Transcript: John McLaughlin speaks with Michael Morell on "Intelligence Matters"
In this episode of "Intelligence Matters," host Michael Morell speaks with former CIA Deputy Director John McLaughlin about the immediate and long-term effects the COVID-19 pandemic may have on global national security. McLaughlin and Morell focus on tensions within the U.S.-China relationship that the outbreak has exacerbated, as well as efforts by adversaries like Russia, Iran and North Korea to further destabilize the world order. McLaughlin shares views on the value of leadership to coordinate a response, and voices concerns about a potential void left by an America-First policy. "Intelligence Matters" will dedicate several forthcoming episodes to understanding the fundamentals and national security implications of COVID-19.
"Intelligence Matters" will dedicate several forthcoming episodes to understanding the fundamentals and national security implications of COVID-19.
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HIGHLIGHTS:
- Adversaries mobilizing amid the pandemic: "Iran-- I'm sure they all consider us not only distracted, but militarily less adroit right now than we normally would be because of the fact that our military has to be concerned about this virus. So we're seeing, I think, in Iraq there has been no letup in the attacks on American interests and forces by Iran's proxies, the militia and so forth. The Russians have been behaving mischievously with things like buzzing our aircraft and ships, vessels, in both the Black Sea and the Mediterranean. The Chinese have been very provocative recently in the South China Sea. And the North Koreans have been on a missile-shooting spree. So add all of that up, I think you're definitely seeing a time when these countries see an opening to do things that we would normally combat instantly, both rhetorically publicly and perhaps militarily, when we're off-balance."
- Value of global leadership: "To get to a globalized model, you need leadership. Someone has to lead it. And I don't see any country capable of leading it other than the United States… And yet, we're not, at the moment, really postured to do that. And I don't want to get overly political, but the truth of it is our current administration has pulled out of just about every multilateral institution that could be a foundation for global leadership. And has signaled, with the America First policy, that that's not what we're doing."
- Virus origins: "I've seen nothing that tells me that this was created in a lab. Perhaps it was, but I've seen nothing that affirms that confidently. Most of what I've seen indicates that it came from a bat that infected an animal that, in turn, was passed along to human beings, one way or another. We don't know yet whether that's true, and that's impeded a bit by the fact that China has started to clamp down on the publications of its research institutes on this. So it's only important because of what it tells us about the trustworthiness of what the Chinese are putting out on this."
INTELLIGENCE MATTERS - JOHN MCLAUGHLIN
CORRESPONDENT: MICHAEL MORELL
PRODUCER: OLIVIA GAZIS, JAMIE BENSON
MICHAEL MORELL:
John, welcome: Welcome to Intelligence Matters. In fact, welcome back to Intelligence Matters.
JOHN MCLAUGHLIN:
Thank you, Michael. Great to be with you.
MICHAEL MORELL:
So this is the second time that you've been on the show. The first time was May 2018. In fact, it was late May; it was around Memorial Day. And you'll remember that we talked about the organization, the C.I.A. Officers Memorial Fund that was created after 9/11 to take care of the families of C.I.A. officers who were lost in the line of duty. And I would encourage our listeners that, if you haven't listened to that episode, you should go back and do so. It's one of my favorite episodes.
I also want to let people know that we're in the midst of a series of episodes on the implications of coronavirus. So we started with Dr. David Agus, a CBS News medical contributor, to talk about the virus itself and what we know and what we don't know.
And last week we had Lisa Monaco talking about how a White House, how a government, should manage this sort of thing. And today we have you, John, to talk about the national security implications. And I mentioned to you in an email that I have a lot of questions about specific issues, ranging from strategic competition with China and potential political instability in important countries, and all sorts of things.
But I'd like to start by asking you if you have any kind of broad, cross-cutting thoughts at this point about what the kind of long-term implications of this might be for the world and international affairs, national security, et cetera?
JOHN MCLAUGHLIN:
Well, a couple things, Michael. You know, I think you have to begin with something that I would not normally begin with. And that is something that you and I will be familiar with from our time in our former profession where we always would want to know at the very beginning, "What is it we don't know?" about something.
And I think we're struggling a bit with the fact that there are more uncertainties about this situation than we typically have. You may have been through some of them with the medical expert. But obviously it bears repeating that we don't know yet whether this is a seasonal phenomenon, a year-round phenomenon, whether we'll have a second wave or a third wave.
We don't know yet when we'll get a vaccine. That's the second thing. People are saying a year to 18 months perhaps. We don't really know the origins of it: a lot of controversy about that. So you have to start by saying there are so many unknowns here that what we say about the longer-term consequences are inevitably subject to revision and speculation.
That said, some things are fairly obvious. There's a drop in output in the world to the point where I think most economists are now projecting a fairly serious plunge in growth next year. I've seen estimates as high as a 12% plunge in growth, when people were expecting really a rather smooth economy globally for the next year.
Another thing that's been going on for a long period of time, and that has been highlighted in some even intelligence publications, is a kind of global-- how to put it: a kind of global dissatisfaction with government, which we see in a lot of different arenas and countries. That's probably going to increase as a result of this because most countries are looking at their response to this, and questioning whether their systems are performing as they should be.
There's also-- another big, huge issue globally is simply demographic change. You know, the world's going to hit something like 8.3, 8.4 billion people in a couple of decades. Urbanization is increasing: 65% is what most people are expecting in a couple of decades, 65% of people living in cities.
So it's already a very urban globe: 55% or so of the population of the world in cities. That means that it's another way in which this is going to be hard to combat. Because social distancing is pretty easy where I'm living right now in Virginia. But it's awfully hard in a place like Karachi or Cairo. So there's that.
Global order: How do we think about global order? Well, global order essentially boils down to rules, institutions, borders, things like that. This thing presents a challenge to global order in ways that we hadn't really considered previously on just multiple levels.
If you look just at-- let's just take something like maritime roles and challenges. Everyone knows about China's challenge in the South China Sea and the East China Sea, and so forth. But it's kind of striking that, at this point in the Pacific, I think we have really no carriers operating. One is the Roosevelt, which is out of commission because of the outbreak there. Another one is in maintenance, and another one is on quarantine. And so, at this point, China has the only aircraft carrier operating in that region.
MICHAEL MORELL:
Isn't that something?
JOHN MCLAUGHLIN:
That, in itself, is kind of emblematic of how it has affected the U.S. ability to project power. And I know our defense department will say that they're up to any mission, and so forth. And that's kind of what we expect of them and what they typically say. But, in truth, I think our ability to project power is somewhat limited.
And then on this whole issue of global order, obviously China and Russia see opportunities here to increase their influence around the world, even as they struggle with the consequences of this virus for them. So one could go on about the broader strategic challenges and the global challenges.
Or just the supply network that's interrupted in multiple ways: just medical supplies. I mean, as an economist, you know better than anyone that the economy globally works well when things are unimpeded and moving freely. But the virus has kind of acted maybe like a circuit-breaker in terms of breaking the flow of goods in an environment where almost everything is a product of multinational contribution, from the iPhone to automobiles to the medicines that we take. One of the struggles right now being, of course, that many of the components for what we need to do testing happen to come from China.
MICHAEL MORELL:
Right.
JOHN MCLAUGHLIN:
You know? Eight to ninety percent of our antibiotics come from China. Most generic drugs, 60% to 70%, are made in India, but they get many of their components from China. And because everyone needs these things, and because other things are impeding the flow of goods, that's also off balance at this point. I should stop there because the global implications are almost beyond imagining.
MICHAEL MORELL:
John, let me pick up on a couple of things that you said. And the first is the "growing dissatisfaction" that you mentioned with regard to how populations might be seeing their governments in terms of how they're dealing with the outbreak itself, or how they're dealing with the economic consequences. And so I'm wondering, sort of after the fact, as people are allowed to, or as they feel comfortable going back out onto the streets, if we're going to see calls for political change in a number of countries, calls for political change that could even become violent. How do you react to that?
JOHN MCLAUGHLIN:
You know, I'm not thinking so much of violence. I'm thinking more a matter of diminished trust in government. If you look at China, for example, and it's always hard for us to imagine any really consequential discontinuity in China. People tend to think China will just be China, and they'll continue being the way they are.
Well, it's now pretty obvious that China waited six, seven days, a week or so, before they informed the population that they had a serious problem. That's come out in some leaked documents that have appeared in the media. It's also obvious, and been reported, that China is restricting publication of research that has been done in China on the origins and the development and spread of the virus.
So given that China already has a problem with Hong Kong feeling oppressed and speaking out about it; and given that Taiwan handled this a lot more skillfully than mainland China did, you can imagine in the aftermath of this that there will be some strong discontent in China about how the government handled all of this. You know, in our own country, surveys by the Pew organization, a reliable public opinion surveyor: If you went back to 1964, 75%, 76% of Americans said they trusted the American Government to do the right thing. That's now down to 17%.
MICHAEL MORELL:
Wow.
JOHN MCLAUGHLIN:
That's before coronavirus, before coronavirus. So you start off with, in the United States, a kind of diminished trust in government that has built over a long period of time. And you just have to watch the news every day to realize that we're at a moment here where I think the average citizen is not quite sure what to believe about everything from masks to the availability of testing.
Look at Russia: It's clear Putin is trying to stay out of the public sight and delegating most of the public decisions on this to his advisors and his spokespeople and the Mayor of Moscow, and so forth. This is nothing he wants to be particularly associated with as the responsible authority.
So I'm not thinking of violence so much. But here's another one, and I'll stop at this point. If you look at the developing world, where we don't have a real-- at least I have not been able to find a real empirical sense of what's going on there with the spread of the virus. Largely because in some cases it's authoritarian governments, as in Iran, who aren't publicly acknowledging the depth of their problem.
And in other places it's just inefficiency, or so forth. So I mentioned demographics a few minutes ago: With the burgeoning population in the world, only two to three percent of that population increase is going to occur in the developed world. This is going on every year.
So in the less-developed world, you have burgeoning populations, governments that already have trouble providing services, and now you've got the coronavirus on top of it. I don't think we have the slightest idea what's happening in countries that have no ability to do social distancing and the potential, because of many of them being in the Southern Hemisphere, for all of that to coalesce into a second wave that comes north again.
We've got to think about that. But in those societies themselves, you can see, because the stresses are already there, ethnic turmoil, migration, all of that. That's probably all going to be increased by this virus because it's a problem that they're not prepared to handle.
MICHAEL MORELL:
So, John, do you have a sense of how this will impact the already-existing trend away from democracy and toward authoritarianism in the world?
JOHN MCLAUGHLIN:
Well, I gather it's already started in places like Hungary where Orban has taken a lot of power unto himself, to the point where the European Union has scolded him for exceeding the rules of the European Union when it comes to democracy. You have a sense that certainly it's not going to enhance democracy in places like China or Russia or Egypt, for example, or Iran. So, yes, I think the net result is probably going to be strengthening of authoritarian societies, if they can survive it, going back to the uncertainties I mentioned at the very beginning.
MICHAEL MORELL:
Yeah, you get the sense that publics are willing to give up some of their rights in these kinds of situations, and are willing to give more power to the executive in order to protect them. And executives like Orban, and it's also happened in some other places now, look to take advantage of those situations and grab power. And probably don't plan on giving it back after their crisis subsides. So I worry about that.
JOHN MCLAUGHLIN:
Well, it's a war. It's a war, and in wartime you typically find that in societies, even in democratic societies.
MICHAEL MORELL:
Yeah. So I want to come back to the point you made about the origins of the virus. You mentioned it a couple of times, and there's the whole issue of man-made versus naturally occurring. I'm not really interested in that debate, but the issue of, "Was this a virus that was being researched at the Wuhan Institute? And did it leak out accidentally?"
The Secretary of State, Mike Pompeo, has been pretty strong about his views on that with regard to the possibilities. And I wonder to what extent that might be overstating the evidence that we have? Just wondering what your thoughts are about the origin question and then why it's an important question.
JOHN MCLAUGHLIN:
I think that's overstating the knowledge on this. Again, you know, I'm not reading classified material here. But you and I can both usually read between the lines of press stories that talk about intelligence. And the ones I've read, and this is obviously the result of someone in the policy community, I guess, talking about what they've seen in the intelligence, the intelligence community at this point seems undecided about it. Or at the point of saying they cannot yet get to the bottom of it.
And so I'd go, for now, with the idea that this is not certain enough to be confident. And that seems to be what people other than Secretary Pompeo think. Certainly, the defense secretary, Esper, has come down on the side of, "We're just not sure yet. We're looking into it."
Why is it important? I think it's important on two levels: First, I've seen nothing that tells me that this was created in a lab. Perhaps it was, but I've seen nothing that affirms that confidently. Most of what I've seen indicates that it came from a bat that infected an animal that, in turn, was passed along to human beings, one way or another.
We don't know yet whether that's true, and that's impeded a bit by the fact that China has started to clamp down on the publications of its research institutes on this. So it's only important because of what it tells us about the trustworthiness of what the Chinese are putting out on this.
And the importance of that is that we can't get through this, in my personal opinion, without a fairly transparent and cooperative relationship with China. I mean, the distinguishing feature of this virus is that it requires a global response because it doesn't know any boundaries. And unless we work together on this, we are not going to be able to beat it in an efficient manner. So it matters, as a matter of confidence in dealing with China, that we understand its origins. And the sooner we get to the bottom of that, and they help us get to the bottom of that, the better.
MICHAEL MORELL:
So I couldn't agree more with your characterization that we need a global response. But it sure looks like every nation has turned inward and is worried about itself inside of its borders, with not a lot of folks being interested in coordinating some sort of global response.
JOHN MCLAUGHLIN:
Yeah, well, we have to think about this. Look at the way the world reacted to the Spanish Flu in 1918-19: Again, nationalism triumphed after that. And within 20 years we were back at war in the Second World War. So the question here is, "Do we deal with this in the way the world dealt with it after World War I?"
"Or do we deal with it in the way that the United States dealt with turmoil and trouble after World War II, when we created, largely with U.S. leadership, all of the institutions, multinational: ranging from the U.N. to NATO to the Bretton Woods Agreement, and so forth and so on, the IMF, creating, essentially, the foundation of what became a globalized economy and a globalized network?"
Which of those models prevails here? And to get to a globalized model, you need leadership. Someone has to lead it. And I don't see any country capable of leading it other than the United States, for a couple of reasons. First, everyone looks to us, even when they criticize us. One thing I learned in my career was people want U.S. leadership, even when they don't want it.
And yet, we're not, at the moment, really postured to do that. And I don't want to get overly political, but the truth of it is our current administration has pulled out of just about every multilateral institution that could be a foundation for global leadership. And has signaled, with the America First policy, that that's not what we're doing.
I know they will say that we are leading. And I've heard them speak publicly, at the Munich Security Conference and elsewhere, about how, "The United States is leading." But if you're in the audience and listening to people, no one thinks we're leading. So you have that problem.
And then if we're not going to lead, who does? I don't think the Chinese can lead. They do not have our soft power, meaning the universal identification with culture and values that people have when they look to the United States. I mean, 70% of the box office receipts for American movies are overseas, mostly in Russia and China.
And no other country has that, that soft power. So while people may want medical supplies from China, and they are presently the world's largest manufacturer and supplier of ventilators and masks, and while they're also shipping out medical equipment to dozens of countries in Europe, Africa, Asia, and the United States, I think people will gladly take their help, but not translate that into a desire for Chinese leadership on international affairs, global order, national security.
And so I fear that we're in that World War I posture where no one is picking up the leadership mantle in a real sense. It's hard work. It's really hard work. And nations are going their own way. And on top of that-- I mean, I've always been kind of an embarrassingly enthusiastic fan of the European Union, largely because I was a student in Europe in the early days of that. And I became infected with the idea that this was kind of a solution to Europe's problems. Which I think, for the most part, it has been.
But even in the European Union, you have disunity. Germany has done well, better than most of the countries there. But none of the countries are helping each other, and they're competing for all of the things you need to get through this. And the Chinese have shown up, again, with help that's accepted in places like Italy. Russia has shown up in Serbia, which is not a NATO member but is a partner nation of NATO. Russia has shown up to great effect with their Slavic allies in Serbia. So what you see is a situation, so far, that is more comparable to the post-World War I situation than the post-World War II situation.
MICHAEL MORELL:
Okay, John, let's maybe dig into some specific issues. And maybe the most important is what you think, what your sense is-- I know it's awfully early, but what your sense is of how this will affect the U.S.-China strategic rivalry.
JOHN MCLAUGHLIN:
Well, this is a difficult time for U.S.-China relations for a bunch of reasons. First you have the trade war, which has eased a bit with the Phase I Agreement. But the Phase I Agreement didn't cover the toughest issues, really. It didn't cover agreements on manufacturing, for example, which is the thing I think Trump really wanted out of it.
So you have, still, the trade tensions. I mean, let's break it down. You've got that. You've got the military competition, which centers on the South China Sea, China Sea and Taiwan, potentially. And in the background of all of that, you have the approaching presidential election.
Now, I've been around long enough to have listened to the China debate in every presidential election. And in every presidential election, China's one of the bad boys. So we're about to experience a lot of rhetoric, perhaps not from the Democratic side. In fact, I don't anticipate it from the Democratic side, even though it has been, often in the past, on the Democratic side. But I have a sense it may not be this year because of these unique circumstances.
But the potential for a breakthrough in China-U.S. relations is not great at the moment. That's probably an understatement. Add to that the fact that Washington's debated this for years, and the way I see the foreign policy elite in Washington, whatever that means: to some it's "The Swamp," to others it's "The Elite," I guess. But really smart people, thinkers, people who work on foreign policy, both in the government and outside: The mood on China has really soured in the last couple of years, a sense that we have tried all of the things that we can try to encourage a better relationship with China, and nothing has quite worked.
And so that's left, I think, more people than in the past thinking of China as much less than a partner, when in fact for years, the debate was, "Will China be an enemy, an adversary, a competitor, potentially a partner?" Right now, I think the "partner" vote is pretty small.
MICHAEL MORELL:
Uh-huh (AFFIRM).
JOHN MCLAUGHLIN:
Now, what do I think? I think-- I get to say what I think, right? I think we ought to be trying to figure out how to get closer to competitor / partner here. Because given the fact that these are the two most important, largest economies in the world, we're not just doing this for ourselves. It's going to affect everyone in the world, what happens in the China-U.S. relationship.
So we actually are carrying a responsibility for a good part of the world when we deal with China. And I think a trade war is a bad idea, even though I think Trump is correct to have spotted abuses in their trade program. That's fair enough. But to make it a war is a bad thing.
To have pulled out of the Trans-Pacific Partnership gave up leverage that we would have had in Asia to deal with China on a more effective foundation. Because with the, I guess, total of 11 other countries from Pacific to Asia, we would have had a foundation of accord on broad trade issues with which to face China. Versus the situation we have now where we're facing them bilaterally and the remaining members of the Trans-Pacific Partnership have coalesced and gone their own way in an agreement that leaves us out.
So what you've got to do, then, to get a better strategic relationship is get back into that kind of club where you're dealing with all of these people together. It would have the advantage of traditional alliances, like NATO, the European Union relationship, the former partners in the Trans-Pacific Partnership. If we were all knitted up with them, then we would be able to represent those interests combined in our dealing with China, rather than where we are now.
So I don't want to leave the sense that this is all hopeless. This is all fixable, repairable. But it's hard work, and those things, I think, have to be done with no illusions. Because China is certainly not going to be an easy counterpart for us to deal with. They are a rising power. They are looking to the future. They think their day has come. And yet they have their own internal problems. And I'll stop there because that's the other side of this coin: They're having their own internal problems.
MICHAEL MORELL:
Yeah. It really seems to me, and I don't know if I'm overstating this, but it seems to me that they sense that this is an opportunity for them to garner some significant influence around the world, right? With us focused internally, and with their ability to share medical supplies and medical personnel, that they see this as a soft-power opportunity. And I'm wondering how you think about that?
JOHN MCLAUGHLIN:
It certainly is an opportunity. It is an opportunity to gain soft power, or to present a different face that leaves that residue of soft power with other countries. I am skeptical that they can bring it off, in part because I just don't have a sense that people identify with everything from their human rights practices to their governmental structure. They'd like to present what they are doing governmentally as an alternative model. Call it "Market Leninism," whatever you want to call it: basically a fairly open economy and a very restricted, tight-political-control regime. I don't think anyone really wants that.
But I could be wrong. I mean, we may be at one of those-- that's how I would bet. I would bet that people will have a transactional relationship with China, be very happy about that. But the only reason they would lean toward China and allow China to exploit this for soft power advantage and leadership advantage-- the only reason, in my judgment, is because we are creating a vacuum. In other words, we are creating a void there that they can move into. We are part of the opportunity. And I think--
MICHAEL MORELL:
Yeah, one of the--
JOHN MCLAUGHLIN:
--we --
MICHAEL MORELL:
--one of the th--
JOHN MCLAUGHLIN:
--the old, people would run to us. Everyone that I talk to in Asia, and I'll bet you've had this experience, too: They want us in the game in Asia. They're in China's orbit economically, but they don't want to be in it politically. That's where I see it.
MICHAEL MORELL:
John, the other primary adversaries of the U.S.-- Russia, Iran, North Korea: One of the questions that I get and I'd love to pose it to you is, "Do you have any concerns about any of them trying to take advantage of the current situation?"
JOHN MCLAUGHLIN:
Yes. Yes. Iran-- I'm sure they all consider us not only distracted, but militarily less adroit right now than we normally would be because of the fact that our military has to be concerned about this virus. So we're seeing, I think, in Iraq there has been no letup in the attacks on American interests and forces by Iran's proxies, the militia and so forth.
The Russians have been behaving mischievously with things like buzzing our aircraft and ships, vessels, in both the Black Sea and the Mediterranean. The Chinese have been very provocative recently in the South China Sea. And the North Koreans have been on a missile-shooting spree.
So add all of that up, I think you're definitely seeing a time when these countries see an opening to do things that we would normally combat instantly, both rhetorically publicly and perhaps militarily, when we're off-balance. We're not being able to do much of that.
MICHAEL MORELL:
Yeah. The one I worry the most about, John, is Iran because they both need an external enemy, an external focus, to get their public's mind off of their public's dissatisfaction with them, and I think they sense that maybe this is an opportunity for us to look at Iraq and say, "It's just not worth it, it's just not worth fighting for." So I do really worry about Iran picking up the tempo even more in Iraq, with the hope that we just say, "We're going to go home; it's not worth it."
JOHN MCLAUGHLIN:
I think that's a valid fear. I agree with you. We haven't mentioned Syria, either, where, in this current circumstance, we were already at the point of saying, "It's not worth it to us." But it's hard for me to imagine us remaining very committed there in these circumstances. And also places like this, it ripples into other things.
For example, the great controversy now over the World Health Organization: You could do a whole podcast on that itself. But what they're facing reminds me of the kind of situations that you and I often dealt with in our former jobs. Where you look at something and you realize, "The alternatives facing us: None of them are good. Which one is least bad?"
I think the World Health Organization is not without its faults and flaws. But when you look at a situation like Syria, for example, they're kind of stuck. If they don't intervene in parts of the world where we can't really be present, whether it's Syria or sub-Saharan Africa, those countries are not going to get much help as this virus takes hold. And yet they end up having to deal with nasty characters, dictators, and open themselves up to criticism for doing that. So which do we want? Do we want them not to do that? Do we want them to do that? Those are unpalatable alternatives. But this virus is confronting people with those kinds of choices.
MICHAEL MORELL:
So another question I wanted to ask you is about international terrorists. You know, we both know that Al Qaeda, prior to 9/11, was researching chemical and biological weapons, anthrax on the biological weapons side. We know that ISIS was interested in both chemical and biological weapons, and actually used chemical weapons on the battlefield in Iraq and Syria, chemical weapons they had produced in university labs where those universities were inside the caliphate. So I'm just wondering about [whether] this might rekindle an interest of terrorists in biological weapons. What's your sense?
JOHN MCLAUGHLIN:
You know, that's a really tough one, Michael. The surprising thing to me all along with terrorism is why we haven't seen them use biological weapons more than they have. Because we've known for years that they're not that hard to make, leave aside coronavirus. It's been demonstrated that you can make pretty sophisticated chemical and biological tools with household chemicals and fairly easily available strains, cultures.
So I'm puzzled as to why they haven't done it before. I could see-- I almost hate to say it because sometimes you think up an idea, and you think it's so horrible you don't want to suggest it. But I could see the extreme elements of the organizations seeing merit in getting someone infected and circulating him in society somehow as a kind of living weapon that can't be detected very easily.
But on the other hand, it's also occurred to me-- this is why this question's so hard: If you're in ISIS right now, you're probably on the run, hiding out in remote parts of Iraq and Syria. You're probably getting this virus, or you're susceptible to it. And it could just as easily destroy their fighting population as it destroys everything else. And hard to believe that they have much in the way of medical equipment, testing, medicines, and so forth. So I think that's a really hard one. I can't really offer any great wisdom on that one.
MICHAEL MORELL:
Let me just come to the last question, John, come back to this issue of China's pursuit of influence. One of my concerns is the financial stability of emerging markets. They are heavily leveraged. They have a lot of dollar-denominated debt. They're not going to be, from a public health perspective, able to deal with the outbreak. They're not going to have the fiscal and monetary policy tools to make a difference on the economic side.
So I wouldn't be surprised if a number of them start lining up outside the IMF and the World Bank asking for help. And my fear is that there are going to be so many of them that they're not going to be able to get what they need from those institutions.
And there's only one place in the world who has that kind of money. And so I'm concerned that China kind of swoops in to save the day here for many of these emerging markets. And the potential impact of that on Chinese influence may be much, much more significant than it is on the public health side.
JOHN MCLAUGHLIN:
I think that's exactly what going to happen. The projections I've seen for emerging markets have their growth rates plummeting by at least five percent just this year. And Lord knows what happens after that. So they're--
MICHAEL MORELL:
And we knew how difficult it was to deal with one country in financial crisis, or two or three in financial crisis, let alone ten or 15.
JOHN MCLAUGHLIN:
Right. And a number of these countries-- yes, so, yes, they're ripe for the picking, and China will show up, I'm sure. Again, the only way I think China begins to translate this into real influence is if they stop being so transactional in the way they provide assistance.
Usually, what they're doing is providing assistance with all kinds of qualifiers. Not moral and human rights qualifiers, but qualifiers that give them territorial rights, commercial rights, and so forth. And so there's a kind of exploitative quality to their assistance. That doesn't mean people wouldn't take it. But it does, again, in my mind, limit how much love they buy for it.
MICHAEL MORELL:
Yeah.
JOHN MCLAUGHLIN:
Maybe it's not so much about love, though, in the end. And then at the end, you've also got to look at how-- one thing we haven't talked about, and very quickly I would just observe, the other part of the economy that's really in a tailspin as a result of this little, tiny, microscopic virus is the oil market.
MICHAEL MORELL:
Right.
JOHN MCLAUGHLIN:
Because everyone's production is down, demand is down. Russia and China had a brief battle over reducing oil output. Russia won. The projections I've seen have oil prices plummeting in April and May below where they are now. Which is around, what, $40-some a barrel. And so that is going to hit some of these emerging markets: Nigeria, Angola. It's going to hit Russia itself.
MICHAEL MORELL:
Right.
JOHN MCLAUGHLIN:
And that's another almost-incalculable factor in all of this. But, again, if China's recovering, they'll be one of the few people buying oil. And so that's another bit of leverage they have perhaps.
MICHAEL MORELL:
John, thank you--
JOHN MCLAUGHLIN:
The other thing with China is we keep our eye on it. I've said where I stand, but I'm also quite prepared to say I could be wrong because we're going to see some discontinuity out of this that none of us are predicting.
MICHAEL MORELL:
Right. John, thank you so much for taking the time to be with us today. Thank you.
JOHN MCLAUGHLIN:
It's always a pleasure, Michael, thank you.
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