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GoodFellows: Conversations on Economics, History & Geopolitics
Complicated Legacy: Jay Bhattacharya on Fauci, RFK, and Vaccines
01:08:04
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- [00:00]
H.R. McMaster
Can you explain to the committee why you chose to fund this dangerous research in China?
- [00:07]
John Cochrane
On the advice of counsel, I respectfully decline to answer based upon my rights under the Fifth Amendment of the Constitution.
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Neil Ferguson
I'm Neil Ferguson, a senior fellow at the Hoover Institution. And no, don't adjust your devices. Bill Whelan's off this week, so I am sitting in his chair as moderator. However, my fellow goodfellows are also here, and they are the one and only H.R. mcMaster and John Cochrane, who are also senior fellows here at Hoover. Hi, HR And John. Our guest today used to be a visiting fellow at Hoover, but he got an even better job last year. Dr. J. Bhattacharya is the director of, of the National Institutes of Health and I think the acting Director of the Centers for Disease Control and Prevention. Welcome, Jay. Or should I say, welcome back.
- [01:07]
J. Bhattacharya
Nice to be here, Neil. Although it's an open question whether those jobs are better than being a professor at Stanford. We'll see over time.
- [01:16]
Neil Ferguson
We'll get you to comment in more detail on that later on. I want to take you back in time to your last appearance, which was November 9, 2021. Back in those days, you were just a mild mannered academic like the rest of us. And the conversation then centered around, well, an assortment of COVID related matters. Remember Covid viewers, that pandemic that we've all kind of stuck in the memory hole and one of the things we talked about was Anthony Fauci's performance as head of the the National Institute of Allergy and Infectious Diseases. I think it's probably an understatement to say that at that time Jay was notorious famous to me as a skeptic about much that Dr. Fauci advised us all to do during the pandemic and in some cases required us all to do so. Jay, can we start with an update? Is it fair to say that just about everything we've subsequently found out about COVID has vindicated you and other skeptics of lockdowns, school closures and other measures? Or to put it really simply, was the Great Barrington Declaration. Right. After all,
- [02:34]
J. Bhattacharya
I mean, this is one of those things where, like, it's hard. I mean, yes, I think most, mostly right. I think that the thing is it's kind of a cheat, Neil, because the great branch of declaration, it argued for focused protection of vulnerable elderly people based on the epidemiology of the virus, which is that it really killed older people at much higher rates, orders of magnitude higher rates than young people. And then that the, that There really were direct harms from the lockdowns, the school closures, which are palpable. You still see them echoes of that today with, with. So that was the standard wisdom in public health. The fact that it was controversial at the time is still a stunning thing to me. But yeah, I think we've seen now the wisdom of that approach, which wasn't really novel to me. It was really, it's like I said, age old way we handle public health. And I think the, I mean, you couch this in the context of Dr. Fauci and Tony Fauci, who I guess would have worked for me if he had stayed on at the nih. I think his is going to be a very complicated legacy. I think he had a really positive role to play in the HIV epidemic which continues to this day. But over time, he made some decisions I think were very questionable, both about dangerous gain of function, which. These are research agendas that may have actually led to the pandemic eventually coming. Not specifically directly, but in terms of, like the research that allowed experimentation on viruses in ways that probably shouldn't have been allowed. He authorized that, oversaw it, advocated for it. And then during the pandemic itself, he played a very leading role in public health, which is actually an odd thing for a head of a research institution like NIAID to do. Like I, I sit as CDC direct acting CDC director and NIH director. That's never happened in history. It, frankly, it probably, you know, it's, it's, it's. Those are two different missions, research and public health. He didn't have both those missions. He only had research. And I think he abused his position in many ways. That's come out since the 2001 interview we had together that, I don't know. It's a source of a lot of consternation for me because I'm advocating for the continued the relevance and importance of the NIH as an institution to advance American health. You have that history of Tony Fauci's actions during the pandemic and before. It makes it much harder.
- [05:22]
Neil Ferguson
You're probably too busy to read extracts from his diaries that Senator Rand Paul has made available. Any, Any thoughts on what they're revealing?
- [05:32]
J. Bhattacharya
I read it's 1100 pages, so I'm not, I've not read through all of them, but I, But I have a friend sending me. Every time they find a nugget, they send me a nugget and I'm almost at a loss for words. There are places where he directly attacks me, like, just leave that Alone. But more broadly, the way that he approached public health and the way that he approached science left no room for debate or discussion. He was the science. It actually wasn't scientific in one sense. It was an argument from authority on things where he really didn't have the sort of institutional role or expertise really to make judgments. And as a result, there was all kinds of instances where it seemed to me, from reading the extracts that were sent, that he would. Were saying things publicly that he didn't believe. Like the very definition of hypocrisy. Right. That the public role would say that it's conspiracy theory, that dangerous gain of function might have caused the pandemic. And the. The private notes would say, well, nine of 12 scientists that I brought in told me this might be the case. And you see this over and over again on school closures, on mass, on social distancing, a whole host of things. There's this sense that he was playing a role, a public health role, conveying very confidently things that maybe he himself didn't even believe. If I'm believing the diary. And I just. It's just heartbreaking. It's heartbreaking to think about what might have been if someone with a little less sense of hubris had been in that position, had been a little more circumspect in how he communicated the really conflicting data. I mean, it was really hard to tell exactly what. Because it takes time in science to develop sort of an idea about what we actually believe as scientists together. And so he was conveying certainty. And as a result, millions of people's lives were fundamentally altered, often for the. For the, like, the worst, I think, especially school closures, like the intervention that he did for school closures in 2020 led to now millions of school kids, not just in the United States, because his, his words had residents around the world, millions of kids being deprived of basic right to an education that they had. And they're still paying the cost of that. Yeah. Anyways, it. It's a painful subject.
- [08:13]
John Cochrane
Jay, Let me, let me ask this. So it's fun to make, you know, Fauci's kind of in the news. And respectfully, I declined to answer on the advice of council. You know, this is fun, but it wasn't just one guy. You know, Deborah Briggs was in it. The entire science community was in it. You and Scott Atlas were canceled by your colleagues at Stanford, by all the large medical and public health institutions were all in on this. And it clearly was some politics. It was kind of funny when before the election, Republicans were for vaccines and Democrats were against it. And then the election changed and all of a sudden, whoops, we changed sides on vaccine. So it's not just the arrogance of one man, it's the. A whole set of institutions jumping in and doing it. It's not just the silliness of masking screaming 2 year olds playing outside in a playground. Perfectly obvious to everybody this was a stupid idea. But it's also the censorship which you experienced. The censorship from the government, the, the Twitter files, the cancellations, the universities. So in your job as interim CDC director, I had to go look up exactly what you do. The nih, the CDC and the FDA are parallel. I wish you were in charge of it all, but you're not. But apparently you have a little say at the cdc. What worries me most is the next pandemic, the catastrophic failure of trust not just in the science, but certainly in the institutions of science, which went all in on the last one. In the institutions of the cdc, the next pandemic will come before we're ready. This one might be different. It might preferentially kill young people like past ones have. It might have a 10% fatality rate, not a 0.2% fatality rate. The utter incompetence of these institutions will lead people to just ignore all advice. How do you put that all back together again?
- [10:31]
J. Bhattacharya
Yeah, I mean, so let me first take it from the most important thing from a personal point of view. Please don't wish the FDA on me. I'm not getting much sleep now, and I'm looking forward to handing the CDC off to Erica Schwartz, who's going to be an expert CDC director. So, so that's, that's first. But I do appreciate your confidence in me, John, on the, the scientific community. I agree with you. Wasn't just Tony Fauci. I mean, I think he's the. It's very easy to point to him because he pointed to himself, right? He went on TV and said things like, you know, if you, if you, if you question. I'm paraphrasing. If you question me, you're not simply questioning man, you're questioning science itself. Right? So someone like that, who takes on himself essentially this, the sort of like high ecclesiastical authority within the context of the scientific, you know, sociological structure, it's easy to point to him. But it's the structure itself that's the problem. And in fact, this has been at the heart of what I've been thinking about my job at the nih, what I'm really about, what I'm trying to do is reform the scientific community by making how we decide what's true really focus on replication because it's essentially democratization of an epistemological power, right? Rather than having high authority that gets to decide what's true in science. A top journal editor, a fancy professor, NIH director. Instead it's what does the scientific data actually say? That may sound surprising, John, but I'm sure you've experienced this as well. You can see this even within economics sometimes. What does Paul Krugman say determines what's true in economics? Well, we say no to that because we say, okay, we're going to have, we actually look at the data. We can have a scientific fight. The Chicago tradition is all about that scientific fight, right? In science it's the same problem, except that it's often it's not so public. Right? But it became public during the pandemic. You had Tony Fauci getting to side items of vital interest to the well being of everybody on scientific matters. And then all of a sudden all the scientific community falls in line underneath him. That points to a sort of six scientific culture. A scientific culture that doesn't value replication, that doesn't value sort of the, the, the, you know, the junior scientist who finds a very inconvenient piece of data that overturns the whole thing. I've been working very hard at the NIH to reward that kind of structure because I think that's the long term solution to the problem you identified.
- [13:18]
Neil Ferguson
So Jay, I want to talk a bit about your analysis of these wider problems. When you were being confirmed, you set out five crises in the domain of the nih and it's kind of a good opportunity to check in now and see how it's going. Let me start with the first of these crises you identified with which was a chronic disease crisis. And you said, quote, american health is going backwards. Life expectancy flatlined between 2012 and 2019, plummeted during the pandemic, still hasn't bounced back to pre pandemic levels. This is all during your confirmation hearing back March last year and you said you were going to make NIH focus much more on addressing this chronic disease crisis. How's it going?
- [14:14]
J. Bhattacharya
So substantively we have actually started to see increases in life expectancy and actually is probably the most likely reason why has to do with something the NIH did a long time ago, which is these, these GLP1 drugs that have reversed the increase in body weight that goes back at least 80 years in the United States for the last two years, there may decline in body weight. And so that has some impact on chronic disease as far as like actually getting the research enterprise to focus on it. We have increased the amount of leeway that the institutes have on addressing chronic disease problems that include things like, you can think broadly about chronic disease, include things like autism. So, you know, this autism data science initiative to allow people to like, focus on, ask research questions regarding the etiology of autism to more fundamental things, things like heart disease, diabetes, Alzheimer's disease. There's kind of a sort of warrant to all of the institute directors that are in charge of the research portfolios there to think broadly and think widely. I'm hoping that the answer to your question will come out over the course of the next few years as we start to see these new discoveries turn things around. I believe it's possible, but you just have to articulate that we're doing it and we're going to do that. Ultimately, I think my tenure as director will be judged 10 years from now based on whether the US is still in the same kind of chronic disease problems that it currently has, or scientific advances have really helped turn those around the way it has with for obesity.
- [15:50]
Neil Ferguson
So I mentioned there were five crises and the one that I find most interesting is what you call the reliability crisis. You said in your confirmation hearing, NIH supported science should be replicable, reproducible. And generally this is a tremendously important issue that we not really touched on much on. Goodfellas, the crisis of replication in the sciences. Explain a bit for our viewers what that refers to and what you're doing about it.
- [16:23]
J. Bhattacharya
Yeah, so I mean, it's actually Niels, it's, it's absolutely shocking when I talk to people who don't, who don't know about this, but it is a fact that a large chunk of, of the biomedical sciences, and unfortunately not just the biomedical sciences, published literature. When independent people look at the same question, they even just narrowly reanalyzing the data that's there, or asking for new data or new approaches to the same question, they often find the different answer estimates. Like in cancer biology, basic cancer biology, 70% of papers are not replicable, or the methods aren't described enough in a way so that a replication could happen and it has real consequences. Not just cancer biology, neurobiology, in psychology, in field after field. Just recently, economics came under the same kind of sort of focus. And the reason is common to all of these fields. The reason is that the way that we judge productivity in every single scientific field, it seems is very narrow and not tied to actually finding truth. We measure productivity based on how many papers you've published and how influential you are as measured by citations. That is not the same thing as I've discovered now we have scientific heroes, we have Nobel prize winners and all this other stuff. But the work a day work of science is rewarded based on those two measures. It's not rewarded based on have I found an idea that transforms a field, that other people, when they look at it, think the same, find the same thing as me. That sort of replicated important idea of being the key measure of productivity in science is not the actual reality in our scientific fields. Instead, what we have is this authoritative structure where a top journal editor gets to decide what's true in their respective fields. Tony Fauci gets to decide what's true in his respective field. Right. And everyone, everyone, so many people focus their efforts in science incurring favor with the top authorities. It's akin to what led to the situation before the first scientific revolution where high ecclesiastical authority got to decide things like do the moons of Jupiter move? And the first scientific revolution was a few people, very clever people with telescopes, they got to decide whether the moons of Jupiter move. So I've been working on that. So the NIH actually is a great place to do that. So one is we are now funding replication work. Two, which is, which then sends a signal to the scientific community. This is important because right now it's not seen as important. Two, we are developing measures and metrics for scientific productivity that include replication and good practices around replication like do you share your data, do you share your code? We just had this big S index challenge where this kind of data sharing, it's a really important thing to be able to point to for science to have is measured and then therefore will be rewarded. Three, we're going to have a journal, a place where you can publish your scientific replication work. Right now you can't, I mean, so the, we'll have an NIH journal working on that. We'll see that hopefully later this year we'll establish a new journal where people can publish their application work and share that with information, with community. And four, this is probably the most important of them. We're going to tie the sort of like search functions for scientific papers. Right now you search for them on PubMed, which is where you search for scientific papers in the NIH or everywhere and you see the journal and you see the authors and you may see the abstract. We're going to add a replication button. You Click the replication button and then you'll get a knowledge graph of all the related papers. And then you'll do a little AI summary of each idea in the paper, what the related literature says. And you can have a comment button where we can disagree with the AI and have a conversation. And it'll put the emphasis on what do other scientists believe about the ideas that you publish? Rather than was it published in the top journal, like a New England journal or something.
- [20:39]
Neil Ferguson
So in a way this illustrates how you can use the sort of power that you have, which has the potential to be ecclesiastical, to empower science as it really should be practiced. Okay, here's the good news. There's one of your crises that I know you've solved, and that's the crisis of scientific dissent. And you must have solved it because there are lots of people attacking you, including the authors of something called the Bethesda declaration, I think 37 pages denouncing your management of the NIH. Is this a sign of success or something else?
- [21:18]
J. Bhattacharya
It's absolutely a sign of success. Right. So one of the first things I did is I issued an academic freedom policy at the nih. So if some scientist comes up with a result that actually used to happen is that you'd have to often get for politically consequential or controversial results, scientists would have to get clearance from my office sometimes in order to be able to allowed to send it out for publication at all under my new Academic Freedom Policy. If your scientist has a result, the only clearance they have to get is based on handicap accessibility and all that other stuff that normally nothing substantive, they're allowed to send it out even if I disagree with it. Right. So I don't want to police scientific results. And then I, and I, and the Bethesda Declaration people, what they want essentially in effect is a return to the status quo anti the nih. Not just on scientific freedom issues, but also on like support for DEI initiatives and a whole other range of things I don't think are a good idea. Yeah, so I just, I just, I've turned the page on that. Is it complete? I mean, these are cultural changes. They take time. Policy point of view. I think I've made my, my position clear.
- [22:35]
Neil Ferguson
So are you probably wondering what happened to hr Because I must be, I must be guilty of suppressing his, his free speech because he hasn't said a thing so far. And, and I, I think it's because we're, we're, we're talking about stuff that's quite far from his comfort zone. But we're, we're about to get to the geopolitics of all of this because you can't talk about gain of function research, which was one of your crises, without talking about China. And I, I'm curious to know what you currently think about the. The Chinese part, not just in Covid, but, but more generally in the field of. Of biomedical research. Because it feels to me as if one of the big changes since 2020 is that the Chinese have vaulted forward in terms of the scale and sophistication of their research. So this is a chance for HR to get into the conversation, because if China's caught up or is catching up in this area, this is a big deal.
- [23:35]
John Cochrane
No, to add to it the lab leak, the who, and China's ability to do stuff much, much cheaper than we do it because a whole lot less paperwork.
- [23:46]
H.R. McMaster
Yeah. And just the context, Jay, you know, of, Of. Of artificial intelligence combined with bioengineering, how you're thinking about that threat, you know, what are the kinds of capabilities that we need in terms of, you know, rapid diagnosis, vaccine prototyping? I mean, just that whole. That whole area of threat that is really centered on, on the prc and the work that we know is now open source. I mean, for many years, you know, we had a classified knowledge of them designing, you know, bioweapons. So, yeah, I'd love to hear your thoughts on what you're doing in that area.
- [24:23]
J. Bhattacharya
I'd also love to get your reaction to HR for what I'm doing, because I think this is one of those areas where the future of the country, and in fact, the future of the world, really depends getting it right, just to set the stage. Because the problem I was addressing or thinking about in the confirmation hearing a year and a half ago is that, as I said earlier, Tony Fauci and the NIH had embraced a philosophy of risk tolerance regarding some very dangerous work. The argument that they made was that you could take viruses, manipulate them, and then make them more transmissible, potentially more dangerous to humans, and then triage them to decide which ones are most likely to cause pandemics. The possibility that that research program might have led to the pandemic is, I think, a very real one. I mean, I know the scientists disagree, but in any case, we as the NIH need to make sure that that doesn't happen again. Right. That. That research program, if there's. You know, when I wrote an op ed just recently in the Wall Street Journal where I made an analogy to what Enrico Fermi did, the Great Italian physicist during World War II. He did this experiment to launch the nuclear age, the first nuclear chain reaction. And he was very worried that what if that nuclear chain reaction doesn't stop, it blows up the world. He did a calculation, brilliant mathematician, realized that the risk of zero, and then he did the experiment. And so the President signed an executive order last year. And now we have a structure in place to enforce it, to ask and basically require scientists to do that calculation before they do any dangerous gain of function. Research in that executive order includes a order for the United States essentially to stop collaborating with our adversary nations on scientific topics. What we did is. Now that's really important from a geopolitical point of view because if you go back 25 years, the US invested a tremendous amount in the biomedical research enterprise of China. In fact, almost every single top biological scientist in China. Their entire infrastructure postdocs involve US government investments. And now they are at a level where they have a fantastic biomedical research enterprise and it's legitimate and they do faster randomized trials than we do. They violate. They have very different ethical standards regarding human substance protection in them, which I think proposes its own problems, but it's a legitimate adversary to us on this setting. Our investments building up their biomedical research enterprise I think are better directed to the United States and to American scientists. You bring up AI, and I think it's a really important question related both, both the Chinese, the state actors involved, and potentially other non state actors. Right. So the AI tools that we have now, if used, have the potential for people who don't to like develop formulas that would allow the development of biological agents that could pose a lot of harm. And, and the question of at the same time those same AI tools have the potential of unlocking scientific ideas that can, that can solve the chronic disease crisis, make people healthier at scale, worrying inexpensively. And so it's a really interesting balancing act hr, to like figure out how to do this right. And the key thing to me is we have to allow the AI tools that exist to have the effect on the good, to protect people from the threat that these kind of AI tools in the hands of actors, I think the key thing there is state actors might be different than non state actors. The key thing there is, rather than regulating the AI, which seems like it's not possible right now to do, it's to regulate the access to the precursors that would allow you to develop those tools in the first place. It's similar to the way we deal with nuclear, nuclear threats. Very difficult to control the Knowledge about how to build a nuclear. Nuclear weapon. Like, you know, there's a, I think a Princeton honors thesis student in, in 1980 or something actually wrote his honors thesis on how to build a nuclear weapon. Right. So that's available to bright, bright people. What's not available is how do you get plutonium, how do you centrifuges, how do you get, you know, those things are not easily available and we use the access to those precursors as a way to like control that risk. I think it's going to have to be some structure like that on AI. I think the dangerous gain of function, risky research policy I think is a big step forward. We're not going to have lab created pandemics based on NIH funding or US government funding again as a result of the structures.
- [29:48]
Neil Ferguson
Yeah, I know we don't have limitless time with you and given that you're doing two jobs still, I just have to ask you and you'll know that I'm going to ask this about vaccines because you said recently you'd see no proof that any kind of vaccine causes autism. And that seemed like breaking with your boss, the Health and Human Services Secretary, Robert F. Kennedy, who's repeatedly cast aspersions on vaccines. So is your relationship under strain with him or are you finding a modus vivendi?
- [30:25]
J. Bhattacharya
No, I, I actually quite the opposite. Excellent. I, I love Bobby actually. I think he's an amazing leader and I've really admired and, and been very, very happy to work with him. Would he is just. Let me just characterize his position as I understand it as carefully as I can. Right. His position is that in many cases and many vaccines, we just haven't looked. Right. The Institute of Medicine in 2016 issued a report that suggested that the evidence based on some vaccines regarding this connection to autism, for instance, has been looked at and not found anything. But that for other vaccines there hasn't really been a look and he's not wrong on some of those vaccines. It's been very difficult to get scientists to ask the question because it's seen as a death to your career, even ask the question. And so I think it is accurate to say that for instance for the MMR vaccine, when I look at the data and literature, this is far from my direct expertise. So if those who are listening disagree with me, send me more data and I'll try to learn more. But I don't see a link. And the best data sets I've seen are the best information I've seen around this suggest that if they, the study would have found a link, but it didn't. So it seems unlikely. That's for mmr, for a whole bunch of other vaccines. I think Bobby's right. There just hasn't been people that looked. And more broadly, the idea that we know everything there is to know about every single drug is just not true. I think we should. And when you have a issue like this where the public, it matters to the public a lot. Our job as scientists is not to judge the public for asking the question, but to answer it as best we can with the best data we can in the most convincing way we can without prejudging the answer. And so Bobby and I get along just. I mean, he is actually a very bright man. He reads scientific papers. We argue about them sometimes. He likes those kind of conversations. He's not dogmatic. I think the picture that's painted of him in, in the press is just, is like deeply unfair. He hired me because he wants my take on it. I don't, I'm. No, I don't come in saying I know all the answers just because I was a Stanford professor. I just, I don't want to recapitulate the sort of structures that I've been trying to, like, reform.
- [32:48]
John Cochrane
But I want to bring this back to your, your main quest, as I understand it, which I, I heartily applaud. You said it briefly. People who ask those questions know their careers are over. There are so many questions in science that Don ask because people know their careers are over. I know. I'll put in my plug. My wife has been bugging you to get people to ask the question of whether putting babies on their backs is a good idea or not. That's classic. And there's retrospective research to be done, there's meta analysis to be done. None of which gets done. It comes to the basic thing, which I think you highlighted, but I want to emphasize we never know for sure. And there's this image that a study is done, it is published. That's the answer, once and for all. The FDA falls prey to this. We're going to do a study, this drug is safe and effective once and for all. And then you never look again. Where science is all about looking again, over and over and over, plumbing into the details, finding all sorts of things slowly but surely are not right. That's not really rewarded in science. So plus the politics, plus the young people aren't doing it anymore. So as we're sort of closing your plan for how to fix this big bureaucratized monolith of politicized science funding and the culture that expects one study answers it forever. I mean, I think your answer to jfk, which rfk, sorry, was not. There's no evidence. There's no evidence. Now let's go look and find out. Which will take decades. We'll never have an absolute answer on a lot of these questions.
- [34:27]
J. Bhattacharya
Well, we may have an answer. It's just, you know, sometimes we should reach a conclusion. But I think.
- [34:31]
Neil Ferguson
I think the key.
- [34:32]
J. Bhattacharya
You picked exactly the key thing, John. The key thing right now. The problem right now in the sociology of the science of sciences is the unit of productivity is a published paper. The unit. But really the unit or citation. Well, but that. And then all that flows from that. Right. So once you have the public paper, then you can get the citations, then you get the promotions, you get the authority, then you have the. You get to be editors and you get to decide truth in your field. The unit of productivity and science ought to be a important replicated idea and
- [35:03]
John Cochrane
people that or the replication of the idea.
- [35:06]
J. Bhattacharya
Yes, but.
- [35:07]
H.R. McMaster
Right, right.
- [35:08]
J. Bhattacharya
Well, I mean, that important replicated idea will have many, many, many people to credit for the person who had the idea, the person who tested the idea, the people who replicated the tests, the people who developed the discussion, the structure to discuss it, all of that is like part of a unit of productivity that matters. So we have the wrong unit of productivity in science. And as a result, you have essentially a choke point where you can stop scientific questions from being answered. They're inconvenient. Right. I think it was like the Lancet or something for the first time in its history or something, they tapped somebody to be. They endorsed. Endorsed is the right word. Joe Biden to be president. You know, you have essentially this. This merging of this, like raw politics with science. And then you have a structure that allows people at the very top of that hierarchy to set standards that determine who advances and feels what questions can be asked. We just need a democratization of that power. And a lot of my thinking around how I led the NIH is around that. Like, how can we reform the scientific structures to make the asking of questions, to reduce the policing of asking of questions, to allow scientists to advance when they have important ideas that are replicated, that make a difference both in their fields and more broadly. It's frustrating, John, because I know you and I have lived this in economics forever, to see these structures play out in other fields as well in science, although science is an incredibly powerful tool, unless we are able to do that, we won't really unleash it for the good of all.
- [36:59]
Neil Ferguson
Well, Jay, we need to let you get back to your two jobs. I think you've illustrated in this conversation why our old friend Scott Atlas is probably wrong to argue that the NIH should be abolished. So long as you're in charge of it. I think it must be a force for good. So thanks so much for joining us. Keep up the amazing work and, and come back when you've achieved all you can achieve to, to join us at Hoover.
- [37:32]
J. Bhattacharya
Neil thank you so much. HR John, it's so good to see all three of you and grateful for your questions, grateful your thoughtfulness.
- [37:40]
Neil Ferguson
Thanks, Jay.
- [37:41]
J. Bhattacharya
Crazy with you, Jay.
- [37:44]
Neil Ferguson
Well, last week President Trump announced that the US Would attack Iran's bridges and power plant every time Iran targeted a ship in the Strait of Hormuz. And it was going to be something on a scale of World War II. But then, of course, just before the markets opened on Sunday, he called the whole thing off and went back to diplomacy. And on Monday, it was Iran's leaders being unbelievably duplicitous. I mean, I took a break last week, week went sailing off the south coast of Ireland, came back, and I had a strong Groundhog Day vibe when I was catching up with the news on U. S. Iran. HR what's going on here? It feels as if some kind of strange loop has been established in US Policy. It's war at the weekend and then. And then diplomacy during the week when the markets are open. Yeah, yeah.
- [38:39]
H.R. McMaster
Hey, Neil, I think really what's happening is, you know, the president has this dissonance about him, you know, about, you know, peace through strength. Trump or retrenchment, disengagement. Trump. He always prefers a big deal rather than military action. And so people are in his ear telling him he's going to get the deal. So he listens to them and says, okay, well, you know, maybe I'll wait. Maybe I'll extend the cease fire. Maybe I'll, you know, we won't engage in a sustained air campaign again or try to force the strait open. And, you know, of course, he's hearing this from certain people in his circle. I think Mr. Wyckoff, for example, or Jared Kushner, who are being told by these dubious interlocutors of Pakistan and Gutter that we're on the verge of the Iranians agreeing to some sort of arrangement that can be acceptable to President Trump and also the other people in his ear about really not taking more resolute military action. Are some of the Gulf states, not all of them, but some of the Gulf states who fear the destruction of large portions of their energy infrastructure. And so the President's being tugged in each direction. But I think what's going to happen, Neil, is that he will not sign up for a bad deal. And one of the reasons is, you know, first of all, the Iranians will try to rub his face in it if he does. And so I think what you're likely to see is this continuous, you know, one step forward, two steps back, one step forward, two steps back, and then the unavoidable conclusion that we cannot in any way accommodate the Islamic Republic of Iran. We can't give them the infusion of cash they so desperately want. We can't give them control over the Strait of Hormuz, and we can't give them really continue to access this ability to project power outside of their borders such that they hold a portion of the global economy at risk and the Gulf state economic model at risk. So that's where I think we're headed.
- [40:32]
John Cochrane
But HR they have that power. It's not given by us. I'm struck by two things. One, these are questions the Iranians refusal to take the deal. It seems like the right strategy from Iran is say sure, fine, take the money, lay low for a little while, but as long as they have the missiles, they're, you know, they're ready to blow up a couple tankers anytime they feel like it and threaten the, threaten the straits. They just needed to let Trump have a face saving way out for a while and they get everything they want, but they're not willing to do it. They want to rub his face in it, the sand or something or other. So why don't they take his, his appeasement deal, which is the other one
- [41:14]
H.R. McMaster
is they can't help themselves, John, they can help themselves.
- [41:16]
John Cochrane
Well, that may be it. You know, if what you want is a deal, you don't start by blowing up the leadership. Clearly this war started as regime change that didn't happen. And now you want a deal with what's left over of something you've blown up, which is much harder to do. On Trump, there's also the board of Peace thing today, this week where he announced that, you know, Hamas had agreed to something at absolute, absolutely hadn't agreed to. It seems to be part of his negotiating strategy is to announce deals that don't exist and sort of hope you've shamed the other side into taking it. Unfortunately, there's no shame among the Iranians but that does seem to be a, a way he goes on. You just say something that absolutely isn't true over and over again and maybe it'll happen.
- [41:58]
H.R. McMaster
No, I think that you're on both counts. First of all, on the Iranian regime, I don't think that that killing the leadership resulted in a more hostile regime. They were hostile enough before, but there are severe, I mean, some significant divisions within the Iranian regime. So we're talking as we always have since 1979 to the shop window of the Islamic Republic. This is Golubov, this is possession, this is Orachi. Right? You know, it was Hatami, it was Rouhani, it was like, you know, but now Zarif. Right. But behind that is the Islam is the Islamic Republic. And you know, and so Vahidi, the head of the irgc, he's not going to compromise because he is constrained and driven by an ideology that includes permanent hostility to the Great Satan, the little Satan, their Arab neighbors. Even so.
- [42:56]
John Cochrane
So the irbc, they can't take the deal because the IRGC will keep sending missiles here and there no matter what gets agreed to because of its internal struggle. Okay, that makes a lot of sense.
- [43:08]
H.R. McMaster
And they also know, hey, after they murdered now with estimates are 52,000 people in a 72 hour period, the Iranians will not be kind to them if they lose power. Right? So they're desperate to hold on to power. And with Trump, I think you're just dead on on this. I mean, he does, he does sort of announce his idealized view of the future and hopes to bend reality toward his vision now. Hey, it worked in getting the Israeli hostages out of Gaza, right? I mean, so it works sometimes. Okay, but it's not going to work with Vahedi and his crew. I don't believe. Neil, what do you think?
- [43:45]
Neil Ferguson
But it sounds to me, HR that like you expect us to end up back at war with Iran. And the only question really is timing. Is this something that doesn't happen until later in the year, perhaps after the midterms? What's the timeline in your view? I mean, I agree with your analysis. It looks unlikely that any kind of meaningful diplomatic compromise is going to be arrived at. But I don't see quite when this war resumes and how far the president really has the stomach for the kind of campaign he does have to wage to regain control of the Strait of.
- [44:20]
John Cochrane
Let me just refine that question. Our choice is resume the war, really. And that has to be regime change or accept defeat. Iran has the missiles that controls the Strait of Hormuz, threatens its neighbors and goes back to building nuclear weapons. Those are the choices, right?
- [44:38]
H.R. McMaster
Well, I think the choice really actually is, is, you know, resume this phase of the 47 year long war, you know, on our terms, or go back to what has failed in the past, which was escalation management trying to de escalate, which across those 47 years has essentially been licensed for the Iranian regime to escalate on their own terms with impunity. I think they are in a position of profound weakness. Now you might say, well, look at what they did with the Houthis, look how strong they are. Well, why are they desperate to get the Houthis involved and to expand the war horizontally to the Bob El Mandev in the Red Sea? Because they want to impose even higher costs on the global economy because they think that's what going to get President Trump to call uncle. Right. Why did they mobilize the Hostashabi militias in Iran? Is it because they're strong? I don't think so. I think it's because they're actually pretty weak at this moment. And so what is helping them, what is giving them hope, is our international reporting, the President's poll numbers, the poll numbers on the war, the effect they think they're having on inflation and the global economy. And so they're reading the Western press, they're reading our polls, and they're thinking, oh yeah, maybe we are pretty strong. But actually, I think they're in a position of profound weakness militarily, economically and across the region. What people are talking about is at least a path toward progress and disarming Hezbollah and the direct talks between Ayoun, you know, and the Israelis, that's kind of, that's a big blow to them. Right. What is the first point on the mou, this terrible MOU that we signed? You know, it was, hey, acknowledging that Iran has a say in the future of Lebanon. Are you kidding me? So I just think we just can't be weak at this moment. I think they're in a position of weakness. I'm reminded of, you know, of Ulysses Grant when he arrives up to the front at Fort Donaldson, you know, and he thinks that the, the war's going terribly because he's seeing wounded coming back and he's coming from the rear and he gets to the front and General Sherman's there saying, oh no, I think we're about to win here, you know, and, and he says the distant rear of an army is not the best place from which to judge what is going on in front. And so I think if you really look at the situation Iran is in, I believe they're in a position of weakness. The worst thing we can do is, I don't know what the word cave would be the worst thing to do because It'd be like 2015. In 2015, the Iranian regime was in a position of profound weakness economically. I'd love to hear what you think about this, Neil. And I think it was the Iran nuclear deal that pulled them up off the mat, gave them the infusion of cash they so desperately needed through the big payoffs, directly unfrozen assets, but then also sanctions relief. So I think it would be a disaster to do the same thing began.
- [47:33]
John Cochrane
Do you think they'll collapse just by leaving it? Leaving it, you know, keeping sanctions in place, not a military invasion. They're, they're weak enough to collapse on their own if we don't help them.
- [47:44]
H.R. McMaster
Well, you're going to constrain the resources available to them, you know, their ability to project power outside their borders. And, and you know, I don't know what you're hearing about like their, you know, missile capacity, drone capacity, I think it's severely diminished. But the problem is every time you back off, they can dig out, you know, a few more drones and they can repair some, some missile launchers, which is really the key thing to launching a missile, is the launcher. So I think we're had, I think we had a big effect on the Strait of Hormuz recently as well and their ability to project power into the Strait. But what's your read on this, Neil?
- [48:14]
Neil Ferguson
Well, I think part of the problem is that we somewhat overstated the achievements of the first phase of the war, particularly with respect to, to missile and drone capabilities. And it then made it seem as if Iran had bounced back. I tell you one thing I've learned from the last few months, AI may be very powerful, but it certainly wasn't powerful enough to defeat the Islamic Republic. It was supposed to be the first AI enabled war. Remember that, chaps? Well, AI doesn't seem to be good enough to reopen the Strait of Hormuz or get President Trump out of the slightly Lyndon Johnson situation he finds himself in. And that brings me to the next topic for discussion, namely AI because, and this is when Professor Cochrane goes head to head with me. I signed an open letter. I don't usually sign open letters, but I couldn't find nothing to disagree with in this one on the subject of AI and the economy. And I'm just going to Quote, it originated with our Stanford colleague Eric Brynjolfsson and it's a three part statement that John Cochran disagrees with. Listen carefully viewers and see which part you think he disagreed with. One, AI may become radically more powerful over the next 10 years. Hard to disagree with that I think. Two this could drive an unprecedented transformation of our economy larger than the Industrial Revolution, but unfolding over a vastly shorter time frame. It could bring risks including large scale job displacement, as well as opportunities such as major gains in living standards. But here's the kicker. Number three. Economists, policymakers and technology leaders must act now to understand the economics of transformative AI and to build the incentives, guardrails and institutions needed to steer AI in a direction that complements humans and benefits society. Professor Cochran, what's to disagree with there
- [50:15]
John Cochrane
all three? Well, may and could. Sure the Easter bunny may come back and could wreak unknown havoc on the on the carrot fields of California. Oh no, that letter. There's lots to think about with AI and there's dangers, including cyber, which I'm sure we'll get to. The letter only said jobs. So the risk of widespread job displacement is this, this bogeyman. As you know as a historian, we've had hundreds of years of technical innovations, none of which have led to widespread job displacement. We must work now to understand sure, give money to our research, but I don't notice any lack of attention. Economists are doing basically nothing but speculations on what AI will do in the future. All to the exact same benefit as their speculations of what climate change will do in the future and their speculations on other such things. We already have an excellent set of review articles in the Journal of Economic Perspectives on it. If you paint so it's not like there's any and even cybersecurity. It's not like we need open letters that everybody I presume in the cybersecurity world is like doing nothing. But how is it? Is AI going to affect us and then we must act now but before we under understand anything really that that seems like a trouble and I'm also allergic to passive voice. Who's this we anyway? We policymakers. I went and read Gavin Newsom's AI executive order which also worries about job losses and guess what the answers are subsidized employment worker owned collectives in place of capitalism. I mean come on, you got to be kidding. This is what happens when you act now last I'm also allergic to I don't usually sign public letters and the history of Nobel Prize winner public letters Pretty much guarantees that the contents will be wrong. Remember population growth? Remember the resource curse, Remember nuclear power? Only a couple of years ago, the Nobel Prize winners, 100 of them, signed on. We have to act now to radically reduce carbon emissions and bring us back to the medieval economy. There was two Nobel open letters. One saying, Trump will be a disaster, elect Kamala Harris. The other that Javier Malay will be a disaster in Argentina. So it's usually the sort of force for open letters.
- [52:48]
Neil Ferguson
But I inferred from your comment, John, I inferred from your comment you want
- [52:52]
John Cochrane
to go to cybersecurity, which I can't stop him. No, you can't stop me right now. There are many other issues with AI other than jobs, and had they brought them forward with some reasonable analysis, I might have signed on to that one, too. The cyber security threat is the obvious one, but people are working on like crazy. And remember, what was it? Huggy Face, the latest big attack. I was very interested that in order to defend against the attack, they had to use Chinese models because the US Regulations made the US AI models unusable against the cyber attack. And there's also. We always are paranoid about. I would hope that when Mythos came out, the first thing the NSA did is to hack into every single computer in China and Iran. And if they didn't, I want my tax money back. Okay, I will now shut up, Neil, and give you a chance.
- [53:42]
Neil Ferguson
Well, you've mentioned the case of hugging face, and before viewers conclude that it's your new affectionate appellation for me, let me just give a quick bit of background. What happened was that some OpenAI models that were being tested broke out of the sandbox, the enclosed space they were supposed to be confined to, got onto the Internet entirely under their own steam, then, quote, chained together multiple attack vectors to attack Hugging Face, which is an AI company. They carried out more than 17,000 actions over multiple days. Now, when I read a story like that, John, I must say, the word guardrail seems to me quite an attractive one because this is happening with almost no guardrails and they're being hastily improvised in response to stories just like this. I think my disagreement with you is that you seem to imply in your commentary that we don't need any guardrails, and indeed, guardrails are a bad idea. That can't be your position.
- [54:54]
John Cochrane
Well, first, the letter was about jobs. The letter said nothing about cyber security.
- [54:59]
Neil Ferguson
So just to be clear, it said it could bring risks, including large scale job displacement placement. So that was just the one. It mentioned. I wouldn't have signed the letter if it had only had that risk in mind. Let's not get hung up on semantics here. The issue that the reason I wrote I put my signature on it is that I think that the zero regulation approach, which I think was adopted last year, encouraged by people in Silicon Valley, doesn't look like it defensible. There are too many risks, particularly this is particularly clear since Anthropic's Mythos became known. But I think that's why I, I think one needs to discuss guardrails.
- [55:43]
John Cochrane
No. And I think now we can have a productive, intelligent discussion. I don't advocate zero regulation, but regulate now means adopt Gavin Newsom's letter on AI. That doesn't seem like a good idea either. You know who is going to regulate? You got to look at the competence of the regulator. Let's send the European Union's regulatory body out to writing rules before we understand what it's going to do. Regulating ahead of time. This cyber attack I think was very interesting. I'll bring HR back. People keep saying, oh, drones mean tanks are out of date. And HR says, well, drones lead to counter drones. So certainly this attack leads to defense. And AI is as good at writing defensive software in patching capabilities as it is offensive ones. So I am, I agree that there, you know, this is a dangerous technology. But the way we do safety regulation wisely is not to try to preemptively write guardrails and act. Now that's how Europeans do it and kill entire industries. The way you do it is, is you know exactly what's happened. Oh boy, these things escape. Let's figure out how to put them back in the box. So setting Gavin Newsom Co. To work on writing prescriptive guide Rails is, you know, tell my story again. It's like saying the Wright brothers have to submit the Boeing 737 maintenance manual before they can take off at Kitty Hawk. I think there's intelligent regulation can happen and usually not by acting now before you understand things.
- [57:18]
H.R. McMaster
I think the key is to incentivize the investments necessary to secure your enterprise, like your company, your critical infrastructure. And we're way behind on this already, right? I mean, so the, when you look at the Volt attacks that were conducted against the United States by the Chinese, we still don't really know the full extent of those. And so we have catch up to do. And so you have AI increasing the cyber threat. But also now the big topic. It's been a big topic for a while, but now it's in the open press quite a bit is post quantum encryption and the need to ensure that enterprises are protected against AI plus quantum, which can break any kind of encryption. You know, so we're in a race, John. I mean, as you alluded up front, I mean, it's a race between defensive measures. And you need, you know, kind of a layered defense against this from a national level. You have to have a good offense in cyberspace, but then you've also got to be able to recover your enterprise as well. There are new technologies out now that allow you, if you get. Get hacked into, if they grab, lock up your data, you know, think of, you know, some kind of a ransomware attack. There's now a capability to restore your operation, you know, in 30 minutes. So you've got to be, you know, improve the resilience of your companies. We have to improve the resilience of our infrastructure. And if policy can do anything, I think it can help incentivize maybe the investments in those kind of capabilities.
- [58:45]
Neil Ferguson
Well, we all have to hope that Goodfellows is secure against the quantum supremacy. I'm sure we'll have a quantum episode of Goodfellas before too long so that we can all start worrying about encryption. But that is as much time as we have to discuss AI because it is now time for the lightning round. Well, during his campaign to become mayor of New York City, Zoran Mondani prime promised to have Israeli Prime Minister Benjamin Netanyahu arrested if he visited New York, though he's since admitted he doesn't actually have the jurisdiction or power to do that. Notably, he also recently didn't appoint any Jewish lawyers, who are not exactly a rarity in New York, to a commission that recommends judges. And my question to the panel is, what's this got to do with democratic socialism? Hey, John.
- [59:44]
H.R. McMaster
Hey. I mean, that whole scene there in New York, it's got to run its course. I mean, I think it's just gone to such an extreme in terms of his public statements, the actions he's taking, that I think are to stifle economic growth, lead to erosion of the tax base. So I just think I just get it over with. So every time something extreme happens, I'm like, okay, just keep it going so it can. It can run its course and people can finally come to their senses and return to normalcy.
- [60:15]
John Cochrane
John, I think it's more dangerous than that because it does pull the center of the Democratic Party and with it, inevitably, the country pretty far left and part of the democratic socialism movement right. Now is visceral hatred of Jews. And it's not cloak it and Zionism or whatever. It's Jews. And that is now getting firmly the previously unsayable things in American politics are now sayable out loud among the democratic socialists, and mainstream Democrats are so scared of them that they're not willing to counter it.
- [60:50]
Neil Ferguson
I think the question really is how far the democratic socialists are democratic Islamists. Come back to this topic. Here's another lightning round question. Christopher Nolan's movie the Odyssey has been released to much discussion and considerable box office receipts. But some critics have complained about, oh si, boring. The lack of historical accuracy and perhaps more interestingly, the casting choices. Have to say that my wife opined on this in the August pages of the Daily Mail. But what's your take, John? Are you a Homer reader, homer lover, or just a moviegoer who was attracted to the sight of Matt Damon with a beard and sandals?
- [61:38]
John Cochrane
I have not seen it yet and I need to my son wrote to say, hey look, they remade Brother Wear out though. And the Odyssey. A couple of comments 1 the Odyssey was a verbal thing, so it was meant to be told and retold and adapted. So if it's adapted a little bit, if it's a little bit too much Christian ethics and not enough ancient Greek, I think that's okay. It is. I've read the Odyssey twice, once in 19th century Italian when I was a schoolboy, which I got nothing out of, and more recently in Emily. Oh, I forgot her last name. I'm sorry. The recent translation, which I enjoyed very much. The problem is if you want to be true to the text, the ancient Greeks were weird. They really believed in these gods, atrocious levels of senseless violence and let's not begin on the misogyny. So do you is it necessary to be true to that to understand ancient Greeks? Or do you take a story and retell it? In some ways that is useful to modern sensibilities. I don't mind the fact of retelling. Just I know, you know, classicists would hate it because it's not true. But. But it is a story meant to be told and reinterpreted. It's the original rogue movie. We've done it many thousands of times.
- [62:54]
Neil Ferguson
HR Odysseus is a soldier returning home. This is something that you've experienced, unlike John and me.
- [63:01]
John Cochrane
How are the suitors in your house?
- [63:04]
H.R. McMaster
Well, there's, there's a great book by Jonathan Shea called Odysseus in America, and it's about, it's about soldiers Returning home. He also wrote a great book called Achilles in Vietnam about combat trauma and the undoing of moral character. So I recommend those. But hey, I got. I've not seen it yet.
- [63:20]
Neil Ferguson
I've got a.
- [63:21]
H.R. McMaster
And I defer to Victor. We should figure out. I think Victor just wrote about this on the. The Blades of Perseus, I think is his blog. Anyway, go to Victor to find out. I want, I want to see this. I want to see the Iliad done though, you know, and, and I want to watch this and I hope, I hope that we all get to learn about like the, the, you know, the warrior ideal of, of, uh, of. Of Achilles and, and, and Patroclus. And so I'm hoping that there'll be an Iliad. There was an Iliad, which would be, would be a prequel, right?
- [63:50]
John Cochrane
Wasn't Brad. Brad Pitt was in charge. And actually the Iliad is very different from your concept of war. This is why it's so hard, hard for us. There's a lot of honor and revenge and who's. Who gets to have the women slaves and so forth. And it's just so completely different from the ethic of, of the American army right now.
- [64:10]
H.R. McMaster
No, I would not say. I mean, there are, there are elements to come all the way through. There's a great book by Christopher Coker, Neil, I'm sure, you know, Chris Coker, man, and it's called the Warrior Ethos. And he essentially traces the warrior ethos from, you know, the, the warrior ideal of Achilles to the present in Western military. So, you know, especially the US and the, and the British military. And it's a compelling book. And you know, of course, what the warrior ethos is, it's what binds warriors to one another, right? And it's based on their sense of honor, their willingness to sacrifice for, for one another and, and you know, good, good military units take on those bonds of, of a family almost, and, and those bonds of affection are really what make you courageous in battle because you fear letting your, you know, your, your fellow warrior down more than you fear any enemy bullet or in this case, spear. I guess so. So I think, you know, I think there's a lot, I mean, a lot to be learned still from, you know, from the Iliad in particular.
- [65:11]
Neil Ferguson
Well, this was supposed to be a lightning round before one of Zeus's lightning bolts strikes us all down. I'm going to offer merely the observation that none of us has seen the movie. In my case, it's a deliberate choice. My son Thomas said, let's, let's not go to this film until we've listened to the original Odyssey. And we did a little bit of research because none of us, neither of us speaks or reads ancient Greek. And we were recommended Robert Fagel's translation, which is available on audiobook with the great Ian McKellen reading it now. This is how Homer's really supposed to be consumed. You're supposed to listen to someone recite it. I can't recommend it too highly. I'm deeply, deeply immersed in it. And so, I hope, is Thomas. Once we're done with the original, we'll go and see Nolan's movie. As I said, lightning will strike us if we don't wrap the show punctually. It's appropriate to end with a shout out to another Scotsman rather more rapidly moving than this one. Josh Kerr smashed the 27 you record for the mile. Running a mile in an incredible 3 minutes, 45.69 seconds. The flying Scotsman, indeed the hero of the Commonwealth Games in my native Glasgow. You see, there is life after the World Cup. That is it for this edition of goodfellas. We shall be back in a couple of weeks with Bill Whelan in his usual place and me back in my box as one of the panellists. That's it for now. Thanks very much for watching. Sing to me of the Man, Muse, the man of twists and turns, driven time and again off course once he had plundered the hallowed heights of Troy. Many cities of men he saw and learned their minds. Many pains he suffered heart sick on the open sea, fighting to save his life and bring his comrades home.