1 00:00:08,560 --> 00:00:12,400 Speaker 1: Welcome, Welcome, Welcome back to the Bob Left Steps podcast. 2 00:00:13,000 --> 00:00:16,800 Speaker 1: My guest today is David Gillis, author of the new 3 00:00:16,840 --> 00:00:20,439 Speaker 1: book The Man Who Broke Capitalism, all about Jack Welch 4 00:00:20,520 --> 00:00:25,360 Speaker 1: and how he ruined the economy and more so. David, 5 00:00:25,360 --> 00:00:28,120 Speaker 1: good to have you on the podcast. Why did you 6 00:00:28,200 --> 00:00:31,520 Speaker 1: decide to write the book. I've been a business reporter 7 00:00:31,640 --> 00:00:35,280 Speaker 1: for more than ten years now, and I'm always looking 8 00:00:35,360 --> 00:00:38,160 Speaker 1: for those big stories that can sort of help explain 9 00:00:38,280 --> 00:00:42,519 Speaker 1: and synthesize how we got here in the world we 10 00:00:42,600 --> 00:00:45,360 Speaker 1: live in. And I'll tell you the details of how 11 00:00:45,400 --> 00:00:48,519 Speaker 1: I arrived on Jack as a subject. But when I 12 00:00:48,680 --> 00:00:51,000 Speaker 1: arrived there, when I really realized, when it sort of 13 00:00:51,040 --> 00:00:53,880 Speaker 1: clicked for me about two years ago, that this was 14 00:00:53,960 --> 00:00:57,280 Speaker 1: an individual. This was a story that was one of 15 00:00:57,280 --> 00:01:02,120 Speaker 1: those meta narratives that Christopher iised some of these big 16 00:01:02,160 --> 00:01:06,000 Speaker 1: transformative forces at work in the economy. It was sort 17 00:01:06,040 --> 00:01:07,880 Speaker 1: of a lay up for me to go after it 18 00:01:07,920 --> 00:01:13,000 Speaker 1: as a real target for the book. Okay, how come 19 00:01:13,080 --> 00:01:16,240 Speaker 1: the rest of the business press missed this for decades? 20 00:01:17,200 --> 00:01:20,480 Speaker 1: Oh man, that's one of the big questions, and I 21 00:01:20,520 --> 00:01:22,840 Speaker 1: tried to address some of that in the book. I 22 00:01:22,880 --> 00:01:25,560 Speaker 1: think it's important to remember that at first, they didn't 23 00:01:25,600 --> 00:01:29,000 Speaker 1: necessarily miss it. In those first couple of years after 24 00:01:29,160 --> 00:01:32,119 Speaker 1: Welch took over in the early nineteen eighties we're now 25 00:01:32,160 --> 00:01:37,039 Speaker 1: talking about, he was dubbed neutron Jack. People saw the 26 00:01:37,160 --> 00:01:41,800 Speaker 1: mass layoffs, people saw the factory closures, and they realized 27 00:01:41,840 --> 00:01:47,319 Speaker 1: that this was a man who was unleashing a destabilizing 28 00:01:47,400 --> 00:01:50,400 Speaker 1: force on the American economy, and they called him out 29 00:01:50,400 --> 00:01:53,760 Speaker 1: for it rightly, and he got very unflattering press on 30 00:01:53,880 --> 00:01:58,200 Speaker 1: sixty Minutes Newsweek dubbed him neutron Jack, and it was 31 00:01:58,240 --> 00:02:01,400 Speaker 1: a pretty rough news cycle for him, if you will. 32 00:02:01,960 --> 00:02:04,840 Speaker 1: But then here's what happened, and we got to acknowledge 33 00:02:04,880 --> 00:02:08,560 Speaker 1: this because it's part of the complex and difficult conversation. 34 00:02:09,120 --> 00:02:11,600 Speaker 1: All of the stuff he did started to work, and 35 00:02:11,680 --> 00:02:18,440 Speaker 1: it all worked in delivering g E record short term profits, 36 00:02:19,080 --> 00:02:23,200 Speaker 1: record short relatively short term and we should have a 37 00:02:23,200 --> 00:02:27,880 Speaker 1: discussion about how we measure time horizons here. But for 38 00:02:27,919 --> 00:02:30,679 Speaker 1: most of his twenty years as CEO of g E, 39 00:02:31,040 --> 00:02:33,520 Speaker 1: the stock kept going up, and as long as the 40 00:02:33,600 --> 00:02:37,160 Speaker 1: stock kept going up, sort of irregardless of the human 41 00:02:37,240 --> 00:02:41,000 Speaker 1: cost on the ground, people were cheering along because that 42 00:02:41,080 --> 00:02:44,440 Speaker 1: was the world that we all had decided, more or less, 43 00:02:44,480 --> 00:02:46,799 Speaker 1: we wanted to live in one in which we were 44 00:02:46,840 --> 00:02:50,119 Speaker 1: going to measure success and the health of the American 45 00:02:50,160 --> 00:02:56,080 Speaker 1: economy by the market capitalization of America's biggest companies. And 46 00:02:56,120 --> 00:02:59,639 Speaker 1: what he did was find a formula towards keep g 47 00:03:00,080 --> 00:03:04,520 Speaker 1: IS stock moving up. It's sort of inexorably for twenty years. 48 00:03:04,840 --> 00:03:08,000 Speaker 1: And so during that time it became very hard for 49 00:03:08,120 --> 00:03:11,040 Speaker 1: the business press to sort of see through and look 50 00:03:11,200 --> 00:03:15,200 Speaker 1: past all that and really evaluate the consequences of what 51 00:03:15,240 --> 00:03:18,320 Speaker 1: was going on. I don't want to say that I'm brilliant, 52 00:03:18,840 --> 00:03:21,680 Speaker 1: but certainly by time we hit the end of the nineties, 53 00:03:21,880 --> 00:03:24,040 Speaker 1: it was clear to me that he was cooking the books. 54 00:03:24,440 --> 00:03:28,440 Speaker 1: I mean cooking the books. Would say there's illegality, I 55 00:03:28,440 --> 00:03:31,960 Speaker 1: want to go that far, that he was manipulating the books, 56 00:03:32,000 --> 00:03:35,320 Speaker 1: but that was not in the business press. There was 57 00:03:35,440 --> 00:03:39,480 Speaker 1: very little of it. And I'm reminded here of the 58 00:03:39,520 --> 00:03:42,880 Speaker 1: financial crisis in two thousand and eight, when everyone said, like, wait, 59 00:03:43,160 --> 00:03:45,520 Speaker 1: these sub prime mortgages were a bad thing after all, 60 00:03:45,600 --> 00:03:48,640 Speaker 1: Like where was the scrutiny right that that, like hyper 61 00:03:49,320 --> 00:03:53,520 Speaker 1: uh financialization and like collaterized that obligations might be a 62 00:03:53,560 --> 00:03:59,000 Speaker 1: problem uh, that there was very little recognition of uh 63 00:03:59,040 --> 00:04:01,360 Speaker 1: of of some of those issues by the business press 64 00:04:01,480 --> 00:04:06,600 Speaker 1: in the immediate months preceding the absolute implosion. And similarly 65 00:04:07,200 --> 00:04:10,720 Speaker 1: that you're absolutely right to say that there was inadequate 66 00:04:10,760 --> 00:04:15,160 Speaker 1: scrutiny of ges earnings. I think in the ES in particular. 67 00:04:15,480 --> 00:04:20,160 Speaker 1: Now things were different. Then, the whole culture of Wall 68 00:04:20,200 --> 00:04:25,039 Speaker 1: Street and corporate America was focused on much less transparency. 69 00:04:25,080 --> 00:04:28,640 Speaker 1: This was before the Sarbanes Oxley Act, before the big 70 00:04:28,680 --> 00:04:32,159 Speaker 1: scandals of the early two thousands, when Enron, World, Calm 71 00:04:32,240 --> 00:04:38,560 Speaker 1: and Tycho collapse, leading to a much greater degree of 72 00:04:39,000 --> 00:04:44,560 Speaker 1: oversight by the federal government. That said, Uh, you're entirely 73 00:04:44,600 --> 00:04:49,520 Speaker 1: correct to say that for something like almost eighty quarters 74 00:04:49,600 --> 00:04:55,599 Speaker 1: in a row, g e meet or beat analysts, expectations 75 00:04:56,080 --> 00:04:58,719 Speaker 1: and anyone. You don't have to be a genius to 76 00:04:58,920 --> 00:05:02,719 Speaker 1: understand that something is going on for that to happen. 77 00:05:02,800 --> 00:05:06,760 Speaker 1: Something fishy is going on for a company to meet 78 00:05:06,880 --> 00:05:09,400 Speaker 1: or beat for eighty quarters in a row, because that 79 00:05:09,480 --> 00:05:12,159 Speaker 1: just doesn't happen, right that that's like against the laws 80 00:05:12,160 --> 00:05:16,000 Speaker 1: of nature. So you talk about the change in regulations, 81 00:05:16,320 --> 00:05:19,920 Speaker 1: this is your beat, and we know we had regulations. 82 00:05:20,120 --> 00:05:25,120 Speaker 1: And then Trump undercut regulations. So to what degree, uh, 83 00:05:25,160 --> 00:05:28,719 Speaker 1: do these corporations have to report now? To what degree 84 00:05:28,720 --> 00:05:34,640 Speaker 1: it is different from the nineties I'm talking about presently? Yeah, 85 00:05:34,720 --> 00:05:39,880 Speaker 1: that I would say, on balance, there is more granular 86 00:05:41,440 --> 00:05:44,720 Speaker 1: level of reporting happening by major corporations today. There is 87 00:05:44,720 --> 00:05:48,600 Speaker 1: certainly more accountability when it comes to the boards, and 88 00:05:48,640 --> 00:05:53,200 Speaker 1: that was a big part of those early regulations. Um. 89 00:05:53,240 --> 00:05:55,760 Speaker 1: If you know, if boards are signing off on truly 90 00:05:55,800 --> 00:05:59,240 Speaker 1: cooked books, it doesn't get easy for for them to 91 00:05:59,440 --> 00:06:03,800 Speaker 1: escape accountability. It's also the case that there are very 92 00:06:04,000 --> 00:06:08,919 Speaker 1: few companies that are employing the same kinds of financial 93 00:06:08,960 --> 00:06:12,320 Speaker 1: shenanigans that g E was up to. And there are 94 00:06:12,400 --> 00:06:17,040 Speaker 1: very few companies that have anything close to UH an 95 00:06:17,160 --> 00:06:21,160 Speaker 1: entity as complex as ge Capital was in the ninet 96 00:06:21,320 --> 00:06:25,880 Speaker 1: nineties and early two thousand's um not to mention something 97 00:06:26,000 --> 00:06:30,200 Speaker 1: like that paired alongside a massive, sprawling industrial business. So 98 00:06:30,240 --> 00:06:34,520 Speaker 1: the comps get a little tricky right now. And it's 99 00:06:34,560 --> 00:06:38,560 Speaker 1: also the case that when companies do engage in some 100 00:06:38,640 --> 00:06:41,800 Speaker 1: of these shenanigans, the SEC has gotten better I think 101 00:06:41,920 --> 00:06:44,400 Speaker 1: at calling them out and dinging them, you know, they 102 00:06:44,480 --> 00:06:47,679 Speaker 1: and they ultimately caught up with in two thousand nine, 103 00:06:48,440 --> 00:06:53,200 Speaker 1: the then CEO, Jeff M. L. Jack, Welch's chosen successor, 104 00:06:53,800 --> 00:06:58,400 Speaker 1: settled these sweeping accounting fraud charges with the SEC that 105 00:06:58,560 --> 00:07:01,320 Speaker 1: mostly covered the period from roughly I think two thousand 106 00:07:01,360 --> 00:07:04,280 Speaker 1: three to two thousand five or so, just after Whils retired. 107 00:07:05,000 --> 00:07:08,400 Speaker 1: But in the settlement and in the news release and 108 00:07:08,440 --> 00:07:11,720 Speaker 1: all the remarks that the SEC made at the time 109 00:07:11,720 --> 00:07:15,080 Speaker 1: of that settlement, they pointed to what sure looked like 110 00:07:15,200 --> 00:07:18,720 Speaker 1: decades of impropriety. And we won't know right because we 111 00:07:18,920 --> 00:07:22,400 Speaker 1: we there isn't the forensic accounting from the eighties and nineties, 112 00:07:22,680 --> 00:07:25,880 Speaker 1: but they made the point that it sure looked like 113 00:07:25,960 --> 00:07:28,360 Speaker 1: GE had been up to this sort of stuff, which 114 00:07:28,360 --> 00:07:31,720 Speaker 1: they ultimately, you know, settled with the SEC for for 115 00:07:31,920 --> 00:07:36,200 Speaker 1: years and years and years. In the newspaper today, there's 116 00:07:36,200 --> 00:07:40,760 Speaker 1: a story about how the institutions, the professionals really didn't 117 00:07:40,760 --> 00:07:44,640 Speaker 1: lose money on crypto. It was the retail investor. Anybody 118 00:07:44,640 --> 00:07:48,040 Speaker 1: who's been exposed to one of these public companies know 119 00:07:48,240 --> 00:07:52,920 Speaker 1: the knows that the CFO plays a huge role. And 120 00:07:53,000 --> 00:07:56,200 Speaker 1: I can give specific examples from my own exposure of 121 00:07:56,280 --> 00:08:00,440 Speaker 1: people who are literally shipping product changing to make the 122 00:08:00,560 --> 00:08:05,520 Speaker 1: numbers look good. Okay, so that whatever they are, there 123 00:08:05,680 --> 00:08:07,920 Speaker 1: is some fudge space. I'm not saying you can take 124 00:08:07,960 --> 00:08:09,760 Speaker 1: a company to lose a hundred million and now makes 125 00:08:09,800 --> 00:08:15,200 Speaker 1: a hundred million. But the public doesn't seem to understand this. 126 00:08:16,040 --> 00:08:19,440 Speaker 1: So to what degree have you encountered this in your reporting? 127 00:08:19,840 --> 00:08:22,520 Speaker 1: Listen on the crypto front, I think what we're seeing 128 00:08:22,600 --> 00:08:25,600 Speaker 1: is the popping of a speculative bubble, and it's very 129 00:08:25,640 --> 00:08:28,560 Speaker 1: hard to know when you know, when people stop buying 130 00:08:28,640 --> 00:08:32,880 Speaker 1: two lips, just how how far the bottom is going 131 00:08:32,960 --> 00:08:36,040 Speaker 1: to fall out from under people. I think the critical 132 00:08:36,120 --> 00:08:39,440 Speaker 1: first point you made is one that is a through 133 00:08:39,480 --> 00:08:42,120 Speaker 1: line of the reporting in this book as well, which 134 00:08:42,200 --> 00:08:46,360 Speaker 1: is that the people in charge rarely face consequences, and 135 00:08:46,360 --> 00:08:50,360 Speaker 1: and that the men, and they're almost always men who 136 00:08:50,440 --> 00:08:52,960 Speaker 1: have the most power in this economy and the most 137 00:08:53,000 --> 00:08:56,360 Speaker 1: money in this economy are usually going to do just fine. 138 00:08:56,840 --> 00:09:00,960 Speaker 1: There is very very little accountability for corporate mouthfeasance in 139 00:09:00,960 --> 00:09:04,520 Speaker 1: this country, and there is a grand tradition in America 140 00:09:04,600 --> 00:09:08,880 Speaker 1: of true impunity, even for the worst offenders and even 141 00:09:08,920 --> 00:09:13,480 Speaker 1: for those who unleashed the most damage on society at large. 142 00:09:13,960 --> 00:09:16,280 Speaker 1: So it doesn't surprise me at all that we're starting 143 00:09:16,280 --> 00:09:20,000 Speaker 1: to see the same patterns play out in crypto and 144 00:09:20,000 --> 00:09:26,400 Speaker 1: and F. T. S Um and my book, frankly is 145 00:09:26,559 --> 00:09:30,400 Speaker 1: a recitation of like hundreds and hundreds examples of how 146 00:09:30,480 --> 00:09:35,960 Speaker 1: Jack Welch and his cronies played the same game at 147 00:09:36,360 --> 00:09:39,920 Speaker 1: major public companies for the better part of four decades. 148 00:09:41,040 --> 00:09:44,959 Speaker 1: Let's go to the present day. So within the last 149 00:09:45,080 --> 00:09:47,760 Speaker 1: six months, stock market has gone down, but let's focus 150 00:09:47,800 --> 00:09:54,320 Speaker 1: on Netflix. Netflix reports essentially a flat quarter, loses seventy 151 00:09:55,080 --> 00:09:59,440 Speaker 1: of the stock value. Let's be very clear, almost all 152 00:09:59,520 --> 00:10:04,560 Speaker 1: of that decline is based on scuttle button analysts, this 153 00:10:04,720 --> 00:10:08,600 Speaker 1: and that, very little to do with the underlying business. 154 00:10:08,640 --> 00:10:13,200 Speaker 1: There might be question the underlying business, but you know, 155 00:10:13,280 --> 00:10:16,120 Speaker 1: a drop of seventy and then of course a lot 156 00:10:16,160 --> 00:10:19,439 Speaker 1: of other things have dropped simultane you know, later than that, etcetera. 157 00:10:19,840 --> 00:10:25,040 Speaker 1: So to what degree is the street disconnected from businesses? 158 00:10:25,400 --> 00:10:28,040 Speaker 1: And as long as they're making money, they don't really 159 00:10:28,240 --> 00:10:32,480 Speaker 1: care what the hell you're doing? Uh? Well, who who 160 00:10:32,559 --> 00:10:34,400 Speaker 1: is the day? And that last part of the question, 161 00:10:34,520 --> 00:10:37,000 Speaker 1: the street or the business? I would say Wall Street 162 00:10:37,080 --> 00:10:42,080 Speaker 1: meaning investors. I'll just make it a general investment community. Yeah, 163 00:10:42,160 --> 00:10:48,400 Speaker 1: I mean, there's this is the subject of many you know, dissertations, Bob. 164 00:10:50,280 --> 00:10:53,679 Speaker 1: I think when we talk about a story like Netflix, right, 165 00:10:53,760 --> 00:10:58,080 Speaker 1: like that stock was obviously inflated because it was one 166 00:10:58,080 --> 00:11:01,200 Speaker 1: of these pandemic stocks. And when the world moved online 167 00:11:01,679 --> 00:11:04,720 Speaker 1: and everyone started spending twelve hours a day on their computers, 168 00:11:05,360 --> 00:11:09,560 Speaker 1: um netfolks, shoure looked like a goodbye. And so, to 169 00:11:09,679 --> 00:11:12,320 Speaker 1: answer one of the parts of that question more directly, like, 170 00:11:12,360 --> 00:11:14,920 Speaker 1: there's of course a huge disconnect between the stock market 171 00:11:15,120 --> 00:11:18,480 Speaker 1: and the fundamentals of any business. Um. You know that 172 00:11:18,600 --> 00:11:22,079 Speaker 1: the stock is sort of a proxy for people's confidence 173 00:11:22,080 --> 00:11:25,319 Speaker 1: in future earnings, Like we know this um in terms 174 00:11:25,400 --> 00:11:29,320 Speaker 1: of the street and what they believe. I think that's it. 175 00:11:29,400 --> 00:11:31,280 Speaker 1: That's a harder question for me to answer. I'm not 176 00:11:31,320 --> 00:11:36,120 Speaker 1: an analyst, and you know, many analysts are gonna pour 177 00:11:36,240 --> 00:11:39,640 Speaker 1: money into companies that are you know, are are going 178 00:11:39,679 --> 00:11:42,280 Speaker 1: to invest heavily in companies that aren't making money. We 179 00:11:42,720 --> 00:11:46,280 Speaker 1: see that all the time with big, unprofitable tech companies. 180 00:11:46,760 --> 00:11:49,640 Speaker 1: And it's also the case conversely that there are plenty 181 00:11:49,720 --> 00:11:56,400 Speaker 1: of companies that have um you know, very respectable, reliable, 182 00:11:56,920 --> 00:12:01,760 Speaker 1: maybe even growing, though perhaps not terribly quickly, profits that 183 00:12:02,040 --> 00:12:06,560 Speaker 1: one could say are are tremendously undervalued. I think to 184 00:12:06,559 --> 00:12:09,920 Speaker 1: to sort of comment on anyone's stock is is difficult, 185 00:12:10,040 --> 00:12:13,160 Speaker 1: especially at the moment we're seeing a major market correction, 186 00:12:13,200 --> 00:12:15,439 Speaker 1: and there's so many other global forces at work from 187 00:12:15,440 --> 00:12:19,720 Speaker 1: the supply chain at Ukraine. Um So I would just 188 00:12:19,800 --> 00:12:25,199 Speaker 1: say that in any few months, sort of reading too 189 00:12:25,280 --> 00:12:29,199 Speaker 1: much into the movement of a particular stock is sort 190 00:12:29,240 --> 00:12:31,920 Speaker 1: of an exercise and potential folly. But if you look 191 00:12:31,960 --> 00:12:34,560 Speaker 1: at the long chart of g E, I think you 192 00:12:34,600 --> 00:12:36,920 Speaker 1: really do see the story that I tell in my 193 00:12:36,960 --> 00:12:40,160 Speaker 1: book played out quite quite viscerally, which is that for 194 00:12:40,240 --> 00:12:44,600 Speaker 1: twenty years Jack Welch essentially used this combination of downsize 195 00:12:44,600 --> 00:12:48,480 Speaker 1: and deal making and financialization to inflate the valuation of 196 00:12:48,600 --> 00:12:52,680 Speaker 1: GEES stock, and that as soon as those games stopped 197 00:12:52,720 --> 00:12:55,840 Speaker 1: working for some combination of reasons that we can get into, 198 00:12:56,240 --> 00:12:58,840 Speaker 1: the stock fell apart and never recovered. And it was 199 00:12:58,880 --> 00:13:01,160 Speaker 1: just last year, of course, at the curren CEO Larry 200 00:13:01,160 --> 00:13:02,680 Speaker 1: Colp said that they were going to split the company 201 00:13:02,760 --> 00:13:07,080 Speaker 1: up forever. Okay, let's go back to the narrative. Paint 202 00:13:07,080 --> 00:13:10,800 Speaker 1: the picture of what's happening with g E and how 203 00:13:10,960 --> 00:13:16,000 Speaker 1: Jack gets the gig and what are the financial conditions, compensation, 204 00:13:16,640 --> 00:13:20,680 Speaker 1: show us what's going on when he comes on as CEO. Yeah. 205 00:13:20,760 --> 00:13:26,319 Speaker 1: Jack took over g E in n and before that. Uh, 206 00:13:26,400 --> 00:13:31,640 Speaker 1: it's really hard to overstate what an integral company General 207 00:13:31,640 --> 00:13:35,680 Speaker 1: Electric was to the American economy. This was the company 208 00:13:35,720 --> 00:13:39,840 Speaker 1: that was founded by Thomas Edison that you know, introduced 209 00:13:39,920 --> 00:13:44,000 Speaker 1: or popularized everything from the radio to the dishwasher, to 210 00:13:44,120 --> 00:13:47,480 Speaker 1: the refrigerator, to the jet engine, to the laser to 211 00:13:47,640 --> 00:13:49,720 Speaker 1: the damn plastic the guys who landed on the moon 212 00:13:49,720 --> 00:13:54,200 Speaker 1: were we're in other visors. Um GE was essentially deeply 213 00:13:54,280 --> 00:13:58,120 Speaker 1: integrated and someone would say synonymous with the American economy 214 00:13:58,240 --> 00:14:02,280 Speaker 1: for all for much of the twenties entry and that 215 00:14:02,400 --> 00:14:06,560 Speaker 1: was the company that he inherited in nineteen. Now for 216 00:14:06,640 --> 00:14:09,000 Speaker 1: those years, for that ten years or so before he 217 00:14:09,040 --> 00:14:12,000 Speaker 1: took over, the stock had mostly been flat. You know, 218 00:14:12,160 --> 00:14:16,240 Speaker 1: the economy as a whole was experiencing stag inflation sort 219 00:14:16,240 --> 00:14:21,920 Speaker 1: of combination of stagnant uh stagnant growth and inflation that 220 00:14:22,120 --> 00:14:26,280 Speaker 1: was making for a really rough run for investors. And 221 00:14:26,320 --> 00:14:29,760 Speaker 1: Welch comes to the job with this real single minded 222 00:14:29,800 --> 00:14:34,360 Speaker 1: focus towards reversing that trend and making g E not 223 00:14:34,440 --> 00:14:40,000 Speaker 1: only engine of profits, but really, in his mind it 224 00:14:40,120 --> 00:14:42,640 Speaker 1: had the potential to be the most valuable company in 225 00:14:42,680 --> 00:14:46,840 Speaker 1: the world, and he set about doing that um But 226 00:14:47,040 --> 00:14:50,600 Speaker 1: the CEO he took over from could not have been 227 00:14:50,640 --> 00:14:53,680 Speaker 1: more different the guy who preceded him, Regg Jones. He 228 00:14:53,760 --> 00:14:58,520 Speaker 1: was this sort of genteel Englishman. He lived quite modestly 229 00:14:58,720 --> 00:15:02,320 Speaker 1: relative to certainly the way Jack would one day run 230 00:15:02,560 --> 00:15:07,120 Speaker 1: run the company. As a CEO, he made you know, 231 00:15:07,960 --> 00:15:10,640 Speaker 1: a respectable sum a million dollars or so, maybe more 232 00:15:10,640 --> 00:15:12,440 Speaker 1: a couple million dollars by the end of his tenure, 233 00:15:12,440 --> 00:15:15,960 Speaker 1: but not tens or hundreds of millions of dollars. And 234 00:15:16,000 --> 00:15:18,920 Speaker 1: so Jack comes in and is about the opposite in 235 00:15:18,960 --> 00:15:25,040 Speaker 1: every way. He is brash, impulsive, He is argumentative, whereas 236 00:15:26,360 --> 00:15:31,240 Speaker 1: Regg Jones had been cerebrill and deliberative and from you know, cordial. 237 00:15:32,360 --> 00:15:39,280 Speaker 1: Welch is completely unafraid to throw tradition out the window. 238 00:15:39,880 --> 00:15:45,360 Speaker 1: Whereas Jones had been very respectful of gees legacy, and 239 00:15:45,960 --> 00:15:51,840 Speaker 1: whereas Regg Jones really focused on making ge UH an 240 00:15:51,840 --> 00:15:54,440 Speaker 1: excellent version of the company it already was when he 241 00:15:54,480 --> 00:15:57,920 Speaker 1: took over in the early seventies or eight sixties, Welch 242 00:15:58,280 --> 00:16:02,240 Speaker 1: comes to the job with almost like an a completely 243 00:16:03,600 --> 00:16:06,560 Speaker 1: um immoral is not the right word. What's the word um? 244 00:16:06,880 --> 00:16:13,640 Speaker 1: With no real allegiance to gees traditional businesses of lighting 245 00:16:14,120 --> 00:16:17,440 Speaker 1: and power systems and transportation. You know, he'll make the 246 00:16:17,440 --> 00:16:19,600 Speaker 1: most of those businesses, but at the end of the day, 247 00:16:19,880 --> 00:16:23,680 Speaker 1: he's much more interested in things like media and finance 248 00:16:23,800 --> 00:16:29,800 Speaker 1: and all sorts of finance UM too, and sees those 249 00:16:30,120 --> 00:16:33,600 Speaker 1: new industries as the real future for General Electric. And 250 00:16:33,640 --> 00:16:37,040 Speaker 1: he identifies all that all everything I just described is 251 00:16:37,120 --> 00:16:39,880 Speaker 1: pretty clear within the first year or so that Welch 252 00:16:39,960 --> 00:16:41,920 Speaker 1: takes over, and then he makes good on it. He 253 00:16:41,960 --> 00:16:45,560 Speaker 1: spent the next twenty years sort of executing on that plan. 254 00:16:46,320 --> 00:16:48,960 Speaker 1: Let's go back a chapter. Who is this guy? You 255 00:16:49,000 --> 00:16:52,760 Speaker 1: read the book and it's reference that he has short 256 00:16:52,840 --> 00:16:57,000 Speaker 1: man syndrome. The other thing is when you work in 257 00:16:57,040 --> 00:17:02,920 Speaker 1: a giant corporation, yes you have to deliver, but relationships 258 00:17:02,920 --> 00:17:06,679 Speaker 1: and getting along but one of the key elements. So 259 00:17:06,760 --> 00:17:09,280 Speaker 1: let's start out with who is this guy and how 260 00:17:09,280 --> 00:17:11,919 Speaker 1: does he end up? G Yeah, we'll tell that to 261 00:17:12,000 --> 00:17:14,040 Speaker 1: Jack Wellips that you need to be nice to your colleagues. 262 00:17:14,280 --> 00:17:17,239 Speaker 1: I think he would have disagreed with you. At the 263 00:17:17,280 --> 00:17:20,800 Speaker 1: top it's a different game. He was. He was an 264 00:17:20,920 --> 00:17:23,000 Speaker 1: argument at of s ob from the get go. All right, 265 00:17:23,040 --> 00:17:25,200 Speaker 1: So who was this guy? Jack Bats was the only 266 00:17:25,320 --> 00:17:28,439 Speaker 1: son of a poor family who grew up in the 267 00:17:28,520 --> 00:17:31,919 Speaker 1: suburbs of Boston. His mom was a homemaker, his father 268 00:17:33,119 --> 00:17:38,960 Speaker 1: was a unionized rail conductor on the local UH commuter 269 00:17:39,000 --> 00:17:48,120 Speaker 1: train system. Welch was as you said, short, uh, muscular, feisty, argumentative. 270 00:17:48,480 --> 00:17:50,399 Speaker 1: He grew up he had a chip on his soldier 271 00:17:50,440 --> 00:17:52,199 Speaker 1: from an early age. He said, I grew up with 272 00:17:52,200 --> 00:17:54,879 Speaker 1: my nose pressed up against the glass. He was poor 273 00:17:55,160 --> 00:17:57,159 Speaker 1: and he knew it, and he did not like it. 274 00:17:58,280 --> 00:18:01,480 Speaker 1: His parents were Irish, hathlic His mother made him an 275 00:18:01,600 --> 00:18:04,600 Speaker 1: ultra boy, but also instilled in him a real competitive street. 276 00:18:04,720 --> 00:18:06,800 Speaker 1: Made him learned how to play poker as a kid 277 00:18:07,040 --> 00:18:10,359 Speaker 1: by using his own allowance money, so right away at 278 00:18:10,400 --> 00:18:13,800 Speaker 1: this visceral sense of winning and losing. Um, he was 279 00:18:13,840 --> 00:18:17,920 Speaker 1: incredibly smart. And I always mentioned that because there's no 280 00:18:18,119 --> 00:18:19,720 Speaker 1: there's no way that he could have done all the 281 00:18:19,800 --> 00:18:27,159 Speaker 1: things he did without having an absolutely, absolutely um you know, 282 00:18:27,600 --> 00:18:31,199 Speaker 1: keen sense not only in strategy and intuition, but he 283 00:18:31,320 --> 00:18:35,040 Speaker 1: was also just you know, brilliant ability to hold and 284 00:18:35,080 --> 00:18:37,920 Speaker 1: synthesize great deals of information. He was smarter than a 285 00:18:37,960 --> 00:18:39,760 Speaker 1: lot of the people he worked with, and he knew it, 286 00:18:40,280 --> 00:18:44,160 Speaker 1: and even early in his career when he hadn't proved anything, uh, 287 00:18:45,119 --> 00:18:48,200 Speaker 1: that pisted him off as well. He went to college 288 00:18:48,280 --> 00:18:50,840 Speaker 1: and then was the youngest person ever to graduate with 289 00:18:50,880 --> 00:18:55,359 Speaker 1: a PhD from University of Champagne in Illinois. Graduated with 290 00:18:55,400 --> 00:18:58,000 Speaker 1: a PhD in chemical engineering I believe it was, and 291 00:18:58,040 --> 00:19:00,600 Speaker 1: his first job was a g e um. First year 292 00:19:00,640 --> 00:19:03,280 Speaker 1: in he threatens to quit because he gets a one 293 00:19:03,320 --> 00:19:06,119 Speaker 1: thou dollar raise, just like the other people in his group, 294 00:19:06,200 --> 00:19:08,600 Speaker 1: but he thinks he deserves more, so he almost he 295 00:19:08,680 --> 00:19:11,920 Speaker 1: threatens to quit. He finally talks his boss's boss into 296 00:19:11,920 --> 00:19:14,200 Speaker 1: giving him a little more money, uh, and he agrees 297 00:19:14,240 --> 00:19:16,399 Speaker 1: to stay. And then it's sort of off to the races. 298 00:19:16,480 --> 00:19:19,679 Speaker 1: They start moving him up pretty swiftly, and he rises 299 00:19:19,680 --> 00:19:23,360 Speaker 1: through the ranks at GE for you know, better part 300 00:19:23,400 --> 00:19:26,520 Speaker 1: of twenty odd years, twenty five years before he's ultimately 301 00:19:26,560 --> 00:19:37,320 Speaker 1: made CEO. Why does he get moved up the ranks 302 00:19:38,080 --> 00:19:42,640 Speaker 1: and it's just despite his edgy personality or somehow does 303 00:19:42,720 --> 00:19:47,920 Speaker 1: that help him? And how does he get chosen at CEO? Yeah? 304 00:19:48,760 --> 00:19:51,320 Speaker 1: It certainly seemed to help him. You know, ge was 305 00:19:51,640 --> 00:19:56,520 Speaker 1: a deferential culture. It was in line with much of 306 00:19:56,560 --> 00:19:59,760 Speaker 1: corporate America where there weren't a lot of very hard 307 00:19:59,840 --> 00:20:03,760 Speaker 1: edge is um. But the fact that he was so 308 00:20:03,880 --> 00:20:07,800 Speaker 1: different and that he was willing to essentially fire people 309 00:20:08,080 --> 00:20:10,600 Speaker 1: to improve the profitability of a group, that he was 310 00:20:10,640 --> 00:20:15,800 Speaker 1: willing to push his executives and his team members to 311 00:20:15,920 --> 00:20:21,120 Speaker 1: go harder, to work faster, to take chances with volatile processes, 312 00:20:21,160 --> 00:20:24,400 Speaker 1: and which in one case resulted in the of blowing 313 00:20:24,480 --> 00:20:27,000 Speaker 1: up of a factory that he was very proud of 314 00:20:27,080 --> 00:20:30,280 Speaker 1: in in his own way, this set him apart. And 315 00:20:30,320 --> 00:20:33,760 Speaker 1: so at that moment, after a decorative stagflation, just just 316 00:20:33,760 --> 00:20:37,160 Speaker 1: just just slow down for one second. Define for those 317 00:20:37,200 --> 00:20:39,480 Speaker 1: who were not as sophisticated and informed as you, what 318 00:20:39,480 --> 00:20:43,200 Speaker 1: do you mean by him blowing up a factory. Yeah, 319 00:20:43,359 --> 00:20:49,359 Speaker 1: this is a relatively well well documented incident. Somewhat earlier 320 00:20:49,400 --> 00:20:55,080 Speaker 1: in his career. He's running a factory in Massachusetts. They're 321 00:20:55,119 --> 00:20:57,600 Speaker 1: trying to come up with a new product. There's a 322 00:20:57,640 --> 00:21:00,960 Speaker 1: real pressure from the folks up to op or down 323 00:21:01,000 --> 00:21:04,520 Speaker 1: in Fairfield as it were, at headquarters, to get this 324 00:21:04,680 --> 00:21:08,119 Speaker 1: right and to make a profitable new plastic A S 325 00:21:08,119 --> 00:21:10,560 Speaker 1: A P and get it to market. They were having 326 00:21:10,560 --> 00:21:15,680 Speaker 1: trouble doing it, but Welch, you know, had his team 327 00:21:15,720 --> 00:21:18,720 Speaker 1: pushing as hard as they possibly could, and in the 328 00:21:18,800 --> 00:21:24,520 Speaker 1: end that meant experimenting with some very highly volatile processes 329 00:21:24,560 --> 00:21:27,560 Speaker 1: and solutions that probably hadn't been fully vetted from a 330 00:21:27,600 --> 00:21:30,840 Speaker 1: safety perspective. And one day he's sitting there in his 331 00:21:31,040 --> 00:21:35,399 Speaker 1: office overlooking Plastics Avenue in Massachusetts and boom, the whole 332 00:21:35,520 --> 00:21:40,400 Speaker 1: plant blows up and there's a massive explosion the building, 333 00:21:40,600 --> 00:21:44,280 Speaker 1: the roof of the building is blown off. Miraculously, no 334 00:21:44,359 --> 00:21:46,800 Speaker 1: one has hurt, no one is seriously injured, no one 335 00:21:46,800 --> 00:21:51,960 Speaker 1: has killed uh. And yet it was sort of one 336 00:21:51,960 --> 00:21:57,240 Speaker 1: of these early anecdotes that that demonstrated just how potentially 337 00:21:57,320 --> 00:22:01,120 Speaker 1: volatile this man was, how how explosive he could be 338 00:22:01,200 --> 00:22:04,600 Speaker 1: as a manager. He's called to Fairfield to headquarters the 339 00:22:04,640 --> 00:22:06,840 Speaker 1: next day as to drive a hundred miles or so 340 00:22:06,880 --> 00:22:10,440 Speaker 1: and explain himself to the to the higher ups at headquarters, 341 00:22:10,480 --> 00:22:13,800 Speaker 1: and essentially they gave him a pass. And that, to me, 342 00:22:13,960 --> 00:22:18,520 Speaker 1: I think, really was one of those moments where he 343 00:22:18,680 --> 00:22:21,640 Speaker 1: suddenly realized that he could get away with it, and 344 00:22:21,720 --> 00:22:26,560 Speaker 1: even if he pushed people. Even if he was taking chances, 345 00:22:26,640 --> 00:22:31,440 Speaker 1: even if he caused some real destruction, there weren't immediate consequences, 346 00:22:31,480 --> 00:22:35,240 Speaker 1: and that I have to believe embolded him. Going forward. 347 00:22:36,200 --> 00:22:39,119 Speaker 1: How do you actually get the Giga CEO? There was 348 00:22:39,119 --> 00:22:44,040 Speaker 1: a process, as there always is. Regg Jones himself requested 349 00:22:44,480 --> 00:22:50,000 Speaker 1: that Jack b included in the in the vetting process, 350 00:22:50,080 --> 00:22:55,720 Speaker 1: and then um, they made they made the the potential 351 00:22:56,000 --> 00:22:59,160 Speaker 1: candidates to succeed Red Shans write a series of memos 352 00:22:59,200 --> 00:23:02,919 Speaker 1: to a series of interviews. Uh. And in one of 353 00:23:02,960 --> 00:23:08,160 Speaker 1: those memos, Welch outlines this vision for a much more aggressive, 354 00:23:08,440 --> 00:23:13,240 Speaker 1: much more competitive, much more ruthless, frankly version of g E, 355 00:23:13,600 --> 00:23:16,679 Speaker 1: one that would compete in a different way in the 356 00:23:16,760 --> 00:23:20,879 Speaker 1: nineteen eighties. And uh, you know Jones and the board 357 00:23:21,040 --> 00:23:23,080 Speaker 1: they bought into that vision, and he got the gig 358 00:23:23,240 --> 00:23:26,040 Speaker 1: and he was he was young, he was a shock candidate. 359 00:23:26,560 --> 00:23:28,600 Speaker 1: And uh, I think I'm quote, I think I'm gonna 360 00:23:28,600 --> 00:23:31,040 Speaker 1: get this quote right when when when it was announced 361 00:23:31,320 --> 00:23:35,280 Speaker 1: the Wall Street Journal said that g E had replaced 362 00:23:35,320 --> 00:23:39,440 Speaker 1: a legend with a live wire. So we know, via 363 00:23:39,560 --> 00:23:44,919 Speaker 1: ge capital and so many other things, that Jack was 364 00:23:45,000 --> 00:23:49,320 Speaker 1: really into financialization. The average person was not aware of 365 00:23:49,440 --> 00:23:54,960 Speaker 1: the extreme depth of financialization on Wall Street until the 366 00:23:55,000 --> 00:23:59,320 Speaker 1: two thousand and eight crash, But even for years before that, 367 00:24:00,119 --> 00:24:03,879 Speaker 1: people had commented that Wall Street no longer build things, 368 00:24:04,240 --> 00:24:08,200 Speaker 1: It was the business of money that was their business. 369 00:24:08,280 --> 00:24:12,720 Speaker 1: To what degree was Jack responsible for that and how 370 00:24:12,720 --> 00:24:18,480 Speaker 1: did he get into that vertical of capital. I would 371 00:24:18,720 --> 00:24:23,960 Speaker 1: hesitate to put the whole transformation of Wall Street on 372 00:24:24,720 --> 00:24:27,000 Speaker 1: Welch's feet. I lay a lot of blame at his 373 00:24:27,080 --> 00:24:29,200 Speaker 1: feet for a lot of different issues. I think Wall 374 00:24:29,240 --> 00:24:31,679 Speaker 1: Street was going to be changing during the nineteen eighties 375 00:24:31,800 --> 00:24:35,800 Speaker 1: almost no matter what. Where I think welch Is influence 376 00:24:36,680 --> 00:24:42,000 Speaker 1: really connected Wall Street with corporate America. Was the degree 377 00:24:42,000 --> 00:24:47,080 Speaker 1: to which he made Ge adopt a lot of the 378 00:24:47,119 --> 00:24:51,560 Speaker 1: worst aspects of banks and other global financial institutions. And 379 00:24:51,600 --> 00:24:55,520 Speaker 1: we then saw many other companies following suit and doing 380 00:24:55,560 --> 00:24:59,920 Speaker 1: some of the same things. In terms of how exact 381 00:25:00,280 --> 00:25:03,240 Speaker 1: he did it, it all started with this little unit 382 00:25:03,240 --> 00:25:06,960 Speaker 1: called GE Capital um. GE had a finance arm for 383 00:25:07,040 --> 00:25:11,440 Speaker 1: decades and decades during the nineteenth century and excuse me, 384 00:25:11,520 --> 00:25:15,120 Speaker 1: during the twentieth century, and it was mainly used as 385 00:25:15,160 --> 00:25:19,600 Speaker 1: a way to help corporations and even individuals finance their 386 00:25:19,640 --> 00:25:23,119 Speaker 1: purchase of ge products and services. If you couldn't pay 387 00:25:23,280 --> 00:25:28,719 Speaker 1: for uh, you know, your refrigerator outright, it was basic 388 00:25:28,840 --> 00:25:31,760 Speaker 1: lending arm. They could they pay, charge a little interest 389 00:25:31,760 --> 00:25:34,720 Speaker 1: and you could pay it in installments. Welch saw the 390 00:25:34,760 --> 00:25:39,399 Speaker 1: potential of taking that arm and turning it into what 391 00:25:39,520 --> 00:25:43,159 Speaker 1: was essentially an unregulated bank and ran with it. And 392 00:25:43,240 --> 00:25:46,240 Speaker 1: he saw it from the get go. He's in one 393 00:25:46,280 --> 00:25:49,040 Speaker 1: of those memos I mentioned that he wrote to Red Jones. 394 00:25:49,359 --> 00:25:53,399 Speaker 1: He said there was no where at the company where 395 00:25:53,680 --> 00:25:56,720 Speaker 1: quantum change, I believe was the phrase he used, was 396 00:25:56,840 --> 00:26:00,399 Speaker 1: needed more than in finance, because he understood in this 397 00:26:00,640 --> 00:26:03,720 Speaker 1: kernel of a little business unit, there was the potential 398 00:26:04,000 --> 00:26:08,120 Speaker 1: to create what would ultimately be a six hundred billion 399 00:26:08,160 --> 00:26:12,919 Speaker 1: dollar pool of capital that stretched from everything from least 400 00:26:13,040 --> 00:26:19,639 Speaker 1: satellites to tie auto loans to commercial real estate debt. Okay, 401 00:26:20,040 --> 00:26:24,560 Speaker 1: so tell my audience how we ended up using the 402 00:26:24,640 --> 00:26:30,560 Speaker 1: capital to ensure that he met his quarterly targets. G 403 00:26:30,840 --> 00:26:35,320 Speaker 1: E by the time he was done, had an army 404 00:26:35,359 --> 00:26:40,400 Speaker 1: of financial analysts and experts who literally at the end 405 00:26:40,400 --> 00:26:44,480 Speaker 1: of every quarter. So you're after report earnings to Wall 406 00:26:44,520 --> 00:26:49,080 Speaker 1: Street on call it March one. By mid February. You've 407 00:26:49,119 --> 00:26:53,320 Speaker 1: got hundreds of not thousands, of people running the numbers 408 00:26:53,440 --> 00:26:56,679 Speaker 1: and saying, we told them we were gonna make I'm 409 00:26:56,680 --> 00:26:59,600 Speaker 1: gonna make it up here million dollars in profit for 410 00:26:59,640 --> 00:27:01,920 Speaker 1: the quarter. It looks like we're going to be coming 411 00:27:01,960 --> 00:27:05,879 Speaker 1: in closer to three eighteen million dollars. We need that 412 00:27:05,920 --> 00:27:10,840 Speaker 1: seven million dollars. Well, then, with such an enormous operation 413 00:27:10,960 --> 00:27:14,919 Speaker 1: like ge capital at your disposal, you've got any number 414 00:27:14,960 --> 00:27:18,600 Speaker 1: of ways to find that extra seven million dollars in profit. 415 00:27:18,960 --> 00:27:22,840 Speaker 1: You could do anything from sell of division or sell 416 00:27:22,880 --> 00:27:27,080 Speaker 1: a portfolio of credit card pones. You could perhaps even 417 00:27:27,880 --> 00:27:31,560 Speaker 1: lay people off and take a tax right off. You know, 418 00:27:31,640 --> 00:27:36,040 Speaker 1: there were absolutely infinite ways that g E found to 419 00:27:36,280 --> 00:27:41,280 Speaker 1: essentially use this enormous financial harm to UH, as you said, 420 00:27:41,320 --> 00:27:44,720 Speaker 1: massage the numbers quarter after quarter. And it was that 421 00:27:44,840 --> 00:27:48,040 Speaker 1: sort of creative accounting, if you will, that allowed g 422 00:27:48,280 --> 00:27:51,800 Speaker 1: E to hit meter beat for eighty quarters some odd 423 00:27:51,840 --> 00:27:56,560 Speaker 1: in a row. Okay, was there any way this could 424 00:27:56,560 --> 00:28:03,440 Speaker 1: have worked? Or was it always a time bone? There 425 00:28:03,480 --> 00:28:06,000 Speaker 1: was always going to be a reckoning at some level, 426 00:28:06,680 --> 00:28:09,840 Speaker 1: because it wasn't just about the degree to which ge 427 00:28:10,000 --> 00:28:14,040 Speaker 1: stock might have been overinflated. Because of the prominence of 428 00:28:14,080 --> 00:28:17,959 Speaker 1: G Capital. The other thing that was happening during the 429 00:28:18,000 --> 00:28:21,960 Speaker 1: eighties and nineties was that g was under investing in 430 00:28:22,040 --> 00:28:28,920 Speaker 1: research and development, They were fundamentally transforming their relationship with 431 00:28:29,400 --> 00:28:35,480 Speaker 1: their employees, they were buying and merging their way into 432 00:28:35,920 --> 00:28:41,120 Speaker 1: dozens of other industries, and so a reckoning was going 433 00:28:41,160 --> 00:28:44,320 Speaker 1: to take place without a doubt. The question that animates me, 434 00:28:44,560 --> 00:28:46,720 Speaker 1: and which you know it's it's a counter factual, so 435 00:28:46,760 --> 00:28:48,840 Speaker 1: we're not going to have a clear answer to is 436 00:28:48,880 --> 00:28:51,920 Speaker 1: what would have happened if somewhere along the way, be 437 00:28:52,080 --> 00:28:55,280 Speaker 1: it the nineties or the early two thous even after 438 00:28:55,360 --> 00:28:58,400 Speaker 1: Jack left and Jeff Emmott had a couple of chances 439 00:28:58,440 --> 00:29:01,040 Speaker 1: to reset the company, It would have happened if there 440 00:29:01,080 --> 00:29:04,960 Speaker 1: was a serious effort made to wind down GE Capital, 441 00:29:05,320 --> 00:29:09,560 Speaker 1: to double down on American manufacturing, to make kick ass 442 00:29:09,600 --> 00:29:13,040 Speaker 1: products and services, and do it in a way that 443 00:29:13,040 --> 00:29:17,560 Speaker 1: would have positioned g E to become the number one manufacturer, 444 00:29:17,600 --> 00:29:21,960 Speaker 1: the number one industrial company for the twenty one century. 445 00:29:23,000 --> 00:29:24,840 Speaker 1: They did it right. They had done it for the 446 00:29:24,880 --> 00:29:29,560 Speaker 1: twentieth century, and there's nothing to say that they couldn't 447 00:29:29,560 --> 00:29:33,560 Speaker 1: have done it for the twenty first century, except they 448 00:29:33,600 --> 00:29:36,480 Speaker 1: chose not to write. They chose to go and buy portfolios, 449 00:29:36,520 --> 00:29:38,920 Speaker 1: some pride mortgages. In two thousand five, they chose to 450 00:29:39,000 --> 00:29:41,680 Speaker 1: under invest in R and D. For the longest time, 451 00:29:42,000 --> 00:29:44,720 Speaker 1: the culture ossified and people and I talked about this 452 00:29:44,760 --> 00:29:46,960 Speaker 1: in the book. You know, people were afraid to take chances. 453 00:29:47,240 --> 00:29:51,479 Speaker 1: There was no willingness to spend and really invest in 454 00:29:51,600 --> 00:29:54,840 Speaker 1: sort of blue sky initiatives that might have positioned g 455 00:29:55,000 --> 00:29:58,480 Speaker 1: E to become a leader and say autonomous vehicles or 456 00:29:58,600 --> 00:30:01,080 Speaker 1: three D printing or any number of other things that 457 00:30:01,120 --> 00:30:03,400 Speaker 1: are gonna be a big part of the economy going forward, 458 00:30:03,720 --> 00:30:06,360 Speaker 1: and that they weren't in yet. But they had the resources, 459 00:30:06,400 --> 00:30:08,000 Speaker 1: and they had the smart They still have tons of 460 00:30:08,040 --> 00:30:10,720 Speaker 1: smart engineers at that company, but they weren't willing to 461 00:30:10,760 --> 00:30:16,600 Speaker 1: do it. Okay, GEE ultimately buys INNBC. Everybody is aware 462 00:30:16,600 --> 00:30:19,600 Speaker 1: of it because David Letterman is making jokes all the time. 463 00:30:20,320 --> 00:30:23,520 Speaker 1: Was this purely an ego play to get into media 464 00:30:23,600 --> 00:30:26,640 Speaker 1: and have that power and rub shoulders with the stars 465 00:30:27,360 --> 00:30:29,600 Speaker 1: or at one point was this scene as a good 466 00:30:29,640 --> 00:30:33,600 Speaker 1: business Well. G E acquired NBC through its acquisition of 467 00:30:33,720 --> 00:30:37,040 Speaker 1: r c A, which was another diversified conglomerate in the 468 00:30:37,080 --> 00:30:41,120 Speaker 1: nineteen eighties, and there's no doubt about it. Ge uh 469 00:30:41,600 --> 00:30:46,280 Speaker 1: debt and Jack, Well, it's definitely liked being a media mogul. Um. 470 00:30:46,360 --> 00:30:49,800 Speaker 1: He relished in his ability to sort of rub shoulders 471 00:30:49,800 --> 00:30:53,280 Speaker 1: with movie stars and even at times, you know, do 472 00:30:53,480 --> 00:30:58,840 Speaker 1: his small part to try and influence coverage of the press. Um. 473 00:30:58,880 --> 00:31:00,800 Speaker 1: But what to the ear of your question, was it 474 00:31:00,880 --> 00:31:04,840 Speaker 1: seen as a good business move? Sure? Right, if we 475 00:31:04,920 --> 00:31:10,040 Speaker 1: accept that Jack Welch's mandate was to make GE the 476 00:31:10,080 --> 00:31:14,240 Speaker 1: biggest company in the world, Um, the acquisition of r 477 00:31:14,320 --> 00:31:17,520 Speaker 1: C a fulfill help fulfill that mandate. You know, he 478 00:31:17,600 --> 00:31:19,440 Speaker 1: also wanted to be number one and number two in 479 00:31:19,440 --> 00:31:21,520 Speaker 1: every industry. And I believe the combination of the r 480 00:31:21,600 --> 00:31:26,800 Speaker 1: C A business with the g E t V set business, uh, 481 00:31:26,840 --> 00:31:29,240 Speaker 1: you know made the g E t V business sort 482 00:31:29,240 --> 00:31:31,200 Speaker 1: of number one or number two in the world. So 483 00:31:32,120 --> 00:31:36,800 Speaker 1: in those sort of rudimentary ways in which he evaluated 484 00:31:36,880 --> 00:31:40,680 Speaker 1: his strategy and focused on trying to figure out how 485 00:31:40,680 --> 00:31:44,040 Speaker 1: to make g E bigger and more profitable at the time, Yeah, 486 00:31:44,080 --> 00:31:46,200 Speaker 1: that was actually a relative I would say that was 487 00:31:46,240 --> 00:31:49,040 Speaker 1: one of the sounder moves. Yeah, it did take them 488 00:31:49,040 --> 00:31:51,440 Speaker 1: into the media business where they hadn't been, but there 489 00:31:51,480 --> 00:31:56,400 Speaker 1: were some underlying fundamental industrial plays as part of that big, 490 00:31:56,440 --> 00:31:59,760 Speaker 1: mega deal in I think it was that that certainly 491 00:31:59,800 --> 00:32:05,520 Speaker 1: made some sense. Okay. Parallel to this story is the 492 00:32:05,880 --> 00:32:09,760 Speaker 1: term or actually two terms of Ronald Reagani is president, 493 00:32:09,840 --> 00:32:13,280 Speaker 1: needless to say, took over from Jimmy Carter after the 494 00:32:13,360 --> 00:32:19,000 Speaker 1: Iran hostage crisis and incredible inflation. But that's when income 495 00:32:19,040 --> 00:32:23,800 Speaker 1: inequality started, That's when corporate taxes started to fall. To 496 00:32:24,040 --> 00:32:32,600 Speaker 1: what degree was Jack Welch ge helped by this Reaganism 497 00:32:32,720 --> 00:32:34,960 Speaker 1: or to what degree are they really separate? Jack would 498 00:32:35,000 --> 00:32:37,760 Speaker 1: have done this no matter what, gotten away with it. Oh, 499 00:32:37,800 --> 00:32:42,320 Speaker 1: I think they are deeply in mesh. These are symbiotic stories, 500 00:32:42,360 --> 00:32:45,600 Speaker 1: and I allude to Reaganism and Reagan several times throughout 501 00:32:45,600 --> 00:32:49,720 Speaker 1: the book because you're absolutely right that it was some 502 00:32:49,920 --> 00:32:56,000 Speaker 1: of the deregulation during the Reagan administration that enabled some 503 00:32:56,120 --> 00:33:01,840 Speaker 1: of gees or most outrageous shenanigans. For example, even that 504 00:33:02,240 --> 00:33:05,520 Speaker 1: um that was it. Even the r c A deal 505 00:33:05,960 --> 00:33:12,240 Speaker 1: I think was enabled by a rough boxing of antitrust 506 00:33:12,240 --> 00:33:15,560 Speaker 1: statutes by the Reagan administration. There was some weird cause 507 00:33:15,600 --> 00:33:19,000 Speaker 1: from earlier in the twenty century that expressly prohibited g 508 00:33:19,240 --> 00:33:22,840 Speaker 1: E and r c A from linking up, but that was, 509 00:33:23,040 --> 00:33:27,440 Speaker 1: you know, very communiently removed just before the deal. And 510 00:33:27,480 --> 00:33:30,280 Speaker 1: then you look at things like stock buy backs, which 511 00:33:30,360 --> 00:33:35,240 Speaker 1: GE and Welch became absolute pioneers in um. For decades, 512 00:33:35,760 --> 00:33:39,239 Speaker 1: stock buybacks had essentially been illegal because it's effectively a 513 00:33:39,240 --> 00:33:43,680 Speaker 1: company manipulated in its own stock price. Under Reagan and 514 00:33:43,880 --> 00:33:49,440 Speaker 1: his you know, absolute army of financial representatives who took 515 00:33:49,480 --> 00:33:55,320 Speaker 1: over major regulatory posts in the government, that statute was 516 00:33:55,640 --> 00:33:58,440 Speaker 1: essentially eliminated, and all of a sudden, it was okay 517 00:33:58,480 --> 00:34:01,640 Speaker 1: for companies to start buying back their own stock. And 518 00:34:02,280 --> 00:34:05,800 Speaker 1: you mentioned inequality and corporate taxes. We can talk about those, 519 00:34:05,840 --> 00:34:08,640 Speaker 1: but it's important to note that another one of those 520 00:34:09,600 --> 00:34:12,839 Speaker 1: trend lines that sort of starts right around the time 521 00:34:12,840 --> 00:34:16,200 Speaker 1: Watch takes over and has continued innobated to today is 522 00:34:16,320 --> 00:34:19,840 Speaker 1: the use of corporate profits for stock buybacks and dividends. 523 00:34:20,160 --> 00:34:24,279 Speaker 1: And and the money used to be going two employees, 524 00:34:24,360 --> 00:34:26,080 Speaker 1: the money used to be going to R and D 525 00:34:26,280 --> 00:34:29,480 Speaker 1: and CAPEX, the money is now going back to investors 526 00:34:29,520 --> 00:34:31,879 Speaker 1: in the form of buy backs. Well, there's a lot 527 00:34:31,880 --> 00:34:34,359 Speaker 1: of blowback about that. We can debate whether we're gonna 528 00:34:34,360 --> 00:34:38,160 Speaker 1: get any change, I'm not optimistic. But something you referenced 529 00:34:38,200 --> 00:34:45,239 Speaker 1: earlier was the purchase and sale of assets. Now you know, 530 00:34:45,320 --> 00:34:48,680 Speaker 1: this really becomes bad under Immelt in your book, but 531 00:34:48,960 --> 00:34:52,680 Speaker 1: it seemed like they were buying stuff just to make 532 00:34:52,719 --> 00:34:55,880 Speaker 1: the numbers look good without a doubt. I mean, that 533 00:34:56,040 --> 00:34:59,680 Speaker 1: was some of that, um you know, those sort of 534 00:34:59,760 --> 00:35:04,160 Speaker 1: lab sminute adjustments the GE capital would make every quarter. 535 00:35:04,400 --> 00:35:06,319 Speaker 1: And and I have quotes in the book from people 536 00:35:06,320 --> 00:35:08,440 Speaker 1: who worked at GE happening They're like, yeah, you know, 537 00:35:08,520 --> 00:35:10,759 Speaker 1: sometimes we needed a little more earnings by the end 538 00:35:10,800 --> 00:35:12,960 Speaker 1: of the year, and so we would go buy a 539 00:35:13,040 --> 00:35:16,000 Speaker 1: company that had some earnings and then they were our earnings, right, 540 00:35:17,040 --> 00:35:23,000 Speaker 1: And so that was a part of this absolute infatuation 541 00:35:23,080 --> 00:35:26,200 Speaker 1: with deal making that well Chad In in his twenty 542 00:35:26,280 --> 00:35:32,600 Speaker 1: years as CEO, he conducted something like one thousand mergers 543 00:35:32,640 --> 00:35:38,880 Speaker 1: and acquisitions. It was this unbelievably torrid pace of deal making, 544 00:35:39,440 --> 00:35:42,840 Speaker 1: which here's another one began during the whild chair and 545 00:35:42,880 --> 00:35:46,520 Speaker 1: has really never abated, and it's led to the consolidation 546 00:35:46,960 --> 00:35:51,359 Speaker 1: of American industries. It's less to more market concentration, and 547 00:35:51,440 --> 00:35:53,759 Speaker 1: plenty of academics who have done the work more so 548 00:35:53,840 --> 00:35:57,319 Speaker 1: than I have have pointed out that that market concentration, 549 00:35:57,440 --> 00:36:03,439 Speaker 1: that consolidation has led to an enormous amount of pain 550 00:36:03,560 --> 00:36:07,600 Speaker 1: for consumers in the form of higher prices and reduced 551 00:36:07,600 --> 00:36:13,399 Speaker 1: competition and ultimately reduced innovation for our country. Okay, let's 552 00:36:13,400 --> 00:36:17,359 Speaker 1: talk about a little closer with our feet on the ground. There. 553 00:36:17,520 --> 00:36:22,480 Speaker 1: He's worth. He owns his companies, and he's constantly laying 554 00:36:22,560 --> 00:36:29,000 Speaker 1: people off and closing companies. And there's a social cost 555 00:36:29,080 --> 00:36:33,480 Speaker 1: with people. Also, if they need people, they hire contractors. 556 00:36:34,080 --> 00:36:37,080 Speaker 1: Is this something that he pioneers or is he the 557 00:36:37,080 --> 00:36:40,000 Speaker 1: first one who blows it up? It's just this evidence 558 00:36:40,000 --> 00:36:42,320 Speaker 1: of what everybody was doing. No, he was one of 559 00:36:42,360 --> 00:36:45,120 Speaker 1: the first, and and time and again. And this is, Bob, 560 00:36:45,200 --> 00:36:47,080 Speaker 1: one of the things that struck me and gave me 561 00:36:47,160 --> 00:36:50,920 Speaker 1: the conviction to really keep going when I started looking 562 00:36:50,960 --> 00:36:53,960 Speaker 1: into this. He was the first time and dime and 563 00:36:54,040 --> 00:36:57,920 Speaker 1: dime again. He was the guy that essentially was the 564 00:36:57,960 --> 00:37:03,640 Speaker 1: progenitor of so many of these absolutely deletarious trends that 565 00:37:03,680 --> 00:37:06,960 Speaker 1: now seem like as fundamental to us as the weather 566 00:37:07,120 --> 00:37:09,200 Speaker 1: and the rising and setting of the sun, but are 567 00:37:09,239 --> 00:37:12,680 Speaker 1: actually just choices that rich executives made in the nineteen 568 00:37:12,719 --> 00:37:15,200 Speaker 1: eighties that we're all still living with. So when it 569 00:37:15,239 --> 00:37:19,279 Speaker 1: comes to outsourcing and offshore in ye, had there been 570 00:37:19,280 --> 00:37:22,080 Speaker 1: a little outsourcing and offshoreing in the years before that, 571 00:37:22,400 --> 00:37:26,000 Speaker 1: sure was well the first one to get on top 572 00:37:26,040 --> 00:37:29,799 Speaker 1: of a mountain and screen that this was the way 573 00:37:29,840 --> 00:37:32,600 Speaker 1: to do business. And was he the first to take 574 00:37:32,640 --> 00:37:38,839 Speaker 1: a major American employer and absolutely reshape it and make 575 00:37:38,880 --> 00:37:43,640 Speaker 1: it dependent not on what was essentially lifetime employees who 576 00:37:43,640 --> 00:37:46,439 Speaker 1: grew up inside that company and could expect to retire them, 577 00:37:46,840 --> 00:37:51,440 Speaker 1: but bring in this new, more transactional relationship with its 578 00:37:51,440 --> 00:37:55,839 Speaker 1: employees and state publicly that if he could, he would 579 00:37:55,880 --> 00:37:58,720 Speaker 1: put every factory on a barge so it would float 580 00:37:58,760 --> 00:38:03,560 Speaker 1: around the world and inner national waters, changing favorable exchange 581 00:38:03,640 --> 00:38:08,319 Speaker 1: rates and good anti you know, regulatory policies, and that 582 00:38:08,400 --> 00:38:14,080 Speaker 1: if he could, he wanted to make every job that 583 00:38:14,120 --> 00:38:18,120 Speaker 1: he could get to be done outside ge done outside ge. 584 00:38:19,040 --> 00:38:22,040 Speaker 1: If you could hire people at printing presses to print 585 00:38:22,440 --> 00:38:25,920 Speaker 1: his stuff printed, if you can fire food service workers 586 00:38:25,920 --> 00:38:28,480 Speaker 1: to work in his cafeteria, do it. And that's why 587 00:38:28,520 --> 00:38:30,720 Speaker 1: even today is an employee of the New York Times Company. 588 00:38:30,719 --> 00:38:32,520 Speaker 1: When I walk into the New York Times building, the 589 00:38:32,520 --> 00:38:34,640 Speaker 1: first person I see every morning does not work for 590 00:38:34,680 --> 00:38:37,799 Speaker 1: The New York Times. They are security guards who are 591 00:38:37,880 --> 00:38:41,200 Speaker 1: hired by a contractor, and I can only hope that 592 00:38:41,280 --> 00:38:45,879 Speaker 1: they enjoy fair wages and good benefits. But I don't 593 00:38:45,880 --> 00:38:49,160 Speaker 1: think it's a stretch to believe that it's not what 594 00:38:49,880 --> 00:38:53,160 Speaker 1: The New York Times offers his journalists and other people 595 00:38:53,360 --> 00:39:03,240 Speaker 1: on the payroll. Okay. The other thing Jack is famous 596 00:39:03,280 --> 00:39:06,359 Speaker 1: for is the ten percent firing, the ten percent at 597 00:39:06,360 --> 00:39:11,479 Speaker 1: the bottom. This was lauded unbelievably. Okay, and you wrote 598 00:39:11,480 --> 00:39:14,879 Speaker 1: a book about mindfulness, not that I'm exactly sure what 599 00:39:14,960 --> 00:39:20,200 Speaker 1: that means. But was this good for business? Was there 600 00:39:20,239 --> 00:39:25,279 Speaker 1: an ultimate cost in dissatisfaction and competition amongst the employees? 601 00:39:25,920 --> 00:39:30,360 Speaker 1: And how does mindfulness fit into the whole corporate structure? 602 00:39:30,880 --> 00:39:34,279 Speaker 1: M hm, Well, you're referring to stack ranking, which is 603 00:39:35,480 --> 00:39:41,200 Speaker 1: the process that Welch innovated pioneered of telling managers to 604 00:39:41,239 --> 00:39:45,520 Speaker 1: sort their employees into the top A, B and C players. 605 00:39:46,040 --> 00:39:49,200 Speaker 1: A players of your workforce, they're the best. The B 606 00:39:49,400 --> 00:39:53,640 Speaker 1: players are the mediocre, middle those you know in the middle, 607 00:39:54,160 --> 00:39:57,000 Speaker 1: and the bottom is the ten percent the C players. 608 00:39:57,360 --> 00:40:00,319 Speaker 1: And what said your ten players? Your ten percent those 609 00:40:00,320 --> 00:40:04,200 Speaker 1: c players every year they gotta go um. That was 610 00:40:04,280 --> 00:40:08,839 Speaker 1: one of these sort of cold hearted management techniques that 611 00:40:09,680 --> 00:40:14,240 Speaker 1: Welch pioneered and became popular at GE. But because GE 612 00:40:14,239 --> 00:40:18,399 Speaker 1: was so influential, everyone else started to do it, and 613 00:40:18,800 --> 00:40:22,640 Speaker 1: it really caught hold in corporate America and it continues 614 00:40:22,719 --> 00:40:26,120 Speaker 1: to this day. It was popular under Steve Balmer at 615 00:40:26,160 --> 00:40:29,600 Speaker 1: Microsoft for the longest time, and companies like we Work 616 00:40:29,680 --> 00:40:34,000 Speaker 1: and Uber have been using stack ranking even recently. So 617 00:40:34,400 --> 00:40:38,480 Speaker 1: yet again, here we have this sort of signature, weird, 618 00:40:39,440 --> 00:40:43,040 Speaker 1: sort of ruthless innovation by Welch about firing temper cent 619 00:40:43,120 --> 00:40:46,759 Speaker 1: of his workforce every year, something he started doing in 620 00:40:46,800 --> 00:40:51,320 Speaker 1: the nineteen eighties, still around with us forty years later. 621 00:40:51,719 --> 00:40:53,759 Speaker 1: This is the guy that broke capitalism. That's why I 622 00:40:53,760 --> 00:40:59,120 Speaker 1: called it that. Okay, just throw in the mindful news part. 623 00:40:59,239 --> 00:41:02,600 Speaker 1: How should people be operating? Because another point you make 624 00:41:02,600 --> 00:41:05,120 Speaker 1: in the book is this, you know, UH, as a 625 00:41:05,160 --> 00:41:10,840 Speaker 1: result of the stack ranking, it reduces UH cooperative working. 626 00:41:10,880 --> 00:41:13,279 Speaker 1: They're all sorts of costs that people don't see right 627 00:41:13,320 --> 00:41:17,600 Speaker 1: on the surface. So how should these companies be run? Listen, 628 00:41:17,640 --> 00:41:23,120 Speaker 1: I I'm not a management expert and I've never been 629 00:41:23,160 --> 00:41:25,799 Speaker 1: a CEO. And I'm the first to admit that. So 630 00:41:26,560 --> 00:41:29,080 Speaker 1: I can't tell a company exactly how to run. What 631 00:41:29,200 --> 00:41:32,719 Speaker 1: I can say is that when I look at CEOs 632 00:41:33,080 --> 00:41:38,799 Speaker 1: who are able to steward their companies in the long 633 00:41:38,920 --> 00:41:43,319 Speaker 1: term and create real value not only for their top investors, 634 00:41:43,880 --> 00:41:46,120 Speaker 1: the hedge funds that might own twelve of the stock 635 00:41:46,200 --> 00:41:49,920 Speaker 1: or whatever, but for all the different constituents that they serve, 636 00:41:50,040 --> 00:41:53,839 Speaker 1: from their employees, to their communities, to the you know, 637 00:41:54,200 --> 00:41:59,040 Speaker 1: people down their supply chain, and yes, of course their investors. Uh. 638 00:41:59,600 --> 00:42:03,560 Speaker 1: I see CEOs that operate in a fundamentally different way. 639 00:42:03,600 --> 00:42:07,480 Speaker 1: They are not mercenaries looking to cut costs wherever they can. 640 00:42:08,080 --> 00:42:11,520 Speaker 1: They are not you know, sort of these cold eyed 641 00:42:12,120 --> 00:42:16,560 Speaker 1: um you know being counters who simply focus on the 642 00:42:16,640 --> 00:42:20,839 Speaker 1: numbers to the exclusion of all other considerations. They are 643 00:42:20,960 --> 00:42:23,719 Speaker 1: men and women who take a much more holistic view 644 00:42:24,160 --> 00:42:28,840 Speaker 1: of their responsibilities as business leaders and bring to mind 645 00:42:29,280 --> 00:42:35,240 Speaker 1: the nuances of all of that complex set of responsibilities 646 00:42:35,280 --> 00:42:39,000 Speaker 1: that they have when making decisions about hiring and firing, 647 00:42:39,360 --> 00:42:44,160 Speaker 1: about investment, about strategy, and what companies they what kind 648 00:42:44,160 --> 00:42:46,319 Speaker 1: of companies they want to run, and what company is 649 00:42:46,760 --> 00:42:51,239 Speaker 1: they want to buy and sell. So I can't sit 650 00:42:51,320 --> 00:42:53,480 Speaker 1: here and give you a short answer to how to 651 00:42:53,560 --> 00:42:56,600 Speaker 1: run a company. What I can say is, in the 652 00:42:56,680 --> 00:43:01,400 Speaker 1: long run, the Jack Walsh playbook usually leads to ruin. Okay, 653 00:43:01,480 --> 00:43:04,440 Speaker 1: just because I'm interested. You know, they would have these 654 00:43:04,480 --> 00:43:09,040 Speaker 1: retreats at their campus, not the Fairfield campus, but a 655 00:43:09,080 --> 00:43:13,239 Speaker 1: separate campus, and other companies have replicated this is this 656 00:43:13,440 --> 00:43:17,239 Speaker 1: just basically an old boys network? What really goes on there? 657 00:43:17,400 --> 00:43:20,480 Speaker 1: Is there any benefit? I think a lot of people 658 00:43:20,480 --> 00:43:23,760 Speaker 1: who went there would say there's lots of benefit. Um, 659 00:43:24,120 --> 00:43:28,800 Speaker 1: this was you're referring to a place colloquially known as Crotonville, 660 00:43:29,280 --> 00:43:32,239 Speaker 1: which was the g E Management Development Center. I think 661 00:43:32,280 --> 00:43:35,160 Speaker 1: I got that right in Croton on Hudson, a small 662 00:43:35,239 --> 00:43:38,759 Speaker 1: village just north of New York City, and it was 663 00:43:38,880 --> 00:43:42,000 Speaker 1: one of the first of its kind sort of offsite 664 00:43:42,080 --> 00:43:46,520 Speaker 1: retreat centers executive learning centers. Uh. And as you said, 665 00:43:46,560 --> 00:43:50,840 Speaker 1: it was replicated by many other big American companies, including me. 666 00:43:50,960 --> 00:43:54,279 Speaker 1: I'm going to forget them all, but had Hotchi, IBM, Bowie, etcetera. 667 00:43:54,880 --> 00:43:57,480 Speaker 1: All sort of saw what che did and made it 668 00:43:57,880 --> 00:44:00,840 Speaker 1: and over the years it served many different purposes. Welch 669 00:44:00,880 --> 00:44:03,200 Speaker 1: wasn't the one who who pioneered it. He sort of 670 00:44:03,360 --> 00:44:05,399 Speaker 1: revived it and brought it back when he took over, 671 00:44:06,080 --> 00:44:09,719 Speaker 1: but it was it was extant for much of the 672 00:44:09,719 --> 00:44:13,719 Speaker 1: twentieth century and served as a place where GE leaders 673 00:44:13,800 --> 00:44:16,400 Speaker 1: would go and essentially go to in house business school. 674 00:44:17,239 --> 00:44:19,520 Speaker 1: This is where they could go brush up on strategy 675 00:44:20,160 --> 00:44:23,799 Speaker 1: learned from their colleagues, take classes on this, that or 676 00:44:23,840 --> 00:44:28,239 Speaker 1: the other. You know, how to dodge taxes? Um. I 677 00:44:28,280 --> 00:44:31,799 Speaker 1: don't know exactly what the curriculum was under Welch, but 678 00:44:31,840 --> 00:44:35,440 Speaker 1: it was clear that this was an effort by him 679 00:44:35,680 --> 00:44:41,000 Speaker 1: and his executive team to create a system where they 680 00:44:41,040 --> 00:44:45,680 Speaker 1: could drive their values, drive their vision, drive their tactics 681 00:44:46,080 --> 00:44:49,440 Speaker 1: deep down into the organization. And by all accounts, it 682 00:44:49,520 --> 00:44:54,200 Speaker 1: was very successful. Um so was it old boys club? Yeah? 683 00:44:54,239 --> 00:44:56,239 Speaker 1: I'm sure there were elements of that. You put enough 684 00:44:56,840 --> 00:45:01,200 Speaker 1: well paid executives at an off site and inevitably there's 685 00:45:01,200 --> 00:45:04,120 Speaker 1: gonna be some uh, some antics, and I document some 686 00:45:04,200 --> 00:45:07,640 Speaker 1: of those in the book. But but I think the 687 00:45:07,680 --> 00:45:11,160 Speaker 1: more interesting thing to me is the degree to which 688 00:45:11,560 --> 00:45:18,480 Speaker 1: they really formalized the um. The teaching formalized the training 689 00:45:19,000 --> 00:45:22,880 Speaker 1: of the Jackbosh worldview for so many thousands of g 690 00:45:23,000 --> 00:45:26,680 Speaker 1: E employees who worked there. Okay, let's talk about the 691 00:45:26,719 --> 00:45:31,960 Speaker 1: big one from the street level executive compensation. I did 692 00:45:32,040 --> 00:45:34,560 Speaker 1: not grow up in a poor environment, but you were 693 00:45:34,760 --> 00:45:39,200 Speaker 1: rich if you drove a Cadillac. Okay, maybe I grew 694 00:45:39,280 --> 00:45:42,480 Speaker 1: up next to Westport, Connecticut. I think I saw Ferrari 695 00:45:42,640 --> 00:45:45,400 Speaker 1: once in my whole life until I moved to Los Angeles. 696 00:45:46,520 --> 00:45:50,160 Speaker 1: So you have these incredible paid packages which go on 697 00:45:50,239 --> 00:45:53,640 Speaker 1: to today. Now, one of the things these companies or 698 00:45:53,680 --> 00:45:57,080 Speaker 1: these boards say, if we don't pay this amount of money, 699 00:45:57,160 --> 00:46:02,840 Speaker 1: somebody else will to what the we? Is Jack responsible 700 00:46:02,880 --> 00:46:08,160 Speaker 1: for this incredible run up in executive compensation? Yeah, here's 701 00:46:08,200 --> 00:46:10,160 Speaker 1: another one where I think I'll put a little of 702 00:46:10,160 --> 00:46:13,440 Speaker 1: the blame in his feet, but certainly not all of it. UM, 703 00:46:13,640 --> 00:46:15,720 Speaker 1: no doubt about it. He was one of the first 704 00:46:16,120 --> 00:46:18,919 Speaker 1: CEOs in the nineteen eighties and nineteen nineties to start 705 00:46:18,960 --> 00:46:22,640 Speaker 1: getting these gargantuan pay packages. And it's important to remember 706 00:46:22,680 --> 00:46:25,360 Speaker 1: that he was not an inventor, he was not a founder. 707 00:46:25,640 --> 00:46:28,920 Speaker 1: He is a people manager. Um. He was. He was 708 00:46:28,960 --> 00:46:32,640 Speaker 1: paid to run this company, uh, and he was rewarded 709 00:46:32,680 --> 00:46:35,160 Speaker 1: as if he were a king for it. He made 710 00:46:35,800 --> 00:46:38,160 Speaker 1: first tens of millions of dollars and hundreds of millions 711 00:46:38,160 --> 00:46:40,560 Speaker 1: of dollars. By the end of his career, his net 712 00:46:40,560 --> 00:46:43,120 Speaker 1: worth was approaching a billion dollars. He was on the 713 00:46:43,239 --> 00:46:47,279 Speaker 1: Ford four hundred list of the richest Americans arrive at 714 00:46:47,280 --> 00:46:52,319 Speaker 1: the time. Uh, and so was he emblematic of it? Absolutely? 715 00:46:52,480 --> 00:46:55,000 Speaker 1: Was his board complicit? And do they deserve a ton 716 00:46:55,040 --> 00:46:59,719 Speaker 1: of the blame? Absolutely? Was it probably gonna happen in 717 00:46:59,800 --> 00:47:02,879 Speaker 1: any case? I think, so this is this is one 718 00:47:03,040 --> 00:47:08,959 Speaker 1: where the there were enough other people who saw the opportunity. 719 00:47:09,040 --> 00:47:12,840 Speaker 1: My sense is that, um, it's hard for me to 720 00:47:12,880 --> 00:47:18,200 Speaker 1: see sort of a an alternate history where we don't 721 00:47:18,280 --> 00:47:23,160 Speaker 1: have executive compensation that's just wildly out of control in 722 00:47:23,200 --> 00:47:25,920 Speaker 1: the way that it is today. Um, because you know, 723 00:47:25,920 --> 00:47:27,839 Speaker 1: that's and it's like the American story to me, this 724 00:47:27,880 --> 00:47:30,399 Speaker 1: is where just the nature of who we are as 725 00:47:30,400 --> 00:47:34,120 Speaker 1: a country and our you know, the absence of guardrails 726 00:47:34,320 --> 00:47:37,000 Speaker 1: on on the economy and on capitalism that we seem 727 00:47:37,120 --> 00:47:39,920 Speaker 1: to love so much, it takes us to these truly 728 00:47:40,040 --> 00:47:44,719 Speaker 1: unhealthy extremes and and basically people say, you know, we're 729 00:47:44,719 --> 00:47:47,080 Speaker 1: not going to do anything about it, and and so 730 00:47:47,160 --> 00:47:50,160 Speaker 1: what Yeah, So that that's sort of how I think 731 00:47:50,200 --> 00:47:55,600 Speaker 1: about Welch in the executive compensation. Was he a main driver? Yes? 732 00:47:55,760 --> 00:47:58,879 Speaker 1: Was he solely responsible? I want to be careful there. 733 00:47:59,760 --> 00:48:03,200 Speaker 1: Oh okay. One big element of the book is how 734 00:48:03,320 --> 00:48:08,040 Speaker 1: his disciples go on to blow up these companies across America. 735 00:48:08,239 --> 00:48:12,280 Speaker 1: So he's so successful, other boards want some of this magic. 736 00:48:13,360 --> 00:48:19,920 Speaker 1: These employees that are now CEOs replicate the paradigm, and 737 00:48:20,000 --> 00:48:24,520 Speaker 1: the companies do incredibly poorly. Tell us about that. Even 738 00:48:24,600 --> 00:48:32,600 Speaker 1: before Jack was born, GE was seen as the training 739 00:48:32,600 --> 00:48:36,920 Speaker 1: ground for other executives around corporate America. It had this 740 00:48:37,120 --> 00:48:41,600 Speaker 1: long and distinguished history throughout the twentieth century of being 741 00:48:41,680 --> 00:48:47,640 Speaker 1: the place where other CEOs were taught how to do 742 00:48:47,760 --> 00:48:50,319 Speaker 1: their business, which is to say that when another company 743 00:48:50,640 --> 00:48:54,440 Speaker 1: wanted to hire their next CEO, they looked to GE. 744 00:48:55,280 --> 00:48:58,799 Speaker 1: The thinking was that g E executives were just head 745 00:48:58,840 --> 00:49:02,439 Speaker 1: and shoulders above the rest of the competition. And for 746 00:49:02,480 --> 00:49:06,799 Speaker 1: that reason, people already before Jack wanted to hire from 747 00:49:06,880 --> 00:49:11,279 Speaker 1: g when they needed a new boss. Under Welch, that 748 00:49:11,400 --> 00:49:15,960 Speaker 1: was taken to a wild extreme. And that is because 749 00:49:15,960 --> 00:49:19,919 Speaker 1: in part Jack Welch was so successful during his run 750 00:49:20,080 --> 00:49:24,880 Speaker 1: in generating stock value, and so when other CEOs and 751 00:49:24,960 --> 00:49:28,960 Speaker 1: boards said we need a new CEO. They thought that 752 00:49:29,040 --> 00:49:32,160 Speaker 1: people who worked for Welch might have the Midas touch, 753 00:49:33,239 --> 00:49:35,239 Speaker 1: that if they were able to be a part of 754 00:49:35,239 --> 00:49:40,200 Speaker 1: Welch's machine making so much money for GE shareholders, maybe 755 00:49:40,239 --> 00:49:43,760 Speaker 1: they could do it at all these other companies. And 756 00:49:44,000 --> 00:49:47,600 Speaker 1: as a result, I don't I don't have a specific count, 757 00:49:47,640 --> 00:49:50,440 Speaker 1: and I don't know that anyone does, because there were, frankly, 758 00:49:50,520 --> 00:49:54,320 Speaker 1: so many over so many years. But there are dozens 759 00:49:54,320 --> 00:49:58,520 Speaker 1: and dozens and dozens, probably more than sixty individuals who 760 00:49:58,600 --> 00:50:01,319 Speaker 1: worked directly for Welch and then went on to run 761 00:50:01,440 --> 00:50:04,600 Speaker 1: other US public companies. And while I don't have a 762 00:50:04,719 --> 00:50:08,759 Speaker 1: completely exhaustive list because I don't know again that one 763 00:50:08,840 --> 00:50:12,080 Speaker 1: is available, what I can say with certainty is that 764 00:50:12,600 --> 00:50:18,320 Speaker 1: almost in every case, the same story repeated itself, ad infinitum. 765 00:50:18,400 --> 00:50:21,560 Speaker 1: The CEO was hired by a new company from a 766 00:50:21,560 --> 00:50:26,280 Speaker 1: position at g E. They were giving a multimillion dollar 767 00:50:26,640 --> 00:50:30,400 Speaker 1: pay package that ensured them a gilded retirement no matter 768 00:50:30,440 --> 00:50:35,319 Speaker 1: what happened to that company. They put to work the 769 00:50:35,440 --> 00:50:42,560 Speaker 1: Jackwelt style of management, downsizing deal making, often diving into 770 00:50:42,560 --> 00:50:47,120 Speaker 1: finance in many cases, and then within months, sometimes it 771 00:50:47,160 --> 00:50:49,959 Speaker 1: was sometimes it was quarters, maybe it was a year 772 00:50:50,400 --> 00:50:54,600 Speaker 1: or two in a few cases, but relatively quickly. All 773 00:50:54,719 --> 00:50:57,000 Speaker 1: these bad decisions would catch up with them and with 774 00:50:57,040 --> 00:51:02,080 Speaker 1: the company, and the CEOs almost always left the company's 775 00:51:02,120 --> 00:51:06,479 Speaker 1: worse off than they inherited them. The CEOs did get 776 00:51:06,480 --> 00:51:09,880 Speaker 1: their pay package, but many were forced to resign or 777 00:51:09,960 --> 00:51:13,719 Speaker 1: step down early, and then the companies had to reset 778 00:51:14,000 --> 00:51:17,879 Speaker 1: because it was proven that well, yeah, Jack was able 779 00:51:17,920 --> 00:51:20,840 Speaker 1: to do it for twenty years at g E. The 780 00:51:20,920 --> 00:51:25,040 Speaker 1: strategy just simply does not work, not only in the 781 00:51:25,120 --> 00:51:28,800 Speaker 1: long term, but but oftentimes in the short term too. Okay, 782 00:51:28,880 --> 00:51:33,000 Speaker 1: let's talk specifically about Boeing. So Boeing is a legendary 783 00:51:33,040 --> 00:51:38,000 Speaker 1: American company. They hire a new g disciple, which I 784 00:51:38,080 --> 00:51:41,080 Speaker 1: was not aware of the time, and move the headquarters 785 00:51:41,120 --> 00:51:44,280 Speaker 1: to Chicago. That's like the Dodgers having their front office 786 00:51:44,320 --> 00:51:48,960 Speaker 1: in New York. It just makes no sense. So walk 787 00:51:49,040 --> 00:51:52,800 Speaker 1: us through what happened there, how that guy got the job, 788 00:51:52,880 --> 00:51:58,120 Speaker 1: and why the board was so complicit. Yeah, besides Ge itself, 789 00:51:58,160 --> 00:52:02,240 Speaker 1: there's no company that was more directly shaped by Welch 790 00:52:02,280 --> 00:52:07,200 Speaker 1: than Bowing. It began in n when Bowing merged with 791 00:52:07,280 --> 00:52:12,319 Speaker 1: McDonald Douglas, another fading American aircraft manufacturer and As part 792 00:52:12,320 --> 00:52:15,320 Speaker 1: of that deal, they got this guy named Harry stone 793 00:52:15,320 --> 00:52:20,319 Speaker 1: Cipher who had worked with Jack under uh at Ge 794 00:52:20,400 --> 00:52:24,160 Speaker 1: and then was running McDonald douglas and then joins Bowing 795 00:52:24,360 --> 00:52:27,640 Speaker 1: as part of the merger as a president, not CEO 796 00:52:27,719 --> 00:52:30,600 Speaker 1: at the time, but as president. But because he had 797 00:52:30,640 --> 00:52:33,480 Speaker 1: so much stock in McDonald douglas, all of a sudden 798 00:52:33,920 --> 00:52:37,719 Speaker 1: he's the biggest stock owner at the company. And this 799 00:52:37,800 --> 00:52:41,000 Speaker 1: guy who's just the president of the company was the 800 00:52:41,120 --> 00:52:45,920 Speaker 1: CEO of a subsidiary now that was merged into Bowing. 801 00:52:46,520 --> 00:52:48,560 Speaker 1: He has the most stock, and all of a sudden 802 00:52:48,640 --> 00:52:52,479 Speaker 1: he starts throwing his weight around inside Bowing, and over 803 00:52:52,480 --> 00:52:55,880 Speaker 1: the next several years he becomes CEO and makes, as 804 00:52:55,920 --> 00:52:59,880 Speaker 1: you said, this fateful decision to move Bowing headquarters from Seattle, 805 00:53:00,320 --> 00:53:04,520 Speaker 1: birthplace of commercial aviation in the country, to Chicago. And 806 00:53:04,560 --> 00:53:08,000 Speaker 1: why do they do it? For tax breaks? You know, 807 00:53:08,040 --> 00:53:10,040 Speaker 1: as you said, I love them, I love the Dodgers 808 00:53:10,040 --> 00:53:13,799 Speaker 1: metaphor uh and and it was it had nothing to 809 00:53:13,880 --> 00:53:17,200 Speaker 1: do with running a good business and everything to do 810 00:53:17,320 --> 00:53:20,440 Speaker 1: with making a profit. And in fact, Stonesife for himself 811 00:53:20,520 --> 00:53:22,640 Speaker 1: said this in two thousand four, he gave an interview 812 00:53:22,680 --> 00:53:25,800 Speaker 1: where he said, and some people say I'm not running 813 00:53:25,840 --> 00:53:28,920 Speaker 1: Bowing like an engineering company, and that's right. I'm trying 814 00:53:28,920 --> 00:53:31,640 Speaker 1: to run up like a business people expect to make money. 815 00:53:32,080 --> 00:53:35,200 Speaker 1: It's not an engineering firm. Something to that effect. And 816 00:53:35,239 --> 00:53:40,440 Speaker 1: it was this admission that the Bowing that everyone knew 817 00:53:40,640 --> 00:53:43,839 Speaker 1: and respected, which is a company that was defined by 818 00:53:43,920 --> 00:53:49,120 Speaker 1: quality aeronautical engineering, was not long for this world. But 819 00:53:49,360 --> 00:53:51,960 Speaker 1: he was just the first. Harry Stonesifer was the first 820 00:53:52,200 --> 00:53:55,799 Speaker 1: of three CEOs who worked directly for Welch who have 821 00:53:55,960 --> 00:53:58,439 Speaker 1: run Bowing over the last twenty years, and I've really 822 00:53:58,520 --> 00:54:02,560 Speaker 1: overseen its declined as a great American company. After stone 823 00:54:02,600 --> 00:54:05,160 Speaker 1: Cipher was fired in two thousand five for having an 824 00:54:05,160 --> 00:54:08,279 Speaker 1: affair with the subordinate. The guy that they tapped to 825 00:54:08,280 --> 00:54:11,520 Speaker 1: replace him as Jim McNerney, another Welsh disciple who was 826 00:54:11,560 --> 00:54:13,840 Speaker 1: actually one of the runner ups after Jeff mmel to 827 00:54:13,880 --> 00:54:18,719 Speaker 1: take over Welch's job. Jim McNerney takes over Bowing after 828 00:54:18,760 --> 00:54:21,680 Speaker 1: running three M for a few years and keeps on 829 00:54:21,760 --> 00:54:25,200 Speaker 1: with this sort of implementation of the Jack Welch playbook. 830 00:54:25,520 --> 00:54:29,160 Speaker 1: He looks at what they do uh and how they're 831 00:54:29,160 --> 00:54:32,120 Speaker 1: going to build their next plane, the seven, and he 832 00:54:32,320 --> 00:54:36,319 Speaker 1: makes two absolutely pivotal decisions. He says, we don't want 833 00:54:36,320 --> 00:54:38,840 Speaker 1: to build it in Seattle because there's too much union 834 00:54:38,920 --> 00:54:41,840 Speaker 1: labor there. So they open up a new manufacturing facility 835 00:54:41,880 --> 00:54:45,200 Speaker 1: in Charleston, where there's not as much unionized labor and 836 00:54:45,239 --> 00:54:48,239 Speaker 1: where there's no history of aviation manufacturing. And so, guess what, 837 00:54:48,320 --> 00:54:51,240 Speaker 1: there's all these problems on those planes, something I documented 838 00:54:51,280 --> 00:54:53,120 Speaker 1: on the front page of the paper. And the other 839 00:54:53,120 --> 00:54:55,680 Speaker 1: thing he does is start to embrace outsourcing. Is Jack 840 00:54:55,719 --> 00:55:01,399 Speaker 1: Welch love outsourcing? And so where is Boeing historically manufactured 841 00:55:01,600 --> 00:55:04,640 Speaker 1: something like two thirds of the parts on any given 842 00:55:04,719 --> 00:55:08,400 Speaker 1: airplane and outsource the other third. The ratio has flipped 843 00:55:08,440 --> 00:55:11,319 Speaker 1: under McNerney, and all of a sudden, they're outsourcing two 844 00:55:11,400 --> 00:55:14,000 Speaker 1: thirds of the parts on their own plane and only 845 00:55:14,080 --> 00:55:16,800 Speaker 1: building a third of it themselves. And they lose control 846 00:55:16,840 --> 00:55:20,719 Speaker 1: of quality, that lose control of timing. And then McNerney 847 00:55:20,760 --> 00:55:23,320 Speaker 1: makes the what I think is the most fateful decision 848 00:55:23,560 --> 00:55:25,759 Speaker 1: in two thousand and eleven, he's about to lose a 849 00:55:25,800 --> 00:55:29,560 Speaker 1: big order of seven thirty seven's to America to air Bus, 850 00:55:29,560 --> 00:55:34,080 Speaker 1: his chief rival, two American airlines, and he tells American Airlines, 851 00:55:34,160 --> 00:55:35,840 Speaker 1: you know what, give us another week. We got a 852 00:55:35,840 --> 00:55:39,120 Speaker 1: decision to make. They decide to redesign the seven thirty 853 00:55:39,160 --> 00:55:43,080 Speaker 1: seven one more time, rather than create a new airplane 854 00:55:43,080 --> 00:55:45,240 Speaker 1: which would have taken them longer, which would have made 855 00:55:46,200 --> 00:55:47,880 Speaker 1: would have which would have meant that they would have 856 00:55:47,920 --> 00:55:51,879 Speaker 1: lost out this critical order to air Bus. And he says, 857 00:55:52,880 --> 00:55:55,319 Speaker 1: we will redesign the seven thirty seven one more time, 858 00:55:55,480 --> 00:55:58,040 Speaker 1: and that point becomes the seven thirty seven packs, which 859 00:55:58,080 --> 00:56:02,120 Speaker 1: of course crashed twice in five months, killing three sex people, 860 00:56:02,160 --> 00:56:04,279 Speaker 1: something I spent a year of my life reporting on. 861 00:56:06,040 --> 00:56:09,080 Speaker 1: McNerney is finally replaced by a man named Dennis Muhlenberg. 862 00:56:09,239 --> 00:56:14,800 Speaker 1: Muhlenberg oversees the two crashes, the period around the two crashes, 863 00:56:15,080 --> 00:56:19,440 Speaker 1: and when Muhlllemberg is finally fired because it's completely inept 864 00:56:19,800 --> 00:56:23,880 Speaker 1: in managing Bowing through a crisis, he's replaced by Dave Calhoun, 865 00:56:24,440 --> 00:56:27,600 Speaker 1: yet another Welch disciple, a guy who, at the age 866 00:56:27,640 --> 00:56:30,800 Speaker 1: of forty two was considered a potential successor to Welch 867 00:56:30,920 --> 00:56:35,200 Speaker 1: because he was such a likeness of the young Welch himself, 868 00:56:35,640 --> 00:56:38,680 Speaker 1: and who to this day is the CEO of the 869 00:56:38,680 --> 00:56:42,920 Speaker 1: Boeing Company. Okay, how did you end up on the 870 00:56:42,960 --> 00:56:48,759 Speaker 1: Bowing beat? I walked into the newsroom one morning in 871 00:56:49,200 --> 00:56:54,200 Speaker 1: I guess it was March of two thousand nineteen, having 872 00:56:54,239 --> 00:56:57,600 Speaker 1: never written about the airline industry before, but sitting next 873 00:56:57,600 --> 00:57:00,880 Speaker 1: to the woman who had been covering airlines for US, 874 00:57:00,880 --> 00:57:03,040 Speaker 1: but who happened to be on vacation that day. And 875 00:57:03,080 --> 00:57:05,400 Speaker 1: when the business editor of the New York Times wandered 876 00:57:05,440 --> 00:57:09,719 Speaker 1: over to our desk, she said, Julie's gone, David, what 877 00:57:09,760 --> 00:57:11,560 Speaker 1: are you doing right now? And I said the only 878 00:57:11,719 --> 00:57:14,000 Speaker 1: right answer, which is I don't know what am I 879 00:57:14,000 --> 00:57:17,120 Speaker 1: doing right now? You tell me, boss, And she said, 880 00:57:17,120 --> 00:57:19,920 Speaker 1: called Bowing because another plane had just crashed. And that 881 00:57:20,040 --> 00:57:22,280 Speaker 1: was how I began covering it. Um one of the 882 00:57:22,360 --> 00:57:26,240 Speaker 1: things we can do as reporters, um is learned pretty quickly. 883 00:57:26,560 --> 00:57:28,960 Speaker 1: And so the next year of my life was a 884 00:57:29,120 --> 00:57:32,080 Speaker 1: UM I was going to use a poor metaphor there, 885 00:57:32,120 --> 00:57:36,680 Speaker 1: but but but an accelerated learning period of trying to 886 00:57:36,720 --> 00:57:41,360 Speaker 1: understand the airline industry and UM getting, you know, ultimately 887 00:57:41,480 --> 00:57:45,720 Speaker 1: pretty deeply sourced inside the Bowing company, you know, Boeing 888 00:57:45,960 --> 00:57:51,400 Speaker 1: obfuscated and denied responsibility. Trump seemed to be on their 889 00:57:51,440 --> 00:57:55,240 Speaker 1: team to what did we were you in the press 890 00:57:55,320 --> 00:57:59,440 Speaker 1: responsible for opening this story and shining light on the facts. 891 00:57:59,720 --> 00:58:03,160 Speaker 1: And what was it like being right? You know, they're 892 00:58:03,200 --> 00:58:06,080 Speaker 1: on the point of a story. Well, I mean, we 893 00:58:06,200 --> 00:58:11,000 Speaker 1: broke a ton of important critical stories in the Bowing coverage. 894 00:58:11,240 --> 00:58:15,160 Speaker 1: So did the Wall Street Journal, so did the Seattle Times. Uh, 895 00:58:15,560 --> 00:58:17,919 Speaker 1: there was a huge amount of media interest, and there's 896 00:58:17,920 --> 00:58:22,720 Speaker 1: no doubt that some of the revelations that the Times, 897 00:58:22,760 --> 00:58:26,400 Speaker 1: the Journal in the Seattle Times were responsible in helping 898 00:58:26,480 --> 00:58:32,920 Speaker 1: uncover tremendously helped shape the narrative and um ultimately exposed 899 00:58:32,920 --> 00:58:37,840 Speaker 1: what had actually happened. It's also true that the House 900 00:58:38,000 --> 00:58:43,280 Speaker 1: Transportation and Infrastructure Committee took this very seriously and devoted 901 00:58:43,440 --> 00:58:49,080 Speaker 1: a huge amount of federal legislative investigative muscle to this story. 902 00:58:49,640 --> 00:58:52,600 Speaker 1: And as a result, we're able to obtain I gotta 903 00:58:52,600 --> 00:58:55,760 Speaker 1: believe millions and millions of pages of Bowing documents, of 904 00:58:55,840 --> 00:58:59,160 Speaker 1: which many hundreds or maybe a few thousand were ultimately 905 00:58:59,200 --> 00:59:02,640 Speaker 1: made public and earns about the crashes. Um, So there 906 00:59:02,720 --> 00:59:05,120 Speaker 1: were there were a lot of eyes on Bowing after 907 00:59:05,160 --> 00:59:09,000 Speaker 1: the second crash, of course. Uh. And I want to 908 00:59:09,040 --> 00:59:12,040 Speaker 1: respect the work we did and our competitors did, but 909 00:59:12,040 --> 00:59:13,960 Speaker 1: but I don't think it's fair to say that the 910 00:59:14,000 --> 00:59:18,600 Speaker 1: press alone was responsible for uncovering, you know, the true 911 00:59:18,760 --> 00:59:29,800 Speaker 1: and full story of what happened inside Boeing. Now is 912 00:59:29,840 --> 00:59:31,800 Speaker 1: your role, in your role as a reporter for The 913 00:59:31,800 --> 00:59:35,480 Speaker 1: New York's Times on this beat? To what degree was 914 00:59:35,640 --> 00:59:41,960 Speaker 1: reporting based on accumulating and reading these documents as opposed 915 00:59:42,040 --> 00:59:46,000 Speaker 1: to getting on the phone sending emails asking people questions. 916 00:59:46,320 --> 00:59:50,120 Speaker 1: Is this for Bowing or for the book for Boeing? Oh, 917 00:59:50,200 --> 00:59:53,040 Speaker 1: it was a mix. I mean, we we had a 918 00:59:53,120 --> 00:59:56,160 Speaker 1: spreadsheet and I think I can talk about this publicly, 919 00:59:56,240 --> 00:59:58,240 Speaker 1: but there was a team of reporters working on It 920 00:59:58,280 --> 01:00:01,880 Speaker 1: wasn't just me, and we as a team had a 921 01:00:01,960 --> 01:00:05,400 Speaker 1: shared Google doc that, by the end of our year 922 01:00:05,560 --> 01:00:08,760 Speaker 1: on this story had the names of more than a 923 01:00:08,800 --> 01:00:12,280 Speaker 1: thousand people who we had contacted. And so there was 924 01:00:12,320 --> 01:00:15,160 Speaker 1: a lot of cold calling. There was knocking on doors, 925 01:00:15,600 --> 01:00:19,560 Speaker 1: There were handwritten letters that were sent. Uh, there were 926 01:00:19,600 --> 01:00:23,960 Speaker 1: you know, innumerable LinkedIn messages and Twitter dems. We we 927 01:00:24,000 --> 01:00:26,760 Speaker 1: worked real hard to talk to as many people as 928 01:00:26,800 --> 01:00:29,840 Speaker 1: we could, and we ultimately got you know, many many 929 01:00:29,880 --> 01:00:34,480 Speaker 1: important voices on the record. Um who who for? You know, 930 01:00:34,520 --> 01:00:36,800 Speaker 1: A variety of reasons initially didn't want to go on 931 01:00:36,840 --> 01:00:41,000 Speaker 1: the record, and and that was pivotal reporting that did shape, 932 01:00:41,280 --> 01:00:45,200 Speaker 1: um beyond, sort of the arc of the investigation itself. Definitely, 933 01:00:45,480 --> 01:00:48,720 Speaker 1: I think I can say with confidence affected personnel decisions 934 01:00:48,720 --> 01:00:51,080 Speaker 1: at Boeing. It was, you know, just the day after 935 01:00:51,520 --> 01:00:53,160 Speaker 1: I published a story on the front page of The 936 01:00:53,160 --> 01:00:59,560 Speaker 1: New York Times with the CEO of Southwest Airlines essentially 937 01:01:00,200 --> 01:01:05,440 Speaker 1: bad mouthing bowing and its leadership, that Dennis Muhgenberg was fired. Uh. 938 01:01:05,480 --> 01:01:10,040 Speaker 1: And those kind of things matter. Um Uh, those kind 939 01:01:10,040 --> 01:01:14,760 Speaker 1: of stories definitely, as you know, get noticed inside a 940 01:01:14,800 --> 01:01:19,640 Speaker 1: big company. Um. So we talked again. You know, I 941 01:01:19,720 --> 01:01:22,200 Speaker 1: personally talked to hundreds of people. With my colleagues, we 942 01:01:22,320 --> 01:01:24,480 Speaker 1: talked to more than a thousand people, and we read 943 01:01:24,680 --> 01:01:27,440 Speaker 1: I don't know how many, you know, thousands of pages 944 01:01:27,480 --> 01:01:31,840 Speaker 1: of airline manuals and documents along the way. Okay, I 945 01:01:31,880 --> 01:01:34,440 Speaker 1: want to drill down really to where the rubber meets 946 01:01:34,440 --> 01:01:38,960 Speaker 1: the road. People are more sophisticated now than they used 947 01:01:39,000 --> 01:01:41,160 Speaker 1: to be. Something happened such that you're at the center 948 01:01:41,160 --> 01:01:44,680 Speaker 1: of a news item. Reporters come out of the woodwork. 949 01:01:44,760 --> 01:01:47,920 Speaker 1: They want to be your best friend. Whatever happens, they 950 01:01:47,920 --> 01:01:49,640 Speaker 1: move on to the next story when they're done with 951 01:01:49,720 --> 01:01:54,080 Speaker 1: you and people are more sophisticated than that. To what 952 01:01:54,280 --> 01:02:00,120 Speaker 1: degree are you anxious about asking people questions? And and 953 01:02:00,440 --> 01:02:03,040 Speaker 1: a lot of people are not withcoming? How do you 954 01:02:03,120 --> 01:02:07,120 Speaker 1: convince them to be forthcoming? Yeah, I don't have a 955 01:02:07,160 --> 01:02:11,120 Speaker 1: lot of anxiety about asking people questions. Um, I'm I 956 01:02:11,160 --> 01:02:13,760 Speaker 1: put my cards on the table when I'm talking to someone, 957 01:02:13,800 --> 01:02:15,840 Speaker 1: I tell them what I want to talk about, So 958 01:02:17,080 --> 01:02:21,680 Speaker 1: that doesn't. Um, that's not a big inhibitor in my 959 01:02:21,720 --> 01:02:25,440 Speaker 1: own work in terms of convincing people to talk to 960 01:02:26,440 --> 01:02:29,200 Speaker 1: us or to go on the record about things they 961 01:02:29,240 --> 01:02:32,440 Speaker 1: might be uncomfortable with. That's one of the hardest things 962 01:02:32,560 --> 01:02:35,880 Speaker 1: and I'm I'm frankly not an expert at it. That's 963 01:02:36,000 --> 01:02:37,919 Speaker 1: I've done some of that in my career, but it's 964 01:02:37,960 --> 01:02:41,440 Speaker 1: not my bread and butter. Um. I think that you know, 965 01:02:42,400 --> 01:02:46,360 Speaker 1: people like my friend Emily Steele, who helped break the 966 01:02:46,360 --> 01:02:52,240 Speaker 1: Bill O'Riley story, our colleagues Jodi Canter and Megan Tooey 967 01:02:52,320 --> 01:02:55,880 Speaker 1: who broke the Harvey Weinstein story for us, they are 968 01:02:56,360 --> 01:03:00,640 Speaker 1: way more seasoned than I in convincing people to talk, 969 01:03:01,000 --> 01:03:05,360 Speaker 1: especially on the record, about really difficult and challenging things. 970 01:03:05,880 --> 01:03:07,800 Speaker 1: H But I think at the end of the day. 971 01:03:07,920 --> 01:03:10,560 Speaker 1: What they would say, if I could summarize for them, 972 01:03:10,640 --> 01:03:13,440 Speaker 1: and what I would say is, you gotta appeal to 973 01:03:14,720 --> 01:03:17,720 Speaker 1: the greater good. And you've got to convince people that, 974 01:03:18,160 --> 01:03:20,680 Speaker 1: even if they don't want to do this, and they 975 01:03:20,760 --> 01:03:23,920 Speaker 1: believe that there might be some personal repercussions for them 976 01:03:23,960 --> 01:03:27,360 Speaker 1: in the form of blowback or embarrassment or making them 977 01:03:27,360 --> 01:03:29,320 Speaker 1: a public figure in a way they're not ready for, 978 01:03:30,080 --> 01:03:32,720 Speaker 1: that there is a greater social good at work here, 979 01:03:33,160 --> 01:03:37,440 Speaker 1: and that they have the opportunity to, you know, help 980 01:03:37,520 --> 01:03:40,960 Speaker 1: make things better for other people, to prevent some suffering 981 01:03:41,040 --> 01:03:43,760 Speaker 1: for other people down the line, uh, and to make 982 01:03:43,800 --> 01:03:45,680 Speaker 1: the world a better place. And I think if you 983 01:03:45,720 --> 01:03:48,440 Speaker 1: can make that argument convincing on you, you got a shot. 984 01:03:48,600 --> 01:03:52,120 Speaker 1: Do you personally have any anxiety about flying on a 985 01:03:52,160 --> 01:03:58,680 Speaker 1: seven seven back? No, because a variety of reasons. I mean, 986 01:03:58,720 --> 01:04:06,000 Speaker 1: I like, uh, tens of thousands of commercial planes take 987 01:04:06,040 --> 01:04:09,120 Speaker 1: off on land every day and almost none of them 988 01:04:09,120 --> 01:04:12,880 Speaker 1: ever crashed. So just by the law of numbers, uh, 989 01:04:13,640 --> 01:04:17,200 Speaker 1: I just like my chances. Um. It's also true that 990 01:04:17,680 --> 01:04:22,200 Speaker 1: the seven even Max has undergone a series of changes 991 01:04:22,280 --> 01:04:26,919 Speaker 1: and revisions and updates that have addressed the problem that 992 01:04:27,120 --> 01:04:32,200 Speaker 1: was responsible for those two crashes. So there's there's no 993 01:04:32,680 --> 01:04:36,400 Speaker 1: that you know, I shouldn't be speaking total declarative, but 994 01:04:36,440 --> 01:04:42,440 Speaker 1: there's almost a zero chance that that seem problem whatever encounter, 995 01:04:43,000 --> 01:04:45,960 Speaker 1: be encountered again. But more more broadly than that, I 996 01:04:46,120 --> 01:04:48,880 Speaker 1: just the law of big numbers suggest that you're very 997 01:04:49,000 --> 01:04:51,160 Speaker 1: very very very very unlikely to die in a commercial 998 01:04:51,280 --> 01:04:55,760 Speaker 1: erwle plane crash. Okay. Recently the New York Times had 999 01:04:55,800 --> 01:05:01,960 Speaker 1: a change in editorship. What has changed, uh, not a 1000 01:05:02,000 --> 01:05:05,840 Speaker 1: lot um. You know, Joe con who's our new executive editor, 1001 01:05:06,120 --> 01:05:11,040 Speaker 1: was an instrumental part of guiding the daily report for 1002 01:05:11,240 --> 01:05:15,040 Speaker 1: years now. He's a known quantity in the newsroom. I 1003 01:05:15,040 --> 01:05:20,200 Speaker 1: think his priorities are very avigned with those of Dean mackay. 1004 01:05:20,520 --> 01:05:23,040 Speaker 1: So I would not be the first to note that 1005 01:05:23,080 --> 01:05:26,440 Speaker 1: this is a pretty drama free succession at the New 1006 01:05:26,480 --> 01:05:28,560 Speaker 1: York Times, and I think that's a good thing for 1007 01:05:28,600 --> 01:05:32,520 Speaker 1: the paper. Well, many people have commented, and I've noticed 1008 01:05:32,560 --> 01:05:36,320 Speaker 1: myself as an avid Times reader, that certainly on the 1009 01:05:36,320 --> 01:05:40,480 Speaker 1: political front, there's I don't want to say a few 1010 01:05:40,560 --> 01:05:44,800 Speaker 1: or false equivalence us there's more reporting on the right 1011 01:05:45,680 --> 01:05:49,400 Speaker 1: and things that are troubling than they're used to be before. 1012 01:05:50,040 --> 01:05:54,360 Speaker 1: Is that something you feel at all? I guess I 1013 01:05:54,360 --> 01:05:58,800 Speaker 1: would dispute that conclusion. But I would also note that 1014 01:05:58,880 --> 01:06:01,760 Speaker 1: Joe has been executive editor for a matter of weeks, 1015 01:06:01,840 --> 01:06:06,520 Speaker 1: and that kind of reporting takes months and months to 1016 01:06:07,240 --> 01:06:12,920 Speaker 1: plan and deliver. So whatever changes people might have noticed 1017 01:06:12,920 --> 01:06:16,960 Speaker 1: on a particular way that we're covering something in the 1018 01:06:17,000 --> 01:06:20,240 Speaker 1: past couple of weeks is probably reflective of decisions that 1019 01:06:20,280 --> 01:06:23,840 Speaker 1: were made. Uh you know many months prior. How do 1020 01:06:23,880 --> 01:06:27,000 Speaker 1: you end up working in the New York Times? Uh? 1021 01:06:27,360 --> 01:06:29,560 Speaker 1: So someone just had a good quote about you know, 1022 01:06:29,720 --> 01:06:33,320 Speaker 1: luck is what is it? Luck is where opportunity meets 1023 01:06:33,880 --> 01:06:37,760 Speaker 1: hard work or something like that. So I feel lucky. UM. 1024 01:06:37,800 --> 01:06:40,440 Speaker 1: I also had good opportunities. But I also busted my 1025 01:06:40,480 --> 01:06:43,960 Speaker 1: butt for a long time. I was late to the 1026 01:06:44,000 --> 01:06:47,760 Speaker 1: journalism game. I was not part of my high school newspaper, 1027 01:06:47,880 --> 01:06:50,960 Speaker 1: my college newspaper. It was really in my early twenties 1028 01:06:51,000 --> 01:06:53,040 Speaker 1: when I got the journalism bug, and I was designing 1029 01:06:53,120 --> 01:06:59,040 Speaker 1: museum exhibitions at the time, doing nothing like reporting at all. Um, 1030 01:06:59,080 --> 01:07:00,760 Speaker 1: but I got the bug, and I went back to 1031 01:07:00,840 --> 01:07:05,880 Speaker 1: journalism school at Berkeley, and UM, I think a couple 1032 01:07:05,920 --> 01:07:08,680 Speaker 1: of things I had a really great professor, a couple 1033 01:07:08,640 --> 01:07:12,160 Speaker 1: of really great professors. I got a really great story 1034 01:07:12,240 --> 01:07:15,400 Speaker 1: early on that gave me a huge amount of confidence, 1035 01:07:15,720 --> 01:07:18,640 Speaker 1: um that I could really do this and and and 1036 01:07:18,680 --> 01:07:20,960 Speaker 1: make a go of it. And then I decided to 1037 01:07:21,000 --> 01:07:24,800 Speaker 1: focus on business reporting pretty early on, which was a 1038 01:07:24,920 --> 01:07:27,760 Speaker 1: strategic moved and one that that really has worked to 1039 01:07:28,240 --> 01:07:31,520 Speaker 1: in my advantage over the years. So why business reporting. 1040 01:07:32,280 --> 01:07:34,400 Speaker 1: I realized no one else was interested in it and 1041 01:07:34,440 --> 01:07:37,800 Speaker 1: I was, and that you know, that delta there was 1042 01:07:37,960 --> 01:07:41,400 Speaker 1: very compelling to me because I understood right away not 1043 01:07:41,480 --> 01:07:45,280 Speaker 1: only that there were huge stories in business right, businesses everything, 1044 01:07:45,640 --> 01:07:49,160 Speaker 1: they're huge stories here. It was super fascinating to me. 1045 01:07:49,760 --> 01:07:51,640 Speaker 1: It was where there was power. I could see that 1046 01:07:51,640 --> 01:07:54,160 Speaker 1: there was power there and and it was a way 1047 01:07:54,240 --> 01:07:57,520 Speaker 1: into reporting on powerful people. And the fact that I 1048 01:07:57,560 --> 01:08:00,520 Speaker 1: basically had it to myself among my ass at the 1049 01:08:00,560 --> 01:08:03,920 Speaker 1: business at the journalism school meant that it was pretty 1050 01:08:03,920 --> 01:08:06,280 Speaker 1: wide open. Uh. And then I also realized that there 1051 01:08:06,320 --> 01:08:08,600 Speaker 1: were jobs in it, and I didn't want to be like, 1052 01:08:09,160 --> 01:08:12,360 Speaker 1: you know, making sixteen thousand dollars a year right in 1053 01:08:12,680 --> 01:08:16,240 Speaker 1: features about street poets for the rest of my life. 1054 01:08:16,520 --> 01:08:18,439 Speaker 1: I wanted, like I was gonna do this, I wanted 1055 01:08:18,479 --> 01:08:22,720 Speaker 1: to have a real career. Okay. One of the criticisms 1056 01:08:22,840 --> 01:08:26,880 Speaker 1: of the New York Times is there's groupthink, and it's 1057 01:08:26,920 --> 01:08:30,320 Speaker 1: really like its own sports team, and you don't really 1058 01:08:30,360 --> 01:08:33,800 Speaker 1: want to be too much of a star, go too 1059 01:08:33,840 --> 01:08:37,680 Speaker 1: far out, maybe hurt the team. To what degree do 1060 01:08:37,800 --> 01:08:41,519 Speaker 1: you feel pressure to fall in line with the team 1061 01:08:41,520 --> 01:08:44,320 Speaker 1: in general or be fearful that you raise your head 1062 01:08:44,520 --> 01:08:47,680 Speaker 1: and do something might piss people off. I don't even 1063 01:08:47,720 --> 01:08:49,840 Speaker 1: know what you're talking about. Give me an example. Okay, Well, 1064 01:08:49,880 --> 01:08:52,360 Speaker 1: you know there was the whole Taylor Wren's thing that 1065 01:08:52,439 --> 01:08:55,000 Speaker 1: people were blowing back. There was the very wise thing 1066 01:08:55,120 --> 01:08:57,880 Speaker 1: that people were blowing back. You know what people don't 1067 01:08:57,960 --> 01:09:02,760 Speaker 1: realize is these newspapers. This tends to be people who 1068 01:09:02,800 --> 01:09:06,920 Speaker 1: see this as a lifelong career, and their employers are 1069 01:09:07,120 --> 01:09:13,120 Speaker 1: these giant institutions, writing books individually, etcetera. Something completely different. 1070 01:09:13,840 --> 01:09:19,440 Speaker 1: So such that people end up becoming even though they're individuals, 1071 01:09:20,160 --> 01:09:23,720 Speaker 1: they're part of the group, and then therefore they can 1072 01:09:23,760 --> 01:09:26,360 Speaker 1: react to another person in the group maybe having too 1073 01:09:26,479 --> 01:09:29,840 Speaker 1: much success or doing something that pisces them off. We 1074 01:09:29,880 --> 01:09:32,040 Speaker 1: had a certain thing to happen at the Washington Post. 1075 01:09:32,320 --> 01:09:34,880 Speaker 1: You're in the belly of the beast. Is it just 1076 01:09:35,080 --> 01:09:39,120 Speaker 1: calm or can you feel these things? All? Right? I'm 1077 01:09:39,120 --> 01:09:44,000 Speaker 1: gonna back up. Uh, I'm an employee of a for 1078 01:09:44,120 --> 01:09:49,880 Speaker 1: profit corporation. They pay me to do a job. My 1079 01:09:50,160 --> 01:09:54,040 Speaker 1: responsibility is to do my job really well as well 1080 01:09:54,080 --> 01:09:57,519 Speaker 1: as I can for my organization. So that's how I like. 1081 01:09:57,640 --> 01:10:01,280 Speaker 1: That's the fundamental level that which I understand my relationship 1082 01:10:01,320 --> 01:10:03,240 Speaker 1: with The New York Times. I get paid to do 1083 01:10:03,280 --> 01:10:06,080 Speaker 1: a job. You said, like I you know, a lot 1084 01:10:06,120 --> 01:10:08,719 Speaker 1: of people see it as a life on career. I don't. 1085 01:10:08,760 --> 01:10:13,599 Speaker 1: I won't necessarily accept that as a as uh as 1086 01:10:13,640 --> 01:10:15,559 Speaker 1: the way I think about my time at the times, 1087 01:10:15,560 --> 01:10:18,120 Speaker 1: I'm super grateful I've been here for nine years. I'm 1088 01:10:18,160 --> 01:10:20,120 Speaker 1: in no rush to leave. I have no plans to leave. 1089 01:10:20,400 --> 01:10:22,439 Speaker 1: But I also don't necessarily think it's the only job 1090 01:10:22,479 --> 01:10:24,240 Speaker 1: I'll ever have in my life. I think as some 1091 01:10:24,320 --> 01:10:26,960 Speaker 1: people might feel that way, sure, but it's not necessarily 1092 01:10:27,000 --> 01:10:30,880 Speaker 1: how I think about it. In terms of interpersonal dynamics, 1093 01:10:31,439 --> 01:10:34,000 Speaker 1: I don't think it's different than any other organization. If 1094 01:10:34,400 --> 01:10:37,640 Speaker 1: you and I'm not speaking about any specific incident or 1095 01:10:37,680 --> 01:10:40,240 Speaker 1: any of the ones you just mentioned, but if you 1096 01:10:40,760 --> 01:10:48,360 Speaker 1: work at PepsiCo and you publicly are talking shit about 1097 01:10:48,360 --> 01:10:52,680 Speaker 1: your colleagues or probably be repercussions if you're on a 1098 01:10:52,720 --> 01:10:56,240 Speaker 1: sports team and you go to the press conference after 1099 01:10:56,280 --> 01:10:58,559 Speaker 1: a loss and say, you know, like you know, if 1100 01:10:58,560 --> 01:11:00,920 Speaker 1: you're Katie and Katie is like Kyrie was a piece 1101 01:11:00,920 --> 01:11:02,920 Speaker 1: of ship, like he's you know, such and such and 1102 01:11:02,960 --> 01:11:06,320 Speaker 1: such and such and goes off on your teammate, there 1103 01:11:06,400 --> 01:11:11,080 Speaker 1: might be consequences. So the do It's no doubt about it. 1104 01:11:11,640 --> 01:11:13,880 Speaker 1: Institutions like the New York Times get a huge amount 1105 01:11:13,920 --> 01:11:17,559 Speaker 1: of scrutiny, But I don't necessarily believe that there is 1106 01:11:17,720 --> 01:11:21,479 Speaker 1: a you know something some like weird magic sauce about 1107 01:11:22,000 --> 01:11:28,160 Speaker 1: the a newspapers culture um in terms of can I 1108 01:11:28,200 --> 01:11:31,639 Speaker 1: feel like, of course, you know, like when when big 1109 01:11:31,720 --> 01:11:36,599 Speaker 1: things royal and organization, the individuals of that organization, whether 1110 01:11:36,640 --> 01:11:38,840 Speaker 1: there or not, they're directly a part of it, They 1111 01:11:38,880 --> 01:11:42,960 Speaker 1: notice it, they feel it. And so again I what 1112 01:11:43,040 --> 01:11:45,240 Speaker 1: I alluded to earlier when we talked about the new 1113 01:11:45,280 --> 01:11:49,720 Speaker 1: executive editor Pertains here too write like things are pretty 1114 01:11:49,760 --> 01:11:52,960 Speaker 1: calm at the New York Times right now, internally, at 1115 01:11:53,040 --> 01:11:55,680 Speaker 1: least for me at least what I'm seeing and for 1116 01:11:55,720 --> 01:11:57,920 Speaker 1: the most part, that's good, and I think it's reflective 1117 01:11:58,240 --> 01:12:02,639 Speaker 1: of a healthy culture where reporters by and large are 1118 01:12:02,640 --> 01:12:04,639 Speaker 1: focused on doing the work, which is what they pay 1119 01:12:04,720 --> 01:12:09,360 Speaker 1: us for. Okay, you beat recently changed to the climate. 1120 01:12:09,720 --> 01:12:12,640 Speaker 1: How did that happen? I won't borroy you with the 1121 01:12:12,640 --> 01:12:14,720 Speaker 1: whole way it happened, but what I'll say is that 1122 01:12:14,840 --> 01:12:17,479 Speaker 1: I have been on the business desk for the better 1123 01:12:17,520 --> 01:12:20,920 Speaker 1: part of nine years at the paper, and I've done 1124 01:12:20,920 --> 01:12:23,880 Speaker 1: all sorts of different things than the business desk. And 1125 01:12:24,520 --> 01:12:26,240 Speaker 1: I was at a place and the paper was at 1126 01:12:26,240 --> 01:12:30,400 Speaker 1: a place where we realized there was the opportunity for 1127 01:12:30,439 --> 01:12:35,120 Speaker 1: me to do uh, sort of refocus my energies, and 1128 01:12:35,200 --> 01:12:39,040 Speaker 1: the way to do that while capitalizing on all my 1129 01:12:39,120 --> 01:12:43,320 Speaker 1: experience reporting on business, all my connections in the business 1130 01:12:43,360 --> 01:12:46,920 Speaker 1: world and get me focused on the topic I'm really 1131 01:12:46,960 --> 01:12:51,160 Speaker 1: excited about, was to essentially move me from the business 1132 01:12:51,200 --> 01:12:53,760 Speaker 1: desk to the climate desk. But I'm still I'm still 1133 01:12:53,800 --> 01:12:56,600 Speaker 1: writing about business, so my focus is on the intersection 1134 01:12:57,160 --> 01:13:00,840 Speaker 1: of the business world and public see and that's a 1135 01:13:00,920 --> 01:13:04,400 Speaker 1: that's a big overlap. But I'm still very much reporting 1136 01:13:04,439 --> 01:13:07,200 Speaker 1: on the business world, um, though very much through the 1137 01:13:07,200 --> 01:13:13,040 Speaker 1: lions of climate change and particularly the energy transition. Okay, 1138 01:13:13,080 --> 01:13:17,840 Speaker 1: so what's going on? Give us a snapshot. Well, the 1139 01:13:17,920 --> 01:13:23,080 Speaker 1: humanity has been burning fossil fuels relentlessly for the past 1140 01:13:24,720 --> 01:13:27,280 Speaker 1: fifty years, depending when you start counting it, and it's 1141 01:13:27,680 --> 01:13:32,280 Speaker 1: dramatically changed the climate of the Earth in ways that 1142 01:13:32,439 --> 01:13:40,479 Speaker 1: are creating exponentially more destructive and severe weather events, and 1143 01:13:41,000 --> 01:13:45,559 Speaker 1: that are starting to affect and endanger and jeopardize not 1144 01:13:45,680 --> 01:13:49,400 Speaker 1: only you know, many millions of humans, um, but many 1145 01:13:49,439 --> 01:13:52,559 Speaker 1: other parts of the ecosystem as well. And while there 1146 01:13:52,600 --> 01:13:59,519 Speaker 1: has been decades of scientific consensus UH making clear the 1147 01:13:59,600 --> 01:14:02,760 Speaker 1: impair wative to stop burning fossil fuels, we as a 1148 01:14:02,840 --> 01:14:05,679 Speaker 1: human society have not done a very good job following 1149 01:14:05,720 --> 01:14:08,840 Speaker 1: the advice of our scientists, and on balance, we are 1150 01:14:08,840 --> 01:14:12,479 Speaker 1: still headed in the wrong direction. Needles say, there's two 1151 01:14:12,520 --> 01:14:17,160 Speaker 1: sides here. There's climate deniers their corporations that have an 1152 01:14:17,160 --> 01:14:21,879 Speaker 1: investment in burning UH fossil fuels. So to what degree 1153 01:14:22,000 --> 01:14:24,479 Speaker 1: do you feel you're preaching to the converted? How do 1154 01:14:24,520 --> 01:14:30,080 Speaker 1: you penetrate the minds of people who could make better decisions, 1155 01:14:30,080 --> 01:14:34,519 Speaker 1: whether to be corporations or people who believe otherwise? Yeah, 1156 01:14:34,560 --> 01:14:36,840 Speaker 1: I don't, I don't, Again, Bob, I don't see that 1157 01:14:36,880 --> 01:14:42,120 Speaker 1: as my job, right, Like, my mandate isn't to convert people. Um. 1158 01:14:42,200 --> 01:14:45,000 Speaker 1: My mandate is to report on what's happening and be 1159 01:14:45,080 --> 01:14:49,200 Speaker 1: as accurate as possible and try to find stories that 1160 01:14:49,280 --> 01:14:52,719 Speaker 1: help explain how we got here and where we're going. 1161 01:14:53,320 --> 01:14:57,960 Speaker 1: So I'm not in the business of of converting people. Um. 1162 01:14:58,000 --> 01:15:00,200 Speaker 1: You know, if that happens along the way, and and 1163 01:15:00,240 --> 01:15:03,719 Speaker 1: people who previously didn't believe in science believe in science 1164 01:15:03,760 --> 01:15:06,960 Speaker 1: as a result of my reporting, great, but that's that's 1165 01:15:06,960 --> 01:15:10,040 Speaker 1: not my remit. Okay, we're just getting a little deeper 1166 01:15:10,080 --> 01:15:13,640 Speaker 1: into the fact. We have the Supreme Court decision that 1167 01:15:13,960 --> 01:15:17,400 Speaker 1: ultimately neuter the e p A to a great degree. 1168 01:15:18,800 --> 01:15:22,439 Speaker 1: What's the landscape going forward? Well, I would, I would, 1169 01:15:23,439 --> 01:15:28,800 Speaker 1: I would dispute your characterization of that ruling of West Virginia. Uh. 1170 01:15:29,920 --> 01:15:33,760 Speaker 1: By all accounts it was it was not great for 1171 01:15:33,960 --> 01:15:36,400 Speaker 1: the power of the e p A to regulate the 1172 01:15:36,439 --> 01:15:40,000 Speaker 1: emissions of power plants in general, but it was not 1173 01:15:40,240 --> 01:15:48,040 Speaker 1: nearly as expansive of a ruling as some climate advocates feared. Um, 1174 01:15:48,120 --> 01:15:51,600 Speaker 1: So the e p A still does the have the 1175 01:15:51,640 --> 01:15:55,639 Speaker 1: ability to in to regulate the emissions of individual power plants. 1176 01:15:55,680 --> 01:15:58,920 Speaker 1: But but it makes it more complicated to regulate them 1177 01:15:58,960 --> 01:16:02,559 Speaker 1: as a group. All that is a roundabout way of 1178 01:16:02,640 --> 01:16:08,360 Speaker 1: saying that the Supreme Court is uh, well, the Supreme 1179 01:16:08,360 --> 01:16:11,960 Speaker 1: Court is and this decision is one of the ways 1180 01:16:11,960 --> 01:16:15,599 Speaker 1: in which the Biden administration has been essentially losing the 1181 01:16:15,640 --> 01:16:20,240 Speaker 1: tools it has as its disposal to reduce overall emissions 1182 01:16:20,240 --> 01:16:24,479 Speaker 1: in the United States, and the inability to pass Build 1183 01:16:24,479 --> 01:16:27,439 Speaker 1: Back Better was one of those. There are other issues 1184 01:16:27,680 --> 01:16:30,639 Speaker 1: going on that my my colleague Coral Davenport has reported 1185 01:16:30,640 --> 01:16:35,080 Speaker 1: on in depth. But the upshot is we as a 1186 01:16:35,200 --> 01:16:39,200 Speaker 1: nation and it's largely a result of the hyperpartisanship and 1187 01:16:39,240 --> 01:16:45,200 Speaker 1: as you said, a pretty clear partisan rift between how 1188 01:16:45,240 --> 01:16:49,160 Speaker 1: the different parties are approaching climate and energy issues. UM 1189 01:16:49,320 --> 01:16:53,479 Speaker 1: are not moving very quickly to reduce the United States 1190 01:16:53,560 --> 01:16:59,839 Speaker 1: is greenhouse gas emissions. And if one wanted to reduce those, 1191 01:17:00,400 --> 01:17:03,800 Speaker 1: we're the opportunities, well, there are many and I want 1192 01:17:03,800 --> 01:17:06,920 Speaker 1: to be careful here because I am not an expert, UM, 1193 01:17:06,960 --> 01:17:10,200 Speaker 1: but the Buildback Better plan and the reconciliation package that 1194 01:17:10,320 --> 01:17:13,200 Speaker 1: was on the table and that was essentially killed by 1195 01:17:13,360 --> 01:17:16,240 Speaker 1: Senator Mansion, who of course is from West Virginia and 1196 01:17:16,320 --> 01:17:21,559 Speaker 1: has business interests tied to the coal industry. Uh. That bill, 1197 01:17:21,600 --> 01:17:27,800 Speaker 1: that that package would have uh advocated huge sums of 1198 01:17:27,840 --> 01:17:32,759 Speaker 1: money towards essentially transitioning power generation in the United States 1199 01:17:32,760 --> 01:17:37,479 Speaker 1: to renewable energy. And that's that. That is not necessarily 1200 01:17:37,520 --> 01:17:40,400 Speaker 1: the number one way to reduce emissions, but it's one 1201 01:17:40,439 --> 01:17:43,679 Speaker 1: of the biggest, right, Like, let's stop using We don't 1202 01:17:43,720 --> 01:17:45,960 Speaker 1: use a whole lot of coal in this country anymore, um, 1203 01:17:46,040 --> 01:17:51,600 Speaker 1: but let's stop using natural gas. Uh. Let's for power generation. 1204 01:17:52,160 --> 01:17:55,320 Speaker 1: Let's stop using coal wherever it is still used. Uh. 1205 01:17:56,040 --> 01:18:00,839 Speaker 1: And let's start using more oil. Excuse me, more solar, 1206 01:18:01,240 --> 01:18:04,719 Speaker 1: more wind, uh, and more hydro electricity. These are renewable 1207 01:18:04,760 --> 01:18:09,040 Speaker 1: sources of energy that do not create new emissions. Okay, 1208 01:18:09,240 --> 01:18:12,840 Speaker 1: just on a very practical matter. You know, we've had COVID. 1209 01:18:12,920 --> 01:18:15,760 Speaker 1: Everything's a little bit crazy. Maybe we should go before that, 1210 01:18:16,520 --> 01:18:21,240 Speaker 1: to what degree do you go into the office every day? 1211 01:18:21,400 --> 01:18:25,400 Speaker 1: To what degree do you choose your own topics? Are 1212 01:18:25,439 --> 01:18:30,680 Speaker 1: they assigned? Do you write stuff specifically be printed? Do 1213 01:18:30,680 --> 01:18:33,840 Speaker 1: you write stuff? And they rejected? What's the whole process 1214 01:18:33,880 --> 01:18:37,360 Speaker 1: of the mechanics there? Well, I've been in the office 1215 01:18:37,439 --> 01:18:39,479 Speaker 1: more than most for the last year and a half 1216 01:18:39,560 --> 01:18:41,639 Speaker 1: or so I like the office, I like my desk, 1217 01:18:41,760 --> 01:18:44,720 Speaker 1: I like seeing people and talking to people. Um. But 1218 01:18:44,840 --> 01:18:48,040 Speaker 1: it's also the case that not I'm one of I'm 1219 01:18:48,080 --> 01:18:53,320 Speaker 1: in the minority still And so have you had COVID? Yes, 1220 01:18:53,400 --> 01:18:58,200 Speaker 1: I've had COVID twice as a matter of fact. Um uh. 1221 01:18:58,240 --> 01:19:00,400 Speaker 1: And I'm fortunate to still be said in here and 1222 01:19:00,720 --> 01:19:04,840 Speaker 1: and to not have any severe lasting impacts at least 1223 01:19:04,880 --> 01:19:08,680 Speaker 1: that I'm aware of right now, maybe in my brain. Um. 1224 01:19:08,720 --> 01:19:11,760 Speaker 1: But listen. As for the reporting process, um, it's a 1225 01:19:11,840 --> 01:19:16,160 Speaker 1: mix of writing stories that the editors have asked for 1226 01:19:16,439 --> 01:19:21,559 Speaker 1: and then working with them to identify targets that again 1227 01:19:21,640 --> 01:19:26,000 Speaker 1: sort of help us continue our mission of trying to 1228 01:19:26,040 --> 01:19:29,880 Speaker 1: write fact based stories that that helped explain where the climate, 1229 01:19:31,080 --> 01:19:34,680 Speaker 1: the situation is and what's what's to come. So I 1230 01:19:34,720 --> 01:19:37,120 Speaker 1: would say, on balance, you know, since I joined the 1231 01:19:37,120 --> 01:19:43,080 Speaker 1: Climate desk, most of my sort of biggest marquee pieces, 1232 01:19:43,160 --> 01:19:46,160 Speaker 1: you know, big investigative features those kind of things, have 1233 01:19:46,240 --> 01:19:48,800 Speaker 1: been ones I've come up with myself. I've got a 1234 01:19:48,840 --> 01:19:52,720 Speaker 1: good line of reporting I'm excited about, which was uh, 1235 01:19:53,000 --> 01:19:56,200 Speaker 1: you know, probably myself and another reporter sort of stumbled 1236 01:19:56,200 --> 01:19:58,240 Speaker 1: across some stuff, and I'm I'm picking it up and 1237 01:19:58,320 --> 01:20:00,479 Speaker 1: running with it. But it's all is the case. I 1238 01:20:00,479 --> 01:20:03,960 Speaker 1: wrote a news analysis story on Friday after the West 1239 01:20:04,040 --> 01:20:07,160 Speaker 1: Virginia ruling that was very much something the editors wanted 1240 01:20:07,200 --> 01:20:08,479 Speaker 1: to see and it was their idea. And I'm like, 1241 01:20:08,600 --> 01:20:10,479 Speaker 1: that's a good idea. I can turn that around in 1242 01:20:10,520 --> 01:20:20,280 Speaker 1: a day or so. And there wasn't the paper. Let's 1243 01:20:20,280 --> 01:20:24,519 Speaker 1: go back to the book. There was a review in 1244 01:20:24,560 --> 01:20:28,320 Speaker 1: the New York Times book review by Curdie Anderson which 1245 01:20:28,439 --> 01:20:34,920 Speaker 1: was more than relatively negative. Now the caveat here is 1246 01:20:35,000 --> 01:20:37,760 Speaker 1: he wrote a book which I would not call identical, 1247 01:20:37,840 --> 01:20:41,360 Speaker 1: but many people feel covered a similar subject. How do 1248 01:20:41,439 --> 01:20:45,920 Speaker 1: you feel about all that. I didn't write my book 1249 01:20:46,000 --> 01:20:49,360 Speaker 1: for book reviewers. Uh, And so I'll just leave it there. 1250 01:20:50,880 --> 01:20:53,599 Speaker 1: Let me put it in in a different way. The nature 1251 01:20:53,640 --> 01:20:57,360 Speaker 1: of being in the public eye is you get a 1252 01:20:57,400 --> 01:21:00,559 Speaker 1: lot of feedback. There are people who attack you just 1253 01:21:00,720 --> 01:21:04,160 Speaker 1: to attack you. So now that your level has been raised, 1254 01:21:04,160 --> 01:21:06,720 Speaker 1: your profile has been raised, what's that been like for you. 1255 01:21:08,520 --> 01:21:12,000 Speaker 1: I've been surprised how few people have really come at 1256 01:21:12,040 --> 01:21:15,160 Speaker 1: me and tried to argue with the premise of the book. Right, 1257 01:21:15,439 --> 01:21:21,360 Speaker 1: I make a make a pretty clear Uh, rhetorical argument 1258 01:21:21,520 --> 01:21:24,240 Speaker 1: in this book, which is that Jack o Elch bears 1259 01:21:24,280 --> 01:21:26,960 Speaker 1: singular responsibility for a lot of the problems we have 1260 01:21:27,040 --> 01:21:30,599 Speaker 1: in our society. Um. I have yet to see someone 1261 01:21:30,640 --> 01:21:33,280 Speaker 1: sort of take the other side of that debate in 1262 01:21:33,320 --> 01:21:38,960 Speaker 1: a really forceful way. Um ah. And that to me 1263 01:21:39,080 --> 01:21:42,320 Speaker 1: has been surprising. Even when Jeff you know, Jack's successor, 1264 01:21:42,840 --> 01:21:45,519 Speaker 1: came after me on LinkedIn, it was in this sort 1265 01:21:45,520 --> 01:21:47,880 Speaker 1: of limp way of saying, like Jack was actually a 1266 01:21:47,880 --> 01:21:51,960 Speaker 1: good manager, all right, Like no effort to to dispute 1267 01:21:52,040 --> 01:21:57,800 Speaker 1: the actual merits of my argument, okay, And that to me, Um, 1268 01:21:57,840 --> 01:22:01,360 Speaker 1: you know, I'm not saying I'm entirely right. I mean, 1269 01:22:01,360 --> 01:22:03,840 Speaker 1: I believe in my thesis. But but this is a 1270 01:22:03,880 --> 01:22:06,760 Speaker 1: book that was meant to start a conversation. And what 1271 01:22:06,840 --> 01:22:09,280 Speaker 1: I've been really gratified by is the fact that people 1272 01:22:09,360 --> 01:22:12,040 Speaker 1: want to have this conversation. And certainly not everyone agrees 1273 01:22:12,080 --> 01:22:16,360 Speaker 1: with me. Um. But what you said, honestly about what 1274 01:22:16,439 --> 01:22:19,160 Speaker 1: you said in in your newsletter is one of my 1275 01:22:19,280 --> 01:22:22,240 Speaker 1: favorite things. And it's a quote I'm using and I'm 1276 01:22:22,240 --> 01:22:24,599 Speaker 1: telling my marketing people to use. You said if everyone 1277 01:22:24,720 --> 01:22:26,960 Speaker 1: in America read this book, there would be a revolution. 1278 01:22:27,320 --> 01:22:29,920 Speaker 1: And I was God, God, damn, that's right, right, that's 1279 01:22:29,960 --> 01:22:33,240 Speaker 1: actually that was the intent. That was the spirit I 1280 01:22:33,280 --> 01:22:36,479 Speaker 1: was trying to provoke with this book. And the fact 1281 01:22:36,560 --> 01:22:39,360 Speaker 1: that you and others have responded to it to me, 1282 01:22:39,840 --> 01:22:43,120 Speaker 1: UM suggests that at least you know, that effort to 1283 01:22:43,240 --> 01:22:46,639 Speaker 1: spark a conversation, to get us talking about these big 1284 01:22:46,680 --> 01:22:49,360 Speaker 1: issues and how we can live in a in a 1285 01:22:49,479 --> 01:22:52,840 Speaker 1: society that works for more people. Um, was was at 1286 01:22:52,880 --> 01:22:58,560 Speaker 1: least somewhat successful. And commercially is the book met your expectations? 1287 01:22:58,640 --> 01:23:02,600 Speaker 1: Exceeded them? Disappoint did you? Yeah? Exceeded? Uh? It was 1288 01:23:02,640 --> 01:23:06,639 Speaker 1: a hit, um. And I I was a nervous author 1289 01:23:06,880 --> 01:23:11,519 Speaker 1: right the the in the days and months and weeks 1290 01:23:11,560 --> 01:23:14,280 Speaker 1: before we knew how this book was doing, and I 1291 01:23:14,360 --> 01:23:18,120 Speaker 1: was haveing, I was deeply nervous. But listen. It debuted 1292 01:23:18,160 --> 01:23:19,960 Speaker 1: on the New York Times bestseller List, It was on 1293 01:23:19,960 --> 01:23:22,599 Speaker 1: the Wall Street Journal best seller list. It hit number 1294 01:23:22,680 --> 01:23:26,519 Speaker 1: twenty eight in all books on Amazon. Uh. It's gotten 1295 01:23:26,560 --> 01:23:30,280 Speaker 1: a huge amount of press coverage. UM. I will note 1296 01:23:30,840 --> 01:23:34,080 Speaker 1: almost all of it favorable, with a few notable exceptions 1297 01:23:34,120 --> 01:23:37,320 Speaker 1: which I can take my lumps on and keep keep 1298 01:23:37,360 --> 01:23:42,479 Speaker 1: marching forward. And uh and yeah, and like people are 1299 01:23:42,479 --> 01:23:45,280 Speaker 1: talking about this, and that that to me was like, 1300 01:23:45,320 --> 01:23:47,360 Speaker 1: if people want to talk about this, and if it 1301 01:23:47,439 --> 01:23:50,760 Speaker 1: gets if it fires people up, you know, whether they 1302 01:23:50,760 --> 01:23:53,760 Speaker 1: get piste off about it or not, I'm fine, Um, 1303 01:23:53,840 --> 01:23:55,680 Speaker 1: as long as they're sort of having the argument in 1304 01:23:55,720 --> 01:23:59,759 Speaker 1: good faith. Uh, that's gravy to me. I hope people 1305 01:23:59,800 --> 01:24:02,679 Speaker 1: just agree with it, right, Like, if if it's not Jack, 1306 01:24:03,120 --> 01:24:05,639 Speaker 1: tell me who it is, Tell me how we got here? 1307 01:24:05,960 --> 01:24:08,920 Speaker 1: Tell me what's wrong with our society that this? You know, 1308 01:24:09,000 --> 01:24:12,879 Speaker 1: CEO has makes six times with the medium employee works 1309 01:24:14,240 --> 01:24:17,120 Speaker 1: makes and and then it takes like three jobs for 1310 01:24:17,360 --> 01:24:20,360 Speaker 1: a low income family to keep food on the table, right, Like, 1311 01:24:22,040 --> 01:24:24,759 Speaker 1: how did we get here in the world today? There's 1312 01:24:24,880 --> 01:24:28,960 Speaker 1: so many messages. You've had a successful book, What is 1313 01:24:29,040 --> 01:24:33,120 Speaker 1: the key to getting the message out? I had a 1314 01:24:33,120 --> 01:24:35,600 Speaker 1: great team. I'm not I'm not b S and you. 1315 01:24:35,800 --> 01:24:38,559 Speaker 1: I have good marketing people at Simon and Schuster who 1316 01:24:38,600 --> 01:24:43,080 Speaker 1: who did humans work? Um? And I was very engaged 1317 01:24:43,120 --> 01:24:45,439 Speaker 1: in it as well. I tried real hard to get 1318 01:24:45,439 --> 01:24:49,559 Speaker 1: people to buy this book. I didn't just write it. UM. 1319 01:24:49,600 --> 01:24:52,800 Speaker 1: So there's some hustle involved, for sure, But I think 1320 01:24:52,840 --> 01:24:54,400 Speaker 1: at the end of the day, you have to have 1321 01:24:54,720 --> 01:24:58,519 Speaker 1: a really crystalline idea that people want to talk about, 1322 01:24:58,720 --> 01:25:00,800 Speaker 1: and and I was I did know if this was 1323 01:25:00,840 --> 01:25:02,760 Speaker 1: going to be one of those, but but clearly it 1324 01:25:02,800 --> 01:25:06,080 Speaker 1: has been, and it's it's helped me, you know, if 1325 01:25:06,120 --> 01:25:08,360 Speaker 1: I if I ever write another book, I think I've 1326 01:25:08,439 --> 01:25:10,680 Speaker 1: learned things through this process that have really made me 1327 01:25:10,720 --> 01:25:14,360 Speaker 1: realize what what what some of these successful elements of 1328 01:25:14,439 --> 01:25:17,200 Speaker 1: a book launch would be. And I think number one 1329 01:25:17,280 --> 01:25:20,160 Speaker 1: is like, can you can you stay in a sentence 1330 01:25:20,200 --> 01:25:23,080 Speaker 1: what your idea is and does that sentence want to 1331 01:25:23,080 --> 01:25:27,479 Speaker 1: make people keep talking? Okay? In the actual process of 1332 01:25:27,520 --> 01:25:30,960 Speaker 1: writing the book, did you take time off from the 1333 01:25:31,040 --> 01:25:33,160 Speaker 1: times you write in your spirit time? How did you 1334 01:25:33,200 --> 01:25:35,240 Speaker 1: do it? I didn't take time off. I did in 1335 01:25:35,280 --> 01:25:39,800 Speaker 1: my spare time. It was incredibly incredibly quick process. UM. 1336 01:25:39,840 --> 01:25:43,080 Speaker 1: I had the idea for the book in April of so, 1337 01:25:43,200 --> 01:25:46,920 Speaker 1: just over two years ago. I wrote the proposal UM 1338 01:25:47,000 --> 01:25:51,720 Speaker 1: in August of so, less than two years ago. I 1339 01:25:51,720 --> 01:25:56,960 Speaker 1: didn't sign a contract until October November, so now we're 1340 01:25:56,960 --> 01:26:00,240 Speaker 1: talking like eighteen months ago. And then I crashed this 1341 01:26:00,320 --> 01:26:03,160 Speaker 1: thing in a in a year or so, which is 1342 01:26:03,200 --> 01:26:08,479 Speaker 1: an absurd timeline for a book. Uh So, I my 1343 01:26:08,520 --> 01:26:10,920 Speaker 1: wife gets lots of thanks for bearing with mean and 1344 01:26:11,000 --> 01:26:15,240 Speaker 1: helping take care of our kids. Well, I spent time 1345 01:26:15,240 --> 01:26:18,519 Speaker 1: writing this book. Well, thanks for taking the time to 1346 01:26:18,600 --> 01:26:22,679 Speaker 1: talk to us here, David. Really fascinating. I'm sure everybody 1347 01:26:22,680 --> 01:26:25,240 Speaker 1: will be stimulated. I've already gotten a ton of email 1348 01:26:25,280 --> 01:26:27,800 Speaker 1: people bought and read the book. I'm sure now even 1349 01:26:27,840 --> 01:26:31,040 Speaker 1: more people will. So thanks for writing the book. Because 1350 01:26:31,040 --> 01:26:32,840 Speaker 1: someone had to write the truth. That's why I had 1351 01:26:32,840 --> 01:26:36,120 Speaker 1: to get it immediately said, someone is speaking the truth 1352 01:26:36,200 --> 01:26:40,519 Speaker 1: about Jack Welch, which was sitting there in plain sight. 1353 01:26:41,479 --> 01:26:44,240 Speaker 1: So in any event, thanks so much for taking the time. 1354 01:26:44,720 --> 01:26:47,519 Speaker 1: Thank you so much, Bob, and you you literally gave 1355 01:26:47,560 --> 01:26:51,040 Speaker 1: me my favorite quote, my favorite blurb of this whole cycle, 1356 01:26:51,080 --> 01:26:55,599 Speaker 1: and I'll never forget it. Wow, that's great. Until next time. 1357 01:26:55,760 --> 01:27:13,679 Speaker 1: This is Bob Lefts