The Commentary Magazine Podcast

Episode: State Capitalism and the Tariffs
Date: September 2, 2025
Host: John Podhoretz, with panelists Abe Greenwald, Seth Mandel, Christine Rosen
Topic Overview:
This episode delves deeply into the current state of U.S. economic policy under the Trump administration, focusing on the use and legality of tariffs, the reach of state capitalism, executive branch overreach, and the broader geopolitical and societal ramifications. The second half pivots to the ongoing Israel-Gaza conflict, U.S.-Israel relations, and shifting dynamics in the Middle East.

Main Theme

State capitalism, executive power, and economic uncertainty:
The episode centers on recent judicial developments regarding presidential power to impose tariffs, the risks and consequences of blurred lines between the public and private sectors, and how emergency powers have been leveraged (and abused) in economic and foreign policy realms. The hosts offer a historical and legal perspective, tie in the recent Intel transaction, and explore the repercussions both domestically and internationally.

Key Discussion Points & Insights

1. Judicial Review of Executive Tariff Authority

• [04:21] John sets up the issue: An appeals court has ruled against the executive branch's right to unilaterally impose many tariffs under emergency powers; the Trump administration is likely to appeal to the Supreme Court.
• [05:50] Economic uncertainty: This in-between state leaves businesses unsure about production, supply chains, and sourcing materials.
  • "Economic uncertainty is poison to a well-functioning and calm economic situation." – John
• [06:33] Christine points out upcoming consumer impacts:
  E.g., removal of the $800 de minimis shipping exemption is a direct result of current tariff policy.
  • "There are a few hits that American consumers are going to start feeling."
• [08:31] Abe adds: Trump’s reliance on "shortcuts," using emergency powers and executive orders, is at the heart of the legal challenge.

2. Partisan Lines and the Role of the Court

• [09:34] Seth observes: The current partisan realignments are messy; many conservatives want the courts to strike down tariffs, even if it conflicts with restraining judicial activism.
  • "There's a lot of hoping that the tariffs somehow... are made to disappear... even if the reasoning is inconsistent."
• [10:42][11:38] Christine and John analyze foreign policy implications:
  Tariffs have undermined U.S. relations (e.g., with India, now aligning more publicly with China and Russia), and have not achieved intended policy aims.

3. The Legislative vs. Executive Balance

• [11:38] John:
  • The Supreme Court has historically granted presidents broad national security powers, but tariffs are a Congressional prerogative.
  • If unchecked, presidents would have precedent for significant expansion of executive authority.
    • "We are in a new reality...where presidents will have more latitude to do things that I think make a lot of people uncomfortable." – John [14:13]
• [15:31] Christine warns:
  • Floating emergency declarations for non-traditional areas (e.g., housing crisis) has slippery-slope potential.
    • "What power would that give the president... how might he intervene in the housing market?"

4. State Capitalism & the Intel Buy-In

• [16:41] John details Intel stock acquisition:
  The federal government has taken a nearly 10% stake in Intel, with potential to acquire more, funded entirely by debt.
  • "Nobody believes that it is wise to use debt to buy stock. That is not a sensible move." – John [20:30]
  • Risks: Debt-funded investments could lead to political interference in business decisions.
    • "This is state capitalism. This is very dangerous precedent." – John
• [23:42] Christine introduces "pay-me capitalism":
  • "It's a power mechanism. He does it so he can go to these companies and do exactly what John was theorizing... say we want to make policy decisions that impact your business. That is not free market capitalism."
  • [25:52] Seth: Warns this "subsidy-ownership" model could easily spread across industries (not just national security-sensitive sectors).

5. The Trump Approach to Business and Politics

• [27:14] John: Trump’s history as a real estate developer shaped his comfort with transactional, government-incentivized business (tax deals, subsidies) and he's now extending this logic nationally.
  • "That is how business is often done at the state level. And it is... an atrocity and an injustice because...taxation should be equal...one rule for everybody."
• [32:57][33:25] Panel consensus: While Trump is "honest" about the system, normalizing state ownership of business, especially by Republicans, erodes arguments against future left-wing expansions of such power.

6. Executive Power, Accountability, and Hypocrisy

• [36:32] Christine points out: Neither party is consistent when in power.
• [37:22][39:41] John and Abe:
  • Discuss congressional powerlessness when the president refuses to enforce laws (using TikTok as an example).
  • Highlight "cautionary tales" of Hunter Biden and political families exploiting their access, undermining trust in institutions.

7. Cryptocurrency, Economic Pessimism, and America's Mood

• [42:01][43:09] Christine and John:
  • Skeptical of the Trump administration’s crypto enthusiasm and schemes to give Gazan property owners "crypto" for resettlement.
    • "There's some sort of, like, insane hyper optimism around crypto, particularly among the people who are all in on it, that I've never understood."
  • John likens crypto’s promise to 19th-century "boosterism": value depends on mass buy-in, not inherent substance.

Memorable Quotes & Notable Moments

• On the state of government power:
  • "We're now in a reality... where presidents will have more latitude to do things that make a lot of people uncomfortable on both sides of the aisle, depending on who's the president." – John [14:13]
• On 'pay-me capitalism':
  • "The new phrase that everyone's using for this because it is an order of magnitude larger is 'pay me capitalism.'" – Christine [23:42]
• On transactional politics:
  • "Trump is a real estate developer. Real estate development is a political job." – John [27:14]

Timestamps for Key Segments

• Tariffs and Judicial Review: 04:21–15:31
• State Capitalism and Intel Buy-In: 16:41–23:42
• Crypto and Economic Optimism: 42:01–46:11
• Israel-Gaza Segment Begins: 49:59
• Assassination of Abu Ubaidah, Bibi's Strategy: 51:29–54:58
• U.S.-Israel Relations and Trump's Role: 54:58–66:53

Israel, Gaza, and U.S. Policy

1. Recent Developments in the Conflict

• [51:29] John: Highlights the assassination of Abu Ubaidah, calling it a pivotal blow to Hamas.
  • "This is kind of like the big one. He's the superstar of Hamas. He's the face of Hamas. He is now gone."
• [53:25] Netanyahu’s stance: No deal on hostages unless all are returned; no incremental agreements.

2. Trump's Influence on Israeli Policy

• [54:58] Seth: Protests in Israel now directly appeal to Trump; Bibi’s decisions are increasingly shaped by Trump's expectations.
  • "The war effort really depends on the approval of the American government at this point... There isn't the feeling that this is 'the West'—this is Israel and America, and it's Trump."
• [59:41] John: The radicalization of anti-Israel activism in the U.S. paradoxically frees up Trump and Bibi to act, as their opponents overreach.
  • "These people are having a huge impact on the Democratic Party... they are providing both Trump and Bibi with a freer hand."

3. American Jewish and Democratic Politics

• [62:58][64:12] John: Attacks "quisling" Democrats (e.g., Jake Sullivan, Jerry Nadler) for abandoning Israel—argues shifting D-Party politics leaves Israel dependent on Trump's support.

4. Unprecedented U.S. Diplomatic Solidarity

• [66:40][66:53] Panel: Trump administration taking the unusual step of denying Palestinian delegation visas to attend the UNGA, and considering reprisals against states backing Palestinian recognition.

Podcast Language and Tone

The panel's style is frank, informed, sometimes wry, and deeply opinionated. They often reference personal experience and historical precedent, openly debate policy principles, and call out perceived hypocrisy on all sides.

Conclusion

• [70:02] John closes: With the U.S. and Israel locked in an increasingly transactional, precarious alliance, and domestic economic and political norms eroding, the future hinges on decisions made in these legal, legislative, and global arenas. The panel frames this as a pivotal moment—both for the balance of U.S. government power and for America's role in the world.

For listeners who missed the episode, this summary details the main currents, critical perspectives offered by each panelist, and the real-world consequences of evolving U.S. economic and foreign policy.