Remarks at the Trillion Dollar Challenge Event at the Concordia Summit
Deputy Secretary of State
Well, good afternoon, and thank you very, very much. Anne-Marie, thank you for the very kind words of introduction and especially for your superb leadership at New America. One of the privileges of my service and time in government has been the opportunity to work with Anne-Marie when she was there. And we’ve not just been colleagues; we’ve been friends and she’s been an extraordinary counselor.
I also want to recognize at the very outset Tomicah Tillemann for his extraordinary work in pioneering the Bretton Woods II Initiative that has brought all of us together today. And it is truly a pleasure to take part in Concordia Summit. I’d like to thank its founders and organizers for focusing tomorrow on the global refugee crisis. Nothing today demands from us greater compassion or ingenuity.
So this week, as a few of you may have noticed, world leaders are gathering in New York, no doubt to the delight of actual New Yorkers, for annual meetings on the great political, economic, and humanitarian questions of our time. Every year that I’ve been involved in this, the stakes feel higher and higher. This year, our gathering is set in the midst of one of the most significant global debates that we’ve seen in decades about foreign policy. It doesn’t pit left against right, Democrat against Republican here in our country, liberal against conservative, or even urban against rural. Rather, the fault line that we’ve seen emerge is between those who would erect walls and those who would build bridges.
In the shadow of shared vulnerabilities exposed by the dizzying pace of global change, some of our fellow citizens here in the United States – and we see this, of course, around the world – are questioning the merits of facing outward, of being open to the world. They worry that refugees pose a threat to their physical security and immigrants to our identity; the free trade agreements are benefiting everyone except for them. They don’t believe that policies or investments are being made with them in mind.
Here in the United States, these concerns are reflected and amplified by election year politics. What value can there be in a system that they feel has left them behind? This debate has its roots in very legitimate concerns. But there can also be no doubt about the danger of it in its extremes, because the bridge builders are right – for all the violence, all the tragedy, all the hardship that persists, the world overall is enjoying an unparalleled period of peace, prosperity, and progress.
And this is not the result of chance or luck or providence. It certainly isn’t the result of turning inward. This trajectory of human progress traces its roots to decisions that were made seven decades ago. Out of the rubble of world war, the pain of unfathomable national loss, our predecessors wrestled a fundamentally new course from the currents of history. They resisted the temptation to concentrate the power in the hands of victors or to turn their backs on a broken world. Instead – and you all know this so well – they built an international system of institutions, of rules, norms, principles that gave everyone a voice and a vote in the running of world affairs. Their purpose, of course, was to prevent for all times a return to war between and among the great powers, and to create a safe, stable environment in which countries could progress to the benefit of more and more of their citizens.
This environment of stability and security set the conditions for business and commerce to thrive in an open global economy whose rules and standards are not only fair, predictable, known, but also reward transparency, innovation, and plain hard work. Of course, this system did not eliminate all turmoil, all conflict, all inequity; it did not. It could not insulate societies from the pain of social and economic change.
But standing at a remove of 71 years, I think it’s fair to say that it got the big picture right. Indeed, with all of the chaos and complexity that we face today, it’s easy to forget a truly incredible fact: We have the wind at our backs. Progress is lifting billions of people out of poverty, extended the mantle of democracy to more people than ever before, created new middle classes, new consumers from the Americas to Africa to Asia and beyond.
Here in the United States, the poverty rate has fallen by the largest percentage in nearly 50 years. The gender pay gap has narrowed to a record low. And middle class and poor Americans have enjoyed the largest increase in median household income in nearly five decades, broadly shared in both urban and rural communities. Overall – overall, people are healthier, wealthier, better educated, and more tolerant than at any time in human history. As President Obama has said, if you had to choose any moment in history in which to be born, not knowing where, not knowing what your race, gender, ethnicity, religion, or sexual orientation would be, you would choose today.
So the question that we have to ask ourselves is: What explains this discontent, the self-doubt, the fear, the confusion about, indeed the rejection of the very system that helped produce unprecedented progress in the first place? There’s no simple or single answer. For me, at least, part of it starts with the information revolution, which of course has been in and of itself a tremendous boost to human progress, equipping students with a global library, giving farmers real-time climate data, empowering citizens to hold their government accountable. But that same flow of information – its abundance, and sometimes, I think all of us feel, overabundance – also fuels a sense of chaos and confusion.
When I worked in the White House in the 1990s, everyone across Washington did two things and shared two experiences. At around 6:30 p.m. in the evening, everyone stopped what they were doing and turned on the national network news on CBS, ABC, or NBC. And then in the morning, we all opened our front doors and picked up a hard copy of The New York Times or The Washington Post or The Wall Street Journal. Everyone did that. And now, of course, we’re hooked up to an intravenous feed of information and locked in an infinite echo chamber that tends to reinforce our own beliefs and crowd out, not bring in, different perspectives. In this environment, the bridge builders are not the strongest or loudest voices. We struggle to be effective, to be confident, to be compelling enough. We argue facts, not emotions, and sometimes we fail to connect large concepts, like international trade agreements or multilateral diplomacy, to the tangible benefits that our fellow citizens enjoy.
But those who feel left out and left behind have legitimate concerns, valid objections that make them more and more susceptible to the siren call of those who would build walls and bolt the front gates. If we believe in the value of an open world, then it’s our responsibility as political leaders, government leaders, economic leaders to do a better job extending the benefits to more and more people to ensure that they have the education, that they have the skills, that they have the access to capital that’s truly needed to compete and succeed in this world. I believe the bridge builders have to prevail. We simply don’t have the luxury as nations, as corporations, or as individuals to go at it alone, to divorce ourselves from the fortunes and fates of people around the world.
The unparalleled scale of global connectivity incentivizes new forms of cooperation. It opens new markets. It makes it easier and faster to share knowledge. But it also exposes us to new vulnerabilities, especially for our economy. And time and again, we’ve seen the butterfly effect at work. In just a single city or village, the outbreak of a disease, the start of a protest movement, a terrorist attack can have repercussions halfway around and all the way around the globe. When an epidemic spreads, it disrupts supply chains and forces societies to redirect precious resources from other endeavors. When children are denied an education, women their equal rights, our economies as a whole suffer because we deny ourselves ideas, workers, consumers. When demand for a bribe goes unchallenged, it stymies growth, undermines trust, denies citizens their basic aspirations – a cycle that ultimately destabilizes markets and topples governments.
Today’s global challenges are so immense, so complex that the ingenuity, the tools, and the resources required – in the trillions of dollars – are simply beyond the capacity of any single national government, organization, or actor alone. We need state and local governments, international corporations, startups, NGOs, universities, faith-based leaders, innovators, to work together on new solutions.
And now we have a starting point, a consensus on the challenges that we need to tackle. With U.S. leadership, the Sustainable Development Goals agreed to here in New York last year set clear targets for 2030. These milestones apply to every country. They include oceans and the environment. They will be measurable in real time. On even the most intractable of global problems – extreme poverty, maternal health, child nutrition, gender equality – we have made enormous gains, but there is so much more that we can and must do. We need to pursue policies and investments that ensure that the benefits of this open world truly extend to all people in it.
It’s not just a good deed; it’s good business. Investment indexes made up of firms that have high standards of governance, environmental stewardship, and social responsibility are delivering strong returns and low levels of volatility.
Many of you here today represent funds and companies that are big enough that you don’t actually have to accept the world as it is. You have some ability to tip the scale, even just a little bit, against any one of these global issues and improve your bottom line at the very same time. You can tip the scale for young people, especially young women, giving them opportunity and education and the skills that they need.
Across the developing world, 60 to 65 percent of people are under the age of 30, 50 percent under the age of 21, 40 percent under the age of 18. What we do today, what you do today, will determine whether this young cohort emerges as an engine for growth and progress or becomes lost to child labor, trafficking, early marriage, and even terrorism.
You can tip the scale for displaced people and refugees. Two decades ago, the average crisis lasted nine years before refugees could return to their homes. Today, these crises last, on average, 26 years and counting; 26 years of lost schooling, lost wages, lost livelihoods, lost knowledge, lost culture. We can’t continue to address these protracted crises only as humanitarian emergencies. We have to build longer-term public-private development partnerships that only meet the needs of refugees, but also the communities that are taking them in. When refugees and immigrants are demonized as terrorists and criminals, and turned away by barbed wire at borders, it walls off one of the single-most creative, productive pools of talent we have. In fact, more than 40 percent of Fortune 500 companies were founded by immigrants or the children of immigrants.
This is not just about corporate philanthropy. It’s about harnessing the skills and ingenuity that lie underutilized in populations on the move. This approach works, but it requires commitment. That’s why we’ve worked with the World Bank to develop new types of affordable loans for middle income countries, like Jordan, that have generously opened their doors to Syrian refugees. At the same time, Jordan is expanding work opportunities for refugees and for Jordanian nationals.
We hope that private investors can stand up their own initiatives, crowdfunding social entrepreneurship programs, creating micro banking solutions, or joining the first ever humanitarian impact bonds created by the Belgian Government and the International Committee of the Red Cross.
And finally, as investors, you can tip the scale for the planet. Climate change is tough to see, tough to experience on a day-to-day basis. But it’s hard to imagine the day when oceans rise above our cities, our land becomes too hot and dry to grow anything, countries go to war over dwindling resources; it’s actually hard to conceptualize that, to make it real in our minds, but it is. Unfortunately, that’s made it easy for some to put off tough choices or, worse, deny the existence of this phenomenon and that of science itself. But we see that the times are changing.
Earlier this month, the United States and China formally entered the Paris agreement. There was a time not so long ago when this would have seemed impossible, when no one believed that the two largest economies and the two largest carbon emitters would join forces after decades at logger heads. But years of painstaking and painful UN negotiations and leadership, above all by President Obama, Secretary Clinton, Secretary Kerry, helped produce an agreement among nearly 200 nations, our best shot yet at saving the planet. It was a powerful signal to the marketplace.
A clean economy is our common future. From resilient infrastructure and green buildings to climate bonds and clean energy to technology, you are helping make that day possible and doing it profitably. It’s been your leadership that proves how much more we can do. But it’s not just on you. Those of us in government have our own work to do: looking at our policies and regulations in order to foster an environment that encourages and incentivizes large-scale asset holders to join us in solving these great generational challenges.
And we need to keep learning from each other and encouraging new innovations. That’s why the Concordia Summit and the P3 Impact Awards have been so important in recognizing and sharing best practices of public-private partnership. It’s why we’ll be focusing on the Sustainable Development Goals at our Global Partnerships Week in 2017. And it’s why we’ve teamed up with the Unreasonable Group to bring together innovators from 17 ventures for a 17-day program dedicated to meeting these targets.
In an age that is more fluid and fraught with complexity than ever before, we have to think hard about how we redefine our engagement and our leadership for the times we’re living. We have to boldly defend the value of an open world, while making it real and relevant in the lives of all of our fellow citizens and responsive to their needs.
I know it can be hard looking at today’s headlines, literally today’s headlines, and see business opportunity past the chaos. But it is there and it is real. When I was in Jordan about a year ago, I met with some remarkable young Syrian refugees – 15, 16, 17 years old. And we were having a conversation about how they saw the future, and it was extraordinary to me that despite their circumstances they all had a vision for the future. One young woman wanted to be a fashion designer, another a doctor. Some of the young men wanted to be in business. They had goals. They had dreams. And they still had the confidence that somehow they could realize them.
And we got to talking about computers since that is so much the currency of this new world, and I was just curious about the extent to which they had access to computers. And interestingly enough, they did. They did at this UNICEF center that we were at; and also even in their families that had been forced out of Syria, usually there was a smartphone in each family. And as we got to talking about that, I pulled out my own smartphone and I asked them if they knew what it was. And several of them said, “Oh yeah, that’s an iPhone.” And then I asked, “Do you know who makes the iPhone?” A few of them said, “Of course. Yeah, Apple.” And then I asked, “Do you know who founded Apple?” And they thought about it, and one of them said, “Oh yeah, Steve Jobs.” And then I asked, “Do you know where Steve Jobs’ father came from?” There was silence, and then one of them said, “Syria.”
Every single person in that room, and all of these refugees, could potentially be the next Steve Jobs. Our job, our responsibility, is to give them a chance. Thank you very much. (Applause.)