The German Marshall Fund and EGMONT present Managing Challenges of Globalization for Industry and Society with discussants Dr. Manfred Bischoff, John Evans and the Hon. Robert Kimmitt. Margaret Warner moderates.
Dr. Manfred Bischoff
Dr. Manfred Bischoff is chairman of the supervisory board for DiamlerChrsyler. He began his career with DiamlerChrysler in 1976 as a project coordinator for the collaboration with Steyr-Daimler-Puch. In 1981, he took over the responsibility for Participations, Mergers and Acquisitions within the Finance Division, where he became an area director in 1986.
In 1988, he became chief financial officer and board member of Mercedes-Benz do Brasil. In 1989, he became chief financial officer of the board of Deutsche Aerospace (the later DaimlerChrysler Aerospace AG), and in 1995, he was nominated board chairman of Daimler-Benz Aerospace (the later DaimlerChrysler Aerospace AG) and member of management board of Daimler-Benz AG.
With the formation of the European Aeronautic Defence and Space Company (EADS), formed by the merger on July 10, 2000 of Aerospatiale-Matra of France, Construcciones Aeronauticas SA (CASA) of Spain, and DaimlerChrysler Aerospace AG (DASA) of Germany, Dr. Bischoff assumed the position of EADS chairman. In 2003, he retired from the management board of DaimlerChrysler AG and in 2007 he was elected chairman of the supervisory board of DaimlerChrysler AG and resigned from the board of EADS on the same day.
John Evans is general secretary of the Paris-based Trade Union Advisory Committee (TUAC) to the Organization for Economic Co-operation and Development (OECD).
Mr. Evans is a British national. Prior to joining TUAC, his previous appointments have included research officer at the European Trade Union Institute (ETUI) in Brussels, industry secretary at the International Federation of Commercial, Clerical and Technical Employees (FIET) in Geneva, and economist at the Trades Union Congress (TUC) in London. He is currently a member of the board of the Global Reporting Initiative, and member of the Helsinki Group. He received a degree in politics, philosophy and economics from Oxford University in 1973.
Ambassador Robert M. Kimmitt is a senior international counsel in the Regulatory and Government Affairs Department, and a member of the Defense, National Security and Government Contracts Practice Group. He originally joined the firm in 1997 and rejoined the firm in 2009 after serving as Deputy Secretary of the US Department of the Treasury.
Margaret Warner is one of five senior correspondents who join Jim Lehrer on PBS's nightly news program, The NewsHour with Jim Lehrer, reporting on the serious news of the day, and interviewing the people at the center of it. She is also the lead correspondent for The NewsHour's new overseas reporting project, which has taken her in the past year to Israel and the West Bank, Sudan, Iran, Turkey, and Venezuela.
Additionally, Ms. Warner is one of four co-anchors of America Abroad, an hour-long radio program devoted to foreign affairs on Public Radio international. She joined The NewsHour in 1993 after an award-winning career in print journalism covering foreign and domestic affairs. She spent 10 years at Newsweek magazine - as political correspondent, White House correspondent and finally as chief diplomatic correspondent during the end of the Cold War, the collapse of the Soviet Union and the first Gulf War.
Previously Ms. Warner was a reporter for The Wall Street Journal, The San Diego Union and The Concord (N.H.) Monitor. She is a member of the Council on Foreign Relations, and a trustee of Yale University.
John Evans who is the General Secretary of the Trade Union Advisory Counsel tothe OECD. And we're just going to start out with a quick question to the three panelists andI'm going to start with Dr. Bischoff, which is before we talk about the solving the challenges of globalization.Let's see if we agree on what they are. What do you think is the greatest challenge toglobalization? If we're talking about the integration of economies, the free flow of goodsand services and people and capital today.Actually I see two main challenges for globalization and I hope we allunderstand under globalization the same things, free exchanges goods, services, andinformation based on the stage of modern technology.I see the first challenge is what I call the acceptance of a free market economy including thefree exchange, especially in the more advanced countries. The second challenge I see is thatfree exchange, by far, is not complete. Look at how limited we are in the agricultural sectoror look at some countries (INAUDIBLE) free exchange partially yes, partially no.There are countries which limit the free flow of information. At least they try to. There arelimitations through that free flow. So I think we have that big challenge to show our ownpopulations that globalization is good for everybody. And I think that is a very big issue andthe other one is our limitations to that basic idea.Secretary Kimmitt, is it both acceptance by the public and at the same time lackof completion by those who are engaged in trying to keep the momentum up?Certainly I think those would be two of the challenges, Margaret. It's always interesting tome, anytime we talk globalization we go immediately to the challenges. There aretremendous benefits from globalization and there are tremendous opportunities from globalization.We went from 20 percent of the world population living in poverty in 1970 to just sevenpercent in 2000. That's still too many people, but there have been benefits fromglobalization. I agree with Manfred on the challenges he mentioned.I think, fundamentally globalization has produced a period of accelerating dynamic changethat has led to uncertainty, concern, and even anxiety among populations. I think it's a timefor real leadership to let people know that the answer to that dynamic change is more open.It's not more protectionism and barriers.John Evans did you agree with the diagnosis and let's move onto answers. Is the answer more openness?No, I don't think it is. I think it's a question of insuring that global trade andinvestment actually does transmit into higher liver standards and that those living standardsare more shared internationally and in within our economies. And at the same time, that thatwhole process is sustainable from an environmental point of view.And I think that the major challenge at the moment is that too few people are actually gainingfrom globalization and the potential fruits are actually being distributed very unfairly. Andwe've seen writing in equality, both within our (INAUDIBLE) and also gaps appearing between countries.So it's a question and I'd perhaps challenge the Deputy Secretary on some of those figures onpolity. It depends what you're actually looking at, but I think the major challenge unlesssome of the fruits of globalization are shared more evenly, distributed better, then the publicconcern as you've mentioned, they are not just perceptions. They are reality of insecurityand unfairness of what's happening on the ground.Do you think it is perception, Dr. Bischoff or reality, what the public is sensing?That it's leading to a growing gap actually.But it's interesting to note that's a difference in perception.It's obviously different if you look, for example, in emerging markets in Asia. So it's awidespread feeling that globalization was a real success for such countries.In some of the more developed countries, you know, it's not so obviously seen; becauseclearly we have profited quite a lot and I totally agree with Bob if you see, for example,increase in world trade. And I always take my special example, how trade, even betweendeveloped countries can be very successful.You only have to look at what has happened inside the EU for example for the trade betweenFrance and Germany. It's the same you have seen the world over so it's the more advancedcountries were very successful, for example, in exports. We have an internal problem in eachof our countries in that the fruits of those are not, you could say, equally distributed. So youhave more people who profit. I think there are more people who profit clearly. But for surethere's some who are left behind, and we have to give an answer to decide internally.But are they less equally distributed now in this area of globalization than they were?I don't think the root cause for that, basically, isglobalization, because part of it is technology. And I think we would have to face thatproblem how we distribute the national income and how it's created into individual countriesanyhow. So I think it is somewhat misleading to say the root cause for that is globalization.Actually although John disagreed with me on the point of openness being the process that weshould follow, I actually agree with the points that he made, both as to perception and as tofacts. Those are part of the challenges of globalization.But I don't think that we meet those challenges by being closed to trade or closed to creatingnew opportunity. And I think it's important to recognize that a lot of the disparity is a thatis, a wage disparity in some of the other disparities that John mentioned really go back to thefundamental point that if you look at who is educated, who is trained, those are the peoplewho tend to do well, whether they're in a developed country or a developing country.And therefore I think we need to look at what is causing this disparity, and recognize, in myview, that a continued investment on education, on training through a lifetime of learning, alifetime of employment at a time again of accelerating dynamic change is going to be an important step to take.So that sounds as if you're talking about that the remedies are domestic in nature.Well, no. I think, of course, each country will have a palate of domesticremedies. We have in the United States, for example, trade adjustment assistance, theWorkforce Investment Act.We also have the lifetime learning credits, the Hope credits, subsidized student lending.Those types of things are domestic responses. But I don't disagree, I think, with the pointthat John was making, that as we look at trade agreements, as we look at bilateral relations,that we do have to look at some of the issues that have been mentioned, including workforce,environmental and other issues on a global basis.Now John Evans, you're, and then we're going to go to the audience, so get yourquestions ready. Your organization is also concerned still about capital flows. Explain that.Yes. Well I think it would be wrong to look at the problems just as a trade issue.And I don't disagree with many of the things which have been said. But I think what haschanged about globalization is that now work is a part of global supply chains, and this hasincreased the exit option for companies in those sectors.Well, you can say if you don't like it here, we just source from China; we'll sourcefrom somewhere else. And that pressure has, I think, started now to show up in the figures.If you look at the share of national income, which has been going to wages and workcompensation throughout the OECD, that has actually fallen over the last 15 years quitesubstantially, and has actually now reached record lows, the actual, the share of wages.And even within that wage share, if you look at some of the key countries, and particularlythe United States and I'd agree many of the solutions may be domestic, you see very rapid growing inequality.I think in 2005 the top ten percent in the wage share. Their income rose by 14 percent. Thebottom 90 percent, sorry, bottom 80 percent, their incomes actually fell by 0.6 percent. Soyou need the domestic policies. The Nordic countries haven't had that problem. They'vebeen able to distribute it better.As a result, our affiliates are actually more confident about what you can do about trade. Butyou also have to tackle the issue of what are the rules in the global economy. What are therules on core labor rights in different parts of the world? What are the rules on how multinationals can operate? What are the rules of financial markets, and look at both directions.What hands domestic and also what you can put into trade investment agreements and other forms of governments.All right, well let's bring all of you all in now and yes right here. Even thoughwe know one another, please announce your name, and if you are in the back rows youactually already have microphones. All you have to do is press the button. You don't need to lean in.