All CFR Presents

CFR members are invited to a special off-site invitation-only event at the International Monetary Fund.  Ahead of the IMF and World Bank Spring Meetings, Managing Director Kristalina Georgieva discusses the outlook for the global economy, key policy priorities for member countries, and the agenda and goals for the week ahead. This event is hosted in partnership with the International Monetary Fund. Upon arrival, all visitors are required to go through security screening and present a government-issued (e.g. driver’s license/passport/UNLP) photo ID to receive a visitor pass. This process might take up to 15 minutes. Please note seating is very limited and there is no virtual component to the meeting.

Panelists discuss the implications of U.S.-China relations on the international economy, including how tariff negotiations, supply chain restructuring, and technological competition impact global business. President Donald Trump’s meeting with Chinese President Xi Jinping in Beijing, originally scheduled for March 31, was postponed and will now take place on May 14 and 15.    This meeting is presented in partnership with CFR’s China Strategy Initiative. This meeting will be held in New York, Washington, and on Zoom. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Ray Takeyh, the Hasib J. Sabbagh senior fellow for Middle East studies at CFR, will speak about the U.S. and Israeli attacks on Iran, regional effects, and implications of the conflict for Iranian co…

Following the announcement of the 2026 World Food Prize Laureate(s), recipient of the prestigious $500,000 award, panelists discuss how finance, science, and geopolitics are reshaping global food security, and what policies can strengthen our resilience against climate shocks, supply disruptions, and growing strategic competition. Awarded by the World Food Prize Foundation, the World Food Prize is the preeminent global award recognizing individuals who have enhanced human development and confronted global hunger through improving the quality, quantity or availability of food for all.

Panelists examine what Americans think about U.S. foreign policy, drawing on recent polling and survey data to explore public attitudes toward the United States’ role in the world. Speakers will analyze results from the 2026 Edelman Trust Barometer, Gallup's World Affairs survey, and 2025 Reagan National Defense Survey. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.  

Deputy Assistant to the President and Senior Director for Counterterrorism Sebastian Gorka discusses the administration’s priorities for addressing counterterrorism threats, including ongoing challenges posed by Jihadist networks and the Iran war. Please note there is no virtual component to the meeting.

Heidi Crebo-Rediker, senior fellow at the Council on Foreign Relations, discusses the findings from her recent report, Leapfrogging China’s Critical Minerals Dominance. She highlights the national security implications of supply chains for critical minerals and the levers available to spur innovation, attract investment, and strengthen domestic processing and manufacturing capacity. Tom Burns, executive director of the Nevada Governor’s Office of Economic Development, outlines Nevada’s strategic investments in infrastructure for critical minerals and its role in shaping U.S. economic and defense priorities.

Panelists discuss the primary theme of the 70th UN Commission on the Status of Women, ensuring access to justice and addressing legal discrimination, as well as the implications of proposed UN reforms for women and girls. This meeting is presented in partnership with CFR's Women and Foreign Policy program.

Dr. Anwar Gargash, diplomatic adviser to the president of the UAE, discusses the rapidly evolving conflict involving Iran, Israel, and the United States and its implications for the Middle East, including the diplomatic and security challenges facing Gulf states. 

Panelists discuss the ongoing geoeconomic consequences of the conflict in Iran, including global energy flows and oil prices, economic development and AI buildout in the Gulf region, sanctions on Russia, and inflation and interest rates as markets respond. This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. This meeting is presented by the Maurice R. Greenberg Center for Geoeconomic Studies.

This symposium explores the development of the U.S.-led international order from the post–World War II era to the present, examining the foundations of American global engagement, the trajectory of the post-Cold War period, and the policy shifts of the Trump era. Together, the panels analyze how these distinct phases have shaped U.S. foreign policy, international institutions, and patterns of global cooperation and competition. Click here to view the full agenda. This Hauser Symposium is made possible by the generous support of the Hauser Foundation. This symposium is also part of CFR’s America at 250 Series. To mark the 250th anniversary of the U.S. declaration of independence, CFR is dedicating a year-long series of articles, videos, podcasts, events, and special projects that will reflect on two and a half centuries of U.S. foreign policy. Featuring bipartisan voices and expert contributors, the series explores the evolution of America’s role in the world and the strategic challenges that lie ahead. Please register for all the sessions you wish to attend. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Members may bring a guest to this event.

Panelists discuss Iran's current political climate, concerns for civilians on the ground, and how the rapidly evolving internal dynamics are shaping U.S. objectives as well as broader regional and international considerations. This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Panelists discuss recent developments in U.S. trade policy and where it is heading. This meeting is made possible by the generous support of Robert Pozen. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

A special screening of the documentary Jean Monnet, the Adventurer of Europe, followed by a panel discussion on Monnet’s legacy and its relevance for international cooperation today. The film examines the astonishing life of Jean Monnet, a self-taught businessman who became a key architect of European integration and is often referred to as the “Father of Europe.” Built around unpublished archives and a rarely broadcast interview conducted shortly before his death, it explores Monnet’s role in coordinating Allied cooperation during the two world wars, advancing postwar European unity, and strengthening transatlantic ties. Monnet’s life and work offer insight into the development of international institutions and collective action in the twentieth century. The documentary will be shown in French with English subtitles. Please note there is no virtual component for this meeting.  

The launch of the new Council Special Report, Leapfrogging China’s Critical Minerals Dominance: How Innovation Can Secure U.S. Supply Chains, will feature a fireside chat with Assistant Secretary of Energy Audrey Robertson, followed by a panel discussion with report contributors. Speakers will discuss the need for a U.S. critical minerals strategy that accelerates innovation and develops emerging technologies to leapfrog China's dominance of global supply chains. Please register for all the sessions you wish to attend. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. This meeting is presented by the Maurice R. Greenberg Center for Geoeconomic Studies.

A wide-ranging conversation about national security policymaking, leading a military service, and civilian control of the military with Christine Wormuth, drawing on her decades of service at the Pen…

Under Secretary of War for Policy Elbridge Colby discusses the U.S. National Defense Strategy under the Trump administration. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

For two-and-a-half centuries, the United States has faced a challenging world. Some of its responses have bolstered U.S. interests and values. Others have not. CFR asked members of the Society for Historians of American Foreign Relations what they considered the best and worst U.S. foreign policy decisions. This event will discuss the results of the project. To mark the 250th anniversary of the U.S. declaration of independence, CFR is dedicating a year-long series of articles, videos, podcasts, events, and special projects that will reflect on two and a half centuries of U.S. foreign policy. Featuring bipartisan voices and expert contributors, the series explores the evolution of America’s role in the world and the strategic challenges that lie ahead. The CFR Young Professionals Briefing Series provides an opportunity for those early in their careers to engage with CFR. The briefings feature remarks by experts on critical global issues and lessons learned in their careers. These events are intended for individuals who have completed their undergraduate studies and have not yet reached the age of thirty to be eligible for CFR term membership. We are pleased to extend this invitation to you through the recommendation of a CFR member. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

CFR experts assess the United States and Israel’s strikes on Iran, examining the implications for the region and U.S. policy. Ahead of the briefing, read analysis from Elliott Abrams, Max Boot, Steven A. Cook, Elisa Catalano Ewers, Linda Robinson, and Ray Takeyh on the impact of the February 28 operation.

Diana S. Gerson, associate executive vice president of the New York Board of Rabbis, Mary Graw Leary, professor of law at Catholic University of America Columbus School of Law, and Shadi Kourosh, associate professor of dermatology at Harvard Medical School, discuss cross-sector efforts to combat human trafficking. Rachel Vogelstein, associate professor of professional practice and director of the Institute of Global Politics Women’s Initiative at Columbia University’s School of International and Public Affairs, moderates the discussion. 

President and Chairman of EXIM Bank John Jovanovic discusses advancing the interests of American exporters and manufacturers abroad while securing domestic supply chains. Please note there is no virtual component to the meeting.   

As the war in Ukraine enters its fifth year, the international context is changing rapidly, including the prospects for a negotiated settlement. Much is at stake, and it is essential that the challenges ahead be fully appreciated. Panelists will explore three critical issues for securing Ukraine's future: achieving a just and durable peace, ensuring its long-term security, and helping it rebuild and recover from the ravages of war. This event is part of the Council’s Special Initiative on Securing Ukraine’s Future which provides timely, informed analysis and practical policy recommendations for U.S. policymakers and the American public. Click here to view the full agenda. Please register for all the sessions you wish to attend. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Members may bring a guest to this symposium. This event is part of the Wachenheim Center for Peace and Security which is made possible by the generous support of the Sue and Edgar Wachenheim Foundation.

CFR experts discuss the impact of the Supreme Court's decision on Friday and President Trump’s policy options with a deep dive into the legal aspects of the ruling and other authorities at the president's disposal. For additional resources on tariffs, read CFR polling conducted with Morning Consult, “What Americans Really Think About Trade and Tariffs.” BEHBEHANI: Welcome, everyone, to today’s Council on Foreign Relations briefing on tariffs, our second since the Supreme Court ruling on Friday. This will be a deep dive into the legal aspects of the ruling and other authorities at the president’s disposal. The contents of this discussion and Q&A will be on the record, and a recording will be posted online at the conclusion of this event.  This briefing is a part of the Council’s ongoing mission to inform U.S. engagement with the world, work that also includes the analysis and resources posted across our channels including ForeignAffairs.com and CFR.org, where you’ll also find the results of recent polling CFR conducted with Morning Consult on what Americans really think about trade and tariffs.  Let me now hand it off to Inu Manak, a senior fellow for international trade; and Jennifer Hillman, senior fellow for trade and international political economy who’s joining us in London. Over to you, Inu.  MANAK: Thanks so much, Lilly. And thank you, everyone, for joining us this afternoon for this media briefing on trade and tariffs.  On Friday, the Supreme Court struck down the sweeping tariffs that President Trump had imposed on most U.S. trading partners, starting with executive orders on Canada, Mexico, and China, the fentanyl orders; and then the reciprocal tariffs in a different executive order that relied on the International Economic Emergency Powers Act. By a vote of six to three, the justices ruled that the tariffs exceed the powers given to the president by Congress under IEEPA, and this means that he can no longer use IEEPA to levy tariffs. So there’s a lot to unpack in terms of what that ruling says, how the justices fell on a number of different issues, and we want to take the time to break that down.  So, with that, I want to turn to Jennifer and ask you to sort of explain to us sort of what the central reasoning was of the Court in applying their ruling of striking down these tariffs.  HILLMAN: Well, thank you very much. And I, too, am delighted to be here, so I welcome all of you joining us.  You know, I think the good news for all the lawyers, if you will, is that this is a pretty clean and straightforward opinion. I mean, the bottom line is that the reasoning of the Court starts with the Constitution. And Article I, Section 8 of the Constitution gives the power to impose taxes and tariffs, and the power to regulate foreign commerce, to the Congress, not to the president. And therefore, the only way in which the president can impose tariffs ever is if the Congress has delegated that authority to the president in some way or in some form in legislation.  So the question before the Court was simply a straightforward one: Did IEEPA—did the Congress when they enacted IEEPA, did they hand over tariff authority to the president? And you know, again, Chief Justice Roberts said very clearly in the opinion the answer to that question is no. And I’ll quote you just one line from the opinion. What he said is, “Our task today is to decide only whether”—and again, he’s speaking of a specific phrase in the statute—“the power to”—quote—“‘regulate’ importation”—end quote—“as granted to the president in IEEPA embraces the power to impose tariffs. Answer: It does not.” So what the Court did is simply look at the statute and say, what does the statute say? And the only part of the statute that the administration or anyone argued could even arguably apply is the part of the statute that gives the power to the president to regulate importation or exportation. And so, again, the question before the Court is, can you read that word “regulate” to mean tariff? And in the end, the Court said no.  And I would add that, you know, the real basis for the Court’s determination in terms of saying, no, regulate does not mean tariff or tax is that they really did draw this line between what is a regulatory power and what is a taxing or tariff power. And they said that regulating means something very different from—you know, from tariffing or taxing, and that because the IEEPA statute does not use the word “tariff” or “duty” or have any other indicia or any other words that describe something like a tax, that it cannot be read to provide this tariff authority. So it’s a clean, straight-up answer of does IEEPA permit any tariffs at all ever, and the Court in essence said no.  MANAK: Right. And you know, they did look at all the other verbs that were in the statute, right, and found that none of them said tariff or duty of any kind. So it really showed that they were looking at that clean statutory interpretation.  But there’s another point here, too, and I kind of want to get your thoughts on this too, because Roberts invoked the major questions doctrine as well in writing his opinion, and that requires executive branch officials to identify sort of a clear congressional authorization when they seek to exercise some sort of major power that has some significant political or economic consequences. So could you kind of explain to us the reasoning here on major questions and then, also, why only three of the justices relied on this in that opinion?  HILLMAN: So the major questions doctrine is something that has been to some degree codified, if you will, or at least described more specifically by the Supreme Court only in the most recent years. And it is, again, as you say, this doctrine that if it is something that involves a major question, major impact in terms of the U.S. economy, the Congress has to have been very clear about its delegation of that authority. And so the question before the Court as Roberts saw it in this opinion was, was it very clear that the Congress actually delegated tariff authority to the president in IEEPA, and obviously looked at the language and said, absolutely not, how could it possibly be clear if, you know, the Congress never even used the word “tariff’ or “duty” anywhere; put in no language about how you would determine how much is the duty, for how long would it be in place; no process for any comment or notice from anybody; that it doesn’t look like or read like any other tariff statute, so how could it possibly be clear that the Congress intended to give the president this big power to impose tariffs?  So that was pretty much walking through the major questions doctrine to say just it’s not here. I mean, this is—there’s no doubt—nobody disputes that imposing this high tariffs across all goods from all countries is a major question, so there was no debate about that. You know, this is well beyond any of the other prior major questions doctrines. That was not the question. The question was, OK, then once you apply this doctrine, do you see this kind of clear indication?  And the reason I think that the—that the three, if you will, liberal justices—I mean, Sotomayor and Ketanji Brown Jackson and Elena Kagan—did not include the major questions doctrine is two things.  One, they started out by saying you don’t need it—you don’t need the major questions doctrine; just a straight normal statutory interpretation under any regular form of interpretation would get you to the result that this statute does not provide for tariffs, so you do not need to reach the major questions doctrine. That was their first argument.  And secondly, I think they don’t want to embrace the major questions doctrine because it has been used in the past, again, by the conservative justices to strike down a lot of the initiatives that President Biden, President Obama, and others have invoked that would allow them to address things like climate change, or environmental measures, or health-care measures, or others. Again, Biden, again, had struck down his efforts to try to cancel student loans during COVID because of an argument that under major questions it was not clear that the Congress was giving that authority. A number of the powers to shut down coal-fired power, again, under the Clean Air Act, it was—it was ruled, no, you know, there’s not this clear delegation. So I think for some of the justices—and again, for many Democrats—they don’t like this major questions doctrine and they think it’s creating an unrealistic standard to expect the Congress to have anticipated all kinds of things that could come up every time they pass a piece of legislation, to specify every single time the statute can be used, how it can be used, when it can be used—that that’s really asking too much of the Congress; we won’t get there. And we certainly won’t get there with a lot of older laws that are not going to be updated or amended, you know, in the near term. And so I think there is in that sense a real reluctance to embrace in any fulsome way the major questions doctrine unless you really have to, and they said you don’t have to.  MANAK: Yeah. I found that all very interesting. And I thought Justice Gorsuch’s opinion was really fascinating because it showed that there were disagreements in the reasoning, and not just with those justices that thought the ruling didn’t need to address major questions and that the statutory interpretation, as you mentioned, was enough, but also with the justices that invoked major questions for previous cases with less economic significance and didn’t do so in this instance.  So I kind of want to turn a bit to the dissents, then, too, to unpack those, you know. So how did the justices come to a different conclusion than the majority opinion on this one? What were some of the things that you found and that could highlight for that?  HILLMAN: Yeah. So, again, it was Justice Kavanaugh writing the dissent, joined by Justices Alito and Thomas—writing, I would say, the main dissent. And I think he started out by saying I don’t think you apply the major questions doctrine in this instance because he perceives that there is effectively a foreign affairs exception to the major questions doctrine, and that whenever the matter involves the foreign affairs that there should be great deference to the president; that you simply should not expect, you know, again, the Congress to have given out every little—you know, to have been very precise in their—in their statutory language; in general, basically saying that if it falls under this broad—what he would describe as a very broad umbrella of foreign affairs, as long as you’re under that foreign affairs umbrella that the president should be given significant discretion and significant deference, and that if you require the imposition of this major questions doctrine you’re not giving the president the deference that I think Justice Kavanaugh thinks he should have gotten. So a lot of his opinion was really all about saying, you know: This is different. This is foreign affairs. This is national security. This is exactly the area in which we should not be second-guessing the president. We should allow him to do what he has done in this instance because, again, it fits within this broader umbrella.  MANAK: And he also mentioned something else that I thought was interesting where he talks about IEEPA’s power to block imports includes a range of options, right, so there’s the lesser tool of tariffs, that that should be allowed. And so I think this is really the idea that Trump talked about, too, in the press briefing—you know, basically, why would IEEPA allow him to ban trade but then not impose, like, a 1 percent tariff? Can you explain that, just like what’s the reasoning here?  HILLMAN: Yeah. And this was an interesting one because it was actually even brought up during the oral argument, where during the oral argument the argument was made that you—you know, all of these other powers of IEEPA to nullify, to void, to block, to embargo, to do all of these things form this kind of doughnut, and then in the hole in the middle you have tariffs; why would you take out a tariff authority? And again, I think Justice Kavanaugh is addressing that issue in saying, you know, look, if you’re going to allow all these much harsher, you know, penalties, all of the—you know, to go all the way to embargoing imports or banning them altogether, why wouldn’t you allow this lesser power of tariffs to be imposed? That makes no sense that you have sort of two ends of a continuum and yet you don’t allow a power in the middle.  I mean, I personally think that Justice Roberts did a very good job of answering that question in the majority opinion by saying tariffs are simply different in kind. You know, it is not a matter of degree and it is not a continuum; that tariffs, because they are taxes and involve revenue, you know, are simply different in kind in terms of what they do, and different in terms of where they fall in the Constitution. They fall as a straight-up power of the Congress, not any power of the president. There’s not even a hint of shared power with respect to tariffs; they are solely the power of the Congress. And therefore, they’re different in kind than these other authorities given under IEEPA.  I would only personally add my own sense is, you know, I do think there’s also a big difference in saying that the IEEPA gives a power to regulate imports, to ban imports, to embargo imports, et cetera, because that still remains a power in the power of the president to decide when and what the embargo applies to. But when you think about tariffs, the decision about whether or not to import or not rests with the importer. I mean, if they’re going to choose to spend the 50 percent, you know, additional cost to bring something in with a 50 percent tariff, that is then giving the power to the private importer. It’s no longer a regulatory power by the government because it is not the government that is, in that sense, enforcing or controlling anymore.  So, again, I think there is—there is reason to say that there is a distinction in kind. But that is clearly what the—what the Kavanaugh dissent was trying to say, is: No, they’re not. They’re just on a continuum, and that it doesn’t make sense to give the president only the sort of nuclear option without giving him something less than that.  MANAK: Yeah. And I also found that really interesting. I thought he did a good job of explaining sort of why there wasn’t this continuum in that regard. And you know, there were other things that he addressed, too, that we saw in the—in the dissent as well, though, so a few other claims that were made, really Justice Thomas’ additional dissent and what he wrote there. So maybe could you tell us a little bit about that as well and those other issues.  HILLMAN: So, yeah. So, yeah, Justice Thomas wrote his own dissent, you know, again, meaning no one else joined him in this, which to me I think was quite, quite striking, I mean, and went very, very far in the direction of saying there should be a very significant amount of power given over to the executive branch. What Thomas’ solo dissent really goes through is, again, among the other powers that the Constitution gives solely to the Congress is the power to legislate. Article I, Section 1 of the Constitution, you know, gives the Congress the power to pass all—to make all laws, to do all legislation. And what Thomas said is, yes, but that really means that the Congress can still delegate a lot of its authority, even its legislative authority, and that the only aspects that remain solely with the Congress are ones that he refers to as core legislative authorities, which is those that threaten life, liberty, or property. And again, he tries to justify this on the basis of a number of, you know, old historical texts.  But I will say to me this is breaking really new ground. I mean, most people would say, you know, they don’t see anything in the Constitution that would suggest that somehow the powers of the Congress are limited to only those things related to life, liberty, or property. When the Constitution uses the word all legislation, you know, it has historically been presumed to mean all. But Thomas is clearly trying to start down this road of saying, you know, you can cut back significantly the amount of power that belongs to the Congress to only this narrow lane of life, liberty, and property, and everything else falls to the president. Obviously, he didn’t get any other justices on that opinion, but I think he’s putting down some markers.  MANAK: Yeah. I thought it was a really interesting read and one where it seemed like he was saying that Congress can delegate its tariff powers away completely in his reasoning. But that’s not the majority view, certainly in what we saw in the ruling.  So I guess maybe stepping back, if we were to, you know, make sense of all this in one big-picture way, and not just in terms of the page count—because this was a big ruling, and I think we all spent all of Friday combing through it, and again all weekend—if you’re just, you know, talking to someone and explaining to them, what should they take away from this? What’s the big takeaway at the end of reading those 170 pages and what it means for the Congress in particular?  HILLMAN: Well, when I step away from it, I would say this is a huge victory for the Constitution of the United States. It’s a huge victory for the Congress. It’s a huge victory for the notion of a separation of powers. It’s a huge victory for the rule of law. I mean, it is, again, the Court saying that the Constitution still matter(s), and when the Constitution says tariff power belongs to the Congress that’s what it means. It means tariff power belongs only to the Congress.  And so the fact that the president has already, you know, signed an executive order that says they will no longer collect any of these IEEPA duties—as of today they’re no longer collecting IEEPA duties—says to me that, you know, when the Congress—I’m sorry, when the Court speaks like this, very clearly, and makes it really clear—there’s no ambiguity in this decision; it is straight up you do not have the authority to impose tariffs under IEEPA ever—it to me is very important to say that there is still this notion of a separation between the powers of the Congress and the powers of the executive branch, and it is clearly still the Court saying and we, the Court, get to decide where that line is drawn between what is a power that the president has and what is a power that the Congress has; and we’ve drawn the line, and tariffs fall on the side of the line that belongs to the Congress.  MANAK: And I guess importantly, you know, this decision only applies to IEEPA. So then what does it mean, stepping back, for trade policy overall?  HILLMAN: Right. Right. So I will say, again, I think this is an extremely significant and important decision from a political, legal, constitutional separation-of-powers standard—very important, very significant. From a trade law standpoint not so much, because at the end of the day with respect to trade and tariff policies because the ruling here is a narrow one—you know, does IEEPA, just IEEPA, provide for tariffs—you know, it in the end of the day has a much more limited reach. And in this context that we’re sitting in with all of these tariffs on all of these goods all over the world, I think it is important to understand that the only thing that was eliminated by this decision is the tariffs that were applied pursuant to IEEPA.  So left in place are all of the tariffs that have been applied under the national security statute Section 232. So that’s the 50 percent tariffs on steel and aluminum and a number of their—or their derivative products, 50 percent on copper. It’s the 25 percent on autos and auto parts. It’s the tariffs on wood, and underneath that kitchen vanities, and bathroom vanities, and other wooden furniture. Again, it’s—the whole series of those 232 tariffs remain in place. They’re not touched, not impacted in any way by this ruling of the Supreme Court. Similarly, the Section 301 tariffs that we’ve had since the first Trump administration on about $360 billion worth of goods being imported from China, those tariffs, again, are not touched by this IEEPA ruling. Nor would any future 232, or 301, or antidumping, or countervailing duty, or Section 201.  So nothing in this opinion changes any of those other trade statutes, the way in which they’re implemented, the way in which the investigations are conducted under them. None of them are impacted by this IEEPA ruling. So in that sense from a trade standpoint a much more narrow decision.  MANAK: And IEEPA itself was left untouched in other ways, right? So there are other applications for IEEPA that the president could essentially use for different actions entirely.  HILLMAN: Yeah. And a part of me thinks that this may have been one of the reasons why the Court went down this very clean, you know, sort of just know there is no power to do tariffs, because one of the things that I think might have been very problematic is if they’d actually gone into IEEPA and started rendering an opinion that would try to define some of the prerequisites that are part of IEEPA. So, again, the president, whenever he invokes IEEPA, can only invoke IEEPA if he has made a declaration that there is a national emergency that has as its genesis outside of the United States, with that emergency being described as unusual and extraordinary—an unusual and extraordinary threat to the United States. And then whatever he does once he’s declared that emergency must deal with the particular emergency that he’s declared and nothing else.  And so before the Court even in this IEEPA case was a lot of argument about can you really say that our trade deficit, which is one of the—one of the bases for a huge number of the IEEPA tariffs, is, in fact, you know, subject to that unusual and extraordinary test? If we—because we have been running a trade deficit in this country for fifty years in a row, every single quarter for fifty years. So, again, a big argument before the Court is: How can you describe that as unusual or extraordinary? An event that’s happened every single quarter for fifty years is not unusual and is not extraordinary.  Ditto the fentanyl tariffs. There was a huge argument—so these were tariffs that were put on Canada, Mexico, and China in theory because they weren’t doing enough to deal with the fentanyl problem. But again, it begs the question before the Court: Well, what does a duty or putting a tariff on a T-shirt, or a teddy bear, or, you know, sort of anything else actually have to do with fentanyl, that that is not dealing with the issue? The Court, I think, did not want to go down that road, because as soon as you go down that road it also affects how the—how the Court would define unusual and extraordinary when it comes to imposing an embargo, when it comes to imposing sanctions, when it comes to imposing the other measures that are routinely imposed under IEEPA.  I mean, IEEPA is routinely used when we impose sanctions. When Russia invades Crimea, we put on sanctions. We use IEEPA as that authority. Et cetera. So I think the Court wanted to make sure that the rest of IEEPA and the authority for the president to engage in those kind of emergency actions remained completely intact, and they achieved that. They did not make any effort to try to define any of these terms, or to put any guardrails around them, or to try to create any lines within IEEPA itself. And so in that sense I think the IEEPA statute really was left very much in place for what it has traditionally been used for.  MANAK: And one other issue that the Court did not bring up was that of refunds, and this seems to be the big issue that a lot of folks are asking about. What is going to happen with all these refunds? Do we know anything yet, or are we still waiting for more information?  HILLMAN: I don’t—I don’t—I personally don’t think we’re waiting for anything, and I think the Court did not have to address it. Again, what the Court said is just these IEEPA tariffs are illegal. And to me, then, you just revert to, then, what is the law? And the law to me is very well-established: Once a duty has been declared illegal, you are absolutely entitled to a refund because, again, the collection of the duty from the very beginning was never lawful. So it is an unlawful exaction of money, you know, from the importer of record. So to me, this is a really straightforward question. Yes, it will be hard, in the sense that there’s going to be a lot of requests, you know, for refunds. But there is a well-established process by the customs service to do these refunds.   They’re going to end up going down two different lanes depending on what’s the status of the actual import. So, again, for all of the entries—so, again, just to back up and, you know, sort of see where we are, when any import comes into the United States right now the importer of record has to file a customs declaration that says, this is the good that I’m importing. This is its value. This is the amount of tariffs that I owe. And they put all of that into their customs declaration. And they pay the duty. And then Customs has up to 315, really 314 days is what they really generally use, to basically close the books, to check it all, to make sure did you really declare correctly, did you declare the right amount, did you pay the right amount of duties? So there is this period where the entry has come in, the goods are out there in the U.S. economy somewhere, but the books, the accounting, has not been finished. In customs parlance, this is called liquidating the entry.   So during any of that period until the entry is liquidated, the importer also has the right to go back in and correct their declarations. So I think what you will see in the vast majority of cases is the importer of record is going to go in and say, I want to correct. This is, you know, a post-entry correction. I want to correct my entry. I made a mistake. I included IEEPA duties. There are no IEEPA duties. I’m correcting my record. And then Customs will liquidate the entry, and will see that too many duties were paid, and will have to immediately pay a refund with interest. And I think the vast majority of transactions, that’s what’s going to happen.  If, on the other hand, the books have closed, the entry has been liquidated, the paperwork is done, it’s over, then you do have to formally protest. And you have 180 days from the time that the—that the entry was liquidated to protest. And you’re basically saying, Customs, you made a mistake. You charged me IEEPA duties. I don’t owe IEEPA duties. I want a refund. Those may be a little bit more complicated. And, again, it absolutely requires you to file a protest. But, again, importers are entitled to these refunds. Technically, when that happens, you know, Customs has to, what they call, re-liquidate the entry. But I think there is a lot of certainty there.  The Justice Department, the Trump administration Justice Department, in cases before the Court of International Trade, said, we promise if these IEEPA duties are deemed to be illegal, we will allow reliquidations. We will not object to reliquidations. And we will pay refunds. So the Trump administration is on record in court pledging to the judges of the Court of International Trade that they would allow these reliquidations and that they would be paying refunds. So I think legally it is very straightforward and there’s no ambiguity. It’s now a matter of getting the kind of—just the mechanics working, and working as quickly as we can.  MANAK: Great. So I’m going to sort of shift gears a bit to sort of the reaction to the ruling as well. But before I do that, just want to remind everyone, if you do have questions please do raise your hand, because we’ll make some time to get to as many questions as possible. So, Jennifer, Trump was quick to respond to the court ruling and put new tariffs in place. Announced new tariffs under Section 122. A different tariff statute that a lot of people had to quickly learn, and many of us had said is something that the president would definitely use if he had to revert back to something. So could you walk us a little bit through Section 122 of the Trade Act of 1974? What does this this law allow the president to do? What are some of the constraints around it? And is there a possibility that this may also face a legal challenge?   HILLMAN: Yeah. I mean, thank you. I mean, part of it is I think to me it was not surprising that the president chose Section 122, because it is the only statute out there that would allow the president to impose duties on all goods from all countries in one go. All of the other tariff authorities that he could use—232, 301, 201, anti-dumping, countervailing duty—are going to be country specific or product specific, or both. And all of those statutes are going to require a fairly extensive investigation, findings of fact, hearings, and a whole lot of process. So they could not be done quickly.   So the one statute that would allow this kind of quick across-the-board tariff is Section 122. So what it does—when 122 was drafted, you know, way back in the early ’70s, when, you know, as the United States was beginning the process of coming off of the gold standard. As many of us might remember, you know, the dollar used to be pegged to the value of gold. And we had a lot of, you know, bricks of gold at Fort Knox that when, ultimately, you know, anyone holding dollars wanted to exchange for gold, they could do that. When gold got very tight, Richard Nixon finally decided we can no longer do this and took the United States off of the gold standard.   When we did that, then our currency was allowed to float. And when it was allowed to float, there was a concern that if there were to be a huge shift in the value of the dollar, you know, very quick depreciations of the dollar, or a significant balance—international balance of payments problems, given the pegging of the dollar, that there needed to be a remedy. And one of the ways in which you fight back, if you will, on these currency depreciations or on runs on the dollar is to stop imports.   So Section 122 was drafted to say that if the president finds that there is a fundamental international payments problem facing the United States, and that fundamental international payments problem can come from, you know, a concern over an imminent, you know, crashing of the dollar, an imminent falling of the dollar, or from trade—I’m sorry, not trade—deficits, balance of payments deficits where the United States has trouble making its payments in dollar currency, or where we’re trying to get an international agreement around stabilizing exchange rates—if one of those three things is happening and there needs to be restraints on imports, including tariffs, the president is authorized to do them.   So it’s a statute that comes out of kind of older history related to the dollar and the value of the dollar. It’s never been used because as long as the dollar has been floating, you know, many would say that, you know, you’re never going to need this. There’s sort of no such thing anymore as the same idea of—that we were—that we were in, you know, many years ago when the dollar—when the dollar was floating. So again, it’s an old statute, but they’ve clearly picked up on it. This is what they’ve done. They’ve announced—they’ve put out an executive order for a 10 percent tariff across the board on, again, all goods from all countries, except for a list of goods that they are allowed to take out that are items that are either not, you know, in significant supply in the United States, or are in other ways critical for supply chain management and other things.   So they have excluded certain critical minerals, currency, metals and bullion, energy products, natural resources, you know, fertilizer, and then certain other agriculture products, beef, tomatoes, oranges, et cetera, pharmaceuticals. So, again, there’s a list of products that are exempted from this tariff. These were announced on Friday, shortly after the Supreme Court’s decision. The next day, the president posted on social media that it was not going to be a 10 percent across the board tariff, it was going to be 15 percent. That I know of, we’ve not yet seen an executive order implementing that 15 percent. So I don’t know whether we’re going to stay at the 10 percent which is—which, again, is in an executive order, or whether the president’s social media post is going to be realized and they’ll soon issue a new executive order raising the tariff.  MANAK: Yeah, we’re still waiting to see that come through. I was checking the Federal Register. I had not seen anything yet. So waiting to see whether it’s 10 or 15 percent. One thing I will say about those exemptions too, they clearly track on exemptions that were already granted to the IEEPA tariffs, and some exemptions that were noted in the deals that were negotiated—both the frameworks and then the reciprocal trade agreements.  HILLMAN: Yeah, and I should note, I mean, they, for example, exclude goods from Canada and Mexico if they meet the U.S., Mexico, Canada Agreement, the USMCA, rules of origin. Those are exempted. So, yes, you’re correct. I think that’s exactly where this list came from is the goods that were exempted from the IEEPA tariffs or were agreed upon in these deals to be exempted from the tariffs. That’s the list that is not going to have these new Section 122 tariffs applied.   You asked about a challenge. You know, and this one to me—you know, again, I think you are hearing a lot of talk of people that may want to challenge these tariffs. I mean, obviously for the importers, you know, you can imagine that if you’re going to get your tariffs back—you’re going to get your refunds back from IEEPA, you might want to challenge for the same exact reason. So even if it takes a year to litigate the case, if at the end of the day you get all of your tariffs back again in the form of a refund, you know, there may be some value to the importers in doing that.   There are others that I think want to litigate this case, again, to make this point about the separation of powers, and/or to make the point that the president cannot just invoke Section 122. He has to actually make the requisite factual findings. And for some, their view is you can’t make this finding, that the United States is currently experiencing a fundamental international payments problem. I mean, everybody else’s debt is denominated in dollars. I mean, we don’t have the same kind of problem that countries that are desperate to actually be able to exchange their currency for dollars—we don’t have that. We are the world’s primary currency. So there are some that would argue, you know, we—you know, the president has not and cannot make the required showing. And that therefore, this statute should be challenged because it, again, is the president, you know, bringing on powers that he does not have.   You know, from my perspective as a lawyer, I think this is a harder case to litigate because it’s asking the court not just to read the statute and figure out whether the power is there. There’s no question there’s a power in 122, if it’s properly invoked, to impose tariffs. The issue is whether a court is going to second guess the president’s judgment that there is a fundamental international payments problem. And that’s what he’s declared. And the question is, I think the courts are going to be more deferential to the president with respect to that determination.  MANAK: That’s an excellent point. And it is time limited, so 150 days might be something that companies are considering as well in the challenge, that this could be potentially over in that time period. I want to sort of turn to some of the participants who have their hands up. Maybe, Lilly, if you can help me figure out how to bring these folks online, that would be great.   OPERATOR: We will take our first raised hand from Kelly Malone.  Q: Hi. Thank you so much for taking the time today.   The president and then, through Scott Bessent, has indicated that obviously 301s are going to be instigated for separate countries. Can you talk through how that might play out? Obviously, coming from a Canadian standpoint, what would Canada see in a 301 investigation? (Laughs.) But, you know, when you’re looking at this from a global 301 investigation standpoint.  HILLMAN: Yeah. I mean, I do think I would not be surprised to see them initiate Section 301 investigations against basically all of the countries that we have these deals with, because I think they’re looking for a legal basis under which they could keep in place those deals, including the tariffs that were imposed under those deals. And the only basis on which they have to impose tariffs on, again, whether it’s Canada or whether it’s any of the other trading partners, is through some other authority, because the Section 122 tariffs are going to go away in 150 days.   So, again, Section 301, just to review for everyone else, again, requires an investigation done by the United States Trade Representative’s Office. And there’s two roads within Section 301. One is what is referred to as the mandatory road, meaning you must take action if you find that your trading partner is violating the terms of a trade agreement that they have with the United States, and that that violation is burdening the United States. So, again, I think the vast majority of the agreements are not going to be down that road. They’re going to be down the other road, which referred to as the discretionary road, which is to say that, you know, there’s an investigation to determine whether or not any practices by any of our trading partners are unreasonable or discriminatory, and burden U.S. commerce.   And if they make those findings, then, again, the president has the discretion to impose trade measures, including tariffs, on that trade partner. And, again, just to remind everyone, that is the authority that was used by the first Trump administration against China, where the finding was that China engaged in a number of intellectual property theft as well as technology transfers, you know, that were taking U.S. technology. To the result of, you know, causing a burden on U.S. commerce of $50 billion. The Trump administration started out by imposing tariffs on $50 billion worth of Chinese imports, and then China retaliated, and the whole thing escalated. But they used that core Section 301 finding and kept amending and amending and amending to get to the point where we are right now with tariffs on about $360 billion worth of goods from China.   So it’s my understanding that that’s what they want. They want to get that grounded, you know, 301 determination against all of the significant trading partners where they can then amend it once it’s been found to be the core bedrock of a legal authority to impose tariffs.  Then you—then you amend it, you change it over time so that it can adjust to the various things that may happen under a trade agreement, again, because we have to remember whatever the countries may or may not agree to in terms of a tariff level, the president does not have the authority on the U.S. side of the table to charge those tariffs unless he’s got a 301 investigation, you know, once the 122 tariffs expire.  MANAK: Yeah, and I would just add for those looking for information on what might be in those 301 investigations I think the National Trade Estimates report is always a good guide to see what some of those unfair trade practices are that USTR is concerned about and has been bringing up for the last year now as the basis of some of the negotiations that have been ongoing as well.   So let’s take another question from the audience.  OPERATOR: We’ll take our next question from Sea Winter (sp).   MANAK: Please go ahead.   OPERATOR: They’ve lowered their hand. We’ll go to Caroline Atkinson next.   Q: Hi. Thank you very much. Incredibly clear and helpful description. I’m not a trade expert so I particularly enjoyed it. Thank you.   I have two questions. One is how do you place one of these 301 findings, and is it just something that can be done by USTR? It’s not something that is subject to a court ruling or anything like that.   And then the second point is, is there any way that Congress has a role in what will be happening next or are all of the—is the administration able to continue to act under its—under previously given authorities?  Thank you.  MS. HILLMAN: Two excellent questions, so maybe I’ll take the second one first, which is the Congress’ role and, again, because I think at this point it’s a fairly, in some ways, contested issue.   Clearly, the issue with respect to the existing statutes is not contested. I mean, the statutes are what they are. The president has the authorities that he has under those statutes. The issue always becomes did the president actually do both procedurally and substantively what the statute requires.  So even on the Section 301—your sort of other question was can it be done by USTR or are the courts involved—I mean, the courts are involved in 301 if there is a challenge that says you didn’t do this right. Either you didn’t do the process, the procedure right, you didn’t respond to comments, you didn’t give enough opportunity, you didn’t actually listen to the comments, you didn’t take them on board, or, substantively, you know, 301 limits you to these findings and you didn’t make them or, you know, again, there was something that was wrong.   The role for the Congress is an interesting one because I think whatever else we’ve seen is, you know, Congress is starting to try to find ways to push back on what the Trump administration has been doing. I think you saw that.   I mean, the Senate three different times passed resolutions to try to get rid of one or more of the IEEPA tariffs by terminating the underlying emergency. You saw, again, pretty rarely, enough House Republicans break from the Trump administration and also vote in the House against one—you know, the tariffs being imposed on Canada.   So you are starting to see the Congress kind of break away a little bit because, by and large, these tariffs are very unpopular and so they’re generating a lot of political pushback. You also are starting to see the Congress more and more say, we’ve got to restrain the president. We’ve got to rethink this approach where we hand over this authority and then don’t have enough ongoing say in it.   And the third area where the Congress is increasingly saying, you know, we do have a role and you’re—and you’re not abiding by it is whether or not any of these deals that are being negotiated, do they have to be approved by the Congress.   I mean, it used to be the case that, you know, trade agreements were supposed to be approved formally by the Congress. USMCA, you know, all of the various FTA agreements, all of them have gone through a significant congressional process to be adopted.   And so the issue is these agreements that they’re negotiating, they’re not in that sense full-on free trade agreements but are they nonetheless agreements that will require some, you know, approval process through the Congress?  And what you’re seeing is, you know, across the board the Democrats saying, oh, yes, they do require a formal agreement, you know, by the Congress and the—and the Republicans at this point are still more or less saying, no, the president can do these on his own.   So I think the role of Congress is something to watch. There’s a lot of, you know, ideas out there to start amending these trade statutes in order to give back more power to the Congress over trade.   In terms of 301, there are—there are requirements for reexaminations and for updating. But, by and large, the answer is once there’s been this fundamental finding of, you know, again, unfair discriminatory practices that burden U.S. Congress—commerce, I’m sorry—those 301 findings can hold.   I mean, we’re seeing now that we’re still having these 301 tariffs applied to China even though that investigation was done in 2017. So, again, once they’re in place, there is—there is times at which they have to be reviewed. But, fundamentally, those tariffs can stay in place for a very significant amount of time.   MS. MANAK: Thank you, Jennifer.   And, you know, to round off the discussion on 301, too, I was looking back at previous investigations and typically they take from five months to a year. The China investigation started in August 2017, didn’t conclude until March 2018, so that was seven months for that one to play out.   Now, Ambassador Greer said there would be expedited 301s so I would imagine within the next five months of that 122 tariff expiring we probably will have those 301s completed. But you’re right to point out about Congress as well having maybe some role.   One thing I will add, and I encourage you all to take a look at our recent survey on what Americans think about trade where we found that a plurality of Americans think that the president should not be allowed to impose tariffs without approval from Congress, so there certainly is this desire for some sort of guardrail on that action and the growing concerns over affordability may sort of moderate what the president does on tariffs after this hundred fifty days is over.   So let me just thank you, Jennifer, so much for taking your time to share with us today your thoughts on this really important issue. We all at CFR will be covering this in detail in the coming days, weeks, months, and years so please tune in.   And let me turn it back to Lilly to close.   BEHBEHANI: Thank you all for attending today’s media briefing.   If you have any questions, please email communications at CFR.org, and I’ve put the report in the chat that Inu was talking about. It’s great. And as a reminder, this event was on the record and will be posted to our event shortly—our website shortly, excuse me.   Thank you all.  (END)   

**Please note that this symposium will take place FULLY VIRTUALLY due to inclement weather.** This symposium will feature a fireside chat with Andrew Ross Sorkin on the lessons from the 1929 Wall Street crash, followed by a panel discussion on the present-day risk of a bubble, and how policy makers should respond. Copies of 1929: Inside the Greatest Crash in Wall Street History will be available for purchase during the symposium. The Robert B. Menschel Economics Symposium, presented by the Maurice R. Greenberg Center for Geoeconomic Studies,was established in 2014 and was made possible through a generous endowment gift from Robert B. Menschel while a senior director at Goldman Sachs. Since Menschel’s death in 2022, the symposium continues in his honor and memory. This symposium is also part of CFR’s America at 250 Series. To mark the 250th anniversary of the U.S. declaration of independence, CFR is dedicating a year-long series of articles, videos, podcasts, events, and special projects that will reflect on two and a half centuries of U.S. foreign policy. Featuring bipartisan voices and expert contributors, the series explores the evolution of America’s role in the world and the strategic challenges that lie ahead. Please register for all the sessions you wish to attend. Log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Members may bring a guest to this event.

It has been nearly a year since the Trump Administration informed Congress of its intent to fold some functions of the U.S. Agency of International Development (USAID) into the U.S. State Department, and to discontinue the rest. Please join our speakers, Andrew Natsios, executive professor at George H.W. Bush School of Government at Texas A&M University and former administrator at USAID, and Mark Dybul, senior advisor at Georgetown Center for Global Health Practice and Impact and former executive director at the Global Fund to Fight AIDS, Tuberculosis and Malaria for a discussion of the year without USAID, and what might come next on U.S. engagement on global health and international development. 

CFR Experts discuss the Supreme Court's decision on President Trump's tariffs and what comes next. CHANG: Welcome to today’s Council on Foreign Relations media briefing on the Supreme Court’s ruling on tariffs.The contents of this discussion and Q&A will be on the record and a recording of this will be posted online at the conclusion of the discussion. This briefing is a part of the Council’s ongoing mission to inform U.S. engagement with the world, work that also includes the analysis and resources posted across our channels, including ForeignAffairs.com and CFR.org, where you will find the results of recent polling CFR conducted with Morning Consult on what Americans really think on tariffs. So I encourage you to go to CFR.org to see that piece, among others.  Let me now hand off to Eddie Fishman, senior fellow and director of CFR’s Center for Geoeconomic Studies. Over to you, Eddie.  FISHMAN: Thank you, Ben. And thank you all for getting on this call on relatively short notice. I know that the Supreme Court decision today really upended all of our calendars, but hopefully we can spend good time together over the next thirty minutes talking about the issue. So I’m going to just give a few comments at the top, and then I’m going to turn to my colleagues. And we’re all sort of going to discuss our own reactions to what happened.   So I think, as everyone knows, earlier today the Supreme Court delivered a pretty clean decision saying that IEEPA, the International Emergency Economic Powers Act, does not authorize the president to impose tariffs. I think that’s a very important development because many of the tariffs that Trump has put in place are under IEEPA, although, as I think Brad probably will talk about, Section 232, which is a very important part of the tariffs as well, has not been affected by this decision. It sounds like what President Trump’s strategy is right now is invoking Section 122 of the Trade Act, which allows him to impose a 10 percent across-the-board tariff for 150 days. But critically, that can only stay in place for 150 days. And so the administration is very likely to use that time to initiate a multitude of additional investigations under Section 301 and 232 as well, to try to resurrect a lot of the tariffs that are in place now.   The one point I’d like to make before I turn it over to Brad to talk about some of the implications from his angle, is that I think almost no matter what the administration does in terms of reviving these tariffs under different authorities, I think that this does represent a sea change for how President Trump conducts foreign policy. Over the last year, Trump has used tariffs not just as a way of raising revenue for the government or protecting domestic industries from foreign competition—which is obviously another use case of tariffs—he’s really used tariffs as a catch-all geoeconomic weapon. He’s used tariffs as a stand in for sanctions and export controls, a way to pressure countries to do what the United States wants from a foreign policy standpoint. This is what we’ve seen with secondary tariffs on India for buying Russian oil, or threatening tariffs on trading partners of Iran or Venezuela.  That is no longer possible. He can no longer credibly threaten to impose tariffs at the stroke of a pen on a country because they’re not doing what he wants them to do. And I think this has really substantial implications, because no matter what happens with the 232s or 301s, they do take quite a bit of time to go through those investigations. And it’s not something he can just do at the drop of a hat. So I think this will very substantially change Trump’s foreign policy. I think it’s quite likely that it means that he starts using sanctions and export controls more than he has in the past, as opposed to tariffs. And I do have some concerns that it makes the use of military force more likely as well, because if Trump doesn’t have his favored tool, which is tariffs, at his disposal, other tools that he very clearly has authority over, like sanctions, like export controls, and like the use of military force, will become more attractive by comparison.  So with that, Brad, I’ll turn it over to you.  SETSER: Well, thanks, Eddie. I very much agree that this is an important decision that takes away the unique style which Trump has deployed tariffs in his second term, because it doesn’t—you know, the IEEPA statute, as Trump had interpreted it, had become a mechanism for putting tariffs at any rate on any country over a weekend. And so it had become this catch-all tool for leverage. All the other tools that are available limit the president’s flexibility in various ways. So Section 122 doesn’t allow the same scope for exemptions and exclusions. They have to be based on a balance of payments rationale. It’s limited to 15 percent. Not as threatening. And, at least in principle, it goes away after 150 days. Section 301, which is a(n) investigation into countries’ bad trade policies, requires an investigation. And it requires identifying the policies that you would like your trading partner to change. It can’t just be used because of an unrelated foreign policy issue. And Section 232, which is a sectoral tariff, at least in theory there has to be an investigation that shows—not just in theory; I mean, there has to be an investigation that lays the legal basis for arguing that imports in that sector are a threat to national security. So the timing, the cadence, of trade policy will change. *Correction: product categories may be exempted under Section 122 tariffs.  I think the structure of the tariffs will also necessarily evolve. There are a set of countries that had substantial tariffs under the IEEPA authority, whether it was a reciprocal tariff or a fentanyl tariff, and those countries that had tariffs way above 10 percent right now will see those tariffs drop even if Section 122 is used to impose an across-the-board 10 percent tariff.  Conversely, and I think this is going to be an important question to learn more about, there is the possibility of excluding countries that don’t contribute to a balance of payments problem from the Section 122 tariffs. It’s not clear if you can exclude products, so some of the electronics, some of the pharmaceuticals that have been coming in pretty close to tariff free may temporarily have higher tariffs. That’s, at least, a possibility. I think, you know, serious lawyers will be quickly commenting on that.   And then it is possible that it may be difficult to exclude a country like Taiwan, which has a 20 percent tariff, but most of the chips that it produces and electronics it produces are coming in under an exclusion so the effective tariff is much lower. An across-the-board tariff—but Taiwan has a clear surplus with the U.S., a big global surplus. It’ll be interesting to see if you can exclude Taiwan or if some products from Taiwan will face a higher tariff temporarily.   So I think there’s a lot of technicalities that are important here, and for many, many countries the reciprocal, the fentanyl tariffs, were the most important, but for some countries the Section 232 sectoral tariffs were equally or as important. That is certainly true for a big auto exporter because the auto 232 was a substantial 25 percent tariff on many countries. They got negotiated down to 15 (percent) for those that did deals, 10 (percent) for the U.K. Those countries like Korea, like Japan, they’re going to breathe a sigh of relief that the reciprocal tariff is gone but they are still under substantial tariff threats and I think that will influence how they view the maintenance of the various deals that have been struck. I would say the same is true with respect to Europe because of the importance of autos and also because there remains an open 232 investigation into pharmaceuticals, which is a huge European export, a huge Irish export, which currently isn’t tariffed but the ability to tariff is there.   And then I think it’s significant to talk about how this impacts China because China, on one hand, had, after the Busan deal a 20 percent additional tariff on top of the, roughly, 10 percent effective tariff from Trump’s first term. That now goes down to 10 percent, which is actually 25 percent on a lot of tariffed products and zero on a lot of others. That 10 percent broad effective tariff will be topped up by the 122 10 percent, but the tariff on China will go back down to around 20 percent, which is, I think, significant because China is one of the tariff peaks.   And I think it’ll be interesting to see if the Section 301 cases quickly go after China. There is a very strong legal basis for doing so. The 301 from Trump’s first term hasn’t been settled in a legal sense. The phase one deal was never implemented. So it is relatively straightforward to put new tariffs on China. Will those new tariffs just replicate the 122 10 percent after 150 days? Will they try to replicate the 20 percent? And how will China react if it is sort of singled out for additional tariff treatment the first 301 ahead of the Trump-Xi summit?   I think these are sort of significant issues that the administration will be forced to clarify in relatively short order.   FISHMAN: Thanks very much, Brad, for your always very insightful comments.   I’ll now turn the floor over to my esteemed colleague Rebecca Patterson.   PATTERSON: Thank you, Eddie. Thank you, Brad. I enjoyed hearing your comments, too.  So I guess a couple things for me. One is kind of what do we know, what do we still not know, and, I mean, obviously, now we have the Supreme Court decision on IEEPA. The president doesn’t have the authority to levy tariffs under the Emergency Economic Powers Act. And we know from the press conference that new tariffs are coming, starting with the ones—the balance of payments, Section 122, in the coming days, followed by others. So we have clarity on some things.  In terms of areas where I think there’s still a lot of uncertainty that is going to, I believe, continue to cause businesses to tread carefully, frankly, in the U.S. and overseas. One is that the Supreme Court did not mention refunds. That’s something President Trump was very vocally unhappy about during his press conference today. And he, the president, suggested that there could be years of litigation for refunds to come through. I think that is a significant amount of uncertainty. If companies don’t know when or if they’ll get their money back, how should they plan for new hiring, new business investment? So that’s one set of uncertainty that I look forward to having a little more color on, clarity on.   Another issue that I think is important to keep watching is what does this mean for all of the agreements that have been put in place over the last year? My perspective would be that countries most likely are going to want to just keep their heads down, see what tariffs President Trump and the White House push forward in addition to the Section 122, which seems a certainty. But, you know, you have to look at things like Japan. In the last week, Commerce Secretary Lutnick announced that the first tranche of Japanese investment, $36 billion in three different U.S. companies. Do all those things still go forward? All this promised foreign direct investment into the United States, which is very important to support jobs in the United States, does that get slow walked? Is it happening on schedule? What happens if companies or countries decide to take a step back? So that’s another area I’m going to be watching pretty closely.   And then I guess the third area, which is a little more tangential to what we learned today from the court, is USMCA. So we have another huge, huge trade negotiation going on this year, the review of USMCA, the former NAFTA agreement. That review is expected to be done, I believe, by July 1st. And talks have already started. They’re well underway. And there’s a question whether we get just a full renewal, a renewal with some changes, or if there is not a formal renewal, in which case this becomes basically a zombie deal and you have to have annual approval processes for it and, in theory, it could sunset after sixteen years. Now, to me, it feels like our three economies are so deeply integrated it’s almost hard to believe that anyone would let this deal lapse. But between now and then, and then, again, is going to be July, I can imagine we’ll have some drama in the negotiations. And that could create volatility and, again, feed into uncertainty.   So I guess my bottom line is that even though we have gotten clarity today from the Supreme Court on the IEEPA tariffs, we’re far from having certainty on a broader basis on trade. And so while we are seeing the U.S. economy supported substantially by technology related investment in capex and wealth creation that’s happened through a stronger stock market, last year primarily from AI-related stocks, it’s a question today how much support are we going to get from business investment and hiring, given this lingering pool of issues that create uncertainty. So I would start with that.   The last thing I’d say, just for everyone here, if you haven’t had a chance to see it yet, we, CFR, partnered with Morning Consult to do a quite in-depth poll looking at affordability issues in the United States, looking at trade issues in the United States. And to me personally, the biggest surprise was the lack of difference between the Democrat and Republicans answering the questions on how they felt about tariffs and affordability. I would recommend you take a look at the research note. There’s a lot of great data in it. But the fact that both parties, a plurality of respondents, saw tariffs as increasing their affordability challenges made me wonder if the administration might try to slow walk new tariffs to try to reduce that perception and help the Republican Party into the midterm. It remains to be seen, but I think that’s an important angle of this trade conversation, is that we do have an important midterm election getting closer by the day.  CHANG: Rebecca, we put the link in the chat for everyone to that work that you just cited.  PATTERSON: Great. Thank you.  FISHMAN: Thanks so much, Rebecca. Really appreciate those thoughts.   Chris, over to you.   MCGUIRE: Thanks, Eddie. And thanks, Brad and Rebecca.  So I wanted to pick up on the point that Eddie made at the top about how this is significant for economic statecraft design generally, which I very much agree to—agree with. Tariffs have been the go-to tool the administration for economic statecraft. They’ve been the easy button, and they have—you know, it’s a chainsaw that has a very significant impact on a lot of countries. But the impacts are also very broad, which makes them very coercive, but also inherently a little bit untargeted. I think it’s just important to realize that I don’t think this means that we’re just going back to an era of, you know, free trade or globalization. I think that the way that the administration sees those issues is not going to change. And they do have other tools at their disposal to effectuate their policy goals. And I very much agree with Eddie’s take at the top that I think it means that it’s likely that we will just see other tools used more so. In particular, I think export controls, also import controls that the administration hasn’t made great use of, but very much could, and sanctions could be used more liberally.   Many of these are authorized under IEEPA, but it’s—I think it’s interesting that the decision was very, very clear that licenses are still permitted under IEEPA. It is fees that are not. And the president was explicit about his frustration with this. But the decision was unambiguous that this is—these are still permitted under IEEPA, and actually export controls are separately permitted under a separate statute as well, the Export Control Reform Act. So these controls are more specific, but they do—just to—it’s important for people to keep in mind, they give the administration, like, really massive leverage that, yes, you know, many countries and industries are very dependent on the U.S. market, hence the importance and effectiveness of tariffs as a coercive tool. But there—but countries are also very dependent on U.S. technologies. And they’re also very dependent on the U.S. dollar. And that dependence does, you know, retain the ability to use these.  So I think that ultimately I could see this cutting three different ways. I could see the use of these tools, you know, in a kind of broad-based threats to kind of cut countries off from goods as just a kind of equivalently broad weapon. I could see specific threats being used to just influence countries on targeted things. And I could also see a pivot to, especially on the technology front, a move where there’s kind of a real structured regime where actually, you know, there’s a real give and take here, and that countries that are recipients of U.S. technology kind of do make promises on a lot of the economic statecraft fronts. And then that creates a more—kind of a permissive technology regime within a certain set of countries. I think that could be an interesting side effect here, and actually is in line with some of the things that OSTP Director Kratsios said in India just yesterday. So I think much to watch on that front. But I think we are kind of moving into a different era on the slate of these tools, and the secondary effects here will be really significant.   There’s one last thing I’d say on China. I think it will be interesting to see—you know, obviously there’s the—President Trump also announced that he’s going to China in the end of March. Those negotiations, I imagine, will persist throughout the year. But what this also means, the ruling, is that if negotiations were to break down we’re not going to see threats of 100 percent tariffs again. What we would see is something else. And when the Chinese rare earth controls went into place, obviously the administration threatened tariffs. But the other thing that they threatened was export controls on critical U.S. software. And that was purposefully very ambiguous and very broad, because critical U.S. software could be anything. And U.S. software is in everything. So I think that’s a little bit of a teaser for where we could go in a world where we’re starting to just pivot to other tools as coercive instruments of statecraft and diplomacy.  FISHMAN: Great. So I know we have a handful of questions that we’re happy to take. Does Lilly—do you—do you have who’s raising their hands?   OPERATOR: We will take the first raised hand from Farooq Kathwari.  Q: Can you hear me now? Yeah, OK. This Farooq Kathwari. I’m CEO of Ethan Allen.   My question relates to south of the border. You know, most of our manufacturing is in the United States. Twenty years back we decided to supplement it by establishing manufacturing in Mexico and Honduras, major manufacturing. And now, and in the last few years, we have higher tariffs in Mexico than even in East Asia. How does this, what is now being discussed, going to impact south of the border?  PATTESON: I mean, one—I’m sure my colleagues here have additional thoughts, but maybe I can just start off.  I think one issue to keep an eye out on with the USMCA negotiations—so that’s separate from IEEPA—is right now the USMCA talks about rule of origin, what country something comes from. I think going forward one possible change that we’re hearing more discussion around is the company it originates from. So, for example, you mentioned Mexico, or Latin America more generally. If something is coming from there but the—but the part, let’s say, coming into the U.S. or the good coming into the U.S. is overseen by a company that originates in China, for example, that might be something that gets more attention than it had in the past. So that is one possible change that could affect how people are thinking about producing south of the border from the United States, that they might be looking more not just at location but also the supply chain, and the specific companies, and where those companies originate.  So that is—that is one possible change I would keep an eye out on. But I’m not sure, Brad, Eddie, Chris, if you have other things you’d add to that.  SETSER: And I’ll toss in a couple of things because I think—I think Mexico and Canada are one of the biggest sources of uncertainty about the new 122 tariffs that in principle are coming in.  Mexico and Canada benefit from the USMCA exclusion, which exempted most—not all; certainly not autos, obviously for your company not all of your goods, I guess. But most of Mexican and Canadian imports were exempted from the reciprocal tariffs and the fentanyl tariffs, so the effective tariff on Mexico and Canada was well below 10 percent. I think it will be interesting to see if the administration maintains that exclusion or if it can maintain that exclusion under Section 122.  With respect to Mexico in particular, our bilateral trade deficit with Mexico is now quite big. I don’t think that’s a problem. Mexico’s global trade is balanced. It’s just a function of the way supply chains have developed. But it is the case that there’s a big bilateral deficit. And if the bilateral deficit is defined to be part of the balance of payments imbalance, it would be a little strange to exclude Mexico from the 122 tariffs. Now, there may be legal avenues that allow that to happen, but to me that is the most important uncertainty.  And then I think the next question becomes, well, does the 122 10 percent tariff go away after 150 days? During that 150 days, Mexico and Asia may be on pretty close to equal playing. But then for furniture, for example, would there be a furniture 232 that effectively replaces sectoral tariff, the interim balance of payments tariff? And under Section 232, the administration has complete discretion to adjust tariffs up or down inside that sector based on negotiations, deals, preferences, companies’ arguments. So I’d be watching very closely how the structure of tariffs with respect to Mexico evolves.  And to Rebecca’s point, this is conceivably laying—you know, it’s the first part of the USMCA renegotiation and how the administration wants to play it. These are—to me, those are some of the most important questions that come up. How are those countries that had the least tariffs—not zero tariffs, but the least tariffs—under the reciprocal IEEPA tariffs going to fare under this new regime?  FISHMAN: All right. Let’s go to the next question.  OPERATOR: We will take the next question from Tracy Moran (sp).  Q: Hello. Can you hear me? OK. Thank you.  Well, you’ve already talked a little bit about the Section 122 tariff. I guess my question was whether or not it’s ever been tested, whether the president could revoke its use after five months and then reimpose it even without Congress extending it.  SETSER: Incredibly good question. I don’t think so, but I’m not a lawyer. But some people are saying he could.  FISHMAN: Yeah. This is—we don’t have a precedent for it. But I’m personally skeptical that that would be viable, but it is an—it is an important question and something to keep an eye out for. Technically, you know, after the 150 days you can’t renew it unless, you know, Congress supports it. But at the same time, could he revoke it beforehand and then reissue it later? TBD.  OPERATOR: We will take the next question from Kelly Malone (sp).   Q: Hi. So you had mentioned that 122 you might not be able to exempt products—you’d have to exempt a whole country. I am still waiting for a lot of those USMCA questions from the White House today.  But it strikes me as interesting to think what would the impact be, say, on the United States having this 10 percent tariff. I think of the Midwest and Alberta’s oil. So if they’re unable to exempt products, do you think this will hold when you have potash, uranium, and oil all becoming 10 percent more expensive?   SETSER: I can see Congress trying to find some capacity to grant exclusions for precisely that reason. I think you’ve just highlighted the centrality of that question. You, clearly, can’t exclude countries if they’re not contributing to the balance of payments problem. Beyond that, I think we’re going to find out. Maybe Eddie is—he’s a real lawyer. He will know. *Correction: product categories may be exempted under Section 122 tariffs.   FISHMAN: Yeah. No, I don’t have much to say on that other than I do think that you’re hitting on something quite important where a true across-the-board tariff on a country like Canada is not viable from an economic standpoint in the United States.   I think if there’s one important lesson about American economic statecraft over the last year it’s that the U.S. has quite a low pain tolerance for even small dips in the stock market or, certainly, inflation and cost of living as we approach a midterm election.   So I would—I would imagine that a 10 percent tariff on oil coming in from Canada that is going to come into the U.S. anyway wouldn’t be a particularly politically popular thing in the United States.   OPERATOR: Take the next question from Shri Shrivasan (ph).   Q: Hi. I would like to just ask about what happens with places like India where they, you know, give all these concessions, and what’s going to happen with that? What do you think is going to happen with that?  And this new 10 percent on top of whatever is there, is that—I mean, with Trump we have to often wait to see what’ll happen, but do we have time for that? And I just saw that Pritzker sent an $8.6 billion invoice on behalf of those citizens of Illinois to Trump.   SETSER: Look, I actually think India is, relatively speaking, a winner, at least in the short run, because the—you know, first of all, there was the possibility this deal could break down and we go back to the 50 percent tariffs.   Second of all, the new tariff was still going to be 18 (percent) and 10 (percent) is lower than that. You know, you have to adjust for exemptions and exclusions, but in some sense the deal for India in the short run got better, and then I think it would be difficult, for example, to launch a new 301 investigation targeting India after India has just done this deal.   So the way I would think of it is that India negotiated the tariff down to 18 (percent) and they ended up getting a better deal at 10 (percent).   FISHMAN: OK. I think we only have about a minute or two. So Brad and Chris, I wanted to see if either of you have any parting thoughts before we break.   SETSER: I’ll just note that Bessent—Secretary Bessent said that he thought that the new tariff structure would replicate the revenue of the old tariff structure; there wouldn’t be a falloff in revenue.   There is at least a possibility that in the next hundred and fifty days we would get more revenue if you did a broad 10 percent across-the-board tariff, which is undoubtedly the revenue maximizing tariff. Any exemption or exclusion makes it more politically tenable, but you’re giving up some of the revenue.   And then I do think it is important to note that at the end of the hundred and fifty days it is extremely unlikely that we would end up with the exact same tariff structure that we had under IEEPA and the reciprocal tariffs. We may get the same amount of revenue, but it’s not going to be from the same set of products or the same set of—or from imports from the same set of countries.   So there is going to be an evolution, and as my colleague Rebecca said, that itself is a bit of a source of uncertainty.   MCGUIRE: Yeah, and I’d just say, especially on the China side, that just to note what most of the areas where we’d see the kind of most acute concern on Chinese products—things like EVs, things like legacy semiconductors, things like that—nothing changes on those fronts, right? Those are—those already have 301s. And I think that you’re probably going to see those expand out to a variety of products. Maybe on things like kitchen cabinets and stuff, it’s going to be—your 232s there are going to be a little more—a little more complicated. But I think on the China front they’re going to find a bunch of ways to kind of capture a large number of products and kind of modulate the tariff type. But I do think that the kind of longer-term trend here on economic statecraft tools is really one thing to look at.  FISHMAN: I think the final point I’ll make, and then we can break, is if you listen to Trump’s remarks that he gave during the press conference earlier today, it was quite clear that he was kind of incredulous by the fact that the International Emergency Economic Powers Act does authorize him to completely cut off trade with a foreign country, but it doesn’t authorize him to charge a 10 percent tariff. In some ways, Trump—that makes sense, from a logical standpoint. But what—the important take home, I think, is that IEEPA does provide the president with quite sweeping authority on financial sanctions, on export controls, on import controls, as Chris mentioned. And so I don’t think by any means this is the end of Trump’s weaponization of economic power for foreign policy and economic gain, but it does mean that there will be a pivot, I believe, from one tool to others.  OPERATOR: Thank you all for attending today’s media briefing. If you have any additional questions for our panelists or any other experts at CFR, please reach out to [email protected]. And, as a reminder, this event was on the record, and a recording and transcript will be posted on our website momentarily. Thank you, again.  (END)  This is an uncorrected transcript. 

We invite you to a special screening of the documentary Atomic Echoes: Untold Stories From World War II, followed by a panel discussion on the lasting human, political, and global consequences of the atomic bombings on Hiroshima and Nagasaki. The film follows two friends connected by family histories on opposite sides of World War II as they explore the lasting trauma of the bombings. Through the stories of Japanese hibakusha (survivors of the atomic bombings) who endure lifelong health complications and psychological scars, alongside American atomic veterans who witnessed the aftermath and continue to struggle with radiation-related illnesses and PTSD, Atomic Echoes offers an examination of memory, responsibility, and the lasting impact of nuclear warfare. This program is made possible through the Daniel B. Poneman Meetings Program on Nuclear Energy, Climate, and National Security. Members may bring a guest to this event. Please note there is no virtual component to this meeting.

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Panelists discuss the new Council Special Report, America Revived: A Grand Strategy of Resolute Global Leadership, which defines U.S. vital national interests, summarizes the history of American grand strategy, outlines and critiques five grand strategy schools, and advances a new grand strategy—resolute global leadership—which combines military strength with international legitimacy. To mark the 250th anniversary of the U.S. declaration of independence, CFR is dedicating a year-long series of articles, videos, podcasts, events, and special projects that will reflect on two and a half centuries of U.S. foreign policy. Featuring bipartisan voices and expert contributors, the series explores the evolution of America’s role in the world and the strategic challenges that lie ahead. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

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The Council on Foreign Relations invites you to a special offsite event in partnership with the 9/11 Memorial & Museum.  Twenty-five years after the September 11, 2001 attacks, the aftershocks of that day continue to shape U.S. foreign policy, domestic security, and global affairs. Panelists examine the lasting implications of 9/11 and the national security challenges facing the United States today. Drawing on their extensive experience in government and policy, the speakers offer a historical perspective as we approach the twenty-fifth anniversary of the attacks. The program will be preceded by a private tour of the Museum exclusively for CFR members. 

Foreign Minister Gerapetritis discusses Greece’s approach to evolving U.S. foreign policy, NATO’s role in ensuring stability in the region, and Greece’s broader engagement across the Eastern Mediterranean and the Middle East.

Panelists discuss the state of the U.S. economy and consumer sentiment, the impact of innovation in advanced technologies on markets, and the global economic effects of geopolitical uncertainty.   PATTERSON: Thank you very much. And thank you everyone for joining us today. I’m absolutely thrilled to have three amazing economists here joining me to discuss the outlook for the year ahead: Fabien Curto Millet, the chief economist at Google; Phil Mackintosh, chief economist and a senior vice president at Nasdaq; and certainly last but not least, Michelle Meyer, the chief economist at Mastercard Economics Institute. So, as you just heard, we’re going to spend the first thirty minutes, the four of us, having a conversation about the outlook. I should mention I’m Rebecca Patterson. I’m a senior fellow here at the Council on Foreign Relations. And I’ve spent the bulk of my now nearly thirty-year career studying the intersection of financial markets, economics, policy, and geopolitics. We’re going to talk for about a half hour, and then we’re going to open it up for your questions. And, as you heard, you can submit those verbally or in the chat by writing. And we’ll try to take as many of those as we can. Whatever is on your mind. And just finally, as a reminder, we are on the record today. So let’s jump right into it. I personally have found it interesting that just in the last several weeks we’ve seen, as expectations for the U.S. economy—and I’m going to be a little U.S.-centric here, because the U.S., for now, at least, is still the biggest economy in the world and has a dominant role driving the global economy. So with the U.S., we’ve seen economists’ expectations continue to tick higher. In December, the Bloomberg consensus was about 2 percent GDP growth for this year. Now it’s up to 2.3 percent GDP growth this year. I’m curious, from each of you—we’re just going to start at a high level here and then we’ll get into the weeds. But, at a high level, do you expect 2026 to be basically a repeat of 2025? Where we have resilient growth, maybe some decoupling with that growth with the labor market, a big AI and consumer factor driving it? Or is something different, in your mind, this year? And if there is something different, love to hear what it is. Michelle, let’s start with you. Again, let’s start high level and then we’ll drill down. MEYER: Sure. Of course. Thank you, Rebecca. And it’s a pleasure to be here and to spend some time talking to you all. It’s interesting in how you kicked off the conversation around the upper revisions, because they have been quite stark when you think about how forecasts have shifted so rapidly. And I think the big reason for that forecast change was actually what we experienced at the end of 2025. It was the handoff from a strong end of ’25 more so driving the forecast change in 2026 than it was around a considerable change in expectations for what will evolve in 2026. And a lot of that came from, frankly, what we witnessed firsthand at the institute is very strong consumer spending at the end of the year. It was a robust holiday shopping season. It was a persistent holiday shopping season. And it started early, but still managed to end on a powerful note. And I think that speaks to the fact that the consumer has continued to be engaged. You have the headlines that are scary. You have a lot of risks. But consumers have maintained their purchasing power. And they have, if anything, gained more choice and more flexibility in a world where technology is moving so quickly, particularly when it comes to AI. So I think that was a critical factor in terms of revising up 2026 forecast is simply what we learned at the end of ’25, which was in this economy that was continuing to move forward, and continuing to see that powerful spend. When you think about some of the drivers and the potential similarities of ’25 I think, you know, 2025—and Fabien will talk much more about this—but 2025 was certainly a year where we had a lot of dollars poured into the economy to invest in AI, to invest in the digitalization, to invest in technology. I think 2026 can perhaps be more a story of how we adapt, how we absorb that, how we try to actually take that technology, take those investments, and put it into the economy. And there’ll be a lot of learnings along the way in terms of how businesses embrace that, how consumers embrace that, and how the labor market evolves. And then I think in terms of the headlines in geopolitics, there was—I mean, when we were sitting here this time last year we were facing what felt like an impossible situation from forecasters. I think today we have learned more. We have learned how uncertainty shocks impact or don’t impact parts of the economy. So while uncertainty will remain high, while these headlines are not going away, I think that we’ve kind of found a new—a little bit of a new baseline in terms of how to evolve in a world where they is still going to be heightened uncertainty. PATTERSON: Fabien, Michelle mentioned AI and tech. And I think that’s probably a perfect segue to you, my friend. And I’m going to come back to you on AI specifically because it is the elephant in the room. But first, just high-level overview of the U.S. economy. What’s your perspective as we’re looking at the year ahead? CURTO MILLET: So you both rightly called out, Rebecca and Michelle, the upward revisions in sort of the forecast out there. It’s also nice to sort of open the bonnet and sort of look at the distribution underneath. And you’ve got some notable forecasters who are way ahead of consensus. So Goldman is at 2.9 percent at the moment for the year. And some people go higher. I think I saw Nomura at 3.1 (percent). So definitely you’ve seen that trend, and people are quite bullish. From where I stand, definitely sort of technology is going to remain a tailwind for us. So, you know, to take the big picture, we are living through the most exciting technological shift that I certainly have observed in my professional career as an economist. So AI is a sort of multiyear endeavor as a transformation. You look at serious scenarios, from the OECD to Goldman Sachs, and essentially the potential there is 10 percent uplift in U.S. GDP over a period of ten years-plus. The potential is not a guarantee, of course. If we sit on our hands it does not translate. But it just shows how tantalizing, you know, the price is. And in terms of immediately for next year how will this manifest, so there’s the AI CAPEX story that we can come back to that was a big feature of 2025. And there’s also what Michelle called out, which is more and more green shoots of productivity uplifts as the technology gets successfully implemented through the economy. So I’d be very excited in tracking all of that. Other things that I’ll be sort of watching closely. Consumer spending. So Michelle has called that out as being robust. Curious to see where that goes next year because, of course, about 68 percent of GDP right there is consumer spending. You know, we’ve had a lot of talk about a K-shaped economy. How will the distribution of spending evolve? And, of course, behind all of this, you still have stock market wealth and you have tech. So many, many roads lead to tech. And finally, Rebecca, you called out the labor market, where we had that low hire, low fire feature. Bit more of a melancholy note in the economy these last few years. Curious how that evolves as well. PATTERSON: Thank you. And, Phil, I feel like what Michelle and Fabien just said, where they intersect is your world. You know, at the Nasdaq you’re looking at the whole economy, of course, but obviously you have a great seat, a perch if you will, to understand how the equity market, how banking, IPOs, M&A, how all that feeds into this. And, again, we’re going to go a little more in the weeds in a minute, but let’s start first with what is your overview when you look at 2026? And anything you disagree with, with Fabien or Michelle, or you’d want to highlight? MACKINTOSH: I mean, it’s kind of interesting. It feels like this year all the economists are actually coalescing around consensus. No one’s calling for recession. And no one’s really calling for an inflation spike that’s going to require rates to go back up dramatically either. So largely I agree with guys on the call. What’s interesting is I think we will get slow but positive growth. Which is just like last year. But I think the reasons why are different. So in the past couple of years the real surprise has been that consumer. As Michelle said, they just kept spending and they kept spending much more than the inflation was actually accounting for. And part of that was because they had real wages growth. Now that we started to see the jobs situation kind of more normal, with one job for every one person looking, wages are slowing, companies are mentioning that to me and that’s sort of helping them manage their profit and loss and their margins. But I think that’s going to, to Fabien’s point, play out in the K-shaped economy, where you’ve got wealthy people with an income effect and sort of—you know, their houses are worth more, their shares are worth more. Low-income people are starting to see their wages growing more slowly. So I think that’s kind of turning into a bit of a headwind for the economy. But then the tailwind, I think AI has been a massive tailwind for the stock market for the last couple of years. I think in the last six months we’ve started to see it’s actually a tailwind for the economy as well. And when you look at the GDP growth last year, it was half consumer, half AI spend. And that’s basically it. So I think we’re starting to see AI spend coming through into the economy as a tailwind. And the other tailwind that I see is the Big Beautiful Bill. We’re going to get tax cuts. I mean, it’s an investment stimulus for companies as well. So kind of mixture, like, of headwinds and tailwinds, which I guess at the end gives us a positive result, but not necessarily a superheated economy. PATTERSON: Well, thank you for that. And while I get the narrative and it resonates, at the same time—and I’m sure we all would agree with this—it always makes you a little bit anxious when everyone agrees. When the consensus gets so far on one side of the boat it’s worth peering over the other side of the boat just to make sure there’s not a large shark or something equivalent there. Let’s go into each of these pieces because I think all of these are going to be so critical for the economy this year—the technology, the consumer, and, frankly, the financial markets, and how they’re all intersecting with each other. And, Fabien, I want to start with you and keep digging in a little bit on tech. So I think around the end of last year we’ve started in the financial market seeing a little bit more dispersion, people taking a bit of profit off some of the tech companies, and maybe because of this bullish consensus moving into other types of companies, stocks, looking for that cyclical tailwind to help, I think, at the margin. But there’s also some anxiety. Will we see that productivity boom? Will we see revenue generation from Ai quickly enough to help mitigate some of the fears about financing? So I’d love for you to share your perspective on, you know, the timing of the AI productivity. I know it’s an impossible question. And also maybe if you could a little bit the labor markets. I mean, the estimates for how much and how quickly this will affect the labor market are as diverse as the productivity hopes. So how do you see it playing out? CURTO MILLET: Thank you, Rebecca. Lots of questions there. PATTERSON: I know. I know. CURTO MILLET: Gosh. Let me try to unpack impact them as concisely as I can. So, as I mentioned, the AI transformation is a multiyear narrative arc. So it’s a powerful rewiring of the economy. So we’re in this for a while. But let’s sort of focus on the short term, AI CAPEX. So 2025—and Phil alluded to this already—so we had estimates that—you know, from Barclays—that half of GDP growth for the first half of a year was essentially AI CAPEX related. The Federal Reserve Bank of St. Louis looked at the first three quarters, I think this was just published this month, and found 40 percent was AI CAPEX related and adjacent. So in essence, very, very material estimates differ depending on how you adjust for imports, but we’re at that level of materiality. And looking forward this year, I saw Bridgewater Associates again forecasting that AI CAPEX will be half of GDP growth. So it’s a big deal. That’s in terms of just the investment. But then you’ve got how it’s flourishing across the economy. And we get to your question about productivity. So productivity takes time to unlock, because you need to move from point solutions to system solutions. We know that AI is transformative. If you look at the rigorous microeconomic studies in the literature you’ve got uplift on average of 24 percent in terms of productivity. And if you survey anecdotes of firms that are implementing—so, Goldman came to an average of 32 percent. So when it works, it works really well. But then adoption does take time, as I said. The Census Bureau, in terms of its latest reads, estimates that 17.7 percent of firms in the U.S. have adopted AI. So there’s a long way to go. And the other thing to bear in mind is that it’s very uneven adoption. So my CEO Sundar Pichai, said last year that we’re going to get AJI, artificial jagged intelligence, before we get AGI, artificial general intelligence. And, yes, if you look again at Census figures, the information sector is at 35 percent adoption. Construction is at 10 percent adoption. So you’ve got that unevenness across the economy. It’s going to be very interesting to see how it plays out. But then, turning to the labor market—which was also in your question—what is happening there? So in essence, lots of debates as to how jobs are going to be impacted. The right framework, generally speaking, here is jobs gained, jobs lost, jobs changed, you need to think about all three categories. And the lessons from history are broadly reassuring. I mean, technology is routinely a net creator of jobs. My excellent colleague James Manyika, when he was at the McKinsey Global Institute, he looked at—in detail at the personal computing transformation and found that it destroyed three and a half million jobs—typewriter manufacturing, you know, clerical jobs—but it created over nineteen million jobs in tasks like computer manufacturing, obviously, but also analyst positions. So you’ve got that sort of dynamic going. So the equilibrium to equilibrium effect is good. The transition is where you need to pay a lot of attention to make sure that people have the right skills to catch the upside. And so there’s a big, big discussion there. But so far not a lot of evidence of AI impacting jobs. Whether in the labor market as a whole—there’s a great Yale budget lab study from October last year that looked at that writ large—or even in pockets. People worry a lot about early career workers. My great colleague, Zanna Iscenko, and I put out a paper—self-advertorial here—a couple of weeks ago, via the Economic Innovation Group, where we looked at the early career worker story in particular, and found that that was basically macro driven as opposed to AI driven. So that’s the story to date, to catch us up. In the future, what will happen? Well, you know, reassurance in the past does not preclude vigilance in the future. So we need to be careful here. But in essence, I expect upside from new creation of work. And the faster it comes, the better. I’ll end with one stat. David Autor, the voice of the American worker, MIT professor, and actually a technology and society fellow at Google now. So he’s—one of the best stats in his work is that 60 percent of employment in the U.S. economy today is in roles that did not exist eighty years ago. So that’s how the economy changes. And that’s the dynamism that we need to favor so that things are OK. So I hope I answered all of the various things in your question, Rebecca. Happy to deep dive further later. PATTERSON: Thank you. No, that was perfect. Thank you, Fabien. And, Michelle, so we’re looking at a glass half-full from Fabien, although acknowledging that there’s still uncertainty out there. I want to take a glass half-empty for a minute. If we see AI hit a constraint this year—it could be energy supply, it could be access to needed materials other than energy, it could be a DeepSeek moment, a Chinese LLM that surprises people and just hurts the stock market, and so you see that wealth effect hurting the consumer. If you don’t have that tech-led push can the consumer hold up? Can we continue to see that 68 percent of the economy holding up so much of the growth, if we don’t have that tech piece of the puzzle? MEYER: Well, I think you have to consider the transmission from tech, from AI, into the consumer. So, yes, one of the paths is through the wealth effect, through the stock market. So the extent to which there is a turn in terms of the AI-driven wealth gains and stock market-led rally, there will be a shock to confidence. Consumers will see some of their wealth be reduced. Obviously the wealth effect, as we all know, happens with longer lags. It’s not immediate. But just from a perception, you could start to see consumers become a little bit more cautious, perhaps, if it proves to be persistent and they believe that it’s going to be, again, a more significant and lasting issue. So, yes, that’s something to watch. We always think about these linkages, in terms of what the market’s saying versus what the economy is saying, and how they will reinforce one another. But in terms of the technology, as Fabien mentioned, it is transformational. And it’s not going to go away overnight. And, if anything, it is clearly going to continue to move forward. And consumers are feeling that. They’re feeling that in terms of their ability to access information more quickly. They’re feeling an ability to shop more quickly, something that we spend a lot of time thinking about in terms of agentic commerce. They’re seeing it in the sense of, you know, having just in general more choice, more information. And all of that tends to be somewhat disinflationary, which is helpful for the stability of the economy and the path forward for technology. So I think consumers in general are, at the moment, benefiting from the implementation, adoption of AI. And I think it’s happening at an increasing rate across the globe. So, yes, obviously you have to pay attention to the rhetoric around it. You have to pay attention to markets in general, as you would with any type of market move that can matter for consumers. But I don’t know that the market moves will necessarily stop the transformation that’s happening from AI. The stats—I just jotted down a bunch them from Fabien—they’re meaningful. They’re amazing. And they’re long term. PATTERSON: Yeah. I mean, I am a party of one here so I’m not a good sample, but it I use LLMs every single day as a research tool. And they save me hours and hours a day. This last weekend in the snowstorm here in New York City I decided to install Claude Code and created my first website ever in my life in about ten minutes, which—it’s not very good, but the fact that I could even do it is kind of extraordinary. And I just keep wondering, as more and more people with all the different companies products start adopting them, how our lives are going to change. It reminds me of my first PalmPilot. Phil, I want to turn to you. And, you know, just as we have a pretty bullish consensus on the U.S. economy this year, there’s also a bullish consensus on the equity market. And we know they’re not the same thing, but they definitely influence each other. You know, if people are hopeful on growth they might buy more small cap stocks, for example. Or if people are bullish on equities, companies see their equity price go up, they might have more confidence to hire more people or invest more. So I would love to get your thought on, you know, the pushes and pulls on the markets this year, in terms of how you think about them with your economic forecasts, how you net them out. You know, on one hand we see a pretty radically, surprising interventionist, Republican president, who is going into different companies, threatening things, buying shares, changing how much buybacks a company could do. We haven’t—I don’t think anyone had that on their bingo card. At the same time, we also have a backdrop that’s, you know, deregulation, opening up that window for M&A and IPOs. Again, how do you net all those influences? And how does it affect your economic view? MACKINTOSH: Yeah. I mean, to be fair, the last three years has been all about the Nasdaq 100 index, and just U.S. large cap companies generally. They’ve completely thrashed every other kind of equity market. But in the last six months that is starting to change. And I think Fabien might have mentioned that, like, the valuations of those mag seven companies have started to sort of stall a little bit at the levels—not falling, but stalling at the levels they got to. And you’re starting to see a broadening out. Last year, Europe and Asian equities actually did even better than the Nasdaq 100, which I think a lot of people missed. So we’re starting to see a broadening of earnings growth and a broadening of performance across equities completely, which I think just speaks to an investor appetite for stocks kind of coming back as well. We’ve seen that in another area, which is in the IPO market. So we kind of struggled out of COVID in the IPO market. Last year was actually the second-best year for what I call the IPO pop. So that day-one return of the companies that come to public markets was better than it had been in any time since 2014 at least, except for that COVID year. So I think of that as sort of an investor appetite metric that’s really interesting. And obviously in 2026 there’s a lot of press about some really big private companies that might IPO, some centicorns, as people talked about. In terms of M&A, we’ve seen a little bit of an uptick in M&A. Partly that’s because of the pro-merger policies, I think, of the administration. Partly it’s lower rates. But actually it’s a lot of AI deals and it’s actually quite a lot of private equity buyouts. So it hasn’t been your typical M&A cycle across the whole economy yet. But that’s sort of helping—it always ends up helping when the M&A cycle picks up as well. The third part of your question, like, the policy shifts and all of the sort of, I guess, spanners that got thrown in the works last year, I think what’s interesting there, from my job talking to issuers and the companies that are listed on Nasdaq, really the most disruptive thing this year was tariffs. A lot of companies saw the news in April and the market sell off in April, and kind of panicked that maybe they wouldn’t be able to run their businesses anymore with tariffs as big as, you know, 15, 20, 25 percent. As the deals started to come through and as people really started to analyze their supply chains, though, we saw in the economic data tariffs didn’t matter anywhere near as much as people worried about. The stock markets recovered. And when I go and talk to customers, a lot of the time customers have realized, you know what? The only thing that gets tariffed is imported goods. So if I’m services company, I don’t really care at all. If I’m a mostly domestic producer of goods, it’s actually probably a good thing because it helps me against somebody who’s an importer. And so it’s not universal that everybody actually has been badly impacted by tariffs at all. And when I talk to companies, a lot of them say they’re looking at supply chains and trying to work out where to resource goods more cheaply, but when you look at the import data it’s really not changing that much at all. So it doesn’t look like companies have massively restructured their supply chains. There’s no countries—maybe Germany and Canada, which have kind of expensive labor on the fringe—that have started to see their exports fall to America. But really, all of those tariffs have been much more easy to digest than people thought. The one thing that does seem to come up when I’m talking to particularly smaller companies is tariffs have introduced a lot of complexity and a lot of uncertainty. And so a lot of them are kind of struggling to work out, like, how to plan through what’s happening now, what might happen in the next six months. And if you look at the jobs data, and you break it down by company size, pretty much as soon as the tariffs in April were announced you saw small companies net losing employees, even though the larger companies were net still hiring. So there may be a little bit of a dislocation where smaller companies have been particularly affected by things like tariffs, but actually the larger economy is much less affected than I think we all thought we would be go, back in April. PATTERSON: Yeah, I’ve seen similar data on the smaller companies. And, you know, they’re both—they overall—I’m generalizing, but they’re more exposed to tariffs than large companies. They also generally are more exposed to foreign-born labor. So they’ve gotten hit a couple ways. And have fewer resources to manage the complexity, which you mentioned. So that will definitely be an interesting one to watch this year when we have the Supreme Court decision on the reciprocal IEEPA tariffs. How hard is it to get refunds? What replaces them? So tariffs might not have been as bad as feared, but I don’t think the tariff uncertainty and question marks are gone yet. But we’ll cross our fingers that this year is an upside surprise on them, as it was last year. I want to switch gears now. We have a Federal Reserve meeting kicking off today. An announcement coming tomorrow. I think the broad consensus is that we’re not going to see any change in policy interest rates tomorrow. I think the Fed signaled that pretty clearly. But we still will have comments and a statement to parse. And I think there is a lot of attention on the Fed right now, if not for this meeting to both what will they do this year overall. Will we get—right now it’s not quite two twenty-five basis point cuts priced in, but almost two twenty-five basis point cuts priced in. Do we get the two cuts? Do they worry more about labor or inflation? Inflation is still quite a bit higher than they’d like. And then, I guess the second question—so you guys can pick and choose what you want to answer here—is Fed independence. We have a lot of possible risks around that this year. And how worried are you, or not, and why? So I’m going to play jump-ball on this. Actually, you know what? Fabien, I’m going to start with you, because I keep starting with Michelle. So let’s start with you on this one, and then we’ll go to Phil, and then Michelle on the Fed. CURTO MILLET: Super. So I don’t, as a rule, commentate on Fed policy. But they will zoom in on a sort of narrow aspect that’s interesting and to watch. Last year we had Austan Goolsbee of the Chicago Fed give a speech near here, at Stanford, where he remarked on something. He called it “weird and lovely” when it comes to productivity growth. Which is that when you look at productivity growth in the last couple of years, we are above the pre-COVID trend. And so, you see I’m going to bring this back to AI. Because the question, is this AI related? And so he looked at the productivity surge, industry by industry, and found that seven out of the top eight, you know, industries was at such a surge so were either AI or tech intensive. So seven to eight out of ten. And this is confirmed now. There was a paper by the Federal Reserve Bank of St. Louis in back in November, where they saw that industries with higher AI adoption are also showing higher productivity growth. Why am I mentioning this? Because if this is confirmed and enshrined, as I think it will be, it’s wonderful news for the economy and for the Fed. Because a central banker’s dream is growth without inflation. And so this is changing the engine of the economy, not pumping the gas to get more speed. And so let’s see this trend closely, but, you know, definitely the Fed is hoping that some of these supply constraints don’t bite as hard as they have in the past thanks to technology. PATTERSON: And I think that’s a great thing to watch for after tomorrow’s meeting, if we get any commentary on that. Yeah, Phil, anything you want to add on this? MACKINTOSH: I think if I was a Fed governor and I got to vote, I would be voting for at least two more cuts. And there’s probably three reasons why. One is, the small companies, again, have very high interest costs right now. If you look historically, going back two, three decades, they’re close to 50 percent of their EBIT is being paid in interest expense. It’s just starting to come down. But basically, a lot of small companies’ margins and profitability has been really hurt by these higher interest rates. So I think lower interest rates can be good for small companies, which is going to be good for employment. I think demographics is something that people don’t talk enough about. We are barely growing our population now. So compared to the ’70s, when we had three-odd kids per family and a lot of household formation and extensions and extra houses and, you know, people buying more white goods, there’s just not going to be that kind of demand going forward with an aging population. So look back at Japan in the ’90s. And I don’t want to say we’re exactly that, but that’s kind of the demographics that everybody in the developed world is in right now. So that’s not going to keep the economy hot on its own. And I think in terms of the inflation, I talked a little bit about how wages pressures have come down, which is good for companies. But I just don’t see an upside risk to inflation. And maybe even Fabien’s point is, you know, if we can have productivity we’re not going to have inflationary pressures, even if we have reasonably hot GDP growth. So personally I think there’s a good reason to get rates quite a lot lower. I would probably say three would be my vote, if I was a Fed governor. PATTERSON: All right. That’s great. I appreciate the thoughts on that. And, Michelle, anything you want to add briefly? I want to try to get two more quick questions in before we go to Q&A, but if you have a thought on the Fed we’d love to hear it. MEYER: I mean, I think it all is around where you assume that steady state equilibrium is. And if it is the case that we have productivity, we have low potential growth, we have disinflationary structural forces, then lowering interest rates can be quite credible and makes sense. So that’s what I’ll be listening to Fed Chair Powell tomorrow, is trying to get a better sense of where they think that star is, where they think they’re shooting towards, and how they’ll be able to determine whether or not they feel like they found it and have that optimal level of interest rates. Because they’re not cutting necessarily to provide easier monetary policy. They’re cutting to get to that optimal rate. PATTERSON: OK. Great. While we’re still on the Fed, I know one thing this administration has talked quite a lot about is having some sort of new Fed-Treasury accord. Secretary Bessent from the Treasury Department wants to see some reform of the Fed. And we know that Chairman Powell is going to step down as chair. We don’t know if he’ll leave the Fed completely in May. And we might get a new nominee to succeed him as early as this week. President Trump has suggested it’s coming shortly. I’m curious. You know, all of you are talking to a lot of corporations around the United States and even overseas. Borrowing costs. You know, Bessent’s North Star, if you will, is getting that ten-year yield lower. And we know that that’s a critically important yield for the housing market, because it anchors mortgage rates, for corporate borrowing, and certainly, as we try to finance our large and growing budget deficits here in the U.S. What are you hearing from your clients on borrowing costs? And how do you see that flowing through to the economy, or not? Am I making a mountain out of a molehill? Anyone who’d like to jump on that. MACKINTOSH: Let me start, because I get a lot of questions from corporates because they don’t understand how the federal government can be so blasé, I guess you’d say, about the level of deficit they’re running. And I think that’s because corporates have to borrow money. And they realize that their leverage is really important and they can’t just increase taxes to cover it. But the corporates have been kind of wrong for a long time, right? I mean, you look at a lot of economies around the world—Japan stands out, but even some of the European economies—you can keep borrowing as long as you can control your interest rates and you can grow your GDP. So as a country, like, being able to afford debt and deficits is different than for companies. PATTERSON: Anyone else want to jump on that? Otherwise real quickly I’d love to turn to the global economy. So we’ve—again, we’ve been quite U.S.-centric, I think for good reason, so far today. But I don’t want to ignore the rest of the world. Again, the global GDP picture is looking decent this year as well. We’re expecting some stimulus from China. We are seeing more infrastructure and defense spending coming out of Europe. Most of the other emerging markets are looking decent, in some cases because of AI exports. Any concerns you have? Or do you think it’s pretty smooth sailing when we look at the rest of the world in 2026? MEYER: Well, I can jump in. I mean, I think it’d be nice to say it’s all smooth sailing, but obviously we have to stay really vigilant here as we think about all these different dynamics. So, yes, I think the baseline is, as we talked about, somewhat comparable to last year in that we will continue to see expansion, we will continue to see resilience. And that’s what we’ve seen for the past few years. But, obviously, we have to be on watch. I think you alluded to one that’s important, which is fiscal tailwinds. You are seeing that certainly when you think about China and supporting the domestic economy, being really mindful about bringing a new type of consumption, a new type of domestic growth. Germany expanding its fiscal spending, what that means for the longer term, but certainly even what it means for this year. And then around technology and the race to adapt and invest in technology, it’s not happening at an even pace, as I’m sure Fabien will talk about more. And that’s going to also see some real differentials across the globe. Trade will be another one. How do we consider—you know, we’re just getting started—we just got started last year in terms of the trade realignment. That will continue into this year, and it will continue thereafter. So how does that show up in terms of relative growth, where some of the acceleration or deceleration might be based off of how supply chains move? PATTERSON: Fabien, from a technology perspective, from your seat are there any countries you’re trying to keep a closer eye on than others in terms of technology outside the United States? CURTO MILLET: I mean, obviously all eyes outside the United States are on China, with the sort of AI race that’s, you know, in full swing. Demis Hassabis , our excellent CEO of Google DeepMind—so recently, I think it was with CNBC, it was a podcast, where he said that China is actually closer to the U.S. frontier than is generally anticipated, maybe just a few months behind. But being closer to the frontier you have to take that with a pinch of salt, because imitation is easier than, you know, pushing the frontier forward. And that we have not yet seen evidence from China of that ability to push the frontier forward. Nevertheless, closer on the heels than many anticipated. So, you know, DeepSeek, everybody paid attention to that. But if you zoom out from tech, I mean, China is a powerhouse, right? You look at—the World Intellectual Property Organization has this great index of a global innovation index, which looks at innovation in the round. So not just outputs, patents, et cetera, but also inputs into the innovation process. China was forty-third in 2010. It’s now overtaken Germany, and it’s now in position ten. And just for context, the U.S. is in position three. So, I mean, they’ve got a rocket booster there. So definitely U.S. policy will need to keep, you know, China, because the rearview mirror shows them as large and growing. PATTERSON: Thank you. I’m going to pause us here and ask my CFR colleague to just remind our viewers, listeners how to ask questions, and see if we have any questions in the queue at this point. Otherwise, I have lots more on my mind. OPERATOR: (Gives queuing instructions.) We will take the first question from Peter Trooboff. PATTERSON: Hi, Peter. I think your mute might be on. OPERATOR: Mr. Trooboff, please accept the unmute now prompt. Looks like we’re having technical difficulty with that line. We’ll take the next question as a written question: How do you see the GENIUS Act affecting the payment space? What is your outlook for growth and innovation in crypto and stablecoin, while still protecting the U.S. financial system? PATTERSON: Michelle, would you like to kick us off on that one? MEYER: Sure. So it’s obviously something that, at Mastercard, we spend a lot of time thinking about in terms of the digitalization of the payment space. And I think the general view is the more that we can digitize it, the better we will be as a global economy. The more that we can enhance and support financial inclusion, the better we will be. So, you know, I think across the board there’s a lot of innovation happening in this space. There’s a lot of thought and work being done in terms of how to expand access to credit, how to expand access to overall payments, particularly digital payments. And, ultimately, that leads to more growth, greater growth, broader growth. So in general, it’s a net positive in terms of supporting more liquidity and growth in the economy. PATTERSON: Maybe I can take a little bit of the glass half-empty side, just for completeness’ sake if nothing else. But when I think about the GENIUS Act, and I think about what we’ve gotten and where we’re going, maybe two quick comments. One is that while I think having any regulatory guardrails is incredibly helpful, protecting consumers, letting people just know what the rules of the road are—so that’s good news—you know, there are still some questions around the degree of regulatory safeguards. Do we have enough in place at this point? And I think you’ll hear different people with different views on that. I think another interesting angle of this gets back to those borrowing costs and managing deficits. And, you know, the greater the adoption we see of a specific type of crypto, called stablecoin, which just mimics, in the United States’ case, the basic one is the dollar of stablecoins, who are mimicking the value of the dollar. And doing that largely by having risk free short-term government assets, T-bills, et cetera. And their hope is that by getting more adoption of stablecoin you’ll have more demand for these short-term treasury instruments. And that can help, all else equal, in terms of financing the deficit and keeping borrowing costs low. Of course, these are all short-end instruments, but they’re seen as part of a solution. Also protecting dollar dominance globally if you can have a dollar stablecoin out there in the world. And there are places that would rather have dollars than their own local currency, or have it for other reasons, that could also increase adoption. Which, again, would help on the budget side. One last thing I’m watching is, do some of these companies that are offering some of these digital assets—do they get access to the Fed window? How are they categorized by regulators? Do they have to play by the same rules as the banks, or slightly different rules? And if they get into trouble, do they get bailed out by the Fed? And I think that’s something to watch because as these assets get bigger and bigger and more integrated with the traditional banking system, there’s a greater risk of actual contagion. When FTX, Sam Bankman-Fried, happened a few years ago there was almost no contagion because it was still pretty siloed. And I think that’s quickly changing. So the contagion channel becomes something more important to watch as these things become more mainstream and more developed. I don’t know, Phil or Fabien, if either of you had thoughts you wanted to share on this. Otherwise, we can go to the next question. OK. CURTO MILLET: Nothing to add. I think you guys have covered it super well. PATTERSON: OK. CFR folks, do we have another question at this time? OPERATOR: We will take the next question as a written question from Frank Brown at General Atlantic, who asks: How do you see potential rebuild of Ukraine and Gaza impacting the global economy in the near to midterm? PATTERSON: Well, I’m happy to take a lead on that. You know, we have no idea on timing. And we have no idea what the settlement—I’d love to say peace, but I think that’s optimistic—what the settlement could look like. And what it looks like I think will give us a lot of insight into what the rebuild looks like, right? Is Russia allowed back into the global financial system? Are sanctions lifted? How much energy are they allowed to export over what time frame, for example? Is this going to be U.S. driven? How much will Europe have a role? So there’s, to me, more questions than answers in terms of the reconstruction of Ukraine, both the timing, who does it, and what are the conditions under which it happens, where the money comes from. That said, we know there’s going to be a huge amount of reconstruction ahead. And, all else equal, it makes me continue to be modestly bullish on the upside in terms of infrastructure spend, fiscal spend out of Europe. Now, the question and the challenge with that, of course, is what fiscal space? You know, Germany has quite a bit of fiscal space right now, but we’ve seen the—you know, the baby Liz Truss fiscal crisis moments out of France over the last year or so. We saw them a little bit last week in Japan. Of course, it all kicked off in 2022 in the U.K. So for the countries with less fiscal space, if there is a Europe push to reconstruct, where is the money coming from? How is it financed? How is it absorbed by financial markets? So I’m optimistic that it’s going to be a big stimulus for Europe but depending on how it’s financed I think we have to be a little careful how easily the bond markets absorb it. I don’t know if any of my colleagues here on the webinar have anything to add. I know you all probably are not focusing on Ukraine reconstruction as much as some other economists out there, but in case you have been talking to companies that might be involved. MACKINTOSH: I mean, my view on all this—I mean, there’s so many risks out there that we haven’t talked about, it kind of goes completely against how we started talking this afternoon. Like, everyone’s got a consensus. I think everyone’s also aware that there are lots of risks. But what is possible is not necessarily what’s probable. And to your point, Rebecca, like, in the next twelve months, like, this might not actually happen for twenty-four, or thirty-six, or—like, we just don’t know so many things. And so I think generally, at least the economists that I get to read, aren’t looking far enough ahead to start thinking about that because it’s not necessarily immediate enough or probable enough to start factoring into models. PATTERSON: No, I think that’s a great point, Phil. And, you know, when I’m talking to companies around the world, more of the questions I’m getting—some are on the year ahead, but an equal number are on if we’re making a strategic investment for the success of our firm down the road, how do we get through the noise? What should we be focusing on? And that takes me back to a point, Phil, you made earlier on demographics. It takes me, Fabien, to what you’re talking about with technology. Michelle, it takes me to who has consumers. So will the Chinese consumer ever recover, or do we need a complete sea change in Chinese policy? Fabien, will technology be dispersed broadly around the world, or is it winners and losers, and if you don’t have AI and AI adoption you’re left behind? And, Phil, to your point, you know, if you are a declining-population country without immigration, you’re even more dependent on that technology or something to boost productivity. I’d be curious, I’m sure you all are looking out beyond 2026. Let me start with what I think is an easier one, so is the U.S. still going to be the relative winner, the exceptional one, in five years’ time? When you think about, we have the technology, demographics aren’t as bad as some places but they’re not looking great these days, we do have the debt overhang. Are we still the nicest house on the block three to five years out? MACKINTOSH: I think that’s probably the right way to look at it. What’s interesting—I mean, the reason the Nasdaq 100 has out-performed so many other equity markets in the world is a lot of the AI technology and IP and build is coming from American companies. And so I think that’s going to help America going forward. There is a few companies in Asia—I mean, Taiwan Semiconductor is obviously a classic example that is exposed to AI and is not an American company. But we have so much more of the intellectual property, even Fabien talking about like whether we’re ahead of the models from coming out of China or not. So I think that’s going to help us going forward. To your point, you can’t stop the demographics but you can improve the productivity. And AI is probably one of the better ways to do that. CURTO MILLET: I mean, jumping on this since I heard AI. So I’m bullish on America. I mean, we’re at the frontier. We have the talent. But we need to play our cards right. I mean, you know, AI is not something that just falls from the sky like manna from heaven. You need to actually take deliberate actions for it to happen. And those deliberate actions are an all-of-government affair, from energy policy to, you know, supporting people through training and the transition. And the competition is certainly, as I mentioned, hot on the heels. Research and development, for example, China is now out-investing us. And R&D is something that has huge multiplier returns. I’m thinking of research by Ben Jones over at Northwestern. There’s a multiplier effect of 5X. It’s money very well spent. And for the first time, you know, China is outspending us on something like that. So let’s be, you know, very, very careful, because we have, you know, all the cards in our hands, but they will need to be played right as a society. PATTERSON: Yeah. I couldn’t agree with you more. I mean, I think there’s a lot of good things going on right now, AI being pretty much the top of my list. But then, even if we want to have stronger border controls, if we’re making it harder to get skilled immigrants in the country, or maybe it’s not harder but we’re having a chilling effect on them wanting to come here right now, that’s not working in our favor. Taking money away from research and development at universities that tend to be commercialized and monetized, and leading to some of that innovation, that works against us as well. And the job training. We don’t know when and how many jobs will be displaced by AI. I completely agree with you, Fabien, that over the longer term we will be net positive jobs. But in that interim period, how are we training it? Who’s training? I think your company is doing quite a lot of training. And I’ve seen others too. The government has announced that it has a million job training program. I think it was an executive order last year. But I haven’t seen anything rolled out yet. And I hope—if someone’s on this call and knows something happening, let me know. Because I’m trying to follow it and I haven’t seen anything happen yet on that. So I think there is a positive story here but, as you said, it’s not risk free. And we shouldn’t take anything for granted. Michelle, longer-term view from you. MEYER: Yeah. I would say, in addition to the sentiment already shared, it would also be around having, you know, a healthy and open financial system, capital markets, a flow of credit, to help make sure that we have continued liquidity that’s smartly regulated. You know, and then I suppose another question, particularly in terms of how the markets think about it, is the role of the dollar going forward as well. U.S. is the reserve currency. That helps us tremendously in terms of keeping borrowing costs low and keeping us quite relevant and dominant when it comes to global financial flows. So keeping an eye on that, monitoring where that goes over the next few years, will be absolutely critical as well. PATTERSON: Yeah. I mean, the dollar is definitely one of the reasons we saw a lot of overseas markets outperforming the United States equity market, and, frankly, bond market, last year. Some markets gained even without taking the dollar and foreign exchange into account, but that was definitely a kicker for some markets. I think we have another question on the line, if I can go back to my CFR colleagues. OPERATOR: We will take the next question as a written question from Paul Maidment, who asks: How vulnerable is the U.S. economy to AI-powered cyberattacks? What are the highest risk points? And how well are companies and the government preparing defenses? PATTERSON: Fabien, you know we’re going to turn that to you. CURTO MILLET: Yes. It’s a natural one to lob in my direction, although as a humble worker in the vineyard of Adam Smith I’m no cybersecurity expert. So I do not have a gage on the sort of level of securitization of our sort of U.S. infrastructure, other than to know that Google, as a company, proposes the frontier solutions in this space, and this is a critical area. But I don’t have a benchmarking, if you will, that I can offer. PATTERSON: The only thing I would add on that is I think it’s critically important for the government and private sector to continue communicating on this. And I think there’s been a lot of strides made over the last five, ten years, versus where we were, where companies almost saw it as a stigma to let anyone publicly know that they might have gotten hacked, or even a possible hack. And so there wasn’t enough communication. And I think we’ve seen a lot of change, even under the last administration with the AI Safety Institute at Department of Commerce. It’s been reshaped a little bit today, but there’s still a lot of effort going on. And I think to make sure we know within the government, within the Defense Department, within all the agencies, how to play offense, we also need to understand what’s happening at the frontier by our private companies. If we don’t understand, we don’t know how to protect. So I think that communication is pretty critical. And I’m hoping it’s happening to a sufficient degree. My understanding is it probably is, Michelle, anything you want to add—jump in? Yeah, please. MEYER: It also—yeah, I’d also offer that’s another area of innovation, the need for innovation, right? So we’re doing so much as a country, as a globe in terms of driving forward the AI technology, AI investment, and now AI adoption. But at the same time, to make sure that the innovation is happening in terms of cybersecurity and fraud, especially in a world where technology is moving so fast which could facilitate some of that cybercrime. So, you know, for us at Mastercard it’s a big part of our investment strategy is to make sure, within the payments world, that there’s the highest degree of security in terms of payments fraud, and trying to reduce—actively reduce cybercrimes as well. So it’s something that I think is happening in many different industries in terms of trying to make sure that that’s minimized in a world where technology is moving so fast. So the innovation should absolutely be happening there as well, just as fast as the innovation is in terms of AI. PATTERSON: Yeah. No. Agreed. Agreed. Well, thank you. Listen, I don’t think we have any more questions at this point and I want to be respectful of everyone’s time. I’m going to give a quick plug. I just published a research note, this afternoon actually, on CFR’s website, looking at some of the economic policies that might be ahead of us this year. And I was referring to Stephen Miran’s research paper from 2024, which I found—whether it’s coincidental or not—but a significant amount of the policies he talked about in his original paper became reality last year, from restructuring global trade to getting countries to pay more for their own defense, et cetera. And so I took a look at it again over the last few days, trying to say, OK, if this is more than coincidental, what could be next? And I’ll tell you a couple things he discussed were currency intervention to weaken the dollar. And we’re now seeing the dollar at, I think, multiyear lows after some intervention discussion in the last few days with Japan. He talked about that Treasury-Fed accord and what that might look like. And then he also discussed in his paper more possible government intervention when it comes to foreign capital flows. And there is a regulation that’s in a comment period now that would affect some sovereign wealth fund and foreign pensions in terms of capital flows, which even though it’s marginal it’s a signaling effect that I think is worth noting. So for those of us listening today who care about the U.S. economy, U.S. economic policy, and what it means for our companies, for the financial markets, some more food for thought for you on our website, in addition to this call. And I just want to thank my panelists so, so much for their insights today. Michelle, Fabien, Phil, great to have you joining us here at CFR. Thank you so much. And I hope everyone who was able to join in today, you found it equally useful. But I’ll just say thank you here. Best of luck for the year ahead. And to my CFR colleagues, I’ll let you wrap us up. (END)

Bipartisan members of the Senate Committee on Foreign Relations, U.S. Senators Christopher Coons and Pete Ricketts discuss the role of Congress—relative to the executive branch—in formulating, resourcing, and creating the institutional basis for China policy. This event is co-organized by the Council on Foreign Relations’ China Strategy Initiative and the 21st Century China Center at UC San Diego’s School of Global Policy and Strategy, as part of the annual Washington China Forum.  

Judy Malana, chaplain and captain in the U.S. Navy, Anna Page, chaplain and captain in the U.S. Army, and Sarah Schechter, retired chaplain in the U.S. Air Force, discuss religious engagement within the U.S. military. Wayne MacRae, retired chaplain and captain in the U.S. Navy, moderates the discussion. 

Panelists discuss the outlook for key commodity markets, examining the factors driving energy, industrial, and precious metals prices, and exploring the implications for the global economy and broader financial markets. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Panelists discuss renewed U.S. interest in Greenland and what it means for Arctic security, alliance cohesion, and great power competition, as the Trump administration argues the island is critical to U.S. security in an increasingly contested Arctic. To register for this virtual meeting, please click the Register or Decline button or reply to this email. Please make note of the log-in information listed in this invitation so you may access the meeting.

Join Gideon Rose for the 2025 Arthur Ross Book Award ceremony honoring this year’s medalists: Steve Coll, Jonathan Blitzer, and Sergey Radchenko. The program will feature the award presentation and a conversation with Steve Coll on the intelligence failures and strategic misjudgments that shaped the origins of America’s invasion of Iraq. CFR’s annual Arthur Ross Book Award recognizes books that make an outstanding contribution to the understanding of foreign policy or international relations. The prize, endowed by the late Arthur Ross in 2001, is for nonfiction works from the past year, in English or translation, that merit special attention for: bringing forth new information that changes the understanding of events or problems; developing analytical approaches that offer insights into critical issues; or introducing ideas that help resolve foreign policy problems.

This event will explore the results of the 2026 Preventive Priorities Survey which polls hundreds of foreign policy experts every year to assess thirty ongoing or potential violent conflicts and their likely impact on U.S. interests. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.  

CFR Military Fellows discuss their career pathways and how U.S. defense policy has evolved through their years in service. The CFR Young Professionals Briefing Series provides an opportunity for those early in their careers to engage with CFR. The briefings feature remarks by experts on critical global issues and lessons learned in their careers. These events are intended for individuals who have completed their undergraduate studies and have not yet reached the age of thirty to be eligible for CFR term membership.

For two-and-a-half centuries, the United States has faced a challenging world. Some of its responses have made Americans proud. Others have not. CFR asked members of the Society for Historians of American Foreign Relations what they considered the best and worst U.S. foreign policy decisions. This event will discuss the results of the project. To mark the 250th anniversary of the U.S. declaration of independence, CFR is dedicating a year-long series of articles, videos, podcasts, events, and special projects that will reflect on two and a half centuries of U.S. foreign policy. Featuring bipartisan voices and expert contributors, the series explores the evolution of America’s role in the world and the strategic challenges that lie ahead.

Panelists explore opportunities for the United States to develop and deploy emerging energy technologies to better compete with China and other global rivals, as well as discuss pragmatic ways to expand federal investment in energy innovation and maximize its impact. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. This meeting is presented in partnership with CFR’s Climate Realism Initiative.

John C. Williams of the Federal Reserve Bank of New York discusses monetary policy and the economic outlook for the year ahead. The C. Peter McColough Series on International Economics brings the world’s foremost economic policymakers and scholars to address members on current topics in international economics. This meeting series is presented by the Maurice R. Greenberg Center for Geoeconomic Studies.  

Panelists discuss the latest unrest in Iran, the economic pressures that have sparked nationwide protests, and the implications for U.S. policy amid ongoing regional tensions. This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.  

Panelists discuss the role of nuclear energy in emerging economies, including its potential to reduce energy poverty and lower emissions, and consider the key challenges facing its adoption. Please note there is no virtual component to the meeting.

The World Economic Update highlights the quarter’s most important and emerging trends. Discussions cover changes in the global marketplace with special emphasis on current economic events and their implications for U.S. policy. This series is presented by the Maurice R. Greenberg Center for Geoeconomic Studies and is dedicated to the life and work of the distinguished economist Martin Feldstein. Please note there is no virtual component to the meeting.

Panelists discuss the impact of recent refugee and immigration policy developments on the U.S. economy. The Silberstein Family Annual Lecture on Refugee and Migration Policy was established in 2019 through a generous gift from Alan M. Silberstein and the Silberstein family. The lecture provides CFR with an annual forum to explore emerging challenges in refugee and migration policy in the United States and around the world. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Joseph Glauber, senior research fellow at the International Food Policy Research Institute, discusses the economic impacts of federal policies on U.S. agriculture and international commodity markets.

Panelists discuss the status of the conflict in Sudan, including the deteriorating condition of civilians, the prospect for regional stability, and the options for an international response. This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Sergei Chapnin, director of communications at Fordham University's Orthodox Christian Studies Center; Katherine Kelaidis, director of research and content at the National Hellenic Museum; and Andreja Bogdanovski, freelance journalist and analyst, will discuss the role of the Russian Orthodox Church (ROC) in global affairs. Timothy Snyder, senior fellow for democracy at CFR and Richard C. Levin professor of history at Yale University, will moderate the discussion. 

David Miliband, president and chief executive officer of the International Rescue Committee (IRC), presents the new IRC Emergency Watchlist report, highlighting the countries at highest risk of humanitarian crises in 2026 and examining where the international community has made progress or fallen short. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

From the ongoing spill-over of the conflict in Sudan into Chad to the resurgence of military coups in countries such as Niger and Burkina Faso, and to the democratic election in Senegal, the Sahel region of Africa has remained in the news. The EU Special Representative for the Sahel Region discusses the forces shaping the region’s sociopolitical and demographic transformation, and the steps taken by the European Union to address these challenges and support long-term regional stability.

Panelists discuss how youth-driven protest movements are shaping global political change and examine how these movements work to sustain momentum after major political transitions.  

The Martin S. Indyk Memorial Lecture was established by CFR to honor Ambassador Martin S. Indyk’s legacy of public service, scholarship, and institution building, and to recognize his ideas and contributions that shaped U.S.-Middle East policy for decades. Ambassador Indyk was a CFR distinguished fellow and former U.S. ambassador to Israel. The lecture highlights critical issues in U.S. foreign policy that reflect his commitments to advancing durable pathways to peace and sustaining American diplomatic engagement. This inaugural lecture is held in collaboration with the Clinton Global Initiative. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Director of the National Institutes of Health Jay Bhattacharya discusses the latest developments in biomedical innovation and how they will shape the future of public health research. If you wish to attend virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

CFR experts discuss President Donald Trump’s approval of advanced artificial intelligence (AI) chip sales to China and what that decision means for the future of AI, national security, and U.S.-China relations.  The recording and transcript of this meeting will be posted on the CFR website. 

Catherine Bertini, emeritus professor of practice at Syracuse University, discusses how the United States’ trade war is affecting farmers and food supply across the country. The host of the webinar i…

Quantum technologies are redefining the landscape of science and policy. National leading experts Spyridon Michalakis and Gorjan Alagic explore the foundations of this emerging field and its implications for innovation, security, and global governance.   The Science Fair Series is a new meeting series highlighting cutting-edge developments in emerging technologies that will impact foreign affairs. This event is made possible by the support of the MacArthur Foundation, Rockefeller Philanthropy Advisors, and the Hewlett Foundation.

CFR experts discuss the Trump administration’s new National Security Strategy released on December 4 and what it means for the future of U.S. security. Before the event, read CFR experts’ breakdown of the document. The video and transcript of this meeting will be posted on the CFR website. Please join the Zoom event at least five minutes before the start of the presentation by using the below details: Understanding President Trump’s National Security Strategy Webinar ID: 832 8657 8996 Passcode: 475991

Panelists discuss how U.S. presidents have leveraged executive power to confront political violence, human rights abuses, and other global challenges, highlighting the ways presidential leadership has shaped America’s legacy of responsibility, reconciliation, and transitional justice. Please note there is no virtual component to the meeting. 

Efforts to end the war in Ukraine gained momentum in recent days as a result of newly developed peace plans. CFR fellows discuss the current state of play and prospects for peace in Ukraine. This meeting is part of the Council’s Special Initiative on Securing Ukraine’s Future and the Wachenheim Program on Peace and Security, which are made possible by the generous support of the Ed and Sue Wachenheim Foundation.  This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Panelists discuss the geopolitical implications of transformative technologies like artificial intelligence, including how decision-makers are navigating governance, balancing innovation with risk, and addressing questions of equity and accountability.  

The United States faces evolving threats from China, Russia, Iran, and North Korea, but a culture of overclassification of intelligence results in the routine failure to share vital information at speed and scale. In an example of bipartisanship, panelists discuss how the United States can reform its national security information policies, regulations, and laws to ensure crucial insights are shared quickly and effectively across government. Please note there is no Zoom component to the meeting. 

Representatives Lois Frankel (D) and Jen Kiggans (R), cochairs of the bipartisan congressional Women, Peace, and Security Caucus discuss the role of women in advancing democracy and stability worldwide. Please note there is no virtual component to the meeting.

Former U.S. Secretary of State and former U.S. Special Presidential Envoy for Climate John Kerry discusses the state of global and U.S. climate policy, the opportunities and challenges of advancing energy innovation, and the potential for economic growth through clean technology leadership. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

In its important new report, U.S. Economic Security: Winning the Race for Tomorrow’s Technologies, the CFR Task Force on Economic Security finds that strategic competition over the world’s next generation of foundational technologies is underway, and U.S. advantages in artificial intelligence, quantum, and biotechnology are increasingly contested. The high-level, bipartisan Task Force warns that economic security risks, especially overconcentration of critical supply chains in China and underinvestment in strategically important areas at home, threaten American leadership in these three crucial sectors of the future. The Task Force report provides a comprehensive view of vulnerabilities that the United States must address and offers practical recommendations for mobilizing the resources needed to prevail.  For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.  This Task Force is part of RealEcon: Reimagining American Economic Leadership, a CFR initiative of the Maurice R. Greenberg Center for Geoeconomic Studies. Members may bring a guest to this event.

As leaders gather in Brazil to discuss international climate policy for COP30, panelists discuss the future of global climate negotiations and reflect on lessons learned from past climate diplomacy efforts, including the legacy of COP3's 1997 Kyoto Protocol. The Royal Shakespeare Company's production of Kyoto is now playing at Lincoln Center Theater in New York. Kyoto tells the story of the tense negotiations during the third COP at the Kyoto Conference Centre in December 1997. A limited number of seats for the performance on November 12 has been offered to CFR members for purchase. If you are interested, please contact [email protected] or look for the invitation on CFR.org/member.   This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this virtual meeting will be posted on the CFR website. This meeting is presented in partnership with CFR's Climate Realism Initiative.

In a collaboration between CFR and Open to Debate, panelists debate the legal, moral, operational, and diplomatic trade-offs of the Trump administration's recently authorized military strikes against suspected drug trafficking vessels and its designation of certain cartels as foreign terrorist organizations. Supporters argue this is a necessary deterrent and part of a broader strategy to treat narcotrafficking as a national security threat. Critics claim it violates domestic and international law, undermines sovereignty, risks civilian harm, and may provoke dangerous escalation. Under what circumstances, if any, is military force justified in combating drug trafficking networks? Open to Debate is the nation’s only nonpartisan, debate-driven media organization dedicated to bringing multiple viewpoints together for a constructive, balanced, respectful exchange of ideas. Open to Debate is a platform for intellectually curious and open-minded people to engage with others holding opposing views on complex issues. Please note there is no virtual component to this meeting. The recording of this debate will be posted on the CFR and Open to Debate websites and broadcast on NPR stations nationwide.

Panelists discuss and share advice on navigating different foreign policy career pathways in both the public and private sector. The CFR Young Professionals Briefing Series provides an opportunity for those early in their careers to engage with CFR. The briefings feature remarks by experts on critical global issues and lessons learned in their careers. These events are intended for individuals who have completed their undergraduate studies and have not yet reached the age of thirty to be eligible to apply for CFR term membership. We are pleased to extend this invitation to you through the recommendation of a CFR member. If you no longer wish to receive these invitations, please let us know by replying to this email. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Panelists discuss the new frontiers of intelligence gathering, examining how emerging technologies are transforming espionage, expanding its reach to the public domain, and reshaping the future of U.S. national security. If you wish to attend virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Representative Jim Himes discusses threats to America’s national security and the role of the intelligence community in safeguarding American interests. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register.

Following President Trump’s trip to Asia last week, CFR fellows discuss the outcome of bilateral trade dialogues with the leaders of Malaysia, Japan, and South Korea; takeaways from talks with Chinese President Xi Jinping; and the future of the United States’ economic relationships in the region.

Representative Adam Smith discusses his vision for U.S. global engagement, defense, and diplomacy, and shares his insights as ranking member of the House Armed Services Committee. If you wish to attend virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.

Margaret Woolley Busse, executive director of the Utah Department of Commerce and cofounder of the state’s Office of Artificial Intelligence Policy, discusses the regulatory environment for artificial intelligence in the United States, with particular focus on its implications at the state and local level. Adam Segal, Ira A. Lipman chair in emerging technologies and national security and director of the Digital and Cyberspace Policy Program at CFR, assesses the global race in artificial intelligence and why these dynamics matter for U.S. national security and the strategic competition with China.

Measles, whooping cough, and other vaccine-preventable diseases are on the rise around the world, and cuts to foreign aid, coupled with growing vaccine hesitancy, and persistent gaps in vaccine access are fueling outbreaks in poor and wealthy nations alike. Global health experts discuss the drivers of these outbreaks, the solutions that can advance vaccine equity and better public health worldwide, and a new vaccine-preventable disease tracker from Think Global Health, developed in collaboration with ProMED. For those attending virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. The audio, video, and transcript of this meeting will be posted on the CFR website.

Qatari Prime Minister Sheikh Mohammed bin Abdulrahman Al Thani discusses Qatar’s regional role, including its mediation efforts in Sharm El Sheikh and its response following the Israeli attack in Doha. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.

Bob (Xiqiu) Fu, founder and president of ChinaAid; Louisa C. Greve, director of global advocacy for the Uyghur Human Rights Project; and Cynthia Sun, senior researcher at the Falun Dafa Information Center, examine the Chinese government’s policies towards ethnic and religious minorities, exploring their implications for international human rights, global religious freedom, and U.S.-China relations. Sarah Cook, independent researcher and consultant, moderates the discussion.

The Paul C. Warnke Lecture on International Security is dedicated to the memory of Paul C. Warnke, member and director of the Council on Foreign Relations. The series commemorates his legacy of courageous service to our nation and to international peace.  

We invite you to a special screening of the new American Experience film, Kissinger, followed by a panel discussion on diplomacy, foreign policy, and global leadership. The film offers an incisive portrait of Henry Kissinger, a prominent figure who served in the highest levels of American diplomacy. It traces his life from his childhood in Hitler’s Germany to his years as a Nazi hunter in the United States Army, his rise through American foreign policy, and his tortured relationship with President Richard Nixon, exploring the contradictions that defined both his pursuit of power and America’s role in the world.  

General Charles Q. Brown, Jr. discusses the most pressing geopolitical challenges facing the United States and the world today and reflects on the lessons learned throughout his distinguished career. Log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this meeting will be posted on the CFR website. PLEASE NOTE: This meeting is part of the Thirtieth Annual Term Member Conference. All CFR members are invited to attend this session virtually, but preference for the Q&A session will be given to term members.

Senior Counsel for Trade and Manufacturing Peter Navarro discusses U.S. economic strategy under the Trump administration, including America First policy, tariffs, and manufacturing. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. The audio, video, and transcript of this meeting will be posted on the CFR website.

Panelists discuss international financial initiatives to support Ukraine’s reconstruction and revitalizing its infrastructure and economy in the aftermath of Russia’s military aggression. This event is part of the Council’s Special Initiative on Securing Ukraine’s Future which provides timely, informed analysis and practical policy recommendations for U.S. policymakers and the American public.  

Jessica Bissett, senior director of government engagement at the National Committee on United States-China Relations, examines how subnational engagement shapes U.S.-China relations and what these dynamics mean for local economic resilience amid ongoing trade tensions. Zongyuan Zoe Liu, the Maurice R. Greenberg senior fellow for China studies at CFR, discusses recent developments in bilateral trade policy, including the effects of U.S. tariffs and China’s retaliatory measures.

Federal Reserve Governor Christopher Waller discusses the U.S. economic outlook in the year ahead. The C. Peter McColough Series on International Economics brings the world’s foremost economic policymakers and scholars to address members on current topics in international economics. This meeting series is presented by the Maurice R. Greenberg Center for Geoeconomic Studies.  

Subindra Bogati, founder and chief executive of the Nepal Peacebuilding Initiative, and Meghan Nalbo, Nepal country representative at the Asia Foundation, discuss how the appointment of Nepal’s interim prime minister, alongside the recent Gen Z–led protests, is reshaping the country’s governance, democratic institutions, and development. Joshua Kurlantzick, senior fellow for Southeast Asia and South Asia at CFR, moderates the discussion. 

In partnership with Columbia University's School on International and Public Affairs, panelists discuss what effective crisis decision-making looks like in practice, how to understand America’s adversaries, and lessons for future leaders navigating crises in national security. Secretary Hillary Rodham Clinton and Columbia SIPA Dean Keren Yarhi-Milo's new book, Inside the Situation Room, offers a window into how presidents and policymakers weigh risks, build consensus, and communicate their decisions to the wider public. Blending fresh case studies with insights from political science, and inspired by their popular class at Columbia, the book offers a framework for understanding leadership under pressure and the art of managing crises in real time. Copies of Inside the Situation Room will be available for purchase during the event. The David A. Morse Lecture was inaugurated in 1994 and supports an annual meeting with distinguished speakers. It honors the memory of David A. Morse, an active Council on Foreign Relations member for nearly thirty years.

Renée DiResta, associate research professor at Georgetown University, discusses how disinformation and digital manipulation are undermining public trust and reshaping the media landscape. The host of…

At the midpoint of CFR’s Global Board of Advisors’ annual two-day summit, we invite you to a seated lunch with members of CFR’s Global Board. The lunch will be followed by a discussion featuring Global Board members on the shifting international system and the future of global governance in an era of geopolitical and economic uncertainty. Please note there is no virtual component to the meeting. The audio, video, and transcript of this meeting will be posted on the CFR website.

Exiled Crown Prince of Iran Reza Pahlavi discusses his perspective on the durability of the Islamic Republic regime, his framework for democratic transition, and the role of the international community in shaping Iran’s future. Please note there is no virtual component to the meeting. The audio, video, and transcript of this meeting will be posted on the CFR website.

The head of the Federal Reserve Bank of Boston discusses the U.S. economic outlook and monetary policy.

In a conversation with Jill Dougherty, former CNN Moscow bureau chief and author of My Russia: What I Saw Inside the Kremlin, Linda Robinson, senior fellow for women and foreign policy at CFR, discusses Russia’s evolution under President Vladimir Putin, including President Putin's impact on youth, women, the media, and other groups, as well as the impact of the war in Ukraine.

UN High Commissioner for Human Rights Volker Türk discusses the most pressing human rights issues around the world. For those attending virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. The audio, video, and transcript of this meeting will be posted on the CFR website. The Sorensen Distinguished Lecture on the United Nations was established in 1996 by Gillian and Theodore C. Sorensen to highlight the United Nations and offer a special occasion for its most distinguished and experienced leaders to speak to the Council membership.  

Minister Asaad Al-Shaibani discusses Syria-U.S. relations and Syria’s international reengagement, including sovereignty, sanctions relief, global partnerships, and foreign policy priorities.

President Hassan Sheikh Mohamud discusses Somalia’s political and economic developments, governance, regional relations, and the country’s role in the world. For those attending virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this meeting will be posted on the CFR website.

Fatih Birol shares insights on the current state of global energy markets, emerging risks to energy security, and the steps government and industry leaders must consider to ensure a more affordable, secure, and sustainable energy future. This meeting is presented in partnership with CFR’s Climate Realism Initiative.  Please note there is no virtual component to the meeting. The audio, video, and transcript of this meeting will be posted on the CFR website.

President Rashad Al-Alimi discusses Yemen’s foreign policy priorities, regional security, and the country’s humanitarian situation. Please note there is no virtual component to the meeting. The audio, video, and transcript of this meeting will also be posted on the CFR website.

Foreign Minister Gabriela Sommerfeld of Ecuador discusses the country’s foreign policy priorities, focusing on challenges to national security and criminal activity, while emphasizing initiatives to strengthen trade relations and international partnerships. If you wish to attend virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid event will be posted on the CFR website.

President Cyril Ramaphosa discusses South Africa’s domestic agenda, bilateral trade relations with the United States, the future of BRICS, and the country’s role in the region. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this meeting will be posted on the CFR website.

CFR experts analyze President Donald Trump’s speech to the UN General Assembly on Tuesday, September 23, and discuss how it will shape further dialogue on trade, immigration, European security, and U.S. relations with Asia, Latin America, and the Middle East. The video and transcript of this briefing will be posted on the CFR website. Please join the Zoom event at least five minutes before the start of the presentation by using the below details: Unpacking the President’s UNGA Speech Webinar ID: 860 4047 0149 Passcode: 738479

President Netumbo Nandi-Ndaitwah discusses Namibia’s socioeconomic developments, climate issues, nuclear energy, trade, and the country’s role in the region. For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this meeting will be posted on the CFR website.

Prime Minister Mark Carney discusses Canada's foreign policy priorities and the new global economy. Inaugurated in 1969, the Russell C. Leffingwell Lecture was named for Russell C. Leffingwell, a charter member of the Council who served as its president from 1944 to 1946 and as its chairman from 1946 to 1953. The lecture is given by distinguished foreign officials, who are invited to address Council members on a topic of major international significance. If you wish to attend virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid event will be posted on the CFR website.  

His All-Holiness Ecumenical Patriarch Bartholomew, archbishop of Constantinople and New Rome and the ecumenical patriarch of the Eastern Orthodox Church, and His Eminence Archbishop Elpidophoros of America, archbishop of the Greek Orthodox Archdiocese of America and most honorable exarch of the Atlantic and Pacific oceans, explore today’s pressing global challenges—particularly regional instability, climate change, and the displacement of refugees—and the moral duty of faith communities to engage and help address these issues. Frances Fragos Townsend, founder of FFT LLC and member of the CFR Board of Directors, moderates the conversation. This meeting is part of CFR’s Religion and Foreign Policy (RFP) program. The Religion and Foreign Policy program offers a forum for clergy, seminary heads, and representatives of faith-based organizations to discuss global issues in an interfaith environment, and serves to inform the geopolitical work of religious leaders and foster dialogue in their communities. 

Snap Inc. Cofounder and CEO Evan Spiegel discusses the growth and evolution of the company, implications of technological innovation on data privacy, developments in artificial intelligence, and how businesses are adapting to geopolitical and macroeconomic uncertainty. The Bernard L. Schwartz Annual Lecture on Economic Growth and Foreign Policy series focuses on two areas: the evolution of the relationship between business and government in the making of foreign policy, and ways for government to make better use of business in solving foreign policy problems

David M. Hart, senior fellow for climate and energy at CFR, discusses the increasing demand on energy from data centers to power artificial intelligence and implications for the future of climate pol…

Former national security advisors discuss the recent changes to the National Security Council and the foreign policy challenges facing the United States. For those attending virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. The audio, video, and transcript of this meeting will be posted on the CFR website.

Panelists discuss the progress made toward achieving the seventeen United Nations Sustainable Development Goals and the prospects for advancing the global agenda on poverty reduction, climate action, health, and inclusive economic growth by 2030. Please note there is no virtual component to the meeting. The audio, video, and transcript of this meeting will be posted on the CFR website.  

Panelists discuss the role of industrial policy and how the U.S. government shapes markets to encourage innovation, protect economic security, and maintain a strategic edge as global competition intensifies.Copies of Marketcrafters: The 100-Year Struggle to Shape the American Economy and Chokepoints: American Power in the Age of Economic Warfare will be available for purchase.For those attending virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this meeting will be posted on the CFR website. 

Max Boot, the Jeane J. Kirkpatrick senior fellow for national security studies at CFR, discusses the evolving role of the U.S. National Guard in responding to state and federal priorities. Marc H. Sa…

Representative Ro Khanna discusses whether the United States should recognize Palestine as a sovereign state and the future of the region. If you wish to attend virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.

In The Age of Change: How Urban Youth are Transforming African Politics, Michelle Gavin explains how demographic trends and unsatisfying political narratives are converging to trigger new volatility in African politics, and how that volatility informs African countries’ engagement with the rest of the world. It is written for a reader interested in the geopolitical shifts driving global events, not just experts in African affairs. Tapping into the irreverent humor and insight of African political discourse on social media, the book helps readers jettison anachronistic ideas about African societies, understand how specific histories inform individual countries’ trajectories, and recognize that a regional search for new political models is underway. The CFR Fellows’ Book Launch series highlights new books by CFR fellows. Please note that members will receive an offer to claim a complimentary copy of this book, and copies will be available for purchase at the event.  For those attending virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.

Musimbi Kanyoro, chair of the United World Colleges international board, and Olivia Wilkinson, senior fellow with the Faith and Global Health Initiative of the Georgetown University Global Health Institute, discuss how religious communities and civil society advance the United Nations’ Sustainable Development Goals (SDGs). Azza Karam, founding president and CEO of Lead Integrity, moderates the conversation. 

Panelists discuss U.S. policy options in the Middle East following the Twelve Day War, with particular attention to security commitments, regional stability, and avenues for diplomacy. This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this virtual meeting will be posted on the CFR website.  

Senator Jeanne Shaheen discusses the future of United States foreign policy. If you wish to attend virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.  

Former UN Undersecretary-General Sigrid Kaag discusses the state of humanitarian assistance in Gaza and the role of the international community in supporting relief efforts. This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this virtual meeting will be posted on the CFR website.

The World Economic Update highlights the quarter’s most important and emerging trends. Discussions cover changes in the global marketplace with special emphasis on current economic events and their implications for U.S. policy. This series is presented by the Maurice R. Greenberg Center for Geoeconomic Studies and is dedicated to the life and work of the distinguished economist Martin Feldstein. Please note there is no virtual component to the meeting. The audio, video, and transcript of this meeting will be posted on the CFR website.  

Secretary Chris Wright discusses the administration’s priorities for U.S. energy security, innovation, and global competitiveness. If you wish to attend virtually, log-in information and instructions on how to participate during the question-and-answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid event will be posted on the CFR website.

U.S. Senator Elissa Slotkin shares her vision for the future of American national security and foreign policy. If you wish to attend virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid event will be posted on the CFR website.

CFR President Mike Froman discusses his career, priorities for the Council, and the current events affecting U.S. foreign policy.The CFR Young Professionals Briefing Series provides an opportunity for those early in their careers to engage with CFR. The briefings feature remarks by experts on critical global issues and lessons learned in their careers. These events are intended for individuals who have completed their undergraduate studies and have not yet reached the age of thirty to be eligible to apply for CFR term membership.If you wish to attend virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.

Panelists discuss developments in Russia’s war in Ukraine following the recent Trump-Putin summit in Alaska and the subsequent meeting with President Zelenskyy and European leaders in Washington. This event is part of the Council’s Special Initiative on Securing Ukraine’s Future which provides timely, informed analysis and practical policy recommendations for U.S. policymakers and the American public This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this virtual meeting will be posted on the CFR website.

Panelists discuss the recent reorganization of the U.S. Department of State, including the reasons behind the structural changes and the impact on U.S. humanitarian efforts and broader foreign policy objectives.   This is a virtual meeting through Zoom. Log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this virtual meeting will be posted on the CFR website. This meeting is presented by RealEcon: Reimagining American Economic Leadership, a CFR initiative of the Maurice R. Greenberg Center for Geoeconomic Studies.

Thomas J. Reese, senior analyst for Religion News Service; Stephen Schneck, commissioner of the U.S. Commission on International Religious Freedom; and George Weigel, senior fellow of the Ethics and Public Policy Center, discuss Pope Leo XIV’s foreign policy priorities during his first 100 days and the Vatican’s evolving role in international diplomacy. Claire Giangravé, Vatican reporter for Religion News Service, moderates the conversation. 

CFR experts from the Council’s Special Initiative on Securing Ukraine’s Future will discuss potential U.S. actions if Russian President Vladimir Putin rejects U.S. President Donald Trump’s demands for a ceasefire deal and what options remain to end the war in Ukraine.

Panelists discuss Saudi Arabia’s growing geopolitical role, the leadership of Crown Prince Mohammed bin Salman, and the transformation of the Kingdom from recent reforms.Copies of The Man Who Would Be King: Mohammed bin Salman and the Transformation of Saudi Arabia will be available for purchase.If you wish to attend virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid event will be posted on the CFR website.

Panelists discuss American views on national security and global engagement, and how public sentiment may shape the future of U.S. foreign policy. For further reading, please see the Reagan Institute’s Summer Survey results on American views of foreign policy and national security. If you wish to attend virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.

Representative Gregory Meeks discusses the Democratic vision for the future of U.S. foreign policy. If you wish to attend virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.

Panelists explore the shifting landscape of journalism, including the influence of political pressures, and the broader implications for press freedom and democratic values worldwide. Please note there is no virtual component to the meeting. The audio, video, and transcript of this meeting will be posted on the CFR website.

Panelists discuss the latest announcements from the Trump administration on tariffs and trade agreement negotiations, the likelihood of extended pauses on tariffs for specific countries, and how businesses and the market are navigating trade policy uncertainties. CVETKOVA: Thank you, Alexis. Welcome, everyone, to today’s on-the-record Council on Foreign Relations virtual meeting on U.S. trade policy and tariffs. My name is Dima Cvetkova. I work for Moody’s Corporation. And I have the great pleasure of moderating this session. We have an excellent panel of experts joining us today who will help us disentangle the trade signal from the noise. We have with us Jennifer Hillman from Georgetown University Law Center and the Center for Inclusive Trade and Development; Inu Manak, a CFR fellow for trade policy; and Francisco Sanchez, partner with Holland & Knight, and a former undersecretary of commerce for international trade with the Obama administration. Jennifer, I know you need to head out a little bit early, so let’s get started. So we have now reached the end of the ninety-day pause on the liberation day tariffs enacted to—which were enacted to allow for trade negotiations between the U.S. and trading partners. However, the deadline for the tariffs and the trade negotiations has moved to first of August, with only two framework trade deals put in place—one with the U.K., and one with Vietnam. So my first questions to the panelists are, what was actually achieved during the first ninety days? What should we expect on the U.S. front over the next few weeks or even next months? And does uncertainty around trade negotiations bring more concessions to the U.S.? Francisco, would you like to start? SANCHEZ: Yes. Thank you, Dima. It’s a pleasure to be with you, and with Inu and Jennifer. Thanks to the Council for inviting me. I think it would be good to start with what is the underlying goals—what are the underlying goals that President Trump and his administration are trying to achieve, and then see what he has achieved. Clearly, one objective is just as a negotiation strategy. You might describe President Trump’s strategy is one of sticks and no carrots. And so he’s trying to make it necessary, if you will, to have people come to the—countries come to the table. That’s one. Two, President Trump, long before he was ever in politics, was feeling that American business is unfairly treated by other countries in the world. So he’s seeking to find more fairness for American business. Third, he’s trying to bring back manufacturing to the United States. And, fourth, to raise revenue. And finally, fifth, he’s looking for cooperation on non-tariff barriers that a lot of countries engage in. I would say at this point the success, if you measure it against those five goals, is rather limited. As you correctly point out, there two agreements—framework agreements. The details haven’t been worked out. When he made that announcement back in April, some members of his administration said there’d be ninety deals in ninety days. I think it’s going to be difficult. One, USTR is a rather small agency. They don’t have the resources they need to do a lot of deals. That’s number one. And, number two, negotiating trade deals is hard. India, for example, started negotiations with us in February, and here it is now nearly the middle of July and we still don’t have a deal. So I think it’s going to be slow moving. There’ll probably be some deals done before the August deadline, but I don’t think there’ll be a lot. CVETKOVA: Thank you, Francisco. And I’m going to turn over to Inu. I remember reading one of the articles she published. And she was talking about the average time it takes to sign a trade deal, which has nothing to do with the ninety days we have now. So, Inu, what is your take on what we should expect by the first of August and beyond that? MANAK: Yeah. I mean negotiating trade agreements is very hard. It takes, usually, 917 days to negotiate a trade deal. So that is definitely not that ninety-day deadline that President Trump was hoping to conclude a ton of deals in. So I’m not surprised that we only have basically 1.5 deals that we know of, right? So the U.K. deal, the text is out. We’ve seen what’s in it. The Vietnam deal, we’ve heard a little bit about what might be in it, but we have seen no text. And it seems like there’s still a bit of ironing of the details going on. So what have we seen so far? If we look at the deals and the structure of what the administration seems to be negotiating, it looks to be about five different aspects that they’re trying to nail down. First is really trying to get tariff reductions where they can, because tariffs are a big part of President Trump’s trade strategy. Second is to have some sort of cooperation on non-tariff barriers. They haven’t really defined what they are, but said if you look at the national trade estimate report it’s all in there. So that’s where countries can actually take a look. The third item that they’re looking at is digital trade provisions, trying to figure out how to get countries on board to U.S. approaches to digital trade. The fourth item has been some sort of cooperation on economic security. This is kind of vaguely defined, and it varies by country, but it means a little bit more investment screening, perhaps a little bit more monitoring of supply chains to ensure there’s not transshipment of goods from China, and other aspects of economic security measures that they may want to undertake. And then the last part are commercial considerations sort of broadly defined. This includes things like encouraging investment in the United States to help boost the manufacturing base and also purchase agreements as well, like ethanol, which the U.K. actually signed up for. So if you kind of look at the U.K. agreement in particular—so that’s the one that we have. It’s five pages. So it’s a quick read. But it reads more like a term sheet than a trade agreement. So folks who are used to reading trade agreements, it’s a little puzzling to see it because you’re, like, what are you trying to do here? It’s a deal that resolves some trade irritants. It’s mostly a framework for future negotiations on a range of issues, but doesn’t really resolve all those issues right now. And, importantly, what it does is sets the stage for negotiation on future Section 232 national security tariffs that may come in place, but doesn’t guarantee that the U.K. is going to get any carveouts there. So it basically leaves open a negotiation that’s going to happen over and over again over the coming years. And it’s not clear where the landing point is going to be. And Vietnam has a very similar structure in its agreement as well. So I imagine we’re going to see more of these come through slowly in the next couple of weeks, but what we’re seeing is really rough contour of what every single country is going to be negotiating. CVETKOVA: So this is going to actually continue a lot longer, you know, after this sort of framework—basic framework is signed. Negotiations will continue for a lot longer. Jennifer, over to you. The same questions with a little bit—from a different angle. We just talked about—before we started the meeting—about the average tariff rates for the U.S., and all the reasoning behind the tariffs. Could you please comment on that? HILLMAN: Yeah. I mean, clearly, you know, one of the things that has been, if you will, achieved, is a significant raising of taxes on Americans. You know, again, so if these tariffs that the president has now announced, you know, through July 7—including, again, the Vietnam trade framework agreement, the U.K. agreement, and, you know, the announcements of these new rates on fourteen more countries. If those go into effect, we will end up with an average U.S. tariff in the United States—average tariff, again, so plenty of them that would be higher than that—of 17.6 percent, which is the highest rate that we’ve seen on our tariffs since 1934. And, again, we have to remember, at their core, you know, that tariffs are taxes, you know, on American consumers. Because it is the importer in the United States that’s paying that tax. And therefore, we have to remember that these are very regressive taxes, meaning low- and moderate-income people are the ones that bear by far the largest brunt of these taxes. Because it is low- and moderate-income people that are spending 30 or 40 percent of their income buying the kinds of goods—you know, shoes, and clothing, and all kinds of the goods that are the subjects of these tariffs. Again, they’re spending 40 percent of their income. High-income people are spending less than 10 percent of their income, you know, purchasing these goods that are subject to the tariffs. So whatever else they’re doing, they are raising taxes very substantially on Americans. Which, again, feeds into one of the goals here being, you know, to raise revenue. Again, but it is raising revenue heavily on the backs of those Americans that are being taxed. CVETKOVA: Great. Thank you for that. And it’s a great segue to my next question, which is, you know, the U.S. administration announced the trade deals as the best deals for American people and American workers. And this is back to you, Francsico. How is the trade agenda impacting American households, building on what Jennifer said, and businesses? And what could be some important positive and negative outcomes of the trade negotiations? SANCHEZ: Well, it will undoubtably impact a number of sectors more significantly than others—electronics, automotive, retail, construction materials, certain foods. We’re likely to see that go up. As Jennifer said, this is essentially a tax. And so you’re likely to see costs go up. On jobs, it’s interesting. If you take steel, for example, he’s—President Trump has increased tariffs on steel and aluminum. The steel industry has approximately 90,000 millworkers. And if you take their industry as a whole, they probably employ upwards to about 280,000 people in total. That includes office workers, salespeople, everybody. If you put tariffs on steel, then you’re likely to see more production, so their employee numbers may go up because there’ll be more demand for American steel. But compare that to automotive. The automotive industry in the United States has about four million employees. If the cost of inputs for the automotive industry goes up, there’s a chance that that sector will see a drop in sales and you could actually see a drop in the number of employees in the automotive sector that would dwarf any increase in the steel industry. Worse than that, I’d say, would be construction. We have about eleven million people that work in construction. It’s a sector that’s very dependent on steel. So you’ll see potentially a major reduction in the number of employees in the construction space that also would dwarf any increase. So while there’d be a benefit in the steel industry, you could see other sectors, like construction and the automobile manufacturing, actually go down. CVETKOVA: Inu and Jennifer, would you like to add anything to what Francsico was saying. MANAK: Go ahead, Jennifer. HILLMAN: I mean—I mean, to some degree I think you’re already seeing a little bit of this. If you look, for example, at the price of steel in the United States compared to the price of steel elsewhere in the world, you know, again—I, you know, recently looked at the numbers; the price for a hot rolled sheet of steel in the United States is over $900 a ton, whereas the world average price is $400 a ton. The average price in Europe, around $600 a ton. So if every manufacturer in the United States that needs to purchase steel to use it to make a product out of it is spending almost twice as much as any of their competitors are for that basic component, you know, the concern is what it does to long-term competitiveness. You know, and then you turn to things like construction. You know, again, in addition to the tariffs on steel and aluminum, and now these across-the-board tariffs—these so-called reciprocal tariffs on these, you know, fourteen-plus countries that are above the 10 percent that’s been added onto everybody in the world—and, again, you start to see it. And then you look at what is likely coming, which is a number of these section—so-called Section 232 national security tariffs. So, again, we have to remember that there are investigations pending right now today on semiconductors, on pharmaceuticals, on copper, on timber and lumber—again, heavily involved in construction—on critical minerals and derivative products, on medium and heavy-duty trucks and parts, and on commercial aircraft and jet engines. So if, again, we were to result in even more tariffs on all of those sectors on top of all of these others, you can see what a significant impact it could have in a number of these key sectors of our economy. CVETKOVA: So can I follow up on that actually? We were talking about we were talking about legal challenges, and there is a lot of talk about legal challenges to these tariffs. So, as a legal expert, can I ask you, do you think that legal challenges can derail the U.S. trade agenda? HILLMAN: I certainly think that there’s a very good chance that the legal challenges will at least temporarily derail the tariffs that have been imposed under the International Economic Emergency Powers Act, or IEEPA. Again, and that is all of these 10 percent across the board tariffs, and all of the tariffs that we’ve just described that are the ones under the U.K. agreement, the Vietnam agreement, and, again, the new tariffs that were announced last night against these fourteen countries—all of the so-called reciprocal tariffs. Those were all imposed under IEEPA, as were the tariffs on Canada and Mexico. Remember, we’ve got a 25 percent tariff on Canada and Mexico, and, again, 20 percent more on China as a result of IEEPA tariffs, subject to this so-called fentanyl crisis—this emergency on fentanyl. So all of those tariffs, which pretty much means everything except the existing tariffs on steel and aluminum and cars, are subject to this IEEPA challenge. And it is a big challenge. Two courts have already ruled that the president’s tariffs under IEEPA are illegal, unlawful. Why? Because, again, the Congress is given the power by the Constitution to impose tariffs. Again, Article One Section Eight of the Constitution is very clear. It is the Congress and the Congress alone that has the power to impose tariffs. So the president can only impose tariffs if the Congress has handed over authority from the Congress to the president. And so the question before the courts is, did the Congress hand over this authority in this IEEPA statute? And the courts have found, and many are arguing, that the answer to that question is no. Again, partly because, again, it has to—the words that the president is relying on is that IEEPA gives the president the power to regulate importation and exportation. And so then the question becomes, does “regulate importation or exportation” mean tariff? And the argument is, no, it does not, because in every other law in which the Congress delegates that power to impose a tariff, it uses the word “duty” or “tariff.” And it puts in procedural requirements. It puts in timing requirements. It puts in notice and comment requirements. It puts in limits on the amount of the tariffs that can be imposed. None of those exist in IEEPA. So, again, there’s a big challenge as to whether or not IEEPA provides the president with tariff authority at all. And, again, at least one court has already ruled to say, no, it doesn’t. And then the second aspect of IEEPA is you can only impose these tariffs if you have declared there to be a national emergency, which is—which, again, is defined in the law as an unusual and extraordinary event having its genesis outside of the United States. So the second big argument to all of these reciprocal tariffs is how can you say that a trade deficit is an unusual and extraordinary event when the United States has been running a trade deficit every single year for fifty consecutive years? The deficit is not particularly high compared to our GDP, you know, in this year. So how is this an unusual and extraordinary threat if it’s something that’s been happening for fifty years? And similarly, the argument on the fentanyl tariffs is, you know, what is putting a tariff on, you know, teddy bears, or T-shirts, or anything, else have to do with fentanyl? There has to be a connection between the emergency that’s been declared and the action that’s been taken, tariffs. So across all of those fronts, there are these very serious challenges pending to the tariffs. These challenges are currently pending before two different appeals courts, again, because the courts have already ruled, no, you can’t use IEEPA for tariffs. The appeals are pending. I’m assuming that by early fall we will have decisions by these appeals courts as to whether or not they believe that IEEPA provides tariffs authority or not. And then presumably, from there going, you know, again to the Supreme Court, I would assume sometime, you know, again, in the winter we will have some court—sort of a ruling from the United States Supreme Court. CVETKOVA: Thank you. I want to go back to the trade deals. I want to make sure that we talk about the U.S.—potential U.S.-China trade deal. And Inu, I want to turn to you and ask you, if there is a U.S.-China trade deal—I mean, I do remember the first Trump administration the Phase One and Phase Two agreements, and what happened with that. If reached, this U.S.-China trade deal, what shape or form do you think it is going to take? Or are we just going to see a prolonged trade conflict instead of the trade deal? MANAK: Thank you, Dima. You know, I think it’s going to be very difficult to do something very comprehensive with China, because comprehensive deals take time. And it takes a principled approach with really clear targets that you’re trying to achieve. And the administration’s trade policy has basically been erratic. It’s been erratic because they’ve been trying to get quick deals, but a quick deal with China won’t bring about the systemic change that’s needed to address some of the concerns that were brought up in the original Section 301 report on unfair trade practices with China under the first Trump administration. Now, if we look at what happened during the first Trump administration, we had the Phase One deal on January 15, 2020, signed. It included various commitments, mainly focused on purchase commitments, including agricultural products, industrial products, natural resources, and services. Now, if we look at how that did, Chad Bown from the Peterson Institute found that China actually only purchased 58 percent of the total U.S. goods and services exports over 2020-2021 that it had committed to buy. And it bought none of the additional $200 billion of U.S. exports committed under the deal. So the Phase One deal not only did not live up to the purchase commitments, but it also failed to systemically change some of the concerns he had about China in terms of unfair trade practices, including whether or not it was violating IP rights and it was using forced technology transfer. All these things were left unaddressed. Now, if we are to deal with that, one of the things we need to be doing is to work with our trading partners, who we’re now raising tariffs against, to find a way to actually work together to have common rules around how we deal with China. And at the moment, what we’re doing is actually pushing a lot of our trading partners closer to China by closing off our own market and threatening all these tariffs over and over again. So I think that at the end of the day if we actually are to have some significant reforms and a comprehensive deal, we kind of need to step back and take some time, right? We can’t have this general framework that we keep modifying every other month where it comes to no real strong commitments at the end of the day, and we have no dispute settlement mechanism that we can use to enforce it. So China Phase One deal has no dispute settlement mechanism. And if you look at the text of the U.K. deal, I don’t see one there either. And, in fact, it says it’s a nonbinding deal. So how can we actually achieve concrete results if the agreements are nonbinding? So I think there is a big question here about what we can actually achieve and huge limitations in just the structure of the negotiations themselves. CVETKOVA: That’s great. And I and it brings me to the next question, actually. It leads on to, are we actually seeing the U.S. on the way to withdrawing from leadership from the global trading system? And if the three of you can think of five years from now what the trade landscape is going to look like, how do you visit it? Francisco, would you like to start? SANCHEZ: Well, the short answer is, yes. We are retreating from being the global leader in promoting free trade, in being against protectionism, if you will. Going from being against protectionism to being the leader in protectionism, in many ways. You know, hard to predict what’ll happen in five years, but there’s no question that what’s happening here will largely—(off mic, technical difficulties)—the other countries, when they negotiate with some of their trading partners that aren’t the United States. So I do see a retreat from globalism, a retreat from free trade. And time will only tell how far we go. I’m very concerned that probably our biggest economic adversary—not probably—our biggest economic adversary is China. And yet, of the fourteen countries that were mentioned yesterday, many of them are in Asia where we should be strengthening those ties and not creating tensions. I’m talking about Japan, South Korea, Thailand, Malaysia, Indonesia, Cambodia. So it creates tension where we should be creating cooperation to go after the most challenging economic problems we have, which I believe is China. Inu mentioned intellectual property, theft, forced transfer of technology. Those are the issues we need to be focusing on. And they’re hard. So I don’t believe on critical issues we’ll see those be resolved soon. To the extent we have a deal with China before the end of the year, I believe there’ll be, perhaps at best, some short-term advantages, but not long-term. HILLMAN: For what it’s worth, I’d only add that, you know what you—a couple of things. One is, you know, there is a huge risk to the whole world if we, in essence, fragment the global trading system into two big blocs—a kind of, you know, pro-U.S. bloc and a pro-China bloc. The WTO and the IMF and the World Bank, you know, recently published a study that said if we just do that—just that fragmentation alone, with no other changes happening in the rest of the economy, we’re looking at a 7 percent reduction in global GDP, and even more of a reduction for many of the developing and least-developed countries. So, again, a huge risk of fragmentation. And the other thing to watch China doing in response—you know, again, you have to be really clear about what did China do the last time the United States engaged in this trade war, is to some degree the same thing they’re doing right now. Which is, to the extent that they raised tariffs on U.S. products they lowered them on goods from everywhere else. China is immediately sort of doubling down and going to all of its Asian neighbors and saying, you know, we are a reliable trading partner. The United States is not. You should do more of your trade, you know, in and around and with the United—with China. China is trying to become, itself, much more, again, the hub of all of this trade, you know, within Asia. So I do think we need to be really worried about it. You know, and as Francisco said, I mean, many, countries share our concerns over what China is doing on intellectual property theft, on over producing, overcapacity, flooding the rest of the world with all of this excess capacity in goods that’s driving down prices for everybody in the world. A lot of countries share that. But they cannot get on board with the United States in fighting it if the United States is going to turn around and put tariffs on them. And, again, the tariffs come on and off and on and off. So, you know, that I think is the real risk, is that we’re going to fragment the world and we’re going to put countries in this very tough position about whether or not they want to side with China or whether they want to side with the United States. They don’t want to side. They want to trade with everybody. And yet, you know, we may be pushing them to have to make a decision. SANCHEZ: And, Dima, if I may add one more thing, is that the tough approach, or the no carrots a lot of sticks approach doesn’t work well when your counterparty has its own set of tools to fight back with. One that the Chinese have used, I think very effectively, is holding back export licenses on rare earths, something that’s very important to a lot of American industries. So it isn’t as though China doesn’t hold any cards. They hold quite a few. I would also point out that China is prepared to have its population be ready for economic difficulties, rather than to just simply cave in to something that President Trump may want. So I think no matter how you look at it, the negotiation with China on issues of real importance to us are going to be very, very difficult and probably a long time in coming. CVETKOVA: Thank you, Francisco. And, Inu, before I turn to you with the same question, I just want to mention for the audience that we’ll be opening the Q&A session in just a moment. So if you do have a question, please raise your hand now to join the queue. So, Inu, over to you. MANAK: All right. Thank you. You know, just to add one big picture point to that. When I’m looking at sort of U.S. engagement and global trade leadership, I would say we haven’t been a leader in the global trading system for eight years. And we never kind of stepped back into the role of leadership once we stepped out of it in the first Trump administration. You know, when Trump first entered office, he effectively ignored the global trade rules. And then Biden came in. And he largely followed suit. Most of what Trump did in his first term was maintained in the Biden years. There was a window of opportunity early on in the Biden administration to reverse course, but the prevailing view in the administration was in support of greater protectionism. And they kept betting on protectionism and to keep it in place to avoid losing support among working-class voters, who, in the end, voted them out anyways. So I think that strategy did not work. And it showed to be something that actually was not something that folks were responding to. And here, Trump’s come back and said, well, you kept these in place, obviously they’re popular, and so let’s just ratchet them up. And so what we’re seeing today is taking that tariff policy to even greater extremes. And we don’t really have any counterweight to that anymore. And so I think there’s a bit of a scramble internally within the United States to see, like, where Democrats stand on these issues today. And there’s a lot of soul searching going on to figure out where they do stand on it. So I think we’re going to see a lot of that play out in the next couple of years, as we have members of Congress respond to the pain that their constituents are surely going to feel as some of these tariffs actually take effect. And I think what we’re starting to see, in fact, in looking forward in the next couple of years, is the fact if maintain these tariffs and, as Jennifer said, you have additional tariffs coming on 232—if you pile on tariff after tariff, the U.S. is going to become an increasingly closed market. And when 50 percent of what we import are intermediate products, that means those who are going to be hit most are going to be small and mid-sized businesses. And they are going to suffer. We’re going to have less consumption and less growth. We already have low growth projections. And we’re going to see that other countries are going to look elsewhere for arrangements in which to trade. The CPTPP, which the U.S. withdrew from, is becoming one of those frameworks, and others may try to bolster the WTO and other arrangements in order to find ways to trade on a rules-based way. The EU has said that they want to do that. So we’ll see more diversification from our trading partners, less coming here. And it’s going to make the United States a less safe bet for investments over time if we have a really unstable trade landscape. So a lot of uncertainty. It’s hard to see where it’s going to land. CVETKOVA: Thank you, Inu. And, actually, mentioning the WTO, Jennifer, I’ll turn over to you, with your experience and your background. What are the urgent—what are the urgent things we need to—the WTO needs to change in a certain way? What are the urgent changes that have to be made, when it comes to the WTO? HILLMAN: Well, obviously, you know, the big concern at the WTO is here you have, you know, arguably, the two largest trading partners in the world—China and the United States—basically engaging in, effectively, a trade war outside the bounds of the WTO, which, again, doesn’t suggest the—you know, that the WTO is playing this highly relevant role. You know, again, because every single one of these tariffs—whether they’re under 232 or under IEEPA—are a violation of the United States’ commitments under the WTO. I mean, we promised when we joined the WTO, again, and when we helped create the WTO, that we would not charge tariffs in excess of the rates that we bound our tariffs at, and that we would not charge tariffs that differentiated between this country versus that country. We would not discriminate with respect to our tariffs. And, obviously, all of these tariffs are discriminatory. So, again, most of the other countries look at the United States and basically say, it’s the United States that is the major problem at the WTO, not China. That it’s the United States that’s not playing by the rules, not China. And, again, that is not in our long-term interest. So what does the WTO need to do? I mean, to me, I think, A, the WTO has got to do everything that it can to try to urge all of the other countries in the world to maintain their tariff commitments. And if they must retaliate against the United States, or must do things on the tariff front, to try to stay within those rules of what are their bound rates, what are their MFN commitments, to try to adhere as closely as they can to the rules. The second one is obviously the dispute settlement system. The United States has, again, destroyed the dispute settlement system by blocking any appointments to the appellate body. A number of countries have come up with this alternative, what is referred to as a Multi-Party Interim Arrangement on Arbitration for Appeals, MPIA. Again, every country has the option of joining that MPIA. And, again, using the rules of the WTO to try to stay as close as possible to a rules-based system. And, obviously, the WTO has got to do a lot of changing on its own. It’s clear that over the life of the WTO it has become way too hard for the WTO to update its rule book. Again, it lives under a rule called consensus where, again, nothing gets agreed upon unless everybody agrees. And it’s become just way too easy for countries to just raise a flag and block a consensus. So the WTO has got to engage in a lot of thinking about how to make decisions better, how to end up with agreements that at least the majority of or a clear plurilateral group of countries can support, so the rest of the world can move ahead even if there are some countries that are not ready to move ahead. They’ve got to update the way in which they go about rule making. And, to me, they’ve got to keep doing and do more of what they do do well, which is to provide, you know, again, a forum for everybody to talk. And, more importantly, transparency. Again, you know, you can go—you can find out everybody’s tariff rates, sanitary measures, phytosanitary measures, technical barriers to trade. They’re all notified to the WTO. So they are—the WTO is a tremendous resource for countries. And, again, they need to do all of that, and to continue to do it well, while they are figuring out how to fix their dispute settlement system and how to fix the sort of negotiating arm of the WTO. CVETKOVA: Thank you, Jennifer. And I want to turn to Francisco with a different question. You’ve helped companies navigate this very difficult trade landscape. We laid it out there. We talked in the past a lot, and you continue to talk about supply chain resilience. So how are companies actually navigating this space? SANCHEZ: A lot of them very difficultly. When you establish supply chains it takes time. And particularly when you’re doing supply chain resiliency, you’re trying to find multiple supply chains to make sure you have backups. But this is—this isn’t something that you turn on a dime. And so it’s very disruptive. It’s something that’s on every company’s mind that relies particularly on international supply chains, and very challenging. I might add, this is not exactly on point to your question, but going back to one of the original purposes of this trade strategy is to attract manufacturing back to the United States. Japan currently is our number-one—or, number one or number two depending on what source you look at, source of foreign direct investment. And 41 percent of that foreign direct investment goes into manufacturing. This is kind of hard to understand. If that’s our goal, it seems like one of our important trading partners that we’ve just slapped—or threatened to slap 25 percent tariffs if we don’t reach a deal by August one, how that is a great motivator to somebody who seems to be doing what they want. And to answer—going back to your question, that foreign direct investment will be harder for companies to make the decision to invest here if their supply chains are harder to put together, whether it’s an American company or whether it’s this foreign direct investment that’s coming from Japan and other countries. So I’d say it’s been a big challenge. And because of the economic uncertainty that we’re seeing in the execution of this trade policy, I believe that that difficulty is going to remain for some time. CVETKOVA: Thank you, Francisco. And at this stage, I can see that we have a question from the audience. I want to turn to this question. Let me just remind the audience that this meeting is on the record. Alexis, can we have the question please? OPERATOR: (Gives queuing instructions.) We will take the first question from Mara Lee. Q: Hi. This is Mara Lee. I’m a reporter with International Trade Today. And if you will forgive me, I’m going to squeeze in two questions. One question is about this question of transshipment in the Vietnam framework. Robert Lighthizer has talked about transshipment in a way that doesn’t mean transshipment, that just means a certain amount of Chinese content in a good. And so I wanted to get y’all’s thoughts about how—what the U.S. might get other countries to agree to in terms of will it be more like a rule of origin, that if you have, you know, 60 percent of the value is Chinese it doesn’t count? My other question is sort of this game of chicken, in the sense that Japan and South Korea really don’t seem to be able to accept a world that the 25 percent auto tariffs don’t go away. And we don’t seem to be willing to have them go away. So will Trump have to back down in the end because the market will discipline him? Someone said there isn’t any more guardrails, but he did back down in April because of a huge stock market drop. You know, the market’s not going to care about 40 percent on Cambodia or 25 percent on Kazakhstan, but they may care about 25 percent on some of our very largest sources of imports. HILLMAN: So I can—I can start first with the transshipment question. Just to say, unfortunately, we don’t know. I mean, what the agreement—what little we know says that the tariffs on everything from Vietnam is 20 percent, unless it has been transshipped in which case it’s 40 percent. Now, again, normally transshipment is considered something illegal if you basically are, in essence, slapping a label on something that says “made in Vietnam” when it was, in fact, made in somewhere else. I mean, that is normally what we think of as transshipment. And so obviously if that’s what you’re doing, you know, that is illegal, and, you know, it should carry a higher tariff. But if what they really mean is that you’re simply using components from everyone else, that is not what we normally understand transshipment to be. I mean, normally we live with—again, the 20 percent tariff on Vietnam ought to be on anything that is considered made in Vietnam. How do we know if it’s made in Vietnam? It’s whether it meets the existing today rules of origin that apply to Vietnam, and many other countries. And that rule is generally wherever it—wherever that article is last substantially transformed into a new and different article of commerce, or underwent, you know, a tariff shift where it becomes a new item under the tariff schedule. If that work occurred in Vietnam, that good should be considered made in Vietnam for purposes of customs, and should be subject to the 20 percent tariffs. So we simply don’t know whether they’re going to come up with some kind of a different definition of what is meant by transshipment in this. And the only other thing I will say is those kind of negotiations, over rules of origin and changing rules of origin to require more work to be done in Vietnam in order to qualify for that 20 percent tariff, are not easy to negotiate. Because the way in which every different product is made is different, and therefore you have to really struggle to figure out how are you defining the rules of origin within any given product? I mean, you saw this really clearly in the auto rules of origin with respect to the USMCA, the U.S., Mexico, Canada agreement, where that was a large negotiation to try to just figure out how to change those rules of origin, adding in requirements on where the steel was melted and poured, and a lot of other things. So the answer is—on the transshipment—I think we really don’t know what they mean or what they’re getting at by that, and won’t until we see actual terms of an agreement. SANCHEZ: Well, I’ll take a shot at the second question. I’m not terribly good at making predictions. In fact, I’ve made predictions that have been wrong in the past. But I’m going to take a shot at it. I don’t believe that the 25 percent tariff that President Trump announced will stick with Japan and South Korea, in part precisely because of what your question implies, is the increased cost to the American consumer would be substantial. I think it is—as we mentioned at the beginning of this program, one of President Trump’s goals is to get leverage in negotiations. And I do believe that that number is more about leverage than locking into that tariff rate. CVETKOVA: Thank you very much. Do we have—do we have other questions at the moment? OPERATOR: No other questions at the moment. CVETKOVA: No further questions at the moment. So I have another question for the panelists. And I sort of want to know, when you think about the U.S. trade policy is there an aspect of it, at least one thing you can mention, that has been either overlooked or, on the flip side, anything that has been overemphasized? And why? Inu, would you like to chime in? MANAK: Yeah. No, thank you. I mean, I think the thing that’s often being overlooked is the fact that we need imports in order to do the things that we do here. You know, if you have to have a vibrant manufacturing base, we need to import components. And so I think what the administration is focusing on is really just not going to be achieved. You know, they say they want to increase manufacturing and exports. Well, you can’t do that without imports, right? And so I think this is one side of it that we need to talk a little bit more about to understand the tradeoffs of imposing tariffs in all these various sectors, right? Because, as Francisco mentioned early on, you know, if you impose a tariff, say, maybe you’re going to show some sort of increase in manufacturing output, maybe in some protected sectors, right? But you’re going to lose it elsewhere. And so we have to have a broader conversation about where is it that we think we should be investing all this trade protection? And is it worth it in the end for the job losses and the reduced output we’re going to create in other sectors? And so I think that’s a broader conversation that’s not being had right now. We’re focusing so much on manufacturing, when manufacturing has been doing quite well. We have tremendous amounts of manufacturing productivity output. We have a good amount of employment in our manufacturing industry. We could do more. We could have more automation, which we’re actually quite behind in compared to other countries. If you look at the number of robots that China has in its manufacturing facilities compared to us, we are really, really low in that number. So we need to do more here in investments. But it’s not tariffs that’s going to get us to that point. And so we have to have that question of, like, what is the goal here, and how do we actually go ahead and achieve it? And how do we do it where we’re basically strangling ourselves by limiting our options for what we can actually purchase abroad? SANCHEZ: Dima, I think another premise of President Trump’s trade policy that needs to be scrutinized is the definition of America being unfairly treated. Trade deficits have been used to define whether there’s unfair treatment between the United States and a particular country. But, as Inu pointed out, one of the reasons that we import things is to make things, right? Our supply chains are international, and we need—we need products from across the board. Another reason that we import things is because we’re the wealthiest country in the world. And so defining an unfair trade relationship just based on the deficit, it just—it doesn’t make sense. There may be unfairness going on, but to measure it based on our trade deficit seems, to me, like a poor measure. HILLMAN: I’d only add two additional ones, in terms of what are we missing? I mean, obviously, to me—and it was sort of implicit in some of what Inu was saying—is, you know, manufacturing of goods is about eight or 9 percent of the GDP of the United States, if you don’t count agriculture. So what are we missing? We’re missing the ninety percent rest of the U.S. economy, which is largely in services. And this is where the United States, again, has a trade advantage. This is where we really do have, you know, the ability to outcompete a lot of other countries. And all of this time that we’re spending talking about tariffs and talking about manufacturing, as important as that is, means that we are not focused on what do we need to do to remain highly competitive on the services side. And the second piece of it, to me, that we’re really not appreciating, I don’t think, is the cost of chaos and uncertainty. And why has that chaos and uncertainty come into our trading system? And here’s where, again, I do think it goes back to some of the basis for the legal questions, because it used to be that Congress set trade policy. And so for an act to go through Congress, whether it was a free trade agreement, or whether it was trade promotion authority, or whether it was the tariff schedules that were included within the Uruguay Round agreements—once the Congress voted on that trade policy, it stayed that way for a fairly significant amount of time. And, yes, you could add tariffs as a result of anti-dumping, countervailing duty, safeguards, you know, other actions. But fundamentally, there wasn’t these huge pendulum swings. And now that we’re deciding to make all tariff action and trade policy by the executive branch, again, you’re seeing this big swing away from where—you know, again, away from a stable trade policy, in a way that I think is really hard not just for our trading partners, but for everybody in the supply chain to deal with the fact that they literally do not know what the tariffs are. They don’t know when they’re going to be applied. And that they could change at a moment’s notice for any reason. And that they’re not—they’re not related to something that you can at least predict what’s going to happen. There’s no predicting here. And I think we’re underestimating what a drag on the U.S. economy that level of chaos is creating. CVETKOVA: I would like to end this conversation on a positive note. (Laughs.) So I’m going to ask you a final question before I conclude the meeting. Is there any positive outcome that you believe could come out of this trade policy and trade negotiations? HILLMAN: I’m going to go first, only because, I’m sorry, that I do have to leave a little bit early. So I apologize to my fellow panelists that this is—you know, I’ve got to walk out the door. For me, the positive that could really come from this is if we’re starting to have really, you know, again, helpful conversations with our trading partners about many of the things that that Inu mentioned at the beginning are part of, potentially, the U.K. negotiation. You know, again, things like cooperation on non-tariff barriers, digital trade provisions, cooperation on economic security and, again, maybe cooperation on what to do broadly about China. If these negotiations do that, and we don’t take this only attitude of we have to win and you have to lose in order for it to be a good trade negotiation, if we can focus on those other things, then, to me, particularly on the digital trade agenda where there are no international rules and we desperately need them—you know, if out of all of this chaos could come a better sense of where we’re headed on digital trade, to me, that would be—that would be a big win, and is not out of the realm of the possible. So I hope that’s leaving you, at least from my end, on a bit of a happy note. CVETKOVA: Thank you very much, Jennifer. Thank you. (Laughs.) Inu, digital trade. I hear—(laughs)—would you like to chime in? (Laughs.) MANAK: Yeah, absolutely. Now, I think there is a real opportunity, actually. So there is all this leverage that’s been created from the tariffs that have been put in place. Countries want to negotiate with the United States. So we should use that enthusiasm to actually get something done, right? You know, forget the deadline. And deadlines don’t really matter. I think that’s been pretty clear this year, that the deadlines can move. And that’s OK. Trade negotiations take a long time. And we should take the time to do it right. And on digital trade is something where the United States has long been a champion of creating global rules, but we dropped the ball on that a couple of years ago. And now is our chance to make sure that we can have global rules on digital trade that reflect U.S. interest. There have been negotiations ongoing at the World Trade Organization for several years. Last year, they got very far along, to the point where they actually have what’s called a stabilized text. That just means there’s lots of stuff that’s pretty much agreed to, and there’s a few things that aren’t agreed. I think for the United States, it would make a lot of sense to go into those negotiations and say, hey, look, maybe we need to change some things here, and expand a little bit what we’re doing, and include some provisions in there that are a little bit more stringent for China, in particular, to address some of the concerns over data localization, for instance, that have been a major sticking point in negotiation. So I think there’s a real opportunity for that. But also just generally, on the WTO reform front, we could do a lot. We can address the problem of developing country status in the WTO, which is self-declared. You are a developing country if you say you are. That’s something that’s been a major sticking point for a very long time. We could address the unfairness of subsidies and overcapacity by having a broader conversation about that. And if we don’t do it there, we can do it within a smaller grouping of countries that are actually also concerned about it. We had discussions under Robert Lighthizer between the EU, Japan, and the United States on overcapacity and subsidies reform. We should rebuild those discussions again and try to find a way to have some common ground there, because if we work together and we leverage our allies to make sure we can actually get these changes, I think there’s a real chance that we can have some positive structural reform at the end of all of this. CVETKOVA: Thank you. And Francisco. SANCHEZ: I’m probably in very strong agreement with the comments that Inu made and Jennifer made. I do believe there’s an opportunity here to focus on non-tariff barriers, which are often more problematic than the tariffs themselves. Anytime you start a conversation there’s hope. There’s hope that you can have something good happen. And I think in the non-tariff barrier space we could see some movement. And that would be a very positive thing. Jennifer mentioned more cooperation among the countries that are concerned about China as an economic threat, particularly in some of the unfair practices that they engage in. And, again, just starting the conversation with countries, even though these conversations have been testy in many cases, could lead to cooperation to something that really is going to be critical for our future. And then finally, not so much on the trade front but geopolitically, it’s possible that we begin to get closer to India, for example, which is going to be an important country for the United States to build a relationship with, not just economically, but geopolitically. And the same in the Asia region. Although we’ve had very difficult, it seems, conversations with Japan and Korea and others, geopolitically it’s in our interest to be closer and to work together. And I’m hoping, from this chaotic beginning, we can see an improved relationship that that that goes to our geopolitical interests as well. CVETKOVA: Thank you very much. With that, I would like to conclude the meeting by thanking the speakers for a very lively and engaging discussion, the audience for joining us, and the Council on Foreign Relations for organizing this event. Thank you. SANCHEZ: Thank you. MANAK: Thank you. (END)

Thomas J. Bollyky, the Bloomberg chair in global health, senior fellow for international economics, law, and development, and director of the global health program at CFR, discusses emerging threats …

CFR experts discuss the U.S. strikes on three of Iran's key nuclear sites, Iran's possible response, and implications for the region.   

Deputy Secretary of the Treasury Michael Faulkender addresses the current state of the U.S. economy and outlines the administration’s upcoming economic priorities This meeting is presented by RealEcon: Reimagining American Economic Leadership, a CFR initiative of the Maurice R. Greenberg Center for Geoeconomic Studies. If you wish to attend virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.

Global health and security will increasingly rely on the support of private sector actors, multilateral development banks, and local scientists, institutions, and entrepreneurs. While these local actors are already addressing domestic health needs, strengthening their role in global priorities such as disease surveillance and the rapid distribution of medical countermeasures requires rethinking what is best led locally, establishing supportive financing structures, and reforming global institutions to enable meaningful collaboration within a broader global framework.   This roundtable will explore these critical topics, featuring two speakers who will offer diverse perspectives on the challenges and opportunities ahead: Peter Singer, emeritus professor of medicine at University of Toronto, former special advisor to the director general of the World Health Organization, and former CEO of Grand Challenges Canada and John Simon, founding partner of Total Impact Capital, former U.S. ambassador to the African Union, and former executive vice president of the U.S. Overseas Private Investment Corporation (OPIC).

Ilia Delio, founder of the Center for Christogenesis and a Franciscan sister of Washington, DC, and Noreen Herzfeld, the Nicholas and Bernice Reuter professor of science and religion at the College of Saint Benedict and Saint John's University, discuss how religious worldviews and spiritual traditions can inform global AI policy and explore the role of faith leaders in shaping inclusive, ethical, and internationally responsible governance of artificial intelligence. 

Panelists discuss what to expect from the upcoming NATO Summit at The Hague amid an uncertain geopolitical and political environment. For those attending virtually, log-in information and instructions on how to participate during the question and answer portion will be provided the evening before the event to those who register. Please note the audio, video, and transcript of this hybrid meeting will be posted on the CFR website.

CFR experts discuss Israel's strikes against Iran's nuclear program, Iran's possible response, and further implications for the region, including the potential for war. The video and transcript of this media briefing will be posted on the CFR website. Please join the Zoom event at least five minutes before the start of the presentation by using the below details: Media Briefing: Israel, Iran, and What Comes Next for the Region Zoom Webinar ID: 834 3522 4861 Passcode: 783613

Please join us for a livestreamed discussion on the future of the World Bank and lessons learned from Mr. Banga's distinguished career to open the 2025 National Conference Speaker Ajay Banga President, World Bank Group Presider Michael Froman President, Council on Foreign Relations Introductory Remarks David M. Rubenstein Cofounder and Co-Chairman, The Carlyle Group; Chairman, Board of Directors, Council on Foreign Relations ---- Note that the National Conference specifically convenes CFR members based outside of New York and Washington, DC.   RUBENSTEIN: Wow, we have a great group here. OK. I’m David Rubenstein. And I have the honor and privilege of serving as chairman of the Council on Foreign Relations. And to all of our members, thank you very much for coming. We have—this is our thirtieth National Conference. And that means it was started in 1995. Now, who can remember the most important thing that happened in 1995? The O.J. Simpson trial. (Laughter.) So we’re expecting 460 participants over the course of this—of this conference, from about thirty-six different states and from ten different countries. So to all of you who’ve taken the time to come here, I appreciate your doing it. We think you’re going to learn a lot. We have an incredible group of panelists who’ve agreed to participate. And I think you’ll learn a lot.   And as I was thinking about it just a few moments ago, you know, I lived through, many of you did, the Vietnam War, and lived through the Iraq and the Afghanistan War, when American soldiers were being killed. And it was very nerve wracking to be an American, to be watching this happening. And now we don’t have any soldiers that are really in combat, yet we have conflicts around the world that are extremely dangerous to our country and dangerous to the future of the world. So Russia-Ukraine, Israel-Gaza, what’s going on in Iran, and potentially China and Taiwan.  And so a lot of people ask me all the time: What is going on in your country now? What is your policy going to be? In fact, as I travel around the world I get more questions now of what our foreign policy is than any time in my—ever since I’ve been traveling around the world, for the last thirty-some years, even though we’re not in combat ourselves. And it just, you know, illustrated to me how important it is that we have an informed citizenry that can really know what’s going on. And by participating in this event, I think you’re going to be part of our informed citizenry.  As I think you probably heard me say before, Jefferson used to say—Thomas Jefferson—that a democracy really only works if you have an informed citizenry. Our citizenry is not as informed as it should be, and we’ve spent a lot of time in recent years trying to make sure that the Council on Foreign Relations is educating people who are not only members but people who are interested in learning about foreign policy and national security policy.  When the Council was first set up, it was set up for basically White men from New York City. (Laughter.) Then we dramatically expanded it to White men from Washington, D.C. (Laughter.) And then later we decided we’d have some White men from around the rest of the country. But over the recent years we’ve dramatically changed that, to the good fortune of the Council on Foreign Relations. We have a—I hate to say that I don’t want to use the word; I will use the word—we have a diverse membership, and we’re very proud of having a diverse membership. We now have members from—about one-third of our members from the New York area, one-third from Washington area, and one-third from the rest of the country. And our membership is I think now about 30, 35 percent female, which I think is much better than it used to be. And gender—and ethnic diversity is much, much better than it ever was. And therefore, I want to thank the members of the Council who are here and thank all the people that have been willing to apply to be members of the Council.  As you probably know—you may have heard me say this before—being a member of the Council is, you know, a testament to your achievements, your ability to be a productive citizen. As I said the other night—and I hope you all see this later—two nights ago we unveiled the portrait of Richard Haass—Richard Haass, president for twenty years. We have a tradition here of having portraits of our presidents unveiled, and you’ll see it tonight, I think. It’s an unusual picture, and I won’t comment further on it, but it’s—(laughter)—it’s a great picture and I’m very happy we have it.  But what we really have here now is an opportunity for all of you to learn more about national security, foreign policy. The team has put together an incredible program. Our National Committee, headed by our vice chair, has done a really incredible job, a great work. And I want to thank Blair Effron and all the others who were involved in making this possible.  So, just to conclude, I want to thank Mimi Haas. Is Mimi—is she here? No. Mimi Haas has been a supporter of the National Conference, and she’s supported it significantly in memory of her late husband, Peter. And I want to thank Mimi publicly for making it possible for the National Conference to occur.  So over the course of the next couple days you’re going to learn a lot more about foreign policy, national security policy, and I think you’re going to come away feeling, you know, you’re fairly educated. You may be a little depressed when you hear some of the things that are going on. (Laughter.) We had a board meeting today, and we heard briefings on Russia and Ukraine, no easy answer there; briefings on the Middle East, no easy answer there; tariffs and trade, no easy answer there. And so you’ll hear about all this, but hopefully you’ll come away after these two days are over feeling you are better informed, you feel you’ve gotten your money’s worth out of the Council. And I just want to thank all of you for not only being members of the Council, but for your generous support.  The Council does not get any government money—not that we would probably get any anyway. (Laughter.) But we take no government money. And so now, you know, we depend on the generosity of our members and other people like Mimi who have been supportive. So thank you all for coming. Thank you for being here this evening.  And let me just introduce what we’re going to have now, which is tonight we’re going to have a panel discussion between Ajay Banga, who is a(n) incredible individual who’s now the president of the World Bank. Previously, he was the head of Mastercard, among other major positions he’s had in the financial service world. An immigrant to the United States and an example of the kind of strength we get from the United States—in the United States when we have immigrants, and many of the people who are here probably are immigrants or know of immigrants who’ve helped our country a great deal. Ajay is an incredible success story, has risen up to be the head of the World Bank, one of the most important jobs in the world, really. And he’s going to have a conversation with Mike Froman. Mike, as you know, has done an incredible job in just the relatively short period of time, a little more than a year or so, as the president of the Council on Foreign Relations. And so you’re in for a treat. And I want to ask them both if they would come out now, Mike Froman and Ajay Banga. (Applause.)  FROMAN: Terrific. Thank you, David. Welcome, Ajay. It’s great to have you.  BANGA: Thank you.  FROMAN: Ajay was here in September 2023, about six months—four months since you’re—  BANGA: When you were twenty-seven years old.   FROMAN: Yes, exactly. Exactly. (Laughter.) So it’s great to—it’s great to have you back. You know, you’ve said the World Bank was not born of altruism but of strategic design. You know, many think of the World Bank as a humanitarian organization. It’s not. But poverty alleviation has really been at the core of what it’s done for so many years. Over the years, there’s been a focus on education, on health, on infrastructure, on climate. You’ve put jobs as the North Star, the creation of jobs at the North Star, not as a byproduct of other investments but as a goal in itself. Why jobs? Why do you think the World Bank can create jobs around the world? And why the shift in emphasis?  BANGA: So I think the reality is that the best way to alleviate poverty or eliminate it is to create jobs. The best way to put a nail in the coffin of poverty is to give a person a job. Because poverty is both a state of mind and a state of being. And a job alleviates both. You earn, but you also have hope and optimism. And if you don’t have those two things, you remain in one form of poverty or the other. And if you look at the history of the last forty years of poverty alleviation in the world, most of it has happened in countries where jobs were created in the tens of millions—China, India, Mexico, Bangladesh, Vietnam. All mostly by outsourcing jobs and production from the developed world to these countries, principally for labor cost arbitrage reasons, to start with, but then followed up by logistics cost arbitrage because they were building infrastructure from scratch and did a much better job of people building that than we would have had to do if we had to rebuild it. And they made good quality products as well.   When you put those three things together, you ended up with this model of growth, job centered. There’s 1.2 billion young people coming through the pipe in the emerging markets who will be ready for a job between now and the next twelve to fifteen years. Current forecasts for those countries, same countries, is to create somewhere around 400 million jobs. Now, forecasts are made by guys like us, and so don’t take it too seriously. And forecasts are not destiny. But we can’t be wrong by 800 million. Something is missing in that space. And if we are wrong by 800 million, then what you have is not a demographic dividend. You have a timebomb ticking in the next twelve to fifteen years. Because then—if you’re worried about illegal migration right now, just wait. If you’re worried about military coups right now, just wait. If you’re worried about drugs and people not being able to get access to being productively involved in society, just wait. You’re saying you can’t hear me, ma’am? All right.  FROMAN: Yeah, can we turn up the volume, please? Thank you.  BANGA: So, I mean, at the end of the day the point is you got all these people looking for a job. You’ve got not enough jobs. You’ve got challenges on that front. I think building a school and building a bridge and building a skilling center is lovely. But if all—if it isn’t all focused towards job creation, then it isn’t going to do what it needs to do. And that’s why the focus on poverty, and jobs, and connecting the dots. And that’s what I’m up to.  FROMAN: And, ultimately, what’s—is that better? I can hear myself better now. What is the role of the private sector in that job creation? This is all going to come from government jobs and assistance?  BANGA: I hope not. I hope not. That’s how our tax dollar goes to die. But if you—if you were to—(laughter)—if you were to think about how jobs get created, you need an enabling infrastructure environment. Meaning—by infrastructure, I don’t mean only hard infrastructure. I mean soft as well—so bridges, roads, airports, all that stuff. But then you need skilling, education, health care, that, if you get that right, and you get the right business-friendly regulatory environment—by business friendly, again, I don’t mean only business friendly as in roll out the carpet each time, but labor law, land law, mobile collateral guarantee law, utilities that are properly funded, things of that nature—if you do those two things, you can then allow a private sector, small, medium, large, global, local, to flourish and create the virtuous cycle you need to create jobs.   So that’s the role of the private sector. Ninety percent of jobs in most countries are created in small and medium enterprises in the private sector. But the government has the role to play of creating the enabling infrastructure and the environment to enable that private sector to win. And that’s the—that’s what we’re trying to do. The World Bank has in its units the ability, through the parts that work at the public sector, to help with the infrastructure. The part that is focused on knowledge and the knowledge bank to help with the regulatory environment and the business-friendly part of it. And the part of us that works with the private sector—IFC, MIGA, ICSID, to help with the private sector.   The question is, can we connect the dots and do it properly? Which is what I said the first time I met you, that I wanted to fix the plumbing of the World Bank. And the plumbing is if you build a house on top of bad plumbing, you end up in trouble. And I’m trying to make sure that the place works as it should, so that this idea of a change then is something we can translate into action.   FROMAN: Where are you in that journey towards fixing the plumbing?  BANGA: (Laughs.) I’d say reasonably well along. Depends how you measure it. But in—the G-20 sort of expert group had twenty-something things to be done. We’ve done sixteen of them. I don’t count that because I’m not sure all the twenty are the only things we have to do. So the way I look at it is, what are we trying to do differently? Become faster. We used to take nineteen months, on the average, for a project to go from conversation to approval at the board. We’re down to twelve now. So what I said I would do by June. Some projects are getting approved in thirty days, a health-care clinic in Kenya. Some projects are taking three years, a hydroelectric dam in Central Asia. That’s appropriate because the risks are different, the challenges are different. And so I think you put it together, you get the twelve months. But you’re getting it done the right way.   The second is that we said we’d work better with the other multilateral development banks, because we all need to work better otherwise we’re fragmenting our efforts. So to give you an example, we’ve got a digital platform we launched in which now every MDB that gets a project in a country puts it in there, and everyone can co-finance and co-bid together. And we’ve now got 174 projects going through it. Fifteen billion (dollars) of financing has already happened in the past six months. We’ve signed a full mutual reliance framework with the Asian Development Bank so if you’re co-financing a project in Fiji, the government of Fiji doesn’t have to go through two due diligences, two procurement systems, two project approvals. One gets done. I do it, they’ll accept it. They do it, I’ll accept it. That’s kind of trying to find a way to make us work better together.   Working with the private sector—you know, you started talking with the private sector, but there’s a whole series of things we’re doing across five dimensions from regulatory certainty, to insurance guarantees, to foreign exchange and local currency, to us taking the first loss, to creating a originate-to-distribute platform that’s run by Doug Peterson, actually, and out of that—  FROMAN: Hmm, CFR member.  BANGA: Yes. Is that so?   FROMAN: Yes.  BANGA: You do manage to rope them all in, don’t you?  FROMAN: We try. (Laughter.)  BANGA: People like me, too, but what the hell.  FROMAN: Mmm hmm, CFR member.  BANGA: I’m giving more than pennies, I’ll remind you, Mr. Rubenstein. (Laughter.)   And so there’s work with the private sector. There’s work on all of these dimensions. There’s a corporate scorecard that had 153 items on it. We’re down to twenty-two. So you could actually be counted for what you’re supposed to be, you know, standing up for. It’s just a whole series of things, Mike, on that front that are happening. Forty countries, combined country management across the bank, the rest underway. We’re trying to get ourselves to be capable of being called good plumbers.   FROMAN: Good plumbers, excellent.  One of the areas you’ve put a major focus on is expanding access to electricity, the M300—to have 300 million more people in Africa or across developing countries getting access to electricity?   BANGA: Africa.   FROMAN: Africa. And this has been a big week for you and energy policy and electricity policy. The board of the World Bank approved for the first time allowing the bank to get involved in nuclear power. Tell us about that and why it’s significant.   BANGA: So the board—not approved for the first time. We had not been financing nuclear for the past forty years. What we got to was a good understanding and agreement that we would get back into that space and do it sensibly. So the first thing I see ourselves doing is signing a partnership with the IAEA so that their capabilities and our current and new—when we build them up—capabilities, will get married together so we can work together.   So Rafael Grossi and I are in the process of working out a way to work together so that we can bring his knowledge and safety and regulatory policy and safeguards to what we think we can build up as well.  The second is to start working on looking at extending the fleet life of current fleet, so that about eighteen, twenty countries around the world that do have current nuclear power—and a number of them will be in the emerging markets as well, which is where our effort is. We won’t be doing work in France or the U.S., but Brazil, and Romania, and India, and anybody else who could need it. And clearly, the economics of extending the life of these nuclear power projects is now far more preferential to building a new one.   Then there’s work we could do on getting new countries who want to go into it to understand the regulatory policy, the safety, the disposal of waste management, the various things you will need in addition to the nonproliferation aspects of it with the IAEA—work on that.  And the last one is small modular reactors who—there’s a lot been talked about it for a long time, and it’s one of those technologies that everybody is trying to find a way to get it to scale. The problem is there’s not standardization yet across the different variants, and therefore, if we can help to help bring about standardization and scale in SMRs, could SMRs be the way of the future for a number of countries—or, for that matter, for high-intensity consumption data centers for AI and the like? So all this has to do with nuclear.   We also got clear sort of insight for our clients and our employees of the World Bank’s intention to continue being active in midstream and downstream natural gas—gas being a good transition fuel with the challenge that you’ve got to make sure you manage the flaring and the methane leaks in gas, which we are working very hard on as well. But the idea is to get natural gas to be used in a number of countries where it makes sense as part of your energy mix, where it’s cheaper. It’s important to have it—particularly if you have it in your soil and you’re not relying on building imported systems for gas, but it’s there, so can I help you develop and do things with it.   The whole idea of M300, which is connecting 300 million people in Africa to electricity, is based on the following fact: 600 million people in Africa have zero power today, zero electricity. These are not brownouts or blackouts. This is nothing, no connection. And I think that electricity is a basic human right. I really think you should call it that, because without electricity you cannot begin to think in terms of health care, education, jobs. You know, I’ve heard people say, let’s use the power of digitization to change the future of Africa. I’m like, guys, what digitization are you talking about, when half of Africa doesn’t have power?   FROMAN: Doesn’t have electricity.  BANGA: What are you going to do—your finger, you going to charge your phone? You know, that big Michelangelo kind of thing. (Laughter.) It doesn’t work like that. Life doesn’t—so you’ve got to get the basics right to get it to work well. And I think that getting power, getting electricity to people is just a starting point. And I don’t mean two lights and a fan. That to me is inadequate. I’m talking about enough power so a household and a business can do what is needed to be done to be a productive participant in society.   And that’s where we came up with the idea of along with the African Development Bank—I have no idea if we’ll get there, Mike. We—in the last ten years we’ve reached 100 million people to connect them to electricity. This is five years, 300 million. It’s hard. But we’re applying all the learnings we have around getting regulatory policy clarity. We have twenty-odd countries that have committed. Presidents, prime ministers, energy ministers have stood up in big halls and committed to the regulatory policy they will change in return for attracting us and the private sector to come there. We have told them we will give them budgetary support when they change the policy, what we call pay for results.  In the last two years, pay for results has become 50-odd percent of our financing. So I pay when you change; I don’t give you the money in advance. And we’re trying to use every tool in the toolkit, every arrow in the quiver to drive this change in policy. You know, you’ve got to get utilities that are adequately financed that they will be able to pay the generator; otherwise, that’s where the breakdown happens. So things of that nature.  We’ve got—we’ve had events in Tanzania, events in London last week attracting a whole lot of private-sector investors, other MDBs as well. The amount of money required for this is quite large. The World Bank could put almost 40 billion (dollars) to work over the coming five years on this topic. The IMF is collaborating with us for another 15 billion (dollars) or so from their—one of their trusts to be able to create the fiscal headroom for countries to make those utilities liquid and capable of paying and so on. And then from the private sector we’ll probably need somewhere between 20 (billion dollars) and 40 billion (dollars) more. And so this is—this is a real opportunity for a real task. But I just believe it’s the kind of thing we have to do.  FROMAN: A couple months ago the secretary of the treasury came to the Bank, I guess, around the spring meetings and said that America first is not America alone, and that the Trump administration wanted to expand U.S. leadership at the international financial institutions like the World Bank and the IMF. You know, that’s a distinct difference from, for example, the WHO or the WTO or other organizations that the administration has not been terribly warm to. Why is that? What do you think that—how can you think that the Trump—the World Bank can align itself with Trump administration priorities? And how do you manage the fact that you’re, obviously, the World Bank—you’re not the U.S. bank—but the U.S. is your largest shareholder? How do you manage changing priorities in the U.S. vis-à-vis your other—your other shareholders?  BANGA: Mike, the—first of all, that’s—we just discussed nuclear, for example. And Scott and French Hill were extremely helpful in our work of trying to get this to be at a point where people on the board and our shareholders would support it. So would other countries, like the French themselves. You know, that’s two Frenches I just used, but you don’t talk about two other Frenches, right? (Laughter.) So the French government is helpful, too. And as you know, France gets about 70 percent of its power from nuclear, so they kind of get the idea of this topic. So, you know, Germany is going through a change in its approach to nuclear power, and so they were constructively helpful too. Even Japan, which as you know has been through a very difficult time after Fukushima, is keen to get back into looking at the opportunity of what safe nuclear power could mean. And I think the reality is that AI has suddenly made everybody realize that whatever projections we were working with for power consumption will not work in this new environment, and therefore the alternative, you got to—if you’re going to have power that’s clean, and baseload, and reliable, you’re going to have to have things like gas and nuclear to be a critical part of your energy mix going forward. So there’s good, practical reasons behind all this.  Now, why and how does the United States look at the World Bank in these different contexts? I think the reality of why the U.S. understands the value of the World Bank through administrations is we have a power of leverage. So you can—you can put money to work bilaterally, and that’s a dollar for a dollar; or you can give me the money, and if it goes through IBRD or IFC it’s $10 for a dollar because we have a triple-A rating which allows us to leverage up handsomely at a good price with good—(inaudible)—so we can in turn be useful to our client countries.  In IDA, which goes to the poorest countries, we can only leverage up four times. And the reason for that is we give away roughly one-third of what we get from our shareholders to poorer countries every year because they need the money to be in the form of grants—no repayment, no interest. But the two-thirds is at highly concessional terms, and so when that gets paid back you get a corpus so you can keep leveraging. So the math of the leverage in IDA is four times when the rest are ten times.  So the total paid in capital of IBRD, one part of the Bank, is $24 billion over eighty years.  FROMAN: Over eighty years.  BANGA: Eighty years.  FROMAN: And what percentage of that came from the U.S.?  BANGA: Seventeen percent, 3.6 billion (dollars).  FROMAN: The U.S. over forty years has put $3.6 billion in.  BANGA: A large sum of money.  FROMAN: (Laughs.)  BANGA: And the IBRD over the same eighty years has lent out $1.4 trillion. And—and—wait for this; for you bankers, listen to this—what is the—what is the non-repayment on those loans? Essentially nothing.  FROMAN: Zero, right.  BANGA: Two billion dollars are currently in delayed accruals: 1 billion (dollars) from Belarus, which as you’ve noticed is, frankly, with a country that is currently at war with another country, and consequently is not keen to pay us cash back; and the other 1 billion (dollars) is with Zimbabwe, and that’s another case altogether. But on one-point-something—1.5 trillion (dollars), if you have a $2 billion nonaccrual, that’s a nice place to be.  And I think that’s because of the fact that not only do we have on the one hand leverage, but on the other hand we enjoy effectively preferred creditor treatment, because if you don’t pay me back nobody will give you money.  FROMAN: Right.  BANGA: And therefore, the power of those two items together—or, honestly, if the World Bank did not exist today, we would have had to create something like this, and it would be really hard. So using what you’ve got and making it work better, work efficiently, work with the private sector—because there isn’t enough money in government coffers or philanthropies to do what we are trying to do; you have to get the private sector to be a consistent player in the game, and that’s where the jobs are anyway. So getting a focus on the private sector and jobs; making the place work better, more efficiently, a better partner; and at the same time doing so exploiting the leverage and the preferred creditor treatment of the system; and then realizing that we have the ingredients of working with sovereigns but also driving regulatory policy change and combining it with our ability to help the private sector catalyze financing; I mean, that’s a pretty good formula.  FROMAN: Pretty good formula. I mean, it sounds like it should be very attractive to President Trump because it’s mostly using other people’s money and then it’s using a lot of leverage. (Laughter.) He’s familiar with this. Well, no comment. All right.  BANGA: I mean—(laughter)—  FROMAN: Early on in your—in your first year or so as president, the question constantly came up: Are you going to go for a capital increase? Are you going to go to Congress for a capital increase? And I remember you saying: We don’t need a bigger Bank right now; we need a better Bank. We need to demonstrate we can do more with what we have. First of all, do you feel you’ve demonstrated that? And, two, in an atmosphere where USAID has been eliminated, what do you think the appetite is in Congress for a capital increase?  BANGA: I think we will progress back to the earlier part of we’re fixing the plumbing. I think we’re making progress and making the Bank a better bank.  Mike, you’ve worked with me for years. I would never be content with this. So if I think I’m at five out of ten now, if I get to seven I’ll raise the bar and go back to four, because that’s the only way for this institution to truly be a partner of the private sector.  To me, twelve months from conversation to approval is still too long. Nineteen was awful; twelve is still too long. The thirty days for a health-care clinic makes sense, but there’s other projects in there—I don’t mean the hydroelectric dam—there’s other stuff that should also be in forty-five days and two months rather than six months and nine months. Raising the bar to what you take for natural in your private-sector lives is what we’ve got to do if we are going to be seen as the best place to put government money to work for that leverage. I think you don’t earn it otherwise. There’s no entitlement to that money. And so I am very focused on continuing that journey of improving the Bank’s productivity and capability.  Do we need more money? IDA needs money every three years because of that model of giving away one-third of the money. We just finished an IDA round, IDA21 which ended last year, into which—with just 24 billion (dollars) of total financing, which with the leverage gives us about a hundred billion dollars to work with over the coming three years, which is a record amount of money. When the United States administration recently announced $163 billion of cuts in their budgets, they did allow $3.2 billion for IDA.  FROMAN: They continued to support it.   BANGA: Yeah. It’s a lower amount than what was committed by the Biden administration, but only by some little bit. And I think we can find a way to getting back to the 100 billion (dollars). So I’m actually quite constructively delighted that that came through. But I don’t take it for granted, because three years from now I’ve got to do it again. And just so you understand how tough this IDA round was, your questions are all about the U.S. But let me step back a little. In the past nine months during the IDA replenishment, let’s discuss my largest shareholders. Japan, second largest shareholder. The government fell. A new one came in. Declared elections. Came back in a minority, in the middle of this. The Korean government, which was hosting our IDA replenishment event, declared martial law on the morning of the event. Just so you can feel the joy of that day.  FROMAN: Feel your pain, yes. (Laughter.) Yes.  BANGA: And then the German government fell and had a reelection, just came through it. The Canadian government fell, which you’re aware of. The British government changed. The Dutch government fell twice, including recently. The Austrian government changed. Yeah? Shall I keep going? (Laughter.) In fact, the only government that didn’t change of all my shareholders was the Chinese. And that’s another topic all together. (Laughter.) So if you see it from my eyes, I had to go through an IDA replenishment and get to a record. But the only question people ask me is about the U.S. And I will tell you, you’re focusing on only one aspect of it. For people like us, back to your point about 17 percent shareholding, I have to work with the other 83 (percent) too. And that’s my job. And if I didn’t like it, I shouldn’t have taken it. And that’s how I think about it.   FROMAN: There are a lot of developing countries that are having an unsustainable debt profile at the moment.   BANGA: I would argue we’re getting there too, so.  FROMAN: Well, there’s a—we’ll leave that to another bank. We’ll leave that to another bank. But with the cutback of aid and increased needs—fiscal needs on their part, how do you see the debt issue being worked out over the next few years? And particularly, since you mentioned China, China’s become a major creditor. Not always in the same format as other creditors for restructuring. What role do you see China playing in helping to solve some of the unsustainable debt issues?  BANGA: So, Mike, first of all, big picture, funnily enough, given that the U.S. dollar has weakened over the last few months, and I don’t know where interest rates will go yet but you got to put those two things together, in an odd way, unintended way, a lot of the countries who were having real debt distress was because they borrowed money but interest rates were very low, and they borrowed in dollars and euros. So they got a double whammy over the last five, seven years. This is actually turning towards being helpful, in a really odd, unintended way. And I think just keep that somewhere at the back of your mind as you think this through.  The G-20 has a common framework for working out some of this debt. It goes past the old Paris Club because, as you just pointed out, the creditors have changed. You mentioned China, but there’s a bunch of bilateral creditors in there who were not there in the prior debt crises. In addition, commercial financing, cross border, is up a great deal. None of this, by the way, is discussing the domestic debt. We’re still only discussing international debt. And so the mix of creditors into these countries has completely changed. And so what we’re—what the IMF and us are on together is something called the Global Sovereign Debt Roundtable, which has the Paris Club, bilaterals, and commercial players all in the room at the same time.   And four countries are going through the G-20 common framework in Africa—Ghana, Chad, Ethiopia, and—who else? Four of them are going through it.   FROMAN: Zambia has already gone through.   BANGA: Zambia. Four. Some of them have got—took a long time to get through. Others have gone through faster. The recent ones are quicker because we’ve learned a few lessons along the way. You know, you settle a level of agreement of how many cents to the dollar with the official creditors, then you go back to the private sector and they don’t agree, they strike a different deal, at which point these guys don’t agree. So you’ve got to kind of do it simultaneously. The second thing was you needed transparency of what the actual debt was. A number of the deals that were signed by bilaterals, including China, had confidentiality clauses in there which prevented the countries from declaring what exactly were the terms of their loans, and therefore you couldn’t figure out what dollar haircut you had to take.   And so all that’s become much clearer. We’ve set up a much level—a much more transparent playing field on some of the debt data. I’m actually encouraging the G-20 to now do this for all the G-20 countries, not just the G-7 which is what was done till now, so we can get even better data going forward. I suspect you will see this cycle come through the same way other countries, when they see this can work faster, will line up and come through the pipe. But this is tough. You know, and that’s why I think you’ve got to worry not only about those who are currently in distress, but think in terms of those who have liquidity issues as well. And because a lot of them have got refinancing of debt coming up. And to me, that will become a solvency issue if we don’t solve the liquidity issue.   And so with that we’re working on two or three pillars of work. One is to increase net positive financing to all the international financial institutions into them. Two is to work hard on domestic resource mobilization with those countries, so they also have to do some work on it. And so—and the third part of it is what else can we do to help them with this transparency? And that’s what’s going on.  FROMAN: Before we open it up to the audience, I will just give you a lightning round of questions.   BANGA: Yeah? (Laughter.)  FROMAN: What are you most proud of accomplishing in your two years there? What’s your highest priority unfinished business? And, knowing how much you love KPIs and metrics, how do you measure what success looks like five, ten years from now?   BANGA: Well, I don’t plan to be around ten years from now, so that’s an easy one. The first one, I think what I’m most proud of is the alignment that I now see among lots of people in the Bank about the idea of fix the plumbing, you’ve got bigger work to do, let’s align around jobs, that’s what we got to do. You can see that filtering through. I have no doubt that there’s still people at the Bank, Mike, who wish I would die tomorrow morning. I have no doubt. (Laughter.) I have no doubt there are plenty of people, however, who understand the idea. And there are those who are still not sure and waiting to see which way this goes. That’s normal in change. When you’ve got an eighty-year history, you will get these three sorts of people. That doesn’t worry me. I’m beginning to see the momentum behind alignment. And to me, that’s what I went there to do. I think that’d be good. That connects that idea of the scorecard as well. That’s why I felt a five out of ten on getting to where I need to.   KPIs when I’m done? I don’t know. I’ve got a five-year term. I’ve got three years to go. So let’s talk about five years rather than ten. My view is that if in these five years I am able to get the institution to get the speed of projects to come down even further, that would be, from a client’s point of view, the most important difference they will see in us. Because you’ve got to remember, at the other end, if it’s a democratically elected government, it’s probably got a four- to five-year term. If you spent two years discussing a project for approval before it even starts getting implemented, how much interest will that government have after the first two years of their term to keep speaking to you? And that means you are—you’re not getting a smooth pathway to development. You’re getting a jerky pathway to a dialogue. Changing that to where things go through the pipe at a pace that they should will change completely the interaction between development banks and countries. And to me, that is the most important thing we can change.  FROMAN: Terrific. All right, let’s open it up to questions here in the room. I see one way in the back. Just to remind people this is on the record, or not for attribution? On the record? On the record. So identify yourself and make a short question.  Q: Thank you. Fascinating discussion. Bhakti Mirchandani, Trinity Church New York.   You mentioned power as a solution to the—to the jobs deficit in developing countries. Can you kind of share more about AI, white collar jobs in developing countries, AI, you know, white collar jobs here? What models have you seen that work?   BANGA: Sure. Sure. So the AI topic is an interesting one. I want to break AI into—whenever we go through this—into big AI and small AI, when we come back to the discussion. What I mean by “big AI” is what most people discuss, which is these large data-driven models.  Now, to do AI well you need four things to happen. You need computing power, lots of it. You need electricity, a heck of a lot of it. You need data, lots of it, kept in its simplest form so it can be manipulated to the maximum extent possible and then kept safe and secure with the right rules around privacy. And the fourth thing you need is you need people who understand how to make that work and create the first algorithms and the work of working with such stuff.   There are very few developing countries, aside from an India or a few others like that, that actually have those four things. And even India will be stressed on the power.   Which surely means that for AI to work in the developing world, there’s a very big gap between what they’re being told—that AI will be like, you know, the cellphone—you will go from rotary dial to cellphone capability and skip through everything. I don’t think this is the same thing.   And if you believe that the way is then for large Western or Chinese or Indian companies to go operate the AI for you in your country, think through the implications of how countries will think about the national security aspect of their citizens’ data being used elsewhere, and you will very quickly realize the balkanization that will come into these models is more than people are willing to discuss right now.   So I’m actually quite concerned that Big AI will in the beginning create a bigger disparity between the developed world and the developing world than we currently understand.   The other side of that is, I think the job impact is a more serious topic in the developed world in the early years than it is in the developing world.   Small AI, on the other hand—local models, delivering locally derived data, delivered on a dumb phone.   So let me translate that. Think of a farmer attached to a farmer-producer organization or cooperative in Uttar Pradesh, in India, and if I could use my phone to look at my crop and say, that disease—I don’t know what it is, but this spray from my cooperative which costs 500 rupees will help me kill it. That’s small AI at work. That’s amazingly productive.   And so I think if you segregate big and small AI, there are two different roles in the developing world. But you need to think about it that way rather than the impact of jobs in the developing world, of big AI in the initial years. Down five or ten years, it’s a whole other topic, but I don’t think that’s the case today.   The second thing is that when we’re talking about jobs in the developing world—I should have said that when Mike asked me that question—we’re talking about focusing in areas that are locally relevant and don’t rely on outsourcing jobs from the developed world. So let me give you what those sectors are. This came up through a jobs council that we’ve set up with President Tharman of Singapore and former President Michelle Bachelet of Chile and a number of CEOs and civil society people. And here are the five sectors. The first is infrastructure; it’s construction, but then it’s enablement in what it does.   Second is agriculture as a business, particularly trying to make small farmers productive so they don’t get incented to sell their land and finally end up as urban poor. And that’s the example of that small AI app and many such things.   Third is primary health care—not just because you get a healthier population, but if you do it well, you’ll employ nurses and medical diagnostic technicians and midwives and the like. And there are examples like this in Indonesia where we’re working with the Indonesian government. Their president is about to announce that on a citizen’s birthday, every one of those citizens will get access to a free annual health checkup at a distributed system of health-care clinics. We’ve been working on them for a few years now.   And a fourth such item is obviously tourism. We’re not tourism experts, but we can help with the skilling institutes that go into providing the right kind of skills for that tourism.  And the last one is value-added manufacturing for domestic consumption and regional trade and the like, including minerals and metals that the developing world is blessed with that we all need.  So in these five, there are lines from AI and there are lines from outsourcing is relatively low compared to other categories. And so there is a way to think about this in a more constructive way than just what AI would do to it.   FROMAN: Yes, right here, third row? The microphone is making its way to you.  Q: Monique Mansoura, independent strategic advisor on health security and biotechnology. So inspired by your work and this discussion.   A question I have is, you talked about the soft enablers of health and education, and can you say more about that? I come from the work of health and biotechnology, and we really struggle with sort of the linkage to what a driver of economic development is—driver of jobs, how much harder it is if you don’t have health to be a worker, to contribute to the economy.  FROMAN: Yeah.   Q: So I’d love your thoughts on that. And also sort of the insults that are things like the COVID war, right, one of the words we didn’t talk about—we lost 7 million lives—and the risks that persist in those types of threats. So I’d love your insights.  BANGA: Yeah.   FROMAN: Thank you.  BANGA: You know, one aspect of this health is—you just heard me talk about this primary health care. So we’ve made a commitment that we’ll reach 1.5 billion people with better access to primary health care by 2030. Indonesia alone, as it turns out, will deliver 290 million out of the 1.5 billion with this one—because this work has been going on for a while with them.   And so this December we are launching an effort with the government of Japan and the WHO, and Japan built some of the best universal health-care thinking after the Second World War and has built on it. Japan’s not a poor country, and it can afford something. But the ideas and learning from it are what we’re trying to bring into our primary health-care rollout across the system.  Yes, it’s for getting better workers and healthier workers, but actually to be completely honest, it has two other benefits—the one about jobs, the nurses, the medical diagnostic technicians, the midwives—not just doctors but all these. And in fact, it’s—the Indonesian government computed that it’s the single largest possible generator of jobs other than tourism for the Indonesian government in the coming years. And then it will drive health-care costs down, which otherwise are climbing in Indonesia and reaching levels that they are much lower than, say, Malaysia or Singapore, where that would be a crippling number if they got to that. So this is a way of bending the curve by early diagnostics.   But the other aspect of it is catching the next pandemic early. If you do have distributed health-care clinics, which are doing regular testing and diagnostics, the probability of catching the next pandemic earlier is much higher than it was during COVID.   So there’s a whole series of benefits inside the idea of rolling our primary health care which are important.   The Indonesian one started with an effort that had begun in China, went to Peru and Indonesia and other countries, on stunting. So children in Indonesia a little while ago—30-odd percent of the kids in Indonesia were stunted because of malnutrition in the womb, and then for the first 1,000 days, including the time in the mother’s womb. And there are statistics available that tell you that a stunted child earns 17 percent less per year throughout their life than somebody without stunting. So think of the dramatic progression impact of that number—17 percent less per year throughout their life, throughout their working life, than somebody who wasn’t stunted.   So there is numerical information as well available to justify a lot of what should go into health care for the right reasons.   FROMAN: Yes, Fred Hochberg?   Q: Fred Hochberg.  I’ll tell you, years ago I remember when I chaired the Ex-Im Bank, multilateral banks like Ex-Im around the world could not be subordinate to World Bank desks, so we sort of were boxed out of financing those projects. Is there any way around that, or has that changed at all, that you could then utilize all those export-import banks around the world?   BANGA: Hi, Fred. Nice to see you, buddy.  It’s not so much IBRD and IDA that is where that comes up. What I’m trying to do with IFC for the private sector, which is where ex-im also plays, is to allow IFC to play a role where needed of being junior equity, of first-loss taker. Because clearly, when you—this private-sector lab that we had set up which had—which Mark Carney and Shriti Vadera were chairing at one time before Mark went off to do a slightly less important job—(laughter)—thank God he’s there.   And so if—that group of CEOs came back—including Larry Fink and a bunch of others as well—came back with five things to work on. One of those was if a project in the emerging markets has all these other risks attached to it of foreign exchange and political risk, which we can help with but it still has it, and therefore for David Rubenstein as an investor the water is still here, how do we bring the water down here? It could be if IFC said I’ll take junior equity or a capped return of 6 percent or whatever and allow it to come down here. That hasn’t been our role, because if we actually booked the loss I’m going to have to go back to my shareholders over time to get a capital increase, and that’s an ugly discussion. So how do you manage that dynamic is the issue.  What we’ve done is we have created a new fund called the Frontier Opportunities Fund. I didn’t want to call it a First Loss Fund for obvious reasons, right? (Laughter.) As a banker, it kind of makes me uncomfortable. But Frontier Opportunities Fund sounds pretty cool. And we have funded it from our own regained earnings to start with, but now I’m going to philanthropists like David Rubenstein and saying, how about putting your money where your mouth is and—(laughter)—you know, and giving some money for the right reason. If I’m taking a risk to help private-sector capital go into these emerging markets for development and you believe in that cause, then help me out with this. I’m just kidding. That’s the kind of thing I’m trying to do. And I think that’s very different from what it was, like, Fred, when you were discussing that topic, so.  If you go back to the Ex-Im Bank, come talk to me. (Laughter.)  FROMAN: This gentleman here in the front row.  Q: Glenn Creamer, World Affairs Councils of America.  I’m curious—I know it’s not your mandate to deal with humanitarian assistance the way USAID did, but since the U.S. was the largest donor country and you talk about 300 million people getting electricity in Africa of the 600 million that need it, I’m curious the impact of the, basically, closure of USAID, the termination of almost 10,000 people, and the retreat of the U.S. from the humanitarian assistance realm, what—how does that impact your work, or does it? I mean, you have your own mandate and you’ve got to push ahead, but I’m just curious, people need electricity but they also need food, they’re also—you know, they need medicine, they need a lot of things which the U.S. was providing and no longer is. Thank you.  BANGA: Yeah. Yeah. Well, so, the first thing is it does impact us in one way somewhat directly, which is trust funds that we hosted which may or may not be contributing to our work but we host them because we provide hosting services for a lot of these. A number of them had some funding from USAID, and that obviously has gone. And so those people are stressed about how to manage their numbers. That’s not direct impact, but it’s there. I see them. I meet them. I hear them.  The indirect impact is if you are funding in some countries a large part of their health costs through this, then, you know, they will come back to us looking to put IBRD and IDA money to work towards supplementing their health budgets. And to me, that’s an indirect impact. It’s, obviously, taking away from something else we could have funded. But it’s a question of prioritizing the right thing at the country level.  One of the challenges we had as a Bank which is part of the making us work better is that we have this thing called a country partnership framework, which is the equivalent of a strategic plan for the country. And if you write it too broadly, you can end up justifying any project for its financing. What I’m forcing our teams to do across all the parts of the Bank is, first, write one for the whole country because most countries view public-private partnerships as an integral part of their life, and therefore giving them a public-sector CPF separate from a private-sector one isn’t very useful. And so getting one done together is kind of practical.  Secondly, write it in five pages, as compared to a hundred and fifty, because your client will not read a hundred and fifty pages. They’ll give it to somebody seven levels down to translate into an executive summary. You may as well do it yourself, because then your words will be seen and you’ll be forced to prioritize. Prioritizing forces your client in the government to also indulge in that degree of thinking through what will make the most difference for my country in the coming three, five years.  And so, in a funny way, this is helping us get CPFs to get prioritized because the sense of urgency has gone up. This is a complicated time in the entire aid firmament. It’s not an easy time. But, you know, we aren’t directly, as you said, in the humanitarian business. So I’m using it to make my work better and more efficient and more useful to a country. But it’s a bad time, in that sense.  FROMAN: Yes. Woman, right about midway. Yes, further, sorry. We’ll try and get to you if we can.   Q: Hi. I’m Margaret Williams, a fellow at the Belfer Center at the Harvard Kennedy School.   I was wondering if you could speak about the Bank’s role in climate change, particularly in context of massive growth of AI, considering that the U.S. leadership on climate change is just dropping to zero and we apparently don’t have climate change, and we’re cutting science for climate change. But just maybe the Bank’s role in leadership on climate matters, considering your other priorities. Thank you.   BANGA: So, you know, this is an interesting discussion. Our clients are demanding help on certain things. And this is coming from them. So if you’re a client who’s at the receiving end of big challenges of weather pattern changes, or forest fires, or things that impact you, what we will call “adaptation” in that part of the world, they’re really keen that we work projects with them that help them. Or they’re looking for ways to mitigate the future growth of emissions by looking at stuff like a rail corridor instead of truck transport in Lobito, in Africa, for example.   When I talk about the World Bank wanting to put 45 percent of its financing into climate-related financing, one of the biggest discussions with governments around the world right now is, what does that mean? The U.S. is saying, I don’t like that because you’re diverting away from what is the purpose of your mandate, which is education, health care, and so on. And when I explain that you may think that, but actually the 45 (percent) is not going into solar and wind. It’s actually going half into adaptation, which is a school that is hurricane-resistant, a road that doesn’t get washed away in the monsoons, seeds that are heat—you know, capable of surviving hotter temperatures, drip irrigation instead of flooding irrigation. Most of them will say, we should do that in Miami too.  And then, if you—if you talk about mitigation, and you say it’s about the Lobito train corridor instead of trucks, and it’s about, you know, growing rice with the kind of methane emissions that are much lower because you manage it better than flooded fields, or it’s about fighting methane emissions from flaring and the leak of gas, or it’s about electric buses instead of diesel buses in a bus rapid transit system, then most people agree with that too. The problem is that the words “climate finance” are getting weaponized in this situation, on both sides. You will find the Europeans are ready to commit hara-kiri if you change the word.   And so we need to find a way, with those shareholders that I have who represent the whole world, to find a sensible answer where we do what we need to do. Because we’re not targeting 45 percent of our money going there. As we build schools, we’re building them hurricane-resistant. Why would you not? As you build a road, you’re building it monsoon-proof. As you put seeds to work, you’re building heat-resistant varieties of seeds and putting them in. So automatically more and more of my financing is going into what our shareholders and the MDB world count as climate financing. It’s not the target. It’s a derived number.  And so I still think our role is to do things in a smart development way, and to meet what our clients need. And our clients are asking for this too. But I’m not taking money away from schools or health care or skilling or bridges or roads or airports. I’m actually making that integral to what we’re doing and connecting it to jobs. But doing it in a way that we call “smart development.” And so use whatever words you want, but don’t make this a fight that throws the baby out with the bathwater. That’s what I’m trying to explain everywhere that I go in public. And that’s all I can do.  FROMAN: Third row there.  Q: Thank you so much. I’m Caren Merrick. I’m a tech entrepreneur, and recently served for three-and-a-half years as the secretary of commerce and trade in the commonwealth of Virginia.   And so, Virginia—my perspective is, Virginia is the datacenter capital of the world. And all of the global hyperscalers who are building out across the world, employing folks, and they’re a magnet for economic development wherever they go in the world. But these hyperscalers are also becoming nuclear companies. They want to generate their own power. And they are also placing bets on, as you mentioned, the World Bank is looking at who is standardizing. And so there are countries—France, Canada, the UK, and the United States—that are all building out technologies. How does the World Bank—I’m just interested in your perspective. How do you think about who to place your bets on in this frontier, where nuclear is going to be critical? It’s clean, it’s affordable, it’s abundant, and it’s innovative. And how do you think about that? Thank you.  BANGA: Yeah. I don’t know the answer to that yet, because this approval happened day before yesterday. (Laughter.) And after forty years—  FROMAN: What have you been doing since? I mean—(laughter)—  BANGA: Exactly. And after forty years of not doing it, you know, if you were a highly qualified nuclear scientist, you wouldn’t want to keep working at the World Bank for the last forty years, because we weren’t doing anything. So we’ve got people who understand nuclear science because they’re still working with us in different aspects of our work, but the first thing I have to do is rebuild a pool of talent, and do so with the IAEA. That’s why I’m so keen for Rafael and I to have this partnership, because I think together we can make one plus one equal to three.  I do believe, however, that my job is not to place early bets, like a venture capitalist, on new technology. My job is to come and help to standardize and build quality standards in the system. And then when somebody is coming through as a racehorse to win, put enough money on it to get it to scale. And maybe the scale will bring the costs down. And that will be a good place to be. That’s kind of how I think our future could go. We’re not there yet as an institution. It’s very early. So ask me this next year. And we’ll see.  FROMAN: I think that’s a commitment for him to come back next year, so. (Laughter.) This gentleman’s been very patient here, second row. Here comes a microphone. And if you could all speak up, make sure people can hear.  Q: Hi. John Tyson. I’m an executive investor in the food sector here in the U.S.  My question is about global poverty alleviation, you were talking about earlier, in agriculture. In the World Bank’s toolkit and set of priorities, where does agricultural productivity and supporting agricultural livelihoods fit in the total puzzle?  BANGA: Yeah. Huge. It was the number two in the list of the five job generation systems I talked about. We’ve committed—like we did the 1.5 billion people for health care, you’ll see a method in the madness of our commitments now. We had committed $9 billion a year, which is double what we’re doing today, in this agriculture as a business, oriented towards small farmers. So not oriented towards mechanized farming and large agriculture, which we are not needed for. There’s enough commercial money there. This is, as you find in the emerging markets, a number of people here originated from there, you will see that the single biggest crisis in the farming communities is that the children of small farmers don’t want to be farmers. And they tend to sell off the land. And at that time, they think they’re rich. And they buy a Toyota, and a TV, and smoke and drink. And then four years later they’re in a shantytown on the outskirts of an urban city looking for gig driving jobs.   That is a tragedy. And it’s going to get worse. It’s true of where I grew up, in India. It’s true of my home state of Punjab, where this is a real crisis. But it’s true of other places too. So fixing this is quite important. It ranks up there in terms of keeping people wanting to pursue their parents’ profession as a respectable, with productivity, with a decent life profession. To do that, you’ve got to start thinking in terms of building out how do these farmers get access to better markets for their produce, better pricing for fertilizer, better tools for figuring out which pest is on their plants, better—and so on and so forth. So we’ve built an open architecture platform with Google where you can feed in the farmer-producer organization, cooperatives in the old days, on the one hand, and then feed in a buyer, a fertilizer, a seed producer, a crop insurance provider at the other end, to create the marketplace. And every click creates a certain amount of cents going to the people, and creates a business model.   That’s what we’re working on. And I just came out of Uttar Pradesh recently, and that’s why I mentioned that earlier. I went and visited six such FPOs that we saw working there. And that’s the kind of model I want to lift, along with the Google product formula. Take it to a bunch of places.  FROMAN: Great. Last question here.  Q: Thank you. Thank you so much, Ajay. My name is Joyce Zhang Gray. I’m with Visa, but more importantly I was—  BANGA: Oh, God.  FROMAN: Visa.  Q: I know. (Laughter.)  FROMAN: I’m sorry; we’ll take another question from that—yeah. (Laughter.)  Q: I was going to say, but more importantly—  BANGA: Although I can see others who are ex-Visa sitting right here. (Laughter.)  Q: I was classmates with Aditi in both college and business school, so I’m friendly. (Laughs.)  BANGA: Oh, you’re fast. That’s my daughter. You’re good.  Q: I’d love to learn more about your thoughts on promoting local business creators, those who are job creators, entrepreneurs.  BANGA: Yeah.  Q: And also, in this age of the freedom of movement of knowledge and labor, but the restrictions because of immigration, there’s less brain circulation of those who might study abroad and come back to their communities to build jobs. What do you think the implications will be? And how can we—  BANGA: So the thing is that talent is everywhere but opportunities are not, right? So the trick is to allow—of course, by jobs I don’t mean only companies; I mean entrepreneurs as well.  To give you an example, having studied this issue for a long time, the reason that women don’t open—Silicon Valley’s funding for female-owned businesses is a tiny percentage of the total money going in, even today. There are reasons why this is even worse in the emerging markets. One of the challenges is women don’t own the assets in many emerging markets. The legal and cultural system fights against it. So if you give a woman a loan, she will be able to leverage that by going to a bank and saying, hey, the IFC gave me a loan, and she might get another two bucks from some bank. But if you give her a grant of equity or if you give her access to equity, she’ll probably raise ten from banks. And so the multiplier effect of equity is what we are talking about here. So one of the commitments we’ve made is to reach 80 million women with access to financing, about half of that with equity and half with debt, in these coming years in a chance to give them the ability to create entrepreneurial energy.  I was in—I was in Nairobi and visited an innovation center we had set up along with the government of Denmark and the UK, and 3,000 businesses have been through it in the last few years. And 60 percent of them are women-owned. And what—it was supposed to be towards climate benefits. So these two girls I met there—literally girls; they were—I mean, by now they’re about thirty, but they were—when this started they were in their twenties. And you know, mangoes that get a blemish on the outside, nobody buys them but they’re perfectly fine. So they would buy these mangoes at a discount, and air dry them, and then package them and sell them as dried mangoes, which I thought was something only Indians ate. Turns out the entire equatorial belt loves their Jais. (Laughter.) And so it became a decent business. And then they met a guy at that innovation center who was processing biomass for pellets, and they started buying his biomass and a furnace. And then they found somebody else who was selling a secondhand Tetra Pak machine in that center. Now they’ve got a $23 million revenue.  FROMAN: Wow.  BANGA: And I—you know, I think the biggest thing this Bank can do after bringing down the time taken for projects is to learn how to steal shamelessly and duplicate, duplicate, duplicate as many times as you can. Because an idea like that, this innovation center, why shouldn’t we have a hundred of these in Africa? We don’t. We’ve got a few. And so the power of an institution like ours is create/prioritize things in countries—few priorities, get things through the pipe fast, and then help to duplicate and transfer success, because then we make a difference in a finite period of time, including for entrepreneurs. And that’s the kind of thing that I’m trying to change.  We have a knowledge bank. It is full of experts. You can—you want to learn about drinking water? Tomorrow morning you’ll have three people with PhDs and Nobel Prizes sitting with a chart paper telling you all about drinking water. That’s lovely. My problem is I want those projects replicated in a hundred places. We’re taking our knowledge bank, which is across the IBRD and the world—the public-sector side and the private side, putting it together, and in every practice we’re going to have one group of people who focus on regulatory policy change and policy—back to my earlier discussion, one group of people whose only job is to steal shamelessly and copy. And stealing shamelessly is a really good thing—(laughter)—when it’s for the right reasons, and that’s what I’m trying to get done. Productizing—what people in the consumer world would say, you productize what you produce. You test it out and you roll it out. That’s what we need to do more of.  FROMAN: I’ve known Ajay for twenty-five years. I worked directly for him for about four years, Mastercard.  BANGA: Tough times.  FROMAN: Inspired by him every day. I think you can see why. Please welcome—please thank—join me in thanking him for being here. (Applause.)  (END)  This is an uncorrected transcript.   

Former U.S. ambassadors and IAF alumni reflect on the challenges of representing American interests amid rising authoritarianism, strained alliances, and shifting trade and security priorities—as well as how diplomacy is adapting and what it continues to get right. The International Affairs Fellowship (IAF) Keynote is made possible through a generous gift from Janine and J. Tomilson Hill in support of CFR’s flagship International Affairs Fellowship (IAF) program. For more information, please visit CFR’s Fellowship Affairs Page.  A special series of summer meetings will follow this session, featuring a selection of CFR’s recent IAFs, IAFs in Canada, IAFs in India, IAFs in Indonesia, IAFs in Japan, IAFs for Tenured International Relations Scholars, and IAFs in European Security. Information about the summer sessions will be announced at a later date.