#53 David McCormick - Fmr CEO Bridgewater Associates - A Battle Plan for America

David McCormick is the former CEO of Bridgewater Associates, a premiere asset management firm and author of Superpower in Peril: A Battle Plan to Renew America. McCormick also served as the Deputy National Security Advisor for International Economic Policy and was a personal representative and negotiator to the G8 under the Bush Administration. McCormick and Shawn discuss the issues at the core of the United States rapid decline in industry, education, innovation, and foreign policy. In his latest book, McCormick describes a plan to renew America. In a world full of uncertainty, McCormick tells a realistic but hopeful message on how we can get on the right path. Shawn Ryan Show Sponsors: LearShawn.com - Information contained within Lear Capital’s website is for general educational purposes and is not investment, tax, or legal advice. Past performance may not be indicative of future results. Consult with your tax attorney or financial professional before making an investment decision. HVMN.com - USE CODE "SHAWN" ZipRecruiter.com/SRS Blackbuffalo.com - USE CODE "SRS" David McCormick Links: Website - https://www.davemccormickpa.com/ Book - https://www.amazon.com/Superpower-Peril-Battle-Renew-America/dp/1546001956 Instagram - https://www.instagram.com/davemccormickpa/ Please leave us a review on Apple & Spotify Podcasts. Vigilance Elite/Shawn Ryan Links: Website | Patreon | TikTok | Instagram Learn more about your ad choices. Visit podcastchoices.com/adchoices

Speaker names marked ? are inferred from speaking time and the show’s known hosts — they are not voice-verified.

• 0:00Speaker 00

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• 0:29Speaker 01

  Mr. President? My company tore me of the explosion on our rig.

• 0:32Speaker 02

  On October 2nd.

• 0:34Speaker 01

  Causing massive water displacement and triggering a tsunami. They all heap the blame on me.

• 0:38Speaker 02

  Tom Cruise is.

• 0:40Speaker 03

  Digger got us into this mess, and Digger's gonna dig us up.

• 0:43Speaker 02

  From the director of Birdman and the Revenant.

• 0:46Speaker 04

  What would happen if I stopped drilling? You stall, you freeze to death, that's what.

• 0:50Speaker 02

  With great power comes great deniability.

• 0:53Speaker 04

  I'm not the first then.

• 0:54Speaker 02

  Digger. See the trailer online. Only in theaters October 2nd. Rated R. Under 17. Not a minute without parent.

• 1:01Shawn Ryan?

  There's a lot of people out there, including myself, that think this country is being destroyed by a small group of people.

• 1:11Shawn Ryan?

  All of our values, everything we stand for,

• 1:16Shawn Ryan?

  everything you've been raised to believe in is currently being destroyed

• 1:22Shawn Ryan?

  by a very small group of people.

• 1:26Shawn Ryan?

  A lot of people just sit back, bury their head in the sand, try to pretend nothing's happening. There's another group of people that just sit back and complain about everything that's happening, but they don't want to do anything about it. My next guest actually has some real solutions on how to get this place back on the right track. I suggest you pay attention.

• 1:51Shawn Ryan?

  Ladies and gentlemen, please welcome David McCormick to the Sean Ryan Show.

• 1:57Shawn Ryan?

  Last episode, we were number nine out of over 8 million podcasts on Spotify. Please head over there, give us a five-star review, share this episode with everyone you know, and let's get this show to the number-one slot. I love you all. Thank you for tuning in. Thank you for being here. A lot of truth coming with this one, and a lot of truth coming with the upcoming ones.

• 2:24Shawn Ryan?

  Love you all. Cheers. One last thing.

• 2:29Shawn Ryan?

  Keep the faith, keep the hope. God bless America.

• 2:39Shawn Ryan?

  Dave McCormick, welcome to the show.

• 2:41Speaker 06

  Thanks, Sean. Thanks for having me.

• 2:43Shawn Ryan?

  It's an honor to have you here. I can't, I cannot wait to dive in on your new book and I really want to get what you're thinking about China. But, brief introduction real quick. West Point grad, Ranger School honor grad, 82nd Airborne XO of Combat Engineering Unit. In the Iraq invasion, 1991, you're on the first wave clearing minefields in Iraq during Desert Storm. At 37 years old, you're the president and CEO of Free Markets, the company sold in 2004 for $500 million. You're on the Bush administration, the personal Bush rep and negotiator to the G8, then to the Treasury Department. You served as Henry

• 3:27Shawn Ryan?

  Paulson's point man on the international response to the 2008 crisis. During the Trump years, you're offered roles, you declined due to your position with Bridgewater Associates. Mattis assigned you to the Defense Policy Board and then Trump removed you, along with 11 others, for ties to foreign policy establishments. You ran for Senate against Dr. Oz. Who endorsed Dr. Oz over you? I'm curious. Why did that happen?

• 4:00Speaker 06

  President Trump did. Why did he? Or how did he? Well, you know, the, I think the thing with Oz was he was this TV personality. So he had 100% name ID. And, and as you know, President Trump valued that a lot because the ability to sort of communicate on television. And Sean Hannity was a very close, personal friend of Oz's. So that helped him get a lot of early attention.

• 4:26Shawn Ryan?

  Interesting. You seem... I really, lot more qualified for that position than Dr. Oz, but then your new book, Superpower in Peril: Battle Plan to Renew America. Let's dive in.

• 4:42Speaker 06

  All right. Well, thanks for having me. Really good to be with you today.

• 4:45Shawn Ryan?

  It's my pleasure.

• 4:46Speaker 06

  You know, the book, actually, I started a couple of years before I decided to run for the Senate. And I had written a couple of articles, and the book was based on this idea that the country was headed in the wrong direction. Economically, we were in decline, debt, inflation, it's only gotten much worse since I started writing the book. National security wise, we're under growing risk. Our military is losing its way, but we have China on the horizon. And spiritually, our institutions are getting corrupted, corroded, this woke progressive ideology sort of hijacking some basic principles of America around merit and capitalism and all these things. So that was the reason I started to write the book.

• 5:31Speaker 06

  And I got about 60, 70% of the way through it, and then I decided to run for the Senate because that seat opened up. So the basis of it is that America is in decline, but decline is not inevitable. Like, it's not inevitable that we're going to lose our place in the world, that we're going to be a superpower in peril. But neither is renewal. It depends on what we do. It depends on leadership. And so this is the what to do book. This is a book that lays out a plan of how we can renew ourselves. And so it's a very ominous cover. You know, our country is at risk of slipping away, but it's also an optimistic book, as you know, because I believe we'll get there. I believe there's a path, but we need leaders to step up. And that's what I'm talking about in this book.

• 6:14Shawn Ryan?

  You know, what I really like about your book is it's not the typical, let me just complain about everything that's going on. There's actually a plan to overcome all of this. And that is very refreshing in today's world. So before we dive in, nobody escapes here without getting a gift.

• 6:33Speaker 06

  All right. Thank you.

• 6:35Shawn Ryan?

  There you go.

• 6:36Speaker 06

  Check it now?

• 6:38Shawn Ryan?

  Check it now. It's my shameless plug to

• 6:41Speaker 06

  I love it.

• 6:43Shawn Ryan?

  To my Vigilance Elite gummy bears. So

• 6:47Speaker 06

  Thank you very much.

• 6:48Shawn Ryan?

  For the travels on the way home.

• 6:49Speaker 06

  My six kids and I will all appreciate this.

• 6:51Shawn Ryan?

  Right.

• 6:55Shawn Ryan?

  So David, I just want to go kind of down the outline of your book, starting with America's decline. You say that we've lost the ability to adapt. I 100% agree with you. Let's, let's start there. How, how are we declining? What are the most pressing issues?

• 7:11Speaker 06

  Yeah, there's, um, you know, I just touched on the beef, you let me go a little bit deeper. So if you look in economic terms, what's always been great about the American economy is it's been dynamic. And, and, and that means that it's with capitalism, like businesses go out of business, people lose jobs, but there's new job creation and productivity has driven our, um, our economy and, and technology, technological leadership has driven our economy over, over, you know, hundreds of years. And we're losing that. We're losing that dynamism in our economy. Let me give you a couple of examples. Well, first, the debt is enormous, $31 trillion. And when you have to pay interest on debt, that squeezes out investment and other good things. Inflation is at a 40-year high. That, that's hard on all of us. It's

• 7:55Speaker 06

  really hard on working families. Uh, across Pennsylvania, it's really hard on people with a fixed income. You know, during the campaign, try, I pull up to a, uh, pull up to a gas station. One day I get out, there's a guy standing next to me filling up his pickup and he can't fill it up because it costs a hundred bucks to fill up his pickup. He needs to go back and forth. I mean, if you're on a month, you know, living month to month, the inflation kills you. But the thing that's the worst about our economy, the thing that should scare you to death, is that the whole premise of America has been essentially, no matter where you start, you work hard, have a little luck, you know, take risk, build opportunity, you can get anywhere. So if you, if you're born in the fourth quartile of, of people economically at the lowest end, you can get to the top. And there's thousands,

• 8:40Speaker 06

  millions of stories of Americans that have done that. Well, that's increasingly less likely today. The likelihood that you're going to start in the bottom and get to the top is the lowest, lowest it's been. And that's why, uh, two things. 80% of Americans think the country's going in the wrong direction. And two thirds of Americans, parents, think their kids are going to be less well off than they are. So that's economically what's happening. And it really chips away at the whole idea of the American dream. From a security perspective, we're losing, we're losing our way. So China is on the rise. China has a technological capability that is far superior to what it was even 10 years ago.

• 9:24Speaker 06

  There was a story in the Wall Street Journal a couple of weeks ago that had this think tank in Australia that studied the 44 technologies that matter most to national security and to the economy. Satellites, artificial intelligence, quantum science, things like that. This article, independent think tank, said China is in the lead in 37 of those 44.

• 9:45Shawn Ryan?

  In 37?

• 9:46Speaker 06

  Disaster, right? Disaster. And there's all sorts of reasons for that that we can get into when we talk about China. But, but our military is, is at risk. And part of what makes it at risk is the wokeness and the progressivism that's sort of driving the agenda. Let me give you a small example. I know you're a Navy guy, but as an Army guy, the fact that the Army came out with its climate strategy under Joe Biden before it came out with his warfighting strategy is all you need to know. And that's part of the lack of focus on warfighting and that lack of ability to look over the horizon on new platforms that are going to be necessary to win. Those are both big problems, national security economically.

• 10:26Shawn Ryan?

  How, how do you think these agendas are filtering into the military? Do you think this is China pushing this one way or another?

• 10:33Speaker 06

  Well, I think it's, it's a little bit of the third thing I'm about to say, which is the spiritual decay. And I think that this is a, this is a war of ideas and there's a progressive ideology that's chipping away at some fundamental premises about America. It starts in our schools. Where our kids are being taught a history of America that is unrecognizable to me. A history of America conceived in evil, the notion, the critical race theory, that that that's the defining narrative of America, when by any measure, America's been the most exceptional country in in history, in terms of bringing people out of poverty, in terms of a of a country that was conceived with the idea of liberty for all, the notion that

• 11:18Speaker 06

  the government is created to support the liberty of the individual, a country that has fought wars to, you know, help others, in the case of of Hitler and and the domination of Europe and the terrible evil that took place there. So, America's been a force for good in the world. That doesn't mean that we haven't had our dark chapters of racism and all those things. Of course, that's true. But in overall history, it's been a it's been a a search for a perfect union, getting better and better. And it's been a great a great history of of accomplishment. That's not the history our kids are being taught. And the reason that's so important is if you don't think America's an exceptional country, then you don't grow up thinking that you have to do everything you can to

• 12:01Speaker 06

  preserve it. And there's lots of reasons for it. I, you know, I blame President Obama in some ways, you know, he was the first one that said, you know, America's exceptional, but I bet the Greeks think they're exceptional and the British think they're exceptional. No, it's not the same. America has been a unique contribution to the world. So that's it starts with that. But that progressive ideology has creeped into business with the hijacking of of profit motive and allocation of capital for ESG measures, really cutting away at the notion of merit and profit motive. We see it in the whole D E and I agenda that's driven how decisions are getting made. We see that in in not only our business

• 12:44Speaker 06

  community, in our schools, but in our military. So it's a pervasive, I don't think the Chinese are behind it necessarily, but places like TikTok magnify it. And and this is one of the reasons I think China has growing confidence and we should be worried is because You're chipping away at the core of what's made America great. And so the book, we'll talk about this, but the book talks about leadership that reforms those institutions and drives in a direction that gets back to American fundamentals.

• 13:16Shawn Ryan?

  You don't think China's behind this push and propaganda towards critical race, the gender dilemma, whatever you want to call it, all these woke programs? And the reason I'm asking is because you see all these politicians that have businesses in China that could be ripped out from under them at any time.

• 13:37Speaker 06

  Yeah.

• 13:38Shawn Ryan?

  Mitch McConnell, the Bidens, you know, on both sides of the aisle. And nobody that has ties to China seems to be fighting any of this stuff.

• 13:50Speaker 06

  Well, I think the best way I'd say it is I think it's in China's interest that this progressive ideology continues to gain traction. And I'm sure China is doing all it can do to magnify it. But I think at its core, you know, it's hard to understand where the progressive ideology comes from, but its core, I think, is a lack of appreciation for the uniqueness of America and a set of beliefs that's undermining some very fundamental things about what's made America so great. And so I look at the current polarization in our country and everything else, and I think the most important thing about it is what ideas are going to prevail that'll take our country forward.

• 14:33Speaker 06

  And we can talk about what some of those ideas are, but that's where I'm so worried about the left, because I think it's taking us down a path where if we continue, in 10 years from now, we're not going to recognize the country that we all grew up in.

• 14:45Shawn Ryan?

  Yeah, I 100% agree. Do you think all the left is into these woke agendas? Or do you think it's a small portion of the left? Because it's sold by the right as it's the entire left. I tend to disagree with that personally.

• 15:01Speaker 06

  I think there's definitely an extreme element of it that's taken it in a very scary direction. If you look in Pennsylvania, for example, which I know best, it's the first time in 76 years that we've had two Democratic senators. And if you look at even the one senator that's there, Bob Casey, the incumbent senator. Even he has sort of jumped on board. He's been viewed as a more of a mainstream, you know, more of a conservative Democrat or moderate Democrat. He's adopted and gone full circle with the policies of Joe Biden and where the left's taken us. And I think that, you know, when you go in business circles and talk to people who are Democrats, where I come from, I'm a business guy, they'll say, man, this has gone way

• 15:46Speaker 06

  too far. But I think the far left is so vicious that if they speak up, they're going to get crucified. So I'm inclined to agree with you that it's the extreme that's pulling it in that direction. But that extreme has had a disproportionate amount of influence on the agenda of the Biden administration, on business leaders, and I think that's part of what we have to push back against.

• 16:08Shawn Ryan?

  How much influence do you think BlackRock has over all of this woke agenda with the ESG stuff? And I just heard a guy, Andy Puzner, talking about how BlackRock, Vanguard, and I can't remember the name of the other company, but they own 80% of all of the publicly traded companies on the S and P 500.

• 16:29Speaker 06

  Well, I think BlackRock, particularly early on, played a role in terms of promoting the idea that they would influence the companies they invested in by saying they wouldn't invest in them unless they had a certain, you know, a certain agenda that was consistent with ESG. And I think that gets to the real core of the problem with ESG investing particularly. So if you think about it's your money, how do you want your money invested? So if you, as an individual, Sean, wants to invest in Ben & Jerry's because Ben & Jerry's has a progressive agenda, or Black Rifle Coffee because Black Rifle Coffee has a conservative agenda, great, it's your money, do what you want.

• 17:14Speaker 06

  But it's when institutions start to dictate how the pensions or the money in the pocket of you or I or others gets invested. And so that's where the problem lies. So the problem I have with this whole ESG investing movement is who decides? If you're a pensioner in Texas? And part of your, and part of the government dictates, or in New York or California, and the pension board dictates that part of your pension is going to be allocated to ESG kinds of investing, and you don't believe in that, that's a real problem. So I'm objecting to the whole notion that, that political ideology of any kind should

• 17:56Speaker 06

  be integrated into how somebody's pension is planned, invested. Because I think the most important thing is that a return for the pensioner for their years of service is maximized, so the fiduciary responsibility to do that. And BlackRock, I think, made a huge mistake, miscalculation, to be pushing companies to adopt to certain standards. It was moralizing, but it also was taking responsibility and control out of the people who actually should be exercising the responsibility, which is the individual investors. And so they're trying to backstop on that because places like Missouri and Texas and others have pushed back and said, no way, we don't want that, and we don't want BlackRock if BlackRock's going to be pushing that agenda.

• 18:40Speaker 06

  But I think it was a major mistake, and I think it's indicative of losing sight of who gets to decide.

• 18:45Shawn Ryan?

  Do you think there's any, do you think there's any competitors to these companies?

• 18:50Speaker 06

  Yeah, growingly. Growingly, you're seeing two things, which I think are very, very encouraging, well, three things. You're seeing a big pushback on who gets to decide. So these pension plans are saying, no, no, no, we're not going to try to implement some sort of ESG agenda on our pensioners. You're seeing a whole new emergence of money managers that are managing money in a very anti-ESG way, so it gives options to investors. And then the other thing you're seeing is a whole range of investors that are saying, we're going to invest explicitly away from China. So if you want to put your money in investing in ways that is explicitly not going to be China and in ways that is potentially against China, and you're seeing an emergence of

• 19:35Speaker 06

  that, which is the way it should be. I think the market should dictate where people get to put their money, because it's their money.

• 19:41Shawn Ryan?

  Yeah. What are your thoughts on the latest deal with China, Saudi Arabia, and Iran?

• 19:48Speaker 06

  I think it's indicative of the risk of China. So what I say in the book, Superpower and Peril, is China has a plan, but we don't have a plan. We don't have a whole-of-nation plan for dealing with China. And there's two real pieces to the plan, which we can talk about in detail. But one piece is, you got to go to the gym. We got to get strong at home. We got to build our muscle by educating our people. We got to build our muscle by ensuring we have technological leadership. We're losing that, as I said before. We got to build our muscle by getting our institutions back on track. So we got to fix it at home. We can't blame the Chinese for the fact that we've got a lot of decay here at home.

• 20:33Speaker 06

  We can blame ourselves. The same thing, we are facing an existential threat from China. China is a techno-authoritarian state that's on the rise. It's on the march, and it's taking leadership around the world. It's trying to impose its way of governance. It's trying to advance its national security interests in the South China Sea and elsewhere. The partnership with Putin is a great example of that. It's trying to exercise its authority as one of the biggest economies in the world, and partnerships that go against US interests, as the one you just described with Saudi Arabia and Iran. And that's a direct byproduct of two things. One, we don't have a plan.

• 21:17Speaker 06

  And two, we have very weak leadership in our White House. And so, one of the things that compelled me to run, I was writing this book, and the Afghanistan debacle, and the weakness we saw from Joe Biden, to me, was sickening. It left me sick to my stomach to see those service members die because of that incompetence, to see the Afghan folks dropping out of the airplanes. I mean, it was just, and American humiliation on the global stage.

• 21:51Speaker 06

  But what's happened since then are one thing after another, which I think has suggested weakness, slowness to react. You saw that with Ukraine and the support of Nord Stream 2, the pipeline, which was an imitation to Putin, that we've got a weak leader here. We saw it in the response to the Chinese spy balloon. So when the world perceives that we've got weak leadership in the White House, that's opportunity for others, and China's filling that gap. And when our allies start to think that maybe they can't count on us, like Saudi Arabia, Saudi Arabia is a stalwart ally.

• 22:36Speaker 06

  I was in the original Gulf War, which was to protect Saudi Arabia, those oil fields. I mean, that alliance has been with us for, you know, 100 years and for the last few decades has been critical. But Saudi Arabia, I think rightly feels like they can't count on the United States. And when you start to lose trust in the strength and reliability of the United States, you look for other partnerships. China's standing right there saying, hey, we can be your new friend.

• 23:05Shawn Ryan?

  How about the world's currency? Are you concerned that because of these deals, that the US dollar is going to come to this, you know, go to this, is it going to get pushed to the sideline?

• 23:17Speaker 06

  Well, you know, the thing about the US dollar, it's a huge advantage, huge advantage to be the reserve currency. We are the reserve currency. So everybody wants, when times are crisis, to go to the dollar. That gives us the ability to fund things. That gives us the ability to draw capital that's unique. And the reason people believe in the dollar is the strength of the US economy. They believe that, all things being equal, that the United States is the safest place in the world. So when you have the kind of economic policy we've had, particularly over the last two years, that starts to shake the confidence of the world in the dollar and the US economy. So there's two pieces to that.

• 24:01Speaker 06

  One is we've had more than a decade of prolonged low interest rates.

• 24:07Speaker 06

  It's persisted under the Biden administration when there was lots of reason to raise interest rates, but they've kept interest rates really low. And that makes money really cheap. And when people have cheap money, they invest in some ways that are risky. The second thing that's happened, that cheap money has been, what's gone along with that is enormous spending under Joe Biden. Discretionary spending is up 40%. We have a $31 trillion debt. That's not sustainable. And so that has been the root cause of inflation. Inflation then has to be met with a raise in interest rates, which is making the economy, putting the economy at risk. Those bad policies, that excessive spending, the reengineering of our economy in pursuit

• 24:52Speaker 06

  of a green agenda through the Infrastructure Act, through the Inflation Reduction Act, which did everything but reduce inflation and added to inflation. Those things are the things that undermine the power of the dollar and the strength of the dollar. And so when I say we've got to go to the gym, we've got to get our house in order. If we have our house in order, it doesn't, on economic terms, it doesn't matter what the Chinese do, we are going to be the economic powerhouse in the world. But the fact that we're not right now and that we're weak is creating an opportunity for the Chinese and others.

• 25:24Shawn Ryan?

  How close are we to getting pushed to the sideline? I mean, if you watch the news, it seems like it could happen at any minute. But, you know, the news is very fear-based on both sides. What is your insight into how close we are to losing?

• 25:43Speaker 01

  Mr. President, my company told me of the explosion on our rig on October 2nd. Causing massive water displacement and triggering a tsunami. They all heap the blame on me. Tom Cruise is.

• 25:54Speaker 03

  Digger got us into this mess. And Digger's gonna dig us up. From the director of Birdman and The Revenant.

• 26:00Speaker 04

  What would happen if I stopped drilling? You're stalled, you're freezing there, that's what.

• 26:04Speaker 02

  With great power comes great deniability.

• 26:08Speaker 04

  I'm not the first daddy.

• 26:09Speaker 02

  Digger. See the trailer online. Only airs October 2nd. Rated R. Under 17. Not a minute without parent.

• 26:15Speaker 06

  Well, as I say in Superpower in Peril, I think we're in a very precarious spot. We are in peril, but we have time. And you know this from your time in the military or your time in bar fights or whatever it is, sometimes the biggest, you know, guy has some weaknesses.

• 26:32Speaker 06

  China has some weaknesses. They have some huge strengths, but they have some real weaknesses. The weaknesses are that, you know, that they have an authoritarian model. And an authoritarian model requires the ability to continue to keep a cap on people. And they have an economy that's state allocation of capital. That state allocation of capital is advantageous in some ways for the technology leadership that I mentioned earlier. So it's given them a benefit in the near term, but it also creates huge risk in the long term because the government can never allocate capital as well as the private sector. And they've got a huge demographic problem. So, you know, they're not growing.

• 27:17Speaker 06

  They have a huge aging population and their birth rates are such that ultimately they're going to have far more older Chinese than up and coming Chinese, which is a key driver of growth and productivity. So, so part of this is, is creating the economic juggernaut in America that can compete into the decades ahead. And they have, they have a system that will struggle. I think President Xi sees that. He's, he's a smart guy. He sees that. He also sees this as a moment of American weakness. And that's why he is moving as aggressively as he is to establish China's leadership in the world and these partnerships.

• 27:58Speaker 06

  So to answer your question, I think there's time if we act now and act decisively. And that's why this 2024 cycle for the president and for control of the majority in the, in the House and Senate is so critical because on the current path, we're going to lose the moment. We're going to lose America's leadership in the world. That's why we are in peril. But if we course correct in the coming couple of years, there's, there's a clear path to taking leadership again.

• 28:29Shawn Ryan?

  So we have a couple of years.

• 28:31Speaker 06

  Yeah, I hope so. Yeah.

• 28:33Shawn Ryan?

  What, what are your thoughts on how we're handling Russia, Ukraine? China's come in, they're trying to negotiate a peace deal. We're fueling the war, basically forcing NATO's hand into, into aiding Ukraine. What, what are your thoughts on that?

• 28:51Speaker 06

  Well, my thoughts are that, that, that we can't lose sight of what's happened here. Putin is the aggressor. This is aggression at the heart of Europe. And this is a US interest. This is a US interest. So I believe we should strongly and decisively support the Ukrainians. I believe that President Biden hasn't done that. It's been very ham handed. That doesn't mean give the Ukrainians everything, but it means support their efforts strongly and fully to push back on aggression and win this war. We don't do that because of human rights and the pursuit of liberty. Those are things that we're in support of. We do that because it's in US interest to do so.

• 29:35Speaker 06

  And those that say that we should not do this, we should, this is, we should not focus here, we should turn our attention to China. Those two are very connected, right? If we, if we show weakness and withdrawal from our support for Ukraine, that will embolden the Chinese. That won't give us an opportunity to focus on change. That'll make our situation with the Chinese more challenging, not less so. Now, with that said, listen, you and you more, far more recently than me, we've had 20 years of war in Afghanistan and Iraq where we lost sight of the end game and I don't think had a decisive, the kind of decisive victory we want. We spent, you know, thousands of lives and treasure.

• 30:17Speaker 06

  And so for those people that say we need to, we need to be careful to make sure US troops aren't drawn into this, I agree. For those who say we have to make sure the money doesn't get corrupted and stolen like it was at Bagram Air Force Base, I agree. So we have to be wise, but we also have to be forceful in our, in our support and our strength for Ukraine.

• 30:39Shawn Ryan?

  What happens if the Chinese, the reason I'm bringing all this up is I think this is all, these are all reasons why America's falling. What happens if the Chinese successfully negotiate this peace deal?

• 30:52Speaker 06

  Yeah, I think that would be disastrous. And I think that's unlikely. But it shows you the level of ambition that the Chinese have for becoming the world's superpower. And it shows you the vacuum that weak leadership creates. So if anyone's wondering about the ambition of China, the caginess of China, just watch what's happening. And think about how craftily they're positioning themselves, whether it's in Ukraine or whether it's with partnership with Iran and Saudi Arabia, in a way that runs counter to U.S. interest. So we'll see what happens.

• 31:33Speaker 06

  But I think ultimately, our leadership on the world stage, our strength at home, will make it very difficult for China to continue to fill these voids. But we leave voids and we show weakness, and this is going to continue.

• 31:45Shawn Ryan?

  What do you think our interest in the Ukraine-Russia conflict is? Exactly what is our interest? Why are we there?

• 31:55Speaker 06

  Well, we're there, I think, because stability in Europe, the biggest market in the world other than Chinese and the United States, Western democracies, which have been our allies for many, many decades, unique economic partnerships and mutual interest, instability in Europe, chaos in Europe, ultimately risked U.S. interest. That's the primary reason. Instability, where, and anyone who thinks that if you said tomorrow, let Putin have Ukraine, anyone who thinks that then that stops the aggression, hasn't read history. Because giving into aggression encourages aggression.

• 32:39Speaker 06

  So that's why it's in our interest. Because stability in Europe, both economic and national security stability in Europe, is critical to U.S. interest. And that's why we should support Ukraine in pushing back on that assault. But we need to support them in the way I described, wisely, decisively, strongly, but not in a ways that becomes a slippery slope.

• 33:02Shawn Ryan?

  If they negotiate the Pus deal, does that automatically throw us in the number two slot?

• 33:10Speaker 06

  Well, I think there's a number of different things on the world stage that, no, I don't think one thing takes us from number one to number two. But there are a number of things that are currently happening economically, national security-wise and elsewhere, that in combination are why we're in peril. So I don't think there's one day that we'll wake up and say, oh, that happened, therefore. But listen, the trend line, in relative terms, what's happening when I talk about decline, in absolute terms, we're slowing down in our capabilities economically, national security and spiritually. But in relative terms, China's rising. And so it's across that front that we have to worry. And that's what the book tries to address.

• 33:52Speaker 06

  It tries to address a comprehensive, whole-of-nation strategy for combating China, because it's not, it's not, there's no, it's not like a hole-in-one, where all of a sudden we're back. It's lots of things that together have to represent a strategy for ensuring we remain strong and the superpower in the world.

• 34:12Shawn Ryan?

  Okay. One more question about this. If they negotiate that peace treaty and the war stops, does that throw us into a recession? Reason I'm asking is because the way I understand it, and I'm glad you're here, because I do not understand economics, but the way I understand it is the only reason we're not in a recession is because we spun up the military-industrial complex. And Lockheed, Boeing, Raytheon, a couple of other of these companies are the only ones that are, that they're the reason we have a positive GDP.

• 34:45Speaker 06

  Yeah, I don't think that's true. I think the amount of spending on Ukraine, while significant, is relatively small compared to, you know, the overall defense budget. I mean, the whole defense budget's 800-plus billion, and we're talking tens of billions of dollars in the case of Ukraine. So. But it's enormous amount of money to Ukraine, but it's not, this is, the economy's not going to go one way or the other because of what's happening in Ukraine. The economy is at risk because of the enormous spending of Joe Biden. So trillions, more than 10 trillion dollars of incremental spending over the next 10 years. So it's, it dwarfs anything that's happened in, in our economy for, you know, forever.

• 35:30Speaker 06

  And it also is creating that, that misbalance between assets and liabilities because the inflation is creating a need to raise interest rates in a way that's going to have lots of ripple effects. So I think the economy is at a lot of risk, but I don't think the, the primary issue is going to be, is going to be Ukraine. It's going to be much more about how we deal with this mismatch that's been created by these terrible policies of Joe Biden.

• 35:55Shawn Ryan?

  Well, that's actually refreshing to hear.

• 35:59Speaker 06

  So I don't know, maybe not. That was not meant to be optimistic.

• 36:04Shawn Ryan?

  Well, I mean, yeah, I've, I've been really worried about the, the peace treaty between that China's negotiating and, and I've been thinking that that would throw us into the number two slot, especially after this stuff with Saudi and Iran. And then, and then the way I understood it, like I just said, I thought that if they would negotiate that, we're going right into a full-blown recession. So let's move into what is the American way of renewal?

• 36:32Speaker 06

  Well, this is, you know, I want to step back here because when you think about, you know, people have asked me about the book, they say, oh, it's such, you know, superpower apparel, like, wow, like that is, that's scary. And then you read the book and the book's kind of optimistic. How do you reconcile that? How do you reconcile that? And I tell the story, which kind of puts in perspective, you're, you're younger than me, so you don't remember this, but I lived through a period just like this, felt a lot the same in the late seventies. So I was 14, 15 in 1979. We had 15% inflation.

• 37:11Speaker 06

  We were in a recession. We had gas lines that went around the block. During the Carter administration, to get gas because there were shortages, there were odd days and even days. And you could only get gas on whether you were an odd day or an even day. And I remember sitting with my dad in the gas lines. We had like one of these stationery, the country squire had wood on the sides, waiting for gas. And there was Desert One in 1979 where Jimmy Carter sent special operations into Iran to try to rescue the hostages. There was a crash on the sands. We lost eight service members. It was humiliation, just like Afghanistan. Eighty percent of Americans thought the country was headed in the wrong direction. 1979.

• 37:56Speaker 06

  1983, I'm at West Point. I'm walking down these, you know, beautiful pathways, mountains all around. It's, you know, you feel like you're at the top of the world. America's back. Inflation's in check. The economy's growing. Deregulation, tax cuts have made a huge difference for the economy. The military was back on track. There was a buildup, which ended the Cold War, six years later in 1989. It was morning in America. Four years later, morning in America. And why was that? Because of the pro-growth, pro-American policies of Ronald Reagan. It made a huge difference. And so the point there is the leadership matters. We've been here before. It's the American tradition.

• 38:39Speaker 06

  We get to the edge of the cliff and we pull ourselves back. And that's what's happening. We're at the edge of the cliff and we need leadership to pull ourselves back. The second story I want to tell you, and then this will show you the path on renewal and innovation, is I was born in Pittsburgh. Grew up in northeastern Pennsylvania, near Scranton. But after the Army, I came back to Pittsburgh. And I lived in Pittsburgh and I joined a small company and eventually ran this technology company we took public. But on weekends, I used to run. And I'd run through Shenley Park. And you get up to the top of Pittsburgh and you see down the Monongahela River.

• 39:19Speaker 06

  And you see all those steel mills that were now the, just carcasses of the bygone days. And then you come up through Oakland and you get to University of Pittsburgh, which is now the Life Sciences Center, one of the Life Sciences Center of the country because of University of Pittsburgh Medical Center. And you keep going, you see Carnegie Mellon. And Carnegie Mellon had all this basic federal funding for R and D, which is critical to innovation. But then it had these entrepreneurs that graduated and then started these companies that drew on great talent from across Pennsylvania and across the country. And that became the basis for the renewal that took place in Pittsburgh. And my company, we took public, was on the skyline. We had a building, Free Markets was the name of the company.

• 40:03Speaker 06

  And we were like the hot startup that was part of the technology renewal in Pennsylvania. The two things that those stories had in common, the renewal of Ronald Reagan and the renewal of Pittsburgh, is that it was focused leadership that was dealing with the challenges of the moment. And the challenges required different solutions. It's not like you can say, hey, let's take Ronald Reagan's playbook. Let's do that in 2024. No, no, no, no. It's you have to have clarity of vision of the America you want. You have to have clear policies that are dedicated to dealing with the root cause problems, and you have to have execution. And so in Superpower and Peril, what I try to lay out here is an innovation agenda, a

• 40:45Speaker 06

  renewal agenda that brings back productivity, that brings back dynamism to our economy, restores the American dream, but also makes us strong so we can combat China at home and abroad. And there's really three pieces to it. It's very simple. It's educate our people. We can talk about what that means in terms of schools and skilled workforce. It's ensure technological leadership. And so there's a whole series of things we need to do to reverse what I described to you with the Chinese being in the lead. And here's the one that probably is talked about too little: data. Data, there was an article in The Economist a couple of years ago that said, "Data is the new oil." Like, it is the strategic asset that's going to determine which countries rise and fall.

• 41:30Speaker 06

  It's not quite like oil, because when you use oil, it's gone. When you use data, you can use it over and over again. And controlling data, using data for innovation, using data for strategic advantage, is one of the core things to maintaining leadership in the world. China has a data strategy. China is looking at the Fitbit data of the soldiers in Afghanistan to see what's going on. China is using the data from TikTok. China's using the data from its own people to drive artificial intelligence and remote vehicles. Data is a strategic asset, and we are not treating it as such. So, the policies I'm laying out are education, talent policies, technology policies, and

• 42:15Speaker 06

  data policies, as a renewal agenda to take America forward. And this addresses a lot of things, and we can talk about them. But the one thing it addresses is, those folks I met on the campaign trail in Pennsylvania that the whole system's left them behind. And they're angry and pissed off. And my big takeaway, and I talk about this in the book, is, they have every right to be. The last 20 years has been great for lots of people, mostly at the top, that already had assets, that the system was working, the elites. It's been pretty bad for a lot of other people who had real incomes, stayed flat, who didn't have opportunity, who sent their kids away to war, who got screwed by fentanyl in their communities, who are dealing with the crime in the inner cities. So, this renewal plan's a plan for all Americans.

• 43:00Shawn Ryan?

  Well, I want to dive into each and every one of those pillars. Real quick, though, I'd like to take a break. I want to take a minute to tell you about Vigilance Elite Patreon. Patron support is what makes this show possible and gives me the ability to bring these one-of-a-kind stories to the public. Go to patreon.com/vigilanceelite and support The Sean Ryan Show today.

• 43:31Shawn Ryan?

  All right, David, we're back from the break. Let's dive into these three pillars. So let's start with talent.

• 43:38Speaker 06

  Yeah, talent, if you think about running a business, and you've experienced this too. I mean, the quality of the people on the team make all the difference between winning and losing, succeeding and failing. And, you know, we've been blessed in America where we've had the greatest workers and the most entrepreneurial people in the world. But we need to continue to do what's required to be able to compete and win on the global stage. And there's a lot of things that are happening that are chipping away at that. It mostly starts with our schools. So our schools, as I mentioned earlier, what we saw during COVID should have been a wake-up call for all of us. So if you look at the data, we're losing the quality of our students in terms of math, science, and engineering against the developed countries in the world, like 18th

• 44:22Speaker 06

  in developed countries in terms of the quality of our students if you take a test worldwide. That was, you know, 30 years ago, that was not the case. We were, you know, one of the greatest education systems in the world, but we're losing steam.

• 44:33Speaker 00

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• 45:03Speaker 01

  Mr. President, my company tore me of the explosion on our rig. On October 2nd. Causing massive water displacement and triggering a tsunami. They all heap the blame on me. Tom Cruise is.

• 45:14Speaker 03

  Digger got us into this mess, and Digger's gonna dig us up. From the director of Birdman and the Revenant.

• 45:20Speaker 04

  What would happen if I stopped drilling? You're stalled, you're freezing, that's what.

• 45:24Speaker 02

  With great power comes great deniability.

• 45:27Speaker 04

  I'm not the first, Danny.

• 45:28Speaker 02

  Digger. See the trailer online. Only in theaters October 2nd. Rated R. Under 17. Not a minute without parent.

• 45:34Speaker 06

  But more than that, what we saw during COVID is the role that teachers are playing. And how far removed parents are from the quality of the education that our kids so covid was a blessing in that sense. People could look over the shoulder and see the history of America that's being taught. They could learn about the fact that, you know, teachers are introducing our kids to sexual concepts and sexualization and playing that role is an intermediary as opposed to parents being the ones that talk to their kids about that and and and help them understand gender and all those things. That shouldn't be teachers. And and the and the school system, the public school system is failing. If you look at the last 20 years, the spending has increased fairly dramatically in in education,

• 46:17Speaker 06

  but 70% of that has gone to administration rather than actual teachers and the quality of teachers. So this is a rallying cry, this moment for dramatic reform of our education system. And and we're seeing that in key states. We're seeing that, that covid really empowered parents. We're seeing it in school board races, where parents are running to replace woke school boards. We're seeing that in states like Florida, in Arkansas, where Sarah Huckabee, a couple of weeks ago, just got passed her education bill, to really begin to to to change this. And at the core, none of this is going to change. It's only going to be incremental until we break the back of the teachers' unions. And the problem

• 47:01Speaker 06

  we have is that that's a that's a monopoly. It's a monopoly, and it's standing in the way of choice. And so we need to introduce the concept of choice, where kids have the money that the public's going to spend on them, and we should support education, like on their backs like a backpack. And the kid and the money goes to the the place that their parents think is going to be best for that that kid. And so this, I hope, will give new momentum to the idea of choice.

• 47:31Shawn Ryan?

  You brought you had an interesting fact in your book that I found alarming. You said that 7.7, there was only been a 7.7% increase in teachers in the past 20 years, but there's been a 75% increase in school administrators.

• 47:50Speaker 06

  That's right.

• 47:51Shawn Ryan?

  How how does that happen? How do you how do you dump 75?

• 47:56Shawn Ryan?

  It doesn't make any sense to me at all.

• 47:58Speaker 06

  It's bloat, it's bureaucracy, it's wokeness. Basically, you lose sight of the mission. The mission is all about the kids. It's like every dollar. I mean, honestly, Sean, go to our military today. Look at the tooth-to-tail ratio. How much money is with the troops and the frontline and the weapons? And how much is on everything else? And you'll see even that ratio is changing. It's a byproduct of bad leadership. It's a byproduct of losing sight of the mission. And I think it's fairly a byproduct of this progressive ideology that's putting all sorts of Christmas tree ornaments on the mission of schools or the military at the expense of the actual mission, which is to educate our kids. So we've got a real problem there.

• 48:42Speaker 06

  And that's a building block for our renewal.

• 48:45Shawn Ryan?

  Did this, but we've had, this happened through the Bush administration, it happened through the Obama administration, it happened through the Trump administration, and now the Biden administration. Were there spikes? Or was this a steady incline?

• 48:59Speaker 06

  It's a steady increase, but I think the progressive, woke rallying cry has only grown. I think that has definitely grown. And I think that's pervasive in our teachers. By the way, my mom and dad are both teachers. So I'm pro-teacher. I say that in the book. I reckon, and the people that changed my life was a teacher and a football coach, who showed me the path to leadership in the world. So I wanted to say, our teachers are critical, but they're locked in a system which they can't possibly perform their job. And they've been hijacked by this teacher union ideology that's taking us in a terrible direction. And so we've got to change that.

• 49:42Speaker 06

  And the only way to change it is like, you know, the things on the margin are like moving the deck chairs on the Titanic. We've got to change it structurally. And I think the concept of choice is the pathway to real structural change. And then there are going to be some great public schools that give great opportunity to kids, but they're going to have to compete for the dollars. And, you know, the important thing for us to say on this is, that broken school system, the people it hurts the most. Or minorities and blue collar kids. It is the biggest, biggest barrier to true opportunity. Because the people that have money can send their kids to any school they want.

• 50:27Speaker 06

  It's the people that are dependent on the public school system and locked in a system that's just not giving them what they need, that are relegated to, you know, not, not an adequate education and not an adequate opportunity. So this is, this is great for the American dream, to fix our schools and give opportunity to everybody. So that's one big piece on talent. The second big piece, there's three pieces that I talk about in the book. The second big piece is skilled workers. You know, when you and I were growing up, the path to a skilled workforce, the path to success, the American dream was go to college. And I grew up on a college campus.

• 51:03Shawn Ryan?

  Can we move back to the schools?

• 51:04Speaker 06

  Yeah, I'm sorry. I jumped too quickly there.

• 51:09Shawn Ryan?

  Right now, we're in Williamson County, Tennessee. These are some of the best ranked schools in the entire country. I just had an 18 month old. Every friend acquaintance that we have that has kids, doesn't matter what age, in this county, is yanking their kids from the public school system, all of them. Everyone's homeschooling. Now you're starting to see these-

• 51:31Speaker 06

  Despite the fact that they're great schools, you're saying?

• 51:33Shawn Ryan?

  Despite the fact that these are the best schools in the country. They're yanking their kids out of the public school system. And what you're seeing are these clusters of, these little communities popping up where it's a group of parents and they, and, and, and they homeschool their kids. And, and one parent does it on Monday, then another one does it on Tuesday. I don't know one person that's sending their kid to the public school system.

• 51:57Speaker 06

  Yeah.

• 51:58Shawn Ryan?

  And I would like to be able to send my son to the public school system, but I feel like because everybody's yanking their kids out of the public schools in this county-

• 52:10Shawn Ryan?

  There's not going to be any funding.

• 52:12Speaker 06

  Yeah.

• 52:12Shawn Ryan?

  So how are we gonna, how are we gonna restore faith in the public school system?

• 52:19Speaker 06

  Well, you know, what's gonna happen is that, that, that, what you're describing has so many bad consequences of it because, you know, you are still paying for the schools because the schools are paid for by taxes. So the people that are doing that are essentially able to afford to do it. And the people that can't do that are the people that are living month to month who can't afford it. So it furthers the gap between those who have opportunity and those who don't and, and the, you know, the, the lack of understanding between the two. And ultimately, I, I don't think you can fundamentally change education without it being pretty disruptive. It's gonna be pretty chaotic because the idea of choice is gonna create just what you said for everybody because it's not just the people can afford

• 53:03Speaker 06

  it, but everybody's got a backpack full of money on the kid and they can go anywhere. And then the public schools have to compete on their capacity to have somebody like you say, no, no, it's, well, I could afford to do anything with the kid. I want to put him there. And, um, and the, the path from this moment to that is gonna be painful. It's gonna be chaotic. But the fact that it's gonna be painful and chaotic shouldn't deter us from doing it because the consequences of staying on the current path are just disastrous.

• 53:35Shawn Ryan?

  What are some of the things you foresee happening that are, that are gonna be chaotic?

• 53:39Speaker 06

  Well, it's, it's already starting to happen where, um, where I think you're gonna see more and more choice. And so the more that people are taking, or have the capacity to have public funds go with the kid, the more pressure that's gonna put on underperforming schools. And the more pressures on the performing schools, they're gonna have to, to shut down, or they're gonna have to alter, they're, they're gonna have to alter themselves dramatically to compete. But the process of going from here to there is gonna be chaotic in the sense that schools are gonna fight, there's gonna be fight over taxes. You know, this is gonna be a very chaotic fight, but a fight that's necessary. It's not, we're not gonna wake up one day and say, oh, we've passed this legislation and we're in good path. No, it's gonna be sort of bottom up.

• 54:21Speaker 06

  School boards, state legislatures, and a fight for who gets to decide. And, you know, 10 times out of 10, I'd put my faith in the capacity of parents to pick the schools that are best for their kids, to influence through school boards, and not the state to decide that they're going to create a school system that's good for everybody. That competition and that parental involvement, I think, is going to take us in the right path. But, and as I said, it's absolute, school reform is great for all of us. It's really great for working-class families and minorities. Right now, they're the ones who suffer the most from such a weak school system.

• 55:02Shawn Ryan?

  So when you talk about a choice, when the parents have a choice, where they send their child to school, are you saying that in order to go to a charter or private school, that would be state or federal or local funding?

• 55:18Speaker 06

  Yeah, I'm saying that the funding that you put into, right now, for every kid in your county, there's a certain amount of money that gets allocated to that kid. And that money right now gets put through the public school system. If you flipped the switch tomorrow and said, "That money's to the kid," and then you could go to a religious school, you could go to a charter school, you could go to the public school, it's up to you, the best way to do that. All of a sudden, the parents have the power. They pay the taxes, but the taxes come back to them in the form of a tuition voucher, where they can go anywhere they want.

• 55:58Speaker 06

  And that competition and that empowerment of parents is going to make a big difference in terms of what schools teach, how they compete, and what the quality is.

• 56:09Shawn Ryan?

  So I have one question.

• 56:12Shawn Ryan?

  How are you going to trust the parents to take the money and put it towards the child's school? How are you going to keep people from just collecting the money and then putting them back into a public school?

• 56:24Speaker 06

  Well, there's no money that actually goes to the parent. The money is in the form of a support, a voucher, an ability to use the resources that would have been dedicated to the public school system in pursuit of education in some certified form. So it can't just be, you know, any option for education. It has to be a way to ensure that the quality of education is adequate for all, but in a way that's very not top-down driven from the government. That's a balancing act. We need to make sure that if public funds are paying for education, that it meets a certain standard of quality and certification and so forth. So we know if a kid graduates from high school, they've got a good education.

• 57:07Speaker 06

  At the same time, we need to have the competition within schools to deliver on the best education possible. That's the dynamic you're trying to create.

• 57:14Shawn Ryan?

  Okay, so it would be similar to like a scholarship?

• 57:17Speaker 06

  Right.

• 57:18Shawn Ryan?

  It's not just a welfare check. Here you go. We trust you to do it.

• 57:21Speaker 06

  Absolutely not.

• 57:22Shawn Ryan?

  Okay.

• 57:23Speaker 06

  Absolutely not.

• 57:24Shawn Ryan?

  Moving on, moving on to the next pillar.

• 57:26Speaker 06

  Yeah, the next, there's two other parts of talent that I just talked about. One is skilled workforce. And if you look at what's happening today in Pennsylvania and around the country, is there's a mismatch between, well, there's a couple of things. One is, there was always the mantra when I was growing up, and I suspect when you were growing up, that the path to the American dream is college. You got to get a four-year degree. And in my hometown, like, most people didn't go for a four-year degree, but that was the mantra. And so you've got a lot of kids going to college when they necessarily shouldn't have to go to college. And maybe that's not the right path for them. And at the same time, there's a huge gap in a highly qualified workforce, technically trained, to meet the opportunities that are in our economy today.

• 58:11Speaker 06

  And semiconductors is a good example. So one of the challenges that we have with semiconductors... And I was just part of a big study that looked at these is that they can't find the workforce in the United States to fill all those great jobs. They're not college education jobs necessarily, but they're technical jobs which would have great middle-class living and opportunity and so forth. And so there's a certain subset of our population that should have the opportunity to opt out of college and to develop great skills so they can have the kind of middle-class, great existence, great jobs that the steelworkers had in the 50s in Pittsburgh, where, hey, you could have a great house, take great vacations, you would have a great middle-class

• 58:52Speaker 06

  existence rather than living month to month or paycheck to paycheck. We don't have, we're not geared to creating that sort of capability today. We have community colleges, we have some technical schools, but it's tiny relative to the demand. And the gap that you see in employers, when I was traveling across Pennsylvania, manufacturing firms, chemical companies, fracking, fracking's huge in Pennsylvania. I talked to the people that run the fracking companies, I went and visited a bunch of rigs, they can't hire enough people in Pennsylvania to meet the needs, so they import them from Oklahoma or Texas. So there's a huge opportunity to reorient our kids, a subset of our kids, to these

• 59:36Speaker 06

  great careers and great jobs. We need community colleges that do that, technical schools that do that, we need to think about the funding of that, veterans benefits that would typically be with the VA, GI Bill for college should be dedicated to also to be able to do that, Pell Grants. There's a whole way that we can both create these opportunities. A good example in Tuncanic in Pennsylvania, industry and Lycoming Community College have come together to create a whole technical program, a two-year degree for four or five key areas in fracking, in the oil and gas industry. And those are key gaps, but that's, I don't know, 60 or 100 kids, I don't remember exactly

• 1:00:19Speaker 06

  what it is, but it's tiny relative to the demand, both in Pennsylvania and nationally. So there needs to be a whole focus on skilled workforce that creates opportunity for people to really build their skills. And this also will help people that are, in some cases, there's been a lot of folks that have been put out of work by globalization. And typical manufacturing jobs and so forth have have have gone abroad. Some of those need to come home. We'll talk about that in a minute. But some of those aren't ever coming back. And we need to help people retool and be able to compete in the new economy. So that's the second piece. I have a third piece, but do you any follow up on that?

• 1:00:55Shawn Ryan?

  I do. I have a question. So you think that a lot of the the the the jobs aren't being filled because there's no skilled workers. A big media narrative is they're not being filled just because government spending is out of control and people become lazy.

• 1:01:13Speaker 06

  Well, some of that's true. I mean, clearly, we paid people under the Biden administration not to work in in the early days of the COVID response. So absolutely, we've got a, you know, we've got a, we've got a cultural drift where, you know, kids don't necessarily have the same determination to work and make. So that's a real thing. I'm not trying to in any way minimize that. We had the the misincentives. Where if you make it easy, we can have a, you know, live a decent life without working. That looks pretty good to a lot of people. So that's a second problem. And then we definitely have a mismatch with the skills that are required and the skills training that's available for those enterprising people that really want to work and and and build a great middle class existence.

• 1:01:55Shawn Ryan?

  How do we motivate the the laziness?

• 1:01:58Speaker 06

  Well, you can disincentivize at a minimum. You know, you and I both learned the hard way. You know, I think I started in the army at, I think my first salary was 19,000 a year. And, you know, you had to, you had to work. And the people that were joining the military at the time, what it was a path. It was a path to opportunity. It was a path to to to, you know, moving forward. So you've got to create that, hey, listen, there's no free lunch. And if you want to be a participant in our society, you, you know, you got to go do it. And I think we've become a little too lax on that. Certainly, COVID perpetuated that, I'm afraid.

• 1:02:35Shawn Ryan?

  How do you think that's going to play out with the vote? I mean, there's a lot. I don't I don't know how many, but it seems to be there is a lot of people that are just.

• 1:02:46Speaker 06

  Totally fine with just living off the system, so. Well, I don't know. I've got, um, I've got, I've got, I'm an optimist, you know, I'm an optimist. I can't, I can't help myself and I see all the problems. But in the end, I believe that Americans, deep down inside, know two things. And we got to reinforce these messages over and over again. But, you know, being a citizen of, of America, being a citizen of the United States is a, is a huge privilege. It's, um, it's part of the greatest country in the world. Even on our worst day, America's better than, you know, our, the poorest among us are richer than 90% of the world. It is a marvelous country.

• 1:03:29Speaker 06

  It's a privilege, liberty, freedom, and so responsibility. Like, it doesn't keep going unless we keep it going, you know? And this is what I try to reinforce with my kids. And this is what I think we need to reinforce with that next generation, which is, this will only be the America that we know and love if we actually all act to do it that way. What's that mean? It means, you know, builders and workers in the economy that make it great. It means people that run for office that are high-quality people that want to serve. It means, you know, a great military that's not struggling with huge recruiting challenges because people don't believe anymore. So, you know, we're at that moment, feels a lot like 1979, where people are questioning America's greatness at home. I understand that, but the way we get through that is we lead.

• 1:04:14Speaker 06

  And so, I don't know if that's two pie in the sky, but that's the way I think about it. I hope you're right. I hope you're right. All right, let's move on. Yeah, third thing on talent is just immigration. And this is, um, this is so polarizing right now. And I, man, I saw this firsthand. So everywhere I went on the campaign trail, everybody say illegal immigration, you know, the open border's killing us. And so I went to the border, I went to Yuma, had Brandon Judd, who is the, you know, president of the Border Patrol Union, take me around along with some local leaders. And the crisis we have on the border is beyond.

• 1:04:57Speaker 06

  Beyond anything I could have imagined, the degree to which it's porous, the degree to which it's controlled by the cartels, the degree to which we have huge human suffering, exploitation of women. I mean, it's just, it's awful. And so the, and the Biden administration has in the last two years, taken a situation that was moving in the right direction, very stable under President Trump and made it orders of magnitude worse. And the reason that affects Pennsylvania, which is not obvious to some people, is that open border results in fentanyl coming across the border and making its way across the country, but into Pennsylvania in a couple of years, a couple of days. And my hometown, where I grew up, is right on Route 80. That fentanyl comes right down

• 1:05:42Speaker 06

  from New York and the Route, on Route 80 and others. We had 5,000 fentanyl deaths in Pennsylvania last year, 100,000 nationally. I mean, this is a crisis. That's not talking about other people that are addicted, rehabilitation. This is a national crisis that's perpetuated in part by the border. There's also the illegals coming into different parts of Pennsylvania, and there's the crime in the city of Philadelphia. But the fentanyl crisis is a particular consequence of this. So you can't start an immigration conversation without starting with that. It's a huge thing. I think the Biden administration has been irresponsible on it, and it needs to be fixed. But there's another side of the immigration story that you actually can't

• 1:06:24Speaker 06

  even talk about these days because it's so controversial. But it's the fact that we've, we're a nation of immigrants, and we need a legal immigration process that works. That works. It's, we can't stop having a legal immigration process. My wife is a legal immigrant. My wife was an Egyptian Christian, and her father served in the Egyptian military and brought his daughters, my wife included, to America so they could practice their religious freedom. And she's had a remarkable American dream. Her father mowed lawns and was a mechanic and then became an entrepreneur and is wildly successful and has been extraordinarily great contributor and citizen to America. That's what's made America great.

• 1:07:07Speaker 06

  So we can't, in our desire to cut off that border, which must happen, lose sight of the need to continue to have an immigration system that makes sense. And what I describe in the book is what President Trump actually recommended but wasn't able to implement in his administration, which is reforming the immigration system so it's more merit-based. So if you look across America today, we've got big gaps. Some of those can be filled by the training that I'm describing, but there's gaps we have that are really standing in the way of economic growth that bringing in legal immigrants don't displace American workers at all. And they're a critical part to our economy continuing to grow and be prosperous.

• 1:07:50Speaker 06

  So the third part of the chapter is, listen, let's talk about this as conservatives, let's talk about this as people, someone who actually witnessed the border and wants to stop. But let's also talk about what we need to do on legal immigration to make the system work. President Trump had these ideas, didn't implement them. The current legal immigration system is, has a lot of problems with it. A reformed immigration system, I think, could address some of those problems.

• 1:08:11Shawn Ryan?

  Why has the Biden administration just completely abandoned the border, especially with the fentanyl? Do you think any of this comes from Chinese influence? The reason I'm asking is because China is supplying the cartels and teaching the cartels how to make the world's most deadliest fentanyl. They've already, they're already implementing the next thing that's going to take over fentanyl. Went from heroin to fentanyl, now this other thing is getting ready to come out. It's already being pushed across the border.

• 1:08:43Speaker 06

  Yeah.

• 1:08:44Shawn Ryan?

  We know Biden has ties to China. Do you think?

• 1:08:48Speaker 06

  Well, I think for sure.

• 1:08:51Speaker 06

  That China sees this as a very insidious way to undermine America. So the fentanyl, as you said, that's manufactured in China, comes through the Mexican cartels, teaching the Chinese, the Mexicans to manufacture fentanyl. All of that I totally agree with. And this is one of the many ways, when I say China has a whole of nation strategy for winning, this is one of the ways that they do so indirectly. And so I'm certainly, I'm sure they're happy to see the way this is developing. Whether, I don't think so in terms of the Biden piece. And I think this is essentially a direct, the border policies of Joe Biden are a direct consequence of what he ran on. He ran against Trump. He said that Trump had done a terrible job with the border, when I don't think that was true.

• 1:09:36Speaker 06

  And then he's been pulled to the left by the progressives that have essentially continued to say, you got to have open border policies. I think that will likely change because it's so obvious what a disaster it is.

• 1:09:47Speaker 06

  How do we combat this? Well, we need, I mean, we had a path. I mean, this wasn't, this isn't hard. I actually think that we should consider, in a very disciplined way, the use of the military to work with the Mexicans to stop the cartels. You know, we did so in Colombia some years ago. I think it's that insidious of a risk. And so that's one piece, but we need to close down the borders. I mean, that's the most obvious thing. And it's not like, it's not obvious some of the things you could do. When you're there at the border, you can literally look across Rio Grande. You can see the cartel guys up in the bushes, sending people across.

• 1:10:25Speaker 01

  Mr. President, my company told me of the explosion on our rig on October 2nd. Causing massive water displacement and triggering a tsunami. They all heap the blame on me. Tom Cruise is.

• 1:10:36Speaker 03

  Digger got us into this mess. And Digger's gonna dig us up. From the director of Birdman and the Revenant.

• 1:10:42Speaker 04

  What would happen if I stopped drilling? You're stalled, you're freezing there, that's what.

• 1:10:46Speaker 02

  With great power comes great deniability.

• 1:10:49Speaker 04

  I'm not the first, Danny.

• 1:10:50Speaker 02

  Digger. See the trailer online, only in theaters October 2nd. Rated R, under 17, not a minute without parent.

• 1:10:55Speaker 06

  Look at the cameras at night, hundreds of people are coming across unchecked. I mean, it is wide open. It's not like it's, there's been efforts to curtail it and they just haven't been successful enough. It is wide open. So there's some basic things we can do to secure the border. Whether that'll be adequate or not, I doubt it. We probably need to do more extensive things. But at the heart of it's the cartels. It's big business and they're not going to stop.

• 1:11:18Shawn Ryan?

  Do you think Mexicans are going to be open to working with the US military to resolve this problem?

• 1:11:23Speaker 06

  I would hope so. I mean, it's, it's the same in Colombia. It's, it's challenging because it's economic and the economic benefits are pervasive throughout, throughout the society. So, but the consequences of not getting it right in terms of having a good relationship with your biggest neighbor. And there's all sorts of other leverage we have that we found through the NAFTA negotiations. So I think there's a path to getting the Mexican government and we working together, but it takes leadership. We haven't had it.

• 1:11:50Shawn Ryan?

  How much do you think the cartels infiltrated the Mexican government?

• 1:11:54Speaker 06

  I don't know. I, substantially is my guess, but I, I'm not an expert on it, but that'd be my guess.

• 1:12:00Shawn Ryan?

  Oh, good. Moving on to.

• 1:12:04Speaker 06

  Technology.

• 1:12:05Shawn Ryan?

  Technology.

• 1:12:06Speaker 06

  Yeah, let me just say two things on technology. Big picture. Man, you gotta be careful here. You gotta be careful here because what you don't want to do is develop a path to technology leadership. The, you sort of try to be like China. We gotta have a strategy that's not China. We've got this markets, free market system that's led us to have the greatest economy in the world, the greatest technology in the world. So we can't become China. We also can't become the left with industrial policy where you say, hey, we're going to spend a bunch of money. We're going to pick companies. And by the way, those companies, they have to have certain climate change strategies and ESG and childcare. And we're going to dictate that. And that's the price you pay for the government money.

• 1:12:51Speaker 06

  And the government's picking winners or losers. Can't do that either. But we do have a problem. And we have to confront the problem. And for those people that say, hey, listen, just let the markets work. Well, we've been letting the markets work. And the markets aren't working because I just described to you 37 out of 44. Under the Trump administration, Bob Lighthizer did that same analysis that I just described to you in 2017 on 20 technologies and said the Chinese were in the lead in 10. That was five years ago. So we got to do something, six years ago. So we've got to do something. And here's the two things I think we should do. One is, we got to increase our basic R and D.

• 1:13:34Speaker 06

  So, basic R and D is something that the private sector doesn't invest in because it's long, you know, they're investing for decades. They don't invest in it at the level that we need to. And the benefits of that have always been critical for the space program, for satellites, for the internet. All these things are a byproduct of basic R and D. Our basic research and development today is about half of what it was in 1950 as a percent of GDP. So we got to invest more money in basic science. Second thing we have to do, in my opinion, is, and it's unique to this moment, we have to nudge the private sector to invest in those areas that are critical to national

• 1:14:17Speaker 06

  security, critical to our economic success. AI, 5G, those sorts of things. Right now, the capital that's going there is not been adequate. It's huge expenditures, huge. We're fighting against subsidies that are coming from other parts of the world, and the Chinese in particular, and we're losing. And so what I propose in the book is a way to ensure that private sector capital is moving towards the sectors that matter most, not the companies. I don't want the government picking companies. And I essentially argue for three things. And I learned a lot of this through what I saw happening with fracking and the regulation that I saw in Pennsylvania and elsewhere. But we have to look at those sectors very carefully in terms of regulation and make

• 1:15:01Speaker 06

  those more accessible to private capital and reduce the regulations in places where we think it's making it hard to invest. Fracking is a good example, not national security wise, but a good example. But for those technologies, 5G and so forth. Second, we have to create tax incentives to invest in those areas that are going to be most beneficial for the country. And then I recommend something called an innovation fund. The concept of an innovation fund is essentially this. If you want a lot of private capital to come to a particular sector, have the private capital invest side by side with the government. So if you want money in satellites, you have the government invest side by side in a fund.

• 1:15:44Speaker 06

  And that fund, the government would take first loss and the government would cap its return at like 15%. And so if you're a private investor, you're saying, well, I look at satellite and it's so overwhelmingly, or I look at artificial intelligence, it's so overwhelming. But that government side by side partnership makes the likely return a little higher and minimizes the risk. So I'm going to put my private capital into that fund and my private capital investing in companies in that area. And that concept, which isn't what China does, and it's not what the left is describing, but it's also not laissez faire. It's also not hands off. That's the kind of thinking I think we'll need to make sure we win this technology battle.

• 1:16:28Speaker 06

  And in the book, I talk about, hey, what would Milton Friedman say? Because Milton Friedman is like the free markets icon that all conservatives point to. And I said, listen, I'm not sure what Milton Friedman would say. He probably would have questions. But my question to Milton Friedman, hey, we're losing. We're losing, man. So what's your solution? This is a way that I think we can rely on that which makes America economy the best, which is the risk, the reward, the free capital, the allocation, the market forces, but also nudge it in a way that's going to keep America safe.

• 1:17:03Speaker 06

  I believe you said there was forty one sectors of technology. Well, in that report I was describing, this is just a one report, but it was the Australian, Australian think tank, they identified forty four and said China was in the lead in thirty seven. What would be the top five you think we need to invest in? Well, certainly semiconductors is a huge area because semiconductors are what drives a lot of the economy and we're completely dependent on suppliers outside the United States for semiconductors. That's a disastrous situation. The Trump administration tried to start turning the, turning the wheel on that. The, I'm sorry, the Trump administration, the Biden administration passed the CHIPS

• 1:17:48Speaker 06

  Act. The CHIPS Act didn't have enough money, but more than that, the CHIPS Act now has started to bring all this social policy on top of it, which is exactly what, you know, the big fear is. But semiconductors is one for sure. Artificial intelligence is one for sure. You're seeing the power of artificial intelligence and chatbot, the power and the risk, the threat. I mean, it's scary. Certainly quantum science, which allows for all sorts of developments in other areas. I think probably life sciences, there's huge genetic steps being taken that have huge implications for national security for the economy. Maybe satellites, I don't know, but there's, you know, five or six big ones that have

• 1:18:33Speaker 06

  huge opportunity. Do you have any insight on how far behind we are in the AI race? I really don't. I really don't. I mean, first of all, it's, you know, the, it's, it's very hard to decipher and then you see a breakthrough like chatbot. And that gives you two, for me, it gives me two reactions at the same time. Wow. Like mesmerizing, like what the power of that thing could be and whoa, scary. What that might do at home, but also in the hands of somebody else. And I was speaking, I don't know, a couple of weeks ago with the CEO of Microsoft. I saw him at something and we're, we're friends. And I said, tell me about this, like, what do you think? And he said, it's the most significant development in technology since the personal computer.

• 1:19:19Shawn Ryan?

  Oh, wow.

• 1:19:20Speaker 06

  This is, he said, this is huge and it's going to have enormous consequences, some of which we don't even begin to know yet. So that's-

• 1:19:28Shawn Ryan?

  Good consequences or bad consequences?

• 1:19:30Speaker 06

  Could be both. Yeah, could be both.

• 1:19:32Shawn Ryan?

  Do you have any, can you give us some insight on any of those consequences?

• 1:19:36Speaker 06

  Well, one of the things that it certainly is doing is it's just like the personal computer was in the internet was, it could be highly disruptive to businesses. Because if you think about, I know businesses that require people to write things or people that require people to, you know, process data or things like that. You know, this has an ability to replace all that in a nanosecond. So I imagine as it becomes more mainstream, it could result in very significant disruption in some industries, elimination of jobs. Now, it may create other opportunities and jobs on the other side. It's a little too early to tell, but at a minimum, this is creating a huge pressure

• 1:20:19Speaker 06

  on business, on business models that are hugely, or opportunity, depending how you look at it, on business models that are highly dependent on human processing.

• 1:20:29Shawn Ryan?

  They could recreate this entire interview and have you saying something completely different.

• 1:20:34Speaker 06

  Yes, that's the scary. So your capacity to take all the, the, the information and present something that would be credible as the words or ideas of others, when in fact they weren't, is, is very plausible. I mean, there's two scary things about it. One scary thing is they could do that and present an interview that's not far from this. That's one scary thing. Another scary thing is they might present an interview that, that seems very credible that's completely different than this. And that is, there lies the problem. Because one of the things that I found on the campaign trail, I'm sure you find it with

• 1:21:17Speaker 06

  your, with your listeners and your interviewers, interviewees, people have lost trust.

• 1:21:24Speaker 06

  They've lost trust in their leaders. They've lost trust in the church. They've lost trust in the military. They've lost trust in business leaders. They've lost trust in government. You know, the trust levels are, you know, 15, 20%.

• 1:21:38Shawn Ryan?

  Schools.

• 1:21:38Speaker 06

  Schools. They've lost trust in schools. They've lost trust in the media. They've lost trust in the accuracy of the information they receive. And this, if used poorly, could just reinforce that. I mean, who speak, who am I really talking to? What is really being said? Is it actually? And so you start to think about like an existential question. How does a society run if nobody trusts anything? Right? That's, that's, so that's the worry I have. And, and finding leaders that can give people faith are forthright, can lead through this, deal with these complexities. It's not easy. It's not easy.

• 1:22:18Shawn Ryan?

  It's, this AI stuff scares the hell out of me. I mean, for anybody that's not putting this together, they could have, they could replicate the president of the United States and have him saying something completely different that looks 100% real.

• 1:22:31Speaker 06

  Yeah.

• 1:22:31Shawn Ryan?

  And, um, yeah.

• 1:22:33Speaker 06

  Yeah. And that's, by the way, well, we'll get to that in my third part of the book. We talk about, but, you know, part of that is the, the inaccuracies and the lack of trust in social media in particular. And that's, that's a big thrust, but, but the, the absence of privacy on our information, combined with the pervasiveness of, of a social media narrative that's often completely inaccurate and misleading, that's feeding the mistrust.

• 1:23:00Shawn Ryan?

  Yeah. Yeah. Do we have anything else to cover on technology?

• 1:23:05Speaker 06

  I think we hit it, man.

• 1:23:06Shawn Ryan?

  All right. Let's move on to data.

• 1:23:08Speaker 06

  Yeah. So data, listen, I'm, I'm trying to get my head around these concepts in a way that I really understand them, but can also explain them. And I'm, I don't want to present myself as an expert, but as I said earlier in the interview, An innovation is a byproduct of data. National security is a byproduct of data. Data is a superpower. Data is one of the defining things for who wins and loses the next decades of leadership in the world. And China has a plan for data. China is very purposeful about data. And because China is an authoritarian country, it has much more control of data. And my big point in this chapter is we don't have a data plan. We don't have a strategy for dealing with data.

• 1:23:52Speaker 06

  What kind of data are we talking about here? All data. I mean, if you think about, as an example, one of the reasons that the United States responded as incredibly quickly as it did to deal with COVID, you got to give, I think, President Trump appropriate credit for that warp speed, was because the pharmaceutical companies shared data. That data was the core for innovation and breakthrough. So data is a critical driver of innovation in remote vehicles, in artificial intelligence. And I mean, data is the underlying asset in AI. You're processing enormous amounts of data in pursuit of the kind of outputs that come out of chatbots.

• 1:24:37Speaker 06

  So data is really critical. And we don't have a data, holistic data strategy for the country. And I talk about three things in the book, that this isn't comprehensive, but it's three things that I think are quite valuable. The first is privacy. We don't have a privacy regime for our data. And if it doesn't scare you, it scares me that when I order a pair of sneakers on the internet for the next three months, every time I get a social media or email or whatever, I get some new advertisement for sneakers. So. I mean, God only knows where my data is going, who's processing it, how it's being

• 1:25:18Speaker 06

  used. We've lost complete control of our data. And I mean, there's the thing at the end, you sign and click, who knows who gets what. You know, you, we are all vulnerable to our data floating out there in incredible ways. So we have no model for protecting privacy appropriately. And it's very decentralized and inadequate. And it puts us all at risk. And credit card theft and all these things are going up dramatically, identity theft, all this stuff, because we don't have privacy on data. And at the same time, our individual data is growing exponentially. The amount of data around you is hundreds, maybe thousands of times what it was a year ago. Because look how much more you're engaging in ways

• 1:26:02Speaker 06

  that your digital footprint is growing. That's one thing. Second thing is we've got this pervasive social media environment. You know, I've been going through, just it's interesting to me. I'm old school. I like newspapers, you know. So when I get on an airplane, I like to pick up a newspaper and read it on the airplane. I'm a dinosaur this way. They don't sell, they don't sell newspapers anymore. Yeah. You can't buy newspapers. Everything is online, and most people get their news from non-traditional news sources. They get their information from social media. And the big tech firms are the purveyors of this social media landscape, which is the opposite

• 1:26:47Speaker 06

  of a marketplace of ideas. It's not, hey, you pick, you know, you decide. It's an entire narrative that's, for the most part, very left-leaning and progressive, which is shaping our understanding, or most Americans' understanding of the world, what's going on, the issues. And you just have to pick a couple of examples to see that. And the Wuhan lab is the, is the most obvious one, where it seems just common sense that if a virus was started in Wuhan, and which everybody acknowledged, and there's a lab in Wuhan that does all sorts of experimentation around such viruses, that there's probably a connection between those two things. Not 100% sure. It doesn't mean the Chinese even tried to do it. This

• 1:27:28Speaker 06

  is, I'm not even arguing for the intent. It just seems like that connection is highly likely and obvious. And yet, for years, We've been sold a narrative that anyone who says that's being a conspiracy theorist and all this stuff, and now we just find out very recently, no, no, there's been a lot of serious people in the intelligence community and elsewhere that have been thinking that for a long time. That's a perfect example of why people have lost trust in what information they receive. And so we need to do something about that. We need to create some sort of obligation, some sort of accountability for social media to play a role as a marketplace of ideas where it's actually not a one-sided narrative.

• 1:28:10Speaker 06

  But one way to do that is to create liability associated with what social media companies produce. Right now, they can basically produce anything, they're not liable. And so there's a whole set of things that we need to think about to rein in big tech because they're playing a role with social media that I think is very counter to America's interests. There's also, just as an aside, something that really pisses me off, but it's an example of, I think, the problem, is that, you know, when we won the Cold War, the 50s, 60s, 70s, 80s, one of the things that made America successful was our big industry, particularly our technology firms, cooperated with the US government and the Pentagon because we were in pursuit of something together, which was America's security.

• 1:28:55Speaker 06

  That doesn't happen anymore. Project Maven, Google wouldn't have, their workers, their developers, wouldn't work with the Pentagon. You know, none of the big tech firms worked with the Pentagon with the exception of Microsoft to some degree. That's a huge problem. And so with an opportunity to be a US company and benefit all the ways it comes with that window of security and well-being that's being an American company, no, no, you gotta, you gotta do your part. So that's the second piece that I argue. I'll say the third piece and then whatever thoughts you have. The third piece is, you know, we're not in this alone. We've got great allies that we share everything with. Intelligence, defense, spending, you know, the five I countries, which where we have

• 1:29:39Speaker 06

  the the most trusted circle of intel. We get their intel, they get ours. We should have a data strategy that's that's consistent with them because the more data you have, the more of a benefit it is. So countries like Australia, countries like the UK, where we've got these deep integrated partnerships, we should think about how to have data regime that goes head to head with China and puts us in a really strong position. And this is one of the areas that the next generation, hopefully 2024 and beyond, is going to have to have a get dedicated strategy. We don't have that now.

• 1:30:12Shawn Ryan?

  Interesting. I don't have any, I don't have any questions.

• 1:30:16Speaker 06

  Okay.

• 1:30:17Shawn Ryan?

  Technology. So let's take a break and when we come back, we'll hit the next chapter. Thank you for listening to the Sean Ryan Show. If you haven't already, please take a minute, head over to iTunes and leave the Sean Ryan Show a review. We read every review that comes through and we really appreciate the support. Thank you. Let's get back to the show. All right, David, here we go. The final segment.

• 1:30:48Speaker 06

  All right, homestretch.

• 1:30:49Shawn Ryan?

  So, leading renewal, let's talk about confronting China and securing America.

• 1:30:56Speaker 06

  Yeah, you know, the the thing about changing the direction of the country is you got to win elections and you got to have ideas and those two are related. You got to have leaders that can that can win primaries, win general elections, and then have ideas for taking the country forward and then they got to execute them. And so when I was thinking about writing Superpower in Peru, I didn't want it to just be an ideas book. I wanted it to be a leadership book too, because, you know, that's what it's all about. It's all about leaders. When I was telling that Ronald Reagan story, it's about the leaders. And so I identified a couple of areas where I thought leadership was really, really important. And the first one was China. And, you know, I taught, when we talk about China, there's two things we need to do. We needed to go to the gym at home.

• 1:31:39Speaker 06

  So you and I just spent an hour talking about the gym, you know, data and technology and and education. But you also need to confront China and have a strategy for how we deal with China. And so, and we need leaders who know how to do that. And so I talk about my background in China. You know, I I went to China after I left the military for the first time in 1992. And I had read this book, which was called Riding the Iron Rooster Through China, which is this guy Paul Thoreau. So I went into China, was there for about probably six weeks, just by myself with a backpack. And this train was this dilapidated train that drove through the countryside. China was rural. And I went to Beijing and there was, you know, a handful of skyscrapers.

• 1:32:24Speaker 06

  I went running in the gardens in Shanghai. There was no Caucasian people. Everybody was doing tai chi and that, who is this crazy guy? There was two currencies, a local one and one for tourists. I mean, it was just a country from the almost left, left behind. And then I went back 15 years later, 16 years later, as a government official, and it was just full of skyscrapers, a 10-year, 10-lane highway to the downtown of Beijing. And China was going through this incredible transformation, which sadly went off course and became increasingly a threat to American interest. And I saw that early on in the government. I was in the Commerce Department in 2005, and I was in charge of technology exports.

• 1:33:09Speaker 06

  And there was all sorts of pressure from the Chinese to export certain technologies. They came and talked to President Bush about the job I was doing because I was, they said I was being too restrictive. I wrote a bunch of speeches and op-eds. But what's happened since then is even far worse than anybody would have imagined because China has stolen all the technology, built its own indigenous capability. It's not been reciprocal on trade. So the deal was initially, the initial vision was, hey, you know, we'll give access to US markets, you give access to China's markets. That never happened. And China took increasingly the interests of China, US diverged. And then President Xi came in and went like that.

• 1:33:50Speaker 06

  Because President Xi had a view of the world which was very counter to the United States. China's rightful place was on top, displacing America as the superpower. And all that bad behavior that I'm describing got much, much worse under President Xi. And President Xi really created the techno authoritarian model that we've described. And unfortunately, what's happened over the last decade or so is our policymakers have been sleepwalking, sleepwalking through this. They missed it. Republicans and Democrats alike missed it. They missed the growing risk of China. And then President Trump showed up. And to his credit, and I give him credit in the book and I gave him credit on the campaign trail,

• 1:34:32Speaker 06

  he called out China for what it was, which is a true adversary, and began to put in place a set of policies to deal with that, ensuring more reciprocal trade and so forth. And what I'm arguing for is a much more comprehensive strategy, a whole of nation strategy to address China. And China has a plan, and we don't have a plan. And so that strategy has four parts. The first part is to decouple from China strategically. And you talked about, you mentioned this earlier, I mentioned it earlier.

• 1:35:11Speaker 06

  But during COVID, we discovered that we were dependent on China for our supply chains for pharmaceuticals. Shocking. I didn't know that. I honestly didn't know that. I didn't know that 90% of the semiconductors are manufactured 90 miles from mainland China. We have put ourselves in a position of huge vulnerability. So we need to very consciously bring those industries home that are critical to America's security, critical to our future. And that's what I mean by strategic decoupling. Let's identify those key sectors, satellites or AI, whatever it is. And let's make sure we've got the capability here at home. We can't be dependent on China. That's the first thing. Second thing is we got to hold China accountable. We call it called balls and strikes on the bad behavior. The human rights abuses in China. We're not going to go into China and fix their system for human rights.

• 1:35:56Speaker 06

  I'm not saying that, but we need to call it out for what it is. I mean, President Biden did a lot to call out what was going on in Saudi Arabia. There's millions of Uighurs killed out in China and there's no voice. But we also have to hold them accountable for COVID. The fact that the COVID virus became such a burden on the world, the United States, the millions of lives lost, the trillions of dollars with zero cooperation or transparency from China. And again, I'm not saying it was intentional to start COVID. I don't know, but we don't know because they haven't actually dealt with it in a transparent way. So that's the second thing. How would we hold them accountable? Well, it could be sanctions. It could be a whole, if nothing else, you start by every time you talk about China, you start with that.

• 1:36:39Speaker 06

  Like literally just saying, hey, to the world, are you kidding me? Like, why are you letting this bad behavior persist? That's been nowhere. President Biden has said nothing on that. And then there's all sorts of economic tools that we could use to say, hey, we're not going to do this unless you do that. But, but because we haven't even called it out as bad behavior, it's very difficult to, to, to get that momentum now, but that's what we need to do. The third thing is involving investment. So you made that, you made the point that I ran an investment firm. My view on China hasn't, has only gotten more incrementally worried as the situations evolve, but I just want to put it in context. So I ran an investment firm that's one of the biggest in the world.

• 1:37:24Speaker 06

  We had 2% of our business in China, investing in broader markets. And if you go to most Americans today, 30% of the items in their homes are manufactured in China. So our economies are very integrated. So when people say we need to stop all economic activity with China today.

• 1:37:46Speaker 06

  I'm not sure they totally understand what they're saying because not only do we have that, you know, huge amount of trade, but then the trade goes through other countries. So we sell things to, you know, the Netherlands that they then finish manufacturing and send it to China. So our economies are very integrated. What we need to do on that strategic decoupling is make sure, first and foremost, we're not dependent on China for anything that matters. And then the second thing we need to do in investment is we need to make, we need to create a process for ensuring nobody is investing in China, no company is investing in China in a way that supports the Chinese military or the Communist Party. And today, we have investors in the Silicon Valley that are investing in artificial intelligence companies

• 1:38:31Speaker 06

  in China that are working with PLA. So that is completely unacceptable. So when we talk about investment in China and investment from China, the most important thing I would start with, and it's not happening today. So all the, you know, all this, for all the talk and the rhetoric, these things aren't happening, is I would strategically decouple in the way I described, and I would put an investment review process in place. And the thing you would at least do then is you would stop being dependent on China for things that matter, and you would stop helping China in things that matter. And that would be a huge step forward. And then we can begin to think about how we untangle our economies further as we move forward. And I felt this on the campaign trail, because I'd go into

• 1:39:11Speaker 06

  some manufacturers and they'd go, you know, China killed me, you know, like the outsourcing and all that stuff killed me to China. And then I'd go in the next one and there'd be like a Harley-Davidson supplier and they'd say, hey, man, China's our biggest market. We're, we're, you know, sending Harley-Davidsons to China. So as someone who's been an economic guy, who's, you know, run a couple of companies and been in the military, my basic view is let's start with, we can't do anything with China that's going to sacrifice our security. And then once we get that done, let's start about, talk about what the next phase is. All the time holding China to a very high standard.

• 1:39:45Shawn Ryan?

  What do you think the repercussions are going to be from China if this comes to fruition? I mean,

• 1:39:53Shawn Ryan?

  They're involved in so many different aspects. The thing that really bothers me the most, I think, is our energy. You know, there's this huge green energy initiative. Who's going to manufacture all of that?

• 1:40:04Speaker 06

  Yeah.

• 1:40:04Shawn Ryan?

  China. Who's got all the lithium mines?

• 1:40:07Speaker 06

  Right.

• 1:40:07Shawn Ryan?

  China.

• 1:40:08Speaker 06

  Well, this is, uh, this is the great, I mean, the great irony of, the great irony of the Biden administration, right? So, energy policy has done two things, I think. It's made us less secure, less environmental, and more dependent on China. Let me describe what I mean by that. So, um, I, um, Pennsylvania is a huge fracking state. You know, got, got great natural resources there. If, if, if Pennsylvania were a country, it'd be like the fourth biggest natural gas reserves in the world.

• 1:40:41Shawn Ryan?

  Okay.

• 1:40:41Speaker 06

  So it's huge. And, um, and so when President Biden came into office, he stopped the Keystone Pipeline, he doubled down on a, a number of regulations, and that was particularly challenging for fracking. And yet fracking, um, is very, very clean from an environmental perspective. Um, it's very, very safe from an environmental perspective. So almost overnight, what happened is we became less secure because we went from being an energy exporter to an energy importer. So we were dependent on others. Um, it was damaging economically because all those jobs in places like Pennsylvania and Texas and elsewhere, um, were, were pushed back because the, uh, the purchases, um, you know, the restrictions on, on drilling and so forth.

• 1:41:26Speaker 06

  And that, that does just hurt the energy industry. It hurts all the derivative industries that come with it. And, um, so we're less, we're less economically viable, we're less secure, and it's, it's worse for the environment. Because what happens when we're not, we're not bringing out natural gas and exporting it, uh, we're importing much dirtier sources of fossil fuel from Nigeria or Saudi Arabia or elsewhere. So in one fell swoop, Biden made us less secure, he made us, um, less economically viable, and he made us less environmentally sound. And I'm someone who, like, I'm an environmentalist in the sense that I've got a ranch that I, you know, protect the things, like, I am very focused on protecting. The environment, but I'm protecting in a way that's great for Americans, that's

• 1:42:09Speaker 06

  great for our industry, that's great for our national security. So that's the first thing. The second thing is all this spending in the infrastructure bill, in the Inflation Reduction Act, and even in the CHIPS Act to some degree, but mostly those first two, is pushing the green technology on and imposing it really on our economy as part of this transition. And finally, as you say, most of what's required to make that green revolution happen is highly dependent on China. So we're making our economy more dependent on China rather than building the indigenous capability at home.

• 1:42:45Shawn Ryan?

  So do we go back to fossil fuels, or do you think we need to start looking at nuclear energy?

• 1:42:50Speaker 06

  I definitely think we should start looking at nuclear energy. You know, Westinghouse is in Pennsylvania, and absolutely there's a next generation nuclear capability that has huge possibilities. The fossil fuel energy capabilities we have with natural gas is far cleaner than it's ever been in history, and there's carbon sequestration, lots of other things. So there's lots of ways that we can continue to take advantage of fossil fuels in a much more carbon-friendly, cleaner way. Build out nuclear is a real possibility. And listen, I'm not opposed to alternative fuels, I'm not opposed to the alternative industry. I'm opposed to being more dependent on China, and I'm opposed to a subsidy process that

• 1:43:35Speaker 06

  totally undermines the market. And that's what's happening in this push for clean energy.

• 1:43:42Shawn Ryan?

  One question on your business dealings with China, even if they only were 2%. What I'd like to know is what was the turning point where you realized, was it COVID, was it the pharmaceutical industry?

• 1:43:56Speaker 06

  The big difference I had, and I talk about this in the book, my I wanted to sort of make a real point, and this became a very public thing. My difference with the founder of my firm, who is a big China supporter, is just not recognizing the threat from China. And so my view is that China has become an existential threat. It needs to be treated like an adversary, and that we need to have our economic policy and our national security policy reflect that reality. And so I recognize that if you went to the top 100 companies in the world, or companies based in the United States, US companies, many of them are highly dependent on selling products into China at the moment.

• 1:44:41Speaker 06

  That is important for American workers and all that stuff. So if we untangle from China's economy, it's going to have to be very careful how we do that, as it affects American workers. But once you identify China as an adversary, then you start to do the kinds of things that I'm saying to mitigate your risk. And that's the point I try to make in the book, and that's how I reconcile all of it, which is to say, what's become more and more clear over time is China's an adversary. And that was maybe more obvious sooner than people saw it, but it's certainly obvious after President Xi, and yet our country's not responding in a comprehensive way.

• 1:45:16Shawn Ryan?

  I know your time's limited, and we're pushing the envelope here. My last question for you is, are you going to run for office?

• 1:45:25Speaker 06

  I'm thinking hard about it. So I had basically decided I was probably never going to run for office when I became the CEO of Bridgewater. And I had always been deeply involved in Pennsylvania. Pennsylvania, I'm 57, I spent 35 of my years in Pennsylvania. I've got a farm there, I've got my friends there, my mom and dad are there. So I'm deeply committed to Pennsylvania. But when the seat opened up... And people approached me to run for it and I, you know, it's probably not the right time for me. But then Afghanistan, as I said, just grabbed me. And the direction of the country grabbed me and said, man, if, you know, people who have been blessed by all

• 1:46:08Speaker 06

  that America has, don't, don't run, who's going to run? You don't want the people running who have no other alternatives, right? You want people to run who, you know, have had great experience and the benefit of everything America has to offer. And I feel like a lucky guy. So that's why I ran the first time. And I put everything I had into it, you know, we ran a great race. Whenever you lose by 900 votes, there was 1.4 million votes cast, we lost by 900.

• 1:46:32Shawn Ryan?

  Man.

• 1:46:33Speaker 06

  Whenever you lose an election that close, it's not like the next day you say, oh, the motivation for running went away. It hasn't. I certainly want to serve. I want to find a way to contribute. I feel like people need to step up now. I feel like I want to step up. Whether running for the Senate in 24 is the way to do it or not, we haven't decided yet. We're, we're thinking about it, praying about it. It's a big, big thing for families to do it. It's not for the faint of heart. People ask me, what's it like? And I said, have you ever watched the movie Gladiator? And I said, yeah. Okay. So imagine that you're in the arena, you know, people in there throwing, you know, beer cans from the stands, people cheering for you, people throwing stuff at you, and you got your sword, you're in there by yourself, it's just you. And then all of a sudden the trap door comes up and there's the tiger, you know, so you kill the tiger and then

• 1:47:18Speaker 06

  next thing you know, there's the chariot. And, and you're just in the arena. And, you know, it's, it's a real privilege to do it, but it's a big, it's a big thing for a family. So we're thinking hard about it, but we haven't decided.

• 1:47:30Shawn Ryan?

  Which way are you leaning?

• 1:47:31Speaker 06

  I'm, I'm, I haven't decided, honestly. I mean, I would tell you if I, if I had, you know, I, my thought was that this book was a great way to crystallize where I think, I think the country needs to go. And a great way to get out there and talk about it. And talk about it in Pennsylvania, talk about it, you know, nationally. And I thought that that process would give me some data, give me a sense of whether it was resonating, give me a sense of whether, you know, I felt like I had something more to offer here. So, but I'll, I'll call you when I know.

• 1:48:04Shawn Ryan?

  All right. Well, I hope you do.

• 1:48:06Speaker 06

  Thank you.

• 1:48:07Shawn Ryan?

  I just want to say thank you for coming. It was an honor to. To be able to meet you and interview you and dig into your thoughts and I hope to see you again. My pleasure. Thanks for having me. Cheers. Great opportunity.