Bloomberg Businessweek Weekend - November 2nd, 2019

and stories you need to know about. It's a primer for a big event coming up later on this month. It's the second annual New Economy Forum. It's going to be held in Beijing, a gathering of world leaders of business leaders really in the business of problem solving. So we have all of that to cover this week. Also, we have a couple of stories we've got to point out, including one on Christine Legarde. She takes the reins this week at the European Central Bank. We'll hear what that

means for the Central Bank. She's going to be a different type of head. She brings different skills to that job. Exit Druggi Enter Leo Guard couldn't have two different people cast in this role in a lot of ways. Eager to see what she makes of this, and you bet address right, that's very good point. First up, though, we speak with the editor of the special issue, Christina Lynn Bled.

She oversaw all of it really stitched together, what's happening in this new economy and how she put it all together. I think about this this issue all year long. It's it's a great repository of stories that we might not be able to do that the rest of the year because we have, you know, certain sections, and they don't some of these issues don't fit very well within those sections well. And speaking of repositories plastics, we're not talking

about credit cards here. We're talking about actual plastic being used to pay for things. Wait what. The Plastic Bank is a project that started with this entrepreneur in Vancouver and the first one opened in Haiti, and we visited one in Bali and Indonesia that opened recently, and basically the idea is to make plastic worth something and that

give people an incentive to not throw it out. So um. Basically, we talked to people there who you know, supplement their income by collecting plastic and redeeming it at the plastic bank. The plastic Bank had IBM built them a sort of like e wallet app that like people can use to track their income and their savings. They can also use those, uh those credits that they have and redeem them at certain stores. So for example, somebody can earn like seven

dollars a month. That does not seem to sound like a lot in the United States, but Indonesia is a country where GDP per capital is only three thousand something dollars a year. How isn't it fascinating? Just kind of it sounds like such a simple solution to what's kind of a big problem, giving people kind of a financial

identity as well as solving a pollution problem. That's right, because I mean the idea is also that they're almost like these countries have a huge number of unbanked people, and so this is basically training people in the idea of like what are savings? You know, like this, we could talk to one guy who used to say, I used to go out and spend all the money like I got because he used to go to our recycling center and redeem the plastic and just get paid, you know,

right there. But now he sort of has an incentive to save it up. Another big story that is in the magazine and looking at it from a global perspective, is immigration. And what I love about this story there's been such a pushback against immigration by so many different countries around the world, and yet a lot of countries need it because they need workers. Well, this is a project that I desperately wanted to do, and this is an example of something that would have been sort of

where do we address this? But I thought we have one of those sections of the issue's governance, and I thought, what is something that that needs really good policy? And it's sort of this movement of people which has become such a hot political issue, but it really it's it's imperative for certain economies to keep you know, to keep immigration alive as a as a you know, it's a necessity, right, So it's like, how do you make it work for you?

So we looked at three different examples, and I think Canada is one of the most interesting because it has this system that takes in economic migrants, so not political asylum seekers or anything else. But so if you're applying as an economic migrant Canada, you're going to get scored on several criteria. One is your skills, your education, your past work, not performance. I'm sorry, you're you're like your resume,

what kind of jobs you've had. Language, so the national languages of Canadas, of French and English, and that score is going to determine basically whether you're being you're going to be offered permanent residents. And other other countries are looking at this program, right, So New Zealand and Australia have I've already adopted. Their programs are modeled on on Canada's and the US. There's two legislators to Republican legislators who have proposed as part of a big reform and immigration.

And what's cool about that story and people should definitely check it out is you sort of give it some sweet but then you have some personal examples as well. Let's talk about climate, because we talked about it here a lot like Bloomberg. There's a whole effort in the

news room. You look at it through one river, tell us about right, So we went to a river that runs through several countries in Southern Africa, and we chose Southern Africa because it's one of the most vulnerable places in terms of um Basically people and governments do not have the money to spend in mitigation. So we looked at in this river, the Zambezi, which starts in Zambia

and winds all the way down to Mozambique. The interesting thing is in the north the problem has been drought and in the south there have been two floods and cyclones. So it's basically the story of wacky weather and how

it plays out for these communities along the river. These are important issues, and these are global issues, and you guys tackle it so well in the magazine, Christina, thank you so much, really appreciated Economics editor Christina Linn blad O. We're seeing the economic and really this issue and that's Christina Lynn blad You know, she's a frequent guest of ours, frequent collaborator in many ways. And this was a tough assignment, I think, because how do you really get your arms

around this new economy right? And she just and she looked at so many of the important issues that will be facing the global economy in love checking in with her. In late November, Bloomberg will host the second annual New Economy Forum in Beijing. It was established in by Mike Bloomberg, of course, the founder of Bloomberg LP, home to Bloomberg Business Week, Bloomberg TV and Radio. And here to tell

us more is Andy Brown. He is the editorial director of Bloomberg New Economy, a frequent guests a weekly guest on our daily radio show, Bloomberg Business Week, so we get a chance to chat with him all the time. But it felt necessary and important to have him set the stage for this big event that's coming up. So Andy, help us understand why now, why they're and what people

can expect to say. You know, the big narrative behind the New Economy Forum is the reality of a global economy in the throes of profound, wrenching and highly disruptive change. And by and large, this change is being botched by global institutions, national governments, global leaders. And we believe that it is crucially important to put businesses in a room together with governments to start talking about these issues um that are threatening to pull upon the global economy, public

private partnerships discussions exactly. So the starting point is to get the right groups of people together and then to curate conversations in a way which will produce results. We want productive conversations. How for two it is that you're in Beijing. Considering the backdrop, Like Jason, I've been talking about this with everything that's been going on, but specifically with us in China, but just everybody focused on China right now, it's highly symbolic that we're in Asia. We

launched the event in in Singapore last year. This is the second year we're going to be in in Beijing. We talk about transitions. Of course, the biggest transition in the world today is the shift in wealth and power from the globalized global north of the planet, from the west of the planet to the east. And so we felt it was really important to host this conversation in a part of the economy, the global economy, which is you know, really going to be the future Asia, Middle East, Africa.

This is where the global growth is coming from. And getting that relationship right between the old economy focused on you know, uh, the industrialized North and the emerging economies of the global South is critical. We talked about the global economy, and yet we have spent a lot of time with you talking about decoupling and and that certainly

is part of the backdrop here. Amid not just the ongoing trade discussions, but the day to day decisions that companies are making about their supply chains, about where their customers are, how they're going to even manufacture their products. Help feather that into some of the discussions you plan to have. We're looking again, we're looking at transitions, and we we we we were stumbling towards global catastrophe in a number of areas. I mean climate obviously, but not

just climate. Um. The global trading system is folding upon. Global central banks have run out of ammunition to fight the next financial crisis. You mentioned US China. Uh, these two countries have failed to invent a new form or a new foundation, um for a relationship that once seemed so perfectly symmetrical. You know, and with the China that's all grown up now and it's all and it's all grown up and and and and and this symmetrical relationship.

You know, America invented, China innovated um. You know, America consumed China produced. I mean, it all fit together so well, it was complementary, and it is now fundamentally competitive. Both countries are going after the same thing, which is dominance in the industries of the future, artificial intelligence, quantum computing, robotics. The problem is that these areas are all of them dual use civilian military, and so the economic competition bleeds

into security and military competition. They need to figure out a new way of managing this competition. This is one of the conversations, a critical conversation that we're going to be having a new economy. Well, and what's interesting is and and maybe this is being too clever by half, but it feels like there's difference between being competitive and

adversarial in a lot of ways. And you do wonder from the headlines and the rhetoric, even just what we've heard recently from Vice President Mike Pence as to whether the tone has shifted in a meaningful and maybe not permanent, but certainly secular versus cyclical. Well, you mentioned Mike Pence.

I mean, he he gave this storming speech, uh this time last year, UM where he essentially at labeled China an adversary of the United States, and he took China to task over everything from human rights to the way it rips off um. You know, American I p forces technology transfer and so the Chinese read this not inaccurately as the first shots in a Cold war. Um. So this this relationship, yes, is moving definitely towards an adversarial one. And and and and really it would via completely out

of control. We're right, We're right on the cusp now the two sides. And I mean this is this is the sort of the proximate background to the New Economy Forum where you had this this trade wall which looked as though it was going to rage completely out of control, damaging both the US economy, the Chinese economy, and the whole global economy. I mean, you know, the the global economy really is right on the cusp of recession. On the IMF keep lowering their their forecasts for for global growth.

We have a truce that that it seems as though we're going to have a truce, a mini trade deal, the purpose of which is not to fix all of the problems, which can't do, but is to prevent things from getting any worse. What's the goal? What do you hope that by the end of the New Economy Forum that countries companies, what the next steps that they might

take the substance of our discussion. You see, we we um we we look at the global economy in in pill is right, so trade, finance, and investment, technology organization inclusion, and we look at each of these as a series of transitions. So if you take technology, obviously we're moving from a four G world to a five G world, which will power all the industries of the future. Now you know that that is accompanied by huge geopolitical tensions between the US and China, focused on the Chinese gear

company Huawei. UM. So, the the substance of our conversation that include including climate, um you know, is is what are the institutions, what are the policies, what are the norms, standards, rules that that we need to manage this these transitions in a more rational and a less adversarial way. That's Andy Brown, editorial director of Bloomberg New Economy and Jason We're lucky we get to check in with him every

week on our daily radio show. And you know his vantage point having lived overseas in Asia, it's really been um so notable and so important, especially when we've been talking a lot about US China trade. But this is his issue. Well, that's exactly right, And what I love about him is when we sort of get stuck ourselves trying to understand what are the nuances of Hong Kong protests, what are the nuances of this trade war? He really

delivers for us. This week, Christine Legard takes over as the President of the European Central Bank, it's first female president. She inherits a few things and also brings with her a different skill set than many of her predecessors. Jason, this is a really important story because I think it's going to set the tone in many ways for what the European economy looks like. But also this is one of the best known leaders financial leaders in the world.

Jana Rando joins us from Frankfurt. She's got the story on Madame Christine Leguard, So tell us what Madame Legard is looking at as she takes this new big job. She has a lot of challenges um to tackle. She takes over the CB at time when the economy is not doing really well. We're in a slowdown. Germany, the largest economy in the region, probably is already in recession.

Inflation is very low um, monetary policy at the ECB is very expansionary, and there is quite a big rift in the governing council as to UM what could be done as to the policies that are needed, uh to

overcome the situation. There was a big debate over the last stimulus push, and she comes in at a time when all that needs to be fixed well, and there's frustration right among the ECB policymakers about what the e c P e c B excuse me, is doing and versus what policymakers in the region are doing or should

I say not doing to help out the economies. Yeah, policy makers at the ECB have really stepped up their call governments to do their part to use fiscal space, to to implement fiscal stimulus where they have room to do so, to implement structural reforms to boost growth potential in the region. And so far our governments have taken very small steps towards that. They have signaled their willingness also in Germany, but not nearly enough as some of

those policymakers would like to see. I think one of the things that I'm interested in and I think Jason, we've you know, very often here at Bloomberg talked with UM Christine Lagarde. She's going to be a different type of leader, and her priorities are going to be different, and she's also not someone right who's an economist that comes to this job. Ja No, And I think we talked about her appearance in sixty Minutes here the United States a couple weekends ago, and just sort of the

tone that she's going to set. And if you were to cast two people, you couldn't get more different in many ways than Mario Draggy and Christine Lagarde. How is that stylistic difference going to play through, Jana? I think she comes at a time when her skills are desperately needed. She's a very good communicator. She knows how to reach out to the people, how to talk to the people, which is something that Mario Joggy, despite all his economic brilliant hasn't really done a lot over the past couple

of years. So um to come in now and to to go out to the public and explain why that monetary policy, that expansionary monetary policy that reduces interest on savings is needed, that is very important. She's also very interested in social changes, in climate change, all those issues that are at the heart of the debate at the moment. At the moment, so we can expect to hear from

her on those issues as well, um Mario dragging. On the other hand, stellary economist with impeccable training, UM, that is something that she doesn't have, but she can rely on on the e CB staff and she has a lot of experts there as well well. And it's so interesting that you talk about her experience and her experience versus drugs, and I think two things come to mind.

One is she's been in the belly of the beast, as it were, in Washington, but also at the i m F very concerned with developed in economies as well as developed economies. Of course, what is her latest job her previous job, I should say, going to help her

bring in terms of her scope of the world. She's used to dealing with people from a lot of different backgrounds as you mentioned, emerging markets, developed nations, UM, political leaders, economists, financial leaders, UM, and and all that experience she brings to the c B where you have just policy makers,

but also from very different backgrounds. If you think about UH policy makers from Germany and Swiedmann, who is a very traditional conservative official, where you have people from from the Southern States, from Greek Italy which prefer generally loser monetary policy, have different views on on fiscal policy as well, so it's a very diverse crowd at the c B, which is why we see some of the problems some

of the arguments play out in the public. And I think she will she will bring her skills to the table and we'll be able to forge a compromise there. And that's Yana Randall joining us from Frankfurt. I loved this story because Christine Lagarde. In many ways, there's not many people who are better documented as a world leader than Christine Lagarde, because she has been such a prominent woman on the financial landscape. Everybody's written about her, talked

about her. But I really felt like there were some new insights here. Yeah. Absolutely, and that's what's great. It's not only what she's done professionally, but some insight into who she is as a person. And I love that she's not trained as an economist, she doesn't have central bank experience. She hates Matt, so this is going to be a different European Central Bank. Bloomberg will host the

New Economy Form in a few weeks in Beijing. To coincide with that, our Bloomberg Economics team came up with the New Economy Drivers and Disruptors report Jason. It takes a look at all the new forces that are narrowing the path to development, and it's really going to determine the winners and losers going forward. I love digging into this because there are some nice graphics really help you understand the size and scopes, some nice narrative as well.

Tom Orlick is the chief economist for Bloomberg Economics. He joins us from Washington. He helped put all of this together. Tom help us understand the framework because that sort of sets the stage for all of the conversations going forward. The way we think about this is is something like this. UM Imagine an economy which is doing everything right. They're innovative,

they've got a skilled workforce, they have an efficient government. UM. Now, imagine there's a huge meteor hurkling towards that country at a thousand miles an hour, and when it hits, it's going to wipe the country off the map. UM. Well, a traditional economic index, a traditional competitiveness index would tell you that country is doing just great. They're going to be great now. They're great in ten years time, they're

great in twenty years time. What our Drivers and Disruptors report tries to do is to tell you about the meteor tell you about the big risks out there in the global economy, and which countries are well positioned in relation to those risks, and which countries which economies face some challenges and the big meteors. We're looking at our protectionism, populism, automation, the rise of the robots, digitization, and of course the big challenge climate change. What I love time too is

how comprehensive it is. Do you just mentioned some of the big disruptors that you're looking at, but you also looked at a hundred fourteen economies essentially excuse me, so almost all of the global GDP, So you really looked at the world developed and developing. Yeah, that's right. One of the striking takeaways is the difference between how well positioned advanced economies are and some of the challenges which

lower and middle income countries lower middle income economy face. Um. The big narrative on the global economy in the last fifty years has been a story of catching up, first Japan, then Korea, then China, catching up to income levels which we see in Europe and the US mainly by exporting UM.

And what our analysis tells us is that with some of the disruptive forces sweeping the global economy, things like protectionism, things like automation, with robots able to do more and more of the low skill, low cost jobs which have been an advantage for lower, low cost economies in the past, that path to development which low income countries have followed is not broken, but it's just going to be much harder to follow well. And this is what I love.

This whole idea of catching up is harder to do in this environment today. Yeah. So, I mean, let's think about the big forces that have propelled cat up in the past. UM. So there's low incomes or low cost wages UM. And there's the big open global economy UM. And there's policymakers who are willing to make the difficult, sometimes painful reforms to align economies for growth UM. And across each of those, the disruptive forces that we're tracking

are going to make life more difficult. You've got robots which can do more and more of the tasks which people currently do in factories and do them at lower and lower cost, so that erodes the low cost advantage which was so powerful for for China and Korea and Japan. UM. Then we've got protection is M Japan, Korea, China, they grew in part because they could tap those free, open global markets. UM. But now we've got this decisive swing towards protection is UM and so tapping globe markets is

harder to do. Alright, So Tom, you're gonna be there in Beijing. Let's talk about China because it's very prominent in your reporting. Clearly one of the world's most important economies. This idea of the meteor headed toward Earth, clearly China figures very, very importantly in this narrative. How does China fit into this? So China is a really interesting story. Jason on the traditional drivers of development, China really outperforms. Uh.

They're the fourth ranked economy in our index. They're investing in research and development, they've got some world class infrastructure, UM. They've got an increasingly highly skilled workforce, they've got an efficient government. So if you look at the traditional drivers of development, China has really got a lot of those firmly in place. UM. But when we think about the disruptive forces which are going to be hitting the global econom me in the next ten twenty years, China faces

some significant challenges. The most obvious one striking right now is protectionism. Bad for China's exports, bad for China's capacity to learn from foreign technology UM. Looking further forward, China's one of the most exposed countries in the world to climate change UM. A big population, many of them on

the coastline, many of them involved in agriculture. There are some real risks from climate change to China going forwards, and if we dig into the details of what's going on in China's society, we also see challenges with relatively high levels of inequality, relatively low levels of social mobility UM. And if we look around the world UM in other countries which have had those problems, that's been a medium

term challenge for policymakers to address as well. Tom, Let's talk about some of the other rankings, because that Jason, I'd loved going through the list. I mean, talk about the countries that are up at the top. You mentioned China's number four, but talked us just quickly about one, two, and three. One of the big takeaways from this report is that catching up is getting harder to do, and

we see that reflected in the rankings. Um So, we've got advanced economies like some of the some of the Northern European economies Sweden, Norway, Denmark, Germany, um some of the high performing Asian economies like Singapore, and they do really well on the traditional drivers of growth. They also score very well on those disruptive forces. They are well positioned to deal with the rise of the robots. They've got policies in place to help retrain workers. Um as

automation takes over a larger share of traditional jobs. They're well positioned on the digital economy. Their consumers, their businesses, their government are all engaged in those digital opportunities. They're exposed to protection is M, but they don't have that really high exposure to protection is M that we see in some of the Asian exporters and some of the advanced economies which are breaking their trade ties with the rest of the world. Well. And it is so interesting

to look at the top five just running through them. Sweden, Switzerland, Denmark, China, Australia, those are the top five when it comes to the drivers, and they do have this really interesting balance, as you say, and when you think about the five most important economies in some ways. Some are there, some aren't. These aren't obvious choices, and that's one of the really provocative things

I think about this list. Ultimately. Yeah, So I think if you look at the if you look at our drivers of if you look at our rankings on the drivers of growth, I think it looks fairly. I think it's going to be in line with people's intuitions about which countries are poised for success and which countries face

some challenges. I think where a lot of the controversy, where a lot of the interest, where some of the provocation comes from, is in how we're looking at those disruptive forces and how those disruptive forces are going to be upsetting the pattern of winners and losers. Well, and I just would say, so, China's in fourth place, the UK is in this in sixth place, Germany is in

twelveth place. United States is in seventeenth place. Just to sum up, where's the U s and all of this in terms of drivers versus disruptors, I mean, the US is engaged in a trade war against China, a trade war with China UM, and the motivation for that trade war UM is partly to determine who's going to be holding the keys to the global economy in the twenty one century, who's going to be the most competitive, who's

going to have the most advanced technologies? Um. And part of the motivation on the U S side is the concern that China is not playing by the global rules. Um, they're not protecting intellectual property. UM, they're forcing Western firms to hand over technology. And if we have a trade war and we win that trade war, um, then those

problems will be solved and America will be number one. Well, what our report is telling us is well, that's all well and good, um, but there's also a bunch of things you need to do at home to make sure you're competitive for the future, things like really making sure you've got world class infrastructure, really making sure you're making significant investments in research and development to retain that competitive technology edge. That's Tom or Like, he's our chief economist

Bloomberg Economics. This was a really fun conversation because they looked at the entire global economy very specific factors and tried to figure out where every nation developed or developing stand when it comes to drivers helping them out or disruptors that might hold them back. Well, and it's a different lens in many ways, and not surprisingly, it gives you a different result. And I really liked what he

said about China gets role in the global economy. It's obviously important, but when you think about it in this context, I feel like you look at China a little bit differently. So it's clear that global economies, they're watching the political scene around the world. We've got something that will help them. It's this week's New Economy issue. Let's get into it with editor Joe Weber here to tell us all about it. It is a great issue and it's another must read

I feel like for the world at large. Yeah, a lot of this. You know, it's really easy to talk about the news and the short term stuff, but there are bigger, bigger issues that are really going to define what the future looks like. And that's sort of what the New Economy Issue is really about. The world's growth is really going to come from the emerging economies rather

than developed ones. That's something that Hank Paulson in and Row really hits on, like the problems that that this issue is really devoted to and the solutions that we hope to really identify at the Forum in November are really geared towards solving problems in the emerging markets, and so how do you break that down in some ways into something that is candidly sort of digestible. Had a

lot of help on this one, including from Bloomberg Economics. Yeah, so we actually divide the book up into chapters, and it actually feels more like a book almost than any other issue that we do. And those chapters aligned with the pillars of the forum, so things like trade and that.

That allows us to talk to Tom Orlick of Bloomberg Economics who came up with this Drivers and Disrupters idea to really like rank countries based on their ability to either disrupt or drive engine the engine the global engine of growth, right, And it's interesting. There's some interesting takeaways there, like the US isn't one that really rises to the

cream like some other places, So that's interesting. We have talking about that that the kind of the top two, top one, two, three or four names you might find a little bit surprising on that. I'm gonna save it for the issue. Yeah, do that. Another one is inclusion, right, and so there's different ways that we can talk about that, but one that we chose to look at what women in the workforce via fertility around the world. We're actually

watching fertility rate, the global fertility rate. Calm down, we're not making enough babies actually, so we actually pulled out some case studies via data and also women in various countries to talk about why don't you have more babies? And that impacts their ability to to work with their family life's like, and then that translates into economic growth because if you're not having future generations behind you, we

just simply don't have enough people. Some really big issues, long term issues, tackled in this very special issue of Bloomberg Business Week Will Webb, thank you so much. Disruption and transportation as another factor to consider, a backlash against cars and a technology whose time may have come and gone. Very provocative, fun it is, and you know, we love talking about transportation and cities, all the implications very close to home here at Bloomberg. Max Chafkin, features editor for

the magazine, is here with us. Super Blocks. Didn't know that was the thing, but it makes sense when you start to explain it. So explain it's so Superblocks. Actually, it's a it's a very old thing. Um, if you look at kind of fifties style public housing, uh, you know, basically a lot of the sort of urban thought that was going on, you know, in the forties and fifties. This idea of building these giant towers with like big roads around them, and the idea would be that people

could sort of walk within these blocks. Super blocks considered a good thing. Uh. Yeah, And and and people have kind of moved away from that. We've we've much we've moved to these cities with little grids and and all sorts of stuff. Um. The story that we have in this week's issue is about a town in northern Spain called Victoria. Guest guess days, I hope I'm saying that right, Um. And it's um. It's basically a town where they just started radically getting rid of streets with cars. The town

has created sixty three of these super blocks, Um. And these are streets where basically cars are not allowed. The only way to have a car is if you live on the street, or if you're a business and you're getting delivery and the cars can only go ten kilometers an hour, which is yeah, six miles an hour. It's

a jog. I mean, it's or not a jog. It's you know, it's it's it's a it's it's a sort of pedestrian scale pace and everything else, you know, as the writer West and Zena describes, you know, very poetically in the story, is basically cyclists, pedestrians, children, you have, you know, Toddler's running about. It's it's it's really a kind of like car free paradise, at least if that's your kind of paradise. Yeah, it's pretty amazing. Tell us about the guy who's behind it, right, because he's really

led the charge here. Yeah, Salvador Rueda, who's a Spanish urban planner, and he has done these kind of superblock conversions in a bunch of cities in Spain, including Barcelona. Uh. And also he's he's a little bit of work in South America in Quito, Ecuador, as well as Buenos Areas. There's even a plan uh in in Washington to Seattle, sorry, to bring uh super blocks there, although that's still kind of in discussions. The interesting thing is is Washington, Washington,

in Seattle, It's okay. The interesting thing about this is he's had a lot more success in Spain, I mean especially in this town Victoria Guestez, which he calls his laboratory. This is like proof that this concept can work. But is it just prime in terms of the way that that kind of that locale is set up. I think it has to do. It's it's partly cultural. And you know, these cities in Spain are very small. They they are very much pedestrian oriented. You know, Europe, most of these

cities were laid out pre automobile. You go to place like Buenos Areas, which you know, obviously the city was laid out before the car, but that's a city that is way more dependent on cars, you know, much like an American city. And and there it's been a lot more controversial. You've had sort of complaints that they've they've managed to pull it off in a few neighborhoods, but not in the kind of scale that they've been able

to do in Spain. Um. What's what's really provocative here to me anyway, is just that this does not cost a lot of money. As as Rueta points out in the story, I mean, you don't really have to. Um, you know, you're not demolishing anything, You're you're basically just telling people they can't drive their cars on the street. So it's it's more it's almost like a cultural solution to the problem of climate change and also traffic deaths. And so what's the downside? You know it obviously folks

are relying on cars. You think about a lot of American cities where the commutes have just gotten bigger and bigger and bigger. People are trying to move into cities, and yet cities in many cases aren't affordable. So how do all those things balance out? Yeah, I mean there there are a couple of key downsides. One downside is maybe you just don't want to live like this. I mean,

you know, having a car is really convenient. It's a big part of how Uh in a lot of parts of the world, you know, sort of people relate to their surroundings um, and then there's this sort of gent racation issue. You start kind of creating these like beautiful urban islands, and we've seen this in lots of places including the US, and and real estate prices go up and then the people who live there are you know, forced to leave. Uh. The sort of Spanish solution to

that is just to put lots of superblocks everywhere. So it won't you know, affect the real estate prices too much. Everybody's going to have these things, at least in this in this one city in Spain. What does it do though on society and what does it do in terms of the environment. Yeah, so, uh, the the the Spanish cities that have done this have reported you know, amazing impacts. We're talking, you know, I think we have the number in the story. I believe it's of the cars on

the road in Vittrria. Guests are are gone now, the carbon emissions of the city something like down about and you have a huge percentage of population walking as their main uh, you know form of transportation, another fifteen percent biking. So that's like sixty of people are using a non car you know, method of transport, which is you know,

it's pretty amazing. And when you consider both the sort of carbon emissions of you know, caused you know, automobiles, but also yeah, the traffic deaths, it's it's it's potentially as a huge impact well and presumably the knock on effect of if people are walking, that's good for their health, and you know, they're all these sort of benefits that come on that may be harder to measure, at least in the near term, but eventually will be much clearer

as time goes on. Yeah. I have to say, what's interesting though, you see a little bit of that New York, right. I have a town in a street in our town that's been shut down, and you know, so you're slowly seeing it kind of creep around the world. Yeah. I mean, it's definitely a cultural thing, and you alluded to it. I mean, we've over the last twenty years there's been this kind of renewed interest in downtowns, which comes with

an interest in walking. Um. One other thing about this Spanish town that's pretty interesting is it's a huge car town. It's it's the second of it. I believe it's the second biggest car manufacturing city in Spain. There's a Mercedes factory in town, there's a Michelin plant in town. So this is a city where uh, cars are really part of the at least the business culture and and the and their sense of identity. And even so it's embraced this kind of solution m as West rights in the story.

You know, even the taxi drivers union is in favor of this, and you sort of imagine, you know, if you're if you're driving a car for a living, this is not going to be something you're into. But but they managed to really get you know, bipartisans support both from the unions and kind of the center right party, and he's building more right around the world. He's trying and I will see if the you know, if people

are willing to go for it. That's Max chaff and he's our features editor and he took us through the world super blocks. You know, we see a little bit of this, I feel like in New York City where streets are being closed down and they're basically for pedestrian traffic. But if you look at some cities around the world, it's not just a few blocks, it's a much larger footprint. Well, and you do wonder, having read this and talked to Max about it, whether this is something that's going to

catch on as we go forward. Some of these experiments have delivered some surprising results, so interesting to see where it goes from here. Check out this week's issue of the magazine. You'll find an interview with the co founder of Emphasis, who returned to his company two years ago

following a scandal and firing of Evan CEO. Right, this is a guy very much at the center, as you say, of arguably one of the most important companies, certainly in India, and part of the conversation is about expanding that reach, both for his company and beyond. We're talking about Nandan Nila Khannie. Jeff Muscus is here, the technology editor for Bloomberg business Week. This guy's pretty provocative when it comes

to his vision for the world. Tell us about him. Yeah, he's He co founded Infocist in the early eighties and has been with the company in a number of top roles for much of that time, including as CEO for much of the early Oh it's before a two thousand nine when he left to join the Indian government in a newly created position to help develop at her this sort of national biometric I D program that's proven highly controversial for reasons you might imagine, Well, you kind of

like skimmed over that. That's a big deal, right, I mean that he created that was big in terms of its impact on India. But you're right, it's very controversial. Yeah, the the this kind of biometric data slash national I D card program is now used as no kind of points out in the interview with our reporters or the rye by you know some one point to billion Indians for things including social security payments and uh and baseline I d in all kinds of ways that UM didn't

really exist in a stratified way in India a decade ago. Um. You know, but that's that's proven uh, you know, controversial among privacy advocates because the system has proven relatively right for abuse. It's easier to fool than you might think. Uh and uh and yeah, there's their ongoing concerns about UM the degree to which people's data, including their biometric data, might be used for various purposes. Well, and between that job and working on that and you know, now his

day job and the company he founded. Emphasis really takes us into the heart of arguably some of the biggest issues of our time as it relates to as you say, privacy, as it relates to technology and its role in our lives. What did he have to say about things like, for instance, artificial intelligence because that plays into this as well. Sure, UM, yeah, AI, along with big data in general, which sort of the our our buzzword for AI before we start using AI.

UM was the you know, the big differentiator in his mind between various companies in the I T outsourcing space like Infosis, as they've tried to approach the big cloud companies and the other big industry leaders around the world who tried to sort of differentiate themselves by figuring out as much about their customers as possible. So that also raises privacy issues on the other end, as you might

imagine that. Uh, you know, the differentiator here in the industry's mind is how much more they can figure out about a given companies customer base, for example, then they might have been able to a decade ago, um, but without particularly going into a ton of detail about how they get that information. Why did you want to talk to him? No? I mean it's like I think about you go back to when this company was first great. I mean, we used to talk about emphasis a lot.

I feel like you don't talk about it as much anymore. And I do understand there was a scandal couple of years ago. I mean, but why, I mean he's got

a back page to the magazine. Why him? And why him? Now? Well, he's been a pretty central figure in India's text base for you know, much of the past half century and all the more so now that he's you know, played a leading role in the development of this program and then sort of gone back into the corporate world to try and and and write the shift of varying degrees at the company he helped start. But you're right that inmphasis like the other leading I t outsourcers in India.

I think it was a much bigger part of the conversation even just a few years ago when the question, a lot of the question is about America's text seeing revolved around H one bs and the degree to which perhaps UH immigrant labor was being used to buy big tech companies in America to keep prices or wages artificially

lower than they might otherwise be. Um. You know, in the Trump era, the conversation is shifted as uh you know, the reministration has made good on on some of its it starts to crack down in H one b use in general, but you know, it's also shifting the conversation around UH immigration and wages and of course big tech as well. As you know, the fallout from the election has put the industry on much different focus. And that's Jeff Muscus. He had some important context about that conversation

with EMPHASIS co founder non Done Nila Khani. And one of the things I really appreciated about that was the importance of that business, that industry in India, but also India's coming influence in a lot of ways. Where that country he goes next is going to have a profound impact on the global economy. Right. We talked about the startup scene and where it's going. So really good to get his insight. Susan Lyne's career has spanned publishing, multimedia,

and venture capitalism. She's the former president of ABC Entertainment. She oversaw a O L dot com Jason. She has done so much now she is in the world a VC all in on that. She's president and founder at BBG Venture. So we had a lot to talk about. It's a great conversation. I really enjoyed it. Let's listen. In your career has spanned so many different industries and multimedia, I think about publishing, venture capitalism. I want to ask you,

there's so much going on in these worlds. What is it that you find kind of interesting in terms of disruptive trends right now? Oh? Wow? Um, I know it's broad, but I just curious there are so many things, and they they fall into a couple of categories. So I still think that there are a lot of industries that are that have not been disrupted. Actually, healthcare is probably

the biggest opportunity that exists right now. Uh, there are still so many consumer unfriendly parts of of the health care journey UM, and everybody, every single group at the table believes that we need to have new solutions, whether it's insurers or it's it's health care providers or its consumers UM. So that's always a good moment to be

be investing. And we're actually seeing a lot of I think more interesting models for delivery of either mental health care or or physical health care UM that will need to scale to prove themselves out, but could be very viable over time. Well, and I looked at your investment more friendly. I mean, since then, you guys are in a lot of different areas. Are in retail, UM, you're in you know, property, You're in some any different areas in terms of healthcare. What are some of the new

models that you're seeing. What are some of the interesting opportunities that you find that you want to commit money. Well, we've made a couple of investments. We're in a company called spring Health that takes over healthcare coverage for employees. So they sell to companies. They say, let us do this for you. We will be able to get your employees to the right kind of care faster than you could possibly do it. And they do that using algorithms.

They have a great database UM and they can both save companies money and at the same time they can get employees the care they need so much faster that uh, it's a real bonus for the company culture. How difficult do you think that it is to kind of untangle the existing healthcare infrastructure. I think this is such a tough one, and I think it's why you're not seeing it.

One of the earlier cases of just eruption. So how how much you know the traditional healthcare companies that we have today will be ultimately five years, ten years, they're not going to be the major players because there's companies like the ones that you're investing in UM under the I think it completely depends on which part of this ye're talking about. So I think the insurers are probably not going to change in the short term, but I think they are looking for more cost effective and more

successful solutions to a lot of different issues for consumers. UM. So they're actually aligned with with all of us, right, if you can find the right product for them, if you can find something that you can show them you're spending X, now we can do this for why and you're going to save money. So I think there are

there are definitely alliances to be made. UM. Yeah, of the biggest issues has been how slow it is to get change at UM at large health care institutions, whether their hospitals or their UM but there are far fewer providers and so and by that I mean insurance providers. UH that it's probably easier if you can find an alliance with them. Now, there are also a lot of companies that are starting clinics and new models for delivery of either women's health care or um or prenatal and

postpartum care. They're taking some piece of this and they're saying we can do this better UM and so I think it will take time for those to scale up. But as startups, a lot of them are doing very well right and when it starts to show U impact on bottom lines or something, it's very easy for them to ramp up. I have to ask you about the media world. I feel like there's so much going on. You're the former president of ABC Entertainment, streaming Wars already

laying it out in Business Week magazine. This is going to be one of the big themes to watch. Um, who who will you be watching? There's Disney plus, there's Apple plus, Comcasts got Peacock, HBO has got a new entry. Yeah, what do you think it's interesting? Well, I think Disney is really interesting. Now I'm I'm probably biased because I was a little bit company for a decade, but I do think they have unique assets and that's one of the things either has done that I think it's been

incredibly smart. Um. If you look at the movie business that Disney has because of the companies that have acquired, because of Pixar, because of Marvel, m, because of the Star Wars franchise. Uh, they have you know, I'm gonna say more than half of the billion dollar phil homes that have come out in the last five years. Um, you want to see it exactly and again exactly? Um?

And who who know the franchise right? So so they don't have to hear a long description of it before they know, Hey, I want to I want to watch this um and now with Fox they have an even bigger library, so I think they're going to be hard to beat among the new entrants, and they're coming out pretty inexpectively. I think it's six so it's easy to kind of tack that on absolutely. Um, it's cable dead or getting slowly towards that. I mean, there's still like

eighty million US cable subscribers. But what what happens? You know? I think it's going to take time. But I look at my children and they are not cable customers. So this is largely a generational shift. I think that, uh, that people who have grown up with digital assets and to understand how to use Apple TV and how to use Roku and can put together their own you know what would have been a cable assortment, right, they can

do that themselves for a lot less money. Do their own bundling exactly, although some say that you could ultimately see a bundling of streaming services down the road. Do you think that. I think that's very possible. Yeah, why not? Right? So what about building a brand in this environment? You did it with Lifetime, You did so well. It was a very clear message ramped up so successful. Can we do that again today on television in the in the broadcast or or or cable world, I think you can.

I think that tougher the Yes, it's definitely tougher. But it all comes down to programming. To be honest, if you look at how every single one of the cable networks became six sessible, it's because they had a single show that defined what they were about, right um. For for HBO, it was the Sopranos, for um uh, for FX, it was Madmen, um for uh, for show Time. You go through all of them, you knew what you were getting,

you did. And then once they realized they had an audience for that, right, they could begin to develop shows that had a similar feel or were for similar group of people. And the great thing about cable always was that it was not about the number of people watching. It was about the passion of the people who were watching. So if they really, really really loved to show, that meant more than having an extra million people viewing it.

As it made it that much harder for a cable carrier to kick them off, right, because they have a revolution right right. And I also do think like in today's social media world, where there's so much data collection, you had a very clear identity. If you're trying to market it two advertisers, right, you knew exactly what you're getting.

So I think you're going to see that the new streaming services to where initially a single show or a single series is going to define what this one is all about, and that's going to be what people kind of choose their sides with. I'm not sure if you got to watch any of Mark Zuckerberg today upon Capital Hill, if you talked a lot about Libra. It was the House Financial Services Committee. What do you think will happen to social media going forward? And these big players or

you see it? Should they be broken up? In your view? I I feel like I am not really the person to answer that question, but I do believe that there is too much power in too few platforms at this moment, and uh that's always dangerous. So whether they get regulated, whether they get broken up, that's for other people to decide. But I don't think you can leave things the way they are where where a single platform like Facebook has

the power that it does. That was Susan Line, President, founder of BBG Ventures for the full interview with Susan Line. Check out our Bloomberg Extra podcast wherever you get your podcast. And that wraps up Bloomberg Business Week's weekend podcast. Thank you so much for joining us. I'm Jason Kelly and I'm Carol Masster. Be sure to tune into Bloomberg Business Week Radio Live Monday through Friday, starting at two pm Wall Street Time. And if you can't catch us live,

get our daily podcast for the ride home. Get that iTunes, SoundCloud, Bloomberg dot com, or wherever you get your podcasts. And of course you can get this week's edition of the magazine. It is on newstands now and we'll be back right here next week at the same time. This is Bloomberg