Bonus episode: Epstein tried to befriend me

0:00The State of It USA has now launched. That's with my brilliant colleague Katie Balls in Washington and Jerry Baker in New York. And I urge you all to listen.

0:16Hello and welcome to the State of It USA, the podcast with the same take on US politics. I'm Jerry Baker, editor at large, The Wall Street Journal and Times columnist here in New York City. And I'm Katie Balls, Washington editor and columnist for The Times and Sunday Times. And I think it's fair to say that we try to give a transatlantic view on this extraordinary, extraordinary events here in the United States. And I don't think probably we've had a more transatlantic story than you could possibly ever imagine. And the story that's broken in the last few days around, of course, Lord, formerly Lord, now just plain old Peter Mandelson.

0:52You'll have seen all the extraordinary stuff about leaking cabinet secrets to his dear friend Jeffrey Epstein in extraordinary ways. We're going to try and understand the lessons here, what it tells us about politics, what it tells us about the world economy, if you like, and what it tells us about the way the world works. But Katie Balls really had quite a scoop in the course of the last week because she actually interviewed Peter Mandelson both before and after, immediately before and immediately after these extraordinary revelations. Yeah, it's a slightly surreal couple of weeks thinking back on it.

1:25I've been talking to him about a sit down interview, really going into what had happened. And we eventually agreed that I would head to Wiltshire. And I was already back in the UK to interview the Speaker Mike Johnson, then to go to Davos. So I went on a Sunday, it was the 25th of January, to his house and basically spent most of the afternoon there. You know, there was a photo shoot. Many have seen the photos. Sat down for lunch for him and his husband. Very nice pink rollneck sweater, I seem to recall he was wearing. Yes. And really had a series of conversations that afternoon with the aim to be writing a long form magazine piece.

2:02That was going to press on Monday of this week. The final edits are around lunchtime UK time, which is about 6am over here. So it filed an initial version on the Thursday. And then on the Friday, of course, we had the latest drop of the Epstein files. Three million files. The Department of Justice saying this is the final tranche. I think some are saying, will it ever be the final? It feels as though there's always more information. But since then, obviously a huge number of files, but it became clear quite quickly that Peter Manelson is in many of those. And the picture has become clearer as the days have gone on.

2:37But from Friday, for example, quite quickly, one of the things that emerged was that his partner at the time and now husband, Ronaldo, had taken money from Jeffrey Epstein to fund an osteoporphyry course. Then in the days that followed, statements emerged, which appeared to show Jeffrey Epstein giving Peter Mandelson money,£75 ,000. Then more details emerged suggesting Jeffrey Epstein was lobbying on bankers bonuses and Peter Mandelson was replying to that. and this is all around the time of Sunday. So I'm staring at an interview which was very extensive and in a way, even on that Sunday, we touched on some of the main themes we're talking about now.

3:17So we talked a lot about Epstein. But one of the things I put to him was, you know, as you say, cast out many times has often found a way back, but often it's because of questionable associations with the rich and powerful. And I said to him in Wiltshire, you know, do you think you have a problem when it comes to judgment applying to yourself? And he said, it's easy to say. And I said, what about specifically with the rich and powerful? And he gave me quite a long answer on how he didn't think the reason he has had so many run-ins or associations with the rich and powerful was that they were rich or the size of their bank account.

3:52He said it was actually, you know. They were just fascinating people. Yes, yes. Exactly. He said rich and powerful. What is it you saw in the billionaire Jeffrey Epstein, Mr. Mendelsohn? Well, quite, because he said when it came to these people, it was not about the bank account very specifically. And obviously, this is before we start getting statements about his bank account in the Epstein files. This is a pre-conversation. So I said, well, if it's not money, what was it about Epstein? And he said he was a sociopath. He was charming. He was clever. He reeled him in. So parts of that conversation still felt very prescient to me when more information came out.

4:25But of course, I then needed to go back to him because I was looking at something and the events had moved. And even after we went to press, the events moved further still as more information came suggesting serial leaking. The police are now involved. But I spoke to him a few times on the Sunday, a combination of messages and phone calls, including after he had just quit the Labour Party, which was late at night in the UK, kind of early evening here in Washington, D .C. And he was still talking as though there was a potential future for him. so he said you know it was a painful decision but he felt relieved and because he needed a reset and I think you know obviously as things have followed that reset is now looking like some really difficult questions and the police being involved and then also I think when it came to when I spoke to him a little bit earlier on the Sunday before he quit the Labour Party I put the several specific allegations to him that had come out at that point and not everything had come out so i couldn't put for example some of these potential leaking things to him but um i asked him about you know bankers bonuses for example saying you know well lots of people will say that you know you're basically open to bribery because of some of this money and and he said well everyone was talking about bankers bonuses there was a widespread conversation at that point with the financial crisis and he described the idea that he he or anyone would change their views on banking policy because Ronaldo, his partner, received money for a course.

5:52And he said Ronaldo thought this was a bursary that Jeffrey Epstein would do things of. He said it was risible, that idea. So he was still, I would say, quite defiant, fighting the allegations and talking about the future. I mean, it is, first of all, it's just extraordinary that he's defiant. And secondly, that he continues. One of the striking things about this to me, he knew about all of these, I mean, I know he claims he'd forgotten about a lot of them and he's deleted his emails. He describes it as if it's almost a blurb. I mean, he must have known, he must have had some recollection of how close his relationship with Jeffrey Epstein was when he was nominated for the ambassadorship.

6:26You know, we've all been in situations where we, you know, we've got secrets, right? Well, you know, nothing on that scale, in my case. But we've got things and we kind of, oh, my God, if this comes out, this is going to be awkward. And what the shocking thing is he just, you know, knowing this, knowing the stuff he'd done and the, you know, again, the, you know, letting Epstein know about these big government plans during in the middle of the financial crisis, which really is an extraordinary. If it's true, and we obviously have to stress we've only seen part of the emails, but if it's true, it's an extraordinary breach of ethics, at least, if not conceivably the law.

6:56and yet he's sitting on all this and yet somehow he's still, I don't know. I mean, I don't know whether to be horrified or to be in awe of the kind of self-belief that you must have knowing you've done these things and still thinking that you have every right to be a major public figure dispensing advice and diplomacy and everything else that major public figures do. I don't, maybe there's something just that I just don't understand about human nature, but I just don't understand how you can not, first of all, just want to go and hide in a corner and at least be prepared to acknowledge that you've done some pretty bad things.

7:33Yeah. And he I mean, he did speak about regret in terms of his association. But obviously, when you get to all the specifics, it was often just he doesn't remember that or that. And I mean, did I think he seemed humbled by the crisis? I mean, he described it as a life changing crisis. He said that and this was in Wiltshire so this was talking about the crisis up to that point but he said it felt like um being killed but then not dying when the initials files broke and he left that role and I think when it came to the the emails leading up to that point yeah he was talking as though almost it was a a technicality because that chapter was a life had already talked about and if those emails hadn't emerged and still be in Washington.

8:16So he clearly longed for that kind of old life and that position he had. But yeah, you look back on that day in Wiltshire and it feels like a different world, if I'm being honest. We should talk about, obviously, the US side of things. And we'll go on and in a minute, I want to ask you about the Clintons. All these names are in the Epstein files in this latest thing. We've learned more about so many more people. I tell you what, my take here about Mandelson, about the Clintons, about what we're learning more about Bill Gates, some of the kind of fairly gross stuff that we're hearing about all of these, but very gross stuff about all these people is, a lot of the focus of the story has been on Epstein himself and his despicable, depraved character and behaviour.

9:02No one's going to challenge that. But I think not enough attention has been given really to the wider context here. It's less a story about a very bad man, Jeffrey Epstein, which it is. it's more a story to me, what really interests me, and I think which is the larger implications of this, is a story about the way modern capitalism works and has worked since the post-Cold War, since the deregulation of finance. The UK and the US in particular are dominated by finance. We are financialised systems, financialised economies, City of London, Wall Street, you know, these are the most important industries in both countries, particularly in the UK.

9:41And the liberalisation of that that exploded in the 1990s, early 2000s, it's no accident that someone like Epstein came along. Because what Epstein did, you know, again, set aside for now the disgusting, illegal, appalling crimes. What Epstein did was he was a genius at bringing people together, at networking. I met Jeffrey Epstein, talked about this in the past briefly. When I was editor of The Wall Street Journal, it was at a film premiere. I was introduced to him. I knew this was in 2015. So after his first conviction, I knew all about him, didn't want anything whatsoever to do with him. He was incredibly, yeah, he was charming and all of that, as Mandelson says.

10:24Did he make a beeline for you? He didn't make a beeline. We had a very brief chat at this premiere and, you know, he was there with a very young girl. I can say that. I was there with my daughter and, you know, I was eager to protect her. But I wanted nothing to do with him. For weeks afterwards, Katie, he tried to get me to have lunch or dinner or meet with him. And he would keep saying, you know, oh, I've got really interesting people. I've got Woody Allen and Sunyi Previn coming for dinner. Please come and join us. Or I've got, you know, the head of, you know, an investment bank or people like, you know, he was brilliant at bringing people together.

10:58And, you know, he didn't bring Peter Manilson or any of the – frankly, I don't think he brought the Clintons or Donald Trump into his orbit by saying, you know, come and meet my harem of adolescent girls. You know, what we know about Peter Manilson, we know that wouldn't have appealed to him anyway. But I don't think that's what he did was he said, you know, come and meet the top counsel at a major investment bank. Come and meet, you know, a hedge fund person. And he would connect these people. He would bring them together, which is where all this work gets done through these connections. And, you know, that I'm not saying it's even wrong, but I'm saying it is a really interesting insight into the way that modern capitalism works.

11:36And the money, Katie, the money is just, again, thanks to the financial economy that we live in, is just astonishing. And so, you know, we took so that talks about, you know, 70 ,000, 70 ,000 pounds or 10 ,000 pounds. The most interesting stuff is Mandelson, as we now know, was in negotiations and Epstein was helping him to get a job when he left office, which would pay him millions and millions of dollars a year. That's what it was about. The money, bringing people together who had connections, politicians had good connections, and in exchange they'd get money. And that's what this story is fundamentally about.

12:08It's about the way in which financial capitalism works. It's so interesting what you're saying there, because when I was pressing Peter Mandelson in our original sit down conversation on, you know, what is it about these people? And he said, it's not the money. And he said he was, you know, a sociopath. He was very charming. And then he said, and then he gave us an example, these dinner parties. He said he had been to two dinner parties with Jeffrey Epstein and Bill Gates had been around the table. He said Noam Tronksky was at one of them, but he didn't want to speak to him because he was, you know, a Blairite.

12:38But he listed, you know, he said the head of Google was there. He was listing all these people. And I think it speaks to exactly what you're saying, which is it was almost the access to this people and this feeling of being around this room with interesting people, which was clearly part of the draw and a reason Peter Mendelsohn kept going back. All right, let's very briefly talk about the Clintons, because they are going to be testifying initially. They were in a standoff with Congress. They've now agreed to testify. Do you think we're going to learn anything? They're testifying later this month.

13:06You know, obviously the man, everybody, I think it's fair to say, wants to be exposed in these release of documents. Donald Trump still keeps sort of walking between the raindrops, as it were. My feeling about Trump is that by good luck or good management, Trump, for whatever reason, actually didn't have pretty well anything to do with Epstein after his 2009 conviction. So I think the constant search for the smoking gun that's going to expose Donald Trump as being involved in Epstein's crimes is just not there. But what do you think about the Clintons? I mean, how's that going to play out? So I think a couple of things are really interesting about this.

13:38And I was out in D.C. on the evening the news broke that Bill Clinton and Hillary Clinton had decided they would actually testify. And all of a sudden, the group I was with, which included some lawyers, all started going on their phones and calling each other. Now, the Republicans have been pushing for this for a long time. And I think that it speaks a little bit to how Trump has, in a way, got through the Epstein crisis. and people will say he still has questions. But to your point, for a long time, it's been talked about as the Epstein crisis, the thing that could bring Donald Trump down. When Elon Musk fell out with Donald Trump, now they're back in one another's orbit.

14:19But when he was very angry, he took to his social media platform X and he said, the reason Donald Trump won't release the Epstein files, he's in them. And it was clearly used as something which could, you know, was it Donald Trump's Achilles heel? Turns out Elon Musk was also in the Epstein files. But the Bill Clinton aspect, we saw because these files have been released at different stages. When the Department of Justice was eventually really compelled, they had to release the files because of the Act of Congress. The first batch, we were all sat there. I remember I was in Arizona at a turning point.

14:51We were all refreshing. And then when they were released, people were searching for Trump and he was just not in them. And it was all about Bill Clinton. So clearly this is the area where the Republicans feel as though if they had to release them, a plague on both your houses. We're going to bring as many Democrats down with us as we can. So I think the Republicans are very pleased that they've managed to force the Clintons to appear. I think that, you know, will this be an embarrassing appearance for both of them? We expect it to be near the end of the month, I understand, and two separate days rather than them appearing alongside is the current thinking.

15:22But, I mean, both Hillary Clinton and Bill Clinton are pretty well-trained public speakers. And I don't think it's going to be a pleasurable experience for either of them, But you can imagine Bill Clinton being fairly deft in the way he is going to go about this. And will we see answers along that? Yes, but also Donald Trump. I wonder, you know, do they try and also put it back in that sense? But the other thing I'd just say before we move on is I've just been really struck having obviously recently been in the UK and working for a UK newspaper, but being based here and just how much focus the Epstein files have got in the UK when it comes to UK politicians, Peter Manderson, Andrew, formerly Prince Andrew.

16:02I was out with people on the Hill last night and they were just saying that they feel as though it's much more the Brits who are facing the consequences of their actions than perhaps some of the Americans. I don't know what you think, but that's true. Yeah, I have some thoughts on that. I mean, first of all, no. I mean, the most important thing I'd say is the only reason this Mandelson story has come out and frankly, what looks like appalling behaviour, particularly related to his time in government and during the financial crisis, is because the United States Department of Justice released these files.

16:34This happened 16 years ago. The crack core of British journalists, most of whom happily supped with Peter Mandelson and loved, you know, hearing the honeyed words fall from his lips time after time after time and idolized him as, you know, the architect of New Labour and one of the greatest politicians. I could point back to even as late as when he was appointed as ambassador to Washington last year, all these lionizing articles saying, you know, what a genius he was, all of this stuff. No journalist in Britain, you know, for all this talk of accountability, no journalist in Britain discovered that what he was up to when he was in the government.

17:13And, you know, frankly, so for the British to sort of say, oh, we take ourselves much more seriously and we take these things more seriously, I think is unbelievable, pompous self-promotion. And the second thing is, and again, I just said it, there have been there's been fallout here in the US for people. We've seen it with finance people. We've seen it. Bill Gates has been disgraced, essentially, because of what's happened to him. Senior people on Wall Street have had to move into the shadows and disappear because of what's happened to them. Larry Summers, the Treasury Secretary under Bill Clinton, top Democrat, president of Harvard University, has been disgraced.

17:48disgraced. So many people have actually been exposed by this. What I think these journalists mean or these people mean when they say, oh, it's been more fallout in Britain than it has in the US is they haven't got Donald Trump. And I come back to my point again, I'm not defending Donald Trump was a big buddy of Jeffrey Epstein's for a long time. But, you know, I'm pretty confident. And, you know, we've just seen three million documents released. There is not a smoking gun. If there were a smoking gun about Donald Trump, the idea that the Biden administration, which had these documents for four years, would have sat on that smoking gun and would not have released it is just utterly absurd.

18:28So when people say, oh, there's been more fallout in the UK than there has in the US, it's not true. There's been a lot of fallout in the US. But what they mean is we haven't got Trump. And they're not. I don't, you know, I am willing to stand corrected should some revelation come out. But the evidence isn't there to, quote unquote, get Trump. So I find this kind Kind of, you know, why is it all happening in Britain but not in America to be, you know, frankly, a little bit unconvincing. Anyway, we have to take a break there. That's enough Epstein, I think. We'll doubtless be coming back, I suspect, to Epstein in the coming weeks.

18:59That story is not going away. I should also say, of course, that while many people have been significantly embarrassed by the revelations of their appearances in the Epstein files and their relationship with Epstein, In almost all of these cases, no crimes have been alleged. Jeffrey Epstein and Ghislaine Maxwell themselves are the only ones who've been actually charged with a crime. So I just want to stress that association with Jeffrey Epstein is not intrinsically, of course, evidence of any criminal activity. So when we come back, we will leave Epstein alone. We'll talk about some other things that have been going on here in the US, particular Donald Trump's call that he's had in the last week for the Republican Party to take over the midterm elections, sending some shivers down the spine to some people wondering what that might mean for those elections.

19:43So stay with us. We'll be back after the break. And we're back. Now, Gerry, another story, if you move away from Jeffrey Epstein, is a call Donald Trump made this week about nationalising the voting. Can you tell us what exactly he means by that? Well, it's an interesting question, Katie. He called, as you're absolutely right, as you said, he called for the Republicans to take over the voting in particular states. These are the midterm elections, crucial elections. They're always important, but they're probably even more important than they've been in many years this year. The background, obviously, Republicans control the House of Representatives and the Senate with narrow majorities.

20:16All the seats in the House are up for election in November. A third of the Senate, the Republicans, as it stands, look very likely to lose their House majority, could lose a Senate majority less likely. But that would be a big deal if they lose. If the Democrats take over, they'll almost certainly move to impeach Donald Trump. They'll block everything he wants to do. So the stakes in this election are probably higher than they've ever been. and Republicans are nervous. Donald Trump is very, very nervous. And two things happened in the last week, which have concerned people. One is at the end of last week, the FBI raided a warehouse, essentially, in Atlanta.

20:49Atlanta, Georgia is one of the crucial swing states in elections. He had the FBI, they had the FBI raid the warehouse where they keep the ballots relating to the 2020 election, the very disputed election, of course, the election that Donald Trump insists he won, even though he didn't. And of course, everything that led to January the 6th. So he's cool. He said the FBI and remarkably, he actually also Tulsi Gabbard, his director of national intelligence, was there supervising this raid. Trump, it was revealed later, spoke directly to the FBI agents to thank them for this. Now, they claim that what this is about, they say this is all about investigating what they claim to be fraud in Georgia, which was a crucial state again, as I say, that went for Joe Biden in 2020.

21:29But what that did is it also really alarmed people about, you know, if Trump is sending in federal agents to take over voting records, voting machines, does this represent a serious interference, an attempt maybe to send a signal about Trump's and the Republicans' plans to maybe interfere with the elections this year? And then that was compounded by, as you said, he talked about nationalizing the elections in some remarks later. Now, again, just for, you know, background, those who don't know, the election process under the US Constitution is a state responsibility. There isn't really a federal role in elections.

22:05States, even elections for president, are matters for the states. The federal government does not have the right to intervene. So this is putting a lot of people on edge here, wondering whether in their attempt to forestall this defeat that currently looks likely in the polls, whether there's going to be direct intervention, you know, maybe in the vote counting, maybe purging voter rolls, exam, you know, or any kind of measures, which I think people are, given Trump's behaviour, I think legitimately concerned about. Everybody's been, you know, on edge about will there be some attempt to interfere in the election process?

22:41Will it be a fair election in November or not? It's pretty hard to do it. But if you're a suspicious mind, and if you think that Donald Trump is about to try and, you know, sort of end democracy in the United States, this is something you're paying particularly close attention to. And, Gerry, just on that, I mean, if we think about those midterms, we've also had all these rows of gerrymandering, redistricting. There have been efforts from the White House for a while now to try and stack the decks or move the playing field in a way that is beneficial to the Republicans. But so far, they seem to have just had not much luck, Republicans fighting back, saying they weren't comfortable with some of the things that Donald Trump wanted to do.

23:18And the Democrats, Gavin Newsom, for example, almost beating them at their own game. Right. And look, it's important to say that, you know, All the indicators are bad for Republicans right now. There was a special election, as they call them here, kind of a by-election in a state Senate seat in Texas last weekend. Texas often votes on Saturdays. This was in a district that Trump won, I think, by 17 points in 2024, just 18 months ago. The Democrat in this seat won this seat by double digitizing. It was essentially a kind of a swing, depending how you want to measure it, but a swing of 25, 30 points in a deep red district, as they call it, a Republican district, where Hispanics voted in quite large numbers for Donald Trump last time, seemed to have deserted in this time.

24:03All of the polling evidence we have, all the evidence we have from these special elections and others is that this is shaping up as we stand. And we're still nine months away from Election Day. So it's shaping up to be a pretty significant rebuff to Trump. His polling numbers are terrible. He's turned immigration, thanks to some of the things that people have seen in Minneapolis, from a great positive, a great plus for him into a real minus. People are still worried about the economy. He's going to supposedly focus more on that. I think people have not been happy with some of the things he's been talking about in terms of, you know, NATO and Greenland.

24:36So he's he's the Republicans. I've spoken to a couple of Republicans in the last couple of days. They are very, very nervous about these elections and just about whether this could turn out to be a really consequential defeat for them. Obviously, things can change. But as it stands, things look pretty grim for the Republican Party. But much more importantly, Katie, you have, as ever, been continuing your whirl around the social scene in not only in Wiltshire and sunny Wiltshire and England and Davos, where you were, where we both were a couple of weeks ago, but you've been obviously back in Washington and you've been doing some terrific reporting, but also having some fun, I think.

25:12In Trafford reporting through the DC party scene, which is, we spoke briefly last week about the Melania premiere and the release of the first lady's film.

25:23hi mr president congratulations did you watch it i did not yeah i will see it on the news i didn't manage to get into the official premiere but i did at least make it to the after party and this was at the ned which is a members club in dc and it was largely people who had been to the premiere shockingly also into the after party so i was speaking to you know figures in the administration close to the administration. People who are largely supportive of the first lady and her husband was the guest list here. And I did go and see it in the cinema the next day, complete with Melania-branded popcorn that they were giving out.

25:59But anyway, people were all saying how brilliant the film was. There were lots of very glamorously dressed women and mini cheeseburgers going around. Very few were being eaten. I made straight inroads for them. But it was a theme which you then saw play out because we have seen with the Melania film, lots of people in advance saying it's going to do really badly. It's going to be a turkey, which in a way has allowed the White House and Melania's team to then say, well, you all said it was going to be a disaster. Actually, it's made more money than most documentaries do in its first week. We then had the news in the few days after that, after this huge premiere of Melania's face was ever at the Trump Kennedy Center, that the Kennedy Center is actually closing for two years.

26:41And they said this because it needs refurbishment. I think if you speak to Democrats, but also Republicans, everyone's saying that's not the real reason. It's because they have changed the Kennedy Center in a way that they're now, the Trump Kennedy Center, in a way that they're now struggling to get performers. And this is perhaps a face saving measure. What do you think? Yeah, I mean, it's pretty obvious that there has been a dramatic fall off in people wanting to perform at the Kennedy Center. The most striking one last week was Philip Glass. You know, This is the 250th anniversary of the United States.

27:15He'd composed some special music and was going to give a concert at the Kennedy Center. He pulled out after what Trump has done with renaming the Kennedy Center the Trump Kennedy Center and taking it over with his own team. Look, the idea was supposedly that they would make the Kennedy Center a much more popular. Should we say, well, you remember what Trump said? It would be less Hamilton, I think, and more Les Miserables. And to be fair, it was for years and years and years full of endlessly self-serious, woke, progressive kind of nonsense that, you know, the Kennedy Center Awards every year would be these kind of like the Oscars.

27:55Well, the glitterati of the kind of progressive musical artistic crowd would come along and say how wonderful they all were. I've got to say it was kind of slightly tedious. But Trump, you know, tried to overturn all that and turn it into kind of Lee Greenwood and, you know, singing proud to be an American and all that stuff. That didn't really seem to work either. So the numbers have dropped. The face saving device is that he's going to make a major overhaul. But, yeah, clearly his cultural overhaul, shall we say, of the Trump Kennedy Center and indeed of America has a way to go. That, I think, is it, though, for this week.

28:29Katie, thank you all for joining us. We will be back again next week with another episode of The State of It USA. See you next week. Goodbye.