Donald Trump is probably the largest political figure, at least has loomed the largest over the first 26 years of the 21st century.
Were you holding your nose and going to work for him because you had hope, or did you actually think he was the answer?
This doesn't reflect well on me. I think I was overly sucked in. When you ask people what were some of the motivating reasons why they voted for Donald Trump, it was to end that cancel culture, and he exploited that. Now, there are cynical people who say America's over. I don't believe that. I think every time America gets written off, I think people are surprised.
Hello and welcome to Ways to Change the World. I'm Christian Fraser, and this is the podcast where we talk to extraordinary people about the big ideas and their lives and the events that have helped shape them. My guest today has had one of the most unusual careers in modern American public life. He's a Wall Street financier who built a multi-million dollar investment firm, and for a brief but unforgettable moment was central to Trump's first administration. He's now one of Donald Trump's most vocal critics. And in his new book, All the Wrong Moves, he reflects on the ambition and decisions that brought us here. So, what did he learn from his brief time inside the White House, and what does he think today? Anthony Scaramucci, welcome.
Thank you, Christian. Thanks for having me on.
If you could change the world in any way, and there are a few ideas in the final chapters of the book, what would you do?
Well, I mean, kindness is the number one thing. We'd probably want to project as much more kindness as possible. But for America, I think there's three simple things. We'd have to open our primary system. And just to explain that to your viewers and listeners, we have two parties, but many of the electorate have ejected from those two parties. So, we have 40 plus percent of our electorate now is independent. And so if we opened up the primary system, we could get the more moderate people that have left the two extreme ends of the party. Now, if they came back into the primary system, you'd probably get more moderate candidates, and that would end some of the tribalism. The second thing I would want to do as it relates to the United States is end the gerrymandering, because that's also created this permanent incumbency cycle. The Congress has a 14% approval rating, slightly above Kim Jong-un, the North Korean dictator, but you know, they get a 95% incumbent reelection rate, and so that's terrible. We have to change that. And then the last thing, which I think is very important in America, is get the money out of politics. We allowed unlimited amounts of money to come in after the Citizens United Supreme Court decision in January of 2010, and that skewed the legislative agenda, the policy agenda to big business, big pharma, big food, tax cuts for the rich, and it's left out lower and middle-income people, which is why we have all this anger-based populism. So, I want to change the world by changing the United States, actually reforming something that desperately needs reform.
How would you take money out of politics? Should you put limits or...
Well, I think the only way you're going to do that at this point is with a constitutional amendment. But I mean, you could examine what the UK does, Ireland, Australia, other great Western democracies. There are certain spending caps and there's certain limitations. The Supreme Court said in 2010 that it's your First Amendment right. If you're a very wealthy individual, you can spend unlimited amounts of money on candidates and/or policies. The danger in that is that the politicians respond to that. And so there's no more advocacy for the little guy. The little guy has been left out of the equation. So I think the simple thing to do is you could cap it. You could return to the Volstead Act, which effectively was repealed, where you could have spending limitations. And I think that would lead to a lot of reform.
Because we're going the other way. I mean, big money is entering British politics now in sort of quite extraordinary ways.
I saw that. I think it's dangerous because what ends up happening is these politicians... remember, these campaigns are marketing competitions. These campaigns need money. And unfortunately, most of the people that go into politics are not wealthy, and so therefore there'll be an obligation to the people that give them that money.
So what is the warning from America and your experience to Britain as Britain sees these enormous donations?
We put fertilizer in our children's cereal. It's acceptable to have glyphosate remnants in our children's cereal. We chlorinate our chicken because the food manufacturers don't want to fix the sanitary process and the processing. And so the result of which, you get to the end product, they chlorinate the chicken. I don't know, do you want to eat chlorinated chicken in this country? I would recommend that you don't. I would also recommend you don't want glyphosate in your cereal. But I'll tell you what, you let the money into the system, these big corporations, the big business people, in a way to save money in processing and cutting their expenses, they'll encourage politicians to regulate them in a more self-serving way than they're currently regulated.
I mean, what we're seeing here as well is not just big corporations, but individuals, billionaires...
And obviously there's a long history, you know, on both sides of the Atlantic of rich individuals.
Yeah, it's not just crypto billionaires, but trust me, it's tech oligarchs. It's all sorts of other wealthy individuals. You know, maybe the crypto billionaires in the specific case of Nigel Farage here in this country, but you know, there's a lot of interesting and quiet ways that the very wealthy get their money into the political system.
I mean, you spent decades fundraising, so you know these kinds of people well. When they say, 'Look, I've made all the money I need to make in my life. I'm not doing this for myself. I'm doing this for the country I love.' What should we be thinking?
I mean, you know, I don't know. Is the Tower Bridge for sale? I mean, I know the Brooklyn Bridge is for sale in Manhattan. I mean, it doesn't work that way, unfortunately. It's not the way human nature is designed. You know, even if you read Adam Smith and The Wealth of Nations, you have to have a process and you have to have a pitch that has certain guidelines. You know, I mean, when the red cards are being shown, there's a reason people get aggressive on the pitch. It's the same thing in business. You know, I accept what Mayor Kaine said about animal spirits, but the flip side of it is you need a government or some type of regulatory authority to control the process of that greed, because the greed always overcomes wisdom. And it's very hard for people to control themselves. And I write about it in the book. You know, if this was a book about my mistakes, Christian, it would have been a phone book this big. Okay? I write about things that I've seen, decisions that I made that would have been wrong for me personally. And I write about decisions that politicians have made that would have been wrong for the country. And usually when I'm making a bad decision, my ego is invested in it. My pride is invested in it, or I have some type of emotional tie to the decision as opposed to some level of analytical detachment. And so you've got to be very careful, because if you let the money in, the money will find its way into hands that could be easily manipulated.
So when you were fundraising, did any of this occur to you, or were you just doing it cynically?
So this is the interesting process. When I started out as a political fundraiser in the '90s, by the time we got to 2010, the fundraising was fairly discreet. You know, back then you had a $1,000 maximum that you could give to a candidate. It's moved to $7,000. Now, that's still quite minimalist, if you will. But where the maximalist stuff happens is in the political action committees. And so, by 2010, we had the advent of the political action committees. You may remember the Koch brothers, Charles and David Koch. I don't know if you're familiar with them. It's Koch Industries based in Wichita, Kansas. When the political action committees became available, they went out and raised hundreds upon hundreds of millions of dollars, and they put it into state and local elections, which helped them control the congressional districts. You know, remember you have the lowest registration numbers for the Republicans. It's independents, Democrats, and then Republicans. And yet the Republicans control the House. They control the Senate. They control the American presidency, and they control the Supreme Court. So when the money started coming into the system back when I was doing the political fundraising, you could see the changes, the seismic changes that were being made in the government. And so I left political fundraising in 2016. So I was only there for a short period of time after Citizens United. Once I went to work in the White House and then I was similarly fired, I stopped fundraising. So I'm nine years away from it, but I can tell you it's done a lot of damage.
Just finally on this, I mean, do you know either of these individuals in Britain, Ben Delo or Christopher Harbourne? Have you come across them? Because obviously you're big...
I haven't come across them, but I'm more associated with the Coinbases of the world and the Krakens of the world. I'm not familiar with them, but I also understand that they don't live here in the country. That this is money that's coming in from outside the country into Nigel Farage. So again, I don't know the rules here. I like opining more on American politics, but you know, the foreign entanglement issue is a big one. Trust me, we're seeing it with the president.
Let's talk about All the Wrong Moves. I mean, you helpfully tell us the three big ones right at the beginning. Just lay them out for us.
Well, listen, here's what I would say. I tried to pick three large things. Of course, there's smaller things and there's semi-large things, but those are the three big ones that I think shifted the culture and created some anger-based populism. And so, is China completely responsible? What I say, mistake number one is allowing for China to come into the World Trade Organization and come in unchecked as a nation. So they start out as an emerging markets nation, and then as they're developing, we don't start bringing them up the scale to say a UK or a German economy, and so they're able to protect their markets. They're able to ship goods into our markets at very low prices with low tariffs, and as they're rising, we don't do the corresponding measures necessary to balance it more fairly. That causes a problem in our manufacturing sector. It causes a hollowing out of our industries. It's not the only problem. You know, had China never gotten into the World Trade Organization, would we still have had some offshoring? Certainly would have, because we had signed NAFTA in 1993. But I do think it is a big problem, and I do think it's a problem that impacted the culture, and so that it has to be addressed. The second one is the wars. We go to war, two tax cuts going into those wars. We had an '01 tax cut and we went to war in Afghanistan, an '03 tax cut and we went to war in Iraq. Those wars were very costly. Now again, the administration officials at the time thought we were going to have a war ending in weeks, if not months. They didn't expect it to go decades. And so this is the first time in US history that we had reasonably massive tax cuts going into a high expenditure war, and that caused the deficit trajectory that we're experiencing right now. And it's roughly gone unabated, and the statistics are staggering. You went from George Washington to George Walker Bush and spent $7 trillion in deficit spending. The ensuing presidents, and there's only been three of them, have spent $33 trillion of deficit spending over an 18-year period of time. It's a staggering number. And it's not sustainable. It will cause a debt crisis in the United States if we don't put the appropriate guardrails on governmental spending. And of course, the last one is the bailouts. I'm just simply saying I recognize from an economic perspective we had to bail out the banks to restore trust and restore confidence in the system, but we probably should have had a portfolio allocation, maybe 75% of those banks, but how about 25 or so percent to lower and middle-income people in a form of tax relief, mortgage relief, rental income relief, credit card relief, something. The bankers got it all. They then went out and paid their bonuses. Over 5,000 people in the United States got a million dollars or more in bonus money the year that the banks collapsed. I think that engendered a lot of anger in the country. And you saw that in the manifestation of the Tea Party movement. You saw that in the manifestation of Occupy Wall Street. And I say in the book, those two guys got married and they made a baby and they named the baby MAGA. And so we're living with it. And so this is not a Trump story. This is the precursor to Donald Trump. He's a symptom of a bigger, broader problem in America that I think has to be healed and has to be fixed.
I mean, they are the things that you believe led working-class America...
...to be thoroughly disillusioned with politics.
No question. There was no grounding wire. There was no advocacy. Establishment politicians, for some reason, left a vacuum of advocacy for those people. They were traditionally, these white working-class voters were traditionally tied to the Democratic Party, but for some reason they left them. They started focusing on cultural issues or pronoun usage and things related to the woke culture, as opposed to just focusing on helping people increase their disposable income. We turned a group of Americans, as I write in the book, families like the one I grew up in that were once blue-collar aspirational, and we turned those families into blue-collar economically desperational. And it's tragic to watch it. The wages stagnated, the disposable income adjusted for inflation stagnated. And you've got many Americans now that have scant savings. You know, the statistics are wild. So, I mean, the median income in the United States is about $83,000, and less than half...
That's a record, isn't it? But it's meaningless because of inflation.
Of course.
Well, if the median house is 400,000 and the median income is 83,000, you can't make the math work where you can afford the house. So you have people in our country, which is, I would argue, a very wealthy country on a per capita basis, but it's very top-heavy in terms of where the wealth is. So you have lower and middle-income people that are missing dental appointments. They're missing doctor's appointments. They get a fender bender with their car and they won't bring it into the auto collision expert because they don't want to have an increase in their insurance premiums. It is a big problem. And it's worsening. It's not getting better.
I mean, there's quite a lot to unpack there, obviously. I mean, because those three things that you identify, I think, you know, there's a lot of agreement that they led to all of the things you're talking about, but the question is whether there were real alternatives. You know, China also delivered affordable consumer goods, enormous global economic...
Okay, so let's have an alternative history role play on your podcast. Can we do that? So again, this is all Monday morning quarterbacking. And again, as I point out in the book, I got a lot of this stuff wrong as a Wall Street analyst, and I got a lot of this stuff wrong as a failed White House communications director. So I'm not picking on anybody. I'm just being observant. But with hindsight now, let China in. Let's try to get the benefits of the low-cost goods that you're describing, and they should certainly be in so that we can lift living standards globally, which usually keeps the peace. But as they become equal in status to the United Kingdom, remember in 2003 they had less of a GDP than Italy, as they're rising and they're clipping off 11, 12% growth, and they become the size and scale of the UK economy or the German economy, shouldn't they not be treated like the German economy and the UK economy? They weren't. They were treated like an emerging market. So I'm just saying we could have done things on the margin that made the playing field more competitive for the German, the UK worker, the US worker. Let's go to the wars. I write in the book, we had budgetary restrictions that were started in Bush One. George Herbert Walker Bush came up with pay-as-you-go legislation that put guardrails on the Congress's ability to spend...
...which means if you spend, you've got to find the money.
Exactly. Yeah. As I referenced in the book, that gets unclipped as a result of 9/11. If you had just adhered to that, you would have forced a tax increase to pay for those wars. Okay? And so, yes, there's an alternative history here with better decision-making. If you gave $250 billion to lower and middle-income people, and let's say you put 750 into the banks, you would have solved for some of that anger. People would have looked around and said, 'Okay, it was more evenly distributed.' Again, look at economics of the distribution of economic rent between labor and capital. When it's in equipoise and labor feels like it's getting enough of the economic rent, it's very happy. When it comes out of whack like it is today, you get this income disparity and you get this outrage, and you start electing left-leaning, right-leaning, reform-based populist leaders.
I mean, when you talk about your own background, I mean, let's talk a little bit about that, because as you say, you came from a working-class family, basically.
Listen, you know, you guys define in the United Kingdom middle class probably a little differently than we do. I would say that we were in the American middle class. My father had a high enough wage where he bought a house in 1962 for $16,000. He had a 30-year mortgage on the house. We had those in-window air conditioners as kids. My father was very strict. We could only put it in on Memorial Day. We had to take it out on Labor Day. It could have been 200 degrees the day after. He didn't care. He was very disciplined with his budget, but we had a good upbringing. I'm not going to dishonor my dad or mom by telling you I grew up poor. I did not grow up poor. I went to a good public school, at least the American definition of a public school. And then I went on to Tufts and Harvard. I didn't really have the money to go to those places.
Was a Democrat family, basically.
Well, see, that's the irony. So my father's union, and this is quite unique, and David Axelrod, actually Barack Obama's political analyst, when I did his podcast, he said, you know, you're a Republican because your father's union was controlled by the Republicans out on Long Island. And I said, yeah. And so to understand Long Island, there's an area called Nassau County. That's a decidedly, typically decidedly red county. And so the unions in that county, which was atypical for the United States, were controlled by the Republicans.
Red here is obviously confusing. Red means Republican, not left.
Exactly. You go in the opposite direction. But so it's a conservative community. And so the irony there is, even though Republicans, I think, as David Axelrod pointed out, there were probably three counties in New York of all the counties where the unions were controlled by the Republicans. I happened to live in one of those counties. So when I registered to vote as an 18-year-old, my father insisted that I register as a Republican.
So what drew you to Republican politics?
You know, when I was a kid, I got into these private schools. As a family, we couldn't afford them. And my father went to his union foreman and eventually the Republican county commissioner, if you will, and they helped me get a union card as a young man to work on the stone dock in my town. So I was making like $16 an hour in the summers while I was going to school. And I got that as a result of Republican patronage, frankly. So I've stayed very loyal to them for that reason.
I mean, you say you're loyal to the Rep... I mean, what is the Republican Party now? Is there anything left to be loyal to?
That's the reckoning. You know, I believe that Donald Trump is a ve... listen, however unpopular he may be right now in the United States, we have to at least acknowledge that he is probably the largest political figure, or at least has loomed the largest over the first 26 years of the 21st century. He's been on our face. He's been our windshield for the last decade. And so I would say that he's cavorted the Republican Party. I say he's decapitated it. He's installed his MAGA populist base in the party. There's absolutely no question about that. And so the issue will be, are there remnants, are there intellectual remnants of the old party that can be recast after he leaves? And so I'm here for that fight.
But is there still an intellectual debate?
I don't know. Hopefully, Christian, you're going to invite me back sometime in 2028, and I'll tell you, you know, that party is long gone. That is the party of MAGA and right-wing populism, or it may be a personality cult-like phenomenon where when his political life expires, which it will in January of 2029, as that political personality expires, typically the cult goes down with it, and then I think there's the space for the debate. Now, I could be wrong about that. I'm not suggesting... we'll have to see what happens, but I really do feel like people are looking around saying this has not worked. The people that voted for Donald Trump right now, when they're asked about it, they say, 'Yeah, no, what he promised, he has not delivered on.'
You see, I mean, normally when a party's out of power, the sort of intellectual renewal goes on in think tanks and with certain, you know, intellectuals and, you know, political individuals. It's not clear to me that that's actually happening in America anymore, and that, you know, or whether all of that's just been hollowed out.
Um, well, I mean, again...
