Transcription
Our distinguished guest speaker, Professor Jeffrey Sachs, and Mrs. Sachs, your excellencies, distinguished guests and colleagues, ladies and gentlemen.
Very good evening and warm welcome to the Sixth Economic Society of Singapore Distinguished Public Lecture titled "ASEAN and the World Economy to 2050."
The first Distinguished Public Lecture was given by Professor K.S. Jao, Assistant Secretary-General for Economic Development of the United Nations. Other distinguished lectures that followed were given by Professor Andrew Oswald from the University of Warwick, a well-known behavioral economist; Dr. D. Subbarao, former Governor of the Reserve Bank of India; Professor Brian Arthur, who was Dean at Stanford and a founding member of the Santa Fe Complexity Institute; and Mr. Michael Noonan, former Minister for Finance for Ireland in 2017.
So, the Economic Society of Singapore is honored to host Professor Jeffrey Sachs, who is no stranger to all of us, and is a world-renowned economist, a global leader in sustainable development, and an advocate for economic cooperation, as the sixth distinguished speaker. The lecture explores how ASEAN stands at a pivotal moment in defining its role in global growth, innovation, and sustainability, as the world economy undergoes rapid transformation.
You will know that, of course, Professor Sachs has a very, very long CV. So, here it suffices for me to mention a few things about Professor Sachs. Professor Sachs is widely recognized for bold and effective strategies to address complex challenges, including the escape from extreme poverty, the global battle against human-induced climate change, international debt and financial crises, national economic reforms, and the control of pandemics. He serves as the Director of the Earth Institute at Columbia University, where he holds the rank of University Professor. He is also the President of the United Nations Sustainable Development Solutions Network. He is co-chair of the Council of Engineers for the Energy Transition, is a commissioner of the United Nations Broadband Commission for Development, and closer to home in Malaysia, the Tan Sri Jeffrey Honorary Distinguished Professor at Sunway University. He has also been an advocate and advisor to Secretaries-General of the United Nations, including Kofi Annan, Ban Ki-moon, and now António Guterres.
Professor Sachs has authored and edited numerous books, including three New York Times bestsellers: "The End of Poverty," "Common Wealth: Economics for a Crowded Planet," and "The Price of Civilization." He is also the 2022 recipient of the Tang Prize in Sustainable Development and a co-recipient of the 2015 Blue Planet Prize, which is the leading global prize for environmental leadership. He was twice named among the Time magazine's 100 most influential world leaders and has achieved 42 honorary doctorates. His recent awards include the Legion of Honor from the President of the Republic of France and the Order of the Cross from the President of Estonia. Prior to joining Columbia University, Professor Sachs spent over 20 years as a professor at Harvard and, more recently, as the Galiano L. Stone Professor of International Trade.
As you are all aware, Professor Sachs is well known as a leader in driving the agenda for sustainable goals, generating motivations for others to follow. In this regard, I would also like to quote Professor Sachs: "There is an urgent need to communicate with the public and help to explain where there is consensus and where there are doubts about the issues of sustainable development."
With global uncertainty, I look forward to the fruitful discussion we're going to have with Professor Sachs on ASEAN's long-term economic prospects and the pathways to the year 2050. Let us now put our hands together to welcome Professor Sachs on stage.
[Music]
So, thank you very much. Next one.
Thank you. Thank you so much for that wonderful introduction and especially for this wonderful occasion to be together with you and ambassadors, excellencies, distinguished ladies and gentlemen. It's a, it's a great honor to meet with the Economic Society of Singapore and to have a, a chance in what is a very important week of diplomacy, uh, to take stock of where we are and where this world is heading. And of course, in particular, this is true for ASEAN.
The summit that just took place in Kuala Lumpur was enormously successful, and, uh, all kudos to the government of Malaysia and to Prime Minister Anwar Ibrahim for his wonderful success in negotiating. When you have a successful summit, welcome Timor-Leste into the family as the 11th member of ASEAN, uh, and have smiling faces of the President of the United States, the Prime Minister of China, the Premier of China, and the Prime Minister of Japan, you're doing very well. Uh, and it was even beyond that because there were many, many international leaders, President Ramaphosa of South Africa and President Lula of Brazil and others who came as well, all indicating the great significance of ASEAN for the world. ASEAN has everybody's attention, uh, as a very dynamic region, uh, and a region of extraordinary promise for future development. Everybody wants to be here, including this axis. So, we're very happy, uh, to, uh, be here on, on this occasion.
And I want to talk about the, the medium term, meaning to mid-century. And I like that time horizon. And to explain why, let me share, uh, an event from 28 years ago, nearly 30 years ago. In 1997, I published a quite good book that you never heard of. Uh, and, uh, it was taken off the shelves immediately. Uh, it was a book called "Emerging Asia" for the Asian Development Bank, and it was a, a project, uh, of several years to look at Asia's future with the idea of looking from a 1995 base to the year 2025. And it gave quite a rosy scenario that, uh, Asia would rise as a share of world output by about 20 percentage points from roughly 30% of world GDP to around 50% of world GDP in the period 1995 to 2025. That the gap of Asia and the richest countries would narrow very significantly. That the growth rates would be, in other words, much higher than the advanced economies. That whereas per capita income in the United States would grow at maybe, we said, about 1.8% per year during that 30 years, the growth of Asia would be four or five, and in some cases, six or seven percent per year per capita growth, depending on the initial conditions.
So, we published that in the spring, and I think it was about two weeks later that the Thai baht burst, uh, and that the Asian financial crisis unfolded. I never heard of the book again. Uh, actually, truth be told, how could you have a book about emerging Asia in the midst of the largest financial crisis, uh, in modern history for Asia? And out came a spate of articles, of course, everyone remembers them. "The Myth of the Asian Economic Miracle," "The Myth of This," "The Myth of That," "Asia's Finished," and so forth. And that was certainly the, uh, tenor of that time.
Of course, that is not how history unfolded. The crisis was a financial crisis. It wasn't an economic or systemic crisis. Uh, it was a financial crisis. It was a, a panic, in fact, badly handled by the IMF, uh, at the time, which put on draconian measures, uh, in the midst of what was a panic, and thereby aggravated the panic, made the downturn even worse than it had to be. But the recovery was also a V. Uh, in the end, uh, the economy went down, it came back up. But by the time it came back up, the book was completely forgotten. And in truth, I didn't even have a copy of it. Uh, I couldn't find a copy. It's probably somewhere in my library, but I didn't have a copy. So, I ordered it about two months ago from Amazon. You can get it for cheap, by the way. Uh, so I got a hardback, uh, copy for $4, and it came, and I looked at it for the first time in nearly 30 years. And there was one table that I remembered writing, and so I quickly turned to the table of per capita growth, and I asked, "So, how did we do?" And it turns out that in the aggregate, we were right on the line. And while we didn't have the same time series, which was a series by an economist named Angus Maddison, who has since passed away, so his series was discontinued. If you take the IMF series of GDP in purchasing power terms, which is what we were using for 1995 and 2025, we hit the percentage point mark exactly of a 20 percentage point rise of Asia in GDP.
The basic idea was not a crystal ball. The basic idea was a core economic concept of economic development, and that is the potential for convergence of poorer countries to higher income status. And the basic idea that poorer countries, poor for whatever starting point, have a headroom to grow faster if their institutions are well managed and well designed, so that you can have a higher potential growth rate. So, there was nothing fancy about the forecast in 1997 that we published. It was a standard conditional convergence regression model, a statistical model based on the idea that if you start poor, you have a faster catching up. And it fit the line very well.
And so, this is one reason why I like the long term, because I got completely wrong the two-week forecast. Uh, who knew that the Thai baht was going to collapse? Well, probably many of you here, but I certainly did not. I was paying no attention whatsoever to the Thai baht. I was paying no attention whatsoever to the banking sector in Indonesia, of whether it had a cushion or didn't have a cushion. And no matter what, uh, the IMF would get things wrong anyway, I'm sorry to say, very often, because it would take a short-term crisis and make it a fundamentals crisis by, I think, an overdiagnosis, uh, requiring all sorts of micro-surgery when what was really needed was some liquidity to prevent a fulminant financial panic from taking place.
So, I like the 25-year scenario much better. Uh, you get lots of shocks along the way, uh, lots of unexpected events, but more fundamental, uh, points can, can take hold. And what I find interesting about development is, of course, the more fundamental points. Now, there's something else to say. We got many things wrong about the country-by-country forecast. Some countries grew better than expected. China was one of them. Singapore was another. Some countries underperformed. Indonesia, Malaysia, Thailand, the Philippines, all were below the line that was set. India was right on the line. Interestingly, just the average, uh, prevailed. On the whole, uh, on average, uh, the, the weighted average was almost exactly right. Interestingly. So, there's nothing guaranteed about being on that convergence line. And in economic development, we call it conditional convergence, conditional on the proper management of the economy.
Now, Singapore, uh, of course, did not fit the line because Singapore did something with a lot of nerve, I have to say. The general theory is that as a country catches up, it slows down and then it converges with the countries at the forefront. That's what I confidently said would happen with Singapore. But Singapore had the nerve to just keep growing right through the limit, uh, and of course, becoming much richer than the United States in per capita terms, because Singapore is an extraordinarily well-managed economy and well-managed society. Arguably, and I'm not just saying it because I'm here, but arguably the best in the world, uh, in terms of governance, uh, very serious, very careful, very well thought out, very much planned, very technocratic, which is a technocrat I like. Uh, and, uh, therefore rather exceptional that Singapore was able to reach, in purchasing power terms, $150,000 per capita, and poor United States were stuck at $90,000 per capita. Uh, so Singapore just kept right through the line and set a different standard.
China outperformed, as I mentioned, by more than a percentage point per year growth. It averaged more than 7% per year during this 30 years in per capita growth terms. I regard China as an exceptionally well, uh, governed country, uh, in general, and in economic terms. It's one of the great success stories of, uh, economic history. Of course, at that scale, it is the unique success story of the world to have more than 40 years of rapid economic development. And when I, uh, I have not gone back yet, because I've just held the book in my hand the first time in almost 30 years, to try to understand why some countries are below the line and others, whether there's any way to assess it. But if I had to guess, and it is just a guess, what made the supercharged countries grow faster than the ones that fell below the line? If I had to guess, it would be the quality of education on average of the population. Uh, if you look at the standardized rankings of countries for 15-year-olds for their educational performance, I'm sure everybody knows that in the Program for International Student Assessment of the OECD, Singapore is number one in the world. It's got the highest test scores in math, reading, and science of 15-year-olds in the 81 countries that were evaluated in the 2022 cycle. Number two in the world list is the three, uh, uh, region grouping of China, because China doesn't do a nationwide assessment, but it does Tianjin, Beijing, and Shanghai. And those three come in number two in the world. Number three, if I remember correctly, is Taiwan. Number four is Hong Kong. Number five is Japan. And number six is Korea. And this is rather remarkable, by the way. Uh, Europe farther down, the United States, uh, somewhere in the middle. And, uh, in, uh, other countries. Vietnam way outperforming, uh, its relatively lower income level. So, very high performance, not in the top six, but quite high given the per capita income levels. And in Indonesia, Malaysia, Thailand, and the Philippines, below average. My guess is that this is really the difference of, uh, who is above and below the line. And it is why my favorite advice to give as a development economist to any place in the world is: invest in education, in quality of education. This is the number one investment of any society anywhere, no matter what its structure is. The future is your human, uh, talents, and children who are reaching their full potential. And this country does this, uh, with a stunning success, and I think it's the reason for the stunning success.
So, now it's time to look forward again. And I would like to write another book for next year about the world in 2050, but hopefully not create a financial crash in the process. So, I'm hoping that this is not causal, uh, but, uh, just coincidental. And when I think about the world, I'm trying to understand again the fundamental points of how we can judge the world looking forward to mid-century. And of course, it's a complicated world, and that's what I would like to spend a few minutes talking about in broad terms. That idea of economic convergence still surely applies in this world. In other words, we should expect poorer countries to grow faster than richer countries on average. The slow-growing countries of the world will be the United States and the European Union. They will be the slow-growing markets of the world, as they are today. Europe doesn't even grow right now. It's basically stagnant and could remain stagnant for years to come, in fact, at, because of also not such wise economic management. And the United States will grow at best at moderate terms, meaning 1 or 2% per year, uh, for the foreseeable future. There will not be any kind of supercharged growth. The rest of the world will grow faster, and on average, the emerging and developing economies as a group will probably grow two to three percentage points faster than the so-called high-income, or by IMF classification, advanced economies. Uh, and that's a very significant gap, and it's likely to persist.
So, in this sense, I think the broad idea of economic convergence applies. And if you're trying to think about the world in mid-century, that's a very good starting point. Nothing is sure about it, because terrible things can happen, bad accidents can happen, and these are issues that I want to raise. But broadly speaking, if we have a world of peace and adequate stability, we will have continued economic convergence.
Incidentally, the reason for this is a bit like a loaded spring that was unloaded. And by that I mean, the world in the year 20, in the year 1950, was a world of stunning inequality, where only a very small part of the world was, uh, at the technology frontier, and that was basically the countries of the North Atlantic region. And the rest of the world, almost everywhere, was very far behind. And Asia, as a share of world output, had declined to about 15 to 20% of world output, though the population was 60% of world output. And that was because we know that the century and a half from 1800 to 1950 had not treated Asia well. That was the year, the era of European imperialism. And the one thing about empires in general is they don't want their colonies to do well. They want to extract from their colonies. They don't want their colonies to develop. They don't want their colonies to be well educated. They don't want their colonies to be independent. They want to extract what they can from the colonies. They don't want to be competing with their colonies for industry and for capital. And so, by 1950, the world was so uneven.
What made it possible to have the era of convergence that I've been mentioning was the end of European imperialism. And so, this freed up the possibility of economic development to start. And the most important thing that it freed up was mass education. Because though countries differ in general, the imperial powers did not educate the local populations, uh, to anything like a normal standard. And in Africa, in 1950, though Africa had been under European imperial rule for 80 years by that point, the illiteracy was 95% in most of Africa. There had been no public education at all for the population. And that meant that Africa was completely impoverished. And in some countries, a handful of people had a high school education in total. In Mozambique, an example of that, where I think it was five people with a high school education at the time of Mozambique's independence from, uh, the Portuguese, uh, rule.
So, Asia returned to 50% of world output, and it will grow to 55% of, or 60% of world output, commensurate with Asia's share of the world population. We're unwinding the unnatural era of European imperialism. Of course, European imperialism emerged in part because Europe jumped ahead technologically with the era of the steam engine and mechanization. But that would normally have diffused to the world in the 19th century, except what diffused was political domination by Europe rather than the diffusion of technology and literacy, which did not diffuse the way that should have. That awaited another century, that awaited 1950 onward.
So, I say all of this because I think that this underlying trend of conditional convergence is the right hypothesis for our time. And that means truly a multipolar world, as we all talk about. The emergence of multipolarity that is now the discussion everywhere is fundamentally the emergence of a multipolar economic world. It's the spread of industrialization, but even more, it's the spread of technology everywhere. And what was the provenance and the property of a small part of the world in 1950 is now becoming a universal phenomenon. And, uh, we're a world, for that reason, of, uh, nearly universal literacy now, of course, universal completion of primary education, of course, but we will be a world of universal secondary education, a world of universal use of digital technologies, a world in which the basics are shared everywhere, if we stay peaceful, uh, and don't undermine this in, uh, in some fundamental way. To my mind, all of that is great news.
So, what could go wrong? Lots of things, unfortunately. Uh, and, uh, that's what I'd like to spend a few minutes on, uh, to understand. The first point is the arrival of a multipolar world is good news for the world, but taken as bad news in Washington. So, the former dominant country, the one that considered itself in 1992, at the end of the Soviet era, as the sole superpower of the world, is certainly not the sole superpower of the world. It never was, but it thought itself so. It acted so. And now, I think it's clear to everybody except maybe the President of the United States and a few other people, that it is not so anymore. And I regard this as highly good news, because it's not because the United States collapsed, but because the rest of the world has done quite well. And the result of this is we have what I regard as at least four great powers of the world today: the United States, Russia, China, and India. Uh, all major powers. They're all economically dynamic. Uh, they are all technologically sophisticated. They are all nuclear powers from a military point of view. Uh, not any of them can defeat the other, uh, in, uh, war. God forbid there should be one. Uh, any war between any of the two of them would end up destroying the world, uh, if it, uh, ran out of control. And so, this is a, a multipolarity that reflects a fundamental reality of world power, economy, and technology, which is that it's quite widespread, and talent is quite widespread in the world. And that, to my mind, is wonderful.
The problem is, if you were, uh, considering yourself the world's sole superpower, it's alarming. And so, I personally believe, it's not the favorite idea in the United States, but I believe the United States is the most destabilizing force in the world today, because it's trying to maintain a primacy that it doesn't have, can't achieve, and the attempt to sustain it is dangerous and provocative. And, um, I regard the conflicts that we have, for example, in Ukraine, as a war provoked by the United States to maintain its primacy. In the case of Ukraine, it's a war that was caused by the US trying to move its military into Ukraine on Russia's border, which in a multipolar world, you should not do. First rule of a great power facing another great power is: leave some space in between. Do not try to go right up to the nose of, uh, the other, especially in a nuclear-armed world. Leave some space, some time for decision-making, some prudence, uh, and so forth. But the United States regarded itself as all-powerful. And when the Russian government repeatedly said, "Please don't expand NATO. You promised not to do so, but you're doing so anyway. Do not go all the way to Ukraine." The United States said, "It's none of your business." And the Russians said, "Well, we do have a 2,100-kilometer border with Ukraine, so it is our business." And the United States repeated to this day, "It's not really your business. We decide. We're the world's superpower." So, that's the kind of danger that we are in, in my view, which is a multipolar world. First of all, requires prudence. It requires caution, and it requires the respect of great powers. This is extremely important, and it's going to be key to any survival and any good outcome. And respect means two things, in my view. One is that the great powers stay out of each other's neighborhoods. So, I call that spheres of security, not spheres of influence, because I don't think that, as I'll say, a great power can tell a small neighbor, "Don't trade with the other one," or interfere in that way. But I think a great power can say to another great power, "Don't bring your missiles and your military base to our border." That is too dangerous. And so, I want the great powers to stay out of each other's lanes, to not provoke each other. And in this context, I want NATO to stop crowding Russia. And I want the United States to stop bothering Taiwan. And I regard the United States as bothering Taiwan, not protecting Taiwan. Uh, to say to Taiwan, "We're with you, and we're going to send you weapon systems," is bothering Taiwan, in my view, not helping Taiwan. To keep Taiwan safe, the first thing I would do is not send them weapons. I would instead send a message: "We will not send weapons. We are not interfering in the One China principle, but we advise you work out things peacefully." And on both sides of the Taiwan Strait, there are very mature people that can work out things peacefully if it's not provoked from outside.
So, this is the first principle that I would like to avoid a crisis so that we can continue to have conditional convergence in this world, that the major powers stay out of each other's way, uh, and respect each other's boundaries. I do advise, I don't think it would be a wonderful idea for Mexico to invite Russia or China to have military bases and I think that, uh, on the US border. And I think it is a disaster for Ukraine to invite the United States to have military bases in Ukraine. So, countries on borderland should also behave prudently. This is, uh, not a game. This is really a matter of survival.
The other point that is equally important is that large countries, great powers, should respect their smaller neighbors. And in the United States, we have had a good test of this, because we had two Roosevelts as president. They were sixth cousins, actually, though they were close because the young Franklin Roosevelt both admired, uh, and, uh, was at the White House of his sixth cousin, Theodore Roosevelt, who governed at the beginning of the 19th century. And Theodore Roosevelt presided at the wedding of Franklin Roosevelt to Eleanor Roosevelt. So, these Roosevelts were very different. Theodore Roosevelt was a pure imperialist. Uh, and he believed that the United States could enforce its will in the Americas. So, we have long had in the United States the Monroe Doctrine from 1823, which told the European powers, "Don't meddle in the Americas." It was the statement, "Don't get in our neighborhood." But in Frank, in Theodore Roosevelt's time, he added what's called the Roosevelt Corollary, which declared the United States to be the policeman of the Americas and said, "We reserve the right to intervene in our neighborhood." And from that time on, the United States sent its Marines constantly to invade the neighboring countries of the Americas. This created a century of havoc, not quite a century, but it created decades of havoc, because it became almost a sport that if any government in Latin America wanted to do a social reform that impinged on a US corporate claim, the corporation would go to Washington and say, "We have an unruly leader, uh, do something about it." For example, when the government of Guatemala in 1953 wanted to have land reform for its impoverished peasants, the United Fruit Company went to its former lawyer, who was then the Secretary of State, John Foster Dulles, and said, "Our land is being threatened by this government." And the US Secretary of State called his brother, who happened to be the CIA director, Allen Dulles, and within a short period of time, the president of Guatemala was overthrown in 1954. So, that was how the Roosevelt Corollary worked, and it wrecked many countries for many decades.
But Franklin Roosevelt came into office in 1933. In his inaugural address, he said, "I want to do something different," and he called it the Good Neighbor Policy. And Roosevelt the Younger was our greatest president in history. When he said the Good Neighbor Policy, he meant it. During the time of Franklin Roosevelt, there were no interventions by the United States in the internal affairs of Latin American countries. He stopped all of those operations, and the situation improved for peace and development in the Americas. So, that's what I regard as the corollary to my proposition of spheres of security: great powers should stay out of each other's way. But that's no license for China to impose its, uh, uh, force in this region, or the United States to impose its force in the US region, or India to do so in South Asia, or Russia to do so in Central Asia or Eastern Europe. Good neighbors, but not threatened by other big powers. Uh, so that's how I view the world as potentially being safe in the future. And unfortunately, this is not Donald Trump's idea. Uh, we don't know what his idea is exactly, because it changes by the hour. But one thing seems likely, which is that the United States could well attack Venezuela within hours or days, because we've sent a major naval task force to the borders. They're already sinking ships and killing people, and are absolutely foolish and reckless senators in the US, which are by the dozen, by the way, are talking about war and talking about how great it will be and how we have to chase the president of Venezuela away. So, we could have a coup or a coup attempt or an invasion any time in the coming days, and this will just add to the world scene of tremendous instability. Trump, unfortunately, is not a stable character, and his government is a pretty much a, a bit of a gangsterism, unfortunately, in, uh, a lot of its dealings.
So, the first point about risk is geopolitics. We're in the nuclear age. We have space warfare, cyber warfare, nuclear war. We could easily have biowarfare. I personally believe that the coronavirus was created in the United States. Something that, uh, not, not a flippant idea. I studied this as chairman of a commission for three years. And I, I personally trace the virus to the University of North Carolina in a defense department program. And this is very, very serious. I don't think it was released intentionally. I think it was released accidentally. Uh, but I do think that it was a constructed virus. And I can tell you, so do most virologists, though they say differently in public, what they say in private. So, this is another example of how risky the world actually is right now, because of the instability of, uh, great power politics. So, that's one, one challenge.
A second, of course, huge challenge is the interlocking range of environmental crises that we face, that we are having an extremely difficult time addressing. And we have three mega environmental crises, each one of which is out of proportion to anything that we've ever faced on a global scale, and not one of which is being addressed right now. The first is the climate crisis, which comes from the emissions of greenhouse gases. And we've already breached the 1.5-degree warming limit that was set in the Paris Accord, and we will be within two decades above 2°C, because we're warming at the rate of more than 0.3°C per decade right now. And that rate of warming is likely to continue. So, we'll probably be above 2° warming within, by mid-century. This is very dangerous. Of course, it's dangerous in many, many ways. Every country here is facing floods, droughts, extreme storms. We just had a devastating Category 5 hurricane hit Jamaica. We're getting Cat 5 hurricanes every year now. These used to be spread out every 10 years, every 15 years, but the Caribbean has warmed so much that we're getting Category 5 hurricanes, one after another right now. We don't know the reports, but it hit Jamaica as perhaps the strongest hurricane on record, certainly a devastating hurricane, and we're still waiting to hear the news from yesterday, uh, yesterday's, uh, uh, landfall.
The second crisis related is the ecological crisis. The destruction of the rainforests, which is very much going on in Southeast Asia and in the Amazon. The potential collapse of the rainforest, because if you degrade rainforest enough, they turn to grasslands, actually, because a lot of the rain that hits the forest is generated by rain of the forest canopy, uh, upwind of the downstream places. So, if you degrade the rainforest, you break the hydrologic cycle within the rainforest itself. In other words, a lot of the rainforest is fed not directly by precipitation in the area of the forest, but by streams of water vapor that transcend across the forest through a repeated hydrologic cycle, uh, of evapotranspiration from the canopies of these forests. The Amazon is near the tipping point of turning into dryland grassland in certain parts of the Amazon. And the deforestation is continuing rapidly. And in this region, there's a lot of continuing deforestation because palm oil is really profitable. Uh, it's profitable and very destructive of the environment if it's carried out in an, in an uncontrolled manner. And that's just one of the many tipping points that we're hitting on the ecology. Last week, a major science publication said, "We have already reached the collapse of the coral reef systems in the world because of ocean acidification." Because the carbon dioxide in the atmosphere dissolves in the water and creates carbonic acid. It acidifies the ocean surface, and it kills the coral reefs. And so, we're already reaching the tipping points of the coral reefs and all that they entail in the fisheries ecosystems. There are many, many such tipping points being hit. And yet, we can't seem to stop that. And the third of these massive ecological crises is the mega pollution, uh, the toxic chemicals in the air, the water, the soils, the oceans, the microplastics that are now permeating food chains, uh, everywhere.
What's the problem? The problem is that to overcome these ills, you need a tremendous amount of intergovernmental cooperation. No country by itself can solve these problems. No ecosystem is one country alone. Your rainforests stretch across, uh, the whole ASEAN region. Uh, the Amazon is nine countries surrounding the Amazon. Brazil, the biggest, but nine countries need to cooperate in order to save the Amazon. And because of the lobbying power of the fossil fuel industry in this region, in the United States, in Canada, Australia, Russia, the Gulf region, it's very hard to turn off what has been started. And so, we haven't even peaked in emissions yet, much less turning the CO2 emissions downward. We're, we need to get to zero, but we haven't even peaked at the level of emissions, because the burning of coal, oil, and gas continues to rise. And the President of the United States is owned and operated by the oil industry in the United States. Do not think it's Donald Trump's ignorance when he says climate change is a hoax. It's his corruption, not his ignorance, because the Republican party is owned and operated by big oil in the United States. And so, he's repeating lines of lobbyists. His corruption is that he doesn't care. But this is why you hear what you hear, and why the drilling continues. And by the way, why we're about to invade Venezuela? Because Venezuela has the world's largest proved reserves of petroleum on the planet, larger than Saudi Arabia. And Trump wants those, and he thinks the United States can just take them. And that's what he's going to try to do. And I hope for the diplomats in this room that the world stands up and says, in a united voice, "You cannot do this." The world cannot stay safe if a power like the United States ruthlessly and recklessly tries to grab the resources of its neighbors. And so, I think we're going to be put to the test very quickly.
So, this ecological challenge is absolutely profound. And the main part of this ecological challenge is that it requires government cooperation to address. What is needed is technological change for the ASEAN region, for every region, move to renewable energy, to wind, solar, hydro, nuclear, uh, other zero-carbon energies. This is the key. And for ASEAN, it's possible to make a plan. In fact, the ASEAN Center for Energy will make, I think, a cutting-edge scenario of how ASEAN, as a region with an interconnected power system, can go to zero-carbon power. And this will be the key to get that done. But that will essentially be a political action, not a market action by itself. It will have to be determined by government that this is the safe thing to do. It will put ASEAN in a highly competitive position to do this, because companies want green energy to meet their own corporate accountability. So, it will be good for ASEAN to do it. But it will mean a major technological transformation, and it will mean an integrated grid. Uh, the grid will have to be interconnected to connect Singapore with Laos, as is already happening, but to make the connections more generally, and connect with China also, because ASEAN and China and Australia, through a submarine cable, would form a very effective, resilient, low-cost, zero-carbon energy system. So, that is the politics of these environmental crises is cooperation.
Incidentally, the United States has walked out of the Paris Agreement again, declared climate change a hoax, telling the G20, "Don't even mention climate change." Telling the G7, "Don't even mention climate change." What the United States is doing, sad to say, is handing the global leadership to China. Uh, that's fine from my point of view for China. China will have the capacity to take this on. But it is absolutely self-defeating for the United States. There's nothing that will come out of this beneficial for the United States. It's purely an own goal. Uh, it's has no rhyme or reason to it other than the short-termism of corrupted politics.
Now, the third dimension that puts a huge uncertainty for 2050 is the technological, uh, advancement, which on the whole is very positive for development. So, the advances in AI, in biotechnology, uh, in, uh, energy systems, uh, in, uh, space technology, all of it should be the great, uh, advancement of tools for achieving the rapid economic development that we are seeking, and it should be a great spur for, uh, for development, uh, and for convergence, I should say. The problem is that fundamental changes of technology are deeply disruptive and pose major social, political, and economic challenges of management. And I think everyone knows this. We started to have a discussion, a brief discussion before this talk, about what AI will do to the future of work. And it could be so good that we don't have to work in the future. Uh, most of the jobs will be done by computers, and my computer will stand up here and give the lecture, and it will be listened to by your computers, and we'll all, we'll all be off at the beach, uh, having a perfectly pleasant time, because all the work will be done by our robots and by the expert systems and, uh, ChatGPT 17.0, you know, and so forth. So, in truth, this could be a bonanza for well-being. And one could say, "So, what could possibly go wrong?" And we know everything, uh, because, uh, if you think about it carefully, there are truly utopian and dystopian futures that can come from the power of artificial intelligence and robotics. The utopian future is: we have a world of plenty. The machines do all the hard labor, and that gives us more time for leisure, enjoying our lives, raising our children, uh, going to the beach, uh, and so forth. That's not a crazy future. That's really a possibility. The other future, of course, is that at least my part of the world ends up either completely impoverished or working for Elon Musk, who is, uh, simply taking home trillion-dollar paychecks per year. Maybe that will become the norm. He wants a trillion-dollar paycheck this year. Uh, his chairman of the board, which is supposed to supervise him, but is his lead cheerleader, not surprisingly, says, "Sure, we have to give Elon a trillion dollars, otherwise he'll walk out of the company." If I were the shareholders, I'd say, "Bye-bye," uh, because I don't think that, uh, he is exactly worth the trillion-dollar paycheck from, uh, his company. But we'll see what happens, uh, in the next couple of weeks.
We are, because of this technology, at risk of the most unprecedented concentration of power ever seen in a small handful of individuals. And that, I think, poses, uh, big existential questions for us. Ten Americans have a net worth this morning of $2.3 trillion. Elon wants to raise it by a trillion, but already the 10 richest Americans have $2.3 trillion of wealth. That's a lot for 10 people. 10 individuals. That's not 10 companies. That's not 10 clans. That's 10 people. But they also happen to own a lot more. They own the White House. They installed the Vice President. They determine US government policy. They will own the cryptocurrencies, which will become our main currencies. They own all of the big platforms on which we communicate. They own YouTube, of course, which is, uh, the channel where I'm able to say sometimes things that are not in the US government's liking, but I don't know for how long. They own my email address. They own the full knowledge of every keystroke I've made in the last 10 years, no doubt. They own my privacy. They own the newspapers, like the Washington Post, owned by Jeffrey Bezos. They will own TikTok shortly, TikTok USA, because Larry Ellison is buying it on behalf of Benjamin Netanyahu. And Ellison will give it to his son, uh, as a nice gift. He's already given to his son Paramount Studios, Paramount Media, and CBS News. It's quite a world. And that's just 10 or so Americans. So, we're in a very strange concentration of power, I think, the likes of which we've never seen before. It has already destroyed democracy. We are democratic in form only. But we don't have a sensible non-democratic system. We have a privatized system, which is quite different, uh, in China, which is not a democracy. Uh, it is a technocracy, uh, and the business sector is subordinate to the government. Clearly, as Jack Ma found out, in the United States, it's the other way around, which is the government is subordinate to the, uh, particular corporate class now, uh, of, uh, the big tech sector.
So, we're in a governance adventure as well. The difference of the utopian and the dystopian vision of AI is politics. Will there be general well-being? Depends on how we use our surplus. If all the surplus goes to the top, then we will have mass impoverishment. Whereas, if the surplus is widely shared through universal services, then we will have shared well-being. But that depends on politics. Lo and behold, America's super billionaires do not believe in sharing. They are libertarian. They say, "You're on your own, and we're on our own." The only difference is I have a hundred billion dollars of wealth, and you have nothing. Uh, and so the, uh, justice of being on your own is a little bit asymmetrical, uh, in, in this regard. So, this, I regard as the other great obstacle to the shared prosperity of mid-century.
Let me end by saying that what an economist does in thinking about a, uh, an assessment of the world in 2050 is to ask: Given the resources that we have, given the technological knowledge that we have, given the demographic trends that we have, given the challenges that we have, what kind of future could we have for humanity? That's the question that we can ask. And that answer is: we could have an era of peace, cooperation, solutions to the environmental crisis, and decent living standards for all people in the world. There is no fundamental conflict between China and the US, or US and Russia, or any of the great powers. There's no reason for panic. There's no reason for saying we're 8 billion people, but only 5 billion can make it, or any fantasy like that. We are a world with the knowledge, the resources, and the technology to achieve sustainable development. The rest depends on our good insight, our ethics, and our government. Let me say, in truth, if the world would be governed like Singapore is governed, we would have no problems at all.
Thank you very much.