Perspectives both global and local: A discussion with Ernesto Zedillo

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As director of the Yale Center for the Study of Globalization, Ernesto Zedillo has spoken around the world on issues related to trade, finance, and the alleviation of world poverty.

Ernesto Zedillo ’81 Ph.D., the former president of Mexico, is the Frederick Iseman ‘74 Director of the Yale Center for the Study of Globalization, which he has led since 2002. A noted economist and a leading voice on globalization, especially its impact on relations between developed and developing nations, he has been an influential spokesperson on issues related to trade, finance, and the alleviation of world poverty.

YaleNews recently caught up with him to discuss some of his recent travels and work, his insights about how Yale has developed over the last three decades, and more.

Back in May, you were the Distinguished Practitioner Lecturer at the University of Oxford’s Blavatnik School of Government. Your lecture title asked “Latin America: Taking Off or Still Falling Behind?” So, which way are things heading?

First I argued that relative to the messy condition of most Latin American economies in the 1980s and well into the 1990s, there has been dramatic improvement. This allowed most countries in the region to show remarkable endurance during the worst moments of the recent global financial crisis. This fact, along with a good run of economic growth over the last decade, had given a renewed sense of confidence about the region’s economic future. I warned, however, that there is a risk of complacency that could further delay the completion of the reform processes still pending, and these, in my view, are necessary to make the Latin American economies truly convergent with the levels of development achieved already by the advanced economies.

Interestingly, I expressed my concern about the situation in Brazil, which has benefitted enormously by the commodity boom brought about by Chinese demand, causing a reform lethargy that sooner or later would have very negative consequences. I said that on May 10. Little did I know that a few weeks later there would be massive demonstrations of people in Brazil expressing dissatisfaction with the delivery of government policies. I hope that these mobilizations stimulate the Brazilian political system to be more focused on the reforms necessary to achieve the higher economic growth that is indispensable to fulfill the Brazilian people’s demands and expectations. I also hope that the Brazilian situation stimulates other countries in the region to apply themselves more forcefully to retake the reform process.

You recently were in Jerusalem to receive an honorary doctorate from the Hebrew University there. Tell us about it.

Yes, I was very pleased to receive a Doctor Philosophiae Honoris Causa from Hebrew University, which I consider a great institution of higher learning, and to receive it along with other individuals (with much more merit than myself), not least our very own Nobel laureate, Sterling Professor Sidney Altman. Attending the commencement exercises was also a very exciting experience. Hebrew University is relatively small but the institution conferred 375 Ph.D. degrees, of which 205 were granted to women. I think this speaks volumes about Israel’s forward-looking spirit.

You also attended the Fifth Israeli Presidential Conference under the auspices of President Shimon Peres. What was discussed there?

First let me mention that this conference was also dedicated to celebrating President Peres’ 90th birthday. I was happy to join many others to pay tribute to a man whom I have long admired for his devoted work and leadership in so many important causes, not least his roles in founding the state of Israel and constructing its solid democracy and prosperous economy, his pursuit of peace in the Middle East, and his promotion of international and regional cooperation for development.

Ernesto Zedillo recently received an honorary doctorate from Hebrew University..
The conference itself was a very interesting one, for it covered topics ranging from the state of global geopolitics and the global economy to recent advances in basic and applied sciences, as well as various cultural topics. There was the benefit of important speeches by statesmen like President Bill Clinton, Prime Minster Tony Blair, and, of course, President Peres. I personally was a participant in a session titled “Is There Hope for a Green Tomorrow?” where, unfortunately, I had to convey a very pessimistic view on what the international community has been doing since the Rio conference of 1992 to match the challenge of climate change.

I expressed my dismay that, while the scientific consensus on climate change risk has been reaffirmed through more robust research, information, and modeling in recent years, at the same time there has been a marked weakening of the international commitment to seriously confront that problem. Inspired by the pioneering work of Yale’s Professor William Nordhaus, I insisted that the approach followed since the Kyoto Protocol agreement — that is based on the allocation, through negotiations, of national emissions caps of CO2, adding up to a global cap — is a geopolitical impossibility. That approach unnecessarily presents climate change mitigation as a zero-sum game; given the global cap consistent with limiting global warming to certain degrees Centigrade, a participant’s gain in emissions allocations must be balanced by the losses of emissions allocated to others. As posed, this problem may have a mathematical solution, but it does not have a geopolitical one.

Therefore I insisted that to produce an international agreement to deal effectively with climate change, governments must go back to the drawing board and negotiate on bases substantially different from those inherited from the Kyoto Protocol. One essential component, as proposed by Professor Nordhaus as well as other distinguished economists – conservative or progressive – is that all countries would agree to an international harmonized price on carbon that would increase over time.

How do you hope relations amongst Israel and its neighbors will look  20 years from now? And what key steps must be taken to get there?

I hope that sooner rather than later Israel, with universally recognized secure borders, will have good relationships with all countries in that part of the world. The principles to get there already exist, but the political conditions to apply them have still been elusive. Most people in Israel, in the Arab countries, and Iran want to live in peace. It is up to their political leaders, supported by the major powers, certainly the United States, to finally deliver such peace.

You were first at Yale in the 1970s, and have been back as director of the Yale Center for the Study of Globalization since September 2002. How has Yale changed and grown since you first came to know it?

In the 1970s Yale had long been one of the great universities of the world, and fortunately it has not lost any ground. The big difference is that it has become, based always on the immovable principle of academic merit, a university more open to the rest of the world. This is true in many respects. For example, during my time, foreign students admitted to Yale needed to come with scholarships provided by their governments, international foundations or their own resources. Now Yale College’s needs-blind admissions includes international students, who enjoy the same generous financial aid policy as those from the United States. Also there has been a very successful effort to make the academic activities more oriented to form global citizens. It is definitely a more cosmopolitan institution. Last but not least, among many other changes is the amazing renovation and extension of Yale’s infrastructure. I am very proud that a brilliant, although rather timid, young assistant professor of the Department of Economics when I was one of its students has been the architect of this transformation. I mean, of course, President Richard Levin.

And might you care to bring an international perspective to the eternal debate: What is the best pizza in town?

Actually my main weakness for a delicious bite when I was a graduate student was a tuna grinder from Yorkside Pizza and it is still the case. But I do like pizza and I get it at Café Bravo, although once I get there, which is very often, I fall prey to other delicious dishes offered by my friend John DiPaola.

Zedillo (right of center) poses with the other honorands at Hebrew University this year, who included Yale’s Nobel laureate Sidney Altman (third from the right).

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