>> The problem is the populism in the West, it succeeds when the center can't solve the problems.

And I always say to people, "Populism doesn't invent grievances.

By and large, it doesn't invent them; it exploits them."

♪♪ >> Hello and welcome to "GZERO World."

I'm Ian Bremmer, and today we're crossing the pond to take a deep look at the United Kingdom and how it's faring in the wake of some significant and very sudden changes, both in the government and in the monarchy.

They're still adjusting of course to the realities of Brexit and finding their new place in Europe and the world.

The United Kingdom is now facing inflation, a looming energy crunch, and more, with a new Prime Minister and a new King.

I'm talking with Tony Blair about the road ahead for his country.

And don't worry, I've also got your "Puppet Regime."

>> Britain's new King Charles isn't very popular, but people like his wife, Camilla the Queen Consort, even less.

>> But first a word from the folks who help us keep the lights on.

>> Major corporate funding provided by founding sponsor First Republic.

At First Republic, our clients come first.

Taking the time to listen helps us provide customized banking and wealth-management solutions.

More on our clients at firstrepublic.com.

Additional funding provided by... ...and by... >> British Prime Minister Winston Churchill once said, "To improve is to change.

To be perfect is to change often."

I'm not sure he'd feel quite the same way if he'd been around for the last few weeks.

Over 48 hours in early September, the United Kingdom got a new prime minister and a new monarch.

In fact, Queen Elizabeth's last official appearance was a meeting with Liz Truss, the third woman to hold Britain's highest office.

And then, sadly, her country's national anthem changes pronouns.

Liz Truss now runs the government.

King Charles III now reigns on the throne.

And a fairy tale ending?

Well, that's far from guaranteed for either of them.

Truss beat out a crowd of Tory competitors to replace scandal-plagued Boris Johnson.

But in the process, she now inherits a long list of domestic challenges and there are no easy fixes, like a cost of living crisis brought on by huge hikes in housing and energy prices.

In fact, inflation rates in the U.K. could top 18% by early next year as gas prices climb.

There's also ongoing fallout over Brexit.

Keep talking about that, the U.K.'s 2016 withdrawal from the European Union.

Among the many complications that Brexit brought -- and there are plenty -- intense debates over the Northern Ireland Protocol, a special agreement made to ensure trade would run smoothly between Northern Ireland, part of the U.K., and the Republic of Ireland, part of the EU.

Truss also faces a rattled public, still reeling from two years of the COVID pandemic, front-page political scandals you see every day, and workers on strikes from railways to postal routes.

And then of course there's still a war in Ukraine, wreaking havoc across the continent and the world.

So the keys to 10 Downing Street these days come with some complications, as does the crown of King Charles III.

The specter of Scottish independence continues to loom eight years after a historic referendum vote, and future ties to Commonwealth nations are becoming increasingly uncertain.

A look at the popularity of Queen Elizabeth versus King Charles begs the question, could the sun set on the monarchy itself?

From troubles within the United Kingdom to his nation's increasingly complicated place on the global stage, there's certainly no shortage of topics for today's conversation with Tony Blair, a man who occupied 10 Downing Street for a decade.

Here's my interview.

Prime Minister Tony Blair, welcome to "GZERO World."

>> Thank you, Ian.

>> So, so much to talk to you about right now.

We're both here in New York, we're talking to a lot of global leaders.

But I have to at least start, given the events of the past weeks in your country, after 70 years of Queen Elizabeth, and you knew her so well.

Tell us something personal, interesting, about your relationship with her.

>> Well, I grew up with the Queen.

And when I first met her as Prime Minister, she said to me, "You're my 10th Prime Minister.

The first one was Winston Churchill.

That was before you were born."

So I realized you were always talking with someone who had this vast historical experience.

She was very gracious and actually kind.

Very empathetic towards her Prime Ministers.

She knew the burden of responsibility you carried and she was conscious of that and always helpful.

I couldn't really tell you what her politics were.

She was always above the politics.

But she had this intense commitment to duty.

I mean, it really was her driving force.

And those characteristics of dignity, duty, decency, they defined her, and I think they gave her this power of example, if you like.

And she was just such a constant feature of British life, through all the changes.

I mean, if you go back to the 1950s, look at 1950s Britain.

Just go and watch the films of the coronation and just see the faces.

Then go fast-forward to Britain 2022 and the huge difference in social makeup, in class, in society, and the way we live, work, think, everything.

And she managed to guide the monarchy through all of that.

So she was a remarkable person.

We used to meet every week, obviously when I was Prime Minister, and then I was actually with her about three months ago.

We had lunch together when she bestowed this honor on me called the Knight of the Garter.

>> I remember that.

You have to dress up for that, really.

>> Well, it was instigated in 1340.

>> It seems like the outfits haven't changed very much.

>> No, that's right.

So if you want to see a really ridiculous picture of me, you can Google it and see that.

But she was grateful.

She was very reflective.

She had a -- It seems an odd thing to say about a monarch, but she was actually very streetwise.

She kept her pulse firmly on where the British people were.

>> In 2022, for some, the monarchy feels like an anachronism.

It is very different from the '50s, in lots of ways.

I mean, the Labor Party in Australia today is a Republican Party.

Do you feel like there have to be changes in the monarchy?

>> Well, I think King Charles, he will instigate certain changes, I think, probably.

Or so I read, I mean, I don't know.

But look, in the end, my generation, which was as it were the first generation that grew up in a society really that doesn't have the same deference, didn't have the same attachment to class as traditional British society.

We've come to our own settlement in our own minds of this issue, if you like, which is you can have an elected president or you can have a monarch.

And we prefer the tradition of the monarch, someone who's above politics.

It gives you a certain point of unity as a country, even if your politics is quite divided, which ours has been like yours in the past few years.

And so we've come to not a kind of... not an historical or a traditional decision to keep the monarchy.

We've come to what is a rational decision that we prefer it to the alternative system.

And so I think provided, and I'm sure this will happen with King Charles, by the way, because he's a decent and caring guy, I think if the monarchy keeps to this principle of duty to the country first, service to the country first, I think it's reasonably well supported in British society.

>> As a unifying factor for the country?

>> Yes, a unifying factor.

And Western politics is pretty ugly, and has been for several years.

But with the Queen's passing, I mean, even people I knew who were Republicans were moved by it and respected her and supported her.

And I think Prince Charles as he was then, was for example on issues like the environment, on better relationships between the face, was well ahead of his time.

The royal family, because of the Commonwealth and the number of African countries within the Commonwealth, they were very, very -- it's very ingrained in the monarchy, this head of the Commonwealth, the concept of that.

So, look, who knows?

But I think, for the moment, I would say the monarchy's pretty safe.

>> So we also have a new Prime Minister.

It's been a busy couple of weeks for the United Kingdom.

She comes into power not only with the transition of your monarch, but also with massive challenges on her plate.

I mean, just the scandals every day under Boris Johnson, difficulty in terms of preparing for the inflation, particularly on the energy side that we presently see, the continued knock-on effects of Brexit, which she initially voted against but now is a flag carrier for.

I mean, I know that she's not of your party, but you want her to succeed, of course.

I mean, how do you think she is -- it's almost too early to say how she's doing, but how do you feel about her priorities as she's so far addressed them?

>> I mean... you've got a short-term challenge, which is the energy price rise, because this is huge.

And then you've got a longer-term challenge.

On the short-term challenge, the energy, the rise in energy costs, it's just important to understand what this means in Britain and across Europe.

I mean, household bills will literally treble, right?

You're going to be talking about thousands of pounds more that people will be forced to pay.

So the government's going to have to intervene because frankly a large part of the population literally won't be able to pay it.

And also if you try and force them to pay it, you'll have a massive negative impact on the economy.

So you've got a short-term issue where government's going to have to subsidize effectively energy costs through this winter.

>> And the announcement that she's made on that front, the hundred billion pounds plus, was that the right approach?

>> Well, I mean, my institute put out a paper that was more targeted and with what would've been an incentive to use less energy.

I think the problem with just a blanket subsidy -- I can understand the reasons for it this winter -- but if this carries on, the problem over time is that you're not giving people an incentive to reduce their energy bills by reducing energy demand.

Okay, so...

But whatever way you want to cut this particular cake, it's going to cost a lot of money.

So that's the short term.

The long-term question that she's identified is the right question, which is around growth.

Because when I was Prime Minister we had growth rates well above 2% was the trend rate of growth.

We've been growing well under 2% and you've got to get the growth rates up because if you don't, one of the first things you realize in government is if growth's strong, revenues are strong.

If revenues are strong, you can spend money on public services.

If the growth rates are low or you're in recession, then suddenly everything looks worse and you're having to cut back on services.

So she's right to target growth.

Now, she's going for a particular way to do that, which is a lot of tax cuts and so on.

Personally, I think the big questions around growth long term for Britain are around the technology revolution, infrastructure, and education.

So whatever she's doing on tax cuts and so on, for me the big three things are really those, and it's too early to say whether she has plans for those or not.

>> You met with Ursula von der Leyen, among others, recently.

How is the U.K. perceived today by the European Union?

And I'm not just talking about its leadership, but generally speaking.

How is it changing over the last few years, since the Brexit referendum?

>> Well, I think there's a lot of frustration in Europe, in the sense that the European Union didn't want Britain to leave.

And people like Ursula von der Leyen are very Anglophile in their outlook, close links with the U.K.. And so they want to have a good relationship with Britain going forward.

Now, we've got to resolve this Northern Ireland Protocol, which is a Brexit hangover.

Because once you -- if take the United Kingdom as a whole, which means Britain, the island of Britain, and then Northern Ireland, if you take all of it out of the single market of the European Union, the external border of Europe becomes the border between north and south in Ireland.

And therefore in theory you should put border controls along that border.

>> Which is deeply unpopular.

>> Right.

>> And dysfunctional.

>> Exactly.

And conflicts with the Good Friday Agreement... ...a part of which was to keep the border open.

Okay.

So it's a problem which I think we could resolve practically.

And my institute again suggested ways we can do that.

We need to sort that out.

And then we need to look for how we build a more constructive relationship with our own continent.

And I think there's a willingness in the European side to do that.

And the only question is whether the very kind of anti-European politics of a part of the right in Britain get in the way of that.

And it would be tragic if it did because as I say to people, "You can change the political and legal relationship that Britain has with Europe.

What you can't do is change our geography."

You get from London to Paris quicker by train than you get from London to Scotland.

>> I want to ask you given what you've seen of the Prime Minister, the new Prime Minister, and given what you've seen of her cabinet, do you think that they will be able to avoid playing politics with the Ireland border?

>> I think and hope that they're sensible enough to just settle the Northern Ireland Protocol issue and move on.

I think they will.

I hope they will.

I mean, we'll see, but if you want a solution to it, there is a practical solution.

If it becomes an ideological fight with Britain effectively saying, "Europe's got to drop its single-market rules and so on to suit us," then the thing won't work.

But I feel there are some indications that the new Prime Minister will try and take a pragmatic view.

>> Now, you say that the Europeans of course didn't want the U.K. to leave the European Union.

Of course it's also true that a lot of Britons didn't want the U.K. to leave.

You were one of them.

>> Me?

Absolutely.

>> The Scots, of course, a large majority didn't want to leave.

Northern Ireland, of course, this is a huge challenge for them.

Does this make it more likely over time in your view that the United Kingdom ultimately disintegrates?

>> Well, I hope it doesn't, and I think it won't, but it obviously adds a dimension to the case of the people arguing for independence.

>> What's the biggest tension point that we need to watch going forward?

>> I think it's that if you're in Scotland and you really, especially with a younger generation, you want to be part of Europe and you see particularly a conservative government that you haven't voted for, because Scotland's not voting conservative, being anti-European, it's bound to fuel, and the nationalists are using this.

Now, I think the reasons for Scotland remaining tied to the United Kingdom -- economic reasons are massively powerful -- and I think in the end they'll outweigh anything else, in the end.

But it's given an extra dimension.

I'm as worried if not more worried about Northern Ireland because they're, again, a majority voted to stay in the European Union.

Northern Ireland will in effect remain to some degree a part of that single market in Europe.

And for the first time, very recently, the numbers of Catholics have outweighed the numbers of Protestants in Northern Ireland.

Now, not everyone votes on that basis, but there are tensions.

So I think and hope that the U.K. stays together, but there's no doubt Brexit has given an impetus to the people arguing for either a united Ireland or Scottish independence.

>> Is there any recognition among the Brexiteers, given what has happened, the trajectory of the U.K. economy, the tensions, the fact that the U.S.-U.K. trade deal for the time being is not in the cards, that actually they were selling a bill of goods?

Do you get any of that?

>> Not a lot.

I mean, it's, look -- >> Because you do have a new passport color, for example, I mean, I know that's a big deal.

>> Yeah.

I mean, no, look, we were told there'll be more money for the National Health Service.

There's obviously not because growth rates are down and therefore revenues are down.

And we've spent in any event billions of pounds on new border checks and all the rest of it.

We were told there will be an easy U.K.-U.S. trade deal.

Not merely is it not easy, it's not even under discussion.

We were told that it was nonsense to suggest that Northern Ireland was going to become a problem, when it was obviously going to become a problem if we did Brexit in the way that was being described.

But, look, I mean, those of us who were passionately against Brexit, we've got to accept the argument -- the argument's over, and what you're going to look at now is how you fix the Brexit problems and move on, is what I would say.

>> When you were Prime Minister, the world and governance and democracy looked very different, in many ways more stable than it does today.

If you were Prime Minister today, if you were a leader on the global stage, what would you do differently as a consequence of that now than back in the days of Cool Britannia?

>> So, I would be doing two things, because I think, for me it's all about the West being strong, able to defend its values and its interests in an era where the geo-policies of the 21st century are going to change dramatically because of China.

So my view is, number one, the West has got to be a strong alliance, and if there is any benefit coming out of the ghastly events in Ukraine it is that that alliance has strengthened and that means America and Europe and then our allies around the world, including in the Pacific, we stick together, we stay together, and we're more effective together because the second thing I would say is the biggest challenge to democracy is efficacy.

When you follow a lot of the media debates, it's all about transparency or accountability.

It's not.

It's about effectiveness.

And this is where I come to the second thing, which is in my view, the big real world event is this technology revolution.

And if you 're looking at healthcare today or education today or how people are going to work, how government functions, it's all about understanding that revolution.

And it's transformative potential.

And what the West needs is not just a strong foreign policy.

It needs a strong domestic mission, right?

And that should be about this technology revolution and how you harness it.

But to do that, the West politics have got to return to a strong center, because that's what we had when I was in office.

And the center, not as the split between left and right, which I think is a 20th century -- left-right politics is so 20th century.

The real issues today are really practical, not ideological, but the center should be the place where you make the changes that match the scale of the challenge.

>> So I'm telling you, if you were campaigning, I kind of feel 21st century Third Way is what you're talking about.

>> Yeah, but this is correct, in the end.

I mean, this is what I often say to people in the Labour Party when they say to me, "Oh, no, Tony, we can't go back to 1997."

and I say, "No, we can't.

But the trouble is you guys want to go backwards.

You want to go pre-1997."

I agree, today all the things we were talking about then have accelerated.

They've not diminished or fallen away.

I mean, when Bill Clinton and I were launching the initiative around the human genome, and I always remember him saying to me at the time, "I think this is one of the most important things we'll ever do," which turned out to be true.

Not that I really understood it fully at the time.

But you fast-forward today, it's even more important.

Right?

So this is why I think that the problem is the populism in the West, it succeeds when the center can't solve the problems.

And I always say to people, "Populism doesn't invent grievances.

By and large, it doesn't invent them; it exploits them."

So if you take immigration, for example, you got to deal with immigration.

If you don't have an immigration policy today, which provides controls over it, even if you're telling people immigrants do a great job in our economy, but you still need control.

If you're not in that space, the populace is going to come along and exploit that issue.

So it's all about, in my view, the retrieval of that strong, clear center.

And this is where politics has got to reach out beyond the ranks of professional politicians, who've spent their whole life doing nothing but politics, and understand the world, embrace it, and then change it.

>> Prime Minister Tony Blair, thanks so much for joining.

>> Thank you.

♪♪ >> And now to "Puppet Regime," where Britain's newly crowned Queen Consort Camilla finds herself fighting off some competition for the job.

>> Britain's new King Charles isn't very popular, but people like his wife, Camilla the Queen Consort, even less.

Perhaps the U.K. could use a different Queen Consort?

Here to interview for the position are some world leaders.

First up, President Biden.

>> Huh?

Hey, there, Jack.

I just want to say if anyone's qualified to be the next Queen Consort, it's me.

>> And why is that?

>> Well, first off, I know a little something about being a figurehead but not getting much done.

>> But, Mr. President, you're on a roll these days.

>> Well, that's what they tell me.

My approval rating's on the rise, baby.

Probably better than Camilla's.

>> Not quite, sir.

You've really just gone from bad to less bad.

>> Hey, bad to less bad?

[ Chuckles ] That's our party slogan these days.

>> Maybe you should get back to work, sir.

Let's hear from another world leader.

I've got Vladimir Putin on the line.

Mr. Putin?

>> Da.

>> Do you think you'd make a better Queen Consort?

>> I mean, rich Russians are new British aristocracy anyway these days, da?

>> Lots of Russian money there still, yes.

But I mean, you are a man.

Can you really be Queen Consort?

>> Oh, now you're J.K. Rowling.

Is that it?

I thought decadent, woke, Western media would not care about such things.

>> Okay, Voldemort.

Well, I suppose being Queen Consort of the U.K. would help you learn how to give up a fallen empire more gracefully.

>> What?

You are a Nazi.

That is not the job description that I saw in LinkedIn.

Forget this crap.

>> President Putin?

Okay, I guess he's out.

Let's take a look at one more candidate.

Angela Merkel.

Why do you deserve to be Queen Consort?

>> Ah, look, sweetkins.

Since I retired, I've already read "Eat, Pray, Love" three times, finished a graphic novel adaptation of my graduate thesis, und I watched all of "The Crown," twice.

I need a job.

>> But you are not British.

You're German.

>> Yeah, so was the British royal family until World War I made it uncool.

>> Well, okay, Angela, I guess.

>> Uh, it's Miss Merkel.

Or Queen Angela, if you're nasty.

>> "Puppet Regime"!

>> That's our show this week.

Come back next week and if you like what you see, you love hearing about the royals or you can't stand the royals and you'd really like another topic, you can check us out at gzeromedia.com.

♪♪ ♪♪ ♪♪ ♪♪ >> Major corporate funding provided by founding sponsor First Republic.

At First Republic, our clients come first.

Taking the time to listen helps us provide customized banking and wealth-management solutions.

More on our clients at firstrepublic.com.

Additional funding provided by... ...and by...