Ep 137: Gov. Chris Sununu on AI vs Harvard, DOGE 2.0, and a Balanced Budget Amendment to the Constitution

0:00I spoke at Harvard. All these students are like, well, what do you think about AI and how we're not going to have as many jobs. I said, no, you're not going to have as many jobs. The plumbers and the welders are going to be the millionaires. So I would recommend you start welding. You're an MIT graduate and engineer. How do you go on to do that, then win four terms as governor? Politics and government needs more engineers. I love what Doge was doing. Elon was so right in what he was doing, but they should have surrounded him with better methods and messaging. You're also a national chair and board member of balanced budget now.

0:26We're going to call a convention and put in an amendment. Very specifically written that it's just to enforce a balanced budget. They're managing trillions of dollars. It's not their money. It's your money.

0:42I'm a huge fan of Governor Chris Sununu. He was back-to-back governor in New Hampshire four times. He was an engineer by background from MIT. Pretty rare to have a great governor who has an engineering background. And now he's leading the charge as chair of Balanced Budget Now, which is a group that's going to get the amendment for the balanced budget for the United States of America over the line. We already have 27 states. Looks like 31 now are lined up with who's likely to do it. We just need to get to 34 states and we can get a balanced budget amendment. It's likely as we get close, it'll push Congress to take action.

1:13This will fix a lot of problems for our country. Excited for you to hear from one of our great leaders, Governor Chris Sununu. Welcome to American Optimist. Honored to have our friend Governor Chris Sununu here with us today. Mr. Governor, you're an MIT graduate and engineer. It's pretty rare for governors. How do you go on to do that, then win four terms as governor? Well, let me first start by saying that politics and government needs more engineers, without a doubt. This is where, can we bash on lawyers? You might have a lot of lawyers listening, but it's always fun to be a bit of a cynic about the lawyers because there's a lot of them.

1:42But it is about problem solving, right? It's about system design. So I never wanted to really, my dad was in politics, my brother was in politics. I never thought about getting in politics because it's very public. It's not great for the family. You know, usually your family wants to stay behind the scenes and especially in this world, politics, they want to push you forward. But in some ways, very selfishly, my son was in the fourth grade and Common Core was flying hard in mathematics in our public schools. And I went, this isn't right. This is weird. I was running my own business. I was an engineer for a long time.

2:13I later ran a ski resort. I won't bore folks with how that bizarrely happened. But I'm running my own business and it was tough. And I saw all the regulations coming down in the live free or die state of New Hampshire where we shouldn't have a lot of regulation. So very selfishly, I said, well, I want to make it better. And in New Hampshire, unlike most any other state, you really can just kind of step up and run. We have a super unique system in New Hampshire. It's a live for your day state. For example, we have 400 members of our House of Representatives. Oh, that's right. So many because it's tied to the number of people.

2:43That's right. It's really tried to population and they get paid 100 bucks a year. So we kind of hold true to the founding father's ideal of volunteer government. No one should stay too long. We don't have term limits, but everyone has to get elected every two years. I was the only governor other than Vermont to have to get elected every two years. That's a little annoying. It's annoying for the governor, but it's great for the people, right? If you're not doing a good job, you get fired. That's kind of like a good thing. And we don't have enough of that, I think, out of D.C. So I just I really wanted to kind of put it more of an engineering, less politic mindset onto some of these problems.

3:14We had a wicked opioid crisis in New Hampshire, and I had some ideas on how to whiteboard it, right? Not just keep pumping more money into it. That's the biggest problem we have in America. We have an old system, an old design, and they say, well, you know, to make it better, we just need to put more money there. But putting more money into something pushes harder. But if you're going in the wrong direction, you're pushing harder in the wrong direction. No, a lot of money is not necessarily going to solve the problems. I love that you say wicked. I have a lot of family from New England as well.

3:39It's wicked awesome. Being governor was wicked awesome. I kind of curved it now that I'm down in Texas. For all listening, it was fantastic. It was fantastic. It was really, really fantastic stuff. You have a very bipartisan legislature there, so you had to persuade Democrats to join you in reigning in the budget, expanding school choice. How do you work with them on these things? Yeah, so the heart of New Hampshire, the biggest difference is that it's locally controlled. So I don't have sales tax. I don't have income tax. We don't have inheritance tax or any of that stuff. We do have a property tax.

4:10And the reason this is important is that that means not the governor or the legislature, but you as a citizen show up every year at your town meeting or at your city council, and you decide exactly how all your personal taxes are spent. So what does that mean? People get very involved. People are very educated. It's really why we have the first in the nation primary. This leads to a lot of people getting involved. And what that means is we look at the candidate. We look at what's really behind the candidate. We don't just vote on party lines. so that local control thing makes us a very purplish independent-minded state right now there's maybe 32 percent republicans 28 29 percent democrats everyone else is undeclared and they can participate on either side of the aisle and they do because we have the highest voter turnout in the country so that's why naturally we do have ebbs and flows i think right now our entire federal delegation is democrat but the entire state house is run by republicans and they were all elected on the same ballot effectively so we jump ticket a lot and because we really as as citizens in new hampshire so that is the inherent whoever becomes governor you got to be willing to work across the aisle and there's there's one real simple way to do it i could go into a lot but give a little to get a lot so i got tax cuts done i got school choice done i got all these things that mostly democrats would always say no to but where they wanted a little here and a little there i gave it to them and and not only did i give it to them i'd work with the unions on something over here or work with some more left-leaning initiative over there.

5:37Nothing too severe. But then the real kicker was I would go out and I would thank them for it. I'd give them credit. And sometimes they had some really great ideas. I mean, they really did. When you're dealing with things like mental health or health care, the opioid crisis, there's nothing political about that. There really shouldn't be in design. And so by bringing everybody in very early on in my administration, I'd bring in parents. I didn't ask them what their political affiliation was before I brought parents in to find out where the system had failed their kid. By doing that, you let everyone come to the table.

6:07You got to be governor. You got to say yes and no. You got to let the buck stop here. You got to make the last decision. But by bringing everyone to the table early on, it really set a tone that I wasn't there to, you know, split the atom, so to say, at the statehouse level. It was really about finding ways to cross party lines when you could, if it meant a better system design. That's all really positive. But were there cases where there were special interests that just broke things or were too hard? Like for me, for example, I think healthcare special interests are really powerful and make costs go up too much and things like that you dealt with.

6:36So, I mean, let's just start on healthcare really quick. I mean, because for those, I think most people, I think in the last few months, I think a lot of people are realizing and being reminded, Medicaid is funded by the feds, but managed by every state differently. So, I would manage my own Medicaid program. I was right next to Massachusetts, right? That was very tax heavy, just threw more money at old-fashioned systems. a really actually bad way to do it. We were more lean on that. So you'd have special interests, not just from New Hampshire, but from Vermont, Massachusetts, Maine, because they wanted New Hampshire to kind of join that New England pact.

7:09They're trying, yeah, they're trying to bring you over. Yeah, New England's very unique and all the six states are really tight. We don't agree on much. And we were kind of the diamond, I'll just say diamond in the rough, libertarian, Republican safe haven of the Northeast. And that's why everyone was moving to New Hampshire. That's why it was, you know, especially post COVID, it was like New Hampshire, Texas, Florida, Tennessee, Idaho, that's where everyone was going to. So those special interests weren't just within our state. They were coming across the board. And what I really had to do, especially in healthcare, was do everything we could to instill a free market.

7:38Now, I don't know what you think, but there's no free market in healthcare. It doesn't exist. The opportunity with saving money in healthcare and efficiency of delivery of services is the technologies that both not just you, but folks all across the country and all across the world are going to start bringing to the table. It's going to be awesome. Yeah, the AI should help us bring it down if you have competition. That's right. But you need the competition there, right? And you need the transparency and the usability of that system. So you need folks, regardless of what their income level is, whether they have a job, what their education is, how do they access those same tools as a consumer?

8:13Or how do the providers access the right tools to get to those folks to make sure that everybody in the system, competition works if everybody's competing, right? Competition doesn't work if just a few are competing. Then the rest of the folks are just kind of left to what comes through the filter, so to say. So I guess the point is I was always trying to have an engineer and business mindset to instill a free market. And when you do that, you're using data, using real numbers. If you have a pleasant approach, people even on the other side of the aisle will come in and say, OK, boy, we can't really argue with this data.

8:45We understand the special interests are there. And did I get everything I wanted? No, most things. I think one of the toughest, I never became a right to work state. I always wanted that. I missed that one by two votes. That was a tough one. But in terms of school choice, a lot of flexibility on the education side, more flexibility to parents. What we did with the opioid crisis I thought was pretty awesome in that we were, you know, had the worst death rate in the country. When I left, it was, it's still not great. It was like 24th or something in the country. But that was because we rebuilt the whole system.

9:14We looked at data. we looked at for example not to go too off track but you know the the overdose rates and the addiction rates in rural america are far higher than the addiction rates in the inner city but all the services are in the inner city right because that's the old-fashioned way of doing things so we broke down that system we said okay we're going to make sure that services are accessible in rural america as well and we saw addiction rates plummet and people get back to work and we created all these kind of cool programs that's not partisan like there's no Republican, just as many Republicans as Democrats ended up with addiction and overdoses, right?

9:47So there are certain things that just cross boundaries and barriers, and you can use those things to bring folks together so that when you get to the really hard stuff politically, you have a relationship. You've worked with these folks before. You know how each other works, and it makes it easier across the bigger divides. Washington doesn't do any of that. Not anymore. Right? I mean, that's the frustration. If they just found a few small, you got to find the small ones, whether it's in your business or politics or your family, find the small wins to bridge the small gaps. And then you tackle the bigger stuff and the harder stuff as you build confidence and transparency.

10:19You know, one of the few areas where they do still work together a little bit is on defense policy. There's some good moderates on both sides that just really care about the country. So I do see some things like that. I've talked to some people actually from New England and, you know, you get independence like Angus King, who I might not agree with on much, but when you're talking about defense policy and they don't want the country getting ripped off and they want the right solution so i i guess i guess i'm not completely cynical on dc but you're right overall it's like pretty dysfunctional it's a system right it's um it's that old um paradox where everyone says boy washington's terrible they all should be fired but did you vote for your senator last time well of course i did he's a great guy well you know so that's the system we see the senators are messed up so as you're working on all these problems and working together with people uh you managed to keep the balance the budget balanced in general yeah so um very much So I was very proud of it.

11:05We had surpluses every single year I was there. We balanced the budget. We cut the few taxes we have, like business taxes and things like that. We were always able to cut it. The reason that, you know, we're going to get into talking about the balanced budget amendment on a national level. But the reason I'm optimistic and I get excited about kind of forcing Washington to, you know, treat our money more responsibly is because states do it and they do it really well. There's models of success there. So anytime someone says it can't be done, you're wasting your time. No, no, no. States all across the country, I think 49 of them have their own balanced budget amendments.

11:35Even California. I said this to some, I won't say who, but some very prominent Republican friends of ours in Washington, D.C. Once I said, look, California has a balanced budget amendment. Now, the liberals out there will tax people and create fees and barriers. And it's just all about the money. The way they manage to that balanced budget is horrible. Well, they cheat because they don't have the pension debt. That's right. They cheat. They cheat it. But at least they have at least a guidepost they know they have to live by in some form. I said to these Republicans, you guys don't even have that.

12:06You have$37 trillion in debt. And a lot more than that, if you count Medicare and Medicaid, let's be honest, what's coming. And what's coming is the big part. So I am a big time optimist, but I'm an optimist because we still have a little time. we have eight i think we have eight or nine years here but there will be a i think a fiscal car crash so to say where social security medicare um the debt you know the interest what interest hit over a trillion this year uh interest will hit about 1.3 trillion more on more on our interest than on our defense now which is which is crazy because we spend a lot on defense but and but going back to balancing the budget sure at this date before we talk about national like what what did that look like were there things where you just said gosh we just have a bunch of administrative of spend in this area and we just can't afford it.

12:48And so it made it easier to cut it back. Like what are the types of things you could cut? Cause obviously there's always things to spend money on. Like, like how would you have those conversations about cutting? Sure. So the best way to cut is to cut with a, I call it a, an off ramp, not a cliff, right? You don't want to take a program and say, well, I can't afford it. So it's gone tomorrow. No, we can't afford it. So what we're going to do is we're going to ratchet it down over the next three or four years. And, um, you know, because it's inefficient, it's a lot of money going to a smaller population.

13:12You can move that population for whatever the need is into another program. You get rid of duplicative efforts. A little bit of what Doge was doing, right? I always say, you know, New Hampshire was doing Doge before Doge was cool. And then Doge wasn't cool anymore, apparently in Washington. But I loved what Doge was doing for a long time there. It was the absolute right approach. It just, it didn't, they didn't have enough political wind in their sails to keep it going as strong as it should be. But it's off-ramping things. So you slow programs down. You say, okay, next year, we'll cut it by 20%.

13:39The next year by 40%. The next year by 60%. We'll move these populations over. There's ways to do it. The problem that too often people see is we have a fiscal problem, so kill the program. You kill a program if it's really not doing anything. You slow a program down and graduate it to different delivery systems that might be more effective or just better pathways. That's really the way to do it. And you could get people there. If they knew that it wasn't going to be too hard, too fast, it wasn't like a program was going to get cut and they were going to get blamed on it being reelected. And by the way, I had a volunteer legislature, right there was always a lot of turnover people knew that you know they weren't fighting for their jobs per se they always wanted to get re-elected so it's easier to work for them because they don't have to yeah yeah they were all volunteering that time we had 18 year olds in the legislature we had retirees we had professional business people that's cool it was such a spectrum of individuals and it's interesting because a lot of things in government and the federal government i've seen i think actually do harm and i just want to cut but if something's not doing harm you're saying it just makes more sense to slowly cut because it could be some good things coming out of it if you saw it could be some good things out coming out of it you want to ramp it down and it's also politically easier for for the legislatures to swallow got it it's just yeah yeah they're not all elon musk running a company who just boldly say no like that's not who they are and elon was so right in what he was doing but they should have surrounded him with better methods and messaging i always say yeah especially because when he's like the dictator of his own company it's very different than how things are perceived exactly that's interesting and i yeah i wasn't even using it for doage but you're right because but i i think i think of like bold leaders i think of my friends where the top entrepreneurs are just so bold in their own companies but that's kind of shocking when it comes to something because it's their money right they can write the check with their dollars public sphere you need a better checks and balances you need off ramps that are slower just to get things and super transparent now i think what dojo's doing was actually very transparent but it was happening so fast people couldn't uh with the transparency people have to um absorb it a little bit they have to drink it in whoa wait what's what's happening okay you're doing this that's there that's there but to their credit they were going so fast people literally couldn't almost keep up which is the normal speed for our tech companies not the normal speed for government that's right a little different i got asked i was i did an interview uh in kansas city this morning and and he said well weren't they going too too hard too fast and i said but remember washington usually doesn't go anywhere it doesn't move so yeah they needed a little washington dc need a little bit of a kick in the butt they did it they jump started a system they opened the curtain on a lot of things that other administrations both republican and Democrat had not opened the curtain on.

16:06And in that sense, it was really good. I wish they would kind of... I'm waiting for Doge 2.0. Yeah, well, we still have some of our friends in all the agencies, and we still have my friend Joe Jebby as a chief design officer fixing a lot of stuff. So I'm quite bullish on some of the stuff. But you're right, we do need a Doge. We can run Doge 2.0 later on. There you go. We'll work on that later after this. But first, we got to get the balanced budget amendment. This is really important. So I think a lot of our listeners probably forgot what amendments are. uh so our constitution originally the bill of rights had i think there were 10 things originally and we can all we don't have to go over those right now don't worry i do remember i think i remember all of them you remember more than i do there you go and and so and so there's and there's a process for many of the constitution to add more and so so so in the in the idea here is we want to amend the constitution to force a balanced budget and of course you probably just like you're talking about off-ramps you probably can't force to be balanced next year because that would be impossible for these guys to do, but we probably could do something reasonably 10 or 12 years out with some kind of milestone halfway there.

17:05And this would be a very reasonable thing to move towards like all the states have. What does it take to amend the Constitution? So the path we're going down with the balanced budget, and Lauren Enns, who's kind of running this group, has done an amazing job. This was started, a little bit of history, started back, I mean, really Reagan picked up the mantle and got a lot of states. Got, I think, 31, 32 states. Really, really close, but not enough. And what you really need is 34 states to pass a resolution. So that's more than two thirds. Yeah, it's just one more than two thirds. thirds this one um 34 states pass a resolution a very simple basic paragraph that says uh we're going to call a convention and and put in an amendment and the amendment can be for anything but for ours it's very specifically written that it's just to enforce a balanced budget amendment because this could be scary if you called it it can be somebody wants to mention and then you do who knows what they're going to do yeah an open convention is a disaster nobody wants that they're going to make donald trump jr permanent monarch or something and that would be trouble and nobody wants that right um and there's a lot of fear and confusion over that but ours is written so clearly and specifically that it has to do with a balanced budget amendment very similar to what every state and by but by law but convention is still open no matter what right or how does it work by law um so i the rules would really be actually defined i believe you'd have to ask lauren but the the rules are really defined by the judicial committee i believe technically but it it's really it is confined you can't you can't bring up health care you can't bring up So it's a way to confine it to this particular area.

18:26And then the goal would be some sort of process to have a required balance budget. Now, of course, during World War I, World War II, depending who you ask, maybe during the year of COVID, the Congress might want the ability to not have a balanced budget. And so the way you'd structure it is a certain amount of the Senate could decide not to have a balanced budget. That's right. You can have a national emergency issue. You can have a declaration of war issue, just like governors have. Right. Governors have ways in a crisis to go back to their legislatures and ask for appropriations above and beyond.

18:53But you'd want to have, like, for example, at least 60 senators agree. Otherwise, you'd always have a war because it'd be 51 senators always saying there's a war just to spend whatever they want. That's right. And so it's not too hard. It's just the will to do it. And what's amazing is Reagan got pretty close. A few states rescinded in the 90s. Lauren Enns got involved here and he's brought it back. We have 27 states. We're about to get our 28th state in South Carolina, I think, this January. We have a few more states like Idaho, Montana, Kentucky. These will be the next states. Those are obvious ones.

19:22Those are obvious, right? So now I've talked to Speaker Johnson about this. Now we're up to like 31, 32 states. And here's the real trick. We don't want a convention. We want the threat of a convention. Because ideally, if the states, if we do a convention, Congress is cut out of the process. They don't get to write it. Now, what they could do is write it themselves today, like right now. And that's what we want. We want to say, look, we're right. We're about to get this done. Why don't you guys do what you know you should be doing? Write yourself a balanced budget amendment. We're not going to tell you how to balance it.

19:50You know, those details Congress can figure out. But if Congress writes that, then the states will have to affirm it. Then it goes back to the states for affirmation. So that way there's no need for actual convention. It's just Congress doing their work. That's right. Congress doesn't do work very often, though. But what a great piece of work to do. This would be great. To finally realize that they're actually going to treat your money with responsibility. You know, I remind people all the time, when you elect someone to Congress in the Senate, What you're really electing more than anything else is a financial manager.

20:15I mean, they're the most unqualified financial managers in the world, but they're managing trillions of dollars. When they decide what dollars to put to a program or what program is more important, that's really what they're doing with your money. It's not their money. It's your money. It's a lot of my money every year. It's a lot more of yours than mine. But I pay my taxes to the feds. I don't pay it to New Hampshire because we don't have that sort of thing. So it's just kind of forcing them to kind of get back to the basics. Now, when you talk to them one-on-one, they all get it. Even Speaker Johnson, oh, yeah, this is great.

20:45No, we want to maybe push this in 2027. And we think in the next couple of years, if we can get a few of these states lined up, a lot of things will be just on target to push Congress. Hopefully, if we can hold the House and Senate in 26, especially with Republicans, to say, we got to just do this. Because if not, the wheels really start coming off. Are there moderate Democrats who agree with us, but the party overall doesn't? Like, where are we on that? Oh, sure. They're like Max Baucus, Joe Manchin, Senator Ben Nelson. These are Democrats that have been on board. Clinton was on board with this, right?

21:16Traditional Democrats, I'd say pre-2015, there were tons of them that were traditionally on board with this. They're still on board, but they just don't want to put themselves out there until it is ready to get over the finish. The worry is the progressives are against it in general, right? Well, of course. Well, they're against everything. They believe in modern monetary theory where you just can create forever. I would hope that MMT, that concept has been burnt to the ground. With the inflation from lie to the new, it's kind of obvious. Exactly, exactly. I mean, I think I had an argument with Andrew Ross Sorkin.

21:45Not that he's an MMT guy, but just on this kind of concept. I love Andrew. He's wonderful, and I respect him a lot. He's super smart. But on this idea that have we just buried this concept once and for all, that as long as we can print money, we're okay. No. And remember, what are we dealing with? Inflation, right? That's the ultimate outcome of what would happen. We'd have to print massive amounts of money to basically pay the debt on all the money that we owe. It'd be a horrific cycle. And you'd get hyperinflation. And what is inflation? It's the worst tax on the poor. Because you can handle a little inflation.

22:18I can handle it. Most Americans can handle it. But that 10 % to 15 % of Americans that are really impoverished, they have to turn on their light switch. They have to buy milk like everybody else. And they get crushed by inflation. I think this is where a lot of populism is coming from in our country right now. right now as the inflation makes people angrier and so you get an angrier left and an angrier far right and it's it's not not what any of us want no and and so you know i mean we can get into this whole issue of how do you get people back to better discourse and what is driving a lot of that you know i'm a huge believer in technology i think social media it really is especially with the younger generation is really causing a huge problem a mental health problem and all that sort of thing and and everyone has to be involved in kind of how we manage all that going forward but it really drives populism because we consume information in these mini sound bites.

23:04They can now raise money. This is my real cynicism on Washington. I think they need massive campaign finance reform because they can raise money on such outrage as opposed to the successes they're delivering. It really is a problem where you just go online and make people angry and then you get money and it's not useful. That's it. And there's a lot of folks there that use this populism to show rage. And it's weird. I mean, you and I have talked about it before where the populist on the left and the populace on the right are kind of bending in a circle. They're kind of meeting. I mean, they're really joining forces in a lot of ways.

23:35Not in a, I wouldn't call it a bipartisan way, but their rage is meeting in the middle, which is a very weird place to be because nothing gets done there. You gotta, one thing I take a lot of pride in, in my four terms. People say, well, two years wasn't enough to get, is never enough time to get stuff done. BS, I got tons done. I'm so proud of what I got done every two years. You ignore the whole campaign stuff. You just focus on getting as much stuff done as you can, and then you're super transparent about it. It's more fun that way. So the balance budget, to me, is kind of tied to some version of reforming entitlements.

24:08You can get it done without reforming entitlements, but at some point, if you're going to make the budget balance, you have to look at those. And it's interesting because I feel like the Republican Party, as well as the Democrats, probably even before them, when they go to this more extreme part, you're operating like an angry crowd. And angry crowds, you know, we're into scapegoats, right? And so it doesn't mean the scapegoat is necessarily a right. So, I mean, there probably are problems, I think, with illegal immigration, by the way. And I think there are problems we shouldn't have third role in our country.