GoodFellows: "It’s The Economy, Israel and Tariffs, Stupid"

Podcast: GoodFellows: Conversations from the Hoover Institution
Date: October 18, 2025
Panel: Bill Whalen (Moderator), Sir Niall Ferguson (Historian), John Cochrane (Economist), Russell Berman (Hoover Fellow, Middle East and Islamic World co-chair; guest)
Absent: H.R. McMaster (Typically a panelist; out for this episode)

Episode Overview

This episode of GoodFellows analyzes two major topics:

1. The Trump administration’s latest Middle East peace plan—its prospects, pitfalls, and regional significance.
2. Pressing economic questions for the U.S. and the world, especially around tariffs, global debt, and the durability of current market highs.

The discussion is insightful, lively, and candid—ranging from geopolitical strategy and regional power realignments to the likely (or unlikely) future of the global economy.

I. Middle East Peace Plan: Prospects and Pitfalls

Segment begins [01:21]

The Trump Declaration: Enduring Peace or Headed for Failure?

• Moderator Bill Whalen opens with historical context: October 17 marks the 31st anniversary of Israel-Jordan peace, and nearly 25 years since the failed Clinton/PLO negotiations.
• Plan Under the Microscope: The so-called “Trump Declaration for Enduring Peace and Prosperity,” a 20-point plan, is parsed by the panel.

Russell Berman’s Skeptical Appraisal

• Complexity & Gaps
  • "The plan is complex and a lot of details remain to be worked out...I don't want to throw cold water on it...but Hamas has clearly been dragging its feet." [02:05]
  • On technocratic government and stabilization force ideas: "Nice idea, but I'm looking for the dotted I's and the crossed T's and they're not there." [03:38]
• Core Issue: Hamas already reneging on conditions; prospects for actual disarmament and governance reform are dim.
• International Force: “I don’t think this has been worked through” regarding an international stabilization force. [03:23]

John Cochrane: Realist and Pessimist

• Order Precedes Prosperity
  • “Hamas needs to be defeated...You can’t put in an international force...when there’s no peace. Someone has to defeat them.” [05:08]
  • “It’s in everyone’s interest to just let this place rot." [05:34]
• Cynicism Toward Regional Stakeholders
  • None truly want the responsibility or cost of fixing Gaza.
  • Predicts likely continued decay for the region.

Niall Ferguson: An Optimistic Counterpoint

• Dealmakers, Not Diplomats
  • “You’re both being a bit too negative...These are real estate guys...the deal guys, as Jared Kushner calls himself..." [05:46]
• Behind-the-Scenes Pressure
  • "They were able to get the Qataris in particular to lean on Hamas to sign the agreement. And getting the hostages out is a major breakthrough. It’s not a trivial thing. It’s really the whole point...” [07:16]
  • “Hamas can either cooperate with the terms of this agreement or face destruction...They don’t have any hostages." [07:47]
• Abraham Accords 2.0
  • Ferguson sees the initiative as a revival/expansion of Kushner’s original “economics first” approach—building up Israeli-Gulf alliances and marginalizing the Palestinian issue.
  • “It is a huge success for the real estate guys and I think we should just take our academic hats off to them.” [08:41]

Panel Back-and-Forth: Who Will Face Down Hamas? Can Gaza Ever Be Fixed?

• Cochrane and Berman Push Back: Who will actually defeat Hamas? It's in no one's direct interest to do so.
• **Berman: “For 50 years the Arab states really haven’t wanted a Palestinian state and they continue to not have a Palestinian state...Gaza is going to be a place of rubble.” [10:15]
• Netanyahu’s Political Fate: Is he Churchill-in-1945, about to be tossed out after a strategic victory?
  • Ferguson: “This is nearing the end of Netanyahu’s career...This is a kind of Churchillian tragedy.” [11:38]
  • Berman: “His coalition is actually somewhat up in the polls in Israel. So it’s not absolutely dire for him.” [13:58]
  • Cochrane: “It’s always the economy, stupid...if Israel’s economy is doing great, Netanyahu may be looking better.” [14:37]
• Peace Plan (or Not): Ferguson underscores: “This is a Gaza peace plan, not a Middle East peace plan.” [16:31]
  • Struggle with Iran (and Houthis, Hezbollah, Syria) far from resolved.

What If Hamas Reneges?

• Ferguson:
  • “They’re in a much weaker position...Israel controls half, slightly more than half, of Gaza...” [18:53]
  • “As President Trump said on social media just in the last 24 hours, if Hamas doesn’t stick to the deal, then they can be destroyed.” [19:08]

Gaza’s Bleak Future:

• International Will: Only Israeli Defense Forces are willing and able to attempt disarmament; Arab states will not step in.
• Emigration as Escape: “Maybe Gaza doesn’t have to be solved...Why can’t they leave from Gaza and that’s it?” (Berman) [10:15]
• On Western Misconceptions: “The Israeli left has disappeared. The Israeli public is not in the mood to compromise...No Eugene McCarthy is about to run for PM.” (Berman) [22:34]

II. Abraham Accords and the Future Middle East: Economic and Cultural Realignment

Segment begins [23:40]

Can the Accords Transform the Region?

• Berman: “Integrating Israeli’s technology and innovative capacity with the capital of the Gulf is how to build a prosperous region...the young generation in Saudi that wants prosperity, that wants jobs...Project 2030. There’s a vision of a prosperous region that would stretch from the Gulf up through Israel.” [24:02]
• Regional Irony: “Maybe that region could really flourish in the current decades, while we’re watching the former colonial powers really decline with zombie economies and an incapacity for governance.” [25:15]

Real Estate-ism: Diplomacy by the Private Sector

• Ferguson: “What’s exciting to me about the vision that Jared Kushner had...is that it’s not just something that a bunch of development economists...came up with. It’s an actionable business plan.” [25:42]
• Cochrane’s Caution: “I would have more faith in a plan that was more based on liberal market principles rather than here’s our plan for a billion dollars that we are going to direct to some, you know, solar project in the middle of the desert.” [26:46]
• Ferguson’s Rebuttal: “The idea that you can get Saudis to invest in Israeli companies is really quite profound...” [27:55]
• Historical Perspective:
  • “Israel’s situation is vastly improved compared to 1973. The Arab coalition is now investing...Israel is no longer isolated.” [27:55]
• Innovation Engine: IDF as tech incubator, Israeli innovation as a regional magnet. [31:31]

Is Real Estate-ism Transferable Globally?

Segment begins [34:53]

• Whalen: “Is real estate-ism transferable? Will it work with Putin? With China?” [34:53]
• Berman: “We’re moving...to businessmen as the personalities in diplomacy. That’s why President Trump may not be an outlier, but a harbinger.” [36:35]
• Cochrane: “The danger of it is you need to not just have the ability to make a deal, you need a goal...It’s not a one and done...This is going to go on for long past Trump’s presidency.” [38:30]
• Ferguson:
  • “Thus far, it hasn't worked with Putin...Anchorage summit failed...Until the costs of continuing the war rise significantly for Putin...there is not going to be a success for real estatism with respect to Ukraine.” [38:30]
  • Taiwan is the “big one;” Chinese will play hardball, U.S. leverage is limited.

III. U.S. and Global Economy: Crashes, Tariffs, and Debt

Segment begins [40:43]

Is a Market Crash Coming?

• Cochrane: “The crash is coming when? I don't know...Stocks go up, stocks go down...I don’t think 1929 is coming. I think 2000 might be coming...when the initial froth dies down.” [41:30]
  • Stock downturns not catastrophic unless credit system is involved.
• Ferguson: “I agree with John. The preconditions for something as cataclysmic as 1920, 1932 aren’t there...We won’t make those monetary mistakes again.” [43:15]
  • But—“Shocking fact of the day: The American average tariff rate is estimated to be back today to where it was in 1934.” [44:31]

Tariffs, China, and the Risk of Trade War

Segment begins [48:53]

• Moderator: "The market lost $2 trillion in value after Trump threatened a 100% tariff on China."
• Ferguson: “The real issue...China threatened to create licenses for all rare earth exports...That was a pretty big gauntlet...We’re now into another round of a kind of economic war that dates back to the first Trump term.” [49:12]
  • “I don’t think it’s going to boil over into real war, just to be clear...Right now, I think they’re both content to trade economic blows.” [50:39]
• Cochrane on Tariffs as Geo-Economic Weapon: “They may not hurt the US that much, but they hurt the other countries a lot...Tariffs are a geopolitical weapon.” [51:19]
  • Laments blurry negotiation targets—“What do we want the Chinese to do?” [52:13]
  • Emphasizes need for clear strategy, not just blunt-force tactics.

Global Debt Crisis Looms?

Segment begins [53:49]

• Whalen: "The IMF warns global government debt is on track to hit 100% of GDP by 2029; US likely 140%, China 113%."
• Ferguson: “The Germans...imposed a kind of hair shirt on themselves by having a debt break...Switzerland has a debt break and it’s working very well.” [54:12]
  • “Argentina...President Milei has been in effect bailed out by the US treasury in a way that I think has almost no precedent.” [54:45]
• Cochrane: “Plans are easy. We all know how to solve this debt problem. The only question is when do our governments get around to doing the obvious things, tax reform, social program reform...” [56:13]
  • Dollarization recommended for Argentina: “All of Argentina’s money is $40 billion. You can exchange all of Argentina’s pesos for $40 billion of US dollars...They swung to surplus very quickly.” [57:16]

IV. Brief Lightning Round: What Is the Panel Reading?

Segment begins [58:17]

• Niall Ferguson: “Reading Thomas Sowell’s trilogy...fantastic stuff. Can’t recommend those books too highly.” [58:37]
• John Cochrane: “Knowledge and Decisions [by Sowell], a single book but his economic masterpiece.” [59:14]
• Bill Whalen: “Reading the works of Theodore White and his Making of the President series—just plain old reporting, delightful to read.” [60:20]

Memorable Quotes & Timestamped Highlights

• Russell Berman on the Gaza Plan:
  “Hamas has clearly been dragging its feet. In addition, Hamas has been carrying out summary executions...has said that it won’t disarm and intends to participate in governance.” [02:05]
• John Cochrane’s skepticism on international stabilization:
  “You can’t put in an international force...when there’s no peace. Someone has to defeat them.” [05:08]
• Niall Ferguson on Trump’s dealmaker strength:
  “These are real estate guys...the deal guys, as Jared Kushner calls himself, and Steve Witkoff. And the key here is to look behind the 20-point plan…” [05:46]
• Niall Ferguson on Netanyahu:
  “He has in all kinds of ways improved the strategic situation of Israel...But like Bismarck, he has incurred the opprobrium of bien-pensant liberals…but you don’t do this kind of thing without pretty Machiavellian domestic politics.” [11:38]
• Russell Berman on Palestinian statehood:
  “For 50 years the Arab states really haven’t wanted a Palestinian state and they continue to not have one. Gaza’s going to be a place of rubble.” [10:15]
• Niall Ferguson on Abraham Accords:
  “It’s not just something that a bunch of development economists at the State Department or the World Bank came up with. It’s an actionable business plan.” [25:42]
• Bill Whalen’s key question:
  “Is real estate-ism transferable? Will it work with Putin? With China?” [34:53]
• John Cochrane on tariffs as weapon:
  “Tariffs are a geopolitical weapon...They may not hurt the U.S. that much, but they hurt the other countries a lot.” [51:19]
• Niall Ferguson on debt and the state of the world:
  “The Germans...imposed a kind of hair shirt on themselves by having a debt break...Switzerland has a debt break and it’s working very well.” [54:12]
• John Cochrane on government solutions:
  “Plans are easy. We all know how to solve this debt problem. The only question is when do our governments get around to doing the obvious things, tax reform, social program reform...” [56:13]

Tone and Takeaways

• The panel’s tone is frank, scholarly, and often dryly humorous. There’s persistent skepticism about “big plans” and bureaucratic fixes—balanced by an appreciation for the unusual effectiveness of non-traditional, business-driven diplomacy.
• On Gaza: Deep pessimism about quick fixes; consensus that the region’s economic future may sidestep the Palestinian issue rather than confront it.
• On Economics: Tariffs viewed as worrisome but not an immediate disaster; the global debt spiral is alarming but not (yet) existential. The future may hinge on whether governments are finally “forced by interest rates to wake up.”
• On ‘Real Estate-ism’: The Trump/Kushner approach did deliver breakthroughs, but whether that style translates outside the Middle East remains uncertain.

For further exploration, the panel recommends (with strong endorsement):

• Thomas Sowell’s works: Race and Culture trilogy, Knowledge and Decisions.
• Theodore White’s Making of the President series.
• Dan Senor’s “Startup Nation.”

Note: This summary omits advertisements, intros/outros, and staff announcements, focusing solely on the core discussion and substance of the episode.