17/05/2012 Newsnight

Is the world preparing for a Greek exit, pursued by a bear market? In

Athens the rain is flooding in, the money is flooding out. Tonight an

agency lowers Greece's credit rating even further.

Here in the birth place of democracy, more and more people are

rejecting mainstream democratic parties. I will be finding out what

that tells us about Greek society. The G8, the big industrial powers

are about to meet in America, all say they want a solution to the

euro crisis, but can any of them actually produce an answer?

Should this controversial trial of GM wheat in Hertfordshire go ahead,

or be torn up. For the first time we bring

together scientists and GM opponents to debate whether this

plea should be heeded. We know we cannot stop you taking the action

you are planning to take, but please reconsider, before it is too

late, and before several years worth of work, to which we have

been devoting our lives, will be destroyed forever.

And just when you thought it was safe to go back into the financial

waters, the losses incurred by the trader nicknamed the London Whale,

are mounting out. We will ask Nassim Nicholas Taleb,

why these events seem to keep taking us by surprise.

Good evening, today one journalist wrote that the Greek crisis was

reducing our leaders to the figure in Edvard Munch's Scream, howling

in despair, with little ability to affect events. As the most powerful

people on our planet make their way to America for tomorrow's G8, the

eyes of the world rest on an election in a small country whose

results may affect all our tomorrows.

First we report from Athens. Handing over the Olympic Flame for

Princess Anne. It is a torch of unity and peace, but the Olympic

Flame was entrusted to its latest temporary keepers today. By a

nation that itself is deeply divided, on the edge, some fear, of

more social strive. Everyone knows Greece is the birth place of some

of Europe's most cherished values, including the idea of

representative Government. Why then, here of all places, are so many

people now rejecting mainstream politics, even questioning the

democratic system. Is it simply a protest at falling living standards,

or does it tell us something more fundamental about Greece itself.

Among the newly-elected MPs sworn in today, were members of extreme

right-wing party, Golden Dawn, regarded by many as Neo-Nazis. They

are entering parliament for the first time, with 7% of the vote.

Today, gay activists were marking the international day of action

against homophobia, in an Athens bookshop. They are worried that

discrimination, and even violence against minorities of all kinds may

now increase. We fear a rise of the far right, especially now that we

are having a far right party within parliament. The gay community is

afraid about the challenges these people will impose on the

legislative protection of the rights of gay people, especially

the gay youth. We have come to think of ancient

Greece as a stronghold of enlightenment. But attitudes here

are as complex as the country's multilayered history. A society so

confident and outward looking in antiquity, was forced to turn in on

itself during the long centuries of otman ox passion, that ended only

in the 19th century. Greece was liberated partly by its own

patriots, but only by the help of foreign powers. Greece has always

depended on the kindness, or lack of it, of strangers. That has made

the Greeks susceptible to humiliation, that has occurred and

recurred in Greece's history on many occasions. Nevertheless, I

would say that Greek political leaders and politicians, in general,

were made of very good stuff. That's what saved Greece from many

a difficult decision in the past. Not so today. Today our politicians

are not up to it. That's perhaps why, in a city district of Athens,

they voted against the main parties, accusing them of caving into the

European Union over the bail out terms. This is a stronghold of the

radical left. Inside the district, these graphic designers have left

their jobs in the mainstream media, and set up an independent co-

operative, it is one of many ventures across Greece, designed to

create alternative economic and social networks, forming islands of

freedom, as they put it, outside the despised state. Their aim,

above all, is to help those impoverished by the crisis.

Everybody gets together and brings food and cooks together, for a

minimum, a small price, or most of the time for free. But there can be

entertainment, like through free cinemas, or theatrical plays. So

people need real solutions to their every-day problems. That comes

through collectives or through self-organised projects. They are

growing and spreading all over Greece, like a virus in a way.

The rot in the system set in soon after the collapse of the military

junta, that ruled Greece for seven years up to 1974. The hopes that

came with the return of democracy, couldn't all be fulfilled. The man

who dominated Greek politics in the 1980s, the socialist, Lucas

Papademos, delighted many -- Papandreaou, delighted by railing

against America and others. undercurrent of somebody is out to

get you, the conspiracy theory, the friend-foe division, has been

fighting the fires of Golden Dawn, Syriza and the far left. It is the

frame of mind, the way of thinking that our ills are not our own, and

brought upon us by others. Long before the flame reaches London,

after its journey around Britain, Greece will have yet another

parliament. But few expect it will be one that can restore the Greek's

confidence in their political system.

We can join Tim now. Give us a sense of what it feels like there

tonight what are people preparing for in the next couple of days?

are preparing for the new elections on June 17th. The opinion polls

certainly suggest that the left- wing grouping, Syriza, the party

grouping that rejects the terms of Greece's pail out, will do even

better in these coming elections. Although, some people think

actually the polls may change, the final vote will be different, and

perhaps Greeks, if you like, will draw back from the brink and return,

perhaps, out of fear of the consequences, to the mainstream

party. While we are in this limbo, we have further news of the

developing liquidity crisis here. What we have heard today is now

Greek patients in pharmacies will have to pay for the first time up

front for their medicines, that is because of the enormous arrears,

the enormous amounts of money that pharmacies are owed and haven't

been paid by the state-backed health insurer.

World leaders are heading to America for a G8 meeting tomorrow.

Here is our diplomatic editor. Fresh fears you assume of contagion

tonight? Absolutely. Some strong elements of deJay have you last

night over Greece. FITCH has downgraded Greece to triple C, and

France was worried about losing triple-A. People are talking about

a slow motion run on the banks in some parts of Spain. I don't know

if that is some talk. There is disagreement over how tough we

should be with Greece, on whether the package put forward by Nicolas

Sarkozy and Angela Merkel last year, should be stuck to. Or whether the

new formula of Francois Hollande, more of a growth-based approach

should be adopted. How are the key eurozone leaders reacting then, we

see it as Germany versus the rest of southern Europe? Increasingly it

is looking like Germany versus almost everybody. Strong hints

being given out today by Downing Street that David Cameron also

favours a solution of looking more at growth, of trying to help Greece.

In that sense he could make a very favourable first impression with

Monsieur Hollande tomorrow in America, as a possible ally. They

have a huge number of things to talk about. The really key issue

that still divides people in the EU, is the funding of the called

firewall, or the big bazuka, the funds that could be needed to

protect the banks, and where exactly the money is coming from

growth. Some suggestion that is there could be compromises over

structural funds, and structural redevelopment, Hollande says the

European bank should issue its own bond, and Britain has said things

in the past. The gerplgs are adamant they don't want to do that,

because they will end up paying for it. We talk about the eyes of the

world, is America immune to this, we are looking ahead to the G8 at

Camp David? They are absolutely not immune from it. There seem to go

signals that President Obama may be joining that gang in putting

pressure on Angela Merkel. Because he too is worried that if things go

wrong over the next few weeks with a possible Greek exit, that could

impact the US economy, carrying them back to a double-dip, while

many of the economic indicators at the moment are OK. And the

Europeans are heading over to reassure him that they will come up

with something. There is a very important meeting in Europe next

week. Meanwhile, we have a message of reassurance from the President

of the European council. I believe that in spite of all the

difficulties, and we are not complicit in had the challenges, we

are on the right track. I bring you a message of confidence. We are

doing a root and rang reform. have Mario Baldassarri, an Italian

senator who sits on the budget committee, David McWilliams, an

Irish economist, our guest from Skype, and Chrystia Freeland from

the USA will be joining us a little later.

David McWilliams, if I can start with you, we know Ireland has taken

the bitter pill, how do people there see the drama in Athens?

look Atkinson thens, people are nervous -- at Athens, people are

nervous and see it moving towards an end game in Athens. We also

realise, having gone through four years of this ourselves, that the

three big issues aren't solved, there is too much debt, no growth

and no political leadership. As a consequence of that, and

particularly the legacy of debt, the economies continue to weaken.

We in Ireland can understand exactly what is going on in Greece,

not least because we are clearly not in a situation quite as bad as

Greece, but in a broadly similar situation when people have too much

debt, they don't want to spend. When the banks, as you heard from

your correspondents have too much bad debt, they don't have the

ability to lend. And consequently, imposing austerity on a country

where the people don't want to borrow, and the banks don't want to

lend, is almost like putting an anorexic on the diet, and expecting

that person to put on weight and get stronger. Ultimately from the

Irish perspective, we have seen the legacy of debt, and the fact there

is no political leadership, leading to the growth rate falling, this

increasing the level of unemployment, and increasing the

agitation of people. Let me ask, with your anorexic on a tkwriet, do

you see that as a -- diet, do you see that as a fiscal referendum on

the pact, will you say no to that? Many Irish people will looking at

what is happening in Greece and Spain at the moment. They realise

that the game is in play. In that sense, as your correspondent was

saying, Germany has to shift. We are moving towards probably a grand

bargain in Europe. Therefore, the fiscal treaty in Ireland may well

be seen by many Irish people as an opportunity to express our

dissatisfaction, which is what is going on. This has changed over the

last couple of days really. Because of what's happening in Greece, and

because of what's happening in Spain. Briefly you think there will

be a no-vote there? I think the polls will narrow very dramatically

over the course of the next ten days. Interesting to watch that.

Let's go to Spain and pick up the story there. There was a rumour of

a run on a major bank there. Do you think your own Government can bail

out the banking system? I don't think it can, I don't think it can

find the funds needed to bail out the entire banking system, in Spain

we have a two-tier banking system, there are solvent banks, large

institution, and we have what is left over, left behind from the old

system, being transformed into banks, while this is happening they

still have governance problems, and we have these big, big problems

with Bankia, whose balance sheet is about 38% of Spanish GDP.

Essentially it is worth nothing. That was the bank that was not

really run, but which was having a large flee of deposits. A lot of

people, frankly, are saying Spain is next in line. How big a bail out

do you think you would need? know the way we see it from here

today, at this point in time, May 17th, it is not that we need a 50%

of GDP bail out like the ones that have been served for Greece and

Ireland and Portugal, but it is rather something more to the tune

of maybe 50 billion euros, to bail out the banking sector, the damaged

part of the Spanish banking sector. I don't think right now anybody in

Spain is thinking a major bail out with a major intervention from the

IMF, the ECB and the European group institutions. Mario Baldassarri,

the Italians, Italy would love to see Germany bail out Greece, right?

Well, you know, the key point is that we are playing some kind of

sado-masochistic end game since the beginning of the Greek crisis. The

key point is we have to cheer up what we are talking about. We are

facing a crisis of a small country, 11 million inhabitants, over 320

million Europeans. It is like a crisis in a council asking to go

with the dollars and the United States and the Federal Reserve. We

don't yet have the United States of Europe. And actually we need to

behave as we would have already have the United States of Europe.

Which is asking French for financial equilibrium, but giving

them some kind of Marshall Plan to readjust not in ten months, but ten

years. This should be a United States of Europe. This is something

that Germany has to understand. think that Germany has been unfair

on Greece so far? Well, the point is this, two years ago, if you had

given Greece 40 billion euros support, and then ask it the day

after, asking Greece to take under controlled administration the

accountant with Greece, with 40 million euros two years ago, the

situation could be faced at that time. Now it might be that it will

cost 150 billion euro, and maybe Greece will go out of the euro.

point is it is very politically sensitive, you listen to Ireland,

to Spain, to Italy, if you were a German taxpayer now, you would be

saying why is this burden just falling on us? Because it would be

a disaster for Germany. Germany cannot behave a single country,

without facing the globalisation. Europe needs to have the United

States of Europe. Germany may lead this process, but take the

responsibility, not only to save Greece, Spain or Italy, whatever.

But to save the future of Germany. Can you say, David McWilliams why

the Germans would feel they have got shafted, they got a pretty bad

deal here? You have to look at it from the German point of view. The

German point of view realises there is three reasons they want the euro

to stay in place. The first is, they do a huge amount of trade, the

lion's share of their trades with the rest of the eurozone. This

gives them stability. The second idea, a new damp mark, if it came

around, would dram -- Deutschmark, if it if it came around would

dramatically decrease trade. The Germans like all the capital

leaving the periphery, Italy, Spain and Ireland, is going to Germany.

They are getting a free lunch in terms of their own interest rates,

they are falling dramatically. They have three big reasons to stay in.

The way I see it, it always seems that Germany is a bit like a very,

very good, house proud neighbour n a bad estate, in a bad

neighbourhood. Increasingly what is happening is the neighbours are

behaving more delinquently, than the Germans need to deal W they

need to the fix the thing. Therefore, they have a price. The

price is, what price is Germany willing to pay for their neighbours

to clean up their act. That is really where we are going right now.

Chrystia Freeland is nodding as you speak. I want a US perspective. It

was interesting to hear from Mark, that Obama is also pushing for more

support from Angela Merkel. Why does America have to care, it's on

the road to recovery now isn't it? Traditionally America doesn't care

that much about Europe, particularly this year with an

election season. Europe has been pretty far off the political and

economic agenda. But, with the crisis intensifing in Europe, a lot

of people, particularly in the White House, close to the President,

are really starting to worry that what happens in Athens and Berlin,

could play a bigger role in deciding the US election in

November, than anything that happens in the United States. So

Barack Obama in particular, is desperate for Angela Merkel to fix

this. So the suggestion is the other side would be quite happy to

see everything going belly-up? think no political leader will ever

say he wishes ill on the world, but certainly, I think it is true that

if the global economy gets a lot weaker, and with it the US recovery

gets knocked off worse, that certainly is good for Vladimir

Romanov and bad for Barack Obama. The -- Mitt Romney, and bad for

Barack Obama. The other interesting thing is playing into the American

debate, is whether you should be focusing on austerity and cutting

budgets, or stimuli. Both sides claim Europe as vindication of

their views. We are running out of time.? In a couple of words, will

Greece stay in Europe? I think not. Mario Baldassarri? I hope question

-- yes, because the alternative would be very costly for everybody,

including the United States. David McWilliams where do you sit on

this? I don't think the Greek also stay in the euro, I don't think

they can possibly do that, their economy is too weak, they will move

in the next few weeks away from the euro. That is what the politics are

telling us. Javier Diaz Gimenez? I'm hoping the Greeks will find a

way to keep the euro-area together. Thank you for joining us. Could

destroying a field of plants be the same as burning books. That is what

scientists are claiming in the face of action by protestors being

threatened in ten days time in Hertfordshire. Scientists there

admit they can't prevent the plants being destroyed, but are pleading

for it to continue. We have the head of the project and a leading

activist Take The Flower scam back -- Back.

This is GM wheat, the first of its kind in the world. It is being

modified to repel aphid pest, which cost farmers millions in lost yield

and damage to crops. Researchers want to test it in open air, the

opponents say the trial is a risk, some plan to destroy it. Prompting

an unusual YouTube plea from the team that created it. We know we

cannot stop you taking the action you are planning to take, but

please reconsider, before it is too late, and before several years

worth of work, to which we have been devoting our lives, will be

destroyed forever. We appeal to you as

environmentalists...Toby Bruce is one of the researchers. The wheat

has an added gene, that makes it release a chemical signal, similar

to one aphids produce naturally, to alert one another to danger.

idea of these plants is to rebel the aphids, but attract their

natural enemies. In this demo, if a drob of the alarm signal is dropped

here the aphid, they crawl away, at quite a pace. With what are

spectacular lab results, the next test is to see if the modified

wheat works outside. The head of their serial transformation lab

told us they are having to take extraordinary measures. The fence

is there for two reasons, to protect the trial from foxes and

rabbits that might want to eat the plants. But also to prevent access

to unauthorised humans. That includes the protestors, they have

installed CCTV, and an infrared beam around the edge of the field.

It is not easy to get close to these plants. But security is

expensive. A quarter of the project's total cost, so far.

Opponents say the work should stay in the lab, because out in the open

there is a risk that GM pollen will travel beyond the test field. But

the scientist say the risk of that happening is tiny. Wheat is self-

pollinated. It is not pollinated by wind or insects, excess pollen will

fall to the ground, it is heavy and has a short life span. Once outside

the flower it will last an hour or less. The experimental plants sit

inside a buffer zone, designed to lower the risk of any GM pollen

escaping. Peter is a conventional farmer in Lincolnshire, and a vocal

critic of this trial. He grows wheat and rears gloser All Spot pig

-- Gloucester All Spot Pigs, he questions why the scientists are

testing a wheat that is rarely grown in the UK. Spring wheat, a

variety used for the trial, is only 1% of the UK wheat crop. This is

winter wheat, that is the 99% we depend on to feed the animals and

the people. The test may moven to winter wheat, but Peter is not

convinced this is something he needs at all. If aphids become a

problem in spring wheat, and they don't always. I have access to

selective insecticide that is are reasonably safe to use with bees

and ladybirds and others, and only cost �2 an acre. He wouldn't go so

far as destroying the GM wheat, but is he concerned that such crops

pose a threat to farmers' livelihoods. In America a small

trial in rice ended up contaminating the whole United

States rice harvest. There is potential for enormous damage.

incident with GM rice, not an isolated example of contamination,

prompted temporary bans in 2006 in Japan and Russia, on rice imports

from the US. After trace amounts of a non-authorised GM rice was found

in commercial supplies. Protestors objected to research

trials, partly because of that leakiness in the food chain, when

GM crops was first planted out in the UK some ten years ago. They saw

this as a technology being forced on consumers, who didn't want it,

and which put multinatural co- operations in charge, not farmers.

Europe entered a decade of stalemate over GM agriculture.

Elsewhere the planting of GM crops has increased steadily. The latest

figures from the industry indicate that some 160 million hectares of

GM crops, such as soya bean and maize was grown across the globe.

The top growers were the US, Canada, India, China, China growing four

million hectares, little was grown in the African continent, apart

from three million hectares, Europe is banging back, with one million

of hectares grown last year. Many scientists take the view that since

such a volume of GM crops has now been grown, and eaten around the

world, any serious problem would be apparent by now. Where the harm to

human health, or widespread impact on the environment.

The National Farmers' Union says we will need every tool in our tool

box to meet future food demands, including GM crops, that can cope

in dry conditions, need fewer pesticides, or offer nutritional

benefits. We see a lot of it as being public good. One of the

things we can do is offer something that maybe industry would never

come up with, the reduction of the use of chemicals. We need to prime

the pump with new ideas to give alternatives. First of all, it is

giving choice in the overall system, so that we can actually do some

public good, by reducing pesticide use. I think the general public are

certainly interested in that. But campaigners argue there has not

yet been the systematic data collection, to be certain of the

effects of GM. We're not saying stop doing research on GM, but we

won't be in the lab until we fully understand how genes work, how they

relate to the environment and each other, and what makes them tick. We

don't know all that yet, and we shouldn't introduce things into the

environment and food chain until we have a pretty good understanding of

it. Way beyond what we have at the moment.

Some campaigners say there is a third way. Scientists have decoded

entire genetic maps for staple crops. Here you see a model of the

way rice genes interact. This means they can select plants that carry

desirable genetic traits, and breed from those, rather than adding in

extra genes. Meanwhile the scientists concede they don't have

all the answers, which is why they want to conduct the GM experiment,

the protestors argue that the trial represents a threat to British

farming. And if the scientists won't stop it, they say, they will.

Here in what is a completely GM- free studio, our guests are with us.

It is great to have you all here. Thank you for coming in.

We heard from a speaker who said he certainly didn't want to stop the

research, even though he was against GM. Are you going to let

this trial go ahead? I certainly believe in the power of non-violent

direct action, in illustrating something that is a really

important principle, that is this is the sort of science we don't

want progress to move in the direction of, because it is really

dangerous. I appeal very strong -- I feel very strongly it is

important to look at the wider cultural and social implications of

GM ago tulure, I think it is a very dangerous stamp of validity when

you look at the trial. Would you stop it, you will uproot the plant?

I will stop it. I would like to decide on the day if it is a valid

action. I believe it is important to state you will do that sort of

thing, in order to get on Newsnight and talk about it, and say can we

enter into a debate about this. People have been writing lots of

letters, people have been entering into consultations, all the GM

protestors have been saying for over a decade, we don't want

Government research to be focused on GM technology when there are

other things available. We need direct action to stop that. We have

a mandate by achieving the research grant for doing this work. It is

top science, and it is in the direction of producing food in a

more sustainable way. We are using GM only experimentally at the

moment, it is not going into the food chain. It is not part of a

commercial development. What do you mean by sustainability. What I mean

by sustainability, is if you can deliver crop protection through the

seed F you can have in the plant its own way of dealing with pests,

then you don't need to drive a tractor over the crop with a spray

on it, and the carbon footprint. There is holistic ecosystem

management. As you know, we work in Africa in just that way, because,

in fact, there, people are not buying fertilisers, and not buying

seed, so you can't deliver it in that way. We use companion cropping,

as you may in organic farming. me ask you something, you said this

was purely for science. But you said in the past that companies are

keeping a watching brief, and you are wined and dined heavily by

academic groups in the UK. There is money to be made for you out of

this? Not for us, we do our work to get grants for research, elite

research, which we get during the process of competitive tendering,

as it were, with due regard to our peers and what they consider it.

There is no way this is science for science sake? No, I said it was in

the direction of sustainability. I have explained why it is leading to

a sustainable approach to agriculture. In your terms, in your

terms, we have other terms of sustainability. If you want to go

out and companion plant, in a wheat crop in Britain, you will have to

put a lot more labour in. I'm a full-time farmer, I know farmers

all around me who do companion planting, they plant banks of wild

flowers along the edges of the field, and mounds for wild flowers,

they do it here. I'm going to bring in Lawrence, you have spoken and

thought a lot about organic farming, this, in a way, sounds like it is

the grown-up version, the green version of GM, a decade on, isn't

it? Not at all. My background is organic farming, I'm involved now

with a group of citizens concerned about GM, not necessarily opposed

to GM, but concerned about GM. Our concerns about this trial. First of

all, we don't believe it is necessary secondly, we don't

believe that the process of -- necessary, secondly, we don't

believe the vetting process has been adequate. And thirdly, if we

are talking about grown-up ecology, this group and other research

groups, reported 2005, a three-year trial, a million pound of tax-

payers' money spent, looking at ecological actions, dealing with

aphids, without as youing GM and chemicals, looking at the farming

systems, the hedgerows, the surround of the fields, this hasn't

been taken into account in the trial. Are you saying, stop that

science now, we have had enough? I'm saying this trial is

unnecessary, on a crop that really doesn't suffer from aphid problems.

You don't like this kind of science at all, right? As was said in the

film, I think the GM research really needs to be done in

controlled environments, when you take it out into the field, it

raises bigger problems, bigger risks, and those need to be

assessed properly. Our regulatory system doesn't do. That we need a

question about need. We need to be clear here that we are talking

about a controlled environment. In a sense this research is going on

in a experimental setting. It is not a controlled environment.

let her speak. The thing they are looking for researchers to find out,

are the very answers to the questions that you are posing. If

we cut off that research lion, we aren't going to answer it. It is

foolish, I agree...Does It matter that the public has consistently

shown itself to be against this kind of testing? I think there is a

change in climate at the moment. We are getting a tremendous amount of

support. I'm very sad that some people are not supporting us, I'm

very keen to engage in further dialogue on this, to explain our

point of view. We are certainly looking at an experiment, we have

chosen wheat, because it is our most important crop, and aphids are

the most important pests on it. We can work on winter wheat, as you

know we have it in cond, -- condenza. Aphids are not a problem

in winter wheat. Last year we had a big problem in aphids in spring-

sown wheat. Our out of the last six sea ons there is no aphid problems

in the UK. Four out of the last six seasons. Aphid transmit a virus to

wheat, that is transmitted by aphids in the autumn. That becomes

a problem because of early drilling, you can deal with that problem.

Let's step back, because the point of the winter and the summer, is

that summer wheat tends to be a crop that is grown more in the USA.

It is something that they use more, which suggests that what you are

planning long-term. There is no conspiracy here, we are very keen

to see how this kind of approach works. Winter wheat would be a very

nice model, it would be a lot more expensive to be the experiments

initially on it. We are doinging it in spring-sown wheat, in a variety

that can be grown as a winter wheat. If you are looking at this properly,

and talking about serious ecological interactions to deal

with aphids, this trial should look more at the margins of the field,

the hedgerows. What gives you, wait a second, what gives you the right

to say this kind of trial, this kind of science should not go

ahead? Because I have a lot of experience and I feel very

passionately about it. I'm a farmer myself. My family has a farm in

Iowa, and I have directly seen the impact of GM agriculture, and the

intensive affect on our family farm in Iowa. It is very much about the

land in one sense, and now farmers are being pushed and pushed and

pushed to cultivate huge margins, and go to the edge of the fields to

get the maximum amount about fields. You are making moral decisions the

whole time? We can sit and "cherrypick" all kind of stories,

there are mixed stories. Just let Tracey talk? Which is is actually

why it is that it would be much more valuable for you guys to be

involved in a debate, rather than come in and rip up the experiment.

There is an awful lot of information. You don't seem to be

wanting to go on the debate with us, we have offered a debate on Tuesday.

We would like a more thorough debate. We think the debate should

precede you destroying the experiment, if that is what you are

doing. If we didn't threaten it, you wouldn't have asked us.

least see the results of the debate before attacking the crop. That

sounds positive, it soupbtdz like you won't go ahead with ripping up

the crop, but would rather debate. I'm not going in either direction.

Do you think it will succeed? think there are many problems with

doing experiments in the field. We have to do the experiment, we have

done a lot of work in the lab. Experiments don't work the first

time. We have to see how it stands up to the rigours of the outside he

can kolg. I think it would be a very good -- Ecology. Farmers have

beenest iting this sort of thing for centuries, they have been work

-- this sort of thing for -- testing this sort of thing for

centuries. What do you make of the National Farmers' Union who say we

have to use every tool in the tool box to fight growth in population

and starvation, they don't count, the National Farmers' Union don't

count? They are working on a lower level. You have to look in the

farming press, many conventional farmers have come out and said this

trial is irrelevant. We had one farmer on the video earlier. This

trial is irrelevant, this work is irrelevant. This is not true.

asked whether people are for origins, I think we need to stop

asking people that question. What GM does is opens up a very exciting

and interesting area of research, that may provide answers to some of

the most pressing questions. We can't blank it. Has your mind been

change bid this discussion? I would like to discuss it further, and I

would like to encourage you to look at the wider social implications.

We have done, and we will discuss it with you as much as you like.

Thank you very much indeed. If you understand the complexties

of how the trader they call the London Whale, lost his bank JP

motoring began three billion dollars and counting, you are doing

better than us. Has the world got wiser with the risks and rewards

that dominate highens if, or are we still in danger of the -- dom

dominate, are we still in danger. The portfolio has proved to be more

risky and volatile to the economic edge than we thought.

Today JP Morgan admitted their losses amount to at least $3

billion and could be more. They were caused by the trader, Bruno

Iksil, who earned the Monday Kerr "the London Whale," because of the

size of the transactions he did. Ina Drew quit the bank this week as

it fought to contain the losses. It is hardly the first financial

scandal to hit the markets. Earlier this year there was a collapse of

MF Global, after billions of pounds of disastrous bets went wrong.

There have been sweeping changes to bank regular gaigs, but critics

argue big bonuses, big risks and big losses seem as common as ever.

Nassim Nicholas Taleb, Professor of Risk and Engineering and author of

The Black Swan is in New York and talking to us this evening. It

feels time and time again we have seen this happen. Why do the banks

let it happen, do they not know about it, turn their back on it or

do they not understand it? I think all three. Primarily I think

incompetence, they don't seem to know what they are talking about

when talking about risk. We have known since 1998 that two of the

tools used to manage risk don't work. We have had the tragedy of

LTCM, Long-term Capital Management, a firm that got the wrong name,

that went bust relying on these tools. We kept using the same

methods. In 2007 we discovered these methods of risk don't work,

they were relying on the risk metrics. So it is nonsense, they

are using the wrong tool, it is part of a system, it would happen

else where building bridges, and telling us these bridges can landle

500 trucks and they break at the third truck. Visibly we are -- can

handle 500 trucks and they break at the third truck. Visibly we are

using tax-payers' money as a back stop. They don't want to learn.

I want to get on to that in a second, that is key. Looking at

this example, it is a very complicated derivative system, but

broadly, this man, the London Whale, was trying to balance the risks. He

was trying to make it impossible to lose. Why would that go wrong?

Number one, it is based on a big illusion, the fact that we

understand the risk of rare events. It is a business they shouldn't be

in, it is too complicated for them. We have known the business is too

complicated for Wall Street, for the banks, or all banks, we have

known it is very complicated. They should get out of that business. JP

Morgan should concentrate on lending money to farmers, or

whatever, car loans, that is the business they should be in. They

shouldn't be using my money to play in a way that is too dangerous and

complicated for them. JP Morgan has ten-times the risk of the original

hedge fund. Do you say they should be more regulated or they should be

allowed to go bust when it goes wrong? Both of them. When the event

happens, I'm against you know nationalisation, and I'm against

centralised Government. I'm against regulation. I was a derivatives

trader for 20 years, and it gained regulation. I wanted a following, a

skin in the game, people who make money, if they have the upside,

they should get a bonus, and people should be down with the down side.

Hedge funds had that. The risks that are pure risk, gambling, if

you like, these risks should be borne by hedge funds with up sides

and down sides. Banks, if we are bailing them out, they are ustill

fees, why not treat them -- utilities, why are you treating

them like utilities. You know you will never convince the banks to

leave that side of stuff alone. If it didn't happen as a result of

Liam mans, it is never going to happen --ly mans, it is never going

-- Lehmans, it is never going to happen? There is a saying, you will

never convince a general that the war isn't happening. You can never

ask an industry, you have to force it on them. We should never have

bailed out the banks so easily in 2008 without explaining them, de

facto, you are civil servants. If you are bailing them out, they are

civil servants. They went to pay themselves the highest level of

bonuses in 2010, it is an insult to our intelligence ,ing these metrics

is an insult to our intelligence. Do you think the banks should not

have been failed out at all at that point, knowing what you know about

the way banks operate and behave? Two things should have been done,

the first thing is, we didn't bail out Lehmans, we saw the effect,

then came Citibank, we should have then bailed out Citibank on the

very stiff condition, explaining them that you know, you are de

facto, we don't want to nationalise you. But de facto, you are owned by

the taxpayer, you are no longer a free entity. I don't mind risks

being taken. You are an idealist? I'm not. I'm not an idealist, I'm

someone who doesn't want to be paying $14 million for this lady,

Ina Drew, more than the Mafia, I don't want to keep paying her that

money for taking risks. Could you convince a politician into saying

that? Politicians, visibly, don't have the courage to face lobbies.

But the public is convinced that they don't have the information.

Thank you very much. That's all from Newsnight tonight. This summer

Donna Summer died in Florida. She was called the Queen of Disco by

some, and just to get you in the right mood for bed. We will leave

you with one of her biggest hits. # Oh I feel love

# I feel love # I feel lovele