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April 25, 2025 - Bannon's War Room
48:26
Episode 4439: Trump Time Magazine Deal With It; Stopping The Hurricane Of Spenindig
Participants
Main voices
s
steve bannon
22:20
Appearances
Clips
a
andrew ross sorkin
00:40
j
jake tapper
00:08
w
willie geist
00:18
| Copy link to current segment

Speaker Time Text
willie geist ▲ ● ▼
Top of the hour, 7.02 here in New York, closing in on the first 100 days of President Trump's second term in office.
This morning, Time is out with an exclusive interview with the Commander-in-Chief, where the President discusses a range of topics from his administration following court orders to the future of Ukraine.
unidentified
National political reporter for Time Magazine, Eric Cordelesa, writes...
Asked if he had requested Bukele, that's the president of El Salvador, to return Abrego Garcia over.
Trump said he hadn't.
I haven't been asked to ask him by my attorneys, he says.
Nobody asked me to ask him that question except you.
As for the political outcry over his refusal to return a man mistakenly sent to a foreign prison without due process, Trump says he believed it will accrue to his advantage.
I think this is another men and women sports thing for the Democrats.
Another part here that was fascinating.
Has to do with the situation surrounding tariffs and the idea of the administration trying to work out deals within this 90-day framework with basically all the countries of the world.
The president and his team have said they've had 100 offers to make deals.
They say they have 18 proposals in front of them, roughly.
And then you have a great line of questioning here.
Let me read this.
Not one has been announced yet.
When are you going to announce them?
The president says, I've made 200 deals.
Then you ask, you've made 200 deals?
And then the president says, 100%.
And then you ask, I think shrewdly, can you share with whom?
And then the president says, because the deal is a deal that I choose, view it differently, we are a department store and we set the price.
Do you know?
What's going on here with his 200 deals that have been made?
I can't say that I do.
I think there are negotiations underway.
President Trump told me in the conversation that he had spoken with Xi and that the Chinese were negotiating with the Trump administration.
Commerce Secretary Howard Lutnick and another senior administration official also confirmed that to me.
The Chinese deny it.
But, you know, I think what I understood him to be saying was that he has deals worked out in his mind with all of these countries and that he believes that they will ultimately...
You know, basically acquiesce to the terms that he's laying out because he believes that the economic power of the United States and access to our markets is the leverage in order to get them to come to some sort of deal.
I don't know if they're solidified yet.
I don't know if they're already made.
But, you know, he says that within the next three to four weeks, he will be announcing everything.
Was there any sense of frustration on the part of the president?
He said he was going to end the war in Ukraine in a day.
The war, he didn't do that.
He said he was going to fix the economy just like that.
Of course, the economy hadn't been fixed.
In fact, we may be in a recession that he seems to have brought on.
Was there any frustration that he hasn't been able to deliver on a lot of the things that he promised?
You know, it's interesting because I asked about the Ukraine thing.
I said, you know, President Trump, you said you would solve this issue.
You know, what's going on?
And, you know, he said, oh, I said that in jest, Eric.
Everybody knew that that was, you know, symbolic.
You know, I wasn't really saying I was going to get it done in a day.
This has been going on for three years.
I've only been here in three months.
So, you know, I sensed that there was some frustration on his part.
And I also think, you know, he pulled back on that claim that he'd be able to solve the war in 24 hours.
And, of course, he's not wrong that it's a very complicated.
He's not wrong now that it's a very complicated issue and it's hard to solve.
And he's got intractable players in Vladimir Putin.
But I do think this is a different moment for him than the last time I spoke with him because he is right now facing all of these problems that you're talking about.
Asked if he'd like to be remembered for having expanded American territory as president himself, Trump says...
I wouldn't mind.
Again, I think this might be obvious if you listen to his territorial aspirations with Greenland, the Panama Canal and whatnot.
But still, it's pretty remarkable to hear a president say he wants to expand territory.
Yeah, I mean, you know, it's also, you know, noteworthy.
We were in the Oval Office, and, you know, he has installed many, many more paintings of former presidents in gold frames.
And there's one of James Polk, who expanded territory as well.
And I think, you know, President Trump has said he wants to, you know, acquire Greenland.
He wants to annex Canada.
He wants to seize control of the Panama Canal.
And, you know, he basically sees himself as a president who can grow the American empire, who can expand territory.
And he said he certainly wouldn't mind if that was part of his legacy.
steve bannon ▲ ● ▼
This is the primal scream of a dying regime.
Pray for our enemies.
I got a free shot at all these networks lying about the people.
The people have had a belly full of it.
I know you don't like hearing that.
I know you try to do everything in the world to stop that, but you're not going to stop it.
It's going to happen.
jake tapper ▲ ● ▼
And where do people like that go to share the big line?
unidentified
MAGA Media.
jake tapper ▲ ● ▼
I wish in my soul, I wish that any of these people had a conscience.
unidentified
Ask yourself, what is my task and what is my purpose?
steve bannon ▲ ● ▼
If that answer is to save my country, this country will be saved.
War Room.
unidentified
Here's your host, Stephen K. Vance.
you you
steve bannon ▲ ● ▼
It's Friday, 25 April, in the year of our Lord, 2025.
We're still here in Kansas City, Missouri, and had a really amazing time yesterday with the folks at Hillsdale College.
Incredible group of public intellectuals, faculty, other thinkers, Claremont, all that.
Of course, we had Sean Davis and Chris Caldwell on.
Last night to join us before the dinner.
I gave a speech last night to an audience that I think was listening.
We talked about the converging crises.
I want to really promote something this morning, if Grace and Moe would push it out, the cover of Time magazine, if we could get that up, the Time magazine cover with President Trump.
And it's this 100-day interview with Eric Corsella, the national political correspondent for Time.
Who we know pretty well.
And he's done an incredible interview.
Now I've been on Morning Joe and CNN.
I understand he's going to do Caitlin Collins tonight.
Really tough questioning.
Fair questions, tough questions.
And President Trump's responses are pretty amazing.
I wanted to discuss about President Polk.
President Polk, you know, is an amazing president and one of the most effective presidents we've ever had.
Really, one of the key figures in our country about manifest destiny and about the building of the country as a continental power.
Very controversial, only ran one term.
President Trump does have a portrait of him up there along with Jackson and others.
And, you know, and, of course, General Washington.
It is extraordinary that Eric picked up on that and discussed it with the president, that the president's got a real, you know, well-thought-through strategy here.
People are not paying enough attention, I don't think, including people at the Pentagon, I might add, given their budget, about President Trump's concept of hemispheric defense.
This is the way that gets us away from tree and dollar...
Defense budgets and being spread out over hell's half acre like having two carrier battle groups in the Red Sea to keep the Suez Canal open and to bomb the Houthis back to the Stone Age where they've been living for a long time beating the Egyptian army,
beating the Saudis, essentially beating UAE that were kind of under contract with the Saudis for years.
Polk had a very different vision of America.
President Trump's got a very different vision for this country.
That's where this hemispheric defense is so big.
And you talk about the converging crises.
One, and let's go to that again, is this stopping the kinetic part of the Third World War, which has already started.
President Trump is doing his best there, his utmost.
He's very blunt with this guy about stopping Ukraine.
I think you see the subtext.
In there, that President Trump is fully aware of the issue of getting sucked in too much.
If you read this interview and look what President Trump's been saying, he's there for a time.
Look, they're trying to do a big overall Russian rapprochement, and that will be part of it.
But Putin the other day unloading on Kiev.
Zelensky and others being slow walking the economic deal, and that's supposed to be done.
There's all kind of talk of a joint press conference.
Zelensky's going to do this.
Zelensky's going to do that.
But you can tell President Trump's patience on this is not unlimited.
And you look at the second part, the deportation of the 10 million illegal alien invaders that came in on Biden's watch already jammed up essentially at the Supreme Court.
As I said in the speech last night, the constitutional crisis part of this, and this is what they're trying to do to stop the deportation of the 10 million.
The criminals, obviously the criminal element, and President Trump doing it as commander-in-chief for our national security is self-evident that's the right thing to do.
But that's, I don't know, 100,000, maybe a couple hundred thousand.
And hey, all of them got to go.
All of them have to go.
But they're doing this to jam us up, to jam the president up so we never get to the 10 million.
We lose our will, our focus.
It's just too tough.
There's too many empathetic videos, sympathetic videos cut by CNN as you try to deport the families, which you're going to have to do.
Right?
If they're here illegally, they've got to go back, or you're never going to have the rule of law in this country.
You're never going to really secure the border.
President Trump secured it right now.
But if President Trump was not around, what would happen?
Even if you built the wall.
Because it's all about intent and focus.
President Trump has secured the border, I don't know, in 60 days, 65, 70 days, with Langford and these guys told us it was going to take decades, and they had to pass all this new legislation, and you had to have all this new money spent.
So the interview is also one of the things that's very important.
Two parts of the interview, President Trump, they talk about the tax increases.
And President Trump, Newt Gingrich and Gervin Norquist is a lot more amenable to it in this interview.
He kind of says it's the right thing to do.
His only concern, his only concern says, hey, look, we're going to have to do something.
And he's favorable to it.
He says his concern still falls back to the Bush thing because it hasn't been properly explained.
This is a massive tax cut for people, and you've got to figure out how to pay for it.
But the buried lead that people really haven't picked up on, he says it in context of Bush losing the election and how it would hurt President Trump politically on his own side.
unidentified
Politically?
steve bannon ▲ ● ▼
I thought he was termed out.
Not in his mind.
His answer on the taxes relates directly.
This is easy to overcome.
Very easy to overcome.
But it's in response to his running again in 2028.
I don't think it's a random occurrence because President Trump doesn't do things randomly.
That you launched the merch yesterday of Trump 2028 on his official merchandising store and tees and ball caps and other things, other swag.
At the same time, knew that the time interview would be out today.
And in that answer, anybody that's been involved in politics at all says, hey, this guy's thinking through his re-elect and seeing if this would hurt him or help him.
Just saying.
Trump 28, 2028, it's happening.
It's happening.
And you can tell he's into it.
He would never have answered that question the way he answered about taxes, which makes me feel good because on the tax side, the math just doesn't work.
If the Pentagon, back to President Trump's hemispheric defense, the Pentagon and Pete and you guys need to shift your budget to the hemispheric defense because it's still a budget that looks at the Eurasian landmass that's something the United States has to defend.
Not so sure about that.
I think that's an open question.
Obviously, the South China Sea and around Korea and Japan, a little different.
But I'm talking about in the Middle East and in NATO and in places like Ukraine.
Complete, total, new rethink.
This interview is amazing.
We're going to talk more about it today throughout the day and break it down.
I want everybody to read it.
Really, in this interview, There's another, Matt Gaetz, and I gotta give a hat tip to Matt.
This is why, you know, think about what Matt Gaetz could have been if he'd stuck it out for AG.
The whole Seacott deal, the brainchild of Matt Gaetz.
That's what a brilliant young man he is.
Incredible guy.
You read the Seacott section of this, it's just absolutely incredible.
How Matt Gaetz is always a guy thinking downrange.
Thinking downrange.
And the CCAT thing is absolutely brilliant.
That would be the prison down in El Salvador with these terrorist murderers, rapists, criminals that President Trump as commander-in-chief sent down.
unidentified
Okay.
steve bannon ▲ ● ▼
Short commercial break.
Johnny Connors is going to take us out.
We're absolutely packed today, all throughout the day, here in Kansas City at the Hillsdale Conference, Leadership Conference.
Very proud of that.
And we're going to have someone who's speaking.
David Malpass, who is head of the World Bank under President Trump, is going to join us here in a moment.
unidentified
Here's your host, Stephen K. Vance.
Okay, welcome back.
steve bannon ▲ ● ▼
A little bit of an international incident.
By the way, David Malpass joins me right here.
David Malpass was Undersecretary at Treasury of International Finance in President Trump, early part of the term, and then later became head of the World Bank, appointed by President Trump, correct?
unidentified
That's right.
steve bannon ▲ ● ▼
David Malpass, old friend, one of the best guys in international finance.
We're going to get it up here in a minute in the interview by Eric Corosella for Time magazine, the cover of President Trump's first 100 days.
It's quite controversial because they get into it about China and President Trump says, hey, look, I'm doing all these deals.
We got them stacked up and we're engaged with China.
Andrew Ross Sorkin has just been on Squawk saying – the Chinese are saying, hey, there's no talks.
We don't know what this guy is talking about and he's got to stop sowing international confusion.
When I talk about – in the talk last night about the Chinese and they have gamed the system on the world trade.
And being the most favored nation, the cyber deal that in 2015 that Obama cut, they never fulfilled.
In 2019, or in 2017, then the whole 2019 Hong Kong situation, then you guys, you, Navarro, and Lighthizer's the tip of the spear, spent two years working on really a major deal that would solve everything,
the seven deadly sins, for two years.
And at the end of the day, in May of 2019...
They just kind of walked away from it, right?
Neither fare thee well.
unidentified
That's right.
And, you know, in the campaign in 2016, this was a major issue.
So it was no surprise when it started in 2017.
It kind of launched for me at Treasury, working for Mnuchin and for Trump.
And then as it broadened, then Lighthizer and Navarro were heavily involved, and it became also Wilbur Ross at Commerce.
The Section 301 trade was the clincher because...
China negotiated moment by moment.
So this idea of them saying Trump is sowing confusion is part of their negotiations.
They're really hard negotiators.
So it's got to be Trump up against them knowing this is exactly how people do it.
They say, you say, we're talking because we're trying to get toward a deal.
And they say, we're not even talking.
Well, that's a negotiation right there.
steve bannon ▲ ● ▼
Go back in that time.
It wasn't a surprise, particularly when it came to the campaign.
It wasn't just the southern border.
For those northern states, it was about the manufacturing jobs.
This has always been part of his not just populism but his economic nationalism –
I tell people, we go to these rallies, and what would take me an hour to explain to guys at Goldman Sachs, because they say, no, we're just investing there.
I said, it's a two-liner in Akron, Ohio, how they've shipped all the jobs, and these guys get it.
So immediately, we had Sheik.
We started those negotiations very, very, very soon after kind of a speed bump was hit in June of 2017.
Then you guys got fully engaged in it.
But the Chinese spent two years with you guys.
Two years in a very, very detailed...
Comprehensive.
This would couple the two economies and integrate China with all kind of environmental rules and labor rules and about state-owned industries and the deflationary pricing they send around because of excess capacity.
And Li He was the lead negotiator.
And after two years, they literally just walked away from it.
unidentified
I think that's part of the problem.
If you go slow and you're talking about hundreds of pages and then all of a sudden it's thousands of pages and no one actually or, you know, you question whether they actually intend to do it.
That was actually part of the NAFTA problem, that it started as the idea of benefits and then all of a sudden it became the lawyers and it became huge.
So by 1992 I had gone to the White House to say this has to stop.
We're not getting what we want out of this deal.
There are too many lawyers.
steve bannon ▲ ● ▼
It was a 92 for NAFTA.
Oh, the original NAFTA.
unidentified
Remember George H. W.?
steve bannon ▲ ● ▼
Yes, yes.
unidentified
Let the negotiations get really big.
And so I think we have to look at it in a different way now, that the system is broken, and there has to be a way that people can understand what's being fixed.
You know, I was a Tea Partier.
In 2010, people across the country knew that there was a giant problem.
That didn't get the job done.
It wasn't until 2016, as Trump was coming in, that you could have some light at the end of the tunnel of what was going to be done.
But even now, we're facing people, you know, across the government, people are trying to have a resistance to the change that's needed.
It's still the global order is dominant.
The elites are dominant.
And that's what you're talking about in 2018, 2019.
It just wasn't working.
And China knows what it's doing.
It's delaying and delaying.
steve bannon ▲ ● ▼
Okay, hang on.
You're one of the best experts in the world in international finance, and certainly in the MAGA movement and in the Trump circles, you're in the top handful.
When I gave this talk at the Summer for World Economic Summit in D.C. now, they're trying to make that like the Davos of D.C., had all these international financiers, and we talked about Trump's reordering of the commercial aspects of a get-off mercantilist system,
so let's get back to at least a fair trade system.
And I said, when people talk to me about this, I said, oh, so can't happen.
I said, give me – the plan we have now is not sustainable.
Do you agree with that?
I mean, the plan we have of spending $7 trillion, of raising taxes of $4.5 or $5, of having $2 trillion a year in deficits that Scott Besant has to finance, that's running out of control.
Interest is over almost $1.5 trillion.
The raw interest, we pay $1.4 trillion.
This system is not sustainable for us as a business model.
You agree with that?
unidentified
Absolutely right.
And the world sees that small businesses across the U.S. know that it's absolutely not working.
The bigger companies get the capital, and they snarf up the innovation.
And so there's a lack of dynamism even in the U.S., but I've got to tell you, it's worse in other parts of the world.
steve bannon ▲ ● ▼
Of course, there's less dynamism.
unidentified
Less dynamism.
I'm an IMF fan.
You know, I've written all about remove the shackles of the IMF from the poor countries where they run austerity programs.
But they put out their numbers this week.
There's this big shindig in Washington, you know, people from all over the world coming in to see how much money they can make from the system.
Is that what it is?
steve bannon ▲ ● ▼
Because we picked up Besson's speech live when he was reading the Rite Act.
Why is that IMF World Bank kind of joint meeting or whatever, why is it so big?
unidentified
It's because it's the annual meetings, but the money is flowing constantly from it.
So Besson's trying to stand up in front of a hurricane of spending and say, hey, we've got to try to downsize and think about your mission.
But what's going on under the surface across Washington is how do we get more money out of taxpayers and out of the system?
They want the appropriations from the U.S. to continue.
They want new capital increases.
And above all, they're doing credit guarantees across the board.
And so it's, in effect, nationalizing the losses, particularly of China.
So China's lent all this money, never takes a loss.
And it gets, in the end, guaranteed by the international system.
steve bannon ▲ ● ▼
The one belt, one road, the predatory capitalism, kind of what we call the British East India Company in reverse.
All the predatory loans that they're making.
You're telling me that the IMF and other institutions supported by American taxpayers basically give them loan guarantees?
unidentified
Yeah.
So look what happened in Argentina.
Here's this bailout.
The first one paid off is all of China's loans to Argentina.
But that's going on as a system.
Meaning in Zambia, China gets the mine, plus it gets all its loans repaid with interest.
And so it's been very profitable for China.
steve bannon ▲ ● ▼
And the project itself or the Zambian government can't do it.
So the loan guarantee is essentially U.S. taxpayers doing it?
unidentified
Correct.
And now what they're doing is in order to get China...
China away.
They pay them off with loan guarantees.
And so that, in effect, internationalizes or multilateralizes the debt system.
So China looks at the whole world system and says this is a great global order.
We've got to protect it.
They do that in the G20 where they're a dominant player.
One thing I'm hoping is that the U.S. ends the G20 after next year hosting it.
I think we should end it.
It doesn't work because it, like the WTO, the World Trade Organization, is a consensus process where you're expecting all, you've diluted, fully diluted the U.S. stature and status by saying we're going to have one vote,
each country has a vote.
And in the G20, that means China and Russia and Argentina and South Africa have equal, and Brazil have equal votes to the U.S., which...
It doesn't work at all as a global system.
steve bannon ▲ ● ▼
So where do you think we stand now in the reordering of this so that it works for not just the country of America, but American?
American citizens.
Where do you think we stand in this whole negotiation, the reordering to an order that works for us?
unidentified
Here's the challenge, and you named it.
The amount of debt and the unsustainability of the U.S. government spending is really hard to stop.
So you've got, I call it an upheaval, and that's what I wrote for Trump in September of 2016.
That we need to recognize the positive side of having a full upheaval.
That means of the Federal Reserve, of the trade system, of course, but downsizing each part of the U.S. government, whether it's the education or the housing or the EPA and its overreach of regulations.
So that's all ongoing.
But as you can see, the resist movement.
You mean the Washington Consensus Institutional Resist Movement?
steve bannon ▲ ● ▼
Because the top 19 families just got a trillion dollars of wealth in the last year?
unidentified
They benefit, and they use litigation, and Washington right now today is getting rich on the fight that's going on to try to downsize.
Some people say, well, you can make a lot of money by upsizing.
Like all the public money that's going to universities, you make huge amounts.
Washington is the lobbyist that gets the appropriation.
But then you make just as much money trying to resist it on the downside.
steve bannon ▲ ● ▼
Hang on one second.
unidentified
You're stuck with us.
steve bannon ▲ ● ▼
David Malkus.
Former head of the World Bank and undersecretary of international finance in the first Trump term.
Take your phone out.
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Short commercial break.
Back to Kansas City, Missouri.
Just a moment.
unidentified
Oh, oh, oh, it's true.
Northern Day, only one.
andrew ross sorkin ▲ ● ▼
The embassy just said they are not having any talks on tariffs and that the U.S. should stop creating confusion.
Now, just a bit of a reminder, this Time magazine piece came out literally at 6 a.m. this morning.
It was an interview with President Trump.
That interview, though, took place apparently on Tuesday.
So here we are on Friday.
It's been a roller coaster of a week and so many different things have been said, both by the president and his Treasury Secretary, Scott Besson.
Okay, that's Andrew Rorserkin.
steve bannon ▲ ● ▼
You know him very well.
Squawk Box.
Here's the international incident that has come up.
President Trump gave the Time magazine interview Tuesday.
It's all over.
It came out today, this morning at 6 a.m.
He says in there they're having conversations, and I think he says Xi picked up the phone and called him.
And the Chinese are out, and you've negotiated with him.
They're coming out and saying there's no talks.
We're not talking to Besant.
We're not talking to Trump.
We're not talking to anybody.
And the foreign devils are trying to sow confusion.
Your thoughts?
unidentified
Confusion and uncertainty is part of the system.
And to get to an answer, you have to kind of break the system that we're in, which is that people talk quietly to each other and get nothing done.
And so Trump's doing it publicly and saying, we're going to get this done with deadlines.
And so the question to me is, if you've got the trading system broken, what can you get out of it country by country?
And I think that's what's going on on the table right now.
They're supposed to come forward with proposals to get out of the To get back into the US market.
steve bannon ▲ ● ▼
You've done this before.
This is Tuesdays, the day President Trump gave the interview.
We've referred this a number of times.
The Financial Times from the other day, as you know, have held this up.
Beijing warns of retaliation against nations doing US deals.
Are going to have embedded in there that we're kind of your lead trading partner and, you know, you'll make special accommodations with us and we'll make special accommodations with you.
Beijing has let, no, particularly the East Asian countries in India, Japan, Korea, Taiwan, Philippines, Vietnam, and India, you know, no bueno, right?
So your thoughts?
unidentified
Beijing has lots of influence in countries, you know, ambassadors that are fully inserted into the countries.
The mainstream media really likes that because they can play up the China side of it, and it's very anti-Trump in its nature.
But what's happening kind of in the bureaucracy of the world is they're trying to Trump-proof.
steve bannon ▲ ● ▼
What do you mean Trump-proof?
We see how the Democrats try to do it.
We see how they're trying to do it here.
unidentified
Across the world.
You move the money from where it can be clawed back by the U.S. to where it can't be clawed back by the U.S. Walk us through that.
steve bannon ▲ ● ▼
So these guys, when they see Trump coming to power, let's make sure we're beyond Trump's reach as far as sanctions go and as far as the SWIFT system.
unidentified
That's right.
And, you know, the Biden people knew exactly how to do that.
They'd done that in the Obama.
It was the same people doing the same thing, which is you set up trust funds, move the money into the trust fund.
And write the governance rules of the trust fund so that the U.S. can't get the money, so that Trump can't get the money back.
But that's going on even now.
You know, WHO was out.
Did you see them saying they're downsizing?
And then you read the fine print.
It says from 76 departments to 34 departments.
So here you've got this organization in Geneva, very high-priced part of the world.
steve bannon ▲ ● ▼
That we've pulled out of, and not for a year, and the CCP essentially runs.
unidentified
But they already took all the U.S. money, and so they've got some in the bank, and then they're saying, well, we're going to downsize and eat by, and China will step up and keep it going.
And so that's going on in the United Nations, a huge problem.
You know, the organizations have spread across the whole world, and they're deeply embedded.
And so in order to do the work to right-size, to downsize and make it in the U.S. national interest, is going to...
It's going to be really hard.
The point I was making, or that we were just doing, is on trade, the customs line items, and China's going to play this game.
They're going through the types of products, and they match it up with districts in the U.S. They advertise that they're chopping off a given congressman, and then they come back and tell them exactly what happened to them.
Your favorite donors just got...
That's screwed.
And so it will be, you know, full out battle.
steve bannon ▲ ● ▼
It's micro-targeting economic warfare.
unidentified
That's right.
And they're masters.
They've got big data.
They know how to do it.
And they went through it in 2017.
So one problem is they're going to be even harsher.
This is against the background of their predatory industrial policy.
So, you know, this is not a small problem for economics.
How do you run a world when the second biggest economy has a super predatory industrial policy where their goal is to produce every product and drive you out of the market through economy of scale?
steve bannon ▲ ● ▼
Let's go through that for a second.
When you mean predatory industrial policy, because the Germans, some of the guys that were big talk understand now, like in the middle, was it the middle, those middle companies that were the pride and joy of precision tooling of Germany, now the Germans understand what the industrial policy of China really is.
unidentified
That's right.
Now that FT article, you know, one big problem is Europe is going to be divided.
steve bannon ▲ ● ▼
Well, the EU said last night when I walked on the stage, right for the stage, they put out a statement that said, hey, if you want us to be part of this, to decouple from China, it's not going to happen.
unidentified
I remember the weak knees.
So I remember one, Macron, it was in the same spot in the same newspaper in 2019 when he'd gone to China thinking he was going to get a deal, came back, said, I didn't really get a deal, so I'm mad at China.
It was a big headline across Europe.
And then they backed off completely because they can't, they're not in a position to decouple.
But to your German point...
steve bannon ▲ ● ▼
France is not.
unidentified
France is not.
Well, and Germany is, you know, what they've been doing because their energy prices are so high because, I mean, think how many huge mistakes they made.
They became dependent on Soviet, on Russian oil, first Soviet oil and then Russian gas, and they closed their nuclear power plants.
So their energy costs go sky high.
steve bannon ▲ ● ▼
They try to decarbonize.
As an industrial power, they essentially deindustrialize by buying into the cult of decarbonization.
unidentified
And so, exactly.
Where did they go?
They went to China because they burn coal.
They import it from Australia, burn coal to make the electricity, and they make the chemicals for the world.
It's a market that Germany used to have.
So as Germany looks at it now, what's happened on intellectual property is China systematically looked at the smaller businesses that they needed from Germany, the ones that make machine tools, for example, figured out how they could copy that in China,
take the IP, and then do it in China.
Then they undercut the market.
So Germany's now standing really harmed by this, and it's going to take work.
I think we've got years of battle to really flatten the – to really make a level playing field.
steve bannon ▲ ● ▼
And this is what I was trying to say last night.
Given the decades that our decision-makers have made horrible decisions, it's narrowed the range of alternatives that we have.
And we don't have any easy alternatives.
That's what I was trying to say last night.
The converging crises here are multiple crises.
And on none of them do we have easy alternatives.
And that's going to lead to a special group of, if you're hardened and you're tough, and the ability to make hard decisions and live by them, you'll get through this.
If you're not, you're going to lose the country.
unidentified
That's right.
But I think that means that we have to focus on the things that we have to have first.
And so that means decisions by the president on which industries can be brought back, and then which ones can stockpile and be prepared over the last.
steve bannon ▲ ● ▼
You're saying triage it now.
There's been a natural tendency to hate the concept of industrial policy in the United States, although we do have industrial policy by our tax structure, right, essentially.
Are you saying we have more of an industrial policy, that we have to think strategically about this?
unidentified
I think we have to match the world.
There's a little bit of reflexivity or reciprocity in that if they're doing it.
But Reagan, you know, I worked hard on this in the Reagan administration.
He made the distinction between industrial policy that would protect fat U.S. corporations, and I'll name two, well, I'll name one because one still exists, but Kodak, remember, was the biggest lobbyist.
Instead of inventing new cameras, they were lobbying in D.C. He said no, but he took on the Japanese on autos, and that really changed the industry.
So there was some decision-making, I mean, very important decision-making.
Same thing in the defense area.
The other name was Kodak.
steve bannon ▲ ● ▼
What about the defense industries?
One of the things I've been all over is that we just can't.
It's obscene to me to have the EU come out and make a statement that they can't consider decoupling and their deal is going to reflect that.
At the same time, we have two carrier battle groups at the mouth of the Red Sea.
One is for the Houthis and the whole Persian and Arabian and Israeli, but the other is to keep the Suez Canal open for trade to Europe.
And they've got...
A Royal Navy frigate, a French Corvette, and an Italian destroyer, and that's all they've given to the effort.
unidentified
They, you know, really depended on the U.S. Now, we should be very proud of being Americans, and everybody listening, I hope, will be proud of that because the U.S. has a strong economy, a strong military, and can do the job for itself.
We can protect ourselves, but what we have to do is get changes in Europe, obviously.
They're really...
And so that's got to be turned around.
On defense, though, we're in Kansas City right now.
I've met a lot of current military and ex-military people, and they are so proud of America, but no one voices support for a trillion-dollar defense budget.
steve bannon ▲ ● ▼
I'm a veteran to nobody.
Nobody.
Because we realize it's out of control.
unidentified
Yeah, we're out of control.
So then that gets to the choices.
steve bannon ▲ ● ▼
And these are patrons.
These are people that are the hardest core patrons.
unidentified
I want the Defense Department to make choices of do we need every kind of ship and do we have to make them?
Can't we use shipbuilding industry outside because we need them fast.
We need cheaper.
We don't need all these fanciest missiles.
We need to have electronics that talk to people and all of that.
steve bannon ▲ ● ▼
But the basic point, look, you were in Treasury International Finance, so this would come under your at least strategic overview.
Essentially what President Trump is saying in this hemispheric defense, and one of the reasons he got James Polk, as the Italian magazine tells us, up on one of the portraits on the wall, is that from Greenland to the Panama Canal, and obviously Brazil's got to be taking care of in Argentina, in Latin America, and South America,
but from Panama Canal to Greenland, it's a naval strategy.
You take the vast central Pacific, you do the three island chains of which Pete went to Hawaii, Guam, the Philippines in order.
That's the – you go from the Arctic, you're going to have to get involved in the Arctic, right, because it's a great power struggle.
But I think it's one of the reasons Canada could end up being like Ukraine with China taking a bite out of their territorial integrity up there.
You do that, you totally reset the military.
All of a sudden you're not worried that much about the Eurasian landmass and you have an expeditionary force of Marines and Army and Navy that can go anywhere if you have a hotspot.
Isn't that the way you have to realign?
The NDAA's got to be realigned with the basic new strategy, doesn't it?
unidentified
That's right.
That's right geopolitically, and that's maybe a brilliant strategy, and we can think Trump is thinking about it that way.
But here's the problem.
The Defense Department right now is, I think, still Trump-proofing itself.
So they figure out which contracts would be non-cancelable.
steve bannon ▲ ● ▼
Hey, we're going to keep you running.
David Malpass dropping truth bombs here.
Trump-proofing.
I love that thing about moving the money around, right?
Moving the money around is very, very, very important.
I'm going to ask you about the BRICS movement.
One of the things they're saying is we've used the dollar too much as a weapon, and that's why the Chinese are getting a hearing by the BRICS.
Besides the drop in purchasing power of the dollar, also it's been used as a weapon.
Short commercial break.
Birch Gold, go to the...
So for four years we've been doing this series, The End of the Dollar Empire.
Go to birchgold.com slash band in the sixth free installment.
Modern monetary theory, the idea that broke the world.
You've got to get up to speed on this.
Remember, if you understand how money works, if you understand how capital markets work, you will therefore start to have a whole new view of politics because it's all about money and power.
Short commercial break.
David Malpass.
One more episode.
One more slot for him.
Be back in a moment.
unidentified
Here's your host, Stephen K. Band.
steve bannon ▲ ● ▼
So let's have your other thoughts.
I want to get it on the table of, you know, the Trump-proofing, what the Pentagon's doing to Trump-proof, because we're very upset about the trillion dollars, and you're saying they're already thinking ahead of how they are resistant to the bacillus of the Trump movement,
a MAGA?
unidentified
You know, it's hard to get inside each of these agencies, but around the government, what they know and they're skilled at is the contracts.
So if you can lock in the contract in a way that it can't be undone, then you're money good.
And so in the Defense Department, one of the problems is the primary contractors are so dominant.
Five families.
steve bannon ▲ ● ▼
Only five?
unidentified
So you've got an oligopoly.
steve bannon ▲ ● ▼
It's like the five families of the mafia, right?
They run the deal.
unidentified
You said last night, oligarchs.
In that way, they can really crowd out anybody else.
And if they can get the contracts to them, then they can protect them.
So it just makes it hard for the changes to be made.
And the amounts of money that we're talking about are huge.
They're doing $10 billion, $20 billion on individual contracts.
And so they're moving as fast as they can.
In the Senate, think what's going on.
The resist movement is super...
Yeah, the Senate confirmation, the decision makers have to come in at the top and make decisions, and they slow walk them.
And Chuck Schumer is a master at how do you use up as much time as possible.
This is going to be an issue, coming back to the government spending, of how do you get enough resources?
You need recisions, but those are hard to do because they take floor time.
You need executive branch authority, which Trump is asserting, and I think that's going to be a real...
steve bannon ▲ ● ▼
You're saying impoundments?
unidentified
Impoundment has to be looked at.
You know, if you look at...
I was on the staff of the Senate Budget Committee, so I know a lot about this.
In 1974, Nixon was at his weak spot, and the Democrats put through the Budget Impoundment Act of 1974, which took away...
the president's power over spending,'cause they wanted themselves to be able to spend and get the campaign contributions.
How is it that members come to Washington with no money and then they go out rich?
We need more than that.
The checks and balances are not strong enough in the Constitution against the size of government.
In their wisdom, in the founding fathers, they protected free speech.
They protected religion.
They protected against illegal search and seizure of citizens.
And these were really powerful.
But they didn't realize they needed to be a good person.
We're now in a spot where Trump will really have to show new procedures.
because he'll be gone someday, and the Democrats will come back someday, and their whole idea is to have everybody work for the government.
That would be an ideal.
They would say, well, that would give us a lot of GDP growth,'cause it would be very stable.
We've got to get back to a small business system.
We can turn to Bricks if you want.
I've said my piece on that.
steve bannon ▲ ● ▼
And we want to do the Fed.
Let's do a couple of minutes on bricks and then let's do the Fed first.
We are big believers in ending the Fed.
What are your thoughts?
unidentified
We have a broken system like trade.
And how many mistakes can the Fed make on inflation, deflation?
And, you know, I've written over and over in the Wall Street Journal that they never look back and introspect.
Why did we make such a big mistake?
Well, it's because they have stupid models.
The models are what's called neo-Keynesian.
That means they have a concept of how people work and grow that's plain wrong.
That's the core Phillips curve model, but it's the fascination with CPI, which we can't even count.
I really don't think you get right numbers out of CPI, and yet they're using it to set interest rates.
They have this immense power to buy bonds, any kind of bonds.
Even in 2023, people don't know, in the heat of the campaign, as they were trying to Trump-proof Washington, Against Trump.
The Fed used his 13-3 authority in March of 2023 to allow the Fed to lend to banks as if the collateral, as if bonds were at 100 cents on the dollar when they were only worth 90. Well,
steve bannon ▲ ● ▼
because their own bonds were blowing holes in the balance sheets, as were the Silicon Valley Bank and other things, the bailouts.
unidentified
And don't forget, the Fed was the...
It's the world's biggest hedge fund with the world's biggest loss unrealized on its books.
So every year now, we are stuck, American taxpayers, with realizing $250 billion of losses from the Fed.
But that understates because underwater is all their entire—they have $7 trillion of a bond portfolio that's lost money.
And what's worse, as I say, in 2023, they allowed this— Freebie lending to banks that they were trying to protect.
Now, I do want to say the importance of a central bank anywhere in the world is to protect the currency of the people because otherwise devaluations kill People really cause in the developing world,
it actually causes starvation, poverty.
One of the things I fought at the World Bank was the IMF's tendency to have everybody devalue because it protects them and the elites in the country.
We've got to stop that.
steve bannon ▲ ● ▼
We're going to get you back on later in another time to do bricks and other things.
It's been fascinating.
How do people get to your writings?
Do you have social media, all that?
Where do people go?
unidentified
Understated on that.
steve bannon ▲ ● ▼
So hold it.
No website to put your writings up?
No social media?
unidentified
You know, I've tried and tried and tried.
In confidence.
steve bannon ▲ ● ▼
You're so old school.
So one more time, where do people go?
unidentified
Just Google me.
Wikipedia.
steve bannon ▲ ● ▼
And get all your writings.
David Malpass, former Undersecretary of Treasury for International Finance for President Trump and then head of the World Bank.
Fascinating discussion.
We'll get you back.
We're going to take you out with The Right Stuff, a book by Tom Wolfe, a classic, an amazing film, a really amazing film by Phil Kaufman, underappreciated at the time.
Of course, we love it.
And Academy Award-winning music by Bill Conti.
The Right Stuff will take you out.
We're going to be back in two minutes with the second hour of the morning edition of The War Room.
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