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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This is Wall Street Week. I'm David Weston bringing you

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Speaker 2: stories of capitalism. With all the talk about housing affordability,

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Speaker 2: is there anything we can do to make houses cheaper

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Speaker 2: instead of just helping people pay more. Our new contributor

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Speaker 2: Christia Freeland travels to Sweden to see how it works

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Speaker 2: when we manufacture houses instead of building them. And we

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Speaker 2: all make mistakes, whether we like to admit them or not.

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Speaker 2: Two people well known to Wall Street, Josh Steiner and

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Speaker 2: Michael Linton, have come clean about their big embarrassing mistakes,

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Speaker 2: one at Sony Pictures, the other at the Treasury Department.

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Speaker 2: In their new book, From Mistakes to Meaning, they show

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Speaker 2: us why learning from ar mistakes is both harder and

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Speaker 2: more important than we thought. But we start with that

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Speaker 2: big story of a duel between the Supreme Court and

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Speaker 2: President Trump.

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Speaker 3: In a few moments, I will sign a historic executive

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Speaker 3: order instituting reciprocal tariffs on countries throughout the world. Reciprocal

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Speaker 3: That means they do it to us, and we do

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Speaker 3: it to them. They're all coming in over the next week.

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Speaker 3: We're making deals with all of them. And I said,

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Speaker 3: if we don't make a deal, then we're going to

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Speaker 3: tariff them an extra five, six, seven, eight percent. Whatever

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Speaker 3: the difference is, it will take it that way. The

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Speaker 3: Supreme Court's ruling on tariffs is deeply disappointing, and I'm

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Speaker 3: ashamed of certain members of the Court, absolutely ashamed for

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Speaker 3: not having the courage to do what's right for our country.

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Speaker 2: That played out this week when the President gave his

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Speaker 2: State at the Union address with the members of the

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Speaker 2: Court right up front. Jason Furman Harvard takes us through

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Speaker 2: the ramifications of the conflict for the economy and what

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Speaker 2: likely comes next. So, Jason, we heard from President Trump

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Speaker 2: this week in the State of the Union dress, and

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Speaker 2: he sort of gave us state of the economic Union,

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Speaker 2: and among other things, he said, we have plunging inflation,

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Speaker 2: we have rapidly rising incomes, and the economy's roaring like

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Speaker 2: it's never roared before. Is he right.

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Speaker 4: To a first approximation, the year since Donald Trump became

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Speaker 4: president economically was very similar to the year before he

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Speaker 4: was president. It's actually been a perfectly good year. It's

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Speaker 4: not the horror that Democrats might have predicted, but it's

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Speaker 4: certainly not any sort of turning point. That Donald Trump

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Speaker 4: was trying to brag about either.

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Speaker 2: As an economist, looking at the US economy right now,

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Speaker 2: what are the strong points?

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Speaker 4: You know, we've had steady growth. It continued in twenty

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Speaker 4: twenty five at the same pace it was in twenty

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Speaker 4: twenty four, which was a pretty good pace. There's some

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Speaker 4: tentative signs that maybe productivity growth is picking up a little.

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Speaker 4: It's only a smidge, but hopefully it's a hint of

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Speaker 4: what's to come. The unemployment rate has basically stabilized.

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Speaker 2: How much of that good news in the economy do

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Speaker 2: you think is because of AI, both the investment in

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Speaker 2: AI and the promise of AI. I think some of

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Speaker 2: it is.

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Speaker 4: AI was a big factor on the demand side in

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Speaker 4: the economy in twenty twenty five. It could be an

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Speaker 4: even bigger factor in twenty twenty six. That's all the

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Speaker 4: money that's spent building data centers, the energy to supply them,

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Speaker 4: and the like. We're only just starting to see the

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Speaker 4: first hints of AI showing up on the supply side

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Speaker 4: of the economy. Productivity growth in twenty twenty five looks

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Speaker 4: like it'll be maybe a little bit above the pace

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Speaker 4: we had in the previous cycle. But only a little

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Speaker 4: bit above, so you know, early days on supply, but

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Speaker 4: a lot of demand.

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Speaker 2: When it comes to tariffs, President Trump in his remarks

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Speaker 2: made it clear he's sticking with tariffs. Whatever the Supreme

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Speaker 2: Court sitting right in front of him thinks about tariffs,

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Speaker 2: he's going to go ahead with him. What has that

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Speaker 2: really done to the economy. Has it had a lot

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Speaker 2: of effect?

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Speaker 4: I think it is subtracted a bit from growth and

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Speaker 4: added a meaningful amount to inflation.

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Speaker 2: The inflation one.

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Speaker 4: Is easier to prove. You can just look through the

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Speaker 4: different types of goods and furniture, consumer electronics, and you

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Speaker 4: see those prices rising, and normally you would have expected

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Speaker 4: them to be stable at a time like this, So

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Speaker 4: it really is showing up. Is it a dramatic recession

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Speaker 4: or an apocalypse? Definitely not. In fact, the models never

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Speaker 4: predicted that you would have something that dramatic. But that

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Speaker 4: doesn't mean that we should be blase about what might

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Speaker 4: be tens of billions of dollars of damage to the economy.

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Speaker 2: Business leaders often talk about uncertainty and how that is

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Speaker 2: really a dampener on growth for them. Whatever the terarif

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Speaker 2: rate is, tell me what it is. And I'll deal

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Speaker 2: with it as opposed to I'm not sure. There's been

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Speaker 2: a lot of uncertainty, both in the way the terrorists

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Speaker 2: were imposed and now with the Supreme Court decision. Can

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Speaker 2: can you approximate what that might mean for the economy.

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Speaker 2: Is it having an effect on the economy.

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Speaker 4: Probably it leads to some delay of investment, some desire

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Speaker 4: to do things overseas rather than in the United States.

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Speaker 4: Supreme Court decision I think ultimately will give us more

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Speaker 4: certainty because the AEPA tariffs that the president had been

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Speaker 4: doing before, he'd been constantly changing them at a drop

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Speaker 4: of a hat. He didn't like the tone of voice,

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Speaker 4: didn't like a television ad in another country. You know,

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Speaker 4: tariffs go up. The new authorities that he's still going

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Speaker 4: to have, like Section three oh one, take more time

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Speaker 4: and effort. They're hard to change them on a dime.

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Speaker 4: And so if he wants to have high tariffs, we're

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Speaker 4: going to have high tariffs. He can't quite change them

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Speaker 4: on a whim in the way he was doing before

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Speaker 4: under the new legal regime.

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Speaker 2: Over and above the direct effect on trade from tariffs,

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Speaker 2: there are also these agreements that the Trump administration has

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Speaker 2: been entering into or trying to enter into, and they

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Speaker 2: involve investment in the United States and other sort of concessions.

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Speaker 2: How much could they help the economy or in their absence,

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Speaker 2: hurt the economy.

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Speaker 4: I think most of those agreements are relatively minor. They're

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Speaker 4: repackaging stuff that probably already would have happened any way.

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Speaker 4: Or maybe you get more investment coming from Japan or

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Speaker 4: Korea in one form, but then they buy fewer treasuries

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Speaker 4: and you get less investment in some other form, and

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Speaker 4: it all washes out on the other end. So I

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Speaker 4: don't see very much upside for the US economy from

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Speaker 4: those agreements.

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Speaker 2: In his State of the Union address, President Trump suggested

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Speaker 2: once again that maybe tariffs could replace income tax. How

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Speaker 2: feasible is that?

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Speaker 4: That's ludicrous? Income tax collects over ten trillion dollars over

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Speaker 4: the next decade and the tariffs are in the hundreds

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Speaker 4: of billions per year. That there's no comparison between them.

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Speaker 2: Even if the tariffs cannot replace income tax, it is

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Speaker 2: money coming into the treasury at a time that goodness knows,

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Speaker 2: the United States could use money coming in to the treasury.

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Speaker 2: No matter who gets to be president, do you think

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Speaker 2: we can ever take these tariffs back off. From a

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Speaker 2: fiscal side.

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Speaker 4: The one respect in which tariffs are working is they

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Speaker 4: are raising revenue. It's just that there are so many

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Speaker 4: other ways to raise revenue that would be less harmful

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Speaker 4: to the US economy. So I would much rather we

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Speaker 4: not frame the discussion around do we want tariffs or nothing.

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Speaker 4: I'd rather the conversation be do we want tariffs or

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Speaker 4: do we find another way to replace that revenue, maybe

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Speaker 4: also do some spending cuts. That's much more economically sensible.

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Speaker 2: The Supreme Court struck down President Trump's tariffs, something the

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Speaker 2: President called unfortunate, but the Justice has left it to

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Speaker 2: the lower courts to decide on appropriate remedies. Before the decision,

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Speaker 2: we went over the options with Jennifer Hillman, a Senior

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Speaker 2: Fellow for Trade and International Political Economy at the Council UNFORMEDS.

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Speaker 5: So if the court rules that the tariffs were illegal

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Speaker 5: from the get go, then then the teriffs must be

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Speaker 5: refunded to those that have paid them. And if we look,

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Speaker 5: you know today through at least the end of August,

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Speaker 5: that means about eighty eight to one hundred billion dollars

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Speaker 5: worth of tariffs would need to be refunded to the

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Speaker 5: importers that paid those tariffs in the first instance, because

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Speaker 5: if they're unlawful, then everyone is entitled to a refund

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Speaker 5: with interest.

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Speaker 2: Is there a mechanism for doing that? That sounds like

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Speaker 2: an enormous undertaking?

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Speaker 5: There is a mechanism, but you are corrected is an

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Speaker 5: enormous undertaking, and it basically splits out into whether or

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Speaker 5: not the particular import of this particular item in this

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Speaker 5: particular shipment, whether or not all of the paperwork that

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Speaker 5: Customs has to do about those has closed or not.

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Speaker 5: You know, in customs parlance we say the entries have

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Speaker 5: been liquidated. So for all of the entries that have

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Speaker 5: not yet closed out, everyone can go back in and

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Speaker 5: say I made a mistake in essence on my declaration

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Speaker 5: I don't owe any tariffs under IEPA, I'm going to

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Speaker 5: change my declaration and I don't owe any of these tariffs,

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Speaker 5: and you owe.

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Speaker 6: Me a refund.

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Speaker 5: For all of the entries that have already closed out,

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Speaker 5: then there is a one hundred and eighty day period

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Speaker 5: in which you can file effectively a protest that in

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Speaker 5: essence says to the custom service you overcharged me, and

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Speaker 5: you owe me a refund. But again, the Trump administration

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Speaker 5: could make this a very easy, straightforward process everybody that

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Speaker 5: applies automatically gets their refunds, or they can make it

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Speaker 5: a very difficult process if they want to challenge each

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Speaker 5: and every entry, if they want to say, you need

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Speaker 5: to provide more information. You haven't given us everything that

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Speaker 5: we need, they could make this a very difficult process.

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Speaker 2: You know.

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Speaker 5: And again for the big importers that have all of

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Speaker 5: the paperwork readily available, they are likely to again go

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Speaker 5: ahead and move to process all of their refunds. It's

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Speaker 5: going to be those small businesses, and they're the ones

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Speaker 5: that have been hurting the most from these terror they're

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Speaker 5: going to have the most difficulty if this process is difficult.

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Speaker 5: They don't know exactly what paperwork to file. If the

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Speaker 5: Trump administration would decide to try to fight all of

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Speaker 5: this and make everyone challenge in individual lawsuits, the question

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Speaker 5: will come whether all these small businesses do they have

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Speaker 5: enough money to pay the legal fees, do they know

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Speaker 5: how to go through the process, and whether or not,

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Speaker 5: again this is going to be a requirement that you

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Speaker 5: have to do this entry by entry, or whether there's

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Speaker 5: going to be a much broader ability to process refunds

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Speaker 5: more again on a group and on a sort of

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Speaker 5: nationwide basis. So again it's going to depend. But as

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Speaker 5: a matter of law, if the tariffs are illegal, refunds

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Speaker 5: should be paid.

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Speaker 2: Up. Next, coming to terms with our most embarrassing mistakes.

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Speaker 2: In a new book, authors Michael Linton and Josh Steiner

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Speaker 2: come clean and teach us something about how we can

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Speaker 2: truly learn from those mistakes we'd rather forget. This is

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Speaker 2: a story about not letting bygones be bygones. We like

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Speaker 2: to say that we can learn from our mistakes, but

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Speaker 2: when it's a big, truly embarrassing mistake, we sometimes do

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Speaker 2: everything we can not to revisit it. Now, two names

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Speaker 2: well known to Wall Street had decided to write a

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Speaker 2: book unpacking what went wrong for them and why, for

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Speaker 2: Michael Linton when he ran Sony Pictures and for Josh

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Speaker 2: Steiner when he was Chief of Staff to the Treasury

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Speaker 2: Secretary in the Clinton administration. Their book is from Mistakes

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Speaker 2: to meaning owning your past, So it doesn't own you.

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Speaker 2: Words matter, and it's mistakes to meaning, not failures to meaning.

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Speaker 2: That's an important distinction.

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Speaker 6: WK.

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Speaker 7: Yeah, it's a really important point.

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Speaker 8: For us, there have been great books written about success

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Speaker 8: and about failure, and we think of success and failure

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Speaker 8: as siblings. You know, in both cases you have a

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Speaker 8: group of people. They come to get they're trying to

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Speaker 8: do something meaningful, they have a plan to do it.

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Speaker 8: In one case it turns out well. In the other

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Speaker 8: case it doesn't. But they're both intentional. One way to

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Speaker 8: think about it, at least the way we thought about

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Speaker 8: it was there's a reason we say marriages fail, and

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Speaker 8: that if you get married at three am in Vegas

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Speaker 8: after a couple of cocktails, that's a mistake. In the

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Speaker 8: case of marriage, people come together, they want to do

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Speaker 8: something meaningful. It doesn't work out, so it failed. But

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Speaker 8: mistakes are something that you'd do without self awareness, without

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Speaker 8: understanding the context in which you're operating, and then you

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Speaker 8: end up regretting.

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Speaker 6: And the other thing is that maybe with the exception

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Speaker 6: of marriage, not that many people have the opportunity at failures.

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Speaker 6: You know, it does require a pretty substantial or significant

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Speaker 6: decision to be made. Mistakes everybody makes them, and they

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Speaker 6: make them all day long. So we knew it. It was

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Speaker 6: fertile ground.

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Speaker 7: And the surprising part is no one talks about them.

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Speaker 8: As soon as we go on Amazon or Barnes and Noble,

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Speaker 8: we're going to find eighteen books on the subject. And

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Speaker 8: we couldn't find one good book about the concept of mistakes.

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Speaker 8: We found a gazillion books about success, lots of books.

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Speaker 7: About failure, and not one about mistakes.

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Speaker 2: Was there a magic moment for this book between the two.

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Speaker 6: Of you, there was. It involved a walk on the

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Speaker 6: beach and Josh coming up with this idea. Josh could

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Speaker 6: probably tell the story the best because he was the

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Speaker 6: one who actually thought of the idea in the first place.

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Speaker 8: Both of us had a mistake that we'd been living

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Speaker 8: with and had never spoken about, and in my case,

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Speaker 8: I had suppressed it ineffectually for many, many years.

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Speaker 6: When you came up with the idea and said to

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Speaker 6: me we should write a book about mistakes, it really

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Speaker 6: landed because I myself had been living with something for

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Speaker 6: a long time that I really did not want to address.

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Speaker 9: Michael has this nice thing about mistakes our windows into ourselves, and.

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Speaker 2: That's where Allison Papadoccas came into the picture. Papa Dooccas

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Speaker 2: is a professor of psychology who studies stress and coping

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Speaker 2: at Johns Hopkins University.

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Speaker 9: So Josh and Michael started off with wanting to look

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Speaker 9: at mistakes, and they really started off more on their

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Speaker 9: own with it, and then they realized that they wanted

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Speaker 9: a little bit more input, so they brought me. But

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Speaker 9: a lot of what came across in the book is

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Speaker 9: their own ideas about things, and then they were sort

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Speaker 9: of wanting to check it out. Does this really align

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Speaker 9: with the psychological literature and research, And that's where I

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Speaker 9: came to try to help them to see this really

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Speaker 9: does actually make sense and it's not bunk. You guys

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Speaker 9: are coming up with good ideas, and then around their stories,

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Speaker 9: I helped them to just go a little bit deeper

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Speaker 9: and then started to recognize patterns in their lives over

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Speaker 9: time that got reflected.

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Speaker 6: Everybody has a lot of mistakes. I had a few myself,

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Speaker 6: most of them having to do with my professional career,

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Speaker 6: and I wrote up one or two before that, and

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Speaker 6: then I realized I was avoiding the main event, which was,

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Speaker 6: you know, the cyber attack that happened to Sony ten

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Speaker 6: years ago, and that there was a mistake at the

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Speaker 6: core that caused the events that led ultimately to the

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Speaker 6: cyber attack.

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Speaker 10: The FBI is investigating that destructive cyber attack at Sony Pictures.

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Speaker 7: This is costing Sony hundreds of millions of dollars.

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Speaker 1: Ten minutes ago, now the FBI announced it's formally accusing

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Speaker 1: North Korea of hacking Sony Pictures.

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Speaker 2: So, at the core, what do you look back and

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Speaker 2: think was your mistake involved in the Sony situation.

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Speaker 6: At the core core, it was agreeing to make the

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Speaker 6: movie the interview.

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Speaker 11: You want us to kill the leader of North Korea.

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Speaker 6: And in retrospect, it was definitely a bad decision and

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Speaker 6: it was definitely one that put the company in jeopardy.

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Speaker 2: You talked about three acts right for the mistake, So

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Speaker 2: there's a prey lude, what led up to it, there's

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Speaker 2: a mistake itself, and then there's the post lube. You

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Speaker 2: described in the book you had put in place a

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Speaker 2: rigorous process for greenlighting movies.

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Speaker 6: Yeah, we had a very very strong process that had

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Speaker 6: been in place for many years before that. We didn't

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Speaker 6: suddenly get emotionally connected to an idea or a project

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Speaker 6: and say let's go. But as opposed to that, you

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Speaker 6: get people around the table from different disciplines and they

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Speaker 6: give their voice to whether you know, the marketing folks

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Speaker 6: telling you whether it's a good idea of the production folks.

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Speaker 6: That was not the case when we agreed to make

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Speaker 6: or I agreed to make the interview.

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Speaker 2: Which leads to the question why why on that one.

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Speaker 6: I had been in the job for a while, over

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Speaker 6: a decade, and I was typically the person in the

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Speaker 6: room who was mister no. I was actually the guy

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Speaker 6: in the suit.

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Speaker 2: You know.

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Speaker 6: Everybody else around the table, for the most part, were

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Speaker 6: people who were either directly creative executives or interacting a

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Speaker 6: lot with creative executives, and I was the person who

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Speaker 6: was expected to be the adult in the room. There

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Speaker 6: was a moment where I really did not want to

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Speaker 6: play that role. I really wanted to be on the

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Speaker 6: other side of the table, so to speak, with the

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Speaker 6: creative community. And I in that moment, I said, Okay,

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Speaker 6: let's go, let's make this movie, and through all of

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Speaker 6: those careful processes out the window.

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Speaker 8: I think it took us a while in Michael's case,

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Speaker 8: to figure out what the three acts were, and the

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Speaker 8: first act for Michael was actually your childhood.

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Speaker 6: I had grown up in Westchester, I'd grown up in Scarsdale,

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Speaker 6: and I was upended in the late sixties and moved

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Speaker 6: to Holland. And you know, my parents themselves were immigrants,

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Speaker 6: so they weren't very sympathetic to my sister. In my situation,

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Speaker 6: we were very lonely and that existed for a number

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Speaker 6: of years and it had a big effect on me,

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Speaker 6: and I think Josh is right, that's ultimately what played

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Speaker 6: a part in my decision to do this and Act two.

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Speaker 2: One of the things that struck me in reading the

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Speaker 2: book about what happened in that room at the table

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Speaker 2: reading yeah, was the hydraulic pressure.

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Speaker 6: Yeah. So what the circumstances were was everybody at that

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Speaker 6: point really wanted to make that movie. We'd had great

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Speaker 6: success with Seth Rogan comedies in the past. This was

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Speaker 6: it read funny on the page. Everybody wanted to do it.

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Speaker 6: And there was an added circumstance, which was there was

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Speaker 6: a competitive studio, Universal, which also had a relationship with

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Speaker 6: Seth Rogan, and they wanted to make the movie. So

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Speaker 6: it had all come down to this moment to make

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Speaker 6: that decision. And I sat there and you're right, the

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Speaker 6: entire room was raring to go, and I got caught

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Speaker 6: up in the moment. You know, By the time the

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Speaker 6: read through was finished, everybody was high fiving, clapping. It

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Speaker 6: was hilarious. You know, there were things in the script

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Speaker 6: I should have been paying attention to, not least of

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Speaker 6: which that we assassinated the leader of the hostile nation,

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Speaker 6: Kim joum mun. But in that moment, I was so

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Speaker 6: caught up in it. I so wanted to shed my suits,

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Speaker 6: so to speak, and be part of the gang. Then

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Speaker 6: I said, sure, let's go.

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Speaker 2: So you made your mistake, Green Lay went into production,

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Speaker 2: went along, and at some point you basically lost your

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Speaker 2: computer system and even lost the information in it which

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Speaker 2: could be misused. Give us a sense of how large

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Speaker 2: those consequences were in your world.

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Speaker 6: So we say, yes, the thing goes into production. And

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Speaker 6: then at the June of that year, we put out

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Speaker 6: a trailer to say the movie's coming in the Christmas season.

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Speaker 6: And at that point, the North Korean government threw the

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Speaker 6: envoy in New York sort of sent us a warning

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Speaker 6: that something bad could happen. We checked with the State Department,

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Speaker 6: we checked with Rand Corporation. No, these guys are all bark,

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Speaker 6: no bite, don't worry about it. Nothing can ever happen.

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Speaker 6: So it turns out they were referring to Kim Jung Ill,

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Speaker 6: not Kim Jung Un. He was new on the scene.

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Speaker 6: They didn't really understand what he was capable of. We're

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Speaker 6: now in the fall, and all of a sudden, I'm

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Speaker 6: driving to work and I get a panicked call from

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Speaker 6: my CFO, Dave Hendler, and he says, everything is down.

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Speaker 6: All of our systems are fried. And when I finally

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Speaker 6: got to the studio and we started looking at it,

380
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Speaker 6: seventy percent of our laptops were knocked out and some

381
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Speaker 6: In the weeks following this is all well known. The

382
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Speaker 6: email started coming out. It was like ground zero for

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Speaker 6: the news. Everybody was looking at Sony. By the way,

384
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Speaker 6: nobody was helpful. Everybody else ran for the hills because

385
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Speaker 6: all of these emails started coming out, and by the way,

386
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Speaker 6: movies started coming out up on our systems. We had

387
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Speaker 6: the Karate Kid that suddenly was available for people to

388
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Speaker 6: watch online, all because our systems got hacked. Plus we

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Speaker 6: couldn't operate the studio for at least a week because

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Speaker 6: there was no way of moving material around.

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Speaker 2: So you had the distinction of having President United States

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Speaker 2: call you out on your mistake.

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Speaker 6: I was going on Freed Zakaria show to try and

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Speaker 6: explain what was happening at that moment. Min at the studio,

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Speaker 6: it was sort of we were a quarterway through the

396
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Speaker 6: whole series of events, and at that point they had

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Speaker 6: not yet identified with absolute certainty that it was the

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Speaker 6: North Koreans who had done it. So just before I

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Speaker 6: went on the show, Freed Zakari said to me, Oh,

400
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Speaker 6: the President. They've just announced that it was the North

401
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Speaker 6: Koreans and the President is going to do a quick

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Speaker 6: press conference.

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Speaker 7: Hello, everybody.

404
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Speaker 6: The President was taking some questions from reporters and the

405
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Speaker 6: reporter said a what are you going to do about

406
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Speaker 6: the North Koreans and bing to what do you think

407
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Speaker 6: of what Sony has done?

408
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Speaker 10: Sony suffered significant damage, there were threats against its employees.

409
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Speaker 10: I am sympathetic to the concerns that they faced. Having

410
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Speaker 10: said all that, yes, I think they made a mistake.

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Speaker 6: What he didn't fully comprehend, in which I sort of

412
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Speaker 6: laid out in the interview with Freed Zakaria, was that

413
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Speaker 6: it wasn't our decision at that point because the theaters had

414
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Speaker 6: declined to show the movie. Streaming didn't exist in that moment,

415
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Speaker 6: so we had no way of getting the movie out,

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Speaker 6: So I, in a funny way, the president misunderstood what

417
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Speaker 6: we were trying to do in that and of itself

418
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Speaker 6: was a mistake. Having said that, he in a very

419
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Speaker 6: gracious act, about ten days later called me a apologizing

420
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Speaker 6: for saying what he said, which was not necessary. But

421
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Speaker 6: secondly he did say, but what were you thinking making

422
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Speaker 6: a movie where you assassinate the leader of a hostile nation?

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Speaker 6: Like surely that was a mistake. And on reflection, and

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Speaker 6: in that moment I suddenly realized he's right. He identified

425
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Speaker 6: the mistake, and that was actually a mistake.

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Speaker 2: Would it have been different if you'd had all the

427
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Speaker 2: time in the world to think it through, to talk

428
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Speaker 2: to Josh about it? Would it have come out differently?

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Speaker 6: I think my life would have been different. Yes, I

430
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Speaker 6: think had I at an earlier moment reflected on it

431
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Speaker 6: understood what the root cause was, understood really how I

432
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Speaker 6: felt about it emotionally, I would have been able to

433
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Speaker 6: keep my head upright in a much better way than

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Speaker 6: I did. Instead, what I wound up doing was I

435
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Speaker 6: am the minute it was behind me. I really never

436
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Speaker 6: wanted to look at it again. I really took the attitude. Okay,

437
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Speaker 6: that's over. Let's not reflect on it. Let's not consider

438
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Speaker 6: why I did that in the first place. Let's just

439
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Speaker 6: move forward. And I can honestly say that was a

440
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Speaker 6: that in and of itself was a mistake. I imagine for

441
00:22:27,160 --> 00:22:30,439
Speaker 6: a long time that every time I walked years after

442
00:22:30,480 --> 00:22:32,719
Speaker 6: the event, that every time I walked in the room

443
00:22:32,960 --> 00:22:36,240
Speaker 6: of any event, any a dinner, a party, just a

444
00:22:36,240 --> 00:22:38,879
Speaker 6: group of people, my own family, what they see on

445
00:22:38,920 --> 00:22:42,320
Speaker 6: my forehead as Sony Hack. That's what I imagined, when, of course,

446
00:22:42,880 --> 00:22:45,159
Speaker 6: for the ninety nine percent of the population, it was

447
00:22:45,160 --> 00:22:47,280
Speaker 6: completely in the rear view mirror and it never came

448
00:22:47,320 --> 00:22:47,840
Speaker 6: to their mind.

449
00:22:48,080 --> 00:22:50,200
Speaker 8: This is an example of where Alison was super helpful,

450
00:22:50,400 --> 00:22:53,159
Speaker 8: because Alison educated us about something called the spotlight effect.

451
00:22:53,359 --> 00:22:54,679
Speaker 9: I mean, many of the mistakes in the book were

452
00:22:54,720 --> 00:22:56,800
Speaker 9: public one, so of course it's going to happen more

453
00:22:56,840 --> 00:22:59,320
Speaker 9: in those kinds of situations. But even for people who

454
00:22:59,320 --> 00:23:01,520
Speaker 9: weren't making public mistakes are talking about them in a

455
00:23:01,560 --> 00:23:04,680
Speaker 9: public sort of way, it still happens on a day

456
00:23:04,680 --> 00:23:08,200
Speaker 9: to day basis. We worry that our colleagues, our friends,

457
00:23:08,200 --> 00:23:10,680
Speaker 9: our family, that they're thinking about these things, when in fact,

458
00:23:10,800 --> 00:23:12,120
Speaker 9: usually it's just us.

459
00:23:12,640 --> 00:23:15,080
Speaker 2: Is there ever a time that it actually may be

460
00:23:15,200 --> 00:23:18,320
Speaker 2: healthier simply to move on rather than to dwell on

461
00:23:18,320 --> 00:23:18,960
Speaker 2: your mistakes.

462
00:23:19,920 --> 00:23:23,080
Speaker 9: I think for some people with some mistakes, if it's

463
00:23:23,119 --> 00:23:25,760
Speaker 9: a minor thing, or if they actually have a pretty

464
00:23:25,760 --> 00:23:28,879
Speaker 9: good understanding of it, then it's easier to do that

465
00:23:28,920 --> 00:23:30,960
Speaker 9: and just move on. But if it's something like the

466
00:23:31,040 --> 00:23:32,520
Speaker 9: kinds of mistakes that are in the book, where it

467
00:23:32,520 --> 00:23:35,879
Speaker 9: really was very meaningful to folks, it really was a

468
00:23:35,920 --> 00:23:39,280
Speaker 9: watershed moment in their lives, I think you can't really

469
00:23:39,280 --> 00:23:41,480
Speaker 9: move on until you really do get an understanding of it,

470
00:23:41,520 --> 00:23:44,639
Speaker 9: and for most folks it takes pausing and unpacking it

471
00:23:44,680 --> 00:23:47,040
Speaker 9: a bit to really get to that level of understanding

472
00:23:47,080 --> 00:23:47,960
Speaker 9: to be able to move on.

473
00:23:50,720 --> 00:23:53,840
Speaker 2: Next we turn to Josh Steiner's mistake, one very different

474
00:23:53,880 --> 00:23:56,600
Speaker 2: from the one Michael Lintman made, and what we can

475
00:23:56,680 --> 00:23:57,720
Speaker 2: all learn from it.

476
00:23:58,160 --> 00:24:00,320
Speaker 8: This isn't like the World Series where people like, oh great,

477
00:24:00,359 --> 00:24:01,399
Speaker 8: I went to the World Series twice.

478
00:24:01,480 --> 00:24:03,119
Speaker 7: Once it's plenty, you don't need to do it twice.

479
00:24:03,119 --> 00:24:03,520
Speaker 7: Trust me.

480
00:24:15,040 --> 00:24:17,479
Speaker 2: All of us make our share of mistakes, but not

481
00:24:17,640 --> 00:24:19,480
Speaker 2: all of us are in the public eye the way

482
00:24:19,480 --> 00:24:22,199
Speaker 2: that Michael Linton was when he ran sony pictures and

483
00:24:22,320 --> 00:24:25,399
Speaker 2: incurred the wrath of the North Korean regime, or the

484
00:24:25,440 --> 00:24:27,639
Speaker 2: way that Josh Steiner was when he was in the

485
00:24:27,680 --> 00:24:31,840
Speaker 2: Clinton Treasury Apartment and got wrapped up in the Whitewater investigation.

486
00:24:33,720 --> 00:24:35,960
Speaker 2: Take us through Europe. Mistake in Washington.

487
00:24:36,080 --> 00:24:37,960
Speaker 8: At the age of twenty seven, I became the chief

488
00:24:38,000 --> 00:24:40,439
Speaker 8: of staff at the Treasury Department in the nineteen nineties.

489
00:24:40,520 --> 00:24:42,960
Speaker 8: The beginning part of the Clinton administration was a little

490
00:24:42,960 --> 00:24:45,439
Speaker 8: bit fraught with scandals, the most notable of which was

491
00:24:45,440 --> 00:24:50,160
Speaker 8: the Whitewater investigation. And like many senior officials, I got subpoenaed.

492
00:24:50,440 --> 00:24:53,240
Speaker 8: I actually turned over all the documents that were relevant,

493
00:24:53,520 --> 00:24:56,360
Speaker 8: one of which, unfortunately, was my personal diary. And in

494
00:24:56,359 --> 00:25:00,160
Speaker 8: that personal diary I had written things about Whitewater. And

495
00:25:00,480 --> 00:25:03,879
Speaker 8: keeping a personal diary in Washington is not necessarily a mistake.

496
00:25:04,480 --> 00:25:08,440
Speaker 8: Writing about sensitive investigations in your diary. That's a mistake,

497
00:25:08,640 --> 00:25:09,800
Speaker 8: and it was a big one.

498
00:25:10,160 --> 00:25:13,119
Speaker 2: So again it's important to if exactly what the mistake,

499
00:25:13,119 --> 00:25:15,320
Speaker 2: and it was not keeping the diary in your view

500
00:25:15,359 --> 00:25:15,840
Speaker 2: looking back.

501
00:25:15,760 --> 00:25:17,159
Speaker 8: At it now, yeah, I was a history major. I

502
00:25:17,160 --> 00:25:19,440
Speaker 8: have a graduate degree in history. You couldn't write history

503
00:25:19,600 --> 00:25:22,119
Speaker 8: if people who had been involved in public policy and

504
00:25:22,160 --> 00:25:23,560
Speaker 8: government didn't keep diaries.

505
00:25:23,600 --> 00:25:24,320
Speaker 7: That's not a mistake.

506
00:25:24,720 --> 00:25:28,280
Speaker 8: But they were experienced enough, wise enough, mature enough to

507
00:25:28,400 --> 00:25:32,000
Speaker 8: know that you're not supposed to write things about investigations

508
00:25:32,040 --> 00:25:36,400
Speaker 8: because there was an independent council involved, and my diary

509
00:25:36,960 --> 00:25:40,879
Speaker 8: include references to sensitive conversations and were still it was

510
00:25:40,920 --> 00:25:45,280
Speaker 8: the worst combination of a personal diary therefore not particularly accurate,

511
00:25:45,520 --> 00:25:47,280
Speaker 8: and about things which are highly sensitive.

512
00:25:47,560 --> 00:25:48,920
Speaker 7: That's a pretty toxic combination.

513
00:25:49,359 --> 00:25:51,080
Speaker 12: I made no effort to check the accuracy of my

514
00:25:51,240 --> 00:25:54,520
Speaker 12: diary because this was never intended to be a precise

515
00:25:54,600 --> 00:25:58,320
Speaker 12: narrative or a verbatim account of what took place. It was,

516
00:25:58,520 --> 00:26:02,159
Speaker 12: more than anything, a way to reflect on events and

517
00:26:02,240 --> 00:26:06,000
Speaker 12: draw lessons from my personal and professional experiences. I wish

518
00:26:06,080 --> 00:26:07,360
Speaker 12: that my diary was more accurate.

519
00:26:07,600 --> 00:26:09,359
Speaker 2: What's your act one look like? What led to you

520
00:26:09,520 --> 00:26:10,120
Speaker 2: that decision?

521
00:26:10,920 --> 00:26:13,520
Speaker 8: One of the things that we discovered about mistakes was

522
00:26:13,960 --> 00:26:16,920
Speaker 8: you really need to understand the context and what you're operating.

523
00:26:17,160 --> 00:26:19,359
Speaker 8: And I had started to keep a diary when I

524
00:26:19,440 --> 00:26:21,440
Speaker 8: was traveling through Asia at the age of twenty three,

525
00:26:21,560 --> 00:26:21,840
Speaker 8: and it.

526
00:26:21,800 --> 00:26:22,720
Speaker 7: Was totally appropriate.

527
00:26:23,000 --> 00:26:26,160
Speaker 8: You're in Bali, you know you're in Malaysia and you're

528
00:26:26,160 --> 00:26:27,159
Speaker 8: writing down your.

529
00:26:27,040 --> 00:26:29,240
Speaker 7: Notes, probably a little bit of terrible poetry.

530
00:26:29,520 --> 00:26:31,919
Speaker 8: You meet someone and you're keeping a recollection of the

531
00:26:31,920 --> 00:26:35,480
Speaker 8: person you met, that's appropriate in that context. I then

532
00:26:35,920 --> 00:26:39,080
Speaker 8: had a series of jobs, ultimately at Treasury. It was

533
00:26:39,119 --> 00:26:41,800
Speaker 8: fine to keep a diary, but it would be better

534
00:26:42,200 --> 00:26:44,560
Speaker 8: if I had kept a diary that was appropriate for Washington,

535
00:26:44,880 --> 00:26:48,760
Speaker 8: not backpacking through Asia. And that contextual question keeps coming

536
00:26:48,840 --> 00:26:52,359
Speaker 8: up over and over again, like know your context, apply

537
00:26:52,480 --> 00:26:56,080
Speaker 8: the right rules and processes and systems, decision making skills

538
00:26:56,080 --> 00:26:57,919
Speaker 8: to the context and what you're operating.

539
00:26:57,760 --> 00:27:01,800
Speaker 2: One of the things I but maybe it was a

540
00:27:01,800 --> 00:27:04,200
Speaker 2: little surprised that it doesn't appear you ever thought about

541
00:27:04,240 --> 00:27:06,520
Speaker 2: just not giving them the diary. Yeah.

542
00:27:07,000 --> 00:27:09,520
Speaker 8: I received a fair amount of criticism at the time

543
00:27:09,920 --> 00:27:12,399
Speaker 8: for being naive enough to think that I needed to

544
00:27:12,440 --> 00:27:15,560
Speaker 8: turn it over. And my view was that the subpoena

545
00:27:15,640 --> 00:27:17,879
Speaker 8: was very clear, and the law is the law, and

546
00:27:18,160 --> 00:27:22,639
Speaker 8: I really really regretted writing what I did in my diary.

547
00:27:22,960 --> 00:27:26,719
Speaker 8: I have no regret about complying with the subpoena.

548
00:27:26,840 --> 00:27:31,000
Speaker 2: So what was the price you paid? Personally or within

549
00:27:31,040 --> 00:27:33,320
Speaker 2: the larger context in the Clinton industry, were still working

550
00:27:33,359 --> 00:27:34,320
Speaker 2: in the Clintons Rasiot.

551
00:27:34,359 --> 00:27:35,000
Speaker 7: Yeah, Firtshaw.

552
00:27:35,080 --> 00:27:38,280
Speaker 8: Secretary Benson was unbelievably gracious to me. I tendered my

553
00:27:38,359 --> 00:27:41,200
Speaker 8: resignation and he said no, he said, no, you're doing.

554
00:27:41,040 --> 00:27:41,520
Speaker 7: A good job.

555
00:27:41,560 --> 00:27:44,240
Speaker 8: This wasn't so awesome. That's a little bit of an understatement.

556
00:27:45,040 --> 00:27:47,080
Speaker 8: And he said, nevertheless, you got to keep going. So

557
00:27:47,160 --> 00:27:50,760
Speaker 8: the price I paid was certainly I lost some credibility

558
00:27:50,960 --> 00:27:53,680
Speaker 8: with my colleagues. Appropriately enough, I had made some bad

559
00:27:53,720 --> 00:27:56,320
Speaker 8: decisions and I think they questioned my judgment over it,

560
00:27:56,359 --> 00:28:00,400
Speaker 8: and that was appropriate. The bigger price was I'd lost

561
00:28:00,400 --> 00:28:03,840
Speaker 8: some self confidence and sense of self and I thought

562
00:28:03,840 --> 00:28:05,879
Speaker 8: of myself as someone who had good judgment, who was

563
00:28:05,920 --> 00:28:08,800
Speaker 8: able to operate at a senior level within the government.

564
00:28:09,320 --> 00:28:13,200
Speaker 8: And I questioned whether this was evidence of the fact

565
00:28:13,200 --> 00:28:15,200
Speaker 8: that I was in fact too young for my job.

566
00:28:15,440 --> 00:28:18,520
Speaker 8: There's no question I carried with me embarrassment and shame

567
00:28:18,760 --> 00:28:19,960
Speaker 8: as a result of what happened.

568
00:28:20,359 --> 00:28:22,199
Speaker 2: Again, if you had the time to reflect on it

569
00:28:22,760 --> 00:28:25,120
Speaker 2: the three acts at the time, would you have done

570
00:28:25,119 --> 00:28:25,840
Speaker 2: anything differently.

571
00:28:26,040 --> 00:28:31,240
Speaker 8: Yes, I think in hindsight, I tried to massage it

572
00:28:31,280 --> 00:28:35,359
Speaker 8: too much and I shouldn't have been as concerned about

573
00:28:35,400 --> 00:28:38,560
Speaker 8: whether it all lined up perfectly, and just should have said, Look,

574
00:28:38,560 --> 00:28:40,040
Speaker 8: I wrote what I wrote. You can interpret it the

575
00:28:40,040 --> 00:28:41,040
Speaker 8: way you want to interpret it.

576
00:28:41,400 --> 00:28:43,880
Speaker 2: There are a number of other chapters in this book

577
00:28:43,920 --> 00:28:46,320
Speaker 2: with different people, some of whom we all know very well,

578
00:28:46,320 --> 00:28:48,719
Speaker 2: some we may not know quite as well. What were

579
00:28:48,720 --> 00:28:51,040
Speaker 2: the ones that either surprised you or stood out for you?

580
00:28:51,120 --> 00:28:54,200
Speaker 6: Michael, Malcolm Gladwell. So, if I were to tell you

581
00:28:54,240 --> 00:28:57,680
Speaker 6: that Malcolm Gladwell considers it to have been a mistake

582
00:28:57,920 --> 00:29:00,560
Speaker 6: that he decided to become a writer, that that was

583
00:29:00,600 --> 00:29:03,680
Speaker 6: the professional path that he chose given his success, I

584
00:29:03,760 --> 00:29:05,000
Speaker 6: dare say you'd be surprised.

585
00:29:05,200 --> 00:29:08,080
Speaker 8: Every person we asked had a mistake that they've been

586
00:29:08,120 --> 00:29:10,680
Speaker 8: carrying with them for a long period of time, that

587
00:29:10,720 --> 00:29:13,640
Speaker 8: they were eager to get off their chest.

588
00:29:13,240 --> 00:29:14,280
Speaker 7: And they were very moving.

589
00:29:14,520 --> 00:29:17,040
Speaker 8: Some of them related to family dynamics, some of them related,

590
00:29:17,240 --> 00:29:21,320
Speaker 8: as Michael said, to career choices, and their willingness to

591
00:29:21,400 --> 00:29:22,480
Speaker 8: talk was very generous.

592
00:29:22,880 --> 00:29:25,959
Speaker 2: Having gone through this process, unpeeled the onion, as you

593
00:29:26,080 --> 00:29:28,800
Speaker 2: describe it, does it make you better at what you

594
00:29:28,920 --> 00:29:29,480
Speaker 2: do today?

595
00:29:30,480 --> 00:29:32,200
Speaker 7: You'd have to ask Michael what he does today. First,

596
00:29:32,480 --> 00:29:33,320
Speaker 7: it's not obvious to me.

597
00:29:33,520 --> 00:29:35,400
Speaker 6: It's not clear to the either. Frankly, so I wouldn't

598
00:29:35,440 --> 00:29:38,560
Speaker 6: answer it that way. Yeah, I think it does. I

599
00:29:38,600 --> 00:29:41,640
Speaker 6: think you know. One of the ideas in the book

600
00:29:42,040 --> 00:29:45,479
Speaker 6: is something called a Cheetah pause, which means that before

601
00:29:45,640 --> 00:29:48,479
Speaker 6: you react to something, you take a breath and you

602
00:29:48,560 --> 00:29:51,960
Speaker 6: actually try and understand what your emotional state is and

603
00:29:52,000 --> 00:29:54,760
Speaker 6: what your real thinking is before you actually commit yourself

604
00:29:54,800 --> 00:29:55,280
Speaker 6: to that action.

605
00:29:55,320 --> 00:29:56,480
Speaker 8: Now, I spent a lot of my career in the

606
00:29:56,480 --> 00:29:58,600
Speaker 8: investing community, and you grew up in the investing community,

607
00:29:58,800 --> 00:30:01,080
Speaker 8: and you always think about the bound between fear and greed,

608
00:30:01,200 --> 00:30:03,680
Speaker 8: which is that you know, you think to yourself, every

609
00:30:03,680 --> 00:30:05,960
Speaker 8: position size is either too big or too small. The

610
00:30:06,000 --> 00:30:08,640
Speaker 8: work that we did on this book helped me understand

611
00:30:09,080 --> 00:30:10,520
Speaker 8: that a lot of things in life are sort of

612
00:30:10,560 --> 00:30:10,840
Speaker 8: like this.

613
00:30:11,280 --> 00:30:12,760
Speaker 7: It's approach avoidance.

614
00:30:12,800 --> 00:30:15,960
Speaker 8: It's both we're really attracted to something, I'm really scared

615
00:30:16,000 --> 00:30:19,719
Speaker 8: about something, and one of the ways to make fewer mistakes.

616
00:30:19,720 --> 00:30:21,480
Speaker 8: And I think one of the things that we discovered

617
00:30:21,800 --> 00:30:24,200
Speaker 8: is a willingness to recognize that both can be true.

618
00:30:24,560 --> 00:30:26,800
Speaker 8: You're attracted to it, you're afraid of it, And how

619
00:30:26,840 --> 00:30:28,960
Speaker 8: do you balance fear and greed. It's not all one

620
00:30:29,040 --> 00:30:30,760
Speaker 8: or the other. It's finding that path.

621
00:30:31,560 --> 00:30:34,440
Speaker 9: There's the making a decision in the moment, right, And

622
00:30:34,480 --> 00:30:37,040
Speaker 9: I think sometimes we get overwhelmed by emotion or we

623
00:30:37,080 --> 00:30:39,760
Speaker 9: get so focused in on the rational decision making that

624
00:30:39,800 --> 00:30:41,680
Speaker 9: we forget to kind of take a step back.

625
00:30:41,920 --> 00:30:46,240
Speaker 2: JOHNS. Hopkins psychology professor Ellison Papadakis says one tried and

626
00:30:46,320 --> 00:30:49,800
Speaker 2: true way to avoid mistakes is taking a pause before

627
00:30:49,880 --> 00:30:50,600
Speaker 2: a plunge.

628
00:30:50,880 --> 00:30:53,960
Speaker 9: So there's a great example in the book with IRV Gotti,

629
00:30:54,000 --> 00:30:56,680
Speaker 9: who is a music producer who really blew up his

630
00:30:56,720 --> 00:31:00,440
Speaker 9: relationship with Ilo by allowing his emotion once it'sua to

631
00:31:00,480 --> 00:31:04,960
Speaker 9: move over into another one. Had he for totally legitimate reasons,

632
00:31:04,960 --> 00:31:07,400
Speaker 9: he had a lot of emotion response to the situation,

633
00:31:08,000 --> 00:31:10,280
Speaker 9: But had he been able to take a moment and

634
00:31:10,320 --> 00:31:12,760
Speaker 9: not answer the phone that then led to this major

635
00:31:12,800 --> 00:31:16,080
Speaker 9: mistake that he made, I think you might have made

636
00:31:16,080 --> 00:31:21,080
Speaker 9: it a different decision in it. And it's that kind

637
00:31:21,120 --> 00:31:24,240
Speaker 9: of allowing yourself the time the space to do it. Now,

638
00:31:24,280 --> 00:31:26,760
Speaker 9: not all decisions allow that, right, But if we can

639
00:31:26,880 --> 00:31:28,920
Speaker 9: do what's called the cheetah pause, right, So cheat is

640
00:31:29,000 --> 00:31:32,240
Speaker 9: run incredibly fast, but they can also decelerate and stop

641
00:31:32,600 --> 00:31:35,200
Speaker 9: very quickly too. So if we can, if we've got

642
00:31:35,480 --> 00:31:38,480
Speaker 9: the cheetah running right or the train going right, We've

643
00:31:38,480 --> 00:31:40,239
Speaker 9: got to make a decision. If we can figure out

644
00:31:40,240 --> 00:31:41,920
Speaker 9: how to make a little pause in there to allow

645
00:31:41,960 --> 00:31:45,840
Speaker 9: ourselves to use our wise minds right to make these

646
00:31:45,920 --> 00:31:49,120
Speaker 9: rational decisions that include both emotion and our rationality, that

647
00:31:49,160 --> 00:31:50,320
Speaker 9: can be very helpful.

648
00:31:50,760 --> 00:31:53,160
Speaker 2: One thing I've had in my mind for a long time,

649
00:31:53,240 --> 00:31:56,120
Speaker 2: which is, if you're not making some mistakes, you're not

650
00:31:56,160 --> 00:31:59,640
Speaker 2: trying enough risky things. But is the real lesson here

651
00:31:59,680 --> 00:32:01,720
Speaker 2: is not a question of taking the risk, it's how

652
00:32:01,760 --> 00:32:02,400
Speaker 2: you take the risk.

653
00:32:03,280 --> 00:32:05,240
Speaker 8: I think our book is less about not taking the

654
00:32:05,320 --> 00:32:07,440
Speaker 8: risk or taking the risk per se. One way to

655
00:32:07,440 --> 00:32:08,960
Speaker 8: think about it to your point is, if you're a

656
00:32:08,960 --> 00:32:11,160
Speaker 8: loan officer and you're so risk at verse you never

657
00:32:11,200 --> 00:32:14,120
Speaker 8: make a loan, you're unlikely to be a successful loan officer,

658
00:32:14,280 --> 00:32:16,920
Speaker 8: And if you approve every loan, you're unlikely to be successful.

659
00:32:17,080 --> 00:32:19,840
Speaker 8: Our book is slightly different, which is loan officers are

660
00:32:19,840 --> 00:32:22,160
Speaker 8: going to make bad loans. Investors are going to make

661
00:32:22,200 --> 00:32:26,800
Speaker 8: bad decisions. If the inclination of that loan officer and

662
00:32:26,840 --> 00:32:29,760
Speaker 8: then investor is to hide that mistake, to not talk

663
00:32:29,760 --> 00:32:32,680
Speaker 8: about the mistake, they're making a whole new mistake, And

664
00:32:32,720 --> 00:32:36,400
Speaker 8: the real premise of our book is acknowledgment that we

665
00:32:36,520 --> 00:32:39,240
Speaker 8: all are going to make mistakes, and that it's a

666
00:32:39,360 --> 00:32:41,680
Speaker 8: natural part of life, and that the way to make

667
00:32:41,720 --> 00:32:44,240
Speaker 8: few of them and to carry less, shame less, guilt

668
00:32:44,400 --> 00:32:46,840
Speaker 8: less regret is just to talk about them.

669
00:32:47,640 --> 00:32:50,720
Speaker 2: This is a lot of work you've gone through with, Alison.

670
00:32:52,200 --> 00:32:56,920
Speaker 2: If it works perfectly, what does the reader take away?

671
00:32:57,000 --> 00:33:00,680
Speaker 2: What if you accomplished, what did you take away? Well,

672
00:33:00,920 --> 00:33:02,080
Speaker 2: I have my own mistake.

673
00:33:02,400 --> 00:33:03,160
Speaker 7: Okay, let's hear it.

674
00:33:03,160 --> 00:33:06,440
Speaker 2: When I was president ABC News, we had Leonard DiCaprio

675
00:33:06,600 --> 00:33:09,080
Speaker 2: front on Earth Day special for us because he was

676
00:33:09,120 --> 00:33:12,560
Speaker 2: the chair of the organization at that time, and I

677
00:33:12,640 --> 00:33:14,560
Speaker 2: was a decision I made on the spur of the moment.

678
00:33:14,920 --> 00:33:18,120
Speaker 2: I was relatively new in the job. I wanted acceptance

679
00:33:18,120 --> 00:33:20,200
Speaker 2: from the journalists. I was trying to do something I

680
00:33:20,200 --> 00:33:24,520
Speaker 2: thought was noble, it was environmental, and my team decided

681
00:33:24,560 --> 00:33:26,160
Speaker 2: to have him go into the White House and interview

682
00:33:26,160 --> 00:33:28,920
Speaker 2: President Clinton, and I got killed. I mean it was brutal,

683
00:33:29,000 --> 00:33:32,400
Speaker 2: and it built up to President Clinton at a big

684
00:33:32,440 --> 00:33:35,280
Speaker 2: black tie dinner with a thousand people in Washington, getting

685
00:33:35,320 --> 00:33:36,760
Speaker 2: up and doing the whole talk about me.

686
00:33:37,320 --> 00:33:39,640
Speaker 13: But I just want to say this to David Weston.

687
00:33:39,680 --> 00:33:43,000
Speaker 13: You know, I've been in a lot of tough spots.

688
00:33:43,120 --> 00:33:46,880
Speaker 13: Don't let this get you down. You may not be

689
00:33:47,000 --> 00:33:48,560
Speaker 13: America's news leader.

690
00:33:49,520 --> 00:33:51,840
Speaker 6: But you're king of the world.

691
00:33:53,280 --> 00:33:55,040
Speaker 7: Have you talked about that on television before?

692
00:33:55,120 --> 00:33:55,640
Speaker 2: No, I've never had this.

693
00:33:56,040 --> 00:33:57,920
Speaker 7: Well, so this is the whole I've talked about it. Okay,

694
00:33:57,960 --> 00:33:58,840
Speaker 7: this is really the hope.

695
00:33:59,040 --> 00:34:00,760
Speaker 8: No, but this is the exactly the hope that someone

696
00:34:00,760 --> 00:34:03,840
Speaker 8: who's been super successful across a whole stage of different careers,

697
00:34:03,880 --> 00:34:07,240
Speaker 8: seriously as a lawyer, as an executive, as someone who's

698
00:34:07,280 --> 00:34:11,000
Speaker 8: done really interesting television, this book hopefully has given you

699
00:34:11,040 --> 00:34:13,360
Speaker 8: permission for the first time to talk about something publicly

700
00:34:13,520 --> 00:34:15,520
Speaker 8: which had stayed with you for a long time. And

701
00:34:15,960 --> 00:34:18,960
Speaker 8: that's our aspiration that more people have that sense that

702
00:34:19,040 --> 00:34:21,520
Speaker 8: it's okay that you don't just have to talk about

703
00:34:21,520 --> 00:34:24,120
Speaker 8: this success. You don't have to suppress the mistake, that

704
00:34:24,160 --> 00:34:25,200
Speaker 8: it's okay to go public.

705
00:34:25,440 --> 00:34:27,880
Speaker 6: I don't think what people should take away from this

706
00:34:28,080 --> 00:34:30,239
Speaker 6: is by reading this book, you're never going to make

707
00:34:30,280 --> 00:34:34,000
Speaker 6: another mistakes. That is naive, and that's actually not what

708
00:34:34,040 --> 00:34:37,280
Speaker 6: we're hoping for. Will you reduce the number of mistakes

709
00:34:37,320 --> 00:34:40,960
Speaker 6: you make maybe hopefully, will you understand better why you

710
00:34:41,040 --> 00:34:44,960
Speaker 6: made those mistakes and perhaps over time make fewer. Probably,

711
00:34:45,040 --> 00:34:49,120
Speaker 6: in fact, I think most likely and equally importantly, and

712
00:34:49,120 --> 00:34:52,880
Speaker 6: this is the big fact that after you've made that mistake,

713
00:34:53,320 --> 00:34:55,600
Speaker 6: and by examining that mistake, you can get rid of

714
00:34:55,600 --> 00:34:58,800
Speaker 6: the shame. You don't have to live with that burden

715
00:34:58,920 --> 00:35:00,600
Speaker 6: the way that I lived with it, the way that

716
00:35:00,680 --> 00:35:02,560
Speaker 6: Josh lived with it, the way that lots of people

717
00:35:02,600 --> 00:35:06,360
Speaker 6: live with it all the time. By actually trying to

718
00:35:06,400 --> 00:35:09,560
Speaker 6: examine why you did it, to understand what your emotional

719
00:35:09,600 --> 00:35:12,200
Speaker 6: state was, you can live with yourself in a better way.

720
00:35:12,520 --> 00:35:16,200
Speaker 6: And that to me would be one hundred percent success.

721
00:35:17,960 --> 00:35:21,480
Speaker 2: Up next, getting the cost of housing down, We travel

722
00:35:21,520 --> 00:35:24,440
Speaker 2: to Sweden to see how manufacturing your house rather than

723
00:35:24,440 --> 00:35:39,360
Speaker 2: building it may be part of the answer. Home ownership

724
00:35:39,400 --> 00:35:41,760
Speaker 2: has long been a key part of the American dream,

725
00:35:42,000 --> 00:35:44,560
Speaker 2: but today it's further out of reach than it's been

726
00:35:44,640 --> 00:35:49,200
Speaker 2: in decades. Our new contributor, Christiaan Freeland, former Finance Minister

727
00:35:49,280 --> 00:35:52,600
Speaker 2: and Deputy Prime Minister of Canada, has first hand experience

728
00:35:52,640 --> 00:35:55,040
Speaker 2: with this from her time in government or her party

729
00:35:55,120 --> 00:35:58,880
Speaker 2: promised to expand prefab housing. She travels to Sweden to

730
00:35:58,920 --> 00:36:01,440
Speaker 2: take a closer look at how homes are built and

731
00:36:01,520 --> 00:36:05,520
Speaker 2: how rethinking that process could mean less expensive houses rather

732
00:36:05,560 --> 00:36:13,480
Speaker 2: than helping people pay higher and higher prices.

733
00:36:14,400 --> 00:36:17,520
Speaker 11: In the far north of Sweden, the marvels of modern

734
00:36:17,560 --> 00:36:22,680
Speaker 11: manufacturing are on full display. This looks more like a

735
00:36:22,840 --> 00:36:26,880
Speaker 11: factory than a housing site.

736
00:36:27,200 --> 00:36:30,440
Speaker 14: I hope so otherwise we would have been failing.

737
00:36:30,520 --> 00:36:34,600
Speaker 11: Here at Lympics five hundred miles north of Stockholm. Houses

738
00:36:34,640 --> 00:36:37,879
Speaker 11: aren't built piece by piece. They roll off an assembly line.

739
00:36:38,600 --> 00:36:42,480
Speaker 11: The company produces roughly forty units a week, a rarity

740
00:36:42,520 --> 00:36:46,160
Speaker 11: in an industry known for drawn out timelines. In Sweden,

741
00:36:46,320 --> 00:36:49,480
Speaker 11: nearly half of single family homes and about twenty percent

742
00:36:49,520 --> 00:36:53,920
Speaker 11: of all residential buildings are built this way. International visitors,

743
00:36:54,280 --> 00:36:56,880
Speaker 11: when they come to talk to you, what do they

744
00:36:56,920 --> 00:36:58,280
Speaker 11: say about their own situation?

745
00:36:58,480 --> 00:36:59,399
Speaker 7: What brings them here?

746
00:36:59,520 --> 00:37:04,840
Speaker 14: The price is too high, it's to costly to buy home,

747
00:37:04,960 --> 00:37:08,040
Speaker 14: to to rent and apartments, and they come to us

748
00:37:08,080 --> 00:37:11,400
Speaker 14: to see if our way of doing it is the

749
00:37:11,440 --> 00:37:14,919
Speaker 14: solution or part of the solution housing affordability.

750
00:37:15,200 --> 00:37:18,120
Speaker 11: It's a growing concern that unites Americans on both sides

751
00:37:18,160 --> 00:37:18,600
Speaker 11: of the Aisle.

752
00:37:18,760 --> 00:37:21,800
Speaker 3: America will not become a nation of renters.

753
00:37:21,800 --> 00:37:22,759
Speaker 7: We're not going to do that.

754
00:37:23,080 --> 00:37:26,960
Speaker 15: You don't have to be in commress to understand how

755
00:37:27,160 --> 00:37:30,399
Speaker 15: badly we need to bring down the cost of.

756
00:37:30,360 --> 00:37:32,880
Speaker 11: Housing and people on both sides of the Atlantic.

757
00:37:33,160 --> 00:37:37,160
Speaker 5: This is more than a housing crisis, this is a

758
00:37:37,200 --> 00:37:38,560
Speaker 5: social crisis.

759
00:37:39,320 --> 00:37:42,560
Speaker 11: Apollo's Housing Affordability Index shows that buying a home in

760
00:37:42,600 --> 00:37:45,600
Speaker 11: the United States hasn't been this difficult since the nineteen eighties.

761
00:37:46,200 --> 00:37:49,400
Speaker 11: Over the past decade alone, home prices have doubled, and

762
00:37:49,440 --> 00:37:52,799
Speaker 11: those who can afford to buy are significantly older. In

763
00:37:52,880 --> 00:37:56,080
Speaker 11: twenty ten, the median age of all US home buyers

764
00:37:56,239 --> 00:38:00,719
Speaker 11: was thirty nine. Today it's fifty nine. Age of a

765
00:38:00,760 --> 00:38:04,239
Speaker 11: first time home buyer has also climbed to forty. It's

766
00:38:04,280 --> 00:38:06,960
Speaker 11: a dynamic that they at the Karanchi, chief economist a

767
00:38:07,040 --> 00:38:10,040
Speaker 11: TD Bank Group, has spent much of her career analyze

768
00:38:10,800 --> 00:38:16,160
Speaker 11: housing a huge preoccupation. How important is it.

769
00:38:16,160 --> 00:38:18,440
Speaker 15: It's important on a couple of levels. It's a large

770
00:38:18,520 --> 00:38:21,120
Speaker 15: share of the economy in terms of workers, it employees

771
00:38:21,120 --> 00:38:24,200
Speaker 15: in terms of output, so it's a large contributor. And

772
00:38:24,239 --> 00:38:26,879
Speaker 15: then it's important because it's probably the most important thing

773
00:38:26,880 --> 00:38:31,120
Speaker 15: people think about when they think about affordability, lifestyle ability,

774
00:38:31,160 --> 00:38:33,759
Speaker 15: to pay for rent or home ownership. So I know

775
00:38:33,840 --> 00:38:36,200
Speaker 15: what myself. When I'm out speaking with our clients, I

776
00:38:36,239 --> 00:38:38,399
Speaker 15: think it's like the second or third question that comes

777
00:38:38,480 --> 00:38:40,640
Speaker 15: up is about whether their children will be able to

778
00:38:40,719 --> 00:38:42,839
Speaker 15: afford a home and what that looks like.

779
00:38:44,080 --> 00:38:46,920
Speaker 11: When it comes to housing affordability, the issue comes down

780
00:38:47,000 --> 00:38:51,200
Speaker 11: to a familiar equation supply versus demand, purchasing power on

781
00:38:51,200 --> 00:38:54,320
Speaker 11: one side, production constraints on the other. You have pointed

782
00:38:54,400 --> 00:38:59,719
Speaker 11: to astonishing lack of productivity in the construction sector. What's

783
00:38:59,760 --> 00:39:00,560
Speaker 11: going on there?

784
00:39:01,200 --> 00:39:05,319
Speaker 15: Yeah, it's beyond lack of productivity, it's regressing. It's what

785
00:39:05,360 --> 00:39:10,080
Speaker 15: we find is it's contracting. So to build a home,

786
00:39:10,160 --> 00:39:12,920
Speaker 15: it actually takes more resources today than it would have

787
00:39:13,000 --> 00:39:16,800
Speaker 15: taken ten years ago, and so that's the disturbing aspect.

788
00:39:16,960 --> 00:39:20,680
Speaker 15: Some of that is being related to the regulatory environment,

789
00:39:20,880 --> 00:39:23,560
Speaker 15: the difference in standards and fees and permitting, so there's

790
00:39:23,600 --> 00:39:26,359
Speaker 15: definitely a factor there. Then the other factors that are

791
00:39:26,360 --> 00:39:29,960
Speaker 15: being attributed to is in the residential sector, it's largely

792
00:39:30,040 --> 00:39:34,840
Speaker 15: a small company game, which means they often have fifty

793
00:39:34,880 --> 00:39:37,960
Speaker 15: employees or less, and from that perspective, they're going to

794
00:39:37,960 --> 00:39:40,719
Speaker 15: be slower to adopt innovation, and there's a very high

795
00:39:40,800 --> 00:39:44,520
Speaker 15: reliance on doing things the same old way manual processes.

796
00:39:45,719 --> 00:39:48,200
Speaker 11: One innovation that could help break that pattern is what

797
00:39:48,280 --> 00:39:52,160
Speaker 11: Linbex is doing in Sweden, building homes in factories instead

798
00:39:52,200 --> 00:39:55,560
Speaker 11: of on site. And while modular housing production does exist

799
00:39:55,560 --> 00:39:58,240
Speaker 11: in the United States, it still makes up only about

800
00:39:58,320 --> 00:40:01,600
Speaker 11: three percent of new single family home construction. So to

801
00:40:01,640 --> 00:40:05,640
Speaker 11: what extent is modular housing prefab housing a solution to

802
00:40:05,800 --> 00:40:07,920
Speaker 11: productivity challenges in the housing sector.

803
00:40:08,000 --> 00:40:11,200
Speaker 15: Yeah, it's been cited as having some clear advantages and

804
00:40:11,280 --> 00:40:16,440
Speaker 15: potentially lowering the cost of housing by twenty to thirty percent.

805
00:40:18,440 --> 00:40:22,520
Speaker 11: That productivity advantage shows up most clearly in multi family housing.

806
00:40:22,920 --> 00:40:24,000
Speaker 11: Lindbex specialty.

807
00:40:24,360 --> 00:40:27,320
Speaker 14: It's pretty much like if you go to automotive industry,

808
00:40:27,600 --> 00:40:31,600
Speaker 14: you see machinery, you see people, you see processes, and

809
00:40:31,640 --> 00:40:34,680
Speaker 14: you see computers and robotics and material and so on.

810
00:40:34,880 --> 00:40:39,720
Speaker 14: So we produce housing very like other organization produces cars.

811
00:40:39,840 --> 00:40:44,319
Speaker 14: We do it indoors year around eight hours per day.

812
00:40:44,719 --> 00:40:47,839
Speaker 11: If I'm a potential client of yours, what are the

813
00:40:47,880 --> 00:40:51,719
Speaker 11: financial benefits of buying a home from you rather than

814
00:40:51,719 --> 00:40:53,960
Speaker 11: having someone build my building on site.

815
00:40:54,080 --> 00:40:57,719
Speaker 14: The first thing is cost for money with our process,

816
00:40:57,880 --> 00:41:01,760
Speaker 14: you pay very late in the process, so the interest

817
00:41:01,880 --> 00:41:05,040
Speaker 14: cost is lower. Traditional ability to pay for the foundation,

818
00:41:05,120 --> 00:41:08,120
Speaker 14: you pay for the structure, to pay for the roof,

819
00:41:08,120 --> 00:41:10,920
Speaker 14: and blah blah blah. So you end up with having

820
00:41:11,040 --> 00:41:15,560
Speaker 14: quite high cost for the interest and you pay very late.

821
00:41:15,600 --> 00:41:18,600
Speaker 14: With our method. The second thing is the engagement as

822
00:41:18,600 --> 00:41:22,080
Speaker 14: a customer in the process. You don't need to supervise

823
00:41:22,520 --> 00:41:26,040
Speaker 14: a car manufacturing. You don't need to supervise housing done

824
00:41:26,080 --> 00:41:26,800
Speaker 14: in a factory.

825
00:41:26,960 --> 00:41:29,840
Speaker 11: For all the cost advantages that come with manufactured housing,

826
00:41:30,200 --> 00:41:34,040
Speaker 11: it has also met with resistance, something I myself encountered

827
00:41:34,040 --> 00:41:36,800
Speaker 11: when advocating for its use while serving in the Canadian government.

828
00:41:37,200 --> 00:41:40,680
Speaker 11: One of the policies the Prime Minister campaigned on was

829
00:41:40,760 --> 00:41:45,120
Speaker 11: building modular housing. That is a way to get more

830
00:41:45,320 --> 00:41:49,719
Speaker 11: homes built faster. I've had people heckling me in the

831
00:41:49,719 --> 00:41:52,160
Speaker 11: House of Commons in Canada saying, oh, you want everyone

832
00:41:52,160 --> 00:41:54,200
Speaker 11: to live in a trailer park. Is there sort of

833
00:41:54,200 --> 00:41:56,840
Speaker 11: a stigma about prefab housing?

834
00:41:57,040 --> 00:42:00,279
Speaker 15: I think so. And there's like some factors like, you know,

835
00:42:00,360 --> 00:42:03,839
Speaker 15: prefab you need wood frames for example, and so some

836
00:42:03,880 --> 00:42:06,879
Speaker 15: people would be, oh, the quality of the construction isn't

837
00:42:06,920 --> 00:42:09,040
Speaker 15: as good, or you know, I want to put my

838
00:42:09,040 --> 00:42:12,440
Speaker 15: personal stamp on it, which you can in prefab, especially

839
00:42:12,480 --> 00:42:14,920
Speaker 15: with three D printing and other factors. In terms of technology,

840
00:42:14,960 --> 00:42:18,160
Speaker 15: it's not like it was ten fifteen years ago. So

841
00:42:18,280 --> 00:42:21,719
Speaker 15: part of it is the stigma, and part of it

842
00:42:21,760 --> 00:42:25,319
Speaker 15: is making sure you have the right skills to do this,

843
00:42:25,520 --> 00:42:27,600
Speaker 15: right to make these design changes, and to do it

844
00:42:27,640 --> 00:42:30,440
Speaker 15: in an economical way so that people don't feel like

845
00:42:30,480 --> 00:42:34,840
Speaker 15: it's all a cookie cutter factor coming through, right, so

846
00:42:35,719 --> 00:42:39,840
Speaker 15: you know, it's breaking through that mentality of what prefab meant.

847
00:42:40,280 --> 00:42:42,640
Speaker 11: It's not just buyer resistance that can be a challenge

848
00:42:42,640 --> 00:42:46,080
Speaker 11: for manufactured housing. It's also the need for steady demand

849
00:42:46,160 --> 00:42:48,440
Speaker 11: in an industry that is notoriously cyclical.

850
00:42:48,680 --> 00:42:52,000
Speaker 14: We try to maneuver to have a backlog that is

851
00:42:52,040 --> 00:42:55,040
Speaker 14: about one year. We can be one year ahead of

852
00:42:55,120 --> 00:42:58,600
Speaker 14: what's happening, and one year is for us, it's a

853
00:42:58,680 --> 00:43:02,120
Speaker 14: good time to have the that long. But you need

854
00:43:02,160 --> 00:43:05,920
Speaker 14: to take in consideration customers who have to wait for

855
00:43:05,960 --> 00:43:09,160
Speaker 14: one year before we can hand over the next project.

856
00:43:09,200 --> 00:43:11,399
Speaker 14: And if we see in market going down, we need

857
00:43:11,440 --> 00:43:15,080
Speaker 14: to address other kind of products so we can fill

858
00:43:15,719 --> 00:43:17,880
Speaker 14: the production flow with products.

859
00:43:18,840 --> 00:43:22,240
Speaker 11: And then there's the issue of regulation something not unique

860
00:43:22,280 --> 00:43:25,000
Speaker 11: to North America when it comes to home building. Elizabeth

861
00:43:25,040 --> 00:43:29,919
Speaker 11: Santisson is Finance Minister of Sweden. Everywhere you go in

862
00:43:30,160 --> 00:43:34,840
Speaker 11: certainly in the western industrialized world, housing, especially the ability

863
00:43:34,840 --> 00:43:37,760
Speaker 11: of young people to afford a home, is a pressing

864
00:43:37,840 --> 00:43:40,160
Speaker 11: political issue. It's something you and I talked about as

865
00:43:40,200 --> 00:43:44,160
Speaker 11: finance ministers. How big an issue is it here in Sweden?

866
00:43:44,600 --> 00:43:47,640
Speaker 16: It's a big issue, especially in Beigause. It is many

867
00:43:47,680 --> 00:43:50,520
Speaker 16: young people feel they don't really can afford to move

868
00:43:50,640 --> 00:43:53,560
Speaker 16: quite early, but it's difficult to afford it because the

869
00:43:53,640 --> 00:43:58,400
Speaker 16: prices have risen so much. One of the largest problems

870
00:43:58,600 --> 00:44:03,280
Speaker 16: in the housing market is it is overregulated. So rules added,

871
00:44:03,400 --> 00:44:06,120
Speaker 16: rules added new rules all the time, and that makes

872
00:44:06,160 --> 00:44:08,680
Speaker 16: it difficult and very expensive to build.

873
00:44:08,800 --> 00:44:10,319
Speaker 11: Tell me a little bit about what you've done on

874
00:44:10,360 --> 00:44:11,360
Speaker 11: cutting red tape.

875
00:44:11,560 --> 00:44:15,840
Speaker 16: Many rules have been added and probably good purpose for

876
00:44:15,840 --> 00:44:18,840
Speaker 16: every rule, but all the rules makes it very expensive

877
00:44:19,120 --> 00:44:22,680
Speaker 16: to build. So that's why we are really trying to do.

878
00:44:22,880 --> 00:44:25,320
Speaker 16: Like now, you can build like a Swedish house, a

879
00:44:25,400 --> 00:44:28,560
Speaker 16: small house and it's not so regulated at all. It's small,

880
00:44:28,640 --> 00:44:31,280
Speaker 16: but you can leave one or two in the house

881
00:44:31,760 --> 00:44:33,399
Speaker 16: so you can come in, so you could have your.

882
00:44:33,320 --> 00:44:36,279
Speaker 11: Own home, and governments aren't alone and grappling with how

883
00:44:36,320 --> 00:44:39,439
Speaker 11: to build more and build faster. Wall Street is too.

884
00:44:39,680 --> 00:44:43,000
Speaker 11: It's increasingly seeing affordable housing as both a need and

885
00:44:43,200 --> 00:44:44,000
Speaker 11: an opportunity.

886
00:44:44,200 --> 00:44:47,160
Speaker 17: JP Morgan plays a really big role in affordable housing.

887
00:44:47,360 --> 00:44:49,799
Speaker 17: It is part of our mission. Just to give you

888
00:44:49,800 --> 00:44:52,759
Speaker 17: some statistics, I think in twenty twenty five we lent

889
00:44:52,880 --> 00:44:58,040
Speaker 17: and invested ten billion towards the new construction or preservation

890
00:44:58,280 --> 00:45:00,520
Speaker 17: of about sixty thousand units wide.

891
00:45:00,680 --> 00:45:05,080
Speaker 11: Charm Sabon leads Community Development Banking at JP Morgan, overseeing

892
00:45:05,080 --> 00:45:10,120
Speaker 11: investments aimed at scaling affordable housing solutions and increasingly that

893
00:45:10,200 --> 00:45:11,600
Speaker 11: includes modular construction.

894
00:45:12,160 --> 00:45:15,960
Speaker 17: Time is money when it comes to construction. It costs

895
00:45:16,160 --> 00:45:19,640
Speaker 17: money to build, it costs money to carry alone, and

896
00:45:19,680 --> 00:45:22,560
Speaker 17: if there's ways to make it shorter, you're going to

897
00:45:22,640 --> 00:45:25,399
Speaker 17: save money. And when something is cheaper to build, it's

898
00:45:25,440 --> 00:45:27,520
Speaker 17: going to be more affordable for the person that is

899
00:45:27,840 --> 00:45:30,200
Speaker 17: ultimately renting or going to own the building. I mean

900
00:45:30,239 --> 00:45:33,720
Speaker 17: with modular housing, for example, units are built in weeks,

901
00:45:34,239 --> 00:45:36,879
Speaker 17: they're put online in months. I think when you're doing

902
00:45:36,920 --> 00:45:39,920
Speaker 17: ground up bricks and mortar, it takes months or years

903
00:45:39,960 --> 00:45:42,319
Speaker 17: to get a building online, depending on where you are.

904
00:45:42,400 --> 00:45:45,640
Speaker 11: But the cost of building for manufacturing housing is only

905
00:45:45,719 --> 00:45:48,239
Speaker 11: one part of what goes into making a home affordable

906
00:45:48,760 --> 00:45:48,960
Speaker 11: or not.

907
00:45:49,480 --> 00:45:53,000
Speaker 17: They're all linked. The cost is one piece, The interest

908
00:45:53,080 --> 00:45:57,360
Speaker 17: rates are one piece. The regulations, the local zoning codes,

909
00:45:57,400 --> 00:46:00,680
Speaker 17: if you're allowed to build multifamily here versus just family.

910
00:46:01,480 --> 00:46:05,000
Speaker 17: All of that leads to the constraints. I think what

911
00:46:05,160 --> 00:46:07,520
Speaker 17: is great right now is that there is a lot

912
00:46:07,600 --> 00:46:10,160
Speaker 17: more focus on this at the federal level and at

913
00:46:10,160 --> 00:46:13,080
Speaker 17: the state level. I know they're looking more closely at

914
00:46:13,080 --> 00:46:15,640
Speaker 17: how to ease some of those supply constraints and look

915
00:46:15,680 --> 00:46:19,319
Speaker 17: at more streamlining of building, creating a national building code,

916
00:46:19,360 --> 00:46:22,680
Speaker 17: building a cold for modular housing to help chip away

917
00:46:22,719 --> 00:46:25,560
Speaker 17: again at some of these challenges that make it harder

918
00:46:25,560 --> 00:46:26,680
Speaker 17: to bring in its online.

919
00:46:27,040 --> 00:46:31,120
Speaker 11: Modular construction could reshape parts of the industry, but even

920
00:46:31,160 --> 00:46:34,480
Speaker 11: its most vocal advocates caution against viewing it as a

921
00:46:34,520 --> 00:46:38,240
Speaker 11: silver bullet. Ten years from now, twenty years from now,

922
00:46:38,680 --> 00:46:41,880
Speaker 11: do you think most homes are going to be built

923
00:46:41,880 --> 00:46:42,560
Speaker 11: in factories?

924
00:46:42,840 --> 00:46:42,920
Speaker 15: No?

925
00:46:44,120 --> 00:46:44,680
Speaker 11: Should they be?

926
00:46:45,719 --> 00:46:51,279
Speaker 14: No? I don't think so. Maybe fifty to go one

927
00:46:51,360 --> 00:46:56,080
Speaker 14: hundred percent, I think we would lose so much of

928
00:46:56,360 --> 00:47:01,000
Speaker 14: the building organization skills, and I think we need to

929
00:47:01,080 --> 00:47:06,440
Speaker 14: see in different products, different way of producing things. We

930
00:47:06,480 --> 00:47:10,759
Speaker 14: need the challenge to be better. If everybody would do

931
00:47:10,800 --> 00:47:13,160
Speaker 14: the same, where would the challenge be done.

932
00:47:13,960 --> 00:47:17,719
Speaker 11: Modular construction may never fully replace building houses one at

933
00:47:17,719 --> 00:47:22,160
Speaker 11: a time on site traditional building, but few major industries

934
00:47:22,200 --> 00:47:26,759
Speaker 11: have changed so little over the past half century. While manufacturing, logistics,

935
00:47:27,000 --> 00:47:31,279
Speaker 11: even farming have reaped enormous productivity gains from automation and technology,

936
00:47:31,560 --> 00:47:35,279
Speaker 11: home building largely hasn't. In a moment defined by shortages

937
00:47:35,320 --> 00:47:38,000
Speaker 11: and a lack of affordability, the debate may be less

938
00:47:38,000 --> 00:47:40,960
Speaker 11: about finding a perfect solution and more about whether an

939
00:47:41,000 --> 00:47:44,560
Speaker 11: industry under this much pressure can afford to keep building

940
00:47:44,719 --> 00:47:45,720
Speaker 11: the way it always has.

941
00:47:47,520 --> 00:47:49,359
Speaker 2: That does it for us? Here at Wall Street Week,

942
00:47:49,520 --> 00:47:52,680
Speaker 2: I'm David Weston. See you next week for more stories

943
00:47:52,800 --> 00:48:08,520
Speaker 2: of capitalism.