Pete Hegseth shocks Democrats at his confirmation hearing by pledging to restore warrior culture through meritocracy, rejecting DEI quotas, and demanding women serve in combat only if they meet identical standards as men. While senators attack his past personal life and refusal to pledge against future defense industry work, Shyam Sankar of Palantir argues the DoD must end bureaucratic monopsonies and cost-plus contracting to reindustrialize America. Sankar emphasizes that winning requires shifting from human-speed processes to machine-speed sensor-to-shooter kill chains, leveraging a unique American cultural legacy of trust and open communication that rivals like China cannot replicate. Ultimately, the episode suggests that defeating modern adversaries depends on replacing sclerotic regulations with aggressive innovation and an unwavering focus on lethality over political correctness. [Automatically generated summary]
Senator Marco Rubio, who is the nominee for Secretary of State.
He is having his hearing today.
Pam Bondi, the Attorney General nominee, she's having her hearing today.
But the big story of the day is what Pete Hegseth did as Secretary of Defense nominee in front of a Senate committee yesterday during his Senate hearing.
We'll get to all that in a moment.
First, remember, history is happening.
You can watch it live with us here at The Daily Wire.
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Plus, celebrate with 47% off your Daily Wire plus annual membership.
Join us at dailywire.com slash subscribe using code 47. So, Democrats thought that they were going to be able to get Pete Hegseth in the crosshairs, and then they were going to be able to do syrigous damage to Pete Hegseth and to Republicans for having nominated Pete Hegseth.
Boy, were they wrong.
The Wall Street Journal writes, During a Senate hearing, Hegseth pledged to restore the U.S. military's warrior culture, declaring his service as a National Guard junior officer in Iraq, Afghanistan, and U.S. military prison at Gitmo would bring a needed refocus to a Pentagon he claimed was concerned more with diversity and equity than lethality and readiness.
And Hegseth was great, like not just good, great, iconically great yesterday in front of the Senate Armed Services Committee.
Democrat after Democrat lined up to attack him, particularly on his personal life, and Hegseth weathered it like a champ.
He came back at them where they said particularly stupid things, and he said some things that need to be said.
This is a very different Secretary of Defense nominee.
Not only is he a person who actually served in the infantry, not only is he a person who's quite bright, obviously he has degrees from both Harvard and Princeton, but Hegseth also has the perspective of the guy on the ground who actually has to do the fighting.
He is not a political general who is elevated through the ranks for being able to get along with his superiors.
That's not who Pete Hegseth is.
He's an outsider who's being brought in to shake things up.
Because guess what?
The Department of Defense needs a good shaking up.
He said a lot of things yesterday.
Many of them were quite wonderful.
Here, for example, is Pete Hegseth yesterday who's being questioned about his adherence to things like the Geneva Conventions and his comments that American warfighters have to be given the ability to actually win.
The answer to that, by the way, is absolutely yes.
Here was Hegseth yesterday talking about the difference between the guys in the air-conditioned offices and the guys with their boots on the ground.
Because in those ground combat roles, what is true is that the weight of the ruck on your back doesn't change.
The weight of the 155 round that you have to carry doesn't change.
The weight of the 240 Bravo machine gun you might have to carry doesn't change.
And so whether it's a man or a woman, they have to meet the same high standards.
And Senator, in any place...
Where those things have been eroded or in courses, criteria have been changed in order to meet quotas, racial quotas or gender quotas, that is putting a focus on something other than readiness, standards, meritocracy and lethality.
We won World War II with seven four-star generals.
Today we have 44 four-star generals.
There's an inverse relationship between the size of staffs and victory on the battlefield.
We don't need more bureaucracy at the top.
We need more warfighters empowered at the bottom.
So it's going to be my job working with those that we hire and those inside the administration to identify those places where fat can be cut so it can go toward lethality.
Everybody in this room knows if you're a rifleman and you lose your rifle, they're throwing the book at you.
But if you're a general who loses a war, you get a promotion.
That's not going to happen in Donald Trump's Pentagon.
There will be real standards for success.
Everyone from the top, from the most senior general to the most lowly private, will ensure that they're treated fairly, men and women, inside that system.
And my answer is yes, exactly the way that you caveated it.
Yes, women will have access to ground combat roles, combat rows, given the standards remain high, and we'll have a review to ensure the standards have not been eroded in any one of these cases.
That'll be part of one of the first things we do at the Pentagon, is reviewing that in a gender-neutral way, the standards, ensuring readiness and meritocracy is front and center.
But absolutely, it would be the privilege of a lifetime to, if confirmed, to be the secretary of defense for all men and women in uniform who fight so heroic.
They have so many other options.
They decide to put their right hand up for our country.
Senator, I support, I am a Christian and I robustly support the state of Israel and its existential defense and the way America comes alongside them is their great ally.
Because another protester, and I think this one was a member of Code Pink, which by the way is a Chinese communist front group these days, said that you support Israel's war.
In Gaza, I support Israel's existential war in Gaza.
I assume, like me and President Trump, you support that war as well, don't you?
A little bit later on in the show, we're actually going to sit down with the chief technology officer of Palantir, which is one of the new defense firms, not one of the kind of old dinosaurs, that is trying to think differently about how defense policy should be done.
I want to get into the specifics of what needs to happen at the DOD. While Joe Biden is handing off to Pete Hegseth and team, an uncertain world with an uncertain economic landscape.
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Okay, so as we'll see, Democrats lost their minds over all of this.
They could not believe that Pete Hegseth was the nominee.
So Senator Gary Peters of Michigan, he ripped into Hegseth saying, you are unqualified.
Now again, all the Democrat qualifications in the world, they don't seem to matter.
Because for Democrats, the qualification is not how you will actually run the Defense Department or whether your ideology on defense is correct.
It's apparently whether you ran a big business beforehand or whether you spent 30 years climbing the ranks of the military by kissing enough ass.
These are apparently the things that make you qualified to run the Department of Defense, as opposed to what you are going to do.
Of course.
So here is Senator Gary Peters getting very miffed, incredibly miffed, that Pete Hegseth is going to be Secretary of Defense.
unidentified
Do you think that the way to raise the minimum standards of the people who serve us is to lower the standards for the Secretary of Defense, that we have someone who has never managed an organization, more than 100 people, is going to come in and manage this incredibly important organization and do it with a professionalism and has no experience that they can tell us that they have actually done that?
I mean, well, if he hasn't run a giant organization.
Then how can you possibly run the Department of Defense?
Well, maybe by making it a smaller organization might be one answer.
And then you have Senator Jack Reed, who dropped the laugh-out-loud funny line that we are a more lethal military thanks to diversity.
I'm sorry, I don't see the correlation.
It doesn't seem to me that if you were just recruiting a military from scratch, your first question would be, how many black, Hispanic, Jewish, and Asian people are there in this military?
That shouldn't be your first line of demarcation.
In terms of an effective fighting force.
But according to Jack Reed, this is the thing that makes the American military deadly, is that we have more minority lesbians or something.
Our military is more diverse than it has ever been, but more importantly, it is more lethal than it has ever been.
This is not a coincidence.
Mr. Hegstead, I hope you'll explain why you believe such diversity is making the military weak and how you propose to undo that without undermining military leadership and harming readiness, recruitment and retention.
Everybody who's showing up to the office is too fat.
It's really a massive problem.
They have massive recruitment shortages.
And Jack Reed's like, well, I mean, what are we going to do if we don't have enough overweight transgender people in the military?
How are we going to solve our recruitment crisis without those people?
Well, maybe the answer to solving the recruitment crisis is making it appear to be badass to be in the military.
Every single member of the military I've ever met, and I've met many, many, many members of the military, they all joined up because they thought that it was an awesome thing to do.
They all joined up because they wanted to be part of the defense of the country.
And yes, because the vast majority of people who joined the military are men.
And there is a masculine energy to the military.
This is just the way it works.
Restoring that is not a bad thing.
It's a very good thing.
But, you know, the Democratic objections continued.
Senator Elise Slotkin of Michigan, she suggested that Hegseth is going to follow illegal orders given by President Trump, and Hegseth just wasn't even buying the premise.
In June of 2020, then-President Trump directed former Secretary of Defense Mark Esper to shoot protesters in the legs in downtown D.C., an order Secretary Esper refused to comply with.
Would you carry out such an order from President Trump?
Senator, I was in the Washington, D.C. National Guard unit that was in Lafayette Square during those events holding a riot shield on behalf of my country.
He says he's going to abide by the law, and then she refuses to hear his answer.
But this is the way.
They work.
Maisie Hirono, by the way, then decided to go even further.
She said, will you resign if you drink on the job?
It is all based on these anonymous smears that Hegseth is a heavy drinker, despite the fact that everybody at Fox has said that that is not true, despite the fact that pretty much all of his former colleagues say that's not true.
Here is Hirono claiming that Hegseth is a sloppy drunk.
I want to return to the incident that you referenced a minute ago that occurred in Monterey, California in October 2017. At that time, you were still married to your second wife, correct?
So you think you are completely cleared because you committed no crime.
That's your definition of cleared?
You had just fathered a child two months before by a woman that was not your wife.
I am shocked that you would stand here and say you're completely cleared.
Can you so casually cheat on a second wife and cheat on the mother of a child that had been born two months before and you tell us you are completely cleared?
So Senator Mark Wayne Mullen eventually had had enough of this, the senator from Oklahoma.
What I think is one of the great moments in modern Senate history, where he effectively stood up on his hind legs and he said, listen, all you drunken leches in the Senate, and there are a lot of them, the amount of drinking that goes on in the Senate, the Senate could provide the entire market for grain alcohol in the United States.
There are so many drunks, so many cheaters on their wives in the Senate.
It is not a place filled with virtuous men.
It really is not.
And Mark Wayne Mullen makes this point.
So you're going after Hegseth for something that he's lived through and apologized for in a way that, by the way, Bill Clinton never did.
Tim Kaine ripping into Hegseth.
He ran with the wife of the person who is the biggest cheater as president, exposed before the American public, and the woman he ran with literally threatened alleged victims.
I mean, that is who Tim Kaine ran.
And then he sits there judging Pete Hegseth, who, again, has repented of the sin.
Here's Mark Wayne Mullen going after his fellow senators.
unidentified
And then Senator Cain, or I guess I better use the senator from Virginia, starts bringing up the fact that what if you showed up drunk to your job?
How many senators have showed up drunk to vote at night?
Have any of you guys asked them to step down and resign from their job?
And don't tell me you haven't seen it because I know you have.
And then how many senators do you know have got a divorce before cheating on their wives?
I couldn't tell you the exact amount of nations in that.
But I know we have allies in South Korea, in Japan, and in AUKUS with Australia, trying to work on submarines with them.
unidentified
None of those countries are in ASEAN. None of those three countries that you've mentioned are in ASEAN. I suggest you do a little homework before you prepare for these types of negotiations.
Okay, you literally put on the Supreme Court a woman who doesn't know what a woman is.
I think we all know what a woman is.
It might take a few of us, you know, like a quick check of the internet to figure out which countries are in ASEAN. But like, that's the disqualifier?
That one is the disqualifier?
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Well, you also write in your book, The War on Warriors, with the chapter, The Deadly Obsession with Women Warriors, that, quote, not only are women comparatively less effective than men in combat roles, but they are more likely to be objectified by the enemy and their own nation in the moral realms of war.
Mr. Hegseth.
Should we take it to believe that you believe that the two women on this committee who have served honorably and with distinction made our military less effective and less capable?
In the end, it was Tim Sheehy, again, another member of the military, who was questioning Hegseth in what was, I think, probably the best exchange of the day.
Sheehy said to Hegseth, listen, this is all very basic.
How many genders are there?
Let's start with, like, that baseline question, which is something that apparently Mark Milley, that chairman of the Joint Chiefs, can't answer.
In the end, as Mark Wynn-Mullen says, Hexeth is going to get 51-52 votes in the Senate minimum, and he should.
He will be your new Secretary of Defense, and that is going to happen this week.
Meanwhile, other nominees are having their hearings as well.
Apparently, Marco Rubio is having his hearing today.
In that hearing, he said, in his opener speech, he said, placing our core national interests above all else is not isolationism.
It is the common sense realization that a foreign policy centered on our national interest is not some outdated relic.
The post-war global order is not just obsolete.
It is now a weapon being used against us.
That is absolutely correct.
That is absolutely correct.
This idea that there is a quote-unquote liberal world order that requires us to pre-clear our actions with the United Nations.
That international law from the ICJ and ICC is something that is worth our respect.
Or that the most important thing to the United States should be upholding some vague standard of Wilsonian international justice.
It's nonsense.
Rubio knows that.
Rubio will be confirmed as well.
The two other controversial nominees are going to have their hearings in very short order.
Those two most controversial nominees are, of course, RFK Jr. and Tulsi Gabbard.
Tulsi Gabbard has been making significant inroads with the Senate.
She's been vowing, for example, that she is going to, as Director of National Intelligence, not get rid of Section 702, which is the way that the U.S. intelligence community actually can monitor the communications of foreign entities.
Also, because Democrats are going so hard at Hegseth, they're actually expending all their ammo that they theoretically could have aimed at Tulsi Gabbard.
This is a point being made by Jonathan Martin over at Politico.
He says the disproportionate attention to Hegseth's nomination.
by the press and senators in both parties has been a gift to Gabbard.
Since Hegseth's November nomination, Democrats have focused the bulk of their attention on the former Fox& Friends weekend host, effectively taking their cues from the extensive press coverage.
However, they have not actually turned their fired to Tulsi Gabbard at this point.
Meanwhile, RFK Jr. The Trump team is working to sort of smooth off the rough edges of the RFK Jr. nomination.
According to the Wall Street Journal, two vaccine skeptics who'd been advising RFK Jr. have been sidelined by the Trump transition officials.
Advisor Stephanie Spear and lawyer Aaron Seary had asked prospective administration hires about their beliefs around vaccines, even if they were interviewing for posts that had little to do with immunizations.
The questions were different from those asked in separate meetings with President Trump's staff, according to some of the people.
Trump's team asked about topics traditionally important to conservatives, like the size of government and deregulation.
Syria is no longer advising the presidential transition.
Speer was passed over for the post of chief of staff in favor of a veteran of the first Trump administration.
And again, one of the reasons for that is because RFK Jr.'s opposition to vaccines is not relegated to his opposition to, for example, the mRNA vaccines, treatment of COVID and all the rest of that, which again has become highly controversial and the data of which was skewed when it was first released.
It extends to many other vaccines.
He's made statements in the past that...
Broad writ applied to lots of vaccines.
And so one of the things that the Trump team is attempting to do in getting RFK Jr.'s nomination shepherded through Congress is ensure that he doesn't have people around him who can be characterized as totally anti-vax in general, which again is a smart move by Team Trump.
Well, meanwhile, the House of Representatives is already getting active.
Yesterday, they passed a ban on men who say they are women from participating in women's sports.
The bill passed 218 to 206. All Republicans present voted yes.
Only two Democrats, only two Democrats voted yes.
And Democrats cannot shake the woke.
They cannot.
It is amazing.
Okay, this is a death knell for Democratic electoral prospects.
Their continued maintenance of the idea that boys can be girls, girls can be boys, and men should compete against women while pretending to be women is a horrifyingly bad political decision.
And yet they still continue to trot out absolute imbeciles.
Like Alexandra Ocasio-Cortez to make the case here yesterday was Alexandra Ocasio-Cortez explaining that it's terribly sexist not to allow boys to compete with girls.
But they are so attached to their woke principles, they cannot let it go.
Meanwhile, Speaker Johnson, again, passed his first test with flying colors, somehow cobbling together enough of the House Republican majority to be re-enshrined as Speaker of the House with the very important support of President Trump.
I mean, probably the most famous ad of the campaign cycle was the one that the Trump administration ran on this issue, and it resonates with the American people.
Congressman Stubbe mentioned it in the opinion polls.
This is an 80%, 90% issue or more, depending on which poll you look at, because, again, it comports with common sense.
It should not be a partisan issue.
We should have every single member of Congress united on this.
And I would challenge all of you to go ask the questions of the Democrats who voted against it, how in the world they can justify that?
But common sense left the Democratic Party long ago.
Speaking of which, we'll get into the latest from California, which continues to be just insane, in one second.
First, are you tired of winning yet?
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Meanwhile, the situation in California continues to be quite dire.
It is not as though these fires are under control.
The fires are still raging out of control.
The winds are picking up once again.
The wildfire map continues to be extraordinarily large.
The Palisades Fire has been burning for eight days.
It is still only 18% contained.
It has burned almost 24,000 acres, and the winds are expected to pick up today as well.
The Eaton Fire, which has burned 14,000 acres, is only 35% contained.
It seems as though the most populated areas have basically been prevented from being eaten by the fire, particularly the Palisades fire.
And it looks like the map is moving more out to the west than it is to the east at this point.
So the map has not moved more toward Bel Air or Brentwood, for example, but it is moving out more toward the Ventura area, toward Malibu West and such.
Meanwhile, the person with the priorities is Gavin Newsom, the governor of California.
It is truly incredible how unbelievably incompetent they are and how wedded they are to their left-wing ideals.
So, let's say that your house burned down in this fire.
God forbid.
It's really terrible.
Let's say that your house burned down in the fire and you are left with the charred remnants of your old family home in an area that's not going to be livable for a while because after a wildfire hits an urban area, after it burns down a bunch of homes, It's not as though the rebuilding takes place immediately.
There's toxic waste there.
There's serious problems in these areas.
And let's say a developer comes to you and says, listen, you didn't have fire insurance because the state of California made it nearly impossible for you to buy affordable fire insurance.
It's going to be a long time until you see a check.
I'll give you $2 million today for your property.
According to Gavin Newsom, that developer is a leech, cruel, and must be stopped.
That sort of free market activity, that can't be allowed.
They're bringing you an unsolicited...
Now, listen, you could say no to that offer, but the fact that they are even making an offer shows how greedy and terrible they are.
Here is Gavin Newsom speaking up against free markets after his complete botchery of this fire.
I just signed an executive order with community leaders to deal with the issue that is becoming a bigger and bigger issue every day.
And that's land developers that are engaging in predatory efforts to make unsolicited offers for properties at significantly below market value.
This predatory behavior is disgusting in the best of times.
And of course, here in the midst of this tragedy at scale, it's disgraceful.
So we're going to hold those folks accountable.
I'm very grateful for the leadership here in the community that promoted this approach and this executive order's reflection of their direction and their commitment to preserving the unique character of this community for generations to come.
Well, it wouldn't be a full-scale tragedy without Jimmy Kimmel tearing up on air because this is what you want from your late-night comedians is lectures about politics and tearing up, which is what Jimmy Kimmel has become famous for.
He's no longer famous for making jokes.
It is truly impressive how, in our culture-centric universe, I think I speak for all of us when I say it has been a sickening,
shocking, awful experience, but has also been, in a lot of ways, a beautiful experience because Once again, we see our fellow men and women coming together to support each other.
People who lost their own homes were out volunteering in parking lots helping others who lost theirs.
And tonight, you know, I don't want to get into all the vile and irresponsible and stupid things our alleged future president and his scumbags chose to say during our darkest and most terrifying hour.
The fact that they chose to attack our firefighters who apparently aren't white enough to be out there risking their lives on our behalf is it's disgusting, but it's not surprising.
They were attacking the entire system that allowed this to happen, including the underfunding of the fire department for paying gigantic pensions and salaries negotiated by unions, which prevented the staffing up of the fire department.
Yeah, it seems to me that if your top priority is hiring people who literally say that it's not their job to pull men out of burning buildings because the men shouldn't have been there in the first place, that seems like that should be a question that should be asked.
I mean, anytime, let alone in the middle of the most devastating wildfire in American history.
So thanks to Jimmy Kimmel for, as always, his moral clarity.
Meanwhile, Joe Biden is expected to make his valedictory address tonight.
He's going to explain why he was such a wonderful president.
And honestly, I'm grateful to Joe Biden for ripping the lid off the incompetence of the Democrats.
For bringing us a second Donald Trump term, that is what he's mostly going to be remembered for.
On his way out, he's doing everything he can to screw things up.
According to the Wall Street Journal, days before President Biden's term ends, his administration said it would remove Cuba from the U.S. list of state sponsors of terrorism as part of a deal worked out with the help from the Catholic Church to free political prisoners on the island.
U.S. officials said the decision, which comes less than a week before President-elect Trump's inauguration for a second term, would lead to the release of many dozens of Cuban political prisoners.
The Cuban foreign ministry said it would free 553 prisoners.
According to the Wall Street Journal, banks almost universally shun Cuba because of the terrorism listing.
The decision to take it off the list if it stands could be the first step in helping Havana obtain some financial...
Relief.
Biden officials described the action as a gesture of goodwill after a U.S. review found, quote, no credible evidence at this time of ongoing support by Cuba for international terrorism.
Well, suffice to say, I do not trust the Biden administration in their assessment.
Senator Rick Scott of Florida slammed the move as a parting gift to dictators and terrorists around the world.
Florida Democrats, too, condemned it.
They said, quote, we condemn in the strongest terms Cuba's removal from this list.
That seems exactly correct, but again.
They're going to do as much damage as they can on the way out the door.
That's also true of the Securities and Exchange Commission, just days before Donald Trump is set to take office, just days before Doge is set to get to work.
That is the Elon Musk, Vivek Ramaswamy-led agency that is focused in on governmental efficiency.
U.S. securities regulators, according to the New York Times, have now sued Elon Musk in federal court in Washington on Tuesday in an enforcement action arising from his $44 billion purchase of Twitter, now called X. The SEC contends that in buying Twitter in 2022, Musk violated securities laws by amassing a large stock position in the social media company without filing proper notification.
The complaint said he waited 11 days before filing the required disclosure with the SEC. Well, he ended up taking Twitter private at a price of $44 billion.
According to the SEC, because Musk didn't disclose his position, he was able to continue buying Twitter stock at an artificially low price.
The move allowed him to underpay by at least $150 million for the additional shares before disclosing his stake.
He paid $44 billion for a social media service that, at this point, I have no idea what it's worth.
They named $44 billion.
So in other words, here's how the process went.
He offered that he was going to buy the place at like $44 billion.
And he was starting to buy up shares.
And everybody was like, okay, that's sure.
Twitter's like, okay, we'll take it.
And then he was like, okay, hold up a second.
It seems as though there's a lot of bots on the service and a lot of fake numbers around the service, and I don't want to pay that $44 billion.
And the government stepped in and sued, and he was like, okay, fine.
I guess you've got, fine, sure.
I'll buy it for $44 billion.
Now the government's like, well, you're not, you know, you paid too much money.
And he's like, I know I paid too much money.
They're like, but you didn't pay enough.
Like, what in the world?
What in the world?
His lawyer, Alex Spiro, Denounced the filing.
Quote, today's action is an admission by the SEC. They can't bring an actual case because Musk has done nothing wrong and everyone sees this sham for what it is.
This is the third time the SEC has gone to court with Musk.
The first was when they went to court claiming that he'd made an inappropriate market-moving post on social media talking about taking Tesla private.
Gary Gensler, who's been just an awful SEC commissioner, is leading the way.
All these agencies are staffed up by some of the worst people in America, truthfully.
And they need to go.
Alrighty, folks.
So, because we are going to have a new Secretary of Defense, I wanted to discuss in depth what a better defense policy would look like.
And so I sat down just a couple of days ago with the Chief Technology Officer of Palantir, which is one of the new defense firms that is doing significant work in modernizing the military, taking creative approaches to the military.
It is not one of the dinosaurs, one of the old dinosaurs that are getting paid billions of dollars to generate parts for the F-35.
Well, I mean, the goal of defense is to deter conflict.
And actually, I think in many ways, the budget should be much less.
I think a lot of what we're spending on defense right now ends up being effectively a jobs program.
And the part that we're spending on actually deterring our adversaries, actually scaring she.
Now, I think there's a lot of ways that we can do that well within our fiscal means and constraints, and that's really what I argue for in the Defense Reformation.
Yeah, so people are very familiar with the term monopoly, and we look at monopolies with great skepticism, where there's a single seller of a product in the market.
Well, monopsony is the mirror image of that, where there's a single buyer for a thing.
And as free market patriots in America, we believe in the value of the free market.
So when you have a monopsony, when you have a single buyer, when there's only one person who's interested in buying an aircraft carrier, you lose all of the benefit of the free market, all the benefit of a million individual voices trying to decide what a good product is and the signal that comes from that.
So the monopsony is accrues a lot of power in deciding what it is that they should have.
And it deprives power from the entrepreneurs, from the engineers, the innovators on what they could do to solve your problems.
And so this dynamic that kind of leans into the fetishization of control of like, no, I'm telling you, this is what the plane needs to do.
That's how you end up with programs like the F-35, where that project was conceived of in So, how do you solve that problem?
But you do your best to approximate free market forces.
And this is not some pie-in-the-sky fantasy.
If we look at when we used to do projects where they really worked, like how did we build the intercontinental ballistic missile back in the 50s and 60s?
Well, we actually had all the services competing against each other.
The Army, the Navy, the Air Force.
There was no monopoly.
There was no one who was saying like, well, this is obviously the Air Force.
Today we think about it as the Minuteman.
That's who won.
But that was not a...
Forgone conclusion.
When you think about submarine-launched ballistic missiles, Admiral Rayburn actually had four competing programs within the Navy to produce those things.
The challenge that we have with that is really an aesthetic challenge, where we look at it today with almost a Soviet aesthetic, where we say, that sounds duplicative, that sounds wasteful.
Shouldn't we just have one effort where we put all of our energy and resources behind it, and we lose out on the magic, the American magic of competition?
And the idea that actually there are lots of competing ideas and we're all going to do better because there are four competing programs instead of a single unitary effort where there's no innovation, there's no incentive to actually disrupt yourself in order to win.
I mean, that's really fascinating because it's so counterintuitive.
The way that most people tend to think of bureaucracy is, well, as the bureaucracy multiplies, then you get more confusion and more cost and more waste.
You're suggesting is actually when you have a monopoly of demand inside, say, the Defense Department, it's one guy deciding, here's the things I want, that's when you get the most waste.
I think that's right, because there's just no check and balance, right?
Like, how do you know this zombie program, is it a zombie program or is it the definitive program that's going to deliver deterrence or not?
And so you need some of that pressure.
I think one of the great advantages that we really have, if you think about how the department is structured, is we have what we call the combatant commands, right?
So we have these 13 different places, like...
Like the Indo-Pacific, as one example, or CENTCOM, where the geographic combatant commanders, they actually fight the war.
And to use it in business parlance, they're responsible for responding to real-world demand.
The services, the Army, the Air Force, the Navy, they're responsible for the supply side, for presenting forces, for building the equipment and the material and training the soldiers and providing that to the combatant commanders.
But we have 13 of them.
We can actually use this to approximate a market.
And why should we presuppose that what Admiral Paparo needs in the Pacific is going to be exactly the same thing as what General Crilla needs in the Middle East?
That doesn't really make sense.
So we need to create mechanisms for each of these combatant commanders to express their demand.
This is what I need from the services and the forces.
Be able to control some of that budget, which today we don't let them do, so they can match their own in supply and demand.
Well, the other industry that loves cost-plus is general contracting.
And I don't know if anyone's gone through a home remodel who's listening to this, but most people are not pretty happy with how that's gone.
Somehow, for the contractor to get more plus, the cost has to go up, and that's what seems to happen.
And it lacks the natural incentive to figure out how to manage this within your own means or to drive innovation against that cost phase.
So cost-plus, where did this really come from?
It came from the era of mobilization around World War II, where it makes a lot of sense.
We took a bunch of...
Auto companies and other parts of the American industry, and this was complete mobilization of our economy.
You're going to have to build things you never built before.
You don't know what it's going to cost you to build it.
I'm going to just tell you, build it.
The nation needs it.
And here's some baked-in profit.
So that was the right model for the moment.
It's not the right model anymore.
If you look at what SpaceX has been able to do with Space Launch, you know, I grew up in the shadow of the Space Coast.
I used to love watching the shuttle launch.
The shuttle, it was $50,000 a kilogram to get to orbit.
With Starship-heavy reuse that's imminently coming, Elon has made that $10.
$10!
You know, and so if you were doing this under a cost-plus regime, he would have reduced his profit a huge amount there because the cost just went down a huge amount.
That doesn't make sense.
Elon should be rewarded for the massive innovation that means that our nation has the most assured access to space, and that is...
Both delivering untold national security and prosperity for us.
And I think a big part of what mobilized Elon to do that is not national security, it's getting to Mars.
He needs that price performance in order to get to Mars and the whole of nation benefits.
So I think the cost plus locks you into basically very linear outcomes that don't allow you to have transformational defense capabilities at all.
And what we really want to move to is a world that has powered all of America's prosperity, which is an entrepreneur, founder-driven innovation economy where people actually invest their own capital.
You know, America's capital markets are the deepest and richest in the world.
Let's invest American capital, build things, and show them to the department and let the department decide if they want to buy it or not.
And they can buy it as a commercial product.
You know, not having sunk U.S. taxpayer R&D into developing these things, but rather putting that risk on private capital and deciding what works for them.
And this is probably the most important point, which is dual use and I'd say dual purpose.
So we forget that the industrial base, we call it today the defense industrial base, but the industrial base that won World War II and the early Cold War was an American industrial base.
Chrysler built cars and missiles.
Ford built satellites until 1990. General Mills, the serial company, made torpedoes and artillery.
So the entire structure of the U.S. economy, we were all invested as corporations in both.
National security and prosperity.
And I think we've lost a lot by how it's rotated.
And if you look at the fall of the Berlin Wall, that moment in 89, only 6% of major weapons system spending went to defense specialists, the so-called primes.
Most of the spending went to these dual-purpose companies like a Chrysler.
Now, if you look at that figure, it's 86% goes to defense specialists.
So we've lost quite a bit.
And that's a consequence of the luxury of having, quote-unquote, you know, having won the Cold War.
You know, without a near-peer or a peer threat and kind of the lack of pace that we needed to follow, you know, we got to kind of lean into the monopsonous preferences for control and the fetishization of how they were going to go about doing this rather than leveraging the breadth of the American economy to deliver national security and prosperity for its people.
Yeah, I think reindustrializing the nation is, you know, it's a complete clarion call.
If you look at, you know, the amount of weapons that we have on hand to fight China, it's roughly, war games put it at eight days.
It should be closer to 800 days.
And I think one of the things that we lost as a consequence of, you know, winning the Cold War, we got confused at the stockpile.
It's not the stockpile.
You know, it's the ability to make the stockpile.
So if it takes you eight years to make a Patriot battery or two years to make a long-range anti-ship missile and you're only making them in quantities of tens or hundreds...
That's not going to provide deterrence.
And I think Ukraine was a painful lesson to that.
Regardless of how you feel about our support for Ukraine, if you realize that they went through 10 years of our production in 10 weeks of fighting, you realize you have a problem.
And we have grossly under-resourced the lines of production and exercising those lines of production.
We have this fantasy that it'll be just like World War II where we just...
Quote, unquote, flip a switch and, you know, we can just go back to making these things.
But that's not even what happened in World War II. We started, you know, it took 18 months to mobilize it, you know, 12 months to build factories, six months to retool them.
And so there's a certain sort of seriousness that we need to have to this if we want to deter conflict here.
Well, I think there are probably like four or five priority areas, including counter-UAS. The things that right now we have real issues with, how our level of deterrence and overmatch against the threat is not high enough.
And those areas is where we need to have more multiple competing programs and efforts, less unitary efforts.
And we need to bring the breadth of the American industrial base.
You could ask yourself the question, Counterfactually, how bad would the world have to be before you wanted to bring Tesla into munitions productions using DPA authorities?
Because it's not true that we're not good at making things in this country.
It's just that the ability to do that in a modern way is asymmetrically distributed.
You know, SpaceX makes so much of what they do vertically integrated internally, and they do it at a price that is eye-watering.
Tesla, it's really a software-defined production line.
How they do it and how they version it, it's quite exquisite.
And then you have all these founders now who have grown up in the school of Elon, who are building their own companies in El Segundo, who are bringing modern manufacturing techniques back to America.
I think we need to invest in that and really harness that.
Now, I think a lot of this has been hollowed out through the kind of MBA-ification of how we run our companies here.
We've traded real engineering for financial engineering.
You know, when I interact with, you know, 50% of what we do is actually commercial, working, you know, building Airbuses and Chryslers and, you know, hundreds of thousands of users on the factory floor using the software.
When I interact with these companies, their understanding of their supply chain is very shallow.
very shallow.
You know, they kind of treat it as a black box where I have these suppliers, I buy these things.
They kind of treat it as a black box where I have these suppliers, I buy these things.
They don't know how to make those things.
They don't know how to make those things.
They don't understand how far down it goes.
They don't understand how far down it goes.
That couldn't be any more different than how Elon and SpaceX view the world and the deep control.
So I think the future of American manufacturing looks much more like that, getting to a place where we, you know, David's slingshot, so to speak now, is both software defined and we're competing differently than China.
So, So unfortunately, at the dawn of World War II, we were the best at mass production.
Today, our adversary is.
So we shouldn't compete symmetrically in re-industrializing.
We're going to have to use a different approach to doing it.
And I think we've already seen that that approach can work in America.
We need to give American workers superpowers with the technology that we have a unique advantage in.
And we need to use the techniques that Elon and others have shown can really work to bring that work back.
So, there's going to be, obviously, a lot of systemic resistance to this sort of stuff inside DOD. The new Secretary of Defense is going to face down people who have been in these jobs for decades.
I mean, this is true throughout all of the agencies, but it's particularly true at DOD, which, of course, we're spending trillions of dollars on every year.
What exactly needs to happen in terms of staffing?
Because we can have these ideas, but it's the implementation that's really going to matter.
Well, I think that the person is the program is what I like to say.
We call it the Apollo program, but maybe more accurately, we should call it Gene Kranz's program.
You know, is the F-16 the F-16 or is it John Boyd's plane?
You know, we have the nuclear Navy because Admiral Rickover worked on it for 30 years and he had to be protected by Congress.
Like today, having an admiral in place for 30 years, we couldn't even imagine that.
And these personnel, Edward Hall built the Minuteman, you know, Kelly Johnson built 41 airframes in his career.
He built the U-2 in 13 months.
So there is something, you know, Profoundly valuable about these founder personalities.
And I think of all nations in the world, we understand that.
There's a reason we call them the founding fathers.
And I think what we've kind of lost is we've built a military cadre where they need to rotate every two to three years.
It's about collecting experiences, about filling out a bingo card, rather than the deep work of actually delivering capabilities for the nations, focusing on the output here.
So I think by recognizing that first.
And then putting the right people in place for the duration that's required against the capabilities we need, that's a precondition.
The second one is, let's not grant monopolies on these efforts.
We're going to have to have multiple players in the field, multiple competing efforts that enable us to focus on winning.
You know, we can't be so focused on the inputs on, like, is this efficient?
Is it not?
It's very hard.
You know, innovation is messy and chaotic.
And the reason we have this weird sclerotic system is because every time something went wrong in this messy and authentically chaotic process, we try to come up with a rule to make it less messy and less chaotic.
And what you're really doing is if you're chopping off all of the tail of bad outcomes, you can't do that without chopping off all the tail of good outcomes.
So, when you look at sort of the weapons systems from a layman's perspective, when I think of military equipment, I'm thinking of aircraft carriers, I'm thinking of F-35s.
How much of that is a waste?
I mean, what are the things that we should be looking at as the American public, the sort of technologies of the future, in your opinion?
Obviously, people have talked about drones, people are talking about automation.
So I think there's almost like a false choice presented in, is it going to be all unmanned autonomous systems, or are we committed to the big legacy platforms?
Really, the question is, what is the forced employment concept?
How are we going to use these things to drive effects on the battlefield that deter our adversaries from creating problems in the world?
I think we need a lot more experimentation on that.
Right now, this stuff has been pretty siloed.
And what we see with the Ukrainians, I think one of the lessons there is really how fast you can go when you have these, the right sort of effort.
So one of the conclusions people have that I think might be slightly wrong is like, isn't it amazing that even though they didn't have a Navy, they were able to sink half the Black Sea Fleet, the Russian Black Sea Fleet.
I think, no, no, no, it's it's.
Because they didn't have a Navy, right?
They were not constrained by the legacy platforms and ideas here.
So they could come up with entirely new force employment constructs.
So that may seem like a contradiction, but what I'm really saying is you need these platforms, but maybe the folks who are in charge of using these platforms today are going to be the slowest to develop the new force employment constructs.
And that's where you can think of this as a thought exercise as opposed to literal, but maybe you need a Navy too.
And Navy 2 is entirely focused on unmanned approaches to delivering this, and we figure out how to bring these things together here.
So when you look at the Trump administration, you look forward to the next four years, the orientation has changed.
Obviously, this administration that is stacked with people who are from the outside of many of these agencies, it's creative and it's innovative and it's interesting.
What are your kind of hopes for what the administration looks like over the course of the next four years?
You know, I think there's been too much of a focus on process.
How did these things happen?
You know, my core critique is like everyone, including the Russians and the Chinese, have given up on communism, except for Cuba and the DoD.
You know, somehow the DoD uses five-year plans.
It's like essentially centrally planned or at worst centrally unplanned process.
It takes two years to program for money for a new start.
Can you imagine going to an American commercial company?
You have the greatest mousetrap in the world and they say, oh, this is amazing.
I can't wait to go get the money to start experimenting with this two years from now.
And certainly our adversaries don't have those constraints.
And those are self-imposed.
That's not the physics of the universe.
That's how we are choosing to organize ourselves to go slow.
And so why?
Why can't that take two weeks or at most two months?
And so I think a lot of these problems are actually problems of will and can be solved with folks who are very focused on winning and what does winning really look like.
And when I look at our past, we had all of that.
So I know with great certainty that we can do this again once we realize that we've kind of accumulated all these barnacles.
The barnacles are bigger than the ship at this point.
People love criticizing David Packard, a Silicon Valley technologist co-founder.
He founded HP. He served as a deputy secretary of defense.
So he came up with the, I think they call it the 5000 series, Rules on Acquisition.
Today, that's a 2,000-page document.
When he wrote it, it was seven pages.
So people love criticizing his sclerotic, bureaucratic contribution, but it wasn't that when he did it.
We made it that.
And I think, you know, being, you know, what can we cut back in terms of regulations?
How can we enable our warfighters to have the room to experiment they deserve?
One of the things that always breaks my heart, you hear senior generals, senior general officers, they talk about...
Something like this shibboleth is like, well, you know, we really need the oversight because we've proven that we're not very good at spending the U.S. taxpayers' money.
And I don't think that's true.
You know, when you're doing things that are this hard and this innovative, there's going to be some part of it that doesn't work.
You know, maybe one out of 10 Silicon Valley companies end up working.
Why should we think the success rate is going to be wildly different than that?
And if we kind of pretend that 10 out of 10 of these things need to work, you're just going to get people who lie about it, who, you know, effectively the incentives are all wrong.
And so we, these people have signed up to die for the nation.
We need to put a little bit of trust in them and give them some discretion.
And yeah, not all of it's going to work, but you know what doesn't work?
2,000 page documents to tell you how to run these programs.
So when you look at sort of the threats that are facing the United States right now, the sclerotic DOD procurement process, when you look at the kind of systems that are sort of legacy systems that keep pouring billions of dollars into those systems, what are your sort of top threats that you see facing the country that we need to handle in short order?