Speaker 1: This is Master's in Business with Barry Ridholds on Bloomberg Radio.
Speaker 2: This week. On the podcast, returning for her third time,
Speaker 2: Bethany MacLean, author of such amazing books as The Smartest
Speaker 2: Guys in the Room about the incredible saga of Enron
Speaker 2: and how it became one of the most respected companies
Speaker 2: in the world, and then blew up her new book,
Speaker 2: The Big Fail What the Pandemic Revealed about who America
Speaker 2: protects and who it leads behind with her co author Jonasara.
Speaker 2: First of all, I know Bethany for a long time,
Speaker 2: and I felt very comfortable really pushing back on some
Speaker 2: of the things she says in the book, but you know,
Speaker 2: to be honest, I couldn't really damage her thesis very much.
Speaker 2: The book is deeply researched and relies to a large
Speaker 2: degree on some nuance and a lot of science and
Speaker 2: a lot of the tropes that we all think about
Speaker 2: the pandemic. She's and Joe have thought deeply about and
Speaker 2: their approach is, Hey, this is not black and white.
Speaker 2: This is very complex. There were mistakes made at every level,
Speaker 2: from the White House to the CDC, and a lot
Speaker 2: of what went wrong during the pandemic predated COVID by decades,
Speaker 2: So a lot of nuance, a lot of subtlety, really
Speaker 2: very fascinating. She takes me to school time and again
Speaker 2: I found our conversation about the book fascinating, and I
Speaker 2: think you will do as well with no further ado.
Speaker 2: My discussion on COVID nineteen with Bethany MacLean.
Speaker 1: Thank you for having me on, Barry.
Speaker 2: My pleasure. So those books they're all about I guess
Speaker 2: giant mistakes, blunders seems to be your stock in trade,
Speaker 2: Enron Fracking, GFC, Fanny and Freddy, and now COVID nineteen.
Speaker 2: Where does this passion for disasters come from?
Speaker 1: Porn right? I don't know. I swear I'm a happy person.
Speaker 1: Maybe this is my way of unleashing my enter demons. No, seriously,
Speaker 1: I always think when something goes wrong, there's always a
Speaker 1: story about how and why it went wrong, And it's
Speaker 1: a story that is so much more than numbers. It's people,
Speaker 1: it's history, it's predilections, it's all these things. And I
Speaker 1: think trying to figure out what that mix is and
Speaker 1: what has happened is just a fascinating puzzle.
Speaker 2: So let's talk about the COVID nineteen puzzle. I found
Speaker 2: the book infuriating, just one unforced error after another. When
Speaker 2: you first sat down to write this, did you have
Speaker 2: any idea what you and Joe wanted to say? Or
Speaker 2: did it kind of develop as you progress?
Speaker 1: We had some loose ideas that ended up becoming part
Speaker 1: of the book. But I'd be lying if I said
Speaker 1: that it all hung together from moment one. I mean,
Speaker 1: I was passionately interested in the spring of twenty twenty,
Speaker 1: in the healthcare system and the effect of private equity
Speaker 1: and healthcare. I was interested in the Federal Reserve and
Speaker 1: how we thought about the Fed's response, And we were
Speaker 1: both interested in globalization and supply chains and what that
Speaker 1: had done to Ppe. So we had these loose ideas,
Speaker 1: but as to how they were going to come together
Speaker 1: into a coherent book, which which I hope we've produced.
Speaker 2: No, Oh, no, it's coherent. It's too coherent. And the
Speaker 2: coherence is pretty much everybody is grossly incompetent in an emergency.
Speaker 2: Kind of makes you nervous if, like what goes down
Speaker 2: when there's a really terrible earthquake or other disaster, lots
Speaker 2: of people seem to not have their act together.
Speaker 1: Yes, and no. I think the book probably does convey that.
Speaker 1: But then I think there are people that very much
Speaker 1: have their act together. I happen to think in the book,
Speaker 1: I think expresses that Operation Warp Speed is a tremendous
Speaker 1: success and a tremendous act of competence.
Speaker 2: So let me rephrase my criticism. Lots of people rose
Speaker 2: to the occasion, Yes, but it seemed like lots of
Speaker 2: institutions failed.
Speaker 1: I think lots of institutions did fail, and I think
Speaker 1: there are multiple reasons for that. I think one part
Speaker 1: of it is that pandemics had largely bypassed the US
Speaker 1: in the past, and we just simply weren't thinking that way.
Speaker 1: But I think a lot of our structures were also
Speaker 1: breaking even before the pandemic hit, such as our healthcare system,
Speaker 1: such as the way inequality has taken a toll on
Speaker 1: people's health and left people with pre existing conditions that
Speaker 1: made them more vulnerable and then made us all more vulnerable.
Speaker 1: And I think before the pandemic you could say that's
Speaker 1: them and this is us, and the pandemic made you realize.
Speaker 1: There's this great, great quote from Lyndon Johnson when he
Speaker 1: enacted Medicare and Medicaid, and it was basically, the health
Speaker 1: of our country is everything, because without a healthy population,
Speaker 1: what can we hope to achieve? And I'm butchering it
Speaker 1: a little bit, but that's the idea that if we
Speaker 1: aren't all healthy, we don't all have access to health,
Speaker 1: then what can we hope to achieve as a country.
Speaker 2: You spend a bit of time talking about our two
Speaker 2: tiered healthcare system. We'll get to that in a bit.
Speaker 2: Let's sort of flash back to the pre pandemic period
Speaker 2: and you talk about previous pandemics where we did pretty well.
Speaker 2: But it raises the question why were we so unprepared
Speaker 2: and why does it seem like nobody but Bill Gates
Speaker 2: really saw this coming.
Speaker 1: I think because it is beyond the human capacity to
Speaker 1: imagine that these things could actually happen. And I was
Speaker 1: thinking about this because I've said in the context of
Speaker 1: business disasters in the past that the old lesson from kindergarten,
Speaker 1: use your imagination is one of the most important lessons
Speaker 1: you can possibly learn, because if anybody ever says to you, oh,
Speaker 1: that can't happen, well, actually it can. And just look
Speaker 1: at the last couple of decades for instruction and to
Speaker 1: this idea that yeah, it can happen. And so I
Speaker 1: think we all have a failure to use our imagine
Speaker 1: and I think we're not good in this country at
Speaker 1: any kind of long term anything. And so we used
Speaker 1: to be, we used to be, and we exist from
Speaker 1: day to day driven by politics and polarization, and it
Speaker 1: makes it very difficult to have anything that involves the
Speaker 1: long term. And I think that's broadly true, not just
Speaker 1: about pandemics, but we saw that come home to roost
Speaker 1: in the pandemic.
Speaker 2: So you mentioned Operation warp Speed, arguably the greatest success
Speaker 2: of the Trump administration. It seems like he was almost
Speaker 2: embarrassed to be associated with a giant medical win.
Speaker 1: Well, I think it's I think it's it's more nuanced
Speaker 1: than that. I think Trump did support warp Speed, but
Speaker 1: somebody who was close to it said to me that
Speaker 1: Warpsbeed could never have succeeded in any administration but under Trump,
Speaker 1: precisely because Trump was so hands off and he just
Speaker 1: left it to run itself. And warp Speed wasn't really
Speaker 1: I mean, it was the Trump administration, but it was
Speaker 1: run by people who had either been marginalized in the
Speaker 1: Trump administration or really were not Trump supporters in any way,
Speaker 1: shape or form. So to see this as somehow a product,
Speaker 1: a Trumpian product, it wasn't, although it might have been
Speaker 1: enabled by some of the things that made Trump such
Speaker 1: a problematic president during during the pandemic, which I think
Speaker 1: is a fascinating a fascinating thing. You also have to remember,
Speaker 1: though Trump was supportive of the vaccines when they first
Speaker 1: came out, he was. It was as he started to
Speaker 1: realize that his constituents had become not supportive of the
Speaker 1: vaccines that was when he flipped. Even Trump got booed
Speaker 1: at a rally where he talked up the vaccines, and
Speaker 1: after that he never talked them up again. Really, yeah,
Speaker 1: So he followed the polarization in the country around the
Speaker 1: vaccines rather than necessarily driving it. Leadership leadership, right.
Speaker 2: You know, it's funny you said, I can't picture another
Speaker 2: administration doing it. Think about what Kennedy did with landing
Speaker 2: on the moon and setting up NASA and promoting it
Speaker 2: on a relentless and ongoing base. I can imagine a
Speaker 2: president of a different character and a I don't know,
Speaker 2: I don't know what the right word is. More serious maybe,
Speaker 2: but you more institutional I think.
Speaker 1: I think that The only counterpoint in it's so difficult,
Speaker 1: you can't go back and hit rewind and see how
Speaker 1: things could play out differently. The only counterpoint to that
Speaker 1: is that a different president might have been all over
Speaker 1: warp Speed from the beginning and might have made it
Speaker 1: very difficult for warp Speed to function because politics might
Speaker 1: have been injected in it. And Trump, because he was
Speaker 1: so hands off, actually allowed warp Speed to be run
Speaker 1: by monsef Slowie in general perna and that it worked.
Speaker 1: And so there, Oh, you don't see.
Speaker 2: You don't see either George Bush or Obama handing it
Speaker 2: off and saying do you They were both pretty good delegators.
Speaker 2: They might be unfairly respectful of the institution of government,
Speaker 2: at least outside of.
Speaker 1: I hope, so, I hope.
Speaker 2: So it just looks like I mentioned unforced eras Hey,
Speaker 2: the US had all these excess deaths. When you look
Speaker 2: at US on a per capita basis against comparable economies Germany, Switzerland, Japan, France,
Speaker 2: I mean they all did much better than US, obviously
Speaker 2: through countries like Italy that did poorly and China didn't
Speaker 2: do so great. We'll talk more about China later, but
Speaker 2: it seems like we were at the bottom of the
Speaker 2: Western industrialized democracies on a per capita death basis.
Speaker 1: We were. The economist has done a very good log
Speaker 1: of keeping track of excess deaths, and I think a
Speaker 1: couple of things account for that. I think our two
Speaker 1: tiered healthcare system, and I think some of what happened
Speaker 1: in COVID was that coming home to roost in the
Speaker 1: sense that COVID preyed upon people with pre existing health conditions,
Speaker 1: and pre existing health conditions are in some ways a
Speaker 1: byproduct of a healthcare system that doesn't take care of
Speaker 1: a lot of people.
Speaker 2: You mentioned diabetes and high blood pressure in particular. Yeah,
Speaker 2: and you know, a bad diet tends to be associated
Speaker 2: with lower economic strata. And if you don't have good
Speaker 2: healthcare and you have diabetes and you get COVID, not
Speaker 2: great outcome.
Speaker 1: Yep. It's also excess death captures things other than deaths
Speaker 1: from COVID too, And the deaths of despair in this country,
Speaker 1: and the desk from opioid to overdoses and lack of
Speaker 1: access to healthcare for other conditions not COVID are some
Speaker 1: portion of that too, we are a sicker country.
Speaker 2: So one of the more fascinating little tidbits you drop
Speaker 2: in the book, Most California cities end up pretty much
Speaker 2: in line in terms of per capita deaths with the
Speaker 2: rest of other large urban areas, the exception being the
Speaker 2: San Francisco. When you point to all the infrastructure put
Speaker 2: in place during the AIDS crisis that led San Francisco
Speaker 2: to a much better outcome, tell us a little bit
Speaker 2: about that.
Speaker 1: Yeah, it was fascinating, and this was highlighted our first
Speaker 1: written about in a really good New Yorker piece about
Speaker 1: what San Francisco was doing and why it's numbers were
Speaker 1: so low. And the idea was, you can't just lock
Speaker 1: down and leave the most defenseless parts of our population
Speaker 1: defend for themselves under a lockdown, meaning essential workers who
Speaker 1: still have to go out and do their jobs and
Speaker 1: then potentially bring the illness home to their communities. And
Speaker 1: because San Francisco had this infrastructure that was put in place,
Speaker 1: they knew how to reach all these marginalized populations. And
Speaker 1: because they knew how to reach them all, they were
Speaker 1: able to keep them healthier. And I think what that
Speaker 1: pointed at to us was you. Lockdowns were in many
Speaker 1: ways both an example of inequality and of furtherance of it,
Speaker 1: and that the very people who could lock down were
Speaker 1: the well off.
Speaker 2: So you throw pretty much everybody under the bus. Trump, Cuomo, Desanti's, Deblasio,
Speaker 2: cushn or Pence, even Fauci and lots of others. Will
Speaker 2: get into personalities later. But who came out of the
Speaker 2: pandemic with their reputation intact.
Speaker 1: Well, I think I don't think anybody intended to do
Speaker 1: a bad job, and people were placed into a difficult situation.
Speaker 1: It was hard when you look back at the terrible
Speaker 1: beginning of this in January and February of twenty twenty.
Speaker 1: If anybody had told you up until it happened that
Speaker 1: this was going to be a global pandemic and we
Speaker 1: would be living with this for years, you would have said, no, no, no,
Speaker 1: that can't happen, that can't possibly be true. We'll figure
Speaker 1: out a way around this. The United States always figures
Speaker 1: out a way around this. I think a lot of
Speaker 1: unheralded people came through this with their reputations intact, a
Speaker 1: lot of doctors and nurses who made things so much better.
Speaker 2: Than private citizens doing their.
Speaker 1: Private, private citizens doing job, but that official. But that
Speaker 1: whole list is all public officials. And I think some
Speaker 1: part of it is just a failure of leadership, a
Speaker 1: failure of anybody to really want to be accountable and
Speaker 1: to say the buck stops here in the way that
Speaker 1: General Perna actually did during Operation Warp Speed. And it's
Speaker 1: why I love the story of Operation Warp Speed so much,
Speaker 1: because I think it stands as a contrast to so
Speaker 1: much that happened elsewhere. It's an example of competence. It's
Speaker 1: an example of people saying the buck stops here, this
Speaker 1: is it, this is me, I'm the one responsible for this,
Speaker 1: and I'm going to make it happen. And when you
Speaker 1: look at so many other people, it wasn't that. It
Speaker 1: was deferral of responsibility, pushing things off on other people,
Speaker 1: or a failure to putting out there of rules and
Speaker 1: then a failure to live by them yourself.
Speaker 2: Let's talk about another giant fail China, not exactly the
Speaker 2: world's most responsible member of the global community. Tell us
Speaker 2: about some of the things China did that range from
Speaker 2: merely irresponsible to utterly reckless.
Speaker 1: Well, I think China, I don't think there's much question
Speaker 1: now that China understood what was happening and did not
Speaker 1: want to let the rest of the world know. And
Speaker 1: it's really frightening because the whole system relies on countries
Speaker 1: being honest when they've discovered some so that the rest
Speaker 1: of the world has a chance of protecting itself. But
Speaker 1: particularly I think the part that was the most devastating
Speaker 1: to me was the idea that China had a pretty
Speaker 1: good idea from the beginning that there was human to
Speaker 1: human transmission taking place, and even the who because China
Speaker 1: told them that it wasn't happening or there wasn't evidence,
Speaker 1: and so it took us a much longer than it
Speaker 1: then was necessary to understand that human to human transmission
Speaker 1: was happening.
Speaker 2: We figured out pretty quickly when someone came home from
Speaker 2: abroad and then their husband who hadn't traveled. God, it's like, oh,
Speaker 2: obviously it's human to human. Why the delay? It seems
Speaker 2: like the whole US National Institute of Health is designed
Speaker 2: for this information to bubble up to the top for
Speaker 2: a little commandment, control and communication. That didn't seem to happen.
Speaker 1: No, and the doctor and Wuhan, who was on the
Speaker 1: front lines of this alerted her superiors, and I think
Speaker 1: late December that she thought human to human transmission was happening.
Speaker 1: And so you think about that and how the whole
Speaker 1: course of the pandemic have been different if that knowledge
Speaker 1: had been out there from the very beginning.
Speaker 2: So let's talk about some of the broad policies that
Speaker 2: could have been in place on a timely basis but
Speaker 2: seemed to be mishandled. Testing, lockdowns, vaccines, personal protection equipment,
Speaker 2: PPE masking, social distancing. What in that list wasn't mishandled.
Speaker 2: It seems like across the board nothing was done right anywhere.
Speaker 1: So I think testing is a top the list of
Speaker 1: the things that were mishandled, and there was the CDC
Speaker 1: took control of the test and could not design a
Speaker 1: test that worked.
Speaker 2: You write in the book that they tried to manufacture
Speaker 2: this themselves. They have zero manufacturing expertise. What the hell
Speaker 2: were they thinking?
Speaker 1: I think the CDC has a culture that is arrogant
Speaker 1: and perfectionist and believes that they should be in charge.
Speaker 1: But even more broadly than that, even if the CDC
Speaker 1: test had worked, that should never have been the sun
Speaker 1: and moon and stars upon which America is testing strategy
Speaker 1: hung because we needed tests to be broadly available everywhere.
Speaker 1: And I think there's an intersection of interesting things there
Speaker 1: that we turn to the private market in a situation
Speaker 1: like this, and so part of one of the deeper
Speaker 1: themes of the book to me is when the private
Speaker 1: market works and when it doesn't. And we turned the
Speaker 1: private market in a situation like this and say, well,
Speaker 1: aren't companies going to manufacture test because they can sell
Speaker 1: them without any awareness of a couple of factors, which
Speaker 1: are the times in the past where companies have rushed
Speaker 1: a manufacture test only to have demand not materialize, and
Speaker 1: then they have to explain to their shareholders, oh, we
Speaker 1: invested all this money in this and it didn't actually happen.
Speaker 1: And then in modern day capitalism, the ongoing need for
Speaker 1: sustainable earnings such that if you do rush to develop
Speaker 1: tests and you sell them, but then demand goes away
Speaker 1: in two years, you don't get rewarded for that. And
Speaker 1: so I think a lot about where I thought a
Speaker 1: lot in the process of writing this book about where
Speaker 1: capitalism works and where it doesn't work. I'm a little
Speaker 1: more nuanced than maybe the book conveys about whether lockdowns
Speaker 1: could have been done anymore swiftly or the extent to
Speaker 1: which they should have been done. And I think the
Speaker 1: book conveys that second point very very well. I'm not
Speaker 1: sure if you had told Americans in February in January,
Speaker 1: we need to stay at home, nobody would have listened
Speaker 1: to you. Nobody would have believed you. Lockdowns can only
Speaker 1: be effective if you locked down before the virus is
Speaker 1: widely seated, right, That's the only way it works. But
Speaker 1: yet locking down before people know that the virus is
Speaker 1: how do you possibly pull that off, especially in a
Speaker 1: country like the United States. And so while that may
Speaker 1: seem like a failure, I'm not really sure it could
Speaker 1: that could have been done any differently. I think the
Speaker 1: bigger problem was the ongoing use of lockdowns, even without
Speaker 1: a clearly defined endpoint and without a clearly defined what
Speaker 1: are we doing this far start?
Speaker 2: So I'm going to come back to lockdowns in a minute.
Speaker 2: Let's stick with testing and masking, which I thought was
Speaker 2: kind of fat. We hadn't even rolled out tests, and
Speaker 2: you mentioned South Korea was doing some ungodly number of
Speaker 2: tests a day, one hundred thousand tests a day. They
Speaker 2: very quickly were able to figure out who to quarantine
Speaker 2: and who not to and had a much better outcome
Speaker 2: than we did. Various state institutions had the ability to
Speaker 2: create a test and have it outsourced and manufactured, but
Speaker 2: the CDC would not allow it. It seems like they
Speaker 2: were just the dumbest turf battles going on while the
Speaker 2: pandemic ramped up exponentially.
Speaker 1: I think that's a very good way of putting it,
Speaker 1: and I think there was also a failure to realize
Speaker 1: that things that we had put in place then made
Speaker 1: it difficult to roll out testing. So once an emergency
Speaker 1: was declared, then the FDA has to approve test. It
Speaker 1: is put in place so that you don't have shoddy
Speaker 1: test manufacturers running around selling tests that don't actually work.
Speaker 1: But when you need to get tests out the door quickly,
Speaker 1: the things that are put in place to protect people
Speaker 1: can backfire.
Speaker 2: So let's talk about PPE and MASK. Speaking of shoddy
Speaker 2: the government could have used one of the defense accent
Speaker 2: right to ramp that up. Instead, the White House led
Speaker 2: the states all compete with each other, absolute disaster profiteering, fraud.
Speaker 2: It was just again I'm reading this and just getting
Speaker 2: infuriated because all you needed was some leadership at the
Speaker 2: top to say, Okay, we're going to make sure that
Speaker 2: there's personal protection equipment for every doctor, every nurse, and
Speaker 2: every patient to help slow the spread of this that
Speaker 2: never happened was a free for.
Speaker 1: All, Yes, And to be clear, I'm not sure. So
Speaker 1: part of the theme of the book is that a
Speaker 1: lot of the problems were put in place before the
Speaker 1: pandemic even hit. Even if you had had that incredibly coordinated, sophisticated,
Speaker 1: competent response, we had outsourced so much of the manufacturing
Speaker 1: sharing of these critical things to China and elsewhere that
Speaker 1: we were left defenseless. And so I think the pandemic,
Speaker 1: as it has in many aspects, from semiconductors to PPE,
Speaker 1: it has to raise a question about what competence needs
Speaker 1: to remain in America and how much globalization, what the
Speaker 1: limits of globalization really should be, because it turns out
Speaker 1: when a global supply chain is stressed, it breaks down
Speaker 1: really really quickly, as we all know now. That said, yes,
Speaker 1: the stories about doctors and hospitals individually and states just
Speaker 1: scrambling to try to get PPE, and the number of
Speaker 1: frauds that so quickly sprung up, and these people trying
Speaker 1: desperately to get their hands on ppe and finding that,
Speaker 1: you know, paying this money and finding a box of
Speaker 1: dirty gloves would arrive and that was it. Just the
Speaker 1: profiteering really was utterly insane.
Speaker 2: Right, life and death at stake, And people like I
Speaker 2: can make a book on this. Yes, interesting story within
Speaker 2: the book about a small mask company that tried to
Speaker 2: set up in the United States and in the past
Speaker 2: had every time there's a potential pandemic by American even
Speaker 2: though it's a little more expensive, it doesn't go anywhere,
Speaker 2: and then starts ramping up fifty one hundred, one hundred
Speaker 2: and fifty million masks. But if you bought from this company,
Speaker 2: you had to sign a seven year contract. You figured out,
Speaker 2: you know the company I'm decrying too. And so now
Speaker 2: we actually have capacity to make masks in the United States,
Speaker 2: which really we didn't have pre pandemic.
Speaker 1: Right, And you just hope that there's a lesson taken
Speaker 1: from that. And again it's something that we just don't
Speaker 1: do well because I think we have this blind belief
Speaker 1: in the market and that the market forces are going
Speaker 1: to take care of issues like this without the recognition
Speaker 1: that there are a couple things that can go wrong
Speaker 1: in modern day capitalism, that the focus on profits, on
Speaker 1: pleasing shareholders, and on profits that can be sustainable, means
Speaker 1: that the response in a pandemic isn't going to be
Speaker 1: what you think. And then, because of this need to
Speaker 1: minimize costs in order to boost profits, this ongoing pressure
Speaker 1: for outsourcing of all sorts of critical infrastructure, that then
Speaker 1: makes it really difficult when you actually need something when
Speaker 1: the rest of the world needs it too.
Speaker 2: Last question on masks in want to just spend the
Speaker 2: whole two hours talking about this. Seems like there was
Speaker 2: a lot of confusion on masking early on, when it
Speaker 2: should have been the easiest thing to get right. You know,
Speaker 2: you go in for surgery, everybody in the operating theater
Speaker 2: wears a mask. It's pretty obvious it slows, if not stops,
Speaker 2: the spread of anything that's respiratory based. How did we
Speaker 2: screw that up?
Speaker 1: Well, I think there was a lack of recognition early on,
Speaker 1: a lack of knowledge. I won't call it recognition because
Speaker 1: I don't think it was there to be known about
Speaker 1: how the virus actually spread, So I think that's part
Speaker 1: of it. I think Fauci has explained his initial comment
Speaker 1: about against masking as an attempt to preserve ppe for
Speaker 1: doctors and nurses. But I do also think even as
Speaker 1: the pandemic war on, the communication about masking was not great.
Speaker 1: There was this for a long time, we all believed
Speaker 1: that those terrible little paper and cloth masks that people
Speaker 1: wore protected us, and they don't. Not really, a better
Speaker 1: mask protects you more. And it wasn't until a long
Speaker 1: time into the pandemic that everybody was finally clear, Yeah,
Speaker 1: if you really want to protect yourself, were can ninety
Speaker 1: five and if you really really need to protect yourself
Speaker 1: wearing it ninety five? These little paper masks that we wear,
Speaker 1: and we take them on and off, and we don't
Speaker 1: do what people in hospitals do, doctors and nurses, where
Speaker 1: you take them off with clean hands in a clean
Speaker 1: room and put them on. That's why it brought this,
Speaker 1: That's why they protect people in hospitals. They're not taking
Speaker 1: them on and off and using dirty hands and removing
Speaker 1: them to take a bite of something. And so to
Speaker 1: extrapolate from to extrapolate from whether or not masks work
Speaker 1: in a hospital setting to whether or not they work
Speaker 1: in a population at large, you can't it's two different things.
Speaker 2: So let me ask you the obvious question, how did
Speaker 2: this get it's so hopelessly politicized so quickly.
Speaker 1: Yeah, it's fascinating, right, because there is no way that
Speaker 1: in any kind of logical world, your beliefs about how
Speaker 1: you respond to a pandemic should have nothing to do
Speaker 1: with your political beliefs. In other words, it should be
Speaker 1: possible to be anti lockdowns. It could even be possible
Speaker 1: to be anti masking and to be a strident Democrat.
Speaker 1: And yet we conflated everything, and it became that if
Speaker 1: you were a good Democrat, then you believed in masking,
Speaker 1: in lockdowns, and if you were a good Republican, then
Speaker 1: you did not believe in any of this. And it's
Speaker 1: an insane example of how we're searching for polarization and
Speaker 1: we're searching for ways to turn against each other instead
Speaker 1: of ways to learn from each other and respect each other.
Speaker 2: The crazy thing about vaccines, and I've had this conversation
Speaker 2: with other people. The anti vass movement really was kind
Speaker 2: of a you know, California granola and nuts sort of
Speaker 2: left wing. Oh, I don't trust the government to give
Speaker 2: me a vaccine. That this is a giant experiment on
Speaker 2: the left to operation warp speed. The m RNA vaccines
Speaker 2: became Bill Gates is putting a chip in me on
Speaker 2: the right, and there's nothing that anybody can do to
Speaker 2: get the furthest outliers to recognize just some basic science.
Speaker 2: But what was shocking was how it went from the
Speaker 2: extremes of both parties and sort of moved to like
Speaker 2: center right and Senate left. It was genuinely shocking.
Speaker 1: Yeah. One of the things we chronicle in the book
Speaker 1: that is that I found interesting is that the anti
Speaker 1: VAC sentiment did start under Democrats when they were when
Speaker 1: they were the Trump vaccines, and so you had Democrats
Speaker 1: like Cuomo saying, I don't know about these things being
Speaker 1: rushed by Trump, and you had a lot of skepticism
Speaker 1: about the vaccines being generated by Democrats before the vaccines
Speaker 1: were even produced, and then once they were produced, and
Speaker 1: once the Biden administration started pushing them, it's as if
Speaker 1: as soon as Biden said that these vaccines are good,
Speaker 1: the anti VAC sentiment shifted to the right, because look,
Speaker 1: heaven forbid that Biden was saying and Democrats were saying
Speaker 1: something was good, then it had to be bad, and
Speaker 1: it just it really is just profoundly depressing and upsetting.
Speaker 2: You know, if you want to say, the first five
Speaker 2: hundred million vaccines, all right, this is a new vaccine,
Speaker 2: let's see what comes out of it. I don't agree
Speaker 2: with that, but I can follow the logic there. But
Speaker 2: when we're at the eight, ten, twelve billion shots with
Speaker 2: really very little side effects at that point that that
Speaker 2: argument seems to go away.
Speaker 1: Yeah. I think though the government has shot itself in
Speaker 1: the foot once again. And one of the other themes
Speaker 1: in our book is this loss of trust broadly speaking
Speaker 1: that had been taking place before the pandemic happened, of course,
Speaker 1: but the pandemic really exacerbated it. And I think the
Speaker 1: government public health officials did not do themselves any favors
Speaker 1: by overselling the vaccines. The original vaccines miracle basically a
Speaker 1: miracle of science.
Speaker 2: Right in like a decade. This wasn't done overnight, This
Speaker 2: was a decade, was worth.
Speaker 1: More than a decade in the works. But the clinical
Speaker 1: trials that proved the efficacy of the original vaccines did
Speaker 1: not measure whether or not they affected transmission. And so
Speaker 1: when public health officials went out there and said, if
Speaker 1: you take this vaccine. You can't pass this on, you
Speaker 1: won't transmit this is a pandemic of the unvaccinated. It
Speaker 1: was wrong. And so when you overseell to people based
Speaker 1: on something you don't know that you just hope is true,
Speaker 1: and then it turns out that's not true, you cause
Speaker 1: a lack of trust that then broadly undermines everything else
Speaker 1: you're saying. So again another unforced error on the part
Speaker 1: of the government. They could have sold the vaccines as
Speaker 1: doing what they did miraculously. Well, they protect you against
Speaker 1: severe outcomes. They protect most of us against hospitalization and death.
Speaker 1: Isn't that phenomenal, Instead of saying you won't get this
Speaker 1: if you take this vaccine, Yeah, that was kind.
Speaker 2: Of a big snaff foo. And to be honest, so
Speaker 2: I'm fully vaxed. I'm fully boosted. If the government said
Speaker 2: to me, well, we don't know if this will stop
Speaker 2: you from getting it, but it means that you're not
Speaker 2: gonna die. Okay, way do I sign up exactly? You
Speaker 2: didn'tumb for that.
Speaker 1: You didn't you didn't have to oversell it. But there
Speaker 1: was this belief that we wanted to get to her immunity,
Speaker 1: so you had to encourage everybody to take the vaccine
Speaker 1: and so overselling it and say you wouldn't saying people
Speaker 1: wouldn't get it. It was wishful thinking that in the most
Speaker 1: generous of interpretations, it was wishful thinking. But I think
Speaker 1: it did damage.
Speaker 2: I think you're right, And in fact, one of the
Speaker 2: groups that came up for criticism in the book is
Speaker 2: the Red Dawn Team highlighted in Michael Lewis's book The Premonition.
Speaker 2: You guys seem to be a little critical on some
Speaker 2: of their emphasis on Hey, this means the result in
Speaker 2: Italy means we could do lockdowns here.
Speaker 1: Yeah. I think critical is too strong a word. I
Speaker 1: think the idea that the Influenza Playbook would work with
Speaker 1: COVID is it was flawed and I think it did
Speaker 1: a lot of damage.
Speaker 2: Leane, Why is a coronavirus so different from an influenza infection.
Speaker 1: The biggest reason, and this is not a scientific answer,
Speaker 1: it's a practical answer. The biggest difference is that influenza
Speaker 1: schools are super spreading zones right with the coronavirus, they
Speaker 1: are not. In fact, it's been documented over and over
Speaker 1: again that the skip spread in schools is lower than
Speaker 1: that in the community, and so that playbook became I
Speaker 1: think part of the excuse for keeping schools closed in
Speaker 1: the United States in a way that did not happen
Speaker 1: in other countries.
Speaker 2: Point out in the book, and I thought this was
Speaker 2: a fascinating detail. In the pandemic of nineteen eighteen, thousands
Speaker 2: and thousands of young people died in the COVID nineteen pandemic.
Speaker 2: Young people seem to do fairly okay with this.
Speaker 1: They did. Young people with pre existing conditions did.
Speaker 2: Terribly, but everybody with pre existing.
Speaker 1: Everybody did, but very very few, a vanishingly small number
Speaker 1: of healthy young people got sick from COVID, And as
Speaker 1: I said, the spread in schools was lower than in
Speaker 1: the communities. That's why other places played in Europe, for example,
Speaker 1: open their schools. And I think the fact that we
Speaker 1: kept our schools closed has probably done more damage than
Speaker 1: just about anything in the pandemic, because you've lost a
Speaker 1: generation of young people who have lost their hopes for life.
Speaker 2: And I think, will you think it's that severe you
Speaker 2: have kids that are school aged, I think that's listen.
Speaker 2: I know lots of kids that miss proms, they missed graduations,
Speaker 2: they miss Barr and Bob mitzvahs and sweet sixteens and confirmations.
Speaker 2: So it was a rough year or two, obviously, nothing
Speaker 2: like World War two. But that those are formative years
Speaker 2: tell us a little bit about But these.
Speaker 1: Are but these but these are the privileged kids you're
Speaker 1: talking about, the ones with parents who could homeschool them,
Speaker 1: or who had a parent at home so that they
Speaker 1: could at least have supervision computers in high school while
Speaker 1: they did zoom schooling. It's the least privileged kids in
Speaker 1: our society, the very ones that were supposed to protect
Speaker 1: who got the most screwed by this. The ones whose
Speaker 1: parents were essential workers and had to go to school
Speaker 1: and had to leave the kids at home to try
Speaker 1: to manage on zoom. The many inner city kids without
Speaker 1: access to high speed internet and without a computer to
Speaker 1: do zoom schools. I mean, the numbers are shocking in
Speaker 1: school districts like New York and Chicago and LA. The
Speaker 1: percentage of absenteeism, the kids who just dropped out the
Speaker 1: test score showing how far behind kids are. You can
Speaker 1: argue kids are going to catch up. They're resilient. Maybe, Really,
Speaker 1: that's a very tough proposition to put on a twelve
Speaker 1: year old, Hey make up two years make or or
Speaker 1: or the kids who dropped out now somehow come back,
Speaker 1: and the kids who lost their path in life. And
Speaker 1: I think it's just devastating.
Speaker 2: Really very sad. And I learned a lot going through
Speaker 2: the book about the impact on that. The Red Dawn
Speaker 2: team talked about how close the desks are in school,
Speaker 2: how close the seats are on a bus. They're like,
Speaker 2: there's no social distancing in grammar schools. If this was
Speaker 2: a vector for transmission, you would think there'd be a
Speaker 2: lot more kids that were infected. How did the numbers
Speaker 2: shake out for the under twenty cohort versus the twenty
Speaker 2: to fifty cohorts.
Speaker 1: I think it's hard to know what the numbers were
Speaker 1: on infections because so many kids who got COVID were asymptomatic.
Speaker 1: I think you can look at the desks which are
Speaker 1: vanishingly small for people under twenty, and so that's the
Speaker 1: key measure that this was not influenza, which again back
Speaker 1: to your point about unforced errors. It is very hard
Speaker 1: to be prepared for a pandemic because every pandemic is different,
Speaker 1: and so if you followed an influenza playbook, you would
Speaker 1: have done things that didn't make sense in COVID. So
Speaker 1: it's just it's really hard. You have to maintain a
Speaker 1: degree of flexibility and a degree to see what's happening
Speaker 1: and react to what's actually happening. I happened to believe
Speaker 1: the Red Dawn groups emphasis on lockdowns that if only
Speaker 1: we had locked down sooner. H there's some truth to that.
Speaker 1: If we had locked down before the virus got here,
Speaker 1: maybe we could have prevented it from ever coming. But honestly,
Speaker 1: but if there was no will and if the rest
Speaker 1: of the world didn't lockdown, then at some point, what
Speaker 1: are you going to do? I mean, once this virus
Speaker 1: was broadly seated, it was trans it was broadly It's
Speaker 1: a highly infectious respiratory disease. And so what has always
Speaker 1: irritated me about the lockdown mantra is what's the endgame?
Speaker 1: Is the endgame minimizing the strain on hospitals? Okay, then
Speaker 1: let's do that until hospitals aren't strained. Is the endgame?
Speaker 1: Getting eradicating COVID not gonna happen. Not gonna happen. And
Speaker 1: guess what, as soon as you lift the lockdown, COVID
Speaker 1: comes back, look at what happened in China, and so
Speaker 1: and so that right, and so that's another example of,
Speaker 1: to me, a failure of leadership and a failure of
Speaker 1: government to articulate why exactly are we doing this and
Speaker 1: what's the endgame? And if you had done that, I
Speaker 1: don't think there would have been the same resistance to
Speaker 1: lockdowns that there was if it had been articulated what
Speaker 1: the endgame was.
Speaker 2: And to be fair to read Dawn, because I'm throwing
Speaker 2: them on the bus a little bit, they predicted eighty
Speaker 2: one percent of the US population would eventually be effected
Speaker 2: and as many as two million in the US would die.
Speaker 2: Those numbers turned out to be pretty dead on, right.
Speaker 2: So we're talking about catching this early. The one person
Speaker 2: in the Trump White House that was jumping up and
Speaker 2: down about this early on was Peter Navarro, who was
Speaker 2: widely yelling this is a giant pandemic threat. But he
Speaker 2: was also ignored. Yeah, why was that?
Speaker 1: Well, So there's this great quote in the book that
Speaker 1: the battle in the Trump administration was between those who
Speaker 1: wanted to do everything and those who wanted to do nothing.
Speaker 1: And unfortunately, and Navarro is the best example of this.
Speaker 1: Sometimes those who wanted to do everything had lost credibility
Speaker 1: for other reasons, and so Navarro had become known as
Speaker 1: kind of its, kind of aloney, and so he wasn't
Speaker 1: taken seriously on the thing that he should have been
Speaker 1: taken seriously on. It's a little bit. It's a version
Speaker 1: of the boy who Cried Wolf. And so you had that.
Speaker 1: You had that broadly speaking throughout the administration, where you
Speaker 1: had Bob Cadlac, for instance, coming up with this plan
Speaker 1: to distribute masks to every American household, but he too
Speaker 1: had lost credibility within the administration, so his plan to
Speaker 1: distribute masks went nowhere. The Trump administration was very adamized,
Speaker 1: and so you had these loyalties that existed and that
Speaker 1: dictated what could get done and who would be listened
Speaker 1: to in a way that is far more extreme than
Speaker 1: a normal administration, and a lot of undermining of political
Speaker 1: rivals and leaking in an attempt to establish one's superiority
Speaker 1: over one's rivals. And because Trump was known as a
Speaker 1: president who what was said and the press made it true.
Speaker 1: If you could get a story that was about arrival
Speaker 1: that was leaked to the press, and the press went
Speaker 1: with it. Then that became de facto truth, and so
Speaker 1: it was such a That's why you saw a volume
Speaker 1: of leaks and the Trump administration that Man, isn't it
Speaker 1: striking to you to look at the contrast between the
Speaker 1: Obama administration and now the Biden administration on the number
Speaker 1: of leaks, very very few, and the ones that come
Speaker 1: out of the Biden administration are clearly orchestrated.
Speaker 2: So let me invite a little maga hate mail. And
Speaker 2: I don't think I'm going on a limb when I
Speaker 2: say the Trump White House appointed a lot of people
Speaker 2: that just weren't perceived as serious players in the various institutions.
Speaker 2: But you can't help but look at the Trump White
Speaker 2: House and say, hey, if they were a little more
Speaker 2: serious and if they had put together a better team,
Speaker 2: this might have gone better.
Speaker 1: So I'm going to protest that a little bit. I think,
Speaker 1: for one thing, that a lot of very competent people
Speaker 1: did start off in the Trump administration. They just did.
Speaker 1: They just didn't last, but they did start right. I
Speaker 1: think there were competent people in the Trump administration even
Speaker 1: when the pandemic, like alluisays are I think they just
Speaker 1: they were fighting so many battles on so many fronts,
Speaker 1: and there was so much internescing warfare that it made
Speaker 1: it difficult for competence to rise to the top.
Speaker 2: And I think it's fair to hold the president and
Speaker 2: accountable for how is White House operates and who gets
Speaker 2: appointed to key roles.
Speaker 1: I do, but this is going to make you mad.
Speaker 1: But I think a point that's in the introduction that
Speaker 1: I think is important is that I think it's magical
Speaker 1: thinking to believe that the course of the pandemic would
Speaker 1: have been radically different had we had a different president
Speaker 1: in the White House. And all you need to do
Speaker 1: to see that is to see that more people died
Speaker 1: in the first year of the Biden administration than they
Speaker 1: did under Trump. So I don't I don't think it
Speaker 1: was it was It would have been that easy for
Speaker 1: any president. And I think a lot of that is
Speaker 1: are these pre existing conditions that we're talking about. Not
Speaker 1: just that the virus hit people with pre existing conditions
Speaker 1: particularly hard, but it hit a country, the United States,
Speaker 1: with pre existing weaknesses very hard in a way that
Speaker 1: would have been difficult for any president to snap his
Speaker 1: or her fingers and fix those.
Speaker 2: I totally agree with you. Why the White House just
Speaker 2: didn't take control of First it was Kushner, then it
Speaker 2: was Pence, and nobody could get that under control. You
Speaker 2: could have gone to the guy who ran Operation Warpsbeed
Speaker 2: and said, hey, who should we put in charge of PPE?
Speaker 2: You have beenwidth for that, or find us a guy
Speaker 2: in the military to do this, and that would have
Speaker 2: had a big difference. It just seemed, you know, so silly.
Speaker 2: And then the opportunism. That's the other thing in the
Speaker 2: book that was so infuriating. Political opportunism does not care
Speaker 2: about anything life, death, money. It will rise to the
Speaker 2: occasion every time.
Speaker 1: So I'm not, to be clear, I'm not defending Trump.
Speaker 1: I think his failure of leadership was massive. And even
Speaker 1: if you are a Trump supporter and you hate Fauci,
Speaker 1: then you have to look at that and say, well,
Speaker 1: then why did Trump allow Fauci to attain the preeminence
Speaker 1: he did? Because Trump didn't want to take responsibility. It's
Speaker 1: terrible across the board. So I'm not But at the
Speaker 1: very same time, it's possible to both believe that and
Speaker 1: to also believe what I do strongly, which is that
Speaker 1: it's magical thinking to say, oh, if only we had
Speaker 1: had a different president, everything would have been great, because.
Speaker 2: That reduced those one point.
Speaker 1: Perhaps could have could have made it better. I still
Speaker 1: think the United States outcomes would have been terrible, and
Speaker 1: I think we need to look at these underlying conditions
Speaker 1: in order to in order to have a chance of
Speaker 1: making it better the next time around. And so I
Speaker 1: think it's not only magical thinking, it's dangerous thinking to
Speaker 1: just say, oh, it's just all about Trump, because that
Speaker 1: then because then you miss you miss the real problems.
Speaker 2: Right to me, the most interesting part of the book
Speaker 2: was the hands that we were dealt coming into and
Speaker 2: when I not to make this about me, but when
Speaker 2: I was working on bailout Nation. As much as I
Speaker 2: wanted to blame George Bush, when you look at everything
Speaker 2: that took place before Bush took office, he was one
Speaker 2: of many, many players that led to that disaster. And
Speaker 2: all the people who said this is Bush's fault, it's like,
Speaker 2: what are you going to ignore twenty years of deregulation
Speaker 2: and radical low rates at the FED? And so I
Speaker 2: got very much got the same sense here the parallels
Speaker 2: to the financial crisis was, Hey, this wasn't anyone mistake.
Speaker 2: This was decades in the making, although truth be told,
Speaker 2: it seems like there was just one bad decision after another.
Speaker 2: I don't know if Obama would have done better or
Speaker 2: George Bush would have done better, but I can tell
Speaker 2: you this much, they couldn't have done work.
Speaker 1: That is probably true.
Speaker 2: Right, So let's talk a little bit about our broken
Speaker 2: ci and I mentioned earlier you throw everybody under the
Speaker 2: bus from Cuomo DeSantis de Blassio. You kind of focus
Speaker 2: on Cuomo and DeSantis throughout the books as two governors
Speaker 2: are a Northern Democrat a Southern Republican. What made you
Speaker 2: choose these two governors to focus on.
Speaker 1: Well, because their policies were so different in the pandemic,
Speaker 1: although they actually personality wise they might be more alike
Speaker 1: than they are different. I would be both dropped the
Speaker 1: ball right. But DeSantis obviously was the most prominent person
Speaker 1: who came out against lockdowns and Cuomo was very pro
Speaker 1: locking down, and so we thought it would set an
Speaker 1: interesting contrast. When we started the book, we didn't know
Speaker 1: what the answer would be and whose answer would turn
Speaker 1: out to be right, And as it turns out, it's
Speaker 1: pretty murky. Actually, who was right. But there's also there's
Speaker 1: a progression during the course of the book too, because
Speaker 1: I actually admired DeSantis for his stance early on in
Speaker 1: the pandemic. He I think he did follow this, and
Speaker 1: I think he did do the work himself, and I
Speaker 1: think it was not political. And then as he began
Speaker 1: to mount his presidential run, he became increasingly political and
Speaker 1: increasingly what I think, I like to believe he once
Speaker 1: would have not liked these things done solely for the
Speaker 1: purpose of politics, rather than things done because they're right.
Speaker 1: And he pushed the vaccines early on, and then he
Speaker 1: became the governor who wants to sue the vaccine manufacturers.
Speaker 1: It's just it's a disgusting example of how the desire
Speaker 1: to win at politics can take on a life of
Speaker 1: its own and overcome common sense.
Speaker 2: All right, So I have a ton of criticisms on Cuomo,
Speaker 2: But before we get to my form of governor, let's
Speaker 2: talk a little bit about DeSantis. Starting with spring Break
Speaker 2: twenty twenty, there was a move to close that down
Speaker 2: that became a super spreader event. You sent COVID back
Speaker 2: to fifty to other states. From there, he said, we
Speaker 2: don't want to shut it down because this is a
Speaker 2: big boom for our local business. How do you excuse
Speaker 2: putting one hundred thousand college students together twenty something college
Speaker 2: students together. How is that not going to send COVID
Speaker 2: back home?
Speaker 1: Well, I'm not sure the extent to which that was
Speaker 1: a super spreader event. I also think that some of
Speaker 1: what DeSantis insisted on early in the pandemic, which was
Speaker 1: that the evidence shows that it's safer outside and that
Speaker 1: it's safe to have the beaches open, he was right,
Speaker 1: and the people criticizing him were safer.
Speaker 2: Not safe, but safer, but safer.
Speaker 1: And by the way, some of the terrible things that
Speaker 1: happened in the pandemic came from keeping people cooped up
Speaker 1: in their houses, elderly people who didn't get out for years,
Speaker 1: whose dementia exacerbated. So you have to weigh, if you're
Speaker 1: a leader, you have to weigh some of these things
Speaker 1: against each other. Safer to be outside, yes, worth it
Speaker 1: to get people outdoors exercising, being able to see other
Speaker 1: human beings. Yeah. Maybe I'm a little less opposed to
Speaker 1: that aspect of DeSantis than you are.
Speaker 2: All Right, so let's talk about some of the other
Speaker 2: things Ron did. Governor Ron did he stopped reporting COVID data.
Speaker 2: Now I've heard the excuse. We didn't want to focus
Speaker 2: on this, we didn't want to panic people. But let's
Speaker 2: be honest, their numbers were terrible and he just didn't
Speaker 2: want to see it represent him. Come on, push back
Speaker 2: on that.
Speaker 1: I'm not sure that's true. I mean, some of the.
Speaker 2: Stuff Florida did terrible on a per capita basis your own.
Speaker 1: Justin Fox did an analysis of the desk coming out
Speaker 1: of Florida and California, and when you adjust it for age,
Speaker 1: which you have to because COVID kills the elderly, the
Speaker 1: numbers aren't that.
Speaker 2: So let me let me push back on this. And
Speaker 2: that's an email I sent to Justin said differently, Hey,
Speaker 2: we have a lot of elderly people in our state,
Speaker 2: and we did a terrible job protecting them.
Speaker 1: I'm not sure that's fair. So I think that the
Speaker 1: risk of dying from COVID goes up so dramatically when
Speaker 1: you were over sixty five? What does what does what
Speaker 1: does taking care of your elderly mean? DeSantis moved aggressively
Speaker 1: to try to protect people in nursing homes in a
Speaker 1: way that, by the way, New York in a way that,
Speaker 1: by by the way, by the way, New York did not.
Speaker 1: I think it remains an open question about COVID and
Speaker 1: protecting the elderly what you can actually do, because look,
Speaker 1: we all know people who lock down, who stayed home,
Speaker 1: who didn't do anything, who didn't who still got it.
Speaker 1: So if you're elderly and you're gonna get it, and
Speaker 1: then you're probably gonna die from it because you're elderly.
Speaker 1: To then blame the governor of a state with a
Speaker 1: lot of elderly for not being able to save I'm
Speaker 1: not sure about that. I blame I blame Dessantis for
Speaker 1: a lot and for how crazy he's become. I'm probably
Speaker 1: more pro his original strategy than you.
Speaker 2: Are, so let me blame her.
Speaker 1: Let me take that back. I'm not probably more pro
Speaker 1: his original strategy. I'm definitely more.
Speaker 2: So let me blame him for things that are unambiguous. Okay,
Speaker 2: he stops reporting the data, he fires his director of
Speaker 2: Health and Human Services, He points a surgeon general for
Speaker 2: the state who doesn't believe in vaccines and is a wacked.
Speaker 1: That comes later, That comes later.
Speaker 2: I'm looking at the continuum of him starting out with
Speaker 2: spring break, which there is there's a decent amount of
Speaker 2: evidence that suggests lots of people either got COVID, there
Speaker 2: a lot of hookups. You're not always outside at spring break,
Speaker 2: and then went back to their state and managed to
Speaker 2: spread it there to the live stream of the Health
Speaker 2: and Human Services director having her door kick down by
Speaker 2: a swat.
Speaker 1: Team that she turns out to be. And so if
Speaker 1: you read not only a little wacky, the whole thing
Speaker 1: turns out to be made up. And by the way
Speaker 1: that the press was all over that celebrating her glowing
Speaker 1: articles everywhere without ever and this is when you without
Speaker 1: ever looking at some of the facts underneath them. Should
Speaker 1: we really be celebrating this person? And so there was
Speaker 1: such an effort to get DeSantis early on, what about
Speaker 1: his in general, and then that contributes to some of
Speaker 1: his to some of some of the crazy.
Speaker 2: But she was not the person to.
Speaker 1: If you want to hold somebody up as being ill
Speaker 1: treated by DeSantis, Rebecca Jones, it's not the person.
Speaker 2: So let's talk about his surgeon general, who doesn't really
Speaker 2: think of VC like the CDC was regularly correcting some
Speaker 2: of his mistakes.
Speaker 1: So right and let's let's I know, you don't want
Speaker 1: to put things on a continuum. I'm going to put
Speaker 1: things on a continue that came later, and I am
Speaker 1: There's there's nothing about DeSantis' current stance on the vaccines
Speaker 1: that I think is defendable. I think it's morally reprehensible.
Speaker 2: So let's all right, so we're on the same page. Now,
Speaker 2: let's throw Cuomo into the bus a little bit. And
Speaker 2: similarly started out thinking, oh, okay, he is the guy
Speaker 2: on the ball, and then goes off the rails. He
Speaker 2: begins with these press conferences that kind of reminded me
Speaker 2: of Giuliani during nine to eleven, where there's this leadership
Speaker 2: var and somebody not the president steps up to fill
Speaker 2: the void. Were those conferences required viewing?
Speaker 1: They were absolutely required viewing. And I think that points
Speaker 1: to two things. I think it points to the earlier
Speaker 1: part of our discussion where we talked about Trump's failure
Speaker 1: of leadership. Had Trump been providing that leadership, there wouldn't
Speaker 1: have been a void that Quoma needed to fail, or
Speaker 1: that Cuomo could fail. But I think it also points
Speaker 1: to something else, which is the appearance of leadership versus
Speaker 1: actual leadership.
Speaker 2: So let's get into it, because he really so what
Speaker 2: he started out looking like, Oh my god, this guy
Speaker 2: is going to be president one day. Then let's talk
Speaker 2: a little bit about his feud with Mayor Deblasio in
Speaker 2: New York City, which was very much a hotspot in
Speaker 2: the beginning of the pandemic. What were the impacts of
Speaker 2: this childish feud on the healthcare of New Yorkers.
Speaker 1: So that even after the New York Department of Health,
Speaker 1: which is in the city's department, which are really well
Speaker 1: respected institutions, we're saying, we're seeing these upticks and all
Speaker 1: these measures that are alarming. This feud between Cuomo and
Speaker 1: Deblasio kept either from doing anything for a way too long,
Speaker 1: and so and then and then, of course, on top
Speaker 1: of it, Cuomo's policy of sending sick people back to
Speaker 1: nursing home that's my next which he blamed on the
Speaker 1: federal government. But look, if this were a federal if
Speaker 1: this were a federal government requirement, then it would have
Speaker 1: happened in every state.
Speaker 2: So let's clarify exactly what you're talking about, because it's
Speaker 2: literally my next question. There are elderly people who get
Speaker 2: sent from nursing homes to hospitals where they are identified
Speaker 2: as having COVID, and Cuomo's policy was to take them
Speaker 2: out of the hospital and send them back to the
Speaker 2: nursing homes where I have no idea what the thinking was.
Speaker 2: Maybe you could lock them in their rooms and not
Speaker 2: have the people who serve meals and go from room
Speaker 2: to room, not spread them around. It seems totally reckless
Speaker 2: and irresponsible.
Speaker 1: There is one possible reason for it, which is they
Speaker 1: were really worried about hospital space. Right, So there's this thinking,
Speaker 1: we'll free up hospital beds when I'm on an ice flow.
Speaker 1: But then two things have to happen. One, you have
Speaker 1: to be able to protect those people and protect the
Speaker 1: people around them when they get back to the nursing home.
Speaker 1: And secondly, you don't lie about it. And so those
Speaker 1: were the two big problems. And that's that old adage, right,
Speaker 1: the cover up is worse than the crime. If Fomo
Speaker 1: had just told the truth, right, I don't, I mean,
Speaker 1: he still would be where he is. The other.
Speaker 2: Accusations talk about rolling downhill. He just started out good,
Speaker 2: went off the rails and just man was it was
Speaker 2: like a wily coyote hitting the bottom of the Ravine.
Speaker 2: Let's talk about a few other people who may or
Speaker 2: may not have distinguished themselves. Anthony Fauci, How well did
Speaker 2: he perform?
Speaker 1: So my cauthorne I might have a little bit of
Speaker 1: a split on this. I'm probably more sympathetic to Fauci
Speaker 1: then Joe might be. I view any criticism Ofauci as misplaced,
Speaker 1: because it was the job of the president not to
Speaker 1: have Fauci in that role if he didn't want him
Speaker 1: in that role.
Speaker 2: But he got great media.
Speaker 1: But he got great media. And as if you're putting
Speaker 1: someone out there whose views you don't agree with, and
Speaker 1: then and then sort of ducking and saying, oh, look
Speaker 1: at what that guy's saying. I mean, it's just it's
Speaker 1: it's terrible, be accountable, say then I'm going to be
Speaker 1: the person speaking to the American public. It makes me.
Speaker 1: It makes me angry because putting someone in a role
Speaker 1: that maybe they shouldn't be in and then criticizing that
Speaker 1: person for being in that role seems to me to
Speaker 1: be one of the most hypocritical things you can do.
Speaker 2: I mean, but Trump seems to do that with every
Speaker 2: single person he appointed, and nobody ever says to him,
Speaker 2: why are you criticizing this person, Why don't you criticize
Speaker 2: the person who hired them? Oh wait, that's you. And
Speaker 2: at least with Fauci, we got the Curb your Enthusiasm
Speaker 2: memes we did, and which was to me the highlight
Speaker 2: of the past.
Speaker 1: I think you sent me one of those early on,
Speaker 1: and I think it might have been the highlight of
Speaker 1: the pandemic.
Speaker 2: Just like because you just see him drop his head
Speaker 2: into his hand when when Trump was talking about AMV
Speaker 2: was bleach or light or something and the music just
Speaker 2: it was chef's kiss? What about Jared Kushner?
Speaker 1: How did that back to Fauci?
Speaker 2: Me?
Speaker 1: I think there there are a couple of things that
Speaker 1: I don't understand why why Fauci did them, Either to
Speaker 1: say the least, the mask thing, the shutting down of
Speaker 1: any inquiry about the origins of the pandemic, which in
Speaker 1: a way, I don't really care where this thing came from,
Speaker 1: but the fact that we weren't allowed to discuss where
Speaker 1: it came from reflects well on nobody. The idea that
Speaker 1: you couldn't say that it might have been from inside
Speaker 1: a lab without being accused of being racist. And Fauci
Speaker 1: was part of shutting down that line of questions, Well.
Speaker 2: Whether it came from a lab or a Chinese wet market,
Speaker 2: I mean, he's still.
Speaker 1: China cares, but we should know and I.
Speaker 2: And we, so let me ask you that question. Since
Speaker 2: you references, where do we think the virus came from?
Speaker 1: I don't have a clue. But what I do know
Speaker 1: is that because the lines of inquiry were shut down
Speaker 1: early on, we probably never will know for sure. And
Speaker 1: I think that that's not a great outcome. And I
Speaker 1: think shutting down lines of inquorey are shutting down people
Speaker 1: with different opinions. Is just there's a line between that
Speaker 1: and quote misinformation, and I'm not really sure in a
Speaker 1: free society what we want to label misinformation. I detest
Speaker 1: that word. I think the other thing she tried to
Speaker 1: shut down were the scientists behind the Great Barrington Declaration.
Speaker 1: And again, I happened to be a believer in most
Speaker 1: forms of free speech, and.
Speaker 2: They walk that way back though the meta study, there
Speaker 2: were subsequent articles that said, well, this isn't exactly what
Speaker 2: we're saying. The whole mask thing. I think, if you're
Speaker 2: going into an operating theater, don't you check that box? Yes,
Speaker 2: I want everybody wearing surgical masks in there.
Speaker 1: I mean, I don't think the Great Bearrington Declaration said
Speaker 1: much about mask It was about it was about. The
Speaker 1: Great Barrington Declaration was about focused protection for the elderly.
Speaker 1: It was against lockdowns.
Speaker 2: The other stuff.
Speaker 1: And I think, and I think in a free society
Speaker 1: where polarization doesn't dictate what one is allowed to say
Speaker 1: and one is not allowed to say, there should have
Speaker 1: been a debate about that. And the scientists behind the
Speaker 1: Great Barrington Declaration were not French scientists, epidemiologists carverd epidemiologists
Speaker 1: at Stanford, epidemiologists at Oxford, highly respected people. Why is
Speaker 1: it so offensive to listen to them and to listen
Speaker 1: to what their plan is? It shouldn't be And so
Speaker 1: I don't love that Fauci was part of shutting that
Speaker 1: down and trying to discredit that.
Speaker 2: So let's talk a little bit about misinformation, because that
Speaker 2: leads to a couple of questions. Hydroxy chloroquin ivermectin bleach
Speaker 2: heard immunity. It seems like there was some really crazy
Speaker 2: nonsense coming from to some degree from social media. Also
Speaker 2: spread by social media, Facebook, Twitter, etc. Not so much
Speaker 2: LinkedIn as far as I could tell, and far more
Speaker 2: on the right wing than the left wing, other than
Speaker 2: the anti vax stuff which eventually morphed over. How do
Speaker 2: we judge our ability to deal with misinformation and how
Speaker 2: do we judge the performance of the US media?
Speaker 1: I think it's really difficult because the line between misinformation
Speaker 1: and information that we don't want to hear is can
Speaker 1: be a very fine line sometimes, and sometimes things that
Speaker 1: we label misinformation in a moment come back to perhaps
Speaker 1: maybe be something that we should have listened to. I
Speaker 1: guess my view on free speech is that if we
Speaker 1: believe in free speech, we should believe in free speech.
Speaker 1: Hate speech is a different matter, So I'm going to
Speaker 1: put that aside, okay, because I think all you need
Speaker 1: to do is look at the run up to World
Speaker 1: War two to see that that old adage that sticks
Speaker 1: and stones can break my bones, but words will never
Speaker 1: hurt me. It's words that create the sticks and stones. Right.
Speaker 1: But that's besides this conversation about.
Speaker 2: Yelling fire in a crowded theater. At what point is
Speaker 2: don't get vaccinated. It's a chip that will track you.
Speaker 2: How close is that to yelling fire in a theater?
Speaker 1: I think it's I think it's a long way away.
Speaker 1: And I think that when there is so much information
Speaker 1: out there to the counter about that, you actually do
Speaker 1: more damage by shutting people down and saying you can't
Speaker 1: say that than you do by saying, go ahead and
Speaker 1: say it. Sound crazy.
Speaker 2: People people literally Barber Streis and effect people.
Speaker 1: People, people can figure out their own their own information.
Speaker 1: There's enough out there running counter to that, so I
Speaker 1: don't I think it's a really tricky issue. But I
Speaker 1: think the pandemic, if anything, made me feel that we
Speaker 1: are very very quick to label things misinformation and we
Speaker 1: just don't like.
Speaker 2: It if we just disagree with it, all right, so
Speaker 2: we did Fauci. Let's talk about Jared Kushner and Mike Pence,
Speaker 2: who each took turns heading a task force on PPE.
Speaker 1: How those guys do I think Kushner, I don't think
Speaker 1: the task force that he set up to get PPE
Speaker 1: did that much. However, it's worth noting that some of
Speaker 1: the people running warp Speed, who were utterly opposed to
Speaker 1: Trump and too Trump's administration, came away supportive of Kushner
Speaker 1: because they thought that it was Kushner's support that guaranteed
Speaker 1: warp Speed's success, and it was Kushner who ultimately protected
Speaker 1: Warp Speed and both Monsoff Slowie, who is about as
Speaker 1: far from a Trumpian Republican as one could possibly be,
Speaker 1: actually said that he came away from this with a
Speaker 1: lot of respect for Kushner. So I think that it's
Speaker 1: possible to look at him as a mixed bag.
Speaker 2: So Chok went up for Jared Kushner. What about Mike
Speaker 2: Pence kind of that just went nowhere.
Speaker 1: I mean when Mike Pence, when Alex Azar was kicked
Speaker 1: off basically running the task force and Mike Pence was
Speaker 1: put in charge. It's hard to think of anything that
Speaker 1: happened at the Coronavirus Task Force after that other than
Speaker 1: Mike Pence's op ed in the spring of twenty twenty
Speaker 1: saying there won't be a second way. I think most
Speaker 1: people see him as the ultimate poly Titian, and that
Speaker 1: he was more focused on his own chances for a
Speaker 1: presidential run than he was on actually doing anything about
Speaker 1: the pandemic. That said, you have to have a little
Speaker 1: bit of admiration for Mike Pen's post.
Speaker 2: James tell us about Azar. I think a lot of
Speaker 2: people have no idea who he is or was during
Speaker 2: this era.
Speaker 1: So Asar was a Secretary of Health and Human Services
Speaker 1: and not a well liked figure within the Trump administration
Speaker 1: for reasons both good and bad. He developed a reputation
Speaker 1: for being hierarchical, being thin skinned, being a politician, but
Speaker 1: he was also he was an old school Republican in
Speaker 1: an administration where that was a very bad thing to be.
Speaker 1: I think it is impossible to look at alex Azar
Speaker 1: and not see a highly principled person who wanted to
Speaker 1: do the right thing. And at warp Speed is we
Speaker 1: have Asar in part to thank for warp Speed, and
Speaker 1: if it hadn't been for Azar getting behind warp Speed
Speaker 1: and pushing it again, warp Speed had several had several fathers,
Speaker 1: but Asar was definitely one of them. And so I
Speaker 1: think if you look at people's performance and you give
Speaker 1: them some dings but some positives, I think ultimately I
Speaker 1: came out positive on Asar.
Speaker 2: So let's stick with warp Speed for a second. Of course,
Speaker 2: the economy began to recover pretty quickly. He could have
Speaker 2: stepped up and said I did this, I saved America.
Speaker 2: Vote for me. I think he could have won if
Speaker 2: he had made better decisions about the pandemic.
Speaker 1: Well, I think I'm not sure that's true, because the
Speaker 1: vaccines weren't approved. The data about the vaccines didn't come
Speaker 1: out until after the election, because Trump had started to
Speaker 1: make some noises about having the vaccines ready before the election,
Speaker 1: and so the FDA pushed back and basically the leaders
Speaker 1: of the pharmaceutical companies said, this is not going to
Speaker 1: be political, and all of that was really important, and
Speaker 1: so to me, one of Trump's biggest failings was starting
Speaker 1: to make the vaccines political such that then you had
Speaker 1: to you had to have pushback so that people would
Speaker 1: try to trust them, absolutely able to trust them. I
Speaker 1: absolutely agree that if Trump had said these vaccines are marvelous,
Speaker 1: their life saving, that could have changed some of some
Speaker 1: of the course it would, but it would have been
Speaker 1: too late for his election. But that said, you have
Speaker 1: to ask the flip side of the question, given that
Speaker 1: you had Democrats including Cuoma and Kamala Harris coming out
Speaker 1: and saying, I'm not taking these Trump vaccines until they've
Speaker 1: been tested for safety.
Speaker 2: That's smart.
Speaker 1: If Trump had pushed them and called them the Trump vaccines,
Speaker 1: would you have had exactly the response from Democrats that
Speaker 1: we had said got from Republicans. Given how ridiculously polarized
Speaker 1: we are, would you then have had Republicans taking the
Speaker 1: vaccines and celebrating them and Democrats saying I'm not taking
Speaker 1: a Trump vaccine.
Speaker 2: Counterfactual is it's amazing.
Speaker 1: It's actually tragic that we even have to ask this question,
Speaker 1: because why should a vaccine be a Trump vaccine or
Speaker 1: a Giden vaccine. It's it's insane, it's insane.
Speaker 2: There was a big piece not too long ago, I
Speaker 2: don't remember if it was the Wall Street Journal of
Speaker 2: the Washington Post that showed that if you looked at
Speaker 2: a break the country down by zip code, red zip
Speaker 2: codes had much worse outcome than blue zip codes, And
Speaker 2: you kind of wonder, you can't help but wonder this
Speaker 2: has to be partisan based, whether you took the vaccine,
Speaker 2: got boosted socially distanced, unless you're going to say the
Speaker 2: red districts are just so much worse on the pre
Speaker 2: existing condition side, or some combination above.
Speaker 1: I think it's some combination of both. And again, I
Speaker 1: don't think anybody's done the work, nor I think is
Speaker 1: it possible to actually do the work and break it down.
Speaker 1: What percent of the problem came from people in Red
Speaker 1: states being less willing to get vaccinated, and what percentage
Speaker 1: of the problem came from the fact that pre existing
Speaker 1: health conditions that led one to terrible COVID outcomes were
Speaker 1: worse in many of those states, which brings us back
Speaker 1: and access to healthcare.
Speaker 2: Which brings us back to DeSantis, who has refused to
Speaker 2: embrace Medicaid and is leaving something like one hundred and
Speaker 2: fifty million dollars a year in healthcare aid to his state.
Speaker 2: Now work that out into those pre existing conditions a
Speaker 2: lot more medical care that buys you a decent amount
Speaker 2: of money every year. He has not embraced it. A
Speaker 2: handful of Red state governors have refused to embrace this,
Speaker 2: and I'm always shocked at how their population goes along
Speaker 2: with it. I don't want healthcare. What do I need
Speaker 2: that for? It's amazing, Yeah, it is so last institutions
Speaker 2: I have to ask about, how did the CDC, the
Speaker 2: National Institute of Health and Who perform ranked those three
Speaker 2: institutions who did most poorly? Who did least poorly. Notice
Speaker 2: I'm not saying any of them did especially well.
Speaker 1: I think that's hard because they all did different things.
Speaker 1: I think the CDC is at the bottom. I think
Speaker 1: it's hard and even the CDC, I think would say that.
Speaker 1: Rachelle Wilenski, when she was running the CDC, came out
Speaker 1: with this report basically that' said the CDC has failed
Speaker 1: and lost lost a lot of trust. The NIH not terrible, no,
Speaker 1: and it's the NIH that funded a lot of the
Speaker 1: development of mRNA led us to have the vaccines. You know, again,
Speaker 1: the existence of the vaccines is a long standing collaboration
Speaker 1: between government and industry. And so one of my key
Speaker 1: takeaways from the book is capitalism can't do everything. Markets
Speaker 1: can't do everything. You need a functioning government and functioning markets,
Speaker 1: and you need the two to be intertwined to have
Speaker 1: a functioning society.
Speaker 2: You can't get shareholders to say, I'm going to put
Speaker 2: money to this company and maybe in fifteen years we'll
Speaker 2: have a product we can and more.
Speaker 1: Even more so, you can't get shareholders to back vaccine
Speaker 1: development because too many times governments are the buyers of vaccines.
Speaker 1: The profits aren't big enough, and the need for the
Speaker 1: vaccines comes and goes, and so shareholders don't want anything
Speaker 1: to do with it because it's not sustainable earnings growth
Speaker 1: and so you have to be aware of where capitalism
Speaker 1: works and where it doesn't work. And that's one of
Speaker 1: the themes of the book The Who. I think initially
Speaker 1: you would give them bad marks for going along with
Speaker 1: China's view of the world and not being more independently minded. So,
Speaker 1: but it's hard to say. Over the course of the pandemic,
Speaker 1: I think the WHO has been able to acknowledge failings,
Speaker 1: so I'd give them. I'd give them an nih pretty
Speaker 1: decent marks.
Speaker 2: I'm kind of fascinated and I was like raised an
Speaker 2: eyebrow when I come across the chapter in the book
Speaker 2: on the Federal Reserve. Let's talk a little bit about
Speaker 2: what the FED did and didn't do. Starting with their
Speaker 2: initial thinking was, hey, interest rates don't cure pandemics. Tell
Speaker 2: us a little bit about what's going on at the FED.
Speaker 1: Well, I think you can't look at the pandemic without
Speaker 1: looking at the Federal Reserve. And for all sorts of reasons.
Speaker 1: One is that if it hadn't been for the fed's
Speaker 1: actions in the spring of twenty twenty, the world literally
Speaker 1: might have shut down. Markets are not incidental to life there,
Speaker 1: they're part of our life. That said, some of The
Speaker 1: problems that the FED had to fix were of the
Speaker 1: FED zone making, such as what a couple of decades
Speaker 1: of very low interest rates had done to our markets,
Speaker 1: such as the ongoing fragility of the system due to
Speaker 1: the shadow banking system, an ongoing kind of inability to
Speaker 1: deal with instability in the treasury market. One of the
Speaker 1: scariest things that happened in that spring of twenty twenty
Speaker 1: was that the treasury market almost stopped functioning. And that's
Speaker 1: people were aware even before the pandemic hit that there
Speaker 1: were these structural weaknesses within the treasury market. And then
Speaker 1: I think you have to look at the FED because
Speaker 1: of where we are today with inflation, and that's such
Speaker 1: a critical part of our economic lives now and such
Speaker 1: a critical part of inequality in terms of who inflation
Speaker 1: affects the most, and that's the FED. And so you
Speaker 1: have to understand that is of looking at the pandemic.
Speaker 2: So let's explore that a little bit more. Following the
Speaker 2: financial crisis, FED takes the rates down to zero, keeps
Speaker 2: him there, can't get inflation up to two percent a
Speaker 2: decade no inflation. We really haven't talked about the Cares
Speaker 2: Act and what a massive fiscal stimulus that was that
Speaker 2: we didn't see during the financial crisis. So let's put
Speaker 2: some numbers on that. CARES Act one under President Trump
Speaker 2: two point two trillion dollars, right, ten percent of GDP.
Speaker 2: You describe it as the biggest fiscal stimulus in US history.
Speaker 2: CARES Act two, almost another trillion dollars. Also under President Trump,
Speaker 2: CARES Act three another eight or nine hundred billion dollars.
Speaker 2: Under President Biden four trillion dollars. This is a huge stimulus.
Speaker 1: It's insane, and it has left our has helped leave
Speaker 1: our federal debt in a frightening place. Plus the impact
Speaker 1: on inflation, and there was a lot of thinking about
Speaker 1: the impact of fiscal stimulus and monetary stimulus right together.
Speaker 1: And so you're right, we didn't have that in the
Speaker 1: financial crisis, and I think it was a mistake. We
Speaker 1: had a very limited amount of fiscal stimulus because the
Speaker 1: idea was, oh my god, that the deficit and what
Speaker 1: are we doing? And so there was very quickly the
Speaker 1: Tea Party and the calls for austerity, and so we
Speaker 1: didn't do that much fiscal stimulus.
Speaker 2: And so the FED had a mediocre recovery because and
Speaker 2: so the FED.
Speaker 1: For that decade between the financial crisis and the pandemic,
Speaker 1: that decade plus felt promote the title of Muhammad al
Speaker 1: Aarian's great book that they were the only game in town.
Speaker 1: They were the only ones who could try to fix
Speaker 1: the economy. But that, to me is a little bit
Speaker 1: analogous to Fauci. Just like maybe Fauci shouldn't have been
Speaker 1: in the position he was in, the FED shouldn't have
Speaker 1: been in the position it was in. That's Congress's job. Again,
Speaker 1: it's a failure of government. It's a failure of Congress
Speaker 1: to default to the FED is the people who are
Speaker 1: supposed to fix the economy. It's not just the Fed's job.
Speaker 1: They've got one tool They've got the most limited toolbox
Speaker 1: of anybody in Washington to try to fix the economy.
Speaker 1: And yet they were the only game in town. And
Speaker 1: because interest rates were so low for that decade and
Speaker 1: there was so much bond buying, it left the FED
Speaker 1: in a weaker position to counteract the effects of the
Speaker 1: pandemic than they would otherwise have been in. And I
Speaker 1: think it's important to understand that again, these things have antecedents.
Speaker 1: They don't come out of nowhere right.
Speaker 2: It's always more complicated. One of the things that I
Speaker 2: think a lot of folks don't realize is when you
Speaker 2: take rates to zero, everything priced in credit and dollars
Speaker 2: is going to benefit from that. And that means stocks, bonds,
Speaker 2: real estate's business and who owns that the wealthier people
Speaker 2: in America. So the most fascinating takeaway from this massive
Speaker 2: fiscal stimulus, aside from the inflation, is hey, it did
Speaker 2: a pretty good job for the middle and lower class.
Speaker 2: They did okay, they still have some savings left over
Speaker 2: from twenty twenty and twenty one. So if you're looking
Speaker 2: at fiscal or monetary stimulus, recognize who is the beneficiary.
Speaker 1: Of yes, exactly whereas monetary stimulus made the rich richer.
Speaker 1: I mean, people said when the when the Fed began
Speaker 1: throwing everything it could at the wall, basically in the
Speaker 1: spring of twenty twenty, traders were like, this is the
Speaker 1: greatest trading opportunity the world has ever seen. And when
Speaker 1: you look at how staggeringly rich people with exposure to
Speaker 1: the markets got in in the year after the pandemic
Speaker 1: first hit, it's really I mean, it's sort of disgusting.
Speaker 2: From the lows in March twenty twenty. Till the end
Speaker 2: of the year, the S ANDB five hundred sixty eight percent.
Speaker 2: The following year up on ROMO was twenty nine thirty
Speaker 2: one percent. Every huge, reaching, explosive.
Speaker 1: Boom, everything was a screaming buy. And that benefits the
Speaker 1: segment of the American population that has exposure to as
Speaker 1: not the bottom. And then the bottom is left to
Speaker 1: fend for itself when and not to fend for itself,
Speaker 1: but the bottom is left to pick up the pieces
Speaker 1: when inflation kicks in, because guess who inflation hurts more?
Speaker 2: The less well off always. So let's talk. You know,
Speaker 2: it's funny. I'm gonna tell you a quick, funny digression.
Speaker 2: I'm at an event over the summer camp Kotok and
Speaker 2: we're talking about rising interest rates. And someone asked the question, Hey,
Speaker 2: will the wealthy benefit from higher rates or not? And
Speaker 2: three of us in the room, myself included, raised their
Speaker 2: hand and said, of course they will. You know what
Speaker 2: history has told us, the wealthy do just fine in
Speaker 2: all sorts of economies.
Speaker 1: Well, I agree, And it seems that everything we've done,
Speaker 1: from the financial crisis through to the pandemic response has
Speaker 1: helped the wealthy at the at the expense of the poor.
Speaker 1: And that's why I very much like the subtitle of of.
Speaker 2: Our boots left Beyond.
Speaker 1: Of our book, Who's getting left Who's getting left behind?
Speaker 1: And that it's true that the fiscal stimulus has done
Speaker 1: miracles for people at the lower end of the socioeconomic spectrum.
Speaker 1: So I don't want to discount that it was really.
Speaker 2: Reduce poverty for children.
Speaker 1: It had enormously effective. Nonetheless, a lot of the gains
Speaker 1: and wages have been eaten up by inflation. So once again,
Speaker 1: it's the people at the lower end of the socioeconomic
Speaker 1: spectrum who are left to who face the most pain
Speaker 1: from just about any policy.
Speaker 2: So one of the things we really haven't spoken about
Speaker 2: very much is the supply chain. I want to focus
Speaker 2: on semiconductors because you specifically write about Taiwan semiconductor and
Speaker 2: the shortage and how it's impacted everything from cars to computers.
Speaker 2: What drove that shortage and how much are we still
Speaker 2: dealing with the after effects of that.
Speaker 1: So it was just it was it was the increased
Speaker 1: demand combined with the increased time to ship. One CEO
Speaker 1: of a company told me it just it was like
Speaker 1: lost in translation. You just couldn't figure out where your gear,
Speaker 1: where your stuff was getting shipped from China. And so
Speaker 1: again it's this idea that we could and it's obviously
Speaker 1: stressed by the geopolitical tensions over Taiwan, but this idea
Speaker 1: that we could just mindlessly outsource everything that was critical
Speaker 1: to a very far away country and not maintain any
Speaker 1: capacity to do it here in the United States, and
Speaker 1: that was all going to be just peachy, kin it
Speaker 1: just I think the pandemic showed us that it's not
Speaker 1: that simple, and so now we're trying to figure out
Speaker 1: how to deal with that, especially with the geopolitical tensions
Speaker 1: over Taiwan, when you realize the United States literally can't
Speaker 1: break down if Taiwan semiconductor goes away because we've outsourced
Speaker 1: all of the critical manufacturing of semiconductors.
Speaker 2: So there's this ongoing political debate as to whether it's
Speaker 2: a pipe dream that we can bring manufacturing or critical
Speaker 2: manufacturing back to the United States. Can we bring semiconductor
Speaker 2: or evy battery production or next generation technologies like that here?
Speaker 2: Is this is this a pipe dream or is this
Speaker 2: a viable Hey, we can't leave it five thousand miles away.
Speaker 2: It just doesn't work for us.
Speaker 1: So I think the train has left the station on
Speaker 1: semiconductor manufacturing. When you look even at the a billions
Speaker 1: in the Chips Act, but you compare it to Taiwan
Speaker 1: Semiconductor's annual capbex budget, it's just there's no catching up.
Speaker 1: That doesn't mean we couldn't have manufacturing of some critical
Speaker 1: chips here in the US as a just in case backup,
Speaker 1: But I think the idea that we're ever going to
Speaker 1: become a manufacturing powerhouse of semiconductor chips. Ever, again, I
Speaker 1: think we let that go. And again i'd blame a
Speaker 1: monomaniacal focus on the bottom line. Hey, they can do
Speaker 1: it cheaper over there. Let's go do it cheaper over there,
Speaker 1: without any thoughts about the long term. I also think though,
Speaker 1: it raises another question that to me is interesting, which is,
Speaker 1: do you remember the whole fur in the global financial
Speaker 1: crisis banks too big to fail They've got tax payer support. Well,
Speaker 1: what about hospitals, They've got tax payer support. What about
Speaker 1: semiconductor manufacturing? Now with the Chips Act, they've got tax
Speaker 1: pair support. So this whole idea of capitalism in the
Speaker 1: market and it's pure. Well it isn't, and so that
Speaker 1: was one of my big takeaways from this is if
Speaker 1: all sorts of industries have to have taxpayer support when
Speaker 1: times turn tough, don't we need to rethink the contract
Speaker 1: between companies and society.
Speaker 2: You might have thought, and I admittedly this is all
Speaker 2: hindsight bias, that after nine to eleven we would have said, hey,
Speaker 2: we are now dealing with asymmetrical warfare, what do we
Speaker 2: need to do to make sure that just a defense
Speaker 2: department has access to what they need? That never seemed
Speaker 2: to happen, did it. I mean, it was chatter about
Speaker 2: it and then it just kind of faded the following quarter.
Speaker 1: Yeah, the Department of Defense has done this report, the
Speaker 1: Industrial Capabilities Report, every year, and it's pointed out that
Speaker 1: do to shareholder pressure to generate earnings, that all these
Speaker 1: critical aspects of manufacturing have gone overseas. And so it's
Speaker 1: easy to not pay any attention to that if you're
Speaker 1: just focused on this quarter's earnings or this year's earnings.
Speaker 1: But if you're actually focused on what the United States
Speaker 1: needs to do to be strong, you need to have
Speaker 1: a different set of values at work.
Speaker 2: So Lennon was right. The capitalists will sell you the
Speaker 2: rope to hang you business.
Speaker 1: It might be true. I mean, I'm still going to
Speaker 1: defend capitalism is a version of Winston Churchill's quote about
Speaker 1: democracy the worst possible system with the possible exception of
Speaker 1: everything else up there. But I do think we need
Speaker 1: to have a discussion about where capitalism is appropriate and
Speaker 1: where it's not, and what's fears of life it should
Speaker 1: be contained, and what its limitations are.
Speaker 2: So I have another four hours worth of questions for you,
Speaker 2: but I know you have a lunch date, So let's
Speaker 2: jump to our speed round and we'll blow through these
Speaker 2: five questions as quickly as possible, starting with what have
Speaker 2: you been streaming these days? What's been keeping you entertained?
Speaker 1: So this is going to make you unhappy. But I
Speaker 1: grew up without a TV set, and I did, and
Speaker 1: I see there's amazing. We might be the only two
Speaker 1: people in the world.
Speaker 2: Who can say that I wasn't allowed to watch Oh.
Speaker 1: We didn't even have one. My parents still don't have one,
Speaker 1: so I don't. I don't stream that much.
Speaker 2: I know it's audio. I have.
Speaker 1: I have some things that i've that I've listened to
Speaker 1: that I love, but I default to a book when
Speaker 1: I'm when I'm left alone audio. I have been loving
Speaker 1: Huberman's podcast on health and longevity. He has a great
Speaker 1: podcast that just came out on meditation that makes you
Speaker 1: think really differently about meditation.
Speaker 2: Umen. Yeah, I'm going to check out. Yeah. Let's talk
Speaker 2: about your mentors who helped shape your career as a writer.
Speaker 1: So Joon No Sarah, who's my co author on this book,
Speaker 1: and my co author and all the devils are here
Speaker 1: and edited the smartest guys in the room. He was
Speaker 1: my editor at Fortune for a lot of years, and
Speaker 1: he taught me and still teaches me to this day,
Speaker 1: a lot about writing and storytelling.
Speaker 2: Since we mentioned books, let's talk about some of your
Speaker 2: favorites and what you're reading right now.
Speaker 1: So I do a podcast with a guy named Luigi's
Speaker 1: and gallis at the University of Chicago, and I think
Speaker 1: I have to read a ton for that, as you
Speaker 1: do for this. It's a lot of work, right, But
Speaker 1: I think the books that I read for the podcasts
Speaker 1: that have been most influential for me were two contradict
Speaker 1: reviews on meritocracy, one by professor at Harvard named Michael Sandel,
Speaker 1: and the other by a professor at Oxford named Adrian Woldridge,
Speaker 1: and one is kind of a defensive meritocracy and the
Speaker 1: other is skepticism about meritocracy. So Adrian Wildridge's book is
Speaker 1: The Aristocracy of Talent, How meritocracy made the modern world?
Speaker 1: And Michael Sandel's book is called The Tyranny of merit
Speaker 1: Can We Find the Common Good? And I'd say Sandel's
Speaker 1: perspective on meritocracy is quite skeptical, and Wildridge's book is
Speaker 1: more of a defensive meritocracy. And they're a really interesting,
Speaker 1: interesting juxtaposition. And then don't laugh. I am a huge
Speaker 1: consumer of fantasy novels, and so I am also reading
Speaker 1: The Wheel of Time, which has which has just become
Speaker 1: a Netflix series, and I swear I'm going to stream
Speaker 1: that as soon as I finished the books.
Speaker 2: Oh, I didn't know you were a fantasy fan. Give
Speaker 2: me some other authors you like? So, because I go
Speaker 2: back to like Peer's Anthony and.
Speaker 1: Early So do I back back to Tolkien? Of course? Yes,
Speaker 1: that's a gimme game, owns of course. George double R.
Speaker 2: Martin, I would like to read that. I started watching
Speaker 2: it and said, I got to read.
Speaker 1: This I know I read. I read them all, but the.
Speaker 2: Probably as great as everyone says.
Speaker 1: They're as great as everybody says. The problem is now
Speaker 1: I can't watch the show because it's so stressful to
Speaker 1: read those books that you can't relive some of the
Speaker 1: high moments of high stress.
Speaker 2: You know, he kills a lot of people.
Speaker 1: There's there's another So I have a fourteen year old
Speaker 1: daughter and a twelve year old daughter, so I consume
Speaker 1: an inordinate amount of fantasy novels and I can't keep
Speaker 1: all the names straight because that's what my daughter reads.
Speaker 1: But right now I'm in the process of reading some
Speaker 1: by a woman named Rissa Meyer, which are rewrites of
Speaker 1: fairy tales from a different perspective and they are super interesting.
Speaker 2: And the Last kind of Wicked, which is told from
Speaker 2: the witch's perspective.
Speaker 1: Yeah, or like Maleficent. But back to things that.
Speaker 2: I love Moens so do I.
Speaker 1: But back to things that I read as a child
Speaker 1: that I think are really interesting to reread. Now I've
Speaker 1: been rereading a lot of Isaac Ossamov.
Speaker 2: Unbelievable.
Speaker 1: I think, in this in this era where we're talking
Speaker 1: about AI, to realize how incredibly prophetic Awesomov was with
Speaker 1: his three Laws of Robots and his and his and
Speaker 1: his thoughts about the world. He's a terrible writer, and
Speaker 1: you have to struggle through his prose, but if he
Speaker 1: read it, yes, he is terrible.
Speaker 2: He's a great storyteller, and some of his some of
Speaker 2: his prose is not the most polished. But his idea
Speaker 2: is everything.
Speaker 1: Well, that's exactly his prose is. His prose is clunky,
Speaker 1: and his characters are one dimensional, but his ideas and
Speaker 1: the fact that he could see all of where we
Speaker 1: are today from when he was writing, I just think
Speaker 1: it's it's fascinating.
Speaker 2: So foundation trilogy. Robert C. J. Serrah Larry Nivin. The
Speaker 2: last question is Anthony I mean to say nothing of
Speaker 2: Philip K. Dick, which is just next.
Speaker 1: Level, Yes, and and the and the greatest of all Dune.
Speaker 2: Right, you know, I've been plowing through the most recent
Speaker 2: and version. It's like every time there's a decade goes by,
Speaker 2: someone reattempts to redo that story and it's just too grand.
Speaker 2: Unless you're going to do Lawrence of Arabia, right, you
Speaker 2: just can't do Dune. And it seems every attempt has failed.
Speaker 2: What sort of advice would you give to a recent
Speaker 2: college grad interested in a career in either investing finance
Speaker 2: or journalism.
Speaker 1: And journalism a career in journalism, I might say, find
Speaker 1: something else where you can make money. And then right
Speaker 1: on the side, No, seriously, I would say to anybody
Speaker 1: interested in anything, just do something. You never know where
Speaker 1: your path in life is going to take you. But
Speaker 1: if you don't do anything, then you know where it's
Speaker 1: going to take you, which is nowhere. And so if
Speaker 1: you're not sure what you want to do, just go
Speaker 1: do things. Go do interesting things. Go try to be
Speaker 1: around smart people doing interesting things. I began my career
Speaker 1: working at Golden Sechs, and I do something very different
Speaker 1: from that now. But I wouldn't have the career I
Speaker 1: have now if I hadn't started working working at Goldman
Speaker 1: And so just do things, and what you do, we'll
Speaker 1: open up other doors that will take you someplace else.
Speaker 2: And our final question, what do you know about the
Speaker 2: world of investing finance writing today? You wish you knew
Speaker 2: twenty twenty five years ago when you were first getting started.
Speaker 1: I wish I had understood that it wasn't just about numbers,
Speaker 1: that it's about people. It's about history. You have to
Speaker 1: understand psychology, You have to understand the past. That makes
Speaker 1: it so much more interesting and infinitely and just interesting.
Speaker 1: And I wish I had understood what we talked about
Speaker 1: earlier on the podcast, which is that that most important
Speaker 1: rule is the thing you used in kindergarten, which is
Speaker 1: use your imagination because anything can happen. And don't ever
Speaker 1: look at the world and say no, no, no, that
Speaker 1: can't happen. And Ron can't be a fraud, it's the
Speaker 1: most respected company in America. Or no, no, no, the
Speaker 1: big banks on Wall Street can't go bankrupt. Look at
Speaker 1: their multi billion dollar balance sheets and their gleaming headquarters.
Speaker 1: This can't happen. Or a pandemic can't shut down in
Speaker 1: the United States for two or three years. God knows
Speaker 1: that can't happen. Everything can happen, So just remember, use
Speaker 1: your imagination.
Speaker 2: William Goldman's is penned my favorite expression of all time.
Speaker 2: Nobody knows anything right.
Speaker 1: That is pretty fantastic.
Speaker 2: Bethany, thank you for being so generous with your time.
Speaker 2: We have been speaking with Bethany MacLean, co author of
Speaker 2: The Big Foul. If you enjoy this conversation. Be sure
Speaker 2: and check out any of the previous five hundred plus
Speaker 2: discussions we've had over the past nine years. You can
Speaker 2: find those at YouTube, Spotify, iTunes, wherever you find your
Speaker 2: favorite podcasts. Sign up for my daily reading lists at
Speaker 2: ridolts dot com. Follow me on Twitter at Barry Ridholt's
Speaker 2: Be sure and check out all of the Bloomberg Family
Speaker 2: of podcasts at podcasts. I would be remiss if I
Speaker 2: did not thank the crack team that helps these conversations
Speaker 2: get done each week. Anna Luke is my producer. Sarah
Speaker 2: Livesey is my audio engineer at Teak of Albron is
Speaker 2: our project manager. Sean Russo is my researcher. I'm Barry Rutults.
Speaker 2: You've been listening to Masters in Business on Bloomberg Radio.