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00:00THRILLED TO HAVE THE TIME OF IAN BREMMER OF EURASIA GROUP. WE DID TALK FOR FIVE HOURS, WHAT DOES ITALY MEAN, WHAT DOES IT MEAN FOR CHANCELLOR MERKEL? IAN: ANOTHER SELF-IMPOSED AND GOAL AS WE SAW FROM FORMER PRIME MINISTER CAMERON IN THE U.K. RENZI COMES IN, FEELS PRE-STRONG AND THINKS HE IS THE GUY THAT CAN DRIVE A REFORMIST WAVE AND EFFECT WE HOISTED TOM:? IS THIS POLITICS BY EGO BRIAN: A LITTLE BIT IAN: -- IAN: A LITTLE BIT. I THINK RENZI HAS DONE AN EFFECTIVE JOB . REFORMS ITALY GREATLY NEEDED. IT WOULD HAVE HELPED THE ECONOMY . THIS IS BACK TO THE STATUS QUO IN THAT REGARD. TOM: WHAT DOES IT MEAN FOR CHANCELLOR MERKEL? METAL GUARD WAS AT BLOOMBERG -- MADAME LAGARDERE MADE IT CLEAR THERE IS A NEW EUROPE. WHAT DOES THIS MEAN FOR ANGELA MERKEL AS SHE DRIVES EUROPE TO 2017? IAN: THERE IS NO MORE FORCE OTHER THAN MERKEL FOR STRONGER TIGHTER INTEGRATION OF THE EU AS A WHOLE. OBVIOUSLY THE TRANSATLANTIC RELATIONSHIP, WHICH IS THE MOST IMPORTANT IN UNDERPINNING US-LED GLOBALIZATION, HAS BEEN DECISIVELY REPUDIATED BY EVERYTHING IN EUROPE OVER THE LAST YEAR AS WELL AS WHAT THE ELECTIONS WE JUST HAD THREE WEEKS AGO. IT LOOKS VERY LIKELY THAT MERKEL GETS ANOTHER TERM AS CHANCELLOR IN GERMANY. PROBLEM IS HER ABILITY TO LEAD IS CONSTRAINED. TOM: BRIAN BELSKI IS AN EXPERT ON EQUITY MARKETS. HE'S BEEN A CONFIRMED BULL. WE HAVE A NEW REFLATION FROM MR. TRUMP AND OTHERS. WILL THAT WIDEN THE GAP YOU STUDY IN INTERNATIONAL RELATIONS OF POLITICAL ECONOMICS? EVER FRONT APART BY THE WORKING-CLASS PEOPLE OF FRANCINE LAQUA'S GENOA? IAN: NO REASON TO BELIEVE THAT POPULISM IS LOSING MOMENTUM IN EUROPE RIGHT NOW. IT IS CONSTRAINED IN GERMANY. BUT TWO ESTABLISHMENT PARTIES HAVE BEEN TAKEN OUT OF THE MAP. IF YOU ASK ME WHAT IS DRIVING IT IT IS IDENTITY POLITICS IN CONCERNS ABOUT IMMIGRANTS AND REFUGEES AND IT IS NOT GOING AWAY. TOM: YOUR CORPORATE OFFICERS DRIVE YOUR WORLD. DO THEY CARE ABOUT DOCTOR BREMMER'S WORLD? BRIAN: SURE THEY DO. ONE OF THE MOST IMPORTANT THINGS DR. BREMMER TALKED ABOUT IS HOW MERKEL IS GOING TO TIGHTEN UP THE EUROPEAN UNION. THAT PROBABLY NEEDS TO HAPPEN BECAUSE WHAT WE NEED TO SEE IS STRUCTURAL FUNDAMENTAL REFORM IN EUROPE. IF SHE'S ABLE TO TIGHTEN UP THE CONSTRAINTS OF WHAT IS HAPPENING IN EUROPE THERE'S A BETTER CHANCE TO SEE REFORM. ALL WE HAVE SEEN TO DATE IS MONETARY POLICY. WE NEED TO SEE THESE COMPANIES CUT COSTS AND REFORM THEMSELVES. TOM: A BIG OIL COMPANY, 5.6% DIVIDEND. IS EUROPE THE OFTEN AT -- THE ULTIMATE -- NEVER WINTER IN ROME. AT THE END BRIAN: OF THE DAY TO FACILITATE THAT DIVIDEND WE NEED TO BE OF THE SEA CASH FLOW AND I'M NOT CONVINCED THAT A LOT OF THESE EUROPEAN COUNTRIES CAN CONTINUE ON THE CASH FLOW FRONT TO PAY THOSE TYPES OF DIVIDENDS. AT THE END OF THE DAY CASH FLOW IS BEING USED TO GROW. WE'D BE UP TO GROW AND EXPAND THE CASH FLOW AND GIVEN CONSTRAINTS WITH RESPECTIVE BUSINESS AND INCREASING REGULATION, IT IS GOING TO BE DIFFICULT FOR A LOT OF THESE COMPANIES TO CONTINUE TO GROW PERIOD. FRANCINE: IF YOU LOOK AT FRANCE AND ITALY DO YOU THINK THE CIVIL CITIZENS OF THESE COUNTRIES ARE PRO-EURO? IAN: I THINK IN BOTH FRANCE AND ITALY RIGHT NOW YOU HAVE POPULATIONS THAT ARE MODERATELY PRO-EURO AND EU BUT THOSE NUMBERS HAVE BEEN GOING DOWN CONSISTENTLY. THERE IS LITTLE TO BE BEHIND. YOU SEE THAT EUROPE AS A CONSTRUCT RIGHT NOW IS FAILING. THE REASON THAT YOU PUT IT TOGETHER WAS NOT JUST TO HAVE A COMMON CURRENCY BUT COMMON VALUES. TO BRING THESE COUNTRIES TOGETHER TO CREATE A SUPER NATIONAL IDENTITY AND CREATE SOME LEVEL OF LOYALTY FOR GOVERNANCE THAT WAS ABOVE THEIR INDIVIDUAL COUNTRIES. THAT IS OBVIOUSLY BREAKING DOWN. YOU SAW THAT WITH THE SURPRISE WIN FROM F ILLON OVER SARKOZY AND JUPPE AND YOU SEE IT WITH RENZI, INCAPABLE OF DRIVING SOME LEVEL OF STRONG LEADERSHIP AREA BRINGS IT IS OVERWHELMINGLY THE BIG STORY HERE. EVERYTHING ELSE A SMALL CHANGE, IN PART BECAUSE OF HOW BIG IT IS FOR THEM TO LEAVE BUT ALSO HOW MUCH TRACTION IT WILL TAKE FROM EVERY OTHER POLITICAL STORY FOR YEARS NOW. THE ABILITY TO DRIVE PROACTIVE POLITICAL GOVERNANCE IN EUROPE

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Ian Bremmer: Europe, as a Construct, Is 'Failing'

Ian Bremmer, president at Eurasia Group, and Brian Belski, chief investment strategist at BMO Capital Markets, examine what the Italian referendum means to European politics and the political influence of German Chancellor Angela Merkel. They speak on "Bloomberg Surveillance." (Source: Bloomberg)

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