>>> HELLO, EVERYONE, AND WELCOME TO "AMANPOUR AND COMPANY."

HERE'S WHAT IS COMING UP.

STRIKES CONTINUE ACROSS THE MIDDLE EAST.

I ASK REGIONAL EXPERTS MORAN KANYAVA AND KAREN YOUNG, COULD THE GOAL STATES BE DRAWN INTO THE WAR?

>>> AND THEN, EXTRAORDINARY DEVASTATION IN SOUTH LEBANON.

CORRESPONDENT NICK PAYTON WALSH REPORTS.

>>> AND -- >> IT WAS, AT THE END OF THE LINE, VERY MUCH THE END OF THE LINE.

THEY HAVE NO MONEY, THEY HAVE NOWHERE ELSE.

>> THE WHITE HOUSE SETS ITS SIGHTS ON CUBA AS A U.S.

IMPOSED BLOCKADE CRIPPLES THE U.S.

ECONOMY.

FORMER AMBASSADOR TO CUBA BRINGS HIS SORE PERSPECTIVE TO TODAY'S CRISIS.

>>> ALSO -- >> HOW DOES IT AFFECT THE ECONOMY?

SOMEWHAT, BUT NOT QUITE AS MUCH MARKET HEADLINES.

>> ECONOMIST JASON FURMAN TELLS WALTER ISAACSON, FEARS OF AN IRAN SHOCK TO THE U.S.

ECONOMY MAY BE EXAGGERATED.

>> "AMANPOUR AND COMPANY" IS MADE POSSIBLE BY THE ANDERSON FAMILY ENDOWMENT, JIM ATTWOOD AND LESLIE WILLIAMS, CANDACE KING WEIR, THE SYLVIA A. AND SIMON B. POYTA PROGRAMMING ENDOWMENT TO FIGHT ANTISEMITISM, THE STRAUS FAMILY FOUNDATION, MARK J. BLECHNER, THE FILOMEN M. D'AGOSTINO FOUNDATION, SETON J. MELVIN, THE PETER G. PETERSON AND JOAN GANZ COONEY FUND, CHARLES YUEN, COMMITTED TO BRIDGING CULTURAL DIFFERENCES IN OUR COMMUNITIES, BARBARA HOPE ZUCKERBERG, AND BY CONTRIBUTIONS TO YOUR PBS STATION FROM VIEWERS LIKE YOU.

THANK YOU!

>> A VERY WARM WELCOME TO THE PROGRAM, EVERYONE, I AM PAULINE IN NEW YORK SITTING IN FOR CHRISTIANE AMANPOUR.

WHILE PRESIDENT TRUMP SAYS HE IS IN THE THROES OF A REAL POSSIBILITY OF MAKING A DEAL WITH IRAN, LEADING INDICATORS POINT TWO MORE WAR.

ISRAEL AND THE U.S.

CARRIED OUT A WAVE OF STRIKES ACROSS IRAN, AS DEFENSE MINISTER ISRAEL CAT SAYS ATTACKS ARE CONTINUING WITH FULL FORCE.

IRAN LAUNCHED A FULL BARRAGE OF MISSILES AT ISRAEL OVERNIGHT SENDING RESCUE TEAMS TO SEVERAL SITES OF IMPACT, THAT IS ACCORDING TO ISRAEL'S DEFENSE FORCES AND KUWAIT, BAHRAIN, SAUDI ARABIA ALL REPORT MISSILE AND DRONE ATTACKS.

AS "THE WALL STREET JOURNAL" REPORTS THAT GOAL STATES ARE INCHING TOWARD JOINING THE FIGHT AGAINST IRAN.

THEN, THERE IS GLOBAL OIL OVER $100 PER BARREL AS THE MARKET SEES NO QUICK END TO THIS CONFLICT.

SO, WHAT IS THE CALCULUS FOR GULF STATE LEADERS, WEIGHING WHETHER TO JOIN THE WAR, AND FOR ORIOLE TRADERS, SETTING PRICES IN A VERY VOLATILE MARKET?

HERE TO DISCUSS, THE PRESS PROFESSOR OF GOVERNMENT AT GEORGETOWN UNIVERSITY IN QATAR, AND KAREN YOUNG, A SENIOR RESEARCH SCHOLAR AT THE CENTER OF GLOBAL ENERGY AT COLUMBIA UNIVERSITY AND I WANT TO THANK BOTH OF YOU FOR JOINING US.

FIRST TO YOU IN DOJA FROM WHERE YOU SIT, I AM WONDERING, DO YOU BELIEVE WE ARE NOW AT A LIKELY POINT OF ESCALATION OR DE- ESCALATION?

AND I WANT TO SPECIFICALLY POINT 23 PIVOTS, HERE.

TO THE TALKS THAT PRESIDENT TRUMP SPEAK OF HAVE ANY CHANCE OF SUCCEEDING?

ARE THE GULF STATES, INCLUDING SAUDI ARABIA, INCHING CLOSER TO JOINING THE WAR, AS "THE WALL STREET JOURNAL" SUGGESTS?

AND CRUCIALLY, DESPITE ITS ODDS THAT IRAN'S LEADERS ARE INTERESTED IN THE DEAL?

>> WELL, WE ARE CERTAINLY A LOT CLOSER TO DE-ESCALATION TODAY THAN WE WERE A COUPLE OF DAYS AGO.

HERE, IN DOJA, WE HAVEN'T HAD ANY ATTACKS, FOR NOW GOING INTO 48 HOURS, AT LEAST NO OVERHEAD EXPLOSIONS, AND IT APPEARS THAT WE ARE IN A BETTER PLACE TODAY THAN WE WERE 12 HOURS OR 24 HOURS AGO.

IT DOES OF COURSE APPEAR THAT SAUDI ARABIA AND THE UAE HAVE TAKEN A FAR MORE AGGRESSIVE STANCE TOWARD IRAN, PARTICULARLY OVER THE LAST 48 HOURS.

MORE THAN THEY HAD IN THE PAST.

BUT, I THINK THEY ARE QUITE WEARY THAT, AT ANY MOMENT, IF THEY ENTER THE WAR, AMERICA AND SO, WITH PRESIDENT TRUMP BEING VERY UNPREDICTABLE AND USING HIS UNPREDICTABILITY AS A SOURCE OF STRENGTH, I THINK THE PERSIAN GULF ARE QUITE WORRIED THAT IF THEY WERE TO ENTER THE WAR, THEN THEY WOULD BE LEFT ON THEIR OWN, WITHOUT AMERICAN COVER, AND THEN THEY WOULD BE GOING TO WAR WITH A NEIGHBOR AND THAT WOULD HAVE LONG-TERM CONSEQUENCES FOR THE REGION.

>> SO, DE-ESCALATION, BUT CERTAINLY AT A POINT OF GREAT UNCERTAINTY, AND KAREN, SO MUCH OF WHAT IS SHAPING THE CONFLICT HAS TO DO WITH WHAT THE HEAD OF THE IEA IS A CRISIS WORTHY OF THE TWO OIL SHOCKS OF THE 1970s, COMBINED!

I MEAN, IT'S EXTRAORDINARY COMMENTS, THERE.

AND HE ADDS THAT THIS COULD, INDEED, POSE A MAJOR THREAT TO THE WORLD ECONOMY.

AND YOU HAVE POINTED OUT, MANY TIMES, THAT THIS IS NOT JUST OIL, THERE IS NATURAL GAS, WHAT WOULD ESCALATION MEAN FOR THE ENERGY ARCHITECTURE?

AN ENERGY ARCHITECTURE THAT, AT THIS HOUR, IS STILL VERY DEPENDENT ON THE STRIAT OF HORMUZ?

>> WELL, I THINK IRAN WAS ACTUALLY TALKING ABOUT THE DIFFERENCE BETWEEN THE GCC STATES, THEIR EXPOSURE AND THE HITS THEY HAVE EXPERIENCED, SO QATAR HAS HAD THIS VERY, YOU KNOW, SEVERE ATTACK ON ITS LNG EXPORT ABILITIES, THE ATTACK ON KUWAIT, IRAQ, NOT GETTING OUT OF ANY OIL OUT OF CUBAN- AMERICANS BUT THE UAE AND SAUDI ARABIA HAVE THESE PIPELINES SO WHERE WE SEE POTENTIAL ESCALATION IS IF WE SEE ATTACKS ON REAL PRODUCTION SITES, AND THE ENERGY CONDUITS THAT GET OIL OUT, AWAY FROM THE STRAIT, INTO THE INDIAN OCEAN, INTO THE RED SEA CORRIDOR.

THAT WOULD BE AN ESCORT TORI POINT WHERE DO THINK WE WOULD SEE REACTIONS AN ENTRY POINT TO THE WAR, FOR SAUDI ARABIA AND THE UAE.

THIS IS A MAJOR DISRUPTION TO ENERGY MARKETS, THAT IS ABSOLUTELY TRUE, BUT IS NOT A TRANSPORT PROBLEM SO WE ARE STILL AT THE POINT WHERE WE COULD SEE A DECENT RECOVERY.

MOST ANALYSTS SEE OIL PRICES STAYING QUITE HIGH FOR SOME TIME, UNTIL 2028, EVEN WITH A RESOLUTION OF THIS CONFLICT AND A RESUMPTION OF CLOSE --FLOWS IN THE NEXT 6 TO 10 WEEKS, WE ARE LOOKING AT OIL PRICES WITH US BETWEEN $180 PER BAIL, FOR SOME PROLONGED PERIOD TOWARD THE END OF 2027.

SO, THAT IS WITH THINGS NOT REALLY HITTING MAJOR INFRASTRUCTURE DAMAGE.

WITH THE EXTRACTION OF -- YOU MENTIONED OTHER PRODUCTS, SO, WE HAVE OIL, WE HAVE REFINED PRODUCTS INCLUDING JET FUEL, DIESEL, WHICH HAVE REALLY BEEN SORT OF PRICE SPIKING BECAUSE THAT IS WHERE COMING OUT OF REFINERIES IN KUWAIT NOT GETTING THROUGH THE STRAIT RIGHT NOW AND ASSOCIATED GAS PRODUCTS LIKE HELIUM AND MANUFACTURED GAS PRODUCTS LIKE ALUMINUM, THEY HAVE CHEAP ENERGY SOURCES.

PRODUCTS WHERE WE ARE GOING TO SEE SOME PRICE PRESSURES, AND CERTAINLY THAT HITS DIFFERENT MARKETS, DIFFERENT ECONOMIES, IN VARIED WAYS.

>> YOU KNOW, KAREN, YOUR ANALYSIS IS QUITE MEASURED, THERE.

AND WE WILL GET TO MORE OF THE IMPLICATIONS OF THAT, BUT MARINO, I WANT TO SAY TO YOU, THE QATARI GOVERNMENT SAYS THIS WAR HAS RESULTED IN WHAT THEY CALL A BREAKDOWN OF THE SECURITY SYSTEM IN THE ENTIRE GULF REGION.

YOU ARE IN DOHA, WHAT IS THE FEELING ON THE GROUND, THERE?

I TAKE YOUR POINT THAT IN THE LAST 48 HOURS, THINGS HAVE BEEN MORE QUIET, BUT ARE PEOPLE THERE QUESTIONING THE SECURITY ARCHITECTURE?

WILL IT HAVE A FUTURE?

AND ARE THEY ALSO QUESTIONING THE WISDOM OF THEIR GOVERNMENT AND ITS TIES TO THE UNITED STATES?

>> WELL, NOT YET, BUT CERTAINLY, WHEN THE DUST OF THIS DESTRUCTIVE WAR IS OVER, THERE IS GOING TO BE A LOT OF SOUL-SEARCHING, AND A LOT OF VERY SERIOUS QUESTIONS ASKED, A LOT OF SERIOUS QUESTIONS THAT REGIONAL LEADERS WILL BE ASKING HELD ACCOUNTABLE TO THEIR POPULATIONS.

AND EITHER, THEY WOULD DEEPEN THEIR SECURITY ALLIANCES WITH THE UNITED STATES, OR THEY WILL CONTINUE THE TREND THAT HAS HAPPENED OVER THE LAST DECADE OR SO, WHICH IS TO DIVERSIFY THEIR SECURITY PARTNERSHIPS WITH THE EUROPEAN UNION, WITH TURKEY, WITH --SAUDI ARABIA HAS A STRATEGIC PARTNERSHIP WITH PAKISTAN.

AND SO, WHAT WE ARE LIKELY TO SEE IS A GREATER DIVERSIFICATION OF THESE SECURITY PARTNERSHIPS, WITH VARIOUS ACTORS OTHER THAN THE UNITED STATES.

I THINK, ONE THING YOU ALSO MENTIONED IS REALLY IMPORTANT, WHICH IS KIND OF THE WAY THAT LIFE HAS BEEN.

I THINK WE NEED TO REMEMBER THAT COUNTRIES LIKE QATAR AND THE UNITED ARAB EMIRATES ARE AMONG THE SAFEST IN THE WORLD.

THERE IS TREMENDOUS TRANQUILITY AND SECURITY THAT ALL OF US HAVE BEEN FEELING FOR THE LAST HOWEVER MANY YEARS, FOR THE LAST SEVERAL DECADES, IN FACT.

AND THAT TRANQUILITY HAS BEEN SHATTERED.

NOW, THAT BREAKDOWN IN THE SENSE OF SECURITY, I THINK THAT IS FAR MORE IMPORTANT, AND SO, IT WILL INCREASE THE COST OF DOING BUSINESS FOR MANY OF THESE COUNTRIES.

THE LOCAL ECONOMIES, HERE IN THE PERSIAN GULF, RELY ON THE CREATIVE CLASSES THAT THEY ATTRACT FROM AROUND THE WORLD, AND THAT ATTRACTION IS GOING TO COST A LOT MORE NOW THAN IT DID BEFORE THE WAR BROKE OUT.

>> ESPECIALLY WHEN YOU ARE DEALING WITH THAT PROXIMITY, AGAIN, TO THIS ENERGY ARCHITECTURE THAT IRAN HAS NOW SUCCESSFULLY WEBINARS, IN A WAY.

KAREN, YOU HAVE ALREADY MAPPED OUT SOME OF IT, BUT COULD YOU ITSELF AND HOW STRATEGICALLY IMPORTANT HORMUZ IS?

IT IS A VAST ARRAY OF STRATEGICALLY PLACED PORTS AND PIPELINES, WHAT HAPPENS, THOUGH, IF IT REMAINS THROTTLED OR IN DANGER FOR MUCH LONGER?

AND I NOTE THAT YOU POINTED OUT, WHAT IS THE REAL PROBLEM HERE IS IF THE ACTUAL INFRASTRUCTURE IS DAMAGED.

>> THAT'S RIGHT.

SO, WE DON'T HAVE A PROBLEM OF PRODUCING OIL, BUT IT BECOMES A PROBLEM WHEN YOU GET SHUT IN, SO THE LONGER THAT OIL WELLS ARE NOT PRODUCING, THAT TAKES LONGER FOR THEM TO THEN BE REACTIVATED.

SO, THAT'S ONE ISSUE TO THINK ABOUT.

THE DURATION OF THIS CONFLICT INCREASES THE PRICE SENSITIVITY, AND THIS KIND OF LONGER-TERM IMPLICATIONS.

NOW, YOU KNOW, IT DEPENDS ON WHO IS THE BUYER, RIGHT?

WHO IS THE CUSTOMER?

AND MANY OF THE ENERGY SUPPLIES, WHETHER IT IS LNG, OR CRUDE, OR REFINED PRODUCT COMING OUT OF THE PERSIAN GULF ARE GOING EASTWARD, THEY ARE CUSTOMERS NOW, THAT THEY ARE FACING, REALLY, THE IMPACT OF THIS.

AND THE POORER ECONOMIES OF ASIA ARE ALREADY HAVING TO MAKE POLICY CHOICES, YOU KNOW, WORK FROM HOME POLICIES, CLOSING UNIVERSITIES, ENCOURAGING PEOPLE TO ONLY WORK FOUR DAYS PER WEEK.

GOVERNMENT EMPLOYEES, YOU KNOW, ASKING TO CONSERVE ENERGY.

SO, POORER ECONOMIES, WE ARE TALKING ABOUT PAKISTAN, BANGLADESH, EVEN IN EAST ASIA AND VIETNAM, THESE ARE THE KINDS OF ECONOMIES THAT ARE GOING INTO PLACE.

MORE WEALTHY ASIAN ECONOMIES, SOUTH KOREA, JAPAN, INDIA, HAVE BEEN ABLE TO INSTITUTE FUEL SUBSIDIES, SO THE GOVERNMENT IS ESSENTIALLY CARRYING SOME OF THE COST OF THE INCREASE IN ENERGY PRICES, AND THE EUROPEANS ARE GOING TO BE MORE AFFECTED ON NATURAL GAS.

AND THIS IS WHY THE --YOU KNOW, THE 20% OF GLOBAL LNG SUPPLIES THAT QATAR WAS SENDING OUT OF THE STRAIT OF HORMUZ THAT ARE NOW NOT GOING ANYWHERE AND WON'T BE GOING ANYWHERE FOR A LONG TIME -- MAYBE 3 TO 5 YEARS --IS GOING TO HIT EUROPE ESPECIALLY HARD.

>> YEAH, 3 TO 5 YEARS, THINK OF IT.

MARINO, WHAT IS YOUR THINKING RIGHT NOW OF THE IRANIAN REGIME, ITSELF?

STILL INTACT, BUT WHO IS IN CHARGE, DO YOU BELIEVE?

BECAUSE WE ARE HEARING FROM THE TRUMP ADMINISTRATION THAT IT IS APPARENTLY EYEING, PERHAPS, IN HAVING SOME TYPE OF A CONVERSATION WITH IRAN PARLIAMENTARY SPEAKER, HIS PUBLIC POSTURE SAYS NO TALKS AND THAT THE U.S.

POSTPONEMENT, HE SAYS, OF STRIKING ENERGY FACILITIES WAS, IN HIS WORDS, TO ESCAPE THE QUAGMIRE IN WHICH THE U.S.

AND ISRAEL ARE TRAPPED.

NOW, THIS IS WHAT AN ADMINISTRATION, THOUGH, TOLD "POLITICO" ON THIS.

"IT'S ALL ABOUT INSTALLING SOMEONE LIKE KELSEY RODRIGUEZ IN VENEZUELA THAT WE SAY WE ARE GOING TO KEEP YOU THERE, WE ARE GOING TO NOT TAKE YOU OUT, YOU ARE GOING TO WORK WITH US, YOU ARE GOING TO GIVE US A GOOD DEAL, A FIRST DEAL ON THE OIL."

WHAT SHOULD WE KNOW ABOUT HIM BE THIS ELUSIVE FIGURE THAT THE TRUMP ADMINISTRATION WANTS IN PLACE IN IRAN?

>> HE IS AN INCREDIBLY AMBITIOUS POLITICAL ACTOR IN THE IRANIAN POLITICS.

FORMER MAYOR OF TEHRAN, A PILOT, FORMER COMMANDER OF THE REVOLUTIONARY GUARDS, THE PERENNIAL PRESIDENTIAL CANDIDATE WHO HAS NOT HAD SUCCESS SO FAR AND CURRENTLY THE SPEAKER OF THE IRANIAN PARLIAMENT.

A MEMBER OF THE DEEP STATE, SOMEONE VERY FAMILIAR WITH POLICYMAKING AT THE HIGHEST LEVELS AND AN OPERATOR, BUT ALSO SOMEONE WHOSE HANDS ARE TAINTED WITH THE BLOOD OF CIVILIAN IRANIANS WHO HAVE BEEN INVOLVED IN MANY CRACKDOWNS GOING ALL THE WAY BACK TO THE LATE 1980s AND 1990s.

AND SO, HE IS A POLITICAL OPERATIVE, VERY AMBITIOUS, SIMILAR TO MOST OTHER WELL- KNOWN FIGURES WITHIN THE ISLAMIC REPUBLIC, TREMENDOUSLY UNPOPULAR AMONG THE BULK OF THE MIDDLE CLASSES, BUT ULTIMATELY, A VERY PRAGMATIC AND PRACTICAL GUIDE.

AND, I THINK, IMPORTANT TO SAY, HE IS SAID TO BE CURRENTLY IN CHARGE OF MILITARY STRATEGY AND MILITARY DECISIONS AND IN THAT SENSE, THAT IS VERY IMPORTANT.

A DIVISION OF LABOR HAS EMERGED IN IRAN WHEREBY THE PRESIDENT IS RUNNING THE DOMESTIC, POLITICAL AFFAIRS OF THE COUNTRY, AND THE SPEAKER OF THE PARLIAMENT IS RUNNING THE MILITARY OPERATIONS.

AND IF, INDEED, HE IS THE IRANIAN FIGURE WITH WHOM THE AMERICANS ARE GOING TO TALK, THERE IS A DEEP REALIZATION IN WASHINGTON THAT THAT IS THE POLITICAL OPERATIVE INSIDE THE COUNTRY WHO MAKES KEY MILITARY DECISIONS RIGHT NOW.

>> YEAH, AND AS YOU POINT OUT, NOT SOMEONE, THOUGH, THAT IRANIANS THEMSELVES WILL BE ABLE TO COUNT ON FOR ANY KIND OF CHANGE IN THEIR LIVES OR CERTAINLY IN THEIR RIGHTS.

KAREN, GIVEN THE FALLOUT --SO, LET'S SAY THERE IS A DEAL IN THE COMING WEEKS --THE FALLOUT, HERE, WILL BE PROFOUND.

NOT JUST FOR IRAN BUT ALSO FOR RUSSIA, GIVEN THE ENERGY SOURCES RIGHT NOW.

THE TRUMP ADMINISTRATION HAS LIFTED SANCTIONS ON BOTH RUSSIAN AND IRANIAN OIL, TREASURY SECRETARY SCOTT BESSENT CLAIMS THAT IT DOESN'T ENRICH EITHER REGIME BECAUSE THAT OIL WAS ALREADY PAID FOR AT SOURCE.

IT WAS STRANDED IN TANKERS, SO WE ARE JUST LETTING THAT OIL ON THE MARKET.

IS HE CORRECT ABOUT THAT?

AND DO YOU BELIEVE THAT IRAN AND RUSSIA WILL HAVE TO REMAIN UNSANCTIONED FOR A TIME, IN ORDER TO REALLY STABILIZE THE ENERGY MARKET?

>> WELL, THIS HAS BEEN ONE OF THE VERY CONFOUNDING SURPRISES OF THIS CONFLICT THAT THE U.S.

HAS RELAXED THE SANCTIONS ON RUSSIA AND IRAN.

NOW, THE ABILITY TO ACTUALLY GET CASH IN HAND FOR ALL 50 STATES IS MORE OF A DIFFICULT PROBLEM, MORE DIFFICULT FOR IRAN THAN IT IS FOR RUSSIA.

I WOULD SAY, RUSSIA IS CLEARLY BENEFITING, MOSTLY BECAUSE RUSSIA WILL LOOK LIKE MORE OF A STABLE, RELIABLE SUPPLIER OF ENERGY NEEDS TO CHINA AND THAT IS A LONGER-TERM PROSPECT.

SO, RUSSIA NOW HAS A PIPELINE, SIBERIA ONE, TO CHINA.

IT EXPORTS LNG AND OF COURSE CRUDE OIL TO CHINA, NOW CHINA CAN BUY MORE OF THAT CRUDE, WHICH HAS BEEN SANCTIONED.

A LOT OF IT WAS FLOATING, MEANING THAT TANKERS ARE SITTING OUT, WAITING TO GO TO REFINERIES IN CHINA.

THAT WILL BE EASIER FOR THEM TO OFFLOAD, NOW.

BUT, THERE ARE SOME PROSPECTS, EVEN THE RUSSIANS WANTED TO BUILD A SECOND PIPELINE FOR A VERY LONG TIME AND GET SORT OF A LONGER-TERM RELATIONSHIP WITH CHINA AS A CUSTOMER, AND THEY ARE LIKELY TO GET THAT.

CHINA IS ALREADY PRETTY WELL AND I AM SURE IT WILL, I'M SURE, REINFORCED THAT AFTER THIS CONFLICT, AS ANY COUNTRY WILL BE THINKING ABOUT ENERGY SECURITY GOING FORWARD.

>> YOU CERTAINLY OUTLINED THE LIKELY WINNERS AS THE CONFLICT CONTINUES.

KAREN YOUNG, MARINO, THANK YOU TO YOU, BOTH.

APPRECIATE IT.

>>> HAS BLOOD --HEZBOLLAH SAYS IT HAS LAUNCHED DOZENS OF STRIKES AGAINST MILITARY TARGETS AND COMMUNITIES IN NORTHERN ISRAEL, AND ISRAEL STEPS OF ITS OWN ATTACKS ACROSS THE BORDER WITH LEBANON.

DEFENSE MINISTER SAYS THEY ORDERED THE DESTRUCTION OF FIVE BRIDGES ACROSS THE RIVER, WHICH WILL CUT OFF SOUTHERN LEBANON FROM THE REST OF THE COUNTRY.

NOW, ISRAEL'S FAR RIGHT FINANCE MINISTER SAYS THE LATONYA ITSELF MUST BECOME ISRAEL'S NEW NORTHERN BORDER.

CORRESPONDENT NICK PAYTON WALSH REPORTS FROM SOUTHERN LEBANON ON HOW THIS AFFECTS THE CIVILIAN POPULATION THERE.

>> Reporter: SOMETHING FAMILIARLY AWFUL IS HAPPENING, HERE.

ISRAEL SENT LEAVE TO THE TOWN TWO WEEKS AGO, NOW LIFE IS GROUND OUT OF ITS STREETS.

THIS EXTRAORDINARY DEVASTATION JUST HELPS EXPLAIN HOW THE SELF IS BEING EMPTIED.

ULTIMATELY, A STRATEGIC PART OF THE ISRAELI CAMPAIGN, HERE.

AND THOSE BLASTS ARE DISTANT.

EVEN HIGHER UP, STILL NO CALM.

THEY DEAL WITH THE CONSTANT NOISE OF GETS AROUND THEM HERE, BUT ALSO JUST OVERNIGHT, INTENSIFICATION OF AIRSTRIKES AND BECAUSE THEY ARE UP ON THE HILL HERE, THEY FEEL AND SEE EVERYTHING.

AND OF COURSE, THE INJURED FROM IT COME INTO HERE, AS WELL.

>> EVERYTHING.

>> EVERYTHING?

>> YEAH, EVERYTHING.

I GUESS THERE'S JUST TOO MANY STRIKES.

>> Reporter: THERE ARE FEWER PEOPLE BELOW SO FEWER PATIENTS THAN AT THE START.

>> THEY HAVE BEEN INJURED, THREE OF THEM DIED AND THE REST LOST THEIR FAMILIES.

18 PEOPLE IN THE STRIKE, ALL CIVILIANS.

>> Reporter: THE BURNS UNIT TREATING A RESCUE WORKER WHO RAN HEADLONG INTO THE CARNAGE.

>> [ SPEAKING IN A NON-ENGLISH LANGUAGE ] >> Reporter: AND DOCTORS' FAMILIES HAVE MOVED IN, AS IT IS SAFER, HERE.

>> [ SPEAKING IN A NON-ENGLISH LANGUAGE ] >> Reporter: TO THE SOUTH, WHERE WE ALSO FILMED, WITH HEZBOLLAH'S POSITION, LIFE TWO IS BEING SQUEEZED OUT.

ISRAEL WARNED IT WOULD BLOW UP ALL THE BRIDGES TO THE SOUTH, SPARKING PANIC.

WHICH ONE WOULD THEY HIT FIRST?

THEY ARE SHOUTING, "WARNING," ABOUT THE JETS.

WHICH WE HAVE BEEN HEARING FOR THE LAST HALF-HOUR.

THIS ONE, PARTICULARLY, THOUGH -- THIS, THE FORCE USED.

>> [ SOUND OF GUNFIRE ] >> Reporter: AND THEY WOULD HIT IT TWICE AGAIN, LATER.

YET, MORE ISOLATED NOW IN HERE IS THE ENTIRE VILLAGE, HERE WE MET EARLIER AND FLED THEIR HOMES TO THE SCHOOL.

>> ABOUT 240.

>> Reporter: FIVE OF THE MEN DEAD, TWO GIRLS HERE WITHOUT FATHERS, WHO SLEEP WITH THEIR GRANDMOTHERS HERE, BUT ARE STILL GIRLS.

>> I WANT TO TELL YOU A SECRET.

>> Reporter: HE KEEPS PUSHING JAZMIN'S ARM AWAY, STILL.

>> [ SPEAKING IN A NON-ENGLISH LANGUAGE ] >> Reporter: 1 MILLION ARE FORCED FROM THEIR HOMES IN LEBANON AND INTO ANGER -- IMAGINATION WHERE THESE GIRLS HIDE FROM HARBOR.

>> [ SPEAKING IN A NON-ENGLISH LANGUAGE ] >> Reporter: MOHAMMED IS 16 AND WORLDLY.

WHAT DO YOU THINK OF TRUMP?

>> NOT GOOD.

>> Reporter: NOT GOOD?

>> BAD.

VERY BAD.

>> VERY, VERY NOT GOOD.

I HATE HIM.

HE IS SO BAD.

AND WE KNOW ABOUT THE EPSTEIN.

>> Reporter: YEAH.

THE EPSTEIN FILES?

>> Reporter: BUT, NO CALM HERE, EITHER.

SO, THEY SAY THAT, FOUR DAYS AGO, THEY GOT WORD WHAT MUST HAVE BEEN A FAKE WARNING TO THE TELEPHONE TO THE PEOPLE HERE TO TELL THEM TO GET OUT SO THEY RAN DOWN HERE AS FAST AS THEY COULD AND HID DOWN ON THE BEACH FOR FIVE HOURS UNTIL THE THREAT HAD PASSED.

THE CITY'S OLD RUINS SIT SILENT AND POWERLESS AS IT KEEPS GETTING NEW ONES.

>> OUR THANKS TO NICK PAYTON WALSH THERE REPORTING FROM SOUTHERN LEBANON.

>>> NOW, CUBA IS FACING SEVERE PRESSURE, PERHAPS THE GREATEST AT ANY TIME SINCE THE CUBAN MISSILE CRISIS.

AS AN AMERICAN BLOCKADE PREVENTS ANY OIL FROM ENTERING THE COUNTRY.

CUBANS ENDURED NATIONWIDE BLACKOUTS, MANY TIMES, NOW, AS THE POWER GRID COMPLETELY COLLAPSES AND DONALD TRUMP SEES >> I DO BELIEVE I WILL BE --I WILL HAVE THE HONOR OF TAKING CUBA.

I KNOW THAT'S A BIG HONOR.

>> Reporter: TAKING CUBA?

>> TAKING CUBA IN SOME FORM, YEAH.

TAKING CUBA.

I MEAN, WHETHER I FREE IT, TAKE IT, I THINK I CAN DO WHATEVER I WANT WITH IT.

>> SO, WILL PRESIDENT TRUMP HAVE THE HONOR OF "TAKING CUBA," OR CAN HAVANA WITHSTAND THIS CRISIS, AS IT HAS WITHSTOOD SO MANY BEFORE?

FOR MORE ON THIS, WE ARE JOINED BY MARK, HE SERVED AS CANADA'S AMBASSADOR TO CUBA IN THE 1990s, WHEN HE FORGED A CLOSE WORKING RELATIONSHIP WITH FIDEL CASTRO.

MARK, WELCOME TO THE PROGRAM.

IT IS GOOD TO SEE YOU AGAIN.

AND I WANT TO POINT OUT TO OUR VIEWERS THAT YOU HAVE BEEN BLUNT ABOUT THE PRICE BEING PAID BY CUBANS IN HUMANITARIAN TERMS.

IN FACT, YOU CALL THE OIL BLOCKADE AND THE U.S.

SANCTIONS HERE, "THE MODERN EQUIVALENT OF A MEDIEVAL SIEGE."

JUST TO KIND OF PUT THIS INTO THE CONDITIONS OF ORDINARY CUBANS TODAY?

AND THIS IS UNDERSTANDING WHAT THEY HAVE STRUGGLED WITH ALREADY FOR SO MANY DECADES.

>> WELL, ABSOLUTELY, DELIGHTED TO BE HERE.

IT IS TOO BAD WE ARE TALKING ABOUT CUBA IN SUCH, YOU KNOW, SAD TIMES.

CUBA HAS BEEN STRUGGLING WITH AN ECONOMY THAT HAS NOT WORKED WELL AND PROPERLY FOR SOME TIME.

THE SITUATION AFTER COVID-19, THE GLOBAL PANDEMIC, WORSENED TREMENDOUSLY, PERHAPS IF THE CUBAN GOVERNMENT COULD HAVE HAD AN OPPORTUNITY TO MAKE SOME REFORMS TO ITS ECONOMIC SYSTEM, BUT THE CURRENT SITUATION IS EXPONENTIALLY WORSE.

I CAN ARGUE UNTIL THE COWS COME HOME ABOUT, YOU KNOW, WHETHER THE U.S.

EMBARGO IS AT FAULT OR THE CUBAN GOVERNMENT'S POLICY IS AT FAULT.

THE CURRENT SITUATION IS, CALL A SIEGE.

CUBA IS UNDER SIEGE.

THE RESULT CAN ONLY BE TOTAL SURRENDER OF THE CUBAN STATE AND THE SITUATION FOR EVERYDAY CUBANS IS INFINITELY WORSE, WITH THE FOOD SHORTAGES, AND MEDICINE SHORTAGES, AND HOSPITALS, AND THE ELECTRICITY, AND THE POWER, BLOCKING OFF OIL SUPPLIES AND FUEL SUPPLIES TO AN ECONOMY, THAT ARE SO ESSENTIAL TO HOW THE COUNTRY EVEN WORKS.

JUST MOVING THINGS AROUND, GOODS AND SERVICES TO PEOPLE, IT IS A COUNTRY UNDER SIEGE WITH NO CLEAR, EVIDENT PLAN OF WHAT COMES NEXT.

>> AND GIVEN WHAT COMES NEXT, HERE, I DON'T HAVE TO REMIND YOU THAT WE ARE GETTING CONTRADICTORY MESSAGES FROM CUBA, ITSELF.

THE FOREIGN MINISTER IS SAYING THEY ARE OPEN TO NEGOTIATIONS WITH THE TRUMP ADMINISTRATION, PRESIDENT TRUMP SAYS THEY ARE TALKING.

BUT, THEN, YOU HAVE THIS FROM CUBA'S PRESIDENT, MIGUEL DIAZ CANAL.

>> Translator: FIRST OF ALL, WE RECOGNIZE THAT THE COULD BE AN AGGRESSION AGAINST CUBA, AND WE HAVE UNLEASHED A PREPARATION PLAN TO RAISE OUR PEOPLE'S READINESS FOR DEFENSE IN THE INTEREST OF THE WAR, OF ALL THE PEOPLE.

TO YOU, WHO WILL ARE OUR SISTERS AND BROTHERS, WE SPEAK WITH COMPLETE HONESTY AND TRANSPARENCY.

I CAN RESPONSIBLY AFFIRM THAT THE LEADERSHIP OF THE CUBAN REVOLUTION IS UNITED.

>> SO, HOW DO YOU ASSESS THE STRENGTH OF THE REGIME RIGHT NOW AND WHETHER IT CAN MOUNT A RESISTANCE OR EVEN WANTS TO?

IF IT IS ACTUALLY, YOU KNOW, LOOKING FORWARD TO SOME U.S.

INTERVENTION, HERE, IN SOME WAY, IF IT CAN MAKE A DEAL WITH WASHINGTON?

>> WELL, I THINK THE REALITY ON THE ISLAND IS, THAT THE CUBAN PEOPLE ARE ABSOLUTELY EXHAUSTED, AND TIRED, AND FED UP, AND WORN OUT, AND FRUSTRATED, AND DISHEARTENED, WITHOUT QUESTION.

I DON'T BELIEVE THAT THE CUBAN STATE HAS THE BROADER SUPPORT THAT IT MIGHT HAVE HAD IN THE PAST.

HAVING SAID THAT, THERE IS A SECRET WEAPON, IF YOU WILL, THAT THE CUBANS DO HAVE AND THAT IS A PROFOUND SENSE OF NATIONAL IDENTITY, AND PATRIOTISM.

AND THE KINDS OF LANGUAGE THAT IS BEING USED RIGHT NOW, INCLUDING FROM THE PRESIDENT OF THE UNITED STATES HIMSELF ABOUT, YOU KNOW, "TAKING CUBA," AND HE CAN DO ANYTHING HE WANTS WITH IT, REALLY STRIKES AT THE HEART OF CUBAN NATIONALISM, WHICH MIGHT BE SET ASIDE FOR THE TIME BEING IN THE FACE OF ECONOMIC TROUBLE, BUT IT SITS THERE.

IT LURKS IN THE BACKGROUND.

AND HISTORY HANGS OVER CUBA LIKE KIND OF A THICK FOG.

THE IDEA THAT THE COULD BE SOME KIND OF DEAL WITH THE UNITED STATES, I THINK, WOULD BE BROADLY SUPPORTED BY THE CUBAN PEOPLE.

AS WE SAW DURING THE OBAMA RESET, HUGELY RE-POPULAR.

BUT, THE IDEA THAT WE ARE RETURNING TO --OR, THE CUBANS WOULD BE FORCED TO RETURN TO THE 1940s ARE '50s AS AN EFFECTIVE ECONOMIC COLONY OF THE UNITED STATES TO BE PLAYED WITH, LIKE A CAT PLAYS WITH A MOUSE, THIS ACTUALLY UNIFIES SEGMENTS OF THE CUBAN POPULATION THAT MIGHT NOT HAVE BEEN SUPPORTIVE OF THE GOVERNMENT.

SO, I THINK, IF I WAS GIVING ANY ADVICE, I THINK THE GOVERNMENT OF THE UNITED STATES --WHICH, I AM NOT --I THINK SOME LESSONS NEED TO BE LEARNED ABOUT THE HISTORICAL RELATIONSHIPS, AND THE LANGUAGE NEEDS TO BE MORE RESPECTFUL.

THIS WOULD GO A LONG WAY.

I THINK THERE IS ROOM, IN FACT, FOR THEM TO REACH SOME KIND OF AN AGREEMENT ON A WAY FORWARD.

THIS WOULD NOT BE SATISFACTORY TO THE HARDER LINE ELEMENTS OF THE CUBAN-AMERICAN COMMUNITY, OF COURSE, WHO BELIEVE THAT NOW IS THE TIME TO TOPPLE AND FINALLY BRING DOWN THE GOVERNMENT.

BUT, WITHOUT A PLAN FOR THE DAY AFTER, WHAT WITH THE COST OF THAT BE TO THE UNITED STATES?

SO, I THINK BOTH PARTIES SHOULD STEP BACK A LITTLE BIT, GO TO THE TABLE AS ADULTS, AND LOOK AT A WAY FORWARD.

CUBA HAS CHANGED A LOT.

IF I LEARNED ONE THING IN DEALING WITH THE CUBANS FOR DECADES, UP CLOSE AND PERSONAL, THEY ARE NOT COMMUNIST IDEOLOGUES.

IN FACT, THEY ARE PRAGMATISTS.

THEY ARE KIND OF HIGH PRAGMATISTS.

CUBA IS A NUANCED AND COMPLEX PLACE, SO I WOULD SET ASIDE THE KIND OF WORN OUT COLD WAR NARRATIVE AND LOOK FOR WAYS THAT THE TWO COUNTRIES CAN ACTUALLY WORK TOGETHER, AND BUILD --AND RESET THE RELATIONSHIP.

I BELIEVE THAT IS WHAT THE CUBAN PEOPLE WOULD LIKE TO SEE.

>> AND YET, SO FAR, JUST GOING BY PRESIDENT TRUMP'S RHETORIC, THAT DOESN'T SEEM TO BE THE ROAD THEY ARE GOING DOWN.

MARK, YOU TALKED A LOT ABOUT NUANCE.

YOU TALKED ABOUT THE NUANCE, HERE, AND YOUR RELATIONSHIP.

YOU DON'T DIRECTLY, FOR FOUR YEARS IN THE '90s WITH FIDEL CASTRO HIMSELF, YOU SPENT DOZENS OF HOURS WITH HIM TALKING WITH HIM IN YOUR HOME, IN HAVANA, AS CANADA'S AMBASSADOR.

HOW DOES THAT TIME IN CUBA AND YOUR RELATIONSHIP WITH FIDEL INFORM HOW YOU SEE THE COUNTRY TODAY AND WHAT YOU BELIEVE IS POSSIBLE, KNOWING THAT THE CASTRO NAME AND THE CASTRO FAMILY STILL WIELDS INFLUENCE, THERE?

>> FIDEL CASTRO WAS KIND OF A MERCURIAL LEADER.

VERY POLARIZING, YOU KNOW, INTERNATIONALLY, OBVIOUSLY.

BUT, KIND OF A HISTORIC FIGURE, WHICH CUBA DOES NOT HAVE ANY MORE.

HIS BROTHER, RAUL, WAS ALWAYS SHUNNED, THE SPOTLIGHT WAS A VERY RELUCTANT PRESIDENT IN MY OPINION.

HE IS ACTUALLY KIND OF A SHY PERSON, AS AN INDIVIDUAL.

WHAT THEY'VE GOT IN CUBA RIGHT NOW IS KIND OF A MANAGERIAL CLASS LEADERSHIP, BUT THEY ARE HIGHLY COHESIVE AND I THINK THIS IS SOMETHING THAT, WHEN THEY ARE TALKING ABOUT COHESION, I BELIEVE THEY ARE --THERE IS NO DELCY RODRIGUEZ LURKING IN THE BACKGROUND THAT YOU CAN PRY LOOSE, THE CUBAN POLITICAL LEADERSHIP.

I THINK THEY ARE OPEN-MINDED TWO WAYS FORWARD, BUT THEY, THEMSELVES, HAVE SAID THAT, YOU KNOW, YOU HAVE TO RESPECT CUBAN SOVEREIGNTY AND CUBANS WILL SORT IT OUT FOR THEMSELVES.

AND I THINK THIS IS WHAT THEY BELIEVE.

THEY BELIEVE THEY ARE AT WAR, THEY BELIEVE THEY ARE UNDER SIEGE FROM A VERY AGGRESSIVE NEIGHBOR WHOSE OBJECTIVE IS TO GET RID OF THEM, THROW THEM ALL INTO THE SEA, SO THEY TEND TO BE HIGHLY UNIFIED, AND BY AND LARGE, PREFECTURAL LEADERSHIP GROUP.

IF THERE WAS AN APPETITE ANYWHERE IN THE U.S.

ADMINISTRATION TO HAVE SERIOUS TALKS AND CONVERSATIONS WITH THEM ABOUT THE FUTURE, I THINK THEY WOULD BE AT THE TABLE, I REALLY DO.

I KNOW THEM QUITE WELL.

>> AND I KNOW YOU DO AND THERE ARE REPORTS, AS YOU KNOW, THAT THERE IS THIS LINE OF COMMUNICATION BETWEEN FIDEL CASTRO'S GRANDSON AND THE TRUMP ADMINISTRATION, PERHAPS EVEN WITH THE SECRETARY OF STATE RUBIO WHO HAS, OBVIOUSLY, CUBAN HERITAGE.

HOW MUCH POWER AND INFLUENCE CAN THEY ACTUALLY HAVE IN TERMS OF ACTUALLY BRINGING THAT TO BEAR WITH MARCO RUBIO, HIMSELF, GIVEN THAT, YOU KNOW, THE TRUMP ADMINISTRATION MAY DETERMINE THAT THAT WOULD BE BETRAYING A KEY CONSTITUENCY IN THE UNITED STATES, SOMETHING THAT YOU HAVE WRITTEN ABOUT, THAT THERE IS THIS VERY POWERFUL POLITICAL LOBBY IN THE UNITED STATES THAT WANTS SOMETHING COMPLETELY DIFFERENT.

>> YEAH.

AND THE APPROACH FROM THE UNITED STATES TO CUBA IS -- HAS A NUMBER OF INHERENT CONTRIBUTIONS IN IT, BUILT UP OVER DECADES, AND, I MEAN, I MIGHT AS WELL SPEAK BLUNTLY, HERE.

ONE OF THE REALITIES OF ALL OF THIS, IS THAT THE INTERESTS OF CERTAIN HARDLINES ELEMENTS IN THE CUBAN-AMERICAN COMMUNITY WHO HAVE ELECTORALLY SUPPORTED THE REPUBLICAN PARTY FOR MANY, MANY YEARS, AND SUPPORT THE TRUMP ADMINISTRATION, AND HAVE SUPPORTED SECRETARY RUBIO.

IT IS NOT IN --THE INTERESTS OF THOSE CUBAN-AMERICANS ARE NOT NECESSARILY THE INTEREST OF THE UNITED STATES.

AND YOU HAVE SEEN, IN HISTORY, WHERE U.S.

GOVERNMENTS HAVE REACHED ARRANGEMENTS OF CONVENIENCE WITH THE CURRENT HARD-LINE CUBAN-AMERICAN COMMUNITY IN MIAMI, FOR LACK OF UNTIL SUCH TIME IT IS OF INTEREST TO THE COUNTRY, THOSE RELATIONSHIPS BECOME INCONVENIENT.

WE SAW THE CUBAN-AMERICAN COMMUNITY, FOR A GENERATION, BELIEVE IT WAS BETRAYED BY PRESIDENT KENNEDY AFTER THE BAY OF PIGS.

IT IS POSSIBLE THAT THE NEEDS OF THE --CUBAN-AMERICAN COMMUNITY OVER TIME, WILL WITH THE UNITED STATES AS IT SEEKS STABILITY IN THE AREA, WANTS TO MANAGE MIGRATION OF CUBANS SO IT DOESN'T HAVE TO BE DEPORTING, YOU KNOW, TENS OF THOUSANDS OF CUBANS.

I BELIEVE THE PRESIDENT HAS ALSO SAID, QUITE EXPLICITLY, SEVERAL TIMES, HE WOULD LOVE TO SEE A PROSPEROUS CUBA SO THAT CUBANS CAN GO BACK TO IT.

AND I THINK THAT IS ONE OF THE UNDERLYING DRIVING FACTORS, AS WELL, WHICH IN MAY NOT BE SHARED IN THE CUBAN-AMERICAN COMMUNITY.

AMERICAN BUSINESSES BY AND LARGE IS QUITE DISTRESSED WITH ALL THE RELIABILITY OF THE U.S.

EMBARGO.

SO, YOU CAN HAVE AN IDEA THAT AMERICAN COMPANIES WILL GO BACK TO CUBA.

I HAVE WORKED WITH A NUMBER OF THEM IN MY CONSULTING BUSINESS, TO GO BACK TO CUBA, AND THEY MAY NOT GO BECAUSE IT IS ON INVESTABLE AND THEY DON'T TRUST THEIR OWN GOVERNMENTS EMBARGO ENFORCEMENT, SO THERE ARE A LOT OF CONTRADICTIONS HERE TO MANAGE.

>> MARK ANTWON, WE WILL HAVE TO LEAVE IT THERE, BUT OBVIOUSLY, WE CONTINUE TO WATCH THE SITUATION IN CUBA.

APPRECIATE IT.

>> YOU ARE WELCOME.

YOU TAKE CARE.

>>> SO, AS THE WORLD WATCHES THE TWISTS AND TURNS OF THE WAR WITH IRAN, THE GLOBAL MARKETS ARE MIRRORING THAT CHAOS, THE OIL MARKET PLUMMETED IN THE STOCK MARKET SOARED ON MONDAY AFTER TRUMP'S ANNOUNCEMENT OF POSITIVE TALKS WITH IRAN.

IRAN'S DENIAL OF ANY COMMUNICATION CAUSED THE PRICE OF OIL TO CREEP UP AGAIN.

FEARS ARE MOUNTING THAT THIS ECONOMIC VOLATILITY COULD CREATE MAJOR, LONG-TERM DAMAGE.

>>> FORMER TOP ECONOMIC ADVISER UNDER PRESIDENT OBAMA, JASON FURMAN, ARGUES THAT MAY NOT BE ALL THAT BAD.

HE TELLS WALTER ISAACSON THAT WHILE THE WAR COULD SPARK SHORT- TERM PAINS, THE FUTURE IMPACT WILL BE MUCH LESS DRAMATIC, AND HE EXPLAINS HOW THE U.S.

ECONOMY HAS FARED, SO FAR, UNDER PRESIDENT TRUMP.

>> THANK YOU, PAULA.

JASON FURMAN, WELCOME BACK TO THE SHOW.

>> IT'S GREAT TO BE BACK WITH YOU.

>> SO, YOU'VE GOT AN OP-ED PIECE IN "THE NEW YORK TIMES," THAT SAYS, "IF YOU HATE TRUMP'S ECONOMY, I HAVE NEWS FOR YOU."

WHAT IS THE NEWS FOR US?

>> THE NEWS IS THAT THE ECONOMY OVER THE LAST YEAR WAS AN AWFUL LOT LIKE THE ECONOMY IN 2024.

NOW, IF YOU'RE DONALD TRUMP, THAT IS DISAPPOINTING, BECAUSE YOU THINK YOU TOOK SOMETHING THAT WAS A HORRIFIC WRECK AND TURNED IT AROUND, BUT IF YOU ARE A DEMOCRAT AND THOUGHT MAYBE DONALD TRUMP WAS GOING TO TAKE SOMETHING PERFECTLY GOOD AND WRECK IT, MAYBE THAT IS A LITTLE DISAPPOINTING TO YOU, AS WELL.

>> WELL, THAT IS KIND OF ODD, WE HAD THESE TARIFFS, EVERYBODY SAID TARIFFS ARE GOING TO CAUSE MASSIVE INFLATION, THEY GO UP, GO DOWN, WHATEVER, THAT DIDN'T REALLY CAUSE MUCH OF AN ISSUE?

>> I WOULD SEPARATE TWO SEPARATE THINGS.

ONE IS, HOW DID THE ECONOMY DO IN 2025 AND IN THE LAST COUPLE MONTHS?

THAT IS A FUNCTION OF LOTS AND LOTS OF THINGS.

WHAT OUR TECHNOLOGY IS LIKE, WHAT OUR PEOPLE ARE LIKE, THE DECISIONS OF OUR BUSINESSES.

AND THEN, TO SOME DEGREE -- BUT, PROBABLY NOT THE BIGGEST FACTOR --POLICY THE PRESIDENT HAS.

AND WHEN YOU TAKE ALL OF THAT TOGETHER, THE YEAR AS A WHOLE WAS NOT SUPER DIFFERENT FROM THE YEAR BEFORE.

NOW, I DO THINK 2025 WOULD HAVE BEEN EVEN BETTER, BUT FOR ALL OF THOSE TARIFFS, I PRESIDENT TRUMP HURT THINGS, MAYBE JUST NOT AS MUCH AND AS DRAMATICALLY, RELATIVE TO ALL THE OTHER HUGE FORCES THAT AFFECT THE ECONOMY.

>> SO, WHAT ARE THOSE HUGE FORCES?

>> THE BIGGEST ONE IN THE LAST YEAR HAS BEEN THE A.I.

BOOM.

A LOT OF IT IS SHOWING UP ON THE DEMAND SIDE OF ECONOMY, WHERE WE ARE BUILDING MORE DATA CENTERS AND MAKING INVESTMENTS TO MAKE A.I.

I THINK WE HAVE SEEN SOME TENTATIVE DATA SHOWING THAT MAYBE IT IS ACTUALLY STARTING TO SHOW UP IN PRODUCTIVITY, ENABLING PEOPLE TO DO MORE WITH EACH HOUR OF WORK.

>> AND WE ARE INCREASING PRODUCTIVITY BECAUSE OF IT, RIGHT?

>> I HAVE JUST --I HAVE BEEN SKEPTICAL THAT IT WAS SHOWING UP IN PRODUCTIVITY, BECAUSE BUSINESSES ARE SLOW TO ADAPT AND FIGURE OUT HOW TO USE IT.

IN FACT, IN THE SHORT RUN, I SOMETIMES FIND MYSELF SPENDING HOURS TO FIGURE OUT THE LATEST AND BEST WAYS TO USE THE LATEST TECHNOLOGY, IN SOME SENSE, NOT GETTING ANYTHING DONE IN THOSE HOURS OTHER THAN AN INVESTMENT, HOPEFULLY, IN MY FUTURE PRODUCTIVITY.

WE HAVE SEEN THAT IN A LOT OF BUSINESSES, BUT THE LATEST DATA SUGGESTS THAT BUSINESSES REALLY ARE STARTING TO FIGURE IT OUT, IT IS STARTING TO SHOW UP IN THE ECONOMY AS A POSITIVE.

>> WHAT IS HAPPENING WITH YOUNG WORKERS AND GENERATION Z, THEY SEEM TO BE THE ONES THAT ARE GETTING HIT AND THEY ARE THE ONES VERY, VERY UPSET ABOUT THE ECONOMY.

I THINK "THE NEW YORK TIMES" -- WHICH YOU WORK WITH --THEY ASKED ABOUT THE LABOR MARKET TO A FOCUS GROUP OF GEN Z PEOPLE AND THEY SAID IT WAS "A SCAM," "UNFAIR," "HORRIBLE."

WHAT ARE SOME OF THE ECONOMIC CHANGES THAT ARE AFFECTING PEOPLE WHO ARE, LIKE, IN THEIR EARLY 20s?

>> SO, WE HAVE SEEN THE SLOWDOWN OF HIRING OF YOUNG PEOPLE.

A.I.

IS NOT THE BIGGEST FACTOR IN THAT.

SOME COMPANIES BLAME IT ON A.I., BUT IT ISN'T REALLY A.I., THEY JUST HAVE SOME OTHER REASON WHY THEY WANT TO CUT BACK ON HIRING.

SOME OF IT HAS BEEN THE FED, IN AN EFFORT TO SLOW THE ECONOMY, KEPT INTEREST RATES HIGH FOR A LONG TIME.

THAT WAS THE RIGHT CALL, GIVEN HOW HIGH INFLATION WAS, BUT IT HAS A DOWNSIDE.

AND THAT DOWNSIDE SHOWS UP IN THE LABOR MARKET AND IT SHOWS UP IN THE LABOR MARKET OFTEN FIRST, FOR YOUNGER WORKERS.

NOW, ONE REASON WHY I DON'T THINK IT IS A.I., IS IF YOU LOOK AT THE PATTERN OF THAT JOB LOSS, IT'S NOT JUST, YOU KNOW, COLLEGE EDUCATED WORKERS.

YOU SEE IT ACROSS THE EDUCATIONAL SPECTRUM.

IN FACT, A HIGHER LEVEL OF EDUCATION HISTORICALLY HAS BEEN --AND STILL IS --SOME OF THE BEST INSURANCE YOU CAN HAD AGAINST JOB LOSS.

>> WE HAVE HAD THE HIGHEST TARIFFS NOW I THINK SINCE THE 1940s, IS THAT RIGHT?

>> YES, SINCE THE 1940s.

>> SO, WHY HASN'T THAT TICKED UP INFLATION?

>> IT HAS ADDED TO INFLATION.

INFLATION RATE WOULD PROBABLY AT THE FED'S TARGET OF 2.0%, BUT FOR THE TARIFFS, BECAUSE OF THE TARIFFS, THEY ARE ADDING ABOUT A HALF POINT, MAYBE A LITTLE MORE, TO INFLATION.

SO, WHEN I SAY, INFLATION HAS BEEN ROUGHLY UNCHANGED OVER THE LAST COUPLE OF YEARS, IN SOME SENSE, IT WOULD HAVE FALLEN, BUT THE TARIFFS PREVENTED IT FROM FALLING.

AND THAT IS ONE OF THE THINGS THAT HAS COMPLICATED THE FED'S JOB.

IT IS ONE OF THE REASONS IT HASN'T CUT INTEREST RATES AS MUCH AS PEOPLE WOULD HAVE LIKED FOR THEM TO CUT RATES.

>> WHAT DO YOU THINK THE FED SHOULD BE DOING, NOW?

>> THEY ARE GOING TO BE VERY NERVOUS ABOUT THE INFLATION RATINGS OVER THE NEXT COUPLE OF MONTHS.

THEY ARE REALLY GOING TO SPIKE, AS GASOLINE PRICES RISE AS A RESULT OF THE IRAN CONFLICT.

I THINK WE SHOULD LOOK THROUGH THAT AND IGNORE IT.

THERE IS NOTHING THE FED CAN DO TO SETTLE THE AFFAIRS IN THE MIDDLE EAST.

THAT IS NOT AN ECONOMIC PROBLEM, THAT IS A NATIONAL SECURITY PROBLEM.

THEY SHOULD FOCUS ON THE UNDERLYING INFLATION RATE AND PROBABLY BE WILLING TO CONSIDER CUTTING RATES, IF IT LOOKS LIKE THE ECONOMY NEEDS IT, IF IT LOOKS LIKE THE LABOR MARKET IS WEAKENING.

>> BUT, LET'S TALK MORE ABOUT THOSE EFFECTS OF THE IRAN WAR.

SORT OF A LOT OF VOLATILITY, THESE DAYS.

BUT, IN SOME PLACES, YOU CAN SEE THE PRICE OF GASOLINE AT THE PUMP PUSHING CLOSER TO FIVE DOLLARS FOR PREMIUM AND CERTAINLY FOR DIESEL.

DOESN'T THAT FILTER THROUGHOUT THE ENTIRE ECONOMY AND CAUSE INFLATION?

>> OH, ABSOLUTELY, WE WILL SEE EXTRA INFLATION, WE WILL SEE DIFFICULTIES FOR CONSUMERS.

YOU KNOW, THE IMPACT ON THE ECONOMY AS A WHOLE IS MORE MUTED BECAUSE WE ALSO ARE NET WEREN'T, FOR EXAMPLE, IN 19 -- 1979 WHEN THE IRANIAN REVOLUTION SENT OIL PRICES SPIKING.

OUR INDUSTRIES DON'T USE NEARLY AS MUCH OIL AS THEY USED DECADES AGO.

SO, FOR AGGREGATE GDP, IT IS GOING TO BE A SMALL HIT, BUT FOR CONSUMERS, IT WILL BE A MUCH LARGER HIT.

>> THE PRESIDENT YOU WORKED FOR, PRESIDENT BARACK OBAMA, ONCE SAID THE STRONGEST CORRELATION TO HIS POPULARITY RATINGS WAS THE CORRELATION BETWEEN THEM AND THE GAS PRICE AT THE PUMP.

TO WHAT EXTENT ARE WE GOING TO SEE SOME POLITICAL FALLOUT, HERE?

>> I THINK WE PROBABLY WILL.

WHEN GAS PRICES WENT UP, WE WOULD GO INTO PANIC MODE IN THE WHITE HOUSE.

WE WOULD BE LOOKING AT EVERY SINGLE ECONOMIC INDICATOR TO PREDICT WHAT WAS GOING TO BE HAPPENING, THINK ABOUT EVERY SINGLE POLICY TOOL TO UNDERSTAND WHAT WE COULD DO.

YOU SEE THIS ADMINISTRATION DOING THAT WITH BASICALLY ALLOWING RUSSIA TO EXPORT ITS OIL, ALLOWING IRAN TO EXPORT ITS OIL, COORDINATING A GLOBAL RELEASE.

ALL OF THAT, THOUGH, IS REALLY SMALL COMPARED TO THE MORE THAN 10 MILLION BARRELS PER DAY, ABOUT 1/10 OF GLOBAL OIL PRODUCTION, THAT IS NOW OFF- LINE BECAUSE OF THE CLOSURE OF THE STRAIT OF HORMUZ.

AS LONG AS THAT IS CLOSE, EVERYTHING ELSE IS JUST DANCING AROUND THE EDGES TO MITIGATE JUST A SMALL FRACTION OF THE DAMAGE THAT THAT IS DOING.

>> WELL, ONE OF THE THINGS I LEARNED IN ECONOMICS IS THAT THE ECONOMY AND ESPECIALLY THE MARKETS KIND OF LIKE CERTAINTY.

AND, BOY, ONE OF THE THINGS THAT HAS HAPPENED IN THE PAST YEAR HAS BEEN AMAZING VOLATILITY.

YOU KNOW, TARIFFS GO WAY UP, THEY GO DOWN, THEY GO BACK, THEY GO FORTH.

LIKEWISE, OIL PRICES, MAYBE THEY WILL STABILIZE FOR, YOU KNOW, WEST TEXAS, MAYBE IT WILL BE AROUND $80 PER BARREL BUT IT HAD GONE UP TO $100, DOWN TO $60, SO HOW DOES THAT VOLATILITY AFFECT THE ECONOMY?

>> LOOK, THERE'S TWO SEPARATE THINGS, HERE.

HOW DOES IT AFFECT THE STOCK QUITE A LOT.

WE SAW A LOT OF DRAMA IN APRIL OF LAST YEAR AROUND LIBERATION DAY, AND WE SAW DRAMA IN THE LAST COUPLE WEEKS AROUND IRAN.

HOW DOES IT AFFECT THE ECONOMY?

SOMEWHAT, BUT NOT QUITE AS MUCH AS THE DRAMAS IN THE FINANCIAL MARKET HEADLINES.

BECAUSE IT TURNS OUT, THERE IS JUST AN AWFUL LOT THAT MATTERS IN THE ECONOMY.

SOME PEOPLE ARE MAKING DECISIONS BASED ON THIS, BUT AN AWFUL LOT OF BUSINESSES ARE MAKING DECISIONS ENTIRELY UNRELATED TO THESE OIL PRICE GENERATIONS.

>> YOU SAY THAT THE PRESIDENT CAN'T DO MUCH TO CHANGE THE ECONOMY, IT HAS BEEN PRETTY MUCH THE SAME WHETHER IT WAS JOE BIDEN OR DONALD TRUMP, BUT DO THE THOUGHT EXPERIMENT FOR ME, IF DONALD TRUMP HAD NOT IMPOSED TARIFFS OFF AND ON, AND HIGH TARIFFS AND NOT DONE THIS WAR WITH IRAN, WOULD THE ECONOMY BE BETTER?

AND IF SO, HOW MUCH SO?

>> YEAH, I THINK IT WOULD BE BETTER.

THE TARIFFS HAVE PROBABLY ADDED HALF A POINT TO THE INFLATION RATE, THE WAR IS GOING TO ADD AT LEAST ANOTHER HALF POINT, PROBABLY MORE THAN A PERCENTAGE POINT, SO INFLATION WOULD BE LOWER IF DONALD TRUMP HADN'T DONE THESE TWO THINGS.

ECONOMIC GROWTH WOULD BE HIGHER.

I AM NOT QUITE SURE HOW MUCH HIGHER, THAT IS PROBABLY MORE LIKE A FEW TENTHS RATHER THAN A PERCENTAGE POINT OR TWO.

BUT, YOU WANT TO SEPARATE, YOU KNOW, TWO THINGS IN HER MIND, ONE IS PRESIDENTS DO MATTER AND EVERY 10th MATTERS AND WE SHOULD FIGHT FOR EVERY 10th ON GROWTH AND EVERY 10th REDUCTION ON INFLATION, BUT THEY DON'T MATTER QUITE AS MUCH AND AS DRAMATICALLY AS THE WAY WE SOMETIMES TALK ABOUT THEM, AND BOTH OF THOSE STATEMENTS ARE TRUE.

>> ONE STATISTIC THAT ALWAYS SEEMS IMPORTANT TO ME IS THE OVERALL PURCHASING POWER OF WAGES.

EXPLAIN WHAT THAT IS, AND HOW THAT HAS BEEN AFFECTED, RECENTLY?

>> YEAH, SO, ECONOMISTS LIKE TO LOOK AT, ON AVERAGE, HOW FAST DID WAGES GROW?

AND COMPARE THAT TO, HOW FAST DID PRICES GROW?

OVER THE LAST YEAR, WAGES GREW 1.4 PERCENTAGE POINTS FASTER THAN PRICES GROUP.

GOOD NEWS FOR WORKERS, IT'S ACTUALLY TOWARD THE UPPER END OF WHAT WE HAVE SEEN OVER THE LAST DECADE.

BUT, YOU KNOW, IT'S STILL A LITTLE BIT DISAPPOINTING IN THE GRAND SCHEME OF WHAT WE HAVE SEEN OVER TIME.

I THINK WE WOULD HAVE DONE EVEN BETTER, HAD IT NOT BEEN FOR THE TARIFFS, BUT IT IS ABOUT, YOU KNOW, THE SAME PACE WE HAD SEEN IN THE YEAR BEFORE.

OF COURSE, THAT'S AN AVERAGE.

FOR SOME CONSUMERS, IT WAS A LOT WORSE, BUT FOR SOME, IT WAS EVEN BETTER.

>> WAGES HAVE BEEN STAGNATING FOR YEARS, WHY ARE THEY STARTING TO GO UP, NOW?

>> YOU KNOW, THEY HAVE BEEN -- THE LAST COUPLE OF YEARS, ACTUALLY, IT STARTED AROUND 2015, SO WE HAVE NOW, A DECADE WHERE REAL WAGES HAVE BEEN RISING FASTER, AND SOME OF THAT IS, PRODUCTIVITY IS FASTER.

WHEN YOU GET MORE PRODUCTIVE, YOU TEND TO HAVE HIGHER WAGES.

SOME OF IT IS THE INCREASE IN INEQUALITY AMONG WAGE EARNERS HAS STABILIZED.

YOU STILL HAVE A GROWTH OF INEQUALITY BETWEEN WEALTH AND ARE NOT SEEING THE SAME INCREASE IN INEQUALITY YOU WERE SEEING BEFORE.

>> WHAT AFFECTS HAVE CAME FROM THE CRACKDOWN ON IMMIGRATION, LEGAL AND ILLEGAL?

>> THAT HAS DRAMATICALLY SLOWED THE PACE OF JOB GROWTH.

WE BASICALLY HAVEN'T HAD ANY JOB GROWTH OVER THE PAST YEAR.

PREVIOUS YEARS WE HAD HAD, YOU KNOW, 100,000 JOBS PER MONTH OR MORE BUT IT ALSO MEANS WE DON'T NEED AS MANY JOBS TO KEEP THE UNEMPLOYMENT RATE CONSTANT, SO EVEN THOUGH JOB GROWTH HAS SLOWED, UNEMPLOYMENT ONLY INCREASED A LITTLE BIT OVER THE LAST YEAR, AND THAT IS BECAUSE WHEN YOU HAVE MORE IMMIGRANTS, LEGAL OR ILLEGAL, YOU NEED MORE JOB GROWTH, SO WE DON'T NEED QUITE AS MUCH JOB GROWTH AS WE USED TO NEED.

>> IS THAT WHAT CHAIRMAN JEROME POWELL MEANT WHEN HE SAID, "IT LOOKS LIKE THAT IS ABOUT WHAT THE ECONOMY NEEDS," IN TERMS OF DEALING WITH VERY, VERY LOW GROWTH IN THE LABOR FORCE WHEN HE SAID, "IT DOESN'T REALLY JOB GROWTH?

>> YEAH, THAT IS EXACTLY RIGHT.

I MEAN, THE QUESTION FOR ANY COUNTRY, YOU KNOW, WHETHER YOU ARE LOOKING AT GERMANY, OR LUXEMBOURG, OR CHINA, IS, HOW MANY JOBS DO YOU NEED?

IN LUXEMBOURG, YOU DON'T NEED THAT MANY JOBS.

IT IS SMALL.

IN CHINA, YOU NEED AN AWFUL LOT OF JOBS.

TO ANSWER THAT QUESTION, IT'S NOT JUST THE SIZE OF THE COUNTRY, BUT THE DEMOGRAPHY.

WE HAVE A LOT OF PEOPLE WHO ARE REACHING RETIREMENT AGE NOW, WE HAVE FEWER PEOPLE REACHING WORKING AGE NOW, SO YOU TAKE ALL OF THAT INTO ACCOUNT, AND ABSENT IMMIGRATION, OUR LABOR FORCE IS ROUGHLY FLAT.

WE HAD AS MANY PEOPLE RETIRING AS ENTERING THE WORKFORCE.

WE ACTUALLY DON'T NEED JOBS IN ORDER TO KEEP UNEMPLOYMENT CONSTANT.

NOW, I WOULD RATHER WE HAD MORE IMMIGRATION, AND MORE JOB GROWTH, AND MORE ECONOMIC GROWTH, BUT IN TERMS OF JOBS FOR EVERYONE WHO NEEDS ONE, RIGHT NOW, A NUMBER OF 25,000 OR 50,000 PER MONTH, IS PLENTY.

>> WE HAVE WHAT IS CALLED, A CAKE SHAPE ECONOMY WHERE THE SPENDING BY WEALTHY AMERICANS IS DRIVING A GREATER SHARE OF THE GROWTH WHILE WORKING CLASS AND POOR AMERICANS, LESS SO.

WHAT ARE THE RAMIFICATIONS OF THAT?

>> WELL, I AM NOT ACTUALLY SURE THAT WE ARE SEEING THAT IN THE DATA ON CONSUMPTION.

UNFORTUNATELY, THE GOVERNMENT DOESN'T REPORT DATA ON CONSUMPTION BY INCOME GROUPS, SO DIFFERENT ECONOMISTS HAVE CUT IT DIFFERENTLY.

THE BEST MEASURES I HAVE SEEN ACTUALLY SHOW MODERATE INCOME FAMILIES CONSUMING AT, YOU KNOW, AS MUCH OF A RATE AS HIGH INCOME.

MAYBE EVEN A FASTER RATE.

NOW, JUST TO BE CLEAR, THERE IS A LOT OF INEQUALITY.

THERE IS GROWING WEALTH INEQUALITY, GIVEN HOW MUCH THE STOCK MARKET HAS RISEN, BUT WAGE INEQUALITY, IF ANYTHING, HAS NARROWED OVER THE LAST DECADE, SO THE INEQUALITY TRENDS ARE A LITTLE BIT COMPLICATED.

SOME MEASURES OF IT GO UP, SOME MEASURES OF IT GO DOWN.

THE STARKEST IS THE STOCK MARKET, BUT THE BEST NEWS IS COMING OUT OF THE LABOR MARKET, WHERE YOU HAVE STARTED TO SEE BOARD.

>> YOU SAID, THE ECONOMY HASN'T CHANGED THAT MUCH BUT THERE IS ONE ISSUE THAT REALLY, OVER THE PAST 10, 15, 20 YEARS KEEPS GETTING WORSE, WHICH IS AFFORDABILITY.

AND THAT ESPECIALLY COMES DOWN TO HOUSING AFFORDABILITY, AND FOR PEOPLE, AS WE SAY, IN THE YOUNGER PEOPLE, PEOPLE IN THEIR 20s, THINGS JUST AREN'T AFFORDABLE.

WHAT HAS BEEN CAUSING THE AFFORDABILITY CRISIS?

>> YEAH, SO, ANYTHING YOU WANT TO CONTEXTUALIZE OVER 10 OR 15 YEARS, I WILL COMPLETELY AGREE WITH YOU.

WHAT I DON'T LIKE IS SAYING, "ALL OF A SUDDEN, AFFORDABILITY IS A PROBLEM AND IT WAS FINE BEFORE."

HOUSING IS -- WE JUST DON'T LET PEOPLE BUILD AS MUCH AS THEY WOULD LIKE TO BUILD IN THE PLACES THAT ARE MOST DESIRABLE.

I THINK SUPPLY IS THE BIGGEST PART OF IT.

INTEREST RATES AND HIGH MORTGAGE RATES ARE ANOTHER PART OF IT, AND THAT IS RELATED TO HAVING A LARGE BUDGET DEFICIT.

WHEN THE GOVERNMENT IS BORROWING A LOT, IT IS COMPETING FOR CAPITAL, DRIVES UP INTEREST RATES, THAT MEANS, YOU KNOW, ORDINARY AMERICANS MORTGAGES.

HEALTHCARE HAS BEEN ANOTHER CHRONIC AFFORDABILITY ISSUE.

AND, YOU KNOW, THE ISSUES GET VERY, VERY COMPLICATED IN DELIVERY SYSTEM REFORM, THERE IS NOT A SINGLE MAGIC BULLET THAT WILL SOLVE THAT, BUT THERE IS LOTS AND LOTS OF THINGS THAT YOU KNOW, WE SHOULD BE DOING.

>> IF YOU TALK ABOUT LONG-TERM ISSUES, THE BIGGEST ONE SEEMS TO BE THE HOLLOWING OUT OF AN AMERICAN MIDDLE CLASS, AND AN AMERICAN WORKING CLASS.

IS THAT TRUE?

AND HOW CAN THAT BE REVERSED?

>> LOOK, SOME OF THE HOLLOWING OUT IS PEOPLE WHO ARE MIDDLE- CLASS BECOMING AFFLUENT.

WE JUST HAVE MORE AND MORE OF OUR POPULATION AS AFFLUENT THAN EVER BEFORE AND THAT IS A REALLY WONDERFUL THING.

WE HAVE SEEN FASTER WAGE GROWTH FOR HOUSES AT THE 10th, 20th, AND 30th PERCENTILE, THEN WE HAVE AT THE 80th OR 90th PERCENTILE, THAT HAS BEEN GOING ON FOR ABOUT A DECADE, NOW.

THAT IS ANOTHER PIECE OF GOOD NEWS.

BUT, WE NEED TO BOTH PREPARE PEOPLE BETTER FOR JOBS --I THINK EDUCATION WILL CONTINUE TO MATTER.

I AM WORRIED ABOUT WHAT A I WILL DO TWO JOBS, I AM MORE WORRIED FOR PEOPLE THAT DON'T HAVE A COLLEGE DEGREE THAN PEOPLE WHO DO, NOTWITHSTANDING ALL THE CONVERSATION ABOUT WHAT IT DOES FOR WHITE-COLLAR JOBS.

AND THE OTHER THING WE NEED IS TO RUN AN ECONOMY THAT IS A STRONG AS CAUGHT POSSIBLE, SO MORE BALANCED ECONOMIC GROWTH, LESS RELIANCE ON ONE SECTOR OF THE ECONOMY, YOU KNOW, MORE SPREADING IT ACROSS THE BOARD.

>> WELL, LET ME PUSH BACK A LITTLE ON WHAT SEEMS TO BE YOUR OPTIMISTIC SCENARIO, WHICH IS THAT, REALLY, IN THE PAST 30, 40 YEARS, THAT ABILITY TO GET A GOOD JOB, AND A GOOD WAGE, LIKE AT A MANUFACTURING PLANT OR A FACTORY, KNOW THAT JOB WOULD BE SECURE, BE ABLE TO BUY A HOME BY AGE 30, THAT SEEMS REALLY TO HAVE BEEN GUTTED.

AM I WRONG ABOUT THAT?

>> I LOOK AT WHAT FRACTION OF THE POPULATION AGED 25 TO 54 IS WORKING, FOR EXAMPLE, BECAUSE YOU CAN EXCLUDE SOME PEOPLE OF RETIREMENT AGE AND OF SCHOOL AGE AND THAT IS BASICALLY NEAR THE HIGHEST IT HAS BEEN IN 25 YEARS.

LOOK AT HOW WAGES COMPARED TO PRICES.

THEY HAVE GROWN FASTER FOR ABOUT A DECADE, NOW.

I LOOK AT THINGS LIKE THE SIZE OF THE HOUSES THAT PEOPLE HAVE TODAY, THE NUMBER OF SQUARE FEET, THE AMOUNT OF APPLIANCES, ALL OF THAT, MORE THAN IT WAS IN THE PAST, SO I THINK WE DO HAVE A LITTLE BIT TOO MUCH OF A BAD NEWS BIAS AND WE NEED TO SIMULTANEOUSLY KEEP IN OUR MINDS, THINGS COULD BE EVEN BETTER.

WE HAVE MADE UNFORCED ERRORS, WE HAVE NOT DONE SOME OF THE THINGS THAT COULD HELP.

WHILE ALSO REMEMBERING, YOU KNOW, LIFE 25 YEARS AGO WASN'T QUITE AS IDYLLIC AS WE SOMETIMES REMEMBER IT AS HAVING BEEN.

>> JASON FURMAN, THANK YOU SO MUCH FOR JOINING US.

>> THANK YOU.

>>> AND FINALLY, NEVER BEFORE SEEN PICTURES OF THE FIRST MAN ON THE MOON.

IN MARCH OF 1966, NEIL ARMSTRONG AND FELLOW ASTRONAUT DAVID SCOTT ENDED THEIR GEMINI 8 MISSION EARLY, FOLLOWING A LIFE-THREATENING EMERGENCY SQUASHING DOWN OVER THE COAST OF OKINAWA, JAPAN.

NOW, 60 YEARS LATER, UNRELEASED PHOTOS OF THEIR HEROIC RETURN HAVE BEEN DONATED TO A MUSEUM IN OHIO.

OBSERVERS ARE STRUCK BY THEIR SMILES!

THE ASTRONAUTS WEARING WIDE GRINS AS THEY WALKED THROUGH THE CROWDS AND ONTO THE RECOVERY SHIPS THAT PICKED THEM UP.

CERTAINLY, IT SPEAKS TO THEIR PROFESSIONALISM AFTER A CRISIS, AND PERHAPS, RELIEF THAT THEY MADE IT OUT ALIVE.

AND THAT IS IT FOR OUR PROGRAM TONIGHT.

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THANK YOU FOR WATCHING "AMANPOUR AND COMPANY" --JOIN US AGAIN, TOMORROW NIGHT.