Welcome to the defense and aerospace report I’m foggy morodian here at the Ronald Reagan Presidential Library and Museum in Simi Valley California where we’re covering the Reagan National Defense forum our coverage here is sponsored by Leonardo DRS and we have the honor of talking to one of America’s greatest public servants a man George Shultz who had a distinguished.

Career in academia in business and in government a marine artillery officer in world war ii after the war he went to MIT and earned his PhD in economics and then went on to serve presidents Eisenhower Nixon Reagan and.

George W Bush and advised just about every other president since he is also one of two people.

The distinction of holding four cabinet offices including the Secretary of Labor the very first director of the Office of Management and Budget Treasury secretary and Secretary of State and to boot in your spare time sir you.

Came up with the idea of the g7.

Group of industrialized nations it’s an honor dr.

Shultz thank you with all that recitation I’m exhausted well your your accomplishments are incredible and I’m really honored to have this opportunity to talk strategy with you it’s a very very difficult time it’s a multipolar world China is rising Russia continues to provoke the North Koreans continue to be a challenge as are the Iranians.

As is violent extremism the Trump administration is trying to wrap its.

Hands around a new national security strategy in your estimation what’s the right kind of strategy the nation needs at a confused global period.

A contested global period like this the first step is to understand what’s.

Happening and there are four.

Major forces that are reshaping the world fundamentally and rapidly these.

Are number one the demography of the world is changing very fast fertility in most developed countries is very low.

Longevity is increasing the structure of the population is changing that has big implications the places where there is rising populations are mostly areas where the economy is not doing well where global warming is probably going to make life very difficult so I.

Think it’s likely that we’re going to see major migration issues so this is one point the second is that with the huge communications.

And information revolutions governance has become much more difficult because diversity is everywhere it used to be that people ignored it or suppressed it.

Can’t do that anymore so you have to learn how to govern over diversity and people really haven’t figured that out so we see lots of turmoil and then you have artificial intelligence which is rapidly changing the way tasks get done of all kinds and when you combine that with 3d printing which really should be called additive manufacturing you can build almost anything they build things that will upset security and can build things that you can produce most of the things you want near where you are so that.

Revolution so I think we have to study these trends very carefully.

And try to understand them and see where they go and figure.

Out how we manage them and then design a strategy for the United States in that light let me ask you about about that as you said you know part of strategy and deterrence is understanding your adversaries very.

The corner also your friend and also your friends exactly what makes them tick and I have a question.

On that for you as well but I want to start with this strategic approach to deterrence in the during the Cold War we spent an enormous amount of time and effort.

Studying the Soviets and yet in 1983 we came as close as we ever did to nuclear war.

In the abel archer exercise.

Where the russians in part were very much concerned with President Reagan’s rhetoric saw that exercise as a prelude to a pre-emptive.

Attack after that you helped convince.

President Reagan to open a dialogue with.

The Soviets did you feel that during the Cold War we understood the Soviets as well as we needed to understand them and do we now understand the Chinese the Russians Tehran or.

Pyongyang and what’s truly motivating them to craft.

The smartest strategies to deter them or to advance our interests let me go back to the Cold War part President Reagan understood the Soviets well and he understood that they could.

Change under the right circumstances there were lots.

Of people in our administration that didn’t agree with that so it’s a continuing battle.

Lots of people thought they wouldn’t change to taunt that it’s they’re here we’re here that’s life.

Get along he projected that they can change and then we had a moment when we deployed intermediate-range missiles particularly the ballistic missiles in Germany called the Pershing’s that was a huge thing that Russians walked out of negotiations of the Soviets and they fanned war talk but our allies held together and we deployed the missiles I call it a Pershing moment that was the turning point in the Cold War once we established our strength very clearly I might say force was not used no shots.

Were fired strength then it was possible to have good talks and gradually after the Pershing woman who began to have fruitful discussions and that was President Reagan’s thinking and that’s what he did do do you think that we have the the proper.

Understanding of China Russia John yang and Tehran to craft the most effective counter strategies to them well I’m not in the administration so I’m not privy to well how they’re thinking about things but I.

Think that Russia is playing a weak hand aggressively and we need a Pershing moment and once we have that probably we can have more fruitful talks but until they see that there’s a stop sign up there it’s hard to have they just will continue what they’re doing so we have to have that Pershing moment and then I.

Think we should be able to have some fruitful talks and that would be very important to do would that be the same with the Chinese as well with their island building well the island building is part of the problem but the Chinese least I know I know from my own personal experience how willing they are to talk.

And to solve problems and there there are plenty of difficulty to know but the president of China has an instinct to talk let me give you two examples I was in China and attractive meeting.

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