Trump’s Trade War w/ Canada Is Just Getting Started!" | Edward Fishman PT 2

Summary

Impact Theory Podcast: “Trump’s Trade War w/ Canada Is Just Getting Started!" | Edward Fishman PT 2

Host: Tom Bilyeu
Guest: Edward Fishman (Foreign policy expert and author of Choke Points)
Date: March 13, 2025

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Episode Overview

This episode is Part 2 of Tom Bilyeu’s deep-dive conversation with Edward Fishman about the new frontiers of economic conflict, focusing on the shifting global power dynamics, the rise of economic warfare through sanctions and tariffs, and the implications of U.S. foreign policy under recent and prospective administrations. They transition from discussing Russia and Ukraine to dissecting Trump’s trade strategy, the future of digital currencies, inflation, and the limitations and risks of economic leverage. The episode offers unfiltered insight and debate, blending policy detail with practical takes for listeners wanting to understand world affairs beyond the headlines.

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Key Discussion Points and Insights

1. The Shift in Geopolitical Conversations—Putin's Narrative Wins ([01:29 - 05:23])

• Putin’s Tactics: Fishman explains Putin’s success at reframing the Western policy conversation, moving the focus away from Ukraine to direct U.S.-Russia dealings.
  • Quote: “Putin has kind of reframed the conversation where the US and Russia are just talking bilaterally without really even considering the Ukraine situation.” (Edward Fishman, 01:41)
• Historical Attempts at Alliance: Every U.S. president since the Cold War has tried to "reset" relations with Russia, often overlooking Russian aggression—a pattern Fishman criticizes as naïve and dangerous.
• Norm of Post-War Territorial Integrity: Fishman underscores the importance of defending the post–World War II norm against territorial conquest and how accommodating an expansionist Russia could invite similar behavior from China or others.

2. Funding Ukraine—Frozen Russian Assets and U.S./EU Roles ([05:28 - 09:33])

• The $250 Billion Question: Huge sums of Russian sovereign assets are sitting frozen in EU accounts; Fishman proposes seizing these to fund Ukraine directly, thereby easing burdens on U.S. taxpayers and revitalizing Western defense industries.
  • Quote: “The obvious solution here, Tom, is for the EU to seize those Russian assets, use them to buy weapons from U.S. companies...” (Edward Fishman, 06:46)
• Partisan Appeal: Fishman argues the solution should appeal across the U.S. political spectrum: Democrats get robust Ukrainian support, Republicans and MAGA sympathizers see Europe funding the fight.
• Why Isn’t This Happening? Fishman cannot explain why Trump (or even Biden) hasn't pushed harder for the EU to take this route but speculates Trump could sway Europeans more effectively due to his unpredictable, hardline positions.

3. Trump’s Mindset and Strategy on Ukraine and Europe ([09:33 - 12:35], [13:10 - 15:18])

• Trump’s Motivations: Bilyeu and Fishman speculate Trump’s reluctance to push the EU on asset seizures is tied to wanting to broker a peace personally (“the dealmaker” persona) or maintain U.S. control over negotiations rather than let Europe take the lead.
  • Quote: “He wants to control the negotiations, and that means promising Zelensky in his own unique way that, no, trust me, ... I'm going to do some unsaid thing.” (Tom Bilyeu, 11:09)
• Nobel Peace Prize Ambitions: Both suggest Trump’s passion for the Nobel Prize motivates his maneuvering—he wants credit for peace.
• European Reluctance: Fishman cites German fears about the financial stability of the eurozone as holding back action on Russian assets; this may change with tougher German leadership.

4. Economic Warfare Tools: Sanctions, Trade, and U.S. Leverage ([15:21 - 21:30])

• Weaponizing the Dollar and Sanctions: Fishman details how sanctions enforcement hinges on the dominance of the dollar and dollar-denominated reserves, but Russia and others have begun shifting reserves to euros as a hedge.
• Secondary Sanctions: The power of U.S. sanctions derives not only from direct actions but from threatening to cut off third parties (e.g., Swiss traders) that violate embargoes.
• Patchwork Sanctions on Russia vs. Total Embargoes on Iran: Iran survives via barter and cash—a preview of how global trade rewires under extreme economic isolation.
• Biden’s Cautious Energy Policy: Fishman criticizes the Biden administration for avoiding hard-hitting oil and gas sanctions on Russia due to U.S. inflation fears, which he claims gave Putin more room to maneuver.

5. Energy Independence and Economic Power ([21:30 - 23:45])

• Shale Oil’s Historical Impact: U.S. “energy dominance,” if aggressively pursued (as under Trump’s "drill baby, drill" rhetoric), can give the U.S. more flexibility to tighten sanctions with less risk to global supply.
• Investment and Market Signals: For sanctions-led strategies to work, U.S. investors need assurance of stable oil prices to justify drilling; policy clarity is key.

6. Trump, Putin, and the Psychology of Power ([23:16 - 29:46])

• Trump’s Treatment of Leaders: Bilyeu posits Trump is tougher on weaker states (Canada, Ukraine, Mexico) and more deferential to strongmen like Putin and Xi Jinping—a dynamic Fishman affirms, linking it to perceived legitimacy concerns from 2016 Russian interference.
• Domestic Political Optics: Trump could silence critics by adopting a tougher stance on Russia, as even a recent hardline Truth Social post was an outlier with little follow-up.
• Personal Grudges: Trump’s dislike of Zelensky—rooted in his first impeachment and perceived 2024 intervention—shapes his approach to Ukraine.

7. The Future of Economic Warfare: Crypto, Digital Currencies, and Financial Systems ([29:46 - 44:53])

• Choke Points and Innovation: Discussing Fishman’s concept of "choke points" in the financial system (dollar dominance), the pair explore how digital currencies (CBDCs, stablecoins, crypto) could either disrupt or reinforce U.S. leverage.
  • Quote: “[Dollar-based] process was built in the 70s and it still takes days to clear international bank transfers ... using stablecoins or central bank digital currencies, this process could take seconds.” (Edward Fishman, 30:35)
• The Crypto Arms Race: China’s digital RMB (central bank digital currency) is leading; the U.S. risks losing control if it doesn’t innovate or set global standards.
• Privacy and Control: Bilyeu expresses deep skepticism about U.S. government–issued digital currencies (CBDCs), fearing surveillance and censorship risks reminiscent of Orwell’s 1984.
  • Quote: “That feels like some real 1984 shit.” (Tom Bilyeu, 35:40)
• Stablecoins vs. CBDCs: Fishman suggests either can underpin U.S. power if robustly backed and regulated, but worries about poorly supervised private projects fueling illicit finance.

8. Inflation, Fiscal Discipline, and the Real Limits of U.S. Power ([44:53 - 48:40])

• Inflation as a Universal Threat: Both agree that inflation is not a victimless tax, hurting everyone, with Fishman emphasizing the impossibility of growing or taxing the way out of the current fiscal hole without fundamental reforms.
• Taxation and Spending: Fishman advocates not just for increasing taxes but for simplifying the tax code, with Bilyeu emphasizing that even 100% taxation of the rich isn’t a practical fix to U.S. deficits: “You have a problem that needs a solution other than more tax.”
• Runaway Debt Service: The cost of servicing U.S. debt, now larger than military spending, is described as a looming crisis that cannot be solved by taxation alone.

9. Government Reform, Transparency, and the Doge Administration ([50:17 - 58:16])

• Civil Service Shake-Up: Fishman raises concerns about indiscriminate firings in the U.S. civil service, arguing that letting go of young, high-potential recent hires is counterproductive. He highlights the need for smart government reforms, not just axing staff for appearances.
• Transparency and Audits: Bilyeu calls for radical transparency in government spending and bureaucracy, referencing Elon Musk’s views on compensating talent to reduce corruption.
• Structuring Government for Economic Warfare: Fishman urges the U.S. to create the equivalent of a “Pentagon for economic warfare”—a cohesive, strategic approach to economic statecraft.

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Notable Quotes & Memorable Moments

• On Losing the Norm Against Aggression:
  “You undo the biggest accomplishment of the 20th century after the, you know, the catastrophe of World War II, which is to create a norm against a territorial conquest by force.”
  (Edward Fishman, 04:36)

• On Using Russian Assets to Fund Ukraine:
  “The EU should seize those Russian assets, use them to buy weapons from U.S. companies … revitalize the defense industrial base … and give Ukraine stable economic and military support without burdening the US taxpayer at all.”
  (Edward Fishman, 06:46)

• On Trump’s Motivation:
  “He wants to control the negotiations … He wants to be remembered as a deal maker, as a peacemaker, as somebody who really like, regalvanized America ...”
  (Tom Bilyeu, 10:56 & 25:39)

• On Economic Warfare’s Future:
  “Digital currencies, whether or not they're cryptocurrencies or state backed digital currencies, will disrupt international payments in the next five to 10 years … but that doesn’t necessarily mean the U.S. will have less power.”
  (Edward Fishman, 31:00)

• On CBDCs vs. Stablecoins:
  “You could build safeguards into our cbdc ... The US government shouldn't just be able to cut off American citizens from bank accounts. That's crazy.”
  (Edward Fishman, 37:39)

• On Debt and Budgets:
  “If you tax the wealthy at 100%, you still don't solve your spending problem.”
  (Tom Bilyeu, 47:51)

• On Public Sector Talent:
  “You're firing all of the highest potential, hardest working people and the cheapest employees ... and sparing the actual fat cats ... the indiscriminate aspect of it is problematic.”
  (Edward Fishman, 51:32)

• On Economic Statecraft:
  “There's not a Pentagon for economic warfare ... If we really want to fight and win the economic wars of tomorrow ... how do we need to structure our government so we're not playing games at telephone ...”
  (Edward Fishman, 56:21)

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Timestamps for Important Segments

| Timestamp | Topic | |-----------|-------------------------------| | 01:29 | Putin’s information warfare and U.S./Russia relations | | 05:28 | Proposal to seize Russian sovereign assets for Ukraine | | 08:23 | Why Trump hasn't pushed EU to seize assets; European response | | 13:10 | Trump’s Nobel Prize ambitions and European reluctance | | 15:21 | U.S. leverage, sanctions history, and Russia’s dollar hedge | | 18:13 | How heavily sanctioned countries survive | | 20:13 | Biden’s restrained oil sanctions and political trade-offs | | 21:30 | Energy independence’s role in sanction effectiveness | | 23:16 | Trump, Putin, and bullying/appeasement psychology | | 29:46 | The coming disruption: crypto, CBDCs, and sanction-proof finance | | 35:40 | Privacy, censorship, and fears of a “1984” financial system | | 44:53 | Inflation, fiscal discipline, and spending limits | | 50:17 | Bureaucracy, firings, and government talent retention | | 56:21 | Building a Pentagon for economic warfare | | 58:20 | Where to follow Edward Fishman & book endorsement |

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Tone & Style

The conversation is candid, unscripted, and occasionally charged—a blend of policy wonk detail, personal anecdote, and practical realpolitik. Bilyeu often adopts a skeptical everyman lens, pressing for clarity and outcome-driven reform, while Fishman combines policy expertise with frank, even critical, personal insight.

For listeners seeking a nuanced, critical look at global economic strategy—without the fluff of headlines—this episode delivers a comprehensive, memorable discussion on how money, power, and ambition shape our disrupted world.

Transcript

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[Tom Bilyeu]

I'm Tom Bilyeu, and this is Impact Theory. Welcome back to part two of my conversation with Edward Fishman. If you're just tuning in, go back

and start with part one.

We've already laid the groundwork on how global power is shifting, why economic sanctions are the new battlefield, and what most people don't understand about trade wars. Now we're diving into the ripple effects of tariffs, how nations are preparing for the next economic standoff, and, and what all of this means for your financial future.

Let's get right back into it.

[Edward Fishman]

But here's, here's, here's the thing that worries me, Tom, is what you're saying is a sign of Putin's efforts working, right? Where it's like he's changed the conversation. Like, you gotta wonder, like, who's driving the conversation.

[Tom Bilyeu]

Like.

[Edward Fishman]

Cause the conversation was all about, like, you wouldn't even be thinking about business deals with Russia as a conversation that was separate and apart from an end game to the war in Ukraine. Right? The sanctions, the idea was you lift them if there's a peace that is tolerable, that, you know, it's part of it, that's the, that's your carrot. You know, that's what you get to play. The card you play at the negotiating table. You say, okay, Putin, you know, if you pull back from this part of Ukraine and there's peace for this number of days, and we start lifting sanctions, right? Putin has kind of reframed the conversation where the US And Russia are just talking bilaterally without really even considering the Ukraine situation. And your point about, you know, Russia as an adversary and like, this is like, why, why are we not negotiating oil deals with Iran? I think is really well said, and I think Like I'll even say it, just my own personal experience. You know, I came at this from as being a Russophile. You know, I studied Russian history, Russian literature. I loved Russian culture. I lived in Russia for a summer when I was a student. You know, it's hard not to, you know, if you, you work on Russia issues, not to see the allure of a U. S. Russia alliance, right? And in fact, the US and the Soviet Union were wartime allies during the Second World War. The problem, though, is every single post Cold War president has tried this. You know, Bill Clinton and Boris Yeltsin were best friends. You know, George W. Bush said that he looked in Putin's eyes and saw his soul. You know, Obama, I think one of the most catastrophic decisions he made was he became president six months after Putin had invaded Georgia in the summer of 2008. And then he said he was going to reset U.S. russian relations. So he basically gave Putin basically just forgave the fact that he had just invaded his neighbor and effectively peeled off part of its territory in South Ossetia and Abkhazia, which are these two breakaway regions in Georgia. And. And then Trump again, when he came in in 2017, basically tried to excuse a bunch of the things that Russia had done. Biden, you know, I think was probably the most hawkish post Cold War American president on Russia. But when he came in, what, what did he want? He wanted a stable and predictable relationship with Putin. The reason he wanted that was because he said he saw the world the way you and I do, which is we need to focus on China. Right? The problem is, you know, presidents don't get to just dictate the way other people. People act, right? And he might want a stable and predictable relationship, but what Putin wants is to rebuild the Russian empire. And so within, you know, a few months of Biden coming into the White house, you have 100,000 troops on the Ukrainian border. And so, you know, at some point you gotta ask yourself, like, are you willing to live with an imperialist Russia, right? With a Russia that's on the march, that's conquering neighboring territories, not just Ukraine, but then also NATO members like Estonia, Latvia, Lithuania, Poland. Is that something we're okay with? Is that something that is, you know, something we can live with in the United States and would be. Be comfortable in that world? My own view is no, that we can't be comfortable in that world. And in fact, it's would be opening Pandora's box, because as soon as you allow that to happen, what's stopping China from Taking Taiwan or going even further. Right. And taking other territories in its neighborhood. Right. You basically get, You. You undo the biggest accomplishment of the 20th century after the, you know, the catastrophe of World War II, which is to create a norm against a territorial conquest by force. Right? We. That's how most of history was. Right? Most of history was you're a strong country. You just took your neighbor's territory with your, with your army. Right. It's pretty big accomplishment in human history that we don't really do that anymore. Right.

[Tom Bilyeu]

Or didn't.

[Edward Fishman]

And so I, I do think that it's, it's pretty important to push back against Russian aggression.

[Tom Bilyeu]

Okay. Push back against Russian aggression by re teaming up with EU and funding the life out of the Ukraine.

[Edward Fishman]

So the short answer is yes, but I think there's something that we should talk about because it's, it's not getting enough play right now, but it's really important. Right? So over the last three years, the US has given somewhere between 100 and 150 billion dollars worth of support to Ukraine. The EU has given a similar amount, right around 150 billion dollars to Ukraine. Currently, as we speak, there are 250 billion dollars roughly, of Russian sovereign assets sitting frozen in European bank accounts that are just sitting there accumulating interest. They're never going back to Russia. Why the hell has the European Union not seized these assets and given them to Ukraine? The US Congress last year, an overwhelming bipartisan majority passed a law authorizing President Biden to seize the Russian assets in the United States and give them to Ukraine. In the US there's only like 5 to 10 billion, so it's not that much. Right. But in Europe, there's somewhere between 2 and 300 billion. So more than the total amount of US support to Ukraine over the last three years is just sitting there in European bank accounts. So I think the, the obvious solution here, Tom, is for the EU to seize those Russian assets, use them to buy weapons from U.S. companies. So it's good for the U.S. it re. Revitalizes the defense industrial base in the U.S. which, you know, has gone into disrepair in recent decades. And you give Ukraine stable economic and military support without burdening the US Taxpayer at all. The reason I love this is it, it's good. The Democrats will love this because they want Ukraine to be on stable footing. And the MAGA people should love it too, because Europe is, is, is shouldering the burden. They're taking these assets, and it's good for American defense companies. Right? This is money that it's not like the Europeans are going to give that to European companies to buy weapons for Ukraine. The best weapons are made by US Companies. And the reason I think this is a great idea isn't so much that, you know, Ukraine fights on forever. Right. What you do is you change the dynamic on the battlefield. So Putin knows that Ukraine could fight on if it needs to for five to 10 more years. And we just got got over talking about, you know, 10, 15 minutes ago that Russia's economy is in a really bad place. And I think they only have one or two more years of Runway before things really go off the rails. So I think just by that sort of incredible vote of confidence in the Ukrainians and saying, look, you're not going to wait them out, Putin, sorry, you can't do that. I think then you really get Putin in the mind space for a real serious negotiation. Problem right now is I think Putin is still kind of sitting at the table saying, I have all the cards, I can get whatever the hell I want. Shouldn't be that way. The U.S. europe and Ukraine on one side of the table versus Russia, you have a coalition that could get a very good deal out of Putin.

[Tom Bilyeu]

It begs the question then, why isn't Trump pursuing that?

[Edward Fishman]

It's a good question. I don't know. Because, you know, I think Trump has effectively shocked the Europeans out of their slumber and they're now serious, taking seriously things like putting boots on the ground in Ukraine. Right. You have the British and French saying that they're willing to commit soldiers to a potential peacekeeping.

[Tom Bilyeu]

Oh, I hadn't heard that.

[Edward Fishman]

Yeah. Which is huge. Right? I mean, and not only is that great for Ukraine, but that's exactly what Trump has wanted. Like, he wants the Europeans to step up and do more militarily. Right. In terms of why he hasn't been pushing them to seize Russian assets, I don't know. And it's possible that some of this is happening behind closed doors. We don't know yet. I haven't heard a public argument in favor of it. And frankly, Biden should have pushed harder for it himself. I don't think Biden could have gotten it done because the Europeans probably viewed Biden as too much of a partner that they figured they couldn't listen to. They could ignore him if they wanted to, but I think if Trump went to the Europeans and said, look, the price of me continuing to stand with you guys was you taking these Russian assets, freeing, unburdening the American taxpayer from this issue, I think the Europeans would do it.

[Tom Bilyeu]

That's really interesting. Okay, so let me try to do the Internet's favorite thing and mind read Trump. Don't they ever love that you might

[Edward Fishman]

be able to do it?

[Tom Bilyeu]

Let's see. So, okay, he has made public statements that basically, if he can't get the deal done, he's going to let them fight it out. He's obviously made very public statements that this is a European problem and they need to be dealing with it. But if I'm Trump and I wanted to make sure that Putin understood that Zelensky was a credible threat, I don't know why he didn't really push that agenda. Oh, man. If I think like a writer and I say Trump wanted to get the credit himself, that's why he wouldn't try to make this a European thing. Like, hey, guys, you have all those assets, you should freeze them, give them to Ukraine. Part of it might be the messaging of, I just want the war to end. Because if you take Trump seriously and say, okay, this is somebody who just wants to see the killing stop, I can't reconcile two things. I believe him when he says he wants the killing to stop. And at the same time, if you want Ukraine to be strong so that you force Putin to the table, you would encourage Europe to get ready. Like, hey, boys, we've got the checkbook open. We're ready to go. Yeah, yeah. This is where I wish we had chat with us live. I'd love to see if anybody has, like, a different take on that. But the way that I reconcile that is he wants it to have been him that made the deal. He doesn't want to empower Europe to go make that deal and leave America on the outside. He wants to control the negotiations, and that means promising Zelensky in his own unique way that, no, trust me, if we intertwine our desire for the mineral rights, like, if we're together on that, then I'm going to do some unsaid thing. At least he hasn't said it publicly to keep you protected, but, yeah, at least live here in real time. I can't come up with an argument as to why you wouldn't. Other than that, why you wouldn't want Europe to be in the driver's seat.

Stick around, because after the break, we're getting into Trump's latest tariff strategy and whether it's actually going to work or

backfire

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[Tom Bilyeu]

All right, we're back.

Let's get into it.

[Edward Fishman]

Yeah, I mean, it's clear that Trump is very interested in the Nobel Peace Prize. I think that's actually, like, you know, it's hard to read Trump's mind, but this is one thing that, you know, he's talked about enough times that you realize, like, it's kind of one of the few things in life that he hasn't yet accomplished that he would love to have. So I'm, I'm with you, but I think that the Europeans aren't going to do this without Trump pushing them to do it. So I think he still winds up getting the credit.

[Tom Bilyeu]

Why?

Why wouldn't they? If the assets are frozen, do they plan to take them and just fund healthcare?

[Edward Fishman]

Yeah.

[American Express Announcer]

Right.

[Edward Fishman]

Just use them. To use them as, like a pillow or something. Yeah. I mean, look, I think that the Germans in particular have been wary of this, and the reason is that they worry that it would undermine financial stability in the eu, that basically no one would trust the European financial system and the euro would be seen as, you know, an unsafe currency to be.

[Tom Bilyeu]

And they don't think that's already happened just by the freezing?

[Edward Fishman]

They don't. But I, I'm with you. I, I find it to be a little confusing. What I will say, though, is you're about to have a political shift in Germany. Right. This was under the. The previous Chancellor, Olaf Scholz, who was a wet blanket, frankly, a very, very weak chancellor. Right. The new guy is coming in. Friedrich Meertz seems much tougher. And so we'll see. I mean, German politics are complicated. And so I think, you know, we're not exactly sure where things are going to head, but it's very possible that the German position could change. I think generally speaking, though, look Every American president in recent history has wanted the Europeans to do more. Right. They wanted the Europeans to do more in terms of, you know, helping Greece get out of the Eurozone crisis. They wanted the Europeans to do more in the fight against isis. They wanted the Europeans to do more with sanctions on Russia. Right. It's always like pulling teeth. I used to negotiate with the Europeans, too. Right. Because the Europeans are afraid that Trump will actually cut the cord. Right. That Trump may be willing to go where no U.S. president has ever even contemplated, which is like abandoning NATO. Right. Which I think would be very bad. So I hope he doesn't do that.

[Tom Bilyeu]

Because you think it would unleash Russian aggression or imperialism?

[Edward Fishman]

Yes, because they think that he might actually do that. They've kind of awoken from their slumber. Right. So if this is some grand strategy that Trump is actually. He doesn't really want to get out of NATO, but he wants the Europeans to truly believe that he's willing to do it. It is working. Right. I mean, the Europeans are getting much, much more serious about their own defense. I think that it's possible that the Europeans could come around to this issue of repurposing the Russian assets for Ukraine. And like I said, the US Government, the US Congress has already passed a law. It is the law of the land that we can do this. We have the authority to do it in the U.S. the Canadian government has the authority to do it as well. The British government has the authority to do it. So I think you'd have the other big members of the G7, the other issuers of the world's reserve currencies, like the pound and the Canadian dollar, ready to stand up and do this. The big question has been the Europeans, because most of these assets are in euros. The thing that's interesting, Tom, just like. And this is a story I recount in choke points, actually, and it ties back to something you mentioned earlier about, you know, is there a risk to weaponizing the dollar? You know, most countries hold the lion's share of their reserves in dollars. Right. 60% of all reserves in the world are in dollars. That's why you call the dollar the world's reserve currency. The second place is the euro, which is about 20%. Right. So the. The dollar's three times as frequently used in reserves than the euro. In 2018, Trump, in a series of a month, imposed really significant sanctions on a Chinese company called zte. He imposed sanctions on a Russian company called Rusal, which is the world's biggest aluminum maker. That was really catastrophic. For that company. He wound up pulling it back, both that and the ZTE thing. And he wound up pulling out of the Iran nuclear deal and reimposing sanctions on Iran. This was all in April and May of 2018. And that was kind of when the world woke up to, whoa. Trump is willing to really take some serious risks in economic warfare, like shooting from the hip, doing things that other presidents wouldn't consider. And what did the Central bank of Russia do? Literally the next month they took all their assets out of dollars and moved them into Euros. And it's because they thought that, you know, the US May not be predictable when it came to economic warfare, but the Europeans would never go along and actually do this. And I think that's one of the sort of little known successes of the last administration, the Biden administration, was they actually got the Europeans on board for these sanctions against Russia because that's what Putin wasn't expecting, right? He thought that, oh, maybe the US Would be crazy enough to sanction my Central bank, but the Europeans, you kidding me? The Euros, they're not going to do that. But they did. And as a result, Putin really wasn't expecting this act of economic warfare that they were hit with in, in February of 2022.

[Tom Bilyeu]

So how do company, or companies, how do countries like Russia, like Iran, how do they manage to survive when they've got such harsh sanctions?

[Edward Fishman]

It's a great question. Iran, it's hard, right, because Iran is comprehensively sanctioned. Like there is very few. I mean, as an American, you can't do any business with Iran. You know, we've got a full trade embargo, full financial embargo on. So they're very comprehensively sanctioned. We also have what's called secondary sanctions on Iran. So for instance, if you are an oil trader who wants to buy a barrel of Iranian oil, you yourself are risking getting sanctioned by the US So if you're a Swiss oil trader who buys Iranian oil, the US could sanction you, which means that you are then cut off from the dollar, which probably means you're going bankrupt, right? So Iran, it's very hard. And the way that they basically manage to do business in the global economy is through an incredibly complex patchwork of, you know, telephone relationships, right? And barter, you know, trading, literally bartering, trading. We trade you a good, you trade us a good in return. And no currency ever exchanges hands. There's a great story I recount in my book Choke Points. In the summer of 2022, the Russians seized a bunch of military equipment from the Battlefield in Ukraine, American military equipment, like drones and things like that. They then took that military equipment and put it on a plane to send it to Iran in exchange for about 500 million euros in cash that then came back on the, on the plane back to Russia.

[Tom Bilyeu]

Whoa.

[Edward Fishman]

So that's how they trade. Right. It's like, it's. And because you can trade actual banknotes, right. There's how you can't control that, but you can't make a wire transfer for Russia. It's a little different because Russia is not comprehensively sanctioned. Right. I mean, the sanctions on Russia are still, I would call them patchy. You know, the financial sector is pretty, pretty significantly sanctioned. The defense sector, the oil and gas sector. You know, Biden was pretty weak when it came to energy sanctions on Russia.

[Tom Bilyeu]

Wisely so. Or was that a mistake?

[Edward Fishman]

I think it was the biggest mistake of his Russia policy.

[Tom Bilyeu]

Whoa.

[Edward Fishman]

Because what Biden basically tried to do was he tried to maximize economic pain on Russia without touching the number one sector of Russia's economy, which is oil

[Tom Bilyeu]

and gas, because so many other countries were importing gas from them.

[Edward Fishman]

It's because inflation was at a 40 year high in 2022 and oil prices were over $100 a barrel. And ultimately the political advisors in the White House won out over the national security advisors, and they said, we can't do anything that's going to make inflation worse or that's going to make oil prices harder and hit Americans at the pump. So we just can't go there. And I think, look, he was right that inflation was a bad problem. In fact, it's probably a big reason that Kamala Harris lost the 2024 presidential election. But I think what it, it did was it signaled weakness to Putin and I think it allowed Putin to have much more Runway for this war than he would have otherwise had. So I think Biden, if you could go back in time, probably should have done much more aggressive oil and gas sanctions right at the beginning in 2022. If he had done it right then it would have shortened Putin's Runway for the war. And by the time you have the 2024 election, the economy would have adjusted. Right? You would have, you would've had things like more shale production in the US Taking advantage of the market signal of higher prices.

[Tom Bilyeu]

Ask about that. So how much of the drill baby, drill Trump mentality is going to help us inoculate ourselves or make it so that we can sanction them into oblivion if we so choose?

[Edward Fishman]

I think it will help, certainly. And, and, and you Know, one of, one of the key aspects of why the Iran sanctions leading up to the nuclear deal in 2015 were so effective. Those are most effective sanctions. Most effective act of American economic warfare in modern times were the Iranian oil sanctions from 2012 to 2013, in which in an 18 month period, the US takes off 60% of Iran's oil exports from global markets and locks up over $100 billion of Iran's oil money in frozen overseas escrow accounts. The reason that the US Is able to do this is because at the time, shale is pumping out so much oil that it's replacing all of the Iranian oil that's coming off the market. If Trump is serious about American energy dominance, which is what he says, and he's really willing to just unleash US Oil and gas, it's not enough just to take down regulations and stuff. Investors in the US Need a price signal. They need to say, okay, we know we're going to drill this well and we know we're going to be able to sell it for $80 a barrel or something like that. Right. And so I think that we're Trump to actually ramp up oil and gas sanctions on Russia, combined with the fact that he's being a bit more lax when it comes to regulations on the oil and gas sector, could be a killer combination. But so far, we haven't seen any evidence that he's willing to stick it to Putin. This is the thing that worries me, is that he seems very happy to apply pressure to Zelensky, but the guy who we really need leverage over, who's Vladimir Putin, we haven't seen as much.

[Tom Bilyeu]

All right, super risky, but what do you think causes that? Like, people want to believe that. I don't know. Either Putin says flattering things, that Trump is somehow getting kickbacks, or I don't know what they think, but that he is very much on Team Putin. Do you think he's on Team Putin or is this a dog who sees one potential enemy is weak and the other strong? And so I'm going to bite the weak one.

[Edward Fishman]

I do think Trump has a history of being more comfortable threatening small countries than big ones. Right. Like he. He does not. The level of kind of respect and almost deference he shows to Putin and Xi Jinping, he does not show to Justin Trudeau and Volodymyr Zelensky. I don't know what that is, but I do think that's a trend. Right. And it's not just Putin. It is also Xi Jinping, who seems to have quite a bit of leverage over Trump. In terms of Russia itself, I think there are a few things at play. One is that the Russians blatantly interfered in the 2016 US election. They clearly had a preference for Trump. This is an objective fact. Whether or not it helped him win, I think no one knows. Right. He may have won. Even if the Russians had done Nothing in the 2016 election, Trump may still have won. Right. But the fact that they did interfere in the election, that it was very clear that they did and that Trump won. I think Trump always sort of worried that his initial electoral victory was seen as illegitimate in some way. So I think on that simple count, he was sort of always a little concerned about Russia.

[Tom Bilyeu]

Did not want to make him know, tell Putin to fuck off. Like, you don't have anything to do with this. Like, I'm the big man on campus, like that. I don't know. Look, I've never looked deeply into that. I know some people are going to take super exception to the Russia, Russia, Russia hoax thing.

[Edward Fishman]

That.

[Tom Bilyeu]

That I don't know. But when I look at that, what do I think? I. My gut instinct is that Trump understands who is strong on the playground and who is weak. And it's so much more comfy to go after the weak person.

[Edward Fishman]

Yeah.

[Tom Bilyeu]

And especially if also, Trump really does want to make America great again. And what? Like, even if he only wants to believe that so he can end up on Mount Rushmore? Like, I don't need people to believe that he's doing it out of the goodness of his heart, but when you really think about what motivates a person, he wants to be remembered as a deal maker, as a peacemaker, as somebody who really like, regalvanized America, then all of a sudden it makes sense. Like, if, you know xi's gonna be important, you've got to keep him at bay. You know, that Russia, at least they're important on the world stage. They're nowhere near somebody like. Like China, obviously, but they are certainly meaningful on the world stage. There might be something there with Europe, in terms of he's sort of European. And so there's like, I. I think he's got enough beef with Europe that there might be something there. But anyway, that. That feels right to me, that, okay, I know strategically who I need to not push so far that they become aggressively antagonistic towards America. I mean, if nothing else, Russia still has a whole lot of nukes.

[Edward Fishman]

Totally.

[Tom Bilyeu]

So wanting to actively piss off Russia, probably not pissing off Ukraine, probably not as big of a deal pissing off Canada, I'm definitely not worried about that. Pissing off Mexico, not super worried about that. And I've got, like, America behind me on the anti cartel stuff and the immigration stuff. So I don't know, like, all of those feel relatively politically wise. The only one that has this big question mark is the. Certainly the Democrats despise his treatment of Putin. And so I'm always a little shocked that he's still somewhat soft on him because he has a perception problem if nothing else.

[Edward Fishman]

Yeah, I agree. In some ways, it would be the easiest way for him to silence critics would be to go out and do something really tough against Russia. And, you know, two days into his presidency, I think it was January 22nd, so not, not too long ago, though it feels like a lifetime ago, he put out this post on Truth Social saying that if Putin doesn't end the war, he's going to face incredibly high levels of tariffs and sanctions. And I think he signed off saying, you know, Putin can do this the easy way or the hard way, and the easy way is always better. And for Russia watchers like me, this really, you know, raised my antenna because I said, I've never heard Trump say anything like this. Right. I mean, you go back throughout his entire first term, he's never said anything even remotely threatening against Russia. But this was a very clear, almost an ultimatum that was delivered on Truth Social. We haven't seen anything really follow up from that. There's not been any action to back that up. So I don't know where that came from. But in some ways, Tom, I think if he were to do more of that, it would, A, give the US A little bit more leverage over Russia and B, silence some of those domestic critics who are saying, wait, why is he, you know, so, like, unwilling to criticize Putin? Yeah. I think the other thing, though, and this is, this is important, I think seems like he has some affinity for Putin and Russia. He clearly hates Zelensky. Right. And. And I think that he associates Zelensky with his first impeachment.

[Tom Bilyeu]

Right.

[Edward Fishman]

Because it was all about a phone call that he had had with Zelensky. Obviously, Zelensky wasn't the one who pushed for his impeachment or something, but he's associated with that. And I do think that there was some concern, certainly J.D. vance has this concern. He said as much in the Oval Office that Zelensky actively wanted Kamala Harris to win the election. And so I think that Trump does not like Zelensky as a human being and probably has better feelings toward Putin. And we, we know that Trump is a very, you know, kind of relationship based guy. Right. Like he, he thinks that, you know, US China relations are really Trump Xi relations, you know. Yeah, that's interesting. And so I think that there's some element of that too.

[Tom Bilyeu]

Very interesting.

[Edward Fishman]

All right.

[Tom Bilyeu]

I'm deeply interested in cryptocurrency, especially bitcoin. How much does that, which strikes me as a largely youth led movement, youthish led movement to reimagine the financial system. How much does that erode economic warfare and make it impossible? Because if they have a totally separate system, are they going to be able to impose the kind of sanctions that they can now?

[Edward Fishman]

Yeah, really, really important question. So again, the choke points in the title of my book are these parts of the global economy in which one country has a dominant position and there's very little redundancy. So right now in finance, dollar is the only game in town. Right. I say in the book, trying to do business across borders without access to the dollar is like trying to travel without a passport. You can't do it. Right. What I will say though is that choke points are not immutable. They come and go. In fact, they're created by entrepreneurs, they're created by businesses who are building new products that beat the old guys. And then all of a sudden governments realize that, wait, I have this resource at my disposal. Do I think we're on the verge of a fundamental shift in the way payments happen in the United States? Yes, I do. I think that the current dollar based payment system that we rely on for international trade, and even when two non US countries, even when India and Saudi Arabia are trading with each other, they're using the dollar. It's going through a correspondent bank account on Wall Street. Right. That process was built in the 70s and it still takes days to clear international bank transfers using stablecoins or central bank digital currencies. This process could take seconds. It's a better process. Right. I think that digital currencies, whether or not they're cryptocurrencies or state backed digital currencies, will disrupt international payments in the next five to 10 years. What I will say though is that that doesn't necessarily mean that the US will have less power. If it's a digital dollar or a stablecoin that's pegged to the dollar, or a US company that is putting out this digital payment system, the US government may have even more leverage to wage economic warfare because all of a sudden these things are, all these transactions are happening in bits and bytes. That could be going through US Servers that are, you know, companies that need to comply with U.S. law. And in fact, the single biggest sanctions enforcement case of the last few years was a $4 billion fine against Binance, the cryptocurrency company, which the CEO also had jail time. Right. It was a $4 billion fine. So clearly the long arm of the U.S. sanctions enforcement state applies to crypto. The thing I'm worried about is that it could be China that wins this race. And at least when it comes to state backed digital currencies, the currency in the lead is the digital rmb. You know, China launched a central bank digital currency about four years ago. The Fed has not done anything like this. And the digital RMB is by far and away the leader in this space. China has also created a platform called mBridge where different central banks can use their own digital currencies to settle trade between each other. So that example I used before of Saudi Arabia and India trading with each other, if they're using Enbridge, they don't have to go through a correspondent bank account in Wall street. And that transaction could clear in a few seconds instead of a week. So I think it's time for the US to get in the game. We need to win the race for digital currencies for us to retain this leverage. And we actually have to take steps, in my view, to actively undermine these projects that China's putting forward. We shouldn't allow US Banks to participate in China's alternative to Swift. You know, there's a program that China has called SIPs or CIPs, the Cross Border Interbank Payment System. That's an alternative to Swift, which is the financial messaging service that most banks use today. Right now, US Banks can participate in this. I think that's pretty foolish. So I think the Trump administration, if they're smart, will both do what they can to ensure the US Wins the race for the kind of the payment system of the future and also take steps to prevent China from gaining ground.

[Tom Bilyeu]

Coming up, we're talking about why Putin's latest move might be his most desperate yet and how it could shake up global markets. Do not go anywhere.

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[Tom Bilyeu]

All right, we're back.

Let's get into it.

[Edward Fishman]

Interesting.

[Tom Bilyeu]

Now, I don't know enough about the digital rmb, but is, I assume it's a cbdc. Okay. And are you saying the US should do one?

[Edward Fishman]

I think we should, yes.

[Tom Bilyeu]

Cue people going crazy in the feed. Okay, so I have a super negative outlook on CBDCs from a just control standpoint, given the Biden administration's absolutely anti crypto stance. Debanking people, all of that. Like, that feels like some real 1984 shit.

[Edward Fishman]

Yeah.

[Tom Bilyeu]

So do you see a difference between that and a stablecoin? Like, are they either one you're happy with or you're like, no, no, no, it needs to be a cbdc.

[Edward Fishman]

Look, I, I think that if you had a stable coin that was actually as good as a dollar, right? And I think that so far it's, it's hard to say because the volumes aren't big enough to really be tested. Right. I think it would be just as good as a cbdc. So what I'm, what I'm really saying is we need the US to win this race. I personally am a little skeptical that a privately organized stablecoin could compete or could be treated as the equivalent of a US dollar with a full backing of the US Federal Reserve if it could buy, you know, more power. More power to whoever is able to do that. It's just, it's, it's. It would be historically unusual for that to, to work. And I worry that as we sort of sit here in the US debating whether or not we should have this, China's actively gaining ground with their own state backed digital currency.

[Tom Bilyeu]

Don't you think that's like some evil empire stuff though, where they're like matching it up with all their desire for control and their social credit score? Like, it feels so dystopian.

[Edward Fishman]

It is dystopian. And that's why I think we need to defeat it. Right. And I think it's. You can't you can't.

[Tom Bilyeu]

China like you can't do a more control cbdc?

[Edward Fishman]

No, but I'm not saying that. So you could build safeguards into our cbdc, Right.

[Tom Bilyeu]

You know, tell me more. What, how do we build safeguards from.

[Edward Fishman]

Well, you shouldn't. I think the US government shouldn't just be able to cut off American citizens from bank accounts. That's crazy. That is. Should we be able to bar foreigners from using our central bank digital currency? Of course. That is what sanctions are for. Right? Why, why should we allow Iran to be using tether to fund its nuclear program? That doesn't make any sense to me.

[Tom Bilyeu]

You know, what do you think about this may create a choke point that I'm going to be uncomfortable with, but what do you think about. So if a stablecoin is backed by say U.S. treasuries 1 to 1, does that meet the needs? You're trying to get to where we can stop foreign adversaries but still not trip up a citizen, or does that still just give them too much control where they can say, I don't, I don't even know how they would stop them from using debt, but presumably they could.

[Edward Fishman]

Well, this is a broader point. Like I find it interesting and this could be my own background. You know, I'm, I'm one of the few people who, I've worked in government and I've worked in tech. So I've seen both sides, both sides of the equation. And I find it interesting that some people are like, oh, it would be so terrifying for my whole life to be dependent on, you know, the Federal Reserve. Right. And they could, you know, freeze my bank account. Right. But they're totally fine with, you know, Mark Zuckerberg potentially being able to freeze their bank account, you know, and, and,

[Tom Bilyeu]

and because of something like Libra you're talking about.

[Edward Fishman]

Yeah. And actually Libra plays a role in my story. One of the things that's really fascinating about Libra, about Libra, is that Stuart Levy, who was actually the brought in to be the CEO of Libra, which then became Diem, pioneered US financial warfare. He's the one who created the Iran sanctions playbook. That's interesting. In the 2000s and 2010, for people

[Tom Bilyeu]

that don't know what Libra is, please let them know.

[Edward Fishman]

So Libra was a Facebook backed digital currency that was supposed to be basically something that could eventually be as good as the US dollar and the US government actively undermined it. And I think Janet Yellen, the Treasury Secretary in the Biden administration, is the one who sort of put the nail in the coffin when she told the Libra folks that she wasn't going to support it. And I think there was a lot of concern in Washington about the power that Facebook could have. And we're talking about. You mentioned what would a stablecoin that was fully backed by US Treasuries, would that be a serious competitor to the dollar? I think there are very few companies that have the balance sheets to actually do that credibly. Facebook was one of them. Meta. One of the, you know, the most valuable companies in the world potentially could actually do this. And given their user base between all of their various apps, I think it was a real threat. The thing I think is actually a little bit tragic is, you know, knowing Stuart Levy personally, he's literally the founding father of American sanctions policy. He is as patriotic as they come. He was appointed by George W. Bush in 2004, and he was kept on by Barack Obama in 2009. If he's running the thing, I wasn't particularly worried about it being used to fund Hamas or Hezbollah. In fact, quite the opposite. I think that was a good chance for the US to actually have digital currency innovation that complied with our national security priorities. The thing I worry about now is some of these other stablecoins that don't have anything like that level of seriousness and compliance at the top. They are being used, you know, for very, very nefarious purposes. And that's why you see, you know, you saw Binance get into the trouble that they got into because they were being. Their platform was being used for all sorts of bad problems.

[Tom Bilyeu]

Yeah. Crypto is one of those where I'm very glad that it exists from the ability to opt out of inflation. But I'm always shocked that governments allow it. It's one of those where I'm like, it's pretty powerful to be able to print money. I hate it. I am violently opposed to it, but I get why they want to do it.

[Edward Fishman]

Yeah. The thing that's interesting and one of the. Another interesting sort of story I tell on choke points is the way we got the current financial system we have today, where the dollar is just everywhere. Right. I mean, it's, again, you need it to operate in the global economy. It really came about in the 1970s when Richard Nixon pulled the dollar off of the gold peg. In 1971, it's called the Nixon Shock, where he gave a speech basically saying, effective right now, the dollar is no longer convertible at $35 an ounce for gold. And that was the Central pillar of the Bretton woods system, the global economy built after World War II. Right. A big reason that that happened was this thing called the euro dollar market. It's a very jargony word, but basically what it meant was in the 60s and in the seven into the 70s, European banks started issuing dollars that were not backed by the Federal Reserve because they're European banks, they're not regulated by the US Government. It was effectively an illicit market. It was similar to crypto. And the US Government could have easily shut it down. Right? They could have told the London banks who were issuing dollars, these aren't dollars, you know, what are you doing here? But we actually came to like it because it wound up being a way for us to plug the deficits that we were running out with the Vietnam War. And so over time, this sort of like illicit market, the Eurodollar market, gets this stamp of approval by the US Government and becomes like the central infrastructure of the global financial system. So in some ways, I think there's an interesting parallel to what you're seeing with crypto today, where the private sector sort of creates this like, you know, semi illicit market that's like these, like pirates, you know, who are creating it. And then all of a sudden the U.S. government says, wait, we're going to assert control over this thing and we're going to use it to our own purposes.

[Tom Bilyeu]

I mean, the whole idea behind Bitcoin is that they won't be able to do that. Now the other stuff that, that I have less conviction on, but the idea with bitcoin is that because they have broken free of the gold standard and now can print as much as they want, they're still stealing your buying power. They are taxing your buying power, I'll use a friendlier word. And bitcoin was a response to that. So, man, if, if any one government is able to get enough of the network, I suppose it's possible, but it seems highly unlikely at this point. So fingers crossed, because that is, while I hate the idea of treating it like a life raft, you don't know me well enough to know how much my audience has heard me rail about inflation, money printing. I think it is a grand evil. Bitcoin, they call it the life raft. I hate that because the average person doesn't, one, it's too volatile still. And then two, the average person just, you're asking them to take a huge gamble on something that's only been around for, you know, less than two decades. So I hate that people need a life raft. But at least there is one.

[Edward Fishman]

I'm with you, by the way, on inflation. I think in some ways, you know, many Americans who are experiencing inflation for the first time really in the last few years because we had been going through such a long period of price stability. But inflation is the, is the kind of the rising tide that sinks all boats, right? It's bad for everyone, it's bad for the poorest, it's bad for the richest. And so.

[Tom Bilyeu]

But if you've got a mega yacht, that water can rise a lot farther before you feel it.

[Edward Fishman]

That is true. That's true. And so look, I think that, I think that it's high time for us to take these issues seriously and worry about inflation, worry about just printing money willy nilly, worry about fiscal discipline. I think the thing that is a tough pill to swallow though is the way for us to deal with these things is through increasing taxes. Right. I mean, it's very challenging for me to see how the US Government can stop being so dependent on debt without higher taxes. I mean, cutting spending is obviously a good thing. I think that's well warranted. And I hope.

[Tom Bilyeu]

Do you think higher taxes on the current amount of GDP or you're saying increase GDP so that there's more tax revenue coming in?

[Edward Fishman]

You need both. Right. I think the idea that you can grow the economy so quickly, that you can lower taxes and raise more money is a fool's errand. It's, it's something that I would love to, to happen, but it's like, you know, when I was running for president of my fifth grade class and promised everyone more recess. You know, it's, it's, it's not going to happen. You know, you might get elected saying it, but it's, you know, and this is, this has been the story, I think, of a lot of presidencies in the last 30 or 40 years where presidents come in saying that they're going to take, you know, deficits seriously and debt seriously and then they lower taxes and they just worsen the deficits. And you know, it was actually only in the 90s where the last time we had a balanced budget. So I think these things are important. I think it's important to cut spending. There's definitely some waste, fraud and abuse in the U.S. government that I hope is cut. But if you look at the main spending categories of the US government, it's defense, which I think if anything needs to grow, given the geopolitical environment, it's healthcare, which we've got an aging society. There's not, we can't. There's nothing we can do about that. And we cover everyone who's 65 and above, I think for good reason. And it's Social Security. Right. All the other stuff is tiny relative to those three categories. Could you cut some spending? Yes. But the real thing you need to do is both grow the economy faster and not only raise taxes, but I think more importantly is simplify the tax code. Right.

[Tom Bilyeu]

I mean, now you're singing my song.

[Edward Fishman]

Yeah, I think, like, I mean, I don't know about you, but, you know, you, in some ways you're just like, I don't care if I'm taxed more, but just like, make it easy, like, tell me that I'm just going to be taxed. I clear percentage on what I make.

[Tom Bilyeu]

I'll be very, very honest. So because I live in California, I'm taxed at over 50%.

[Edward Fishman]

So I am too, by the way, in New York. It's terrible. It's very, very painful.

[Tom Bilyeu]

So here's my take on that. If you tax the wealthy at 100%, you still don't solve your spending problem. So given that you can tax them literally at 100% and you don't solve the problem, you have a problem that needs a solution other than more tax. I don't know that lowering taxes is the right answer, but I will say that you're going to have to increase GDP and you're going to have to find a way to balance your budget, given that. Now, why do I say that? Because as you said, the servicing the debt is rapidly. It just surpassed your military spending. It will surpass all of your entitlements. It will become a beast. By the. If we keep spending at the current rate that we're spending, deficit spending by the2040s, it's like, it is your biggest expense by like some grotesque margin.

[Edward Fishman]

Yep.

[Tom Bilyeu]

So it is a snowball that only gets bigger. So it, it is not optional to get your spending in line. So you either have to do it by making more money and again, you can tax the rich at 100%. It won't get you there. So for people that, that want to pull that lever, I get it, but it's, it doesn't actually get you there. Also, the vast majority of humanity does not understand the difference between being a billionaire on paper and having a billion dollars in your bank. They do those. It's phantom money. They would have to sell their shares in their company, which they may or may not be able to do. And as they start selling it's going to drive the price down. So, yeah, this is a very complex issue that comes back to, as Milton Friedman said, there's no such thing as an unbalanced budget. If you're spending 6 trillion, they are taxing that money in the form of inflation. If they're only getting in tax, whatever, 4.6. So, man, here's where I wouldn't mind being taxed more if the outcomes were awesome and the outcomes are trash. And so I've lived in LA now for 30 years more and I'm just watching it move in the wrong direction and companies are fleeing, dude, in and out. The burger joint is now moving to Nashville, I think.

[Edward Fishman]

Oh no. So, yeah, so it's like California anymore

[Tom Bilyeu]

now, dude, they are, they are making mistakes of the most egregious kind. Not recognizing the second and third order consequences of when you just try to tax, tax, tax and spend it with no sense of like, what is my outcome? People leave, they vote with their feet.

[Edward Fishman]

Yep. And we're seeing that happen. I'm, I'm, I'm with you. I think we need to demand the best government that we possibly can get. Right. Because every single tax dollar we have. I'm, I'm worried about Doge, to be honest, because I think that what they're doing, and just to be clear, what they've done so far is they've given orders to fire all the probationary employees. So what is a probationary employee? It's somebody who's been in the US government for less than two years. So it means that they have, don't yet have civil service protections. So you can just fire them. Right. These are recent law school graduates, recent business school graduates, recent public policy school graduates. They're people who are willing to work 12 to 16 hour days. They don't have kids, they're extremely smart, they're hungry. It's basically like you're firing all of the highest potential, hardest working people and the cheapest employees. People are getting paid $60,000 a year and sparing the actual fat cats. You know, people who've been there for 30 years, who may work six hour days, if that, and are making $150,000 a year or even $170,000 a year. So I think the indiscriminate aspect of it is problematic. And I can say this firsthand because I've worked in the government and I know the people who work the hardest are actually young people. Right. It's, you go to Washington, you'll be surprised by how many 25 and 30 year olds are doing really big things because in order, you know, there's a, the US government, you know, even with, compared to the biggest tech companies, there's no problem set like what the US government has to deal with. Right. There's a limitless amount of things to do. And so if you're a young person who's hungry, there's a lot of opportunity for you there. And so I worry about firing the highest potential, smartest people. And I've seen it even now. I mean I, I teach, I teach a graduate at the Graduate School at Columbia University. And I've been preaching to my students for years that you know, you could go make a ton of money on Wall street, you can make a lot of money in Silicon Valley and I, in fact, it's great, go ahead and do that. But now while you're young and hungry, go work in public service. You know, be patriotic, make your country better deliver, you know, national security wins for the American people. And I'm grateful to say that I have over a dozen of my students who are at places like the Treasury Department or State Department and Commerce Department doing really important things, working on out competing China in tech, or working on, you know, making the US independent on foreign sources of energy and critical minerals. And these, these students of mine are worried that their jobs are at risk and for no reason, not because of their performance, but just because, you know, these are the only people that, you know, Doge thinks they can fire because they've worked there for two years. So if, if, if you wanted to do a top to bottom personnel review in which you fired the least productive workers and you raised the standard, raised the bar for what you expect of a US government employee, I am all for it. We need the best and brightest in our government. But I think the way that it's been handled so far, I don't think is actually driving toward that goal.

[Tom Bilyeu]

Yeah, I mean I'm, I look at it and see the greatest capital allocator certainly of our time. You've somehow managed to get him for free in the government, who's done the largest, as far as I know, the largest corporate turnaround ever. And he's doing what he can in terms of if you've got some people that are protected and there's no way that you can fire them, well, obviously he's not going to focus on that because he's got to deliver results quickly. You have a political reality to face, which is you've got to get some wins under your belt fast. The Thing that I'm drawn to though, with Doge is just give me transparency. I want to see it all. I want to see where this is going. I want to see all the dumb stuff like the rate that people can retire is tied to the speed of the elevator in the mineshaft that they put the paperwork in. I still can't believe that's real. That's crazy. And so getting somebody in there and starting to pull this stuff into the light, publishing out on a website, these are all the things that we're doing. I think that's good. Some of it is probably just theatrical and isn't like the real substantive thing, but at least capitalizing on this moment where people really want change and going, cool, like we're going to mix this up, we're going to start forcing transparency, we're going to start holding people accountable and then hopefully over time, to your point, I mean, you outline this so well in the book that you start doing these things. In the beginning, they're like these awkward sanctions and they work a little bit, but they had this knock on effect that you didn't realize what happened. And so now you address it and you begin hardening it over time. If we can over time start doing like you're saying. I mean, one thing Elon has said is pay government employees more, not less, because there's a corrupt forcing function where they're living in Washington D.C. one of the most expensive places in the world, with a terrible school system. So they want to send their kids to private schools. So it's like, oh God, if I take this lobbyist money and you get this system that deranges itself. So getting everything transparent, getting everybody to want the government to be audited, which I still can't believe people are pushing back on that, that kind of change, at least directionally, is going in the right place.

[Edward Fishman]

I'm all in favor of transparency. I think that transparency is wonderful and I encourage that to pivot back to the books. I'm glad you brought this up. I think that there is actually something Doge could accomplish when it comes to economic warfare and geopolitical competition. I had the good fortune during my time in government to do a tour of duty in the Pentagon where I worked for the Chairman of the Joint Chiefs of Staff. Marty Dempsey is a four star army general and I was kind of the token civilian who got to work on his strategic planning team. And it was helpful because I got to see what the US Military and the Pentagon does when it comes to planning for the wars of Tomorrow. You know, when you think about something like a potential Chinese invasion of Taiwan, right. Actively, every year, they're not only coming up with different military options that could be used in such a scenario, they're rehearsing them. That's what a military exercise is. You're actually testing this out, right. You're literally going out there and, you know, seeing what might go wrong. You're war gaming these things and you're updating your plans. Right. Your troops are professionally recruited and trained over decades of their lives. Right. This is why we have the most lethal fighting force in the world when it comes to economic warfare. I mean, we are a patchwork. Right? You've got the Treasury Department, you've got the Commerce Department, you got the State Department. You've got different officials at the White House. Frankly, if you read my book, it's focused on individuals. It's focused on people like Stuart Levy, who pioneered different uses of financial sanctions because it takes policy entrepreneurship to succeed in that kind of system. Right. There's not a Pentagon for economic warfare. And as a result, I also am concerned that we're falling behind other countries. You know, China does have a much more streamlined process for doing these things. Even Japan just recently created a cabinet minister for economic security. Right. They. So like we have the Secretary of Defense, they have a minister for economic security. Right. I think Doge would be wise to think about not necessarily cutting money into economic warfare. If anything, we need more money for these things. But. Right. Sizing how the US Government does it. Right. Like going back to the drawing board and say, if we really want to fight and win the economic wars of tomorrow against China, against Russia, how do we need to structure our government so that we're not playing games at telephone and arguing with each other all day and what we're actually position to win? And I think that would be a very beneficial thing. And I would love to see Doge and Elon Musk put their time and attention into that problem.

[Tom Bilyeu]

Economic warfare, man is crazy. Where can people follow along with you?

[Edward Fishman]

Well, first of all, I would highly recommend that you read my new book, Choke Points.

[Tom Bilyeu]

I can vouch for it. It's fantastic.

[Edward Fishman]

Appreciate it. And the Wall Street Journal just called it one of the 10 best reviewed books of February, which let's go honor. An honor. And if you do read it, please reach out to me. I'm available on X at Edward Fishman, so you can, you know, send me a note there. And I'm. I love hearing feedback. I've already. The book came out on Tuesday, February 25th. And I've already had, you know, over a hundred messages from early readers asking me questions, making comments. I love that, you know, the thing as an author, you sit in your office for several years writing, and the thing that's most satisfying is when a reader picks up your book, reads it, and it sparks a new idea. And sometimes it changes my own thinking. So please reach out to me. I'd love to talk to you about it.

[Tom Bilyeu]

I love it. Awesome. Well, guys, if you haven't already, be sure to subscribe. And until next time, my friends, be legendary. Take care. Peace.