Is Democracy In Peril? Yes.


NewCo Shift Forum 2018

Four world leaders discuss the fate of democracy in North America. Put bluntly: They’re concerned.

Left to right: John Heilemann, Jorge Fernando Quiroga, Vaira Vike-Freiberga, Luis Almagro and Esko Aho

Partnering with the World Leadership Alliance-Club de Madrid, the largest forum of former democratic leaders, the NewCo Shift Forum convened a two day workshop in February featuring world leaders from Canada, Uruguay, Latvia, Bolivia, and Finland. Four of them then joined us on stage at the main conference for a captivating conversation, hosted by John Heilemann, on the state of democracy in the United States. Given the warning on this very topic delivered by former Secretary of State Madeline Albright today, this conversation feels ever more timely.

Below is a transcript, edited for clarity, and the video of the event. I introduce the topic and the speakers first, then hand it over to Mr. Heilemann for the dialog.

John Battelle: Let’s talk about politics, shall we? These are all extraordinary people and as we reset behind me, I want to set the scene. For the last two days, we’ve had a roundtable here at the St. Regis with the Club de Madrid World Leadership Alliance, which is a nonprofit in Europe that is the largest membership organization of former world leaders of democratic republics.

I ran into a friend who was connected to them, and he said, “Would you like some of them to show up at your conference?” I responded “Oh, yes, please. Former world leaders? I’m in!”

What was really interesting is that the Club de Madrid has a program around the world where members discuss the future of democracy, called the Next Generation Democracy. They’ve never done a roundtable on this topic here in the United States, because most of the time they would focus on areas where democracy was fragile, newly emerging, or imperiled.

When I spoke to the executive director of the Club de Madrid, she told me that they were considering doing one in North America now, and that perhaps democracy is, as one of the members said during a round table, a fragile flower that needs cultivation. Perhaps we should think about that here in North America.

We spoke about that for the last two days here. It was a fascinating conversation. I’m very pleased to bring up John Heilemann and the former world leaders who have been part of this conversation. Esko Aho, the former prime minister of Finland. Luis Almagro, the general secretary of the Organization of American States and former financial minister of Uruguay. Jorge Fernando Quiroga, the former president of Bolivia. Vaira Vike-Freiberga, the former president of Latvia. And of course, my partner, John Heilemann, who is running most of the political conversations this conference.

Please join me in welcoming all of them to the stage. Welcome.

John Heilemann: This is the definition of a global power panel. We have two ex-presidents, one ex-prime minister, and one current secretary general. I’m in awe of this group. Luckily, I did not have to pronounce any of their names. That’s one of my contractual rights here. I’m going to be referring to you all either by your first names or by your initials, because VVK I understand is the…

Vaira Vike-Freiberga: F.

VVF is the right way to…I’ve even screwed that up without even having to pronounce the name. It’s not a sign of disrespect, but merely a sign of my own inadequacies when I do that.

We are going to talk about a big topic as the way to start and kick off a couple days of discussion of politics and policy and business and how they intersect. The title of this topic, which talks about whether democracy is in peril, is a topic that you all have been discussing in various ways over the course of the last two days as the club de Madrid has been meeting. I want to start with this question and I’m going to start with VVK on this matter.

VVF, if you will.

VVF. I did it again. I have to figure out some kind of an anagram for that.

Call me Vaira, It’ll be much simpler.

Probably. John mentioned earlier, he was talking about China. I just want to read to you something that was when we got this news about President Xi. The New York Times coverage of it began with this observation.

“The surprise disclosure on Sunday that the Communist Party was abolishing constitutional limits on presidential terms, effectively allowing President Xi to lead China indefinitely was the latest and arguably most significant sign of the world’s decisive tilt toward authoritarian governance often built on the highly personalized exercise of power.”

That is a sweeping statement to say that the world is now trending towards authoritarian governance. True or false?

VVF: We had an opportunity to meet President Xi last November 30th, a half dozen of us from the Club de Madrid, the World Leadership Alliance.

At the time, President Xi was already in a very good mood. The 19th Party Congress had enshrined Xi’s thought into the Constitution and tasked all members of the Communist Party, the whole hierarchy, to think about it, to digest it, and to explain it to their subordinates all the way down the hierarchy.

It was quite evident that his intention is to have that thought turn into action. At the same time, his rhetoric is not aggressive. When he talks about the Belt and Road Initiative, he sounds like a benign godfather, who is ready to collaborate with countries big and small, and not from a position of strength, but from a dialogue and win-win situation. That is the rhetoric, the actions. They remain to be seen.

Jorge, I ask you this question. However things play out in China, is the trend towards authoritarianism across the globe? Is democracy, in some global sense, in a greater degree of jeopardy than it has been in our recent memory?

Jorge Fernando Quiroga: John, thank you. It depends on where you are. China has a single party system that controls all the media and social media. This change will probably affect the system by which they establish the pecking order, succession, and transfer of power.

I’m going to stay in the Americas. I think there is one place where authoritarian has not only been creeping up, but it’s outright front and center, in Venezuela. The country that had Bolivar, the liberator of several of our countries is now, an enabler, under the possibility, after having destroyed its economy, of having a full second Cuba installed in the midst of the Americas.

That is a premier issue in our part of the world. Is there a tendency that can happen somewhere else? Yes, but generally speaking, democracy in the Americas, with an exception that I mentioned and some other ones, free and fair elections, independent institutions, free press, do an opposition without being thrown in jail, and term limits has been applied as part of the OAS Democratic Charter.

Luis is the one that is charged with overseeing that. Generally, all of those things are there, but we have exceptions. I would submit that the premier hotspot right now in the Americas is Venezuela because that is well beyond populism. It’s an outright narco-tyranny that can be set up in the Americas, while we watch, in the year 2018.

Luis, is democracy in peril, yea or nay?

Luis Almagro: No. We have to have hope and faith in democracy. Of course, we can’t take democracy for granted. We have to work at it every day. There are challenges in the continent, and there are challenges out of the continent. To foresee what we can do to make the systems work better, that is our concern in the Organization of American States.

Democracy’s a process. We’re never at the end of that process. We are always building democracy. We are always building access to rights and equity. We are always trying to take people out of poverty and try to bring them into a political system where they can participate.

I am very positive that democracy has a bright future, but we have to make it work every day. We have to eradicate bad practices. Bad practices are very contagious, are bacterial diseases that spread very fast, because you don’t need projects. You don’t need financing. Bad practices are just passed from one country to the other without any kind of project.

We work to eradicate bad practices at the same time we keep building better rights for more people. At the same time, we are doing the system to work better. At the same time, we are eradicating these bad practices. I think the future for democracy is good.

Mr. Prime Minister, you look at Xi, you look at Erdogan, you look at Putin. These are some pretty big countries with some pretty authoritarian leaders. All three of your co-panelists right now seem more optimistic than the New York Times does in interpreting this move in China. What say you?

Esko Aho: I think we made a mistake after 1991 when the Soviet Union collapsed and the socialist system in Europe collapsed, “now democracy has won.” We all know what happens when you are overestimating your capacities. There is going to be a way to problems.

Now we have faced rather substantial problems, not only in Europe but here in the United States as well. Democratic institutions are not working like they should. Trust in democratic institution is on the low level.

Sometimes, democracy is like health. When everything goes fine, we don’t give any value for that. The day when we are starting to recognize that something goes wrong, hopefully, also with democracy we start to understand that we have to work for that. We have to improve the performance of democratic institutions.

I’m optimistic as well. I believe that we are able to improve our efficiency and democratic systems. To be honest, we are now challenged.

I’m going to ask you a question now. This audience is almost exclusively, not just American, but United States, North American. I want to ask and take this question and put a very fine point on it. Hopefully, I will at least one of you in trouble with the president of the United States by asking. He will be watching right now and monitoring closely. Everybody watch President Trump’s Twitter feed.

Last week, Tom Friedman at the New York Times wrote a column. He felt compelled to do this even though it was not his time to be in the newspaper. He went home and wrote this column in a bit of a fever and posted it on the Web. It went crazy viral. It became the most read Tom Friedman column of all times, and one of the most read columns in the history of the New York Times.

That column began with the sentence, “Our democracy, meaning the United States, is in serious danger.” It ended with the sentence, “The biggest threat to the integrity of our democracy today is in the Oval Office.” I’m pretty sure that’s a reference to Mr. Trump, and not to Hope Hicks or Jared Kushner.

I ask you all, none of you citizens of this country, but all close observers of it. We can’t recapitulate the entirety of Friedman’s column, but on the question of the health of democracy that you see here in the United States right now with President Trump in the Oval Office — I’ll start with you, Jorge — are we in trouble?

JFQ: If you want to switch places, be my guest. It’s not so bad. I come from a place where we are in real trouble. We’re copycats of Venezuela. I know that you can complain for a long time. If you want to get me in trouble and deported, I’ll say the following about the US.

Generally, in Latin America we’d always be asked (about a US election), “Which one do you prefer, Democrats or Republicans?” I would ask for the blender. Generally speaking, Democrats were more open to our people, not our products. Republicans, generally speaking, were open to our products, not our people. Lo and behold, here we are. I got the blender. [laughter]

For the first time ever, we have someone who doesn’t want our people or our products. That was a heavy-duty campaign platform. [laughter][applause]

I’m going to be deported now. It hasn’t been delivered on, but it’s certainly worrisome, particularly if you consider that in 2018 we have a heavy-duty election cycle in Latin America. In Mexico, Brazil, Colombia. We have elections. We’ll see what the denouement of what at least was proposed in the campaign, vis-à-vis trade and migration.

It is difficult. I almost got in trouble one time. I came to express those concerns. I was asked at a fine American university to not name any names. I did not. But I said I was worried about T-R-U-M-P, a proposal based on taking out — deporting — 11 million Latinos, remittances that could be seized in the U-S-A, and the “Muro,” the wall, the first one in the history of humanity that has to be paid by the aggrieved party — the Russians were nice enough to pay for their own wall — and P, protectionism.

I think it is a worrisome agenda and it could create friction. The sad part is, it comes at a time when in this city you have American leadership of the corporate kind that is admired in Latin America. The soft power that’s represented in rooms like this, the low cost of energy, the integration. There’s plenty of opportunities.

But I think Winston Churchill was always right. America will always do the right thing after exhausting all the other alternatives, so, hopefully, you will [laughter [applause]

Whoever’s doing security in the back, tell the ICE agents to wait until about half an hour. Then he’ll be free at that point. Luis, I’m going to stick with you, just to stay in the Americas. I’ll get to the Europeans in a moment. Trump, how big a problem for the state of American democracy, if any?

LA: The article you referred to refers specifically to the involvement maybe of Russia in the electoral process. Then we have to talk about the electoral integrity of any process in the continent, especially in the United States. So far, we don’t have enough elements in order to have a definition like the one you’re trying to have.

What I’m trying to say is that, for us, for Latin Americans, it is always a challenge. First of all, we are experts in foreign involvement in our elections [laughter]

That is a trademark of the continent. Second, our situation always, when there is a new American administration, is to re-adapt to accommodate the best possible that we can do, always trying to help, if possible. If not, we try to defend our interests in the best possible way. In fact, what we have is that the new administration doesn’t have such a distance with the previous administration.

Maybe, the speech is a little bit more rhetorical, but the Obama Administration deported more people than any other previous administration in the United States of America. Already it’s 600 miles of wall that costs the lives of 500 Latin Americans every year. Those are facts. They have always existed, and they are there.

On the contrary, what we see with this administration that they have been very committed to defend democracy in Venezuela and in Cuba. So far, that is a partner in order to reveal some democracies in the continent. I hope they will stay committed to that. In fact, my first option is always trust and move in that direction.

Vaira, I want to ask you this question. Trump does not exist in a vacuum. His election was surprising to a lot of people, including me. It’s the case that we are seeing around the globe, in Europe and elsewhere, an uprising of a certain kind of politics that’s populist politics, nationalist politics, protectionist politics, often nativist politics.

This is not a uniquely a Trump phenomenon. It’s happened in France. It’s happened in other places. Generally, not leading to someone capturing the presidency or the prime ministership, but there’s these movements that we see in many Western advanced democracies.

What explains that, at this point in human history, that suddenly those kinds of attitudes and that kind of politics seems to be finding traction in so many advanced, Western, rich democracies?

VVF: I would say that we should consider them seriously as symptoms of an underlying malaise. People will not follow leaders that promise them the sky and then don’t even give them the ground to stand on if they didn’t feel insecure on where they’re standing.

I think Prime Minister Aho was quite right that the end of history that we thought, with the collapse of communism on the European continent, did not mean that there was a definitive victory of democracy in the world, that we could all go home, relax, and do nothing about it.

The only thing that is new is that it seems an American White House is taking lessons from a neighbor of ours, with whom in my country, Latvia, we have had certain sad experiences and disagreements. We usually look to America as, well, the light upon the hill, the place where democracy has been around for a long time, which can serve as an example.

If now they’re taking lessons from a vertical consolidation of power in other countries or allowing them to influence both public opinion and public action in America, then, of course, it’s alarming to Europeans, also.

We usually look to America as, well, the light upon the hill, the place where democracy has been around for a long time, which can serve as an example.

If now they’re taking lessons from a vertical consolidation of power in other countries or allowing them to influence both public opinion and public action in America, then, of course, it’s alarming to Europeans.

Mr. Prime Minister, I want to ask you this question, just to take this into the heart of this conversation that we’re having this conference here. For most of the post-war era, business’ corporate sector was a part of the post-war consensus about how progress would happen.

We had big multilateral and multinational institutions that were promoting free trade, free minds, free markets, democracy, and so on. Companies were aligned largely with governments in industrialized countries and advancing all those causes.

We now have a different situation where, because of the populist impulse, the nationalist impulse, the protectionist impulse, those are symptoms, as Vaira just said, of a bigger phenomenon and one that has caused a lot of voters, a lot of ordinary citizens in a lot of places, to come to profoundly distrust the corporate sector.

It’s also been driven to some extent by income inequality, plutocracy, and kleptocracy and some of these phenomenon that we see around the world. I ask you this question for all these civic-minded business people largely who are in this audience. What does the business sector do now when it is distrusted, but it wants to obviously participate in a way in strengthening democratic institutions and democratic norms?

How does it deal with that conundrum that it faces, that a lot of citizens look at businesses and say, “Hey, stay out of our democracies, guys?”

EA: May I first very briefly comment on this Trump administration’s, let’s say, role?


EA: I don’t remember who was that American political leader who was criticizing Europe by saying that we don’t know to whom to call if you want to reach Europe. Was it…


EA: It was Kissinger. I think that in Europe, we are thinking roughly in the same way today about the United States, to whom to call in order to understand what’s going on in this country. [laughter]

To this very critical question about the role of business, I’m coming from a small country, Finland. We are extremely open economy. We are extremely dependent on global trade and global business. Our guarantee for us is that there is trust in a rule-based system in the world. I believe that the United States has become rich politically powerful just because of the fact that it has been like an anchor of a rule-based system in the world.

Now, I think we are a bit concerned. Is America changing its course? If it’s doing so, it’s not only bad for America, I believe, but it’s going to be bad for the whole Western world. That is what I am worried about.

By the way, my last message, I’d like to encourage business community to speak loudly and to take a stand. I have seen American companies to participate in political discussion in China. It was a bit of a exciting experience. It was China’s Development Forum. Maybe 40, 50 global major companies were there. I was representing Nokia there. American business leaders were teaching Communist Party leaders in China how to become more social. They have to invest more in pension systems, social security, and to take more care of the rural part of China. I haven’t seen American companies educate their own government yet, but I hope it will happen. [laughter]

American business leaders were teaching Communist Party leaders in China how to become more social. They have to invest more in pension systems, social security, and to take more care of the rural part of China. I haven’t seen American companies educate their own government yet, but I hope it will happen.

Luis, let me ask you the about this. Obviously, there’s a critique of how capitalism snaps together with policy and politics in this country. Many people focus on money. This is obviously a system, particularly in our campaign system, where there’s an extraordinary amount of private capital that flows into the system, and people want reform of various kinds.

There are people who sit in other countries, who look at the US and say, “This problem is a problem, but it’s not as great a problem as the more clandestine secret corruption that you see in a lot of other countries around the world.”

Just talk a little bit about how money works across American politics, but North American politics, South American politics, and how to deal with that, how a properly functioning democracy deals with the influx of capital from businesses that want something for their dollars.

LA: Our countries in the continent, they are much more aware these days that the way that politics are financed can completely corrupt their political system. We have a set of new laws, practically in every country in the continent, about how to finance political parties — the limits that they should have, how political campaigns should go, and how the system should operate.

I think we have some challenges ahead, but we are in a much better position than some years ago. Some years ago, we had Odebrecht and PDVSA corrupting practically everybody in the continent, and we were pretending that everything was fine. That is a bad practice that we are starting to eradicate, and somehow it’s working.

The civil society is much more aware and they have better tools in order to fight against corruption. They have better tools in order to fight against the money of organized crime in the political system. They have better tools to control the interest of companies and how they finance the elections of political parties.

We are trying to find a good set of rules that may allow us to make our democracies stronger. We are coming from a very bad period, that is that period of PDVSA and Odebrecht, but we are moving forward and we are leaving that in the past.

All those that have received money, they have been jailed or prosecuted in most of the country. It has been a very painful experience, but is a very, very good experience, in the sense that we are cleaning our political system and we are better preparing them for the future.

Vaira, when you look at the way that companies and government relate to each other in Europe, versus the way the companies in government relate to each other in Americas, but particularly in the United States of America, what do you see as the differences? What can America learn from Europe in that respect, if anything?

VVF: The business practices in a capital system have certain fundamental rules that are much the same. Seeing an organization, such as the one that we’re sitting in front of, I would say that there are certain elements that are changing. You just had somebody from the Bill Gates Foundation.

There’s an outreach that goes way beyond what normally businesses everywhere in the world are concerned about, and that is making money. It was believed for a long time that as long as businesses made money, they would contribute to the good of society.

Any number of social movements in the past decades have shown us that tobacco companies and their lobbies were responsible for millions of deaths a year from lung cancer and other diseases.

Rachel Carson, way back with Silent Spring, pointed out how large chemical companies manufacturing pesticides were making great profits and doing great as businesses, but poisoning the environment not just for existing generations, but for future generations.

That concern of the unintended side effects of successful businesses remains the same, both in Europe and in America. The means by which they react, Europe does go in for more regulation. America is much freer in that respect.

Civil society has, in a way, done much the same as regulations in Europe by calling companies to account when the unintended consequences of their making money and profits for their shareholders are such that they cannot be considered a public good, but quite the contrary.

Jorge, let me focus on a specific thing that we’ve already started to talk about here today with Google and that we’re going to talk a lot about over the course of the next couple days, which is social media.

In this country, there’s a very new phenomenon happening right now, which is a backlash, to some extent — in some cases, to a large extent — against the social media companies, whether that be Google, Facebook, Twitter, Instagram, YouTube, or the various divisions of these giants and the role that they are playing in our democratic discourse.

There are some unintended consequences, some intended consequences. Give me a sense, as you look at this unfolding here and on the global stage, whether you think at this moment…Let me put it this way: I don’t think government is equipped to deal with this. It hardly ever is equipped to deal with rapid technological change.

How ill-equipped do you think government is? What does government need to do to start to address some of the negative externalities that we are seeing play out because of the pervasiveness of these social media companies in our civic discourse?

JFQ: Two points on this that we ought to be careful about. One is when people say where did the populism and the backlash come from? From here. You’re “Ubering” and not taxiing, you’re “Airbnbing.” There’s massive tectonic displacement thanks to innovation, and we will live in a different world.

You cannot blame Amazon or high tech or robots for what’s happening, so it’s easier to blame the Mexicans in the US or the Muslims in Europe. That won’t go very far, but that is certainly one issue on the table.

The second is social media and the impact it has clearly changed everything. It’s changed the way you do politics, you do campaigning, and what have you. My only point of caution will be the following, John, because I’ve listened to a lot of talk about how the Russians, they did this and they’re gaming the algorithms and we’re going to regulate them and clamp down.

Think of the following. Frank Sinatra rules apply. If you can make it in New York, you can make it anywhere. If you can regulate it in the US, it affects us everywhere else. Let me tell you, there’s a lot of authoritarian dictators that would love nothing better than clamp down on tools the democracy activists have intensely used, whether it’s Instagram, YouTube, Facebook.

Any Venezuelan democracy fighter walks around with a (selfie) stick and three cell phones, so they can Facebook Live, they can YouTube, they can Periscope. Without that, they would have no way of even putting any complaints out. The most retweeted man in Venezuela is Luis Almagro. His reports, that’s the way they get them, not through traditional media. If you’re going to regulate, think of the two extremes.

I’ll close with this. Let’s suppose Finland — open, trustworthy, traditional media, open social media. Let’s take China on the other extreme. The state runs everything, the traditional and the social media.

Somewhere in between, there could be the temptation of saying, “Oops, I am going in the US, regulate social media out the kazoo. Beware of the fact that you could have authoritarian dictators saying, “Oh, if the US can do it, if you can call CNN fake news, then I can kick them out in Venezuela.”

Whatever rules and regulations, there’s got to be a government and a social media company, but please always think that whatever decisions get made here can be applied and interpreted in a totally pernicious way somewhere else. What you’re going to do here is going to have contagious effect, so think of the rest of us when you’re making rules and regulations for social media.

What you’re going to do here is going to have contagious effect, so think of the rest of us when you’re making rules and regulations for social media.

Esko, I ask you this live. We’re going to get to a question from the audience here real quick, but I do want to come to you just because you had this role in Nokia. You’ve been someone who’s straddled the line between business, politics, and technology.

It seems to me that the model of largely self-regulation, these companies in the social media space are now so large and so powerful that they will not be able to evade regulation in the way that many companies in the Silicon Valley have for a very long time. There will be more regulation of these businesses.

The question is, as Jorge has pointed to, there’s going to have to be some collaboration between business and government. There’s going to have to be balances that get struck. What’s the sweet spot there, especially as the rest of the world looks, as Jorge also said, to America to provide an example for how to find the right balance?

EA: This is an extremely important issue. I’m also reading the New York Times. A year ago, there was an article saying, “Tech giants see governments as biggest threat.” This is a fundamental mistake. Until now, when these companies have been doing mainly entertainment on social media, I understand that governments are not that relevant. Maybe they are even irrelevant.

If and when we are moving to real economy applications, we are trying to digitalize traffic and logistics, financial services, health care, manufacturing, education, how come you can do that without having collaboration with governments? It’s necessary to work with governments. Every company that is able to work with governments will make profit as well.

Secondly, I believe that companies have to be worried about the state of democracy as well. It’s very important to understand that there is not going to be sustainable, good business if democratic systems do not work properly.

JH: I was going to go on and ask the audience to ask some questions, but we appear to have run out of time, probably because someone on the next panel has a hard stop at the end. I’m going to have to say that’s such a brilliant ending. It was so perfect. We just want to end right here.

If anybody has questions for any of these potentates, you can catch them outside because the ICE agents will be detaining them as they try to leave for their criticisms of President Trump. Let’s give them a hand.


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