, et cetera, they'll tell you, oh yeah, you should buy these derivatives, and you buy seven different, each one of those takes a bit of money out, and they have become a bit dodgy, there are too many, we don't know what the asset actually after it. And so what then happens with the new format, which is to make it into an asset-backed security. The buildings, the empty buildings are assets, and if you don't have people them you don't have any trouble, if you have people you have to keep cleaning, fix the toilet, I don't know what all right. Now I want to back up, just to give you a bit of context, can I?

- Please.

- Or am I speaking too long here? Goldman Sachs, we all know what that is, admirable intelligences. So when you walked into Goldman Sachs 15 years ago, you had the back room where there were a hundred secretaries, now you walk into Goldman Sachs, the back room is still there, but they're all physicists. They're physicists, not doctors, physicists. Well they can have doctorates in physics, I mean they're not physicians, they are physicists, and I don't hold them culpable, but that's what we're talking about, we're talking about something that has nothing to do--

- [Ilan] The role of this physicist is?

- First, let me say it's algorithmic mathematics that they're using. And remember the algorithm is open, we all can make algorithms, by the way, we can all make algorithms, that is not complicated, but when you bring in mathematical algorithms it's a bit different, it gets to be very complicated. And again I want to emphasize I don't blame them, they just love their work, by the time they're 30 or 35, they often have done their major contributions, unlike you and I, we have to wait, we're still hoping at something. And so it's like an impressive thing, you have these brilliant minds producing instruments. Now I get one of them, whom I know, he's a colleague, et cetera, at Colombia, to explain to me one instrument, which is the famous sub-prime mortgage, you've all heard of this? And he showed me all the complex steps that had to be executed to have the sub-prime mortgage. Okay that's another conversation, do you want to ask me another question, because then you know, sub-prime mortgage was a disaster, I don't know if people know this, 14 million households kaput, and it took a story of eight years, that is amazing.

- I wanted to go back shortly to explain a little bit more the role that these physicists are having at Goldman Sachs, why physicists now and not then?

- Okay because this is not economics, this is not microeconomics, it's not macroeconomics, this is something else, this is algorithmic mathematics, and algorithmic mathematics allows you as I said, these are open systems, it allows you to construct them, and again we are teaching in some schools, we're teaching little kids, so you have them very complicated like they did, or you have them very simple. So the algorithm has become, like she's the queen of the domain, because even children now are being taught, because you can design it. With not that many flops. When we design we don't always succeed, but it's a certain kind of concept.

- In one of your books, as part of the research that you've been doing, you talk about the acquisition of land in Africa, in Latin America, mostly, although in other parts of the world to, by large corporations, and I'm gonna go back to the topic of large corporations to these sub-prime mortgages into the concept of too big to fail, but after this. In acquiring them in a kind of silent way, because of the strategies that they have in order to remain competitive, I want you to talk about the role of land acquisition and water acquisition by these big corporations and the connection they have or don't have, corrupt or legal, with governments that allow them in?

- Let me start with simple examples, just to put it on the ground here, on the table. So in the United States, we have some very big water bottlers, Coca-Cola, also Nestle, you know Nestle does water. And for instance when we had a drought in California, they were still allowed to keep on, and they pay almost nothing. It's a scandal. In Michigan, a very well run state, they managed to exhaust the underground water supply of one particular neighborhood. These are just little examples, but here's the image, the image is these very powerful firms enter the picture, and they start grabbing water, it's the same water that you and I have, but they have vast amounts of water that they take, they pay almost nothing, and then they bottle it, and they sell it to us for a rather pricey price I would say. Now this is in the United States, imagine in poorer countries, in the United States with all its problems it still has regulations, rules count, and Michigan is a very well run state, and I'm just amazed at it also, they have been very active in Texas, and states that seem a bit less manageable maybe, so that to me it was quite shocking. Now in India for instance, Coca-Cola managed to exhaust the underground water supply of two regions. India has many regions. And when they were done extracting all the water, they left, and they left a dry zone where the residents which are all mostly poor depend on the government sending a truck, this is India, you understand how dodgy that could be, waiting for the government to bring in the truck, and these are not remote, but nor are they very central, to bring them water, and every now and then the truck breaks down, so they don't. These are stories that you can't believe that this is happening, these are very extreme conditions I gave you, but they keep on going, and as I said, in this country, there are also doing it, they are doing it in California while California is desperate for water.

- And the same thing goes for land, 'cause there's the--

- [Saskia] And the land thing, right, and land--

- Go ahead.

- So two moments, one is a visual moment, we have all these amazing landscapes now or maps that we can see, because they were taken by the international satellite, and it looks like many of these areas in Africa for instance that there is a lot of empty land, it looks like an abundance of land, why should we worry. Well in fact a lot of that land is poisoned, it's dying, you have a bunch of big corporations, over a hundred, and you have about 30 governments, that includes the Chinese government, the British government, the American government, all kinds, who are simply grabbing land to grow plantations, which kill the land also very quickly, to grab water, to do mining and all kinds of things. In that process then is a huge displacement of smallholders, with the mines, because the mines poisoned the water, it's more than just the mine, they grab the water from a river and then the river is contaminated, so it's disastrous. So where do they go? They go to the slums and big cities. When it comes to the big plantations, huge plantations, they simply expelled smallholders who cannot show a contract, and they wind up where? In the big slums around the cities. Now when the smallholders own the land they keep it alive for centuries. This is a story that repeats itself in Latin America, when the big plantations come in, 70 years and they begin to decay. So these are little histories in the making, that actually have catastrophic outcomes, and these are all legitimate big operators, they are all legitimate, they are all kosher as we might say, though they are really not kosher.

- We have a lexicon such For that type of a transnational enterprise, that goes back to Marco Polo and Columbus, and it's called colonialism, and we have the lexicon that unfolds itself to a postcolonial world, but we don't use that lexicon when it comes to corporations, because they are not attached to nations, they are autonomous entities that travel in a global way, so Nestle or Coca-Cola don't represent New York exclusively or don't represent London, they represent Nestle and Coca-Cola.

- No absolutely, the corporate world, I mean there's some very good corporations that really try to help, but the corporations, you know there is a recent history written by a legal scholar, a lawyer, who examined the extent to which corporations for about 200 years and more, have been shaping the law in this country. Just that which support their case, what they need, and this is quite a discovery actually, this is like a vector that runs through a very complex legal system that is our law, but there is this little vector that is also hanging in there that produces certain outcomes that seem fairly reasonable time one, and by time three, we discover that they're a bit destructive. That piece, I think everybody should read that, because it is really a revelation, it caused quite a bit of a debate, so the corporations, the big corporations have known from very early on how to make things work for them. The average citizen, every now and then has had that same effect, they have made claims and they have succeeded, but it's not quite the sustained being aware, and we see that now also with some of the international treaties, that corporations are more privileged I would say than the average citizen, vis-i-vis the law, I'm not talking about liking them, I'm talking about the legal condition.

- It may be parallel to this Saskia, or as a result of this, and this was a topic, the one that I'm about to go, we discussed that I had in conversation, had George Will in conversation about, and that is the topic of the role of the elites, or the elite, in your studies of cities, of the global city, you talk about elites that work often with corporations that don't have any roots, don't have any attachment, you need somebody who is going to be needed in London to do something on Azerbaijan, and a specialist will come, do the work for X amount of hours and then go to another corporation where he or she will be needed in an equal way. And the result here is a group of individuals with no feet on the ground, or with an eternal sense of floating, of disconnection. Maybe this could be a good way to bring you to discuss the tension between the universal and the local in the global city, the rootedness or the anchoring of those corporations and the shrinking of middle class as a result of that?

- I think I see it a bit differently, I mean that is in play, but those would not be the vectors let's say, I love this term vectors, I said it too many times, I promise I won't say once again this evening okay?

- We will see.

- You test me. I would put it a bit differently, in the sense that my image is, so up to the 1980s, there was a period right before the 1980s, cities were very poor, remember New York was officially bankrupt right, and a lot of other cities, I already said at the start today, but they were poor. And so when this new economy installs itself, and the image that I have, so remember the big corporations they sort of left the cities, they didn't need the cities, all the big things about, what is it, insurance they went to Har-

- [Ilan] Hartford?

- Yeah, wide be in New York? You didn't need to be in New York, but what then happens is globalization, and remember that by the 1980s we had privatized a lot of what used to be public domain, we had opened up to other countries, the globalizing bit, and there was a bunch of things, so out of that comes the possibility of all kinds of actors entering our economy, very significant actors, and the image that I have, is think New York, New York is broke, the middle classes have been trying to leave, there are a lot of poor people, and there are of course the old rich and some new rich. And New York actually is reinvented, by a particular kind of economic mode that is now dominant, and that is the intermediate sector, this intermediation function that I really am very keen on, and that is that as firms decide to go global, including these big corporations, the traditional corporations, they can be where ever, it doesn't matter, they can go to Hertford so to say, but what they need is somewhere, a site, a place, a city whatever, that can give them 18 hours of Argentinian accounting, 25 hours of how do the Germans like it, 81 of how do the Chinese, et cetera, a lot of expertise. But just a limited amount of their time, so you can't hire them full-time, because you don't need them full-time and there wouldn't be enough of them, so this intermediate sector is a sector that can deliver all of that, in accounting, in law, in prediction of investments, in whatever you need, super smart, highly paid, and they are mobile on some level, but they really are there, they are available, and this is a sector that has really grown. Incredibly highly paid people, so those are the rich that we notice, the old rich, the 1%, they've always been there, but when you have 40% on very high income, not superrich, but very, very high incomes, that you notice, you notice on the housing question, you notice in the restaurants, in the shops, because in New York City or in Manhattan especially, suddenly all kinds of people who felt they could go on living in New York they're out, there is no way they can pay, in Soho which is to be a place where I first started was cheap, per month for a flat in Soho you pay between 14,000 and $20,000 per month, and it's very difficult to get, because there are so many of these young people who have been paid very high salaries in this new economy, so my image is like a whole new system of small firms, extremely specialized, with top of the, how do you say it?

- [Ilan] Top-of-the-line.

- Top-of-the-line expertise, they can deliver anything, and that installs itself in the city, displaces the policeman, the teachers, the nurses, the fireman, et cetera, et cetera, the local residents have to subsidize the government for the fireman and the policeman, because we want the fireman close by, we don't want them two hours away. The whole thing changes, and in the meantime this other world keeps expanding, and they literally grab land.

- So you talk about the 1% and the 40%.

- Yeah in a city like New York it's really up to 40% that really have very, very high incomes.

- So I want you to go to the 59, the remaining one, where's the middle and where's the bottom?

- Well we have a growing bottom, that also happens with age to all of us, but this is a different condition, right? So you have, you have a very significant very rich class that is not the super-super-rich, but boy are they rich, let's face it, and where before three families lived, now it's one huge flat for one person. It's unbelievable. So then you have the old middle class, the teachers, the fireman, they are having trouble, they need subsidized, if you want them close by, and some of them you want close by to the center of the city, we have to pay for that extra, because they can't afford it. This is happening in Silicon Valley, this is happening in many places, this is not just New York, New York is just one extreme case. And then we have a growing mass of impoverished modest middle classes, whose children thought that they were going to follow the career of the parents, every generation does a little better, and the children, they got their degrees the hard way, and they can't find jobs, so that is the tragic aspect.

- So just as the cities were in bankruptcy, when you started the conversation, are we going in a direction of either a cleansing of those that are no longer able to afford it, and the city is weeding out, and deferring the budget for the fireman and the teachers from the government to the citizens, although you are reluctant to use the word citizen as we used it before, are we going in the direction of another doom scenario? Or have we arrived there?

- Well I think this is like a dividing, you can't just say okay, they're the modest working classes, they might become modest middle classes, and the middle classes are really, really good, sort of an mixture of possibilities, that is sort of broken, so the new very advanced sectors need a certain kind of very, very smart workforce, et cetera, that is mobile that can yeah, tomorrow you're going to go to Mongolia, you just go where ever. And then they need the cleaners, so the cleaner, how do you call it when women take care of a household? Household? Well the nannies, the maids, but they're much more than maids you know, they go shopping. Anyhow they have become super important, because you have a lot of women who have either very busy social lives, and takes care of the hair, and I don't know what all, time, and so they want that, or they have jobs, they have really demanding jobs, so it's not just the men here. But what happened, the irony, so I have been part of an effort to organize household workers, and we started in the suburbs, zero effect, zero, but that part of Manhattan is superrich, with all of that, they, so they are organized, they have a union, and they can, why? Because if they're good, their employers cannot afford to say, you want that? Out. They need them, because they cannot run the household without them, so that is an ironic little thing, I wish there were many more of those. So what has disappeared are these intermediate sectors, they were serious people, they had good educations, they meant well, they were loyal to the firm, et cetera, and they hoped to sort of move up, the moving up broke.

- Are you saying, and I just before I go to the next topic, are you saying that this vision, that this country, in particular, had the American dream, your children are gonna be better off than you are, there is class mobility, has undergone a profound transformation?

- I think so, I think it really is a different country, and the question then is, this is one question that has guided a lot of my work, is how do complex systems change. And they don't necessarily change if they are complex by changing everything, so that transformation is not always visible. Now in my reading by the 1980s, we know that the system has changed, now these complex systems don't change everything, but they change just enough to make the severe difference, and I think that is what has happened, and not just by the way in New York, but also in Paris and all these major cities, so that marks a difference.

- We've been talking about the two topics that I posed at the beginning, that is the fluidity or the migration of capital, and the migration of labor, or at least across the hierarchy, and in between nations. But I wanna go now to the topic of refugees, immigrants in particular, we are at a time when at least in this country, uncertainly as populism has emerged in major countries around the world, the topic of immigrants and immigration is explosive, is polarizing, and we also see dramatic moves of people from the developing countries to the developed, particularly in the summer for instance, the big boats going from Africa to Greece and Italy. Dubois talked about the 20th century as the century that would be defined by the color line, the 21st century seems to be defined by this mobility that is not empty of color, it's not empty of gender, those are lines that cut it, how do you see refugees and migration within the context of the global city?

- So I started out by saying that there are two familiar migrant subjects or actors, by subject I mean, I mean people, right? The immigrant, and there is law, its national law, it's messy, but there is law, that is a person who can be recognized via law. And then we have a refugee, and international regime, again very faulty, et cetera, et cetera, but the refugee is recognized in law. I argue that we have a third migrating subject, and I wrote a very long boring article about this, and this third migrant subject, when she comes to our borders so to say, she is not recognized in either one of those laws, why? Very simple answer, because it's really a complicated story, Because her country, when they look at what's happening in her country, my God, GDP per capita, a very important measure, GDP per capita is growing, your country's doing so well, well what is the growth? I think you already know what I was going to say, it's that the plantations have replaced the smallholders, the mines have evicted all kinds of other modes of survival, in the cities you have this emergent rich class which is displacing others, so what is registered by our current measures, which Stiglitz for one, and Amartya, they have fought those, what gets registered as growth, is actually the destruction of existing multiple small operations that sustained vast numbers of people, plus also the fact that that land is going to die, either because of the mining, the poisoning, or because the extracting of water, or because plantation agriculture which kills the land in about 70 years, it becomes less productive. So we have this invisible third subject, I wrote a very long boring article about this, that you have to read.

- [Ilan] I've heard the word boring twice.

- I had to document a lot of stuff to make the argument you see, so our existing measures they don't help us really understand, and that's just one example, there are other examples of how we are measuring stuff, and why should measures that we developed almost a hundred years ago still work as well, it's not necessarily the case.

- In another part of your work you talk about the fact that it is not how many refugees Europe or the United States, we call them refugees, or the undocumented immigrants are having, but how many we are not having, how many are staying behind.

- No, I mean it's very serious, again a lot of these people are expelled, number two, I like to emphasize, if all the people who are poor, exploited, et cetera who don't see a future for their children where they are, if they all were migrants, it would look very different, it would feel very different, it's amazing how limited the numbers are ultimately.

- [Ilan] And this is because?

- Of the total migration, and this is in line in my reading, because most people who are poor are not migrating, and so the question then becomes who is the migrant, well very often the migrant is somebody who's had an interaction with that other world, the modern factory, the modern this, the modern that, and so they are the ones, one simple way to put it, hey I did it for them here in the Dominican Republic, you know what I can do it for them in New York too. So they have, because that is the only good explanation we have for why not more people migrate, the most common formula is, if you're poor you're motivated to migrate. Well you know what, we should have two or three billion migrants in the world, and we have much less than a billion, and in that sense if you have become part of that modern, modern as we call it system, you have been employed by them, you know them, then you say, ah, I do it here for them, I can do it in their country for them as well. That is a bit the logic, now I'm simplifying a bit, but I have really looked at this in depth.

- And you talk about the city as, correct me because you, as an open but unfinished, complex but unfinished--

- Incomplete.

- Incomplete.

- [Saskia] Meaning really something left unfinished.

- Incomplete, meaning that it's always in a state of desiring that completion.

- That's the big question, because completeness would kill it, does it know that, I don't know. But that is why the urbanite is someone who, they're open, you have to be a bit open, otherwise you go crazy, if you're very, you're not happy in a city, then you go to the suburbs right? So there is something there.

- And what you're saying about those that migrate, is that there is a network among them also enables them that dream of going to the other side, if the city is a system, there is also a system among those that are migrating that is taking that step.

- Yeah the Jamaicans are famous for having started all kinds of businesses here in New York City, at least that's the case that I know very well, and then exported back to their countries, I mean there is a lot of trading, trade is a very solid sort of ground from which to. But I find it very interesting, for me the question is not why do they migrate, but why don't we have much bigger migrations? Even what we have seen now, I don't know if people followed what is happening in Central America, where there are two different brutalities, there are many, but one is the land grabs by major actors, local. And the other one of course is what's happening in Nicaragua, which is one real ironic turn of events I would say.

- The revolutionaries that are now the dictators.

- But he was always problematic, I got to know him, I did a big party for him way back when, in the early 1980s.

- You mean in New York?

- Yeah, in Manhattan.

- Saskia, I want to go to one last question, and then invite the public to come and engage you and interact with you, and that is the question of what to do, you seem to be on the one hand, very distressed by what globalism is all about, and on the other hand, from your work in your interviews, in the conversations that you and I have had over time, excited about how the global changes, or seeing this as bringing elements that are positive. So I wonder if you believe that the controlling at these transnational corporations ought to remain the business of the government, you seem to me to propose a view that the government is the one that can curtail, limit, corral, or at least attempt to, or are we talking about a movement that is beyond any corralling?

- Look, I do a lot with the law, I have written many law articles, and I often go to law schools. And I think that we need new law for one, we need to throw out quite a few old laws. The making of law has fallen behind, our legislators confront such complex systems, because traditional banking is one thing, commerce, but high finance? It's algorithmic mathematics, I mean it's very, very complex.

- [Ilan] And many politicians have no idea.

- No idea, nor are they ever going to try. So when you look, second sort of little thing here, most of the political classes, especially Congress et cetera we have good data on it, they all retire rich, their salaries do not explain that. I don't know if all by the way, but we know that a big majority. So the question of governing, which is serious stuff, which should include experts on particularly delicate, like climate change, et cetera, and we should include people don't know anything about anything because they see it with a fresh view, we should take it seriously, and that his what has failed, there is a sense of entitlement, there is a sense that they don't do their homework, when they have to call the financiers, they delegate to the financiers, because they don't understand it.

- So more than laws, do we need in your view, a new political elite?

- No, we need to kill some of the old laws, we need to make new laws, and some of the new laws have been killed.

- You said kill the laws but not kill the lawyers.

- No not the lawyers, well some lawyers, okay, we can accept a few you know, but, I think we are in a decaying Constitutional moment, not that our Constitution is decaying, but that we need to insert certain of our challenges into legal modes. You know I'm not a fanatic about the law, the law has its limits, I think I mentioned it at the beginning, but I want to repeat it, but we now have, some researchers have found, if you look at how the corporations, have been treated, which is very well by the law, they have worked very hard for 200 years to change a little bit here, change the law a bit there, I mean we have famous cases that became very public events, where you see the fight between the working classes and the big firms, but overall, and certainly I would say in the 1980s, so that is an abuse, why does the top have to be so rich that they don't know what to do with their money, and you have impoverished workers, this idea that okay if I can reduce the wages in my, even if you're rich, then you do that, there is a real notion in this country that if you can do it cheaper, by God you do it cheaper, that is what the good God would want, I mean they take it to an extreme I don't mean to offend anybody.

- I'm gonna open it to the audience, hopefully there will be questions, please come to the microphone, anybody who wants to start, we have one here. Go ahead.

- Thank you for coming, my question has to do with the 2008 financial crisis, this being the 10 year anniversary articles are being written, and I'm seeing a theme among them, and that is that the writers are saying that the rise of populism in general, and Trump in particular, can be traced to the failure of government to really hold Wall Street accountable, and so my question is do you feel that the government or somebody should have done more to hold Wall Street accountable, specifically that the CEOs of those firms at the very least should have lost their jobs, and even the shareholders should have taken some financial hit because they are the risk takers.

- [Ilan] Have we learned anything?

- I completely agree with all the negatives that you presented. I mean it is a scandal, and it has recurred, as you say also how Bernanke handled it, so I want us to remember collectively, there was this very beautiful moment when Congress had decided to allocate a certain amount of money, both to the banks and to the general sort of whatever, the economy of modest actors, and so it was a big victory, everybody felt good about it, this was very public, the Congress can be a very public space, at the same time, and it was like, I can't remember the exact figures now, I don't want to give you the wrong figures, but it was billions, it was a significant amount of money, and at the same time Bernanke, mind you a professor from Princeton, not some sort of whatever, accepted the proposal from the big financial firms to allocate an amount of money that was many, many, many times higher than what Congress has decided to give the general public, and that was secret. And they got money, a vast amount of money, now two things happened, some journalists, and this was secret, this was not talked about, what happened, which is wrong, because it's our Institution. And some journalist, who knows me also, because I was tracking it, submitted, a Freedom of Information Act, which was what actually was paid or given to the big banks. And it took them three years to respond, this is our Central Bank, which has all kinds of brilliant minds, they should have done it immediately, by the time they come out with the information nobody noticed. The Financial Times, a very serious good newspaper I think, published a front-page when that came out, now this is like years, three years after the crisis, where they show 14,000 requests from big banks from all over, yes I'll take your money, I'll take it, I mean it was money not only to the American, because the American firms of course are international also, but to all kinds of others, it was an amazing description of a total abuse, and so they were dealing in millions and billions, and the Congress had dealt with a far lower order of magnitude. Almost nobody saw that article, because it was a full-page, full of numbers, my God did I get a headache just looking at it, and three years had passed. So the banks came out triumphant, because even those who have been mobilizing and said that's enough, by then their lives, they probably were a bit poorer, and a bit more tired and a bit older, and when you see that it just hurts me, that the people know that there was something wrong, they decide to enable a bit but not to do that. I mean the Central Bank is meant to be an extremely responsible serious operation, this was the work of bandits, Bernanke absolutely conducted himself incorrectly, this is absolutely not acceptable conduct, and he was a professor, and why? Because he was just overwhelmed by all these brilliant.

- [Ilan] So the lesson that one takes from that is that the next time around, it's not that it's too big to fail, but it's too complex, too defiant, too self-regulating, and ultimately the failure of the past will not become a lesson for the present or the future in your view.

- That's right, the lesson is complicated, you have many, many different factors in play, so it's not easy, I've been working on this for years, so that's very different from. So you are right, that's a good way to put it, the way you put it, that this is a tough one, it's not easy.

- Next question.

- I'll try to be brief.

- My question concerns the European countries and their economic crises, and I know you talk a lot about this, and you blame the policies promoted by the EU that focus on austerity, and my question is do you see austerity as the wrong solution, or as the problem, because many of the countries in the European South have had economies that have very large states, very large welfare states, very rigid labor markets, and it seems like these large states have caused the problem, and maybe austerity is a bad solution, but I wonder what you think about that?

- Austerity was not the right thing to do I think, number two, the Euro became a problem, it really impoverished many countries, and the whole southern countries, I remember, I was invited to go to a meeting of bankers in Europe, that's when all the debate of the Euro was happening. And Amartya was the other person invited, and I will never forget what Amartya said at that point, he said, "Look if you're going "to have a European level currency, "and sort of financial market "and key financial institution like our Treasury, "you've got to bring in the labor question." Now the labor question is not just about the individuals who are going to do the labor, the labor question also indicates a completely different set of actors who are going to experience the money question very differently, and that of course didn't happen, so I'm sure that when Joe comes, Joe is the one who recruited me from Chicago, he will talk about the Euro and the mistake, the Euro became a device to concentrate, the Euro is not just a currency, because it comes from the Central Bank after all, and so it became a device to capture and concentrate to the disadvantage of all the countries whose currencies have been much weaker consequences, the Germans were fine, the Swedes they were just partial, but many of the countries who were rich it was fine, for us tourists it's heaven to have the euro, so that is a bit the story. And the whole question of language, how the language of austerity, you know that was a project, and in the global south we had another term, but it was the same thing, It's like really not giving as much to the poorer and the modest middle classes as they used to, there was a post-Keynesian period, well a post-World War II period, generated a kind of generosity, we had gone through terrible things, a kind of generosity, you were enabling, but the economy also was an enabling thing, you needed a lot of workers, it was different from the global economy that really launches in the 1980s, so it's a complicated story, but I hope I answered at least some of what you said.

- [Man] Yeah, definitely.

- [Ilan] Next.

- Hi, thank you so much for giving this talk by the way, my question, I hope I can navigate it correctly, but it concerns coming up with new visions, both in politics and economics. And so just to frame it a bit, it seems like we're at a moment where we have a global capitalism which treats the entire world cynically as a set of factors of production and possible resources, and yet we also have nationalists that are centering all of the attention and power within states, and yet these states are still very supportive of these major capitalist ventures, because they ultimately sustain economies. And I was wondering if faced with such a cynical system, that is only getting further and further worse, and will either see our destruction or complete disposal, should people in their cities especially figure out ways to organize money and political power outside of the state and economic institutions? Then just something to frame that a little bit, Los Angeles, for example, has a very modest proposal for public banking, that's coming up on the ballot.

- I think we need to find, indeed other mechanisms and little institutions, et cetera, one of the projects that I have, the execution happens in New York, is to re-localize what we can re-localize, if you need a computer, if you're going to re-localize you have to take a plane to go to the factory, but Jesus you know, if I need a cup of coffee in my neighborhood, do I really need a multinational to generate that? Because remember every franchise extracts and takes it to headquarters. So it's continuously, these neighborhoods get poorer, the little shops get poorer because if they're part of a franchise, the franchising is a big phenomenon, so again I repeat, if I need a computer, yeah I want a franchise, but for so many other things.

- But isn't that already happening? We see within the global phenomenon, this desire for the local, for something that is authentic.

- Yes absolutely, and in fact in Europe you have a kind of vertical farming, which is good vertical farming, vertical farming is not so great, but doing vertical farming in cities, the Europeans are very good, sort of yeah, we're going to do that, and so you see a move, I think it is a very interesting moment, because we have both very problematic phenomena, but we also have a real mobilizing of young and old people, it's not just the young, I'm old. So there is a sense that things have gotten a bit out of control, so yes I agree with your final suggestion, I wish I could say more, but I see the.

- [Man] Thank you.

- I think we're gonna have, 'cause Saskia has to go to the airport. Go ahead there.

- I learned a lot from what you said so far, so thank you very much. I was at the top by George Will in this series previously, and there are many really interesting differences, obviously, but one that I wanna focus on, is we learned about his background in philosophy, he has a Ph.D. from Princeton in that, and when he was speaking, he returned often to very foundational questions, what are natural rights, what is our country based on, what is a market, he acknowledged many problems in the world, but being a conservative he wanted to really focus on these continuous principles. Your discourse, in contrast, is very piecemeal, and it did occur to me that if we put you back in the 1940s, late 40s and 50s, you'd have no difficulty saying this is unprecedented, there are more refugees in the world than any time in history. I'm reading Tocqueville's Democracy in America, 1830s, he's traveling across America, he encounters slavery, he wrote the longest chapter of his book on slavery, there are problems all the time. I wonder if to use a philosophical term with a little edge, if you could tighten up your discourse a little bit for purposes of this evening, and tell us what do you think is the transformation occurring right now, and what is its general significance?

- Well number one, I think that existing law is insufficient, we have to get rid of some laws, and we have to invent new laws, laws matter because it's a way of governing, which is a bit neutral, which takes a bit of distance from the object, et cetera, et cetera, and that is one kind of issue. Secondly, there is the whole climate change bit, so we need to re-localize what we can re-localize, et cetera, et cetera, these are all elements that we can do. Then there are things that would seem very, very difficult. How can we capture the extraordinary amount, the concentration of wealth, the United States is not the only one, there are many other countries. When we have so many needs, when I look at everything that is the public domain in New York City, it's a bit in shambles, it's degraded, it's old, it's falling apart, the subways are problematic, falling apart to the bit, they still function. So when I think of all the tasks that need to be done, and this extraordinary concentration of wealth. So the fourth element, very speculative, finance makes value, that we call money or whatever, and it's not always. How can we capture it? How can we reroute what is happening? And there are modes in which we can do it, Right now we have money, we can barely collect money it's so much, money has another meaning, it sits, there is too much concentration at the top, we are on the other side of the curve, that particular curve. God, I look at New York City, it's falling apart in all kinds of sectors, so when you think practically rather than theoretically, you say we should do this, we should do that, you know there are a lot of things, are the rich available? In the olden days we had rich people who built the beautiful universities, the libraries, et cetera, can we recapture, I think if there was a moment it's now more than five years ago or six years ago, because there is a real surplus, there is a glut of money, we know certain corporations, they don't know what to do with their money so to say. But how do we mobilize? Now my sense is, back to the other person there, that many young people are far more actively engaged, are far more interested in changing, they believe they can change something. And so at that moment when I look at cities, and I look at different neighborhoods, and how they are mobilizing around, producing collective options, everything very modest. That to me is a very good indication, because there was a time when everybody wanted their own, and this has changed, there's a whole new generation of people they don't want cars, they want bikes, and they also want the green economy, and then a final point, if I look at the long trends in history, how do systems change? How do complex systems change? This is a question that I really asked myself in a really serious way in what I think is my best book, the territory book, Territory, Authority, Rights. and complex systems don't change by changing everything, they often change by shifting capabilities of time one to another systematicity, and my question in the current moment, one of my questions is where is this happening, where can I see this, et cetera, the green revolution, they have names, different names that are grand names, that actually capture little changes, but stuff is changing, but it's not enough, we have to do much more, like Chicago wants all roofs have to be green, the Chinese, you know the new cities they're building they look like a forest, you can barely see the building behind each of these, so the Chinese are way ahead for us when it comes to the environmental thing, et cetera. So my question then is, is the curve building, is it building, or is it hobbling, hobbled, that I don't have an answer to, and now I have to go, I have to take a plane.

- Yes, I am going to apologize to the two other members, because Saskia has to catch a plane.

- Write to me will you, he has my email.

- I want to thank you for coming, and thank you everybody else too for being here, thank you.