Politically, I don't... Have you ever seen a president like this who has enriched himself?
There's only one person that has done this. That's Donald Trump. But there are probably five or six others that did things that were inappropriate in that office. Unfortunately, it's human nature. But what Trump did should send alarm bells to people. And Trump, you know, will tell his people privately, 'Oh, look at these dummies. They could have made a couple billion dollars themselves, too, but they're just not as smart as me.'
Anthony Scaramucci, I'm so happy to see you. Congratulations on your new book, All the Wrong Moves: How Three Catastrophic Decisions Led to the Rise of Trump. We are going to talk all about this book. But first off, how is life? It's like Mooch 2.0.
Well, listen, I think like, well, you know, I feel like it's Mooch 2.0 in the media, but I sort of just still probably Mooch 0.0 actually. I'm still the same person, you know, but I got rocked after I got fired from the White House. Let's face it. I mean, that was a rough time for me. It was a rough time for my family. But I think what I tell people is when you're going through a rough time, you have to keep going. And so I've sort of done that. It's nine years, if you could believe this, Katie, since I was fired from the White House.
I can't believe it. Gosh, where does time...
Trump is still with us. He looms over us, you know, for the last nine years, you know.
Take us back to that time when you got fired. I mean, how challenging was that? And how you said your world was rocked. How rocked was it?
Well, I think it would be important to just say that I had a series of mistakes and miscalculations prior to my arrival in the White House and then catastrophic 11 days in the White House, which led to my ejection. But let me just set the scene for you. I was a political fundraiser. I know your first husband, grew up in Manassas. So for people that are listening, I'm from Port Washington, which is a neighboring town. That area was controlled by the Republican party when I was a kid. And my father was a union member. He was a crane operator. And so he had a union card, but he was a lifelong Republican. So when I registered to vote, I was a Republican. And you know, garden variety centrist Republican in the spirit of Nelson Rockefeller.
When I came out of school, I had a job at Goldman Sachs as a private banker, but I had no connections, Katie. And so, one of the ways, I mean, I can't hit a golf ball. I can't hit a, you know, tennis ball. I just didn't grow up with that. And so, one of the ways to meet people was through political fundraisers. So, I went to Rudy Giuliani's first fundraiser as a young Republican for Rudy. This is before Rudy went crazy, okay? But this is 1989. He lost. And then I became a political fundraiser for him. He won. That gave me a lot of access to him. It's important to tell that part of the story because I was a garden variety political fundraiser for Republicans and these were mostly centrist candidates. And so I was with Jeb Bush when he got knocked out of the race and then I got recruited by Donald Trump. So lightning mistake number one went to go work for Donald Trump. My wife Deidre was like, 'Don't do that.'
He starts winning. We start building a, you know, movement. He wins the presidency. I'm now named to the executive transition team. Mistake number two, I should have never accepted that position. And then the third mistake, which obviously was the big colossal one, he called me, you know, I had a negative opinion of Steve Bannon and Reince Priebus. I'm sure they had a negative opinion of me. I shared that with Trump. He called me in June of 2017 and said, 'Hey, I think you were right about these guys. Would you like to come down here and help me?' Okay. And this is where your ego and your pride goes crazy, Katie. And this is a big lesson for people listening. You can't put your pride and your ego into your decision-making. So, my mentor who's about 10, 15 years older than me told me, 'Don't do it.'
Uh, bad decision. You and Trump in a situation like that inside the White House were very bad. You're very different personality-wise. It's one thing to be on the campaign as a volunteer. Do not do it.
Uh well, I'm going to mention his name.
This is the third time I asked you, so I have a feeling you don't want to tell me.
He's going to be mad at me, but his name is Vinnie Viola. He was the chairman now, Veru. He was the president of the Chicago Mercantile exchanges. He was best friends with Dick Grasso and Ken Langone. These are like three of my mentors. I acknowledge all three of them in the book, by the way. These are three of my big mentors that helped me on Wall Street. But Vinnie told me, 'Don't do it. Get your ego in the right place.' Say, 'No, I did not have my ego in the right place.' And I think this is a cautionary tale to all of your viewers and listeners. You got to be very careful with your ego in your personal relationships, your business relationships, your ambition. But I had in my head, blue-collar kid, went to Tufts and Harvard Law School, worked at Goldman, built two successful hedge funds. Oh, now I'm going to make a difference for the American president. And it was a mistake. You know, that's what I call Potomac fever, right? You think you're going to do something that you're really not capable of. Deidre told me not to do it. We were fighting. I did it anyway. She ended up filing for divorce. While I was down there, I mean maybe a week before she filed for divorce. I missed the birth of my son, which people don't remember, but I'll share with your viewers and listeners. The 24th of July 2017. My son James was born here in New York at the Presbyterian Hospital, but I was down at the Boy Scouts event with Donald Trump in Western Virginia. Deidre and I were already fighting, but I probably could have still attended the birth. She was due on August 8th. She came early, probably related to the stress. So that I have to also be accountable for. But that plane, the Air Force One, landed 35 miles away from the campsite. We had a 35-mile drive into the camp, into the forest. There's a 60-mile no-fly zone around the president's plane. There was no way for me to get back to New York. Even if I chartered a private plane, I was never getting back to New York. So, my wife had filed for divorce on me. I missed the birth of my son. 11 days after I was hired, I was ceremoniously fired, which was painful. I then got lit up like all the late night comedians. I mean, some of the jokes were actually really funny. I thought you in retrospect.
But I enjoy this stuff. It didn't bother me. I think Bill Hader played me on Saturday Night Live. I ran into, you know, Lorne Michaels at the Yankee game a few weeks after. I was like, that's the best we could do. I mean, you couldn't bring Brad Pitt in like for a guest appearance. I mean, I get stuck with Bill Hader, you know? I mean, and Lorne's cool. I mean, he invited actually so funny about how things work. I said to Lorne, I said, 'Hey, you can make fun of me all you want, but is there any chance I can go to the Christmas show and bring some of my kids?' And he said, 'Of course.' And so I did. And they lambasted me at that as well. So, I had to take the punches there. But, you know, at the end of the day, I mean, I was called a Jersey Shore cast member. I was called Tony Soprano on the Potomac. I don't know how you could be a Jersey Shore cast member and Tony at the same time. They sort of don't jive with each other, but that's okay.
They're loosely related, I think.
I think so. But look, I could take the punches, Katie. So, I got hit every which way. But when I returned to New York, I mean, Deidre and I, I love Deidre. Obviously, she loves me, otherwise she wouldn't still be with me. We reconciled our marriage. I've been generally forgiven for missing the birth of James. Although, I can tell you I won't miss another one of his birthdays as long as I'm standing. I went back and faced the music. Do you remember Howard Bragman? Of course I loved Howard Bragman.
Okay. So Howard Bragman is somebody I love and adore.
We should tell people who he is.
Okay. So Howard Bragman is a PR person who passed a few years ago. He had leukemia.
Los Angeles based. He was a crisis communications maven. And so somebody said to me, 'You got to call Howard Bragman. You're in a terrible ditch. He'll help you dig out of the ditch.' And you know, I just interviewed Howard's husband, his widower, I guess you would say, and we had a good time talking about Howard.
Howard said to me, and I'm going to talk like Howard if you guys don't mind. 'This is a disaster. The disaster. You don't go anywhere near the media. You're a pretty wealthy guy. Go buy yourself a villa in Tuscany and disappear for 5 years.' Literally what the guy said to me. Okay. He said, 'Come back in like 2022.' I'm like, 'Howard, I'm not doing that.' Okay, I didn't hire you for your advice. I hired you for your Rolodex. Give me Steven Coakley's number. Give me Bill Maher's number. I went, I got on George Stephanopoulos. I went on, I went on...
Face the music. I'm not going to sit there like a big baby. I'm not going to play the victim. And you know, Howard and I became very, very close. I always teased him about that advice. He always said to me, 'You were like a unicorn. There's no other person that could have pulled that off, you know.' But I went to Israel with Howard and said Kaddish for his mom in the tomb of Rebecca. I mean, that's how close Howard and I became. So, I was very sad when he passed. But he helped me out because of his Rolodex. He did not help me out because of his advice. And I used to always tease him about that. But we became very, very close friends. And it's a big message for people. You know, if you have a mistake, you're doing something that's a disaster, dig yourself out of it by owning it. Don't pretend that it didn't happen and don't hide, you know.
Which is good advice. And do you remember, like I'm trying to remember, I remember you coming and going in the span of 11 days right at the White House. Yeah. But talk about why you got the axe and how it went down just to remind people.
So the reporting on it was, you know, sometimes as you know, is somewhat inaccurate. So the reporters claimed and the White House sort of put out the story, I got the axe because I gave a what I thought was off the record to a New Yorker reporter. It's actually somebody I grew up on Long Island with me. I knew the family forever. I definitely thought it was off the record. He said it wasn't. He of course taped me. It was a one-party state, blah blah. And so he wrote the article and people say that that's the reason I got fired. Trump, if you know Trump, I mean, I said some very funny things in the article. It's probably not appropriate. I don't know. Is this a PG-13 podcast? Oh, this is an R-rated podcast.
So, I said, you know, I said Steve Bannon was like committing auto-fellatio in his office. I didn't probably say it like that. Said it more like a New Yorker would say it, you know, more graphically than that.
And which was literally one of the funniest things that probably ever came out of the West Wing. And Trump loved it. So, if you know Trump, and I know you know him, he thought it was funny. He didn't give a damn about that. What got me in trouble with Trump is on Friday morning, and I was only there for two Fridays, so I remember it was second Friday, okay? I'm in the cabinet room with him, and he wants to veto the Russian sanctions bill. And I said, 'Don't do it.' But I said it pretty plaintively. You know, there were a few other people. There were a few other cabinet people there. Wasn't a cabinet meeting, but there was like three or four of us in the room. And he said, 'What do you mean don't do it? I'm the president of the United States. I can do whatever I want.' And I said it to him in a way like we were business associates in a lateral relationship, not a subordinate, right, subordinate relationship. I said, 'Well, if you do it, you've only been here six months as president. Your team passed it. Ryan passed it in the House. McConnell passed it in the Senate. And they're going to teach you the lesson. They're going to go to Schumer. They're going to get the 17 votes they need to override your veto.' And he looked at me said, 'I'm the president. They can't override my veto.' And I looked at him, I said, 'Well, they can.' And I think that's what really got me in trouble because he did not like the...
Was he embarrassed because it was in front of these other people?
I think so. Right. And that's eighth grade social studies, right? That you can have the override, right? So, he didn't really get it and he got mad at me because I said it in front of a few other people. And then Jared Kushner called me and said, 'Hey, you can't talk to him like that. You can't tell him stuff he doesn't know in front of other people. You got to do that either quietly or he gets upset.' Like listen, I and McMaster, if you ever interview him, he can tell you the story if he's willing to. I'm in the Oval with McMaster and he's trying to explain to Trump the difference between a Shia and a Sunni. And he went crazy, you know, because he doesn't want to be lectured to. He doesn't want anybody to tell him.
He also doesn't want to be exposed for not knowing things. He doesn't want his ignorance exposed. Right.
And by the way, I'm smarter than my generals. I'm smarter than you. I'm smarter than this person. And so, of course, I know everything. And so, he tries to steamroll you with the bullying as opposed to sitting there. A more confident person would be like, 'Hey, you know, tell me what the difference is.' But not him, right? And one of the best days and Maggie Haberman wrote about this in Confidence Men was after he had won the presidency, Mike Bloomberg called him and you know Mike was pretty tough on him at the Democratic convention in 2016 but Mike graciously called him and said, 'Hey, you know, Mr. President-elect, congratulations.' 'Oh, you were rough on me, Mike.' You know, blah blah. And they finished the call by saying, 'Well, I wish you a lot of luck and just do your very best to hire the smartest people that you can, you know, people smarter than you even.' And Trump said, 'Well, that's going to be impossible because there's nobody smarter than me.' And that's everything you need to know. And, you know, he said it and it was verified by three or four people and Maggie wrote about it in her book. And that's him. And so, Jared said to me, 'We're getting on Air Force One and we were flying to Long Island for this MS-13, this gang out on Long Island.' He was giving a speech.
And Jared said to me, 'Well, if you make it through the weekend, you're probably not getting fired, but I'm pretty sure you're getting fired.' And so, I did make it through the weekend. But can I tell everybody how I knew I got fired? Is that okay?
So, I woke up, it was 6:30 in the morning, and it was a Monday, and I was flying back to... I woke up at 4:30, but I was on a 6:30 flight back to DC because I had flown up to Long Island with Air Force One. I stayed there for the weekend and I flew back.
So, you could see your family.
See my family and stuff like that. Yeah. I was still working, you know, I had my laptop and everything.
Well, I did do that as well. And I did do that as well. I saw the baby on Friday and it was a disaster, Katie. I mean, I've done stupid things in my life, but the whole way this thing went down was a disaster. So, went back, turned on the phone. The White House issue, we always called it like the bat phone. It's like this heavily encrypted iPhone. This way you can't get hacked or someone can't listen into it and things like that, you know, because you got all kinds of spies roaming around in Washington. And so I had this like very special iPhone. I turned it on. Your instructions from the national security guys were if you're going to talk to the president, Vice President Pence, anybody in the cabinet, use the bat phone. If you're going to text people and things like that. So I turned it on. I had a meeting with Vice President Pence scheduled for 8:00. So I turned it on to make sure the meeting was still on. And I couldn't get a text message in or out of the phone. And the phone wasn't working. So, they cut my air supply. So, by six o'clock in the morning, I knew I was fired, right? I was just waiting for the axe to fall.
And so, when did you get confirmation?
So, I got fired at like 9:30 by General Kelly. He brought me into the... he was the new White House chief of staff. His first official act was to fire me. I mean, Trump is like a big baby, right? He couldn't fire me himself because he's a big conflict avoider. So, he made General Kelly fire me. And I said, 'Okay, no problem.' You know, I said, 'John, I want to be close to you. You know, when this is over, let's go have lunch.' And we've become very close friends. John, Karen, me and Deidre, you know, I give money to the Marine Scholarship Foundation. And...
John Kelly regrets, he has a few.
He does. Well, we all do. I mean, well, not all of us. The ones that want to own it and want to be truthful to you. There are people that do have regrets, Katie, that will never join your show and admit them. There'll be people that for the rest of their lives they'll quiver over and pretend that they don't have regrets, you know, but most people that are honest will tell you that they regretted working for him, you know. It's just one of those things. And he crushes people. I mean, look what he did to Pompeo. Look what he did to Pence. Look what he's about to do to Vance and Rubio. I mean, he's just a human wood chipper, you know? You go in there, you get yourself chipped up. But we all do it for the same reason. You know, we have our own pathologies. We do it because we think it's for Boy Scouts. That's one reason. We do it for power and significance. You want to be in the motorcade. We do it because you think you're going to have a positive, hopefully a positive influence. There's a multitude of different reasons that you do it, but there should also be reasons that you don't do it. And one of those is, you know, you get your ego in place and you assess the situation and whether or not you yourself are compatible, your values are compatible with the president's. And if they're not, don't do it. And I did it and I paid the price dearly. But listen, I face the music. I'm an accountable person. What are the messages? Don't play the victim. I've never blamed anybody but myself for my White House firing. Took the bullet, if you will, and also healed my marriage. You know, it's another big message, right? Like don't make your relationships disposable in life, I think is a very big message. And so Deidre and I, thank God, love each other. I mean, she's Italian. I'm Italian. Italians go crazy, right? I mean, she files for a divorce. We can't have like an argument. We got to go right for the jugular, right? But, you know, it's nine years later, we're still married. I think we're stronger than ever. And I think it's better for our kids, frankly, that we stayed married as well. You know, I mean, I love her, so of course I want to be married to her, but I'm just saying, you know, it could have gone the other way, and thankfully it didn't.
Well, I think one of the things about this book is that you're very honest and very humble about your mistakes. You, as you said at the top of this conversation, you own your mistakes in this book. Especially when it comes to assessing Donald Trump and your time in the White House.
But even prior to that, you know, I start the book out with I'm a smug 35-year-old Wall Street hedge fund manager making...
You did have a reputation as being really cocky.
Okay. Well, I'm still cocky though, so it's fine. That reputation still holds, by the way. Okay. I'm not going to pretend that I'm not. I mean, come on. I grew up, I'm a Long Island Guido. I mean, you married an Irish guy that is pretty similar to the way I grew up. Okay. We were like...
Maybe I actually... Yeah. Yeah. I'm going to talk about your childhood.
Was Jay doing push-ups in the parking lot before going to Uncle Sam's to disco? Was he doing that?
No, I don't think he was a lacrosse player. He's lying to you.
Probably was. Okay. May have saw a rest of... I was doing that. I mean, I'm a Long Island Guido. At least I know who I am, right?
I'm cocky, but come on. I mean, you know, what are you going to do? You're going to face the world, right?
You acknowledge mistakes even before you go to get humbled by life, right? You get humbled by your mistakes. You get humbled by life, you get humbled by your age, you get humbled by a lot of different things in life. And I think the point I was trying to make in the book is that we can get things wrong even as a country, but if we acknowledge what we've gotten wrong, we can advance and fix it seismically. We can advance exponentially to fix it.
So I start the book out with one of my biggest mistakes in business which is I'm assessing the World Trade Organization protests in November of 1999. Ralph Nader's up there with the unions and they are protesting the arrival of China into the World Trade Organization and China doesn't get in until late 2000. But, you know, the discussion in Seattle is about whether China should be allowed into the WTO. And the unions are saying if you do that, you're going to hollow out our manufacturing. You're going to kill our jobs. You've already hurt us with NAFTA. Remember the great sucking sound of jobs from Ross Perot.
Yeah. The giant sucking sound. Yeah.
The giant sucking sound. And so I'm sitting there as a 35-year-old saying, 'Wow, these guys are misguided. This is going to be great. It's going to lower the price of goods. It's going to be better for profitability and shareholders and it's going to have this dynamic positive effect on the American economy.' And it does the exact opposite. Right? So I start the book out by saying, 'Wow, me, others on Wall Street, executives, CEOs around the country who wanted China in the WTO, we got it wrong.' In fact, what we did with China is we let them in and they got emerging market status. And just put simply, that means they could send their goods and services to us relatively unfettered with tariffs. We had to accept that and then they could have some protectionism for our market. So this was a way to create rising living standards around the world. And that was probably okay in the beginning, Katie. But as they were growing, we needed to check them. We needed to treat them more like when they got to be the economic size of Germany. Well, then they should have been treated like Germany in the WTO and they weren't. And they took advantage of that. They were growing at an 11, 12% clip. They also tied their currency to ours. And so this is a book that's a breezy book. I had to write it for my 90-year-old mom who grew up in Port Washington who didn't go to college, but she's like one of the smartest people you'll meet. Okay. She's a lefty that the nuns forced to write with her right hand, but she's like pistol smart, but I had to write it in a way where she could understand it. So, if you pick up this book, you can read it in four or five hours. It's a breezy book with lots of stories, but content around what we did and what we were thinking at the time. And it's an indictment of both sides. It's not a partisan book. It's not a tribal book. It's like, hey, very smart people with really good intentions can make a lot of mistakes, misread something, misread the strength of China. We thought, and I write it all down, after Fukuyama wrote The End of History, we thought China was going to move towards a sort of party system, not a one-party system, maybe a multiple-party system, and a democratic form of capitalism. Boy, did we get that wrong. I mean, we just got that flat out wrong.
I like that you take the long view, you know, you don't blame anyone. I mean, you look at history and you look at decades of mistakes and this is not a rant against Donald Trump, although you have plenty of reasons to rant against him.
It's not actually, it's a precursor story to Donald Trump. Right. Which I thought was so interesting and...
It's really about the hollowing out of the middle class and about the American dream that your family, that you Anthony Scaramucci are the product of. And I know you told us a little bit about your dad. He was a Republican, but he was a member of the union. Tell us a little bit about your childhood and what was possible when you were growing up on Long Island.
And I write about this because what happened to the United States, and there's a great op-ed that I read about this. We had a near monopoly on industrialization. Just hear me out for a second. Europe is destroyed by the war. Asia is destroyed by the war. The last standing industrial power in 1945 is the United States. We weren't bombed at all during the war. And so we had, I mean this is an incredible statistic. We had 3% of the world's population, 50% of the world's GDP at that moment. And thank God we had great leaders at that time because they didn't want to lord over everybody. Imagine Trump in that position. We had Dean Acheson and Harry Truman and we had these classical neo-Victorians that were trying to do the right thing for the world. And they took a look at the Versailles treaty. They said, 'Okay, that was bad. We got too many reparations from Germany. They came back with this fascism. Let's do it in the opposite.' We started giving money out. We made the trade deals lopsided, more beneficial to those countries to help them. We put the Marshall Plan in place to allow them to grow. And my father's generation, he was born in 1935, benefits from this, if you're a blue-collar person because we are growing. We have excess industrial demand. And so what I write about my dad's paycheck, it was a light blue paycheck. It wasn't a white-collar paycheck, but it was a light blue one. He had pretty high wages.
He was a crane operator. Started as a laborer. He grew up in northeastern Pennsylvania, where my grandfather was a coal miner. Him and his older brothers left to mine sand out on Long Island. And he graduated into that position. When he got into his late 50s, it's harder to operate a machine like that. They made him a dispatcher where he was like weighing trucks. He had a hard physical job. Never complained about it by the way.
And think about America then. 41 years at the same company. Okay. Now that sand mine, if you remember that area, it was down on West Shore Road by Bar Beach. If you remember that area, that mine was dug out from 1905 to 2000. My father worked there for 41 years, retired in 2000 at the age of 65. And that is now a golf course there. But we, Ken Langone and others, myself, we built this big bronze monument to those workers, those immigrants, because a lot of that sand made these buildings here in New York City. And so it's just wanted people to remember what was there before this beautiful golf course was put in place. But my dad was a very hard worker. He made good money. He bought his house in 1962 for $16,000. I lived in that house. It was tiny, but we lived in it. We went to good public school in Port Washington. I was very, very lucky as a kid because there was a lot of really smart teachers in that school system. And I tell a story in the book where this guy John Zanetti, you know, comes to my father. It was like I had gotten into Tufts and like Binghamton and a few schools and this Italian guidance counselor comes to my father's house and you got to... I'm setting the scene for his old school. They're all smoking. Okay, my mother had the cast iron espresso pot, right? I mean the espresso is coming out like motor oil, right? I mean you're pouring it. It's 8:00 at night. They're smoking cigarellas and they're drinking motor oil espresso. I mean the heart rates had to be like 2,000, right? And they're talking in Italian to each other. And Zanetti says to my father, 'Listen, you got to let Anthony go to this private school. It's going to be better for him. It's better life experience. He'll be up in Boston. It'll make him a less sheltered person.' And so my father's like, 'Well, you know, the one school's $6,000 a year. The other one's like $24,000. These are 1981.' And he said, 'You got to do it. Anyhow, he'll find a job and stuff like that.' So my father cashed in his... I've told this story before, but I think it's an important story to tell about him. He cashed in his union life insurance policy, had a cash value of $10,000, and he gave it to me in April of 1982 to go to Tufts. And I just remember, Katie, I'm like, 'All right, I can't blow this for my father.' Okay? I mean, this is like...
I always teased him. You know, he passed in 2023. I said, 'Hey, Dad, that was a good investment that $10,000 that you gave me.' You know, I mean, he lived to... I mean, this guy ate everything, drank everything, smoked everything. I mean, if there was a cannoli in a six-foot perimeter of my dad's body, it entered the body. I mean, never seen a person like this, but he lived to 88, you know.
I mean, you and I are like taking peptides and... who, you know, like weaklings... [laughter] Not me. I'm doing all the right things, at least health-wise. Who the hell knows, my body collapsed. My old man did everything wrong, lived to 88, you know.
But also I think you talk about your childhood. You dedicate the book to your Nana or Nana. Nana.
She was great. She was a maid. You know, she was great. Obviously, you have a lot of love and respect and admiration for your parents.
They believed, right? They had this aspirational view of America. But I think what your point in talking about them, and you talk about this, write about this later in the book, is that kind of life is not possible today.
You know, I would say it's possible, but we have set conditions now for the lower and middle class, unfortunately, that made the thing very uneven. The starting gate for me, and perhaps for you, was a little bit fair. I mean, there could be very, very wealthy people, but I'm getting a really good public school education and I've got some ways to get myself funded for a college and potentially a graduate education. It's much harder today. If you look at the SNAP benefits, they're getting cut after the midterms. If you look at the unevenness of the education system, it's been hollowed out. I can give you 20 different things that have happened, but just the wage stagnation, Katie, that's the thing that's tragic to me. And I tell the story in the book. I'm with Trump in New Mexico. And this young man tells me, 'Haha, you think you're in New Mexico? New Mexico. That would be Mexico.' Because that's where the factory went. Okay. And we're all out of work here. We're all looking for jobs. And I remember getting back on that campaign plane in 2016 and telling then Mr. Trump, he wasn't president yet. I said, 'Hey, Mr. Trump, these wages in my dad's union on Long Island, I just inflation adjusted them 40 years from 1976 to 2016. The real wages in terms of purchasing power are down 26%.' Katie, that puts the family...
On an EBT? Well, I think that was one thing about Trump that you do have to give him credit for. He saw that anxiety.
He exploited it. Now, you would have wanted him to, and this is what we all imposed on him through cognitive dissonance. We said, 'Okay, here's the anxiety. Trump is talking about it. He's acting as an avatar for their anger. He's going to come up with policies to help fix it.' He didn't do anything for it. In fact, he made it worse.
Why is that? Do you think that it's a basic failure to understand economics or is it apathy? What is it?
Well, I think it's apathy. I think for him it was really about apathy. I think, you know, unfortunately for him, his view of the world is what is in it for me, enough of me talking about me, what do you think of me. And if he can make money and he can be in your mind, in terms of your mind share, those are the things that he wants. I don't think he's ever really thought about those people. You know, Howard Stern said it better than me. He wouldn't invite any of those people to dinner, you know, the ones that he's supposedly championing. And so, the irony is we went from my dad's class of people, working class, blue collar, economically aspirational to economically desperate in 35 years. And I explain in the book what happened and what the policy mistakes were that allowed that to happen. And so, by the way, all fixable. I want to make that very clear to people. We can fix this if we want to, but we first have to explain what happened. And then we have to elect politicians that are willing to fix it. Not be so focused myopically on their own personal self-anger and enrichment.
Well, let's talk about how we got here because this is one of the major premises of the book is what happened. And China was just one thing, right? Let's talk about the other things that have happened and when they happened because as I said, you take the long view and you look back decades at bad decisions that were made that kind of got us to the point where people were so aggrieved and then Donald Trump took advantage of those grievances.
Yeah. Well, that's where the anger-based populism comes in. But I want to talk about some good decisions, okay, first because I think it's important because we can do the right thing. George Herbert Walker Bush gets the job after Ronald Reagan. Dick Darman, if you would remember him, he was the OMB director.
I'm older than you are, Anthony. I remember all these people. Hair looks great, makeup looks great. You look great.
And you do have the best smile in America. So, I mean...
It's very big and gummy. I appreciate you saying that.
You had a better smile than Barack Obama. That's hard to say to somebody, but you got it figured out. But anyway, Bush and Darman, Dick Darman, they come up with this idea called pay-as-you-go. And what does that mean? We're going to put guardrails on the Congress, heavy deficit spending to bring down the Soviet Union, which is successful, but now we're going to put guardrails on the Congress. If you want social services spending, got to raise taxes. If you want to cut taxes, that's fine. You have to find something in the budget to cut. And so now we have these guardrails. Dick Gephardt voted for it. He lost seats in the house by doing that. And they adhere to this because you'll remember that George Bush said, 'Read my lips. No new taxes.'
But he put a tax increase in during the first Gulf War because he wanted to increase social services and he signed this legislation. He adhered to it.
And probably cost him the election. By the way, Ross Perot enters the race and we have this whole fiasco. But Bill Clinton adheres to the pay-as-you-go legislation.
Balances the budget. If you remember this, in March of 1993, he pushes for the largest tax increase in US history. No Republican votes for it. Al Gore is like OJ in the Bronco on CNN. He's coming out of the Naval Observatory and he's riding down Pennsylvania Avenue to vote the tiebreaking vote. But Clinton does something really smart. I've actually talked to the president about this because he spent many years here in New York and we've intersected with each other. He benchmarked the tax code to that 1993 decision. Meaning he went to everybody, business leaders large and small. He said, 'That's your taxes for my term. If I make it two terms, that's your taxes.' And why was that important? Because it set up long-term capital allocation, long-range thinking. If the taxes are moving like a pendulum and you're running a business, you can't do that, right? So he does this. We have the internet boom and we go on to print a budget surplus in the year 2000. So this is good moves, right? These are all the right moves. But now here come the wrong moves. Bush and Gore are arguing over the surplus. The CBO says in October of 2000 that we're going to have a $5 trillion surplus by the end.
And Al Gore. Oh. During the election. Okay. The debate, one of the debates, it was like the second debate was about the deficit and the surplus.
The CBO estimate, nonpartisan Congressional Budget Office estimate is we're going to have a $5 trillion budget surplus by the end of calendar year 2010. Governor Bush, what do you want to do with it? Vice President Gore, what do you want to do with it? They have this debate. Bush says, I'm going to cut taxes. Gore says he's going to put it into the environment, education, and infrastructure. Bush versus Gore. We know the whole story. The hanging chads.
Bush. Bush cuts taxes, Katie. And we go to war. Unfortunately, this is 25 years since 9/11. We go to war in Afghanistan. We cut taxes. By March of 2003, we cut taxes a second time and go to war in Iraq. This is the first time in our history that we prosecute two wars with a tax cut. We have typically raised taxes going to war.
Why do you think he did that?
He thought these wars were going to last a few months. They thought that we were going to be... Yeah. We thought we were going to get greeted by liberators. He felt that he could do that. He could win re-election as a war president and the economy would hum because the taxes were low. But what it did was it set us up for this deficit widening. And let's just go over the math. He leaves with a $7 trillion total national debt. You go from George Washington to George Walker Bush, $7 trillion and we've added $33 trillion of debt since George Bush left office. He left office in 2018. So we're talking 18 years. We piled on $33 trillion of debt because we relaxed the pay-as-you-go legislation. We put the Medicare Part D in. And again, I'm for these programs, but you have to pay for them. And if you don't pay for them, you are ultimately as a society going to pay for them. Remember Milton Friedman who won the Nobel Prize once said deficit spending is unfunded tax liability. And unfortunately our politicians, Katie, they pay for it through the most pernicious and the most regressive form of taxation. That's inflation. And so that kills all of the middle class and all of the lower class. Because people like my father, my father's singular asset was his house. That was it.
So, you paid him $1,000 and you inflated the money. Well, now he only has $700 of purchasing power. You know, it's important for your viewers to know this and they can check this and go to truflation.com. The US dollar has lost 28% of its value since January of 2020. Okay? So, pre-COVID to today because of the money printing and all the different things that we did and because of the affordability crisis upon us now. You know, again, if you own assets, you've hedged yourself because your real estate has gone up or your stocks have gone up or whatever. But if you don't own assets and you're a wage earner, they just stole your time and they stole hours of your labor by inflating the money like that. And so I write about it in the book. This is what's causing the anxiety in the society. And so step number two, catastrophic decision, going to those wars without increasing the taxes. Third big decision which was a disaster for us was the bailout. When we went to bail out the banks, I understand why we did that and I understand that that was a necessary thing to do for the government, but they needed to carve out some money for lower and middle income people. They didn't do it. And so now, wait a minute. The fat cats on Wall Street are getting paid. Ready? 5,000 people on Wall Street were paid a $1 million or more bonus in calendar year 2008 while their neighbors were suffering. Okay? And whether you're George Bush or Lloyd Blankfein, you could pick the person. They've all looked back at that and said, 'Hm, probably wasn't a great idea. We probably needed to give some middle income relief or debt relief, mortgage relief, rent relief, credit card relief, something.' And this created the anger that we're living in today.
And why didn't they just do that?
I think again a doctrine of good intentions going bad. Okay, so Bush is thinking with Cheney, these wars last a few months. They'll be over before the 2004 campaign. They go on for two decades. I think WTO, we're going to bring China in. It's going to fortify them. It's going to create a big consumer market that we'll be able to sell goods into. Be good for them, good for us. But China, you know, thought otherwise. And I think in this situation, it was like they were thinking the banks will heal, that'll be good for the economy.
Mhm. But they left out trickle down.
I think a little bit of that, but also just the overall economy healing would be good and they didn't need to do that. You know, this is the weird thing about the United States. Hear me out for a second. If the bank needs a bailout or GM needs a bailout, even though that's a form of socialism, for some reason, corporate socialism is okay, but you want to give the kid a free meal or you want to give the kid free health care, all of a sudden now we're running into communism and socialism. There's a little bit of a hypocrisy there, right? Crony capitalism is okay. Corporate socialism, you know, the banks need a bailout. Let's give it to them. That's okay. But to feed the kids at the base level or give them free lunches, let's cut that. There's an irony there and I think it has to be addressed. And I do write about it in the book.
We're going to talk about sort of the prescriptive ideas that are in the book as well. But since you brought up socialism, I'm curious to hear your views on so many young people, you know, a much higher percentage of young people than ever before say that consider themselves socialists. They don't think socialism is a bad word. Now you have Democratic Socialists of America. And I'm curious how you feel about this tilt toward socialism because of this feeling that the system isn't working for me, man.
So, listen, I completely understand it because this isn't capitalism. When you have eight major corporations that take up 30% of the market capitalization of the S&P 500, that's crony capitalism. That's not capitalism. When you have a feeding funnel where the richest people are up against the government and they're feeding the candidates through Citizens United unlimited campaign funds...
And getting big contracts in return.
Exactly. They're getting everything they want and you've got...
For lack of regulation. Right.
Exactly. Well, listen, I'm going to give you the money. I would like to put the fertilizer in the children's cereal. Are you cool with that? Sure. Let's do it. So, now the glyphosate is in the children's cereal. Okay. And the people are looking around say, 'What are you guys doing? You've destroyed the water. You've hurt the food standards in the country. We can go to Europe and eat and lose 5 pounds. We come back here, we gain 10. What are you guys doing?' And so what you see in the society now, there's a circuit between the big businesses and the lobbyists and the political leaders that are going like this. This is a cronyism that the people that are not involved with it, they see a two-tiered system and they get upset and they want their fair share. And so the socialist message is we're going to give you your fair share. You know, which is stupid actually because what we should be doing is what Teddy Roosevelt did. Teddy Roosevelt looked around and said, remember he was a Republican, but he's also the father and the creator of the word progressive and progressivism. And if you go back to what he did and McKinley was doing it before him and of course McKinley got shot probably for a lot of this. But what were they trying to do? They wanted to break up the trusts. They busted the rail trust. They busted Rockefeller. Roosevelt famously said to Rockefeller, 'Sorry man, you can't have two and a half percent of the GDP of the country. That can't be your net worth. We're going to break you guys up.' Okay? And we know that the breakups unleash more innovation. They create better pricing. And we're not doing that anymore. So, it's understandable to me why the kids feel this way. But I would like to reform the system, rather go into socialism because what we've learned about socialism when it's tried, it looks very good on paper, but it misaligns human incentives. And when you misalign human incentives, you create an upside down economy and you'll slow the growth. Look at how America is growing relative to Europe over the last 10 years, as an example. You'll see they have more socialist policies there. We've been able to grow our economy by a net 50% over them over the last decade and it was noticeable to Europeans. The Wall Street Journal wrote the article about it. Europeans came here for the World Cup. They're like, 'Wow, this is a much richer place than Europe.' So, I would just caution the socialists. But the flip side is if we don't break this circuit between the very wealthy and the political machinery. If we don't break that circuit, and again, I'm not talking about hurting anybody. I'm just talking about we need reform like we did in the early 1900s.
Have you ever seen it this bad? I mean, this crony capitalism...
I mean, I think it's also 1890 to 1910, the robber baron era, right?
It was this bad. In some cases worse. But politically, have you ever seen a president like this who has enriched himself because that's part of the motivation, isn't it?
No, you've never seen anybody do this. You have had presidents, the Teapot Dome scandal, you've had other scandals, you've had some self-dealing presidents. If there's been 45 people that have made it to the presidency because Grover Cleveland skipped one and so did Trump. So there's 45 people that made it to the presidency. There's only one person that has done this. That's Donald Trump. But there are probably five or six others that did things that were inappropriate in that office. Unfortunately, it's human nature. But what Trump did should send alarm bells to people because he exploited a seam in the Constitution. Remember, they wanted Washington to be the president. And Washington said, 'I don't want the job.' They said, 'Okay, what is it going to do to get you a job?' 'I want a farm at Mount Vernon.' Okay. So they left the president out of the immunity clause. Go look at the constitution. And Trump has exploited that, you know, and the other guys didn't do that. They followed the norms. They followed the rules and the standards. And Trump, you know, will tell his people privately, 'Oh, look at these dummies. They could have made a couple billion dollars themselves, too, but they're just not as smart as me.' But it's swarmy. And it's a corruption that sends a message to people that there's a two-tiered system. And so when Trump's taking a billion dollars for himself, he's actually creating more socialism.
Younger people are looking at that saying, 'Hey, that's super bad.' And we're never going to get a fair shake with a guy like that. Let's vote for the Democratic Socialists of America.
Yeah. The three catastrophic decisions, just to review, China's entry into the WTO, the decision to invade Iraq after 9/11 and cut taxes at the same time, and the 2008 financial crisis bailout. These are both mistakes made by Democrats and Republicans. But during this period, the Democratic Party began to lose its hold on the white working-class voter. And as you explain it, stopped trying to win it back at a certain point. Kind of gave up, right? Became more sort of attractive to liberal elites or coastal elites.
Anyway, you write in the book that they often attributed that loss to racism and sexism rather than confronting their own economic message. Can you explain what you meant by that?
Yeah. So I coined something for the book called the money point of view of history. And so if you love America, guess what? America loves money. Okay. Calvin Coolidge said about America, 'Business of America is business.' That you got to follow the money in America to really understand where people are. And so what happened is as those wages were stagnating and as those people were feeling disadvantaged, the Democrats were going into more cultural issues. You know, they wanted transgender bathrooms or they wanted different pronoun usage and designation. They wanted more inclusion. Okay, this is the whole culture of the woke status, if you will.
And so they sort of gave up on them. The Republicans had no interest in them. They were for the corporations and for the tax cuts, okay?
But they got him by default. Well, Trump comes in. Trump comes in and starts preaching a message that you've been screwed by everybody. And they say, 'Okay, you know, you're right. We have been screwed by everybody.' And what's the most fascinating part of this whole thing is Joe Biden actually gets that. He actually puts legislation in, you know, the CHIPS Act, the Reformation Act of manufacturing, a number of different things to try to fix it. But unfortunately, due to health and other issues, he drops out of the race. And so he's not able to complete that legislative agenda. That's the big irony. He probably saw it. He was probably in a position to reclaim that position. I mean, these are people their parents voted for Lyndon Johnson. Their grandparents voted for Franklin Roosevelt. They had nobody to vote for anymore. And what I say that message is about money. When you start losing your wallet, you start looking elsewhere for your choices of public servants. And you know, Secretary Clinton is probably still mad at me. That's fine. I'll say this. She didn't go to Wisconsin after her nomination. She gets nominated in Philly. She serves no time in Wisconsin. Dairy farmers, industrial workers, assembly line people. They don't hear from her. Okay? And she makes the assumption or her team makes the assumption, well, these are our voters. They voted for us for the last, you know, 60 years worth of presidential elections. They're going to vote for us. Trump goes there 14 times after he's nominated in Cleveland and he wins the state. And this is the stuff that I talk about in the book and it's about following the money and if you follow the money you'll see where the people are and what they're thinking about.
Let's talk about the solutions because you have a number of them. We don't have time to go through all of them but you say five major policy reforms, three constitutional amendments will get us out of this mess. I know I said we didn't have time, but can you kind of...
Well, describe them. And the first thing I'll say, if you're cynical and you're listening to me, you're like, there's no way we're going to get a constitutional amendment in this country. If you're cynical and because of the way the tribalism is and the partisanship, but I'm speaking now as an entrepreneur, and what American entrepreneurs have done successfully for 250 years is they've taken something from zero and turned it into one. Something that looks completely hopeless. They manufacture and create and we have to think like that. We have to have entrepreneurial politicians and so the amendments that I'm talking about are ending Citizens United. You have to end it. You cannot have this level of money...
The court upheld it. I mean how you... so that you an amendment if you got a constitutional amendment 37 states voted on it ended Citizens United then that's codified into the law of the United States. It can't be interpreted by the court as being not consistent with the constitution because we just amended the constitution because they have to amend it.
The second amendment that I'm talking about is ending gerrymandering. The gerrymandering has gone too far. And for those people that may not know what it is, the politicians get together and they carve up the congressional districts. This could be local congressional districts like a state representative or the house of representatives, the federal district. They carve out their enemies and they carve in their friends.
But how are you going to end it? I mean, Eric Holder was head of a commission that recommended making gerrymandering illegal basically or abolishing gerrymandering and it didn't pass.
Okay, Katie, we have 100 million people in this country that vote the same way in every single election. They vote the same way. It's the most powerful voting block in the country. It's the non-voter. We have 100 million people in this country that are eligible to vote that no longer vote or didn't even register.
It's so upsetting to me. Why don't they make election day a national holiday? Can you also recommend that?
Well, but just understand this. It's against the interests of the politicians because they want to permanently stay in power. I mean, Chuck Grassley, I think, is like George Washington's great-grandfather or something like that. I mean, come on. The guy's like a hundred years old. He's gonna run for reelection. I mean, these people, they just want to be a permanent class of people at the top. And so, they've created this cartel, this very tight duopoly to allow them to stay in power. So, therefore, you have to get a political leader who's a reformer who can convince those hundred million people. You got to create a new... think like an entrepreneur. You got to create a new market. You got to go after those people. Okay? And if you can do that, you can get this stuff done. And people don't really understand it. If you sat down with them and said, 'Hey, this is what these people are doing to you. Do you want to change it or not? If you want to change it, you got to show up and vote and we can change it and fix it.' And I believe the people of this country want to fix it and I think they're exhausted by what's going on right now. Just a few other things quickly because I know...
No, no, no, no. We're fine. You know, the other is reforming the tax system.
Have to reform the tax system. You have to make sure that the bottom part of the tax code gets an earned income tax credit. This is a Warren Buffett idea that protects their living standard. Okay, the other thing you have to do, the wealth tax is not going to work in this country. So, you can pretend it is. Ro Khanna wants it. Elizabeth Warren wants it.
Why isn't it going to work?
Because rich people have mobility. And what rich people will do is they'll move out of the country. Look at the non-dom tax situation in the UK. They lost all their wealthy people. They moved to non-dom places that were friendly to them and it hollowed out the restaurants. It hollowed out the service industry. It's really hurt the British economy. They were getting a lot of ancillary tax revenue by having the rich in place. You know, you can like or dislike Elon Musk, but SpaceX could have been in California, okay? But if you want to wildly tax him, he's going to move it to Texas. Okay? And that's what he did. And so, I'm just telling people, I get it. It looks good on paper, but rich people have happy feet. Okay? And so the way to reform the taxes, you have to put in a consumption-based tax. And this way all of that black market activity, all the cash that goes on in the country gets picked up from that consumption-based tax. And I wasn't for that 40 years ago, but you have to be for that now because of the way the income disparities worked in the country.
Well, the income inequality I think is at the root of most of our problems, Anthony. And so I asked my husband because he and I have talked about like how these billion, you know, the rich keep getting richer and richer and richer and getting tax breaks and all that. So, I'm going to read the question he wrote because I want to get it right.
Many of America's wealthiest people have little or no traditional W2 income to tax. Instead, they can borrow against highly appreciated stock to fund their lifestyles without actually selling those shares and triggering capital gains taxes. So, no wonder someone like Jeff Bezos, this is me, not John. So, no wonder someone like Jeff Bezos and other high-profile and lower profile billionaires are not being taxed. How do we fix that?
