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Fareed Zakaria GPS
Interview with Former Joint Chiefs Chairman Admiral Mike Mullen About Taiwan and Ukraine; Interview With Taiwan Semiconductor Manufacturing Company Chairman Mark Liu. Aired 10-11a ET
Aired July 31, 2022 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
ALBANESE: It should be a short of great pride and my priority is getting that constitutional change done first.
TAPPER: Prime Minister Albanese, thank you so much. And again congratulations on your victory.
ALBANESE: Thanks very much, Jake. Good to be with you.
TAPPER: And thank you for spending your Sunday morning with us. "FAREED ZAKARIA GPS" starts right now.
FAREED ZAKARIA, CNN ANCHOR: This is GPS, the GLOBAL PUBLIC SQUARE. Welcome to all of you in the United States and around the world. I'm Fareed Zakaria coming to you live from New York.
Today on the program those who play with fire perish by it. That was Chinese President Xi's warning this week to President Biden over Taiwan. The big question, will Speaker Pelosi travel to the island after all and risk China's ire? If she does, how might China respond?
I will talk to the former chairman of the Joint Chiefs of Staff, Admiral Mike Mullen, about that.
And the latest efforts in Ukraine's war. Trying to take back territory from Russia.
Also, one of the biggest business fears about a potential Chinese attack on Taiwan is what happens to TSMC? This is the most valuable company in all of Asia. It makes many of the chips in many of your high tech devices. I get a rare interview with the company's chairman and ask him about those fears.
But first, here's my take. Is it possible that despite all the partisan noise and expert disbelief Joe Biden is actually managing to do something that he promised during his campaign? Govern from the center. The evidence is piling up. If the compromise hammered out on Wednesday between Chuck Schumer and Joe Manchin passes, it will be the largest investment in fighting climate change made by the federal government while also being the largest deficit reduction package in a decade. The deal comes on top of the Chips and Science Act, which makes
massive investments in basic research and critical technologies. That followed the first bipartisan gun control legislation passed in a generation. And that was preceded by a trillion-dollar infrastructure bill that had been one of Donald Trump's signature campaign promises.
Governing from the center in today's world looks a lot different than it did in the past. When Congress came together in the 1980s and '90s to pass big bipartisan bills, saving Social Security, reforming taxes, helping Americans with disabilities and reducing air pollution, the authors of the bills were often lionized in the media and even within their own parties.
Today the incentives in Congress are to never compromise. Holding out against the other party which is regarded not as the opposition, but as the enemy, is a badge of honor. That is what allows you to fundraise from the most radical elements on your side of the spectrum.
One big bipartisan effort to address immigration reform stalled in the early 2000s because it was viciously attacked by the extremes of both parties. The DREAM Act was supported by two of the most ideologically opposed senators, Ted Kennedy and Orrin Hatch, who are also good friends. They were among the oldest members of the Senate and perhaps embodied an old way of governing that was out of tune with partisan warfare.
The Gingrich Revolution of the 1990s had changed the Republican Party and soon Washington itself. Compromise was considered a sell-out, even treasonous.
In trying to revive that old model of governing, Biden is fighting against the tide, but surprisingly in small but significant ways he's winning. If more bipartisan bills get passed, and if legislators don't get punished for working across party lines, even get rewarded for it, that might begin to shift some of the incentives and reduce the toxicity in Washington.
For the Democrats there is a real potential upside here. They are better positioned than Republicans to become a big tent party. As a notable Brookings study has shown, in 2020 Biden's victory came from the suburbs. And those voters are presumably more moderate and centrist than, say, the Democrats' primary base.
And suburban voters seem to be increasingly turned off by Republican positions on issues such as abortion and guns. In the wake of the Supreme Court's overturning of Roe v. Wade, the generic congressional ballot has moved from favoring Republicans to being essentially a tie.
Being a big tent party is hard.
It does mean holding coalitions together, including people with whom you profoundly disagree. But in a large diverse country of 330 million people, it is the only way to gain working majorities. Some of the greatest Democratic accomplishments have taken place in that spirit. Franklin Roosevelt deferred action on civil rights so that he could pass the new deal. Lyndon Johnson enlisted the segregationist South to support much of his great society legislation.
Bill Clinton had to govern mostly with a Republican-controlled Congress. And when Barack Obama had congressional majorities, he chose to prioritize universal health care over many other important social issues, including gay marriage.
Sometimes compromise can actually lead to better outcomes. For example, the Kennedy-Hatch immigration bill was in my view a better plan than either party would have independently passed because both sides have legitimate concerns and valid arguments that got represented.
Some of Joe Manchin's arguments in the past year have similarly been credible. He's argued against making bills look affordable by shoving in lots of programs, but then funding them only for a year in the hope that they will get extended annually. On climate his view that we should not choke off fossil fuels before we have enough green technologies at scale to replace them might be self-serving for the senator from West Virginia, but it also happens to be an accurate read of where we are today.
More importantly, please remember that Joe Manchin represents a state that Donald Trump won by about 40 points in 2020. The wonder is surely that he's willing to go as far as he has already. If Democrats can keep him with them, by definition we are building a big tent, one that could encompass the majority of Americans.
Go to CNN.com/fareed for a link to my "Washington Post" column this week. And let's get started.
Speaker of the House Nancy Pelosi, who is second in line for the presidency, is embarking on a tour of the Indo-Pacific. The burning question is, will one of the stops be Taiwan? Her office released a statement on the trip this morning with some visits listed. Taiwan was absent. But it's not the kind of stop she would probably telegraph.
China has made it abundantly clear that a visit to Taiwan would be seen as a great escalation. Beijing said it would take resolute and forceful measures in response to such a visit.
To make sense of this all, I want to bring in Admiral Mike Mullen. He was chairman of the Joint Chiefs of Staff between 2007 and 2011. In that role he was the chief military adviser to Presidents George W. Bush and Barack Obama.
Welcome, Mike. Let me ask you first, isn't it likely that Nancy Pelosi has decided not to go to Taiwan? In other words, when the speaker of the House issues a press release where she lists the places she's going, she did say that the trip will include those stops. Is it possible she might make a surprise visit to Taiwan even though she hasn't listed it?
ADM. MIKE MULLEN (RET.), FORMER JOINT CHIEFS CHAIRMAN: Hi, Fareed. It's really good to be with you. I would expect that it is very possible that she could still make a surprise visit. As controversial and as important as this has become, I wasn't surprised at all that it wasn't part of the released schedule and she's in that area of the world -- she's been there many, many times in that area of the world.
She feels strongly about supporting the kinds of values that we stand for and working with our friends. So, again, and Taiwan has been a friend for a long time, and particularly in a bipartisan way. So it wouldn't surprise me if she went.
ZAKARIA: Now she was speaker of the House for part of the time you were in the chairman of the Joint Chiefs of Staff. She's a tough, uncompromising person, wouldn't you say?
MULLEN: Yes, she's a very, very tough woman who knows how to get things done. She cares deeply about the security of our country and the world. She cares deeply about human rights. So I don't think she would do anything that she hadn't really thought through. She understands the stakes and in the end I think, while if she decides to go, there certainly is increased risk with respect to that but I think she would do that thinking through the possibilities and the risks very, very well.
ZAKARIA: How do you think we got to this stage? You know, frankly it seems surprising to me that the two leading powers of the world have such bad communications that something like this has become a crisis which has a more hair trigger element to it, there's much less known about it, both sides there seems deep mutual distrust. It does feel like a kind of breakdown of diplomacy.
MULLEN: Yes, I think that's true. And that's been over certainly the better part of a decade. As is often the case, Fareed, these things happen over time. I think the sanctions that have been imposed on China, we're a part of it. I think the new leadership and quite frankly the conviction of Xi Jinping, President Xi Jinping in China to impose an authoritarian view, not just in the region, but around the world.
I think the lack of trust, you know, we've had in the U.S., literally thousands of companies where China has stolen the intellectual property, so I think the tensions quite frankly coming out of the Trump administration were pretty high and that has continued in the Biden administration and gotten more difficult.
Xi Jinping has had a pretty difficult year. He signed up with Putin just before the Olympics. His economy is not growing anywhere close to what he expects. He's not been very successful in the Zero COVID strategy that he's imposed. There are many companies who are being shut down. You see the reemergence of state-owned enterprises and this was supposed to be a big year for him because of the election in November which would generate a third term.
So there's an awful lot going on internally in China that's not going his way. I would hope that we don't and no one gives Xi Jinping a relief valve, if you will, or a life ring as he's having so many difficult issues internally over the course of, you know, the last year or two.
ZAKARIA: Let me ask you about your trip to Taiwan. You took a trip to Taiwan at the president's behest. You led a delegation of American private citizens, mostly former officials. What was your principal takeaway from that visit to Taiwan?
MULLEN: Well, first of all, it was in March. It was right after the Ukraine invasion by Russia. Secondly, it was a bipartisan trip. So we had officials from both sides of the aisle, if you will. There were several takeaways. One of which is President Tsai Ing-wen is a very strong leader, very comfortable in her own skin and understands the issues.
Secondly, this is a thriving democracy of 24 million people with our values, with our focus on democracy and freedom. 75 percent of whom support independence from China. And then thirdly, that China has been incredibly coercive with respect to Taiwan over the last several years. And while I very strongly support the policy of the United States, which is strategic ambiguity, I think because of that coercion whether it's military or economic or otherwise, that it's a little out of balance.
It's been mostly imbalance for over 43 years with the structure that we've had. And I think that countries like us, particularly the U.S., there's room for us to sort of rebalance the scale, not to change the policy because the policy, you know, is really between Taiwan and the mainland.
And then lastly is the impact of what's happened in Hong Kong. You know, that really has gotten a very sober view in Taiwan that was supposed to be, you know, one system --
ZAKARIA: One country, two systems. Yes.
MULLEN: Yes. One country, two systems. And that obviously has gone by the wayside. There are no discussions that I have, Fareed, with respect to Ukraine that don't eventually lead to the question about whether China is going to do the same thing in Taiwan. So back to where I started, President Tsai is very focused on this. She needs support and she's had good support from the U.S. The country is -- I'm sorry, Taiwan is very isolated from the world. China has done a really good job of doing that.
So a visit by somebody like Speaker Pelosi will broaden Taiwan's perspective, which I also think is important.
ZAKARIA: Stay with us. When we come back, I'm going to ask Admiral Mullen about the war in Ukraine. His views when we come back.
ZAKARIA: Just days after the Russian invasion began the Ukrainian city of Kherson fell. It was the first major city to be taken by Russia. Now Ukraine is mounting a major counteroffensive to take it back. Can it work?
Joining me again, Admiral Mike Mullen, the former chairman of the Joint Chiefs of Staff.
Mike, so, let me put it to you first. Can this counteroffensive really work? And more broadly, the Ukrainian army is still outnumbered 10-1 by the Russian army. The Russians have much larger defense budget. Can Ukraine actually win this?
MULLEN: Well, I think they can, Fareed. It's been amazing what the Ukrainian army and the Ukrainian people have done so far. And even though outnumbered, seemingly it is more than evenly balanced because of the continued incompetence of the Russian army, mostly army, but Russian armed forces, which has been from my perspective somewhat stunning.
I think, as I look at this, this is from my interactions with my European friends, Europe thinks this is existential. I think Putin is existential. And I think Sweden and Finland joining NATO so quickly, or poised to do so, is just an example of that. I do believe that Putin still wants all of Ukraine and he will continue to fight accordingly.
I think he's a little bit out of touch in terms of what's going on on the ground and out of touch on how badly his forces have performed. But they're better now than they were early. And, you know, unconstrained and unopposed, he'll try to take all of Ukraine.
This is a long slog of a fight for Putin in particular to gain his objectives. And I think he has to be stopped. I don't think he's going to stop. I think he has to be forced to settle with respect to how this comes out. And we -- our allies, NATO, the United States in particular, have to keep providing the kind of arms we have at a rate that will allow the Ukrainians to continue to oppose and sustain the kind of counteroffensive that you're talking about.
The spirit is there, the will to fight is there. They have to have that capability. So on balance, you know, I think the Ukrainians will succeed. I just think it's going to take a long, long time to do that. And then that gets into, you know, what should the United States do? What does the E.U. do in terms of willingness to suffer to make sure this never happens again? And I think that's the case.
If you've dealt with the Baltics, Estonia, Latvia, Lithuania, they think they're next. I would agree with that if we don't stop Putin now. So we all have to kind of brace for a long one and put Russia I think and Putin in particular in a position to not do this again.
ZAKARIA: So let me ask you about one very important piece of this in terms of putting pressure on Russia because right now even if Russia doesn't go any further, it has managed to strangle Ukraine economically by shutting down the port of Odessa, by shutting down all Ukrainian -- almost all Ukrainian exports by sea, which is where the bulk of them used to go. All the grain for example.
I've been publicizing Admiral Stavridis, a former NATO commander, has been proposing that the United States and NATO effectively open up Odessa so that Ukraine can export to the world. There's a kind of reflagging operation we did around the Persian Gulf several years ago that are well familiar with, so there's a way to do it which where it doesn't come across as an act of war. It's more kind of noticed to Maritimers. Is there such a solution in your view? You're the former chairman of the Joint Chiefs but also an admiral. Could the U.S. Navy do something to unlock Odessa?
MULLEN: Well, I think it's a decision for President Biden and honestly I've been mystified that we haven't put U.S. Navy ships up into the Black Sea to create the kind of corridor that you're speaking of and that has been mentioned before by other individuals who served. It is doable. The worry that I have is the longer we delay that, the harder it's going to be. Those who operate at sea, both on the Russian and the U.S. side, understand that that environment and contrary or different from the use of, quote-unquote, "potential use of nuclear weapons."
There's nothing that's going to happen at sea that's going to turn this into World War III specifically. And you now see the human carnage associated with it. And I think the U.S. and our allies quite frankly have to do a lot more to control the Black Sea and control that sea lane so that we can get that grain and those exports out to so many needy countries who are on the edge of food insecurity when this war started and now are deeply into it, probably much more deeply than we really understand.
ZAKARIA: Admiral Mullen, always a pleasure to have you on. Thank you, sir. And we will be back.
ZAKARIA: Taiwan Semiconductor Manufacturing Company. It's an old school name for one of the most modern state of the art companies in the world. If you've never heard of the company known as TSMC, you'll want to listen closely. Its products are semiconductors, the heart of all high tech.
And their chips may very well be in your cell phone, your computer, your car and your TV. They manufacture chips for the biggest tech brands all over the world. American brands most notably Apple, Chinese brands, Europe ones and more.
TSMC is the most valuable company in all of Asia. More impressively perhaps it is the 10th most valuable company in the entire world. The company is building a $12 billion advanced chip manufacturing plant in Arizona thanks in part to expected subsidies from the U.S. government which passed this weekend, the CHIPS Act. So why am I telling you about TSMC now? Well, as the "Wall Street Journal" said last year in a headline, "The World Relies on One Chip Maker in Taiwan, Leaving Everyone Vulnerable."
So when China threatens forceful measures over Speaker Pelosi's plans to visit Taiwan, fears of an attack on Taiwan rise and many in the tech and business world think immediately of TSMC. I had the pressure of a rare interview with its chairman, Mark Liu.
ZAKARIA: What would happen to Taiwan and to the Taiwanese economy if China were to invade?
MARK LIU, CHAIRMAN, TAIWAN SEMICONDUCTOR MANUFACTURING COMPANY: Of course, the war brings no winners. Everybody is losers. And the people in Taiwan has earned their democratic system in Taiwan and they want to choose their way of life. And we think that, indeed, the chip supply is a critical business in the economy in Taiwan, but having a war in Taiwan, probably the chip is not the most important thing we should worry about because this invasion if it come after the -- is the destruction of the world base order. There is no -- the geopolitical landscape will totally change.
ZAKARIA: Do you worry that Taiwan is now is so integral to the Chinese supply chain at the high end that that -- does that create a danger for Taiwan or is it a deterrent? People sometimes talk about the TSMC shield. But you could equally see Beijing saying, we need to -- we need to have total control of this. This is the most valuable asset and it's outside our borders.
LIU: OK. Nobody can control TSMC by force. If you take a military force or invasion you will render TSMC's factory non-operable because this is such a sophisticated manufacturing facility. It depends on the real time correction with the outside world, with Europe, with Japan, with the U.S., from materials to chemicals to spare parts to engineering software diagnosis. And it's everybody's effort to maybe this factory operable. So if you take it over by force you can no longer make it operable.
In terms of the China business, today they compose about 10 percent of our business. We only work with consumers. We don't work with military entities. We only work with the consumer market. We think that is a -- consumer pulse is important and it is vibrant. And if they need us, it's not a bad thing.
ZAKARIA: Expand on that. Why is it not a bad thing?
LIU: Because our interruption will create great economic turmoil in either side. In China because they -- suddenly their most advanced components supply disappeared and it's -- it is an interruption, I must say. So people will think twice on this.
I think the Ukraine war -- I think we should draw lessons from it. People think Ukraine war connects with Taiwan Strait. We are very different. But in case you think about in parallel Ukraine war is not good for any of the sides of the western world, of Russia, for Ukraine. It's lose, lose, lose scenarios. All three sides ought to draw lessons. I think they do. And we should use those lessons to look at the lens on Taiwan.
How can we avoid war? How can we ensure no -- the world economy -- engine of the world economy continue coming and let's have a fair competition on top of the platform. That's what I think.
ZAKARIA: Next on GPS, more with Mark Liu, the chair of Asia's biggest company, the chip maker TSMC, as he warns China against invading Taiwan. Back in a moment.
ZAKARIA: We are back here on GPS bringing you more of my interview with one of the most important people in the world you've probably never heard of. Mark Liu is the chair of the chip maker TSMC. "Time" magazine said the company makes the world's tech run. And it's true.
Their high quality chips are likely inside many of the high-tech products you interact with every day. For instance, you have an iPhone in your pocket, a laptop or desktop. While Apple is a major client of Taiwan base TSMC whose chips are also in countless phones, computers, cars, refrigerators and much, much more. I wanted to hear more about how the company achieves all this in the shadow of China.
ZAKARIA: From your perspective, what explains the Taiwan miracle? This is now a place that has grown at five percent a year for five decades. There are very few places in the world that have managed that. What explains the Taiwan miracle?
LIU: Looking from outside it appears to be a miracle. For the people working hard on the island it is just a history of fighting. I think, to be honest, compared with other nations, particularly in Asia, I think one of the key components in Taiwan is a peaceful society. It maintains peace since 1949 until today, 70 years it's a peaceful island.
And during the period of time that Taiwan has transformed from authoritarian state into a democratic state, a democratic society, peacefully, this is marvelous. Because if you look at nations around the world, having such a smooth transition, peaceful transition that is -- we are fortunate to be honest.
But if you talk about the miracles, I also think there's one thing that is very distinctly different is the education system. When I was young, only 10 percent of the young people entered college or universities. Today, 80 percent of the young people have college or university degrees.
The government set up many colleges, universities. And every kid, if you want to go to university, you can go as long as you spend time. So that has created a relatively good quality of population in Taiwan posing for change ahead. That's why I think it's very, very special.
ZAKARIA: Why is it so difficult for anyone to make the chips that is you make? And I'm thinking now about the seven-nanometer. You know, the Americans have these great companies, huge history like Intel. The Chinese pour tens of billions of dollars into new companies, but no one can make the chips you make. Why?
LIU: Well, they can, just a few years later.
ZAKARIA: But that's all the difference in this business.
LIU: You're right. That's all the difference. I think the -- we treat the semiconductor technology itself as a business, as a science. It's not assembly workers. And, of course, I credit this to be working with our partners. Even the COVID time our engineers used AR, augmented reality, lenses to work with engineers in Netherlands, work with engineers in California. And that's how we -- how close we work together. And together we pushed a frontier of the semiconductor technologies among -- I cannot tell you everything why but that's (INAUDIBLE) --
ZAKARIA: You're not going to tell me the secret formula for Coca-Cola. Finally, tell me what you think Taiwan will look like in the future, technologically, economically. What are your -- what are your hopes?
LIU: I hope that we don't get discriminated because we are close to China. No matter your relationship with China, Taiwan is Taiwan. You have to look at Taiwan as a -- by itself a vibrant society. We want to unleash the innovation for the world into the future continuously and not to be scared because we have some dispute with our neighbors and that is not worth it.
ZAKARIA: But it seems to me you're saying to the world, correct me if I'm wrong, you're saying to the world, don't be scared by the -- by what China is saying because the Chinese will never be able to take over the Taiwanese economy. The Taiwanese economy is built on this global collaboration, on trust, on openness. They'll find they've taken over nothing if they come in.
LIU: Correct. Yes, I do believe so. The war can only create problems on three sides -- all three sides and that is -- we need to prepare for the worst, but we should hope for the best.
ZAKARIA: Yes. You said about the Ukraine war, it's lose, lose, lose. Your hope is for win, win, win.
LIU: At least not lose, yes. If you have a war, then it will be that. If it's peaceful among the competition strategies on all three sides and I think that is -- nobody in the business world wants to see a war happen and why do we -- why do we jump again into another trap?
ZAKARIA: Thank you for taking so much time.
LIU: Thank you very much, Fareed. I enjoyed talking to you.
ZAKARIA: Next on GPS, Hungary's Prime Minister Viktor Orban warned last weekend that Europe might become a mixed race world. Well, I have news for him. Hungary's great strength for many centuries has been the diversity of its population. I'll give him a history lesson when we come back.
ZAKARIA: And now for the last look. This coming week at the influential CPAC conference in Dallas, alongside Donald Trump, Ted Cruz and more than 20 Republican members of Congress, conservatives are welcoming a foreign leader, Hungary's Viktor Orban.
I wonder if Orban will give a version of his latest major speech in a spa town in Romania last weekend he warned that Europe was in danger of becoming a mixed race world. A trend, he said, Hungary had always resisted. "We are willing to mix with one another, but we do not want to become peoples of mixed race," he said.
Someone needs to give Orban a lesson in Hungarian history. Scholars have found that the conquerors who alighted on modern day Hungary in the ninth century migrated from as far away as southern Siberia and with the genetic relatives of central Asians, Caucasian, and Slavs.
The Hungarian language is completely different from than that of its neighboring countries deriving from the Ural region with similarities to Finnish and Estonia. And a DNA testing firm found that of nearly 5,000 Hungarians who took their test 7.5 percent had at least a quarter Ashkenazi Jewish ancestry, the highest prevalence the firm found in any country outside of Israel. So the idea of some sort of pure Hungarian race is a fantasy.
Orban's comments last week don't just defy history, they fly in the face of the core feature that has historically made his own country great. Remember, Hungary was an equal partner in the Austro-Hungarian Empire which was among the most diverse territories in human history.
As the scholars Paul Miller-Melamed and Claire Morelon wrote in the "New York Times" it had at least 11 officially recognized languages and a multiplicity of religions including Catholicism, Judaism, Islam and various forms of Orthodox Christianity. Its bureaucracy, its army and its schools were all multilingual. When the mobilization orders were given to the army to attack Serbia in 1914, they were given in about a dozen different languages.
The empire's two seats of government, Vienna and Budapest, were two of the greatest economic and cultural capitals of the world, magnets for minorities who flourished in them. But Orban seems to have a very specific focus for his current ire. His speech last weekend singled out a very specific group, Muslims. He said, menacingly, "Islamic civilization is constantly moving towards Europe."
This is a common refrain for Orban. Last year, during the speech in Budapest he said that while he supported neighboring Bosnia's bid to join the E.U. it would be complicated by one snag, the existence of the country's 2 million Muslims.
And, again, Viktor Orban is turning a blind eye to history. Muslims have been present in Europe since the 8th century when the Umayyad dynasty conquered must of the Iberian Peninsula, which they called Al- Andalus. The Ottoman expanded to southeast and central Europe at the height of their power and attempted but failed to capture Vienna twice. Islam has been in Hungary for about a millennium and actually ruled parts of the country in the 16th century.
Today, however, Muslims make up 0.4 percent of the population of Hungary. That is some threat.
There is a gruesome history surrounding rhetoric like Orban's in his own country. It is what led in the 1930s to the passage of some of the harshest laws against Jews, the revived minority at the time, mostly copied from the Nuremberg Laws in Germany.
Hungary had a Jewish population of over 800,000 in that period. Today there are just about 100,000 Jews in Hungary. One of Orban's own aides resigned in disgust in his latest effort at race-baiting, describing the speech as a Nazi text worthy of Joseph Goebbels. If there are still honorable conservatives left at CPAC they should disinvite Viktor Orban and distance themselves from his poisonous message.
Thanks to all of you for being part of my program this week. I will see you next week.