Looking forward to our thing in a few

weeks. Yeah. I don't know if I'll end up

being there, but I'm hoping to. I'm

hoping to. It's been What do you guys

You guys have like a liberal cuddle

party or what are you doing? Yeah. Yeah.

Larry Larry takes a bunch of MDMA and we

all sort of go into the the corner and

hang out together. God, that sounds

incredible. Liberalism is wonderful,

man. You should come try it. That's not

liberalism. It's called something else.

Sorry, Nikki. Is our cryptozar joining

us or no? He's uh I'm talking to now. It

looks like he is. Oh, zing. This is

going to be great. This will be like

ratings bonanza. All right, we do have

David Saxs here. David, make sure you

have a quick time on. Look at Sax

looking so presidential. He looks thin,

doesn't he? Oh, he looks fabulous. All

right, here we go. Three, two, one. Let

your winners.

[Music]

We open source it to the fans and

they've just gone crazy with it.

All right everybody, welcome back to the

number one podcast in the world. I'm

your host Jason Calcanis with my besties

Chim Polyha Patia our chairman dictator

and live from well the administration

Mr. David Saxs our ZAR for AI and crypto

and amazingly two fantastic guests this

week we have uh New York Times writer

and host of the Ezra Klein podcast. He's

got a new book with Derek Thompson,

Abundance, and he co-founded Vox in

2014, and he's our guest here today

before Trump ships him to El Salvador.

Please welcome Ezra Klein. How are you,

sir? Glad to be here in my final hours

of freedom. Okay, great. Good to be

here. Sorry, Saxs. Uh, and uh, with us,

of course, Larry Summers, economist,

former Treasury Secretary under Clinton,

former director of the National Economic

Council under Obama, and the president

of Harvard from 2001 to 2006. Thanks for

coming, Larry. Good to be with you.

Okay, we have a lot to get to here, so

we uh might as well talk about the big

news of tariffs. It's day 80 of the

Trump presidency and a second

presidency, his second term, and Trump

tweeted that he paused tariffs for

everyone but China on Wednesday.

Basically, let me just ceue up the

details, Larry, and then we'll get your

take on all of this. Just one week after

Liberation Day, Trump announced on Truth

Social that in effect he was raising

tariffs against China

125% based on their lack of respect,

quote unquote, instead of negotiating

and that he was pausing reciprocal

tariffs on all other countries for 90

days and markets ripped 10% after he

posted this. And today, Thursday, when

we tape, there's been a massive selloff

on Wall Street. So, the roller coaster

ride continues. What it will be on

Friday when you consume this podcast is

anyone's guess. S&P is down 5% today.

For context, the S&P was at 5700

pre-liberation day. So, about a 9% drop

after these wild swings. And uh in fact,

this has been historic

volatility. Here are the top selloffs in

history. As you can see, three of them

came during Black Monday in

1987. Three of them came during the

financial crisis. Three of them came

during COVID. And uh coming in 11th is

Trump's tariffs. Also in the gainers, uh

you have these big

rebounds. Wednesday's 9.5% recovery was

number three. The administration says

this was all part of a master plan.

We'll hear more about that later. And

that they laid a trap for China. They

lit a trap. Bessent has been the

spokesperson during this retreat or

whatever we're going to call the uh

pause. And quote, "This was driven by

the president's strategy." He and I had

a long talk on Sunday and this was his

strategy all along. I don't think we

need to play the clip. Uh that's the

gist of it. The White House account then

tweeted in all caps, "My favorite way to

tweet, do not retaliate and you will be

rewarded." Wall Street Journal on the

other side posted a story about why

Trump blinked. They chronicled the

decision as uh being affected by Jaime

Diamond who went on Fox to express fears

of recession while saying the tariffs

were valid and that he knew that Trump

and cabinet would be watching him on

Fox. Other banking executives who felt

they didn't have a lot of influence in

this administration, according to the

Wall Street Journal, started lobbying

Republican

lawmakers that the Trump tariff plan

would tank the economy. The White House

chief of staff Susie Wild started

receiving calls from executives and

lobbyists expressing concerns and uh the

Wall Street Journal reports that Trump

was influenced heavily by Bessant. They

were flooded with worried calls from

Wall Street and that the president was

uh lobbyed to find an off-ramp. Trump

ultimately relied on his instincts

according to the administration. Larry,

is this 4D

chess or is this something else? What

are your thoughts?

This is uh dangerous work with a

sledgehammer on a pretty sensitive

machine which is the global economy

that's having really serious uh

consequences. First, it's important to

understand that there's more tariffs

that are around than you described. Even

after the big backoff, there's a 10%

across the board tariff, a range of

structural tariffs like on steel and

automobiles, and a range of new tariff

threats like on uh

pharmaceuticals. Here's a kind of

market-based estimate of what the damage

that the market thinks this is all doing

to the US economy is. Market's down.

Let's take today's number 9%. If that's

right, that would be about $4

trillion. Of course, the at $4 trillion

since Liberation Day. Of course, markets

were down coming into Liberation Day

because of some anticipation of these

policies. So, let's be conservative and

say these policies have taken $6

trillion off the stock market. Now the

stock market only measures the adverse

impact on corporate profits, not the

adverse impact on workers, not the

adverse impact on consumers. So you need

to add to that uh stock market number.

Uh one way of thinking about adding to

it would be to say that corporate

profits were 10% of the economy. So you

could argue for multiplying by a factor

of 10, but maybe that's being too

exaggerating or too bold. So let's

multiply by a factor of uh five. And

what you get is a loss in the $30

trillion range as the present value as

estimated by markets of what's being

done. Now, I know the Trump

administration sometimes likes to say

it's working for Main Street, not Wall

Street. I noticed that they were pretty

excited about the stock market rally

yesterday in a way that wouldn't really

go with uh not caring about uh markets.

So, I think what markets are seeing

what's is what's true, which is three

things. This is an inflation shock cuz

you're adding to prices. CEO of Amazon

got it right. The Secretary of the

Treasury got it wrong. Increases in

tariffs of this magnitude, the

overwhelming part of them will be passed

on to consumers. So, you've got an

inflation shock. When you raise the

prices of people and their income, at

least in the short run, is the same,

they're poorer and that means they can

afford less stuff and that pushes the

economy down. And so you've got higher

inflation and you've got um more uh less

demand and therefore more

unemployment. All of that's bad for the

economy and companies. And the last

thing which I think is profoundly

important is we are trading like an

emerging market country right now.

For serious countries, for the United

States, the pattern is that when the

world gets

riskier, the bonds go down in yield and

the currency goes up in value because

people come for the safe

haven. When you're a country like

Argentina, then the assets all move

together. falling stock prices go with

higher bond yields go with a weakening

currency. And so because of our erratic

behavior, we have changed the

zeitgeist surrounding America from the

traditional zeitgeist surrounding

America to the kind of zeitgeist that

surrounded Juan Peron's

Argentina. And that goes with all the

other things that are happening. The

more protectionism, denying the

independence of the central bank, fiscal

irresponsibility, breakdown of

traditional boundaries between

government and business, substantial uh

cronyism as a strategy, authoritarian

tendencies towards uh the opposition,

lack of total respect for uh the

judiciary. Larry, keep going, Larry.

What we're seeing is a is a pattern of

America being governed on the kind of

Juan Peron Argentina model and that

sometimes produces some benefits for

some people in the short run that

sometimes generates popularity

uh for it. Peron kept coming back in

Argentina, but ultimately it's extremely

costly for our society. Uh you've you've

heard uh Larry's uh take on all of this.

Larry's giving it about a a B+ on the

Harvard great scale

which might be inflated. I'm not sure.

Sachs, obviously in the administration,

you cover two things, AI and of course

crypto. And you're a member of the pod.

So, let's get your take on what happened

this week with these tariffs. Even the

most ardent supporters of Trump have

felt this is chaotic, not well executed,

not communicated well. What's your take,

Saxs, on how this was executed, and

could this have been done better? Well,

I think what happened if you go back to

Liberation Day was only 8 days ago. It

was April 2nd. If I had told you on

April 1st that Donald Trump would find a

way to get the entire world to eagerly

embrace a 10% tariff on the American

market and not only would they not

complain, but they'd actually be

relieved that it was only 10%. You would

have said that would be an April Fool's

joke. If I had told you eight days ago

or nine days ago that Trump would find a

way to accelerate the United States is

decoupling from China, which is

something he's long wanted to do, and

that Wall Street would basically breathe

a sigh of relief over that, you would

have said that there's no way that could

happen. If I had told you eight or nine

days ago that President Trump figured

out a way to assert a presidential power

in a way that gives America

extraordinary leverage over virtually

every country in the world, you would

have said, "Well, I don't believe it. I

don't you know what what is that power?

And he proceeded to do that and now

basically every country in the world

except for for China is coming to

Washington seeking to negotiate a new

trade deal for the United States on

better terms for the US. If you told me

any of that few days ago, I would have

believed you and I would have thought

the consequences would be a

substantially

deteriorated American economy and a

substantially less secure. I don't think

we know that United States. I don't

think we know that. It's not any

surprise. There's nothing surprising

about the fact that the United States

has the power to extort Loto. It's just

and that's that's the country that was

singled out in the Trump formula for the

highest level of protection. There is no

surprise in uh that. There is no

surprise

that capacity to isolate itself to

Washington. will be very very Japan's

coming to Washington. South Korea is

coming to Washington. Everybody's going

to try to cut everyone's going to come

to Washington. It never would have

occurred to anyone with experience in

government that the United States would

have any difficulty getting any major

country to come send a representative to

the United States to have a discussion

and a negotiation with a United States

on a matter that was of concern to the

United States. They never could possibly

have commish any Let me let Sax reply to

that and then Ezra I'm going to bring

you in. Saxs go ahead you reply. Then

why didn't they Larry? Do you think that

all these countries were going to

renegotiate their trade deals with the

US if President Trump asked nicely? If

he said pretty please renegotiate our

trade deals so you take down your trade

barriers they would have done it. If he

had said pretty please with a cherry on

top. That's not the way these things

work. He had to establish the leverage

in the negotiation first. And the fact

of the matter is he's the first

president in decades who's been willing

to do that. You don't get anywhere by

just asking nicely. And I think that

what President Trump did over the last

eight days is a establish the leverage

and b get all these countries to now

want to negotiate a new trade deal with

the United States. If this is such a

terrific

thing, why do markets think it's so

terrible for the American economy? Maybe

there maybe the market's just completely

wrong. But at least another possibility

is the question that the market's

judging this that the market I mean job

of markets is to look forward. It's to

look past the immediate. It's to see

what the long run consequence are going

to be. And markets are making a pretty

devastatingly negative judgment. Not

true. Not true. Not true. That feels

emotional and nice, but it's just not

accurate. So, let's just establish a

couple facts about quote unquote the

markets. Number one, there are two

markets and they behave totally

differently and sometimes inversely to

each other. There's the stock market and

there's the bond market. With respect to

the stock market, what they are

debating, and you're right, Larry, is

what is the effective long-term rate of

return a dollar needs to generate in

order to pay me back that dollar. That

is what the fundamental stock market

does. And what we've seen for many years

with trade imbalances, trade deficits,

and close to zero interest rates, of

which more of that happened under

Democrats and Republicans, we have

allowed the stock market to inflate past

historical averages. What we've actually

seen happen in the last week is what

most people would call mean reversion.

The stock market is still way above

where it was last year, two years ago,

three years ago. What has happened is

that the forward multiples have

compressed. So that's number one. That's

a fact. You can debate whether that's

bad or good. And I'm willing to debate

that with you. Okay. Now let's go to

bonds. Yeah. And then with respect to

bonds, what we are seeing now is there

are two very complicated issues and we

don't know what the unknown known is.

And let me be very specific. In the last

two days, we saw one part of the bond

market totally get out of

whack. And what we know is that the

yields changed materially in a very

acute way, which is atypical of how the

bond market typically digests a

philosophical change in approach to

policy. Normally, when you see an acute

reaction in the bond market, the

underlying reason tends to be some

financial calamity. in a participant.

What we heard in the last 24 hours is a

lot of this move may have been

attributed to an enormous levered bet on

US treasuries by a Japanese hedge fund.

It will take three and four and five and

6 weeks for us to really know

separately. What we do know though where

the structural complexity of the market

and this is where Larry I agree with you

is acute and important to observe is in

the credit markets for private companies

and that is where you have to pay a lot

of attention. Okay, Larry, let me let

you respond to Chimath's response to you

and then Ezra, I promise you're going to

come in next. Larry, go ahead. Martha,

as you well know, the vast majority of

financial thinking

emphasizes changes in the earnings

prospects of companies associated with

the strength of the economy as a major

source of stock market fluctuations. And

if you look at dividend strips, if you

look at what's happening to analyst

revisions, that's got a lot to do,

negative prospects for the economy, has

a lot to do with why the economy, why

the stock market has turned downwards.

The foreign exchange market's very big

and it's a big referendum on whether

people have confidence in uh the United

States and somehow tariffs reduce

imports are supposed to reduce dollar

selling and make the currency go up and

not only is the currency not going up,

it's going down substantially. So, we're

seeing a pattern. Maybe it's all just

due to one Japanese hedge fund, but

maybe we're seeing a pattern that really

looks that looks pretty much like uh the

Argentine pattern. Ezra, you uh are

hearing this debate. I think there's no

debate that this was done in a very

extreme fashion at a minimum. Do you

wonder if this could have been done in a

more gradual or thoughtful way? What's

your take on the execution here by the

administration of these tariffs and

their response to the markets? I I can't

say I wonder if it could have been done

in a more gradual, thoughtful way. It

could have. Uh I I defer to Larry on the

markets. I'm more of a a connoisseur of

arguments and something I've been

thinking about over the past very long 8

days is covering the 2024 election and

covering Donald Trump's tariff promises.

And it was a thing that liberals like me

were doing where we would do these shows

and say Donald Trump is promising a 10%

to 20% global tariff and then 65% tariff

on China and if he does that it'll have

this set of effects higher prices it'll

create financial uncertainty etc. And

what I would be told like the the

counterargument was oh you libs you

always take him literally when you

should be taking him seriously. had

became Swami on my show. He said he's

not going to do that. That's just a

negotiating ploy. And this was the the

common line from Trump allies on Wall

Street. And then I watched as he began

doing not just that, but layering uh a

series of then bilateral tariffs on top

of that plan. The markets began freaking

out. While they were freaking out, a

bunch of his defenders said, "No, no,

no. Actually, these tariffs, which we

told you were never going to happen, are

actually a great idea. we need to reset

the entire global financial system and

you can't uh shift those tectonic plates

without creating a few earthquakes. Then

the moment the tariffs paused with the

90-day pause on the uh tariffs on top of

the 10% and the China tariff, then I

heard, "Nope, that pause is genius.

Haven't you read the art of the deal?"

And what I would observe from this is it

usually when an idea is good, you don't

need people jumping back and forth on it

so often going between these tariffs are

a bad idea but they're a smart

negotiating ploy to these tariffs plus

are an actually great idea and you

should all calm down as Trump said you

should all be cool back to know these

tariffs are a great idea. I I think

something I'd love to hear from David uh

it's very hard to break the the pattern

being a podcast host. I would like to

hear what the measure of success in two

years is. Right? We can sit here and

speculate about the effect of these and

I'm much more on on Larry's side than

what I'm hearing from from Chimath and

David. But if what are your measures?

What in 2 years? Good question. If

manufacturing, you know, employment or

whatever is below X, will you be

unhappy? if GDP is what what is a a sort

of uh objective yard stick where we

could come back in 700 days and say did

this work out or was this a bad idea? Go

ahead. I would say probably the biggest

thing would be whether the US can

re-industrialize to some extent so that

we're not completely dependent for our

supply chains on on a potentially

hostile adversary. And what is the

measure of that? Is it the the quantity

of manufacturing we're making? Is it the

share of manufacturing? I think that's a

hard thing to understand. You know

during co we

learned point I am saying it concisely

during co we discovered that we were

horribly dependent on a supply chain

from China for some of our most

essential products for pharmaceuticals

for other medical gear that we needed

during co Sure. So what would be if you

were to put a metric on just as one

example but we've also learned that our

entire supply chain for all sorts of

industrial products now is dependent on

China and other countries. So, let's be

more precise. We have 4%

unemployment at the record low of our

lifetimes. And do you think Americans

want to work in these factories? And if

so, which factories? Obviously,

pharmaceuticals, that's a dependency.

Obviously, building ships and weapons,

that's a dependency. I think we can all

agree on that. And that might be

hundreds, low hundreds of thousands of

jobs. Do you believe we should be making

Nike sneakers here? Do you believe we

should be making jeans here? Again, what

what would be the objective measure of

success? like a certain number of jobs,

certain number of factories, certain

types of factories. Because the other

piece that I don't understand, and maybe

you can inform me here, Saxs, is number

one, who's going to do this work if

we're uh going to be deporting millions

of people and we have the lowest

unemployment of our lifetimes and we

have automation coming to these

factories and Americans don't want to

take these jobs historically. How is

this all going to work? It seems a bit

farcable to me that we're going to bring

these things back. I don't think the the

millions of Americans who lost their

jobs in the heartland because we let

China into the WTO which is something

that Larry I think supported and

championed talking about decades though

right that's what started this whole

thing yeah okay okay I don't think those

millions of people want to lose their

jobs you're talking nonsense what are

you talking about respectfully David you

are Treasury secretary when we walk when

we walk China into the WTO and you're

just still defending it I was just

watching an interview hold David Larry

you just did an interview with Neil

Ferguson

answer. Why am I the only one who gets

to talk for two seconds before I get

interrupted? You guys give 5 to 10

minutes. Finish your thoughts. Finish

your thoughts. I got to speak for two

seconds then you interrupt me. You speak

for five or 10 minutes. Go right ahead.

Larry, I just saw you do an interview

with Neil Ferguson where he asked you,

was it a good idea to bring China into

the WTO? Was it a good idea to give them

permanent normal trade relations status?

Basically, MFN, which is something that

Bill Clinton did in 2000. And I admit it

was bipartisan. George W. Bush continued

it was and you were defending this as a

good idea for the country. What was the

result of that over the past 25 years?

Millions of industrial jobs were lost or

export to China. Millions of factories

shut down. The United States has a

diminished and hollowed out industrial

base. We certainly can't make the

products of the future like drones or

semiconductors. Jason, just to answer

your question, yeah, obviously some

industries are more strategic than

others. Do I personally care about

sneakers or textiles? No, I personally

don't. Do I care about semiconductors?

Absolutely. Do I care about circuit

boards? Do I care about drones? Do I

care about robots? Do I care about EVs

and cars? Absolutely. Okay, those

industries, we are no longer in a

position. We are no longer in a position

as a country to make those products

because we exported our entire supply

chain and manufacturing base to China. I

have three. So, how is that a good idea,

Larry? Okay, I have three questions and

then Ezra, I'll go back to you and Shim.

Go ahead. I have three questions for

you. One, can you name a single trade

barrier that was reduced by the United

States associated with China accession?

A single restriction that existed uh in

the United States that had not been in

place for 5 years before that we removed

during China's WTO accession. Can you

name one? I don't think we should have

done any of it, Larry. We threw open our

markets to Chinese goods. What

restriction? your your thesis is that we

threw open the market and therefore we

exposed ourselves to all of this China

thing and question I'm asking you is can

you name any restriction on Chinese

exports to the United States that was in

effect in

1999 and was removed by our WTO

accession in 2000. Can you name any such

restriction? Just name. This was a

policy that built up over time and was

basically made permanent. Hold on. It

was made permanent when we walked China

to the WTO and gave them MFN status.

Sorry. I'm sorry, David. I'll ask the

question one more time. We had given

them MFN status 15 years

before. No one. They had MFN status.

They had it for 15 years. There was not

a single reduction in a barrier to

Chinese trade. So the way in which

you're describing it is just bears no

resemblance to what it was. Bring him

into the WTO. What was the point of

bringing him into the WTO? bringing them

into the WTO was to use the leverage

that we had to win a whole variety of

concessions that enabled us to um Larry

more to

China reciprocity. This is an

extraordinary history here. Let's move

forward history. You're denying totally

denying history. All right, listen. This

is a bad deal. Hold on a second. I want

to Let's go back to this just a minute.

I just want to know the the whole

argument you are making is about

increased exports to the United States

that had bad consequences. And so I'm

just going to keep asking you what

barrier that previously existed. Okay,

I'll name them. I'll I'll name them.

I'll name them. Go ahead. Let me get

you. Number one, prior to the WTO, China

imposed a bunch of export duties and

taxes on a whole bunch of goods to

control outflow. Okay, that prioritized

domestic supply. As part of coming into

the WTO, China said, "Hey, hold on.

We'll limit these export duties to only

a specific set of

products and then they cap those duties

at agreed rates." Number two, they

eliminated export quotas. They you

historically had export quotas to manage

the volume of goods. Under that WTO

commitment, they agreed to phase out all

those quantitative restrictions on

exports except were explicitly justified

under WTO. Number three, they removed

the export licensing restrictions.

Number four, they ended state trading

monopolies for exports. Number five,

they liberalized foreign trade rights.

The point is, people thought that China

was going to be a honeypot of economic

activity and it turned out to be a

sucking sound, a grand sucking sound of

opportunity where the globalist

corporations saw a massive labor

arbitrage. So, it's fair to say that it

was done with the best of intentions,

but it was a bad deal and they got one

over on us. want to say that rather than

having 30 minutes of debate over

something that happened in the '90s, I

would I would like to go back to this

question. I keep not hearing I will

answer your question because that was a

great hear from David. Um, but I'm I'm

I'd love your

student. I never got a chance to

tendency to just begin talking in an

anecdotal way about

aneot

announces you are going to look for

where if it's if in four two years it is

under X, I can come back and we can have

a conversation. Here's the metrics.

Ezra, I'm so sorry. Here's the metrics

for you. Okay, let's go back to Bill

Clinton's speech that was given at

John's Hopkins on March 9th, 20. He was

asking about forward, David.

Forward-looking metrics. What would you

think would be successful two years from

now? Not the history lesson. Wait, hold

on. We haven't finished the debate about

China and PNTR. Okay, but my question

predated that debate. Yeah, we're trying

to get Listen, you're trying to change

the subject. Let's just finish up on

this. No, no, we're trying to move

forward. That's all I'm just trying to

finish up on this topic. Okay, we'll let

you get the last word about this. Okay,

you can have the last word. March 9,

2000, Bill Clinton announces PNTR at

John's Hopkins. It's a very famous

speech. Liam, maybe you can tell us

about how it got written. Anyway, Bill

Clinton promises several things. He

makes a number of arguments for PNTR. He

does not think that this does nothing.

Larry, your argument is that Bill

Clinton didn't do anything. You're

saying that somehow it happened under

Reagan or something like that. That's

not what Bill Clinton was arguing. He

said number one, there'd be huge

economic benefits to the US. He says

quote by this agreement we will increase

exports of American products he means to

China that will create American jobs.

Okay. Did that happen the way we

intended? I don't think so. Number two

is he believed that when you looked at

the data on export flows from the United

States to China it actually did happen

at a quite substantial rate but with

huge trade deficits for the United

States. You're arguing that they they

did not act in a discriminatory way

towards our products. This idea that

Americans could just do business in

China the way that they could do

business here is ridiculous. Anyone who

tried to do business over their nose,

you had to create a JV. You had to get a

local partner, give them 51%. It was

extraordinarily difficult. We were

discriminated against, Larry. It's

ridiculous to try and claim that somehow

this was an equal relationship. Okay?

And we imported far more from them than

we ever exported to them. So, Bill

Clinton was wrong about that. Number

two, he said that signing PNTR and and

bringing China to the WTO would promote

democracy in China, that we would export

one of democracy's most cherished

values, economic freedom. Did that

happen? I don't think so. He said this

would strengthen global trade by

ensuring China adhere to international

trade rules, reducing trade barriers,

and resolving disputes through WTO. Did

that happen? I don't think so. And then

he said on national security, he said it

would improve our national security to

bring China to WTO and help make them

rich. He said quote, "If we don't deal

with China in this way, we will increase

the prospect that they will turn

inward." That's not what happened. We

helped make China rich. We've exported

millions of jobs to them. They built up

their economy and their supply chain to

the point where now they are a global

competitor to the United States. They're

a pure competitor. We turned that baby

dragon into a Drogonsized monster that

can now challenge us in Asia and across

the world for primacy. Why in the world

we have done that just for national

security reasons? That was a very

foolish thing to do. Okay. So Larry, I I

guess I have to let you maybe

self-grade. How did you guys do? Is

there any regrets as Sax is pointing out

there? Obviously, China has not

magically become a democracy, but I

guess you could argue they do have a

middle class now. We haven't gone to war

with them. So I guess you could argue

that this has been good for relations.

But to Sax's point, they are incredibly

powerful and they are our top adversary.

How would you grade the history of this

so we can move forward? Iowa was a

surging, growing, reforming

economy, growing at double-digit

rates. That it was before there was any

WTO agreement. The WTO agreement did not

change a single rule that represented a

US

restriction on imports from China. It

did change a variety of rules, not as

far as I would have liked, that let the

United States export more to China and

that protected United States

intellectual property in China. and that

brought China more closely into the

international system. You need a

counterfactual for what would have

happened if China had been excluded from

the World Trade

Organization. That counterfactual is not

that they would not have sold goods to

the United States. That principle had

already been crossed 15 years before.

Not a single restriction was uh reduced.

So look, anything you would have done

differently? I just don't get I I don't

get the whole uh mindset uh here. I

understand that we should have done more

as a country for the rust belt and

invested in it much more heavily. If I

was worried about dependence and

strategic and all that, the last policy

I would have wanted to abolish was the

CHIPS act. That's the largest, boldest

thing the United States has ever done to

avoid dependence in a national security

area. Great. Let me bring the Trump

administration has killed all of that.

Jimoth, you heard Ezra's original

question and the history here from Larry

and David looking at there are some

industries that we need strategically.

Pharma, military, cars, these are fairly

obvious. Rare earth minerals uh are

obvious, but we also have the lowest

unemployment of our lifetimes and

Americans probably don't want to work in

factories on mass. What is your take on

going forward some metrics that this

administration should not Sax is saying

this you're saying it what what would

you measure this success as in terms of

onshoring and reducing dependencies if

to Ezra's point two years from now we

were degraded give us some specifics

here Chama there is a major issue that

the United States has that's much bigger

than China which can be framed in the

lens of resiliency and the ability to

fend for

ourselves. There are supply chains that

have many single points of failure and

independent of whichever country that

single point of failure exists. It could

be an ally or it could be a foe or it

could be a friendmy that creates risk.

And I think what we are learning and

David's right, it was really highlighted

during COVID, we are not in a position

to take care of what we need. So if I

had to very precisely answer Ezra's

question, I would say that we need to

measure and protect four critical areas.

Everything else I think we can deal with

some inefficiency, some single points of

failure, but the following four areas

Ezra I would say are sacrosanked. Number

one is all of the technology both the

chips as well as the enabling technology

around artificial intelligence. It must

be a robust largely American supply

chain. It must you cannot have single

points of failure outside the United

States because what you see is even in

allied

countries their posture towards things

like free speech and other things can eb

and flow their posture on trade their

posture on defense. Okay, so that's

number one. Can change chips. Got it.

Number two is energy. We have a critical

deficit of electrons in America. We do

not have the capability we need to make

the energy we need quickly in many ways.

We have supply chain issues on nat gas.

We have critical supply chains that can

be shut off by China around

photovoltaics. So whether you believe in

coal, whether you believe in that gas,

whether you believe in clean energy, we

are in a very we got to shore that up.

Okay, I think we're in agreement. Keep

going. Number three are there are

critical material inputs that drive the

material science of the future. Rare

earths are an example. Going back to

chips, things like gallium, things like

phosphorus even. So we have a critical

minerals and rare earths and m and

material science input problem. And then

the fourth Ezra are pharma APIs so that

when American citizens get sick, we have

the ability to not just make it but also

design it and manufacture it because

some of these APIs the active principal

ingredients for many of the drugs

require very convoluted and complicated

processes, cold chains and the like. And

again there we depend on folks whose

view of the United States can change in

real time. So if I had to say to Ezra,

what I would expect is if the United

States government, whoever was in

charge, would put those four things on a

board, then detail out all of the key

inputs, measure how much we can make

ourselves versus import, and then

basically try to level that playing

field, we would be in a very good place.

a couple things because I think I

probably agree with all of that and what

it sounds like is an excellent argument

for Joe Biden's policies which were

functionally maybe not the pharma side

just literally that let's pull out

semiconductors and the semiconductor

supply chain let's pull out energy let's

p a couple of things like that you know

what was it a high fence around a small

garden was what Jake Sullivan called it

let's particularly try to restrict the

supply chain export of AI critical

materials to China. Um they had a whole

set of policies about this. Now the

Trump administration, the thing we are

in theory here discussing is an

extraordinarily broad-based set of

policies. Um it is tariffs on not just

China, it's on Brazil. It's not just on

critical industries like Chimath is

talking about, but it's on, you know,

mangoes and avocados and, you know,

lumber from Canada and and basically

everything else. I I guess there's an

argument I could sort of extract out of

this that the Biden administration

believed what they called French

shoring, which is that you want to

create an integrated supply chain of of

allied countries that we can work with

and that we can rely on. And the Trump

administration, I think, believes

something depending on who's talking

more like that the entire supply chain

needs to be on to America specifically.

But one of the problems and the reason I

I I'm keep trying to push people to be

very clear about their arguments and

very clear about their metrics is that I

feel like there's this king's cup of

what we're trying to achieve here where

one day it's that we're trying to

achieve the re-industrialization of the

American heartland and the next we're

trying to replace the income tax with

tariff income and then the next we're

just using it as all-purpose surplus

leverage against any country that does

anything we don't like and the next day

we're you know using it for uh an

entirely third purpose and maybe we're

just going to use it to to isolate

China, but to bring in our our friends.

But none of these you can't do all of

these things at once. And it needs to be

very stable if you're going to get

companies to do these long-term capex

investment decisions that take decades

to play out. Nobody I know in the market

is you guys didn't want to change

anything. You guys didn't want to change

anything about anything. I wasn't in the

I wasn't in the Biden administration.

Number one, I'm treating Ezra and Larry

as a team. I would love to change. I

just want to make sure to change all

here. You mean the Democrats didn't want

to see if we can cause Let's see if we

can Larry won't even admit that PNTR did

anything. Can we not keep doing PNTR for

a minute? Let's look forward, not

backward. Look at the look at the chips

act. Look at the IRA act. They did the

exact things we're talking about. Larry,

go ahead. Let's see if we can find a

little bit of agreement, please. Here. I

agree with Chamath's agenda. I I may not

agree in every detail, but I broadly

agree with Chamath's agenda. And I'll go

a little further than that, Ezra. I

think Joe Biden's attachment to energy

security was kind of selective and

heavily oriented to green technologies,

not others. I thought cancelling the

Keystone pipeline was a clear mistake. I

thought the stopping a variety of things

involving liquid natural gas were a

clear mistake. So I think the Biden

administration's approach to regulation

that empowered every NGO with respect to

stopping transmission lines with respect

to constructing power plants because of

the importance of democratic

constituencies was a mistake. So I think

energy security is a central objective

of policy and that there's a lot of room

to move beyond what the Biden

administration did. I actually believe

that very strongly and agree with

Chimath and David. What I don't

understand

is chips absolutely right. The chips act

was all about making there be an

American semiconductor industry with

production in the United States as a

central priority. The Trump

administration has declared war on that

rare earths. You want to have a

strategic petroleum reserve for any rare

earth. You want to do more mining in the

areas that Chamath says we should in the

United States or in friendly countries.

I am all for that. Here's what I cannot

understand.

Chamath. They don't see how your

resilience agenda drives anywhere near

liberation day and the emphasis on uh

tariffs. It drives towards a set of

specific industrial policies perhaps

including tariffs in some particular

product areas but steel from

Canada, anything from

loto, any natural resource uh product

across the board tariffs on everything.

I think you are absolutely right about

resilience and that traditional

conventional economics has given it too

little thought and that co pointed that

up as a central issue. What I can't

understand is why Donald Trump's echoing

of Liia Koko from the 80s about

tariffs is responsive

to any of that. But but this is the

point I'm trying to draw around Biden.

I'm not saying I agree with every way

the Biden administration defined its

objectives. I just wrote an entire book

about the failures of Democratic policym

in this specific era. What I am saying

is the bid administration's view of

trade was that there are targeted

industries we should be putting a lot of

both uh domestic policy and

international policy into play in order

to protect and reshore or French shore

and the Trump administration's view is

that you have a generalized problem

running all across the world that

requires highly general policies that

then when I ask people to defend it they

sort of move to this targeted argument.

Donald Trump's view, we can I I feel

like we end up making something that is

not that complicated um into something

much more complex than it is. Since the

80s, you know, Larry's point about

Liika, Donald Trump has seem has

appeared to hold the view that anytime

the US is operating at a trade deficit

with someone else, that is uh evidence

we are being ripped off. And that is how

you get at least the initial set of

tariffs here that work off of bilateral

trade deficits and try to correct every

single one with every single country be

it Loto or a collection of islands

inhabited by penguins. I I just I think

it's really important to be connected to

the policy that was actually announced

and not sort of projecting all of our

own onto it. Like yes, Larry's right

that you could have a different set of

critical industries than Biden did. The

Biden team was very focused on clean

energy over other kinds of energy. I

also did not agree with like the liquid

gas pause. I thought there were some,

you know, there and we did not do nearly

enough on things like permitting reform.

Right? There's a lot you could have done

that they didn't do. But if what you

have in your head is a targeted idea of

reshoring specific industries or

nearshoring or frenching or whatever,

which is kind of what I'm hearing from

um from a number of people on this call,

then it seems like you would want

targeted policies. And what we have is

not targeted policies. It's broad-based

policies, a 90-day pause on larger

broad-based policies and a huge trade

war with China. I would like to hear a

defense from somebody.

Ezra and I agree specific policies. I'd

like somebody to explain to me why it's

a remotely sensible theory to say that

the United States is being exploited by

any country where the overall pattern of

trade is uh such that we are running a

trade deficit and maybe in the process

you could explain to me why my grocery

store is exploiting me because I'm

running a massive trade deficit with

that. Okay. Trade deficit. Shimath or

Sax who wants to take it? I can start

the then maybe Sax can Saxon. So let let

me actually start by giving some credit

to where Biden did do a few things right

just in the spirit of finding some

common ground inside the IRA. I think

that there were two things and I've said

this pretty repeatedly but I just want

to put it on the record again. The ITC

credits and the ITC transfer markets for

those credits, the tax equity markets

are critical industries in America to

support private investment in all kinds

of very complicated markets, energy

markets being the most important. And

what the Biden administration did to

their credit was remove the uncertainty

because those things had to be renewed

over and over again. and they gave us a

very long window where we could

underwrite investments. To your point,

Ezra, that was smart. But it's important

to also remember that in order to get

Biden's budget done, what they did was

they had Mansion roll over on permitting

reform. And Ezra, you know this probably

better than all of us. When you look

inside of the chips act, as smart as

that initial policy was, if you ask why

has nothing actually happened, why have

no fabs actually been built other than

grandio statements? The answer is that

which you speak to in your book. It's

just this complete malaise and inability

to actually get these things permitted

and turned on even when it's right. So I

just want to acknowledge that that's

there. So Larry to very very importantly

to your question the thing that we have

to acknowledge is that in certain

countries what you have is a very blurry

line between private and public industry

and they have this very tight coupling

and again I hate to go back to China but

it is the best example of this where

what do they have choose one other

country just for the sake of it we can

use Korea we can use Japan we can use

Germany okay there are instances where

the government balance sheets support

private industry. They can support them

in three different ways. Number one is

the tax credits that they can use, the

subsidies that they can use to build the

things that they need. Number two is how

then they can support that in the active

selling and engagement in public spot

markets to shape the demand curve of the

things that are made. And then number

three is the taxation on the back end,

the terms of repayment and the capital

cycle.

Those are things that in the United

States we

overwhelmingly turn the

responsibility over to the private

markets to do. We are the cleanest, the

purest form of capitalism in that sense.

But many other countries are shades of

this. And again, let's not talk about

China, which is the So, so Larry, hold

on a second. So, Larry, so what you have

is how do you defend dumping? How do you

defend that? How do you defend spot

market manipulation that drives American

companies out of business? How do you

fight that? And I think here's the

problem. If President Trump had

announced a big broadening of

anti-dumping law to confront a variety

of instances of what he what the

administration after careful economic

analysis saw as inappropriate

subsidy. I might or might not have

thought that they were doing that in the

right way, but we wouldn't be having

this argument. The front pages would not

be about tariff policy day after day and

the stock market would not be down by $5

trillion.

The central thing we are discussing is

not whether there are sensible

modifications to trade policy to respond

to bad practices in other countries or

to promote resilience. Those are

technical debates that frankly aren't

that interesting to a large number of

people. The question is whether

declaring that we need a whole new era

of US economic policy

around universal tariffs against

everything

is so I

think is a rational step forward or

using bilateral trade

surpluses now we're talking about the

Monte Carlo simulation of how to achieve

the outcome and what I am saying is

there is just as much as you and I want

to guess. The fundamental and honest

answer is none of us know. The people in

the White House, what they know, they

will share a little bit at a time.

Because the reality is if you what you

wanted was a white paper or if what you

wanted was paint by numbers, I think

back to David's point, all that would do

is just take any leverage that they had

and give people the opportunity to shape

their response. And I think in

traditional game theory and and again in

traditional game theory, I think the

right thing to do is when you're playing

poker, you play street by street. What's

the flop? Make a set of actions. What's

the turn? Make a set of actions. What's

the river? Make a set of actions. And I

think if you're going to play to win,

this is what they should do. Keep their

cards very, very close to the vest.

realize that you can't necessarily

surgically go and attack the lithium

market first, then the rare earth market

second, because it all goes back to the

same balance sheet. It's the same actor

over and over. I think there's a useful

analogy to draw here. I think a lot

about an article Mark Danner wrote in

the New York Review of Books many years

ago about the Iraq War and it's an

article that has stuck in my mind

forever because what he says about it is

that one of the the difficulties of the

politics of the Iraq war is there was no

one war. There was everybody's private

war that they were projecting on to the

Bush administration. You have the

liberal humanitarian vision of why we

were going to war and what that war

would look like. You had a realist

vision for it. You had a vision that was

more about uh weapons of mass

destruction and keeping the homeland

safe from terrorism. You had people

believe there was an Iraq al-Qaeda

connection. There were really dozens of

these which is how you got as broad a

coalition behind as bad a policy as that

together because everybody said, you

know, they're being a little bit vague

about what's really going on here and

why we're really doing this. But I bet

you if you go into their heart of

hearts, what they want is the thing I

want. Even though the policy doesn't

quite match what policy you would get

from starting from my premises. And

that's really what I hear here. I hear

it on this show, but I hear it in

general in the discussion around this

that there are a lot of different

objectives being projected onto Donald

Trump and his trade war. The objectives

do not fit the policies we're seeing.

the objectives are not uh stably

articulated by Donald Trump or the

people around him. Nor is any specific

objective being articulated in a stable

way without contradicting objectives

also being articulated at the same time.

And look, maybe in the end, and this is

why I want to push you all on metrics,

you get something you like out of this,

but you're giving away a lot of clarity

just on the trust that what is happening

is people are keeping a good hand of

cards with a good strategy of poker

hidden from you as opposed to what's

happening is what we seem to be seeing

in public, which is Donald Trump is a

chaotic and erratic person. They are

making policy in a chaotic and erratic

way. That policy is having chaotic and

erratic consequences. And then they are

operating and moving on the fly in a

chaotic and erratic fashion. Sax, you

heard Ezra say that they he feels this

administration is being a bit chaotic in

the approach here. What's the counter to

that? You heard Shamant say, "Hey, this

is a really thoughtful. They're holding

their cards close to the chest." Maybe

you could clarify what your position is.

Is this too chaotic or is this crazy?

What I'm hearing is a bunch of process

objections to Trump's policy and I'm

hearing a bunch of nitpicking. What

about Lutu or whatever? Okay, look, this

is a very unrealistic view of politics

when we've had a bipartisan consensus in

Washington for decades that unfettered

free trade is a good thing. No matter

how big our trade deficits got, no

matter how rich and powerful China got,

no matter how unfair the trade practices

got, no matter how many millions of our

jobs and factories got exported

overseas, this has been the bipartisan

consensus in Washington. And Larry,

you're right that it started before the

Clinton administration and the George W.

Bush administration definitely

accelerated it, but there has absolutely

been a bipartisan consensus in

Washington that this sort of unfettered

free trade policy was good for the

country. Now, how do you change that?

Now, look, you can nitpick this and you

can make all the process objections you

want, but Donald Trump has changed the

conversation. I just want to let you

keep saying I I've offered a process

suggestion when I'm objecting to the

absence. Can I finish? You were pointing

to Donald Trump's views when he was a

public figure in the 1980s and 1990s on

trade as somehow he was wrong. He was

not wrong. He was one of the few people

and the few public figures in America

who was right about this. I think most

people today would say he was right

about this that throwing open our

markets to these to these foreign

products without thinking about the

consequences was a mistake. You guys

have me completely confused. Really? You

do. No, I'm confused about the

incurrence of your position. Larry,

Larry, David, you still believe that the

Clinton administration, let's call it a

bipartisan consensus of that era, was

correct, while at the same time you're

arguing that PNTR didn't do anything. I

think it is really telling that you are

so much more loathed to defend what we

are seeing than to attack what has been.

If you want to, it's fine. Like, I guess

you could have It would be interesting

to have you and to go if you'd be

interested to have you and Larry go 12

rounds on the Clinton era. You know when

I say to you, listen, there is not a

stable set of objectives that fit the

policy here. You say that's a process. I

just would like somebody to defend the

thing they keep actually doing. I would

like somebody to explain to me here. I

understood Chimath Chimath resilience

central four sectors. Are we more

resilient in the four sectors? What's

the answer in two years from now? I got

that. I agree all that. I cannot make

any linkage between a 10% across the

board tariff, a tariff on steel, a

tariff on auto on

automobiles, and much of what the rest

of the president says and your very

valid objectives. I hear

David this free trade has destroyed

America and we're gonna undo that and

viscerated the heart and all this and I

just want to understand how we'll know

okay whether we have fixed okay look

well I I can answer this too go ahead go

ahead David all right look Larry and

Ezra welcome to a political coalition

different people have different

objectives just like different people

had different objectives for the policy

that we had in place 25 years ago okay

there are some people who think that we

should have an across the board 10%

tariff to raise revenue because the

country needs revenue and that that

would be a better way to raise revenue

than to say have income taxes or capital

gains taxes. Stan Ducken Miller, who's

not a fan of tariffs, nonetheless said

that he would support a 10% tariff, no

more than 10, but up to 10 as a way to

raise revenue. Okay, that's his point of

view. There are other people, and I

would say I'm more someone who thinks

about the geopolitical consequence of

this, who think it was a huge mistake to

throw open our markets to Chinese

products, basically feeding their

economy to the point where they could

become a pure competitor of the United

States and threaten the US to threaten

the US world order. There are different

people. Hold on. There's different

people with different objectives. One

more time because you're you are just

not speaking truth.

want to know one restriction that the

United States had on Chinese products

that was changed in the year 2000.

You've said seven times throw open our

market to Chinese products. I want to

know one example in which the United

States opened its market in

1999 the point just one the point of

Well, the name one product where

restrictions were reduced. Okay, David

Namon, listen. You're mischaracterizing

what PNTR did. We can play this like uh

Grock game if you want. People can go

ahead and grock this question and

they'll get this answer. Look, the

answer is that before PNTR, China was

granted MFN on a year-by-year basis by

Congress. Correct. PNTR made it

permanent. What does that do? It created

a permanent new framework for trade

relations between the United States and

China. So it it created permanence and

it created a certain expectation. What

did that enable? Massive investment by

US companies in China. So all the bean

counters from McKenzie started talking

about outsourcing and just in time

manufacturing. They started moving the

factories over there in a much greater

way. You know the Mitt Romney and

private equity. Hold on for a second. We

finished. The Mitt Romney and private

equity said this is a great idea. Let's

move all of our manufacturing. Could we

agree that whether or not it was the

WTR, the bankers on Wall Street got to

financialize and securitize all sorts of

new products, okay, that was the result

of PNTR. The thing we have to decide

really right now as a country is if the

thing that you all are trying to replace

us with is better, right? If it will

work. And so I want to go back to what

you said a minute ago, David, when

you're like, "Welcome to political

coalitions." Uh Larry has been in

politics a long time. He was Treasury

Secretary. I've covered politics for a

long time. I'm familiar with political

coalitions. In fact, a lot of my book is

currently about the problems in the way

the democratic coalition with too many

objectives all at once can end up

destroying the ability of the policy to

actually achieve a clear goal. So this

is this is precisely the nonprocedural

objection I am bringing here. This is

why I think it is dangerous to be

treating an upheaval of the entire

global financial system without a

clearly defined objective that is

connected to a policy. And so the the

question is if the idea is that there

are all these different players here who

have all these different policy

objectives that would connect to all

these different policies and everybody's

getting a little bit of them and Trump

is kind of flipping back and forth

through different versions of them. You

could end up despite yes whatever

mistakes are made in the free trade

consensus which I do agree that we had

you could end up with a bad next not

even consensus just a bad next policy a

unclear coalition that is fighting with

itself and is making policy without a

strong process can create not like

nitpicky procedural problems but actual

damage and disasters. Shimoth let's look

let's try to look forward here this

obviously has been a cataclysmic chaotic

intense whatever descriptor you want to

use of the past week productive is okay

sure and it certainly created massive

swings in the market is this all going

to cause a recession is this too violent

of an approach to markets that is I

think a valid uh criticism that people

have including you know the majority of

business leaders are saying, "Hey, I

think I have to start layoffs." You had

United Airlines say, "We're not going to

give any guidance." This feels to

business leaders, Republican business

leaders primarily, and market

participants as just far too chaotic.

And they can't plan. And if they can't

plan, then they stop planning, which

then is going to cause layoffs. It's

going to cause bankruptcies. And uh who

knows what the second and third order

consequences are going to be. So, what's

going to happen here over the next

couple of weeks and months? So, just on

the recession question, and then I'd

like to give an answer to Ezra and

Larry. I think that, and I've said this

for about a year, it was clear to me

that we were sneakily in a recession

before. And the reason was the vast

amounts of money and deficits that were

being pumped into government services

that perverted the actual GDP picture in

America. So, as Doge sort of slows down

that money flow and as the consensus in

Congress gets to a better budget, I

think that you're going to see that the

government was probably responsible for

100 to 150 basis points of just waste.

And if you take that out, you will

technically be in a recession. That was

independent of these tariffs. And I

think that that's where the true

economy, Jason, was. And I think that

we're going to just find that out. So

that's that on where we go from here. I

can give you an anecdote and I'll give

you a projection. The anecdote is this

weekend my wife and I were in bed and a

person called me very successful

businessman who was representing the

president of a country saying, "Hey, I

need some advice. What do we do here?"

And we walked through the three things

that he and his government that they

government were trying to figure out

because they wanted an off-ramp. They

were like, "I'm ready to cry, uncle.

We're ready to tap out." And again, he

was calling me as a private citizen, but

I think this conversation was very

instructive. Number one, he's like,

"Look, we have these really high tariffs

on inbound American products. We're

happy to cut these things to zero." And

I said, "Well, you should do that."

Second, while we were exploring, he's

like, "Yeah, you know, we have a

enormous capital purchase with Airbus."

I said, "Cancel it, swap it to Boeing."

He's like, "Done." And then the third,

which was interesting, is he's like, "We

need to import an enormous amount of

energy." And I said, "Well, who do you

give that concession to right now?" And

it was a non-American company. And I

said, "Well, why wouldn't you just RFP

that to an American business and let

them

compete?" And he's like, "We'd be open

to that as

well." So he said, "You know, we're

getting prepared. We want to find a way

to talk to the Trump administration."

And I'm like, "Great. However I can be

helpful, I'm help I'll be helpful to

you." I got off the phone. And I looked

at my wife and I said, "If even 30 of

these 75 countries do a deal anywhere

remotely close to this, this was an

enormous win." So let me give you my

projection, Jason, of what the art of

the deal could be here. What you do is

you can rewrite Bretonwoods 2.0. What

was Bretton Woods 1.0? It was fixing

exchange rates. It was setting up the

IMF. It was setting up the World Bank.

Those were the conditions on the ground

post World War II. It made a lot of

sense. What would we do if we had to

write the Mara Lago accords right now? I

think what we would do is work backwards

from the question that Ezra asked and

the answer that I gave. How do we create

resiliency in these critical markets?

Number one, a framework for that. Number

two is how do we create limits for

government sponsored intervention

against capital for-profit companies,

many of whom are

American, so that we can actually

compete on a level playing field. And

then number three, very simply, if you

can do business in my country, why can I

not do business in yours? And I'll just

give you that story for one second. I

was responsible. I was the head of every

single entity of Facebook outside of the

United States. I opened every market. My

team and I created a framework for

dominating. I figured we figured out how

to crack Brazil, India, Russia. You

know, the one market that we never could

ever make a single iota of progress. Say

it Jason with me. Well, China, China,

China, Russia, no Iran, we won in

Russia. So my point is in every single

market except one. Is it that we were

just lucky in 174 markets and one we

were stupid? No. So I think that the

moral accords this sort of Brettonwoods

2.0 is the outcome, Ezra. It will

basically use tariffs as a way to get

these governments to a table and allow

us to negotiate a much fairer economic

quid proquo. Here's my concern with with

this theory and I want to leave out but

I'll leave the the sort of question of

what the real economy looked like to

Larry. this world in which what is

happening is a business leader who

represents a country is calling you and

saying okay what do we need to do to

deal right they're coming to Donald

Trump and they are going to come to

Donald Trump as Larry said earlier

there's no doubt that the US economic

leverage is enormous and virtually every

country faced with our might is going to

try to cut a deal with us but then

there's a call they're not making to you

that they're making to someone else

which

is we have

allowed or we have approached the US as

a functionally benign partner for a very

long time and now they're becoming a

dangerous partner. They are very very

strong and they will use that strength

to crush countries smaller than them

when it suits the whims of a personalist

regime run by a person who his feelings

even about people that the US or

countries the US traditionally

considered allies like Canada or much of

Europe uh change. And so yes, on the one

hand, for the next year or two, we want

to avoid getting a big tariff slapped on

us. And so we got to figure out what is

it that if we offer it to Donald Trump,

he will say to himself that was enough

uh of a give that you know I can move on

to someone else. I can make them the the

focus of my eye. And on the other hand,

they're going to begin to build

fortresses and deals and partnerships

and approaches that make sure they are

less exposed to our ability to wield

this power against them in the future.

But before I came on the show, I had

gone on X and I saw a clip of you going

around where you were saying that one of

the problems with the Biden

administration was that you couldn't get

anybody on the phone. And in the Trump

administration, you make the call, the

deputy chief of staff picks up. You say,

"Hey, I need you to talk to to this

company. They I work with them. They're

freaking out about the tariffs. The

deputy chief of staff tells the company.

They they work something out." No, no,

not that they work something out. They

listen. They listen. this this world in

which we are doing the dealm by

individual relationships by who can get

their calls answered not by rules that

feel clear and stable that's how the

Hold on a sec but that's how the Biden

administration worked that's not what

said that's not what I said well no Ezra

you're trying to make it sound like

corruption hold

on it was George Clooney that was making

the call who cares what George Clooney

thinks didn't you just say on uh well I

was very very critical of Biden

I saw that clip Ezra and what Jamas said

what Jamas said is simply that the White

House listens when he calls whereas he

couldn't get his calls returned by the

Obama administration. Great. I think

we're actually not saying something all

that. You made it sound like corruption.

Well, I actually think what Trump is

working through is deal patronage based

on how he sees the company. I'm sorry,

the other country. What happened? Ezra,

can I just make sure that this is clear

to you? This is a 150year-old American

business. I have no interest in that

company except a friendship. These are

Americans hiring Americans trying to

compete with China who were very

negatively affected. And all I said was,

why don't you have a chance to explain

what's happening on the ground? My point

that I was trying to make, and maybe I

didn't make it clear enough, so let me

set the record straight. The Trump

administration, what I have seen as a

businessman is willing to hear the

conditions on the ground. As a

businessman, when I was building, Ezra,

just to be clear, critical rare earth

supplies for America under the Biden

administration, battery can materials to

compete with China under the Biden

administration, AI chips to be the best

inference solution under the Biden

administration. I couldn't get a call

back. That's just the facts. Not because

I wanted anything, just to tell them

what was going on.

So fair enough. Insane. Okay, fair

enough. I I am not telling you that the

B administration shouldn't have returned

your calls. What I am saying is that the

degree to which Trump first and then

everybody around him as an example of

him because culture comes from the top

is working off this kind of individual

call and deal making worries me because

I believe that you had every one of

these calls you're saying and they went

exactly the way you say they went and

then the calls that you are not getting

and they are two minutes ago Ezra you

were saying that a 10% across the board

tariff was too broad and we need to go

industry by industry and now you're

saying that it's going to be too

particular and he shouldn't do country

by country negotiations. The word

dealing people listening to people is

not deal making Ezra it's just listening

to people. Are you really going to be

tell me that the way Trump himself works

is not individual deal

making people with

Is this really is this really the

argument here? I will tell you what I've

seen and David's seen much more. What I

have seen from the president is he takes

in hundreds of opinions and starts to

figure out what the ground truth is. And

the reason is when you only listen to

one or two, every president probably

deals with this. You have this

information asymmetry problem because

you are the president of the United

States. And so how do you cut through

it? You talk to hundreds and hundreds of

people and you triangulate what the

truth is. So it's not like he's giving

any favor. He's collecting information.

That is a good process. You want the

most powerful person in the world to get

to the ground truth. Go ahead, Larry.

I am all for information gathering. I

agree that the Biden administration did

not do a as good a job as it could have

of maintaining relations with the

business community. I agree that it's a

good idea for there to be quite

extensive connection.

I am also appalled by the halfozen phone

calls I have gotten from prominent

people in business who have said, "I'm

used to being shaken down when I try to

do business in some parts of the world."

It's a new experience to be shaken down

by representatives of the president of

the United States. What's the shake

down? When you have close connections,

you help us, you contribute this way,

you no sense at all. Makes no sense.

What the president has been trying to do

is encourage

domestic maybe it is an erroneous

perception to which I have been exposed

repeatedly. But it is total nonsense.

But it is a pervasive total nonsense.

You guys are very confident that your

true and everybody else's aren't. It is

a perception that is shared by almost

everyone who has experience in the

conflict of interest area who has looked

at the situation of Trump administration

officials and those working as special

government employees in the Trump

administration. What are you saying? So

I just went through that whole process,

Larry. It will be false, but I can speak

to this cuz I just went through this

process. It took forever. It took like

months. Okay. I went through the same

process everyone else goes through. The

OGE career staff have to go through all

of your disclosures and they figure out

what the conflicts are and then you have

to devest them. Okay. It's the same

process everyone goes through. So,

you're all over the place making all

sorts of accusations here. So, if you

have some proof or you want to accuse

someone, then why don't you just do it?

But otherwise, what you're saying is

just not true. It's not backed up by

anything. Great. They shut down Eric

Adams. That's my That's a direct

accusation that happened in public. They

shook down Eric. They shook down Eric

Adams because they put him in his

pocket. That's a big deal, y'all. Like,

that is the way they are doing business

here. You guys are all over the map

making wild accusations. First, it was a

second resations because of their

discomfort with being overruled by your

colleagues in the Trump administration.

So the suggestion over the map you have

been held to the same ethical standards

that I was held and that other members

of previous administrations including

the Bush administration were held

unfortunately is not right. No that's

that's false. All right. Well, there's

two issues. You may not be familiar but

I had to devest. Hold on. I had to

devest a lot as I talked about on this

show. In any event, you guys are all

over the map making wild accusations.

Two seconds ago, the shakeddown was at

the level of companies. Then all of a

sudden, it was OG and ethics. Then it

was something about Eric Adams

integrated business. It's nobody's

making I like that you're like, "Who's

Eric Adams?" We're not making I know who

Eric Adams is. I supported him on this

show forward way that Trump does

business at every level at which he

operates. And so it is happening at

every level of his administration. You

know, I got to say I don't It's not that

I It's not that I don't want to hear

you. I don't want to hear it. You know

how this started is because Hold on a

second, Ezra. You misqued something

Chamas said on another podcast where all

he said was that I can get my phone

calls returned by this White House where

I couldn't with Obama or Biden even

though I was a big donor. Hold on. And

you guys have somehow morphed that into

some sort of like broad ranging

accusations of corruption or something

like that. No evidence clear about what

the accusation of the way Donald Trump

works is. Ezra, your accusation of me

tried to infer some form of corruption

or some form of dealmaking. None of that

happened. What I what I again I'll tell

you I connected the White House so they

could hear on the ground what's

happening from a company who was very

negatively impacted by the tariff so

that they had the complexion of that

feedback as well. Okay. Do you deny the

possibility that your experience with

the Trump administration might be

different than people who they feel are

less allied to them than you are? Ezra

I'm will I'm willing a straightforward

question. What are you sure that you're

a good sample? I don't even know what

we're talking about anymore. Also, I

think what we're talking about right now

is that people who donate to politicians

have unique access to politicians. I

think we can all agree that's not true.

Just to be very clear, I give I have

given way more to the Democrats than

I've given to Donald Trump. And you were

disappointed about that. I didn't say

anything about your donations said about

where your ally now. And by the way,

like what what's crazy is I was the same

intellectual person I was under Biden

that I am under Trump. It's just that it

seems like the Trump administration is

like, "Well, this is a smart guy with

some opinions. Let me listen." Biden, I

And by the way, and Larry, you and you

know this, these were some very close

friends of ours that we share mutually

that would not even return my calls. So,

it is a little personal for me as well,