Business Elevated Podcast (Episode 47)
This podcast series features business and government leaders discussing what it’s like to live and work in the great state of Utah. This episode includes a conversation between Miles Hansen, president and CEO of World Trade Center Utah, and Dr. Richard Haass, president of the Council on Foreign Relations.
Welcome to the Business Elevated Podcast, where we discuss what it’s like to live and work in the great state of Utah. Did you know Utah is frequently ranked the best state for business by Forbes? This podcast is a production of the Utah Governor’s Office of Economic Development. Thanks for joining the conversation.
Narrator: (0:22) This episode of the Business Elevated podcast is taken from a conversation between Dr. Richard Haass and Miles Hansen from the 2020 Utah Economic and Energy Summit. Hansen is the president and CEO of World Trade Center Utah, and Haass is the president of the Council on Foreign Relations. Listen as they will discuss the current state of foreign affairs and what impact it has on Utah.
Dr. Haass served as the senior military advisor to President George H. W. Bush, the state department’s director of policy planning undersecretary of state Colin Powell, and in various positions in the defense and state departments during the Carter and Reagan administrations. He is in his 18th year as president of the Council on Foreign Relations.
Miles Hansen: (1:13) Before jumping into the current state of foreign affairs, what’s happening in the world, what it means for the United States, and what it means for a state like Utah, let us go over your background. You’ve got such a phenomenal career. And I just, you know, it is you go through the biography. There’s a lot there, and that’s just the tip of the iceberg with the contributions that you have made on the world stage over the past several decades. I thought it’d be helpful for our audience to have a perspective on your background, and share some reflections on your career and the people you’ve had the opportunity to work on.
The first question I’d like to ask is to think back on your career up to this point and think about the various senior-level positions you’ve had in several different administrations throughout that career. What has surprised you the most? What are some good surprises, as well as perhaps some bad surprises?
Richard Haass: (2:05) I think the principal surprise is how little is baked into the cake. How little in life or history is inevitable. But the more you’re up close to policymakers, to a president, and history being made, you realize how much individuals matter, their judgment, their background and what they bring to the task.
In their positions at that time, history would have taken a different road. And what I love about that is the fact that very little is inevitable. It shows what people can do. And when I talk to younger people and students, I often refer to that because it shows there. It shows their ability to make a difference; influence things.
So there’s no reason to sit outside. No reason to be cynical or passive. I think there’s every reason to get into what Teddy Roosevelt called the arena. So I think there’s a chance to make a difference even as a young person. I remember when I was in my twenties in the Pentagon working there. When I was in my thirties working for president Bush, the father, it gave me a chance not just to watch history, but in a sense to participate in it. And I came away from that thinking that people can really make a difference.
Miles Hansen: (3:45) Yep, that’s exactly right. I just finished speaking a few minutes ago to the same audience. And one of the points I made is that it’s easy to think of foreign affairs and national security as a game of risk. You’ve got these different countries of different colors out there on the map.
And there’s these inanimate entities competing against each other. But at the end of the day, we can think about a framework in which countries are advancing their interests, and that’s shaping and influencing their decisions. But at the end of the day, it is individuals making choices that are driving what’s happening out there in the world. And I think that it’s an empowering thought because all of us, within our spheres of influence, can make choices. Whether or not we’re a company thinking about engaging in the world. Whether or not we can travel, we can engage with people with different perspectives from different parts of the world. We have a choice, and with those choices, we can then go out and within our spheres, make a difference.
So you mentioned the leaders that you’ve had a chance to work with. Brent Scowcroft has been a hero of mine for many years. He is a native son of Utah and highly regarded here in the state. He grew up in Ogden, Utah. Just about 45 minutes north of here. And also, Colin Powell is somebody that thinks objectively. And I don’t know if anybody in the United States today says that is anything but a preeminent example of what it means to be a leader.
We share a couple of thoughts. What leadership lessons did you learn from them and others you had a chance to work with? What advice would you give? As we think about individuals here in the room, what lessons from these great leaders will help us think about the decisions that we each make individually or within the organizations that we’re leading?
Richard Haass: (5:25) I was lucky enough to work with both of them and two great friends. Sadly, we just lost Brent. I gave one of the eulogies at his funeral a few weeks ago. He was extraordinary. And Brent was both modest and forceful at the same time. He was modest. He was open to learning, open to listening. Never felt in competition with others. He was mild-mannered and a polite gentleman; he was very strong in his views. But he never let his advocacy get in the way of his job as national security advisor. He made sure the process worked, so everybody else felt they had their chance their day in court.
So there’s this ability to be fair, open-minded, and put them in a position where everybody wants to work with him. It shows how much influence you can have if you don’t abuse or exploit your position of authority. And to me, Brent really lived by that.
I’ll tell you one story.
It was one day we had the large morning staff meeting at the state department. Let’s say the 30 or so senior people. And after everybody cleared out of the room, I said to Colin I was really surprised how you handle something. There was a security problem at an embassy abroad, and things had gone badly, and he was very mild-mannered. He said, Richard, I learned one thing in the Army. And he said first reports are never accurate. And they’re never complete. Don’t react the first time a crisis comes to you, give it time, and ask some questions. Ask people to assemble all the facts and come back in a few hours when they’re confident they’ve got it right. You’ll still have time to respond, but you’re much more likely to be responding against an accurate backdrop rather than something either incomplete or partially false. And, it was a lesson that I listened to and I took to heart; use the available time that you have.
One other thing that you didn’t mention about the 41st president George Herbert Walker Bush. One of the great things about him also is you realize in history it’s not just what matters is what you do. But also what you don’t do and what we don’t do as a country, or what we don’t do as individuals can be every bit as consequential as what we did. For example, his decision in the heat of victory or progress in the Gulf War not to March on Baghdad. I thought that showed tremendous wisdom and restraint.
And I think history has born out the correctness of that restraint. And it’s a good lesson for me. We have a bias towards action. On the other hand, what you really want to do is consider all your options, including non-action, and that there’s no permanent recipe. Sometimes not doing things can be a mistake.
I think, for example, President Obama, when he didn’t act after Bashar Al-Assad used chemical weapons, crossing the red line. So inaction can be, I believe, wrong at times. But I also thought that President Bush showed the value of what you don’t do. And all I’d say is when any decision-maker in business and personal life and government has a range of options, he or she ought to look at inaction with every bit as much rigor and scrutiny as they look at all the choices of doing something.
Miles Hansen: (8:54) And that’s easy listening to you. A few words came to mind, humility being objective, being strategically patient, and being good at being a coalition builder. And thinking about building coalitions, as we think about the world of foreign policy and the history of the past few decades, the coalition that you were instrumental in building following Saddam Hussein’s invasion of Kuwait is one of the best examples of coalition-building in modern history.
Countries from around the world taking advantage of the end of the cold war to come together in collective action to push back against an egregious act that Saddam Hussein committed against another sovereign country against Kuwait. Could you give us a little bit of color around that effort of that effort to build coalitions?
I’m thinking about it in the sense of at that point in time there was talk of a new world order. This optimism that we’ve gotten beyond this bipolar world. We all can come together to take collective action. And if you think about the sentiments, the rhetoric, the action that was taken at that point in our nation’s history, and you contrast that with where we are today, it’s hard to find a more sharp black and white contrast where we were then, where we are today.
And so are there any lessons there? How did you go about building that coalition after Saddam’s invasion of Kuwait? Any insights you have there? And then perhaps if you could contrast that with where we are today. Why is it so hard today to do that type of coalition building on the issues that are facing each country? And we’ll talk about a little bit more in-depth here in a few minutes.
Richard Haass: (10:44) Let’s unpack there in terms of coalition building at the time there are some valuable lessons. One is; you don’t wait until the crisis emerges to start building your coalitions. You’ve got to invest in relationships. One of the things 41 was good at is he called people and built relationships when he didn’t need something from them. It’s like putting money in the bank. Then when he needed to make a withdrawal, he already had a balance. He had some capital there.
So when Saddam invaded, that wasn’t the first time he called these people. It wasn’t the first time he had a discussion about a strategic challenge. So that really helped. Also, you have to be willing to compromise when you have somebody like Jim Baker as the point person in coalition building. You have to decide where to give. You’re never going to get 100% and you’ve got to decide what are the things you can afford to compromise on and in pursuit of the larger good. Baker had just tremendous instinct on where to give ground and where to hold firm. He constantly worked at building coalitions and relationships. You’ve also gotta be willing to tailor them. It can’t be one size fits all. You got to take people’s domestic circumstances into account and what they have to bring to the party. And one of the things Scowcroft, Baker, Bush and Bob Gates is they were good at not insisting that everybody do this or that.
And I think all of this shows that there’s nothing the United States can do in the world alone, that it does better with others. Coalitions are a force multiplier, and the great advantage of American foreign policy is we get up in the morning, put our feet on the floor and there are several dozen partners and allies around the world who are essentially inclined to work with us, be it against a regional challenge or some global issue. And that’s the great structural advantage of American foreign policy. During the cold war the Soviet Union had no such countries. It had coerced compliance from the members of the Warsaw Pact, but we had voluntary support.
And coalitions, and NATO and in Asia and elsewhere. So that gives us real partners and tries to encourage some outcome or discourage another one. I think now we’re making a big mistake to see allies largely as a competitor is losing sight of the big picture to think we can do better unilaterally then multilaterally. I think it is just flat out not supported by history. Don’t get me wrong; we’ve got to forge each, coalitions that are task-specific. I don’t think anybody should have this image of a United Nations general assembly in his or her mind. That’s amazing is not serious multilateralism but I think we’re going to have a different cast of partners for each challenge we face.
If you want to deal with global health, you may want certain governments. You may want the World Health Organization, you may want the Gates foundation, you may want several of them. If you want to deal with the internet, you may want to have certain like-minded democratic governments. You’re probably not going to have Russia or China, to say the least, working with you. But also you may want to have some of the IT companies, whether it’s Facebook, Twitter or the Google alphabets, Microsoft’s. You’ve got to cast your coalition and you and be task-specific.
And I think that’s the future of foreign policy if we’re going to be effective.
Miles Hansen: (14:31) That’s thinking about that process. Right now, I think there’s a lot of Americans. A lot of people here in Utah are frustrated at the political dynamics in Washington, D.C., and there’s so much gridlock. It seems like it’s very difficult for different factions, different parties, different sides to come together and go through a healthy debate.
You go through the process, but do they need to come up with a policy? And then you go ahead and execute that policy. My mind a lot is this idea of tribalism. Now that we have this increase in nationalism, but at the same time, you have an increase in tribalism groups within nations that are fighting against each other that gums up the policy-making process to make it more difficult for countries to come up with a coherent strategy.
Could you comment a little bit about the political or the policy process in Washington, D.C.? What changes would you advise either a second-term Trump administration or a first-term Biden administration to make when it comes to foreign policy and how we craft our national security and execute that so that we can be more effective at coming up with a national strategy bringing together different groups and then going out and executing a more coherent strategy on a global stage?
Richard Haass: (15:49) We’ve just talked about the importance of being willing to work with others around the world rather than unilateralism forms of effective multilateralism. I also think being on the playing field is better than not. I don’t think this pattern of withdrawing from agreements or institutions, by and large, enhances our influence. I think it diminishes our influence. I understand, at times, the temptation to withdraw from flawed institutions. My reaction is all the more reason to be there. If they are flawed, then try to fix them unless you’ve got something better to put in its place. I’m not a big fan of leaving the field to others just enhances the influence, say of China or somebody else who’s not interested in our interests.
American political dysfunction here at home has been a growing reality for decades. It wasn’t invented in the last few years, and there’s all sorts of reasons for it. The way we fund our politics, the weakening of national political parties, and the way districts are drawn up for the house of representatives.
I think social media has reinforced what you correctly called tribalism. Cable television reinforces it. When I grew up, there were essentially three networks, a couple of nightly news shows and the media was more of a force that brought Americans together. We tended to have a common experience. We don’t have that anymore. Schools, to me, is one of the real problems. We don’t teach civics in our schools in many cases. We can agree on what a civics curriculum should or would look like. Many young people leave universities after two or four years and don’t have a basic understanding of their own democracy or the world under their belts. And I think the real lesson from the last few years is that we shouldn’t just assume that our democracy’s resilience and robustness of our democracy is a given. I don’t know what’s going to be the configuration of the Senate, much less the occupant of the White House and so forth.
Let me put it this way. Miles, you can choose a lot. When you run for president, you can choose your running mate. If you win, you can choose your cabinet. The only thing you can’t choose as your inbox. And the one thing we all know is the inbox, whoever is the occupant of the oval office come January. That inbox is going to be daunting.
An array of international challenges. China, Russia, Iran, North Korea, climate change, COVID-19, millions of unemployed, racial divisions, political divisions. I don’t think we can thrive as a country. We can’t even succeed as a country if we don’t begin to heal some of our internal divisions. We can’t be effective in the world. If we’re divided at home, we won’t set a good example for the world. We have got to revive our economy. We’ve got to deal with inequality. We’ve got to make opportunity a reality rather than just a slogan. We’ve got to improve our public schools, our infrastructure, our immigration system. It’s a long list.
None of these things will get done if we are politically divided. We’ve got to somehow figure out how to generate, once again, a spirit of a degree of compromise. I’m not talking about compromising your basic principles, but you never get 100%. We have got to build a willingness and an ability to compromise if we’re going to address these national concerns, which are not getting better on their own. I think we were paying the price that we’ve not tackled a lot of our growing domestic challenges now for way too long.
Miles Hansen: (19:37) That’s one of the things I love about being here in Utah. I came back to Utah a couple of years ago. I was working in Washington, D.C., at the national security council before that, and a lot of different countries in the Middle East and the former Soviet Union. But coming back to Utah has been a breath of fresh air for me because here in Utah, we know how to come together.
We properly apply pragmatic principles, and we prosper because of that. The left and the right come together, and you get the same political dynamics. You get anywhere else in the world. You go through elections, and it’s tough, and you go through this process. But at the end of the day, we get to that political process. We end up coming up with solutions. In my mind, that process becomes constructive and you end up with policies that are better than what either side started with at the beginning. Whereas what I experienced in Washington, I think what we’re all observing from afar here in Utah, is that the process in Washington right now is destructive.
It feels like that if a policy comes out, it often seems more watered down and less effective than what either side started with. And that’s a broken process, and it doesn’t bode well for our country. We all hope that perhaps you talk can be an example of how you can come together to tackle issues like immigration, climate change, taking care of our environment, balancing free trade with fair trade and these issues. In Utah, we are taking a very pragmatic and constructive approach to figure out how we are going to engage.
Richard Haass: (21:08) One thing I think what you’re pointing to is an important point that often at the state and urban and local level you can accomplish things that you can’t at the national level. In part, I think it is because people working at the state and local level are often held more accountable. And I think what you’re describing is welcome, but at some point, it’s not enough. Utah can’t run its foreign policy. You can’t do certain things of scale, and that’s why we still need effectiveness at the national level. A former Supreme Court justice once said, it might’ve been that the States are laboratories of democracy.
And it’s the states where often you see social innovation and public policy innovation. And I think that’s probably right. But then what we really want to see are those innovations Utah demonstrates. We want to see them get on the highway and have other states, or better yet, the federal government pick up on them. Because that’s the only way to operate that scale in a country of 325 million people. So we still desperately need to fix Washington. It is important that states and cities do what they can.
Miles Hansen: (23:25) Yes. I agree100%. Let’s spend a couple of minutes talking about that presidential inbox. As you think about January, a second term or a new administration coming in, what are two or three issues on the international landscape that you think will be the most consequential for the United States over the next four years?
Richard Haass: (23:50) Let me just give you three broad-stroke issues and drill down wherever you want. One is how are we going to deal with their return of great power rivalry? You mentioned before the new world order and all that 30 years ago. Well, we have a toxic relationship with Russia and an increasingly friction defined relationship with China.
How are we going to be able to figure out? How do we push back with either where we must? Be it over their external behavior or their internal behavior, yet still preserve the possibility of limited cooperation where it’s in our interest to do. With Russia on nuclear arms or with China on climate or dealing with the North Korea proliferation challenge. I would say that’s one set of issues. How do we handle the revival of great power rivalry?
Secondly, it’s all these global issues, global public health, infectious disease. How do we deal with proliferation? How do we essentially repair the global trading system? How do we try to regulate the cyber domain? It’s a long list. But in every one of these areas, there’s a pretty healthy gap or unhealthy gap between the scale of the global challenge and the scale of the arrangements in place. And as we were talking about before, if you can’t fix it with a single institution, a universal institution that resembles the general assembly, what can we do? What can we do with more selective multilateral initiatives to try to narrow the gap between these global challenges and responses?
Thirdly, we’re going to figure out how to do all these things against the backdrop of a country in difficult straits. Given COVID, given unemployment, given the divisions politically and racially. We tend to our domestic ills without turning our backs on the world. We don’t have that luxury. The whole lesson of COVID, in some ways, is what happened in Wuhan. It didn’t stay there; nothing stays local for long. So we can’t basically go to the world and say, “Hey, we need a few years as Americans to sort ourselves out, give us a little bit of time. We’ll fix ourselves. Then we’re going to come back.”
History doesn’t work that way. So we’re going to have to figure out, whoever wins, the election is going to need to figure out how we address our domestic ills, and there are many. And I think getting that balance right, and selling that to the American people will be no small feat.
Miles Hansen: (25:33) Let’s drill down on just a couple of specific issues you touched on there. Let’s talk about China first. Utah and China have a surprisingly long and angling close relationship. You know we had a lot of Chinese rail workers who came to build a transcontinental railroad. Of course, that work was completed in Utah. And a lot of people stayed and saw from very early on you had a strong Chinese community here in Utah. Fast forward several decades, 1930s, Helen Foster Snow was born in Cedar City here in rural Utah. She went to China, and became a very prominent journalist. They captured her and wrote a lot about the communist revolution in China and she became a very prominent person. There were statues of Helen Foster Snow throughout China, and that created this heightened awareness of Utah in China.
Several decades later, in 1979, Brigham Young University had a phenomenal dance group. The Young Ambassadors go and they perform across China. At that point in time in China, there wasn’t a whole lot on television. For years you had these reruns of these Utah students performing these either these Chinese cultural dances, played again and again, all across China. Again, creating more awareness about Utah than what we deserve as a small state in the United States.
Jon Huntsman was governor in Utah. We now teach all the Mandarin immersion taught in the United States today; 20% of it is taught right here in Utah. My nephew goes to school in Mandarin, starting in kindergarten. He learns science and math and other things in Mandarin.
So when these kids graduate high school, they’re just about as close to being fluent in Mandarin as you can be without being a native speaker. So think about that, a state with less than 1% of the population teaching 20% of the Mandarin immersion. And so you had these strong relationships between Utah and China, and that translates very much into our international business, our trade in exports and imports.
And yet at the same time, you have an awareness of the growing concern of Chinese behavior. Whether it’s how to treat Uyghurs, whether it’s things in its South China Sea, and expanding their sphere of influence. We have an equally strong relationship with the Taiwanese community here in Utah. And so you have a lot of growing concern about the challenge of China. And I find myself in this constant balancing act.
How do we think about these people’s ties to build them, to strengthen them in a way that makes sense that binds us together in a way that’s productive. Well at the same time, helping companies and others here in the state be very clear-eyed about the challenges and the nature of the relationship.
And to be frank, Richard, I don’t know if we ever strike that balance correctly. I would be very grateful for your perspective about what advice you would have for me about how the World Trade Center Utah is leading out on this international business development for the state of Utah. Also, for the many Utah companies and institutions here that are trying to find this balance between maintaining these strong people to people ties, but taking into account their very real concerns that a lot of Americans have about Chinese behavior that is counter to U.S. interests.
Richard Haass: (28:56) You’ve described the dilemma or the challenge accurately, and like most challenges or dilemmas, you can’t resolve it, at best you manage it.
I believe in the people-to-people thing, even though it’s not a substitute for the government-to-government side. And I think we’ve got to recognize we’re going to have real problems with the governmental level over economic behavior. You mentioned things like intellectual property theft.
We’re going to have it over human rights. The Uyghurs, Hong Kong repression within China across the board, we’re going to have foreign policy over things like the South China Sea, Taiwan, what’s happening on the border with India. So, as I said before, what we’re going to have to figure out is how do we push back in all of those areas, without ruling out the possibility of limited cooperation where it shouldn’t. It’s in our interest to do that. I could think about that with Afghanistan. I could think about it with North Korea. I could think about our climate. I could think about it on global public health challenges and economics.
We can’t decouple from China. Economically, China is too large. It’s too integrated with the world, but we are going to have to probably carve out certain areas which are no go zones dealing with certain technologies. We are going to have to protect them. So I think we have to understand that it’s not going to be an all or nothing thing economically.
It’s going to have to become more selective where we’re not going to use Chinese systems to transmit our data. So that would also require our having a viable alternative. We’re going to want to become slightly more self-sufficient with some of our supply chains, slightly more careful with certain technologies, and so forth.
But again, it’s not all or nothing. And also, it’s not just us. This is something we need to do in concert with our principal economic partners in Europe and in Asia. I think the concerns you raised are not limited to Utah, not limited to the United States. I think they’re widely held in Asia and in Europe.
So I think we have a lot of partners who want to work with us and come up with the rules of the road for dealing with this incredibly important country. It’s the world’s second-largest economy, what it does and how it does it will have all sorts of implications not just for the region, but for the world.
And a lot of history is going to be determined by U.S. and China relations. I also argue for the next administration, whoever it is, really making this a priority. We have very little private, serious conversation with China. People use the phrase from your time in government of strategic dialogue. We haven’t had a strategic dialogue with China in years. We do not sit down at an authoritative level in private. Working out the rules of the road of this relationship we had better. There has got to be a better understanding and also accept certain realities. When I hear the secretary of state and others talking about regime change in China, effectively getting rid of the communist party; that’s not a viable U.S. strategy. We’ve got to deal with the China that exists. Not with the China some might prefer. So I think we have to essentially have a realistic policy towards China. One element I would argue is to resurrect a serious regular conversation between our two governments. So you can have the people-to-people; maybe this betrays my own background. That’s a compliment too, not a substitute for the government.
Miles Hansen: (32:32) That’s exactly right. The nice thing about here in Utah, we don’t have to deal with national security or foreign policy because that’s not our job, it’s the federal government’s job.
And so those very real contentious issues are something that our national leaders need to be thinking about engaging in. But what a state does in my mind, you build relationships around trade and investment, education, innovation, sports, arts and cultural events. And those become that fabric and that ability for the United States to project our soft power through these informal people-to-people ties. It’s not a substitute for the very hard power and the real politics and the diplomacy that has to take place on a national level.
I liked how you talked about partnerships. This strikes me as an issue where coalition-building becomes increasingly important in the years to come. Not only with other states that are like-minded and have the same concerns with China, but also on those global issues where we have an alignment of interests. It doesn’t have to be all or nothing one way or another.
In our final few minutes, rapid-fire, two more global issues I think are very important. One is climate and the other is trade. I’d be curious to hear your thoughts first on climate. Last week, I joined with a 150 business community and government leaders from across the state to sign the Utah climate and clean air compact. We all agreed to be stewards of our climate to work towards adhering to certain principles that will help the climate. Here locally, we push back against the degradation of the environment and make sure that we are doing everything we can to support clean air. As we continue to grow very quickly, clean air here in Utah is a major issue. If you look at the signatories, it’s the people from the entire political spectrum coming together thinking about a common problem. Like you pointed out before, what we do here in Utah can be beneficial for us here in Utah.
What do you think about climate change? You got the Paris agreement in large international and multilateral efforts to come together and make commitments. Thomas Friedman joined us last week and talked about the need to use the market to bend things using market-based forces, and he was pretty skeptical of the Paris agreement and multilateral institutions to be able to combat this. What would be the two or three courses of action you think are necessary for government and private institutions around the world to do their part to try to do some sort of collective action towards pushing back and being good stewards of this world?
Richard Haass: (35:30) Let me just start with your last point. God created the heavens in the earth, and I really do feel we are custodians or stewards, and we have a responsibility not just to ourselves but to future generations. This is an issue that I hate has become partisan. It’s something that affects all of us. And by the way, it’s affecting us now. It’s a growing concern. It’s another sign that that happens in the world matters.
Climate change is the cumulative effect of what is going on everywhere. Whether it’s going on in Brazil with the rainforest or China with the use of coal. I agree by the way that the Paris Climate Accord is not the answer. I’m fine with getting back in as a kind of symbolic move, but we shouldn’t kid ourselves.
There’s not going to be a top-down one size fits all quote, unquote solution. I think there are going to have to be market things. Rather than seeing a responsible climate policy and a growing economy as an opposition, I think increasingly there in tandem. And I think there’s all sorts of areas of green technology or things like automobiles that get higher energy, standard standards and so forth that are responsible for climate and good for jobs.
I know you’re interested in melding trade concerns and climate concerns. One of the things I would love to see the next administration do is get the United States into what was the Transpacific Partnership. And the grouping originally was going to be 40% of the world’s economies we pulled out and so that was reduced by half. I would like to see that become not just a trade belt block but a climate block. And imagine if we could get people to agree to say if you want to sell cars to us. they must have mileage standards that are above a certain amount.
If the mileage standards are below that amount, you’ll have to pay a certain tariff. Or if the goods you want to sell us or produced with certain types of energy sources, you’ll have free access. If however, they’re produced with coal, you’ll have to pay a tariff. With Brazil you would go to them and say, look, one-fifth of the global climate challenge is going to be determined by what happens with the rainforest.
We have a responsibility to everybody. If you’re willing to act responsibly, we will help you be a custodian. However, if you refuse to act responsibly and meet your obligations, here’s the sanctions that are going to come your way. So I don’t think there’s a universal approach to climate, but I think we’ve got to make it a priority, and we’ve got to look for various mechanisms to promote the outcomes we want. And again, this idea that somehow if you’re responsible for climate change you don’t care about American economic growth. That mindset really needs to change.
Miles Hansen: (38:30) A concluding question from me. It feels like we have this growing protectionist sentiment here in the United States. In Utah, trade is so important to our economy. One in nearly four jobs supported are by trade. An astounding amount, about 85% of Utah’s exports are small businesses. And trade exports generate more than $5 billion in additional revenue every single year for these small businesses alone. So Utah’s highly integrated.
We’ve had the highest export growth rate in the nation for the past two years. And yet we start to see protection of sentiments building up here in the United States and in perhaps in other countries as well. The prospects of this free and open system of trade that we had that created so much prosperity over the past 75 years? What are the prospects in the next five or 10 years? And what advice would you give to companies here in Utah that are continuing to find ways to go out there to compete and win in the global marketplace?
Richard Haass: (39:33) I am a believer that the value, the upside of trade is far greater than any downsides.
I think we have to recognize though, that certain people do pay a price for free trade. What they’re really paying a price for is technological innovation. Productivity enhancements that eliminate jobs. Whether it’s in Utah, the other 49 states, or at the national level, we’ve got to be much better at retraining and re-skilling our workers. It’s inconceivable to me that someone at the age of 22 or 23 when he or she graduates college that their first job is going to be their last job. They’re going to probably have 10, 15, 20 jobs in the course of their life.
What we need to find is a way that one they’re able to re-skill, retrain, and so forth. They have their transitional economic assistance, the healthcare they need. So they have the mobility that’s going to be essential to live a 21st-century life. So that’s one thing we’ve got to give people the capacity to deal with the fact that jobs come and go. Trade then becomes really important while we’re just coming out of the recession caused by the pandemic. I think trade has the potential to be a real locomotive for American economic renewal. So what we want to have is more free trade that’s why I would love to see the United States in the transpacific partnership. I would love to see the expansion of the USMCA to other parts of this hemisphere. Maybe not exactly the same rules. Maybe there’s a modified set of rules for others in the hemisphere. I would like to see the United States rather than trying to undermine the World Trade Organization. Let’s reform it. I think it’s really powerful.
Create a legal adjudication panel to deal with trade disputes. By the way, we’ve won most of those we’ve contested. I think we should look again at how to improve that mechanism, how to increase the areas of trade that the WTO covers. I’m open to other regional deals potentially with the Europeans. I think we have to understand that trade has a positive dynamic for American consumers. It keeps inflation down, improves choice. You mentioned all the people who are involved in export did a great job generator. It could help us cope with the environment. I understand this national security dimension, so we have to protect certain technologies, but we’ve been doing this for 75 years.
We know how to conduct, rate and protect American technology. So I don’t see it as the kind of choice we have to make social. And one other thing, I also think there’s an important developmental side. If people are worried about China’s influence in the world one of the ways we compete is with trade. This is a way to increase our connections with the rest of the world, particularly the part of the world which has the fastest population growth over the next 25 years, which is Africa. There’s going to be a billion more Africans over the next 20 to 30 years. So this is the area we can produce so many goods from a humanitarian level to an economic level, to a strategic level. And I think we’re short shortsighted if we don’t take advantage of this important tool.
Miles Hansen: (42:49) Absolutely. One thing that I say a lot, and it’s true, is that Utah’s economic recovery and the same is true for America’s economic recovery, runs directly through global markets. And right now there is an unprecedented disruption in global markets and an opportunity for Utah companies and American companies to go out there and to take advantage of that, to increase our prosperity here at home and for individual companies and individuals across the country and across the state.
Richard, thank you very much for being with us today, to everybody who’s listening in. I highly encourage you to go to the CFR website. It has phenomenal resources there every single day. You can sign up for a daily email. They help you to be smart about what’s happening out in the world and to participate in this organization.
That truly is the best organization in the world to serve as a resource to help people better understand the world and foreign policy choices. Check out Richard’s book: “The World: A Brief Introduction.” It’s a phenomenal primer. It’ll help create a framework to better understand what’s happening in the world. It will also help you make smarter decisions either as a company, an institution, and even as individuals.
Richard, thank you for spending so much time with us today. We are grateful, and we look forward to hosting you here in person as soon as we possibly can.
Richard Haass: (44:07) Thanks. My friend, I look forward to it as well. In the meantime, you stay healthy,
Miles Hansen: (44:11) You as well. Thank you.
Thanks for listening to the Business Elevated podcast, a production of the Utah Governor’s Office of Economic Development. Listen to other episodes where you get your podcasts or at business.utah.gov.