The Prof G Pod with Scott Galloway
00:30:26 · Fareed Zakaria
[00:30:26] S4: I think it'll require more than words. It'll require action. You know, you'll have to commit to certain longer term policies where The United States is willing to return and to and to kind of join with these countries in in various ways, you know. So with Canada, you've you've got to once and for all sort out this trade thing and say, look, We basically have a great deal here. We have an integrated North Atlantic economy, and we're going to move forward. We're gonna lock it in in some way, you know, whether it's a long fifteen year trade agreement. And the most important thing would be to work with Republicans who, hopefully, once the Trump spell is broken, who agree with you. I mean, the... NAFTA was a Republican idea. It was George Bush senior's idea. It passed with a majority of Republican votes, not Democratic votes. It was Bill Clinton plus the Republicans in the house who... And senate who passed NAFTA. Similarly with India, I think you'll have to you'll have to think about some long term economic technological partnerships, which, by the way, as you you point out, would be incredibly beneficial and win win. Take one example. So The US has been trying to wean itself off the mass excessive dependence on China for a variety of things, and one of them was Apple. The idea was Apple was producing too much of its production in China. And so the the Americans went to to India and said, can you can you help produce the iPhone? And they hooked up with Tata's, which is one of the best companies in India. Three years ago, zero iPhones were made in in in India. Today, every new iPhone in America is made in India. 25% of all smartphones are made in India. This is essentially from almost a zero standing stock.
00:32:21 · Scott Galloway, Fareed Zakaria
[00:32:21] S3: Every new iPhone is made in India? [00:32:23] S4: Every new iPhone that sells in America. [00:32:26] S3: The new models. [00:32:27] S4: The new models, exactly. [00:32:29] S3: I did not know that. [00:32:30] S4: And this is in three years. And the reason is only India has the scale that you could, you know, that can offset China. If you really want to de risk yourself from an excessive reliance on China, whether it's with railroads, whether it's with, you know, ilium, whatever it is you're looking for, this... You're gonna have to do it in a... With many other countries, you know, Mexico, Vietnam, Malaysia. But India has the scale that allows you to do stuff like I just described. Nobody else could have, you know, gotten to the point where 25% of all smartphones sold in The United States are now made in India in three years. Right? Because it's 1,400,000,000 people and a large number of technically trained people. So... But you need to do things like that. You know, we have this deal with the Australians, AUKUS, to get... To sell them three submarines. They are all convinced that Trump is essentially delaying that process and that they'll never get their submarines. So they'll have pissed off the Chinese and gotten nothing for it in return. We've gotta make good on our our commitments there. You know? So I think a lot of places in the world would be amenable to this idea that America has returned, but it will take actions, not words.
00:33:48 · Scott Galloway
[00:33:48] S3: We'll be right back. We're back with more from Fareed Zakaria. So let's brainstorm around what's something that would show real metal. I think the economic agreements and tariffs take months, if not years, to construct. And quite frankly, aren't that sexy or exciting. They're really important, but a new agreement on auto parts between Canada and The US that restores us to where it was before or NAFTA three. Yeah, it's important, but from a retail standpoint, it doesn't get people excited or send much of a message around the world. What would? What if the Democrat's in office, what if they immediately passed a resolution saying, if Europe is spending, supporting Ukraine to the tune of $120,000,000,000 a year, I don't know the number, we're in for 200. We're gonna give them our latest technology. We are going to ask Europe to even step up more as we are in a profound way, and we will not stop. We have the largest balance sheet in the history of the world. We have the most sophisticated weaponry. We have the best intelligence service. We are gonna we are gonna rally all of that until Putin leaves Ukraine. And let Trump veto it. Let him explain why he is not supporting an ally. But start to set the table. To me, there's fewer rallying points that would show America is is back, if you will, with all caps? Your thoughts.
00:35:33 · Fareed Zakaria
[00:35:33] S4: Yeah. I think that's a great idea. And I think I agree with both your points. First, Ukraine is the most important struggle. If you believe in this international order we've been talking about, that The US largely built after 1945 with Europe's help, the biggest norm that was that was enshrined in it was you cannot conquer territory by force and just an exit. Something that was routine in the hundred years before 1945. I mean, Alsace Lorraine change... Changed his hands four times between the French and Germans in the hundred years before 1945. Since 1945, there have been virtually no brutal annexations of that kind. It's a it's a norm that has largely held up. And so the Russian violation of it and and and against a liberal democracy struggling to be not just to survive, but to be part of the West is the big political moral struggle of our age. And Trump has basically abandoned the Ukrainians. So to to to push back against that, I think you're exactly right. Secondly, it would be very militarily smart because what... Trump is right. We need peace there. Elon Musk is right. We need peace there. People are are dying on both sides. But the path to peace is to pressure the Ukrainians rather than the Russians, to to pressure the victim rather than the aggressor. It's it's politically stupid. It's morally obtuse. So this would get us back on that track. Now the second thing you said, I think, is also important, which is some of this isn't gonna happen. But the Democrats have to start laying out what is the world we believe in, what is the world we... You know, our... What is our vision for the world? And if they can do that through a series of big votes, they should make clear these are the things we would like to see. You know, a big thing on health care, a big thing on Ukraine, you know, a big thing on... The tariffs, I think there's an easy way to to do it because the treasury is at this point addicted to the tariffs, so you can't really get back to... You can't go back to where you were. But what Trump has done is I I think I read somewhere that there are actually 7,000 tariffs... Tariff rates when you add them all up. Because Trump never... You know, it's never actually a 18% rate for some country. There are huge numbers of exemptions and exceptions. Some of them for legitimate reasons. Some of them, frankly, seem to me all about corruption.
00:38:02 · Fareed Zakaria
You know, you're kind of various industries and and and firms are buying exemptions. So you you regularize that. Say, we're gonna have a 5% tariff, you know, toward all imported goods, a kind of consumption tax on imports of about 5%, 7%. It's not particularly high. You know, the economy can handle it fine. The markets will handle it fine. But you've got it... And and the... And you say to the American people, you're doing this because we wanna lower the tariffs substantially so that you get relief so that, you know, price... The the prices that you are dealing with are lower. Dem... The... It's hard for the... Let's be honest. It's hard for the party out of power that doesn't have the White House to to be represented and to have a coherent vision. Because the reality is you're going to have a wild entrepreneurial free for all with probably 15 to 20 candidates running to replace Donald Trump, particularly if his approval rate... Ratings remain as low as they are. Remember, Scott, he is now basically the most unpopular president in American history. I mean, his only competition is Richard Nixon in the six month period around his resignation. But to be in the 36, 37%, you're pretty much as low as it gets. That is going to invite a huge number of Democrats to run. So the danger is you end up with cacophony, and Hakeem Jeffries and Schumer can provide that coherent message by coming up with four or five totemic things. You pass big bills. You make it you make it a big deal. And as you say, let Trump veto it.
00:39:39 · Scott Galloway
[00:39:39] S3: I wanna propose a scenario and have you respond to it. It's it's the thirties. We're contemplating reentering Europe, paid a huge price from World War one. It's a very unpopular idea to go back where it feels like we just left. And this innovator, Charles Lindbergh, is saying, no, we should partner with the Germans. Imagine if you will, that Charles Lindbergh was able to raise a ton of money and buy McDonnell Douglas, an aircraft manufacturer, and put in place this unbelievably innovative guidance system. And FDR decided to loan to the RAF B-17s, an amazing bomber in defense of Europe as this fascist begins to invade Europe. And then the CEO of McDonnell Douglas decides mid flight to turn off the guidance systems. And as a result, the blitzkrieg increases in fury and UK citizens are killed. I believe that has almost exactly played out in the last few weeks with Elon Musk throttling back Starlink. And my question is, or my thesis is, we took the Rosenbergs and put them up against a wall and executed them for being traitors. And I realize this is an incendiary statement, but I'll make it and I believe it. I think Elon Musk is a traitor to the West. And I think what is even more dangerous is this zeitgeist within America that the idolatry of innovators and money has created a cloud cover such that traders to the West are not seen as traders to the West. That if it... This had happened in any other age where we were not obsessed with innovators and money, a much different reaction would be playing out to Elon Musk. Your thoughts on Elon Musk's actions, America's response, and if you're willing to speculate what might happen if the Democrats take control of Congress. A lot there. I apologize for the word salad.