00:00:00
looking forward to our thing in a few
00:00:01
weeks yeah i don't know if I'll end up
00:00:03
being there but I'm hoping to i'm hoping
00:00:05
to it's been What do you guys You guys
00:00:06
have like a liberal cuddle party or what
00:00:08
are you doing yeah yeah larry Larry
00:00:10
takes a bunch of MDMA and we all sort of
00:00:12
go into the the corner and hang out
00:00:14
together god that sounds incredible
00:00:16
liberalism is wonderful man you should
00:00:18
come try it that's not liberalism it's
00:00:19
called something else sorry Nikki is our
00:00:22
cryptozar joining us or no he's uh I'm
00:00:25
talking to now it looks like he is oh
00:00:28
zing this is going to be great this will
00:00:30
be like ratings bonanza all right we do
00:00:32
have David Saxs here david make sure you
00:00:34
have a quick time on look at Sax looking
00:00:36
so presidential he looks thin doesn't he
00:00:38
oh he looks fabulous all right here we
00:00:40
go three two one let your winners
00:00:46
[Music]
00:00:50
we open source it to the fans and
00:00:52
they've just gone crazy with it
00:00:58
all right everybody welcome back to the
00:00:59
number one podcast in the world i'm your
00:01:02
host Jason Calcanis with my besties Chim
00:01:05
Polyha Patia our chairman dictator and
00:01:08
live from well the administration Mr
00:01:12
david Saxs our ZAR for AI and crypto and
00:01:16
amazingly two fantastic guests this week
00:01:20
we have uh New York Times writer and
00:01:22
host of the Ezra Klein podcast he's got
00:01:25
a new book with Derek Thompson Abundance
00:01:27
and he co-founded Vox in 2014 and he's
00:01:30
our guest here today before Trump ships
00:01:32
him to El Salvador please welcome Ezra
00:01:35
Klein how are you sir glad to be here in
00:01:36
my final hours of freedom okay great
00:01:39
good to be here sorry Saxs uh and uh
00:01:41
with us of course Larry Summers
00:01:43
economist former Treasury Secretary
00:01:45
under Clinton former director of the
00:01:47
National Economic Council under Obama
00:01:49
and the president of Harvard from 2001
00:01:52
to 2006 thanks for coming Larry good to
00:01:54
be with you okay we have a lot to get to
00:01:57
here so we uh might as well talk about
00:02:01
the big news of tariffs it's day 80 of
00:02:04
the Trump presidency and a second
00:02:08
presidency his second term and Trump
00:02:10
tweeted that he paused tariffs for
00:02:12
everyone but China on Wednesday
00:02:14
basically let me just ceue up the
00:02:16
details Larry and then we'll get your
00:02:17
take on all of this just one week after
00:02:20
Liberation Day Trump announced on Truth
00:02:23
Social that in effect he was raising
00:02:27
tariffs against China
00:02:29
125% based on their lack of respect
00:02:31
quote unquote instead of negotiating and
00:02:34
that he was pausing reciprocal tariffs
00:02:36
on all other countries for 90
00:02:38
days and markets ripped 10% after he
00:02:42
posted this and today Thursday when we
00:02:45
tape there's been a massive selloff on
00:02:47
Wall Street so the roller coaster ride
00:02:49
continues what it will be on Friday when
00:02:51
you consume this podcast is anyone's
00:02:54
guess s&p is down 5% today for context
00:02:58
the S&P was at 5700 pre-liberation day
00:03:02
so about a 9% drop after these wild
00:03:05
swings and uh in fact this has been
00:03:09
historic
00:03:11
volatility here are the top selloffs in
00:03:15
history as you can see three of them
00:03:17
came during Black Monday in
00:03:20
1987 three of them came during the
00:03:23
financial crisis three of them came
00:03:25
during COVID and uh coming in 11th is
00:03:28
Trump's tariffs also in the gainers uh
00:03:32
you have these big
00:03:34
rebounds wednesday's 9.5% recovery was
00:03:37
number three the administration says
00:03:39
this was all part of a master plan we'll
00:03:41
hear more about that later and that they
00:03:44
laid a trap for China they lit a trap
00:03:47
bessent has been the
00:03:49
spokesperson during this retreat or
00:03:53
whatever we're going to call the uh
00:03:54
pause and quote "This was driven by the
00:03:58
president's strategy." He and I had a
00:04:00
long talk on Sunday and this was his
00:04:02
strategy all along i don't think we need
00:04:04
to play the clip uh that's the gist of
00:04:05
it the White House account then tweeted
00:04:09
in all caps "My favorite way to tweet do
00:04:11
not retaliate and you will be rewarded."
00:04:14
Wall Street Journal on the other side
00:04:15
posted a story about why Trump blinked
00:04:18
they chronicled the decision as uh being
00:04:20
affected by Jaime Diamond who went on
00:04:23
Fox to express fears of recession while
00:04:25
saying the tariffs were valid and that
00:04:28
he knew that Trump and cabinet would be
00:04:29
watching him on Fox other banking
00:04:31
executives who felt they didn't have a
00:04:32
lot of influence in this administration
00:04:35
according to the Wall Street Journal
00:04:36
started lobbying Republican
00:04:38
lawmakers that the Trump tariff plan
00:04:40
would tank the economy the White House
00:04:42
chief of staff Susie Wild started
00:04:44
receiving calls from executives and
00:04:46
lobbyists expressing concerns and uh the
00:04:49
Wall Street Journal reports that Trump
00:04:50
was influenced heavily by Bessant they
00:04:52
were flooded with worried calls from
00:04:54
Wall Street and that the president was
00:04:58
uh lobbyed to find an off-ramp trump
00:05:01
ultimately relied on his instincts
00:05:03
according to the administration larry is
00:05:06
this 4D
00:05:07
chess or is this something else what are
00:05:10
your thoughts
00:05:12
this is uh dangerous work with a
00:05:16
sledgehammer on a pretty sensitive
00:05:18
machine which is the global economy
00:05:21
that's having really serious uh
00:05:25
consequences first it's important to
00:05:27
understand that there's more tariffs
00:05:30
that are around than you described even
00:05:34
after the big backoff there's a 10%
00:05:37
across the board tariff a range of
00:05:40
structural tariffs like on steel and
00:05:43
automobiles and a range of new tariff
00:05:46
threats like on uh
00:05:49
pharmaceuticals here's a kind of
00:05:51
market-based estimate of what the damage
00:05:55
that the market thinks this is all doing
00:05:58
to the US economy is market's down let's
00:06:01
take today's number 9% if that's right
00:06:06
that would be about $4
00:06:09
trillion of course the at $4 trillion
00:06:12
since Liberation Day of course markets
00:06:15
were down coming into Liberation Day
00:06:18
because of some anticipation of these
00:06:20
policies so let's be conservative and
00:06:23
say these policies have taken $6
00:06:25
trillion off the stock market now the
00:06:29
stock market only measures the adverse
00:06:31
impact on corporate profits not the
00:06:34
adverse impact on workers not the
00:06:37
adverse impact on consumers so you need
00:06:40
to add to that uh stock market number uh
00:06:45
one way of thinking about adding to it
00:06:47
would be to say that corporate profits
00:06:49
were 10% of the economy so you could
00:06:52
argue for multiplying by a factor of 10
00:06:55
but maybe that's being too exaggerating
00:06:58
or too bold so let's multiply by a
00:07:01
factor of uh five and what you get is a
00:07:05
loss in the $30 trillion range as the
00:07:09
present value as estimated by markets of
00:07:13
what's being done now I know the Trump
00:07:16
administration sometimes likes to say
00:07:18
it's working for Main Street not Wall
00:07:20
Street i noticed that they were pretty
00:07:23
excited about the stock market rally
00:07:25
yesterday in a way that wouldn't really
00:07:27
go with uh not caring about uh markets
00:07:34
so I think what markets are seeing
00:07:37
what's is what's true which is three
00:07:41
things this is an inflation shock cuz
00:07:46
you're adding to prices ceo of Amazon
00:07:50
got it right the Secretary of the
00:07:53
Treasury got it wrong increases in
00:07:55
tariffs of this magnitude the
00:07:58
overwhelming part of them will be passed
00:08:01
on to consumers so you've got an
00:08:04
inflation shock when you raise the
00:08:07
prices of people and their income at
00:08:10
least in the short run is the same
00:08:12
they're poorer and that means they can
00:08:14
afford less stuff and that pushes the
00:08:18
economy down and so you've got higher
00:08:23
inflation and you've got um more uh less
00:08:28
demand and therefore more
00:08:31
unemployment all of that's bad for the
00:08:33
economy and companies and the last thing
00:08:36
which I think is profoundly important is
00:08:42
we are trading like an emerging market
00:08:44
country right now
00:08:47
for serious countries for the United
00:08:50
States the pattern is that when the
00:08:54
world gets
00:08:55
riskier the bonds go down in yield and
00:08:59
the currency goes up in value because
00:09:02
people come for the safe
00:09:05
haven when you're a country like
00:09:08
Argentina then the assets all move
00:09:11
together falling stock prices go with
00:09:14
higher bond yields go with a weakening
00:09:18
currency and so because of our erratic
00:09:22
behavior we have changed the
00:09:25
zeitgeist surrounding America from the
00:09:29
traditional zeitgeist surrounding
00:09:31
America to the kind of zeitgeist that
00:09:34
surrounded Juan Peron's
00:09:36
Argentina and that goes with all the
00:09:40
other things that are happening the more
00:09:44
protectionism denying the independence
00:09:46
of the central bank fiscal
00:09:50
irresponsibility breakdown of
00:09:52
traditional boundaries between
00:09:54
government and business substantial uh
00:09:58
cronyism as a strategy authoritarian
00:10:02
tendencies towards uh the opposition
00:10:07
lack of total respect for uh the
00:10:10
judiciary larry keep going Larry what
00:10:13
we're seeing is a is a pattern of
00:10:18
America being governed on the kind of
00:10:21
Juan Peron Argentina model and that
00:10:25
sometimes produces some benefits for
00:10:27
some people in the short run that
00:10:29
sometimes generates popularity
00:10:32
uh for it peron kept coming back in
00:10:36
Argentina but ultimately it's extremely
00:10:39
costly for our society uh you've you've
00:10:43
heard uh Larry's uh take on all of this
00:10:46
larry's giving it about a a B+ on the
00:10:48
Harvard great scale
00:10:51
which might be inflated i'm not sure
00:10:53
sachs obviously in the administration
00:10:55
you cover two things AI and of course
00:11:00
crypto and you're a member of the pod so
00:11:03
let's get your take on what happened
00:11:06
this week with these tariffs even the
00:11:09
most ardent supporters of Trump have
00:11:11
felt this is chaotic not well executed
00:11:15
not communicated well what's your take
00:11:18
Saxs on how this was executed and could
00:11:21
this have been done better well I think
00:11:23
what happened if you go back to
00:11:25
Liberation Day was only 8 days ago it
00:11:27
was April 2nd if I had told you on April
00:11:31
1st that Donald Trump would find a way
00:11:34
to get the entire world to eagerly
00:11:37
embrace a 10% tariff on the American
00:11:40
market and not only would they not
00:11:42
complain but they'd actually be relieved
00:11:44
that it was only 10% you would have said
00:11:46
that would be an April Fool's joke if I
00:11:48
had told you eight days ago or nine days
00:11:51
ago that Trump would find a way to
00:11:53
accelerate the United States is
00:11:54
decoupling from China which is something
00:11:56
he's long wanted to do and that Wall
00:11:59
Street would basically breathe a sigh of
00:12:01
relief over that you would have said
00:12:03
that there's no way that could happen if
00:12:05
I had told you eight or nine days ago
00:12:07
that President Trump figured out a way
00:12:09
to assert a presidential power in a way
00:12:11
that gives America extraordinary
00:12:12
leverage over virtually every country in
00:12:14
the world you would have said "Well I
00:12:16
don't believe it i don't you know what
00:12:18
what is that power and he proceeded to
00:12:20
do that and now basically every country
00:12:22
in the world except for for China is
00:12:24
coming to Washington seeking to
00:12:26
negotiate a new trade deal for the
00:12:28
United States on better terms for the US
00:12:32
if you told me any of that few days ago
00:12:34
I would have believed you and I would
00:12:37
have thought the consequences would be a
00:12:39
substantially
00:12:41
deteriorated American economy and a
00:12:44
substantially less secure i don't think
00:12:46
we know that United States i don't think
00:12:47
we know that it's not any surprise
00:12:49
there's nothing surprising about the
00:12:51
fact that the United States has the
00:12:53
power to extort Loto it's just and
00:12:56
that's that's the country that was
00:12:58
singled out in the Trump formula for the
00:13:00
highest level of protection there is no
00:13:05
surprise in uh that there is no surprise
00:13:10
that capacity to isolate itself to
00:13:13
Washington will be very very Japan's
00:13:15
coming to Washington south Korea is
00:13:17
coming to Washington everybody's going
00:13:18
to try to cut everyone's going to come
00:13:19
to Washington it never would have
00:13:21
occurred to anyone with experience in
00:13:24
government that the United States would
00:13:26
have any difficulty getting any major
00:13:29
country to come send a representative to
00:13:32
the United States to have a discussion
00:13:34
and a negotiation with a United States
00:13:38
on a matter that was of concern to the
00:13:40
United States they never could possibly
00:13:42
have commish any Let me let Sax reply to
00:13:44
that and then Ezra I'm going to bring
00:13:46
you in saxs go ahead you reply then why
00:13:48
didn't they Larry do you think that all
00:13:51
these countries were going to
00:13:52
renegotiate their trade deals with the
00:13:54
US if President Trump asked nicely if he
00:13:57
said pretty please renegotiate our trade
00:13:58
deals so you take down your trade
00:14:00
barriers they would have done it if he
00:14:02
had said pretty please with a cherry on
00:14:03
top that's not the way these things work
00:14:05
he had to establish the leverage in the
00:14:07
negotiation first and the fact of the
00:14:09
matter is he's the first president in
00:14:11
decades who's been willing to do that
00:14:13
you don't get anywhere by just asking
00:14:15
nicely and I think that what President
00:14:17
Trump did over the last eight days is a
00:14:19
establish the leverage and b get all
00:14:22
these countries to now want to negotiate
00:14:24
a new trade deal with the United States
00:14:26
if this is such a terrific
00:14:28
thing why do markets think it's so
00:14:31
terrible for the American economy maybe
00:14:33
there maybe the market's just completely
00:14:36
wrong but at least another possibility
00:14:39
is the question that the market's
00:14:41
judging this that the market I mean job
00:14:43
of markets is to look forward it's to
00:14:46
look past the immediate it's to see what
00:14:50
the long run consequence are going to be
00:14:52
and markets are making a pretty
00:14:54
devastatingly negative judgment not true
00:14:57
not true not true that feels emotional
00:15:00
and nice but it's just not accurate so
00:15:03
let's just establish a couple facts
00:15:05
about quote unquote the markets number
00:15:08
one there are two markets and they
00:15:10
behave totally differently and sometimes
00:15:12
inversely to each other there's the
00:15:14
stock market and there's the bond market
00:15:17
with respect to the stock market what
00:15:19
they are debating and you're right Larry
00:15:21
is what is the effective long-term rate
00:15:25
of return a dollar needs to generate in
00:15:28
order to pay me back that dollar that is
00:15:30
what the fundamental stock market does
00:15:33
and what we've seen for many years with
00:15:36
trade imbalances trade deficits and
00:15:39
close to zero interest rates of which
00:15:41
more of that happened under Democrats
00:15:43
and Republicans we have allowed the
00:15:46
stock market to inflate past historical
00:15:49
averages what we've actually seen happen
00:15:52
in the last week is what most people
00:15:55
would call mean reversion the stock
00:15:57
market is still way above where it was
00:16:00
last year two years ago three years ago
00:16:04
what has happened is that the forward
00:16:05
multiples have compressed so that's
00:16:07
number one that's a fact you can debate
00:16:09
whether that's bad or good and I'm
00:16:10
willing to debate that with you okay now
00:16:13
let's go to bonds and then with respect
00:16:15
to bonds what we are seeing now is there
00:16:17
are two very complicated issues and we
00:16:20
don't know what the unknown known is and
00:16:23
let me be very specific in the last two
00:16:26
days we saw one part of the bond market
00:16:29
totally get out of
00:16:31
whack and what we know is that the
00:16:34
yields changed materially in a very
00:16:36
acute way which is atypical of how the
00:16:40
bond market typically digests a
00:16:43
philosophical change in approach to
00:16:45
policy normally when you see an acute
00:16:48
reaction in the bond market the
00:16:50
underlying reason tends to be some
00:16:52
financial calamity in a participant what
00:16:56
we heard in the last 24 hours is a lot
00:16:59
of this move may have been attributed to
00:17:03
an enormous levered bet on US treasuries
00:17:07
by a Japanese hedge fund it will take
00:17:10
three and four and five and 6 weeks for
00:17:13
us to really know separately what we do
00:17:15
know though where the structural
00:17:17
complexity of the market and this is
00:17:19
where Larry I agree with you is acute
00:17:22
and important to observe is in the
00:17:24
credit markets for private companies and
00:17:26
that is where you have to pay a lot of
00:17:28
attention okay Larry let me let you
00:17:31
respond to Chimath's response to you and
00:17:34
then Ezra I promise you're going to come
00:17:35
in next larry go ahead martha as you
00:17:39
well know the vast majority of financial
00:17:42
thinking
00:17:44
emphasizes changes in the earnings
00:17:46
prospects of companies associated with
00:17:49
the strength of the economy as a major
00:17:52
source of stock market fluctuations and
00:17:55
if you look at dividend strips if you
00:17:57
look at what's happening to analyst
00:18:00
revisions that's got a lot to do
00:18:02
negative prospects for the economy has a
00:18:05
lot to do with why the economy why the
00:18:08
stock market has turned downwards the
00:18:11
foreign exchange market's very big and
00:18:14
it's a big referendum on whether people
00:18:17
have confidence in uh the United States
00:18:21
and somehow tariffs reduce imports are
00:18:26
supposed to reduce dollar selling and
00:18:28
make the currency go up and not only is
00:18:30
the currency not going up it's going
00:18:33
down substantially so we're seeing a
00:18:37
pattern maybe it's all just due to one
00:18:39
Japanese hedge fund but maybe we're
00:18:42
seeing a pattern that really looks that
00:18:45
looks pretty much like uh the Argentine
00:18:48
pattern ezra you uh are hearing this
00:18:51
debate i think there's no debate that
00:18:53
this was done in a very extreme fashion
00:18:56
at a minimum do you wonder if this could
00:18:59
have been done in a more gradual or
00:19:02
thoughtful way what's your take on the
00:19:04
execution here by the administration of
00:19:06
these tariffs and their response to the
00:19:09
markets i I can't say I wonder if it
00:19:10
could have been done in a more gradual
00:19:12
thoughtful way it could have uh I I
00:19:14
defer to Larry on the markets i'm more
00:19:15
of a a connoisseur of arguments and
00:19:17
something I've been thinking about over
00:19:18
the past very long 8 days is covering
00:19:23
the 2024 election and covering Donald
00:19:25
Trump's tariff promises and it was a
00:19:28
thing that liberals like me were doing
00:19:30
where we would do these shows and say
00:19:31
Donald Trump is promising a 10% to 20%
00:19:34
global tariff and then 65% tariff on
00:19:37
China and if he does that it'll have
00:19:39
this set of effects higher prices it'll
00:19:42
create financial uncertainty etc and
00:19:44
what I would be told like the the
00:19:46
counterargument was oh you libs you
00:19:49
always take him literally when you
00:19:52
should be taking him seriously had
00:19:53
became Swami on my show he said he's not
00:19:56
going to do that that's just a
00:19:57
negotiating ploy and this was the the
00:19:59
common line from Trump allies on Wall
00:20:02
Street and then I watched as he began
00:20:06
doing not just that but layering uh a
00:20:09
series of then bilateral tariffs on top
00:20:11
of that plan the markets began freaking
00:20:13
out while they were freaking out a bunch
00:20:15
of his defenders said "No no no actually
00:20:17
these tariffs which we told you were
00:20:19
never going to happen are actually a
00:20:20
great idea we need to reset the entire
00:20:22
global financial system and you can't uh
00:20:25
shift those tectonic plates without
00:20:27
creating a few earthquakes then the
00:20:30
moment the tariffs paused with the
00:20:32
90-day pause on the uh tariffs on top of
00:20:34
the 10% and the China tariff then I
00:20:36
heard "Nope that pause is genius haven't
00:20:39
you read the art of the deal?"
00:20:41
And what I would observe from this is it
00:20:44
usually when an idea is good you don't
00:20:47
need people jumping back and forth on it
00:20:49
so often going between these tariffs are
00:20:51
a bad idea but they're a smart
00:20:53
negotiating ploy to these tariffs plus
00:20:55
are an actually great idea and you
00:20:56
should all calm down as Trump said you
00:20:58
should all be cool back to know these
00:21:00
tariffs are a great idea i I think
00:21:02
something I'd love to hear from David uh
00:21:04
it's very hard to break the the pattern
00:21:06
being a podcast host i would like to
00:21:08
hear what the measure of success in two
00:21:11
years is right we can sit here and
00:21:14
speculate about the effect of these and
00:21:16
I'm much more on on Larry's side than
00:21:17
what I'm hearing from from Chimath and
00:21:18
David but if what are your measures what
00:21:23
in 2 years good question if
00:21:25
manufacturing you know employment or
00:21:27
whatever is below X will you be unhappy
00:21:30
if GDP is what what is a a sort of uh
00:21:33
objective yard stick where we could come
00:21:35
back in 700 days and say did this work
00:21:38
out or was this a bad idea go ahead i
00:21:42
would say probably the biggest thing
00:21:43
would be whether the US can
00:21:45
re-industrialize to some extent so that
00:21:47
we're not completely dependent for our
00:21:49
supply chains on on a potentially
00:21:51
hostile adversary and what is the
00:21:52
measure of that is it the the quantity
00:21:54
of manufacturing we're making is it the
00:21:57
share of manufacturing i think that's a
00:21:58
hard thing to understand you know during
00:22:00
co we
00:22:01
learned point I am saying it concisely
00:22:05
during co we discovered that we were
00:22:07
horribly dependent on a supply chain
00:22:09
from China for some of our most
00:22:11
essential products for pharmaceuticals
00:22:13
for other medical gear that we needed
00:22:15
during co Sure so what would be if you
00:22:17
were to put a metric on just as one
00:22:19
example but we've also learned that our
00:22:22
entire supply chain for all sorts of
00:22:23
industrial products now is dependent on
00:22:25
China and other countries so let's be
00:22:27
more precise we have 4%
00:22:29
unemployment at the record low of our
00:22:32
lifetimes and do you think Americans
00:22:34
want to work in these factories and if
00:22:36
so which factories obviously
00:22:38
pharmaceuticals that's a dependency
00:22:40
obviously building ships and weapons
00:22:41
that's a dependency i think we can all
00:22:43
agree on that and that might be hundreds
00:22:44
low hundreds of thousands of jobs do you
00:22:47
believe we should be making Nike
00:22:48
sneakers here do you believe we should
00:22:50
be making jeans here again what what
00:22:52
would be the objective measure of
00:22:54
success like a certain number of jobs
00:22:56
certain number of factories certain
00:22:58
types of factories because the other
00:22:59
piece that I don't understand and maybe
00:23:01
you can inform me here Saxs is number
00:23:04
one who's going to do this work if we're
00:23:07
uh going to be deporting millions of
00:23:09
people and we have the lowest
00:23:10
unemployment of our lifetimes and we
00:23:12
have automation coming to these
00:23:13
factories and Americans don't want to
00:23:15
take these jobs historically how is this
00:23:18
all going to work it seems a bit
00:23:20
farcable to me that we're going to bring
00:23:22
these things back i don't think the the
00:23:23
millions of Americans who lost their
00:23:25
jobs in the heartland because we let
00:23:27
China into the WTO which is something
00:23:29
that Larry I think supported and
00:23:31
championed talking about decades though
00:23:32
right that's what started this whole
00:23:34
thing yeah okay okay I don't think those
00:23:35
millions of people want to lose their
00:23:36
jobs you're talking nonsense what are
00:23:39
you talking about respectfully David you
00:23:42
are Treasury secretary when we walk when
00:23:44
we walk China into the WTO and you're
00:23:46
just still defending it I was just
00:23:48
watching an interview hold David Larry
00:23:50
you just did an interview with Neil
00:23:52
Ferguson
00:23:53
answer why am I the only one who gets to
00:23:55
talk for two seconds before I get
00:23:56
interrupted you guys give 5 to 10
00:23:58
minutes finish your thoughts finish your
00:24:00
thoughts i got to speak for two seconds
00:24:02
then you interrupt me you speak for five
00:24:04
or 10 minutes go right ahead larry I
00:24:06
just saw you do an interview with Neil
00:24:08
Ferguson where he asked you was it a
00:24:11
good idea to bring China into the WTO
00:24:13
was it a good idea to give them
00:24:15
permanent normal trade relations status
00:24:17
basically MFN which is something that
00:24:19
Bill Clinton did in 2000 and I admit it
00:24:22
was bipartisan george W bush continued
00:24:24
it was and you were defending this as a
00:24:27
good idea for the country what was the
00:24:29
result of that over the past 25 years
00:24:31
millions of industrial jobs were lost or
00:24:34
export to China millions of factories
00:24:36
shut down the United States has a
00:24:38
diminished and hollowed out industrial
00:24:40
base we certainly can't make the
00:24:41
products of the future like drones or
00:24:44
semiconductors jason just to answer your
00:24:46
question yeah obviously some industries
00:24:48
are more strategic than others do I
00:24:50
personally care about sneakers or
00:24:52
textiles no I personally don't do I care
00:24:54
about semiconductors absolutely do I
00:24:56
care about circuit boards do I care
00:24:57
about drones do I care about robots do I
00:24:59
care about EVs and cars absolutely okay
00:25:04
those industries we are no longer in a
00:25:06
position we are no longer in a position
00:25:08
as a country to make those products
00:25:10
because we exported our entire supply
00:25:12
chain and manufacturing base to China i
00:25:15
have three so how is that a good idea
00:25:16
Larry okay I have three questions and
00:25:18
then Ezra I'll go back to you and Shim
00:25:19
go ahead i have three questions for you
00:25:22
one can you name a single trade barrier
00:25:27
that was reduced by the United States
00:25:30
associated with China accession a single
00:25:33
restriction that existed uh in the
00:25:35
United States that had not been in place
00:25:38
for 5 years before that we removed
00:25:42
during China's WTO accession can you
00:25:45
name one i don't think we should have
00:25:46
done any of it Larry we threw open our
00:25:48
markets to Chinese goods what
00:25:50
restriction your your thesis is that we
00:25:54
threw open the market and therefore we
00:25:56
exposed ourselves to all of this China
00:25:59
thing and question I'm asking you is can
00:26:02
you name any restriction on Chinese
00:26:07
exports to the United States that was in
00:26:11
effect in
00:26:13
1999 and was removed by our WTO
00:26:17
accession in 2000 can you name any such
00:26:21
restriction just name this was a policy
00:26:23
that built up over time and was
00:26:25
basically made permanent hold on it was
00:26:26
made permanent when we walked China to
00:26:28
the WTO and gave them MFN status sorry
00:26:31
i'm sorry David i'll ask the question
00:26:32
one more time we had given them MFN
00:26:37
status 15 years
00:26:40
before no one they had MFN status they
00:26:45
had it for 15 years there was not a
00:26:48
single reduction in a barrier to Chinese
00:26:52
trade so the way in which you're
00:26:54
describing it is just bears no
00:26:57
resemblance to what it was bring him
00:27:00
into the WTO what was the point of
00:27:01
bringing him into the WTO bringing them
00:27:04
into the WTO was to use the leverage
00:27:06
that we had to win a whole variety of
00:27:10
concessions that enabled us to um Larry
00:27:15
more to
00:27:17
China reciprocity this is an
00:27:20
extraordinary history here let's move
00:27:23
forward history you're denying totally
00:27:25
denying history all right listen this is
00:27:27
a bad deal hold on a second i want to
00:27:29
Let's go back to this just a minute i
00:27:30
just want to know the the whole argument
00:27:34
you are making is about increased
00:27:38
exports to the United States that had
00:27:40
bad consequences and so I'm just going
00:27:42
to keep asking you what barrier that
00:27:46
previously existed okay I'll name them
00:27:49
i'll I'll name them i'll name them go
00:27:51
ahead let me get you number one prior to
00:27:55
the WTO China imposed a bunch of export
00:27:57
duties and taxes on a whole bunch of
00:27:58
goods to control outflow okay that
00:28:00
prioritized domestic supply as part of
00:28:03
coming into the WTO China said "Hey hold
00:28:05
on we'll limit these export duties to
00:28:08
only a specific set of
00:28:10
products and then they cap those duties
00:28:12
at agreed rates." Number two they
00:28:15
eliminated export quotas they you
00:28:17
historically had export quotas to manage
00:28:19
the volume of goods under that WTO
00:28:21
commitment they agreed to phase out all
00:28:23
those quantitative restrictions on
00:28:24
exports except were explicitly justified
00:28:27
under WTO number three they removed the
00:28:29
export licensing restrictions number
00:28:31
four they ended state trading monopolies
00:28:33
for exports number five they liberalized
00:28:35
foreign trade rights the point is people
00:28:37
thought that China was going to be a
00:28:39
honeypot of economic activity and it
00:28:42
turned out to be a sucking sound a grand
00:28:44
sucking sound of opportunity where the
00:28:47
globalist corporations saw a massive
00:28:49
labor arbitrage so it's fair to say that
00:28:52
it was done with the best of intentions
00:28:54
but it was a bad deal and they got one
00:28:56
over on us want to say that rather than
00:28:58
having 30 minutes of debate over
00:29:01
something that happened in the '90s I
00:29:02
would I would like to go back to this
00:29:04
question i keep not hearing I will
00:29:05
answer your question because that was a
00:29:06
great hear from David um but I'm I'm I'd
00:29:09
love your
00:29:10
student i never got a chance to tendency
00:29:13
to just begin talking in an anecdotal
00:29:16
way about
00:29:19
aneot
00:29:24
announces you are going to look for
00:29:26
where if it's if in four two years it is
00:29:29
under X I can come back and we can have
00:29:31
a conversation here's the metrics ezra
00:29:33
I'm so sorry here's the metrics for you
00:29:34
okay let's go back to Bill Clinton's
00:29:36
speech that was given at John's Hopkins
00:29:38
on March 9th 20 he was asking about
00:29:40
forward David forward-looking metrics
00:29:42
what would you think would be successful
00:29:43
two years from now not the history
00:29:44
lesson wait hold on we haven't finished
00:29:46
the debate about China and PNTR okay but
00:29:49
my question predated that debate yeah
00:29:51
we're trying to get Listen you're trying
00:29:52
to change the subject let's just finish
00:29:53
up on this no no we're trying to move
00:29:54
forward that's all I'm just trying to
00:29:56
finish up on this topic okay we'll let
00:29:58
you get the last word about this okay
00:30:00
you can have the last word march 9 2000
00:30:02
Bill Clinton announces PNTR at John's
00:30:05
Hopkins it's a very famous speech liam
00:30:07
maybe you can tell us about how it got
00:30:08
written anyway Bill Clinton promises
00:30:11
several things he makes a number of
00:30:13
arguments for PNTR he does not think
00:30:16
that this does nothing larry your
00:30:18
argument is that Bill Clinton didn't do
00:30:20
anything you're saying that somehow it
00:30:21
happened under Reagan or something like
00:30:22
that that's not what Bill Clinton was
00:30:24
arguing he said number one there'd be
00:30:26
huge economic benefits to the US he says
00:30:28
quote by this agreement we will increase
00:30:31
exports of American products he means to
00:30:34
China that will create American jobs
00:30:36
okay did that happen the way we intended
00:30:38
i don't think so number two is he
00:30:40
believed that when you looked at the
00:30:41
data on export flows from the United
00:30:43
States to China it actually did happen
00:30:45
at a quite substantial rate but with
00:30:48
huge trade deficits for the United
00:30:50
States you're arguing that they they did
00:30:52
not act in a discriminatory way towards
00:30:54
our products this idea that Americans
00:30:56
could just do business in China the way
00:30:58
that they could do business here is
00:30:59
ridiculous anyone who tried to do
00:31:01
business over their nose you had to
00:31:02
create a JV you had to get a local
00:31:04
partner give them 51% it was
00:31:06
extraordinarily difficult we were
00:31:07
discriminated against Larry it's
00:31:09
ridiculous to try and claim that somehow
00:31:11
this was an equal relationship okay and
00:31:14
we imported far more from them than we
00:31:16
ever exported to them so Bill Clinton
00:31:18
was wrong about that number two he said
00:31:20
that signing PNTR and and bringing China
00:31:24
to the WTO would promote democracy in
00:31:26
China that we would export one of
00:31:28
democracy's most cherished values
00:31:29
economic freedom did that happen i don't
00:31:32
think so he said this would strengthen
00:31:34
global trade by ensuring China adhere to
00:31:37
international trade rules reducing trade
00:31:39
barriers and resolving disputes through
00:31:41
WTO did that happen i don't think so and
00:31:43
then he said on national security he
00:31:46
said it would improve our national
00:31:47
security to bring China to WTO and help
00:31:50
make them rich he said quote "If we
00:31:51
don't deal with China in this way we
00:31:53
will increase the prospect that they
00:31:54
will turn inward." That's not what
00:31:56
happened we helped make China rich we've
00:31:58
exported millions of jobs to them they
00:31:59
built up their economy and their supply
00:32:01
chain to the point where now they are a
00:32:03
global competitor to the United States
00:32:04
they're a pure competitor we turned that
00:32:06
baby dragon into a Drogonsized monster
00:32:09
that can now challenge us in Asia and
00:32:12
across the world for primacy why in the
00:32:15
world we have done that just for
00:32:17
national security reasons that was a
00:32:18
very foolish thing to do okay so Larry I
00:32:21
I guess I have to let you maybe
00:32:23
self-grade how did you guys do is there
00:32:26
any regrets as Sax is pointing out there
00:32:29
obviously China has not magically become
00:32:30
a democracy but I guess you could argue
00:32:32
they do have a middle class now we
00:32:34
haven't gone to war with them so I guess
00:32:35
you could argue that this has been good
00:32:37
for relations but to Sax's point they
00:32:40
are incredibly powerful and they are our
00:32:41
top adversary how would you grade the
00:32:43
history of this so we can move forward
00:32:45
iowa was a surging growing reforming
00:32:52
economy growing at double-digit
00:32:55
rates that it was before there was any
00:32:59
WTO agreement the WTO agreement did not
00:33:03
change a single rule that represented a
00:33:06
US
00:33:08
restriction on imports from China it did
00:33:13
change a variety of rules not as far as
00:33:17
I would have liked that let the United
00:33:20
States export more to China and that
00:33:23
protected United States intellectual
00:33:26
property in China and that brought China
00:33:31
more closely into the international
00:33:36
system you need a
00:33:38
counterfactual for what would have
00:33:40
happened if China had been excluded from
00:33:43
the World Trade
00:33:44
Organization that counterfactual is not
00:33:48
that they would not have sold goods to
00:33:50
the United States that principle had
00:33:53
already been crossed 15 years before not
00:33:57
a single restriction was uh reduced so
00:34:03
look anything you would have done
00:34:04
differently i just don't get I I don't
00:34:06
get the whole uh mindset uh here i
00:34:11
understand that we should have done more
00:34:13
as a country for the rust belt and
00:34:17
invested in it much more heavily if I
00:34:20
was worried about dependence and
00:34:22
strategic and all that the last policy I
00:34:25
would have wanted to abolish was the
00:34:28
CHIPS act that's the largest boldest
00:34:31
thing the United States has ever done to
00:34:35
avoid dependence in a national security
00:34:38
area great let me bring the Trump
00:34:40
administration has killed all of that
00:34:43
jimoth you heard Ezra's original
00:34:44
question and the history here from Larry
00:34:47
and David looking at there are some
00:34:50
industries that we need strategically
00:34:52
pharma military cars these are fairly
00:34:55
obvious rare earth minerals uh are
00:34:57
obvious but we also have the lowest
00:35:00
unemployment of our lifetimes and
00:35:03
Americans probably don't want to work in
00:35:06
factories on mass what is your take on
00:35:09
going forward some metrics that this
00:35:12
administration should not Sax is saying
00:35:14
this you're saying it what what would
00:35:17
you measure this success as in terms of
00:35:21
onshoring and reducing dependencies if
00:35:24
to Ezra's point two years from now we
00:35:26
were degraded give us some specifics
00:35:28
here Chama there is a major issue that
00:35:31
the United States has that's much bigger
00:35:33
than China which can be framed in the
00:35:36
lens of resiliency and the ability to
00:35:40
fend for
00:35:41
ourselves there are supply chains that
00:35:44
have many single points of failure and
00:35:47
independent of whichever country that
00:35:50
single point of failure exists it could
00:35:52
be an ally or it could be a foe or it
00:35:55
could be a friendmy that creates risk
00:35:59
and I think what we are learning and
00:36:01
David's right it was really highlighted
00:36:03
during COVID we are not in a position to
00:36:05
take care of what we need so if I had to
00:36:08
very precisely answer Ezra's question I
00:36:11
would say that we need to measure and
00:36:14
protect four critical areas everything
00:36:18
else I think we can deal with some
00:36:20
inefficiency some single points of
00:36:22
failure but the following four areas
00:36:24
Ezra I would say are sacrosanked number
00:36:27
one is all of the technology both the
00:36:31
chips as well as the enabling technology
00:36:34
around artificial intelligence it must
00:36:37
be a robust largely American supply
00:36:40
chain it must you cannot have single
00:36:43
points of failure outside the United
00:36:44
States because what you see is even in
00:36:47
allied
00:36:48
countries their posture towards things
00:36:50
like free speech and other things can eb
00:36:52
and flow their posture on trade their
00:36:55
posture on defense okay so that's number
00:36:56
one can change chips got it number two
00:36:58
is energy we have a critical deficit of
00:37:02
electrons in America we do not have the
00:37:05
capability we need to make the energy we
00:37:07
need quickly in many ways we have supply
00:37:11
chain issues on nat gas we have critical
00:37:14
supply chains that can be shut off by
00:37:16
China around photovoltaics so whether
00:37:18
you believe in coal whether you believe
00:37:20
in that gas whether you believe in clean
00:37:22
energy we are in a very we got to shore
00:37:25
that up okay I think we're in agreement
00:37:26
keep going number three are there are
00:37:28
critical material inputs that drive the
00:37:31
material science of the future rare
00:37:33
earths are an example going back to
00:37:36
chips things like gallium things like
00:37:39
phosphorus even so we have a critical
00:37:43
minerals and rare earths and m and
00:37:46
material science input problem and then
00:37:48
the fourth Ezra are pharma APIs so that
00:37:51
when American citizens get sick we have
00:37:54
the ability to not just make it but also
00:37:57
design it and manufacture it because
00:37:59
some of these APIs the active principal
00:38:01
ingredients for many of the drugs
00:38:04
require very convoluted and complicated
00:38:06
processes cold chains and the like and
00:38:08
again there we depend on folks whose
00:38:13
view of the United States can change in
00:38:15
real time so if I had to say to Ezra
00:38:17
what I would expect is if the United
00:38:19
States government whoever was in charge
00:38:21
would put those four things on a board
00:38:23
then detail out all of the key inputs
00:38:26
measure how much we can make ourselves
00:38:28
versus import and then basically try to
00:38:30
level that playing field we would be in
00:38:32
a very good place a couple things
00:38:33
because I think I probably agree with
00:38:36
all of that and what it sounds like is
00:38:37
an excellent argument for Joe Biden's
00:38:40
policies which were functionally maybe
00:38:42
not the pharma side just literally that
00:38:44
let's pull out semiconductors and the
00:38:46
semiconductor supply chain let's pull
00:38:48
out energy let's p a couple of things
00:38:50
like that you know what was it a high
00:38:52
fence around a small garden was what
00:38:54
Jake Sullivan called it let's
00:38:56
particularly try to restrict the supply
00:38:59
chain export of AI critical materials to
00:39:02
China um they had a whole set of
00:39:04
policies about this now the Trump
00:39:06
administration the thing we are in
00:39:08
theory here discussing is an
00:39:10
extraordinarily broad-based set of
00:39:12
policies um it is tariffs on not just
00:39:15
China it's on Brazil it's not just on
00:39:17
critical industries like Chimath is
00:39:18
talking about but it's on you know
00:39:20
mangoes and avocados and you know lumber
00:39:23
from Canada and and basically everything
00:39:25
else i I guess there's an argument I
00:39:27
could sort of extract out of this that
00:39:30
the Biden administration believed what
00:39:31
they called French shoring which is that
00:39:33
you want to create an integrated supply
00:39:35
chain of of allied countries that we can
00:39:39
work with and that we can rely on and
00:39:41
the Trump administration I think
00:39:43
believes something depending on who's
00:39:45
talking more like that the entire supply
00:39:48
chain needs to be on to America
00:39:50
specifically but one of the problems and
00:39:52
the reason I I I'm keep trying to push
00:39:54
people to be very clear about their
00:39:55
arguments and very clear about their
00:39:57
metrics is that I feel like there's this
00:39:59
king's cup of what we're trying to
00:40:00
achieve here where one day it's that
00:40:02
we're trying to achieve the
00:40:03
re-industrialization of the American
00:40:05
heartland and the next we're trying to
00:40:06
replace the income tax with tariff
00:40:08
income and then the next we're just
00:40:10
using it as all-purpose surplus leverage
00:40:12
against any country that does anything
00:40:14
we don't like and the next day we're you
00:40:17
know using it for uh an entirely third
00:40:19
purpose and maybe we're just going to
00:40:20
use it to to isolate China but to bring
00:40:22
in our our friends but none of these you
00:40:26
can't do all of these things at once and
00:40:28
it needs to be very stable if you're
00:40:30
going to get companies to do these
00:40:33
long-term capex investment decisions
00:40:36
that take decades to play out nobody I
00:40:38
know in the market is you guys didn't
00:40:40
want to change anything you guys didn't
00:40:42
want to change anything about anything i
00:40:43
wasn't in the I wasn't in the Biden
00:40:45
administration number one I'm treating
00:40:46
Ezra and Larry as a team i would love to
00:40:48
change i just want to make sure to
00:40:50
change all here you mean the Democrats
00:40:53
didn't want to see if we can cause Let's
00:40:55
see if we can Larry won't even admit
00:40:57
that PNTR did anything can we not keep
00:40:59
doing PNTR for a minute let's look
00:41:00
forward not backward look at the look at
00:41:02
the chips act look at the IRA act they
00:41:04
did the exact things we're talking about
00:41:06
larry go ahead let's see if we can find
00:41:08
a little bit of agreement please here i
00:41:12
agree with Chamath's agenda i I may not
00:41:14
agree in every detail but I broadly
00:41:16
agree with Chamath's agenda and I'll go
00:41:19
a little further than that Ezra i think
00:41:22
Joe Biden's attachment to energy
00:41:24
security was kind of selective and
00:41:28
heavily oriented to green technologies
00:41:31
not others i thought cancelling the
00:41:33
Keystone pipeline was a clear mistake i
00:41:37
thought the stopping a variety of things
00:41:40
involving liquid natural gas were a
00:41:43
clear mistake so I think the Biden
00:41:47
administration's approach to regulation
00:41:51
that empowered every NGO with respect to
00:41:55
stopping transmission lines with respect
00:41:57
to constructing power plants because of
00:42:00
the importance of democratic
00:42:02
constituencies was a mistake so I think
00:42:05
energy security is a central objective
00:42:07
of policy and that there's a lot of room
00:42:11
to move beyond what the Biden
00:42:13
administration did i actually believe
00:42:15
that very strongly and agree with
00:42:18
Chimath and David what I don't
00:42:20
understand
00:42:22
is chips absolutely right the chips act
00:42:27
was all about making there be an
00:42:29
American semiconductor industry with
00:42:32
production in the United States as a
00:42:36
central priority the Trump
00:42:39
administration has declared war on that
00:42:43
rare earths you want to have a strategic
00:42:45
petroleum reserve for any rare earth you
00:42:48
want to do more mining in the areas that
00:42:51
Chamath says we should in the United
00:42:54
States or in friendly countries i am all
00:42:56
for that here's what I cannot understand
00:43:00
chamath they don't see how your
00:43:03
resilience agenda drives anywhere near
00:43:08
liberation day and the emphasis on uh
00:43:13
tariffs it drives towards a set of
00:43:16
specific industrial policies perhaps
00:43:19
including tariffs in some particular
00:43:22
product areas but steel from
00:43:27
Canada anything from
00:43:31
loto any natural resource uh product
00:43:37
across the board tariffs on everything i
00:43:39
think you are absolutely right about
00:43:42
resilience and that traditional
00:43:44
conventional economics has given it too
00:43:47
little thought and that co pointed that
00:43:50
up as a central issue what I can't
00:43:55
understand is why Donald Trump's echoing
00:43:59
of Liia Koko from the 80s about
00:44:03
tariffs is responsive
00:44:07
to any of that but but this is the point
00:44:10
I'm trying to draw around Biden i'm not
00:44:12
saying I agree with every way the Biden
00:44:14
administration defined its objectives i
00:44:16
just wrote an entire book about the
00:44:17
failures of Democratic policym in this
00:44:19
specific era what I am saying is the bid
00:44:22
administration's view of trade was that
00:44:24
there are targeted industries we should
00:44:26
be putting a lot of both uh domestic
00:44:29
policy and international policy into
00:44:31
play in order to protect and reshore or
00:44:34
French shore and the Trump
00:44:35
administration's view is that you have a
00:44:38
generalized problem running all across
00:44:41
the world that requires highly general
00:44:43
policies that then when I ask people to
00:44:45
defend it they sort of move to this
00:44:46
targeted argument donald Trump's view we
00:44:49
can I I feel like we end up making
00:44:51
something that is not that complicated
00:44:54
um into something much more complex than
00:44:56
it is since the 80s you know Larry's
00:44:58
point about Liika Donald Trump has seem
00:45:01
has appeared to hold the view that
00:45:04
anytime the US is operating at a trade
00:45:06
deficit with someone else that is uh
00:45:09
evidence we are being ripped off and
00:45:11
that is how you get at least the initial
00:45:13
set of tariffs here that work off of
00:45:15
bilateral trade deficits and try to
00:45:18
correct every single one with every
00:45:20
single country be it Loto or a
00:45:22
collection of islands inhabited by
00:45:24
penguins i I just I think it's really
00:45:27
important to be connected to the policy
00:45:29
that was actually announced and not sort
00:45:32
of projecting all of our own onto it
00:45:34
like yes Larry's right that you could
00:45:36
have a different set of critical
00:45:37
industries than Biden did the Biden team
00:45:39
was very focused on clean energy over
00:45:41
other kinds of energy i also did not
00:45:42
agree with like the liquid gas pause i
00:45:45
thought there were some you know there
00:45:46
and we did not do nearly enough on
00:45:48
things like permitting reform right
00:45:49
there's a lot you could have done that
00:45:51
they didn't do but if what you have in
00:45:53
your head is a targeted idea of
00:45:56
reshoring specific industries or
00:45:58
nearshoring or frenching or whatever
00:46:00
which is kind of what I'm hearing from
00:46:02
um from a number of people on this call
00:46:04
then it seems like you would want
00:46:05
targeted policies and what we have is
00:46:07
not targeted policies it's broad-based
00:46:09
policies a 90-day pause on larger
00:46:11
broad-based policies and a huge trade
00:46:13
war with China i would like to hear a
00:46:16
defense from somebody
00:46:19
ezra and I agree specific policies i'd
00:46:22
like somebody to explain to me why it's
00:46:25
a remotely sensible theory to say that
00:46:28
the United States is being exploited by
00:46:32
any country where the overall pattern of
00:46:36
trade is uh such that we are running a
00:46:40
trade deficit and maybe in the process
00:46:43
you could explain to me why my grocery
00:46:45
store is exploiting me because I'm
00:46:47
running a massive trade deficit with
00:46:49
that okay trade deficit shimath or Sax
00:46:52
who wants to take it i can start the
00:46:54
then maybe Sax can Saxon so let let me
00:46:56
actually start by giving some credit to
00:46:59
where Biden did do a few things right
00:47:02
just in the spirit of finding some
00:47:03
common ground inside the IRA i think
00:47:07
that there were two things and I've said
00:47:09
this pretty repeatedly but I just want
00:47:10
to put it on the record again the ITC
00:47:13
credits and the ITC transfer markets for
00:47:17
those credits the tax equity markets are
00:47:20
critical industries in America to
00:47:22
support private investment in all kinds
00:47:25
of very complicated markets energy
00:47:28
markets being the most important and
00:47:31
what the Biden administration did to
00:47:33
their credit was remove the uncertainty
00:47:36
because those things had to be renewed
00:47:38
over and over again and they gave us a
00:47:41
very long window where we could
00:47:42
underwrite investments to your point
00:47:44
Ezra that was smart but it's important
00:47:47
to also remember that in order to get
00:47:49
Biden's budget done what they did was
00:47:51
they had Mansion roll over on permitting
00:47:54
reform and Ezra you know this probably
00:47:55
better than all of us when you look
00:47:57
inside of the chips act as smart as that
00:48:00
initial policy was if you ask why has
00:48:03
nothing actually happened why have no
00:48:06
fabs actually been built other than
00:48:08
grandio statements the answer is that
00:48:11
which you speak to in your book it's
00:48:12
just this complete malaise and inability
00:48:16
to actually get these things permitted
00:48:17
and turned on even when it's right so I
00:48:19
just want to acknowledge that that's
00:48:20
there so Larry to very very importantly
00:48:23
to your question the thing that we have
00:48:25
to acknowledge is that in certain
00:48:27
countries what you have is a very blurry
00:48:30
line between private and public industry
00:48:32
and they have this very tight coupling
00:48:34
and again I hate to go back to China but
00:48:36
it is the best example of this where
00:48:39
what do they have choose one other
00:48:40
country just for the sake of it we can
00:48:43
use Korea we can use Japan we can use
00:48:46
Germany okay there are instances where
00:48:49
the government balance sheets support
00:48:52
private industry they can support them
00:48:54
in three different ways number one is
00:48:57
the tax credits that they can use the
00:48:59
subsidies that they can use to build the
00:49:01
things that they need number two is how
00:49:05
then they can support that in the active
00:49:07
selling and engagement in public spot
00:49:09
markets to shape the demand curve of the
00:49:12
things that are made and then number
00:49:14
three is the taxation on the back end
00:49:16
the terms of repayment and the capital
00:49:19
cycle
00:49:20
those are things that in the United
00:49:22
States we
00:49:24
overwhelmingly turn the
00:49:26
responsibility over to the private
00:49:28
markets to do we are the cleanest the
00:49:30
purest form of capitalism in that sense
00:49:34
but many other countries are shades of
00:49:37
this and again let's not talk about
00:49:38
China which is the So so Larry hold on a
00:49:41
second so Larry so what you have is how
00:49:43
do you defend dumping how do you defend
00:49:46
that how do you defend spot market
00:49:48
manipulation that drives American
00:49:50
companies out of business how do you
00:49:53
fight that and I think here's the
00:49:55
problem if President Trump had announced
00:49:59
a big broadening of anti-dumping law to
00:50:05
confront a variety of instances of what
00:50:08
he what the administration after careful
00:50:11
economic analysis saw as inappropriate
00:50:15
subsidy i might or might not have
00:50:17
thought that they were doing that in the
00:50:20
right way but we wouldn't be having this
00:50:23
argument the front pages would not be
00:50:26
about tariff policy day after day and
00:50:29
the stock market would not be down by $5
00:50:31
trillion
00:50:33
the central thing we are discussing is
00:50:38
not whether there are sensible
00:50:40
modifications to trade policy to respond
00:50:42
to bad practices in other countries or
00:50:45
to promote resilience those are
00:50:48
technical debates that frankly aren't
00:50:50
that interesting to a large number of
00:50:52
people the question is whether declaring
00:50:56
that we need a whole new era of US
00:50:58
economic policy
00:51:01
around universal tariffs against
00:51:04
everything
00:51:06
is so I
00:51:07
think is a rational step forward or
00:51:12
using bilateral trade
00:51:14
surpluses now we're talking about the
00:51:16
Monte Carlo simulation of how to achieve
00:51:18
the outcome and what I am saying is
00:51:21
there is just as much as you and I want
00:51:23
to guess the fundamental and honest
00:51:26
answer is none of us know the people in
00:51:29
the White House what they know they will
00:51:31
share a little bit at a time because the
00:51:34
reality is if you what you wanted was a
00:51:36
white paper or if what you wanted was
00:51:39
paint by numbers I think back to David's
00:51:41
point all that would do is just take any
00:51:43
leverage that they had and give people
00:51:46
the opportunity to shape their response
00:51:48
and I think in traditional game theory
00:51:52
and and again in traditional game theory
00:51:54
I think the right thing to do is when
00:51:56
you're playing poker you play street by
00:51:57
street what's the flop make a set of
00:52:00
actions what's the turn make a set of
00:52:02
actions what's the river make a set of
00:52:03
actions and I think if you're going to
00:52:05
play to win this is what they should do
00:52:08
keep their cards very very close to the
00:52:10
vest realize that you can't necessarily
00:52:14
surgically go and attack the lithium
00:52:16
market first then the rare earth market
00:52:18
second because it all goes back to the
00:52:20
same balance sheet it's the same actor
00:52:22
over and over i think there's a useful
00:52:24
analogy to draw here i think a lot about
00:52:28
an article Mark Danner wrote in the New
00:52:31
York Review of Books many years ago
00:52:32
about the Iraq War and it's an article
00:52:35
that has stuck in my mind forever
00:52:36
because what he says about it is that
00:52:39
one of the the difficulties of the
00:52:41
politics of the Iraq war is there was no
00:52:44
one war there was everybody's private
00:52:46
war that they were projecting on to the
00:52:48
Bush administration you have the liberal
00:52:50
humanitarian vision of why we were going
00:52:51
to war and what that war would look like
00:52:53
you had a realist vision for it you had
00:52:56
a vision that was more about uh weapons
00:52:58
of mass destruction and keeping the
00:52:59
homeland safe from terrorism you had
00:53:01
people believe there was an Iraq
00:53:02
al-Qaeda connection there were really
00:53:05
dozens of these which is how you got as
00:53:06
broad a coalition behind as bad a policy
00:53:09
as that together because everybody said
00:53:12
you know they're being a little bit
00:53:13
vague about what's really going on here
00:53:15
and why we're really doing this but I
00:53:17
bet you if you go into their heart of
00:53:19
hearts what they want is the thing I
00:53:22
want even though the policy doesn't
00:53:24
quite match what policy you would get
00:53:27
from starting from my premises and
00:53:29
that's really what I hear here i hear it
00:53:32
on this show but I hear it in general in
00:53:34
the discussion around this that there
00:53:36
are a lot of different objectives being
00:53:39
projected onto Donald Trump and his
00:53:40
trade war the objectives do not fit the
00:53:43
policies we're seeing the objectives are
00:53:45
not uh stably articulated by Donald
00:53:47
Trump or the people around him nor is
00:53:49
any specific objective being articulated
00:53:51
in a stable way without contradicting
00:53:53
objectives also being articulated at the
00:53:56
same time and look maybe in the end and
00:53:58
this is why I want to push you all on
00:54:00
metrics you get something you like out
00:54:02
of this but you're giving away a lot of
00:54:05
clarity just on the trust that what is
00:54:07
happening is people are keeping a good
00:54:09
hand of cards with a good strategy of
00:54:12
poker hidden from you as opposed to
00:54:14
what's happening is what we seem to be
00:54:16
seeing in public which is Donald Trump
00:54:18
is a chaotic and erratic person they are
00:54:20
making policy in a chaotic and erratic
00:54:22
way that policy is having chaotic and
00:54:24
erratic consequences and then they are
00:54:27
operating and moving on the fly in a
00:54:29
chaotic and erratic fashion sax you
00:54:31
heard Ezra say that they he feels this
00:54:34
administration is being a bit chaotic in
00:54:36
the approach here what's the counter to
00:54:37
that you heard Shamant say "Hey this is
00:54:39
a really thoughtful they're holding
00:54:40
their cards close to the chest." Maybe
00:54:42
you could clarify what your position is
00:54:44
is this too chaotic or is this crazy
00:54:47
what I'm hearing is a bunch of process
00:54:48
objections to Trump's policy and I'm
00:54:51
hearing a bunch of nitpicking what about
00:54:52
Lutu or whatever okay look this is a
00:54:56
very unrealistic view of politics when
00:54:58
we've had a bipartisan consensus in
00:55:00
Washington for decades that unfettered
00:55:03
free trade is a good thing no matter how
00:55:06
big our trade deficits got no matter how
00:55:07
rich and powerful China got no matter
00:55:09
how unfair the trade practices got no
00:55:12
matter how many millions of our jobs and
00:55:13
factories got exported overseas this has
00:55:16
been the bipartisan consensus in
00:55:18
Washington and Larry you're right that
00:55:20
it started before the Clinton
00:55:21
administration and the George W bush
00:55:23
administration definitely accelerated it
00:55:25
but there has absolutely been a
00:55:26
bipartisan consensus in Washington that
00:55:28
this sort of unfettered free trade
00:55:30
policy was good for the country now how
00:55:34
do you change that now look you can
00:55:36
nitpick this and you can make all the
00:55:38
process objections you want but Donald
00:55:40
Trump has changed the conversation i
00:55:42
just want to let you keep saying I I've
00:55:45
offered a process suggestion when I'm
00:55:46
objecting to the absence can I finish
00:55:49
you were pointing to Donald Trump's
00:55:52
views when he was a public figure in the
00:55:54
1980s and 1990s on trade as somehow he
00:55:57
was wrong he was not wrong he was one of
00:55:59
the few people and the few public
00:56:00
figures in America who was right about
00:56:03
this i think most people today would say
00:56:05
he was right about this that throwing
00:56:08
open our markets to these to these
00:56:10
foreign products without thinking about
00:56:12
the consequences was a mistake you guys
00:56:14
have me completely confused really you
00:56:17
do no I'm confused about the incurrence
00:56:19
of your position larry Larry David you
00:56:22
still believe that the Clinton
00:56:24
administration let's call it a
00:56:25
bipartisan consensus of that era was
00:56:27
correct while at the same time you're
00:56:29
arguing that PNTR didn't do anything i
00:56:31
think it is really telling that you are
00:56:33
so much more loathed to defend what we
00:56:35
are seeing than to attack what has been
00:56:37
if you want to it's fine like I guess
00:56:38
you could have It would be interesting
00:56:40
to have you and to go if you'd be
00:56:42
interested to have you and Larry go 12
00:56:44
rounds on the Clinton era you know when
00:56:46
I say to you listen there is not a
00:56:48
stable set of objectives that fit the
00:56:51
policy here you say that's a process i
00:56:54
just would like somebody to defend the
00:56:56
thing they keep actually doing i would
00:56:58
like somebody to explain to me here i
00:57:01
understood Chimath Chimath resilience
00:57:05
central four sectors are we more
00:57:08
resilient in the four sectors what's the
00:57:11
answer in two years from now i got that
00:57:15
i agree all that i cannot make any
00:57:21
linkage between a 10% across the board
00:57:25
tariff a tariff on steel a tariff on
00:57:29
auto on
00:57:31
automobiles and much of what the rest of
00:57:34
the president says and your very valid
00:57:38
objectives i hear
00:57:40
David this free trade has destroyed
00:57:43
America and we're gonna undo that and
00:57:48
viscerated the heart and all this and I
00:57:50
just want to understand how we'll know
00:57:52
okay whether we have fixed okay look
00:57:54
well I I can answer this too go ahead go
00:57:56
ahead David all right look Larry and
00:57:58
Ezra welcome to a political coalition
00:58:01
different people have different
00:58:02
objectives just like different people
00:58:03
had different objectives for the policy
00:58:05
that we had in place 25 years ago okay
00:58:08
there are some people who think that we
00:58:10
should have an across the board 10%
00:58:11
tariff to raise revenue because the
00:58:14
country needs revenue and that that
00:58:16
would be a better way to raise revenue
00:58:17
than to say have income taxes or capital
00:58:19
gains taxes stan Ducken Miller who's not
00:58:21
a fan of tariffs nonetheless said that
00:58:24
he would support a 10% tariff no more
00:58:26
than 10 but up to 10 as a way to raise
00:58:29
revenue okay that's his point of view
00:58:32
there are other people and I would say
00:58:33
I'm more someone who thinks about the
00:58:35
geopolitical consequence of this who
00:58:37
think it was a huge mistake to throw
00:58:40
open our markets to Chinese products
00:58:42
basically feeding their economy to the
00:58:45
point where they could become a pure
00:58:46
competitor of the United States and
00:58:48
threaten the US to threaten the US world
00:58:50
order there are different people hold on
00:58:52
there's different people with different
00:58:53
objectives one more time because you're
00:58:56
you are just not speaking truth
00:59:00
want to know one restriction that the
00:59:04
United States had on Chinese products
00:59:08
that was changed in the year 2000 you've
00:59:12
said seven times throw open our market
00:59:14
to Chinese products i want to know one
00:59:19
example in which the United States
00:59:22
opened its market in
00:59:25
1999 the point just one the point of
00:59:29
Well the name one product where
00:59:32
restrictions were reduced okay David
00:59:34
Namon listen you're mischaracterizing
00:59:36
what PNTR did we can play this like uh
00:59:38
Grock game if you want people can go
00:59:40
ahead and grock this question and
00:59:41
they'll get this answer look the answer
00:59:43
is that before PNTR China was granted
00:59:46
MFN on a year-by-year basis by Congress
00:59:49
correct pntr made it permanent what does
00:59:52
that do it created a permanent new
00:59:54
framework for trade relations between
00:59:56
the United States and China so it it
00:59:58
created permanence and it created a
01:00:00
certain expectation what did that enable
01:00:02
massive investment by US companies in
01:00:06
China so all the bean counters from
01:00:09
McKenzie started talking about
01:00:11
outsourcing and just in time
01:00:13
manufacturing they started moving the
01:00:15
factories over there in a much greater
01:00:17
way you know the Mitt Romney and private
01:00:19
equity hold on for a second we finished
01:00:21
the Mitt Romney and private equity said
01:00:23
this is a great idea let's move all of
01:00:24
our manufacturing could we agree that
01:00:26
whether or not it was the WTR the
01:00:28
bankers on Wall Street got to
01:00:29
financialize and securitize all sorts of
01:00:32
new products okay that was the result of
01:00:35
PNTR the thing we have to decide really
01:00:38
right now as a country is if the thing
01:00:40
that you all are trying to replace us
01:00:41
with is better right if it will work and
01:00:44
so I want to go back to what you said a
01:00:45
minute ago David when you're like
01:00:46
"Welcome to political coalitions." Uh
01:00:48
Larry has been in politics a long time
01:00:50
he was Treasury Secretary i've covered
01:00:51
politics for a long time i'm familiar
01:00:54
with political coalitions in fact a lot
01:00:55
of my book is currently about the
01:00:57
problems in the way the democratic
01:00:58
coalition with too many objectives all
01:01:01
at once can end up destroying the
01:01:04
ability of the policy to actually
01:01:05
achieve a clear goal so this is this is
01:01:09
precisely the nonprocedural objection I
01:01:12
am bringing here this is why I think it
01:01:14
is dangerous to be treating an upheaval
01:01:17
of the entire global financial system
01:01:19
without a clearly defined objective that
01:01:21
is connected to a policy and so the the
01:01:24
question is if the idea is that there
01:01:27
are all these different players here who
01:01:29
have all these different policy
01:01:30
objectives that would connect to all
01:01:32
these different policies and everybody's
01:01:33
getting a little bit of them and Trump
01:01:35
is kind of flipping back and forth
01:01:36
through different versions of them you
01:01:39
could end up despite yes whatever
01:01:41
mistakes are made in the free trade
01:01:42
consensus which I do agree that we had
01:01:44
you could end up with a bad next not
01:01:47
even consensus just a bad next policy a
01:01:50
unclear coalition that is fighting with
01:01:52
itself and is making policy without a
01:01:54
strong process can create not like
01:01:56
nitpicky procedural problems but actual
01:01:59
damage and disasters shimoth let's look
01:02:02
let's try to look forward here this
01:02:05
obviously has been a cataclysmic chaotic
01:02:09
intense whatever descriptor you want to
01:02:11
use of the past week productive is okay
01:02:14
sure and it certainly created massive
01:02:17
swings in the market is this all going
01:02:19
to cause a recession is this too violent
01:02:23
of an approach to markets that is I
01:02:26
think a valid uh criticism that people
01:02:29
have including you know the majority of
01:02:31
business leaders are saying "Hey I think
01:02:33
I have to start layoffs." You had United
01:02:35
Airlines say "We're not going to give
01:02:36
any guidance." This feels to business
01:02:39
leaders Republican business leaders
01:02:42
primarily and market participants as
01:02:45
just far too chaotic and they can't plan
01:02:48
and if they can't plan then they stop
01:02:50
planning which then is going to cause
01:02:52
layoffs it's going to cause bankruptcies
01:02:54
and uh who knows what the second and
01:02:56
third order consequences are going to be
01:02:58
so what's going to happen here over the
01:03:00
next couple of weeks and months so just
01:03:02
on the recession question and then I'd
01:03:04
like to give an answer to Ezra and Larry
01:03:06
i think that and I've said this for
01:03:07
about a year it was clear to me that we
01:03:10
were sneakily in a recession before and
01:03:14
the reason was the vast amounts of money
01:03:18
and deficits that were being pumped into
01:03:21
government services that perverted the
01:03:24
actual GDP picture in America so as Doge
01:03:27
sort of slows down that money flow and
01:03:32
as the consensus in Congress gets to a
01:03:36
better budget I think that you're going
01:03:39
to see that the government was probably
01:03:41
responsible for 100 to 150 basis points
01:03:43
of just waste and if you take that out
01:03:47
you will technically be in a recession
01:03:49
that was independent of these tariffs
01:03:52
and I think that that's where the true
01:03:53
economy Jason was and I think that we're
01:03:56
going to just find that out so that's
01:03:59
that on where we go from here i can give
01:04:02
you an anecdote and I'll give you a
01:04:03
projection the anecdote is this weekend
01:04:05
my wife and I were in bed and a person
01:04:07
called me very successful businessman
01:04:10
who was representing the president of a
01:04:12
country saying "Hey I need some advice
01:04:14
what do we do here?" And we walked
01:04:16
through the three things that he and his
01:04:19
government that they government were
01:04:20
trying to figure out because they wanted
01:04:22
an off-ramp they were like "I'm ready to
01:04:25
cry uncle we're ready to tap out." And
01:04:29
again he was calling me as a private
01:04:30
citizen but I think this conversation
01:04:32
was very instructive number one he's
01:04:33
like "Look we have these really high
01:04:35
tariffs on inbound American products
01:04:37
we're happy to cut these things to
01:04:38
zero." And I said "Well you should do
01:04:40
that." Second while we were exploring
01:04:43
he's like "Yeah you know we have a
01:04:45
enormous capital purchase with Airbus."
01:04:46
I said "Cancel it swap it to Boeing."
01:04:49
He's like "Done." And then the third
01:04:51
which was interesting is he's like "We
01:04:53
need to import an enormous amount of
01:04:56
energy." And I said "Well who do you
01:04:58
give that concession to right now?" And
01:05:01
it was a non-American company and I said
01:05:03
"Well why wouldn't you just RFP that to
01:05:05
an American business and let them
01:05:07
compete?" And he's like "We'd be open to
01:05:09
that as
01:05:11
well." So he said "You know we're
01:05:13
getting prepared we want to find a way
01:05:14
to talk to the Trump administration."
01:05:16
And I'm like "Great however I can be
01:05:17
helpful I'm help I'll be helpful to
01:05:19
you." I got off the phone and I looked
01:05:20
at my wife and I said "If even 30 of
01:05:23
these 75 countries do a deal anywhere
01:05:26
remotely close to this this was an
01:05:28
enormous win." So let me give you my
01:05:30
projection Jason of what the art of the
01:05:32
deal could be here what you do is you
01:05:35
can rewrite Bretonwoods 2.0 what was
01:05:37
Bretton Woods 1.0 it was fixing exchange
01:05:40
rates it was setting up the IMF it was
01:05:42
setting up the World Bank those were the
01:05:44
conditions on the ground post World War
01:05:45
II it made a lot of sense what would we
01:05:47
do if we had to write the Mara Lago
01:05:49
accords right now i think what we would
01:05:51
do is work backwards from the question
01:05:53
that Ezra asked and the answer that I
01:05:55
gave how do we create resiliency in
01:05:59
these critical markets number one a
01:06:01
framework for that number two is how do
01:06:03
we create limits for government
01:06:06
sponsored intervention against capital
01:06:09
for-profit companies many of whom are
01:06:12
American so that we can actually compete
01:06:14
on a level playing field and then number
01:06:16
three very simply if you can do business
01:06:19
in my country why can I not do business
01:06:21
in yours and I'll just give you that
01:06:22
story for one second i was responsible i
01:06:25
was the head of every single entity of
01:06:28
Facebook outside of the United States i
01:06:29
opened every market my team and I
01:06:33
created a framework for dominating i
01:06:36
figured we figured out how to crack
01:06:37
Brazil India Russia you know the one
01:06:40
market that we never could ever make a
01:06:43
single iota of progress say it Jason
01:06:45
with me well China China China Russia no
01:06:50
Iran we won in Russia so my point is in
01:06:52
every single market except one is it
01:06:54
that we were just lucky in 174 markets
01:06:58
and one we were stupid no so I think
01:07:01
that the moral accords this sort of
01:07:03
Brettonwoods 2.0 is the outcome Ezra it
01:07:05
will basically use tariffs as a way to
01:07:08
get these governments to a table and
01:07:11
allow us to negotiate a much fairer
01:07:14
economic quid proquo here's my concern
01:07:16
with with this theory and I want to
01:07:17
leave out but I'll leave the the sort of
01:07:19
question of what the real economy looked
01:07:21
like to Larry this world in which what
01:07:24
is happening is a business leader who
01:07:25
represents a country is calling you and
01:07:27
saying okay what do we need to do to
01:07:28
deal right they're coming to Donald
01:07:29
Trump and they are going to come to
01:07:30
Donald Trump as Larry said earlier
01:07:32
there's no doubt that the US economic
01:07:35
leverage is enormous and virtually every
01:07:38
country faced with our might is going to
01:07:41
try to cut a deal with us but then
01:07:43
there's a call they're not making to you
01:07:45
that they're making to someone else
01:07:47
which
01:07:48
is we have
01:07:51
allowed or we have approached the US as
01:07:54
a functionally benign partner for a very
01:07:57
long time and now they're becoming a
01:07:59
dangerous partner they are very very
01:08:02
strong and they will use that strength
01:08:05
to crush countries smaller than them
01:08:07
when it suits the whims of a personalist
01:08:10
regime run by a person who his feelings
01:08:15
even about people that the US or
01:08:16
countries the US traditionally
01:08:18
considered allies like Canada or much of
01:08:20
Europe uh change and so yes on the one
01:08:23
hand for the next year or two we want to
01:08:26
avoid getting a big tariff slapped on us
01:08:28
and so we got to figure out what is it
01:08:30
that if we offer it to Donald Trump he
01:08:33
will say to himself that was enough uh
01:08:36
of a give that you know I can move on to
01:08:39
someone else i can make them the the
01:08:41
focus of my eye and on the other hand
01:08:43
they're going to begin to build
01:08:45
fortresses and deals and partnerships
01:08:47
and approaches that make sure they are
01:08:49
less exposed to our ability to wield
01:08:52
this power against them in the future
01:08:54
but before I came on the show I had gone
01:08:56
on X and I saw a clip of you going
01:08:59
around where you were saying that one of
01:09:00
the problems with the Biden
01:09:01
administration was that you couldn't get
01:09:03
anybody on the phone and in the Trump
01:09:05
administration you make the call the
01:09:06
deputy chief of staff picks up you say
01:09:08
"Hey I need you to talk to to this
01:09:10
company they I work with them they're
01:09:11
freaking out about the tariffs the
01:09:13
deputy chief of staff tells the company
01:09:14
they they work something out." No no not
01:09:16
that they work something out they listen
01:09:18
they listen this this world in which we
01:09:22
are doing the dealm by individual
01:09:25
relationships by who can get their calls
01:09:27
answered not by rules that feel clear
01:09:29
and stable that's how the Hold on a sec
01:09:32
but that's how the Biden administration
01:09:33
worked that's not what said that's not
01:09:36
what I said well no Ezra you're trying
01:09:38
to make it sound like corruption hold
01:09:40
on it was George Clooney that was making
01:09:43
the call who cares what George Clooney
01:09:44
thinks didn't you just say on uh well I
01:09:47
was very very critical of Biden
01:09:49
I saw that clip Ezra and what Jamas said
01:09:51
what Jamas said is simply that the White
01:09:54
House listens when he calls whereas he
01:09:57
couldn't get his calls returned by the
01:09:59
Obama administration great i think we're
01:10:02
actually not saying something all that
01:10:04
you made it sound like corruption well I
01:10:06
actually think what Trump is working
01:10:08
through is deal patronage based on how
01:10:12
he sees the company i'm sorry the other
01:10:15
country what happened ezra can I just
01:10:17
make sure that this is clear to you this
01:10:19
is a 150year-old American business i
01:10:22
have no interest in that company except
01:10:24
a friendship these are Americans hiring
01:10:28
Americans trying to compete with China
01:10:30
who were very negatively affected and
01:10:32
all I said was why don't you have a
01:10:34
chance to explain what's happening on
01:10:35
the ground my point that I was trying to
01:10:37
make and maybe I didn't make it clear
01:10:38
enough so let me set the record straight
01:10:40
the Trump administration what I have
01:10:42
seen as a businessman is willing to hear
01:10:44
the conditions on the ground as a
01:10:46
businessman when I was building Ezra
01:10:49
just to be clear critical rare earth
01:10:51
supplies for America under the Biden
01:10:53
administration battery can materials to
01:10:56
compete with China under the Biden
01:10:58
administration AI chips to be the best
01:11:00
inference solution under the Biden
01:11:02
administration i couldn't get a call
01:11:04
back that's just the facts not because I
01:11:08
wanted anything just to tell them what
01:11:10
was going on
01:11:12
so fair enough insane okay fair enough i
01:11:15
I am not telling you that the B
01:11:17
administration shouldn't have returned
01:11:18
your calls what I am saying is that the
01:11:21
degree to which Trump first and then
01:11:24
everybody around him as an example of
01:11:26
him because culture comes from the top
01:11:28
is working off this kind of individual
01:11:30
call and deal making worries me because
01:11:33
I believe that you had every one of
01:11:35
these calls you're saying and they went
01:11:36
exactly the way you say they went and
01:11:39
then the calls that you are not getting
01:11:41
and they are two minutes ago Ezra you
01:11:43
were saying that a 10% across the board
01:11:45
tariff was too broad and we need to go
01:11:48
industry by industry and now you're
01:11:49
saying that it's going to be too
01:11:51
particular and he shouldn't do country
01:11:52
by country negotiations the word
01:11:54
dealing people listening to people is
01:11:57
not deal making Ezra it's just listening
01:11:59
to people are you really going to be
01:12:01
tell me that the way Trump himself works
01:12:04
is not individual deal
01:12:06
making people with
01:12:10
Is this really is this really the
01:12:12
argument here i will tell you what I've
01:12:13
seen and David's seen much more what I
01:12:16
have seen from the president is he takes
01:12:18
in hundreds of opinions and starts to
01:12:21
figure out what the ground truth is and
01:12:24
the reason is when you only listen to
01:12:25
one or two every president probably
01:12:28
deals with this you have this
01:12:30
information asymmetry problem because
01:12:31
you are the president of the United
01:12:33
States and so how do you cut through it
01:12:35
you talk to hundreds and hundreds of
01:12:37
people and you triangulate what the
01:12:38
truth is so it's not like he's giving
01:12:41
any favor he's collecting information
01:12:43
that is a good process you want the most
01:12:45
powerful person in the world to get to
01:12:47
the ground truth go ahead Larry
01:12:50
i am all for information gathering i
01:12:54
agree that the Biden administration did
01:12:58
not do a as good a job as it could have
01:13:00
of maintaining relations with the
01:13:02
business community i agree that it's a
01:13:05
good idea for there to be quite
01:13:07
extensive connection
01:13:10
i am also appalled by the halfozen phone
01:13:14
calls I have gotten from prominent
01:13:17
people in business who have said "I'm
01:13:20
used to being shaken down when I try to
01:13:24
do business in some parts of the world."
01:13:27
It's a new experience to be shaken down
01:13:30
by representatives of the president of
01:13:32
the United States what's the shake down
01:13:35
when you have close connections you help
01:13:38
us you contribute this way you no sense
01:13:41
at all makes no sense what the president
01:13:43
has been trying to do is encourage
01:13:47
domestic maybe it is an erroneous
01:13:50
perception to which I have been exposed
01:13:53
repeatedly but it is total nonsense but
01:13:56
it is a pervasive total nonsense you
01:13:59
guys are very confident that your true
01:14:01
and everybody else's aren't it is a
01:14:03
perception that is shared by almost
01:14:07
everyone who has experience in the
01:14:09
conflict of interest area who has looked
01:14:12
at the situation of Trump administration
01:14:17
officials and those working as special
01:14:19
government employees in the Trump
01:14:22
administration what are you saying so I
01:14:24
just went through that whole process
01:14:25
Larry it will be false but I can speak
01:14:28
to this cuz I just went through this
01:14:30
process it took forever it took like
01:14:32
months okay i went through the same
01:14:35
process everyone else goes through the
01:14:36
OGE career staff have to go through all
01:14:38
of your disclosures and they figure out
01:14:40
what the conflicts are and then you have
01:14:42
to devest them okay it's the same
01:14:44
process everyone goes through so you're
01:14:47
all over the place making all sorts of
01:14:48
accusations here so if you have some
01:14:50
proof or you want to accuse someone then
01:14:52
why don't you just do it but otherwise
01:14:54
what you're saying is just not true it's
01:14:56
not backed up by anything great they
01:14:57
shut down Eric Adams that's my That's a
01:14:59
direct accusation that happened in
01:15:00
public they shook down Eric they shook
01:15:02
down Eric Adams because they put him in
01:15:04
his pocket that's a big deal y'all like
01:15:06
that is the way they are doing business
01:15:08
here you guys are all over the map
01:15:11
making wild accusations first it was a
01:15:15
second resations because of their
01:15:19
discomfort with being overruled by your
01:15:23
colleagues in the Trump administration
01:15:26
so the suggestion over the map you have
01:15:28
been held to the same ethical standards
01:15:30
that I was held and that other members
01:15:33
of previous administrations including
01:15:36
the Bush administration were held
01:15:38
unfortunately is not right no that's
01:15:42
that's false all right well there's two
01:15:44
issues you may not be familiar but I had
01:15:47
to devest hold on i had to devest a lot
01:15:49
as I talked about on this show in any
01:15:51
event you guys are all over the map
01:15:52
making wild accusations two seconds ago
01:15:55
the shakeddown was at the level of
01:15:56
companies then all of a sudden it was OG
01:15:58
and ethics then it was something about
01:16:00
Eric Adams integrated business it's
01:16:03
nobody's making I like that you're like
01:16:04
"Who's Eric Adams?" We're not making I
01:16:06
know who Eric Adams is i supported him
01:16:08
on this show forward way that Trump does
01:16:11
business at every level at which he
01:16:13
operates and so it is happening at every
01:16:15
level of his administration you know I
01:16:17
got to say I don't It's not that I It's
01:16:19
not that I don't want to hear you i
01:16:21
don't want to hear it you know how this
01:16:23
started is because Hold on a second Ezra
01:16:26
you misqued something Chamas said on
01:16:28
another podcast where all he said was
01:16:30
that I can get my phone calls returned
01:16:32
by this White House where I couldn't
01:16:33
with Obama or Biden even though I was a
01:16:36
big donor hold on and you guys have
01:16:38
somehow morphed that into some sort of
01:16:40
like broad ranging accusations of
01:16:43
corruption or something like that no
01:16:45
evidence clear about what the accusation
01:16:48
of the way Donald Trump works is ezra
01:16:51
your accusation of me tried to infer
01:16:53
some form of corruption or some form of
01:16:55
dealmaking none of that happened what I
01:16:56
what I again I'll tell you I connected
01:16:59
the White House so they could hear on
01:17:00
the ground what's happening from a
01:17:02
company who was very negatively impacted
01:17:04
by the tariff so that they had the
01:17:06
complexion of that feedback as well okay
01:17:08
do you deny the possibility that your
01:17:10
experience with the Trump administration
01:17:12
might be different than people who they
01:17:13
feel are less allied to them than you
01:17:14
are ezra I'm will I'm willing a
01:17:16
straightforward question what are you
01:17:18
sure that you're a good sample i don't
01:17:21
even know what we're talking about
01:17:22
anymore also I think what we're talking
01:17:24
about right now is that people who
01:17:26
donate to politicians have unique access
01:17:28
to politicians i think we can all agree
01:17:30
that's not true just to be very clear I
01:17:32
give I have given way more to the
01:17:35
Democrats than I've given to Donald
01:17:36
Trump and you were disappointed about
01:17:38
that i didn't say anything about your
01:17:39
donations said about where your ally now
01:17:42
and by the way like what what's crazy is
01:17:44
I was the same intellectual person I was
01:17:46
under Biden that I am under Trump it's
01:17:48
just that it seems like the Trump
01:17:49
administration is like "Well this is a
01:17:51
smart guy with some opinions let me
01:17:52
listen." Biden I And by the way and
01:17:54
Larry you and you know this these were
01:17:56
some very close friends of ours that we
01:17:58
share mutually that would not even
01:18:00
return my calls so it is a little
01:18:02
personal for me as well Ezra just to be
01:18:04
honest with you i'm not going to go
01:18:05
there but the point is that's fair i
01:18:06
have never I have never seen a single
01:18:10
iod of any form of anything other than
01:18:14
just gathering information from the
01:18:15
Trump they've never asked me for
01:18:17
anything they've never tried to direct
01:18:18
me to do anything they just want to know
01:18:20
what's going on when you ask them hey
01:18:22
can you talk to such and such a person i
01:18:24
can assure you that your experience is
01:18:26
not the experience of quite a number of
01:18:30
the nation's major law firms it is not
01:18:33
the experience of quite a number of the
01:18:35
nation's business leaders it is not the
01:18:37
experience of quite a number of um the
01:18:42
nation's uh
01:18:44
universities
01:18:46
that I am neither the first nor the
01:18:50
hundth person referencing efforts at
01:18:53
extortion to use the movie The Godfather
01:18:57
as a metaphor for the for aspects of the
01:19:00
way in which our country is uh being uh
01:19:05
governed what a surprise democratic
01:19:07
universities and Democratic law firms
01:19:08
are making accusations
01:19:11
all right let's move on we think we've
01:19:13
the tariff issue and I think we can all
01:19:15
agree that if you donate money you might
01:19:17
have better access to politicians i want
01:19:19
to talk about the future especially
01:19:20
Jason if you give 10% to the big guy
01:19:22
then you really get access listen we can
01:19:24
we can do these allegations if you you
01:19:27
know yeah there's a long list of people
01:19:29
who've made donations and there's a long
01:19:31
list of favorable things that have
01:19:33
happened to them after across all
01:19:35
administrations and we can debate cause
01:19:38
and correlation all day long here but I
01:19:40
wanted to talk about the future of the
01:19:42
Democratic party while we're here Ezra
01:19:44
you have been on a tour talking about
01:19:49
exactly how incompetent how terrible of
01:19:52
a campaign they ran what is the future
01:19:55
and I'll let Larry get you know his uh
01:19:57
his two cents in here as well is there
01:19:59
any saving this party and if so what
01:20:02
would it look like well well there's a
01:20:03
the problem of the party and the
01:20:05
campaign let me bracket that cuz so my
01:20:06
book Abundance is more about how
01:20:08
Democrats govern at both the state and
01:20:10
and local and federal level and some of
01:20:12
the pathologies of governance there they
01:20:14
make it hard for for liberals to achieve
01:20:16
their goals there are versions of this
01:20:17
on the right but I'm not really writing
01:20:19
about that in in this so my book
01:20:21
Abundance Derek Thompson is about the
01:20:23
tendency Democrats have to subsidize
01:20:26
things where they are choking off the
01:20:27
supply of the thing they want people to
01:20:30
have more of so think about housing in
01:20:32
California to get rental vouchers from
01:20:33
the federal government but we make it
01:20:34
incredibly hard to build homes clean
01:20:36
energy which a lot of the B
01:20:38
administration's policies were about
01:20:40
putting huge subsidies behind the
01:20:42
building of more clean energy but they
01:20:44
didn't really do anything to make the
01:20:45
permitting the sighting the state
01:20:48
capacity to do all of that uh capable of
01:20:50
building that amount of of clean energy
01:20:53
at the pace they foresaw us building it
01:20:55
right that they wanted us to build it
01:20:58
and behind this and and I can sort of go
01:21:00
into a lot of detail here but is a a
01:21:02
diminishment of state capacity that
01:21:04
comes from wrapping the state itself in
01:21:07
red tape and regulation i think we think
01:21:09
and have an intuitive way of thinking
01:21:11
about the idea of deregulation on the
01:21:14
private sector right when the government
01:21:15
is imposing regulations on private
01:21:17
companies and it's making it hard for
01:21:18
those companies to act to do business
01:21:21
etc but this happens first and foremost
01:21:23
on the government itself one of my
01:21:25
favorite examples I've been using lately
01:21:27
there's a new Rand report that looks at
01:21:29
how much it costs to construct a square
01:21:31
foot of housing in California in Texas
01:21:34
and Colorado and it does it on two kinds
01:21:37
of housing market rate and it does it on
01:21:39
affordable housing subsidized by the
01:21:41
public sector and the cost of creating
01:21:44
housing in California market rate is 2x
01:21:46
in California what it is in Texas but
01:21:49
when you get into that publicly
01:21:50
subsidized housing where you have all
01:21:53
these new standards and rules and
01:21:55
regulations being triggered by the
01:21:57
addition of public money it goes up to
01:21:58
about 4.4x and so you have this real
01:22:02
problem I think in a way of governing
01:22:04
that evolved in the 70s the '8s there's
01:22:07
a kind of small government version of
01:22:09
the Democratic party the new left more
01:22:11
individualistic that was worried about
01:22:13
too much exercise of government power
01:22:16
and now that we are in a different world
01:22:19
with different problems we're thinking
01:22:20
about re-industrializing we have a
01:22:22
housing shortage and you have things
01:22:24
like the Biden administration which
01:22:25
really are thinking about how to build a
01:22:26
lot more in America but you don't have
01:22:28
either a policy architecture or I would
01:22:31
say a governing culture that makes that
01:22:34
possible yeah and and so a lot of this
01:22:36
came from Francis Fukayyama I think uh
01:22:39
and vto votocracy vtocracy how do you
01:22:41
pronounce fukyama is a great sort of
01:22:43
related concept of vetocracy which is
01:22:45
that he also got another great concept
01:22:47
since we're bringing up fukyama which is
01:22:49
that neoliberalism which we've sort of
01:22:51
been talking about here with the WT and
01:22:52
other things he says people think about
01:22:54
it as the veneration of the market but
01:22:56
what it is first and foremost is the
01:22:58
degradation of the state and I think
01:23:00
that explains a lot more about the world
01:23:02
we're in than people recognize ezra you
01:23:03
can agree with this francis Fukuyama is
01:23:05
probably one of the most polarizing
01:23:07
modern academics in America as you read
01:23:10
him people end up in they're very pro-
01:23:12
Fukuyama or they think Fukyama because
01:23:14
Yeah i mean look cuz cuz what happened
01:23:16
is I mean just to uplevel this for a
01:23:18
second is that you you had Fukuyama
01:23:19
write the end of history which basically
01:23:21
said that democratic capitalism is the
01:23:23
end- all beall and we're basically down
01:23:25
to one system and the whole world's
01:23:27
going to run on that system and that
01:23:29
philosophy then animated I would say a
01:23:33
neoliberal and neoonservative consensus
01:23:36
in Washington for 25 years and there
01:23:38
were three key pillars of that let's
01:23:40
call it globalist consensus number one
01:23:42
we'd have open borders free flow of
01:23:45
labor in fact the Wall Street Journal
01:23:47
editorial page which you know is
01:23:49
considered to be conservative actually
01:23:50
supported a constitutional amendment
01:23:52
saying that we'd have open borders
01:23:54
number two we'd have open flows of trade
01:23:56
and capital so basically the unfettered
01:23:59
free trade agenda and then number three
01:24:01
the third leg of it was Pax Americana we
01:24:03
had deploy American troops all over the
01:24:05
world to defend this consensus because
01:24:07
they'd be greeted as liberators not
01:24:09
occupiers i think all three pillars have
01:24:13
been refuted and the the person who has
01:24:17
represented the shift in this consensus
01:24:20
to I'd say a new agenda of economic
01:24:23
nationalism and geopolitical nationalism
01:24:26
is Donald Trump okay wow i was going to
01:24:28
guess that when you have listen when you
01:24:33
have violence end of history and the
01:24:35
last man is a much more complicated
01:24:37
question at a very high level let me
01:24:38
finish the point here cuz I'm kind of on
01:24:40
a roll here yeah keep wrap bring it home
01:24:43
when you have a bipartisan
01:24:45
consensus that included both Bush
01:24:48
Republicans and Clinton Democrats around
01:24:50
these three pillars of
01:24:52
globalism and then I'd say that country
01:24:55
turns against that that's not going to
01:24:57
be a smooth process that is going to be
01:25:00
potentially a violent process it's going
01:25:01
to be a disruptive process
01:25:04
and you guys want to raise like all
01:25:05
these nit objections and pro or whatever
01:25:08
donald Trump is bringing that
01:25:09
realignment but the real question the
01:25:12
real question is was that consensus
01:25:14
correct or was it a failure i would
01:25:16
argue as a failure larry let me ask you
01:25:18
a question then when you see something
01:25:20
like Doge happening and people start
01:25:22
taking a bit of a a more unilateral a
01:25:25
quicker a less veto based approach is
01:25:29
that encouraging to you Larry do you
01:25:31
think that's the right way to do it
01:25:32
because we haven't been able to get the
01:25:34
government smaller since Clinton so are
01:25:37
you pro Doge not Doge and do you think
01:25:39
this sort of objection to hey we're
01:25:41
going too fast too violently maybe
01:25:43
that's what we need to do at times and
01:25:45
then I'll go back to you Ezra to answer
01:25:46
the same question i think that Ezra is
01:25:49
broadly right about the pro promiscuous
01:25:53
distribution of the veto power he's
01:25:55
broadly right that we need to be able to
01:25:58
do more things more quickly in the state
01:26:03
if we're to be an effective government i
01:26:06
think we need much more reform i think
01:26:09
Democrats have allowed
01:26:12
themselves excessively to become hostage
01:26:15
to particular groups particular
01:26:20
traditional uh concerns and have lost
01:26:24
touch in important ways with an American
01:26:28
mainstream and I think that in so far as
01:26:31
the election outcomes in recent years
01:26:33
have not been what they wanted that is
01:26:36
an important contribution to how that
01:26:38
has happened and I agree with David that
01:26:42
Donald Trump represents a
01:26:45
transformative and profoundly different
01:26:49
ideology than has been present in
01:26:51
governing America before
01:26:54
i do believe that it is
01:26:59
fundamentally not new under the sun just
01:27:03
new in America that it is the Juan Peron
01:27:08
approach which is very familiar to
01:27:11
students of Latin American uh history in
01:27:16
particular and that the general
01:27:19
experience of that approach is that its
01:27:23
leaders particularly when they have
01:27:25
galvanizing
01:27:27
personalities can be very popular for a
01:27:31
substantial period of time but that they
01:27:34
are very rarely
01:27:36
remembered well by historians of their
01:27:40
countries and so my best judgment is
01:27:44
that this
01:27:46
project
01:27:48
is going to end in disastrous
01:27:52
failure despite having put its finger on
01:27:56
some important
01:27:58
concerns and issues of course there
01:28:02
should be much more aggressive reform of
01:28:05
the government than there is but that
01:28:08
does not
01:28:11
excuse or mean that it is likely to work
01:28:14
out well
01:28:16
for some of the mindless
01:28:20
savagery that the Doge is bringing to
01:28:24
traditional American institutions uh is
01:28:28
going to work out Well and to take just
01:28:31
one example my belief is that the
01:28:36
revenue
01:28:37
loss from the Doge's
01:28:41
destruction
01:28:43
of significant part of the functioning
01:28:46
of our nation's tax collection system is
01:28:49
likely to exceed in terms of
01:28:52
contributing more to the deficit than
01:28:56
any
01:28:57
savings realized what do you mean by
01:28:59
what do you mean by that what is this
01:29:00
they've identified the right thing but
01:29:02
they're executing on it too much go
01:29:04
ahead Shim no no I have two questions
01:29:05
Larry just tactically what do you mean
01:29:07
by the destruction of the revenue
01:29:09
collecting mechanism that's question
01:29:10
number one which was just I just want to
01:29:12
understand what you meant a second
01:29:14
question which is more broadly if Larry
01:29:16
if you were president for a day just
01:29:19
give us the Larry Summers plan like what
01:29:22
is the counterfactual to what's
01:29:24
happening now you can include tariffs
01:29:26
you can include Doge i just want to
01:29:28
understand how you would frame the
01:29:31
solution to what hils us so maybe
01:29:34
tactically just talk about the the
01:29:36
collections part because you referenced
01:29:37
it and then just more strategically what
01:29:40
the Larry Summers 2.0 plan is
01:29:43
we are firing on
01:29:46
mass people whose job it is to audit
01:29:50
people like you and the result of that
01:29:54
is that we are losing revenue
01:29:57
directly we are losing revenue further
01:30:00
because people once audited go straight
01:30:03
in subsequent years and we are losing
01:30:07
revenue because more and more people are
01:30:08
playing the audit lottery engaging in
01:30:11
problematic practices in the expectation
01:30:15
can I burst your bubble on this that
01:30:17
they will not that they will not be
01:30:19
caught let me tell you my experience i
01:30:21
get audited every year automatically and
01:30:24
the reason you get audited every single
01:30:26
year is typically the way that you
01:30:27
acquire your wealth creates complexity
01:30:31
700 800
01:30:33
900page tax filings now you don't do
01:30:36
that yourself what happens is you
01:30:38
typically pay a large big four
01:30:40
accounting firm millions of dollars to
01:30:41
do it deote PWC Anderson
01:30:46
etc every year that I've been audited
01:30:48
the biggest delta has been about a
01:30:51
thousand bucks in this case I actually
01:30:53
was owed a,000 by the US government last
01:30:56
year which was what you spend it on
01:30:57
incredible i'll spend it everywhere so
01:31:00
Larry just so you know I'm well aware of
01:31:02
everything you just said and I have no
01:31:04
doubt about your personal integrity fact
01:31:08
you think it is less than a quarter of
01:31:10
people with incomes over $10 million are
01:31:13
audited so it's just it's just not true
01:31:17
let me ask you that everybody not true
01:31:20
that everybody is uh that everybody is
01:31:22
audited i get the sense Larry you're you
01:31:25
like Doge but you don't like the
01:31:26
execution got it ezra you talk about
01:31:29
your book we got to move faster we got
01:31:30
to do things faster we got to take more
01:31:32
risk so are you pro doge or not and if
01:31:35
you look at the Democratic if you look
01:31:37
at this administration I'm going to call
01:31:39
it Trump 2.0 for clarity these are I
01:31:42
would say two out of three people around
01:31:44
Trump whether it's Chamont Joe
01:31:46
Rogan Bessant Howard even uh Trump
01:31:51
himself are Clinton Democrats so it's
01:31:54
basically the Clinton you were going to
01:31:56
say yourself what i don't matter ezra
01:31:59
are you happy about Doge your book seems
01:32:02
to be a plan to do like things
01:32:06
i think building state capacity is two
01:32:08
dimensions one is what the state can do
01:32:11
and the second is the rules under which
01:32:13
it doesn't doge seems to me to be
01:32:16
fundamentally destructive of state
01:32:17
capacity first and this goes again to my
01:32:20
endless frustration that I feel like
01:32:22
goals are not clearly laid out in the
01:32:23
Trump administration what are the
01:32:25
measures we are looking at and how will
01:32:26
they achieve them is it just trying to
01:32:28
cution they've been very But that's not
01:32:30
efficiency right i could save a trillion
01:32:32
dollars no I could save a trillion
01:32:35
dollars in ways that will make the it
01:32:37
let's put it this way what Larry was
01:32:38
just saying right if you cut everybody
01:32:40
at the IRS right just cut every single
01:32:43
one of them on the Doge measure of how
01:32:46
much did you save in headcount that will
01:32:48
look like it counted up towards your
01:32:50
save a trillion dollars goal but in
01:32:52
terms of what Larry is saying which is
01:32:53
the long-term efficiency of US tax
01:32:55
collections you'd have just made the IRS
01:32:57
much much much less efficient no no we
01:32:59
get that but they've also cut all these
01:33:02
software and consulting
01:33:04
nonsense stuff i am not going to tell
01:33:06
you that there are zero Doge cuts that
01:33:09
made sense but I am going to say that
01:33:11
what I see them doing overall is highly
01:33:13
destructive state capacity or similarly
01:33:15
a lot of things happening around USAD
01:33:16
and say PEPAR funding um is PEPAR
01:33:19
efficient i mean yes you save money by
01:33:22
not giving HIV retrovirals to children
01:33:25
in Africa but I think it is good that
01:33:27
you do that right so that's not the kind
01:33:28
of efficiency I'm looking for i am
01:33:30
interested in state capacity that is
01:33:34
connected to achieving specific goals
01:33:36
i've talked to a bunch of the people
01:33:37
around Doge and again here you get a lot
01:33:39
of different ideas of what the goals are
01:33:41
some people say well what we're trying
01:33:42
to do is save money but if what you
01:33:44
wanted to do is save money you could say
01:33:46
go to Congress and do a very big bill
01:33:49
there was a lot of interest in Congress
01:33:50
people like Roana who wanted to work
01:33:52
with Doge to identify big spending cuts
01:33:55
that both sides could agree on defense
01:33:57
being a big being a big piece of this
01:33:59
and then they decided not to do it so
01:34:00
Doge to me uh is a it would be great if
01:34:04
somebody tried it but I see this as much
01:34:06
more of a destruction of state capacity
01:34:08
and a hacken slash operation larry
01:34:11
Summers we're going to thank you for
01:34:12
coming i know you've got to uh drop off
01:34:14
right now thank you wait what about
01:34:16
Larry Summers 2.0
01:34:18
would you like to do your Larry Summers
01:34:20
you're Yeah before you leave I want to
01:34:22
know what the counterfactual is yeah
01:34:24
what's your plan Larry
01:34:26
counterfactual is focus on necessary
01:34:30
strategic investments in
01:34:34
infrastructure in making America the
01:34:37
leading country unambiguously in the
01:34:39
world in technology particularly
01:34:42
disseminating in large scale artificial
01:34:46
intelligence for collective uh benefit
01:34:51
building a larger network of alliances
01:34:56
so that we are in a position to counter
01:34:59
China both with hard power in the form
01:35:03
of increased military expenditures and
01:35:06
with moral strength and the world as a
01:35:10
whole uh as a whole behind us as a
01:35:16
central organizing theme of uh foreign
01:35:20
policy
01:35:22
and
01:35:24
reinvent our education system at uh
01:35:28
every level to pick up on Ezra's notion
01:35:32
of being about results and doing all of
01:35:35
that while you're doing the abundance
01:35:38
agenda as uh well of freeing stuff up so
01:35:44
that we're in a position uh for
01:35:47
governments to get things
01:35:50
done i believe the country is best
01:35:53
governed from the center not best
01:35:58
governed from a
01:36:02
radical fringe and I believe moving to a
01:36:07
transactional model of
01:36:10
leadership is the approach of Latin
01:36:15
American strong men and history does not
01:36:19
find it to be a
01:36:21
successful model and so I would venerate
01:36:27
rather than denigrate the rule of law as
01:36:30
part of governing the country all right
01:36:32
there you have it folks larry Summers
01:36:34
appreciate you coming on the pod thank
01:36:36
you Larry spicy spicy episode here sax
01:36:40
you wanted a chance to respond on the
01:36:42
Doge issue as as we wrap wow pretty
01:36:46
productive episode yeah let me um let me
01:36:49
partially agree with Ezra here i mean I
01:36:51
think that uh he's trying to introduce
01:36:53
this idea of an abundance agenda to the
01:36:54
Democrat party i think that's a good
01:36:56
thing you know I I know you've talked
01:36:58
about permitting reform and not tying up
01:37:01
projects and so many hoops and so much
01:37:04
environmental regulation and you know
01:37:06
even DEI and all this kind of stuff so I
01:37:09
think that is all well and good i mean
01:37:11
we should we should do those things the
01:37:13
thing that I take issue with is that
01:37:17
you're on the one hand saying that
01:37:20
there's way too much process around just
01:37:23
getting things done right when you're
01:37:25
talking about public works but the
01:37:27
objection you're making to Elon is that
01:37:30
he's not following enough process you
01:37:32
know it's not enough
01:37:33
nicities larry called it mindless
01:37:36
savagery this is the problem is how do
01:37:39
you expect anything to ever get done the
01:37:41
reason why your public works projects
01:37:42
don't happen is because there's too many
01:37:44
special interests who get organized and
01:37:46
they stop it okay what Elon is trying to
01:37:48
do we have a $2 trillion annual deficit
01:37:52
he's trying to figure out how to cut it
01:37:54
every single program that gets cut the
01:37:57
interests who receive that money and we
01:37:59
found out that it's hopelessly corrupt
01:38:01
you know Stacy Abrams gets uh $2 billion
01:38:04
for her nonprofit and you have all these
01:38:06
NOS's who are basically cashing in
01:38:08
they're all going to do everything in
01:38:09
their power to stop those cuts from
01:38:12
happening and they're the ones who are
01:38:14
jinning up this hysteria you know
01:38:16
burning down car dealerships and so
01:38:18
forth and so on so this is the problem
01:38:21
that I see is that you don't really have
01:38:24
a kind word to say for the people who
01:38:26
are actually getting things done who
01:38:28
actually are reforming things elon is
01:38:31
one who's actually making difference can
01:38:33
you can you find any good in this i mean
01:38:36
you you sound like you're cherrypicking
01:38:38
you when when I brought it up and I
01:38:39
questioned you like "Do you support
01:38:40
Doge?" Your first thing is to say like
01:38:42
"Well here's my favorite pet projects i
01:38:44
want to keep those." But yes right like
01:38:46
this is I think really important and
01:38:48
weirdly it's the through line of almost
01:38:50
everything I've said on the show today
01:38:53
knowing what you are trying to achieve
01:38:55
is the first part of achieving it so if
01:38:58
Doge is cutting things that I think do
01:39:00
good in the world I'm not going to say
01:39:01
"Hey look they're making the government
01:39:03
more efficient we no longer have a you
01:39:05
know a strong uh foreign aid program or
01:39:07
whatever it might be they've destroyed
01:39:08
the Department of Education without
01:39:10
knowing what they're cutting there." I
01:39:11
don't think Doge is doing a good job
01:39:13
because I don't think they have in a in
01:39:15
a thoughtful way connected means and
01:39:17
ends and weirdly my critique often of
01:39:20
Democrats is also that they have not
01:39:22
been outcomes focused they've been
01:39:24
process focused so David's point here is
01:39:26
actually not been the critique I've made
01:39:28
here i would make procedural criticisms
01:39:30
of Doge but there's a world in which my
01:39:33
take on Doge is look I agree with what
01:39:36
they are trying to do but I wish they
01:39:37
would follow the law but that's not my
01:39:40
take on Doge you have to pick Kla Harris
01:39:42
continuing the spending that was going
01:39:44
on or Elon and Doge cutting which would
01:39:46
you choose i would absolutely I would
01:39:48
absolutely prefer the Kla Harris
01:39:49
administration to the Trump
01:39:51
administration would I like to see
01:39:52
Democrats be significantly more
01:39:54
reformist yes I've written a book about
01:39:56
it i'm trying to persuade them of of
01:39:57
this argument but your book is about
01:39:59
getting rid of this red tape and you
01:40:01
just said you want to keep the people
01:40:03
who put
01:40:03
us hold on you just you you say you want
01:40:07
change this is radical change i agree
01:40:11
but you just said you would rather have
01:40:13
had the person and the administration
01:40:15
that put 9 trillion on top of this this
01:40:18
is why you'll never get that change ezra
01:40:20
you guys all invited me here you'll
01:40:21
never get the abundance agenda that you
01:40:23
want because it's people like Elon or
01:40:26
Trump who get things done this is the
01:40:29
way that politics work you have to have
01:40:31
a paradigm shift to get what you want i
01:40:32
think getting dumb things done is not
01:40:35
good change right i I I I actually don't
01:40:37
understand how this point is so hard to
01:40:40
gro if you get a lot of change and the
01:40:42
change is bad I'm going to think that is
01:40:44
bad not good i would hope that is true
01:40:47
for all of you that if Kla Harris or
01:40:50
some other Democrat came in and began
01:40:52
wrecking things that you wouldn't say
01:40:54
well we needed a bunch of change like
01:40:55
let's break everything in sight i want
01:40:58
to see things done well there should be
01:41:00
good permitting reform so let me give
01:41:02
you let me give you an example of the
01:41:03
kind of thing that I am looking for we
01:41:04
talked about chips a bunch on this show
01:41:06
i like the chips act i did a big piece
01:41:09
that coined the term everything bagel
01:41:10
liberalism about the way in which the
01:41:12
ideas inside that act when they began
01:41:14
building out the grant program layered
01:41:16
on too many standards and and programs
01:41:18
and so on but one thing they then did
01:41:21
was they passed a bill or Biden signed a
01:41:24
bill by Ted Cruz and Mark Kelly uh
01:41:26
taking chips out of the normal uh
01:41:29
environmental review because they said
01:41:31
look if this is a matter of national
01:41:33
security and we're trying to build these
01:41:34
semiconductor fab so quickly we cannot
01:41:37
have this layered in years of
01:41:39
environmental review which now take on
01:41:41
average 3 and 1 half to four and a half
01:41:42
years so because I care a lot about
01:41:44
clean energy one of my arguments is that
01:41:47
we should have a speedrun for clean
01:41:48
energy it should not go through the
01:41:50
normal levels of review what is
01:41:52
happening in California highspeed rail
01:41:53
where it had 12 years of environmental
01:41:55
review was not in my view a good idea at
01:41:57
the same time that doesn't force me to
01:41:59
say well I think we should build a bunch
01:42:00
of coal plants without environmental
01:42:01
review because I can make distinctions
01:42:04
between things I want to see happen in
01:42:05
the world and things I don't i think
01:42:07
you're totally right with that let me
01:42:08
give you the more practical day-to-day
01:42:10
example because those are these
01:42:12
albatross projects that are largely a
01:42:15
byproduct of ineptitude and corruption
01:42:18
but let me tell you a more tactical
01:42:20
example so that you can understand why
01:42:23
what Elon and Trump are doing is so
01:42:26
necessary so as I told you in 2020 on
01:42:30
the back end of COVID I started a
01:42:32
business to build battery cathode active
01:42:35
material in the United States okay so
01:42:37
that's a business we need so that when
01:42:40
you want to electrify everything you
01:42:41
want to electrify there are batteries
01:42:43
that we can make that's not reliant on
01:42:44
the Chinese supply chain it made sense
01:42:48
the guy that I started it with worked
01:42:50
for Elon the other guy I started it with
01:42:52
was a professor at Stanford and the
01:42:53
third guy I started it with was the head
01:42:55
of battery engineering at Toyota a more
01:42:58
complete group of people I think you
01:43:00
couldn't put together so we start to
01:43:02
build we get a deal with General Motors
01:43:04
so far so good but eventually you hit a
01:43:07
point where in order to really
01:43:09
commercialize you need some form of
01:43:11
government acknowledgement that you're
01:43:12
good and the way that you do that is you
01:43:14
apply to the DOE and the DOE has a very
01:43:17
legitimate grant program that tries to
01:43:20
accelerate these key things especially
01:43:21
things that are critical we went through
01:43:23
that program Ezra we paid a couple
01:43:26
million dollars in consulting fees to
01:43:27
the people that we were told to pay it
01:43:29
to and we were rejected okay fine kept
01:43:33
going i kept funding the business and
01:43:35
then next year last year we applied
01:43:38
again 125 companies applied 25 were
01:43:42
shortlisted we all went through
01:43:44
incredible diligence we won incredible
01:43:48
validation at the end of that entire
01:43:50
process so really two years from when I
01:43:52
started and millions of dollars we got a
01:43:55
hund00 million federal grant from the
01:43:56
DOE and $50 million from Michigan to
01:43:59
build a plant in Michigan to help
01:44:03
redmesticate battery cam in the United
01:44:07
States it turned out that in that same
01:44:10
period while we were going through that
01:44:12
rigomearroll Stacy Abrams got $2 billion
01:44:15
after 30 days and I just asked the
01:44:19
question what is broken inside of the
01:44:21
government that that's possible that us
01:44:24
it's hopelessly corrupt that's exactly
01:44:26
right a company of 50 people 50 people
01:44:30
where none of this money goes into our
01:44:32
pockets we take that money and we then
01:44:34
have to raise more money i have to put
01:44:36
in more money we try to hire people we
01:44:38
try to build a battery factory that can
01:44:41
basically give us resilience against the
01:44:43
Chinese which I think is great they're
01:44:45
an incredibly forward you know strong
01:44:47
and viable
01:44:49
competitor in 30 days she got 20 times
01:44:52
more than we did how do you explain it
01:44:54
so here's what I'll say on here's what
01:44:56
I'll say on the two things and how do
01:44:57
you fix it i have not myself looked
01:44:59
deeply into the Stacy Abrams story but
01:45:01
I'm very skeptical of the accounts I
01:45:02
keep hearing about it i suspect that if
01:45:04
she had made $2 billion in 30 days she
01:45:06
wouldn't be now hosting a podcast on
01:45:08
crooked media she'd be on an island
01:45:10
somewhere so I can't comment on that
01:45:11
piece of crooked media yeah what I Yeah
01:45:13
the America thing it's a joke from
01:45:17
Donald Trump actually i don't know the
01:45:20
broader thing here though right which is
01:45:22
you're getting at you're frankly what I
01:45:24
worry about is that what you had in that
01:45:26
DOE process was fairly quick for the
01:45:28
government one of the things that I am
01:45:30
targeting in the book is a way that even
01:45:32
when members of the administration when
01:45:36
governors want things to happen they are
01:45:39
not willing to upend the process to pass
01:45:42
the new bills to reconstruct the
01:45:44
architecture of the federal or the state
01:45:46
government to get it to happen jerry
01:45:48
Brown and Gavin Newsome wanted highspeed
01:45:50
rail can't you acknowledge Can't you
01:45:52
acknowledge it's insane that somebody
01:45:53
can get $2 billion after 30 days i I I
01:45:57
am not going to acknowledge a story I
01:45:59
have not looked into myself because I'm
01:46:00
not sure I trust the account of it i
01:46:02
don't think it's I don't think it's
01:46:03
crazy i don't think it's crazy to get
01:46:05
the money after 30 days but it depends
01:46:07
on whether or not the process was good
01:46:08
hold on i want I want to stop before you
01:46:10
guys move around to a bunch of like
01:46:11
random people the thing that I want to
01:46:14
stay on with abundance for a minute here
01:46:16
is that the thing that I think would be
01:46:17
useful to do is actually build
01:46:20
legislation to make these processes work
01:46:22
more quickly with more discretion from
01:46:25
decision makers and then oversight after
01:46:27
the fact rather than heavy process
01:46:29
before the fact i was talking to
01:46:30
somebody highly involved in the royal
01:46:31
broadband programs under O Biden and one
01:46:33
of the things they were saying to me was
01:46:35
that there is this entire uh edifice as
01:46:38
he put it of policy that is here to make
01:46:41
sure I do nothing wrong what would be
01:46:43
better and I think this is right is to
01:46:46
allow me to act more and then look
01:46:47
afterwards to see if I did something
01:46:49
wrong and then hold me accountable for
01:46:50
it i think too much of our regulation is
01:46:52
precautionary as opposed to being able
01:46:54
to to let people move quickly and make
01:46:57
decisions in the real world and then go
01:46:59
back and see how they worked out all
01:47:00
right i I think that's a a great point
01:47:02
and I agree with you on that and I think
01:47:05
there are a lot of people out there who
01:47:07
would say that government's too too
01:47:08
bureaucratic there's too much red tape
01:47:10
in terms of getting things done any kind
01:47:11
of project like the rural broadband
01:47:13
takes 15 steps three of them were DEI
01:47:16
that's crazy the environmental reviews
01:47:18
and the lawsuits that bog these projects
01:47:21
down for years make them
01:47:23
unfinancable there are people who agree
01:47:25
with you on that you know what they're
01:47:27
called republicans republicans agree
01:47:29
with this but you know who doesn't agree
01:47:32
with you aoc and Elizabeth Warren and
01:47:35
Bernie Sanders so maybe you're in the
01:47:37
wrong party because I don't think you're
01:47:39
going to convince Democrats of this well
01:47:41
we'll see well I wish you well in that i
01:47:44
hope you do i appreciate that yeah no I
01:47:46
do i I think if you can convince
01:47:47
Democrats of this I think it'd be a
01:47:48
great thing but look this is my issue
01:47:51
with some of what you and and Larry are
01:47:53
saying is that you want Elon and Trump
01:47:56
to abide by all of these procedural
01:47:59
nicities you want them to play by
01:48:01
saying Marath of Queenberry rules you
01:48:05
keep saying this is my view but it's not
01:48:06
my view you know who get things done and
01:48:09
this is what we say in Silicon Valley
01:48:10
you know who get things done disruptive
01:48:12
people founders founder mentalities
01:48:14
they're the ones who get things done
01:48:16
your response Ezra as we wrap here i
01:48:18
know you have to go getting dumb things
01:48:21
done quickly is not a good idea and that
01:48:25
is why Starlink is a much better idea
01:48:27
than rural broadband neither are
01:48:28
batteries batteries are not dumb things
01:48:30
you're asking me about what Trump and
01:48:31
and Musk are doing right now we started
01:48:33
here on the tariffs what what you're
01:48:36
watching with Trump is using expanded
01:48:38
tariff authorities to do things that
01:48:40
have a bad process behind them and will
01:48:42
have a bad set of outcomes so look I've
01:48:44
asked you many many times here i don't
01:48:46
really feel like I got the set of
01:48:48
metrics I was looking for but we will
01:48:49
maybe talk again in 2 or 3 years and we
01:48:51
can decide together was this genius work
01:48:54
by the disruptors or was this a really
01:48:57
really dumb approach to economic policy
01:48:59
what was the issue with the metrics that
01:49:01
I gave you Ezra you don't think they're
01:49:03
I I I don't think I don't think they're
01:49:05
You want the unit of measurement
01:49:06
kilogram i don't think they're remotely
01:49:08
complete i think you're processing us
01:49:11
you're doing to us exactly what the
01:49:12
government bureaucrats did to rural
01:49:14
broadband what's your metric how long is
01:49:17
it going to take you to deploy this we
01:49:18
have to go through a checklist yeah
01:49:20
exactly come on these are debate tactics
01:49:22
here's all you need to know Ezra it's a
01:49:24
hundred bucks to get Starlink it's
01:49:26
15,000 to do fiber we're trying to
01:49:28
debate principles and you're trying to
01:49:30
bog it down in procedural arguments hold
01:49:32
on this is amazing to me do you really
01:49:35
think saying to you in 2 years what are
01:49:39
three or four metrics that would give
01:49:42
you what you gave me doesn't fit the pol
01:49:44
I mean look we don't need to do this
01:49:45
whole thing again but what you gave me
01:49:48
doesn't fit the policy it's just
01:49:49
re-industrialization hold on we said
01:49:51
that we want to re-industrialize America
01:49:53
in critical industries especially and
01:49:55
reduce our dependence on foreign supply
01:49:57
chains that are based in potential
01:49:59
adversary countries that's concrete
01:50:01
enough as well those are basic a
01:50:03
sufficient objective
01:50:04
Because the other thing that I the part
01:50:06
of you the part of it that I did not
01:50:07
hear things seems to be measured was
01:50:09
okay where is the economy right there's
01:50:12
got to be some cost you don't want to
01:50:13
pay so what metric would you want I'd
01:50:15
like to see like okay GDP growth has
01:50:17
been X I would like positive GDP growth
01:50:20
and we want resiliency for those four
01:50:22
critical industries amongst others okay
01:50:24
and and it be nice for the trade
01:50:25
deficits to come down and you know
01:50:28
especially with certain countries get
01:50:29
back to work then we're all going to get
01:50:31
back to work we got the four critical
01:50:32
industries we got the GDP increase and
01:50:35
uh yeah trade deficits yeah it's it's an
01:50:37
open debate all right Ezra Klein's new
01:50:40
book Abundance is out in fine bookstores
01:50:43
and Amazon and all kinds of other places
01:50:45
you can get it and you can hear him on
01:50:48
podcasts incessantly when are you going
01:50:50
to stop this podcast for Ezra oh my god
01:50:52
I know man it's growth industry one of
01:50:54
the last absolutely all right we'll talk
01:50:56
to you soon Ezra bye y'all thanks for
01:50:58
having me thanks Ezra all right thanks
01:51:00
Ezra how do you think the debate went i
01:51:01
think is a good debate to have and we
01:51:03
made progress here the paradox of all of
01:51:06
this is what they're describing in some
01:51:10
ways is what Trump and Elon are doing
01:51:13
yes but it's a it's a bit too hot so if
01:51:15
I were to give a criticism or room for
01:51:18
improvement to the current
01:51:20
administration to maybe pull some of
01:51:22
these people over it's basically slowing
01:51:25
down and explaining what's going on a
01:51:27
bit better i give the administration
01:51:30
like I give Doge an A++ it's obvious
01:51:32
like they're doing the right thing i
01:51:34
give the communication like a B like
01:51:36
just increase the communication and you
01:51:37
can see they're doing that antonio went
01:51:39
out and talked a bit about Doge they did
01:51:41
a a round table and they're updating the
01:51:43
website faster the more you do that the
01:51:45
less the opposition's mind is going to
01:51:48
wander the same thing with the tariffs
01:51:49
if the terrorists if if Bent was out
01:51:52
there front and center every day talking
01:51:55
about methodically what their plan was
01:51:57
instead of the shock and awe I think
01:51:59
people would be able to process it
01:52:00
quickly let me just add one person's
01:52:02
opinion okay I like that obviously you
01:52:04
can always say that communication should
01:52:06
be better but but here's the reality of
01:52:07
it take Doge for example you have crazy
01:52:11
leftists firebombing Tesla dealerships
01:52:14
painting swastikas on Tesla cars
01:52:18
accosting Tesla drivers okay creating
01:52:23
violence and chaos and trying to depress
01:52:25
Tesla's sales okay and who's to blame
01:52:29
for that and then what people say is
01:52:31
well somehow Elon's the disruptive
01:52:33
figure here you have a crazy leftwing
01:52:35
that's reacting in crazy ways to
01:52:38
sensible things that Doge is doing and
01:52:40
then what people do is they
01:52:42
reinterpolate this chaos that's being
01:52:44
created by the left they somehow put the
01:52:45
blame for that on Elon i think your uh
01:52:48
explanation there is even more reason to
01:52:50
be proactively communicating decisions
01:52:53
so and that doesn't forgive anybody
01:52:55
drawing SWAT stickers on Teslas
01:52:57
obviously they should go to jail and if
01:52:59
anybody's coordinating it that should be
01:53:01
like a RICO case and we should find out
01:53:03
who it is just if we're going to bring
01:53:05
these two parties together which I think
01:53:06
we came close to here of like finding
01:53:07
some common ground I think Chimath you
01:53:09
outlining your four bullets and then at
01:53:11
the end Ezra saying well what what's the
01:53:13
impact on GDP and then you adding to
01:53:14
that sax well what's the you know input
01:53:16
on the trade difference for the first
01:53:18
time you know these two sides I think we
01:53:20
outlined what should happen what should
01:53:22
the measure be in two years are have we
01:53:25
on shored those important industries is
01:53:27
GDP P robust and is the trade deficit
01:53:30
deficit more balanced this is the same
01:53:32
debate we always had over immigration
01:53:34
let's pick a number and work towards a
01:53:36
number right and and that's where the
01:53:38
debate in our country breaks down in my
01:53:40
mind is that we don't pick numbers we
01:53:42
can agree that we need a ton of
01:53:45
innovation segue Jason go hey uh Chimath
01:53:48
I saw that you were at the breakthrough
01:53:51
prize ceremony over the weekend sorry I
01:53:53
couldn't make it Yuri i uh I had family
01:53:54
stuff but Freeberg was there as well and
01:53:57
uh as everybody knows this is the
01:54:00
breakthrough prize is like kind of the
01:54:01
Oscars for science they had hundreds of
01:54:03
guests there and uh about a third of
01:54:05
them were scientists a third were tech
01:54:07
founders and you had a bunch of
01:54:09
Hollywood folks there hosted by James
01:54:11
Cordon and you had Jeff Bezos Yuri
01:54:14
Milner as I mentioned Zuck Vin Diesel
01:54:17
Sergey and Gwennneth uh and Mr beast
01:54:21
lots of excitement there and I know
01:54:23
David you were at a secret conference
01:54:24
that uh also I was almost invited to
01:54:28
that um you met Gwennneth Paltro friend
01:54:31
of the pop jason my Nick you can show
01:54:33
some photos here oh we do have photos
01:54:35
okay I know why don't you show them my
01:54:37
wife sent me a letter to read on the air
01:54:41
so let me just open this up here is this
01:54:43
an open letter what's the letter to oh
01:54:45
my okay dear Gwennneth Paltro oh jeez
01:54:50
just a open a love letter to Gwennneth
01:54:53
okay I'm just going to read this here
01:54:55
last night when I met you I learned in
01:54:58
that moment that pherommones are not a
01:55:01
myth they are real and apparently
01:55:03
trademarked by you you have the kind of
01:55:05
femininity that could destabilize the
01:55:08
stock market i left the encounter
01:55:10
slightly dazed unsure if it was your
01:55:12
presence or an as of yet unlisted goop
01:55:15
candle okay wait let's just stop here
01:55:17
let me just mansplain what she's trying
01:55:18
to say here guys wait are you saying
01:55:20
she's got a girl gwenneithro crashed the
01:55:23
stock market gwennneth Paltro is hot as
01:55:25
balls okay that's the Troy are you
01:55:27
saying she crashed the mark she has so
01:55:29
much aura and rez david you have to I
01:55:32
mean I don't know if we have the picture
01:55:33
where David met her at the JPM
01:55:36
conference but she is so kind she's got
01:55:39
high EQ but I I I got to say so cool i
01:55:42
have to say like I've met a lot of stars
01:55:43
that's like a star star
01:55:46
that's a star star where you're just
01:55:47
like "Holy shit." You're just kind of
01:55:49
like a little bit in awe
01:55:51
she's Oh she's a star she's a star look
01:55:54
at that there she is fifth bestie
01:55:56
Gwennneth Paltro GO nat was stunned nat
01:55:59
was stunned i was stunned we were all
01:56:00
stunned so wait are you saying that Nat
01:56:04
has a girl crush i think so a girl crush
01:56:07
has been declared here for the first
01:56:09
time on Allin we have an official girl
01:56:11
crush what I think is just remarkable
01:56:13
Jason though is that another conference
01:56:15
lost your invitation in the mail i mean
01:56:17
it just keeps happening you got to talk
01:56:19
to the post office about all these
01:56:20
invites
01:56:24
i my White House invite this uh your
01:56:27
mailman he must hate you or something i
01:56:30
don't know i got to get invited to
01:56:31
something i think you're the party i
01:56:33
guess I'll see everybody in F1 you're a
01:56:34
great You're a great family man so at
01:56:36
least you're But you're always busy with
01:56:38
your family so I think people Well I try
01:56:39
to prioritize the fam i got young girls
01:56:41
just what am I supposed to do you know
01:56:42
oh my gosh big shout out big shout out
01:56:44
to Yuri and Julia Milner I think uh yes
01:56:47
incredible and what they're doing to
01:56:48
inspire people to get into science is
01:56:50
just so you know you know they the
01:56:52
awards are enormous it's like $3 million
01:56:55
awards which I think is just kind of
01:56:57
like it's an amazing reflection of how
01:56:59
important this stuff is and every so for
01:57:01
the last two years also had a little
01:57:03
tear had to shed a little tear because
01:57:06
they do these things where like you know
01:57:08
you you bring some of these folks that
01:57:09
have been impacted positively there was
01:57:11
a girl who had her jeans edited she was
01:57:14
literally on on her deathbed and this
01:57:17
guy David Lou who won the Breakthrough
01:57:18
Prize did a very targeted gene edit
01:57:21
she's alive and thriving and she gets to
01:57:24
present the award to him and you're just
01:57:26
like "Oh my god it's you know Sax when
01:57:28
he said he was shedding a tear or almost
01:57:30
shed a tear." I thought he was going to
01:57:31
say he saw his reflection in his tuxedo
01:57:34
and just got a little choked up about it
01:57:36
because of how good he looked roth does
01:57:38
look good in that photo put it back up
01:57:39
put it back up let's see what are you
01:57:42
wearing the silhouette the silhouette on
01:57:44
your tuxedo is just uh outstanding that
01:57:46
so Nat So Nat's wearing Armani P and I'm
01:57:50
wearing Laura Piana which is like a
01:57:52
double breasted they make a double
01:57:53
breasted wow i didn't know they made
01:57:55
that cashmere cashmere tuxedo i I cannot
01:57:58
comment on the material choice because
01:58:00
it was just that is absolutely wow
01:58:02
that's a gorgeous garment well actually
01:58:04
you know Freedberg was going to be on
01:58:06
the program today but then he found out
01:58:07
how many endangered species were
01:58:10
murdered did you Did you see that nick
01:58:13
do you have the picture of us with Zoe
01:58:14
Sana oh there's Austin Friedberg oh
01:58:16
Freeberg looks good oh there's Zoe Sana
01:58:19
the Mr beast and her husband who's the
01:58:21
guy with the man bun marco Paraggo great
01:58:23
guy this is Zoe Sana's husband a cooler
01:58:27
funnier fun dude you're not going to
01:58:29
That guy should be at every party really
01:58:32
bun huh he definitely looks like he's
01:58:34
carrying look at Look at Zoe Sana's uh
01:58:36
tattoo in her on her chest i don't know
01:58:38
if that's I want to see if that clo You
01:58:39
know that closed guy on X who's always
01:58:42
critiquing Republicans oh he's awesome i
01:58:44
love I wonder yeah Derrick or whatever I
01:58:46
want to I want to know if he how he
01:58:48
responds well that's terrible Mr beast
01:58:50
fails but I want to know how he responds
01:58:52
to your tuxedo Jamath and finally gives
01:58:54
you credit because I think he he only
01:58:57
compliments Democrats is sort of the
01:58:59
problem oh is he really not uh yeah he's
01:59:02
always picking on Republicans jimmy
01:59:04
looking Did you guys see the picture of
01:59:06
Julia's dress i just want to say one
01:59:07
thing about Julius did you see Julia's
01:59:09
dress i I haven't let's take a look here
01:59:10
this is an insane story so this is Julia
01:59:12
Milner so the cool thing about this guys
01:59:14
is this is this is a very incredible and
01:59:18
famous painting by Raphael called the
01:59:20
school of Athens yes this is like a a
01:59:23
visual manifesto of human knowledge and
01:59:25
so there's all these very important
01:59:27
people Aristotle Plato Socrates
01:59:30
Pythagoreia Pythagoras etc anyways she
01:59:33
got the license I think from like the
01:59:35
Vatican and then she worked with Dolce
01:59:37
and Gabbana to make it into a dress for
01:59:38
the occasion just to celebrate learning
01:59:41
but there she is with with our boy Jimmy
01:59:43
Donaldson so anyways it was a great
01:59:45
event thank you Yuri and Julia for
01:59:47
including us all right guys i gota wrap
01:59:49
all right David i miss you thanks for
01:59:51
the invite
01:59:53
all right bye i will handel Jason's
01:59:56
invitation for 20 seconds i'm pretty
02:00:00
sure
02:00:02
i mean I I have a phone number you could
02:00:04
text me the invite i could You could
02:00:06
send me a calendar i have a Gcal i've
02:00:08
got a Google calendar you could invite
02:00:10
have a
02:00:11
good so funny that that event that Sax
02:00:14
was at one of our mutuals was like "Hey
02:00:17
guys this incredible event's going on
02:00:19
this famous person's hosting it these
02:00:20
celebrities are coming jay Cal Freeberg
02:00:23
everybody you're all invited." And then
02:00:25
like two weeks before they went I was
02:00:26
like "Um are we going to this thing?"
02:00:28
Cuz I'm just like my calendar and
02:00:29
everything they're like "Ah
02:00:32
yeah yeah the event's happening." And
02:00:34
I'm like "Fo you Jason did you send the
02:00:37
event?" And they're like they're like
02:00:39
I'm not sure you're my ride or die
02:00:41
you're my ride or die texting me the
02:00:43
invite but you didn't email it okay sure
02:00:45
i will never go to an event that rejects
02:00:47
you ever like a ride or die baby for our
02:00:51
chairman dictator another exceptional
02:00:53
episode of the all-in podcast we'll see
02:00:55
you all next week byebye
02:00:59
we'll let your winners
02:01:01
ride rainman David
02:01:07
and it said we open sourced it to the
02:01:08
fans and they've just gone crazy with it
02:01:11
love you
02:01:16
[Music]
02:01:20
besties
02:01:20
[Music]
02:01:21
are my dog taking notice your driveways
02:01:27
oh man my appetiter will meet the ugly
02:01:30
we should all just get a room and just
02:01:31
have one big huge orgy cuz they're all
02:01:33
just useless it's like this like sexual
02:01:35
tension that we just need to release
02:01:36
somehow
02:01:41
your
02:01:42
feet we need to get merch i'm going all
02:01:48
[Music]
02:01:52
in i'm going all in
