Why America Is Losing — And How We Fix It - Andrew Liveris

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1:24There's a lot of nationalist tendencies out there. When China came into the World Trade Organization, and we left them unchecked over a multiple decade period of time. There was massive technology transfer to China from American companies. They were way better at it than we ever thought that they would be. They've replicated a lot of that technology, in fact, we pushed it forward and actually made great advances in that technology. And our smaller cities, the Midland, Michigans, have been left behind. In some areas, have been devastated. This is one of the things Mr. President Trump ran on successfully, was this globalism, resource allocation of human capital and capital capital outside of the U.S.

2:01crushed us. People were happy with that until they started to see the erosion of big jobs in lots of little towns. The middle part of America was suffering mightily from the loss of the ability of their kids to get the decent jobs after university into these industries. Welcome to Open Book. I am your host, Anthony Scaramucci. And joining us today is Andrew Liveris. He's a bestselling author. He's the former CEO and chairman of Dow Chemical. He's chair of the Brisbane 2032 Olympics. Right. Which, by the way, were you at the Sydney Olympics, Andrew? Yes. Of course you were. Yes. One of the more exciting global events.

2:41And he's a global advisor on business and policy around the world. Lots of corporate boards that you're a member of as well. A couple of different books. The first book, Leading Through Disruption, A Changemaker's Guide to the 21st Century Leadership, which I loved, and then Making It in America, The Case for Reinventing the American Economy. I wish we could drop that off everywhere. We should probably have like an airdrop of that book, mostly around Washington, maybe that 18 acre parcel of land that surrounds the White House. But Andrew, thanks for joining me today. You grew up in Darwin. Yes.

3:21So Darwin, for those Americans that don't know Australia, is the north of Australia. Right. Exactly. It's actually warmer. We like to think of the north as colder, but in Australia, because you're down under, you're in northern Australia. And we have US Marines in Darwin. You know that. You do. You do. A lot of Americans don't know that, But we have U.S. Marines there as part of our national security umbrella to help Australia. Yes. But talk about growing up in Darwin. How do you go from Darwin to leading Dow Chemical, advising U.S. presidents, and now being the chair of the Brisbane Olympics?

4:03Like you, I'm the son of immigrants, people who were courageous, in my case, from Greece. my grandfather took the wrong ship four ships from the little greek island found his way on a ship from singapore and instead of going to the south of australia where melbourne and perth and sydney are he went to darwin which was a little settlement 3 000 people miners camp really in the north and from there he and then my my father and his brothers built a building business, very successful. I was the first to go to university. There was no university in Darwin. So I was sent to Brisbane, Queensland, back to the Olympics and did chemical engineering.

4:46And you asked why chemical engineering? Well, for some mutation, I was good in chemistry. Don't ask me why. And I just love chemistry. And I did chemical engineering and, you know, Dow hired me straight out of college in Brisbane. But the Darwin experience gave me multiculturalism, Anthony, a lot of Asian people there, like you had the gold rush in San Francisco, we had the gold rush in Northern Australia. And so a lot of Chinese came down in the 1800s. So a lot of people from Indonesia, Malaysia, I got to mix with Asian races as friends. And I think that as a young person taught me about diversity in the real sense, that people are people, doesn't matter what they look like.

5:29And so growing up there, no TV, no modern conveniences, I think it really shaped me. And the American moment for me was JFK and the Man on the Moon. As a nine-year-old, that just told me that America was this wondrous place, you know, that could do anything. And so I always wanted to come to America. And when Dow offered me the job as a 21-year-old, I jumped at well i mean there's a lot going on there so i don't i don't i want you to drop that australian false modesty for a second and i want you to channel your american bravado because you did live in america right and you and you had to run dow from america all right what's the obscure town that dow has its midland midland michigan right so you're in midland michigan living in uh as we say on the coast you're in murica america not america you know that's like the hot dogs in the nascar america so you know you have this ambit dexterity to your personality you get along with everybody what do you attribute that to well again you know uh growing up in darwin and multiculturalism and then being of greek immigrant parents you know we were discriminated against as greeks i mean you know we weren't the white anglo-saxan protestant so in australia you know to get ahead in my era, you had to go to the right school, you know, very British in that sense.

6:56And so I was a mold breaker because I absolutely challenged the conventional as a young person. And I really felt that that meant that I was inclusive and that you had to walk in other people's shoes, the proverb, right, to really understand them. So I never judged people based on things that I heard and read in the press, in particular the press. And so I had lived experiences. And the American model of taking Australians as an English-speaking nation, English-speaking nation, and putting us in different places, my early assignments in Dao were all in Asia. And I loved it. I went to China when it wasn't a thing.

7:37And so I put it down to that. That gives me inclusiveness as a primary way of doing work and business and relationships. Relationships to me are everything. I was surprised by your book. I'm going to tell you why, because I saw you as a, we've gotten to know each other. Obviously, you're an incredible, amiable person, very personable, but you're an entrepreneur. And when I read the book, I was thinking, okay, Andrew's obviously a great guy, incredibly personable. He's got to be this corporate leader. Dow is in the S &P 500. He's got to have this sort of regimentation to your personality and this corporate structure.

8:16There was none of that in the book. I would recommend this book to any entrepreneur that I come up with. So why is that? And how were you able to maintain that despite this illustrious multi-decade career in corporate America or global, let's call it global corporate society, if you will. You know, I'm going to give you a simplistic answer, as I'm prone to do. Time zones. I grew up in Asia, doing business in Asia, where Midland, Michigan, the two headquarters in the middle of Tundra, nowhere, Michigan, was 12 time zones, 48 hour time zones away. And before email and, you know, all the things that we're used to today, back then, you know, you had to make decisions on the spot.

9:01And so I learned that I didn't need the corporate policy book to do what I needed to do to give Dow a front advantage. And I became a corporate entrepreneur. And so when I was selected to be CEO, and I was asked to come to headquarters, and they could smell me and see me in the corporate headquarters, I was a building entrepreneur from day one. And so when I made the pitch to what I would do with Dow, I said, we've gone asleep. We're a hundred-year-old calcified enterprise that was great once and has lost its way. I would change how we operate. I would change the culture. I would be a culture buster.

9:41And I would bring entrepreneurism back to, in this case, Dow, but the chemical industry in general. So they wanted me for that reason. And I said, okay, you hire me. I am not going to rest. I'm going to change us. I got to tell you, that was easier to say than do, changing 60 ,000 people to being entrepreneurs when they're used to the corporate rule book. Great storied companies in America died, okay, because they didn't do that change. Right. Well, I was given the mandate by the board to be an entrepreneur as I learned to be in Asia. Right. And that, frankly, is what I'm doing today. I'm having more fun today than I had being CEO of Dow because now I can be an entrepreneur across a whole plethora of different places, including the Olympics.

10:23It's because you married right, Liveris. Okay. You married right. And you're getting the opportunity to finally enjoy your beautiful wife. That's the reason you're doing so well. You got that right. This is, you know, listen, I feel, I read your books in reverse order. Okay. I read Leading Disruption first. Okay. But then I read, you know, second book made in America second or making it in America, make it in America, excuse me. But I felt like the first book is more relevant for 2025 in some ways. You had some prescience in this book. This book was written, correct me or wrong, maybe 10 years ago, 2013 or something like that.

11:02Yeah. So what did you see in 2012 and 13 that is now so eminently relevant here in America? Yeah. Look, the second book touches what the first book presented. I was CEO for seven or eight years, go to Washington very regularly. And frankly, it was like getting root canal surgery on a daily basis. I would go to Washington and talk to legislators and educate, I mean, people in the executive branch. And I would get nowhere on what the American competitive advantage needed to be from a policy point of view. You know, I was getting told what the policies were and had to be based on political expediency.

11:45In other words, what gets me elected? So the short-termism of government was now prevalent. We already got short-termism in finance. When we throw government on top of it, and those two bodies that made America great were calcified on policies that were relevant to the 20th century, I said for manufacturing in America, only 11 % of the economy, we will lose invention. We will lose R &D. We will lose to China and other competitors who are investing in R &D for the long term because with manufacturing gone, R &D goes. Every R &D lab is attached to a prototype manufacturing facility. That was what made me write that book.

12:25I was so frustrated. Thankfully, it got President Obama's attention. He made me co-chair of the Manufacturing Council for his two terms. And then to my great surprise, I got the call from President Trump when he got elected with president-elect, second day, to come in and do the same with his administration. But your point, it's never been more relevant than now. And I could write that book again now and change very little. Because you know what? We're making great progress in digital technology and AI and all the things. But the heartland of American inventionist materials and the things that go into building the real economy, we've been losing and losing and losing.

13:07And so there's a lot of things going on in the world right now, including tariff protection, which I don't believe is a good thing because it's a blunt instrument. But it does have the effect of bringing back capability to the US. And not that I would go there as my lead, I'd get the right policies in place first. But to do that, I've got to educate the politicians. And frankly, I've got to get a different genre of politician elected. And that's a much longer game. So the book was written with that in mind to help the policymakers come up with competitiveness for the new America. You know, I got this wrong.

13:46Hear me out for a second. I want to get your reaction to it. And then I guess the real question is what to do now as an industrialist and someone that's a beneficiary of our global society. So I think globalism gets a bad rap, by the way. I think the help of globalism, the interconnectivity has raised more people from poverty and raised living standards just about anything that's ever happened. But we do have a bad rap on it now. There's a lot of nationalist tendencies out there. But one of the things that we got wrong is when China came into the World Trade Organization and we left them unchecked over a multiple decade period of time, there was massive technology transfer to China from American companies.

14:25They were way better at it than we ever thought that they would be. They've replicated a lot of that technology. In fact, we pushed it forward and actually made great advances in that technology. And our smaller cities, the Midland Michigans, have been left behind, as you and I both know. Yes. In some areas have been devastated. This is one of the things Mr. President Trump ran on successfully. Yes. was this globalism, this resource allocation of human capital and capital capital outside of the US crushed us. So number one, am I exaggerating that or do you believe in that or do you believe that happened?

15:06And then number two, what would you do to cure it if there is anything? I feel like the globalist train has left the station, right? 60 % of our parts that go into a Boeing aircraft are coming from outside the US. So if you're going to put tariffs on them, you're going hurt Boeing, but what would you say? Am I right in this 25-year assessment? Am I wrong? And if I'm right, then what do we do, Andrew? Globalization 1.0, the WTO ascension of China, early 2000s, was the right move if you paralleled it with an invention economy in R &D and sciences and said, for these sectors, I've got to grow in the US.

15:50I've got to grow in the only consumption society on the planet. Remember, what made globalization 1.0 work was US consumption and the US ability on its balance sheet to take on infinite debt, which is a whole other topic. So that consumption model, Europe was not a big consumer. China was barely a consumer, meant that all the capability was being built outside the US to supply the US consumption model. And people were happy with that until they started to see the erosion of big jobs in lots of little towns. The middle part of America was suffering mightily from the loss of the ability of their kids to get the decent jobs after university into these industries.

16:35And pick your favorite sector, automotive, chemical, you name it. They all suffered. Materials, science, you know, aluminium. medium. So globalization 1.0 was bound to run out of runway if different consumption societies didn't get created. And here's the problem with the different consumption society created in China, and for that matter, Japan, the forerunner to China. They have barriers to entry for foreign multinationals. They create not just financial barriers, but specification barriers. I used to say about Dow, we were big in every country in the world, but I could never be big in Japan because they created specifications just for Japanese companies.

17:13So the non-tariff tariff barriers meant globalization 1.0, equal access to every economy, was doomed to fail. So now we've gone too far. What's globalization 2.0? Well, I think we're going to see the reinvention of supply chains coming from countries that accept our labor standards, accept our environmental standards, and enable equal access to their economies. So then you select in countries to do business with. Globalization 2.0 will be regional alliances, Anthony. And who will be the forerunner and creator of those? I'd like to think the policymakers and the politicians, but honestly, they don't understand the globe the way business people do.

17:57So what you need is to have business people at the table working with policymakers to say, how do I create equal access? How do I make my trading partner do what I do to treat citizens well on those standards that I'm talking about? The DAOs, the IBMs, you name the companies. The companies that are big around the world understand this. When I was the general manager of Dow in Thailand, I had to build Dow chemical plants in Thailand. And if I went by the Thai standard, they would never, ever be approved in the U.S. So what Dow did, I had to build them by U.S. standards. Today, every Thai plant is built by the US standard.

18:38We exported our standards so that Thailand could benefit from it. Those regional alliances, people are seeing the tariff question as just a pure financial penalty one way or the other. What they've got to see is it's creating a new trade paradigm, forcing countries that took advantage of the US consumer to open up their markets on equal standards. That, for me, is globalization 2.0. Well, I think it's very well said. I want to go to something in your book that I admire this about you. You talked to prime ministers, presidents. You mentioned both Trump and Obama, which I should probably call Trump and let him know that you were tight with Obama.

19:22That would really set him off. You know what I mean? He knew it. He knew it. He was trying to make a point. I know that stuff sets him off. But anyway, first of all, how do you create that chemistry. And then without giving up names, tell us about one conversation behind closed doors that really struck you. You know, we saw leadership at its best or worst, or I think what sometimes happens to people that are not close to leaders, Andrew, is we either demonize them or we create this heroism and hagiography about them, where as you and I both know, neither are true. They're just human beings in high profile positions, high stress positions, ambitious and smart, certainly, but also prone to the human foils that we all are, the vulnerability that we all have as human beings.

20:11So tell me something, give me some instruction, give me some guidance. A lot of young people listen to this podcast and tell us something. Everyone's putting their pants on the same way. Tell me some good things and some bad things that you've seen. Again, without names, just concepts. I'll give you a couple, including one that's in the book, but one that isn't. But I want to sort of lead with this notion that I learned in Asia. And I've created an academy at my alma mater at the University of Queensland. I've got 110 scholars there where we're teaching this. And this is a very important thing for young people, to your point, and people who listen to your incredible podcast, Anthony, which is, you know, I learned a long time ago, the two ears, one mouth philosophy, to be an incredible listener and to make sure that I hear people when I listen.

21:02You know, I see them. Because I think in our short-term ADD-driven society, we are losing that ability to be not just great listeners, but then internalize the message and then reflect on it and come back with an answer and a measured solution or whatever it is, and even an opinion where people say, okay, he's thought about it. He says, this is actually something that matters. Giving that respect to anyone, I will tell you that my time at Dow's CEO, I gave as much time to the janitor and the person running the forklift truck in the warehouse. I'd make a point of when I visited a Dow site, I'd be in the factory listening to the control room operator and making sure I was hearing what they were saying about their roles.

21:50And I would educate them back on matters, for example, trade, and what we were doing to help preserve their jobs, whether it's in the US or elsewhere. So that skill I learned early, I got taught that by some great mentors. A couple of moments that I've had over the years that showed me the point you're making about human vulnerability at every level. One of the top vice premiers of China, when I was China in the 90s when it wasn't Vogue. I got one-on-one audiences quite often. One vice premier in the early 00s when I was CEO, just CEO, shared with me this incredible journey China's been on from a personal level, told me his backstory of being persecuted under the Mao era, the massive revolution that occurred in creating the communes, and how he came through that as a young boy, all the way to being vice premier.

22:47And he said, what the West gets wrong about us is they don't realize that our human story is very fresh in our minds. Your story is 200 years ago of revolution, where you had to lose people in a massive revolution against England, and then you had your own civil war. That effect on your society is long gone. In other words, You're not living that anymore. We're living what happened to us. And you know what happened, Anthony? He teared up. He teared up. He said to me, I have a huge responsibility to the millions of people in my country that never had that opportunity. And now that I'm in this role, that's what I'm geared to do.

23:33I'm going to give them the opportunity. And you know what? He said to me, democracy is not our answer right now. Okay? It may well be one day in the future. That was a very human moment that I had with that vice premier. And then the one that I do refer to, I mean, I met Lee Kuan Yew, the creator of Singapore, when Singapore was struggling in the 80s and 90s, and listened to him on a one-on-one basis about his vision. I mean, he was envisaging the 21st century in the middle of the 20th century. I mean, this is why I'm doing so much work with the Crown Prince of Saudi Arabia. I see these visionary leaders that come around.

24:16And then when I get close to them by being good listeners and hopefully good advisors, like Lee Kuan Yew, I see that they have a perspective that helps them be resilient through the tough times. And this is what I want young people to learn. I want them to learn that being knocked down or seeing the short-term setback is an opportunity to actually create the long-term better answer. And I teach that at the academy, and it's basically how I was taught. So I'm an optimist by heart. I'm resilient. I'm persevering. I persevere, and I never give up, and I live life on the numerator, not the denominator like I talk about in the book.

24:56I think that's very important for young people to learn. I think it's so well said. I think it's also important to remember the human element. I think one of the other things that I really appreciated about both books, but particularly leading through this disruption is the human element. It's not just measured in shareholder value, but you also put a lot of emphasis on societal impact, customer relations, customer development, and employee development. And I think that that's some old school stuff, Andrew, because when I got to Goldman Sachs, John Weinberg always said, put the customers first.

25:36We'll figure out everything else. The investment banks today are more about counterparties. You're no longer a client to them. You're just someone they're going to potentially trade off of. But how do we embolden that? How do we get that message from your book to as many people as possible? Well, thank you for doing the podcast. I've done my share of message transmission like this. But to your point, I need ambassadors. I need people who believe that the long-term effect on society is what we're all here for, that the economic incentive that capitalism brings us is doable, but you do it in a way which impacts society in the positive way.

26:21So take the risk, be the company, be the leader that puts in place the policies working with government, the regulator and the regulator should be a partner that absolutely sets the highest standard on environment, on society, on all the things that society is caring about, digital, digital access. Take that risk for your enterprise, take that risk for your company. So in the book, I finished with the whole last chapter on that business has to lead, but not by tell, but by show, and that by absolutely working together with government. And that also means that I need a generational change in the type of CEOs that get to the C-suite, and I need a generational change in the type of people that run for public office.

27:07So I finished the curricula of my academy saying, your first job should be to go out there and serve. Go serve in any role you wish, whether it be in government, local council, whether it be, I don't know, the people that actually do philanthropy around the world, like teach in America and other philanthropies. I mean, go serve to be a servant leader. And so that when you come back and then do the big things you're going to do in life, or maybe all the way to CEO, maybe all the way to being a senator or a legislator, you have learned that your presence absolutely sets the context for how things get done for society by thinking about the people alongside you, not the people below you.

27:56The old command and control model of most economies doesn't work because we're serving everyone equally all at once like that movie and getting no result. And we're creating divisions and classes. This country, America, what a wonderful institution, a great constitution. It has got the ability to flex on the paradigms of change without changing its core values. which is why I see government as absolutely totally a transient thing. What's the long-term thing? How can you impact it fully long-term? What's the visionary? What's the Alexander Hamilton moment, to use that, that this country needs? I think this is where young people need to take on the change management of that, and that's what I'm hopeful for.

28:48Meantime, my message in this book and elsewhere the book's been well received i'm doing as much as i can thanks again to you today to transmit it well i mean it's not me i mean you you've done such a great job i mean this book is a it's been a bestseller over the last two and a half years since it was published i i guess i guess the the message is uh it's a common sense message what i love about your message and I love about your realism is it's a blocking and tackling. I find that a lot of people I talk to are to overcomplicate things. When I had the opportunity to meet with Mr. Buffett many years ago, Warren Buffett, and he took me through his investment process, I walked away from it and I said, I can't be right.