Over the past month, there are two

dominant stories in American foreign

policy. One of course is the war with

Iran. The other is the much anticipated

summit between President Trump and Xi

Jinping of China. And I think if you

look closely at both of these stories,

you see that our foreign policies

entered into a period of absolute and

complete incoherence. Donald Trump said

that the point of the war with Iran was

to end the threat of the Iranian regime

and to forever end their capability to

get nuclear weapons.

>> They will never have a nuclear weapon.

This regime will soon learn that no one

should challenge the strength and might

of the United States armed forces.

>> Now, if you look at what is being

considered, it appears that neither

policy is going to be achieved. So, what

are we doing there? What are we trying

to achieve there? Now, and if you look

at President Trump's entire time in

politics, he's been committed to nothing

so much as changing America's

relationship with China.

>> We can't continue to allow China to rape

our country. And that's what they're

doing. It's the greatest theft in the

history of the world.

>> Containing China, making sure we have

power in that relationship or we begin

to detach from it. But if you look at

our policy not towards China and you

look at that summit with China, are

either of those things happening or are

we in fact moving in the opposite

direction?

>> The American and Chinese people share

much in common. We value hard work. We

value courage and achievement. We love

our families and we love our countries.

Together we have the chance to draw on

these values to create a future of

greater prosperity, cooperation, and

happiness. There is much I disagree with

in Donald Trump's foreign policy, but at

the moment, there's just reality that

it's not clear what it is. It's not

clear what he is trying to achieve or

what he is simply settling for or

reacting to. So, I wanted to do an

episode looking at China, Iran, but also

just trying to assess Donald Trump as a

geopolitical force and as a force that

is remaking what America means and what

its role is in the world. Ian Bremer is

the president and founder of the Eurasia

Group and gzero media. He's also the

author of among other books, Every

Nation for Itself: What Happens When No

One Leads the World. As always, my

email, Ezra Klein Show at NY Times.com.

>> Ian Bremer, welcome to the show.

>> Ezra, good to join you. So, I was going

to do like a direct into the news

question on Iran, but I I was reading

your global risks report from the

beginning of the year, and it made me

want to ask a bigger question first,

which is

what to the meaning of Donald Trump?

What does he historically and

geopolitically represent?

Um, I would say he's first and foremost

a symptom, not a cause. Uh, of of trends

that have been coming in the United

States for a long time. Uh, uh, American

people that believe that for various

reasons that the political system does

not represent them adequately. Uh, that

something about it is broken. and needs

someone who's going to shake it up, who

isn't going to be an establishment

figure. Uh I think that you see that

reflected in a whole bunch of structural

policies like a lack of US support for

free trade and instead moving towards

industrial policy and nearshoring and

inshoring. You see it um in a move away

from more open borders uh both in terms

of response against illegal migrants but

also restrictions on legal migration. Uh

you see it in an unwillingness of the

United States to get as involved in

foreign wars and uh a demand for much

greater burden sharing and other

countries paying for their own defense.

Those are structural things that Obama

had to deal with and Biden had to deal

with and Trump is benefiting from. But

then you have a separate group of things

that have to do with Trump the

individual where he puts himself above

the country. I mean I was in Davos in

January and wasted three days of my

life. I will never get back on

Greenland. Right? That was not a thing

for US national interest or foreign

policy. That was purely vain

gloriousness on the part of the US

president to be able to put his name and

plant his flag on a territory um that

has um some of the strongest alliances

around it that the United States could

possibly rely on but which don't matter

to Trump because he's not getting what

he personally wants. And there are many

examples of the latter um which are not

as important for where geopolitics are

heading over 5 10 20 years but they're

really important for some of the

conflicts that the US happens to be in

and how they're addressing them right

now. And of course they also play an an

inordinate role in driving the headlines

and the conversations that you and I

frequently end up having.

>> So I take that point that Trump is

symptom not cause but then he becomes

cause. One of the ways you have

described Trump,

which I've not really heard many people

say, is as the generator of a political

revolution, a kind of upending

of the American state and the way it

works and the expectations one should

have of it on the level of FDR.

>> So, talk me through that comparison. Why

FDR and and what then is Trump's

political revolution? Well, FDR was the

last time you had a president in the

United States that was truly interested

in upending the checks and balances that

existed on the executive and in

transforming the nature of US power as

manifested by the government. Uh and

there were some things that he tried to

do that he failed at like packing the

Supreme Court to 15 members or like uh

throwing out purging a number of the

members of his own democratic party who

had been democratically elected. But

there were a number of things that he

succeeded at like creating a

professionalized administrative state to

actually do the business of the

government that was independent, that

was technocratic, that did not exist

before, like the New Deal, the

infrastructure of the country that was

built, that allowed a middle class um

and a working class to emerge in a

stable way over several generations

coming out of the guilded age and the

Great Depression. Um, now a political

revolution does not have to succeed and

a political revolution does not have to

be for for goals that you or I happen to

agree with. But the structural condition

of a people that are demanding a

political revolution, that is something

that will persist if it is not

satisfied, if it is not satiated. And so

what I see right now is President Trump

uh driving a political revolution. He is

attempting every day to end the checks

and balances on the US executive. And

you and I can come up with many examples

of that. Many of them he is failing at.

And it is very clear to me, I have a lot

of confidence that he will not succeed

in the political revolution that he will

drive. But it's also pretty clear to me

that um the United the American people

are going to continue to demand um some

very significant revolutionary responses

to a system that they believe is not

responding adequately to them and where

that comes from. Is it the left? Is it

the right? is a new party, what it

happens to address, and does it have to

be a president who is maximally

incompetent um from a policy perspective

or authoritarian in impulse um or is

personally kleptocratic? Those are three

descriptors of Trump that I think apply

to a more extreme version with him than

with any president in American history.

I'm less concerned about the revolution.

it it is a natural response to a system

that's not seen as performing. But there

are lots of reasons to be concerned

about what President Trump is doing. So

one of the reasons I thought the FDR

framing was interesting is that what I

think gets right is that FDR

exerted tremendous power sometimes

through in ways that followed American

norms, sometimes in ways as you know

that didn't to build professionalized

structures. Yes,

>> this is what is always very interesting

about FDR. He's somebody who could have

become a dictator. And what he creates

is a highly professionalized

administrative state.

>> He could have become or really asserted

America as a global hegeimon in the old

style, but instead invests in things

like the UN. And that is not to wipe

away all the ways in which we did use

power, but out of him come the state as

we know it and the global order as we

know it. And those are the two things

that not just Trump but Trumpism,

>> project 2025, the foreign policy

thinking of the people around him have

really come to target. The

administrative state to them uh is a

>> the deep state.

>> The deep state, a tool of weaponized

liberal control. Mhm.

>> The global order is a way that America

is instead of being the power that acts

upon the world is being restrained from

using that power and taken advantage of.

And so there's been a an extended now

concerted effort to to do something to

both of those orders, right? To do

something to the state, to do something

to the global order. So, how would you

describe the aim of Trump's political

revolution? If if if FDR wanted to

construct,

does Trump just want to destruct? Does

he want to own? Does he want to

transact? What is he trying to achieve?

Well, it's why I focused on the

narcissism uh that that he is above the

law. It should not apply to him. It

shouldn't apply to people around him. he

can have his own former personal

attorney as the attorney general, acting

attorney general of the United States,

and he will weaponize the legal and the

judicial system in ways that he

perceives it was weaponized against him.

But the reality is what he's doing is

far far beyond what we've seen before,

just as we've had corruption in the

country and we and it still persists

across the political spectrum. And yet

what Trump is personally driving is

unprecedented in American history. So I

do think a lot of what he's trying to do

um is uh specific to his personal

character, but I also think a number of

the policies that he has been driving

are policies that are broader in terms

of the more revolutionary aspect of what

the American people want. So for

example, um we come out of Iraq and

Afghanistan.

Trump was the one that basically cut the

deal with the Taliban to get the

Americans out of Afghanistan. Now, a lot

of people will say, "Well, that was a

bad deal and you gave away the door to

them." But most Americans would say

ending 20 years of a failed war with

trillions spent and hundreds of

thousands of American lives disrupted to

say nothing of what happened to the

civilians in Afghanistan. Ending that

was a positive thing. Trump got that

done. Biden finally, you know, sort of

got the troops out.

>> Well, they didn't they didn't like it

when Biden actually Yes. finished that

job.

>> Well, a lot of people, I think, were

very happy to have it over. So, again,

>> that might be right, but it was when

that's when Biden's approval rating

dropped under 50 and never recovered. I

always found that interesting because

everybody says people hated the war, but

they didn't like the they did not like

what it looked like.

>> They didn't like the America began to

withdraw

>> of the planes and the people hanging off

of it and all of the rest. They wanted

it to be cleaner. let's say it looked

like an America's leaving Saigon and the

embassy uh moment. Um and so I

understand that. But the the broader

point I'm trying to respond to here is

that there are an awful lot of Americans

that like the idea of the US should stop

with all of these foreign wars that are

thousands of miles away and have very

little to do with American interests.

And so if Trump goes to China and says,

"Yeah, I'm not gonna I why why do I care

about giving military support to Taiwan,

which is 9,600 miles away?" Most

Americans, not the establishment, not

the Republican establishment, not the

Democratic establishment, but most

Americans would say, "Yeah, why are we

doing that?" When Trump kicks Silinski

out of the White House and says, "You

don't have the cards." Turns out he's

wrong. But I think most Americans think

we've done too much for those folks.

taxpayers shouldn't be paying for that

when you're not paying for me. Where

Trump then goes wrong, of course, is he

had so much of the message at the

beginning. He said, "Drain the swamp."

And yet it's much swampier now than it

was before. He said, "End the wars and

now the United States is driving what

could be a global recession directly

because of him." him. I was just in the

Dominican Republic yesterday and I had a

meeting with all the CEOs and the

president was there um in front of me

and during

>> President Trump or the president of the

>> No, President Abanad. Yeah. Um and who's

he's a very he's the opposite of Trump.

He actually really cares about extending

democracy and increasing checks and

balances and limits on leaders across

Latin America. That is the that that is

what he wants to see happen. And I said

to all of those all of the leaders in

the room, I mean, basically 98% of their

economy. I said, I know you're all upset

about the inflation that you're seeing

right now. And his approval ratings are

down to about 55 on the back of that.

They were at 70. Um, I said, do not

blame your government for that. You can

blame my government for that. Don't

blame your government. Like literally,

Trump is looking for anyone to blame for

this war. that is exactly the opposite

of how he was elected and yet he has

personally decided he was going to do

and now he can't extricate himself from

and he can't blame anybody for um and so

I do think that there was a lot of what

Trump's initial agenda was about some of

which he has stuck with like actually

securing the border with Mexico much of

which he has completely jettisoned that

that reflects the the sensibilities of

what a political revolution would be in

service of in the United States. And and

they all kind of have to do with with

not that democracy doesn't work as a

system, but rather that the American

democracy has somehow gotten completely

subverted by special interests. It's

coin operated. It's controlled by money.

There's a two-tier system. It doesn't

apply to me. It applies to other people.

I can't get what I want for my kids. Um,

and by the way, I'm super sensitive to

this because my mom was just like that

when I grew up as a kid and she wasn't

she didn't finish high school. Um, she

had a feral intelligence that was very

supportive of her two kids, but it

wasn't books smart. She read the

Inquirer every weekend and she a lot of

the way she felt about her family. I

will steal. I will cheat. I will do

whatever is necessary to support them

because I know the system is rigged. I I

think that there's an enormous amount of

that that exists across the country

today in 2026.

>> So here's a question about this because

I largely agree with that diagnosis and

I also agree that American politics is

tremendously corrupted by money

and that sense that the country the

system is not working for Americans.

>> Are Americans right about that? And and

here's how I want to maybe steal man the

other side of this. A couple years ago,

there was this big covering the

economist that based if you look at the

American economy,

>> it is crushing the economies of the rest

of the world.

>> You wouldn't want to be Europe rather

than US. You wouldn't want to be China

where the medium disposable income is at

$6,000.

>> You would want to be Russia trapped in

this morass of a war with Ukraine.

There's no one you would want to be

rather than America. But in this period,

the vibes, so to speak, they just get

worse and worse and worse.

This has been confusing for economists.

If you look at most measures, we're not

doing that bad. Inflation is not that

high anymore. I mean, the price level

didn't go back down, but we're back to

pretty normal levels of inflation. You

have had income growth in the bottom

half of the country. You have people

acting in a way that does not reveal

financial stress. They are spending.

They are taking on debt. They are not

defaulting on that debt. GDP growth is

fine. We're the world leaders in AI. And

then if you look at consumer sentiment,

consumer sentiment about the country is

worsened at the depths of the great

recession.

>> There is something here

>> about how bad everybody thinks this is.

>> So how do you understand

>> this sort of divergence between the ways

that people would have looked at like

the outputs of a system before, right?

What is a system supposed to be creating

American prosperity and American power?

And we were getting a lot of both. And

also people hate it and they feel like

it is failing them as never before. So I

I'm really glad Ezra you you framed the

question that way because I think

there's a lot of truth to what you're

saying. I also think that there are

really good reasons that are legitimate

for why Americans feel increasingly hard

done by. But let's start with the big

picture. The macro. The macro is that um

so Xiinping recently met with Trump and

uh he said we're in a thusidities trap

and want to avoid that because that

usually leads to war and throughidities

trap so that everybody listening here

knows what it's all about. It's that

historically when you have a a lead

power in a system that's in decline and

a rising power that's challenging it

frequently I mean the lead power is

trying to hold on to power hold on to

its system hold on to its advantages um

for too long and uh the rising power is

deeply unhappy about that and

challenging challenging challenging and

most of the time historically it leads

to war right that was the the Chinese

narrative and my counter to that uh

first of all is that Xiinping did not

want to be perceived in the United

States as the person that is saying that

the US is in decline. Cuz if he comes to

Washington in September and does that,

he's going to get hammered. It's going

to be very different than the coverage

he gets when he says it in in Beijing.

Uh it's going to be hundred times every

focus. This is what he's saying to

Americans that we're in decline. Screw

that guy. Right? So, number one, he

shouldn't want to do that. But also it

is manifestly untrue that over the past

2030 years the big structural changes in

the world in terms of power is China's

rising. The United States is not in

decline but American allies are

declining and they are declining because

their productivity is down. Their growth

is down. Their demographics are

contracting. They're not investing in

defense. They're not investing in

technology. Now, there has been a stat

that's been bandied around recently that

shows that even Mississippi has higher

per capita income than every European

country. And that is true,

but you would not necessarily be happier

or better taken care of as a citizen in

Mississippi than you would be in lots of

European states. Why? Because the social

contract in Europe actually takes care

of a lot more people. And you see this

in terms of health care and you see this

in terms of policing. You see it in

terms of the educational system,

maternity leave, paternity leave, all of

these things. So let's recognize that um

the the safety net in the United States

does not has a lot more holes, is a lot

more freight, just does not does not act

as effectively as it does in a lot of

other countries. in Canada for example,

in Japan, in South Korea for example,

those things are important. Um, also uh

you have uh a a a system in the United

States where Americans

rightly perceive that if you have access

to funds and network, your kids are

treated completely differently. They

have different opportunities. The

American dream is not for everybody, no

matter how hard you work. Um I I

remember um Operation Varsity Blues and

th this was this I mean we barely is a

blip in today's like OJ Simpson like oh

I remember when uh you had all of these

parents that weren't wealthy enough to

get their names on university buildings.

So they couldn't buy their way in

officially. So they had to buy their way

in unofficially by like you know sort of

giving a bunch of money so that their

kids could get to be on a lacrosse team

to make sure they were in a final place.

But it's like of course it works that

way. And we see that in terms of

absolute inequality numbers in the

economy. We see it in terms of um the

ability of class mobility which I mean

Americans are far less class mobile

today than the Europeans are than the

Canadians are. That's shocking. I mean

like back in the 70s and 80s the United

States had some of the greatest class

mobility in the OECD. And in just 40

years that turned completely on its

head. Um and then you have a couple of

other things which is which is not about

the economy but is really important

which is the grievancebased

nature of the US political system where

you increasingly are electing leaders

that are saying how much that they are

that you are being taken advantage of by

X. Um, and obviously Trump is the

genius, the master at this, but when I

saw Zoran Mandani go outside Ken

Griffin's apartment, and I mean this

isn't some Arab billionaire that doesn't

spend any time in New York and doesn't

spend any money in New York. This is one

of the the guys that actually has spent

the most in developing jobs and his

company in this city. And he stands in

front of this guy's building and points

to the apartment and says, "This is the

problem." that like that's not who

America is. America as a country is

supposed to be everybody builds up.

Everyone has an opportunity. When you

don't feel that way, you start

demonizing these people. And another

part of the problem is that if I look at

the absolute top billionaires in the

country right now, I look at Elon and I

look at Jeff Bezos

um and I I see I look at Mark Zuckerberg

and I see the absolute percentage of

money that they spend on charity on

public policy related things. I look at

their interest in acting as stewards for

humanity as it is today as opposed to

making, you know, Mars safe for humanity

in some undefined future. Like that that

lack of stewardship, that lack of belief

in your fellow American, not to mention

your fellow human on the planet, is

something that I think is driving a lot

more anxiety and in some cases hate. And

that's not to disagree with your initial

question of, well, isn't America doing

great? Sure, it is at the macro level.

>> I'm strong manning a view. I have my own

views on how America is doing, and I

don't think we're doing great, just to

be clear.

>> But no, but but I understand that that

the way you put that out there from a

macro perspective, the US is doing

great.

>> The other obvious explanation here is

inflation. And and let me put the two

versions of this to you to see what you

think. So, one answer to why the

economic vibes in particular are bad is

just we've been in a period of

inflation, right? That's what turned

people on the Biden economy after the

pandemic. And then particularly with the

war in Iran and the tariffs, Trump is

kept in a very salient, you see it on

the gas station board, you see it in the

news way, just driving up prices of

basic things. And so maybe all this is

just inflation. People hate prices going

up. I hate it.

The hard part about this, which an

economist will tell you, we've had much

longer periods of much more inflation

before that. Yes, we had pandemic

inflation, but aside from that, you

know, 2-year period, I mean, inflation

in the 70s, in the 80s, it was just much

much much higher and people were much

happier with the economy. So, how do you

see the prices story? Does that explain

enough of this or not? I think it

matters in the sense that there's

recency bias like you're mentioning the

70s and most people don't remember when

they couldn't afford a mortgage for

their house because you know the rates

were like you know a 10%. And so now

when they so when they were basically

nothing right and then suddenly they hit

5 67 that feels bad and the fact that

this the broad affordability thing after

Americans have been taught that you

don't need to worry about inflation for

decades. I think it's relevant. I think

it is a point. I think the fact that

Trump began his State of the Union by

pointing out that there was a gas

station in Iowa that had gas for under

$2 a gallon and people go and they gas

up their SUVs and they do it every week

and they know what that costs. It's a

very specific price point and then

suddenly it's $4 a gallon. That feels

very very different to them. So I I

think it is a real data point, but the

broader point that you're making, which

is there's something much bigger, much

more structural going on than purely

what you can tease from these economic

data points is essential. Let me take

postprog I'm going to give because I've

been thinking about this question lately

and I have my own answer to it. Um

because I think some of these answers

don't work and and here's why.

>> So the vibes have been bad and getting

worse. And when I say the vibes here, I

mean a measurable set of things about

how people feel about the direction of

the country, how they feel about the

economy, how they feel about the future.

>> And a lot of we can people tend to look

at that and move backwards to things

that they have every right to be upset

about and maybe have been for a long

time. But the social contract, so to

speak, the safety net in the US prior,

at least to the giant Medicaid cuts

>> and affordable care act increases that

are coming in play this year. It has

been better here than it has been in the

past. So we have gotten closer to where

Europe is, not further away. There are

more states where you get, you know,

prek, more states where you get

subsidized childare, more

>> people like Obamacare. People like

Obamacare. Absolutely.

>> But the vibes are worse. They were worse

in 2014, worse in 2016, worse in 2018. I

I think that first you cannot separate

this from attentional platforms. I think

that algorithmic media is negatively

biased. It is towards outrage, towards

anger. But if you just go on X, which

you talked about, is Elon Musk a

steward? I think the thing he thinks he

did that was important for the country

was to buy Twitter and make it a zone of

what he would call free speech so he

could tell everybody all day uh about

the conspiracies that are obsessing him

and about our declining fertility rate

and he could let the neo-Nazis back onto

the platform. And so you have like one

of these central spaces of political

information and uh sentiment

construction has gone from toxic to

unbelievably toxic. And that was the big

social investment of the richest person

in the world to do that to us. And but I

think this is true across a bunch of

them. I think and you and I I think

would both agree that this was not an

actual social investment for the

betterment of the people of

>> I don't believe yes I am not a huge fan

of the way Elon Musk is trying to shape

American and global politics but I think

that he believes he is you know trying

to save us from the woke mind virus and

collapsing fertility and but I think

that sentiment is a complex system and

what has happened is that there are

enough things that have tipped badly

that we've entered into a negative

feedback loop and it's very very hard to

get out of a negative feedback loop

Because there's no one thing

>> if wages go up, it's actually not

enough. Right? People's view, for

instance, of crime, crime is really low

in America right now

>> compared to where it was in the '90s,

for example. I posted on that just the

other day, and people are surprised like

that's got to be fake news.

>> People still feel very upset about it,

right? And and one reason

>> murder particularly. Yeah. And and so I

think what you have is a situation where

there's no one thing, but basically lots

of negative sentiment get like

slingshoted forward on algorithmic

media. This is AI. This is everything

else. And there's just a generalized

sense that things are bad. I mean,

Donald Trump is scary to a lot of the

country. But even to the people who like

him, he's not doing a great job. He's

not doing what he said he would do for

you, right? And it's chaotic and it's

crazy and he is making you afraid of the

other side.

>> Again, it's grievance based. It's

grievance based, but not just grievance,

right? It's conspiratorial. It's scary.

It's people trying to destroy the

country if you don't like them. And in

some cases, right, the stakes here are

very high. Like I do think Donald Trump

is destroying significant parts of at

least what the country has been. And so

I think there's always this effort to

create an underlying material reality to

sentiment. And it's always true that

sentiment has some underlying material

reality. And there's a lot wrong with

the material reality and the way

American politics works.

But I think sentiment has become a

little bit free floating now. And one

reason it is not responsive to the

economy getting better, one reason it is

not responsive to things changing, one

reason it has diverged so much from the

macro data particularly since the

pandemic. Um my wife Annie Larry just

wrote a great piece on this in the

Atlantic is that there is something

happening in the system of attention.

Like I think now a system that has just

moved into its grammar is angry. So

look, I I I think that we do need there

there are there's an interplay between

the independent and depend variable here

to get really wonky, right? Um in other

words, you have underlying issues that

come from free trade, robotics,

innovation that hollows out a whole

bunch of the middle class in the United

States and in Europe at to the advantage

of emerging middle classes in China and

India and the so-called global south,

the former emerging market.

>> I just want to stop on that. What does

it mean to have hollowed out the middle

class if the middle class is purchase

purchasing power etc is higher than it's

been in the past? This is where you have

something tricky happening. I could give

you my explanation, but I want to hear

yours of what you mean when you say

that.

>> What what I mean when I say that is you

have large numbers of communities that

no longer have the same industrial base,

the same civic connection, the same

institutions around them, the the Robert

Putnham B.

>> So this I think is much more specific

and I I wish people would talk in this

language. We didn't hollow out the

middle class. be hollowed out places.

>> Places. Yes, places. But places that

have community and civic engagement and

citizens.

>> But this is important.

>> It's super important and we don't talk

about those are that's a fair point. But

those are the precedents. Those the

antecedent conditions that then lead to

a population that is mostly male that

was that's doing pretty well

economically. Um but um and they're not

all white. Some of them are Hispanic.

Some of them are black. They're living

in poor urban areas and rural areas that

are doing, you know, again, really feel

very differently and are going down

compared to where they were. Uh, and

they're the ones that are voting for

Trump, not once but twice. And the idea

that this can be driven by something

that is vibe based as opposed to real

anticedent conditions. I reject that.

But once you have that, there is a

flywheel. Once you have that, suddenly

those other the algorithmic conditions

really matter. And here I want to really

get into the macro structural for a

second which is that I I had this uh the

first big book that I wrote back in 2006

was called the JC curve and I doubt you

even remember it right it's a long time

ago

>> I who doesn't remember the J

>> exactly it was a small thing um at the

time was big for me and it was about how

um countries did and didn't fall apart

the Jay is the relationship between

openness and stability and that you have

some countries that are stable able

because they're open. Some that are

stable because they're closed. Stable

because they're open, the United States,

Japan, the Nordics, stable because

they're closed, China, North Korea,

Saudi Arabia. Countries that are stable

because they're closed want to stay

closed because if they open up a little

bit, the country can suddenly fall

apart. Countries that are stable because

they're open are more stable than

countries that are stable because

they're closed. And the reason I bring

it up is because it was not only

something that was really really like

kind of promoted at the time as wow this

is a breakthrough. It's also completely

wrong today. It no longer applies

because the world has changed. And the

thing about the world that has changed

is what you just got at. It's

technology. Technology back in 2006 was

actually advantageous to more open

societies. It was the communications

revolution. It was bottom up. It's what

got us the Arab Spring. It's what got

you the colored revolutions in Eastern

Europe and the former Soviet Union.

People that suddenly were interconnected

that could learn more about their fellow

citizens and what they were doing and

organize, learn more about their

governments and their predation and

their corruption even though the

government didn't want them to

necessarily know about that. It

undermined authoritarian systems and it

strengthened liberal societies, open

societies, right? Um then you move from

that system to one where technology is

top down. It's a surveillancebased

system. It's a databased system. It's

algorithmic nudging of people by other

people and even by bots. Um, it's

attentionbased, it's addictive, and it

benefits closed societies, and it

undermines open societies, and it's

creating a level of stress. It's

creating a level of anger, and it's a

level of outrage, but it also has a

political gravity to it, and it's

weakening the United States. And it's

much worse in the US than it is in place

like Japan or even than it is in Europe,

though it's coming in Europe, too. But

the Chinese don't have this problem at

all because they're able to actually

control and nudge what patriotic

behavior is.

>> Let me try something here because I

think this is I want to build on this in

very certain way and get at a difference

between China and America.

>> But but let me take what you just said

in a different direction.

>> I think one of the fundamental problems

in the country is that we have broken

the relationship between technology and

places.

And so we just said a second ago that

the problem is not just that we've

hollowed out this abstract concept of

the middle class because I can show you

like the disposable income of the middle

class on a graph and it does not look

hollowed out compared to 1980. Got it?

>> Like they're richer.

>> But these communities did get hollowed

out. And you sometimes hear, you know,

self-satisfied Democrats, right? This

was Hillary Clinton after the 2016

election say, "Well, the places that

voted for me represent whatever it was

and twothirds or something of the GDP

growth in this country." Right? So,

okay. So, so there's a a redistribution

of opportunity to these cities.

Superstar cities like New York, NSF, and

Los Angeles and Boston, they've gotten

richer and richer and richer and richer

and richer. In the past, what that would

have done is create a new engine of

opportunity. You move to San Francisco

and you're a firefighter, you cut hair,

you do, you know, you work in some job

and then your kids are there and they

get richer and so on. Right? This is

what is happening in China. In China,

the cities are getting richer and there

is this huge movement into them. In

America,

>> those cities made it impossible to build

housing.

>> And Silicon Valley, I was just driving

around the other day where the the part

of Silicon Valley, Santa Clara area,

where you have Meta and Nvidia,

and it is so crazy to me that you do not

have places for people to live. Like

it's just it's strip malls and it's

single family homes.

>> We've not built huge towers connect to

them, right? Like you look at what

Shenzen looks like. And here where we've

invented AI,

it looks like an office park.

>> And this I mean this is a major part of

abundance obviously, but this is the

destruction, the literal destruction of

when we talk about social mobility. How

did social mobility actually work? What

it actually did was places got rich and

people moved to them. But we have really

really good evidence now that that

doesn't happen. And in fact what's

happening is richer people move to

richer places and poor people move out

of them because and this is why uh

there's energy in stepping in front of

you know Ken Griffin's god knows how

expensive apartment in New York is that

the thing is you can't afford to live in

New York anymore and raise a family.

>> And so Ken Griffin, sure he's here and

they've spent a lot of money here. And

I'm not saying New York's housing

problems are Ken Griffin's fault. I

don't think they are. But the feeling

that it has not benefited you that it's

actually true. Like we know this is

true. We know that what used to happen

is that it used to be that people would

move from the poor areas to the richer

areas and now they move out of the

richer areas and into the because they

can afford gentrification. It's not just

gentrification. It is just they cannot

afford to live there. And and I just

want to harp on this for a minute

because I do think it's really important

and a thing we miss. We hollowed out

huge number of communities in this

country and then we gated

we gated the places where the

opportunity had moved to. And so that

has killed mobility. It's not some like

nature of the technology. It's not what

they've done in China. And we've done it

because like the way you used to do this

is you built where there were where

there's money and opportunity. And

instead they've made it very very very

hard to build where there's money. Let's

not lionize China for a second because

you know the only the only way you get

into a city in China is a hooku system

where the state actually gives you the

right to actually move there. They've

overbuilt in some places and the real

estate crisis is massive. All of those

things and you remember that's not just

about cities. It's also about

experiences.

>> Again, I mean the Disney piece that was

done in the New York Times a few months

ago.

>> Do you want to describe this? where they

followed um this woman who was uh

workingass and she had saved up an

enormous amount to be able to get to

Disney with her kids and she did and it

followed um how expensive it was and how

difficult her experience was and how

Disney which used to be the great

equalizer that everyone would go

everyone would be a part of it and and

her experience compared to someone that

just flies in and pays for the skip the

line experience and everything

everything else. And so even a place

like Disney, which is the magical

vacation that all Americans get to come

and have the same experience, has become

completely stratified. And so much of

corporate America is stratifying every

experience you have, not just place,

literally every experience, every ball

game you go to, every every airline you

fly on, every experience Americans have.

If you can make money out of

stratification, you will do that and you

will do much less to commodify. Of

course, the danger and the concern is

that when that happens with AI and so

the people that don't pay for AI are the

ones that get the ads and have

substandard AI that's the four you feed

and the wealthy people can actually be

super empowered and become more than

human because they have AI that's giving

them real information that's actively

curated for them um then can help them

to accomplish things that will improve

their lives that almost every dystopian

near dystopia novel movie in the United

States right now is about some form of

that shifting of America into halves and

have nots where there is no mobility

between the two. And again, it's the

lack of mobility that comes down. You

can't have an American dream if you

can't make it. I grew up in the projects

and I feel like I was the American

dream, but I know how close I was to not

actually making it and how kids I grew

up with that were smarter than me in

high school and in grammar school didn't

make it. And most of the people and I

still I'm Facebook friends with a lot of

them and I go back to Chelsea every once

in a while. The kids that I know in

those neighborhoods now will not make it

to the same degree. That lack of ability

to achieve mobility in a super

stratified society, technologically

enabled, capitalistically enabled, that

I think is what subverts the American

dream more than anything else that we've

done. And this is where I think a lot of

our measures of inequality do not

capture the modern experience of

inequality. You just mentioned how real

world experience is stratified.

Digital experience is stratified. You

turn on Tik Tok, you turn on Instagram

and it is feeding you people living

better lives than you

>> all the time.

>> You are watching the billionaires. You

are watching the influencers. You are

watching all these people succeeding in

a way you're not. Or you're seeing

people who are like drafting off of the

anger that creates, right? Those are

both there. You're watching people who

are better looking than you. I mean, it

is

>> the the kind of comparison it has not

just gender

>> on that one, but I mean, you know,

>> well, maybe better looking than me. I I

take that. Um the the constancy of

comparison.

>> Yeah.

>> And the size of the world you're

comparing yourself to and also the

falsity of it. The way you're comparing

yourself to fake versions of other

people's lives, right? Not their real

life with the diapers they have to

change and the fights with their

partner, but like the fake curated life.

So there's that, right? I think that's a

a contributor to all this, too. But

there's also just like the wealth you

see that you are not part of. Um, and

then I I agree with you on AI. This also

why I think that people need to think a

little bit differently about the data

center moratorum questions because it

sounds like a good idea if you're not

confident in AI, if you're worried about

what's about to happen to try to just

slow down or shut down the data centers.

But what you're going to do is make

compute much more expensive. There's

we're already we already do not have

enough compute for how much people want

it. I think a lot of people on the left

who have sort of told themselves a

story. Yeah. That AI is not powerful.

It's not a real technology. It's

overhyped. It's [ __ ] So then it

doesn't really matter if people don't

have access to it because why would you

want access to the hallucination

machine?

>> Yeah.

>> But actually at its upper levels it's a

very powerful technology now. And if

it's something that the rich can afford

and as you're saying, we get a new

digital divide where, you know, the rich

get these amazing AI agents that are

giving them incredible information and

doing all this on their behalf and

making sure they get the best deals on

everything and they're out there, you

know, sorting the internet for them and

and then what everybody else can afford

is manipulative, crappy, hallucinating.

Um, and you never even meet those

people, right? I mean like in other

words they won't even be part of your

experience because algorithmically

they'll be sorted out. So you would

never date one. Right? I mean again 50

years ago 30 years ago a lot of people

would meet people from different classes

in their community in their schools in

different institutions and you got

intermingling that way. Uh that's

already not happening because of the

gated community issue. Not already not

happening because of corporate

stratification. AI will end that if it

goes in the present direction.

>> Yeah. AI as agents for the rich and

erotica and the simulacrum of

companionship and entertainment for the

poor is a very very dystopian world and

I think people underrate its

possibility.

>> Yeah, I completely agree. And yet the ch

again the Chinese are doing this

completely differently.

>> How are they doing it?

>> They don't believe that AI is going to

be such a huge advantage for the

population as a whole. They really don't

like the Tik Tok model, which is one of

the reasons why when Trump was so

interested in having it, they let him

have it without doing other big parts of

the negotiations to make that occur.

Their focus and they also are deeply

concerned about what it means to have

people in China hallucinate on the back

of AI models. Like, if you're going to

hallucinate, it better be proc stuff. It

can't be GPT, right? Um and and and yet

the Chinese are all in on using AI for

defense purposes, all in on using it for

industrial purposes, all in in

innovating and inventing making sure

that all their strategic sectors are at

and their government is as fully

integrated with the most advanced

technologies as humanly possible because

that's how they project power. That's

how they get growth. So in the United

States, it's exactly the opposite. The

United States says, "We're going to

build these massive LLMs and they're

going to create the singularity and

artificial general intelligence. We're

going to treat intelligence as a utility

and human capital will become supplanted

by token capital. That's what you're

really going to need. But who's going to

have token capital? It's not going to be

most Americans." And so again, the J

curve used to be this idea that more

open societies became more stable

because they were open. But that is

facilitated by technology that makes

that system work well. Suddenly when you

have AI driving more stability for a

closed system like China, at the very

least you would say the J today is a U.

That there are no longer structural

advantages to the stability of a country

by being open if you're technologically

empowered. And if this trend continues,

there would be structural advantages to

closed systems as opposed to open

systems. It's the opposite of what you

want to see.

>> I want to talk about the China US

relationship here because one of the

things that as Donald Trump rose in 2016

and then in 2024 that he was the most

insistent on was the threat to America

was China. And the way in which American

policy had to change was we had to

contain China. We had to stop faffing

around in the Middle East and we had to

be focused on getting over free trade

and recognizing that all of this system

had been used for China to rise and to

allow America to begin to fall and he

was going to change that. We just saw

the Trump Xi Jinping summit. What did we

see at that summit? And and and how does

where we are now reflect the sort of

argument he's been making for years?

Well, no faffing around the Middle East.

There's now lots of faffing. Um, and

China is the big threat to now China's

the leader uh that he treats with the

greatest respect. He talks about a G2

with China. It was a strongly positive

summit from China's perspective. They

consider historic. They consider a big

win. It it helps to solidify their

prestige on the global stage acting as

equals with the United States which is

much bigger, much more powerful. Um

Trump failed uh on on April 2nd,

liberation day. Uh he was the the

intention of the second term was very

much a continuation of the first that

the Chinese were the big threat and he

was going to put heavy tariffs on the

Chinese whose economy was not performing

particularly well and that was going to

force them to capitulate, force them to

bend the knee. He was wrong. He failed.

And when they hit back, they hit back

hard, not just on reciprocal tariffs,

but also then took critical minerals and

rare earths, put a gun on the table and

said, "We will literally shut down your

industrial um production."

>> Describe what that was and why were they

were able to do that. So for some 30

years now, the Chinese have been

investing in um exploitation of critical

minerals and rare earths around the

world that are essential for a lot of

military and industrial purposes, uh

energy purposes, other uh infrastructure

that we all rely on. Um and the

Americans were not investing in it,

thinking, well, it's cheaper coming from

these Chinese sources, so great, we'll

just buy it from them. Kind of like the

way the Europeans decided to get a lot

of their cheaper energy from Russia.

kind of the way all of us decided to get

our semiconductors from a 100 miles off

of the Chinese coast. All of which is

true. If politics don't matter, if

politics matter and you don't trust

those countries and maybe they might act

to make vulnerable your just in time

supply chain, suddenly you have a

problem. And the lock that China had

globally from 30 years of these

investments, including in the processing

of these critical minerals inside China

themselves, suddenly they said, "If you

want to get them, you need a license.

You need to apply for a license to

China. If you're not considered on the

right side of the law with us, we're not

going to provide you with those critical

minerals." And you had suddenly CEOs of

big companies going to Mara Lago telling

Trump, "You better cut a deal with these

Chinese because otherwise like literally

our factory floor is going to shut

down." And so the Americans had to

buckle, had to suddenly say, "Okay, we

got to do a deal with these guys. We

can't afford a trade boycott. We got to

sit down and figure out like, you know,

they give us some on fentinel and we

give them some on tariffs and let's talk

about Taiwan and the rest." And that was

a complete climb down turnaround of the

sort that we've more recently seen with

Trump's war goals in Iran once the

Iranians broke glass pull emergency

lever and shut down the straight of H

for H for H for H for H for H for H for

H for H for H formuz which he thought

they wouldn't do. In both cases Trump's

eyes were bigger than his stomach. He

has a big punch but also a glass jaw.

Can't take one hard from the other from

another side. Um and the Chinese are now

in a position of much greater leverage.

So the summit that you just had was two

leaders sitting together and saying we

must find a way to work together

constructively. You may not like us, you

may not trust us, it's vice versa, but

we will ensure that we work together

constructively so we don't get into a

fight that does a lot of damage that you

don't want to see done. And that was

what happened. So how would you rate

this as a substantive outcome? because

you could say either Donald Trump was

right about the danger posed by China uh

and so this is a problem as he's moving

into this more consiliatory

climb down posture or you could say you

know many of Trump's critics on this

you're being too belligerent these

countries need to work together and

maybe he

fumbled himself into a reasonable

outcome which is constructive dialogue

a relationship between the two leaders

and the recognition that in a world of

global challenges like AI and climate

change and pandemics, it actually is

important that we have good

relationships. And so,

you know, you wouldn't count this as a

win from Trump's rhetoric, but should we

be happy with where this has ended up?

Well, we should be happy that it turns

out that Trump does not have the ability

to commit suicide on the global stage.

If he had persisted with his intended

policy, which was we will force these

Chinese to capitulate to us, the

Americans would have been in a massive

recession and and so would the world.

Um, he backed out. So, is that a win? Of

course, it's not a win. There are big

wins under Trump. There foreign policy

wins. I mean, for example, in his first

term, USMCA, which at the time he said

was the best deal ever. Now he says it's

a horrible deal. But the re I don't care

what he says, the reality was USMCA was

a significant improvement over NAFTA.

The reality is the Abraham Accords were

a big win in creating more stability um

in the Middle East and the Gulf.

>> Yeah. Boy, does that look like a stable

region of the world to me now.

>> It does not. But at the time, it was

something that no one thought could be

doable. and it was a stable it was a

much more stable region until Trump

decided to go in and actually blow up um

the Iranians with Israel. Um so again I

can point to plenty of places Venezuela

on balance a win and perceived as a win

by most populations across Latin America

because Venezuela had been exporting a

lot of instability and now it looks a

lot more stable with a government that

is a lot more attractable and focusing

on long-term economic development. Those

are all wins. China is not a win.

China's a loss. China's a loss because

Trump's intended policy, which is we

need to beat these guys and here's how

we're going to do it, completely failed.

And at the same time, he was pursuing

policies to support himself

individually. Again, Tik Tok, he got Tik

Tok, that that doesn't help the country,

that helps him. It's advantageous in the

same way that Elon owning X is

politically advantageous for Trump.

Doesn't help the country. you and I

agree on that. Um, so what you have is a

more stable environment with a China

that rightly feels like they have more

leverage over this guy and this

government. So one of the dimensions of

competition here and one that you all

emphasized in that 20 early 2026 paper

on risks is energy.

>> Yeah. Yeah, definitely. And the way you

put it is that America's become the

largest pro state in a way I think a lot

of Americans have not tracked. It's

really a quite remarkable story from

fracking to to to where we've ended up

as a huge exporter of energy.

>> We produce so much more oil than any

country in the world.

>> Yeah, we produce more than Saudi Arabia.

I mean, we used to talk about energy

independence. We got it.

>> Yeah. But we got independence on the old

structure of energy and that China is

becoming the largest electrostate. You

have a tremendous chart. I say

tremendous in the sense that I found it

really shocking to see that China's

exports of green energy technology

are much larger now than our exports of

oil and gas. that they're sort of

exporting the infrastructure of the 21st

century while we're exporting the energy

of the 20th century

>> and theirs is becoming so much cheaper

at scale.

>> So tell me about that competition

because the the energetic foundations of

countries are important. Like Trump has

really doubled down on America's

prostate. Tell me about that

competition.

>> I have no problem with Trump doubling

down on America's a state. Um, I I think

that the United States has the ability

to be um more effective on uh efficient

regulations

on expanding production to have cheap

energy uh for Americans and to export

around the world. The resources are in

the United States. It makes sense. uh

Mark Carney in Canada uh leaves Justin

Trudeau uh in the dust and he's running

the Liberal Party and he's actively

trying to ensure that Canada can be more

effective as an oil producer and

transiting and exporting nation. Smart

for them, right? But what Trump is also

doing is saying, "I don't want the new

energy. I don't actually want wind. I'll

shut it down. I don't want solar, which

is insane. I don't want electric

vehicles, which is crazy. I mean, so,

you know, again, go to Iran for a second

because it's important. One of the

biggest long-term implications of Iran,

the war in Iran, is that OPEC is over.

Uh, the UAE left OPEC in the middle of

the Iran war when they aren't actually

able to produce or export much of

anything, a little bit. Um, why did they

do that? Because they understand that

they're going to have stranded resources

long term.

because there's not going to be as much

of a market for their oil. So, they want

to get as much oil out as humanly

possible as soon as the war is over as

soon as the blockade is done and the

strait is open so that they can then get

on with being a modern technologically

empowered citystate. Um, they're doing

at a small level and we should be very

happy that OPEC is gone because it is a

cartel monopoly over oil. That's not

good for the United States. It's not

good for anyone globally to have a

cartel except the people that control

the cartel. They're doing at a small

level what the Chinese are doing at

scale, which is they want to be

dominating the investments in energy

that will power compute that will power

AI at scale and cheap and they want to

do it for their own country and they

want to export it. Now, Texas

understands this, right? Red state Texas

at least for now. Um, see where Telerico

goes, right? Paxton, whatever. Um point

is they are driving more renewable

energy production than any other state

in the United States. They're also

driving more petrol production than any

other state in the United States. Um

that is the appropriate response for the

world's most powerful country is we

should be able to do both of those

things. But I I want to clarify one

thing here because we're talking here

about the production of energy.

>> Yeah.

>> China's control, the thing they're

exporting

>> is not sunshine,

>> right? the thing they're exporting which

we are way behind on and that's true for

Texas too

>> is solar cells what you use the physical

machinery that turns sunshine into

energy

>> and and so that thing right which the

Biden administration is very concerned

about this was a big part of of their

plans to try to reshore some of the

supply chain

>> but what China has is the infrastructure

of how any country becomes electrostate

you buy that infrastructure from them

and and so what is the power of that not

just of the energy the two states are

producing or the kinds of it but we are

driving in on energy production but

they're driving in on energy

electrostate infrastructure.

>> Yeah. So the in the same way that the

critical minerals gives you that

influence because if you don't have them

you can't allow your economy to grow and

if you don't have the infrastructure

that allows your energy um to be built

at scale and cheaply from China then

your economy won't grow and you can't

have AI if you don't have the ability to

drive energy for compute at scale. So,

China wants to be at the commanding

heights of where the global economy is

going. Now, I mentioned before we are

very short- term in the way we've

thought about these investments. That's

why we the Europeans got into trouble on

gas. That's why we're all in trouble on

semiconductors in Taiwan. You can fix

these things. We're doing it with

critical minerals right now late. But

the Americans are now saying, "Okay,

well, we now we need to start investing.

The Pentagon needs to invest in these

companies. We'll do it in the US. We'll

do it in Chile, in Brazil, uh anywhere

around the world that we can find the

critical minerals we're going to go in.

And by the way, the fact that the the

Chinese have put that loaded gun on the

table, once you do that, you can't do it

twice. So now we've seen, oh, they've

got this leverage, that's dangerous,

will invest. And within 5 to 10 years,

they will no longer have that key choke

hold over the United States in all of

these minerals that we need that we need

for, by the way, for our defense

capability. So the Chinese, if they were

ever to get into a fight with us, the

first thing they would do is shut that

down because it would strangle our

ability to continue to build the

military-industrial complex. You're not

going to fight a war effectively. People

worry about Taiwan. If there were a

fight like that, you'd be very

vulnerable given all of that. The same

thing will happen on energy, but the

longer we wait for it to happen, the

greater the Chinese lead. And right now

we're digging a hole for ourselves by

investing as much as we can in the

energy technologies that are not getting

cheaper at scale and and politically

saying that we oppose the technologies

of the future that will be essential for

growth of our populations and essential

most importantly for AI compute.

>> America's lead in AI.

>> It's not a huge lead but lead of you

know let's call it 6 months something

like that. uh we have the best chips.

The B administration put export controls

down on that. Trump has sort of unwound

those and Trump personally has done that

cuz his administration mostly opposed

it.

>> Well, let me ask you what you think of

that decision because I have found

myself a little bit more conflicted on

this than many people in the the public

discourse. The argument for keeping them

back is that if China doesn't have the

best chips, we will maintain a lead in

AI. The counterargument is that if we

deprive them of the chips, they will

accelerate and be able to accelerate

their chips industry. And we have all

these dependencies on China. And China

being dependent on Nvidia chips would

create a dependency on us, right?

>> And so the idea that you're going to

you're not going to stop their AI

because they have so much energy. They

have like infrastructure we don't have,

right? There's a lot they can do to sort

of supercharge.

But this lead we imagine ourselves of

having a couple months, is that really

so worth uh making Huawei chips

eventually as good as Nvidia?

>> Well, that argument, the second argument

you just made was a reasonable argument

before the Biden administration uh

starts putting all the export controls

on. Once you've done that and you've

shown the Chinese you've got to invest

in your own semiconductors because we

will crush you, then they do it. It's

just like when the Chinese say, "We're

going to force you to have licenses for

rare earths." At that point, the

Americans say, "Okay, that that's

unacceptable. Now, we're going to

invest." So, the idea that holding back

H200 chips from Nvidia is going to make

the Chinese unsee what we have already

done to them, that's a that's a spurious

argument, right? So once you're

involved, once you've declared a cold

war on semiconductors, then you should

be consistent with that policy. Then all

you're doing with the H200s is letting

them catch up when they're spending.

They are moving as fast as humanly

possible in the constraints of their

economy to catch up with the Americans

on semiconductors. It also matters a

little bit less in the sense that if

they have really cheap energy, you can

run the same AI with more

semiconductors. just is more energy to

actually make it work. So it's not like

you get better AI with better

semiconductors. It's just less

efficient. Same AI, same AI. So that

that is the point. Well, I do think it's

both as best as I can tell. So I mean I

know people who were just on this big

trip and talked to a bunch of Chinese AI

firms and every single one of them said

what is binding them is compute. That

they had better compute. It is true that

you can just run more energy through

more lower quality chips and and in some

way like get to to the to the limit,

>> but the people I know who actually do AI

don't think that's quite true. That

having access to the best chips and

those chips getting better does seem to

keep you or help keep you a little bit

ahead. Everyone I know in Silicon Valley

um were surprised by how advanced Deep

Seek was

>> when they released it. So you're right

that the gap between the United States

and China is less great than a lot of

the American AI, you know, sort of

leaders were talking about 3 years ago,

5 years ago. My my core point here is

that Nvidia is pressing an issue that is

of sole interest to Nvidia. It is of no

interest whatsoever to the country. It

is not aligned with US policy towards

China. It is not aligned with a China

that is working as hard as possible to

build that semiconductor capacity and

they will get there. They will get

there.

>> So what has happened since Trump lifted

the export controls? The Chinese are

still are they're trying to promote as

much nativeization of Chinese chips as

humanly possible. They clearly have a

whole bunch of companies that would much

rather have access to the H200s, but

unless it is a big breakthrough for

them. It is not necessarily worth

accepting a quid proquo that would

clearly be necessary to the United

States in saying, "Oh, yes, that's a big

give that you just made to us." So,

right now, the big argument here is

about how fast the Chinese are capable

of catching up when that is their

overwhelming desire. And that's the only

place where they're behind, right? In

terms of like the capability of their

talent, they're producing an awful lot

in terms of um the the the coding uh

that they have. Uh they're world class.

Um and in terms of the energy and the

ability to build and direct, they're

there. And in terms of their political

focus and I think that brings us back to

the question of the Middle East which is

one of the arguments of of Trump and the

people around him is we need to focus on

China. We need to focus on this

competition. Instead what the US

government is focusing on is Iran.

I am myself as somebody who's covered

this and talks to people here confused

about what is happening. Like is it's

like the Schroinger's war at this point.

Is is the war alive? Is the war dead?

How would you describe the state of

America's war with Iran?

>> I actually posted, I think it was last

week, a graphic that I put together that

showed uh Schrodeners's um Iran

agreement like is it a pe is it a

ceasefire? Is it a peace deal? Is it

>> great minds cliche like

>> I know exactly. I mean because he says

different things inside the same post,

right? Um, look, he the reason we don't

know if it's dead or not is because

Trump is desperately looking for an

off-ramp. Uh, but he also wants someone

to blame and he wants the offramp to

look credible and it doesn't. He

understands that right now it looks bad

for him. That the outcome if he accepts

what is on the table today he'll reopen

the straight but Iran will arguably be

in stronger geopolitical position in the

Middle East than they were before the

war. on the table today is the cutteries

would unfreeze Iranian assets that would

be given to Iran in a lump sum in return

for the Iranians ending the tolling of

the strait and the Americans ending the

blockade and then the two sides would

negotiate the nuclear issue. Probably

worth noting here that Trump has

repeatedly and very loudly denounced

Biden and Obama for allowing Iran to

have access to money that was frozen. A

big of cash spoken about many many

times. So in other words, at least at

this stage of the deal, you would

clearly say that the only thing better

about the Trump engagement with Iran

over Obama is that it was Trump that did

it. That's the only thing that Trump

supporters would have to point to. Well,

that's my guy because you're in much

worse position. The straight had been

open before the war. They didn't have

that leverage. They wouldn't have gotten

that money and their nuclear capacity is

still sitting there. So, I mean, are

they still going to have the nuclear

dust as they call it? Well, that is to

be negotiated. Do you trust them? Do you

think in some future period in 60 days

that they're going to engage proactively

with you and the inspectors when the

ships are coming through and they're

exporting and you're exporting and you

need it and you know that it can be shut

down again. It it's a it's it's an

incredible own goal. It is by far the

biggest foreign policy mistake of the

Trump administration. I frankly of any

administration since the Iraq war. I

think you could say that. Why is they

why have they failed so badly? And and

the thing I hear Trump being confused by

when I hear him speak is look, they

pounded Iran with bombs. They killed

many of the senior people. I think he

would have thought by now either the

regime would have toppled. That was

clearly what he wanted at the beginning.

Or it would be so desperate that it

would be suing for peace, willing to

give up things it would never have given

to Barack Obama. Just like China after

April 2nd, he thought they were going to

sue for peace because their economy was

so much weaker than America's. So, what

did he get wrong about Iran? Why have

why is Iran not desperate for an

offramp, but Trump is?

>> Well, one, uh, he he and the Israelis

actually assassinated the leadership.

So, the reason that they had never tried

to close the straight before, which they

clearly had the capacity to do, the the

military capacity, the drones, the rest,

is because they feared that if they did,

that would be the end of their regime.

people would come after their leaders.

The people making the orders would get

killed. Well, then you went ahead and

killed their leaders. So, they broke

glass, they pull lever, right? And that

is what actually happened. So, Trump

thinking that they were going to sue for

peace like Venezuela when in reality

they said, "No, no, no, no, no. You you

you just broke the whole thing. We don't

trust you."

>> Killed the equivalent of the people he

handed power to in Venezuela.

>> Exactly. Exactly. Even if they hadn't, I

would have been very surprised if this

strategy would have worked out. This was

incredible overconfidence

born of the Venezuela success and also

born of Trump's previous history with

Iran where they talk big against the

United States during the 12-day war in

his first term when he killed

Kasamsulammani, ordered the

assassination, then they didn't do

anything. Well, this time you actually

went and blew up their regime. And so,

yeah, they're gonna it's essentially

suicidal response. But anything you can

do to to try um to to regain deterrence

to try because, you know, you can't

trust them for diplomacy. So, there's no

credibility with the Americans saying,

"Okay, we're going to be Mr. Tough Guy

if you don't do X, Y, and Z." I've seen

Trump Trump has posted that in the last

couple months. I'm going to really be

tough guy. No more Mr. Nice Guy. I I

don't once you've assassin civilization

will die tonight.

>> Oh yeah. Once you've assassinated the

leadership, I don't think you can say no

more Mr. Nice Guy. I think that that

analogy should be off the table for you.

So, um he's gotten himself uh in an

enormous jam and the only way he can

resolve it is by undoing all of his war

goals. All of them. All of them. It's

there's no more rescuing the Iranian

people. There's no more ending the

ballistic missile capability. that's for

the region to deal with. There's no more

ending support for proxies. The military

capabilities, the missiles they still

have, the drones they still have,

they've blown up a lot of the navy. Um,

I mean, almost everything they have

tried to accomplish, they have failed.

And meanwhile, the United States has

driven an incredible economic

consequence for the entire world. And he

is to blame. So allies and adversaries

of the United States, they're looking at

oil prices and fertilizer and food.

Describe this for a minute in detail

because I think that people don't quite

realize we have suffered some economic

pain from this war here at home.

>> The fact that it is much worse elsewhere

I think is not fully penetrated. So so

paint that picture a bit.

>> Yeah. Well, I mean so I I mentioned

before I was just in the DR Dominican

Republic, right? And I mean, you know,

this had a huge effect on approval for

the leader. Um, they're oil importers

and the subsidies are much harder to do.

Inflation is way up, right? The United

States as a major oil producer and

exporter is much less affected in the

near term by this conflict. you have um

Asian economies

um who have to ration um and uh the the

energy that's available uh for

industrial uses uh because they can't

get what they need through the straight.

Um you've got the global plastics

industry, prochemicals, what's it come

from? Oil, where's it come through the

straight? Most of that is Asia. That

production is getting squeezed. Those

prices are way up. Those industries are

under severe distress. You've got

countries like the Philippines that are

under a condition of national emergency

right now. You have subsaharan African

countries that may enter financial

crisis because they can't provide. They

don't have the fiscal space to provide

the continued support for their

populations given where prices are

going. And that's before the food crunch

because the fertilizer has missed the

growing season now, but you haven't

passed that through to food until the

growing season leads to vegetables and

fruits and grains that then are

exported. The Americans and the

Europeans and the Japanese, they'll get

the food. It'll just be a higher price.

Countries in the global south, a lot of

those will not even have access to that

food. People will starve on the back of

this.

>> Is there an estimate of how big this

will be? Um I've heard from members of

the United Nations that are involved in

global food distribution that the impact

on the global GDP uh next year uh could

be as much as 1 and a.5%. Again, the

United States will be much lower than

that, but some of these other economies

will be much higher. Um and and look the

the danger every country you talk to,

every leader you talk to sees President

Trump individually as uniquely

responsible for this economic downturn.

And every day that the straight remains

closed is a day that the Americans are

responsible further for that. And and I

I think that the the impact of that on