All-In with Chamath, Jason, Sacks & Friedberg - Trump's Big Week: Middle East Trip, China Deal, Pharma EO, "Big, Beautiful Bill" with Ben Shapiro

Episode Date: May 17, 2025

(0:00) The Besties welcome Ben Shapiro! (1:53) A Bestie apology to Phil Hellmuth, All-In Poker Tournament (7:58) Trump's majorly consequential Middle East trip: Saudi, Qatar, Iran, and his vision for a "New Middle East" (35:18) US-China deal: is the tide turning on tariffs? (46:33) GOP divided over "Big, Beautiful Bill" due to its impact on our debt spiral (1:18:48) Science Corner: Montana bans cell-based meat, joining Florida and others (1:24:31) Trump's EO on pharma prices: role of PBMs, is this too much government intervention? Follow Ben Shapiro: https://x.com/benshapiro Follow the besties: https://x.com/chamath https://x.com/Jason https://x.com/DavidSacks https://x.com/friedberg Follow on X: https://x.com/theallinpod Follow on Instagram: https://www.instagram.com/theallinpod Follow on TikTok: https://www.tiktok.com/@theallinpod Follow on LinkedIn: https://www.linkedin.com/company/allinpod Intro Music Credit: https://rb.gy/tppkzl https://x.com/yung_spielburg Intro Video Credit: https://x.com/TheZachEffect Referenced in the show: https://www.whitehouse.gov/fact-sheets/2025/05/fact-sheet-president-donald-j-trump-secures-historic-1-2-trillion-economic-commitment-in-qatar https://www.whitehouse.gov/fact-sheets/2025/05/fact-sheet-president-donald-j-trump-secures-historic-600-billion-investment-commitment-in-saudi-arabia https://www.whitehouse.gov/articles/2025/05/in-riyadh-president-trump-charts-the-course-for-a-prosperous-future-in-the-middle-east https://www.semafor.com/article/05/16/2025/qatar-commits-more-than-200-billion-in-us-investment https://www.cnbc.com/2025/05/13/trump-saudi-investment-speech.html https://www.cnbc.com/2025/05/13/trump-says-us-will-remove-all-sanctions-on-syria.html https://www.reuters.com/world/what-have-china-united-states-agreed-geneva-2025-05-12 https://www.cnn.com/2019/07/02/politics/donald-trump-dictators-kim-jong-un-vladimir-putin https://newrepublic.com/post/185836/trump-brags-dictators-orban-debate-harris https://www.cnbc.com/quotes/US30Y https://www.politico.com/live-updates/2025/05/14/congress/the-titanic-johnson-predicts-houses-big-beautiful-reconciliation-bill-will-sink-in-the-senate-00348310 https://fred.stlouisfed.org/series/GFDEBTN https://fred.stlouisfed.org/series/GFDEGDQ188S https://www.nytimes.com/2025/05/12/opinion/josh-hawley-dont-cut-medicaid.html https://www.whitehouse.gov/fact-sheets/2025/05/fact-sheet-president-donald-j-trump-announces-actions-to-put-american-patients-first-by-lowering-drug-prices-and-stopping-foreign-free-riding-on-american-pharmaceutical-innovation/

All right, everybody today on the all in podcast, we're joined by our friend Ben Shapiro, and we have a full docket, including Trump's trip to the Middle East, the executive order on pharma benefits, we talked a little bit about mock meat being banned in Montana. And Friedberg is really upset he drops a distraction on the tax bill being supported by Republicans. All that and more on the number one podcast in the world. All in podcast stick with us. One thing I'm trying to figure out, do Daily Mail stories actually end? Because I've scrolled up like seven times. No, no, no. And then eight times, they never end. Those guys are like the methamphetamine of clicks. It's like click crack. Yeah, they're like one more paragraph. Every time I see a Daily Mail article, I'm like, okay,

do I have 15 minutes here? Because I'm gonna click on one, I'm gonna look at the photos, and I'm gonna go to the right rail, I'm gonna click on nine other articles. Oh, you're on the right rail. See, that's disgratsiade. When you go on the right rail, you're a true degenerate.

Oh, I love it, yeah. Stay off the right rail of the Daily Mail. That will keep you on the carousel for hours. Oh my God. They call it the carousel. My favorite Daily Mail story, one time that Jared and Ivanka were over at our house and the paparazzi were following them around. They like, can you give us a tour of the area? So drove them outside for a hot second in the paparazzi immediately

captured a picture of them on the back of our golf cart because we're in Florida and me and my son in the front and the Daily Mail. It was Daily Mail paparazzi. And so the headline was Jared Ivanka unnamed driver and small boy If you want to come to our next event, it's the All In Summit in Los Angeles, fourth year for All In Summit. Go to allin.com slash events to apply. Hold on one second. Let me do the intro properly. Ben, this is going to be so good right now.

You're going to feel so uncomfortable. It's going to be amazing. Go ahead. It's going to be great. So look, Ben has a hard out in an hour and 40 minutes. So we're going to get the show started. However, Ben, we need to take a pause. Jason will explain what happened last week. He's going to issue a formal apology.

If that formal apology is not good enough, I will step in over to you, Jason. Okay. We the members of the All In podcast, including Shamath Palihapitiya and myself, Jason Kalakandis, would like to formally and respectfully apologize to poker legend Phil Hellmuth for our previous comments about his relationship with Hollywood actor, Timothée Chalamet, and the Los Angeles celebrity community more generally. On a previous episode of this podcast, a number of inaccurate potentially legally actionable statements were made by the host regarding Mr. Helmuth. It was strongly

implied on this program that Mr. Helmuth was not acquainted with Mr. Chalamet. And it was further suggested that he had arrest and manheld of the Oscar nominated performer during a social event in Miami, Florida. This was a flagrant misrepresentation of the facts for which we are sorry. We here at All In are committed to journalistic responsibility and integrity, and we hope to use this time to correct the record. In fact, as a noted Bonvivan and publicly visible representative of the gaming community, Mr. Helmuth is acquainted with many celebrities from the worlds of film, television, athletics finance and beyond the list of some

Celebrity friends it's far too vast to list here in its entirety But we have prepared this section we feel demonstrates how his overwhelming popularity among this Demographic Matt Damon Steve Martin Charles Barkley, Bill Clinton, Chloe Kardashian, Mr. Beast, the guy from Billions, Tiger Woods, Mario Lopez, Drake, and of course, Jay-Z. Once again, we here at All In regret the error, we should publicly apologize to Mr. Helmuth

and recommit ourselves to truth and accuracy in reporting. Thank you. Jason, that was great. I would just like to add a couple of things. Phil is my best friend, has been for a very long time. I love him. He does have a lot of friends and he opens his Rolodex to us.

And so to the extent that Phil was hurt, cause he was a little bit hurt last week cause we were ribbing him. We rib him a lot. We make jokes in the group chat a lot, but it's because we enjoy it. He enjoys it. But I think the way because we enjoy it, he enjoys it. But I think the way that we said it really hurt his feelings.

So Philly, I love you, we love you. We love you, Phil, we're sorry. Sorry, I specifically am sorry because to be honest, I probably started the whole thing and got everybody, yeah. We just run out of time with you, Phil, sorry, we love you. Love you, Phil. I called you a panda eating bamboo. And I did not mean to say that you put your meat hooks

into Timothy Chalamet. And I didn't mean to say that you took credit for, and didn't have a major contribution to the All In Podcast, obviously. But Phil, honestly, you're the best. You've been really instrumental in a lot of these important relationships that have joined our group.

So thank you, and we love you you and let's keep going, okay? Yes, absolutely. And we wish you well in the World Series of Poker. Go get him. Hope you hit your eight, 17th, 18th, 19th, who knows? He's not playing this year. Isn't he skipping? He's not playing in the main event.

No, he's not playing the main. He's not playing the main because the WSOP are ridiculous in how they set up these tournaments. It's stupid. We will do a better version by the way of the WSOP to announce this. We will be doing an event during the F1 in Las Vegas where we will be launching our poker tournaments.

So for those of you who would like to have some quality high-class poker tournaments and some ridiculous cash games, let us know late November, guys. Book it. Make sure you got five, six days where you can pretend you have COVID. Get out of your job. What about you, Ben? Do you like to gamble? You ever play the horses, the ponies? I can't say that I've been big on the gambling. It hasn't worked out well for me. I have an addiction. So I wouldn't want that to get out of control, you know? All right, well, we will absolutely take advantage

of your addiction. Oh, Ben, have you ever rolled the dice? Have you ever rolled dice? No? I've never rolled dice, no. Okay, so this is perfect. We have to take, okay, Ben, you're coming to our all-in event in Vegas, and I'll tell you why.

We'll do something on stage, but more importantly for me, more importantly for me, there is an incredible rule in craps where when you have a virgin shooter, somebody who's never touched the dice, I don't know what it is, but you are the people that go off where you can make millions. Yes.

I have seen this 20 times in my gambling life in Las Vegas. I remember I took my father-in-law, I took my father-in-law and my kids while my wife was pregnant. She was like, get out of the house. My father-in-law, I took the three older kids to Vegas. He had never shot dice before. He touched the dice, broke the casino. It is the most fun game, Ben, I'm telling you. So you need to come November 22nd. We'll make the arrangements. We'll make sure you get out there. You'll have a really great time. You'll do something with us on stage. And Ben is going to touch those little dice and he's going to break the win and I'm going to be there to finance it.

Absolutely. You are going to get such great parenting and husband advice from Chamath. Ben, all of this dedication you have to your family, we're going to teach you a new approach. Just to just go off to Vegas and yeah, take your kids and your father-in-law and leave your pregnant wife at home. She's just got work to do. All right, everybody. Welcome back to the All In Podcast.

Really excited to have Ben Shap welcome back to the all in podcast really excited to have Ben Shapiro back on the program. Now listen to the Ben Shapiro show, you know, about daily wire. And Ben, you've been covering this Trump Middle East trip all week. So let's get into that as our first topic here. As everybody knows, Trump was in the Middle East, he secured a huge investment from the Saudis $600 billion, $140 billion for a defense partnership, and MBS said he wants to make it a trillion. A bunch of high-profile CEOs joined Trump, including friends of the show,

Elon and, of course, Dara from Uber, Andy Jassy from Amazon, who else was there? Alex Carp, Jensen, tons of people, including our fourth bestie here, David Sacks was there. He also closed a $200 billion deal with Qatar or Qatar, which includes 96 billion from Boeing to send 160 planes there with an option of 50 more. And he removed sanctions against Syria. Little controversial. We'll get into that. To quote, give them a chance at greatness.

He gave a speech at a Saudi US investment forum in Riyadh, where he powerfully outlined his vision for a new Middle East, basically rejecting 20 years of American interventions and forever wars. And he gave big credit to a quote new generation of leaders including MBS for building better societies. Ben what do you think here what was your take on the trip is this the best Trump of all the versions of Trump this did seem to me to be the best version he seemed really comfortable with this category of leader in this region in particular? Oh, for sure.

I mean, there's no question about that, right? I mean, he likes MBS. He obviously likes the Emir of Qatar. He likes the folks in UAE. We've known that for a while, and he's really signaling a shift away from the Obama-Biden policy toward a lot of these places where Biden liked to say the word democracy

and then immediately divide off from Saudi Arabia on the basis of that and chide MBS and all this kind of stuff. And then try to cut a deal with Iran, for example, at the same exact time, which of course pisses off the Saudis. Trump is going over there and he's in deal-making mode. And you can see he's in deal-making mode.

And his entire sort of approach to the Middle East is what he said in the speech, commerce above chaos, right? Let's do some business here. And he understands that there are a lot of people in KSA, in Kingdom of Saudi Arabia, and also in Qatar, UAE as well, who are really looking to do business. And I think there are a bunch of strategic aspects of this that are really good.

One of them, obviously, is driving these places away from China. And the more business ties you have with places like Saudi Arabia or Bahrain, UAE, Qatar, the further away they're going to get from China. I think you do have to be careful with Qatar in particular, which has some divided priorities, shall we say. When it comes to terrorism, obviously Qatar, the case they will make to sort of steel man what Qatar says about itself is that they have to have good relations with terrorists so that the West can talk with the terrorists on occasion.

To not steel man the case, they gave $2 billion to Hamas over the course of the last several years and have funded the American University systems The tune of six point three billion dollars for a country that has a grand total of two point six million citizens It's smaller than the state of Connecticut in terms of its citizenship It's spent something like two-thirds what China spends on lobbying which seems, you know pretty weird But with that said the idea of bringing dollars into the United States Combining on things like AI is what David's acts has been working on over there Like that stuff is all really, really good.

The warning that I had issued to President Trump is just make sure that you have strings attached too. Meaning clearly there are strings attached from the other side when you're talking about Qatar. So also the United States should have strings attached. So you mentioned Syria there. If you're talking about, you know, getting rid of the sanctions on Syria,

there's an argument to be made. Obviously Erdogan in Turkey would love that because basically the leader of Syria now, al-Jilani, he changed his name. He's kind of like the prince of terrorists, right? He's the artist formerly known as al-Jilani. Now he's al-Sharai, thank goodness he changed his name to. He was al-Qaeda, then he was ISIS, then he's HDS. He basically works for the Turks. And so obviously the Turks would love for al-Jilani to have sanctions removed. That's fine I mean, I think there's a case to be made for it But you have to make sure that he actually delivers on the other end of that which would be getting rid of the terrorists in

His country. What do you think Ben about? Qatar Qatar For people it's it's the same word just said differently here in the West and in their country Do you think we should have deep ties to them in his the steelman argument that their relationship with hummus and the muslim brotherhood acceptable to you ben shapiro or do you think we should hold the line with them say hey you gotta cut off these relationships if you want to have a relationship with the united states

i mean it seems to me that we have a lot more leverage in in the latter situation and and katar has obviously paying some eight billion dollars to have this airbase on its own territory, but then puts restrictions on how the United States can use that sort of airbase. That airbase was previously located in Saudi. And so, you know, it's my perspective that after October 7th, for example, the United States under Joe Biden should have gone to Qatar, which obviously has a deep relationship with Hamas, as proven by the release of that American hostage, while President Trump was in the Middle East,

which was done at the behest of Qatar, that probably the United States should have gone to Qatar and said, listen, the air base goes away unless all the hostages come out and the Hamas leadership goes into exile and you avoid the entire war. So there is leverage that can be exerted. I'm not sure that the leverage

is being properly exerted on Qatar. Let's put it this way, I'm much more enthusiastic about the ties that President Trump is fostering with Saudi and UAE than I am the ties that he's fostering with Qatar. I mean, back in 2017, there was nearly a war between Saudi and UAE and Qatar. I mean, that's how bad the relations were back in 2017. And President Trump was on the Saudi UAE side of that. So moving, let's just say trust but verify, I think would be a much better strategy than

just trust. Here's some stuff. We'll hope that you give us back on the back end. Jamath, let's go to the business side here. Trump making a lot of deals, a little bit of a brouhaha over a $400 million playing given to Trump. I'm not sure how relevant that is or if he's even accepted it personally. And I'm sure you've got some thoughts on that. But what did we see there? I saw Sandeep, our friend from Grok, one of your

investments was there, we're seeing a level of investment in collaboration between Saudi, UAE, and America, and the West that, hey, let's face it, we haven't ever seen. And they do seem to be leaning more towards, I wouldn't say democracy, but a lot of social reforms and a lot of women, what was pointed out by David Sachs in the business community there, I've made a couple of trips there. It seems to have changed on a human rights basis more in the last three or four years

than in the last, I guess, 20. So what's your take generally on this position Ben has of, hey, better they be doing business with us and let's build and foster these relationships as opposed to having them fall into the arms of Russia, North Korea or China. Let's just go do a little cleanup on a couple of these things. And I'll give you my take. Sure. First thing is we announced almost $2 billion deal 1.7 I think, but it was what it

was. This is Grok did a deal. Yeah, for AI inference. We're starting to build some enormous data centers in Saudi. I'll get to why Saudi is a critical place to do that, but they've been exceptional partners. We are the only inference company in the world with an export license from the United States to do this. So yeah, it was great.

That's why Sunny was there. And Jonathan Ross, our founder and CEO. So that was really big for us. This has been company that Jonathan and I got off the ground 10 years ago. It's been a long, long slug. So yeah, there's a lot of commercial activity that happened there.

Our friend Brian Yucco, who was just announced as the head of the commercial plane development group at Boeing, who's making all the next generation planes. Boeing was there. Kelly Ortberg, they announced a 160 billion dollar deal for Boeing's and a bunch of other stuff. Elon announced that Saudi allows Starlink now for maritime and aircraft usage. He also announced RoboTaxaxis are coming to Saudi. So the business community, I think was quite central to this trip, which is cool. With respect to the plane, just to do some cleanup,

this is a gift that is being handled between the Department of Defense and the Department of Defense of Qatar. If and when that plane does get transferred over, it will then be scanned and retrofitted to military-grade spec that then can be used by the then sitting president of the United States. And while people want to be up in arms,

just to be clear, this has happened, and Qatar specifically has done this, multiple other occasions. You may dispute the countries, you may not like the fact that it's happened, but they've given a plane as a gift to the leader of Iraq, to the then sitting leader of Turkey, to the then sitting leader, I believe, of Yemen. So there are customs, I guess, and again, who am I to judge

these customs, but that to us may seem excessive or untoward, or maybe an attempt to graft, but to them is just actually a sign of deep respect or relationship building. I think that we should not over judge this thing and let the DOD do their job. And it's a gift to the United States of America and move on. I don't think it's a particularly big deal. What is the big deal? Here is what Trump did that I think is historic. I think the most important thing to recognize is that we, America, has been a global hegemon

since World War II. But I think that what we did was we took our eye off the ball and over the last 20 years and particularly the last 17, we have seen China slowly erode our global influence through an initiative that they frankly were very open and honest about and branded called Belt and Road. And in Belt and Road 1.0, what China did was use the balance sheet of China to invest incredibly aggressively and thoughtfully in all these critical geographies of the world,

Southeast Asia, the Middle East and Africa. Specifically in the Middle East, and specifically between Saudi and Qatar, China I think has invested about $200 billion over the last 15 years. What does that do? It allows them to exert influence and economic cooperation, hard power and soft power, right? In one week, the sitting president of the United States announced $2 trillion of investment from those countries into the United States. What does that effectively do? I think what that effectively does is say

that the Middle East is turning a page, that they are beyond these regional conflicts, that they wanna thrive as a society, and that they are 100% aligned with the United States. How do you know that? Because I don't think that there's another $2 trillion of deals to be done with any other country other than America. That's number one. And then number two, the reciprocation of how American companies are investing in that region is to the tune of several hundred billion dollars. Now, why is that region

critical? It's critical for two things. The first is that when you draw a thousand mile radius around Saudi Arabia, you touch four billion human beings. Four. Half the global population is within a thousand mile radius of Saudi. And so if you can establish cooperation and strategic alignment with that area, it is an incredibly important thing to do. The Saudi coastline, as an example, is thousands and thousands of miles. These are all these huge strategic things that we've known in the context of other conflicts and other geopolitical things that we've done for decades. But what Trump basically did was clean the slate. He wiped the floor with all this neocon

establishment nonsense. That's what his speech did, which we can talk about in a second. But he created and forged an economic alliance that I think is going to be very difficult for any other country to undo. That is what I saw. $2 trillion. That is an enormous bet for country to make on it with another country. And I think the fact that he did that with Saudi and Qatar and UAE speaks a lot to a really important strategy. Freeberg, your thoughts on this trip and the growing and deepening relationship between UAE, Saudi and the United States and apparently Qatar as well. I think the biggest moment was the speech that Trump gave. It underscored, I think, a really important narrative shift for me.

This was a powerful embrace of Saudi, Qatar, of their choices, their way of life, their way of being, basically showing, I would say, respect to those peoples without judgment, which I think is quite different from leadership of the past. I'll just highlight the mainstream media narrative is, oh my gosh, Trump goes to Russia, Trump goes to China, he goes to North Korea, he goes to Saudi, he embraces dictators. So the narrative has been that these individuals in leadership positions in these countries are dictators and Trump embraces dictators.

He loves Xi, he loves Putin, he loves Kim Jong-un, he loves MBS, that's a bad thing. Because the liberal view, and I would say largely the American view in the past has been that there's right and there's wrong. There's our way of governing, and then there's the other way of governing, and the other way of governing is always wrong.

That our form of American democracy is the only model that is right, and all the others have to be wrong. And fundamentally, that's a colonial mindset is what he's highlighting in this speech. democracy is the only model that is right, and all the others have to be wrong. And fundamentally, that's a colonial mindset is what he's highlighting in this speech. He's saying that the point of view that all others are wrong means that they should come around to our point of view, our model of democracy, our model of governing. And in the speech, he basically underscored that that's not really the case anymore.

We are no longer going to be colonizersizers where we are going to enforce our view of Government on the rest of the world and say this is the only good path But there are other paths and we can respect them We can work together so long as we aren't harming one another so long as terrorism goes away Which he underscored in his speech has gone away. And by the way, I'm not trying to highlight or kind of prop Trump up for the speech itself. But I do think that this underscores a shift in the political viewpoint that has now come to power in America, that, you know, we are no longer going to have this kind of moral or socio-political framework that says it's our

way or the highway, but we are now going to go to folks like Xi, like North Korea, like China, and say we can respect your way of living, we can respect your way of governing, and we can have partnership and continue to build a world together without saying that if you don't follow our path, we're never gonna be true partners. So for me, the biggest thing that came out

of this whole visit was that shift in narrative that I think really is different than what we've seen in the past. And it counters a lot of how the mainstream media has kind of, you know, framed his quote, embrace of, you know, different ways of governance. Ben, this was obviously a Republican position as well. You know, just we're going to have a hard line on human rights and democracy. And in fact, the entire Republican position in terms of and globalist Clinton to was Hey, let's embrace China, and we will lean them towards democracy that obviously

didn't happen. They did build a vibrant economy and took 400 500 million people out of poverty into a middle class. But here we're seeing something different. You know, I've spent a lot of time in the region, maybe four or five trips in the last couple years. Last couple of times I was there, women doing business, dancing music, and now there's alcohol in the kingdom in some select locations for a casino coming to UAE, we're actually seeing maybe this strategy of less judgment, more engagement actually result in more modernization. So what's your take on this? I mean, I think that one of the things that's happened in the media coverage of President Trump's speech is this sort of false binary

that isn't really what's going on. So it was sort of posited as neoconism versus isolationism. And he mentioned both of those sorts of concepts in his speech. But the reality is that I think we should be careful about how we define these terms. What we really mean is that Wilsonian interventionism has been completely rejected by the American people and by President Trump. President Trump is saying that we are not going to go into these. To pretend that President Trump is being isolationist is obviously not true. I mean, he's literally cutting trillion dollar deals with foreign countries and traveling

there and making common bonds with them. It's the opposite of isolationism in a lot of ways. It's a realism, right? He's a foreign policy realist who wants to make deals where he can make deals and he wants to make the best deal for America. You're correct. It's the exact opposite of isolation. If they're doing projects, you know, in the Trump family and the plane, this is the opposite

of isolationism. Right, exactly. And so I think that all the debates that are currently plane. This is the opposite of isolationism. Right, exactly. And so I think that all the debates that are currently happening within sort of the Republican ecosystem are sort of which version of realism are we pursuing, right? There's a more hawkish version of realism that suggests that you ought to be more skeptical.

I mean, I think that's where I am of what you want from these countries in addition to the money. And then there's a sort of more dovish realism that says, you know, basically as long as the deals go forward, maybe no strings attached. And that's an interesting debate. And it depends on sort of more dovish realism that says, you know, basically as long as the deals go forward, maybe no strings attached. And that's an interesting debate.

And it depends on sort of what levels of trust you have in various countries. And again, I think it differs country to country. How would you measure it? Ben, I want to build on what you're saying and just ask a question because I completely agree that that rejection has all of these downstream consequences. The most interesting consequence for me,

but I would just like your opinion on this, is Trump goes there, cuts all these deals, announces all of it. There's just an incredible show of force, frankly, right? Economic force and political alignment. And then within one or two days, Iran caves. Now, we don't know what the final contours of that deal are going to look like, but that also has incredibly important implications to the safety and security, not just of that region, but for everybody. I don't know what you thought about just how quickly it seemed that there was a capitulation. This is where, again, I remain pretty skeptical. I think that one of the issues that we have when it comes to negotiations with Iran, the

sort of phrase that's been used by Saudi, Israel, UAE with regard to Iran, is Iran has never won a war or lost a piece So Iran is very good negotiation there They're quite sophisticated and how these they approach these issues and when President Trump says they can't have a nuclear weapon That's all we need to know all the rest its details but actually when it comes to things like negotiating a nuclear deal the devil is the details because is it going to be JCPOA part 2 which Is basically you can enrich to civilian levels with a certain level of transparency be JCPOA part two, which is basically you can enrich to civilian levels with a certain level of transparency, but also you get money and the money can be used for terrorism or

for ballistic missile development or rebuilding your air defenses. And what do those details actually look like? And obviously Qatar is very, very close with the Islamic Republic of Iran. And so they've been negotiating again as sort of a representative of Iran in those negotiations. And so I'm going to hold off. Let's just say I'll be skeptical until... Yeah, I mean, I agree with you. They need to be in the penalty box for some number of years because they have not earned the trust of the world in that they can conform to these things and they're not going to do nefarious things once they get access to capital and

funds. So to your point, they have to earn their way out for sure. That's right. And I think that when you look at Saudi Arabia, I think that one of the things that would be interesting to see is President Trump said in his speech in Saudi Arabia that he would consider it an honor if they would join the Abraham Accords. His signal accomplishment, obviously, during his first administration was the Abraham Accords. The notion that he, again, continued to press forward that commerce matters more than sort of ideological conflict, right? That's why UAE and Israel, for example, now have a pretty solid relationship that's withstood a lot of the stressors that have been created by October 7th and the ensuing war. The question of whether Saudi actually does that is an interesting

one, because if you're looking for a new region in which commerce really does take the floor, then obviously UAE, Saudi, they're very close. I mean, essentially UAE is a client state. There's no distinction. There's no distinction. There's no better place, I think, in the world right now if you're trying to find a net new place to put capital to work than the UAE and then Saudi. Yeah, I mean, I agree with that.

And I think that, you know, obviously integrating the region across religious boundaries would be a very, very good thing. And I think President Trump also has an interest in that. So it'll be interesting to see how things develop from here. Now, I could, it'll be, again, I remain skeptical of sort of the idea that just commerce alone is going to usher in a new era.

I do think that the United States typically, when it's brokering these deals, does put its thumb on the scale in particular ways. And those ways are not just putting money into KSA or taking money out of KSA, which again, I'm great with that. I think it's brilliant what President Trump is doing. I know a number of businesses, obviously, that are working in Riyadh and doing wonderful work in Riyadh. And I think what MBS has done, transformatively, to KSA is incredible. If what you're looking for is a broader sort of regional column that's going to last the

course of time, what you don't need is an upsurgent Muslim Brotherhood or a resurgent Iran or the rebuilding of terrorist groups that threaten both Saudi Arabia as well as Israel and other Sunni allies in the region. And so, you know, I think that there are a couple of ways to see what President Trump is doing. One of them is I hope that there's a step to right, which is, okay, now Saudi Arabia, we have a great relationship with you. It would be really great if you did join in Abraham Accords. And now you have this very strong regional block that economically is more interdependent, which is, of course, what he pursued during his first administration. Or is he moving in a direction, and this is also plausible,

where he's basically saying, listen, everybody's sort of on their own. We're going to cut independent deals with each one of these nations in bilateral fashion with the United States. And I think it sort of remains to be seen which strategy President Trump is taking, sort of bilateral approach to relations with each one of these countries individually, or whether he's attempting to forge more of an interdependent, regional economic block. The first time that the United States signed the deal, it was in the early 2000s, and it was a very important time for the United States to sort of get the deal through. And so, it was a very important time for the United States to sort of get the deal through.

And so, it was a very important time for the United States to sort of get the deal through. And so, it was a very important time for the United States to sort of get the deal through. And so, it was a very important time for the United States to sort of get the deal through. And so, it is a shift in tone for President Trump.

Abraham Accords was considered sort of his signal foreign policy accomplishment during term one. And it's my belief that if he'd been reelected in 2020 by February 2021, I think Saudi would have been in the Abraham Accords. Obviously, one of the obstacles continues to be the war in Gaza, what actually ends up emerging there. But one, ironically, one of the things that actually has undermined the kind of incentive for Saudi to join the Abraham Accords is Israel's complete devastation of all of the proxies of Iran.

So one of the things that was driving Saudi and Israel together was the fact that there was this really giant threat in Iran. And so now it appears, it could be at least plausibly read, that one of the reasons why President Trump is selling $150 billion worth of military hardware to KSA is to provide a defensive barrier against Iran while assuming that maybe Iran does end up going nuclear. So what happens with Iran does have serious ramifications for the possibility of an Abraham accord, including Saudi Arabia. That seems like it's more distant than it was a couple of years ago. And it may take more time than I think that special envoy Steve Whitcoff and the Trump administration would like it to be.

As far as the plane kerfuffle, on my show I said that it looks skeezy, you know, and I will maintain that position. It doesn't have to be that it's illegal in order for it not to look particularly good because of course the other half of the deal is that once the plane is retrofitted and used by the president for a certain period of years, it then goes to the Trump presidential library. And that was one of the conditions of the gifting. And Qatar is quite famous for putting a lot of money in a lot of various pockets, ranging from the attorney, I mean, the current attorney general of the United States, Pam Bondi was a foreign registered agent for Qatar

for a while, being paid by Qatar to do that sort of lobbying work. Qatar is pretty famous for putting its money in a variety of pockets. By the way, just to put a number on that, Qatar sovereign wealth fund, the QIA, the investment authority, it's about a half trillion dollars of capital, about 50 billion of which is invested in US funds. And many of the folks in and around the circles that are associated with the White House, obviously have QIA as an LP or have had funds that they're affiliated with that have QIAs and LP.

And my point about this is that put aside whatever moral qualms, you know, anybody has about this sort of stuff, which again, you can argue either way. The key to me is if you like President Trump's agenda, the biggest obstacle to President Trump's agenda, the biggest obstacle to President Trump's agenda, there are basically two obstacles. One is the economy goes south, right? That's an obstacle to any president's agenda. That's why it's really important what he's doing

in the Middle East. It's why it's important what he's been doing backing off of the tariff war in a lot of ways. It's why deregulation, passing the tax cut is important. All of that's important. And then the second thing that can really hurt any administration is corruption. And even allegations of corruption can be incredibly damaging. And so, for example, there's a crypto bill that was on the floor of the Senate or is about to enter onto the floor of the Senate just last week, and it ended up being killed by Democrats plus a couple of Republicans. And Democrats, at least publicly, maintained the reason they killed the crypto bill was

specifically because of allegations surrounding the Trump family and Trump coin, Trump meme coin, World Liberty Financial, and all this sort of stuff. And so the question, listen, as a Trump supporter who raised money for President Trump and campaigned with President Trump and campaigned for President Trump, as a person, what I want is his agenda to be successful.

If an obstacle to that agenda is the optics of a thing like taking a $400 million jet from Qatar, which does amount to the single biggest monetary gift ever given to the United States, even if you consider it to just be a gift to the United States generally, not to the Trump library personally or anything like that. Is that is that the kind of thing that harms him in the public mind? And if that ties into a broader narrative that his political opponents are trying to drive that he is corrupt or the people around him are corrupt, is that a win for him?

Right? Just on a practical, efficacious level? Is that a win for him? Just on a practical, efficacious level. Is that a win for him? Is that a win for his agenda? Because the media coverage this week, it could have all been about him doing deals in these various places and bringing money back home to the United States. It's an unnecessary distraction. That's kind of my view of it at the very least. And the appearance of impropriety

amongst half the country who doesn't like him and he's now tipping into, you know, almost as unpopular as his first term, they're just going to weaponize that in the midterms and it's going to scuttle the important agenda doge, you know, and this is one of the things that I'm actually afraid of. You know, this is the thing that also ties into the economic problem, right? Right now, everybody is basically like, who cares about this kind of thing? I think a lot of people who cares about this kind of stuff? As long as the number goes up into the right, then all this sort of stuff doesn't matter very much. If the

number starts going down, then you start having all these kind of corruption allegations rise to the surface in a new way. Right? Because that's what happens with presidents very often is what you see is they're kind of a bunch of little dents that are in the vehicle. And then there's a car crash and suddenly, you know, all the dents are very evident to the naked eye. And that's what I'd like for him to avoid. What if he loses the midterms and then we start impeachment three, four and five and investigation three, four, five. Now we're back to lawfare and insanity, which nobody wants to be in. Let's talk about another win. It was a pretty great week objectively for Trump on Sunday. Treasury Secretary Besant

announced a trade deal with China in Geneva. The details were basically here we go. Another pause tariffs will go down from 145% to 30%. Maybe that's manageable. China is cutting their tariffs for the US from 125 to 10%. And they're going to end this de minimis rule, also known as the like garbage fashion rule, Tmoo sheen, all that kind of stuff. When they drop shift you stuff that's under I think the numbers 800 or so the market love the new don't don't make America dress well

again. Don't do it. I think this is like an important part of this is like this, you know, ridiculous garbage fashion. I hate it. The market was up massively, but you know, the Dow and the NASDAQ are basically flat to slightly negative. Our partners over at Polymarket, you don't have a nice market on the chances of a U S recession. That peaked at 66% during the liberation day Day chaos fallout and hey, here we go. Now it's 38%. So we're kind of maybe cleaning up the chaos. He shook the globe, the economic globe, Friedberg. And now maybe as I think a lot of people are predicted, he found an exit ramp.

Maybe that was the plan all along. Maybe it's 40 chest, maybe he's reacting to the market. Maybe all that doesn't matter. But here we are. Dave Freeberg, when we look back on this whole trade Trump tariff turmoil, what are we going to look back on this a year from now and think? Was it just a distraction? Or is it actually going to create a trillion dollars in tariff revenue? And we're going to get rid of 150 people paying taxes who make under $150,000? What's going to happen with this? And we look back on it a year or two from now? Well, I don't know where the tariff deals are going to end up. So we don't know yet. Right. Asking for a guest, right? Yeah. Yeah. And so I don't know. I don't know. Like I said,

I think one of the biggest things that needs to happen that is being discussed in these trade deals is regulatory parity, such that US companies can participate evenly in foreign markets. I kind of highlighted a few examples of why it's challenging for US companies to set up and do business in the local jurisdictions

for a lot of our trade partners across multiple industries. I think that's being heavily negotiated. So that doesn't make the headlines. That's not kind of the top of the news. Everyone talks about the tariff number, the tariff number, the tariff number. But at the end of the day, the access to foreign markets for US companies, you can even think about, I mean, a good example for us is a lot of the fines that happen to US tech companies in the EU. And there are just billions and billions of dollars of fines being paid out of our companies. That's another form of taxation. The fact that China won't allow US tech companies to operate, but we allow Chinese tech companies

to operate here. So the regulatory parity is kind of the biggest thing that I think needs to kind of be identified in these deals before we have a real sense, Jacob, because this again could be a real economic growth driver for American businesses and that could have a real effect on our GDP. So that's the biggest thing I'm looking for versus just the tariff number is parity and access to global markets for US companies. Or I don't think we know. And those are the details of the deals that are going to take several months. Normally these are multi-year trade negotiations with big trade teams that go back and forth

over several years to figure these deals out. So to create maximal leverage and accelerate outcomes, it seems like a lot of this trade hype got everyone to the negotiating table. Now the hard work's being done to figure out the details of these deals. And hopefully we end up in a better place for American businesses because of it.

Tramath, I know where you stand on this. He creates that big pothole crater. Everybody gets excited. It creates a lot of attention. And then maybe the real negotiation starts. So a year from now, when we look back on this, what would success look like for the Trump administration in Tramath Pagahapitiya's mind and assessment? I think this goes back to what I said at the beginning. I think tariffs have the potential

to be the on-ramp to our version of Belt and Road. And I think that that is an incredible jiu-jitsu move of what was an exceptionally well executed and methodical program by the Chinese government to cement hard and soft power all around the world while the United States wasn't looking and obsessed with cheap garbage that they could buy a target. Okay? So this should be a wake up call to us. We don't need all this cheap nonsense. We can live with fewer things. Those things could be of higher quality, they may be of higher price. But more importantly, we need to make sure

that we're cementing bilateral deals with as many countries in the world and building the next phase of Pax America, of American hegemony. We need to do it. So the fact that we are negotiating with China, I think is very good. I think that they are a necessary partner of ours, but we can't take our eye off the ball. The tariffs was a way of ripping the bandaid of all this globalist free trade nonsense. And now we need to reset this in a methodical, calm way. Now some markets we're not going to get right. And in some industries, we have some very complicated thinking to do. As an example, which we'll get to later, the pharma EO

is very complicated and very nuanced. Okay. But this is the hard and necessary work. So my perspective is this is the beginning of Belt and Road 2.0. I think we started with a real bang in the Middle East, and I just encourage the administration to go and finish the job and get as many bilateral deals done as possible and reset how important the United States is as a partner. We always knew it, but we allowed that hard influence and hard power to get frittered away with all kinds of nonsensical idealistic thinking that was just wasteful. And now we just need to- Well, and it was also globalists who wanted to make money, right? It's like easier to make cheap stuff over there and then sell it here. And it's harder to make money. I think that was once I think that was short term, and non strategic thinking by many

of those companies. I think that we've created dynamics that we can change, we can change the incentives for how consumers consume in the United States. And I think it's worth thinking about how to do that. All right, well, here is the polymarket on tariffs generating greater than 250 billion in 2025 that we set or polymarket set? Basically, no chance that that's going to happen. So we will see, I think, everybody coming to the table

and reciprocity bet. I don't even know how you're going to settle this, Jason, because what does it mean will tariffs generate? I think it's a really interesting bet. But the real question is on the measurement. There is not going to be some number that OMB or somebody else puts out that says it generated X. Well, I think Lutnick was saying he was tracking that, but we'll see. I mean, because if it's reciprocity, and we see us making more money or getting charged less fines to the examples we had earlier, then you could include those in it. But yeah, it's a hard bet to settle,

but I think people believe it's not gonna generate a massive amount of revenue. The relationship with China and this sort of changing concept of consumerism, you think that's a possibility for America? Do Americans just want cheap stuff on Amazon and unlimited number of Amazon boxes in their recycle bin. I mean, I'm not sure that's how consumers

have ever thought about this sort of stuff. I remember when I was younger, there was a lot of talk about made in America cars. And you know, buy made in American. And that just kind of failed because it turns out that the American cars just weren't as good as the stuff that you could get elsewhere. And it turns out that Americans are both producers

and consumers. And yeah, it's easy to say, don't buy cheap crap from China, but it turns out a lot of both producers and consumers. And yeah, it's easy to say don't buy cheap crap from China. But it turns out a lot of stuff that actually is not all that cheap also was manufactured in China. Hopefully now it'll be manufactured in Vietnam or manufactured in India or in other third party countries. The idea that we're going to be reshoring all that stuff to the United States. We're not going to making t-shirts in the United States. That's not a thing. But I do think that right now, my read is that it's too early to tell. Meaning that this just reminds me of the old

Yiddish joke where the couple isn't getting along so they go to the rabbi and they say, what do we do, rabbi? He says, I want you to bring a chicken into your house. They bring the chicken in their house and still isn't working. They go back to the rabbi. He says, I want you to bring a cow in your house. They bring a cow into their house and they say, it still isn't working, rabbi. It's just terrible. They go back to the rabbi. He says, I want you to bring two goats into your house. They do that. They come back.

The husband says, this is awful. I can't handle this. He says, take everything out of your house. So they take all the things out of their house and they're like, oh my God, this is just fantastic because that's basically what Trump did here. He put the chicken and cow and the two goats in the house. I still think he left the chicken. Right.

And so it's kind of it's going to be a question as to how much impact the chicken has, meaning the 10% tariff rate that we still have on the rest of the world is more than quintuple what it was at the very beginning of this process. The average tariff rate, not to use a number that David doesn't like, but the average tariff rate right now is higher than it's been any time since the 1930s. Is that going to have some carryover effect? I mean, Walmart is already suggesting they're going to have to start increasing their prices. So I don't think that we're out of the woods.

And I do think that the biggest threat with regard to this sort of stuff is less the tariffs than the feeling of uncertainty for investors as to what comes next. And that's where the pharmaceutical EO starts to come in or the negotiations over the tax bill. What actually makes it in? What doesn't make it in? When it comes to the stuff that makes investors sanguine. And one of the reasons why investors are sanguine about Saudi Arabia is because Saudi Arabia is a kingdom and that

kingdom is very wealthy. And that very wealthy kingdom doesn't have to worry about the next election. They don't have to worry about the next policy that they just have to throw out there for public consumption. President Trump, because of the rapid shifts in policy, the feeling, if the feeling comes away is we're now back on a solid path, this was all a tactic and we're hunky dory, great. You're gonna see the markets go up, you're gonna see more investment and all the rest. If the feeling, basically more Scott Besson

and fire Peter Navarro into the ocean via catapult would be my advice to the Trump administration. And if you do that. That seems like a reasonable, actionable suggestion, Ben. A very reasonable action. But predictability, you know, we're sitting here a couple of weeks ago, and I was as I was mentioning, I would, I know a lot of e commerce folks, and they were saying layoffs coming, we don't have predictability. And the really hard part is how do

you invest in a business, you know, you're running daily wire, it's a nine figure business, you want to hire people, you know, you need to have advertisers, many of the advertisers you probably have are somehow related to consumption in America. What's the first thing they're going to pause? They're going to pause advertising, right? Why am I advertising this, you know, mattress and why am I, you know, advertising eight sleep the best mattress in the world, I happen to be an investor, I'm a little biased, but why am I going to market eight sleep if I can't get it to the country or if the price is too high, you know, it's like, it could it causes all these downstream issues. I guess during all of this now, talking about like, shaking the globe and the in the economy here, Republicans are working hard on the big, beautiful bill. It's it's big and it's beautiful, Ben, I don't know if you want to get into your Trump dueling Trump's but it's a big, beautiful, big, so beautiful. Many people are saying, and many haters, Nancy Pelosi, nasty woman. Uh, she bet on Walmart bad bet.

GOP's plan is to push this bill via reconciliation so they can avoid the Senate filibuster with 51 votes instead of 60, the Trump bill would extend the 2017 tax cuts and jobs act through 2034. That's kind of the big piece here is these tax cuts. And there's a bunch of campaign stuff like no taxes on tips or overtime things that Trump promised to, you know, in some cases, swing states like Nevada, those are trying to get in there and an increase on universities endowment tax and the tax foundation. This is a nonprofit that analyzes tax policy estimates the tax

cuts would reduce revenues by 4.1 trillion over 10 years, 400 billion a year. And the bill also aims to cut 1.5 trillion in spend over the next decade. Some Republicans think this is weak and are pushing for 2 trillion in cuts or more. Notable cuts include a stricter snap rules tighter Medicaid caps and removing taxpayer benefits from illegals. Gosh, freeburg you actually, I understand from our group chat did a deep dive here. And you, I think are responsible in many ways for bringing the issue of our national debt to the forefront, especially particularly with this administration in Doge, which we give you a lot of credit for you being a single issue voter for this. Are you worried about the budget now? We're 100 plus days into Trump. Do you think he's got any chance of cutting the deficit?

I'll talk about the house tax bill, which I think is to use your term, J. Cal absolute disgrace. I feel is this. use your term J. Cal absolute disgraciat. Bill is disgraciat? Oh shit. Isabel is a disgraciat. Oh wow. It is absolute disgraciat. If you're an American, you should feel shame

that your elected officials are proposing that this is the bill that gets passed, that we vaporize this much money, that we put ourselves this much further in debt, that we do not treat the situation as the fiscal emergency that it is. The bill ultimately yields no real change in the annual deficit. The annual deficit could climb to $2.5 trillion being added to the federal debt load every single year going forward. In fact, if you look at the treasury yields, the 30 years now

kissing 5%. So the United States has called $37 trillion of debt at 5%. We're paying close to $2 trillion a year just in interest on our debt. As this debt gets refinanced, free, but do us a favor for the audience. If you could explain why it's going up, why it's so high and what that means in terms of- Why it's so high? The debt or the interest rates? The interest rates. Yeah. Well, the interest rates are going up because the probability that the US will default on its

debt payments, which is what you're buying when you buy US treasuries, you're getting the US government to pay you some number of dollars with interest over time. And the market is now demanding that that interest rate be as high as 5% because of this fiscal situation that the United States finds itself in. We are now burning an additional $2.5 trillion a year adding to our debt load. We are in a fiscal crisis and we're not willing to admit it. And I've said this from day one, that DOJ can only do so much. And clearly, that's the case where they're now talking about sub $300 billion a year in potential annual savings from DOJ action. At the end of the day, Congress needs to take action.

And this bill from Congress doesn't take much action. I will tell you that if you look across the board, all of these programs are still being proposed to be run at a cost that is well in excess of their pre-COVID levels. And so I would set two guiding principles if I was to be the benevolent dictator of the United States of America. My guiding principle number one would be that any program that we intend to continue to persist have its budget level cut to pre-COVID, to 2019 levels. Second would be, and if we did that, by the way, we would be in a much better fiscal situation.

The second would be that we add no new programs in the moment. There's a whole bunch of new shit thrown into this bill, as well as increasing the cost and a few cuts here and there. I'll just highlight a couple that I think are worth noting. You know, there's a cut in the SNAP program, which is the Supplemental Nutrition Assistance Program. That's food stamps.

And I talked about this with Brooke Rawlins in the interview I did a few weeks ago. You can watch it on YouTube. And we talked a little bit about how this snap program has absolutely exploded in size from 60 billion a year in 2019 to 120 billion a year today. So in this budget proposal, they're actually cutting it back by about 30 billion, so to 90 billion, so it's still 50% higher than it was pre-COVID.

And there's a lot of kind of stories we could go through on what happened during COVID that caused this thing to blow up the way it did, but political wrangling pulled money out of the government, into people's pockets, and that is persisting today. I'm a big believer in cutting taxes. Obviously I'm probably more libertarian than anyone else on the show or that we've ever had on the show. But at the end of the day,

you can't just say, Hey, let's cut taxes and spend more than we're making. It doesn't make sense. A lot of this stuff is going to be exploitable. The tips and overtime exclusions are a way to pander to people to get votes and now keeping your promises on those votes. I think at the end of the day, the tips and overtime rule could invite a lot of gamesmanship and loopholes that will be created and people will wake up and be like, oh, for example, if I'm an independent contractor, I will enter into a contract with someone that says, here's the service I'm providing you for 50 bucks. And then there's an optional tip you can give me at the end.

And then I will pay taxes on that tip. And I can give you a hundred other examples that this will create an inordinate number of crazy insane Loopholes the interest on the debt at one point nine trillion dollars a year Equates to seven percent of GDP that means seven cents of every dollar that moves in every transaction in this country is Being used to pay down interest on money. We overspent in the past. It has become an absolute crisis I think that there's a few folks that should be shout out on this which is senator Paul down interest on money we overspent in the past. It has become an absolute crisis. I think that there's a few folks that should be shout out

on this, which is Senator Paul and Senator Ron Johnson, who both highlighted how ridiculously under-impressive the spending cuts are in this bill. I think we've got a lot of work to do. I'm deeply disappointed. I'm scared. And I hope that this all gets kind of fixed up in reconciliation.

Do you think that we should line item out all the new spending, irrespective of what it is? All new spending line itemed out, that's rule one. And rule two is all existing programs gotta go back to pre-COVID levels. You do those two things, we're in a great place. Yeah, and just to put some numbers and some charts behind it, here is the debt

back to Clinton era. Clinton obviously balanced the budget so you get this nice flatness there. Clinton added 392 billion in the years. It's barely noticeable on the chart 40, 50 billion a year. Bush 5.4 trillion four years, about 1.3 trillion a year, Obama a trillion a year. And then we get to Trump 1.0, two trillion a year, suddenly decided we would double it., same thing. They added almost exactly the same amount to a trillion a year. And yeah, the right way to think about this, J Cal, to do the same. Yeah. It's not total dollar amount. It's percent of GDP that you're adding. And, you know, right now, at two and a half trillion dollars a year of deficit, we're talking about a deficit to GDP

of like 8%. Yes. 8% a year. This is like Argentina. This is like insane. The fact that we don't treat this like a fiscal emergency and everyone goes up and they tout, oh, we're gonna make 60 billion in cuts in Medicaid.

That's out of $820 billion of annual spend. You know, oh, we're making 30 billion in cuts in SNAP. That's still 50% higher spend in total than we were in 2019 a few years ago when we didn't have that much of a problem. This has become like such a reset of expectations. And I worry again, that we went into this, I think in a very optimistic way,

thinking that this administration was gonna treat things differently. We had Doge, we had alignment on the importance of the budget, Besen has highlighted it. And then it's kind of back to gamesmanship in DC. All these representatives from Congress show up and try and get money for their constituents in a way that is not sustainable.

We're not gonna be able to keep this up and we're not really having the hard and tough conversations we need to be having. And every year, everyone wants to get elected by keeping programs and keeping money flowing that their constituents elected them to do. And they wanna add new programs so they can go on CNBC and say, look at this cool new program I stood up.

It's great. This is gonna create the future of America. And meanwhile, there's no future of America because we're burning two and a half trillion dollars a year. So would you call this the, B wants the three three three plan you'd call this the three three eight plan I don't know if there's a three But yeah, it's definitely the eight. This is eight almost nine Yeah, I mean I think all of this is right. I mean the reality is the US debt to GDP ratio is extraordinary already

The reality is the US debt to GDP ratio is extraordinary already. It's it's only going up from here. And we have to acknowledge here that the Republican majorities in the House and the Senate are incredibly narrow. That for every Ron Johnson, who's saying the right things, you have a Josh Hawley, who's saying the wrong things in Missouri and writing full scale op eds in the New York Times talking about how not a buck should be cut from Medicaid under any circumstances. And this, you know, does run headlong up against a reality, which is that the one of Trump's signal changes from the old Republican Party was not just a change away in terms of foreign policy toward a more realism and less and less interventionism, but it really was a change away from the Paul Ryan Tea Party Republican Party as well. And whatever you think about Paul Ryan on a lot of other issues, Paul Ryan was on your side of this, David, when it came to actually trying to fix the fiscal problems with the United States.

And I'm old enough to remember the Tea Party when we were out protesting literally in the streets about government overspending as a response to Obamacare. And that's gone completely by the wayside. And so when you're looking at Republicans today arguing over whether to zero out waste, fraud, and abuse, the problem is not in the end waste, fraud, and abuse. The problem is the programs themselves as they are currently structured. And unless you're willing to make serious systemic changes to things like Medicare, Medicaid and Social Security, you're not going to solve any of these problems. And here's the sad reality is nobody is willing to do that. So just as we were saying earlier, maybe Americans are addicted to cheap goods

from abroad. Americans are certainly 100 percent addicted to government sustenance. They are they're absolutely addicted to this. All net taxes in this country are paid by the top quintile all of them, because below the top quintile, you're getting as much back from the government or more than you are paying into the system. And we are also gaming out to the future paying away our kids fiscal future because of all of this. So you know, when people ask me what's going to happen, I mean, the answer is

we're going to either wildly inflate our currency, or we're going to go into massive austerity measures, you know, five to 10 years from now. There's not going to be a third choice. I mean, and so maybe politicians keep kicking it down the road. Maybe that's what this is. But even the kind of cuts that are being talked about by some of the people in Congress who I like are not going to be enough to actually put us back on the right fiscal road, even if the Republicans do what they're talking about with regard to work requirements, for example, on Medicaid, they're saying there should be an 80 hour a month work requirement. A month. If you're an able a month. Two days work a week.

Well, that's crazy. That's crazy, right? That five hours, four hours a weekday for a month to get your Medicaid requirement if you're an able bodied person in the United States of working age. You know, that sort of stuff is not sustainable But nobody's actually gonna take that on and so the question for President Trump is gonna be is he willing to actually go to the barricades? And not just make the case that the tax cuts have to be maintained because they absolutely do but also That Republicans need to get on board

With some of these cuts because you're gonna have a lot of pushback from the purplish Republicans from from the Josh Halley's in Missouri and from The Michael lawyers in New York, that New York and all of the people who are afraid they're going to lose their seats if there are any cuts. That's right. And existential cuts. I mean, it is like an existential crisis that no one's willing to stand up and highlight just how critical this emergency is. Two and a half trillion dollars of deficit spending on a $28 trillion GDP.

Tell me when in history that's actually worked out at the end of the day, except when you're in some war and you're gonna end up taking over some country and getting all their resources. This is never- And as you mentioned, this actually, this has knock-on effects with regards to things like de-dollarization.

Why are you investing in the American dollar if you believe that the dollar is going to- That's right. That's why the treasury yields. This is the debt-debt spiral that we find ourselves in because what happens is people stop owning treasuries when they start to question whether or not, 30 years from now, the US government

is gonna meet its debt obligations. Even the smallest marginal question of that drives interest rates up 1%, 2%. Suddenly, your 30-year treasury yields at 6%, 7%. And then your interest rates climb, and then your deficit spending climbs, and that's how it becomes a spiral So now the debt goes up even more than it did the year before and then the next year it goes up even more

Per year than it did the year before that's why it's called a debt death spiral And I will say that let me sorry Let me say one thing one of the things I've heard in a lot of members of cabinet that I've met with Over the last couple of months is we've got all these new sources of revenue. I had an interview with Doug Bergen He talked about unlocking America's assets. We've got this balance sheet with lots of assets. We're going to do land leases and all sorts of other things. We met with Lutnick. He's going to sell the Trump gold card, the immigration card. We met with Besson. He's got these ideas on how we're going to drive. Everyone's got great

theory on how we're going to grow GDP and actually grow government revenue. But until those dollars start to flow in, we have to get our fiscal house in order. We have to cut spending. When those dollars start to flow in, then you can start to spend, but you can't spend ahead because otherwise the cost of the debt and the economics uncertainty is going to limit our ability to execute on the back end on that revenue generation. And I'm very worried about no one kind of paying enough attention to this. So I just, you know, I feel very passionate

having seen this bill that we're just not on the right track. It's really, it's really frustrating. Let me pull up a tax chart here, Nick, from the chat and get Chamathier comments on this bar chart here, just who's paying taxes, as you can see, you know, the top 1%, which I think is this panel here, and the top 5% paying the majority of the taxes in the country. Is there any way to increase revenue? And is there any way for politicians to say, hey, let's cut military

that hasn't come up yet as a concept, but maybe cut a little bit of military spending, and maybe put in some modest austerity measures now. Before as Ben's pointing out, we get to, you know, Spain and you know, Greece, I don't know, what was that 10 years ago when they had to Portugal and they had to do like intense things, your home country, Chamath of Italy, like, with austerity measures, Americans, I don't think we've had to ever face austerity measures, certainly not in our lifetime. So income

taxes, can we get more revenue in? Or is that unrealistic? And then cutting military maybe on the margins Chamath? Or do you not see this as a major issue? It's easy to catastrophize. Okay, I think I think that is easy. Because I think there's enough data there. The harder thing, if you're going to make a directional bet, is to try to find the nuance. So what is the nuance? The nuance is you can point to all of these countries, but what is singularly different between all of those countries and the United States of America?

Is that a question? It's entrepreneurship? No, it's rhetorical. Okay. The difference is we are the shining city on a hill, and every other country is not. And as much as we want to believe that there is equality, there isn't. There's a hierarchy, and America is the most important country

in the world. Period, full stop, end of story. What does that give us the ability to do? It gives us very different parameters with which to solve this problem. It gives us, I think, the parameter of time. And it gives us the parameter of acceptance from a lot of other foreign governments.

Why? Because they need America to also succeed. There's this very funny quote, which is, when you owe the bank a million dollars, it's your problem. But when you owe the bank a billion dollars, it's their problem. This is true here.

And I think that we have to recognize that the right thing to do is obviously what Ben and Dave are saying. I don't disagree with that. But if you panic, I think you're going to start a cascade that is unnecessary. And by moving to a place where you're all of a sudden trying to cut entitlements incredibly aggressively,

I don't think sets the stage for a thriving American population that then allows this problem to actually be solved. So what is my proposal? I do think we have to monetize the balance sheet of America. I do think we own probably 100 trillion to 150 trillion of assets, all of us as citizens. We own that. And I do think that- Explain what those assets are to the people listening, because they may not know. So the largest landowner in the United States is the United States of America.

The ability to allow you to drill is given by the United States of America, the ability to do many things. By the way, Chamath, I'll just give you the numbers from my interview with Bergam. The federal government owns 500 million acres of land. And they have control over 3.2 billion acres in the outer continental shelf, which is the land under the ocean around North America. The resource availability in that land, under the water and in the kind of mainland

is in the kind of immeasurable trillions of dollars of value. And their business model, Burgum stated business model in the interview I did with him is land leases and royalties. So enter into private partnerships and then participate in the value creation. I've talked to Doug about this. So I agree with him.

We're talking about a balance sheet. Again, I said 100 trillion. You could probably make the case that it's two or three or 400 trillion, but let's just use 100 trillion. My point is that our balance sheet is much larger than our debt obligations, number one. Number two, we owe $33 trillion, it's as much their

problem as our problem. And number three, every country that owns debt does so in part because they need America to be successful so that they themselves can be successful. So I think if you look at all of these interdependencies, the right thing to do is we need to monetize the balance sheet of America much more aggressively than we've looked at before. And two, what Dave and Ben said we must do, which is we need to draw a firm line and say no new spending. I completely agree with that idea. But I think if you do both

of those two things at once, you have meaningful inflows that can fund a lot of the tax cuts that people want to propose. It'll also allow us to show that we have some level of discipline by not overspending and all of these other random pork barrel projects. And I think it allows us to set a path towards this 333 plan, just to be clear to everybody what Scott Besson's 333 plan is. Which is also D'Aulio's plan. It's 3% inflation, it's 3% GDP growth, and it's a 3% deficit to GDP percentage. And if we do that, that's the renaissance in the United States Okay, we can quibble about the politics, but it would be a economic and mathematical Renaissance. So that's what I would do.

If this is the best plan that Jason Smith and Mike Crapo can get done between the House and the Senate, if this is the best plan, I urge the United States government to figure out how to start aggressively and quickly monetizing our balance sheet. I'll just respond to two things. Oh, no, take off. Hold on.

Before you do that, let me just ask one question. The land we're talking about here, Friedberg, and the oil, I guess, or the minerals that are under the ocean floor. Everything. Everything. Well, what else is there under the ocean floor is the question. Yeah, so who's gonna buy them? Yeah, okay. Who is the customer? I think is what we're all wondering of this land in the United States and

for what purpose the private companies that that would then use those resources to manufacture critical requirements for the United States and other countries who want to buy it. And export. And so for example, the US is now the largest exporter of methane. We have four pipelines that go to this facility that I visited with Doug in the interview I did in Louisiana. They liquefy that natural gas, which is methane.

They put it on ships. Those ships go to India. They go to Taiwan. they go to Japan. So U.S. companies are selling liquid methane that we're pulling out of the ground to those countries that they then use to heat their homes and power electricity production. We don't necessarily need to go back today and say,

hey, let's cut entitlement programs deeply. We certainly should make entitlement programs more efficient. We don't need to. All we have to do is take all the other programs and reset them to COVID or pre-COVID levels. And secondly, is get rid of all the new programs. What's wrong? Okay, so we all agree on the new programs.

No, my wife, she texts me, she's sitting there and she does things to tilt me. And she says this in the series moment, my wife and I fought last night. You got in a fight last night? We got and I fought last night. We fought last night. We got in a fight last night. We got in a fight last night. And I just sent her a very quick text that said,

I'm really sorry about last night. And she says, I've moved on. Just the way it comes up. From the fight or you? I'm laughing. No, she moved on from the fight. That's the question. Did you send her that text

while I was talking about defecit spending? Ben, what was your last fight with your wife over? Let's get it all out in the jail. By the way, Ben, when Chamog and his wife get into a fight, it's like sitting, I was on a plane with them, I was on a plane with them flying back from D.C. Oh my God, this fight, oh my God, so uncomfortable.

Four hour fight. I assure you, you're talking to the waitress, and the way you look at the waitress, is not the way you're supposed to look at a waitress. It's way more serious than that. Way more serious than that. And it's like serious than that. Way more serious than that. And it's like when you're in a coffee house or a coffee shop in Europe

and there's this like European couple speaking some language you don't understand. Rarararara. Rarararara. Rarararara. Rarararara. Rarararara. So at some point we have to interrupt the team.

Then the more you hang out with us, there will be a moment where you will observe me and Nat fighting. It will be a multi-hour affair. It is not initiated by me. It is not how long I want to keep it going. It does end with a passionate love making from a 12.30 to a 12.36 a.m. It's a full of six minutes of exebalosian, but chaotic love making. Honestly, right now six minutes feels like a long time. And then we all go downstairs and we eat the leftover managot.

It's an incredible tradition in Italy. We fight for three hours, we make love for four minutes, and then we eat the old pasta. Get this thing back on track for a second. Let me get this back on the rails here. I want to ask you an important question, Dave, if I may. Are you, as a man of science, who believes in global warming and who cares about the environment? Is it a great idea is what a lot of people are thinking here. Is it a great idea for us to rip everything out of the ocean shelf in Alaska and sell all this incredible

land we have that's preserved with nature and trees to foreign governments and people who own our debt? Is this a great idea? Do you have concerns about this versus austerity and maybe not buying as many bombs? Here's the economic argument. Energy demand, heating demand, power demand is growing globally with or without the United States. Okay. Does the United States,

which produces that energy cleaner than anyone else, want to participate and benefit from that energy demand? Or do we want to leave it to other countries that are going to do it in a dirtier way? And what do I mean by that? So natural gas is methane. I'll just give you the natural gas story real quick. We pull it out of the ground, we figured out a technique for putting pressure into the ground, that pressure forces the methane to come up through the rocks. And then we capture that methane, and then we liquefy it. So reduce it down by like 800 times size so now it's liquid it's negative 160 degrees celsius and we can transport it methane when it burns to create

electricity is 60 percent less carbon into the atmosphere than burning oil or coal so the first argument is methane is a cleaner way of producing electricity than oil or coal, which would be alternatives. However, when methane leaks, it's 80 times more heat capture than CO2. So you've got to make sure that your methane production, your methane extraction systems are tight, aren't leaking methane, and that makes it a cleaner from net- And we have that regulation in America and other countries don't. And other countries don't do as good a job,

et cetera, et cetera. And then that power is gonna be generated and someone's gonna make that energy somewhere. So if it is a cleaner power source and we can make it cleaner and we can do it better, then it's certainly the case that the United States should be as we are today, an LNG or liquefied natural gas or liquid methane exporter.

So that's like all story line. Can I build on this? Also it's like, can Americans grow up? I mean, these are industries that have to exist. Have the courage to have some hierarchy and some priorities, please. Like we are talking about a potential debt spiral on the one hand, we're talking about cutting entitlements on the other. And people want to run around and basically say, don't do anything. Well, don't do anything is not an option. So yeah, monetize the assets.

Okay, you may not like the way that Trump says it when he says drill baby drill, but the actual outcome is the same. We need to monetize, we need to generate revenue in the United States as quickly as possible. We need to do the things that maintain technical supremacy. We need to do the things that maintain political supremacy. If we don't, we will be a second and third tier country. Why does anybody in America want that? If you're an American citizen that wants that, go to another country. Ben, as we're saying here, do you think maybe we do solar or maybe clean gas here, drill,

baby drill, or probably some people in the oil industry? American citizen that wants that go to another country. Ben, as we're saying here, do you think maybe we do solar or maybe clean gas here, drill baby drill, or probably some people in the audience are thinking, well, why don't you rich guys pay 1% more taxes and cut the military 5% and then a little bit of austerity measures on the margin sound like a better strategy? How would you respond to that argument?

That many people in the audience are probably thinking right now. So I mean, if the numbers added up, that might be plausible, but the numbers just don't add up. I mean, the idea that if you just incrementally increase the top tax bracket, that that's going to pay off the massive national debt that we have racked up or the national deficit that we're racking up every year. The numbers don't add up in any way like that.

And when you take a look at energy production, the same thing is true. Solar is not going to be making up for LNG anytime soon. That's for sure true globally. And you know, when it comes to America's role in the world, which is the biggest thing here, when we talk about cutting the military budget, that always sounds sexy. But the reality is that undergirding things like, for example, the big deals that President Trump is cutting in Saudi and UAE is the giant American airbase that we have in Qatar and the ability of the United States

to provide the defense mechanisms for those countries. I mean, let's be very clear about what's going on in the Middle East. If the United States did not exist, there is a solid shot that the Saudi monarchy, the Qatar Emirates and the UAE would not exist in their current form. And you would have something like a Muslim brotherhood running many of those nations. And so the reality is that always backing American soft power is the threat of American hard power. And this is for sure true when you look at things like what's going on in Taiwan.

I mean, one of the ways that we you guys know much more about this than I do. One of the one of the ways we've been talking about getting out of the possible debt spiral is massive increases in productivity due to A.I. Well, if China outcompetes us in A.I. or if China were to take Taiwan like right now, that would basically crush the hope of that. And the reason that China is not doing that right now is because number one, we actually are building up the American Naval assets. President Trump is working on that.

But number two, because we are rapidly scaling with regard to our own energy production. I mean, you have to be an energy intensive nation in order to produce AI. And so the United States has to play this game. If we're not playing this game, we're losing. I mean, China is out producing outside of energy by leaps and bounds right now.

Leaps and bounds. My simple request for Americans is don't be mathematically illiterate and let's all grow up together. Come on. Yeah, yeah. And I'll just say like, just to go back a couple comments to Chamath's point, number one, monetize our assets.

Totally agree, there's opportunities. We got to do it in a clean way. We follow the law, we follow the EPAs there to make sure that these methods and systems that we use are not endangering species or the planet or whatever other kind of acts are important. But I'm not sure that the ramp up is going to make up for the deficit.

I think that's really important. It's great to say that at a high level. There's a North Star there, We can monetize our assets. But as you build out the annual plan over the next 10 to 15 years, first of all, political cycles are going to affect this. If the Democrats come back into power in this next election cycle, they'll put a blockade on this stuff. It's not going to be persistent. So again, we have to fix the spending problem and this idea that we have to cut

entitlements to fix the spending problem. I don't even think that that's step one. I think step one is don't add new programs. Step two, go back to COVID level spending. And then step three is you can address the entitlements and all the other kinds of spending. And step four is you execute as quickly as you can on monetizing America's assets.

But I'm not sure that the ramp up is gonna be fast enough to make up for the deficit of the next four years. One quick comment here also that I think is important and that is that the American people, we're going to have to get used to the idea that we can't just spend every dollar that comes in. So if you take a look at the Spanish Empire in the 16th century, Spanish Empire in the 16th century is a dominant power in Europe. And then they discover all the gold in the new world. And so suddenly, they are easily the richest power on Earth because of the amount of money that's coming in.

And they immediately start spending all of it and they immediately start expending all of that capital in order to build up and build up and do different projects. And pretty soon they're bankrupt and they're defaulting on their debt routinely. And there is there is not a correlation between your asset base and inability to go bankrupt. I mean, we all know very rich people who go bankrupt because they outspend their asset base and inability to go bankrupt. I mean, we all know very rich people who go bankrupt because they outspend their asset base. In the United States, we can expand our asset base for sure and we should do that, of course. But if we don't wean ourselves from the addiction

to spending particularly on social programs because that's what's gonna bankrupt us, then all we will do if we increase our asset base is say, hey, look how much more money we now get to spend because it's there. Just so you know, Chamath did hit the brakes before he hit that situation. He hit the, he bumped the brakes. I touched a couple billion, but I learned a couple lessons.

He almost flipped the car. I, not really, but I think I just want to pick up on what Ben and Dave said. This is a great opportunity for us to grow up as a society, collectively to have some priorities. The problem that we have right now is we allow all kinds of fringe belly aching and we don't have a good sense-making mechanism to prioritize that belly aching.

And so everything seems like a class five hurricane and everything is not a class five hurricane and how we respond should be proportionate. We need to react proportionally to the actual challenge at hand. And I think what maybe just said differently is, this is a class five category issue. How we spend and our revenues are completely, completely broken. So we need a new way of addressing it. And the people that would have issues with how that's solved

need to have the maturity to actually point to what the alternative is. Because there is no way to quickly raise several trillion dollars without selling land, and without giving land leases and without taking royalties for drilling. And so they should say explicitly, I would rather the country go into a debt spiral and go bankrupt. Okay, then just say that. Yeah, I mean, and to the point of taxes, even if you raise taxes 20% on the rich,

it's gonna like impact 300 billion a year. It's not impossible. It's the pimple on the dog's ass, people. We have to stop the spending train. Hey, let's talk about, do we wanna go farm or do we wanna go Science Corner? I don't want to have you miss your Science Corner there. What do you want to do?

Well, my Science Corner today is just a rant against the governors who are signing laws banning cellular meat. And I'll just hit on it real quick. Oh, this is your take two on this because you've done this one, this rant. Correct, Governor DeSantis did this in Florida since then, Alabama, Mississippi, Indiana.

What's your issue with the cellular meat, sir? Why, why, why don't you like the cellular meat? It tastes like a... And why do you 3D print a little filet mignon? It's a massive big problem. It tastes like a little pepperoni. Yeah, like a chimazza, a little pepperoni. It doesn't taste that bad.

This week, Montana's Governor Greg Gianforte signed a law, House Bill 401 banning cellular meat. That bill goes into effect on October 1st. You guys can laugh all you want. If it was in a market that you were an investor in, in innovation or technology, for example, if they said, we ban AI in our state, how would you guys react? What sort of opinion or commentary would you guys have

on the show? Move around, move around the state, let the state go to zero, and then come pick up the ashes later. We have 49 other ones. And I think that that's really important. And now, by the way, there's a house bill being proposed to do the same thing throughout the United States. Meanwhile, China and Europe are building cellular meat

systems that are rocketing ahead. They're actually economic drivers because they make the cost of food cheaper. They're creating new industries. There's a lot of supply chain that goes into these industries. Whether consumers like or want to buy the product or not should be left to the consumer. It should be a free market.

The market should decide. As long as they're regulated, check for health, check for safety as they all are today, the FDA, the USDA and others are all involved in regulating these systems. They shouldn't be banned because in every single state- What is the reason? They've said the reason we're banning them

is to protect our ranchers, our cattle ranchers. And so in all these cases, they're saying that that's economic protectionism. No, but that's right. I look, I take this very different view. I mean, these are people who ban Uber to protect the cab drivers. We just get 90. Yeah. I don't like the benevolent dictatorship model of running a country. Each of these 50 states have the ability to make decisions. Some are good, some are bad, some are neutral. If they wanna make fundamentally bad decisions for themselves, let them.

If they wanna make fundamentally good decisions for them, let them. At the end of the day, those populations in those places are making those decisions. I don't see it as a big deal. Yeah, and I think the reason is that most of the consumers 95% of them don't give a shit about the product, whereas Uber and others were different. Many people did care about the

product, but fundamentally, it unlocks economic opportunities that they don't see today. And I think that's what's really frustrating about this is a small cohort has created regulatory capture mechanisms by getting these laws passed in these states. These are this rancher industry. Can I say something as somebody who's tried this? That meat sucks ass. Okay. Yeah. If the meat was delicious, that's fine. Just be honest with you. No, this is my point. I've not even had it. I don't give a shit about the meat itself. Let me make my point.

If this product was exceptionally delicious, it would be widely consumed all over America. And this would never come to pass because there were taxi drivers in Montana, but the reality was Uber was better in Montana. And there were taxi drivers in Florida, but Uber was better in Florida. And my point is that when the product is so good, it allows adoption and it quells the naysayers at the fringes.

When the product is a little bit more met. But what if someone banned Uber before it had a chance to be good? Yeah, that's a good point. I mean, I think your point is this is a developing technology. It's early stage and they're stopping it for guys because what would happen is there were places that banned Uber and what happened?

They all flipped. That's because Uber went forward and broke the law. No, no, no. We reinterpreted regulations in favor of what's right for the people of America. What I'm saying is not in the place that it was banned, but there were enough places around it where the product value could be demonstrated and governments did embrace it. That's fine, but Jamath, that doesn't mean you pass a law banning it. You should still let the consumers have the choice.

It's regulatory capture. Who cares? If this was one of your companies, Chamath, and they were banning some pharma company or social media or some bullshit that you'd started or got invested in, you'd be all up in arms saying, they're blocking us, they're keeping us from developing, we're early stage.

I wouldn't cry. No, I don't cry about these things. I'm not an investor in anything that's gonna benefit from this. I think it's fucked up. Well, I don't think so, because it happens all the time. I would say get over it, grow up,

figure out the markets where you can make it and make the product excellent so that then all these people in these states abandon it. You and I have a very different point of view on regulatory capture, capitalism and free markets, Chamath. That's a fact. No, no, no.

Would you eat pork that's made in a fermentation tank instead of made by a- Oh, because it's Jewish, you gotta bring up pork? No, I'm actually curious about this. Honestly, God, this is the only reason I'm interested in this topic at all. This is like, not to get into abstruse Jewish law, but this is like an actual open question, is that if you grew pork in a tank and it didn't come from an actual pig,

would it then become kosher? And is it considered a vegetable as opposed to a meat? Because it's not coming from an animal. Right? It's like, like this stuff to me is really interesting. And hey, if it gets me to be able to eat bacon, I'm all for it. Like that's it. I coming from an animal. Yes, I talked to my wrap-up about it. Right, it's like, this stuff to me is really interesting and hey, if it gets me to be able to eat bacon, I'm all for it. Like that's it, I've heard amazing things. The reviews are excellent on bacon.

Yeah, okay, let's go to Farma here. Shout out to Long Hill Pecania Steaks. We'll send you some. Oh, I just made an order from Long Hill. I just bought $500 worth of stuff. I got a discount though. I don't know if you got the email, but if you put the Memorial Day promo code, you get

10% off. Oh, really? I mean, I order, I have a standing order with Long Hill Wagyu from my Pecania steak. I mix it up. I mix up the kind. No, I do the Pecania, but I do some Denver steaks sometimes. I mix it up. Nice.

See, I like the New York strip. We'll send this. Ben, you eat steak, right? Of course. Of course. Ben, try this place called Long Hill Wagyu. It kicks ass. It's right by me in Austin. It is incredible. And you know, Freiburg doesn't eat meat and he you know, it's just the nature

of it. Okay, let's wrap on farm. Okay, Trump signed an executive order to slash drug prices on Monday. I mean, this is like a great week for Trump. I like everything Trump did this week. The goal is to cut prices 30 to 80% by giving the US MFN if you don't know MFN stands for most favored nation status. That's a generic term in business. It means we get to pay the same price of whichever country gets the lowest priced for a specific drug. This executive order would cut out the famous middleman. He's talking about PBMs. You've heard more Cuban friend of the pod talk about that a whole bunch. Here's RFK juniors quote, Congress is controlled in so many ways by the pharmaceutical

industry. This was an issue that people talked about, but nobody wanted to do anything because it was radioactive. It's radioactive, obviously, because listen, so many politicians are getting donations and lobbyists. What's your take on this? Obviously, Amore is in this business and is in pharmaceuticals. So she has some great insights, I'm sure as you do. Yeah, let me start by talking about the specifics of the EO. The really interesting thing about this EO was that there was a very detailed report that was published in the National Bureau of Economic Research a few years ago that studied this exact thing. So the president used the term MFN, but the concept here is called international reference pricing. Anyways, there was an extremely detailed study that said, okay, what happens to drug prices when you use this IRF pricing mechanism? Okay. And what they showed in that study was a very interesting takeaway, which is, if you set the IRF with only one country, typically what happens is for the United States,

the change is about minus 2%. If you do it with a basket, the actual profitability of the pharma companies would go up slightly. If you had a required comparison, meaning it had to be a like for like opportunity, profits fall about 20%. And if you use the US bargaining framework, then profits could fall about 27.5%. So this is the impact of that, but there are a lot more nuances of it. So the question would be, what does this all mean then to the downstream impact of pharma? The thing to keep in mind is that we are in a very complicated situation on the R&D side of the house. And what this chart shows is clinical trial enrollments in China versus the United

States. Now, this has been happening well before the EO. But what this effectively shows is a really important comment, which I'll come back to. China, a few years ago, very smartly, completely reformed the way that it does trials and the procedures. And as a result, what they saw when they had this regulatory reform was an explosion in the number of clinical trials. And there are as many clinical trials now in China as there are in the United States, and oftentimes, they're bigger, which is to say that the amount of innovation and the surface area there is already exceeding what's happening in the West. So that's where we are. Now, why does this all matter?

If you go to the next chart to tie it all together, as you saw at the beginning, international reference pricing has an impact to profits. Profits can have an impact on R&D. As we stand today, R&D, we are neck and neck with the Chinese. What is more important to understand is that actually the last 10 years has been very complicated

for Western pharmaceutical businesses when you look at the average rate of return. As an industry, these things used to be extremely profitable businesses. But as of the last decade, it's been very, very hard. In fact, I think like the Deutz study that I saw was that can you believe this, the average ROI for broad-based pharma is 1.5% as of 2022. Per year. So if you invest a billion dollars, you're making about 10 million a year. You'll make 10 million bucks, which is not enough to fight this R&D battle. So if you invest a billion dollars, you're making about 10 million a year. You'll make 10 million bucks, which is not enough to fight this R&D battle.

So if you then further affect the profitability scale of pharma, the impact is probably that we push R&D to different places. So I bring all of this up basically to say, I think that what Trump did in one vein was brilliant. Why? He took a plank of the Democratic Party. Like if you guys think about like what Bernie Sanders ran on, it was this. And he took it and he jujitsu'd it,

and now he owns it. He'll be able to take credit for it. And the Democrats are robbed of a very critical political plank that they have, which they'll have to fill in with something else. And if you saw, by the way, Ro Khanna and other folks said, oh, we agree with this and we'd like to do this via some bill. So even they had to kind of flip and say, yeah, this is kind of a good idea. So politically, it's good. The execution of this is going to be complicated because of what I showed. We were already at this delicate balancing act of how to make sure that there could be a lot of domestic R&D that was still economically viable. The last thing I'll say is we still need to do one important thing, which is I think that this EO is an important

start, but it doesn't yet address the much bigger problem, which is that there is a lot of money that goes to many other things other than drugs. So when you look at a dollar of healthcare spend, which is, you know, almost 20% of GDP, I think the number is that, you know, there's 30% that is administrative complexity, 20% that is pricing failures, which is effectively to say, PBMs, failure of care coordination is 5%, overtreatment is 10%, fraud and abuse is almost 10%. So there's a lot of other organizations in this value chain

that kind of eat out of that dollar before it gets to the sense that goes to pharma. And so it's important to make sure we don't overlook those. The biggest ones being the PBMs. Yeah, Ben, your thoughts on this, Ian? 9% goes to pharma. Yeah. What are your thoughts on this? 9% goes to pharma. Yeah. What are your thoughts, Ben, on this broadly speaking? I mean, I have a general rule. If Bernie Sanders likes a policy, I don't like the

policy. And so when it comes to this particular EO, I mean, the real problem here for using MFN status, as President Trump is calling it, is that if we are going to use the kind of tariff tools that President Trump has talked about to even the playing field, it seems to me this is where you actually should put pressure on places like Canada or Mexico or the EU is for them to actually pay their fair share for the drugs that they are getting from the United States because we're patenting all the drugs over here and then we're selling it at discount prices to all of these nationalized health care systems. And so if you do that with Medicaid, what you'll probably get is, number one, a lot of these pharmaceuticals just won't be used by Medicaid.

Pharma won't sell it to them. Instead, you'll have to go into the private sector, which means it's going to be more expensive in the private sector than it would have been otherwise. If you're covered by private insurance, your Pharma bill is actually going to be higher than it otherwise would be. What we should be doing is getting other countries to pay their fair share, drive up the price on those other places. And then you can actually do something that looks more like an MFN status because you're not artificially you're basically squeezing the balloon here and you're inflating the balloon here. The inflation side being the private health care insurers in the United States and private consumers in the United States. And so if you're talking about, you know, just artificially lowering prices by basically clocking pharma, I mean, the reality is if you want to kill R&D, this is a great way to kill R&D. People in the United States, I don't think have a clue as to how much money gets spent

on R&D that craps out. Because what you see is the big winners. And it's like going to a casino and only watching the guy who's got the hot hand with the dice, right? I'm the version with the dice and I've got the hot hand. Right? It's me. But you don't see the other hundred guys, the casino's absolutely cleaning out.

And the reality is the vast majority of biotech companies and startup pharmaceutical companies and people who are trying to do this sort of stuff spend literally billions of dollars and then crap out at phase three in the FDA trials. Ben, just to build on this, cause you're making an excellent point. Do you guys know what the cost of the average trial was

in the early 90s? It was about $250 million. The average cost of that same trial in 2025 is $2.3 billion. 10X. And effectively what happened in that 30-year period was a thousand regulations became 150,000 regulations. And so to your point, one thing that we could do is if this EO is going to continue and really be implemented in a forceful way, the other side of it is we have to find a way of decreasing the regulatory burden so that then the cost of the trial isn't all the administrivia, but it's the core science.

Well, and isn't the issue here, Friedberg, that there is a free market for drugs outside of the United States where they seem to negotiate really well and then inside the United States, we don't seem to negotiate our prices for drugs as aggressively as Canada, Mexico and European countries do? As is the case with the cost of education and the cost of housing, the cost of drugs is largely inflated because of the federal government's role in being the primary buyer or capital provider to that market. So similar to how the US government provides all the capital through the federal home loan program, and all of the capital through the federal student loan program, the cost of tuition has no market check and

the cost of housing doesn't have a great market check, because there's an unlimited endless supply of capital coming from the federal government. Similarly, through our purchases of prescription drugs, the federal government as a buyer doesn't have any incentive to keep prices low, there is no individual, there's no shareholder, there's no one that has some check that says, you know what, we're actually not going to buy that drug, because it costs too much, or, hey, we need an alternative.

If every individual had to pay for their drugs or private insurance was the only way to get your drugs was through private insurance, we would have a much more dynamic marketplace. So the way that we negotiate drug prices is pretty messed up. There's also this construct in the market. These PBMs are pharmacy benefit managers. If they got cut out of the market, it would save a lot. I'll just give you guys some numbers on these PBMs. There's three major PBMs, CVS Caremark, Express Scripts, it would save a lot. I'll just give you guys some numbers on these PBMs. There's three major PBM CVS Caremark Express Scripts and Optum RX. These three companies make

on average approximately three bucks in operating profit per prescription claim processed. They make money in markups. The FTC has been investigating them and have several open cases between 2017 and 2022. The estimate that these companies generated $7.3 billion in excess profit by marking up prices on specialty generic drugs. The list goes on on kind of the egregious behavior and the role that they play as middlemen in the industry, their job, and I'll kind of describe it as to be the managers of prescription drug benefits on

behalf of the health insurers, large employers, Medicare Part D plans and other payers. So as an intermediary, they provide this role where they can coordinate between the health insurer, the pharmacy which dispenses the drugs and the drug manufacturers. But they're allowed to be owned by the payer, which is crazy.

And now they're allowed to be owned by the payer. And there's a lot of obfuscation of the true cost of the drugs. There's a lot of markups, a lot of spread taking. And so if you took the PBMs out of the market, that would solve one of the problems. But at the end of the day, I've said this many, many times before, anytime the federal government is involved as a payer in any market based system, it creates a distortion and the market is no longer free or efficient. All right for Ben Shapiro of the Ben Shapiro show and daily wire, polyhobby Tia and David Friedberg, I am executive producer for life. We'll see you all next time. Love you boys. Bye bye. I'm going all in We'll let your winners ride Rain Man, David Sack

I'm going all in And instead we open source it to the fans and they've just gone crazy with it Love you, Weston I'm going all in I'm going all in I'm going all in I'm going all in Besties are gone

That's my dog taking an illness to your driveway Sex Oh man Oh man My half a dash or we'll meet me at the hospital We should all just get a room and just have one big huge orgy Cause they're all just useless It's like this sexual tension that they just need to release somehow

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