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CHRISTIANE AMANPOUR, CHIEF INTERNATIONAL ANCHOR: Hello, everyone. Welcome to AMANPOUR AND COMPANY. Here’s what is coming up.
Moving next door to Vladimir Putin, Estonia’s Prime Minister, Kaja Kallas, tells me about staring down the Kremlin and cruising to election victory.
Then —
(BEGIN VIDEO CLIP)
JOE BIDEN, U.S. PRESIDENT: Americans can rest assured that our banking system is safe.
(END VIDEO CLIP)
AMANPOUR: Tamping down panic in the USA after the collapse of a major bank gives investors flashbacks to the 2008 financial crisis. Economists Betsey
Stevenson joins me alongside James Jacoby, director of the new frontline documentary, “Age of Easy Money.”
Plus —
(BEGIN VIDEO CLIP)
ADAM GOPNIK, AUTHOR, “THE REAL WORK: ON THE MYSTERY OF MASTER” AND STAFF WRITER, THE NEW YORKER: Everything you try, whether it is drawing or
dancing or boxing, which I took up, begins with a set of small awkward steps.
(END VIDEO CLIP)
AMANPOUR: How to master a craft. Writer Adam Gopnik tells Hari Sreenivasan the tips and tricks that he’s learned from the greats for his new book,
“The Real Work.”
Welcome to the program, everyone. I’m Christiane Amanpour in London.
It is painful and it is tough and it’s where Ukraine’s future will be determined, so says, President Volodymyr Zelenskyy about the brutal
fighting in the east of his country. He promised that we need to destroy the enemies’ military power and we will. But as anyone can see, it is a
very tough slog. Russians and Ukrainians are essentially locked in a war of attrition. Each side rapidly losing troops, something Russia has in much
bigger supply.
Europe and America are still promising to back Kyiv for as long as the takes, but there are questions about whether their weapon shipments are too
late, too little. And now, the likely Republican presidential hopeful in the United States, Ron DeSantis, is making news by saying, getting involved
in Ukraine is actually not in America’s vital national interest. Calling it a territorial dispute between the parties, rather than the fight to protect
freedom and democracy from tyranny.
No one knows this more than Ukraine’s loudest backers, Putin’s neighbors. Like the Estonian prime minister Kaja Kallas. Indeed, her fierce support of
Ukraine helps secure an overwhelming re-election victory just last week.
When she joined me from Tallinn, she sounded the alarm against any idea of appeasing Putin amid worries that steadfast allied support of Kyiv might
waver this second year of war.
(BEGIN VIDEO CLIP)
AMANPOUR: Prime Minister Kaja Kallas, welcome back to our program.
KAJA KALLAS, ESTONIAN PRIME MINISTER: Thank you for having me.
AMANPOUR: So, the world really did watch, particularly in this moment of Ukraine and NATO and an alliance. The election in your country and seemed
to be breathing a sigh of relief. You did score a decisive victory. So, is that it? Job done or what next?
KALLAS: Well, we have a system that is in favor of coalition government. So, although we won a landslide victory, we also have to form a government
and put together a coalition. And right now, we have the talks going on. And, of course, everybody has very many ideas and you have to get, you
know, the compromises together. So, it takes time still.
AMANPOUR: So, you are known as one of the strongest, if not the strongest, voice in support of having to back Ukraine to victory. Your coalition,
could it define what you do next as Estonia regarding this continued support?
KALLAS: We already agreed upon Ukraine and everything related to that. And we share with our new partners the same views that we should help Ukraine
as long as it takes. So, we should give the military but we also should talk about accountability and a special tribunal on the international
level. We should also talk about boosting the defense industry so that we would have enough ammunition to send to Ukraine so that they can defend
themselves. So, in that regard, the new government will hold the same line as so far.
AMANPOUR: So, let me just talk about the latest reports from the front line. There is a very alarming interview and report from “The Washington
Post” on the eastern front.
Quoting a Ukrainian, I believe a lieutenant or a colonel, basically, saying that we do not have enough people. We do not have enough trained troops
anymore. We’re losing our best people. We are not getting all that’s being promised by you all in the west in time for right now. How — have you
heard this? And how alarmed does that make you feel?
KALLAS: That is frustrating and we have heard that as well. And that’s why some weeks ago I made the proposal on the European level to do this, you
know, use this same mechanism as we did with the vaccines that we provide the funds and European Commission will directly procure the ammunition. So,
that the defense industry could also boost their production.
What is the problem is that, you know, the military industry in Russia is working in three shifts, whereas the defense industry in Europe has not
boosted its production. And they have to do that. If you talk to the defense industry, as I have done, they say, we don’t have orders. Although,
you know, everybody’s pledging on increasing the defense expenditure and also sending arms and ammunition to Ukraine. So, I was just thinking how to
boost that and get that ammunition and equipment to Ukraine as fast as possible because the price goes up with every delay.
AMANPOUR: So, are you — you know, we’ve all been hearing about a much- wanted Ukrainian counteroffensive. From what you know, do you believe they’re in a position to be able to wage that? And if they don’t, what does
that mean for the course of this war?
KALLAS: We have to look at the Russian side, and the Russian army’s not happy at all as well. So, I think there are two sides. On one side is
Ukraine and we have to help them as much as we can, as fast as we can. But on the other side, there is also, you know, Russia and the parts there how
the armies feeling there. And they are not happy either with their equipment, with their, you know, ways that they are treated. But
definitely, it is critical that Ukraine does not lose the spirit and the force to defend themselves.
AMANPOUR: And how do you propose to change that? Look, I’ve heard you quoted as saying that even now many in Europe are still not there yet when
it comes to understanding that you have to confront Putin, as you view it in your, you know, frontline state. You’ve said that you are concerned that
a, sort of, maybe a sort of an atmosphere of appeasement is settling over the alliance now. Is that correct? Is that what you’re worried about?
KALLAS: I am worried about this. And not on the leaders’ level, but I’m also reading the media in different countries, which are allied countries.
And I hear the moods that are there. And there is the fatigue with the war, that is understandable. There are worries like high inflation and other
domestic problems kicking in everywhere. And it is a bit coming from here and there that, you know, let’s just do something to stop this war.
But the question is what is stopping this war, really? So, if we just say to Ukraine that, you know, sit down and agree, give some territories away,
and then we have peace and we can go on continuing our business as usual, then the outcome is that we don’t have a peace that is lasting. We might
have a peace or a truce for two years or four years but then it will continue in a much broader scale. And that is a threat to the European
security architecture.
The other possibilities to really give everything to Ukraine. That they can defend themselves. That they can also defend the U.N. Charter that says
that every country has the right, you know, sovereign right to exist and also defend itself. So — that we will be by this. We will really be united
behind Ukraine, and Russia gets the message that you can’t win this war. And the war will stop when the Russia understands that it is a mistake and
they will back off, like they did with Afghanistan, for example.
AMANPOUR: Yes. So, let me play — I’m sure you agree with the foreign minister from a neighboring Lithuania who spoke to me from Washington. He
was trying to say the same thing that you are saying to Secretary of State and in Congress.
And this is what he said about rising thoughts about negotiations.
GABRIELIUS LANDSBERGIS, LITHUANIAN FOREIGN MINISTER: If somebody suggests that we should be negotiating with Putin, and I think, how do we reconcile
that with the idea of a special tribunal? You cannot have both. You cannot have somebody who is actually guilty for act of aggression, for ordering
his generals and troops committed war crimes and then sitting at the same table to negotiate, you know, ceasefire or seizing territories. You have to
decide.
AMANPOUR: Your commentary?
KALLAS: I agree. That’s why we’ve been pushing for the accountability, really. I mean, when we look at how we can cut this historical cycle that
Russia will attack its neighbors then it is the question of accountability, really. And of course, when we are putting together the tribunals to
process and prosecute the crimes of aggression and the war crimes, then it is clear that, you know, you can’t sit down with the criminals, the war
criminals or the criminals that have really put-up genocide and the war of aggression, really. So, this is true.
But to cut this historical cycle, accountability is a key. And not the hybrid tribunal that will leave out Putin and Lavrov or the leaders of
Russia. But actual tribunal to prosecute the crimes of aggression which is a leadership crime. Because without this leadership crime, there wouldn’t
be any more crimes either.
And when we look at the history again, Germany, for example, one of the effects of Nuremberg (ph) tribunal was that the German people got to know
about the crimes that were committed by the Nazis and the whole world, as well, condemned the crimes of the Nazis. That was never the case for the
communist crimes that were committed here or in Ukraine by the Russians.
AMANPOUR: And of course, you talk about the historic and illegal annexation of parts of Estonia by the Soviet Union way back when. I want
to, again, ask you, again, you know, Foreign Minister Landsbergis was in the United States. And this is Florida Governor Ron DeSantis on Fox News,
of course, he’s probably heading, he hasn’t fully declared yet, for a presidential bid. And this is what he saying, while the U.S. has many vital
national interests, becoming further entangled in a territorial dispute between Ukraine and Russia is not one of them.
He has previously called Zelenskyy an anti-hero. And you know what’s going on in the right wing of the Republican Party. Does this concern you or is
that just electioneering?
KALLAS: Of course, it concerns us because what we are talking about here is the rules based international order. We have agreed, all the countries
that are members of the United Nations. There is the U.N. Charter and the United Nations was put together in order to have peace in the world. And in
that charter, there are rules that, you know, you can’t — you cannot attack another country. And if you do, there should be a punishment as
well.
If we say that, you know, let’s look away and this is nothing, then the aggression really pays off. And all the aggressors or would be aggressors
in the world are watching very carefully and taking notes how we deal with Russia in this case. Because, you know, if aggression pays off, then, you
know, there is — there are no limits. And that is also the threat to international rule space order but also security because, you know, we have
to think about completely discrediting the tool of aggression as a policy tool. It can’t — it has to have a higher price than not to attack another
country.
AMANPOUR: And I’m really interested — I’m really internalizing what you said. You have to break the historical cycle of Russian invasion and
aggression. So, you know, what you are saying seems to be proven right because Russia is still, even now, trying to weaken democracies on its
borders. This past Sunday, police in Moldova have arrested men with ties to Russia who were trying to whip-up antigovernment statement — sentiment
against the government of, obviously, the pro-EU President, Maia Sandu.
This is what the White House said, as Moldova continues to integrate with Europe, we believe Russia is pursuing options to weaken the Moldovan
government, probably with the eventual goal of seeing a more Russian friendly administration in the capital. Do you agree with that and isn’t
that the answer to Ron DeSantis?
KALLAS: Yes, exactly. What is Russia afraid of is democracy is expanding. Not — he’s — I mean, Russia is not afraid that somebody is actually
attacking them military — I mean, their territory or trying to you know, get a piece of their territory. Nobody has plans to do that and nobody has
said anything about this.
But what Russia is afraid is democracy. And because in democracy, you are held accountable for your decisions. When you start a war, you have
soldiers’ mothers on the streets demonstrating. And you can’t do these things that will cement your power the way it is done in autocracies. And
that’s why — I mean, Russian Kremlin are very much interested in this democracy European values not going anyway further because then they might
also reach Russia. And that is already a threat to the powers of Kremlin and Putin.
AMANPOUR: And finally, then, in trying to get an end to this, do you have any faith and President Xi Jinping and China who plans to visit Moscow,
apparently, next week and then to talk to President Zelenskyy, I guess via remote. What do you hope would be the outcome?
KALLAS: Well, first of all, I hope that China, who’s also part of U.N., United Nations, and has agreed to the United Nations Charter, also accepts
and respects the principles of that Charter. And that is that in this war, there’s one aggressor and one victim. One has not done anything to cause
this really.
So, it can’t be that if you preach the U.N. Charter, if you attack another country, you walk away free and you walk away with actually more
territories. I think this is also important for China that they are part of the International Community and also respecting the rule of law, the
international rules-based order that is there in the world. So, I hope that they understand what is at stake here.
AMANPOUR: Prime Minister Kaja Kallas, thank you so much indeed for joining us.
KALLAS: Thank you.
(END VIDEO CLIP)
AMANPOUR: And of course, the stakes are super high. Turning now to another crisis, the banking drama that has shocked the entire global financial
system in the United States. The full impact of Silicon Valley Bank’s collapse is yet to be seen. And President Biden is working overtime to
assure the public the system is safe. But for many, it’s a worrying flashback to the 2008 financial crisis.
Have investors and governments learned nothing from the mistakes of the past? It’s the basis of a new frontline documentary called the “Age of Easy
Money.” Here is a clip from the trailer.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Economic alarms are blaring.
UNIDENTIFIED MALE: The Fed is trying to stop inflation.
UNIDENTIFIED MALE: To those who point to the Fed and say, you ran it too hot. You say what?
UNIDENTIFIED MALE: With the benefit of hindsight, I wish we had tightened it sooner.
JEROME POWELL, CHAIR, FEDERAL RESERVE: While higher interest rates will bring down inflation, they will also bring some pain to households.
UNIDENTIFIED FEMALE: We’re now heading into what will be a new economic era.
(END VIDEO CLIP)
AMANPOUR: The film’s director James Jacoby joins me now along with the economists, Betsey Stevenson.
Welcome both of you to the program. Look, I first want to ask you, Betsey, to give us an economic reality check. As I said, people have — are having
flashbacks to 2008. Is it the same, could it have the same, you know, fallout and impact?
BETSEY STEVENSON, PROFESSOR OF PUBLIC POLICY AND ECONOMICS, UNIVERSITY OF MICHIGAN AND FORMER CHIEF ECONOMIST, U.S. DEPARTMENT OF LABOR: I don’t
think it’s the same. When we look at 2008, we saw, you know, a fundamental problem that just was entrenched through the entire industry. That’s not
what we’re — we saw here.
You know, I think what we’re seeing here should give us flashbacks maybe to the savings and loans crisis because we have something where we deregulate
it. And when we deregulated, we saw excessive risk-taking, and with excessive risk-taking comes an increased threat of failure, and that’s
exactly what we saw in SV Bank. There was mismanagement, excessive risk- taking, finally their clients got wind of it, and as soon as the clients got wind of it, you have a good old-fashioned bank run on your hands.
And we saw something similar happen with Signature. A little bit different of a problem, they over extended in crypto, but at the same time it’s the
same problem, a sort of, excessive risk-taking. And, you know, I think we can really lay the blame for that on deregulation. But I don’t think we
have seen that kind of excessive risk-taking permeate the smaller and mid- sized banks that were deregulated in 2018.
And so, I don’t think this is a systemic problem. And I think that, you know, we’ve seen the Fed, FDIC, and treasury step in and say, don’t worry
about your deposits. We are going to cover them.
AMANPOUR: OK. So, I’ll go deeper into that. But just you said, you know, good old-fashioned run on the banks. So, you think that — you know, a.k.a.
panic, has been staunched and we won’t see it infect other banks?
STEVENSON: I think — you know, there’s two things we have to worry about. We have to worry about the solvency crisis, and that’s where, like, the
banks really messed up and they just don’t actually have the money. And then we got to worry about a liquidity crisis which is, can they actually
produce the cash people want on hand. And are people going to panic and try to get their cash.
I think the efforts that we’ve seen from the Federal Reserve, from President Biden, from the FDIC, from treasury means that people shouldn’t
panic. They can get their money and if they go to the bank and the bank doesn’t have liquidity, it can turn to the Fed which has set up new
measures for banks being able to borrow from the Fed.
So, I think our liquidity problems are contained. And then the fallout will be whether there are broad-based solvency problems in the banking system.
And I think they’re — it’s unlikely that we have broad-based solvency problems that are anywhere near the scope of what we saw in 2008.
AMANPOUR: So, James Jacoby, I mean, you know, your documentary hits — it could be a better time of for, you know, for you to put this out into the
public sphere. Do you, from all the reporting you did in this documentary, are you surprised or did you think that something like this could actually
happen again?
JAMES JACOBY, DIRECTOR AND CORRESPONDENT, FRONTLINE’S “AGE OF EASY MONEY”: No, not surprised. And I think, you know, I think and the people that I’m
speaking too, there are concerns about, you know, certainly how much risk- taking was happening in the banking system and the broader financial system during the, kind of what we called the age of easy money basically, since
the 2008 crisis.
There is certainly a lot more requirements on banks and regulations and there has — there’s been some deregulation and some greater risk-taking as
a result of it. But there are, you know, as interest rates rise, and they are now because the Fed has been trying to fight the inflation problem,
then a lot of the assets that banks hold and, you know, financial institutions hold, their values fall. The prices of those assets fall.
So, there is the concern out there about what banks have on their balance sheets and other financial institutions that aren’t even regulated
financial institutions.
AMANPOUR: So, let’s talk about easy money and I’ll get both of you to comment on this. Because I think you’re saying that this is the name given
to how, you know, the government tried to basically revive the economy. So, you have a quote, amongst many of your quotes and interviews, with Rana
Foroohar who is a well-known economic analyst. She works for, you know, many different medias as well.
She says, one of the things about the age of easy money that is so diabolical is that we’re all in it, right? We’re all part of this Faustian
bargain of pretending that there is something wonderful happening in the real economy, when really it’s just Wall Street going up. So, put that into
context because I remember during the Trump administration, you know, they were always thrilled when the Dow Jones went up as if that was the actual
economy that ordinary people took part in.
JACOBY: Yes — I mean, I think what Rana is referring to there is basically the idea that, you know, the Fed had these well-intentioned
policies to keep short term and long-term interest rates low to basically make sure that there was cheap credit in the economy and the hope was that
the economy would grow as a result of that. For many, many years, we had a sluggish economic growth yet we saw our financial markets really take off
and the price of financial assets and other types of assets really take off.
And I think what Rana is saying is that the Faustian bargain is that, you know, we have 401(k) plans or pension plans. And we want to see those
assets that they’re invested and go up. Yet at the same time, what she’s bring attention to here is this larger trend of the financialization of our
economy. That this was also fueling a greater divide between Main Street and Wall Street.
AMANPOUR: Betsey Stevenson, you have been among many of your positions, chief economist at the U.S. Department of Labor. So, you get the whole,
sort of, government part of this. And you’ve — you talked a moment ago about regulation. This seems to be an ongoing battle that leads to
sometimes, you know, all of this kind of fallout.
So, today, the Democratic Senator, Elizabeth Warren, laid the blame for a lot of this at the feet of Chairman Powell and the Fed.
This is what she tweeted, the Fed Chair Powell’s actions directly contributed to these bank failures. For the Fed’s inquiry to have
credibility, Powell must recuse himself from this internal review.
Can you explain the Feds’ role and do you agree with that, Betsey?
STEVENSON: Yes, I think that that’s a really tough thing to lay at the feet of the Fed. So, the reason why people are looking at the role of the
Fed is the Fed has had to raise interest rates quite rapidly. And that rising of interest rates does change the value of long-term assets where,
you know, you thought that that asset was a great deal, you know, with — let’s just take something like a mortgage. A 30-year mortgage that someone
got with a locked in three percent interest rate. Well, that doesn’t make a lot of sense in today’s world.
And so, if you’re holding that, it’s not worth as much as it was two years ago. But the real culprit there is actually inflation. The real culprit’s
not the rising of rates, it’s the inflation that has led the Fed to need to increase rates. If you are holding a mortgage where somebody was only had
to pay three percent on it but were running 10 percent a year inflation, that asset’s also going to become worth a lot less.
So, the rule — you know, there is this question, as should the Fed have seen inflation coming faster? I think that’s really hard thing to blame the
Fed on. The Fed was one of the first to act in 2020 when they saw the pandemic coming. Yes, there was easing that was done to try to help keep
food on the table for people. I still think that was the right decision. Should they have tightened more in 2021? I think history’s going to go back
and ask that question. I’m not sure they’re going to say the answer was yes, they should have.
But I think one thing we know with is clear right now, they need to slow down and raising rates. And they need to hold rates. So, it’s not about
lowering rates. It’s about slow, you know, a slow but steady sort of increase and a hold.
AMANPOUR: James, to you, I — you know, you interviewed Chairman Powell. You also — I’m going to play a clip in a moment right now about — I mean,
he’s featured in this clip with business reporter Chris Leonard and he, sort of, laid out how we got to this. So, I’m just going to play that.
(BEGIN VIDEO CLIP)
CHRISTOPHER LEONARD, AUTHOR AND JOURNALIST: The financial system globally has been built around extremely low, ultra-low interest rates for 10 years.
JEROME POWELL, CHAIR, FEDERAL RESERVE: My colleagues and I are strongly committed to bringing inflation back down to our two percent goal.
LEONARD: I think people don’t appreciate the magnitude of what the Fed did over the last decade. And so, this is going to be, like, a long-term thing
playing out overtime. Probably over, like, a year or two, of shifting to a higher rate environment and then the correction that that’s going to cost.
So, he’s talking about a huge adjustment that’s not going to be an adjustment upward. Things are not going to get easier. Things are going to
get harder.
(END VIDEO CLIP)
AMANPOUR: So, you know, I misspoke there. It’s not an interview with the chairman but he features quite a lot. So, hearing what Betsey said about
the Fed, what sort of conclusions did the documentary come to the role of the Federal Reserve?
JACOBY: Well, I certainly wish that Chairman Powell had given us interview, he didn’t. But the only sitting Fed official that spoke to us
was Neel Kashkari who is the president of the Minneapolis Fed, and he — it was the second time we sat down for two interview for the — for this film.
And I did ask him that question. I mean, did you — do you think you ran the economy, you know. ran policy too hot for too long? And he said,
basically that given what he knows now, they should’ve tightened sooner.
I think — I — you know, we get into how tough a call that was at the Fed when they started to see inflation ticking up, they referred to it as
transitory. They thought it would pass and that it had a lot to do with supply chains gummed up from the pandemic and other issues that were —
they thought were momentary issues and transitory.
They — there were a number of people saying, you know, in corporate America for instance, companies that were actually seen issues with their
supply chains and other things saying that these issues weren’t transitory. And so, there’s a lot of challenges in the film to Kashkari and the Fed
about whether they could have acted sooner.
AMANPOUR: So, now I’m interested and I expect what a lot of Americans and others who, potential victims of all of this. So, the president started,
apparently, according to stuff that’s come out of the White House. He started by wanting to not be seen to be doing any bailout, Betsey. He said,
apparently, to his people that whatever we do, it can’t be another bailout. We were perceived to have bolstered the so-called fat cats, remember in the
famous words of President Obama?
And yet, there is an intervention. And, you know, a lot of these deposits are going to be guaranteed. Can you explain to us, is this the bailout?
Will the American taxpayer be essentially liable for some of it? And what’s your view on that?
STEVENSON: Yes. So, first, I actually just want to clarify on these, like, 10 years of easy money. I personally go back to 2013, 2014, inflation was
running below the Feds target and a lot of people were out of work. So, if you care about like what’s happening to main street people, I don’t think
that the Fed had money too easy in 2013, 2014, 2015, 2016. It took us 10 years to climb out of the 2008 recession. And I think the Feds should have
been even stronger to help us get out without a recession.
The question now, you know, asking this question about, is this a bailout? It’s not a bailout. Depositors are customers of the bank. They’re not
investors in the bank. That what we’ve been really clear about is, we got to make the depositors hole. That’s just like deposit insurance.
I put my money in the bank and I don’t do my due diligence to investigate how sort of stable that bank is. I think most people of the bank, even
small business owners who might have $400,000 or $500,000 in a bank so that they can pay their rents and their payroll, they’re not vetting the bank.
So, we cap this — the Federal Deposit Insurance at $250,000, but I think that cap is too low. And we probably want to protect people a little bit
more because we don’t want every customer of a bank to have to investigate whether the bank is a good business or not a good business.
A bailout is when you help the shareholders, and they’re not doing that. They’re not helping the shareholders. So, don’t think it’s a bailout. I
think mostly, we’re going to find these banks are solvent enough that the money is there to pay the depositories. That’s why it’s not going to come
from taxpayers to the extent that they are insolvent and that we have to come up with some extra money to give — make sure that the depositors all
get a hunter percent of the money they had in the bank.
We may have to levy a tax on risk-taking in the banking system. But I think that that is still what they’re saying clearly is, that’s where it will
come from. It will come from that behavior. It’ll affect the shareholders of banks. They’ll be ones who pay for it, not regular taxpayers. And who
were making hole is the customer, not the investor in the bank.
AMANPOUR: OK. So, let’s go back to the regulation piece of it that you talked about earlier. Senator Warren also sent a letter to the CEO of this
bank, the SVB. Greg Becker, and she wrote, you have nobody to blame for the failures at your bank but yourself and your fellow executives. You lobbied
for weaker rules, you’ve got what she wanted and used this opportunity to abdicate your basic responsibilities to your clients and the public,
facilitating in near-economic disaster.
So, let’s pick that apart. A, Betsey, is that correct? And what is this business of lobbying for deregulation and then, finding yourselves, you
know, at the sharp end of the problem?
STEVENSON: Well, they should be embarrassed because it’s absolutely correct. He lobbied for something. He said, I don’t need the regulation,
don’t worry, will do the right thing even without the regulation. Then got the deregulation and then, they didn’t do the right thing, right? If it had
been 2017, they would’ve not been allowed to do what they were doing.
And so, that deregulation directly led to this. And I think that’s why Senator Warren is calling to repeal that deregulation, and I think that’s
rightfully so, because it — you know, the head — the Republican head of the Congressional Budget Office said, if you deregulate in this way, we
will see more bank failures. And, you know, ironically — maybe not even ironically, one of the, you know, very people who lobbied for this was one
of the banks that failed
I think this goes to show why we need to limit lobbying because what we have our concentrated interests, we don’t have the customers of banks in
their lobbying Congress and telling them, you got to make sure that the banks don’t fail. That’s going to hurt me, that’s going to hurt all of
society. But you do have the people who — the investors in banks and the people who represent the investors in banks lobbying Congress because risk-
taking means high rewards.
And if we come in and bailout every time they have a loss and they get to keep the rewards, we’re encouraging risk-taking. We don’t want to privatize
the gains and nationalize the losses. We got to make sure that they are not taking excessive risk-taking if we’re going to be bailing them out when
things don’t go well.
AMANPOUR: So —
STEVENSON: And here, I just use the word bailing out, but let me be clear, who were helping. Again, is the customer. I’m not helping the investor. But
what — you know, one — the way markets work is if you’re doing a bunch of risk-taking, the customers, if they can vet you, if they can look at the
risk-taking the bank is doing, the customers should get nervous and pull their money out of the bank. That’s exactly what happened. That’s how we
got the failure.
But I, for one — and I think most of your viewers do not want to be in the business of having to look through their bank’s portfolio to try to figure
out whether this is a bank worth doing business with. You know, if you’re a small business owner, if you are a toy store, what you love is selling
toys, not vetting banks.
AMANPOUR: Indeed. I mean, I know. I mean, who has, yes, the opportunity and expertise to do that. Therefore, James Jacoby, with this documentary,
two hours, it’s airing in this fortuitous time tonight on PBS, what is it that you want ordinary people, viewers, to take away? What are you — what
have you worked for so long for them to come away knowing more about?
JACOBY: Yes. I think, well, one is to understand the role that the Fed has been playing, and something that was alluded to earlier was kind of those
years after the great financial crisis when we had sluggish growth and high unemployment in this country and that, you know, the Fed was — you know,
some call it the only game in town, and that we saw after the 2010 midterm elections and that that government fell even further into dysfunction in
this country where the two parties couldn’t get together to do any sort of major fiscal policy that could lead to longer-term, more inclusive and
sustainable economic growth, whether it be infrastructure or the green transition —
AMANPOUR: OK.
JACOBY: — or, you know, big investment programs.
AMANPOUR: Yes.
JACOBY: And so, I’m hoping that people take away that the Fed is an imperfect tool to be really driving the American economy.
AMANPOUR: All right. We leave it there. Betsey Stevenson, James Jacoby, thank you very much indeed.
Now, we turn to the art of achieving greatness. If you ever wondered how experts in various fields like magic or painting becomes so excellent, the
answer is best-selling author Adam Gopnik’s new book, “The Real Work: On the Mystery of Mastery,” where he discovers how great skills are built by
learning with artists, boxers and even driving instructors. And he’s joining Hari Sreenivasan to discuss the secret of finding perfection.
(BEGIN VIDEO CLIP)
HARI SREENIVASAN, CORRESPONDENT: Adam Gopnik, thanks so much for joining us. Your book is called “The Real Work: On the Mystery of
Mastery.” You know, when people think a mastery, people think of putting in the hours. But what is the real work?
ADAM GOPNIK, AUTHOR, “THE REAL WORK: ON THE MYSTERY OF MASTER” AND STAFF WRITER, THE NEW YORKER: The real work is the term, Hari, that magicians
use and magicians love. And they use it to refer to the person, the magician who really has totally mastered a trick, not necessarily the
person who invented it, not necessarily the person who does it in the slickest way, but the guy or the girl who’s just really got it, can do it
in a way that startles and astounds you every time. And they say, he’s got the real work on that.
And when I was spending time with magicians in the beginning of this book, I fell in love with that term. I just love the way that they would
reference, who’s got the real work? Oh, he’s got the real work. Because it seemed to me so exemplary of the way that we all know who’s got the real
work when we need it. That there is always a kind of — a certain kind of mastery.
You know, I spent a lot of my time as a reporter, and whenever you ask anybody, no matter who it is, a plumber or a painter, who’s got the real
work in your field? Who’s the Willie Mays of plumbers?
SREENIVASAN: Yes.
GOPNIK: — they never have a moments pause, they always have an answer. And we instinctively feel, we know who’s got the real work. So, this book
is about searching for the real work in many different methods (ph).
SREENIVASAN: You know, there is the line, speaking of magicians, it says that, the method is never the trick. Once you’ve mastered the method,
you’ve hardly begun the trick. What’s he mean by that?
GOPNIK: That’s my friend Jamy Ian Swiss. One of the world’s greatest sleight of hand man and one of leading intellectuals of magic, which has
many intellectuals. He means by it, it’s something that’s broadly true, it’s one of the things I learned and learning to drive, learning to draw,
learning to dance, learning to bake, and that is that a degree of technical virtuosity, though it may be essential for your field doesn’t begin to give
you mastery. Technical virtuosity is something that’s very widely spread.
But what he means by it is, is being able to actually do the moves with the card deck, if you’re doing card magic, it doesn’t mean you’ll do anything
that’s astounding. What’s astounding, what makes a magic trick magical is the way in which I or a magician can anticipate what you are thinking. Can,
so to speak, read your mind and know in advance what you think I’m going to do and stay one step ahead of what you’re going to do and everything that I
do.
And that’s true, Hari, right across the board. It’s on something every good actor will tell you or every good comedian that they have to be at least a
second ahead of the audience in the storytelling they’re doing and the joke that they’re making. And it’s that exchange between mines that’s the real
root of mastery, not simply technical expertise.
SREENIVASAN: You know, you’ve got a chance to speak with someone who doesn’t get heard very often and that’s the Magician Teller of “Penn and
Teller.” He’s usually the person who plays the mute, you had a very good conversation with him. And I was intrigued by how he perceived kind of the
intellectual in magic, which I had never thought of until that conversation.
GOPNIK: Well, I fell into the company magician through my son, Luke. He’s one of the characters in the book, who fell in love with magic at the age
of 13. And at first, we were a little reluctant to see him, go all the way down in this rabbit hole, but then we realized that he was learning more,
getting broader, deeper sense of accomplishment from mastering card magic than he ever could from studying calculus and Spanish in school.
So, I followed him down this rabbit hole, as I say, and got to meet Teller. And Teller’s whole point about magic is, exactly as you say, Hari, it’s
essentially an intellectual exchange. It’s my mind, and as I said a moment ago, racing ahead of your mind. You know that I’m going to make the color –
– the card change color. So, that’s going to be enough. I’m going to have make the card change color and suit, or I’m going to have to make it you
sign the card and then, find it in your back pocket instead of mine. It’s the constant kind of arms race of minds that makes magic work, that’s what
Teller was talking about.
SREENIVASAN: You know, you also have a chapter that I think a lot more people can relate to who can’t do a magic trick but that there is mastery
in what many of us do, which is to drive. Explain that.
GOPNIK: Well, I was, if you can imagine it, in my mid 50s before I learned to drive. And I think this may be a unique distinction, I got my driver’s
license, passed my driver’s test on exactly the same day with exactly the same driving inspector as my son, Luke, again, who was just 20.
I went in the car. First got mine. He went in the car, got his. I don’t know how many times that that’s happened. But what’s fascinating for me is
someone who had never driven at all, and that was a huge mountain for me to surmount because I was coming to it so late. But what I learned about it is
that driving isn’t just a technical, isn’t just, again, a mastery of the car, of the technology, it’s a whole enterprise.
You know, we’re constantly communicating with other drivers. I had this great crazy driving teacher, Arturo Lyon (ph), and he would say, just
remember, always give everyone the hand, he said. The hand means bless you. The hand means FU. The hand means thank. The hand means whatever you mean
it to mean. And you’re constantly engaged in that kind of communication with other drivers.
And kind of a miracle, Hari, it seemed to me, I write about is that cars are not terribly difficult to operate but they are incredibly dangerous.
And we have sort of absorb that danger into our systems. And yet, on the whole, we drive without — we have accidents gotten those, but on the
whole, New York City, you don’t necessarily risk your life every time you cross the street because drivers know how to interact with other drivers.
It’s a beautiful example of what’s called a self-emerging, self-governing system.
So, in that way, driving was very inspiring for a democratic imagination.
SREENIVASAN: So, what is it that — you know, the — sort of the masters that you spoke with, what’s happening to their brains when they get to a
level of proficiency or a mastery? Is there an auto pilot? Is there a zone that they get into?
GOPNIK: Yes. And I mean, the — and we have a beautiful phrase for it, Hari, the flow, right? And it’s one of the things that you learn right
across everything that you attempt in middle age. And I hardly mastered these things but I became intrigued by the mystery of how others have
mastered them. Is that everything you try, whether it’s drawing or dancing or boxing, which I took up, begins with a set of small awkward steps that
you have to master, right?
In boxing, it’s keeping your hands up. Throwing a jab and then, throwing a cross. We’ve seen that a million times but we’re not aware that it’s a
learned sequence. And slowly, overtime, whether it’s a dance step or a brush mark or a jab and a cross, those small awkward steps develop into a
kind of seamless sequence. And that’s true right across all the fields, all the mets case (ph) that I looked at, it’s always about a series of small
steps becoming a seamless sequence.
And that seamless sequence comes to sit inside ourselves, and it’s what we call the flow. That feeling of the flow, of absorption is, I suggest, maybe
the best feeling — one of the best feelings we ever get in life.
SREENIVASAN: Yes. You know, when you were learning how to draw, you an option to just sort of walk around and understand art in a different way
with someone who is very, very good at it. And what did you learn during the process of what it takes to be good at something as almost simple or
universal that we all see around us, which is to draw?
GOPNIK: Yes. Well, it was deliberately — you know, it was kind of compensatory, chastening in middle age. I’ve been to my shame, an art
critic, for 40 years, but I never knew how to draw. Now, you don’t have to be a great draftsman to be a smart art critic. But if you don’t understand
at some place in your inner self what it feels like to be able to draw, then I suspect your judgment will never entirely ripen.
So, I went to study with an incredibly old-fashioned reactionary drawing master, my friend, Jacob Collins, who basically hates all modern art, and
I’ve been writing about modern art all my life. And the friction between this beautiful system of shaded, chiaroscuro, line drawing, you know,
staring at a nude body for hours on in, learning to depict every patch of shadow, every little shole of fat on a human body, it was an incredible
form of intellectual discipline for me, and it increased my respect for the great drawing masters, and I learned, again, exactly the same thing, the
way you learn to draw is not by looking at a face and suddenly an epiphany comes down, it touches you on the shoulder and your hand is moving in the
right direction. You learn a whole series of steps.
I learned — you know, Jacob taught me, always do tilts in time. Look at the face of Hari and see — oh, there, you see. You just move your head to
25 minutes to 11, right? I draw that, I’ve made the first step to drawing you. And once again, it’s an awkward schematic, almost childlike depiction
when I do that. But if I make tilts in time, I could begin to ascend to actually being able to draw.
SREENIVASAN: You know, like a lot of people, I picked up baking during the pandemic, and I always wondered, what is it that will separate something
that I make from anybody else if they follow the same instructions, right? If we use the same ingredients and follow it everything down to a letter,
why is it that the person who wrote that recipe down in the first place, the master, so to speak, why does their cookie taste better than mine?
GOPNIK: It’s the key question, right? I have a chapter in the book about baking with my mother, because my mom is, in addition to being a linguist
and a scientist, a great baker. And I wanted to learn exactly that, why wasn’t my bread tasting like my mom’s bread? And what I discovered are two
things. One is exactly as you say, as in everything in life, the secret lies in the slippage between the ingredients and the acts in the recipe.
It’s all the things that you can’t instantiate, you can’t code for, right? That’s exactly where the imperfection, the vital imperfection, the way she
rolls it, the way she knows exactly, to the second, when to take it out of the oven. Those are all things that are instinctive things that we’ve
acquired over years.
The other thing is, I think, very beautiful is that literally one of the things I discovered is that the schmutz, as we say, the dirt and bacteria
on our hands enters, profitably, fruitfully, into the material, the things that we are baking. And the schmutz, the bacteria of baker’s dead for
centuries, is still present in the sourdough starter they leave us. So, in that way, baking — all of the things that we looked at, are deeply human
activities in the sense that what we search for is not strict technical professions but the meaningful signs of human imperfection, the schmutz on
our hands, the vibrato in our voice, the uncertainty in our meter.
SREENIVASAN: Yes. I wonder, in this era, especially with social media and everything, we’re kind of really into the end product, the result, but what
is it that you are saying in this book about, I guess, the value of process?
GOPNIK: It’s a good question. You know, one of the things I learned, and I hope I’m saying now, is that, you know, you don’t have to be a master of
something to get an enormously satisfying feeling of mastery. I give the example in one part of the book that hummingbirds and elephants have
exactly — it turns out this is true, have exactly the same number of heartbeats in a lifetime. They just experience things in different ways.
And in the same way, you know, I’m not a terrific musician. God knows I’m not a great draftsman, and you wouldn’t want to put me in the ring with
anyone except another middle age sedentary short writer. But nonetheless, the sense of satisfaction that I’ve acquired through those accomplishments,
the way that simply the process of them comes to sit inside your body and become a kind of foundation for everything else you do in the vocation that
you practice, in writing, in my case, is I think really profound.
We have a society, Hari, that’s so emphasizes achievement, passing a test, getting into the next school. But really, when we think about our own
lives, it’s the foundation of accomplishment that I think matters most to us. I’m a good writer today because I was struggling to form beetle chords
on a guitar that I had never touched before at the age of 12.
Every time we give ourselves the challenge of mastering something that seemed impossible to us before, we become more assured, more serene, more
accomplished people.
SREENIVASAN: You know, you are not the average bear, so to speak, in that you’ve had a life that where you’ve had curiosity as a license and you’ve
been able to feed that curiosity through doing stories on a number of things. But I wonder, in the process of this book, did it change your
appreciation of kind of the mastery that maybe was all around us that we are not aware of?
GOPNIK: Absolutely. It’s a great question. You know, one moment I had, as my son, Luke, again, was studying guitar and we went to some, you know, New
York cocktail party and there was a band playing way in the background. No one was paying any attention to them. And Luke looked at this poor guy who
had been dressed up in gangster wear and said, guy, dad that guy is a better guitar player than anyone I’ve ever studied with.
So, part of it is becoming aware that there is just so much mastery in the world. I tell the story in a book, it’s a story that I love, about how
there was this famous chess playing automaton in the 18th century called the turk (ph), which was really just a magician’s illusion. And they had to
find chess players to sit inside the cabinet and manipulate the hands of the ottoman figure.
And what was so cool about it is, is that they didn’t have one great chess player or somebody who did it all the time. Every time they went to a new
city, these magicians would go to a chest cafe and say, is there anybody here who needs a gig and doesn’t mind close working conditions? Mastery in
that sense is very far spread out.
And one more thing that it reminds us of is that the people we think of sort of the ultimate masters, the best in any field, those Willie Mays
people we were talking about, they tend to be people who have discovered some vital form of imperfection, you know? That’s a beautiful thing about
blues singing or Jimi Hendrix’s guitar, it’s the degree of distortion and imperfection that they discover that liberates our own imaginations.
So, there’s this wonderful dialogue between technical perfection and meaningful imperfection that I think is the real sign of mastery.
SREENIVASAN: How much of mastery is time, repetition, experience? I mean, we’ve heard that idea that it takes 10,000 hours to become a master or
something or good at something, but not all masters or not all people that reach exceptional skill at something have necessarily put in that 10,000
hours in that skill.
GOPNIK: I think it’s — look, it’s a complicated dialogue, right, between what we properly call it natural talent, because we all know what that is.
You know, we all saw the one kid in fourth grade who could draw like a wizard, that girl has a different set of talents than I do. But at the same
time, we all also know that almost everything is susceptible to perseverance and effort.
You know, Miles Davis maybe the greatest jazz trumpet player, was not what anybody thought of as a terribly talented jazz player when he first came
up. But his musical imagination was so exacting and so original that he could glom onto find new ways of playing all the time.
You know, talent is a real thing. Picasso was insanely talented draftsman, a draftsman of genius. Cezanne was not. Cezanne just had his genius. And if
Cezanne were at your shoulder telling you were to make every mark, you and I could do it. We couldn’t see it adequately, but we could do it. And
again, it’s that dialogue between imagination and technical virtuosity that we recognize as art.
SREENIVASAN: Do the masters you’ve spoken with think that they are?
GOPNIK: No, in my experience, Hari, perpetual dissatisfaction is the surest sign of actual mastery. I’ve never known anyone who is really good
at something, and I’ll include myself here, who thinks that they are — you know, who thinks that they’re finally very good.
I wrote once about a great winemaker that — who is always dissatisfied with the wine he makes, is that we can — we all judge other people by the
scale of their accomplishments. But they judge themselves, as we judge ourselves, by the original scale of our ambitions. And the space always
between our ambitions and our accomplishments internally is enormous no matter how big those accomplishments are.
So, I would say that perpetual unhappiness with the scale of your accomplishments compared to your original ambitions is the surest sign a
mastery.
SREENIVASAN: Author Adam Gopnik, the title of the book is “The Real Work: On the Mystery of Mastery,” thank so much for joining us.
GOPNIK: It’s a pleasure talking to you, Hari.
(END VIDEO CLIP)
AMANPOUR: Interesting. And finally, towns and cities across Japan are turning pink as cherry blossom season gets underway. The blooms are a
highlight of every Japanese springtime and they in millions of tourists.
This year, the flowers bloom 10 days ahead of schedule. Beautiful but worrying warn the meteorologists. They say the unusually warm temperature
is partially driven by climate change are to blame. But for a few months, visitors can bask in Japan’s signature season.
That’s it for now. Thank you for watching and goodbye from London.