Thursday, July 19, 2018

The Tory vision for a post-Brexit economy is a dead-end – but there is an alternative - Independent

The Tory vision for a post-Brexit economy is a dead-end – but there is an alternative
Effective industrial strategy requires a clear understanding of Britain’s place in the world economy now, and a clear set of goals for where we want it to be in the future

Chi Onwurah

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Last week’s resignations of Brexit big beasts David Davis and Boris Johnson demonstrates once again that the customs union is the beating heart of the Tory Brexit breach. The nature of our future trading relationship with the European Union straddles so many Tory totems from the role of business to the European Court of Justice to the border with Ireland. As a consequence an internal party “deal” that took two years to put together fell apart within two days and now we are once more the laughing stock of Europe with only a matter of months before we leave.

Reforging 40 years of economic, political and societal links in a constructive, inclusive and forward-looking way would be a challenge for any government but is clearly far beyond the capacity of this one. As a government in waiting, it is Labour’s job not only to hold the government to account but to set out what our approach would be. This is the work that Keir Starmer and Labour’s Brexit team has undertaken, exemplified by the amendments our party tabled to the Great Repeal Bill. But it is also my job as shadow minister for industrial strategy to consider what Brexit means for our economic future and to place decisions in that context. And that has to mean an economic future that includes everyone, and does not merely carry over the regional and social divides that helped deliver the referendum result in the first place.

To achieve this we need to look back even as we look forward. And to look outwards to the world even as we consider how best to maintain a close relationship with the European Union.

Ex-minister becomes first senior Tory to call for second Brexit vote
The industrial landscape of Britain today is the product of a succession of industrial strategies or non-strategies, each of which was ultimately unable to deal with the reality of the larger world economy. Britain entered the 20th century hoping to maintain its position as the supplier of manufactured goods to the largest empire the world had ever known, a strategy that could not be sustained given the scale of US industry and the understandable desire of the rest of the Empire to build its own industrial base. By the 1960s, British industry was increasingly focused on our domestic market, but even that more limited “strategy” proved untenable in the face of more efficient and larger scale foreign competition from the United States, Japan, Germany, Korea and ultimately China.

In response, the Tories under Margaret Thatcher and her successors, and to a lesser extent the 1997 Labour government, pursued a kind of “anti-industrial strategy”. This substituted first North Sea oil and then City of London financial services for industrial competitiveness. North Sea oil was a finite national asset that delivered the expected temporary economic boost. The impact of our burgeoning financial sector was more complex. It brought substantial benefits in jobs, revenues and social capital, particularly to London. It also drove the “financialisation” of our economy.

Financialisation – the anti-industrial strategy

The way in which financialisation proved to be an anti-industrial strategy is admirably set out in leading economist Mariana Mazzucato’s new book The Value of Everything. In it she describes the “two faces of financialisation”.

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The first of these is the way in which the financial sector has stopped resourcing the real economy – instead of investing in companies that produce “stuff”, finance is financing finance. Why lend money to a manufacturer that may fail when you can make a bet on some options hedged with other options that virtually guarantee a return in a few weeks? The owner of a medium-sized manufacturing business gave me a striking example of this recently. His high-street bank was initially supportive when he requested a loan for new manufacturing equipment, which would significantly boost productivity. Once the bank realised that the equipment would not be something they could sell on should he go bankrupt, their interest drained away entirely. It was willing to lend based on liquidation value, but was not willing to take a risk on a living business. In a financialised economy, capital tends to flow towards standardised securities rather than actual operating businesses that present bespoke risks.

But it is not only financial capital that is diverted from the real economy. Human capital is sucked in too. When I graduated from Imperial College in 1987, I would estimate that only about 10 per cent of my electrical engineering cohort went into industry. The majority went into management consultancy and finance, which paid better as well as having clearer career paths. Recently the dean of an engineering department told me that was still the case and asked how I could expect engineers to go into engineering when finance paid so much better and was quite honestly the only way a graduate engineer could ever hope to buy a home in London.

I responded that they should come to Newcastle where not only could they buy a lovely home on an engineer’s salary, but also be within a few minutes of some of the most beautiful countryside in the world and at the heart of a concentration of culture that rivals far bigger cities. I recognise the dean’s point – with so much financial engineering demanding money and people, real engineering doesn’t stand a chance. But it is real engineering that drives industrial productivity.

Financialisation is not just a problem because it drains resources away from industry. In a financialised economy, investors with short-term horizons tend to have more control over firms. This results in less reinvestment of profits and rising burdens of debt that, in a vicious cycle, makes industry even more driven by short-term considerations. In effect, this kind of finance is not neutral but changes the nature of what it finances.

This was seen just recently with the GKN takeover by “turnaround company” Melrose. An estimated 20 to 25 per cent of the shares in GKN were in the hands of hedge funds, many of which were expected to back the takeover – with the firm Elliott Advisors, owning 3.8 per cent of the company, explicitly doing so. The bid was won by 52 per cent to 48 per cent. And Melrose itself is not run in any long-term interest other than maximising shareholder value: it has a long history of operating as a “turnaround firm” and almost a third of its own shares are held by hedge funds. The vote was essentially a referendum about the time horizons of British industry, and Britain lost.

So when bankers and chancellors talk of having learned the lessons of the financial crisis they are wrong both at the macro and micro level. With UK national debt twice what it was in 2007 and household debt to disposable income at a record high, 10 years after the crash of the global economy, finance is once again at the heart of an existential threat to our way of life.

Financialisation and inequality

Even before the crash, this “anti-industrial strategy” drove social and geographic inequalities. Levels of income inequality as measured by the Gini coefficient reached a pre-crash peak of 0.35 in the 1990s and, while improving slightly, remained high in comparison to the Sixties throughout the 2000s. Regional inequality was also a significant feature of the pre-crash economy, with data from the National Institute of Economic and Social Research showing a gradual rise throughout the 2000s in the difference in gross household income between regions. In 2005, average household income in the North East was 14 per cent below the UK average, while in London it was 20 per cent higher.

The Tories were either indifferent to these inequalities or at best felt they were an acceptable price to pay. Labour, under previous leaderships, believed that redistributive policies could make it all come out right in the end, and flagship programmes such as Sure Start and working tax credits certainly helped. But both approaches were fundamentally mistaken. Financialisation turned out to be a house built on sand – unable to generate enough wealth to compensate for the abandonment of the rest of the economy, and vulnerable to boom and bust cycles. Ultimately, the financial crisis of 2008 and the global economic crisis it spawned showed that the ideology of finance – that financial markets and institutions, left to themselves and the profit motive, would efficiently allocate capital – was a pernicious fantasy.

British industry—creating real value in the real economy

But that was not the whole story. While metropolitan London came to comprise 40 per cent of the British economy – and a 40 per cent heavily dependent on finance and professional services – something else was happening in the rest of the country. Britain’s entry into the European Union, and the survival in parts of Britain of a culture favourable to engineering and manufacturing, fostered the growth of certain sectors of British industry as part of a larger integrated European industrial base. The supply chains of large European firms such as Airbus, Boeing and BMW are substantially British. Nissan’s Sunderland plant is the final destination for parts manufactured across Europe and produces more cars per worker than any other factory in the European Union. And GKN, itself one of the world’s oldest engineering firms, is a key supplier to international aerospace and automotive firms – including European giant Airbus, which warned against the Melrose takeover. Factories engaged in producing components and sub-assemblies and assembling components from elsewhere in Europe are now critical to the prosperity of much of Britain. Figure 1 shows just one of BMW’s many supply chains.

BMW supply chain starts in France, where the cast of the raw crankshaft is made. From there, it is shipped to BMW’s Hams Hall plant in Warwickshire, where it is drilled and milled into shape, then sent to Munich to be inserted into the engine. The engine is then ’married’ with the car at the Mini plant in Oxford
Such integration requires frictionless borders but also agreed standards to define everything from the acceptable frequency of electromagnetic radiation to the atomic composition of a given chemical. Leaving the European Union will not mean less regulation simply more duplication. As they scramble to recreate existing EU agencies and regulations, businesses and government departments are realising that far from Brussels bureaucracy being imposed upon Britain, the European Union was effectively based on the “shared back office services” model that Whitehall now champions for local government.

In many ways, British agriculture has followed a similar trajectory to British car manufacturing, where British farmers have been able to successfully compete on both quality and price in markets defined by EU food safety rules. For example, British farmers export far more wheat flour to the EU – approximately 250,000 tonnes last year – than they do to non-EU countries – approximately 6,000 tonnes. The same goes for other agricultural products such as barley (one million tonnes versus 50,000 tonnes) and oats (16,000 tonnes versus 4,000 tonnes).

The EU is the largest importer and exporter of food in the world. As an EU member state, our farmers have benefited from preferential access to this market through exemptions from the tariffs and quotas imposed on non-member countries. And with 85 per cent of seasonal agricultural workers in the UK coming from Bulgaria and Romania, agriculture is one of the UK sectors most heavily dependent on freedom of movement.

Food and drink is Britain’s largest manufacturing sector and Europe’s complex rules of origin guidelines could lead to a “hidden hard Brexit” requiring the restructuring of food manufacturing supply chains even if we secure preferential access. Agriculture and manufacturing are both more important outside of London and particularly around the very market towns that have been most “left behind” by the new economy.

As Britain contemplates how to engage with the world before, during and after Brexit, we need to understand the trade policy choices we make will drive the shape of our economy and are therefore also industrial policy choices, choices that will shape the very nature of what work we do, the health of our communities and the way we live for decades to come.  

The benefits of a customs union

The Labour Party is united in supporting a customs union with Europe. We believe it will bolster our current industrial strengths and offer the possibility of continued industrial revival in certain sectors. We should not be complacent about this approach. Our place in the larger European manufacturing economy will still depend on our ability to innovate and to invest, so that British firms successfully manage and not just participate in supply chains. And this will depend on our learning the lessons of the financial crisis so that our financial markets and institutions actually invest in productive sectors.

Unfortunately, the government continues to act as if the only issues in financial regulation are safety, soundness and fraud. While these are obviously important issues, they completely miss the question of whether our financial system is effectively channelling capital to productive and innovative investment. And this is the whole point of a financial system. A financial system that simply parks money in risk-free assets or honestly gambles on sporting events, would meet the characteristics the Tories have established but would still be a total failure. As Mazzucato argues, the traditional policies we have seen create a “healthy financial sector (bailed out, ring-fenced, and restructured) in a deeply sick economy”.

Implications for industrial strategy of the alternatives

Last week’s visit by President Trump to Britain revealed that he thinks the UK-US relationship is “the highest level of special”. Arch Brexiteers argue that he offers an alternative to a customs union with Europe: a free trade agreement with the United States, which, as a consequence of Nafta would really be a free trade agreement with all of North America. But while the US economy is of comparable size to the EU in GDP terms, $19 trillion (£14 trillion) compared to $17 trillion, they have different sectoral compositions and regulatory standards. Going in this direction would lead to substantial changes in the structure of the British economy.

Earlier this year, trade experts at Harvard University published a report that included a candid assessment of obstacles to a US-UK free trade agreement. Its authors, including former shadow chancellor Ed Balls, reached the conclusion that it is “highly unlikely that a free trade deal between the US and the UK will be secured in the near term” and, in addition, “the likely potential benefits for British businesses are less than often suggested”.

The report focused on likely US demands for access to British food markets and likely British demands for access for British firms to US financial and professional services markets. These demands map the likely direction a US-UK free trade agreement would take both countries. Britain is attractive to the US as a market for agricultural products and for goods manufactured through US-controlled supply chains. Britain is also seen by some as a source of relatively low cost financial and professional services. Without an EU customs union, American business does not see Britain as a manufacturing platform – British wages are too high given the distance to the North American market. Labour costs per hour in manufacturing are on average £27 in the US and £23 in the UK – a £4 difference that does not compensate for transport costs.

In a UK detached from the European market, the role of British industry in European supply chains will therefore not be replaced by similar roles in US-based supply chains. This is the critical point for UK manufacturing – we cannot replace European supply chain integration with North American supply chain integration.

In addition, if British food safety rules are relaxed as part of a trade deal with the US, it is likely that cheap American agricultural products will significantly displace British agriculture. So we will eat chlorinated chicken from Arkansas, bake with GM flour from Dakota and barbecue antibiotic drenched beef from Illinois. US farming is largely in the hands of mega industrial organisations. Agriculture is a much greater proportion of US GDP than it is of UK GDP. There are farms in Texas that are bigger than major UK counties – 500 square miles, for example. We cannot compete with agriculture on that scale without harming our landscape and biodiversity, especially given that we already use substantially more of our land in percentage terms on agriculture than does the US. If our markets are opened up to US agricultural products, UK farming will either adapt to US food safety practices and scale or our agriculture will diminish greatly. If we were to follow the bidding of the arch-Brexiteers and take the US as our model partner it would be the end of our landscape and biodiversity as we currently know it.

In the place of agriculture and industry, there will be a US market for British financial services and other professional services such as law, accountancy and management consulting. However, just as we have seen the integration of British manufacturing into European firms, we will likely see a wave of mergers and acquisitions in services as British firms are acquired by US firms seeking to serve the US market with British professionals. As a consequence, while manufacturing and agriculture would suffer, services and finance might not remain in British hands, especially given the current takeover regime that substantially limits the scope for government protection of UK businesses.

A Britain without a customs union with the EU and with a free trade agreement with the US would have less industry, less agriculture, but more finance and more service sector jobs. It would likely be a Britain of growing regional and social disparities, and a Britain more vulnerable to financial instability. After all, it was the high concentration of financial services in the UK economy that meant we were hit particularly hard by the last financial crisis. If the UK economy consolidates further around finance, then we will become even more vulnerable.

The Commonwealth

Turning from North America some look to the Commonwealth as an alternative future that harks to our past. We have strong ties to English-speaking Commonwealth countries around the world – economic ties as well as ties of language, immigration and history. In a digital world, we have the possibility of building networks of innovation that could contribute both to our own industrial competitiveness as well as the competitiveness of our partners.

Countries as diverse as Nigeria, Australia and India are all racing to be centres of technological innovation and to solve pressing problems in areas such as energy and education. In a sense, if we are open to our former colonies as partners, and generous with access to our own centres of innovation, we could perhaps create alternative pathways to competitiveness for our industry.

But those same countries have requested access to the UK through preferential visa arrangements as part of any free trade agreement. India has requested an increase in the number of visas issued to skilled Indian workers and allow students to stay for longer after graduating, but so far government has refused calls to relax visa rules even within the current framework. Australia and other Commonwealth countries want their citizens to be granted the same rights as Europeans: to live and work in the UK after Brexit.

Building a competitive commonwealth innovation network effectively requires the opposite of our current attitudes towards the Global South. Commonwealth leaders have criticised the government’s – reported – characterisation of post-Brexit trade as ‘Empire 2.0’. This was reflected in our treatment of the Windrush generation, which, in a sense, like our approach to Brexit, threatens to close critical doors to a better future for British industry and for Britain as a whole.

Whether we look to North America or the Commonwealth, into our past or forward to the type of economy we want to become, the arguments bring us back to a customs union with the EU and an industrial strategy that will help rebalance the economy and provide the directed investment to get it growing again. The billions poured by the Bank of England into quantitative easing have signally failed to do this.

A Labour government would invest £250bn over 10 years through our National Transformation Fund, and set up a National Investment Bank, as well as a network of regional development banks to channel investment into productive enterprises across the country, unlocking productivity and creating growth.

We need to understand as we approach critical decision points around our trade policy and our financial regulatory policy that these are choices that will shape not just our relations with the outside world but Britain itself – that choices labelled trade policy or immigration policy or financial regulatory policy are in fact industrial policy, agricultural policy and economic policy.

The Tory party ideologues are in no state to set out a vision for our future economy, far less to rationally assess the policies needed to make it a reality. Financialisation has proven to be an economic dead-end, creating wealth for the few at the expense of social equality, regional balance and long-term productivity growth.

To build a more competitive and equal Britain post-Brexit we need a deal that strengthens our productive sectors such as manufacturing rather than one that deepens financialisation and risks our long-term prosperity. We also need a real industrial strategy based on our regional strengths that enables investment in the productive economy, delivering jobs in our towns as well as our cities that creates value regionally and nationally that can be shared by all.

Warren Buffett may soon join the stock buyback party - CNN Money

Warren Buffett may soon join the stock buyback party
by Paul R. La Monica   @lamonicabuzz
July 18, 2018: 4:50 PM ET

Buffett not worried about a trade war
Big US companies have been binging on their own stock. But Warren Buffett's Berkshire Hathaway hasn't been taking part in the bonanza. That soon may change.
Berkshire Hathaway (BRKB) announced late Tuesday that the company loosened an old company rule and can now buy back stock whenever Buffett and Berkshire Vice Chairman Charlie Munger "believe that the repurchase price is below Berkshire's intrinsic value, conservatively determined."

In other words, Buffett and Munger can pretty much decide to buy stock whenever the heck they feel like it.

Berkshire Hathaway stock had its best day in almost seven years after the change was announced.

Stock buybacks have been one factor helping fuel the market run to record highs in 2018.

Companies bought back $436.6 billion of their own stock in just the second quarter -- a new record, according to data from research firm TrimTabs. Companies have now repurchased nearly $670 billion of their own shares so far this year.

Buybacks are considered a bullish sign for several reasons.

For one, a company may be signaling it thinks its stock is a bargain. Buybacks also lower a company's overall share count, which in turn boosts earnings per share.

But the last time that Berkshire -- an industrial empire that owns Geico, railroad Burlington Northern Santa Fe, Dairy Queen and numerous other businesses -- bought its own stock was in December 2012.

One reason Berkshire has stayed on the sidelines of buybacks is because of the company's old rule, which stated that Berkshire could not pay more than 20% above Berkshire's book value per share -- a key measure of a company's financial health.

As of the end of the first quarter, the book value for one class A Berkshire share (BRKA) was $211,184. But the price of one Berkshire A share currently trades for nearly $300,000. That's 40% higher than book value, which means Berkshire was prohibited from buying the stock under the old rule.

Berkshire also has more affordable B shares that trade at a price of about $200. Shares of both the A and B classes of Berkshire stock rose more than 5% Wednesday, their best showing since September 2011.

Whether or not Berkshire actually does buy back some of its own stock remains to be seen.

The company said late Tuesday that it would not buy back any shares until after it reports its second quarter earnings following the market close on Friday August 3 -- at the earliest.

Berkshire also said would keep a rule that prohibits the company from buying back stock if the purchases reduce the amount of cash it has to below $20 billion.

That shouldn't be a problem. Berkshire had more than $108 billion in cash and short-term Treasury holdings on its balance sheet as of the end of March. Berkshire, like many large American companies, has been hoarding money lately.

The company had $96.5 billion in cash at the end of the first quarter of 2017. That's why some have been pushing Berkshire to use the cash on stock buybacks, investments and acquisitions.

Its last major acquisition was the purchase of aerospace parts maker Precision Castparts for $37 billion in 2015.

Berkshire-backed Kraft Heinz (KHC) tried to buy Unilever (UL) last year but walked away from the deal after Unilever decided it wasn't interested.

Related: CEOs dumping stock even as companies buy it back

Even though Berkshire hasn't done a buyback of its own in more than five years, many companies that Berkshire has invested in, including Apple (AAPL), Coca-Cola (KO) and IBM (IBM), have frequently repurchased shares during the past few years.

Buffett has praised buybacks too. He defended the practice in last year's shareholder letter.

"Some people have come close to calling [buybacks] un-American -- characterizing them as corporate misdeeds that divert funds needed for productive endeavors. That simply isn't the case: Both American corporations and private investors are today awash in funds looking to be sensibly deployed," he wrote.

So don't be surprised if Berkshire -- which is clearly "awash in funds" -- soon decides to deploy some of them on a stock buyback.

Israel adopts divisive Jewish nation-state law - Reuters

JULY 19, 2018 / 10:35 AM
Israel adopts divisive Jewish nation-state law
Maayan Lubell

JERUSALEM (Reuters) - Israel passed a law on Thursday to declare that only Jews have the right of self-determination in the country, something members of the Arab minority called racist and verging on apartheid.

The “nation-state” law, backed by the right-wing government, passed by a vote of 62-55 and two abstentions in the 120-member parliament after months of political argument. Some Arab lawmakers shouted and ripped up papers after the vote.

“This is a defining moment in the annals of Zionism and the history of the state of Israel,” Prime Minister Benjamin Netanyahu told the Knesset after the vote.

Largely symbolic, the law was enacted just after the 70th anniversary of the birth of the state of Israel. It stipulates that “Israel is the historic homeland of the Jewish people and they have an exclusive right to national self-determination in it”.

The bill also strips Arabic of its designation as an official language alongside Hebrew, downgrading it to a “special status” that enables its continued use within Israeli institutions.

Israel’s Arabs number some 1.8 million, about 20 percent of the 9 million population.

Early drafts of the legislation went further in what critics at home and abroad saw as discrimination toward Israel’s Arabs, who have long said they are treated as second-class citizens.

Clauses that were dropped in last-minute political wrangling - and after objections by Israel’s president and attorney-general - would have enshrined in law the establishment of Jewish-only communities, and instructed courts to rule according to Jewish ritual law when there were no relevant legal precedents.

Instead, a more vaguely-worded version was approved, which says: “The state views the development of Jewish settlement as a national value and will act to encourage and promote its establishment.”

Even after the changes, critics said the new law will deepen a sense of alienation within the Arab minority.

“I announce with shock and sorrow the death of democracy,” Ahmed Tibi, an Arab lawmaker, told reporters.

Netanyahu has defended the law. “We will keep ensuring civil rights in Israel’s democracy but the majority also has rights and the majority decides,” he said last week.

“An absolute majority wants to ensure our state’s Jewish character for generations to come.”

Israel’s Arab population is comprised mainly of descendants of the Palestinians who remained on their land during the conflict between Arabs and Jews that culminated in the war of 1948 surrounding the creation of the modern state of Israel. Hundreds of thousands were forced to leave their homes or fled.

Those who remained have full equal rights under the law but say they face constant discrimination, citing inferior services and unfair allocations for education, health and housing.

In Ma’alot-Tarshiha, a municipality in northern Israel which was created by linking the Jewish town of Ma’alot and the Arab town of Tarshiha, there was anger among Arab residents.

“I think this is racist legislation by a radical right-wing government that is creating radical laws, and is planting the seeds to create an apartheid state,” said physician Bassam Bisharah, 71.

“The purpose of this law is discrimination. They want to get rid of the Arabs totally,” said Yousef Faraj, 53, from the nearby Druze village of Yanuh. “The Israelis want to destroy all the religions of the Arabs.”

Adalah, the Legal Center for Arab Minority Rights in Israel, called the law a bid to advance “ethnic superiority by promoting racist policies”.

Israeli population:

Salisbury poisoning: Police 'identify Novichok suspects' - BBC News

July 19, 2018

Salisbury poisoning: Police 'identify Novichok suspects'

Sergei Skripal, 66, and his daughter Yulia, 33, were poisoned in March, but both survived
Police believe they have identified the suspected perpetrators of the Novichok attack on a Russian ex-spy and his daughter in Salisbury in March.

Several Russians were involved in the attempted murder of Sergei and Yulia Skripal, according to the Press Association.

They have reportedly been identified through CCTV.

Earlier this month, Dawn Sturgess, 44, died after being poisoned by the same nerve agent, in Amesbury.

Her partner Charlie Rowley, 45, was also contaminated on 30 June and remains seriously ill in hospital.

Police believe the incidents are linked. The UK government has blamed Russia, but the country's authorities deny any involvement.

Mr Skripal, 66, and his daughter, 33, who were discovered slumped on a bench in Salisbury on 4 March, have been discharged from hospital and moved to secure locations.

"Investigators believe they have identified the suspected perpetrators of the Novichok attack through CCTV and have cross-checked this with records of people who entered the country around that time," a source with knowledge of the investigation told the Press Association.

"They (the investigators) are sure they (the suspects) are Russian."

The Met Police, who are leading the investigation, have declined to comment.

Dawn Sturgess and Charlie Rowley touched a contaminated item with their hands
An inquest into the death of Dawn Sturgess is due to open on Thursday.

Counter-terrorism detectives have revealed they found a small bottle containing Novichok at Mr Rowley's home in Muggleton Road, Amesbury.

They are trying to establish where the container, thought to be a bottle of perfume, originated from, and how Mr Rowley and Ms Sturgess first encountered it.

On Wednesday, international chemical weapons experts completed their investigations in Amesbury, where they sought to identify whether the substance which poisoned the couple was from the same batch used against the Skripals.

Media captionThe BBC's Gordon Corera considers how likely is it Russia poisoned Sergei Skripal and his daughter
The risk to the public remains low, according to Public Health England.

Mike Wade, deputy director for health protection in the South West, said: "The advice remains - if you didn't drop it, then don't pick it up."

Australia overtaking UK for overseas students - BBC News

July 19, 2018

Australia overtaking UK for overseas students
By Sean Coughlan
BBC News education and family correspondent

Students arriving in Melbourne - ranked this year as one of the world's best student cities
Australia is overtaking the UK as the world's second biggest destination for international students, says research from University College London.

Researchers at UCL's Centre for Global Higher Education say the UK is being pushed into third place behind the United States and Australia.

Australia has been rapidly expanding its international student numbers.

The British Council says it shows the UK needs to "look again" at its policies towards overseas students.

An analysis this year found that overseas students added £20bn to the UK's economy - and universities in the UK have warned that immigration rules after Brexit will need to be more welcoming for students.

Catching up
The UCL study has tracked the latest movements in international students and report author Professor Simon Marginson says Australia is moving ahead of the UK.

He warns that Canada is also catching up in taking a growing slice of the lucrative overseas student market.

Overseas students starting in Melbourne this year were invited to a welcome party and dance
Three years ago the UK was recruiting around 130,000 more overseas students than Australia, says Prof Marginson, who is also co-chair of the Higher Education Commission's current inquiry into international students.

But he says successive years of Australia having increases of 12% to 14% in overseas students have seen it catch up and overtake the UK, which has been growing much more slowly.

Official student figures for 2018 from the UN's education agency, Unesco, will not be published until after the end of this year.

But the UCL researchers are "certain" that Australia is on the verge of moving ahead of the UK in overseas students and this "may have already happened".

Best student cities
"UK higher education is still highly valued internationally, but the government has held down the growth of international student numbers for five years, by limiting new student numbers and post-study work visas," says Prof Marginson.

"Meanwhile, competitor nations are strongly promoting their international education."

Overseas students add £20bn to the economy
Door kept open to EU students after Brexit
London ranked best city for students
Trump's biggest fans? Canadian universities
Australia has been marketing itself as an English-speaking country with high-performing universities, with an attractive climate and a welcoming culture for overseas students.

This year's Best Student Cities rankings put Melbourne and Sydney in the top 10 - although London was the highest ranked of all.

Australia has succeeded in attracting students from outside Europe, particularly from China.

The research from UCL warns that the UK's future intake of international students will depend on keeping its appeal for European students.

Post-Brexit plans
Last week, the government set out post-Brexit plans that would keep open the door to visa-free travel for European Union students coming to UK universities.

But there was no detail on whether EU students would have to pay full international fees.

Universities in the UK have been campaigning for overseas students to be taken out of net migration figures.

A spokeswoman for the British Council said that international students are "an immense source of long-term influence and soft power for the UK".

She said the UK was competing with countries with "welcoming visa policies" and "comprehensive international education strategies".

With the approach of Brexit, she said "it has never been more important to reinforce and open up international channels for the UK".

White House insists Trump believes Russia still a threat - BBC News

White House insists Trump believes Russia still a threat
18 July 2018

President Trump was bombarded by questions as reporters were asked to leave
The White House has insisted it believes Russia still poses a threat to the US amid confusion over comments made by President Donald Trump.

Mr Trump appeared to disagree with US intelligence when he responded "no" to a question about whether Russia was still targeting American elections.

Later, White House Press Secretary Sarah Sanders said Mr Trump was saying "no" to answering more questions.

It comes amid a flurry of criticism over his recent comments about Russia.

"The president and his administration are working very hard to make sure that Russia is unable to meddle in our elections as they have done in the past," Mrs Sanders said at a news briefing on Wednesday.

What's the latest confusion?
Hours earlier, ABC News reporter Cecilia Vega asked the president whether Russia would still target American elections.

After he shook his head and replied, "Thank you very much, no", she again asked: "No? You don't believe that to be the case?"

He appeared to respond again: "No".

But Mrs Sanders rejected that interpretation later in a news briefing, telling reporters the White House was taking action to prevent any future meddling.

"We wouldn't actually spend as much time and effort as we are if we didn't believe that [Russia is] still looking at us," she said.

Later, Ms Vega tweeted that the president had been looking directly at her when he answered.

Cecilia Vega

 Getting a lot of questions about my exchange with @realDonaldTrump today.
Yes, he was looking directly at me when he spoke.
Yes, I believe he heard me clearly. He answered two of my questions.
Here’s the full exchange:

5:54 AM - Jul 19, 2018

NBC News' White House correspondent Hallie Jackson responded to Mrs Sander's explanation on Wednesday on Twitter, saying she had "never heard the president say 'no' in order to get us to stop".

Skip Twitter post by @HallieJackson

Hallie Jackson

 Here's the thing about what the @PressSec said about @POTUS "no" response: in the countless time I've been in the Oval or Cabinet Room or wherever trying to shout questions, I've never heard the president say "no' in order to get us to stop.

5:26 AM - Jul 19, 2018

The apparent response would put him at odds with US intelligence on claims of Russian interference in US elections for the second time since he met Russian President Vladimir Putin in Helsinki on Monday.

On Tuesday, Mr Trump said he misspoke during Monday's summit when he appeared to side with Mr Putin over claims of Kremlin meddling in US elections.

US intelligence chief Dan Coats said on Monday that Russia was involved in "ongoing, pervasive efforts to undermine our democracy".

He told a congressional committee in February he had already seen evidence that Russia was targeting the upcoming mid-term elections in November.

What has Trump said?
During an interview with CBS News' Jeff Glor on Wednesday afternoon, Mr Trump said that he would consider Mr Putin personally responsible for any Russian interference.

"Just like I consider myself to be responsible for things that happen in this country," he said. "So certainly as the leader of a country you would have to hold him responsible, yes."

Mr Trump added that he was "very strong on the fact that we can't have meddling" in his conversation with Russia's leader.

On Wednesday morning Mr Trump lashed out at "haters" who condemned his meeting with Russia's president, saying his critics were suffering from "Trump Derangement Syndrome".

Skip Twitter post by @realDonaldTrump

Donald J. Trump

 So many people at the higher ends of intelligence loved my press conference performance in Helsinki. Putin and I discussed many important subjects at our earlier meeting. We got along well which truly bothered many haters who wanted to see a boxing match. Big results will come!

7:53 PM - Jul 18, 2018

Donald J. Trump

 Some people HATE the fact that I got along well with President Putin of Russia. They would rather go to war than see this. It’s called Trump Derangement Syndrome!

9:27 PM - Jul 18, 2018

Despite the controversy, Republican voters seem to be sticking by Mr Trump.

'He is not a politician': US voters on the aftermath of the Trump-Putin summit
A Reuters/Ipsos poll this week found that despite a firestorm of media criticism, Mr Trump's Finland summit had no real impact on his overall approval ratings.

In the survey, 42% of all registered voters approved of his job performance, which is consistent with averages thus far.

Your toolkit to help understand the story
Trump's 'most serious mistake'
Montenegro hits back at 'stupid' Trump
Some 71% of Republicans polled approved of his response to Russia, while only 14% of Democrats were in favour.

What now?
US lawmakers are calling for a court demand to be issued for the notes of the US translator who accompanied Mr Trump to his two-hour meeting with Mr Putin.

Secretary of State Mike Pompeo is due to testify before the Senate next week about the summit.

Trump says he "misspoke" at Putin summit, but is it too late? Anthony Zurcher explains
Nancy Pelosi, Democratic leader in the House of Representatives, tried on Tuesday to stage a symbolic vote to support the findings of Russian interference, but was blocked by Republicans.

Senators Jeff Flake and Chris Coons, an Arizona Republican and a Delaware Democrat, are reportedly working on a nonbinding resolution to endorse the intelligence committee's findings.

But Texas Republican John Cornyn said the Senate should focus on "additional sanctions instead of just some messaging exercise".

What did Trump say at the summit?
During a news conference after Monday's summit, Mr Trump was asked about alleged Russian meddling in the US election.

According to a transcript posted by the White House, he said: "My people came to me... they said they think it's Russia. I have President Putin; he just said it's not Russia. I will say this: I don't see any reason why it would be."

The summit comments sparked a barrage of criticism from lawmakers across the political spectrum, with many calling on him to correct himself.

On Tuesday, Mr Trump said he had reviewed the transcript and realised he needed to clarify.

"The sentence should have been: 'I don't see any reason why I wouldn't' or 'why it wouldn't be Russia'. Sort of a double negative."

The ways Trump and Putin see eye to eye
Mr Trump said that the interference had had no impact on the election, in which he defeated Hillary Clinton.

However, he did not respond when reporters asked him if he would condemn Mr Putin.

Donald J. Trump

 While the NATO meeting in Brussels was an acknowledged triumph, with billions of dollars more being put up by member countries at a faster pace, the meeting with Russia may prove to be, in the long run, an even greater success. Many positive things will come out of that meeting..

8:08 PM - Jul 18, 2018

President Trump Tries a Tougher Stance on Russia Amid Putin Summit Backlash - TIME ( source : Associated Press )

July 19, 2018

President Trump Tries a Tougher Stance on Russia Amid Putin Summit Backlash

(WASHINGTON) — President Donald Trump spent a second day managing the political fallout from his widely criticized meeting with Russia’s Vladimir Putin, shifting stances and mopping up what the White House said were misstatements.

His toughness with the longtime American foe in question, Trump said Wednesday he told the Russian president face-to-face during Monday’s summit to stay out of America’s elections “and that’s the way it’s going to be.”

That rhetoric marked a turnabout from Trump’s first, upbeat description of his sit-down with Putin. Still, Trump backtracked on whether Russia is currently targeting U.S. elections. When asked the question Wednesday, he answered “no,” a reply that put him sharply at odds with recent public warnings from his own intelligence chief.

Hours later, the White House stepped in to say Trump’s answer wasn’t what it appeared.

The zigzagging laid bare the White House’s search for a path out of trouble that has dogged the administration’s discussions of Russia from the start, but spiraled after Trump’s trip to Helsinki. After days of criticism from both Democrats and Republicans, Trump — a politician who celebrates his brash political incorrectness — has appeared more sensitive than usual to outside opprobrium.

The White House says President Donald Trump believes Russia would target U.S. elections again, saying the “threat still exists.” That comes hours after Trump appeared to deny Russia was still targeting the United States.

The scale of the bipartisan outcry at Trump’s stance toward Putin has only been rivaled by his 2017 waffling over condemning white supremacist demonstrators in Charlottesville, Virginia.

“I let him know we can’t have this,” Trump told CBS News of his conversations with Putin. “We’re not going to have it, and that’s the way it’s going to be.”

Would he hold Putin personally responsible for further election interference? “I would, because he’s in charge of the country.”

The CBS interview came at the end of two days of shifting statements.

On Monday, Trump appeared to question the findings of U.S. intelligence agencies that Russia interfered in the 2016 election.

His reservations, expressed 18 months into his presidency and as he stood standing next to Putin on foreign soil, prompted blistering criticism at home, even from prominent fellow Republicans.

On Tuesday, he delivered a scripted statement to “clarify” — his word — his remarks Monday. He said he misspoke by one word when he said he saw no reason to believe Russia had interfered in the 2016 U.S. election.

On Wednesday, he was asked during a Cabinet meeting if Russia was still targeting the U.S., and he answered “no” without elaborating. That came just days after National Intelligence Director Dan Coats sounded an alarm, comparing the cyberthreat today to the way U.S. officials said before 9/11 that intelligence channels were “blinking red” with warning signs that a terror attack was imminent.

White House press secretary Sarah Huckabee Sanders said later Wednesday that Trump actually was saying “no” to answering additional questions — even though he subsequently went on to address Russia.

“The president is wrong,” GOP Sen. Susan Collins of Maine said of Trump’s one-word response. Told that Sanders had since clarified, she responded: “There’s a walk-back of the walk-back of the walk-back of the walk-back? This is dizzying.”

Trump has refined and sharpened his presentation in the two days since Helsinki.

At the news conference with Putin, he was asked if he would denounce what happened in 2016 and warn Putin never to do it again, and he did not directly answer. Instead, he went into a rambling response, including demands for investigation of Hillary Clinton’s email server and his description of Putin’s “extremely strong and powerful” denial of meddling.

Trump asserted Wednesday at the White House that no other American president has been as tough on Russia. He cited U.S. sanctions and the expulsion of alleged Russian spies from the U.S., telling reporters that Putin “understands it, and he’s not happy about it.”

The muddied waters have deepened critics’ concerns that Trump is not taking threats to the U.S. electoral system seriously enough. Pressed on why Trump has repeatedly passed on opportunities to publicly condemn Putin’s actions, Sanders suggested Trump was working to make the most of an “opportunity” for the two leaders to work together on shared interests.

One such opportunity is what Trump termed an “incredible offer” from Putin to allow the U.S. access to Russians accused of election hacking and other interference. In exchange, Putin wants Russian interviews of Americans accused by the Kremlin of unspecified crimes.

Sanders said Trump was still weighing the offer with his team, adding, “We’ve committed to nothing.” Russian officials have said they want to interview Kremlin critics Bill Browder and former U.S. Ambassador to Russia Michael McFaul.

McFaul tweeted Wednesday that he hoped the White House would denounce “this ridiculous request from Putin.”

Lawmakers have urged Trump to reject the deal.

“We’re going to make sure that Congress does everything it can to protect this country,” said Sen. Cory Gardner, R-Colo., who heads up the GOP’s campaign arm.

A number of senators are swiftly signing on to a bipartisan bill from Sens. Marco Rubio, R-Fla., and Chris Van Hollen, D-Md., that would slap new sanctions on Russia or any other country caught posting ads, running fake news or otherwise interfering with election infrastructure.

Sanders called the legislation “hypothetical” and declined to say whether the president would back it.

Van Hollen said Trump “isn’t willing to protect the integrity of our democracy in the United States, so Congress has to act.”

Two other lawmakers, Sens. Jeff Flake, R-Ariz., and Chris Coons, D-Del., will try to force a vote Thursday on a resolution backing the intelligence community’s findings that Russia interfered in the 2016 election and must be held accountable. A similar House vote Tuesday failed on a party-line vote.

The Republican chairman of the Senate intelligence committee, Richard Burr of South Carolina, said if Trump doubts that Russia would again try to intervene, “He needs to read the intelligence.”

At the Hudson Institute think tank in Washington last Friday, Coats said, “We are not yet seeing the kind of electoral interference in specific states and voter data bases that we experienced in 2016; however, we fully realize that we are just one click on a keyboard away from a similar situation repeating itself.”

His comments came the same day the Justice Department unveiled an indictment against 12 Russian military intelligence officers for their role in hacking Democratic groups during the 2016 campaign.

“The president was flat out wrong,” Michael Morell, former deputy and acting director of the CIA said about Trump’s remarks after the Cabinet meeting. “The Russians continue to interfere in our democracy. In fact, they never stopped.”

Contrary to the U.S. government’s fears leading up to the 2016 president election, hacking the nation’s election infrastructure appeared to take a back seat to stealing and leaking salacious documents from the Democratic National Committee and House Democrats’ campaign arm.

The success of the apparent dress rehearsal does not bode well for the upcoming election cycles in 2018 and 2020, as intelligence leaders have noted the ongoing and increasing threat by Russian hackers.

Federal officials ultimately determined that at least 18 states had their election systems targeted in some fashion, and possibly up to 21 found scanning of their networks for possible vulnerabilities, according to a report issued by the Senate Select Committee on Intelligence in May.

Wednesday, July 18, 2018

Trump Putin: US president defends meeting and press conference - BBC News

July 18, 2018

Trump Putin: US president defends meeting and press conference

The president said "Trump Derangement Syndrome" was to blame for the criticism
US President Donald Trump has defended his meeting with Russian President Vladimir Putin, amid a backlash over his performance.

On Twitter, Mr Trump condemned "haters" who did not want him getting along with Mr Putin, saying they suffered from "Trump Derangement Syndrome".

Mr Trump earlier admitted he misspoke at the press conference with Mr Putin.

He had appeared to back Mr Putin rather than his own intelligence services over claims of Russian election meddling.

That had sparked outrage from both sides of the political divide.

Posting on Twitter, Mr Trump said people "who wanted to see a boxing match" were bothered by his rapport with Mr Putin.

"They would rather go to war than see this!" he wrote.

Donald J. Trump

 So many people at the higher ends of intelligence loved my press conference performance in Helsinki. Putin and I discussed many important subjects at our earlier meeting. We got along well which truly bothered many haters who wanted to see a boxing match. Big results will come!

7:53 PM - Jul 18, 2018

Donald J. Trump

 Some people HATE the fact that I got along well with President Putin of Russia. They would rather go to war than see this. It’s called Trump Derangement Syndrome!

9:27 PM - Jul 18, 2018
The tweets came a day after Mr Trump said he had missed out a word when appearing to support Mr Putin's claim that there was no Russian involvement in the 2016 US presidential election.

President Trump said he accepted his intelligence services' assessment that Russia had interfered.

Trump sheds light on his crucial error at Putin summit
Your toolkit to help understand the story
Trump's 'most serious mistake'
Damage done
Analysis by the BBC's Anthony Zurcher in Washington

Does Donald Trump believe in ominous metaphors? As he affirmed his support for US intelligence agencies, the lights went to black in the White House conference room.

Once order was restored, he said he had been in the dark as to why a storm had swirled around his presidency since his Helsinki summit with Vladimir Putin. It was, he said, because he had misspoken.

That is going to be hard for many of the president's critics to swallow, however. Even if he did mean to say, "I don't see a reason why it wouldn't be Russia", it is a pretty weak way to confront the head of a nation accused of targeting the heart of American democracy.

What is more, the context of the president's comments make a simple slip of the tongue seem less likely.

At the very least, the president gave his supporters some material to rally around.

The damage, however, has been done. Mr Trump can give as many White House statements as he likes, but on the biggest stage - standing beside the Russian president - he fumbled. All the explanations cannot change that.

What Trump said then...
The controversy centres on a response he gave to a question at a news conference on Monday following the summit with Mr Putin.

This is an extract from the transcript posted by the White House.

REPORTER: President Putin denied having anything to do with the election interference in 2016. Every US intelligence agency has concluded that Russia did. My first question for you, sir, is, who do you believe?

Schwarzenegger calls Trump a 'wet noodle'
'Double negative' is not not trending
TRUMP: My people came to me... they said they think it's Russia. I have President Putin; he just said it's not Russia. I will say this: I don't see any reason why it would be.

.... what he says now
Mr Trump said he had reviewed the transcript and realised he needed to clarify.

"In a key sentence in my remarks, I said the word 'would' instead of 'wouldn't," he said.

"The sentence should have been: 'I don't see any reason why I wouldn't' or 'why it wouldn't be Russia'. Sort of a double negative."

The US president added: "I accept our intelligence community's conclusion that Russia's meddling in the 2016 election took place. Could be other people also. A lot of people out there."

Media captionThe ways Trump and Putin see eye to eye
Mr Trump said that the interference had had no impact on the election, in which he defeated Hillary Clinton.

However, he did not respond when reporters asked him if he would condemn Mr Putin.

During the press conference with President Putin - in the same answer as the transcript above - Mr Trump went on to say: "President Putin was extremely strong and powerful in his denial today. And what he did is an incredible offer; he offered to have the people working on the case come and work with their investigators with respect to the 12 people. I think that's an incredible offer."

In another tweet on Wednesday, Mr Trump said that Russia had "agreed to help with North Korea", adding that "the process is moving along".

"There is no rush, the sanctions remain! Big benefits and exciting future for North Korea at end of process!" the president wrote.

He said that his meeting with Mr Putin was "positive" and "may prove to be, in the long run... an even greater success".

Donald J. Trump

 While the NATO meeting in Brussels was an acknowledged triumph, with billions of dollars more being put up by member countries at a faster pace, the meeting with Russia may prove to be, in the long run, an even greater success. Many positive things will come out of that meeting..

8:08 PM - Jul 18, 2018
How great has been the outrage?
Chuck Schumer, leader of the opposition Democrats in the Senate, said Mr Trump's retraction of his previous comments was a sign of weakness.

"He made a horrible statement, tried to back off, but couldn't even bring himself to back off," he told the Senate. "It shows the weakness of President Trump that he is afraid to confront Mr Putin directly."

Skip Twitter post by @BBCSteveR

Steve Rosenberg

 Even the Russian press is stunned by Donald Trump's performance in Helsinki. One paper today is shocked that, in Putin's presence, Trump "publicly expressed a lack of trust in his own intelligence agencies. You don't do things like that. He'll pay a high political price."

6:26 PM - Jul 18, 2018

End of Twitter post by @BBCSteveR
Republicans and Democrats alike were dumbfounded that Mr Trump had sided with Russia over his own intelligence officials after Monday's summit.

The US and Russia have been long-term adversaries and remain far apart on major issues. Some lawmakers were also upset that Mr Trump had refused to offer specific criticisms of Russia and Mr Putin, instead saying both countries were responsible for poor relations.

Even one of his most loyal Republican supporters, Newt Gingrich, said the comments were the "most serious mistake of his presidency".

House Republican Mike Turner accused Mr Trump of having damaged American foreign policy by failing to take Russia to task.

"He's given them a pass and is certainly not holding them accountable for what they're doing," he added.

給兒子的信 - 梁繼璋

給兒子的信 - 梁繼璋
Joseph K. H. Cheng
July 16 at 3:34 AM · tagAdd Topics
給兒子的信 - 梁繼璋 ( HK DJ at a radio station )
(一) 對你不好的人,你不要太介懷,在你一生中,沒有人有義務要對你好,
(二) 沒有人是不可代替,沒有東西是必須擁有。看透了這一點,將來你身邊
(三) 生命是短暫的,今日你還在浪費著生命,明日會發覺生命已遠離你了。
(四) 世界上並沒有最愛這回事,愛情只是一種霎時的感覺,而這感覺絕對會
(五) 雖然,很多有成就的人士都没有受過很多教育,但並不等如不用功讀書,
(六) 我不會要求你供養我下半輩子,同樣地我也不會供養你的下半輩子,當
你長大到可以獨立的時候,我的責任已經完結。以後,你要坐巴士還是 Benz,
(七) 你可以要求自己守信,但不能要求別人守信,你可以要求自己對人好,
(八) 我買了十多二十年六合彩,還是一窮二白,連三獎也沒有中,這證明人
(九) 親人只有一次的緣份,無論這輩子我和你會相處多久,也請好好珍惜共

Former President Obama's full speech in South Africa - CBS News

July 17, 2018
Former President Obama's full speech in South Africa

Former President Barack Obama weighed in with his perspective on the "strange and uncertain times that we are in" as he delivered a major address in South Africa Tuesday. Mr. Obama was invited to give the 2018 Nelson Mandela Annual Lecture in Johannesburg, where he spoke to a large and enthusiastic crowd.

While his comments largely focused on the life lessons of the late South African leader Nelson Mandela (also known as Madiba) and the road ahead for global democracy, Mr. Obama also touched on the problem of racism, the "politics of fear," and the threat posed by rising authoritarianism. His remarks came just one day President Trump's controversial summit with Russian President Vladimir Putin amid the ongoing investigation into Russian interference in the 2016 election. 

Here is the full transcript of his address, as provided by the office of the former president:

PRESIDENT OBAMA: Thank you. To Mama Graça Machel, members of the Mandela family, the Machel family, to President Ramaphosa who you can see is inspiring new hope in this great country – (cheers and applause) – professor, doctor, distinguished guests, to Mama Sisulu and the Sisulu family, to the people of South Africa – (cheers and applause) – it is a singular honor for me to be here with all of you as we gather to celebrate the birth and life of one of history's true giants.

Let me begin by a correction – (laughter) – and a few confessions. The correction is that I am a very good dancer. (Laughter.) I just want to be clear about that. Michelle is a little better.

The confessions. Number one, I was not exactly invited to be here. I was ordered in a very nice way to be here by Graça Machel. (Cheers.)

Confession number two: I forgot my geography and the fact that right now it's winter in South Africa. (Laughter.) I didn't bring a coat, and this morning I had to send somebody out to the mall because I am wearing long johns. (Laughter.) I was born in Hawaii.

Confession number three: When my staff told me that I was to deliver a lecture, I thought back to the stuffy old professors in bow ties and tweed, and I wondered if this was one more sign of the stage of life that I'm entering, along with gray hair and slightly failing eyesight. I thought about the fact that my daughters think anything I tell them is a lecture. (Laughter.) I thought about the American press and how they often got frustrated at my long-winded answers at press conferences, when my responses didn't conform to two-minute soundbites. But given the strange and uncertain times that we are in – and they are strange, and they are uncertain – with each day's news cycles bringing more head-spinning and disturbing headlines, I thought maybe it would be useful to step back for a moment and try to get some perspective. So I hope you'll indulge me, despite the slight chill, as I spend much of this lecture reflecting on where we've been, and how we arrived at this present moment, in the hope that it will offer us a roadmap for where we need to go next.

One hundred years ago, Madiba was born in the village of M – oh, see there, I always get that – (laughter) – I got to get my Ms right when I'm in South Africa. Mvezo – I got it. (Cheers and applause.) Truthfully, it's because it's so cold my lips stuck. (Laughter.) So in his autobiography he describes a happy childhood; he's looking after cattle, he's playing with the other boys, eventually attends a school where his teacher gave him the English name Nelson. And as many of you know, he's quoted saying, "Why she bestowed this particular name upon me, I have no idea."

There was no reason to believe that a young black boy at this time, in this place, could in any way alter history. After all, South Africa was then less than a decade removed from full British control. Already, laws were being codified to implement racial segregation and subjugation, the network of laws that would be known as apartheid. Most of Africa, including my father's homeland, was under colonial rule. The dominant European powers, having ended a horrific world war just a few months after Madiba's birth, viewed this continent and its people primarily as spoils in a contest for territory and abundant natural resources and cheap labor. And the inferiority of the black race, an indifference towards black culture and interests and aspirations, was a given.

And such a view of the world – that certain races, certain nations, certain groups were inherently superior, and that violence and coercion is the primary basis for governance, that the strong necessarily exploit the weak, that wealth is determined primarily by conquest – that view of the world was hardly confined to relations between Europe and Africa, or relations between whites and blacks. Whites were happy to exploit other whites when they could. And by the way, blacks were often willing to exploit other blacks. And around the globe, the majority of people lived at subsistence levels, without a say in the politics or economic forces that determined their lives. Often they were subject to the whims and cruelties of distant leaders. The average person saw no possibility of advancing from the circumstances of their birth. Women were almost uniformly subordinate to men. Privilege and status was rigidly bound by caste and color and ethnicity and religion. And even in my own country, even in democracies like the United States, founded on a declaration that all men are created equal, racial segregation and systemic discrimination was the law in almost half the country and the norm throughout the rest of the country.

That was the world just 100 years ago. There are people alive today who were alive in that world. It is hard, then, to overstate the remarkable transformations that have taken place since that time. A second World War, even more terrible than the first, along with a cascade of liberation movements from Africa to Asia, Latin America, the Middle East, would finally bring an end to colonial rule. More and more peoples, having witnessed the horrors of totalitarianism, the repeated mass slaughters of the 20th century, began to embrace a new vision for humanity, a new idea, one based not only on the principle of national self-determination, but also on the principles of democracy and rule of law and civil rights and the inherent dignity of every single individual.

In those nations with market-based economies, suddenly union movements developed; and health and safety and commercial regulations were instituted; and access to public education was expanded; and social welfare systems emerged, all with the aim of constraining the excesses of capitalism and enhancing its ability to provide opportunity not just to some but to all people. And the result was unmatched economic growth and a growth of the middle class. And in my own country, the moral force of the civil rights movement not only overthrew Jim Crow laws but it opened up the floodgates for women and historically marginalized groups to reimagine themselves, to find their own voices, to make their own claims to full citizenship.

It was in service of this long walk towards freedom and justice and equal opportunity that Nelson Mandela devoted his life. At the outset, his struggle was particular to this place, to his homeland – a fight to end apartheid, a fight to ensure lasting political and social and economic equality for its disenfranchised non-white citizens. But through his sacrifice and unwavering leadership and, perhaps most of all, through his moral example, Mandela and the movement he led would come to signify something larger. He came to embody the universal aspirations of dispossessed people all around the world, their hopes for a better life, the possibility of a moral transformation in the conduct of human affairs.

Madiba's light shone so brightly, even from that narrow Robben Island cell, that in the late '70s he could inspire a young college student on the other side of the world to reexamine his own priorities, could make me consider the small role I might play in bending the arc of the world towards justice. And when later, as a law student, I witnessed Madiba emerge from prison, just a few months, you'll recall, after the fall of the Berlin Wall, I felt the same wave of hope that washed through hearts all around the world.

Do you remember that feeling? It seemed as if the forces of progress were on the march, that they were inexorable. Each step he took, you felt this is the moment when the old structures of violence and repression and ancient hatreds that had so long stunted people's lives and confined the human spirit – that all that was crumbling before our eyes. And then as Madiba guided this nation through negotiation painstakingly, reconciliation, its first fair and free elections; as we all witnessed the grace and the generosity with which he embraced former enemies, the wisdom for him to step away from power once he felt his job was complete, we understood that – (applause) – we understood it was not just the subjugated, the oppressed who were being freed from the shackles of the past. The subjugator was being offered a gift, being given a chance to see in a new way, being given a chance to participate in the work of building a better world.

And during the last decades of the 20th century, the progressive, democratic vision that Nelson Mandela represented in many ways set the terms of international political debate. It doesn't mean that vision was always victorious, but it set the terms, the parameters; it guided how we thought about the meaning of progress, and it continued to propel the world forward. Yes, there were still tragedies – bloody civil wars from the Balkans to the Congo. Despite the fact that ethnic and sectarian strife still flared up with heartbreaking regularity, despite all that as a consequence of the continuation of nuclear détente, and a peaceful and prosperous Japan, and a unified Europe anchored in NATO, and the entry of China into the world's system of trade – all that greatly reduced the prospect of war between the world's great powers. And from Europe to Africa, Latin America, Southeast Asia, dictatorships began to give way to democracies. The march was on. A respect for human rights and the rule of law, enumerated in a declaration by the United Nations, became the guiding norm for the majority of nations, even in places where the reality fell far short of the ideal. Even when those human rights were violated, those who violated human rights were on the defensive.

President Barack Obama -- Nelson Mandela speech
Former President Barack Obama speaks during the 2018 Nelson Mandela Annual Lecture in Johannesburg on Tue., July 17, 2018. GETTY
And with these geopolitical changes came sweeping economic changes. The introduction of market-based principles, in which previously closed economies along with the forces of global integration powered by new technologies, suddenly unleashed entrepreneurial talents to those that once had been relegated to the periphery of the world economy, who hadn't counted. Suddenly they counted. They had some power; they had the possibilities of doing business. And then came scientific breakthroughs and new infrastructure and the reduction of armed conflicts. And suddenly a billion people were lifted out of poverty, and once-starving nations were able to feed themselves, and infant mortality rates plummeted. And meanwhile, the spread of the internet made it possible for people to connect across oceans, and cultures and continents instantly were brought together, and potentially, all the world's knowledge could be in the hands of a small child in even the most remote village.

That's what happened just over the course of a few decades. And all that progress is real. It has been broad, and it has been deep, and it all happened in what – by the standards of human history – was nothing more than a blink of an eye. And now an entire generation has grown up in a world that by most measures has gotten steadily freer and healthier and wealthier and less violent and more tolerant during the course of their lifetimes.

It should make us hopeful. But if we cannot deny the very real strides that our world has made since that moment when Madiba took those steps out of confinement, we also have to recognize all the ways that the international order has fallen short of its promise. In fact, it is in part because of the failures of governments and powerful elites to squarely address the shortcomings and contradictions of this international order that we now see much of the world threatening to return to an older, a more dangerous, a more brutal way of doing business.

So we have to start by admitting that whatever laws may have existed on the books, whatever wonderful pronouncements existed in constitutions, whatever nice words were spoken during these last several decades at international conferences or in the halls of the United Nations, the previous structures of privilege and power and injustice and exploitation never completely went away. They were never fully dislodged. (Applause.) Caste differences still impact the life chances of people on the Indian subcontinent. Ethnic and religious differences still determine who gets opportunity from the Central Europe to the Gulf. It is a plain fact that racial discrimination still exists in both the United States and South Africa. (Cheers and applause.) And it is also a fact that the accumulated disadvantages of years of institutionalized oppression have created yawning disparities in income, and in wealth, and in education, and in health, in personal safety, in access to credit. Women and girls around the world continue to be blocked from positions of power and authority. (Cheers and applause.) They continue to be prevented from getting a basic education. They are disproportionately victimized by violence and abuse. They're still paid less than men for doing the same work. That's still happening. (Cheers and applause.) Economic opportunity, for all the magnificence of the global economy, all the shining skyscrapers that have transformed the landscape around the world, entire neighborhoods, entire cities, entire regions, entire nations have been bypassed.

In other words, for far too many people, the more things have changed, the more things stayed the same. (Applause.)

And while globalization and technology have opened up new opportunities, have driven remarkable economic growth in previously struggling parts of the world, globalization has also upended the agricultural and manufacturing sectors in many countries. It's also greatly reduced the demand for certain workers, has helped weaken unions and labor's bargaining power. It's made it easier for capital to avoid tax laws and the regulations of nation-states – can just move billions, trillions of dollars with a tap of a computer key.

And the result of all these trends has been an explosion in economic inequality. It's meant that a few dozen individuals control the same amount of wealth as the poorest half of humanity. (Applause.) That's not an exaggeration, that's a statistic. Think about that. In many middle-income and developing countries, new wealth has just tracked the old bad deal that people got because it reinforced or even compounded existing patterns of inequality, the only difference is it created even greater opportunities for corruption on an epic scale. And for once solidly middle-class families in advanced economies like the United States, these trends have meant greater economic insecurity, especially for those who don't have specialized skills, people who were in manufacturing, people working in factories, people working on farms.

In every country just about, the disproportionate economic clout of those at the top has provided these individuals with wildly disproportionate influence on their countries' political life and on its media; on what policies are pursued and whose interests end up being ignored. Now, it should be noted that this new international elite, the professional class that supports them, differs in important respects from the ruling aristocracies of old. It includes many who are self-made. It includes champions of meritocracy. And although still mostly white and male, as a group they reflect a diversity of nationalities and ethnicities that would have not existed a hundred years ago. A decent percentage consider themselves liberal in their politics, modern and cosmopolitan in their outlook. Unburdened by parochialism, or nationalism, or overt racial prejudice or strong religious sentiment, they are equally comfortable in New York or London or Shanghai or Nairobi or Buenos Aires, or Johannesburg. Many are sincere and effective in their philanthropy. Some of them count Nelson Mandela among their heroes. Some even supported Barack Obama for the presidency of the United States, and by virtue of my status as a former head of state, some of them consider me as an honorary member of the club. (Laughter.) And I get invited to these fancy things, you know? (Laughter.) They'll fly me out.

But what's nevertheless true is that in their business dealings, many titans of industry and finance are increasingly detached from any single locale or nation-state, and they live lives more and more insulated from the struggles of ordinary people in their countries of origin. (Applause.) And their decisions – their decisions to shut down a manufacturing plant, or to try to minimize their tax bill by shifting profits to a tax haven with the help of high-priced accountants or lawyers, or their decision to take advantage of lower-cost immigrant labor, or their decision to pay a bribe – are often done without malice; it's just a rational response, they consider, to the demands of their balance sheets and their shareholders and competitive pressures.

But too often, these decisions are also made without reference to notions of human solidarity – or a ground-level understanding of the consequences that will be felt by particular people in particular communities by the decisions that are made. And from their board rooms or retreats, global decision-makers don't get a chance to see sometimes the pain in the faces of laid-off workers. Their kids don't suffer when cuts in public education and health care result as a consequence of a reduced tax base because of tax avoidance. They can't hear the resentment of an older tradesman when he complains that a newcomer doesn't speak his language on a job site where he once worked. They're less subject to the discomfort and the displacement that some of their countrymen may feel as globalization scrambles not only existing economic arrangements, but traditional social and religious mores.

Which is why, at the end of the 20th century, while some Western commentators were declaring the end of history and the inevitable triumph of liberal democracy and the virtues of the global supply chain, so many missed signs of a brewing backlash – a backlash that arrived in so many forms. It announced itself most violently with 9/11 and the emergence of transnational terrorist networks, fueled by an ideology that perverted one of the world's great religions and asserted a struggle not just between Islam and the West but between Islam and modernity, and an ill-advised U.S. invasion of Iraq didn't help, accelerating a sectarian conflict. (Applause.) Russia, already humiliated by its reduced influence since the collapse of the Soviet Union, feeling threatened by democratic movements along its borders, suddenly started reasserting authoritarian control and in some cases meddling with its neighbors. China, emboldened by its economic success, started bristling against criticism of its human rights record; it framed the promotion of universal values as nothing more than foreign meddling, imperialism under a new name. Within the United States, within the European Union, challenges to globalization first came from the left but then came more forcefully from the right, as you started seeing populist movements – which, by the way, are often cynically funded by right-wing billionaires intent on reducing government constraints on their business interests – these movements tapped the unease that was felt by many people who lived outside of the urban cores; fears that economic security was slipping away, that their social status and privileges were eroding, that their cultural identities were being threatened by outsiders, somebody that didn't look like them or sound like them or pray as they did.

And perhaps more than anything else, the devastating impact of the 2008 financial crisis, in which the reckless behavior of financial elites resulted in years of hardship for ordinary people all around the world, made all the previous assurances of experts ring hollow – all those assurances that somehow financial regulators knew what they were doing, that somebody was minding the store, that global economic integration was an unadulterated good. Because of the actions taken by governments during and after that crisis, including, I should add, by aggressive steps by my administration, the global economy has now returned to healthy growth. But the credibility of the international system, the faith in experts in places like Washington or Brussels, all that had taken a blow.

And a politics of fear and resentment and retrenchment began to appear, and that kind of politics is now on the move. It's on the move at a pace that would have seemed unimaginable just a few years ago. I am not being alarmist, I am simply stating the facts. Look around. (Applause.) Strongman politics are ascendant suddenly, whereby elections and some pretense of democracy are maintained – the form of it – but those in power seek to undermine every institution or norm that gives democracy meaning. (Applause.) In the West, you've got far-right parties that oftentimes are based not just on platforms of protectionism and closed borders, but also on barely hidden racial nationalism. Many developing countries now are looking at China's model of authoritarian control combined with mercantilist capitalism as preferable to the messiness of democracy. Who needs free speech as long as the economy is going good? The free press is under attack. Censorship and state control of media is on the rise. Social media – once seen as a mechanism to promote knowledge and understanding and solidarity – has proved to be just as effective promoting hatred and paranoia and propaganda and conspiracy theories. (Applause.)

So on Madiba's 100th birthday, we now stand at a crossroads – a moment in time at which two very different visions of humanity's future compete for the hearts and the minds of citizens around the world. Two different stories, two different narratives about who we are and who we should be. How should we respond?

Should we see that wave of hope that we felt with Madiba's release from prison, from the Berlin Wall coming down – should we see that hope that we had as naïve and misguided? Should we understand the last 25 years of global integration as nothing more than a detour from the previous inevitable cycle of history – where might makes right, and politics is a hostile competition between tribes and races and religions, and nations compete in a zero-sum game, constantly teetering on the edge of conflict until full-blown war breaks out? Is that what we think?

Let me tell you what I believe. I believe in Nelson Mandela's vision. I believe in a vision shared by Gandhi and King and Abraham Lincoln. I believe in a vision of equality and justice and freedom and multi-racial democracy, built on the premise that all people are created equal, and they're endowed by our creator with certain inalienable rights. (Cheers and applause.) And I believe that a world governed by such principles is possible and that it can achieve more peace and more cooperation in pursuit of a common good. That's what I believe.

And I believe we have no choice but to move forward; that those of us who believe in democracy and civil rights and a common humanity have a better story to tell. And I believe this not just based on sentiment, I believe it based on hard evidence.

The fact that the world's most prosperous and successful societies, the ones with the highest living standards and the highest levels of satisfaction among their people, happen to be those which have most closely approximated the liberal, progressive ideal that we talk about and have nurtured the talents and contributions of all their citizens.

The fact that authoritarian governments have been shown time and time again to breed corruption, because they're not accountable; to repress their people; to lose touch eventually with reality; to engage in bigger and bigger lies that ultimately result in economic and political and cultural and scientific stagnation. Look at history. Look at the facts.

The fact that countries which rely on rabid nationalism and xenophobia and doctrines of tribal, racial or religious superiority as their main organizing principle, the thing that holds people together – eventually those countries find themselves consumed by civil war or external war. Check the history books.

The fact that technology cannot be put back in a bottle, so we're stuck with the fact that we now live close together and populations are going to be moving, and environmental challenges are not going to go away on their own, so that the only way to effectively address problems like climate change or mass migration or pandemic disease will be to develop systems for more international cooperation, not less. (Applause.)

We have a better story to tell. But to say that our vision for the future is better is not to say that it will inevitably win. Because history also shows the power of fear. History shows the lasting hold of greed and the desire to dominate others in the minds of men. Especially men. (Laughter and applause.) History shows how easily people can be convinced to turn on those who look different, or worship God in a different way. So if we're truly to continue Madiba's long walk towards freedom, we're going to have to work harder and we're going to have to be smarter. We're going to have to learn from the mistakes of the recent past. And so in the brief time remaining, let me just suggest a few guideposts for the road ahead, guideposts that draw from Madiba's work, his words, the lessons of his life.

First, Madiba shows those of us who believe in freedom and democracy we are going to have to fight harder to reduce inequality and promote lasting economic opportunity for all people. (Applause.)

Now, I don't believe in economic determinism. Human beings don't live on bread alone. But they need bread. And history shows that societies which tolerate vast differences in wealth feed resentments and reduce solidarity and actually grow more slowly; and that once people achieve more than mere subsistence, then they're measuring their well-being by how they compare to their neighbors, and whether their children can expect to live a better life. And when economic power is concentrated in the hands of the few, history also shows that political power is sure to follow – and that dynamic eats away at democracy. Sometimes it may be straight-out corruption, but sometimes it may not involve the exchange of money; it's just folks who are that wealthy get what they want, and it undermines human freedom.

And Madiba understood this. This is not new. He warned us about this. He said: "Where globalization means, as it so often does, that the rich and the powerful now have new means to further enrich and empower themselves at the cost of the poorer and the weaker, [then] we have a responsibility to protest in the name of universal freedom." That's what he said. (Applause.) So if we are serious about universal freedom today, if we care about social justice today, then we have a responsibility to do something about it. And I would respectfully amend what Madiba said. I don't do it often, but I'd say it's not enough for us to protest; we're going to have to build, we're going to have to innovate, we're going to have to figure out how do we close this widening chasm of wealth and opportunity both within countries and between them. (Applause.)

And how we achieve this is going to vary country to country, and I know your new president is committed to rolling up his sleeves and trying to do so. But we can learn from the last 70 years that it will not involve unregulated, unbridled, unethical capitalism. It also won't involve old-style command-and-control socialism form the top. That was tried; it didn't work very well. For almost all countries, progress is going to depend on an inclusive market-based system – one that offers education for every child; that protects collective bargaining and secures the rights of every worker – (applause) – that breaks up monopolies to encourage competition in small and medium-sized businesses; and has laws that root out corruption and ensures fair dealing in business; that maintains some form of progressive taxation so that rich people are still rich but they're giving a little bit back to make sure that everybody else has something to pay for universal health care and retirement security, and invests in infrastructure and scientific research that builds platforms for innovation.

I should add, by the way, right now I'm actually surprised by how much money I got, and let me tell you something: I don't have half as much as most of these folks or a tenth or a hundredth. There's only so much you can eat. There's only so big a house you can have. (Cheers and applause.) There's only so many nice trips you can take. I mean, it's enough. (Laughter.) You don't have to take a vow of poverty just to say, "Well, let me help out and let a few of the other folks – let me look at that child out there who doesn't have enough to eat or needs some school fees, let me help him out. I'll pay a little more in taxes. It's okay. I can afford it." (Cheers and applause.)

I mean, it shows a poverty of ambition to just want to take more and more and more, instead of saying, "Wow, I've got so much. Who can I help? How can I give more and more and more?" (Cheers and applause.) That's ambition. That's impact. That's influence. What an amazing gift to be able to help people, not just yourself. (Applause.) Where was I? I ad-libbed. (Laughter.) You get the point.

It involves promoting an inclusive capitalism both within nations and between nations. And as we pursue, for example, the Sustainable Development Goals, we have to get past the charity mindset. We've got to bring more resources to the forgotten pockets of the world through investment and entrepreneurship, because there is talent everywhere in the world if given an opportunity. (Cheers and applause.)

When it comes to the international system of commerce and trade, it's legitimate for poorer countries to continue to seek access to wealthier markets. And by the way, wealthier markets, that's not the big problem that you're having – that a small African country is sending you tea and flowers. That's not your biggest economic challenge. It's also proper for advanced economies like the United States to insist on reciprocity from nations like China that are no longer solely poor countries, to make sure that they're providing access to their markets and that they stop taking intellectual property and hacking our servers. (Laughter.)

But even as there are discussions to be had around trade and commerce, it's important to recognize this reality: while the outsourcing of jobs from north to south, from east to west, while a lot of that was a dominant trend in the late 20th century, the biggest challenge to workers in countries like mine today is technology. And the biggest challenge for your new president when we think about how we're going to employ more people here is going to be also technology, because artificial intelligence is here and it is accelerating, and you're going to have driverless cars, and you're going to have more and more automated services, and that's going to make the job of giving everybody work that is meaningful tougher, and we're going to have to be more imaginative, and the pact of change is going to require us to do more fundamental reimagining of our social and political arrangements, to protect the economic security and the dignity that comes with a job. It's not just money that a job provides; it provides dignity and structure and a sense of place and a sense of purpose. (Applause.) And so we're going to have to consider new ways of thinking about these problems, like a universal income, review of our workweek, how we retrain our young people, how we make everybody an entrepreneur at some level. But we're going to have to worry about economics if we want to get democracy back on track.

Second, Madiba teaches us that some principles really are universal – and the most important one is the principle that we are bound together by a common humanity and that each individual has inherent dignity and worth.

Now, it's surprising that we have to affirm this truth today. More than a quarter century after Madiba walked out of prison, I still have to stand here at a lecture and devote some time to saying that black people and white people and Asian people and Latin American people and women and men and gays and straights, that we are all human, that our differences are superficial, and that we should treat each other with care and respect. I would have thought we would have figured that out by now. I thought that basic notion was well established. (Applause.) But it turns out, as we're seeing in this recent drift into reactionary politics, that the struggle for basic justice is never truly finished. So we've got to constantly be on the lookout and fight for people who seek to elevate themselves by putting somebody else down. And by the way, we also have to actively resist – this is important, particularly in some countries in Africa like my own father's homeland; I've made this point before – we have to resist the notion that basic human rights like freedom to dissent, or the right of women to fully participate in the society, or the right of minorities to equal treatment, or the rights of people not to be beat up and jailed because of their sexual orientation – we have to be careful not to say that somehow, well, that doesn't apply to us, that those are Western ideas rather than universal imperatives. (Applause.)

Again, Madiba, he anticipated things. He knew what he was talking about. In 1964, before he received the sentence that condemned him to die in prison, he explained from the dock that, "The Magna Carta, the Petition of Rights, the Bill of Rights are documents which are held in veneration by democrats throughout the world." In other words, he didn't say well, those books weren't written by South Africans so I just – I can't claim them. No, he said that's part of my inheritance. That's part of the human inheritance. That applies here in this country, to me, and to you. And that's part of what gave him the moral authority that the apartheid regime could never claim, because he was more familiar with their best values than they were. (Laughter.) He had read their documents more carefully than they had. And he went on to say, "Political division based on color is entirely artificial and, when it disappears, so will the domination of one color group by another." That's Nelson Mandela speaking in 1964, when I was three years old. (Applause.)

What was true then remains true today. Basic truths do not change. It is a truth that can be embraced by the English, and by the Indian, and by the Mexican and by the Bantu and by the Luo and by the American. It is a truth that lies at the heart of every world religion – that we should do unto others as we would have them do unto us. (Applause.) That we see ourselves in other people. That we can recognize common hopes and common dreams. And it is a truth that is incompatible with any form of discrimination based on race or religion or gender or sexual orientation. And it is a truth that, by the way, when embraced, actually delivers practical benefits, since it ensures that a society can draw upon the talents and energy and skill of all its people. And if you doubt that, just ask the French football team that just won the World Cup. (Cheers and applause.) Because not all of those folks – not all of those folks look like Gauls to me. (Laughter.) But they're French. They're French. (Laughter.)

Embracing our common humanity does not mean that we have to abandon our unique ethnic and national and religious identities. Madiba never stopped being proud of his tribal heritage. He didn't stop being proud of being a black man and being a South African. But he believed, as I believe, that you can be proud of your heritage without denigrating those of a different heritage. (Applause.) In fact, you dishonor your heritage. It would make me think that you're a little insecure about your heritage if you've got to put somebody else's heritage down. (Laughter.) Yeah, that's right. (Laughter.) Don't you get a sense sometimes – again, I'm ad-libbing here – that these people who are so intent on putting people down and puffing themselves up that they're small-hearted, that there's something they're just afraid of. Madiba knew that we cannot claim justice for ourselves when it's only reserved for some. Madiba understood that we can't say we've got a just society simply because we replaced the color of the person on top of an unjust system, so the person looks like us even though they're doing the same stuff, and somehow now we've got justice. That doesn't work. (Cheers and applause.) It's not justice if now you're on top, so I'm going to do the same thing that those folks were doing to me and now I'm going to do it to you. That's not justice. "I detest racialism," he said, "whether it comes from a black man or a white man."

Now, we have to acknowledge that there is disorientation that comes from rapid change and modernization, and the fact that the world has shrunk, and we're going to have to find ways to lessen the fears of those who feel threatened. In the West's current debate around immigration, for example, it's not wrong to insist that national borders matter; whether you're a citizen or not is going to matter to a government, that laws need to be followed; that in the public realm newcomers should make an effort to adapt to the language and customs of their new home. Those are legitimate things and we have to be able to engage people who do feel as if things are not orderly. But that can't be an excuse for immigration policies based on race, or ethnicity, or religion. There's got to be some consistency. And we can enforce the law while respecting the essential humanity of those who are striving for a better life. (Cheers and applause.) For a mother with a child in her arms, we can recognize that could be somebody in our family, that could be my child.

Third, Madiba reminds us that democracy is about more than just elections.

When he was freed from prison, Madiba's popularity – well, you couldn't even measure it. He could have been president for life. Am I wrong? (Laughter.) Who was going to run against him? (Laughter.) I mean, Ramaphosa was popular, but come on. (Laughter.) Plus he was a young – he was too young. Had he chose, Madiba could have governed by executive fiat, unconstrained by check and balances. But instead he helped guide South Africa through the drafting of a new Constitution, drawing from all the institutional practices and democratic ideals that had proven to be most sturdy, mindful of the fact that no single individual possesses a monopoly on wisdom. No individual – not Mandela, not Obama – are entirely immune to the corrupting influences of absolute power, if you can do whatever you want and everyone's too afraid to tell you when you're making a mistake. No one is immune from the dangers of that.

Mandela understood this. He said, "Democracy is based on the majority principle. This is especially true in a country such as ours where the vast majority have been systematically denied their rights. At the same time, democracy also requires the rights of political and other minorities be safeguarded." He understood it's not just about who has the most votes. It's also about the civic culture that we build that makes democracy work.

So we have to stop pretending that countries that just hold an election where sometimes the winner somehow magically gets 90 percent of the vote because all the opposition is locked up – (laughter) – or can't get on TV, is a democracy. Democracy depends on strong institutions and it's about minority rights and checks and balances, and freedom of speech and freedom of expression and a free press, and the right to protest and petition the government, and an independent judiciary, and everybody having to follow the law.

And yes, democracy can be messy, and it can be slow, and it can be frustrating. I know, I promise. (Laughter.) But the efficiency that's offered by an autocrat, that's a false promise. Don't take that one, because it leads invariably to more consolidation of wealth at the top and power at the top, and it makes it easier to conceal corruption and abuse. For all its imperfections, real democracy best upholds the idea that government exists to serve the individual and not the other way around. (Applause.) And it is the only form of government that has the possibility of making that idea real.

So for those of us who are interested in strengthening democracy, let's also stop – it's time for us to stop paying all of our attention to the world's capitals and the centers of power and to start focusing more on the grassroots, because that's where democratic legitimacy comes from. Not from the top down, not from abstract theories, not just from experts, but from the bottom up. Knowing the lives of those who are struggling.

As a community organizer, I learned as much from a laid-off steel worker in Chicago or a single mom in a poor neighborhood that I visited as I learned from the finest economists in the Oval Office. Democracy means being in touch and in tune with life as it's lived in our communities, and that's what we should expect from our leaders, and it depends upon cultivating leaders at the grassroots who can help bring about change and implement it on the ground and can tell leaders in fancy buildings, this isn't working down here.

And to make democracy work, Madiba shows us that we also have to keep teaching our children, and ourselves – and this is really hard – to engage with people not only who look different but who hold different views. This is hard. (Applause.)

Most of us prefer to surround ourselves with opinions that validate what we already believe. You notice the people who you think are smart are the people who agree with you. (Laughter.) Funny how that works. But democracy demands that we're able also to get inside the reality of people who are different than us so we can understand their point of view. Maybe we can change their minds, but maybe they'll change ours. And you can't do this if you just out of hand disregard what your opponents have to say from the start. And you can't do it if you insist that those who aren't like you – because they're white, or because they're male – that somehow there's no way they can understand what I'm feeling, that somehow they lack standing to speak on certain matters.

Madiba, he lived this complexity. In prison, he studied Afrikaans so that he could better understand the people who were jailing him. And when he got out of prison, he extended a hand to those who had jailed him, because he knew that they had to be a part of the democratic South Africa that he wanted to build. "To make peace with an enemy," he wrote, "one must work with that enemy, and that enemy becomes one's partner."

So those who traffic in absolutes when it comes to policy, whether it's on the left or the right, they make democracy unworkable. You can't expect to get 100 percent of what you want all the time; sometimes, you have to compromise. That doesn't mean abandoning your principles, but instead it means holding on to those principles and then having the confidence that they're going to stand up to a serious democratic debate. That's how America's Founders intended our system to work – that through the testing of ideas and the application of reason and proof it would be possible to arrive at a basis for common ground.

And I should add for this to work, we have to actually believe in an objective reality. This is another one of these things that I didn't have to lecture about. You have to believe in facts. (Laughter.) Without facts, there is no basis for cooperation. If I say this is a podium and you say this is an elephant, it's going to be hard for us to cooperate. (Laughter.) I can find common ground for those who oppose the Paris Accords because, for example, they might say, well, it's not going to work, you can't get everybody to cooperate, or they might say it's more important for us to provide cheap energy for the poor, even if it means in the short term that there's more pollution. At least I can have a debate with them about that and I can show them why I think clean energy is the better path, especially for poor countries, that you can leapfrog old technologies. (Cheers.) I can't find common ground if somebody says climate change is just not happening, when almost all of the world's scientists tell us it is. I don't know where to start talking to you about this. (Laughter.) If you start saying it's an elaborate hoax, I don't know what to – (laughter) – where do we start?

Unfortunately, too much of politics today seems to reject the very concept of objective truth. People just make stuff up. They just make stuff up. We see it in state-sponsored propaganda; we see it in internet driven fabrications, we see it in the blurring of lines between news and entertainment, we see the utter loss of shame among political leaders where they're caught in a lie and they just double down and they lie some more. Politicians have always lied, but it used to be if you caught them lying they'd be like, "Oh man." Now they just keep on lying.

By the way, this is what I think Mama Graça was talking about in terms of maybe some sense of humility that Madiba felt, like sometimes just basic stuff, me not completely lying to people seems pretty basic, I don't think of myself as a great leader just because I don't completely make stuff up. You'd think that was a base line. Anyway, we see it in the promotion of anti-intellectualism and the rejection of science from leaders who find critical thinking and data somehow politically inconvenient. And, as with the denial of rights, the denial of facts runs counter to democracy, it could be its undoing, which is why we must zealously protect independent media; and we have to guard against the tendency for social media to become purely a platform for spectacle, outrage, or disinformation; and we have to insist that our schools teach critical thinking to our young people, not just blind obedience.

Which, I'm sure you are thankful for, leads to my final point: we have to follow Madiba's example of persistence and of hope.

It is tempting to give in to cynicism: to believe that recent shifts in global politics are too powerful to push back; that the pendulum has swung permanently. Just as people spoke about the triumph of democracy in the 90s, now you are hearing people talk about end of democracy and the triumph of tribalism and the strong man. We have to resist that cynicism.

Because, we've been through darker times, we've been in lower valleys and deeper valleys. Yes,  by the end of his life, Madiba embodied the successful struggle for human rights, but the journey was not easy, it wasn't pre-ordained. The man went to prison for almost three decades. He split limestone in the heat, he slept in a small cell, and was repeatedly put in solitary confinement. And I remember talking to some of his former colleagues saying how they hadn't realized when they were released, just the sight of a child, the idea of holding a child, they had missed – it wasn't something available to them, for decades.

And yet his power actually grew during those years – and the power of his jailers diminished, because he knew that if you stick to what's true, if you know what's in your heart, and you're willing to sacrifice for it, even in the face of overwhelming odds, that it might not happen tomorrow, it might not happen in the next week, it might not even happen in your lifetime. Things may go backwards for a while, but ultimately, right makes might, not the other way around, ultimately, the better story can win out and as strong as Madiba's spirit may have been, he would not have sustained that hope had he been alone in the struggle, part of buoyed him up was that he knew that each year, the ranks of freedom fighters were replenishing, young men and women, here in South African, in the ANC and beyond; black and Indian and white, from across the countryside, across the continent, around the world, who in those most difficult days would keep working on behalf of his vision.

And that's what we need right now, we don't just need one leader, we don't just need one inspiration, what we badly need right now is that collective spirit. And, I know that those young people, those hope carriers are gathering around the world. Because history shows that whenever progress is threatened, and the things we care about most are in question, we should heed the words of Robert Kennedy – spoken here in South Africa, he said, "Our answer is the world's hope: it is to rely on youth. It's to rely on the spirit of the young."

So, young people, who are in the audience, who are listening, my message to you is simple, keep believing, keep marching, keep building, keep raising your voice. Every generation has the opportunity to remake the world. Mandela said, "Young people are capable, when aroused, of bringing down the towers of oppression and raising the banners of freedom." Now is a good time to be aroused. Now is a good time to be fired up.

And, for those of us who care about the legacy that we honor here today – about equality and dignity and democracy and solidarity and kindness, those of us who remain young at heart, if not in body – we have an obligation to help our youth succeed. Some of you know, here in South Africa, my Foundation is convening over the last few days, two hundred young people from across this continent who are doing the hard work of making change in their communities; who reflect Madiba's values, who are poised to lead the way.

People like Abaas Mpindi, a journalist from Uganda, who founded the Media Challenge Initiative, to help other young people get the training they need to tell the stories that the world needs to know.

People like Caren Wakoli, an entrepreneur from Kenya, who founded the Emerging Leaders Foundation to get young people involved in the work of fighting poverty and promoting human dignity.

People like Enock Nkulanga, who directs the African Children's mission, which helps children in Uganda and Kenya get the education that they need and then in his spare time, Enock advocates for the rights of children around the globe, and founded an organization called LeadMinds Africa, which does exactly what it says.

You meet these people, you talk to them, they will give you hope. They are taking the baton, they know they can't just rest on the accomplishments of the past, even the accomplishments of those as momentous as Nelson Mandela's. They stand on the shoulders of those who came before, including that young black boy born 100 years ago, but they know that it is now their turn to do the work.

Madiba reminds us that: "No one is born hating another person because of the color of his skin, or his background, or his religion. People must learn to hate, and if they can learn to hate, they can be taught to love, for love comes more naturally to the human heart." Love comes more naturally to the human heart, let's remember that truth. Let's see it as our North Star, let's be joyful in our struggle to make that truth manifest here on earth so that in 100 years from now, future generations will look back and say, "they kept the march going, that's why we live under new banners of freedom." Thank you very much, South Africa, thank you.