Tangled Up in Blue with Rep. Ro Khanna: Tariffs, Trump, and Progressive Capitalism

Rejected by voters last November, the Democratic Party is perhaps afforded new life given President Trump’s decline in popularity and economic uncertainty ahead. What is the party’s message? 

Rep. Ro Khanna, a prominent progressive voice whose California district includes parts of Silicon Valley, joins Hoover senior fellows Niall Ferguson, John Cochrane, and H.R. McMaster to discuss tariffs and the use of executive power, “blue state” mismanagement, the feasibility of a “Marshall Plan” for economically downtrodden parts of America, plus the chances of Democrats parting ways with their “old guard.” After that: the three fellows weigh in on the Trump presidency at the 100-day mark, the future of Catholicism after the death of Pope Francis, tax exemption for universities, their go-to takeout food (pizza yes; haggis, no), plus two April landmarks—the 250th anniversary of the Battle of Lexington and the 50th anniversary of the fall of Saigon.

Recorded on April 28, 2025.

Episode Transcript

(00:00):
[MUSIC]

>> Bill Whalen (00:08):
It's Monday, April 28, 2025.
And welcome back to Goodfellows.
A Hoover Institution broadcastexamining social, economic,
political and geopolitical concerns.
I'm Bill Whelan.
I'm a Hoover Distinguished Policy Fellowslash moderator.
Looking forward to a conversationfeaturing three of the brightest
minds I know.
The Goodfellows, as we call them.
I'm referring of course,to the historian Sir Niall Ferguson,

(00:29):
economist John Cochrane, and formerPresidential national security advisor,
Lieutenant General H.R. McMaster.
Niall, John andH.R are all Hoover Senior Fellows.
Gentlemen, a two part show today.
In the second part, we're going to lookat the Trump administration at day
100 handout grades, assess progress.
But first we're going to talkto a neighbor of ours, and
I'm referring to Congressman Ro Khanna.

(00:49):
He is our neighbor because he representsthe 17th congressional district here in
California, which spans the southernportion of Silicon Valley,
which is just south of the HooverInstitution and Stanford University.
Congressman Khanna serves onthe House Armed Services Committee and
the Select Committee on the StrategicCompetition between the United States and
the Chinese Communist Party.
Ro Khanna is one of Congress'sleading progressive voices.

(01:10):
Which raises a question, sir.
You graduated with an economics degreefrom the University of Chicago,
home to such economic luminaries as MiltonFriedman, Gary Becker, and of course,
our own John Cochran.
All Hoover fellows,my question to you, sir.
How does someone with all that economicwisdom at his disposal somehow
end up in California asa very outspoken progressive?

>> Congressman Ro Khanna (01:30):
I had Gary Vecker for price theory.
A brilliant, brilliant mind.
And I have a great fondness formy education at University of Chicago.
Not just the education on economics,but more importantly
the education on philosophy andhumanities and really the tradition

(01:51):
of philosophic thought that givesrise to the American Republic.
I call myself a progressive capitalist.
I mean, even Milton Friedman andpeople like Robert Lucas or
Becker would have acknowledgedthat markets don't always work.
And one of the places that the marketshave failed this country has been

(02:16):
the hollowing out of factory towns,the decimation of rural America.
Wealth has piled up in my district,in New York and Seattle, and yet
a lot of communities have been left out.
We've gone from 53rd inincome inequality to 128.
And what I believe is that we need tofocus on the economic revitalization of

(02:38):
places across this country and the federalgovernment partnership with technology
leaders in the private sector to do thatwithin a framework of free enterprise.

>> John H. Cochrane (02:51):
As the other University of Chicago,
I detect a little bit in you, and I'mcurious if you'd like to say yes or no?
There's this new movementwithin the Democratic Party,
the YIMBY movement in California thatrecognizes, we have a housing problem.
Maybe the fact we don't let people buildhouses has something to do with it.
Let's them build houses.

(03:11):
It takes forever to get permits toconnect a windmill to the grid.
Why don't.If you want an energy transition or
energy at all, maybe we need to do that.
Sir, I see some commonality betweenthe techno optimist, libertarians.
Some of them hang out with Republicans,some of them hang out with Democrats.
I wonder if you wouldcall yourself among or
at least sympathetic to that group whichcan, from the University of Chicago,

(03:36):
can head left orright to their party affiliation.

>> Congressman Ro Khanna (03:40):
Yes, I'm a gimby.
I believe that Californiahas had bad housing laws.
The zoning laws have been too restrictive,
the burdens on buildinghave been too restrictive.
We need to be honest about that.
We need to be honest about the burdenswe've put on building things in America.

(04:02):
And so I am sympathetic to that.
And I've endorsed a number of the recentstate bills, which I rarely do.
But there's a bill going currentlythrough the California legislature
to make it easier to bill more housing,and I have supported them.

>> Bill Whalen (04:19):
Congressman, I want to get into three policy areas with you and
what time we have with you.
Let's start off with the question oftariffs and then maybe segue into
executive orders, which is a favoriteJohn Cochran hobby horse these days.
You represent a district thatis home to Apple and Nvidia.
What's your thoughts on whereyou think this is going?
And I have this question to you, sir.
As I understand it, the national security,

(04:40):
the emergency acts that the presidentused to invoke tariffs, they also
say the tariffs can be eliminatedvia a joint resolution of Congress.
I believe that's the case.
If that's true, where's Congress?

>> Congressman Ro Khanna (04:52):
Well, you don't have to study economics under Gary Becker
at the University of Chicago to know thatDonald Trump's tariff policy is the most
economically nonsensical policy ofany modern American administration.
He's committing the cardinalsin in American politics.
He's destroying people's money anddestroying people's wealth.

(05:12):
And this is why we're going to havenot only wins in 26 and 28, but
the potential forlandslide wins and a realignment.
Now, look, I am forthe use of strategic tariffs if China
is engaged in unfair competition anddumping things.
But this idea of having blanket tariffson every country is increasing the price

(05:36):
of inputs and manufacturers and you can'tjust protect things before building them.
I mean, a lot of these tariffs we don'thave even have the industry here.
And so there are people like Don Bacon,
a Republican who is a Nember Escomember who's calling for
a repeal of these tariffs onco sponsoring his legislation.

(06:00):
I hope the speaker will bringit to the floor for a vote.
Because what Trump is doing is hurting theworking class, he's hurting manufacturing,
and he's engaged in an economicpolicy of self destruction.
If I wanted to, and I'll go yield, if Iwanted to destroy the American economy,
I would do the type of terrorist he did.
I would declare more on universities likethe one you're broadcasting for me, and

(06:23):
I would cut science andeducation funding and
I would have policies to say we don't wantany immigrants in America through fear.
And he's trying really hard.
Now, fortunately, America is a greatcountry and will survive this, but boy,
he's trying to really hurtthe American experiment.

>> Niall Ferguson (06:38):
Roy there's one thing that puzzles me because it's not like
Donald Trump concealed hisintentions from voters.
He campaigned explicitly pledgingreciprocal tariffs to take
on the universities, all the thingsthat you've just referred to.
So how do you explain the fact thatyour party lost the presidential

(06:58):
election to a man who said hewas going to do these things?

>> Congressman Ro Khanna (07:03):
I don't think voters paid attention to all the details
of what he said.
I'm not sure they believed he wasgoing to do all of the things he said.
Voters were upset with inflation.
They were upset that we didn'tdo enough on the border and
8 million undocumented ormore came across.
They were upset that for 40 years thiscountry has betrayed factory towns and

(07:25):
rural communities.
And they saw Donald Trump isat least willing to fight for
those communities, even if theydidn't look at his prescriptions.
But the good news for the Democratsnow is that we've had eight years of,
will have had eight years of Trump andit will prove empty for
the towns like Lorraine, Ohio andJohnstown, Pennsylvania.

(07:46):
That doesn't mean Democratscan win by default, but
we have an opportunity to reject the typesof things that led to the hollowing out of
those communities to offera new economic vision.
I call it a new economic patriotism.
And to earn back people's trust.
So there was a lot of discontent withthe status quo in our party, and
that's how Trump won.

>> John H. Cochrane (08:07):
I'm curious for what you did not say, cuz these tariffs were
undertaken under a declaration ofnational emergency by executive order,
which is a strange way to run a country aswell as a strange way to put in tariffs.
And so, I'm curious that you're not sayingCongress needs to take this authority
back, and not rule by executive orderunder declarations of national emergency.

(08:34):
And maybe you'll take the chance to do it.
But also, Biden kept the firstTrump tariffs in place,
which I thought was pretty sad.
Perhaps, the experience of these tariffswill be enough to have Democrats come
out and resolutely be, we are the partyof free trade next time around.
Can I hope for that?

>> Congressman Ro Khanna (08:49):
[LAUGH] Well, I agree with you on that.
It should be Congress andnot executive order.
And I guess maybe, I'm a little bitjaded about Washington, D.C, and
jaded that the speaker is actually gonnaput this bill that Bacon has for a vote.
But I'm a co sponsor of basicallyreclaiming Congress's authority on
matters of tariffs.

(09:10):
And certainly, you shouldn't havethis kind of overreach of executive
power unless there's a real emergency.
We read war, orsomething that constituted it.
It could get litigated in the courts.
But the simple thing is, for the speaker,Speaker Johnson, to put it for a vote.
I think you would get a lot ofRepublicans voting with me.
Now, look,I am not an absolute free trader.

(09:31):
I am not a protectionist.
I'm for strategic trade.
But the biggest thing is,before you can protect industry,
you need to build industry.
And this is where I believeyou need federal financing,
you need investment in DARPA and SF.
You need investment in our universities,you need investment in our workforce.
You need to say if you build it, thegovernment will buy it, as the president
did with Operation Warp Speed, and as wedid with NASA and the semiconductors.

(09:55):
And we need a comprehensive policy.
And if tariffs then are one componentof it, if we're doing hydrogen steel in
America and we wanna make surethat Europe isn't dumping it or
China isn't dumping it,I'm open to that use.
But not blanket tariffs, andnot tariffs divorced from a broader
policy like Hamilton or FDR,to build industry in this country, or

(10:15):
Reagan had with the Plaza Accords andwith SEMATECH, with semiconductors.

>> H. R. McMaster (10:20):
Yeah, thank you,
just answer the question Iwas gonna ask you actually.
Because this ties to your workon the China Select Committee or
the Select Committee onthe Chinese Communist Party.
What do you think isthe appropriate Congressman,
combination of tools ofeconomic statecraft?
Given, first of all, what you'vealready described is really the loss of
critical elements of our industrial base.

(10:41):
The degree to which supply chainshave become overly reliant on single
points of failure controlled bythe Chinese Communist Party.
I mean, what's your vision of how toemploy the various tools of economic
statecraft, export controls, tariffs,as you mentioned, investments, inbound and
outbound investments,screening and so forth.
Do you have some ideas about howCongress can help advance an agenda that

(11:05):
the counters, really China's weaponizationof its mercantile status model against us,
while preserving the advantages ofour free market economic system and
our unbridled entrepreneurship?

>> Congressman Ro Khanna (11:17):
Well, you've done a lot of excellent work
in this area andtestified in front of our committee.
But the key is, in first is, we needto maintain our technology supremacy.
We need to make sure that weare leading when it comes to AI,
when its comes to quantum andthe integration of that into our military.

(11:38):
And I thought that,Michael Bloomberg did a great report on
sort of adopting some of the emergingtechnology into the Pentagon.
And it's a long project that we need tomake sure we're at the cutting edge of
getting emerging technology in, andreform of the procurement process.
Second, we need to make surethat in critical industries,
we are developing thatin the United States.

(12:00):
I would say, advanced steel,advanced chip building,
aluminum, pill development,the semiconductors.
So in this way, Trump and I andVance share the same goal.
I just don't think his goal is going tobe achieved without federal investment,
without federal procurement,without workforce development.

(12:22):
Okay, you're gonna tariff China.
That doesn't mean the electronicmanufacturing is gonna come back to
the United States.
It's gonna go to Malaysia, Vietnam.
We need to have manufacturing hubs,and that's related to universities and
funding, forthat in the workforce to be able to do it.
And then we need to be able to sourcecritical minerals not from China.
I mean, there are allies like India andothers that have a rare earth materials,

(12:43):
critical minerals.
We need a comprehensive strategyabout how we get some of these things
not from China.

>> John H. Cochrane (12:50):
Could I ask how we're gonna do that while avoiding the litany of
boondoggles in the past?
I think the most classic example is,the California high speed train,
which was going to leapfrogour technological advance.
And here we are 15 years later,having done nothing but
build what I think will be 100 years fromnow, a monument to American inefficiency,

(13:12):
[LAUGH] viaducts fora train that never went anywhere.
Our history of doinganything with subsidies.
The Jones Act protected shipping.
We have no ship industry.
Our steel has been protected andfederally subsidized for 50 years.
We're sofar behind Japan in steel technology.
We needed them to buy US steel.
And there's costs,if you want $100 billion chip investment,

(13:36):
that means you can't buy10 aircraft carriers.
So I'm a little suspicious, not at howwonderful it would be in theory, but
how our Americangovernment is in practice,
historically unable to do anything butcreate things.
Occasionally, wonderful things, a rocketto the moon at astronomical cost, but
everything at astronomical cost.

>> Congressman Ro Khanna (13:58):
Well, I think the history of the country is one of
the federal government working withthe private sector to industrialize.
Most famously, of course, Roosevelt'sReconstruction Finance Corporation,
that basically industrialized America.
And as you know,the unemployment rate fell from 18%,
largely the new deal was fine, butdidn't really lower rates until 1941,

(14:21):
where unemployment rate falls to 4%because of the financing of a lot
of the industry in the United States.
And then, of course, this goes back toLincoln with the land grant colleges,
and his funding of the Homestead Act, and
the policies that were gonna lead tothe modernization of the economy.

(14:43):
And Hamilton, most famously withhis report on manufacturing and
his call for partnership.
But I think there are checks that we need.
One is, it should havea private sector capital match,
which you didn't have in California.
I mean,there were a lot of problems there, but
I think that provides some market checkas opposed to what China is doing.

(15:06):
And secondly, it should look toinvolving the local community and
business leaders and have efficiency andoutcome, I mean, and measurable results.
Things that Andy Grove talked about thatoften is missing in government execution.
And finally, even if there wassome small efficiency costs,

(15:31):
I believe that the national securityindependence and the social cohesion,
by not having hollowed out townsacross America is worth it.
That the unbridled free market,even if it maximizes for efficiency,
isn't maximizing fornational unity and national strength.

>> John H. Cochrane (15:52):
Sounds like JD Vance, [LAUGH].

>> Bill Whalen (15:54):
Congressman, let's talk about Silicon Valley for a minute.
It's not as it was in 2016, whenMarc Andreessen said that Hillary Clinton
was the, quote,obvious choice for president.
We saw Trump make inroads.
The question, sir, is did Trumpmake inroads based on his policy or
getting back to what Niall suggested,did he benefit from Democrat miscues?
You look at the Biden administration,

(16:16):
you see antitrust enforcementto discourage mergers,
new regulations on AI calling for taxingunrealized capital gains, and so forth.
Is there a lesson here foryour party moving forward?

>> Congressman Ro Khanna (16:27):
Well, he capitalized on a number of things.
One, I think he went to these communitiesand he said, you've been shafted and
I'm gonna speak for you.
Two, he spoke to a nostalgia in America.
I mean, look, if you were campaigning inIndia, you could never say, let's make
India great again and go back to the 1950sbecause no one would wanna go backwards.

(16:47):
But when you're a great country likeAmerica, appeals to nostalgia can work.
And he had a nostalgicappeal to a simpler life,
to a simpler economy,to a less diverse nation.
I don't think that'sultimately the American ethos.
I think the ethos is moving,future oriented.
And that's where the Democratic Partyshould contrast.

(17:09):
What we should say is, we getthe economic prosperity of the future.
We're not Luddites like Lutnick.
We don't want the screws andscrewing coming here.
We're not Luddites like the Trumpadministration, appointing an education
secretary who doesn't knowthe difference between AI and A1.
We understand the modern economy, weunderstand modern wealth generation, and
we want this everywhere.
But I think Trump spoke emotionallyto people who felt shafted,

(17:33):
ignored, leapt out of globalization.
And I think he spoke to people who left,felt that their culture was disappearing,
their way of life was disappearing,and that they weren't respected,
that they were looked downupon with elites, by elites.
And so, and he spoke candidly,he sounded the alarm on China.
I don't agree with all of his approaches,but

(17:55):
I think he was the first presidentreally to say, when he ran in 16,
that we've got to have a differentapproach on China and the China shop.
So we need to absorb all of this andhave a compelling vision going forward.
I mean, I voted forDonald Trump's impeachment twice, and
I oppose things he does.
But that's the easy part.

(18:15):
The harder part is to say,we have a messy democracy in America.
What are people telling us?
Well, it wasn't working.
And how are we going to have a visionforward that brings this country together
and learns the lessons of almost halfthe country voted For Donald Trump.

>> Niall Ferguson (18:28):
One of the things that really struck me about the election was
last year was that there were hugeswings to Trump in blue states.
And part of what we saw was a repudiationof the Democratic candidate.
But the Democratic Party, and
I think those of us who've spenttime in California get why that was.

(18:49):
We get why people in Silicon Valleyturned away from your party.
And it's because we see all aroundus the consequences of misguided
progressive policies.
I've seen San Francisco turn from one ofthe most beautiful cities in the world
into a kind of hellscape,at least in parts of the city.
And that's not the marketthat's caused that,

(19:09):
that's misguided progressive policies.
Standards of education inCalifornia are woefully low.
They're low because the teachers uniondictates what goes on in the schools in
California.
And I could go on.
The problems of California are 100%the consequence of bad governance,
which is 100% the faultof the Democratic Party.
And it's not only in California.

(19:29):
You go to Illinois andyou'll hear the same problems.
The question I have for you is,
what is your party going to doto win back the credibility?
It's not enough just tobe against Donald Trump.
You've got to rid yourself of a terribletrack record of running states
into the ground.
What's the answer to that?

>> Congressman Ro Khanna (19:47):
Well, first of all, the balance.
I agree with some of the critique, but
we've got 37 times the venturecapital of Boston and
we're producing more wealth thananywhere in the world in Silicon Valley.

>> Niall Ferguson (19:56):
Despite.

>> Congressman Ro Khanna (19:58):
No, it's because of government investing.

>> Niall Ferguson (20:00):
The miracle that the California private sector does so well,
considering what the Democratic Partydoes to screw public provision of goods.

>> John H. Cochrane (20:08):
We are living for Texas as fast as they can.

>> Congressman Ro Khanna (20:11):
It's because we're welcoming up immigrants.
It's because we investedin community colleges.
It's because of DARPA investment,of NSF investment, that the policies that
the Democratic Party stood for, which hasled to the biggest wealth generation.
And this is why I think I'll gotoe to toe with anyone to say
there's no one who represents moremodern wealth generation than I do.

(20:32):
I understand what it takesto build wealth, and
I wanna do that in creating economicindependence around the country.
Now, are there problems in public safety?
Yes, but my district hasthe safest cities in the country.
Four of them in the top 15.
Sunnyvale, Fremont,San Jose and Santa Clara.
We invest in our police, we have goodrelationships with law enforcement.

(20:55):
You have new mayors like Dan Lurie,Matt Mahan, Rod Solwan,
who prioritize publicsafety getting elected.
And then the fundamental problem though isI've had people from Silicon Valley reach
out to me say we hated Kamala,we hated Trump,
we thought we were gonnamake more money under Trump.
And I said, how is that working out?
Okay, maybe you didn't like some ofthe administrative straight of Biden.

(21:19):
At least he didn'tdestroy capital markets.
So I think the buffoonery ofthe Trump administration's economic
policy is going to createa situation where a Democrat wins.
Now the question is,are we gonna go back to the status quo and
not have self introspectionof where we made mistakes?
Some of it in the types of things you andare talking about.
And Ezra has talked about an abundanceagenda and bad regulatory policies,

(21:43):
some of it in overlookinglarge parts of this country.
And I don't want us to just go back,
I don't want our slogan to bebring America back like Biden.
I want our slogan to be we've gota great vision for the future and
introspective about places where theDemocratic Party has been wrong as well.

>> Bill Whalen (22:01):
Congressman, you recently said the Democratic Party's quote and
I quote, old guard needs to go.
Who's in the old guard?

>> Congressman Ro Khanna (22:08):
Schumer, I mean, obviously it's his decision in terms of
what he wants to do, buthe's clearly not resonating now.
I'm glad that Durbin passed the torch to,to a next generation.
I think that you've got to allow a newgeneration of leaders to step up.
Look, it's not exactly that this politicalclass has been the greatest generation.

(22:31):
I mean, the greatest generation gotWorld War I, World War and then defeated.
There was a generation that defeatedcommunism, that built civil rights.
I look at the last 40 years,what have they done?
The income inequality has skyrocketed.
We got into blunders in Iraq,blunders in Afghanistan.
It's not gonna be a greatchapter of American leadership.

(22:51):
So step aside,give a new generation a chance.

>> John H. Cochrane (22:55):
What big ideas would you recommend for that new generation?
We have gaping wounds, immigrationsystem that I think we agree is more or
less of something that's dysfunctionalneeds to be oriented around good
economic immigrants and not a sort ofan asylum system that isn't working.
We have a tax system that is not raisingmuch revenue at extraordinary marginal

(23:19):
rates.
We have entitlements that are,we either need European style taxes or
we need fundamental entitlement reform.
Are you guys ready to stand up andoffer not just as Niall suggested.
Look at the shining cities, citiesthat we're now running successfully.
Sort of the way the Republicanswill point to Texas and Florida,

(23:40):
to which many of ourbusinesses are running.
But look to us for the ability tofinally make progress on the kind of
the big gaping wounds that get passedfrom party to party as each one
votes the other one out every four years.

>> Congressman Ro Khanna (23:55):
Yeah, I'm just on the last one.
I don't think that they're allrunning to Texas or Florida.
I mean,AI is mostly in my district District.
And I would bet very strongly on SiliconValley continuing to dominate the economic
landscape over the next 15, 20 years.
The venture capital isstill in our district.
Now, I would like it to be more diffuse,but
the argument for Silicon Valley isstill very, very strong in terms

(24:19):
of the models of investing in science andresearch and immigration.
I believe that the biggest challenge for
America needs to be tacklinggeographical economic inequality and
economic inequality, that we shouldhave a Marshall Plan for America.
Looking at Lorraine, Ohio,Down River, Michigan, Johnstown,
Pennsylvania, having new tech academies,new advanced manufacturing.

(24:43):
A call for the economic renaissance ofthis country in every part of America.
I mean, Britain had the leveling upinitiative, it didn't quite take off.
But you look at the problemof western democracy,
it is a problem of eastern Germanynot keeping up with Western Germany.
Of the industrialized England notkeeping up with industrialized England.
Deindustrialized America not keepingup with the knowledge economy.

(25:05):
And you've gone in America from53rd to 128th in income inequality.
We need to solve that bybringing economic growth and
prosperity to areas that haven't hadit and by increasing, in my view,
minimum wage for working class,having higher taxes on billionaires.
And we can go back to the 97 tax rates andraise $5 trillion of revenue.

(25:30):
Now, am I open to comprehensivesolutions on these issues?
Absolutely, we should be fora comprehensive immigration reform.
I've even said that Democratsshould talk about legalization.
I'm for citizenship, butat least let's get legalization.
I mean, let's look at what can actuallyadvance the ball on some of these issues
we've been stuck in.

>> H. R. McMaster (25:49):
Hey, Congressman, can I ask you?
One aspect of this you haven'tmentioned yet is deregulation.
And of course,California is notorious for having so
many barriers to beingable to build anything.
And we have a colleague here at Hoover,Leo Hanian,
who's done a really great job of sort ofcataloging what could be done to unleash
the power of private capital and so

(26:09):
forth to get to some of the issues you'retalking about right here in California.
In terms of invigoration ofthe defense industrial base, or
industrial base broadly,as well as a supply chain resilience.
Can you see in some sort ofan bipartisan effort to support
President Trump's deregulation agenda?

>> Congressman Ro Khanna (26:30):
Do I think that there it's too hard to get
permits on things?
Absolutely, and certainly in California,but more generally.
I mean, I think this is a faircritique of the Biden administration
that was too hard to build.
I mean, the broadband bill, we candepend whether to blame Congress for
all the requirements that were put up orthe administration.
But the idea that we allocatedthat in 2021 and five years later

(26:54):
is when the first disbursementgoes out is utterly ridiculous.
So I'm not gonna defend the status quo.
What I will say is if you talkto Pat Gelsinger at Intel and
you ask him why are the Intel factoriesnot fully succeeding in Ohio,
he would put regulatory burdens andpermitting at number four or five.
He would say the biggestchallenge is Wall Street and

(27:17):
their dislike of capital expenditure.
The fact that theyhaven't been able to get
that there was not an incentive on buying.
The fact that there isn't skilledimmigrants in a workforce that's
ready to go.
So in my view, it's not that I question or
defend the regulatory bureaucracy.

(27:38):
I think it is too glib,too easy to simply say,
if only we had regulatory reform,America would build.
It's sort of like a painless solution.
We don't have to pay any money for it,
federal government doesn'thave to do anything.
It's just the bureaucracy.
And I'm not doubting thatthat's part of the challenge.
But the reality is we're gonna, in myview, have to invest in our workforce,

(27:59):
in our federal investment,in procurement policies.
And it's gonna cost money, and thatmoney needs to be raised through taxes.
And this is where I believe that thePresident Trump's agenda is insufficient.

>> Bill Whalen (28:12):
Final question for
you, Congressman Connor,we sure appreciate your time.
You've been on Capitol Hill forabout a decade now.
You're not quite 50 years old.
You clearly are interestedin the future of your party.
What's holding you backfrom running in 2028?
And if you don't wanna run,who do you think should run?
Do all signs point to AOC?

>> Congressman Ro Khanna (28:30):
Well, I believe that the Democratic Party's biggest
mistake is we really haven't had a trulycompetitive election since 2008.
I mean, we basically had Hillary Clintonthat's standing and waiting, and
Bernie Sanders put up a fight.
But that was a process where the wholeparty had coalesced around Hillary,
the whole party coalescedaround Joe Biden,
the whole party coalescedaround Kamala Harris.

(28:52):
I'll tell you, whoever the punditsthink is not gonna be the nominee,
that is my only bet.
But I'd love to see 10, 15 people.
Wes Moore, Josh Shapiro, Whitmer,Buttigieg, AOC if she wants,
I mean, whoever the people are,to run and to provide a vision and
to have a dynamic,contested battle of ideas.

(29:14):
And I hope, by the way,that's on the other side.
For the life of me,don't understand why ambitious Republicans
aren't saying Vance Trump'seconomic policy is a disaster.
And Cruz is doing it to some extent,but our Holly.
And I'm gonna have a different visionbecause I think Vance is a highly
overrated candidate.
And I think he doesn't have Trump's charm.

(29:34):
He's not gonna connect with black andLatino men the way Trump does.
And so I would like to seea contested primary on both sides
where good ideas emerge anda new generation emerges.

>> Bill Whalen (29:48):
Okay, we're gonna leave it there, Congressman, thanks for
joining us today andgood luck on Capitol Hill.

>> Congressman Ro Khanna (29:53):
Thank you, appreciate it.

>> Bill Whalen (29:56):
We now move on to the b block and a conversation about
the Trump presidency this week, includingthe 100 day mark of the Trump presidency,
which in America is a goodtime to look at progress.
Gentlemen, I want you to do two things forme.
I want you to put on your professorscaps and hand out grades.
And I want you to offer two grades,one being a specific policy area,
your expertise, andthe second being overall performance.

(30:19):
HR, let's start with you.
I want you to hand out a grade forTrump on national security and
then let's follow up withoverall performance grade.

>> H. R. McMaster (30:26):
Okay, so what I'll say, of course,
everybody's focused at this moment,many people are, anyway,
on what the course is gonnabe on Ukraine and Russia.
And on taking advantage, I think, of whatare opportunities when President Trump
came in with a Russia that wasin a profoundly weak position.
And his opportunity, I think,to put more pressure on Putin.
And maybe make more rapid and

(30:47):
sincere effective progress towarda ceasefire and an agreement.
I think President Trumphas kind of blown that.
He's blown it, he's done the oppositeof what would have been more effective,
which would be to support Ukraine andput pressure on Russian states,
put pressure on Ukraine.
And seems to be driven by this idea thathe could accommodate Russian defined,

(31:08):
Putin defined security concerns asthe best path toward an enduring peace.
So on Russia and Ukraine, I give him a D.

>> Bill Whalen (31:16):
A D, overall?

>> H. R. McMaster (31:19):
Overall, in foreign policy, I give a B,
the reason is I'm kinda comparing him towhat the alternative would have been.
And he has been able to reverse, I thinka lot of the previous policies that were
unwise, especially in the Middle Eastin particular, vis a vis the Houthis,
with the support for Israel.
And I think what will ultimately happen,which is more pressure on Iran.

(31:40):
And I think he's kind of stumblingin to the recognition that China
is the primary problem from a trade andeconomic perspective.
Hopefully, there'll be an alleviation ofsome of the higher tariffs on allies and
partners anda real focus on China is the problem.
And a thought out approach to economicstatecraft such as that we We

(32:01):
recommended in a recent paper andJohn by murder boarding us with
the other economists I think reallyhelped us improve considerably.

>> Bill Whalen (32:11):
Professor Cochrane scribbling notes as I see grade him on
economics and then give an overall grade.

>> John H. Cochrane (32:17):
The hated notepad by which I don't-

>> H. R. McMaster (32:19):
Don't ask John what
grade he would give me on that, cuz.

>> John H. Cochrane (32:22):
[LAUGH] Shows capacity for improvement listens,
that's very important.
It started great,
first day executive orders sayingwe're not gonna commit energy suicide.
We're not gonna commit suicideby regulating AI to death, and

(32:43):
then it kept going in that direction.
Yes, it's a first hundreddays of wild stuff,
big important structural issues liketaxes still remained but out of the box.
That looked great alsoasterisk out of the box,
I'm uncomfortable withrule by executive decree.
We wanna do things that last bylegislation and norms and so forth,

(33:07):
but out of the box you stop someimmediate damage from happening.
You build the economy and then you're ableto follow up to make stuff more permanent.
So that was promising, of course nowwe have the face plant of the tariffs,
an indication also ofa process not going well.

(33:28):
They seem likely to cause a bigeconomic slowdown at least if
not a recession if theyaren't pulled off quickly.
They're also a foreign policy disaster,we've pissed off all of our friends and
allies.
That will be damage,I think they will pull back and
we'll have some sort offace saving trade deal.

(33:49):
And some sort of tariffs rather thanplunge the economy into a financial crisis
and a recession,I think Trump's smart enough to do that.
But the damage is done andthat will cost him politically and for
the opportunity to keep the wonderfulstuff going and to solidify it into law.
So that's too bad, andI do wanna push back on HR,
China is a security challenge, but tradewith China is not an economic problem.

(34:14):
They send us stuff is wonderful,globalization is wonderful and necessary.
The economic problem is the securityis gonna cost us trillions of
dollars if we decouplein national security.
So be darn sure you've done yourcost benefit analysis on that one,
you wanted a grade.
It's still the midterm and so I don'tlike to tell students their final grade,

(34:38):
it's still before the midterm.
But you started well, you did real badlyon the last in class exam, room for
improvement, and we'll see if you'reable to recover from that one.

>> Bill Whalen (34:51):
So he doesn't get a grade, he gets a come see the teacher note.

>> John H. Cochrane (34:55):
Yes, come for office hours,
and we'll see if we canstraighten you out a little bit.

>> Bill Whalen (35:01):
Okay, Professor Ferguson, I want two sets of grades out of you,
one is to grade him on his performance visa vis the vibe shift, and then secondly,
the overall performance.

>> Niall Ferguson (35:10):
Well, H.L Menken once famously said, democracy is the theory
that the common people know what theywant and deserve to get it good and hard.
And that seems to me very appropriatebecause they are getting it good and hard.
I'm impressed by the fact thatPresident Trump has executed in

(35:31):
almost every single campaign pledgehe made back during the campaign.
I remember going through all 37campaign videos that he recorded,
and they covered everything fromthe border to accreditors in
higher education, to trade,reciprocal tariffs.

(35:51):
It was all there if you care to look,and you've got to give him an A for
delivering what the commonpeople voted for.
It's hard for me to think ofan administration that was so
explicit on the campaign trailabout what it was gonna do.
Normally, politicians are very vagueabout what they're gonna do in

(36:11):
the campaign trail.
You'll remember that Vice President Harrisessentially wouldn't reveal anything about
what she was gonna do.
Well, Trump gave you 37 very specificpolicies which were translated
within 100 days into executiveactions of one sort or another.
You can't deny that that's kind of howit's supposed to work and rarely does.

(36:35):
Now, if you just remind yourselfthat ultimately presidents are not
accountable to professors andwe aren't the ones giving grades,
the question is,how are the voters liking it?
What's interesting is that they'vealready cooled quite a bit,
if one looks at the most recentpolling on a variety of issues that.

(37:01):
Well, they did vote forback last year, and
that's before the economic consequencesof the tariffs have made themselves felt.
So I think we should hold back fromgiving grades, the way the system works
is that the public gives a grade nextyear in November at the midterms.
But that's not really the final wordbecause they get to vote on who

(37:23):
will succeed President Trumpanother two years after that.
It's a little early to giveout grades on results, but
in terms of delivering whathe said he was gonna do,
it's an A, I mean, he's deliveredthe way FDR delivered in 1933.
There's no question,whether you think it's gonna work or
not is a whole different question.

>> H. R. McMaster (37:43):
You could tell that Niall used to teach at Harvard where
there's really high grade inflation and[LAUGH].

>> Niall Ferguson (37:52):
I was never responsible for
that great inflation, I'll have you know.

>> John H. Cochrane (37:56):
I wanna disagree with that, remember,
FDR campaigned on balancingthe budget [LAUGH].
He definitely did not promise to do stuff,he sort of generically, well,
I'll deal with the emergency.
But he did not have a detailed campaignpromises and he broke the ones,
he did this.
We are faced with an A B choice andthat's the problem in American elections.

(38:17):
And I read this last election as wellas several of the previous ones,
primarily as voting the bums out.
Rather than endorsements of specificcampaign policy promises of Trump or
Biden when he was elected.
I think Trump is making the same mistakeas Biden did to take a fairly narrow
majority that was mostly voting againstthe previous one as a mandate for

(38:40):
every point of the policy plank.
Because people know to take him,is it seriously or
literally with a grain of salt,when he says, yeah,
let's get rid of taxes on tips.
Now that's not Hillary Clinton72 page policy proposal
worked out on how tips work.

(39:01):
It's an idea and everybody understoodthat that's kind of a general philosophy,
but not necessarily a campaign pledge.
So I think making good on those pledges,
which is he is very good atmaking good on those pledges.
But I'm not convinced that's whatpeople voted him in to do in the end.
We vote for presidents for judgment, forhow they handle problems as they arise,

(39:25):
for the events dear boy, not forenacting a preselected program.Sorry,
H.R.>> H. R. McMaster: No,
I was just gonna say I agree with you guysthat all this is a work in progress and
I don't know if we're gonna get to it.
So I just wanted to mention becausewe've had this announcement of
a three day ceasefire that Russia hasagreed to from I think 9th to 11th May.
But hey, it's Putin beingthe KGB operator again, right?

(39:46):
So after the latest onslaught,the mass murder attack on Kiev,
President Trump got angry andso they stop Vladimir.
So he's now trying to back up a littlebit, but he's trying to do so in a way by
having a ceasefire around Victory Day toprotect Victory Day, because it would be
a tremendous Tremendous embarrassmentto him if something happened then.
And what he does is he tries tocultivate this idea that, Russia and

(40:08):
the United States are just natural friendsbecause of the World War II alliance.
And of course, this is why it's reallydangerous if you don't know history or
know it only superficially.
Because the United States andthe Soviet Union were allies
in World War II only afterthe Molotov Ribbentro Act.

(40:30):
Only after the Soviet Union had no optionbut to become an ally of the United States
after the Russian, or the Nazi Germanyinvasion in Operation Barbarossa.
So anyway, I just wanted to get thatcontext out there that there is room for
improvement, right?
These grades are not final,butI hope that President Trump has come to

(40:51):
the realization that Putin is just,is trying to play him.

>> Bill Whalen (40:55):
I want to ask you guys your thoughts on three principles in
the Trump administration.
And each of these gentlemen representswhat we might call a cautionary tale.
Niall, let's begin with Marco Rubio,who I think you might agree is
the anti Henry Kissinger when itcomes to being a Secretary of state.
Is there a cautionary tale here?

>> Niall Ferguson (41:12):
Well, Marco Rubio is not the first Secretary of State to be
somewhat marginalized inthe making of foreign policy.
This is something of a tradition.
In fact,Richard Nixon did it to Bill Rogers,
who was his Secretary of State whenKissinger was National Security Adviser.
What's interesting about the Trump team isthat there is a National Security adviser,
Mike Waltz, buthe's also been sidelined so

(41:33):
that Steve Witkoff is doing most ofthe really important negotiations.
That's the interesting part here.
And I think Marco Ruby is actuallydoing okay in maintaining
a semblance of credibilityunder these circumstances.
My bet is that Wyckoff will not remain forvery long in this

(41:56):
position because he is notmaking the kind of headway that
President Trump needs to have notonly with respect to Ukraine.
But also with respect to the Middle East.
And that's not surprising because really,Steve Witkoff is in over his head
negotiating with the likesof Vladimir Putin.

(42:17):
So I think Marco Rubio is positioninghimself quite carefully for
the next phase of the presidency whenTrump admits that it's a little bit
more complex than a real estate deal.
What he's trying to do with Ukraine andindeed with Iran.

>> Bill Whalen (42:33):
All right, HR Secretary of Defense Pete Hegg said that
an alternate universe,it might be you running the Pentagon.

>> H. R. McMaster (42:39):
[LAUGH] Hey, I'll tell with the people leaving and
then making the statements and so forth.
I think what you're seeing is, is not onlydifficulties associated with the secretary
and maybe his preparedness for the job.
But also some of the people who have come,
who have come in tothe Department of Defense.
What really I find concerning and becauseI do want President Trump to succeed.

(43:04):
Is there was this firing of certainmembers of the National Security Council
staff after Laura Loomerwhispered in his ear.
Well, these were people who wereextraordinarily effective and
would have been effective at drivingthe President's policy while he was firing
these really hyper competent people.
The Department of Defense has beenpopulated by a lot of people who have been

(43:25):
funded andsupported by the Koch foundation and
who are in kind of the Neo Islanders camp.
And you know what?
Hey, President Trump is not a bigfan of the Koch Foundation.
And so I think you're seeing some of thesetensions play out in the Department of
Defense largely because of some ofthe first people they hired there.
So what I'm hoping for is they'll bringin some reasoned internationalists

(43:48):
who are on the President Trump'sside of peace through strength.
And recognize that that strength comes inlarge measure through strong alliances and
forward positioned,capable joint American forces, US Forces.
Who can demonstrate to potential enemiesthat they can't accomplish their
objectives through the use of force.
And so I've been encouraged by someof what's happening in the Pentagon.

(44:11):
Of course getting rid of allthe kind of reified philosophy,
postmodernist identity politics,critical theory nonsense.
That's good, that's a positive anda focus on, on war fighting.
That's a positive.
I think they want tostreamline procurement.
The deputy in the Department of Defense,Steve Feinberg,

(44:31):
extraordinarily capable guy.
So it's not all bad inthe Department of Defense.
But I think what's happened is theybrought in some of the wrong people
because these are people who are reallygood at insinuating themselves into
various departments and agencies.
And I hope that also the Presidentrecognizes he was being very well served
by some of those people he fired.

(44:53):
And there's been the slow takeoverof the Department of Defense who I,
by people who I don'tthink reflect his agenda.

>> Bill Whalen (44:59):
All right, this is Be Kind to John Cochran day.
I'm going to give you the big juicy one,John Elon Musk.

>> John H. Cochrane (45:04):
I thought you were going to give me Jerome Powell.
[LAUGH]>> Bill Whalen: Want take Powell if you
want to but I think Musk ismaybe more interesting here.
I think Powell's way more interesting.
Musk ran this Doge thing for a while.
It was very interesting,kind of going after numbers with it,
a very limited remit, and now he's.
He's off to other things.
So I don't know.
What else is there to say about Mr Musk?

>> Bill Whalen (45:26):
Okay.
Okay, go after Jerome Powell.

>> John H. Cochrane (45:29):
Yeah, well,
that's where this is the problemwith the Goodfellas.
I get an answer already forthe question I think that's coming,
and then you throw me a different one.
Anything intelligent to say?
Powell's the interesting guyat the moment, of course,
because the tariffs are going tobe a huge stagflationary shock.
So do you raise interestrates to fight the inflation?
Do you lower interest rates to try and
offset the damage oftariffs to the economy?

(45:50):
Which is a little bit like givinga cappuccino to someone who's had
a heart attack.
It's not obvious how lower interest ratesare going to convince someone to build
a factory when they're waiting tosee what happens with the tariffs.
But you got to give Powell immensecredit as a politician, and
I say this with reverence,with admiration.
He has steered the waters in Washington,edging just enough towards.

(46:14):
We're going to look at climate risks tothe financial system to keep the Democrats
happy without actually printing moneyto buy windmills the way other central
bankers have.
And then steers right back.
Just enough.
He's kept his job andlooks likely to keep it through two of
the greatest institutionalfailures the Fed has ever seen.
The big inflation and
then how Silicon Valley bank showedthat the whole regulatory apparatus was.

(46:37):
Was rotten.
And keeping your job is the first,
most important thing to beingeffective in the future.
So hats off to doing.
I would have been much more principledthan I would have been fired on
the second day.
So I watch that navigationwith some admiration.

>> Bill Whalen (46:55):
Okay, Niall, what about J.D. Vance?

>> Niall Ferguson (46:58):
Well, Vice President Vance and I had our disagreements early on
in this administration, andsince then he's been a little less
active on social media,which I think has to be a good sign.
He remains something ofthe administration's attack dog,
and that's especially truewhere Europe is concerned.

(47:21):
Hence his appearance in Greenland,which, of course,
the President covets as territoryhe'd rather the US Ran than Denmark.
But I do think that the role of vicepresident is an inherently difficult one.
You can just fade into irrelevance or
you can become altogether tooprominent and come to grief that way.

(47:45):
That was the fate of Spiro Agnew.
I think Vance is an importantpart of this administration.
You'll see that he's often in the signalchats that get leaked to The Atlantic.
And I think that's important because,of course he's supposed to
be the successor, andthis is a really tough thing to pull off.

(48:08):
Most of those who've attempted to go fromvice president to president have failed,
like Kamala Harris last year.
So he's worth watching,not just as vice president, but as the,
the heir presumptive.
And I think at this pointhe will ultimately stand or
fall on the success ofPresident Trump's agenda.

(48:30):
My view is that the economicconsequences of the tariffs are gonna
hit the economy hard here.
I think John and I agree andit's going to be a very tough second
half of the year forthe administration's economic agenda,
and that is also going to be a problem forVice President Vance.

>> John H. Cochrane (48:50):
I wanna follow up on that because HR mentioned
the next phase and
got me thinking what the next phase is ifthings play out as it's starting to seem.
So if you look at number of ships comingacross the ocean from China is plummeting,
you look at interviews about spendingplans of corporations, they're plummeting.
So if indeed what happens next in the nextsix months is a deep economic contraction

(49:13):
and financial one flight from Treasuries,interest rates going up.
If that's where we go next,
then I think the next phase is the ratsjumping from the sinking ship phase.
Remember, a lot of people are goingalong with how wonderful the emperor's
clothes are.
Even many people who ought to know betterare saying wonderful things about tariffs
because they know Trump's wrath.

(49:33):
But that kinda economic disasterwould be politically disastrous,
and the mechanisms for holding peoplein and loyalty fall apart quickly.
So just in all the personalities we'retalking about, and they're jockeying for
what are they gonna do next?
There is a moment in all of thesethings where the shell falls apart and

(49:56):
everyone says, my God,how do I save myself?
That will be from Palo Alto,entertaining to watch,
but for the poor people involved,big bets have to be made promptly.

>> Niall Ferguson (50:07):
Can I just say, I don't think we're talking about the right person
yet, because the most important personin the administration right now is
Treasury Secretary Scott Besant.

>> John H. Cochrane (50:16):
Yes. >> Niall Ferguson
explain that the reciprocaltariffs of Liberation Day were
about to blow up the bond market and
persuade the president to at leastpostpone the reciprocal tariffs?
We saw really quite dramaticevents in the past month.
Just because the financial crisis didn'thappen doesn't mean we didn't get

(50:40):
pretty close to it around about April 9th.
So Secretary Bessant has been a crucialplayer in stabilizing the situation and
dialing back the more aggressiveprotectionism favored by,
say, Peter Navarro.
I'm also gonna disagreewith John about Jay Powell.
Jay Powell has not, in fact,been a tremendously successful Fed chair.

(51:06):
He was too late in dealing withthe inflation problem generated in 2021.
And he is probably going to be too lateto realize that he needs to adjust
monetary policy in response to thisbig shock that you just described,
John, passing through the economy.
And when President Trump calledhim too late, Jay Powell,

(51:30):
there was some truth in that.
It's good that Trump pulled back fromfiring Powell because I think that
would have been verydisturbing to markets.
But I also want to give a shout outto our colleague Kevin Warsh for
a truly brilliant speech last weekat the International Monetary Fund.
Which set up prettypersuasively the case for

(51:53):
making him Jay Powell's successorwhen Powell's term expires next year.
So let's not forget that Trumpadministration is a shape shifting same
thing.
And the people we talk about this yearmay not be the same people we talk about
next year.
We should watch our colleague Kevin Warshand keep our fingers crossed that he does,

(52:14):
in fact, succeed Jay Powell.

>> H. R. McMaster (52:15):
And hey, just a plug here too for Kevin Hassett,
who's I'm sure doing a fantastic job, atthe NEC and then, and also Jameson Greer.
He's very competent, andhe's got his hands full.
I mean, I don't know how many bilateraltrade agreements you can do in,
like in the two month period, butI mean, that's what he's trying to do.
And we should be thankful that you've gota really competent USTR at this moment who

(52:39):
shares the President's agenda.
He's not a, he's certainly nota free trader, John [LAUGH], but
he's a good man, andI think he'll get quite a bit done.
Probably not everything he needs to getdone in terms of these bilateral trade
agreements.

>> John H. Cochrane (52:53):
I just want to thank Niall for
correcting the misimpression I gave.
The Fed has in fact gone through to and
heading into a third massiveinstitutional failures.
They went all in on treating Covid asa demand problem, not a supply problem.
Printed 3 trillion of money andhelped the treasury hand it out and
then sat on their hands foran entire year as inflation went nuts.

(53:15):
And I think, Powell is as chair,partly to blame for that.
What I was praising him for was hisability to keep his job despite all that,
which, fired or no fired, he has enoughsupport in Washington to not be fired or
not be forced out,which most mortals would have been.

>> Bill Whalen (53:36):
Gentlemen, we'll leave it there,
and we'll move on to the lightning round.
All right, first question, a week ago,
Pope Francis passed away after 12years as head of the Catholic Church.
I watched Conclave over the weekendI don't know if the three of you have
seen it or not.
I'm curious as to what you thoughtabout it, reminder, Niall,

(53:58):
that Ray Fines is reallyan excellent actor, by the way.

>> Niall Ferguson (54:00):
Yes.

>> Bill Whalen (54:01):
Question for you gentlemen I'm not sure if any of you are Catholic,
by the way, but a question.
If any of you happen to beone of the voting cardinals,
what would you be looking for in a pope?

>> Niall Ferguson (54:09):
I want to simply recuse myself as a staunch Protestant from
offering any opinion on the activitiesof the Roman Catholic Church.
I do agree with you about the quality ofRalph Fiennes's performance in Conclave,
though, that film has the most ludicrousending of any film I've seen in the last
10 years.

>> Bill Whalen (54:29):
I do agree.

>> Niall Ferguson (54:30):
And I would recommend my Catholic friends perhaps skip the last
10 minutes.

>> Bill Whalen (54:34):
Right, but what I'm getting at is really the direction of
the Catholic Church moving forward.

>> Niall Ferguson (54:39):
I'll leave that to others.

>> Bill Whalen (54:41):
[LAUGH].

>> John H. Cochrane (54:42):
I'll chime in as a lapsed Catholic and a son of a converted
Catholic who had read the minutes ofthe Council of Trent in Latin and
could quote from them.
Which has something to do with mylapse [LAUGH] from the true faith,
the Catholic Church facesa existential question.
Do we go in the direction of sortof modern woke left wing Americans

(55:06):
want to go, which many Protestantchurches have gone to?
Are we into social justice andleft wing politics.
Or do we go to the kinda traditionalCatholic religion that has,
views on homosexuality,women, the priesthood, and so
forth that aren't popular with that butare very popular, say, in Africa?
Do we, are we andincreasingly popular in the U.S.

(55:28):
we mentioned together in our lastmeeting how religion is coming back.
So I don't know the answer and no longer aCatholic, so I can't tell them what to do.
But I certainly can see what the questionis that they're going to wrestle with.

>> Bill Whalen (55:41):
HR >> H. R. McMaster
meeting Pope Francis when I traveledwith President Trump to the Vatican.
I write about that in the book, but
I also just wrote about it in a new serieson Substack called History We Don't Know.
And, in it, I reflected a littlebit on just the nature of
Pope Francis's Pontificate andhis emphasis on being a shepherd.

(56:04):
I think we could all take hisexample in terms of his humility,
his focus on service and his focuson those who are the least fortunate
in society andto try to make a real difference there.
And I then I offered some advice forwhoever comes in based
on a part of the book that wascut out of what was published.

(56:29):
And that's been a little bit ofa disappointment from my perspective in
terms of the churches taking onauthoritarian regimes and being kind
of having a soft spot for people likethose who are in charge in Cuba.
The Cuban army, Ortega Nicaragua Maduroin Venezuela, and I would say especially
the really poor decision the church madeto cave to the Chinese Communist Party and

(56:53):
allow the Chinese Communist Party tonominate bishops in that country.
So anyway, I hope that they takewhoever the new Pope is, and
I think it's quite likely that he isfrom Africa or from the Philippines or
somewhere where the Church is growing andvibrant.
Whoever comes in, though, I hope they'retougher on authoritarian regimes.

>> John H. Cochrane (57:14):
I just want to add to that, for 2,000 years, the Catholic Church
has been pretty soft on authoritarianregimes and not really a fan of democracy
and very much not a fan of markets,including the most recent Pope.
And yet democracy, freedom andmarkets have been the things that have
raised the life of the poorest amongus greater than anything else and

(57:35):
I would hope that the Churchwould discover freedom.

>> Bill Whalen (57:39):
All right, a simple yes, no, and why question deal.
Should Harvard be tax exempt?

>> Niall Ferguson (57:43):
I think that's a general question about universities, isn't
about how we treat them, and it shouldn'tbe a specific question about Harvard.
My sense is that if you remove thattax treatment from one university,
you'd have to remove it from them all.
And I can't see that that's the rightway to solve the problems that we've

(58:04):
seen not only at Harvard, butright across higher education.

>> John H. Cochrane (58:07):
I have an extreme view that we should get rid of the whole
tax exempt nonprofit structure.
So many wonderful things in America,it started as a good hearted thing, but
has now morphed into a situation wheretax exemption is a tax break break for
rich people, not forpoor people you get to give your money and
take it off your very high income taxes.

(58:29):
And it has turned into support broadly forpolitical advocacy.
So many nonprofits are either tax dodgesfor the estate tax or ways of funneling
money from taxpayers into political,partisan, political advocacy.
Universities aren't the worst, butuniversities are part of that, so I'm for
lowering the rates,broadening the base, and

(58:50):
that includes getting rid ofthe entire nonprofit system and
if you want to not make a profit,good on you don't have to make a profit.

>> Bill Whalen (58:56):
All right, our final question, Niall,
I always try to find somethingthat relates to life in the UK and
I found this wonderful story in of allplaces, the Edinburgh Evening News.
And it reports, Niall, the survey of2,000 UK residents asked to name their
favorite takeaway food, the winner wasChinese cuisine, followed by fish and
chips, pizza, Indian cuisine,American fast food.

(59:17):
Niall, if we did a dumpster divein the bins outside Shea Ferguson,
would we find oodles andoodles of Chinese takeout boxes?

>> Niall Ferguson (59:24):
Well, this is a sign that the CCP's reach and their plan for
world domination is boundless.
Of course, all good Edinburgh andGlasgow boys eat haggis suppers if
they get the chance, andthat can't be obtained outside Scotland.
Haggis supper for those interestedis consists of a deep fried haggis,

(59:44):
which is of course the Scottishnational dish combined with
what Americans call French fries.
And if you have never had a haggis supper,
you've never really testedyour cardiovascular system.

>> Bill Whalen (59:57):
It's also the classic example of don't know what you're eating,
you don't want to knowwhat hug is exactly is.
HR, what's your favorite to go food?

>> H. R. McMaster (01:00:04):
I'll say I do love Asian food, I think it's great for
takeout.
Some foods that you like are, I thinkare the best sometimes they just don't
travel well, soI think Asian food is good.
But also, lately you'll hear in Palo Alto,I've been trying,
I've been trying toslim down a little bit.
I don't know if you guys have noticed butI'm trying to switch to

(01:00:27):
maybe some sushi and Japanese foodwithin the genre of Asian food.

>> Bill Whalen (01:00:32):
John, >> Niall Ferguson

>> John H. Cochrane (01:00:35):
Yeah, I should lie and say burgers.
No chicken fried steak with fries and
gooey sauce over the fries,that's America.

>> H. R. McMaster (01:00:45):
Sausage gravy, put some sausage gravy on that.

>> John H. Cochrane (01:00:48):
Or, fish and chips, I love a good fish and chips, but
it has to be out of the fryer.
So we tend to go for sushi, which isdelicious and travels well and of course,
pizza, which you increasingly can getpretty darn good Italian style pizza
in the US, I'm a snob, having spenta lot of my childhood in Florence.
But a lot of that graces the recycling binoutside the Corcoran Pharma household.

>> Bill Whalen (01:01:14):
John and HR Raise important points, so
much good food that you order to go justdoesn't translate when it comes home,
I don't know if it's because it's stuffedin a styrofoam or plastic box or not.
And John, you're right about pizza, it'skind of idiot proof when you get to end of
the day,let's close the show by sticking with you.

>> John H. Cochrane (01:01:27):
No, pizza has to be made with really good ingredients by
someone who knows what they're doing, andwhen you order it, turn the oven on so
you can bring it in andhave it hot when it comes out.
Then you pour olive oil over it,you must have extra olive oil and
say three pears facing Rome andhope you get something pretty good.

>> Bill Whalen (01:01:44):
Well, you do live in Palo Alto, don't you?
John, let's close the show.
Tell us what you're doing in Boston,what's going on in the Cochran family and
also why don't you touch on somethingthat's happened in Massachusetts in April,
a historical commemoration.

>> John H. Cochrane (01:01:56):
I am in Lexington, Massachusetts, anxiously awaiting
the arrival of our second grandchild,which I look forward to.
And it does bring to mind, we are inLexington, Massachusetts, where a week ago
they reenacted the Battle of Lexington andConcord, which we should be celebrating.
It was strangely silent aroundthe country around this most important
celebration here.
I wasn't here, but

(01:02:17):
I gather they celebrated it atthe historically correct time.
The celebration was at 5 o'clock inthe morning along with a reenactment.
So that is something weshould take joy in this week.
Also, I think we should takea little thought and sorrow.
It's the 50th anniversary of the fall ofSaigon and the end of the Vietnam War.
So important anniversaries come andtime to remember who we are and

(01:02:38):
where we came from.

>> Bill Whalen (01:02:39):
Okay, well said, gentlemen, that we bid ado for this
episode of Goodfellows but we will be backsoon with new topics, new conversation.
Until then, take care andas always, thanks for watching.
[MUSIC]

>> Presenter (01:02:54):
If you enjoyed this show and are interested in watching more
content featuring HR McMaster, watchBattlegrounds also [e-mail].