Anant Goenka: There’s so much changing with America and we all want to make sense of this absolute craziness…Let’s start with Howard Lutnick coming on a podcast run by a techie, very casually saying, Modi never called Trump so India didn’t get a deal. Sounds callous, insensitive to what trade means for people, for livelihoods. At The Indian Express, we explained how Lutnick’s timeline coincided with that of the India-Pakistan conflict…
Jeffrey Sachs: Lutnick’s statement was in the All-In show. I’ve participated in that show. That’s not only a group of techies. That’s the inside group to the White House. So people should understand that this is a tech-owned White House. They bought the White House. So Lutnick feels very comfortable in this environment because this particular group within the broader Silicon Valley, for example, hosted a dinner in California where they sat Trump down next to JD Vance and they told Trump, “this is your vice president.”
They created Mr. Vance. Who came out of their finance world…This is a group that is very heady right now. They’re intoxicated with their wealth and their power. They have it. They own the media. They own the white House. They own the AI. The Pentagon is desperately after them. So there’s a kind of intoxication of power right now. And that’s why, the Secretary of Commerce would go on a show and just casually make a statement. I don’t have to be careful, I run the world, and I’m with my friends, we’re the small group that runs the world.
To say that relations between the two giant economies of the world fell apart because the Prime Minister didn’t make a phone call is, of course, absurd. And at the same time, maybe even real. Real in the sense that it’s not a false statement, but a measure of how unreal a reality is. We have a narcissism in Trump and a power in the executive branch to do things by executive decree, by presidential order. That’s extraordinary. Instead of systems negotiation, diplomacy, technical working groups, the prime minister should have made a call…it shows the collapse of any systematic governance in the United States right now.
And asking for a phone call when we were at war with Pakistan.
Didn’t Trump end that war?
That was Trump’s claim and it became a diplomatic crisis of its own…So then it was even more loaded for Modi to make that phone call.
You have often said the American political system caters to America as a “military industrial complex.” It didn’t seem that Silicon Valley companies like Microsoft and Alphabet had the same relationship with US government as Boeing and Lockheed Martin. So what’s the relationship of Silicon Valley with the American military industrial complex today?
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That’s the new thing actually, the advent of AI in weaponry. And it’s pervasive, of course, it’s pervasive for intelligence…geospatial intelligence, it’s, absolutely fundamental for autonomous weapons, for drone warfare, that is being perfected in Ukraine and in Gaza right now. The Pentagon, which used to kind of run the show, and the old guard, major military contractors Raytheon or Boeing, General Dynamics and so forth, they’re now taking a back seat to Musk, obviously. SpaceX, which does the heavy lifting of Pentagon’s needs in space, to Palantir for facial identification to kill people and for many, many other things. And so my feeling is that we now have a military, industrial digital complex. Silicon Valley is extremely powerful in this because the Pentagon does not have in-house capacity.
So everything is being contracted out. And all the big tech companies now have this extraordinary position. They dominate their sector. They are all billionaires in US dollars. They own the mass media, control the daily discourse, whether it’s on X or whether it’s on Facebook or whether it’s on, actually the old guard media like Bezos is owner of the Washington Post, or (Larry) Ellison’s increasing media empire…
I can’t remember an analogy. I don’t think that JP Morgan or Vanderbilt or Rockefeller, though they were as rich as rich can be, had anything like the commanding power of this group. I should add one more obvious point, which is that they watch every keystroke we make and they listen to every word that we utter, whether it’s through our watch or through our phone. And so the surveillance and the loss of privacy is also pervasive. What an incredible combination of forces that has suddenly come on the scene in the last ten years. It is completely unaccountable.
These names we’re talking about, Googles and the Facebooks and Amazons…they have actually had an up and down relationship with the American government…
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With Trump, there’s no up and down. It’s just up right now. Congress is supine, barely exists. Trump is buddies with Musk, with Peter Thiel, with the insiders, all of this group. And of course, they’re competing with each other. Who can get to the moon first? Who can get to Mars first, who can do whatever first? Who can get to $1 trillion first? This is a lot of raw power.
Trump is the first Roosevelt ten times over, blatantly saying, we own the Americas. Even I want the great powers to go back to good neighbour policies in all of their respective domains, said Jeffrey Sachs. (AP photo)
What would be your advice to the interlocutors in New Delhi handling the India-US trade deal? We hear from our sources that there was satisfaction with the deal and then the goalposts kept moving.
The goalposts change that keeps happening. And that’s based on the whims and fancies of the President.
Does Modi pick up the phone, call Trump? You know, forget protocol and then he moves the goalpost again after all the work done.
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I wouldn’t…chase that phantom. I would rather that a great power like India together with other great powers behave like great powers, which is what we would like, peaceful, respectful relations. We would like to negotiate and we would like to do this properly. And I would like the United States to be run by grown- ups, frankly. With Trump’s specific personality, any concession he views as weakness…
We need transparency. Prime Minister Modi needs to be able to return to the politicians in this country and to the public and explain this is the process. This is how an agreement was reached. And I, of course, believe that the United States is not the be-all and end-all for India.
We can play a little thought game…Let’s just assume we have fast-forwarded three years and the Trump presidency is over. You are now the president. I’m going to list a few things. Right. Tell me what it is that you think can be reversed. And how? What is it that you can’t reverse? And why not? Let’s start with the tariff regime.
I’m hoping that within days of our discussion, the Supreme Court reverses it.
If the court allows it…
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Oh, if they say it goes, then of course I would reverse it. I think this is madness from an economic point of view.
Let’s get deeper on that… There is a view that America is actually winning this tariff war, 1% of GDP is coming from tariffs, reducing deficit from 6.9 to 6% of GDP. So there is a view that it’s working for America.
It depends what you mean by working. The tariffs are arbitrary, regressive, not creating any kind of real industrial policy, not leading to a new growth of employment in manufacturing, as he claimed, disrupting world trade, making everything less efficient and more uncertain. And I would rather have taxes other than these arbitrary tariffs in place.
One of the things that makes us say the US is winning is that the US dollar remains the world’s global currency. Few years ago, I asked Larry Summers about alternatives, and he gave me a very catchy line. He said, look, where will you go? Japan’s a nursing home. China’s a jail and Europe’s a museum. How do you think about this?
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Completely wrong. In ten years from now, the renminbi will be probably, I don’t know, 15, 20% of, of world transactions. It’s moving very fast in that direction. China is the world’s lead trade partner for at least 100 countries, if not 125 to 150. China saves a lot more than the US. China’s interest rates are lower than American interest rates, and the US has weaponised the dollar. Frankly, I think it would be foolish to continue in dollar transactions knowing that that is precisely the instrument that holds the rest of the world by the throat. And so that, to my mind, is why in India’s BRICs presidency it should support…
A BRICS currency?
Not a BRICs currency, but non-dollar settlements as a routine matter. Why should India say. ‘We will allow ourselves to be punished arbitrarily by any whim that the United States wants because our banks are vulnerable to being cut out from SWIFT…I don’t think China is going to stand for it. I don’t think Russia is going to stand for it. I know Brazil doesn’t want to stand for it. Why should India agree? Well, I would not allow my country to be abused this way. I would not do it.
The rise of China is viewed as a direct threat to the United States because the US expected a unipolar US world, Jeffrey Sachs said. (Express photo)
I believe that China will increasingly and systematically internationalise the renminbi in the coming years, and it’s taking steps to do that. The Chinese Interbank Payment System, CIPs is a part of that. The BRICs bridge is a part of this. So at a technical level, this is not a problem. If rupees are convertible into roubles or into renminbi or into other currencies, and they are selling things of interest, there’s no problem.
So is it in India’s interest to empower China and Russia by trading in that currency…?
Yes.
But China is Pakistan’s best friend right now.
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Where did the (Pakistan) General just have lunch? Was it in Beijing or was it in Washington with the president of the United States?… Who brought down Imran Khan, who has emboldened the Pakistani military in the last three years?
It’s all been the US more than China.
Yes. It was Biden who brought down Imran Khan…And Trump is playing his Pakistan game.
So can we (India) trust China more than America?
It’s not a matter of trust. It’s a matter that India should say: we need grown up superpower relations with China, stable… especially to have our mutual regard so that the United States isn’t dividing and conquering and isn’t bullying us. This is extremely important here. The two largest countries in the world. And by the way, by mid-century, they will be No. 1 and 2 in the world economy, overtaking the United States. They’re on a border with each other, which has not been stable and easy. And where the problems go back to 1914…Now the two superpowers should solve that problem, not let the British legacy continue to disrupt this, where the common interest of India and China in facing an unstable US and in protecting an international order are paramount.
To my mind, this is a bilateral issue with India and China. And I say on the Chinese side, just to be absolutely clear all the time, support India as the sixth member of the UN Security Councilpermanent seat. That’s extremely important for China. So don’t delay because the real problem is not India versus China. The real problem is that the Western imperial age is over.
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Going back to our game, would you hand Maduro back to Venezuela?
Well, I certainly would not keep presidents. I would not kidnap presidents of other countries…Let me just say I do not divide the world between democracies and autocracies like Biden. I don’t believe that you say I don’t like your government. I therefore intervene. So I don’t really believe in any unilateral actions by any country vis-a-vis any other country on these grounds other than through the United Nations.
So why did the Venezuelan market jump 100% the day after Maduro was captured?
Because the US has crushed the Venezuelan economy, and then they think that the US is going to stop crushing the Venezuelan economy. It’s very important to understand from 2015 onward, but especially from 2017 onward, the US has deliberately destroyed the Venezuelan economy. Their only export of value was oil, so it was surgically possible to destroy the whole economy by destroying the oil sector.
What people say now is, oh, Trump’s going to end that isolation. Stock market jumps because there could be survival again. So the US can put on the pressure. It can take off the pressure. The US drives this. This is what’s happening.
Is America involved with Iran right now?
In Iran, of course.
In Bangladesh?
Probably Bangladesh. I don’t know as many of the facts on the ground. I did know a lot more about Pakistan and Imran Khan. And there I think it’s as clear as it can be. In Bangladesh, it’s quite likely just given how things went down, this is how it happens. In Iran, there’s no doubt (that America was involved). Look, the former CIA director, Mike Pompeo, in his New Year tweet, sent his regards or made some statement about all the Mossad agents running in the streets of Tehran with the demonstrators.
I would like you to decode that. (Trump’s) MAGA base said they were voting for America to retreat from the world…But Trump’s going the opposite way by engaging with more countries and his voters seem to be liking that.
I don’t know what his voters like or not. No one cares about the voters in the United States. Nobody. Okay. No, not in foreign policy. No one’s been asked. I don’t even know if opinion surveys have been done on any of this, but none of this is because of American public opinion.
In spite of all the differences, I think if you look closely, it would appear that the only 2 countries Trump has some sort of respect for are Russia and China. So is he trying to just divide the world up as I’m the biggest guy on my side of the world. Let Russia manage Europe. I just want my borders protected… so I’m going to takeover Greenland. And China, do what you want with Asia. Is he thinking of the world like that?
Interestingly, there are glimmers of that: we will take the Americas, and you take your part. But it’s not quite like that. First, it really is: we’ll take our part. Canada is ours, Greenland is ours. And Panama is ours. Of course, Venezuela is ours. Colombia will be ours, and so forth. So the Americas are ours.
But, just a footnote: The Middle East is also ours. Because we have Israel and everything around Israel has to be friendly to Israel because we’re Israel’s protector. So that goes all the way to Iran, that includes all the Gulf countries, because we have military bases all through, the Arabian Peninsula, we have to control Yemen if we’re going to control, of course, the Red Sea and so forth.
So we extend there as well, the Caucasus, you might think that was in Russia’s neighbourhood, but the Trump Highway is going to cut through there because, really, Turkey is part of NATO and so it’s ours. And, we need that corridor because that has to make sure that Iran is there. As far as Southeast Asia is concerned, we can’t be too careful. Yes. It’s in China’s area, but these are our allies and this is our alliance. And ultimately, ultimately, we’re going to have that showdown with China. This is the big issue. So it’s not really like, it might seem right now with his good buddy XI Jinping. It is really still lurking in the American mind.
Back to our game imaging we are in 2029 and you are the US President, what would you do about the transatlantic, US-Europe relationship?
I would end NATO. NATO is a dagger aimed at Russia. That became its purpose after 1991. NATO was established in order to prevent a Soviet invasion of Western Europe. Okay, when Gorbachev disbanded the Warsaw Pact, the United States should have ended NATO. Okay. In February 1990, the United States and Germany promised Gorbachev that in the context of German reunification, NATO would not move one inch eastward.
That promise was immediately revoked, with the end of the Soviet Union and then denied afterwards. And why did NATO expand eastward? Because that was American control. And Zbigniew Brzezinski, our geo-strategist, in 1997, explained that if you control Ukraine, then Russia becomes a third-rate power. It’s blocked in the Mediterranean, it’s blocked in the Black Sea.
And so Ukraine is a pivot, and very important to control. And that’s why NATO was to move to Ukraine. Russia wasn’t dumb. It said, no, you won’t move to Ukraine. And that’s why we have the Ukraine war.
America broke its promise?
Germany, by the way, also. Because the promise was made in the context of German reunification in 1990. So I would end NATO. I would not invade Denmark. I would not invade Greenland. I would not make these outrageous claims. I would encourage the European Union and Russia to have a collective security arrangement.
I would extend France’s nuclear arms to a nuclear security umbrella for the European Union. I wouldn’t be naive in that, but it doesn’t take much to have a nuclear deterrent. And there should be a nuclear deterrent. But beyond a nuclear deterrent, Russia is not going to invade Europe. Except if there’s an incredible ongoing war. And so this is what really needs to be done.
Sounds like you want America to be a global cop, but also have other global cops?
I would like America to be a responsible country reflecting its power. But under the UN charter.
I’ve heard you mention the UN many times in the past. But it’s one institution that everybody’s kind of given up on but you keep going back to the UN.
That is the feeling. And that may be correct, by the way. But the alternative is, I believe, devastating. So it may be like one would have said about the League of Nations in the 1930s. Well, it’s a defunct organisation. That may be true. One of my closest intellectual counterparts is John Mearsheimer, who is our leading realist thinker.
We had him in our newsroom last year.
I respect him enormously. But I always point out his great book is called The Tragedy of Great Power Politics. And I’m saying all the time, we can’t accept tragedy. So that can’t be the last book on this subject. And that’s why I say we should save the UN.
In a multipolar world, which is what you’re kind of thinking about, does there have to be one leader? This thing that there is one country which is the largest economy and has to be the leader?
This is a very good point. By the way, Europe has been a continent at war basically since roughly 900 A.D. But they had some moments of peace. And one of the moments of peace was after 1815, after the Napoleonic Wars and the way that they made the peace which lasted, depending on exactly how you count. 30 years or by some counts, 80 years, in avoiding major war was what was called the Concert of Europe.
The rise of China is viewed as a direct threat to the United States because the US expected a unipolar US world. I always regarded that as both arrogant and economically naive because as an economist, I could look forward and say, China’s going to be a major power. I look the same way with India. India is a superpower. We’re in a multipolar world and we need the major powers to be actually working together.
So I recommended three things. One, is what I call “spheres of security”, which is that the great powers should stay out of each other’s neighbourhood. I don’t want Russia or China building a military base in Venezuela or Mexico, and they have no right to do it. Similarly, the United States has no right to build a military base in Ukraine or in Georgia or to arm Taiwan. None of this is the neighbourhood of a great power. Stay clear of that. That’s number one.
Number two, it’s a little harder with India and China fighting each other in the Himalayas. But respect, respect to buffer states like Bhutan, you know, like Nepal and so forth. And, demilitarise the region at the border for sure on both sides. These are spheres of security.
Second, “good neighbour policy”. We had two Roosevelts as presidents. One of them, Theodore Roosevelt, was an imperialist straight out. Now, his sixth cousin, Franklin Roosevelt, was, in my mind, the greatest president of the United States. He repudiated his distant cousin’s imperialism in the Americas. He said, we’re going to have a good neighbour policy. And he said, we’re not going to send the Marines to other countries.
Trump is the first Roosevelt ten times over, blatantly saying, we own the Americas. Even I want the great powers to go back to good neighbour policies in all of their respective domains. China has a big responsibility not to scare the wits out of its neighbour India. Similarly, it’s the hegemon of this region, but it shouldn’t dominate the region militarily.
And the third pillar of my foreign policy agenda is the United Nations. I refuse to believe it’s over until it’s over. And, to really be over means that we have reverted to full-scale war. Until then, I want us to avoid that war. I like the UN charter. I think the principles are right. I want the Security Council to work for the Security Council to work. We need India to have a seat on the Security Council. And by the way, while there are many claimants to a Security Council seat, India is the only absolutely, completely, 100% indisputable claimant, not Japan, not Brazil.
Nobody else measures up on every criterion to India’s size, scope, superpower status and needs to be there. And China needs to make that happen and track. But then the two will benefit from this. That’s my point.
I think America’s most successful export has been the American dream. It is now the world’s dream. You get a great education, work hard. You live a life of freedom. You get a house, you’ve got kids. You retire well and live happily. In stark contrast, is what you paint…your view of the military industrial complex, the deep state. How do these square up? Has the American dream been a lie?
The American dream was not a lie but it was just a piece of the truth. And America has multiple characters to it and multiple faces and multiple tendencies. And while you say that the American Dream was the great export of America, the great import of America was people from all over the world. And, as you know, when people here know the group in America that is the top educated, the most professional group are the Indian Americans living in the United States right now. It’s our professional class. So this has been a wonderful success.
And where did America’s great scientific leadership of the last 75 years come from? Well, you could say it came from Hitler, because Hitler pushed a whole generation of scientists to the United States. And the United States at the time opened its arms to them.
And I know I’m a direct beneficiary of that, because by the time I got to primary school several decades ago, we had a mathematics curriculum, which was modern, which could educate me beyond basic arithmetic and teach me something that would be technically valuable for my life. And that happened throughout the US economy.
Now, America had another face.
Without question, it is a settler colonial country settled by British colonies who then fought violently across North America for conquering a continent. And it was racist, exclusionary, slave owning, and genocidal.
It had a pluralism. And it had a racism. These were competing against each other.
And this remains true until today. I believe we have Trump because we had Obama. And by that, I mean we had an African-American president. That triggered a racist counterpoint. So I think that at a sociological level, without Obama, there was no Trump.
What’s happening in America is that diversity is still in its ascendancy. Demographically, the U.S. used to be 85% white European, basically. And now it’s something like 55%. It’s, of course, got its inequalities. Its divisions. We have a fantastic new Mayor, so we’re very excited about that. But that is America at its finest.
In my view. Trump is America at bringing out some of the White backlash. There’s also economic disgruntlement. There’s a lot of unhappiness because we’re divided in so many ways right now. No one talks…everyone yells at each other. The wealth inequality is extraordinary. The deep state role is so despicable. Racism is not pervasive in society, but it is a big part of Trump’s base. And so all of this, to my mind, explains our turmoil right now.
If we can get through this without disaster, if we can avoid world confrontation, if we can keep alive international law, if India continues its dynamic growth, (if) Africa joins finally, this economic take-off…we’ll have a multipolar world and we’ll have a United States, which actually then will have this wonderful strength that it has people from all over the world, and it will regain its composure and its sense it will not run the world.
One of the things the chief of the RSS, this is an organisation which is the ideological fountainhead of the BJP, told me…and you said publicly as well…that the world needs a new model beyond American capitalism. Is that model going to be a Chinese model now?
Countries all share in our technological revolution. If you walk down the street in Mumbai or Kolkata or any other place, everyone’s on the phone using the same apps, doing the same things. That’s true in an African city. That’s true in Moscow. That’s true, in Shenzhen. So in one sense, we’re all part of the same global technological systems. That’s undeniable.
At the same time, if you’re in India or in China or in Russia or in the United States, the culture, the nature of the discourse, the political systems are very distinct and the characteristic feel of the economies are also distinct. There is something called culture. It’s real political culture…President Xi Jinping has an imperial feel of a Chinese emperor. To me, President Putin has the feel of the czar. But that’s not terrible. That’s culture.
And Modi?
And Prime Minister Modi. I think he really reflects and helps to bring about a new pride in India as a superpower, which it is. I feel culture is really reflecting something that is persistent and ongoing and not to be feared, but to reflect diversity. And so I am rather impressed by Chinese statecraft in many, many ways. I also know that it’s been honed, at least since 200 BC, with the Han dynasty’s centralised, administrative, bureaucratic, Confucian system. You can see that all the way to the present. That’s not going to be the system in some other places. And so I don’t want us to have one hegemonic; we all are going to live together with AI.
We’re going to live together with the climate crisis. We’re going to live together with green technology, electric vehicles. Many things will be common for the world, but we’re going to have our diversity. We’re going to have our own culture. We should respect that. We should understand that’s not the threat.
China’s not going to take over India. Believe me. India is not going to take over China. China is not going to invade the United States. Russia’s not going to invade Europe. We should all calm down, put away our missile toys and other things and get on with the issues that are really important for well-being.
