166. How Trump’s War is Costing America

18:13Anthony Scaramucci:That is true. The striking silence from China, the fact that the Chinese are now banning exports of refined oil, even though they're sitting on a lot of it themselves. The Chinese feel like they're in a strong position at the moment. They can wait out what is happening. They have the supplies of oil to wait out what is happening. And they don't want Iran crippled in the long run. And there is now a growing kind of global South coalition of which China, India, and Russia are kind of a part where they oppose this sort of adventurism on the part of the United States. The way that this is panning out inside Iran, to your point about do you create a population that is more anti-American, I spoke to a friend of mine who's in Iranian exile this weekend.

19:04Anthony Scaramucci:About a week ago, they had suggested to me that they were kind of excited about the prospect of what might happen. They were nervous, but they were excited about the prospect of what might happen. And now they're super depressed. Now they see that Donald Trump is not going to follow this through, having launched these strikes which have hit the Iranian public. And remember, 90 % of the internet is still out, so the opposition can't mobilize even if it wanted to. There's no way for them to communicate around the country. Iranians who are living out of the country are having problems getting in contact with people who are in the country.

19:36Anthony Scaramucci:I think this is at risk of flipping from having been quite supportive of the idea because there is so little support for the regime of regime change because I've lived in countries with Sharia law. It is an awful way to live. And there are a lot of Iranians who hated it. I have a lot of sympathy for that proposition that they wanted to get rid of the Ayatollah. And there was celebrations when the Ayatollah was killed. But now you get crickets from the Iranian opposition and Iranians in exile are feeling already disillusioned because they see that patience is going to run out. They see the oil prices.

20:10Anthony Scaramucci:They see that actually there was not the planning that there needed to be for the consequences of this. This is what worries me about what we've seen over the last week, Anthony, is there's an incompetence factor here. You strike the Gulf and you think that it's not going to impact oil prices. Why aren't you already having the discussion about the strategic oil reserves or having the discussion about the gas tax? You don't plan for bringing your expats home. I'm hearing of people who have two passports who are being brought home by the Luxembourg government, not by the American government. So then you think, well, if that wasn't planned for, what else didn't they plan for?

20:49Anthony Scaramucci:How confident are we feeling? Yes, we're hearing that the military strikes are going incredibly well, but what else didn't they plan for?

20:57Katty Kay:Let me tell you what I know and let me tell you how these guys think. So what happened here is Netanyahu is putting huge pressure on him. And Lindsey Graham, I'm told. Lindsey Graham and they meet the day after Christmas, pounding Trump. We've got to launch missiles. I'm going to do it. You've got to do it with me. All the stuff that he threatened Obama with that Jake Sullivan's talking about.

21:19Anthony Scaramucci:Donald Trump is not able to say no to Bibi Netanyahu. Since when can America not say no to the Israelis?

21:24Katty Kay:Well, okay. So that's one element of it. But I want you to hear the pitch because this is what they do to Trump. The guy Bill Pulte walks in. He shows a picture of Donald Trump and FDR. And he says, FDR invented the 30-year mortgage and look at you, you're going to invent the 50-year mortgage. Trump gets super excited and he immediately puts out on Truth Social, we're going to have a 50-year mortgage. Of course, that's like indentured servitude, so it dies on the vine. But they pitch him a few weeks back and they say, listen, the Six-Day War was a monumental cornerstone of Israeli history. because the Six-Day War, they pushed back the Egyptians, they obliterated them, they took the Sinai Peninsula, and they forced secularism in Egypt.

22:13Katty Kay:They got Sadat in charge and forced secularism. 11 short years later, you got the Camp David Accords with Jimmy Carter, and you had peace and stability in the region between those two adversaries. And so the six-day war is the model here. We're going to hit them super hard. 85 % of the people hate the regime. In the 12-day war last year, they didn't do anything. They just said, hey, hello, we're going to hit these targets, get your troops out of the way. And so Trump is sitting there because he's impetuous. And Trump is sitting there because he's theatrical. This is the pitch. And only you can do it.

22:58Katty Kay:All of your predecessors have been too weak. So I just want people to understand what they do to Trump, right? So they go in there with the six-day war pitch. It's a form of flattery. But they also compare it to Egypt. And they say, well, you're going to have your own six or 12-day war. You're going to decapitate the regime. You're going to put a secularist in there. And then like you did with the North Koreans, you're going to fly over there. and you're going to have this only you can do it deal. So that's what they did to them. And I want people to know that. So number one, they're sitting there listening saying, okay, that's effing crazy.

23:34Katty Kay:And then the other thing they're saying is, okay, that's also probably true, given everything that we know about the situation.

23:40Anthony Scaramucci:The trouble is that we don't have the person to do the deal with. And as you said at the beginning of this, basically they are counting on the idea that the Iranians are like him and will do some kind of a tracks and action deal for money. and they'll want to get it done. But now we've got this new Ayatollah Muttaba in, where there are reports that he has$100 million in property assets around the world, so maybe he will do the deal. But he's also clearly a hardliner. I don't think these are the people that Donald Trump thought after 10 days he was still going to have to be negotiating with. I think he thought this would be quicker than this and that the public would rise up because he's seen the polls and he's seen the dissatisfaction and he's seen the uprisings in January, but this is a battered, abused population.

24:26Anthony Scaramucci:And right now, they are not in a mood to rise up if they don't think that the Americans are actually going to be there to support them, which looking at the oil markets, they may well not be.

24:35Katty Kay:Yeah, they don't have the arms.

24:36Anthony Scaramucci:And you bomb a school, it's going to make, and then you deny that you bombed it, and you don't express remorse and apology. I don't think that's going to help the American cause in turn when they come to try to negotiate. I think that side of the strategy has gone wrong. He may still be able to declare victory along the lines of the narrow operations that some of the military people are laying out. He may decide he's done in a week. The economic cost is too high. He's going to declare victory anyway, and he may get away with it. And then we move on. And there isn't a big knock-on effect in the midterm elections in terms of the economy.

25:09Katty Kay:I just want to say three quick things about the new leader. Yeah. Okay. So I'm going to read you a quote. Okay. Motaba is widely viewed within the regime as a capable and forceful leader and manager who may someday succeed to at least share national leadership. Okay. That is U.S. Embassy cable picked up by WikiLeaks. And that's a U.S. Embassy cable from 2008. Okay. That's number one. Number two, the father did not want him in this position. You know, he tapped his father's phone. There was a rivalry and there was some anxiety between the son and the father. Okay, a little bit of patricide going there.

25:52Katty Kay:And he was not pleased with the idea of his son's leadership. And he didn't want the idea of him being raised as supreme leader ever raised during his lifetime. Okay, and I just want to read you this one last thing because I did some homework on this last night. In addition to having all this money and he has a flat in London, he's a hardliner.

26:14Anthony Scaramucci:He's an ILGC, Afarachic.

26:16Katty Kay:He is. And he was also, when he was in the Iranian-Iraqi war, as a younger man, he was in the most ideological part of this. Okay. So when you are looking at this, okay, and Ali Hassam, who's a pretty competent Al Jazeera correspondent, says that this guy is a confrontational leader and we're not expecting any moderation. Now, Trump called him a lightweight and Trump did his flex. He's not going to last if he doesn't listen to me and take orders from me. Do you think this guy's going to take orders from Donald Trump, Katty?

26:52Anthony Scaramucci:This is not Delce Rodriguez. I mean, this is not the person they thought they were hopeful. This is not Deng Xiaoping. This is not Gorbachev.

27:00Katty Kay:These are people that have been raised in martyrdom. These are people that see the Americans as imperialists. These are people that see the Americans as interventionalists in their 5 ,000-year-old civilization. And there's something ancestral here that everybody should be aware of.

27:23Anthony Scaramucci:Okay, let's take a break there, and then we will come back and talk more about the cost to the American people. To some, he is the revolutionary hero who restored China to its rightful place on the global stage. To others, he's a brutal despot, accused of presiding over more civilian deaths than either Stalin or Hitler. Mao Zedong has one of the most recognisable faces in the world, yet he started life as a rural boy in a muddy provincial village. A rebel son who hated his father survived a 6 ,000-mile walk across China and rose to become a figure of titanic proportions. From Empire, the goal-hanger world history show, I'm Anita Arnon.

28:05Anthony Scaramucci:And I'm William Durrenpul. In this six-part series, we're joined by world-renowned expert Rana Mitter to explore the life of the father of communist China, Mao Zedong. We'll track his rise from a bookstore owner to a guerrilla commander and we'll witness his ruthless elimination to secure total power. We'll explore the greatest famine in human history, a catastrophe where Mao himself predicted that half of China may well have to die. And we'll descend into the dark experiment of the Cultural Revolution, a time when ancient temples were burnt, children denounced their parents and a nation worshipped a mango as a sacred relic.

28:50Anthony Scaramucci:And we'll play a clip from the series at the end of this episode for you to listen to.

29:14Katty Kay:And yeah, my very own showcase, telling my story the way it should have been told. Because when the show never stops, anything is possible. Available March 13th. Pre-order now. I'm R.J. Decker, a private investigator uncovering the sunshine state's darkest secrets.

29:31Anthony Scaramucci:Tuesdays, it's the premiere of ABC's hottest new crime show.

29:35Katty Kay:R.J. freaking Decker as I live and breathe. He's a private eye. It's not a standard murder. It's someone bigger. And a public mass.

29:42Anthony Scaramucci:Trying to get some back to prison today?

29:44Katty Kay:You go to prison one time and suddenly it's all the jokes. R.J. Decker, series premiere, Tuesdays on ABC and stream on Hulu.

29:59Katty Kay:Now we can talk about the economy. You want to blow up my country, but I have a plan in place I've been working on for 20 years to blow up your economy. So, Katty, how are they blowing up the global economy?

30:10Anthony Scaramucci:Well, first of all, the American public, as I understood it, elected Donald Trump to go to war on prices, not to go to war on Iran. But I think you're right. They're doing everything they can right now to blow up the US and not just the US, but the global economy. We're looking at a serious energy crunch in Asia. You've got one in 10 of the world's oil tankers trapped in the Persian Gulf at the moment. You sent me something. Goldman Sachs is talking about Oil price is going to$150, possibly even$200 a barrel. You're getting Americans already starting to pay more. It's not just oil that is being squeezed when the Straits of Hormuz are shut.

30:51Anthony Scaramucci:You've also got sulfur, you've got fertilizer, you've got aluminum, a whole bunch of things, commodities, knock on commodities that come from that region that are also being squeezed at the moment. In a way, the economic angle of this, I think, Anthony, is the most dynamic angle this week because it's the most unpredictable. This has to end quickly for there not to be, my understanding is you know much better about this than I do, but my understanding is that this has to end really within the next week for there not to be weeks, potentially months of knock-on effect on global growth. Because having paused your refineries in the Gulf and your export capabilities, it takes a while to get them back on stream again.

31:38Anthony Scaramucci:So, what do you see as the economic impact?

31:41Katty Kay:Yeah. I mean, I want to just add to it, sort of remind people, we learned this in COVID, the supply chain isn't an on-off switch. The UAE doesn't say, okay, we're stopping oil production because I can't ship the oil into the Gulf. and then you say, okay, well, now we're going to restart oil production. Okay, it takes three, six weeks before we can get everything up and running again. So it's not like an on-off switch. So 20 % of the global oil supply coming through there, they've slowed it down. Okay, they're trying to do what I call petrostate contagion. They're hitting everybody to get everybody in a tumult.

32:17Katty Kay:The UAE has to be, in my opinion, the most concerned about it because They've got 10 million people living there, nine of which are expats. And expats, as you know, are mobile. And you don't want to put at risk this great virtuous circle of their economy, real estate, luxury, all the different things that they're doing there. They're doing dollar weaponization in reverse. And just hear me out for a second, because this is something that one of my buds explained to me yesterday afternoon. They are accelerating petrodollar bypass deals. are pushing oil sales in yuan and rubles and rupees, and they're doing this through their back channel networks.

32:56Katty Kay:And this is going to put de-dollarization pressure on the Americans. So the prices are going up and they're moving away from the petrodollar. They are also using, remember, Iran has its own 8200. What is 8200? That's the cyber squad inside the Mossad and inside the IDF. Okay. And what are they doing? They have previously targeted Saudi Aramco and the US banks. Okay. And they're now attacking the Swiss system. Okay. And they're attacking the energy grid in the Gulf. The energy grid in the Gulf is under assault. Now they're not hitting the desalization plants yet. Now there are reports that we hit one of their plants.

33:41Katty Kay:We could argue whether or not that's a war crime. I hope to God we're not hitting their plants because that's humane, frankly. I mean, you don't want to go in that direction. But here's the core logic of it all. Okay, ready? I can't win the conventional war. But if I create asymmetric economic disruption and I raise the cost of the conflict into US politicians, which we know are short-term caddy until they break, okay? And this is the same playbook, frankly, that Hezbollah has used militarily, but they're just applying it to finance, right? So to me, I'm sitting in Mar-a-Lago and I'm now going to be Donald Trump again, and I'm getting pitched on the six-day war for Iran, and I'm getting this little historical thing.

34:29Katty Kay:And I'm saying, okay, this is wonderful. And there's nobody sitting there saying, hey man, just to let you know, they've been working 20 years - On the counterplay. On the counterplay. Yeah. And you're not thinking about that.

34:43Anthony Scaramucci:And how do you feel about oil gas prices at$150?

34:47Katty Kay:So Bozo Hegseth is not thinking about that. And Weathervane Rubio is not thinking about that. And you woodchip Vance. I mean, he's basically non-existent right now. But again, I just want to explain to people what is going on and why we haven't anticipated it, because we've lost our way, Katya. We've lost our process.

35:13Anthony Scaramucci:Well, because there aren't enough people around the president, and every president needs no people around them. And this president in this term doesn't have enough no people around them. So, Anthony, here you go. Let's close with this. This is the president posting on Sunday. Short-term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for USA and world safety and peace. Only fools would think differently, all caps. Maybe we're fools.

35:41Katty Kay:And, Katie, we didn't even get into the fact it's$900 to a billion dollars a day. Of what's being spent, yeah. And he doesn't have it in the budget for that, so he's got to eventually go to the Congress.

35:52Anthony Scaramucci:And you have Tommy Tuberville, conservative Republican senator, coming out in public this weekend saying, well, I just hope that they had planned that we have enough missiles when they started this war, which made it sound like he wasn't particularly confident that they had actually planned for that. Because you've got American munition stocks being downgraded too because of this huge onslaught that we're seeing. But anyway, Hegseth is happy because he says this is not a politically correct war and none of the rules of law apply. Yeah.

36:26Katty Kay:I mean, he really talks like an imbecile. It's actually embarrassing to listen to him talk. But why don't you think of these ironies before we leave, Caddy? The transactional dealmaker, Donald J. Trump, who wanted cheap oil triggers the most expensive energy shock in a generation. Think of the irony there, okay? Trump's base, okay? America first, working class voters, They drive trucks, they heat homes with oil, they live paycheck to paycheck, getting crushed, caddy. The Republican coalition now fracturing, this is between the isolationists who want out immediately and the conservative hawks that want, I guess, I don't know what they want.

37:06Katty Kay:I guess they want to blow up Iran, I guess, because they blew up Iraq with such great success. They want to blow up Iran. So I just leave our viewers and listeners with the following thought, okay? Iran does not need to win the war. They just need to make it expensive enough so that the Americans, and I'm talking about the man on the street, Americans, Caddy, demand an exit. And that's basically where we are right now. Unless you're telling me that I have this analysis wrong and Trump has this unbelievable idea that he's kind of come down like he did from Mount Evo with the orange tablets for the tariffs.

37:45Katty Kay:We're going to have another Liberation Day here. And he has some idea that you and I don't know. And for those of you watching on YouTube, I am wearing Chico's Bail Bonds t-shirt. Now, where is that from? That's from the Bad News Bears, a mid-70s. Of course, I'm aging myself because we have the Bad News Bears running the American government. And I thought Chico, who sponsored the Bad News Bears, these are bail bonds and there's the Liberty Bell there, let freedom ring. We have a bunch of bozos running our government and it's distressing to me.

38:20Anthony Scaramucci:Yeah. Too many questions about why America went in. Too many questions about why it didn't plan for some pretty basic things like oil prices going up and people getting caught in the Middle East and water desalination plants getting struck. And then we haven't even got into the idea that there could be longer term repercussions. You could destroy the regime. You can take away their military capability now. But the people I have spoken to in American and in European intelligence have said what really worries them is the longer term ramifications of this. Do you still have a terrorist cells that the Iranians have?

38:54Anthony Scaramucci:Like you said, they've been planning for this for years, that they still have those in positions around the world and it doesn't take much for them to do an awful lot of damage.

39:02Katty Kay:Exactly.

39:03Anthony Scaramucci:Okay. Week two. Week two, we'll see where we are at the end of this week.

39:07Katty Kay:So, Kati, before we end, founding members. founding. Okay. Well, we'll see you on Wednesday for episode three of Becoming Trump.

39:17Anthony Scaramucci:This is a very good episode because I think a lot of this episode deals with when he starts flirting with politics. What was it that drew him into politics initially when he was looking at something called the Reform Party? Was it purely transactional because he thought it would help his business and his brand? Is that why he started doing it? Is that why he's doing it now? And I think you also see in that episode some of what you are seeing playing out right this week, which is that belief that he alone could fix it and that he never made a mistake. You never admit to a mistake. So even you saw that with the school.

39:55Anthony Scaramucci:If Americans bombed that school, which is what the video footage looks like, that these were Tomahawk missiles, that is why the president is blaming somebody else. And it's something he learned right from from when we looked at this in the 70s and 80s and 90s. So it's worth a listen. That comes out later this week, episode three. And if you'd like to listen to the whole series, do sign up at the rest is politics, us.com to become a founding member. We'd love to have you in the club. Thank you guys. Thanks very much for listening. We will be back later this week, of course, for all of you with more of what is going on in the States.

40:26Katty Kay:Thanks guys. See you later in the week.

40:42Anthony Scaramucci:Hello, it's William Drimple again from Empire. Here is a clip from our recent six-part series on Mao Zedong. The Greatly Forward was supposed to be, on its face, a kind of highly rationalised bureaucratic system of working out what China could produce and then, you know, working upwards so that you would produce, you know, enough food for everyone to eat and crops that could then be exported to increase China's GDP. and everything would be great but basically because all the figures are being fiddled by officials who are too terrified to give the real information in case they get arrested or you know kind of fired from their their jobs they pass on statistics upwards saying yes it's all going great and we're kind of producing huge amounts of grain and products and up you know in the cities and then you know beyond that to beijing the guys at the top are saying oh well this is great well in that case we can export lots to the soviet union so you have the kind of obscenity of out in the countryside there isn't enough food for people to eat while the grain is being seized and exported from the country to bring in money for the state this is very much a rural phenomenon and that's significant because of course shortly before this the system which still exists today was started up in china a sort of soviet style internal passport system it's called the hukou or household registration scheme and it basically means that you can't just simply wander around wherever you want in china you have to sort of have internal permission so people in the cities were no longer really kind of interacting that much with the countryside they're kind of almost separated off and while people in the cities you know found there was a certain amount of deprivation the devastation was really out in the countryside where essentially it turned into mass starvation about 1959 1960 uh 61 it became clear in the countryside there simply wasn't enough food to go around but when the news came through to the top leadership including mao he basically chose to ignore it didn't exactly deny it but he basically said well you know we need to keep going and he said something like, if things are not going so well, then let's just not say anything about it and keep going.

42:33Anthony Scaramucci:And that led to one of the great confrontations of that period, which is the conference, Communist Party top-level conference held at Lushan. We hope you enjoyed that clip. To listen to the full series, search Empire World History, wherever you get your podcasts.