Invest Like the Best with Patrick O'Shaughnessy
· Patrick O'Shaughnessy, Darren Farber
[00:00:00] S0: So who is more right do you think between Eisenhower and Taylor? Apply those two lenses to today's stance for the US. What is the US doing, not just in the Iranian theater, but in general with its military, with the Department of War? What are they doing? What should they be doing that they're not doing? What are they doing that they shouldn't be doing? [00:00:00] S1: It's fair to say you need both. If you took an exclusive maximalist view of Eisenhower, of having this nuclear deterrent, your only response is nuclear deterrence. Can you imagine the world we'd be living in? Some people would say, "Well, great, that would mean we wouldn't get involved in any of these contingencies. We wouldn't have gotten involved in Vietnam, we wouldn't have gotten involved in Iraq, probably wouldn't have gotten involved in Afghanistan. Because we wouldn't have this flexible projection of force to correspondingly respond, and maybe we wouldn't have the temperament to drop a bomb on someone." Maybe we would, but the binary choice would be so stark. Flexible power has all these gradations of capability that Taylor outlined and that have been modernized for the new concepts of warfare, and that's how we build magazine depth in all of these things. A Tomahawk missile is not a nuclear weapon. HIMARS is not a nuclear weapon. It's the concept of being able to enforce the smaller infringements, if you will. You probably need both. It would be a very scary world if all we had was a nuclear button in order to prevent a full-scale contingency.
· Darren Farber, Patrick O'Shaughnessy
[00:00:00] S1: It's fair to say you need both. If you took an exclusive maximalist view of Eisenhower, of having this nuclear deterrent, your only response is nuclear deterrence. Can you imagine the world we'd be living in? Some people would say, "Well, great, that would mean we wouldn't get involved in any of these contingencies. We wouldn't have gotten involved in Vietnam, we wouldn't have gotten involved in Iraq, probably wouldn't have gotten involved in Afghanistan. Because we wouldn't have this flexible projection of force to correspondingly respond, and maybe we wouldn't have the temperament to drop a bomb on someone." Maybe we would, but the binary choice would be so stark. Flexible power has all these gradations of capability that Taylor outlined and that have been modernized for the new concepts of warfare, and that's how we build magazine depth in all of these things. A Tomahawk missile is not a nuclear weapon. HIMARS is not a nuclear weapon. It's the concept of being able to enforce the smaller infringements, if you will. You probably need both. It would be a very scary world if all we had was a nuclear button in order to prevent a full-scale contingency. [00:00:00] S0: How would you compare the state of our military capability and prowess today to when you were in the Pentagon?
· Patrick O'Shaughnessy, Darren Farber
[00:00:00] S0: How would you compare the state of our military capability and prowess today to when you were in the Pentagon? [00:00:00] S1: We're the best, man. Someone asked me earlier today — they said, "What's the grade that you'd give it?" I said, "It's not fair to do this huge compound grade because, one, this is a government organ, so how great can a government organ be?" But our ability to train and equip the forces and what they deliver — it's the best fighting force in the world that the world has ever known. You have to do some relative comparison to the rest of the militaries around the world. We are number one, but it is a body of government, and because it's a body of government, it gets one-year money from Congress. You have deck chairs that constantly change. You have these features of government that make it suboptimal. But as a grade, as a military and its capability, I give it a super high grade. Is the bureaucracy a problem? Yes. Do we have to modernize it? Yes. Do we go through it every 20 years? Yes, because we recognize how important it is. Our ability to project force is so good. I think having a pacing threat unto itself is valuable to make sure that we are serious about maintaining capabilities. I love the works of Dikötter because he's so clear about how strong and weak China is at the same time. [00:00:00] S0: Who's Dikötter?
· Darren Farber
[00:00:00] S1: Dikötter is a well-regarded historian on China, and has a theory on how China is not a superpower just by virtue of how illegitimate and how weak it is, and how tense the plenary in the party is. He has good points. The Chinese equivalent of the Chairman of the Joint Chiefs of Staff has disappeared. He went to kindergarten with Xi Jinping. These guys are close. When you have power and you ascend power in a fundamentally illegitimate structure, who do you trust? The answer is no one. You're constantly worried that someone's going to put a bullet in the back of your head, and then that form of illegitimacy cascades down through the immediate organs of that government to include its military. We've talked about their lack of jointness, the corruption internally within the force, the corruption in the missileer crew. They have turned over their senior military leadership three or four times in the last three years. That is not a high-trust environment. High trust comes through esprit de corps and believing in the mission and legitimacy of what you're doing. That is one of our enormous strengths. But their magazine depth industrially is so enormous, so the calculus becomes — can the magazine depth overcome their institutional weakness? It's a good question, and that's why we as a country are embarking on this enormous effort to industrialize, in order to add magazine depth to the capabilities we have. You wouldn't add magazine depth if you had the maximalist view of nuclear deterrent. You have magazine depth when you believe in the concept of flexible power.
· Patrick O'Shaughnessy
[00:00:00] S0: I talked to Shyam from Palantir about this. He had just come out with his book — I think it was called Mobilize — about this exact thing of increasing magazine depth. I don't think he used those words, but it's what he meant. How would you grade us on that specific thing? What is the state of it today? Are we doing a good job? Who is doing it? How's that going to unfold?
· Darren Farber, Patrick O'Shaughnessy
[00:00:00] S1: We're in a democracy. In a dictatorship, if you don't build magazine depth, and that's your job, you're dead. That mechanism of enforcement is pretty compelling. Here, we balance things like — will it be profitable, will it have duration, and Congress is giving one-year money. There are new efforts to create multi-year contracts for ordnance, which we've never done before. We really need it. We're changing the architecture to allow us to do more to add the magazine depth. We need to go faster for the purposes of filling the deterrence gap, so we can stop small incursions on the margins, especially with the Southeast Asian nations that we have cooperative peacekeeping agreements with — these bilateral agreements where we have to protect them, and they're being violated right now, like the Philippines, for example. So we have to do more there. It's getting better, and compared to anyone else in the West, we're still the best. It's just your adversary has a political structure that allows them to bring people to the precipice. But the illegitimacy of the Chinese — fundamentally an illegitimate power — is also our advantage, and we are making enormous strides in the clandestine services of co-opting that environment. [00:00:00] S0: Say more about that.