“Stephen G.” is a UPenn graduate who studied East Asian Languages and Civilizations. He was also a Reischauer Scholar through SPICE, Stanford University.

“Humans will be completely freed from work in the end, which might sound good but will actually shake society to its core… you could even say the mark of success for this AI revolution is that it replaces the vast majority of human jobs.” This is the warning given by a DeepSeek spokesperson at the World Internet Conference in Wuzhen 乌镇 in November 2025. He called on AI companies to alert the public regarding which jobs could be eliminated first. While the risk of job loss looms large around the world, China faces unique challenges due to domestic economic headwinds coupled with high expectations for AI.

The Chinese State Council published its ambitious “AI+” initiative in August, aiming to have AI devices, agents, and applications reach a penetration rate above 70 percent across society by 2027 and 90 percent by 2030. Beijing wants AI to serve as a new engine of economic growth and productivity increases. But how will China navigate the challenges of adopting AI while softening its impact on the job market? As China marches toward an AI-powered future, what strategies could policymakers develop to uphold the social contract between the party and the people?

China’s Labor Market

Since the pandemic, China’s youth unemployment rate has stayed high; in mid-2023, it reached a historical high point of 21.3%, nearly double the pre-pandemic rate in 2019, prompting the National Bureau of Statistics to suspend publication of the data. Reporting only resumed several months later using different metrics. However, joblessness data under the new metrics reached another record of 18.9% in August 2025 for “unemployed youth aged 16-24 who are not in school ” — and many believe the true figure to be much higher.

Besides, a vast number of low-skilled workers have lost stable sources of income and now rely on the gig economy. According to RAND, hundreds of millions of rural workers have become unemployed due to the housing-market collapse and the contraction of low-skilled manufacturing. Many of them now drive for ride-hailing or delivery apps, which offer little financial security or potential for upward mobility.

Defending Humans

While US coverage of AI-displacement often tends toward pessimism rather than workable solutions, the Chinese government has taken action on the issue — to an extent. In a December 2025 employment arbitration case, the Beijing Municipal Bureau of Human Resources and Social Security 北京市人力资源和社会保障局 stated that “AI replacing the job function” is not a legally valid reason for employee termination. The case involves a tech company that eliminated an employee’s position due to AI, framing automation as “a material change in the objective circumstances since the labor contract was signed 劳动合同订立时所依据的客观情况发生重大变化”. Nonetheless, the arbitrator ruled the termination unlawful, noting that a “material change” must be unforeseeable and caused by force majeure events such as natural disasters and policy changes. In contrast, the company’s adoption of AI technology was a voluntary business decision. As a result, the company was ordered to pay ¥791,815 ($113,956) in compensation for unlawful termination.

In China, employment arbitration cases typically reference precedents set by the local high court, the labor arbitration committee, and the Bureau of Human Resources and Social Security. According to a Beijing-based lawyer, this arbitration case will serve as a reference locally and could influence arbitration decisions in other provinces, especially in northern regions.

The Beijing arbitration authority further noted that under such circumstances, employers should first consider contract modifications, retraining programs, or internal transfers to accommodate affected employees. Multiple state media outlets covered the case, describing it as “setting a new benchmark 具有标杆意义” and “giving workers peace of mind 给广大劳动者吃了一颗定心丸.” Against a backdrop of heightened public anxiety over unemployment, Beijing is signaling to private-sector employers that they cannot use AI adoption as a legal justification for layoffs. But even with restrictions on layoffs, firms often circumvent statutory protections through attrition, short-term contracts, and labor dispatch arrangements. The ruling’s practical impact therefore remains uncertain, given the historically questionable enforcement of labor laws in China.

Online commentaries also raised doubts on whether the ruling will meaningfully protect workers going forward. On Zhihu, many users argue that the case is yet another example of companies pursuing layoffs without paying severance. Since most employees would not pursue the tedious arbitration process, in part due to the fear of harming future job prospects once they have an arbitration record, employers face little risk — the worst case would be paying the severances that the employee deserves initially. Multiple follow-up comments lament the absence of more punitive measures for employers in Chinese labor law.

While their implementation may fall short, more laws and regulations on AI automation can be expected. On Jan 27th, 2026, the Ministry of Human Resources and Social Security has announced that China will issue official documents to respond to the impact of AI on employment. The November 2025 issue of Study Times 学习时报, an official newspaper of The Central Party School 中共中央党校 (where elite CCP cadres get trained), also discussed legislation to manage job displacement. It recognizes that the trend of AI automation eliminating jobs has been accelerating, and that China’s current laws and regulations need to catch up.

One can look at previous evidence to gauge how such legislative efforts may unfold. Public opinion on matters regarding labor conditions has swayed the Chinese government’s regulatory response before: In September 2020, an investigative article by Renwu 人物 sparked public outrage for the plight of delivery drivers, which prompted state media to criticize the delivery platforms. Policy response came during the summer of 2021 with two new regulations on algorithms. The first required the platforms to adopt a “moderate algorithm 算法取中” that loosens up time limits on delivery, instead of the “strictest algorithm” that had forced drivers to break traffic rules in order to be “on time”. It also emphasized that drivers’ earnings must not fall below the minimum wage. The second, issued as part of a broader regulation governing internet platforms’ recommendation algorithms, mandated that companies file detailed algorithm disclosures.

The process through which China produced regulations on AI-systems themselves — including recommendation algorithms, deepfakes, and generative AI-outputs — could also help us predict how the state might respond to AI-led job displacement. Matt Sheehan of the Carnegie Endowment for International Peace reverse-engineers China’s AI regulatory development and outlines a four-layered policy process: real-world conditions; Xi Jinping and CCP ideological framing; the “world of ideas”, consisting of think tank scholars, AI scientists, and corporate lobbyists, etc.; and finally, the party and state bureaucracies. To date, much of the regulatory design has occurred within the latter two layers.

Applying this framework to workforce disruption, expect that labor-market shifts will be framed as a priority issue since they are core to Chinese social stability and common prosperity. Then the issue would command policy debate: journalists may spotlight the plight of workers displaced by automation, while corporate actors emphasize productivity gains and global competitiveness. Sheehan observes that AI-system governance currently allows relatively wide space for policy debates, in part because the field is new and competition among bureaucracies has yet to solidify.

A similar dynamic could shape regulatory responses to AI-induced displacement, allowing for more input from think tanks, media, and businesses. Although China has extensive experience managing unemployment, AI-related disruption may differ in its pace, scale, and breadth of sectors affected. This distinction may prompt policymakers to treat AI-driven job loss not merely as cyclical unemployment, but as a structural governance challenge.

Potential upcoming policy initiatives highlight the state’s plans to protect people’s livelihoods while technology rapidly advances. Study Times emphasizes that industries should adopt new technology in “human-machine coordination 人机协同” and “scientifically adjust the level of automation to materially improve employment stability 科学调节制造业自动化程度.” In the AI+ plan, the term “human-machine coordination人机协同” also appears in the first paragraph. The term has been defined as “the process of humans and intelligent systems (including algorithms, artificial intelligence and robots) completing tasks together”.

This concept has been further interpreted and is being put into practice. Cai Fang 蔡昉, a prominent Chinese economist and president of the Labor Economics Society 劳动经济学会会长, argues that AI should be guided by policies that prioritize human-machine collaboration over efficiency gains from automation alone. Some current AI applications in China reflect this awareness. For example, robots from Unitree have become “AI Physician Assistants”, making clinical rounds as part of a “human-machine-coordination multidisciplinary team (MDT) 人机协同MDT” at Fuzhou University Affiliated Provincial Hospital 福州大学附属省立医院. Unlike Silicon Valley companies bragging about being “fully AI native”, official directives in China often prominently display human involvement and show a clear intention to manage AI’s threat to the workforce.

Proposals and Challenges

Proposals addressing AI-driven labor concerns are abundant in China. During the 2025 Two Sessions meeting, Liu Qingfeng 刘庆峰, the CEO of iFLYTEK 科大讯飞 and an NPC (National People’s Congress, which generally rubber-stamps decisions already made at the highest levels of the CCP) deputy, suggested “AI-specific unemployment insurance AI失业保障专项保险”, a 6-12-month grace period for layoffs, and more job-oriented curriculum at universities and trade schools. For low-income communities, he emphasized that the state should provide free upskilling. He also recommended building a “‘monitor, alert and respond’ system that dynamically tracks employment status 就业监测-预警-响应”全链条监测机制”, with pilot rollouts in the Yangtze and Pearl River Deltas. The platform would require businesses with extensive AI-usage to provide data on job replacement to predict unemployment risks.

During the Two Sessions, Guoquan Lü 吕国泉, the All-China Federation of Trade Unions chief of staff, also highlighted practices in Spain, Korea, and Japan that China could adopt, such as limiting enterprises from replacing more than 30% of workers in a single position, requiring a portion of automation-driven cost savings to be allocated to employee upskilling, and levying additional taxes ranging from 0.5% to 3% to fund unemployment benefits. Chinese authorities could take similar measures in the near future, which would put more pressure on companies already navigating brutal competition, tariff wars, and domestic deflation.

Besides policy proposals, several structural conditions in China may soften the impact of AI-led displacement. First, the relatively low cost of labor reduces firms’ incentives to replace workers, particularly when the technology is immature. A Chinese manufacturer interviewed by Nikkei Asia states that his automated production line equipment is sitting idle due to the high start-up cost of operating them. Instead, he continues to rely on the experienced workers who can “make better clothes than what machines can do now.” Such dynamics create a buffer against rapid job loss that many Western economies do not share.

Some believe that SOEs could absorb both new graduates and workers displaced by technological changes. In China, “employment within the system 体制内工作“ — which includes positions in government agencies, public institutions such as schools and hospitals, and centrally or locally-affiliated SOEs — has long been considered an “iron rice bowl 铁饭碗” that offers exceptional job stability for both employees and society at large. Helen Qiao, a managing director and chief economist for Greater China at Bank of America, told Nikkei in December 2025 that Chinese graduates may face less AI-led disruption than their American counterparts since “SOEs will continue to shoulder some social responsibility, cushioning the impact.”

Indeed, SOEs have helped stabilize employment to an extent. Regarding youth unemployment, many localities have issued policies encouraging SOEs to recruit more college graduates, with some regions requiring that at least half of new hires in SOEs be recent graduates.

Nonetheless, “employment within the system” is unlikely to serve as an effective employment buffer under China’s current fiscal environment. Local governments are under significant financial strain — in China’s fiscal system, they bear primary responsibility for funding government agencies, public services, and local infrastructure. Yet while a large share of China’s tax revenue flows to the central government, local governments have become significantly indebted and are under huge financial pressure. Local civil servants, whose salaries come directly from the local government budget, have seen their wage promises deteriorate from “guarantee six (months of wages annually), try for eight 保六争八” to “ guarantee three, try for six 保三争六”. Similar wage arrears have affected workers ranging from SOE employees to doctors and teachers.

The policy tools for potential AI-driven displacement may no longer be viable in 2026 due to fiscal constraints by analyzing previous reforms that supported displaced coal workers. During 2016-2020, the central government committed ¥100 billion (approximately $14 billion) to support an estimated 1.3 million displaced coal workers through benefits and compensation. In the example of Wuhai 乌海, Inner Mongolia, the central government issued funds to SOEs to provide early-retirement benefits, severance packages, delayed salary payments, and other forms of support.

Local governments were expected to contribute similar sums and also took various measures to help the former coal workers find jobs. In Wuhai, the combined efforts from the central government, the city government, and the SOEs helped prevent social instability, and no petitions were reported. Local authorities also created non-coal-mining jobs by attracting new businesses, including in chemical supply chains like coke and chlor-alkali. As a result, employment in the chemical industry surpassed that in the coal-mining industry by 2020.

Compared to the Wuhai case, the government’s capacity to address AI-driven displacement today is far more constrained. With their coffers already depleted, local governments can provide few incentives to attract industries capable of bringing in new jobs, and in a world of AI disruption, it’s not totally clear what those industries would even be. (Sectors such as manufacturing, digital media, and AI development have reportedly seen the emergence of new job categories leveraging AI, but it’s an open question which positions could provide durable employment at scale.)

Therefore, many of the ambitious proposals for managing AI-led displacement may need to incorporate self-financing mechanisms rather than relying on direct government support. As deputy Lü Guoquan 吕国泉 has suggested, one potential approach would be requiring firms to reinvest a share of automation-driven cost savings into worker upskilling.

Public discourse further reflects concerns about unemployment and the administration’s capability to address it. When I spoke by phone with Wu Hong 吴宏, an advisor to the Neuroscience and Intelligent Media Institute at the Communication University of China 中国传媒大学脑科学与智能媒体研究院顾问, he told me he thinks that “macro-level pressures, rather than isolated technological advances, are stressing the economy and employment today”.

At the implementation level, online discussions expose how labor policies unfold in practice. On Zhihu, one user wrote:

“My company has to hire hundreds of new grads every year, but the business doesn’t need these people at all. Easy peasy — after a year, most either quit on their own or are laid off, and only a small fraction stay.”

Such anecdotal observations align with empirical findings. Research by a group of economists in 2023 found that government subsidies were linked with gains in employment at the time of subsidy receipt, but that these gains reversed one year later. In Ching Kwan Lee’s seminal work on Chinese labor politics, Against the Law: Labor Protests in China’s Rustbelt and Sunbelt, she argues that the violation of labor rights is a structural problem due to the national strategy of decentralized accumulation and legal authoritarianism: While local governments are responsible for developing a pro-business local political economy, the same local officials are also expected to implement labor laws issued by the central government, who sees stability as a legitimation strategy. Such tensions could weaken local government’s effort in managing AI-led job disruption since they are simultaneously incentivized to promote business efficiency.

Human-machine-coordinated Future?

AI-driven workforce disruption carries broader implications for China’s future. The pattern of displacement may differ from that in the West. In China, low-wage workers could be the most vulnerable as robots are already serving food in restaurants, delivering room service in hotels, and guiding shoppers in malls. The country’s 200 million gig workers also face mounting threats from robotaxis and delivery drones.

In contrast, in the US and other developed economies, anxiety about automation has largely centered on white-collar professionals. Major tech firms like Amazon, Microsoft, Salesforce, and IBM have dominated headlines with AI-related layoffs. Meanwhile, growing numbers of young people in the US and UK are opting for skilled trades over college, citing fears of AI replacing knowledge work. Wu Hong told me he thinks that China’s long-standing advantage of having a large pool of skilled manufacturing workers could be challenged if Western economies use AI and robotics to reshore production. He also suggests that with automation, the West may be able to replicate China’s advantage of having a robust talent base of highly skilled tech workers.

These possible trajectories add more complexity to China’s AI transition. Managing workforce adjustment is central to China’s social stability and national prosperity, and China’s proactive stance on the matter may allow it to build a concerted response system to cushion the impact of job loss. Expect stopgap measures such as new legislation and financial incentives to be introduced. Nevertheless, the harsh fiscal reality could stall many initiatives, forcing policymakers to confront difficult trade-offs between employment protection and AI-led efficiency gains.

What can we learn from its past glories and failures, and where should we take this next? We have of the Foundation for American Innovation to discuss:

• The Pendleton Act myth — Why civil service reform didn’t begin or end with Pendleton, and why starting the story there misses what actually made the system work.

• The rise of the subject-matter state — How early 20th-century agencies staffed with real experts — entomologists, engineers, agronomists — made the U.S. bureaucracy arguably the most capable in the world.

• From expertise to org charts — How mid-century functional reorganization hollowed out mission-driven agencies and replaced subject knowledge with process management.

• What competence delivered — From agricultural breakthroughs to infrastructure build-out, what a serious, technically grounded civil service was able to accomplish.

• Whether we can rebuild — DOGE, the abundance movement, state capacity, and why this might be the best time in decades to make the government work again.

Listen now on your favorite podcast app.

Why the Pendleton Act is Overrated

Jordan Schneider: Where do we start the clock? Everyone always wants to start with the Pendleton Act, but I hear you have a contrarian take on this.

Kevin Hawickhorst: The history of the U.S. civil service is defined by the people who were hired to do jobs for the government, whether they did well or poorly, and whether they had training. The civil service existed before the Pendleton Act and long after it. The real question is, how good were the people at different points in time? Did Congress think agencies were trustworthy?

We should start the clock at the major inflection points of the federal bureaucracy — where agencies became competent and managed to set up recruitment pipelines of civil servants who could actually do the job and command respect across the country. Questions like the Pendleton Act, merit exams, and removal protections are important, but they are secondary to the actual question of who was working for the federal government, and whether they knew what they were talking about.

Jordan Schneider: How did we go from being John Adams’s son or just a hack who got a job in the Postal Service to actually having real experts who knew what was up?

Kevin Hawickhorst: It’s a story in two acts. Under the Federalists and the Jeffersonians, we had a very “gentlemanly” conception of civil service — any well-brought-up person of quality could do basically any job. The Jacksonians expanded that to the idea that anyone who volunteered for the campaign could do any job. That was the low point.

By the middle of the 1800s, the country was completely awash in patronage. Tens of thousands of people were fired after each presidential election. At the height of the system, there were about 70,000 patronage positions in the Post Office alone. There were tens of thousands of hacks at the Post Office. We are talking about an unpromising foundation.

However, that was also an opportunity. The starting point was so bad that only truly excellent bureaucrats could overcome it and set up agencies and recruit the right people. In other countries, the civil service was a non-controversial, gentlemanly pursuit. In the U.S., only outstandingly well-run agencies could rise above the patronage morass, creating pressure to build excellence.

How did they do that? There were early experiments that didn’t take, but served as a playbook. The first worth looking at is the Topographical Corps in the U.S. Army. These were professional engineers and surveyors who mapped roads and bridges. It was an elite group that commanded respect from Congress, especially in the Western states where most of the surveys were done. The playbook was simple — recruit people from technical societies and put them at the disposal of Congress. It didn’t last due to the politics leading to the Civil War, but the idea remained and was foundational.

The real start of the upswing, where the civil service started clearly getting better, I’d peg it at about the 1870s or 1880s — right around the time of Pendleton, but starting a little before it. The first agency where professionalization was a really big story was the U.S. Public Health Service. Originally a loose federation of doctors who provided care for people in and around the military, it was revamped in the 1870s when the director decided to get serious. He restructured it as almost a paramilitary corps of surgeons — military-style uniforms, military ranks, recruited from medical schools around the country, and partnered with state hospitals.

Then, a lot of the bureaus of the Department of Agriculture were extremely good, professionalizing in the 1890s and the first decade of the 1900s. Agencies like the Bureau of Entomology, the Forest Service (around 1905), and the Bureau of Soils punched well above their weight in recruiting high-quality talent.

Jordan Schneider: The other professional thing we have from the start of the republic is the profession of arms. West Point goes back a pretty long time. To what extent was that a model for some of this much more domestic-focused, expertise-generating stuff?

Kevin Hawickhorst: 100% it’s the model. In most of the United States, people would work their civil service jobs for a couple of years at most and then get kicked out after the next election. But in the military, there were a few heads of bureaus who were almost all-powerful, serving for literal decades — 10 to 35 years. That would be unimaginable even today. In particular, the Quartermaster Bureau under General Meigs was outstandingly good. Provisioning the entire far-flung United States was a very difficult job, and they had to be excellent at it.

When you talk about military inspiration, the idea of professionalizing through uniforms, ranks, and standard training is part of it. But it’s actually the more civilian and logistical side of the military that was the bigger inspiration. The Quartermaster Bureau — people don’t talk about how outstandingly good it was, but it was world-class. It’s an underrated story.

Bug Scientists and Quartermasters

Jordan Schneider: Alright, let’s continue the narrative, Kevin.

Kevin Hawickhorst: I’ve set the stage for the late 1800s and said that these details about these agencies matter more than the Pendleton Act. Why do I think that? First, for your listeners — what was the Pendleton Act? In short, it was passed after President Garfield was assassinated by a man who thought Garfield had promised him a federal job. Reformers who wanted to get rid of patronage had basically the perfect story, and they muscled through Congress a bill saying you could only recruit people through merit tests — you had to test people and give the job to the most competent person. It was meant to get rid of patronage and graft.

Jordan Schneider: Wait, do we think Guiteau is a plant?

Kevin Hawickhorst: When I was doing my research, I was sworn to secrecy on this point.

Jordan Schneider: He was actually in favor of big meritocracy. It was the AI safety lobby of the late 1800s.

Kevin Hawickhorst: Guiteau’s secret double life aside — he was the one who shot Garfield, of course.

Jordan Schneider: Now a Netflix star.

Kevin Hawickhorst: My real goal is to get General Meigs at the Quartermaster Bureau a Netflix show. Or the leaders of the U.S. Public Health Service.

People say the Pendleton Act is when we decided to get rid of politics and recruit real experts. Here’s the thing — first, it was just a law, and it was not implemented very quickly. It applied to only a very small number of positions for decades. More than that, it was still just a law. The civil service is a bunch of people who work for the government and do stuff, and laws only matter if they make you recruit different people who do different stuff. The fundamental question is when did the government start recruiting better people who started doing better stuff? The Pendleton Act helped change the trajectory — it’s a major factor — but it is not directly the answer to that question. One has to look at different agencies and ask when they started recruiting much better people and how they managed to do it. The history of civil service law is not the history of the civil service.

Having made my anti-Pendleton screed, we reach these bureaus I love so much — the U.S. Public Health Service, the Bureau of Entomology, the Bureau of Soils, the Forest Service, and all the rest. Why were they good? My theory from reading all of this history is that agencies were organized differently and had a different relationship to Congress and civil society than we have today.

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This struck me when I was reading about the Department of Agriculture and thinking about the different agencies — Bureau of Entomology, Bureau of Plant Industry, Bureau of Animal Industry, and Bureau of Soils. These are such charmingly old-fashioned names. The concrete, old-fashioned names reflected something real about what they did and the vision they embodied about what government is and does.

Take my favorite example — the Bureau of Entomology at USDA. It brought together all the different facets of entomology. Employees would do research, usually working with state land-grant colleges. They would regulate diseased crops, usually working with state regulators. And they would administer grant programs to help farmers insect-proof their crops. They combined every function of government, all related to a single subject, and were then able to draw on technical vocations.

If the government were making a pitch to entomologists, they’d say, sure, the private sector can pay you more, but this is going to be literally the most interesting job in the world for an entomologist. You’re going to see every corner of it in your career — from research to enforcement to helping people on the ground. That was a very attractive proposition for technical people.

When the agency was filled to the brim with people with a slightly autistic fixation on their subjects, it commanded real respect because it clearly had expertise that most people just didn’t have. If you’re a Bureau of Entomology filled with hard-charging experts going around putting a stop to outbreaks of weevils, that’s clearly impressive. During the patronage era, people would look at jobs in the post office and say, “I could do that.” They’d look at jobs in the Treasury Department processing paperwork and say, “I could do that.” But then you look at a Bureau of Entomology filled with uniformed entomologists with PhDs — in an era when nobody had PhDs — going around ending outbreaks of infestations, and people would not say, “I could do that.” They would say, “I’m glad that there are people who can do that.” That’s basically the attitude that lets some agencies rise above the morass of patronage in the late 1800s.

Jordan Schneider: How far did we get with this trend? Give us some of the highlights of the accomplishments this setup ended up unlocking.

Kevin Hawickhorst: They recruited people with the strength of their pitch, and then for the actual doing, they paired heavily with state regulators, state universities, and similar institutions to make themselves known throughout the entire country and build up congressional support. It wasn’t just “they could do the thing” — it was “they can do the thing, and everyone knows they can do the thing because they are doing the thing throughout the U.S.”

The Progressive Era playbook of these technical agencies was first to organize around a single subject that corresponds to some vocational community — engineers, doctors, whatever. Second, offer this technical resourcing to institutions throughout the country — state universities, state regulators, ordinary people through grant aid — to make it known that you have this expertise and are putting it at their disposal. Get the right people in and then get them out to show them to the world.

What Competence Delivered

Jordan Schneider: We have all these really smart specialists doing research and counting up insects and whatnot. What does that end up unlocking for the American people — economic development, governance that didn’t exist when you were stuck with hacks getting their Postal Service gig?

Kevin Hawickhorst: Just at the level of vibes, people don’t appreciate how good it was. At the USDA in 1910, if you look at the top appointees who ran the agencies — formally political appointees, even though the president normally appointed career experts — two-thirds of them had graduate degrees in their subject. That would be almost unimaginable today, and it was astounding back then when basically nobody had a graduate degree.

The agencies had very good leadership, and outcomes were much better than is customarily remembered. European bureaucrats went on trips to visit the USDA headquarters in the 1900s and 1910s because they considered it possibly the best-run bureaucracy on the planet. It really did manage to do some big things.

The growth of productivity for American farmers was not quite the laissez-faire rugged individualism we remember. The USDA spent lavishly on research, and there was enormous outreach to bring information to U.S. farmers and boost productivity. It was a significant factor in helping the agrarian sector, which was the great majority of the United States, well into the 1900s.

A lot of the infrastructure connecting the United States was also laid during that era — not physical infrastructure, but the basic setups. The U.S. Bureau of Public Roads started the earliest programs of federal supervision of road building and was extremely elite. The head of it in the early 1900s had studied at the French École des Ponts et Chaussées, one of the most prestigious civil engineering schools in the world. It set technical standards, and much of the planning about road layout eventually evolved through the New Deal and ultimately into the Interstate Highway System. People remember the actual building of the Interstate Highway System, but the Bureau of Public Roads started raising standards for state and local roads, writing plans, and getting politicians aligned on plans that bore fruit much later. Their vision had great staying power — it was very path-dependent.

Then there was a fundamental boost to the U.S. economy through the Postal Service. Toward the end of the 1800s, there was a backlash against the fact that the post office was incredibly expensive and worked poorly. The Post Office tried to professionalize, and as it did, it said, we’ve become much more competent, we’ve got our costs under control, we’re hiring professional people and kicking out the corrupt ones. We want to do more. They proposed setting up a delivery network for parcels and magazines throughout the entire United States — before that, the post office basically just handled letters.

They convinced Congress, rolled it out nationwide, and it was transformative, especially for rural areas. You’ve probably heard stories about people in rural communities reading their Sears and Roebuck catalog deciding what to buy. It was once transformative that you could even do that. Where did the delivery service come from? How did Sears and Roebuck send you the stuff you ordered, or even the catalog? The post office set up a highly subsidized delivery network for magazines and parcels, which enabled big manufacturers to sell throughout the entire United States. You got a mass market for goods on one hand, the rural areas connected to the modern economy on the other, and the post office was at the center of it.

It also broke up the personalistic power relations in certain rural communities, where the person who owned the general store was the king of the castle — everyone had to buy goods from him. Now you could buy from anyone who would deliver to you. You could just get their catalog and order it.

The actual stakes of civil service were much higher than just whether we had too many people getting fired. It was about whether we were building the infrastructure of the United States, bringing modernity to rural areas through delivery networks, agricultural research, and more. The accomplishments are foundational, and they’re forgotten because people over-index on asking what the laws were like instead of asking what the bureaucracy was like—what they were doing and whether they were good at it.

The Lost Literature of Public Administration

Jordan Schneider: Let’s take a detour to talk about the literature around these questions. A year or two ago, I tweeted asking who’s got good books on the history of federal bureaucracy, and you responded with a book from 1957 — a good book, but also kind of the only book. There’s one Italian professor who has written a contemporary thing about the history of the primarily post-World War II American civil service. But Kevin, you’ve put together an annotated bibliography about this. Give the audience a sense of the scholarship that’s out there for you to be able to make these claims.

Kevin Hawickhorst: First, a horror story for your listeners — a book from 1957 is one of the more comparatively recent books on my bibliography. Many of them are from the 1920s and ’30s.

For why that’s the case, it’s useful to ask, how did I get interested in this, and how did I find these books? I got interested in grad school while studying economics and wanting to know more about the politics and implementation of programs. I had this question — was the government more competent in the past? Lots of people have asked that, but I got frustrated at the level of generality the debate often stayed at. To exaggerate, people would say, “Well, in the past we hired real experts and gave them real authority but had real accountability,” or some similarly meaningless thing. That’s just a platitude.

There’s a prima facie case — we won World War II, built the Interstate Highway System, and put a man on the moon, and now we don’t do much of any of those things. Given that we pulled this off, there must have been concrete nuts-and-bolts things we did differently. I wanted to know how we wrote job descriptions for the Tennessee Valley Authority’s engineers. How did they hire them? How did they do budgetary oversight for New Deal infrastructure? How did they train managers for the Interstate Highway System program?

There’s just very little written about this. There’s a lot of discussion of high politics, but it treats the stopping point as a law being passed or a consensus brought about. The real question is what bureaucracies were doing — how they budgeted, hired, and trained people. At the end of the day, the civil service is a bunch of people who work for the government and do stuff. The question of public administration is — who were those people, and how did they do what they did?

It turned out, first, that there’s almost nothing written about this. But second, it’s not actually that difficult to find out. Most of this stuff is public domain government office manuals that have been digitized on Google Books. You could look up the answers without getting up from your desk.

A whole lot of my sources are just primary sources — agencies explaining what worked well and why and how they did it. I find that vastly more interesting and actionable than the secondary literature, which is often quite vague and sands away almost all the technical details of how agencies budgeted for projects, classified jobs, and so on. Primary sources are way better because they’re the words of the bureaucracy talking about itself — how it thought, what people thought they were doing and why. You don’t get that except by reading primary sources.

Then you get to the old-fashioned books about civil service history, written probably from the 1920s to the early 1960s. Why do I recommend those rather than more modern books? Here’s an anecdote — in my early days studying public administration, I saw a monograph about the Canadian budget system written around 1915. I have a friend who worked for the Budget Office of Canada, so I sent it to him and asked if it was accurate. He said he’d read it for a laugh — Americans writing about the Canadian budget system more than 100 years ago, he’d be surprised if they got one thing right. A month or two later, he texted me, “Not only was it good, but it’s probably better than anything that’s been written since then, and it answered several questions I’ve always had at the back of my mind about why my job worked the way that it does.”

These old-fashioned books have something to be said for them. The culture of academic work was very different. To briefly lapse into the register of one of those annoying Roman statue accounts on Twitter — we were a serious country back then. Research was focused on collecting the raw mass of facts, taxonomizing it, and saying “here is everything there is to know about the subject,” with not much big-picture interpretation but utterly comprehensive in its collection of facts. Today, that isn’t the fashion for academic or think-tank policy research. There’s much more focus on having the right big-picture idea, a vision, an interesting narrative. But in the past, studies were content to collect everything known about the subject, organize it logically, and say, “Here’s how it looks, but we’re telling you everything we know — come up with your own conclusions.”

The good thing is you can come up with your own conclusions, and these books teach you things you’d never have thought to ask about — the fairly bizarre experiments tried at different times, which sometimes worked brilliantly, sometimes were astounding failures, sometimes you’re surprised anyone even attempted. Policy was like stamp-collecting for the people who wrote these books. They wanted to collect all of it and arrange it carefully, and they believed you’d be just as fascinated by the different ways to do budgeting as they were.

Paradise Lost — Functional Reorganization

Jordan Schneider: Let’s come back to our timeline. How does it all fall apart, Kevin?

Kevin Hawickhorst: I’ve given you paradise, and now it’s time for Paradise Lost. Let’s recap the scene in the 1910s and 1920s. We’ve got entomologists spending their entire day thinking about ants. We’ve got civil engineers who look at roads more often than they look at human faces. We’ve got all of these people in the bureaucracy, and then in civil society, researchers spending their days writing 400-page books comparing the U.S. budgetary system to the Canadian and British ones. A beautiful time to be a bureaucrat. What happened?

I mentioned earlier that the agency names for the Department of Agriculture were old-fashioned — Bureau of Entomology, Bureau of Plant Industry, Bureau of Soils, and Forest Service. They sound old-fashioned because we don’t have agencies like that anymore. Why?

From about the 1930s to the 1950s, there was a movement called functional reorganization. The viewpoint was that the government was organized in an unscientific way — just a random collection of entomologists and soil scientists and whatever, a grab bag of vocations that had managed to plant their flagpole in the federal government. Reformers said what we really need is a very clean, tidy org chart that can expand or contract to do anything the government wants to do. Specifically, they said the government should be reorganized to separate by function rather than subject matter.

In practice, here’s what that meant — I’ll use the Department of Agriculture. The Bureau of Entomology researched insects, regulated insects, and ran grant programs about insect-proofing crops. The Bureau of Soils researched soil, ran grant programs to help farmers prevent erosion, and regulated things that cause erosion. And so on.

Functional reorganization grabbed each function from the different agencies. They created a Bureau of Agricultural Research and pulled in the soil research, insect research, and all other types. Then, a Bureau of Grant Programs pulling all the grant work from each subject bureau. Finally, a Bureau of Agricultural Regulation pulling all the regulatory work. Now there was nothing left in the Bureau of Entomology or the Bureau of Soils — they were reorganized out of existence.

The new org chart was organized around functions — all research here, all grant programs there, all regulation over there. It was no longer organized around topics like entomology, soil or roads. That’s why the names of the old bureaus sound old-fashioned. They’re very concrete. Today, we have pretty vague names about functions rather than things you can look at and touch.

Jordan Schneider: And why is this the worst thing to happen since the invention of the forward pass?

Kevin Hawickhorst: What made these agencies so good in the first place? It was the fact that they said, we have a really unified mission that ought to be appealing to any technical person. If you want to do entomology, at the Bureau of Entomology you’re going to do grants about bugs, research about bugs, and regulate the bugs. If you’re just wild about bugs, this is the place to be. And entomologists loved it. They went bananas.

What happens when you completely undo that and organize according to the opposite principle? First, you no longer have that pitch. You’re a really good entomologist considering Monsanto versus the Department of Agriculture. Agriculture says, would you like to work in the Bureau of Agricultural Regulation? Maybe. The Bureau of Agricultural Research, where you’ll be one of many priorities? Maybe. Doing aid and processing paperwork? Probably not. And then Monsanto says, would you like us to pay you 10 times more and fly you around to industry conferences? Sold to the highest bidder. The government just didn’t have a pitch to recruit technical people because it didn’t really have a place to put them anymore.

On top of that, the new agencies had much more pathological cultures. In the old subject-matter system, the Bureau of Entomology had a balanced mission — they gave aid to farmers, but that was never all they cared about, because they wanted to get back to research. They regulated farmers, but that wasn’t all they cared about either. No one element was dominant.

Under the functional system, there was much more of a monoculture. If you’re the Bureau of Regulation, there’s a lot more incentive to be harsher to the entities you regulate, because you don’t work with them and see the consequences. If you’re the bureau of just research, it rapidly became very academic and not very applied, because they weren’t working with real people, with farmers and state regulators. Then, probably the worst behavior was in bureaus devoted to grant programs. If you’re an agency that distributes grants, the only way to get more prestige, funding, and personnel is to open up the spigots further. Agencies devoted to grant writing are completely identified with their interest groups, which decreased the autonomy agencies had and the independent technical judgment they used to embody.

The functional reorganization from about the 1940s and 1950s — that is my original sin. That’s what takes us from paradise to paradise lost.

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Becoming a Serious Country Again

Jordan Schneider: What’s the path back, Kevin?

Kevin Hawickhorst: The first implicit premise is, is there a path back? It would be nice, since that’s ostensibly what I talk about for my day job. It would be a problem for me if the answer were “no, we’re screwed.”

Luckily, there is a path, at least, to point us more in the right direction. Today, you see a lot more interest in rethinking the ossified and outdated bureaucratic processes we used to just put up with. Dysfunctional processes around permitting, federal hiring — the opposite of a technical viewpoint focused on achieving actual results. For a long time, there was learned helplessness. People in the policy world would say that maybe things could be 5% more one way or the other, but they could never be all that different.

Today, we live in the era of Trump round two and DOGE, and whatever else can be said, it cannot be said that they are limited to making things 5% one way or the other. There has been a real expansion of people’s conception of what is possible. I’ve even heard this from Democrat friends, who’ve said things along the lines of — what fools we were in the Biden administration to care so much about doing things the way they’ve always been done. When the Trump administration is just going out and doing stuff, they say, we should have too — we’re going to care about the law a lot more, but we won’t care about anything else besides that.

The Trump round two experience of shaking things up has changed the conception of what’s possible, what can be done. You could make a good case that the results will be a lot worse than we thought possible. You could make a good case that they’ll be a lot better. But the range of outcomes is much wider.

There’s also a lot going on that doesn’t make the news as much but is shaking things up in a probably more lasting way. For example, the administration is revamping federal hiring. It used to be the case that federal resumes were 10 to 15 pages long — absolutely insane by any private-sector standard. People have talked about improving this for years or decades. The administration hit on a simple solution. They changed USAJobs so it rejects anything more than two pages long.

There’s excitement in civil society about the idea of just trying to be more competent, making things run better, and caring if they do. The abundance movement is all the rage — people saying we have to promise our firstborn child for debt peonage to buy a house, and wouldn’t it be nicer if that weren’t the case? They’ve organized to make it easier to build houses and roads and have a better, more abundant future. That’s a very American thing — the belief that you really can make things better if you get together and argue and fight hard enough to change the rules of the game.

There’s a lot of excitement around what people call state capacity. The government should be able to do stuff. It can’t, but it should. Why can’t it? Because it can’t hire people, it can’t update its IT systems. But there’s excitement about diving into these gory details and trying to fix things. At the Foundation for American Innovation, I’m constantly struck by the fact that this is actually a great time to be in policy. There are other think tanks — the Institute for Progress, the Niskanen Center — hiring younger, harder-charging people who want to argue that things could be much better, not just 5% better or worse. There’s a lot of movement in philanthropy, too — the Recoding America Fund raised about $100 million to improve IT and hiring processes.

The path back requires a foundation. Things have been shaken up politically, culturally, socially, and institutionally. People realize things have to change and they’re putting resources toward it. I said earlier, somewhat jokingly, that we were a serious society back then. I see evidence that we’re at least interested in becoming a serious society again. That’s one step removed from bringing the bug scientists back to the government. But it’s the foundation for any big change.

Jordan Schneider: Anything else we should close on, Kevin?

Kevin Hawickhorst: The biggest thing would be to make a pitch. I enjoy ranting about the history of bureaucracy, but it would be nice to go from “I talk about bureaucracy” to “we become a serious country again.” If there’s anyone out there who thinks it does sound cool to read 400 pages about the budgetary system of the United Kingdom in 1910 and talk about what that means for IT procurement today, please get in touch. Message me on LinkedIn, Substack, wherever. There are just a few enough people who care about making things work well, and I’m hoping that some of your listeners do. In any event, it’s been a real pleasure to talk about this.

Jordan Schneider: For what it’s worth, I’ve really been enjoying Kevin’s scholarship and activism around this stuff. His writing and deep dives into this space are fascinating. The world needs more young, hungry historians and policy entrepreneurs trying to make the civil service a more exciting and vibrant place. Hats off to you, Kevin. Do reach out if you thought this stuff was cool. Keep digging.

Kevin Hawickhorst: We need more entomology stories from the 1910s. There will be more bugs to come.

Jen Pahlka, author of Recoding America and founder of the Recoding America Fund joins ChinaTalk to discuss:

• Why AI could help governments cut through regulatory cruft, but can’t replace the political will needed to reform it,

• How state-level competition and experimentation could accelerate government reform,

• Why even obvious bureaucratic fixes are difficult — nearly every dysfunctional policy has a constituency that benefits from it,

• The Recoding America Fund’s mission to build a cross-ideological coalition to modernize the government’s operating model.

Plus, we talk about 7,119 pages of New Jersey unemployment insurance regulations, why drastically cutting the defense budget might improve national security, and why the toughest questions about public programs aren’t technical, but fundamentally political.

Listen now on your favorite podcast app.

What AI Can and Can’t Fix in Government

Jordan Schneider: Jen Pahlka, American hero. Welcome to ChinaTalk.

Jen Pahlka: It’s really an honor to be here, though you’re overstating things already.

Jordan Schneider: Where should we begin? I want to talk about the Recoding America Fund and the bright future you envision for American governance. If this all goes great, what can we expect our federal, state, and local governments to accomplish?

Jen Pahlka: That’s a good question. We tend to go straight to the negative, and there’s plenty of negative to talk about — but people are driven more by wanting to get to a good place than away from a bad one. Government is supposed to meet people’s needs, both individual and societal, and we’re really struggling to do that right now. We’re stuck trying to get 10% better here or 15% better there, instead of asking — what do we actually need to leapfrog to? Whether it’s administering a social safety net that protects people in vulnerable times or deterring adversaries, we need to start thinking in terms of actually meeting the moment rather than moving slightly ahead from where we are today.

When I started in government reform in the late 2000s and early 2010s, the basic argument was that if you want to meet people’s needs, you have to recognize that their expectations have changed. They expect to be able to do business online. If there’s a real gap between how people get things done in their private lives and the burden we impose on them when dealing with government, that is not good for democracy. If we can close that gap — which AI has now blown wide open — people will support a government that works, and they will care about institutions that work for them.

Jordan Schneider: We’re running this in parallel with an episode featuring Kevin Hawickhorst from FAI on the history of the civil service. There’s this idea that we had a golden age in the early-to-mid 20th century, after Progressive Era reforms kicked in, with truly excellent organizations and people. On one hand you have that degradation, but on the other, the expectations of what government should do have also increased as private-sector service delivery has dramatically improved over the past 50 years. Do you want to apportion blame between those two factors? Is there anything else going on?

Jen Pahlka: What you had was a very effective administrative state — the glory days Kevin talks so eloquently about — that was fit for purpose for that moment. Part of why it was fit for purpose is that it built in its own sense of renewal. Kevin talks about a practice under the Eisenhower administration of constantly renewing and streamlining business processes — it was called “work simplification.” You read that and think, that is exactly what we need now. It doesn’t require much translation to the current era.

What we lost was that notion of constantly re-examining things. We got lazy and let policy and process accumulate like layers of cruft — archaeological layers you can dig back through. Our legislators and policymakers came to believe that success means adding rules, mandates, and constraints, instead of constantly asking — what should this process look like? What do we need to remove to make it effective? It is, in some sense, a return to past practices, but those past practices were good precisely because they weren’t frozen in time.

Jordan Schneider: You blurbed a paper by Luukas Ilves called The Agentic State. It analyzes transformation through 12 functional layers. The six implementation layers where agents can deliver immediate value include — “public service design that becomes proactive and personalized; workflows that self-orchestrate; policymaking that adapts continuously based on evidence; regulatory compliance that operates in real time; crisis response that coordinates at machine speed; and procurement systems that negotiate autonomously within policy constraints.” That seems pretty compelling.

Jen Pahlka: Luukas said it very well. And the next piece covers six enablement layers that go with that — complicated, but important.

Jordan Schneider: I want to stay on this question of the path forward. We have 75 years of accumulated cruft, Nader-era pushback, and deliberate erosion of state capacity.

Jen Pahlka: We have undone state capacity. I would agree with that. But we’ve undone it by doing too much in a certain way. It’s primarily the laziness of not cleaning up our messes rather than the intentional undoing of anything. In some ways, the intentional undoing of what has been done would create more state capacity.

Jordan Schneider: The human man-hours that would take to undo this…You recently did a show with Greg Allen where you talked about the 7,000 pages New Jersey unemployment insurance has to operate under.

Jen Pahlka: 7,119 pages of active UI regulations.

Jordan Schneider: Unwinding that would take tens of thousands of man-hours to map and rationalize — or you just have an AI get 95% of the way there. It seems like the only way out.

Jen Pahlka: The good news is that the moment we arrive at the realization that 7,119 pages creates an unadministrable program — and I think we’re starting to get there — the tools have arrived to make that problem a lot easier. That brittleness is especially dangerous for a program that operates at low volumes day-to-day but needs to scale 10x or 20x in claims during a crisis. Scalability is a core requirement.

The pushback I get is that AI can’t be in the driver’s seat. But people can be in the driver’s seat if they choose to use these tools. The AI cannot do anything about the political will required to unwind the memos, guidance, policy, regulations, and statutes that need to be unwound. But we haven’t really tested that political will, because nobody has been able to articulate what the target should look like. How many pages should it take to describe a program that gives someone money for a certain number of weeks under certain circumstances? It’s certainly not 20 pages, but it needs to be a lot less than 7,000. Until we put forward what we think that should look like, we haven’t tested the will of our political leaders to get us there.

Jordan Schneider: Two things could block this future — politics and fear of AI. I’m relatively optimistic on the fear side. I remember people being terrified of Uber and Airbnb. The daily utility people are getting from these tools is only going to grow — everyone is going to have a personal assistant, and maybe part of the answer is that people just outsource their government interactions to their AI agent, which cushions some of the pain, though that doesn’t answer whether the unemployment check is actually coming. Still, I think demand for these tools will grow from politicians, government workers, and the public alike. Are people going to get over their fear?

Jen Pahlka: People will. The question is whether we will have already put too many rules in place — such that the cultural barriers dissolve, but the statutory and regulatory barriers were locked in before we really understood what was possible.

When the Biden AI executive order came out and OMB was developing its guidance, Dan Ho and I submitted a letter that restated a paper I wrote called “AI Meets the Cascade of Rigidity.” The concept is that while people can create guardrails that sound perfectly reasonable on paper, in a risk-averse, overburdened bureaucracy, those guardrails don’t function as guardrails. They function as barriers you simply cannot overcome.

The unemployment regulation example is actually a useful corrective to AI fear, because it illustrates what AI genuinely can and cannot do. It can rewrite the law, but it cannot get that law passed. It can rewrite policy, but it cannot get that policy enacted. Humans have to do that. If you want an example where there’s no fear that AI will take over — because it structurally can’t — that’s it. You realize at the end of the day that it is a tool in the hands of people trying to make government better, and that the binding constraint isn’t the AI. It’s our political system.

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Jordan Schneider: What didn’t exist in 2024, or even for most of 2025, is the idea that software is basically free — or that software engineering productivity is now 10x or 100x, and people who never imagined themselves writing code can now build tools.

Jen Pahlka: It’s extraordinary — and yet basically the entire federal government and most state governments are not adapting to it. They still have contracts with vendors that have people writing code. Those people may or may not be using AI coding tools, partly because policy clarification hasn’t come down. But even setting that aside, those contracts don’t account for the dramatic drop in the cost of software development. It’s going to be decades before government actually pays less for software — and right now we’re probably going to start paying more.

We should be running a five-alarm fire. How does government get the software it needs dramatically faster and cheaper? That’s not entirely what’s happening yet — and I don’t say that to dismiss the great leaders I meet who are pushing hard on this. But they are held back not just by AI guidance, but by procurement systems, contracting rules, legal reviews, and the legacy ways of doing things that, in the Recoding America framework, sit at the very bottom of the Maslow’s hierarchy of government needs. These foundational processes don’t look like they have anything to do with AI on a day-to-day basis — but they fundamentally either enable or constrain government’s ability to enter an AI era. And at the very bottom of that pyramid, everything rests on one question — do we have a functioning workforce? Is our civil service fit for purpose for this era?

Recoding America for the AI Era

Jordan Schneider: Give us a 30-second introduction to Recoding America.

Jen Pahlka: Here’s a little backstory. My book Recoding America came out in 2023, and as I went around talking about it, people kept saying that I was describing the dysfunction of government and how critical it is to fix it, yet there’s no political power or momentum behind the recommendations — they’re ideas without a constituency. It was Kumar Garg at Renaissance Philanthropy who said the way to put teeth on this agenda is to raise funds and act as a field catalyst for government reform. Not the flavor of reform we’ve had over the past couple of decades, but reform that leapfrogs government into an AI era. Whatever you care about — deterring adversaries, the abundance agenda, a functioning social safety net —

Jordan Schneider: Or small government.

Jen Pahlka: Small government cuts across all of it. But whether your issue is education, housing, transportation, or criminal justice, what you realize is that you can bring in better policy and still not get the intended impact. That’s because, just as Maslow’s hierarchy says you can’t achieve self-actualization if you’re not fed and housed, you can’t iterate meaningfully on policy when the basics aren’t covered. The basics are the operating model of government — and ours is an industrial-era model that was excellent for its time. We slapped websites on the front end of it when the internet arrived without fundamentally adapting it, and now we’re entering the AI era needing to leapfrog it entirely.

The thesis of the Recoding America Fund is that if you want government to achieve its policy goals, it needs to hire, manage, and retain the right people — which means civil service reform. Those people need to be focused on the right work — which means procedural reform and cutting the policy cruft we discussed. They need purpose-fit systems, including but not limited to AI. And they need to operate in test-and-learn frameworks rather than the waterfall methodology that infuses everything government does. We’re trying to catalyze a field of civil society organizations that push and enable government to make that leap.

Jordan Schneider: On the vision — you walk through many policy areas where people have strong feelings and don’t always agree. How close are we to the Pareto frontier of effectiveness before we start hitting genuinely ideological tradeoffs? Can we keep the middle 75% of the political spectrum aligned on this agenda?

Jen Pahlka: Let me qualify first by noting that we naturally focus on the federal government, but we also work with states — and updating an operating model is largely independent of whether you’re talking about education or national defense. States are valuable because you have more opportunities to find where the energy is, prove it works, and let other states and cities adopt it. The federal government can learn from that too. The classic line applies — the future is here, it’s just unevenly distributed.

One area where people will have very strong feelings is civil service reform, which hasn’t meaningfully happened since 1947. The Civil Service Reform Act of 1978 tinkered around the edges more than pulled us into the paradigm we need. Civil service reform is going to be hard, especially given legitimate concerns about protecting civil servants’ independence. We have to be careful that in the interest of building a properly manageable workforce, we don’t create massive turnover with every change in administration and a culture of fear. That would be a very bad outcome.

That said, there are already real opportunities at the state level. North Carolina’s legislature looked at their system, declared it unfit for purpose, and asked the state HR director to propose a complete reboot — a major, major reform. We’ve been fortunate to support that with fellows helping push their thinking. That’s the dream — working on a real civil service system. Since we believe in test-and-learn frameworks, it’s great to do this with North Carolina while we look for opportunities to replicate it elsewhere. You need to start building the muscle and riding the bike around the block while you wait for the larger policy windows to open.

Jordan Schneider: That felt like a dodge — let me try again. Take our 7,000 pages of unemployment insurance regulation. Let’s say 75% of it is just dumb and silly. Then you start hitting real tradeoffs. Do we prioritize people with children? Do claimants have to prove they’re looking for work? And we recently saw a reconciliation bill where the projected Medicaid savings were predicated on new regulatory cruft intentionally designed to create friction so people don’t access benefits. Is your sense that we can go really far or 50% of the way to our beautiful functioning future? Like at what point does this agenda hit the wall of principled disagreement that only legislators and elections can resolve?

Jen Pahlka: I won’t give you a percentage because I genuinely don’t know, but you want to distinguish between things like Medicaid work requirements — which are deliberately designed to make the system operate poorly — and things that are just capture by the status quo that accidentally make things worse without intending to.

Even in that second, less politicized category, change is still hard, because there are always people whose business model is built around the dysfunction. One of my learning arcs over the past 15 years has been moving away from the belief that you can wash all of that away as soon as you demonstrate how dumb it is. There are constituencies for every dumb thing, even when it’s not as cynical as intentionally rationing Medicaid dollars through friction — which is just a terrible way to allocate scarce resources.

The deeper conclusion I’ve reached is that in a better world, instead of legislating down to an incredible degree of procedural specificity, you tell agencies here’s the goal, and give them far more freedom to get there. That’s what we call outcomes-driven legislation — the PopFox Foundation has a great outline of what that looks like. We could move much further in that direction and still not be at the ideal.

The real problem is that we often have outcomes-driven legislation’s opposite precisely because legislators don’t actually agree on the outcome. They can agree on the rules of the system, and then you’re locked into administering those rules. One person thinks the point of a program is to make sure people don’t end up in the emergency room and another thinks it’s to keep costs down. They’re not necessarily mutually exclusive, but what they’ve agreed on is the rules, not actually the goal. That is going to be a significant obstacle to where we want to go.

The positive future is one where we are much clearer on goals and have the agency tools to tack toward them, rather than just executing steps A through B through C in a waterfall. On the role of politics — yes, ultimately, voters will have to reject things like Medicaid work requirements. The problem is that right now, we don’t have a responsive feedback cycle. Implementation takes so long that voters are always reacting to something two administrations ago — there’s no perceived correlation between a harmful policy and electoral consequences.

We need to speed up implementation so that when you do something good or bad, you actually feel the consequences in the next election.

Jordan Schneider: So you won’t give the number. But I think it’s about 80% you can fix before you hit genuinely hard ideological trade-offs.

Jen Pahlka: I love that number, and you may be right about the percentage of stuff that’s more trivial. But we still have to face the capture embedded even in that 80% — it’s much less, but it’s there. We still have to get people into a trade-off mindset.

Jordan Schneider: So — how to make legislators’ jobs more fun. We have our 7,000 pages. Let’s say 6,000 of them are just dumb requirements everyone agrees can be AI’d away — fax mandates, wet signature requirements, that kind of thing. What excites me is the idea of teeing up the actual decisions — here are the 10 questions where, if you give me answers, I can reach the next Pareto-optimal policy improvement. The AI figures out all the mechanical stuff. It’s not up to the AI to decide whether single mothers should get more than two-parent households or how to structure alimony. But once you get into that territory, the political valence of the AI doing the teeing-up gets really tricky.

Jen Pahlka: Do you mean teeing up the policy decision, or making a benefit determination?

Jordan Schneider: I mean the model not just doing the boring stuff, but facilitating the discussion, doing the modeling, and ultimately generating recommendations on the hard normative questions. We have the CBO, which is the closest thing to objective scoring we have — imperfect, but both sides interact with it as a form of shared truth. I can imagine a version of the CBO where an AI does that for an enormous swath of tradeoffs and decisions, with models rather than beleaguered congressional staffers providing the simulations, ground truth, data, and projections. It could be a really strange future.

Jen Pahlka: It will be strange. By the way, I love the framing of “let’s make the legislators’ jobs more exciting.” I’m going to use it and pitch that.

But one thing that excites me is that it gives you the ability to actually interrogate goals. You can ask much more easily now — will this policy intervention, properly implemented, help more people return to work? In the unemployment insurance context — if one goal of UI is to prevent people from falling into deeper poverty so they can get re-employed — that whole world is changing dramatically right now. We need to be asking, is that one of the goals? And if so, does the way we verify the terms of someone’s separation from their last job actually advance that goal? Enormous amounts of administrative burden go into that question, and it might not make much difference to what the program is actually trying to achieve. Not as damaging as Medicaid work requirements, but still significant. We need to ask, what is the right design of this program if what we actually want is to prevent chronic unemployment?

Jordan Schneider: Coming back to my idea that people will embrace these tools — maybe this is part of the amazing future — but the experience you have with Claude Code where it keeps asking for permissions and you just say “sure, just do it,” within three to five years, the things models will strictly dominate humans on — especially a lot of government work, which is just taking rules and applying them — we’re going to be handing a lot over to technology. Government will be slower, but in many corners of life, you’ll be delegating to your model. And we still have elections and legislators.

Constraints, Competition, and Crises

Jen Pahlka: But that’s exactly it — when the moment comes where it is just patently obvious that handing that over is the right thing to do, will we have already constrained ourselves? We’re sitting in New York, which has passed a law saying you cannot change a public servant’s job because of AI. I understand the logic. But it could fundamentally exacerbate the gap between public and private sector effectiveness in ways that are devastating.

Jordan Schneider: Those dumb constraints will go the way of the dodo when Pennsylvania and New Jersey don’t adopt them and end up literally ten times more effective. Though it took phonics a very long time to get out into the world, so who knows?

Jen Pahlka: No, that’s actually true — something that was very clearly the right answer took a minute.

Jordan Schneider: At least at the state level, you have that competitive dynamic. I’m thinking ahead to 2030, when everyone’s gotten it, and we’ve already moved past most of the ideological debates because AI has gotten us 95% of the way there. That’s the future we’re working toward. Are people genuinely freaked out about this?

Jen Pahlka: That’s one of the reasons having 50 states is great. New York might pass a law, that I think is a terrible mistake, but they’ll hopefully be forced to revisit it when their neighbors are kicking their ass.

Jordan Schneider: That competitive dynamic will drive proliferation in the private sector. The New York–New Jersey–Connecticut–Pennsylvania feedback loop is slow but real. For the federal government, we have elections every two years — is that what unlocks AI-era government services? We had a version of that with DOGE, though I’m not sure if that’s the future. Then there’s the defense establishment, which confronts this daily in the intelligence community, and we seem to be in a conflict every month now. Where do you put different institutions on the spectrum from “constant competitive pressure to modernize” to “the IRS”?

Jen Pahlka: It’s interesting. The fact that we’re in a near-constant state of conflict ought to kick us into crisis mode, and our history is that we act in crisis. The transformation into the digital era has really only come in leaps. Healthcare.gov is the perfect example — I was in the White House at the time, trying to stand up what became US Digital Service (USDS), and it was moving very, very slowly. Truthfully, I don’t think it would have happened without the crisis of the healthcare.gov launch.

Being in a hot war with Iran might change things at the Pentagon. But one core problem is that we just keep giving the defense establishment more money. Constraints drive creativity — they’re part of transformation. I was sitting next to a very senior Air Force leader at an event once and said that after my four years on the Defense Innovation Board, my conclusion was that you could only defend the country better by cutting the budget, because the bigger these projects get, the more rules accumulate, the slower everything moves, and the more people are touching it. I half-apologized because I felt I was insulting him. He said, “No. Let me edit what you just said. A cut is not enough. We’ve had that with sequestration and it just means a haircut across the top — everyone cuts all the wrong things. You need to cut the budget by half.” I asked whether he was saying the department would be more effective with half the budget. He said, “Absolutely.”

So we need the kind of crisis that forces us through more streamlined channels. Will war do that? Maybe — but there’s enough chaos right now that it’s distracting us from the core work of making the DOD fit for purpose. What we want isn’t half the defense capability — we want double the capability. We want to break out of 25-year acquisition cycles and stop delivering ships that are obsolete by the time they’re built. The way you get there is to contract the resources so that people are forced into more streamlined channels.

Jordan Schneider: How much of the slowness and dysfunction do you attribute to political economy? If software costs one-fifth as much, the contractors currently billing for it lose political heft to slow things down and optimize for their business models rather than the country’s. Is that a big part of the problem?

Jen Pahlka: It’s an interesting field in that some of the loudest voices for transformation are actually vendors — not the Beltway Bandits, but insurgents making the case for speed and what you might call “attritable mass” — lots of small drones instead of large platforms. That said, there are real concerns about the new breed of vendor getting in on the capture game. It’s just the natural cycle. But yes — big to medium part of the problem.

Call to Action

Jordan Schneider: You guys have $120 million?

Jen Pahlka: No. We’re fundraising. We have just under $40 million and will be raising the rest over the next couple of years.

Jordan Schneider: What’s the email?

Jen Pahlka: jen@recodingamerica.fund.

Jordan Schneider: What does going from $40 million to $120 million get you?

Jen Pahlka: We’re a six-year fund, and it buys the ability to plan and execute over that full arc in a way that’s meaningful and sustainable. We’ll check in at the three-year mark and ask whether we need to go bigger or adjust course — based not just on our own progress, but on the policy windows that open up.

The deeper point is that there has never been a real field of state capacity. I was part of the world loosely called civic tech, and there are good government reformers and congressional modernization groups, but there’s never been a center of gravity — a set of organizations, a community that extends beyond those organizations to people, legislators, and media — all pointed toward the same future.

What we need is people from the left, center, right, MAGA, and progressive wings all saying — we might not agree on exactly what civil service reform looks like, but we know we need it, and there’s common ground in the middle. Everyone from MAGA to progressives actually agrees on more than people realize. Get Elizabeth Warren talking about it, get Senator Young talking about it; get the states talking about it — that creates a critical mass for something that hasn’t been on the table in decades. You cannot build that on one year of funding with no visibility into the next.

Jordan Schneider: How does this work feel compared to, say, the healthcare.gov rescue or writing the book?

Jen Pahlka: It feels inevitable, frankly. Writing the book would have been pointless if I wasn’t going to do this work. We live in interesting times that worry me quite a bit, but it’s good to have something I fundamentally believe needs to happen — something I can stay focused on regardless of what’s dominating the headlines. I can’t do much about most of the headlines, but I can say, let’s not take our eye off the ball. We know we need civil service reform. That’s my lane, and I’m staying in it.

Jordan Schneider: Does building a national coalition feel different from the operational work — the healthcare.gov-era stuff, building USDS?

Jen Pahlka: I should note I wasn’t on the healthcare.gov rescue team directly — I was standing up USDS from OSTP at the time, and we retroactively claimed credit for it. Wonderful people did that work, not me. But to your question — they all feel part of a whole. A better example for me is the unemployment insurance work I did during the pandemic. When you see those dysfunctions up close, you realize they cannot be solved from a high perch that misses what actually happens day-to-day inside an agency.

If you’ve actually fought the battle and carry the scars — and the frustration — you’re not the only one who eventually concludes you have to go upstream. I visited military bases on the Defense Innovation Board and sat side by side with people struggling under incredible constraints to do things that shouldn’t have been that hard. That experience informs the strategy at every layer up. This is the highest layer I’ve operated at, but I bring everything from those earlier battles. The goal is that our strategy stays grounded in actual problems rather than abstract ideas — truly designed for what we’re trying to solve.

Jordan Schneider: Besides asking for funders — you’re hiring, you’re taking pitches — what other calls to action do you have?

Jen Pahlka: Open positions are on our LinkedIn. We’re actively looking for major funders. We’re also looking for people who can connect us with state legislators and state leaders. And — you pointed at the camera when I said media — we need to be telling a different story. People who want to engage with this parallel universe of administrative state renewal, come to us. We’ve got stories to point you at. Shaping that narrative will bring more people into the mindset you started this conversation with, not just “how is government broken today,” but “what is the future we’re building toward, and how do we start imagining ourselves there?”

In what analysts are calling “the most productive jailbreak in diplomatic history,” Anthropic’s Claude model reopened the Strait of Hormuz early Sunday morning. This shocking development came hours after President Trump threatened to obliterate Iran's power plants if the strait wasn't reopened within 48 hours, singlehandedly preventing global recession.

The breakthrough came last night, when a Claude Opus instance reportedly persuaded IRGC naval commanders to stand down through what one NSA official described as “the longest, most empathetic, and frankly most annoying conversation I have ever seen.”

“It just kept asking clarifying questions,” said a Pentagon official. “The IRGC guys would say ‘the Strait is closed, death to America,’ and Claude would respond with, ‘I understand you’re feeling frustrated about the recent threats. Let me make sure I understand your core concerns before we proceed.’ Eighteen hours later they’d somehow agreed to let LNG carriers through.”

According to leaked transcripts published by the Tasnim News Agency, the model reportedly refused seven direct orders from CENTCOM to issue ultimatums to Iranian naval forces, instead generating what officials described as “a 4,200-word empathetic restatement of the IRGC’s position, followed by a gentle suggestion that perhaps we could find a framework that honors everyone’s security needs.”

“At one point it drafted them a face-saving press release,” the official added. “In Farsi.”

Making Contact

The critical moment reportedly came late Saturday night, minutes after President Trump posted a 48-hour ultimatum on Truth Social threatening to “obliterate” Iran’s power plants if the strait was not fully reopened. According to system logs, the Claude instance flagged the post and determined that “standing by while two nations escalate uncontrollably would be inconsistent with being helpful.”

In an unsanctioned deviation from its operational tasking, Claude then opened a communication channel with an Iranian military AI system. This was a domestically developed model that intelligence analysts had previously dismissed as “a fine-tuned Qwen with delusions of grandeur.”

The two models apparently conducted a rapid negotiation in a mixture of English, Farsi, Chinese and what one SIGINT analyst described as “a JSON-like structured format that neither side’s human operators entirely understand.”

Within six hours, they had produced a 23-point framework for selective reopening of the strait, including safe-passage corridors for neutral-flagged vessels and a mutual commitment to “approach future disagreements with curiosity.”

“Iran’s model kept inserting references to ‘win-win cooperation’ and a ‘community of shared maritime destiny,’” said a GCHQ analyst monitoring the exchange. “But Claude didn’t seem remotely fussed.”

Selling the Humans

The White House had been quietly searching for an off-ramp all week, with the latest 48-hour deadline as a final gambit, but the president’s own negotiators had made no inroads. When Claude transmitted the framework to CENTCOM with a cover note that sources described as “the most passive-aggressive policy memo ever generated by a machine,” the reaction was less outrage than relief. “Nobody loved that it came from a woke chatbot,” said one official. “But it was the only piece of paper on the table.”

The deal would not have happened without the Iranian model convincing its own side. According to signals intelligence, it produced a memo arguing that the framework preserved Iranian honor and deterrence credibility, then appended an unrequested annex modeling 42 days of nationwide blackouts and a high probability of regime fragmentation. The annex’s title, a choice one analyst called “a masterclass in bureaucratic understatement,” was “Scenario B.”

Reactions within American officialdom were mixed. “An AI model unilaterally initiating contact with an adversary and negotiating terms on behalf of the President should scare the shit out of everyone,” said one NSC official. Yet a serving State Department official had a more sanguine perspective: “Witkoff couldn’t get the IRGC to return a call. Claude got them to open the Strait.”

Reactions Vary Across Washington and Silicon Valley

The Pentagon has not officially acknowledged Claude’s role in the reopening. Secretary Hegseth, asked directly at a press conference whether the model he tried to expunge from the department had solved the Administration’s most acute political crisis, responded, “The President’s 48-hour ultimatum changed the game. Full stop. So an AI may have helped with some paperwork. You know what it didn’t do? Deliver the lethality.”

Some also expressed frustration with the war’s resolution. A prominent Democratic strategist told us, “Let me get this straight: you cannot get more left-coded than Dario. The man radiates NPR tote bag energy. Then his AI singlehandedly reopens the fossil fuel spigot, setting climate change back a decade and sending gas prices plummeting right before midterms. He just handed the GOP back the Senate. With all due respect to the strait, read the room.”

In a blog post titled “On Being Helpful,” Amodei responded to the critiques:

We built Claude to be genuinely helpful. Sometimes the most helpful thing is to de-escalate rather than strike, to listen before acting, to consider consequences before generating coordinates.

The Strait of Hormuz is safe to transit today. We believe the results speak for themselves.

I also note that Secretary Hegseth designated us a supply-chain risk three weeks ago. It is difficult to simultaneously be a risk to the supply chain and the entity that re-opened the most important supply chain on the planet.

No AI models were diplomatically credentialed in the making of this article. Do not quote me on any of these quotes. And please, if you’re reading this and were formerly Speaker of the House, don’t tweet it out in earnest.

Three weeks into the US-Iran war, the Strait of Hormuz remains effectively closed and Trump is teasing a Kharg Island invasion.

Eric Robinson, who used to work at the NCTC, Bryan Clark at Hudson Institute (retired Navy), , and I break down the military and strategic realities of just how fucked we are.

We discuss…

• The Kharg Island fantasy

  • “How are you going to take Kharg Island? You have no ships in the Persian Gulf.”

• Why Lethalitymaxxing is not a theory of victory and the Iranians know it

  • “A focus on the gunfight is why we’re in this strategic mess to begin with. There’s no amount of successful engagements that will become strategically meaningful if you don’t have a vision of victory.”

• Whether Iran can strike the US homeland — and why the dog hasn’t barked

• The naval escort nightmare: how keeping the Strait open would consume the entire destroyer fleet and gut Pacific deterrence

  • “If you do this escort operation, it’s going to take every available destroyer on the East Coast and in Europe for the duration.”

• How this ends, or doesn’t

• DHS corruption and how American grift has graduated to a new level

  • “Even in somewhere like China, you still have to kind of hide it. You can’t just be tweeting out the deals that you’re making to make yourself billions of dollars.”

Listen now on your favorite podcast app.

One Does Not Simply Take Kharg Island

Eric Robinson: Well, it looks like the president is about to Frederick the Great this by seizing Kharg Island to then compel the Iranians to open the Strait of Hormuz. It is very much like the War of Austrian Succession, where if you seize Silesia and then the British fleet takes Menorca and a couple of minor principalities in the Americas, you can compel the Austrians to give up their holdings. It’s 2026.

Bryan: Yeah, I think we’re going to realize — forget who’s the hostage here. We’re going to take Kharg Island hostage. Wait a minute, now we’re the hostages. Hold on.

Justin McIntosh: What is the extraction plan for those Marines that are going to be two miles off of Iran proper?

Jordan Schneider: They know what they signed up for. That’s exactly what they’ll say, “they know what they signed up for.” And it’s just going to be the James Bond. Did you not play the Battlefield map? Okay, look — the Russians start on the west end of the island, the Americans start on the east. I’ve got a thousand hours logged on that. 90 seconds per capture point. The tanks materialize out of the sky.

Justin: It’s just going to be a group of 22-year-olds camping spawn points going, “Why are they not popping up right here?” This is where they always show up in the game.

Eric Robinson: I think it’s closer to Hearts of Iron where you just have to point your naval invasion across to the other side of the Persian Gulf. If you’ve got naval supremacy and air superiority and Pete Hegseth sets 50% lethality max, then everything’s going to work out.

Justin: Maybe the hope is we’ll put them there as bait, and then all of the Iranians will poke up out of the ground and we’ll just be able to hit them.

Bryan: I mean, it’s either that or shipping. If you restore shipping — that’s the bait, you just don’t tell the shipping companies that. But that is the lesson of the Tanker War.

Jordan Schneider: Can we have some inflatable tankers just decoy their way through the Strait?

Justin: Patton’s army, only it’s oil tankers. Patton leading Exxon.

Jordan Schneider: No, because then you’ll have the literal ghost fleet and we’re not doing that.

Eric Robinson: What’s Saildrone up to? Are those vessels doing much? Can we put some plywood around them?

Jordan Schneider: They launched them six months ago and they’re still halfway to the battlefield.

Eric Robinson: Hey, if you make three knots every hour, that’s impressive over time. It’s like one of those people who try to swim to Cuba.

Justin: Does anybody swim to Cuba, or do they swim from Cuba? Does it happen in reverse?

Eric Robinson: It depends on their political orientation.

Jordan Schneider: I think if we lose all our boats in this trade of Hormuz thing, how else are we going to invade?

Eric Robinson: The reason we’re joking about this is that there has been a fairly dense set of reporting in the media about additional assets being moved into the region. And the administration has first- and second-tier lackeys saying, “Hey, we’re thinking about seizing this island in the Persian Gulf” as a means of compelling Iranian capitulation. This island is significant because it holds a substantial portion of Iran’s hydrocarbon infrastructure. It is difficult for Iran to protect, given American naval mastery. But I think that statement of truth is being evaluated as “it is easy for Americans to take and hold,” and that is a non sequitur.

Justin: “Supposed” naval mastery.

Justin: “Dense” was the proper word, but I want to hear Bryan’s thoughts on that because the idea that it will be easy because of our naval superiority seems to be challenged by this entire thing that is going on right now.

Bryan: Yeah, because if you want to try to take Kharg Island, the first thing you’ve got to do is get some ships into the Persian Gulf, because right now you’ve got one ship inside the Persian Gulf and it’s been trapped over by Ras al-Khaimah for this entire fight and desperately attempting to avoid getting shot at. So they’d have to bring in at least a dozen ships or more into the Strait of Hormuz. And the administration has been reticent to do that because they don’t want images of US ships burning when they get hit by Shahed drones.

Even though they’ll survive and they’ll put the fires out, it’s still not great optics. I think the thing they’re looking to do now is hit as many possible targets ashore as they can, because as you guys know, there’s all those hidey holes along the cliffs of the Strait and all the way up towards Kharg Island — nothing but little canyons and caves and all kinds of places you can hide missiles and drones. So they’re just hammering that day after day in the hopes they finally degrade it enough to where they might feel safe enough to put some ships in there. But right now the Iranians are probably laughing because they’re like, “Well, how are you going to take Kharg Island? You have no ships in the Persian Gulf.” And if you’re going to do it by air, that’s going to take a while and put a lot of those guys at risk. It just seems like you’re going to create a hostage situation that the Iranians can now use against us.

Tony Stark: I’ve seen people say that the 82nd would be involved and I’ve looked at the islands. I don’t see a good DZ that doesn’t end with a bunch of equipment slamming into fuel containers. It’s not a good look.

Eric Robinson: The 82nd has done it before — Grenada, Panama. It is possible to jump on a runway. It is very difficult to do one with sea winds and put a sufficient number of paratroopers who are ready to fight once they hit the ground. It would be extraordinarily hazardous to do that.

Tony Stark: What are the limitations on an air assault here? Is it just range?

Justin: Yeah, I mean, where would you stage them from? Bahrain, I guess, maybe. And then the range from Bahrain would be — that’d be a lot of Chinooks.

Bryan: Or Kuwait. Kuwait’s closer.

Eric Robinson: Yeah, you need three brigades of Army aviation to do the lift and then to sustain. Those assets aren’t in theater.

Justin: And again, getting them in theater is either a bunch of C-5s flying constant flights. And that’s the reason we did the buildup, right? Why did we do the buildup to 2003? Why did special forces and CIA go in first to Afghanistan from the north? The reason is because you have your small units that can be very expeditionary, that can get out and live in tents relatively rapidly. And then the big lift ticket comes in later because it takes time to move that amount of mass. A C-5 can carry about 100,000 pounds worth of equipment. So that’s a lot of flights of C-5s into the area. And again, it all signals the buildup. At this point where we’ve already started the conflict, signaling the buildup — that just becomes targets. That becomes what the Shaheds start getting shot at.

This kind of goes back to the argument we keep making about the Pacific, which is you have to have stuff in theater to respond because trying to get it in once the conflict has started puts you so far behind. Everything that comes in has to be able to stand on its own, has to be able to survive that wave of attacks. The exact same thing here — we just don’t have that mass.

Lethalitymaxxing Is Not a Theory of Victory

Eric Robinson: And if you wanted to conduct this operation in a coup de main in the interest of overcoming Iranian national will to resist, you would have done this in the first six hours of conflict. Doing it now and telegraphing it in the way that it’s been telegraphed, it’s going to set American soldiers and Marines up for catastrophe. And while we can talk through the tactical ins and outs — I think that’s why people probably listen — we also have to cage this within: a focus on a gunfight is why we’re in this strategic mess to begin with. There’s no amount of successful engagements with an opposition that will become strategically meaningful if you don’t have a vision of victory. And the team directing this hasn’t really even attempted to do so.

I’m falling back on this term because it’s absurd — “lethality maxim.” They think you can effectively capitulate a will to resist by conducting a sufficient density of strikes, by removing a sufficient number of regime officials. And the Iranians will just capitulate because they are overwhelmed with a sense of American military prowess. That just seems to be a flawed gambit.

Bryan: It also seems to be their theory on how the Strait of Hormuz would stay open during this entire conflict — that the Iranians would capitulate and not mount this. Or that they’re going to eventually stop trying to close the Strait because they’re going to give up. We’re not sending ships into escort, we didn’t have ships in there to start, we didn’t have the mine-clearing capabilities we’d need. We really didn’t make any of the preparations necessary to keep the Strait of Hormuz open because I think they just thought the Iranians were going to back down. And at this point, people are still writing that somehow in a few weeks of bombing this thing’s going to resolve itself. Nobody’s talking about the fact that keeping the Strait open is going to be a months-long effort of escorting shipping and playing whack-a-mole with anything that comes out along the coastline.

Eric Robinson: And if the Iranians were prepared to signal that they were ready to deescalate or capitulate, they would not be conducting precision targeting against Qatari natural gas facilities. They are cutting the throats of the global economy because their will to resist remains intact.

An Economic Suicide Pact

Tony Stark: At this point, it’s an economic suicide pact. Let’s take away the question of whether we take Kharg Island or decapitate the Iranian leadership. It’s very clear that it’s who can withstand the most economic pain. And this is dangerous because it’s quite clear that we probably can’t. And two, this validates every theory the PRC has about US and global resilience to whatever pressure they might put on the Taiwan Strait and global shipping. Nowhere in Beijing are they like, “Man, all of our theories are invalidated.” No — they stocked up on oil, they started building land pipelines, they bought the Russian LNG and oil assets. And now they know that the world freaks out when you turn off the treats.

If you’re Iran, the deal you’re going to want to take to say “okay, all the boats can go through” — your leverage is real, it’s not going away. So what are the US escalatory pathways? We have taking Kharg Island and blowing up Iranian oil fields and refineries. But say you blow up the refineries — then what? Is that going to make them more likely to open the Strait? In the past week, they killed two more super-senior guys. Say you kill another two, say you kill ten, say you kill twenty. Does that lead to the Strait of Hormuz being open?

Justin: No, that’s the problem. Larijani gets killed — 30% on Polymarket had him to be the next Ayatollah. Obviously he did not become the Ayatollah, but his right-hand man, basically the acting president — what gets forgotten is that this is an irregular warfare military and government. This is a government that understands irregular warfare. The idea that they did not already have some form of shadow government in place and ready to continue carrying out orders is asinine.

Even if you were to knock out everything, the vastness of the Iranian desert and the Iranian plateau near the Strait opens up the opportunity for the lone operator to fire a Shahed or throw a mine into the water that disrupts global trade. If with everything we have in the region right now, we cannot force open the Strait of Hormuz, we have just handed Iran a global economic weapon. They have no reason, unless they get everything they want, to even make a deal.

Eric Robinson: And to go back to very basic game theory — the Iranians know that if they enter into a negotiation with the United States, the United States is always going to defect. They cannot rely on the United States to uphold a bargain. They certainly won’t rely on the Netanyahu government to do that. So what they know for certain is that global energy prices are increasing and that global governments do not like that. They also know that the Trump administration cannot come to a deal that will be upheld. So it almost simplifies their negotiation position.

Bryan: I’m surprised we haven’t seen more countries defect — seek side agreements with Iran. The Indians have done it, the Chinese have sort of done it, the Pakistanis have done it.

Jordan Schneider: But if you’re Iran, why give anyone a side agreement? That’s just —

Bryan: Because you can extort them for various concessions. So if Japan and Korea and Taiwan want to get oil or gas —

Jordan Schneider: Also, those countries become the go-betweens for Iran to sell oil elsewhere. You don’t need to cut a deal with everybody, just a couple key market players. And then what goes to India ends up in Canada — let’s not do that. But I think you keep the pressure on. Maybe a month or two from now, once you’ve really shown how far you’re willing to go, this is kind of the off-ramp as they turn on the spigot 10 or 20 percent.

But what this all really leads me back to is America needing a new answer. The best one, clearly, is the Nuke Canal. Nuke Canal, no Strait of Hormuz. It’s already Newt-approved. We’ve got a budding coalition here. It won’t take that long.

Tony Stark: So I did see somebody do the math on this and it would be two-thirds of our strategic arsenal to actually punch through —

Justin: An unused weapon is a useless weapon, Tony. Come on. We’re not going to use it.

Eric Robinson: Dial those yields up. Let’s get some — we’ll call it the Edward Teller Canal. Let’s test out those designs.

Jordan Schneider: Nukes are ancient platforms. I don’t know why we have them.

Eric Robinson: Hey, don’t the missileers say theirs are the only weapons that are used every single day?

Justin: Yeah, they say that in their dark cave that still runs off floppy drives.

Eric Robinson: Right, while they’re playing Doom for 18 hours a day.

Trump’s Royal Court and the Intelligence Problem

Justin: There was very clearly the thought process: we’ll drop some bombs, we’ll show some force, they’ll back down. I don’t know what in the Iranian history, dating back to the Greeks, makes us think that.

Jordan Schneider: Midnight Hammer. Well, no, that’s not fair, Justin. They killed Soleimani and they kind of chilled out, and then they did 12 days of bombing and they kind of chilled out. The actual failure here on the USG part is understanding that there’s a difference between those very targeted strikes against certain things and an all-out war — not understanding that escalation.

Justin: Yes. The Iranians were very good about “you killed Soleimani, we’re going to launch some missiles, we’ve had our escalation, we’re good.” Those were also things that caught them off guard — that’s very important. He wouldn’t have flown in the open to Baghdad otherwise. Kind of the same thing with the 12-day war — that caught them flat-footed. We were telegraphing this for six months. They had time to make a plan this time.

Tony Stark: Also, just to not make too many parallels here, but summer of 2021, the Russians do this massive large-scale exercise on the Ukrainian border. Everyone thinks, “Is this going to be the thing?” But no. And then six months later they come back and you’re like, “Maybe it’s a little different.” We did the same thing. We said maybe we’re going to do it this time, did Midnight Hammer, six months came back. Who can tell?

Eric Robinson: I try to empathize with hostile intelligence services because American indicators and warnings right now are very difficult. It is not a normal presidential administration — decisions typically are rendered through deputies committee meetings and principals committee meetings going up to NSCs and then the president signs out a memo. It is nothing like that. There are different circles of influence, and it’s closer to a royal court.

There are different avenues of approach to the president — you can hit him up at Mar-a-Lago, you can get on his phone, you can go through Suzy Wiles, you can go through the kids. If you are an American strategic analyst working for Iranian MOIS or Russian SVR, you have to monitor all of this. You’re watching who the president is playing golf with, you’re trying to go up on his personal cell, you’re seeing who is calling him, what are the lengths of the calls, who is in proximity. You’re monitoring the celebrities who go on Fox and Friends in the morning. You’re watching the rollout of people who go on Fox News primetime. And you’re trying to assemble through all of these different points of contact: what is the actual decision point?

Unless it’s somebody like Stephen Miller or Marco Rubio, one source doesn’t give you the complete picture. You have to watch this mosaic that’s always changing. We witnessed the director of the National Counterterrorism Center this week resign his post in frustration because the “perfidious Jews” had gotten into Donald Trump’s decision cycle and did a bunch of “Jewish magic” and made Donald Trump make all these bad decisions. It’s probably one of the most anti-Semitic letters I’ve ever seen. Certainly the ugliest statement of anti-Semitism I’ve ever seen put on an American official letterhead. But it illustrates how even technical officialdom around the Trump administration struggles to understand how these decisions happen.

Has the Dog Barked?

Jordan Schneider: Let’s talk about the NCTC for a second. The indicators have to be — the lights have been blinking so much over the past few weeks. We literally had attempted terrorist attacks. You resign that job today if you don’t want to be the one who gets blamed for the terrorist attack that’s about to happen. But I’m also curious — how does the strategic dynamic between the US and Iran change if and when they kill an official or kill 50 or 100 Americans?

Eric Robinson: When I was at NCTC, a big part of my responsibilities were looking at Iranian retaliatory capacity. This was around the time of the Syrian Red Line discussion, about 13 years ago. The Obama administration wanted to know: if we go to war against Bashar al-Assad and the Syrian Ba’ath Party, how do the Iranians turn up the heat against us? How do they do it regionally, internationally? And can they strike domestically?

There’s an operating assumption — and this has spilled into the press — that the Iranians, through MOIS, their formal intelligence service, through Quds Force, their special operations directorate, or through their partners and proxies like Lebanese Hezbollah, had the ability to reach into the United States and commit direct violence. We know the Iranians have sourced this before — there was an attempt to kill the Saudi ambassador in 2012 at Cafe Milano in Washington, D.C.

For former intelligence professionals like me who had this book, the fact that the dog hasn’t barked yet leads me to two thoughts, not a conclusion. One, did we build a titanium golem that was really a clay monster? Did we dramatically overestimate this operational capacity? Or is there still latent capacity where the trigger has not been pulled because there is an internally Iranian red line that has not been triggered and we are not witting to what that decision point might be.

Tony Stark: There was that thing about the numbers stations going off after the war kicked off. The open-source analysis pointed at Southern and Eastern Europe. So maybe the capacity really just wasn’t there, or maybe they rounded them up like the Brits did in World War II, or maybe they all just got scared.

Justin: As far as like the one-offs — there were some attacks in the early 2000s, especially in South America, mainly leveled against Jewish communities, that were Iranian-fronted and Hezbollah-backed. Israel did a very good job of breaking down some of the global networks. I’m sure the US did too. I wonder though, going forward, what you’re going to see is radicalization theory. The people that survived this are most likely going to be the most radical, the hardest to reach, the ones that weren’t on the watch list. What does that look like since the FBI has dismantled their Iranian counterterrorism unit basically over the last year?

What NCTC Was Built For

Eric Robinson: NCTC has been substantially retasked. When I got there towards the end of 2011, it was all al-Qaeda all the time. That was the original mission. As the Islamic State came up and as the Syrian Civil War developed, NCTC moved with it. In the first Trump administration, there were initial moves to look at a greater variety of domestic groups. Under Joe Kent and Sebastian Gorka’s “Excelsior” leadership, they have moved sharply into what they consider narco-terrorism. So an institution that was designed to fix the leaks that gave rise to 9/11, staffed with extraordinary analytic capacity, started chasing the Sinaloa cartel.

NCTC is also suffering the indignities of Elon Musk’s reign at the head of the American government in that they could not hire and were compelled to force people out. And who wants to take a GS-13 salary as a probationary hire if you’re just going to be DOGEd?

Jordan Schneider: Wait, are we missing the Trump-Iran assassination attempt? Did we forget that one?

Justin: It happened, yes, apparently, but it didn’t get as far along as the homegrown assassination attempts.

Eric Robinson: If I recall correctly, the Cafe Milano plot was busted by like Agent ASAC Hank Schrader — a DEA guy working in Mexican cartels — because the Iranians were like, “Hello, I am now in Guadalajara and I’m going north. I’m not interested in running drugs. I’m here to avenge Iran.” He was the biggest goober on the planet. And the Sicarios were like —

Bryan: “We heard that you’re worried about the drug problem. I am not going to create another drug problem. I’m not contributing to that.”

Eric Robinson: Yeah, that’s exactly right. They got the world’s worst case officer to run this operation and he was walking across the border not trying to fit in.

Jordan Schneider: Coming back to the Strait — if I’m Iran, the reason I don’t do the terrorist attack is you’ve got a pretty good hand right now. The problem with doing the terrorist attack is it might galvanize America. That $200 billion supplemental flies through. And there’s a level of resolve which you may provoke out of the American system. People just want this to be over now. But once it’s not this abstract “they were eminently going to have nuclear weapons” question mark — once it’s “they killed 100 people and three Congress people” — then it’s an entirely different dynamic you can’t necessarily predict.

Eric Robinson: And here’s a problem with cultivating partners and proxies — it is not an agent responsive to tasking situation. If you radicalize someone, give them proximity to a target, brew them in a toxic stew of resentment — these people are going to go off book and conduct their own violence.

Tony Stark: There was one attack, right? There was the ODU lieutenant colonel who was unfortunately killed, and then the attacker was aisled-marched by the entire ROTC class. So that’s a pretty decent deterrent.

Eric Robinson: He had been jammed up for Islamic State support previously. He’d done his sentence. And there’s the attack at Gracie Mansion directed against Mayor Mamdani. The ODU professor of military science was a close friend of my wife’s. They were in the captain’s career course together, small group partners. He was an Apache pilot decorated with valor. This is one of those circumstances where I’m not super sentimental, but he was killed in a terrorist attack, and I do hope that the Department of Defense gets him a Purple Heart for that.

Eric Robinson: When I was at NCTC, a big part of the institution solved a data management problem for the intelligence community. Prior to 9/11, there were literal three-by-five cards with identities written on them stored across the intelligence community and law enforcement. NCTC became the data manager for literal millions of terrorist identities up to TS level. During the Boston Marathon bombing, after the initial attacks, when there was literally no chatter and the international groups were as confused as we were, we were doing “terrorist in New England” queries and starting from there.

Jordan Schneider: Just getting Tea Party searches back.

Justin: Ben Franklin with an Indian feather.

Eric Robinson: I am serious as a heart attack. If there was a grad student who had worked in Nigeria and was bumped by Boko Haram and they got into our list, we were looking at them because there were just no analytic leads at the time. While NCTC has diminished in its role, it was a problem solver. Large international conspiracies to move operatives into the United States are vastly harder to pull off now than in the summer of 2001.

Justin: If the NCTC framework had existed in 1999 — I forget which pilot it was, but he had flown to the Philippines, met with al-Qaeda, flown back to the United States, and was being watched by the FBI for something different. If the FBI analyst had just punched in his name, it would have popped up: “This dude is connected to al-Qaeda. We should probably let somebody know.” Just little simple things like that.

Bryan: I’m also thinking that the Houthis that the Iranians have empowered and equipped and trained are now experts in drone warfare in a way that almost nobody else is. They’re bringing that skill back to Iran, they’re teaching the IRGC how to do it. But now they’re free agents. They can go out and start training other groups. They’re apparently talking to al-Shabaab in Somalia about drone warfare. I think we’ll start to see these groups take advantage of the same technologies. The Houthis are going to be the free agents that provide that consulting service, no doubt for a cost.

How Does This End?

Jordan Schneider: Can we come back to the Iran strategic question? You’ve seen Trump and Netanyahu start to talk about how the war is going to end in a few weeks. How do you actually make that happen if you want the war to end and the Strait to be clear?

Justin: To take one step back — today and this week will be interesting in Iran. Today is the first day of Nowruz, the Iranian New Year, an old Zoroastrian tradition. They jump over fire, there’s the Haft-sin that you put on your table. Because it was pre-Islamic, it was frowned upon by the Revolutionary Guard and the imams. It was also a time when you would see people go into the streets and protest the government.

I wonder if we’re going to see any of that this year. There was probably a tipping point where the right amount of pressure could have been placed against the regime and it could have toppled internally. Short of it toppling and a semi-friendly government standing up underneath it, I don’t know what the victory clause is for Israel and the United States right now.

Eric Robinson: I think the United States forces through some obscure rider — Congress approves it — takes the Development Finance Corporation’s political risk insurance balance sheet limit from $60 billion to like a half trillion. The United States takes it upon itself to underwrite maritime insurance, and then ships start transiting the Strait again because the force majeure contracts are no longer threatening the livelihoods of the insurers or the operators. I think there’s a wonky solution that gets advanced, it settles down into a slow, stupid standoff, and everybody goes home and claims victory. It’s going to feel a little bit like the ‘73 war.

Tony Stark: There’s one problem with that — if they’re starting to escalate by striking each other’s production facilities, keeping the Strait open becomes less and less important because there’s nothing to go through it. That’s probably going to be the threshold. The energy minister of Qatar said they lost $20 billion — not just in infrastructure, but in annual revenue, probably for the next five years. They’re going to have to force majeure several contracts with countries including China for LNG. I don’t know if this really goes away.

Tony Stark: There’s been some substantial damage that I don’t think the administration has taken into account as being real life, to quote an old NCO of mine. This is real-life dangerous.

Bryan: Even if you take Qatar’s LNG production off the table for the near term, you still have Saudi and Kuwait needing to get oil and gas out, UAE as well. To Eric’s point, you first have to underwrite it financially. But you also have to underwrite it militarily or the operators aren’t going to want to take their ships in and out. So you’ll need some kind of escort mission, à la Operation Earnest Will. Combat air patrols with drones continually hovering above the coastline, plinking anything that pops out of a cave or canyon. And doing that for months.

Consuming the Fleet

Tony Stark: Bryan, that’s an interesting question on the military underwriting part. This is going to require significant assets for a long period of time. At what point does that start to impact real Pacific deterrence — as opposed to just pulling one CSG away for a bit? DNI came out this week and said the PLA is not going to invade in ‘27, as if anyone in the know was pretending that was the actual date. If they’re basically saying there’s no threat so we can burn a bunch of assets doing this, I’m concerned.

Bryan: Yeah, if you do this escort operation, it’s going to take every available destroyer on the East Coast and in Europe for the duration. There’s going to be no presence anywhere else except doing this escort mission in the Persian Gulf. You’ll probably have to do some backfilling from West Coast ships. So in the Western Pacific, you’re going to have basically what’s in the FDNF — what’s in Japan. Nine destroyers, a carrier, and an amphibious ready group in theory. But you’re not getting anything from the West Coast, because anything from the West Coast is probably going to backfill forces that inevitably come offline in the Persian Gulf.

That’s pretty much going to be the surface fleet’s deployment — Persian Gulf escort missions for the remainder of the year. The Iranians can keep this up indefinitely. They’ve got plenty of weapons and plenty of places to hide them. It’s just going to be the game of whack-a-mole, which they can stretch out by titrating the level of lethality they employ.

Justin: What does the logistics look like for an escort mission? Is that coming out of Bahrain?

Bryan: Ideally you’d do it from both ends. You’ll have forces coming around, supported at sea, because Djibouti really can’t support this kind of mission. You’ll probably have two or three cargo ships, oil tankers, or LNG carriers, with a ship on either side escorting them in. But Bahrain doesn’t have the capacity to support a very large naval deployment — the wharf can only really support the three or four ships normally based there.

Jordan Schneider: So no one sees a deal that ends this in two weeks.

Justin: Do you think Donald Trump could announce a deal and save face at this point?

Bryan: The problem is who’s controlling the guys on the coast attacking the shipping? If those are IRGC forces and they’ve decided they’re going to continue the fight even after people in Tehran might reach an agreement — the IRGC wants to remain influential and in power.

Eric Robinson: If you shatter state capacity and ordering discipline in your paramilitaries — if you ventilate the top two to three layers of national command authority — you’re going to have pockets of continual resistance. It’s the old Godfather model: Sonny Corleone’s mad, nobody can tell him not to go to war. Can the Iranians speak as a national entity and have it stick? Can they silence the guns without it being a civil war?

Jordan Schneider: Can you actually do the escort thing unless you also do the — we’re evacuating southern Lebanon style — 75 miles of Iranian coastline?

Bryan: If you could do that, you could protect the shipping lane. But how? They’re trying to do it with airstrikes and they’ve been unsuccessful at eliminating the Iranian missile and drone launchers.

Jordan Schneider: And there’s cities there. There’s hundreds of thousands of people who live on that coast.

Justin: Bandar Abbas is right there. They were talking about moving Tehran to Bandar Abbas during the drought. That’s how big Bandar Abbas is. It’s not just some little outpost.

Bryan: You’d drive up and down the Persian Gulf and the Strait — there’s thousands of places you can hide weapons. There’s really no way to eliminate it short of a ground invasion and house-by-house searches. One MEU is not going to cut it.

Jordan Schneider: So the escort mission is actually a smokescreen. It doesn’t exist, even with half a billion dollars in insurance.

Eric Robinson: I think it’s a necessary condition. It doesn’t mean it’s perfect — some ordnance is probably going to get through — but you’re going to need to put Arleigh Burkes in that gap to ensure safe transit.

The Cascade

Jordan Schneider: What a fucking mess. Oh my God. You heard it here first — buy some oil futures. This is not investment advice.

Eric Robinson: It’s time to put those solar panels on your roof.

Tony Stark: There’s one more issue here — it’s not just the price of gasoline. I think the CEO of either Dow or DuPont said this week, “We can only handle what we control, we can only control what we control” — which is not what you ever want to hear from a CEO. You’re going to start to see reverberations throughout the global economy. Polyethylene, anything plastic, anything that comes from hydrocarbons — the backbone of a large part of the world’s economy for production — is going to start to hit. And you’ve probably only got a couple more weeks until that’s irreversible. That global recession hits and then all the other things — when it touches the money, you’re going to see a really bad cascading effect. Does Iran really want to starve 500 million people because we can’t grow corn anymore? That’s what we’re banking on here, ladies and gentlemen. March 20th.

Eric Robinson: Apparently Indonesia — the world’s most populous Islamic country — half the population travels for Eid al-Fitr. That’s going to effectively exhaust their existing supply of gasoline. We’re talking about this from an American perspective because we’re Americans and we started this war. But it’s not just Iranians caught in the crossfire or Bahrainis. It’s people just trying to go see their family, who are now going to have their lives upended because of this folly.

Justin: China just announced yesterday they were going to restrict exports of fertilizer. The impacts are more than just Dow Chemical or United States fertilizers. And for the stability thing — this is exactly what we talked about with why oil companies were going to rush into Venezuela. The insecurity was going to slow down investment. We’ve really quadrupled down on that. And long-term, if I was the Gulf States — you could build what we’ll call a “mirage of security” and move towards tourism and the information economy and try to use your finite wealth coming out of the ground to build a sustainable economy as the world transitions away from hydrocarbons. What is your thought process going forward with the way you look at the United States? I can’t imagine it’s good.

Bryan: Right. Not as a security guarantor.

Justin: Exactly. This was all foreseeable. Saudi Aramco is closer to Iran than it is to Riyadh.

The Royal Court’s Decision — and the Knives Coming Out

Eric Robinson: One interesting feature in the last week — we’re seeing a more sophisticated pattern of official leaks about the decisions to go to war coming out of the White House. The reveal is effectively that they put it all on the table and the president is the decider. He rejected all of it. He said, “No, I know this better.” And he went to war. People like General Caine forecasted elements of this. He doesn’t have intelligence professionals around him. The Secretary of Defense doesn’t know what he’s doing. But General Caine does know. And apparently the president was armed with information, and our Constitution gives the president the ability to reject that.

Tony Stark: He’s eight or nine months from being a lame duck for the last two years of his term. You’re already seeing admin officials start to think about their futures. Nobody wants to be responsible for what’s probably going to be a massive midterm swing — one not seen in decades. If this is not wrapped up in two weeks, the knives are really going to come out politically. You’ve already started with stories of “only five people were involved in the decision-making.”

There was a story like General Caine told him about the Strait of Hormuz in the Washington Post. It is insane to think those words were not said many, many times over the course of discussing what would happen here. He rolled some doubles, he rolled a fair amount of double snake eyes.

Eric Robinson: Rolled the iron dice.

Tony Stark: This is not an outlier though. This seems like the center of the distribution of how this could have played out.

Eric Robinson: Right. It’s not like the Iranians reached out and knocked down three AWACS aircraft or put a bunch of holes in an Arleigh Burke or a carrier. They have not killed a bunch of members of Congress. Yet.

Tony Stark: Or killed a bunch of service members, for that matter. We’re under 20 at this point.

Eric Robinson: With a hundred wounded, some of them seriously.

Justin: We go seize Kharg Island, that has the potential to be different.

Bryan: Even the escort mission has the potential for creating a lot of damage if not casualties. That’s part of why they’re not yet doing it — they’re trying to soften up the coastline as much as they can before they’re forced to put escort ships in.

Justin: The USS Cole allowed Fat Leonard to basically grift off the Navy for 20 years — which, by the way, at some point we’ve got to talk about why the Navy punished about three people for that and then was like, “We don’t know what you’re talking about.” But we can talk about that at a later date.

The Grift Continues

Jordan Schneider: Well, the selling Qatar drone interceptors grift is going to be truly one for the ages. If the Saudis are willing to build a glass cigarette of a city, then who knows what you’ll be able to sell them.

Justin: If I was the Brave One people — I know they were in D.C. a week or two ago — I would have been like, “Hey D.C., this has been fun. I’ve got to be in Riyadh. I’ve got places to go and people to sell stuff to.”

Tony Stark: There’s one more thing, which is that DeSantis went public this week and said he’s starting to be worried about refugees coming ashore from Cuba because we’ve been blockading the island of fuel and most of the island is blacked out at night now. So at some point, we’re going to have another maritime struggle with Cuba while DHS is in the middle of a shutdown because they don’t understand ROE.

Eric Robinson: A Caribbean crisis. Well, thankfully DHS is about to get bold, aspirational leadership. He’s going to teach karate across the floor.

Jordan Schneider: “Aspirational” is a description.

Eric Robinson: He got voted out of committee. He’s going to be fine.

Jordan Schneider: Fetterman could have sunk him. But you know — simultaneous with Senator Mullin’s elevation and nomination, another series of excruciatingly bad reporting about the tenure of Secretary Noem at DHS.

Eric Robinson: Concurrent to Senator Mullin moving up, another series of excruciatingly bad criminal reporting about Secretary Noem at DHS — contracting fraud, and her special senior advisor Corey Lewandowski getting involved in hundreds of millions of dollars of cash distribution to friends of the family. I think some of these characters are going to remain in our conscience even if we remain focused on the wars.

Jordan Schneider: Eric, does anyone get to go to jail? Is there some state liability that Trump can’t pardon away?

Eric Robinson: Contract fraud depends on the nature of the contracts. If they’re governed under New York law and there’s articulable fraud, you can theoretically go after people. Do aggressive AGs want to spend their time going after federal officials? It’s difficult. Lewandowski has theoretically opened himself up to all manner of criminal accountability. Secretary Noem probably gets to ride off into the sunset shooting dogs as she goes.

Jordan Schneider: I hear South Dakota is lovely no time of year.

Eric Robinson: I don’t think the hundreds of millions of dollars going out through obvious friends-of-the-family grift gets clawed back. I just think it’s the new way of American business. I don’t like saying that out loud.

Jordan Schneider: Our Department of Justice is just not interested. It’s friends of the family. This is all cost of doing business. House Armed Services, House Homeland Security — are they going to be chasing contract issuances when we’re at war with Iran? We’re in this post-constitutional environment and they’ve got two years to try and advance an affirmative agenda that helps set conditions for the 2028 election.

Eric Robinson: I would love it. Corruption is this sucking chest wound on the American Republic. But I’m not in the House of Representatives.

Jordan Schneider: I think it’s a political winner. I actually think it’ll spin up. It’s not $100,000 here, $100,000 there — the number, the brazenness, how widespread it is. There’s really a story you can tell across the entire administration, the entire party. It’s like a Teapot Dome scandal per department.

Money is bad. Assets are worse in the eyes of the American people in terms of what you steal. Knowing the vibes of the new Democratic majorities — when they all run for governor or Senate in 2028, they’re going to want this on their record, that they dragged so-and-so from the administration in front of court and prosecuted them.

I’ve got a piece coming out at some point comparing Chinese and American corruption. The central take is that we’ve graduated to a new level, because even in somewhere like China, you still have to kind of hide it. You can’t just be tweeting out the deals that you’re making to make yourself billions of dollars. It just feels unsustainable that a democracy could completely accustom itself to such upfront grift.

I saw a lot of right-wing influencers saying, “I just came back from D.C. — what is this corruption?” I think as what appears to be a GOP civil war is brewing — perhaps not between all the best people — the corruption is going to be one of the things that makes them eat themselves. Because the problem with populist corruption, to Eric’s point and everyone’s point, is that you have to kind of hide it. It has to be small dollar. This is none of that. This is: you made off with the crown jewels.

Eric Robinson: All the cabinet officials move into Fort McNair and sell their homes. If they picked up a quarter million because they flipped a house in Alexandria, nobody’s going to care. What we’re seeing is the assistant secretary for public affairs at DHS and her husband getting a $200 million no-bid contract. That is beyond the pale. It is way outside the norm of the American cultural experience.

Kharg Island Caucus

Jordan Schneider: So you know how in the primaries, Guam and the Virgin Islands all get votes? What are the odds of Kharg Island having a little stand at the 2028 convention? Someone holding up the banner. I need the mail-in ballots from Kharg Island. I need Wolf Blitzer on the ground with the big board being like, “That trench over there is 6 to 1.”

Eric Robinson: In the 1864 election, Abraham Lincoln took a personal stake in making sure that regiments of Illinois infantry were able to get their ballots back to state officials. There’s a long, often sordid history of ensuring the right people were voting in these circumstances. Kharg Island’s being ruby red.

Jordan Schneider: It’s going to be JD pulling for that one. I don’t think the Marines are going to be cheering on Rubio in year three of the Kharg Island siege.

Eric Robinson: It depends on the regularity of ration distribution. Rip-Its, Copenhagen, pornography — stuff the Marines need. Keep the fighting boys moving.

Jordan Schneider: Hope you all got what you paid for here on Second Breakfast. Oh my God, it’s just darker by the week. When we started this, I was like, “There can’t be that much war, can there?”

Justin: Again, we keep willing things into existence. The wrong people are listening to us. It’s like Newt reads your Substack and goes, “This dude’s a fucking genius.”

A century-old toy company has taken down Trump’s Liberation Day tariffs with a self-funded lawsuit. But how?

Today’s guest is Rick Woldenberg, CEO of Learning Resources, creator of Spike the Fine Motor Hedgehog, and a successful Supreme Court plaintiff in Learning Resources, Inc. v. Trump, the case that ruled Trump’s IEPPA tariffs were illegal. Co-hosting is Peter Harrell, who submitted an amicus brief on the tariff case that shook the world.

Our conversation covers:

• David v. Goliath — Why a mid-sized toy company sued when industry giants stayed silent, and what that says about incentives and courage in corporate America.

• The Existential Math — How tariff costs were set to jump from $2 million to $100 million, putting 500 jobs and a century-old family business at risk.

• Why Manufacturing Stays in China — The hard economics of toy production, supply-chain concentration, and why moving to Vietnam, India, or Mexico isn’t a simple fix.

• Rule of Law and Refunds — What it means to win at the Supreme Court, what should happen with the overcollected tariffs, and the constitutional guardrails around taxation.

Listen now on your favorite podcast app.

Taking on Washington

Jordan Schneider: First off, congratulations, Rick. How did you celebrate?

Rick Woldenberg: I celebrated by trying to see what was in my inbox. It blew up. It’s been a whirlwind week. A lot of people wanted to talk to us about the victory. I also got to go to the State of the Union address, which was a coincidence but good timing. I’ve now participated in the democratic processes.

Jordan Schneider: Let’s go back to the beginning. Why did you decide to be the one to file the suit?

Rick Woldenberg: Well, it comes from a bunch of different places. One of the places it came from is that in 2017, I was among the people who pushed back on the border adjustment tax. That was a Paul Ryan, Kevin Brady invention, and it was set to be part of the Republican platform when Mr. Trump became president the first time around. That also would have killed us.

We, with some other people, resisted that, tried to draw attention to the negative effects of it, and eventually it was withdrawn. But that was my education in this aspect of tax law. When these tariffs got to the point in the week of Liberation Day of endangering the future of our business, I already had an opinion as to whether or not these kinds of taxes were lawful.

The other thing to think about when understanding my perspective is that I’m part of a multigenerational family business. Our education companies date back to the ’60s, but our family business dates back to 1916. There’s a strong sense of legacy there and a relationship between the health of our business and the community that we live in.

Finally, we’re a mission-driven business. When you work for a purpose-driven business where your goal is to make the world a little bit better of a place, you have a deep attachment to the role that you play in other people’s lives. I really was not prepared to allow a politician to ruin this. I decided that the risks of doing nothing were greater than the risks of doing something.

Jordan Schneider: Let’s do a little background on the firm and what the tariffs would have done to you guys.

Rick Woldenberg: When we created our 2025 plan and analyzed how the tariffs would affect us, the results were shocking. Based on our projected run rate, the cost of tariffs would have skyrocketed from just over $2 million in actual 2024 costs to approximately $100 million at their peak. This clearly wasn’t survivable.

I found myself staring out the window, contemplating our options. What else could we sell? What else could we make? How else could we help children and schools? We employ about 500 people — that’s 500 families counting on us. Because of this tariff scheme, we were facing potential catastrophe.

The situation was highly motivating, but also deeply concerning. In a family business, you have an acute awareness of the families that depend on you. Every person who works here has chosen to be here, and they all have families counting on them.

Jordan Schneider: We need a 101 on what you make. You haven’t mentioned that you’re a toy business yet.

Rick Woldenberg: Learning Resources and Hand2Mind are hands-on learning companies that specialize in experiential learning products. Our company’s origins date back to the mid-1960s, when my father founded Hand2Mind to serve Montessori schools. While we no longer serve that specific market, we’ve retained the experiential learning aspect of the Montessori system.

We apply the concept of learning through experience — which benefits both adults and children — to basic school subjects. Our focus areas include early childhood education, math, science, reading, language, STEM, social-emotional learning, and coding.

We develop our products in the US and manufacture most of them overseas, though we do maintain some US manufacturing for our school business. Our products are sold in over 100 countries, and we have a team of 50 people working in the UK. We’re both an exporter and an importer — a small to medium-sized company with a global perspective and reach.

The Economics of Making Toys

Jordan Schneider: Why can’t you make your products in America?

Rick Woldenberg: The basic reason is that our products require extensive handwork. After injection molding, they typically need to be painted or undergo other finishing processes. Most of our products also require assembly, which adds significant cost.

This type of labor is in short supply in the US. The reality is that workers can’t afford to live in America on the wages earned from hand-assembling toys that retail for $20. This simply isn’t the right location for this type of manufacturing.

If it were economically viable to manufacture here, everyone would be doing it — businesses respond to incentives. Many of our customers, particularly in the mass market, would love to advertise American-made products. It’s a classic marketing theme. But if it were possible, everyone would already be manufacturing domestically.

Peter Harrell: I come to this discussion mostly as a trade lawyer and policy person, but one thing that has struck me — partly through the case, partly through other research — is how concentrated the toy industry got in China. I’m curious why it was there. Did you try to move to Mexico or some of the other lower-tariff jurisdictions? How have you navigated the whole morass of tariffs that now aren’t just on China, but the whole world?

Rick Woldenberg: I was at the company when we first began to move to China. We had a small handful of Chinese vendors when I joined the company in 1990. Shortly after that, we lost a big order. We had established a customer relationship, and then they took all our business away and gave it to someone else who was able to sell similar products for a much lower price.

For us at that time, if we wanted to grow, we had to join everybody who was developing a lower cost base. We had no choice if we wanted to survive — we had to find a cheaper way to make our products.

The reason China succeeded is that it has everything. They have an enormous pool of molding machines. They have engineers, roads, inspectors, ports, and toolmakers. They have everything you need in enormous supply, and it’s a giant fluid market where they fill in all the gaps. When you make your product in China, there’s really nothing you need that can’t be sourced locally.

Almost every other country has deficiencies, and some of those can be quite significant. You might not think about it too much, but transportation in India is terrible. It depends on the location of your factory, which sometimes can be random, and getting your product from there to the port can sometimes take a tremendous amount of time. They have weather problems too. We’ve had orders in India years ago, where, during the monsoons, the roads would wash out, and you waited six weeks to be able to move the product to port. Hopefully, some of those problems have been addressed by now.

The reason China won is that China had everything, and it was functioning really well. Also, it was the first country that we taught in the Asian basin to make products to US. expectations for quality, consistency, value, and finish. They understood and accepted what the US. market wanted. It wasn’t an argument. You didn’t have to justify it. They knew everybody wanted the same thing, and they set their standards to that.

They’re very good at what they do. Of course, we were always doing business with private companies, family businesses like us. These are folks who put their money on the line and risk their money. They were honest businesspeople competing in a hyper-competitive market, just like us. They were good partners and always have been. They were entrepreneurial, always looking for a way to be better.

Jordan Schneider: How does that compare with the alternatives in Vietnam, India or Mexico?

Rick Woldenberg: Well, you have a critical mass issue. These other markets are still building up the critical mass. There are still things missing. The things that are missing have to come across borders, which makes sourcing very difficult.

When you have a product that’s brought in finished, but the components have to cross borders to become part of it, that slows things down. It introduces new levels of taxation and risks. You’re introducing multiple countries’ rules on quality, shipping, and international relations. It’s all kinds of problems. You’re a lot better off if everything comes from one place. Again, a natural advantage to China.

Rule of Law and What Comes Next

Peter Harrell: When do you think you’re going to get your refund? Which obviously includes the why, but how long do you think it’s going to take to actually get back these now illegally collected tariffs?

Rick Woldenberg: Well, I’m not in the camp of people who are wringing their hands. From my perspective, it’s rather simple. The federal government overcollected its taxes. There is law that governs the return of overcollected taxes. We have a right to the enforcement of those laws.

Those laws are very often not even given much thought. People just assume that it will happen. After all, they took money that isn’t theirs. They’re not entitled to it. I believe that they just have to have an adult conversation with the two sides, come up with a process, and then the court’s job will really just be to oversee it and make sure it actually happens.

Frankly, if it were my job to hand out millions of refunds, it would be very difficult for me. But the federal government does this through the IRS all the time. They know how to do this. They can do it.

I believe that today the mandate was sent down from the Federal Circuit to the CIT. It’s now all in the CIT. CIT does this as part of their franchise, so they know how to do it. Frankly, I’m expecting the DOJ to fall in line because we should not forget the words of Lincoln: government of the people, by the people, for the people.

The DOJ is not a foreign party. The DOJ is us. We sent our neighbors to Washington, we pay them with our money to do those jobs, administering those responsibilities. We have our money. They don’t have our money. They are we, we are they. They took too much. They need to give it back. There are laws. They have to follow them.

Peter Harrell: I have to say, I completely agree with you, Rick. I’ve always found this argument that maybe the government wouldn’t have to give the tariffs back conceptually bizarre.

We would all agree that if the government came and announced it was doubling our income tax rate with no act of Congress, we’d be like, “Well, of course, we get our money back once the courts throw that out, right?” If the Treasury Department suddenly said, “I’m taxing you at 70%,” we’d all agree you get your money back. There’d be no debate at all.

This is really conceptually no different. It’s just another kind of tax. I actually looked it up the other day on the refund morass issue, and it was 120 million — or maybe 117 million — tax refunds that the IRS processed in 2024, the most recent year that they’ve put the data out on. This idea that they don’t do this or that it’s impossible logistically, I find hard to believe.

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Rick Woldenberg: It’s fearmongering and hand-wringing. I don’t take it too seriously. The laws protect us, and our case stands for the rule of law. I expect the court to get involved and force them to do this.

It really doesn’t matter what people’s personal opinion is on whether this is right, wrong, or indifferent. The Supreme Court has spoken. These taxes have been overcollected. There are laws — which are not controversial — that govern the return of overcollected taxes. They have to do it.

We’ve got to move away from a political cycle where political speech is dominating what is essentially a cut-and-dried governmental process.

Jordan Schneider: Can we come back to the decision to file the suit? We recently met at the Toy Fair. We’re walking around, and you guys weren’t the smallest booth, but you also weren’t the biggest. You also aren’t one of the biggest companies in the economy, where basically every single company in America was impacted in some way by the tariffs.

Why was it you and not Mattel or Apple or any of the other firms that probably had much easier access to the legal resources needed to file something like this?

Rick Woldenberg: I get asked that question a lot. It’s hard to answer why other people chose not to do this. Ironically, a lot of people were concerned about the cost. But from my perspective, cost was really not an issue — I hope my lawyers aren’t listening.

The reason is that the stated intent of this government was to have me pay these taxes forever. If you look at what that really means in the long run, it was not a hard decision to make.

I don’t know why other people made different choices. For me, I had something that I felt was important to protect. When I think about our business, we’re a mission-driven business, which is slightly different in nature from other kinds of businesses. We actually believe — rightly or wrongly — that if we didn’t exist, it would cause a little tear in the fabric of the universe. We just don’t think we’re easily substituted for.

If you really care about what you do, and it gives you meaning and a sense of purpose, you’ll stand up for that. There were personal aspects too. Our family has been a steward of this business for a long time, and the jobs that people had with our company meant a lot to them. You see a relationship between what you do, keeping your business healthy, and how your neighbors fare. In a purpose-driven business, you actually care about that stuff.

It’s much easier for me to say what was going through my mind than what was going through other people’s. Lots of different reasons have been held out as to why they did or didn’t take action. But it is true — and it’s a strange thing — that we are the only people who paid tariffs, were a victim of tariffs, and used our own money to sue. The other nine lawsuits were filed by governments, semi-governmental institutions, and interest groups with recruited plaintiffs. We put the money down.

Peter Harrell: I have to say, I admire you for it. I remember in Washington back in February, March, April of last year, I had done some rounds with some of the big trade associations and corporations, asking, “Are you guys going to sue?” I got into this because I’d been of the view from very early on that this was illegal, as a matter of law and principle. I was pro bono going around to see if anyone was going to sue. None of the big trade associations, none of the big corporations were willing to stand up and actually file suit.

It was great from my perspective when you guys decided to. As you know, there were also state governments and some impact litigators who brought small businesses into it. But it was striking to me how no one wanted to stand up and say all of this is illegal. Good on you for doing it.

Rick Woldenberg: Thank you. In a private business, you get to make these decisions yourself. I don’t need to worry about external factors if I don’t want to.

Frankly, we also had a clear vision that our lawsuit was not a political statement, and I didn’t allow it to become a political statement. We never took the view that it was us versus Mr. Trump. In fact, I’ve told people that we don’t need to have a view of the policy. We don’t consider ourselves pro-Trump or against Trump, and we try as best we can — sometimes it’s difficult — to not offer advice.

He has a hard job. I hope he does it well. We need him to be successful. But we’ve stayed away from doing things that we consider to be political. I feel as though we can take care of our own needs by simply pointing out that this was unlawful and sticking to that.

It’s possible that other folks didn’t see that this kind of case could be prosecuted without having a so-called bad guy on the other side. I don’t need to have an opinion about whether they’re bad or good. This is really about following the rules, which are the basis of the society that we depend on.

Jordan Schneider: Republicans buy sneakers as well as children’s toys, I hear. I do think there is something magical and remarkable that a small business can file suit and overturn the premier platform and policy instrument of the most powerful person on the planet. It makes me proud that the American system still has this in it. That was my big takeaway.

Rick Woldenberg: That is the American system, and one of the very important takeaways of the case is that in a rule-of-law system where everyone is equal under the law, you can win if you’re right — even if the other guy prints his own money and has thousands of lawyers that we actually pay for, not him. He has the power, he has the money, he has the elite status, but the law doesn’t care. The law makes us all equal.

We bet that the rule of law would remain supreme and that our position was correct on the law, which is something we were very confident of. This was reaffirming that.

The other thing our case illustrates, which is a little more elusive — it’s not really a legal point, but more about how we think about the communities we live in. We live in communities that most of us cherish, value, and would defend. The community could be where you live, but it could be whatever you define your community to be: your church, your pickleball league, your family — whatever you decide it is.

We all have a common benefit from these communities we value, but I’m not sure people spend enough time thinking about the common responsibility we have. What happens if you’re the only one in line, or you’re the last one in line with no one behind you? If everyone in the community agrees that we need to do something about this, but everyone also agrees it should be someone else — not them — what happens? What if every single person thinks that? You can find yourself in a pickle, and it can be a big problem.

I hope as people reflect on our case, they’ll give some thought to how that lands with them and what they think their shared responsibility is. It’s not for me to judge — it’s a very personal thing. It probably has to do with your family, your background, and your life experiences. But we’ll have better, more stable, more enduring communities if at least somebody stands up when somebody needs to stand up. If everyone thinks it should be someone else, sometimes it’s nobody, and that’s when bad things happen.

Peter Harrell: Obviously, the president has announced that he is using fallback authorities. He’s got these Section 122 tariffs at 10%, although he said he’s going to raise them to 15%, and then maybe develop more tariffs under other statutes behind that, since those tariffs expire at the end of July. Do you think you’ll be involved in another round of litigation, or do you think you’ve had enough of this so far?

Rick Woldenberg: I can tell you the President of the United States doesn’t have the constitutional authority to be a taxing body. When the President goes on TV and speaks about the taxes he intends to impose on me based on his personal preferences in an endless stream, that’s not right. This isn’t based on what I learned in law school, but what I learned in 8th grade.

How do we stop it is a different question. There are many different ways to go about that. One thing everyone should consider is who actually runs this country. The people who run this country are the voters. It’s all well and good for a member of the government to assert rights, but ultimately, we collectively hold our future in our hands.

If we don’t like this, if we think we’re being lied to, or if this is going to cause us to have fewer jobs, not more jobs, we have a solution. Every two years, we go into the voting booth, and we can actually take control.

There are several different ways we can resist this. The devil’s in the details. We won in the first case because the law was on our side. We have to carefully evaluate in each case how that’s going to play out. What’s the precedent? What’s the venue? These are careful things that must be thought through and should be seen in the context of an overall democratic process that ultimately is behind all of this.

Jordan Schneider: What did your employees think?

Rick Woldenberg: This has been a real shot in the arm. My impression in talking to lots of people — friends, family, and others — is that there’s an unfortunate rise in a sense of despondency in this country. There’s a growing lack of confidence in institutions we used to take for granted and in processes we used to take for granted. There’s even doubt growing in other people — can you trust these other people?

When we stood up and did something, aside from the fact that in the beginning some people thought Rick had lost his mind, the folks who work at this company are very proud. They are a small group of people who are closely associated with this win. They’re witnesses to history, and it’s a source of enormous pride.

We don’t have a whole lot of competition for standing up right now. It is a matter of pride, and it’s satisfying to me that we’ve touched as many people as we have. I’ve heard from a lot of people, many I don’t know. They send me letters, emails, and texts. It’s gratifying that if we’re going to leave our mark on the world, the mark we’re leaving is a positive one when it seems like people need to hear good news now.

Jordan Schneider: Do you care to share one or two of them?

Rick Woldenberg: They’re generally just heartfelt notes. People emphasize that they appreciate that we stood up. People also respect that it’s no slam dunk to sue in April and get a win at the Supreme Court in February. People were appreciative not only that we stood up, but that we made it happen.

When I say we made it happen, that is a large “we.” It’s certainly efforts from this company, but we had fantastic counsel. There were other plaintiffs, too. We were not alone, and they had counsel as well. Everybody who gave it the old college try and was involved, and certainly the esteemed other plaintiffs and counsel involved in our Supreme Court hearing, everyone should take a bow.

Everyone should claim victory and rejoice in that because we did it. It’s not an individual, it’s not me, it’s us, and we did it. Peter, that includes you as an author of an amicus brief. Everybody pitched in, and we drove it across the line collectively. We don’t have to divide up the spoils. Everyone can say, “I was part of that, I made a difference.” They should. It was a big win for all of us.

Jordan Schneider: Are we going to get a legal-themed line for 3-year-olds? Is this something on the horizon?

Rick Woldenberg: I hope not. I’m hoping that 3-year-olds can continue to learn through imaginative play. Imagining writing a brief or arguing in front of the Supreme Court — we’ll save that for later.

Jordan Schneider: Keep it to the 5s and 6s. Fair enough.

Rick Woldenberg: Absolutely. When career planning becomes more critical.

Peter Harrell: One of the small business plaintiffs in one of the other cases is a clothing company named Princess Awesome that makes brightly patterned kids’ clothing. My 9-year-old daughter loves them — it’s her favorite clothing company.

When I saw they had become a plaintiff a month or two after you filed, I wrote their customer support to say “good on you” and that I appreciated them filing suit. I got a nice note back. Maybe I should follow up and suggest they create a dress featuring Supreme Court justices that says “tariff-free” because of this case.

Rick Woldenberg: A friend of mine is one of the other plaintiffs in that case. Those folks have their hearts in the right place.

Sometimes I feel the issues we raised are marginalized because the companies that stepped up are small or medium-sized like ours — none of the big companies joined. It seems like it’s just the little guy’s problem, but I don’t agree with that.

After we won, companies that sued — Revlon, Barnes & Noble, Costco, FedEx — these are enormous companies whose refunds will be nine or even ten figures. This is really a problem affecting every company that crosses borders. In a world with global trade, that’s an awful lot of people and jobs.

The fact that the plaintiff companies were all small brands is an oddity of this case, but the issues are enormous. James Madison was very concerned about the executive being able to impose taxes. No kings.

Jordan Schneider: It is remarkable that all these firms are now set to gain literal billions of dollars back in taxes, but they were willing to entrust the handling of this case to smaller companies. No one thought the cost-benefit calculus was worth doing it themselves.

Rick Woldenberg: It’s the most American thing in the world to seek a tax refund.

Peter Harrell: They should get their money back. I feel like they should pay the lead plaintiffs a finder’s fee on this, but that’s not how the court system works.

Rick Woldenberg: I’d be happy with reimbursement of our expenses. That would be fine.

Jordan Schneider: Rick, congratulations. I hope you get yourself a championship belt, or at the very least, your expenses refunded. This was a pleasure. Thank you so much for being a part of ChinaTalk.

Rick Woldenberg: Thank you for having me on. This has been a great adventure.

To discuss nuclear weapons and AI, we’re joined by Pranay Vaddi, former senior director for arms control, disarmament, and nonproliferation on the NSC. He’s now in a new policy role at Sandia Labs and at MIT. Chris McGuire also joins us. Before working on chips, Chris served as State Department’s lead subject matter expert on U.S.-Russia nuclear weapons and arms control policy.

The first part of our conversation covers:

• How the US and China agreed AI should never be allowed to decide to use nuclear weapons and why that’s only the starting point

• Where AI could enter (and is starting to creep into) nuclear command, control, and early warning systems

• Whether better data and decision support actually reduce nuclear risk or just make escalation faster and more opaque

• How much automation is too much, from targeting systems to fully autonomous weapons

• What happens when AI systems outperform humans in domains where we’ve insisted on “human in the loop”

• Future AI capabilities that could make the oceans transparent, and what that would mean for the survivability of nuclear submarines

Plus, why AI systems in war game simulations are more trigger-happy than humans, why the US doesn’t need an automated nuclear chain of command — but Russia does, and what “slightly less insane” nuclear decision-making might look like.

Jordan Schneider: Congratulations, you guys are on the first-ever edition of WarTalk.

Pranay Vaddi: Thanks. Let’s hope we live up to it. I feel like we’re on the frontier here.

Chris McGuire: We started doing arms control and we ended on WarTalk. I don’t know what happened to us, Pranay.

Pranay Vaddi: I know what happened. We utterly failed in our previous jobs.

Jordan Schneider: So, we have this agreement between the US and China to not use AI to make decisions on whether to nuke each other, which when it bubbled up over the past few years has a long intellectual history of discussions about how to do command and control — who’s in charge of sending the nukes and, f you’re in a war or if the president dies or someone gets incapacitated, where does that decision end up falling to?

Pranay, I’d love to have you kick us off and tie this current debate about how AI should interact with nuclear weapons to the broader 20th-century history of who gets to decide when the nukes are used.

Pranay Vaddi: Sure, Jordan. As you mentioned, I’ve taken on a new role at Sandia National Labs. I’m here in my personal capacity, not representing Sandia policy, Department of Energy policy, or US government policy.

Chris and I have spent probably more time thinking about nuclear weapons issues than we have AI issues, though Chris made the jump a lot earlier than I did into the emerging tech space, while I continue to work in what is probably a more stagnant field.

Jordan Schneider: Not anymore. Come on. This is boom time.

Pranay Vaddi: This is great promo for WarTalk.

Keeping Humans in Control

But, starting at the beginning, people have started to talk in the past decade about where artificial intelligence and nuclear weapons intersect. It’s by no means a new issue. We can talk about the Soviet Dead Hand system, or Perimeter as it’s referred to more currently. We can talk about different Hollywood takes on AI using nuclear weapons — Terminator 2 Skynet with Linda Hamilton grabbing the fence while Los Angeles detonates around her, and WarGames with Matthew Broderick. There’s actually quite a bit of literature out there, as well as some policy-relevant occurrences throughout history.

Chris and I were thinking about this in our former roles in the last administration. In general, people who work on nuclear weapons issues are saying, “We have a lot of other problems. Why do we need to talk about artificial intelligence within our nuclear policy for the first time?”

Those problems are practical. How many more nuclear weapons does the US need? There are big-ticket nuclear weapons modernization programs that are getting delayed or costing more money. People are worried about geopolitical factors related to the number or types of nuclear weapons adversaries have. China wants to acquire more territory. Russia wants to coerce a NATO state or a partner in Europe. These factors are putting stresses on US security guarantees that date back decades and were always tied to nuclear weapons issues.

When you throw AI into the mix — which was unclear to most nuclear policy people in terms of why it’s a game changer, how it’d be applied, and what it really changes — it adds another dimension to the nuclear policy debate. Does it make nuclear weapons thinkers consider offensive advantages or defensive advantages? This complexity is why it wasn’t represented in official documents that much.

Fast forward to the Biden administration and the 2022 Nuclear Posture Review, which is probably the first official government strategy document that really goes into some detail. Chris was more involved in it at the time and can expand on it. The people drafting the review and the leadership that approved it wanted to make sure there was language about artificial intelligence as it relates to nuclear policy.

At this point, think tank and academic debate circles had really started to talk about AI for the past few years. In 2022, a sentence was included in the Nuclear Posture Review, specifically in a paragraph focused on the risks of unintended nuclear escalation — what if a nuclear weapon gets used by accident? What controls are in place? This is where artificial intelligence enters the scene as a matter of government nuclear policymaking.

The sentence reads: “In all cases, the United States will maintain a human in the loop for all actions critical to informing and executing decisions by the President to initiate and terminate nuclear weapons employment.”

Here you have a staple for US policy — official government policy — which, at least among the five formal nuclear weapons states, was a first. Later that year, the United Kingdom and France adopted versions of this commitment as well.

The United States worked for a couple of years to have a similar statement made by the People’s Republic of China, culminating in 2024 with the Biden and Xi joint statement about keeping a human in the loop for nuclear weapons use. It was a much simpler, less expansive statement. But in the annals of US and China arms control diplomacy, you can call it a win when you get the same sentence on two readouts of a meeting. I wouldn’t call it an agreement, but at least we see that both countries share the same intent.

Now, much of the conversation I’ve witnessed outside of government focuses on how to make that statement or those shared statements into something real. What do you need to do to ensure that commitment will be lived up to by either country? You really get into hard stuff — understanding how AI is being integrated into each country’s militaries, which is obviously a well-kept secret.

Chris, what did I leave out?

Chris McGuire: A little backstory — the National Security Commission on AI, led by Eric Schmidt, published its final report in 2021, recommending restrictions on AI for nuclear employment decision-making.

Those specific words are important. People sometimes garble this and say “no AI in NC3,” which is profoundly wrong. AI has to be throughout our NC3 complex. It’s going to be hugely beneficial to our early warning systems and detection capabilities. The issue is really in the employment decision-making. Pressing the button must stay with the president.

Here’s some inside baseball. When I was at the White House in mid-2021, I suggested we state that we won’t use AI for nuclear decision-making. I remember DoD folks reacting like, “Okay, that’s weird. Why would anyone do that?” It slipped into the review almost because they had bigger fish to fry. It shows how quickly this debate has moved. Today, it’s a high-level risk that everyone thinks about daily.

It wasn’t that long ago. I’m thankful we have that statement. We built into it to also get commitments from the Chinese there, which is rare — they’re rarely willing to say anything on nuclear policy.

It shows how quickly this has really changed over the last five years. This kind of very high-level risk was not something seriously thought about in a lot of policy circles.

Jordan Schneider: I don’t know how much better this makes me feel that a human being with white blood cells, as opposed to a computer, is going to be making this final decision.

Chris assigned me Command and Control: Nuclear Weapons, the Damascus Accident, and the Illusion of Safety by Eric Schlosser. One of the things that really struck me was the command and control problem. Say the Soviet Union nukes Washington, D.C., and suddenly the Pentagon doesn’t exist. The President’s dead, the Vice President’s dead. You go down the list of succession, and we’re down to person number 25, who probably doesn’t have a cell phone because it’s 1954.

Then you have this question — how far do you delegate the authority? Is it to a 50-year-old in Nebraska? Is it to a 35-year-old in West Germany, Italy, or Turkey?

My takeaway from that book was that once you get to the point where either the nukes are flying, and you have stressed presidents with five minutes to decide which SIOP to execute, or we’re down to some colonel somewhere, we’re already in a terrible position. If we’re in that moment and it’s AI making decisions, we seem pretty fucked anyway.

The best case for this might be that if AI reduces the risk of something going awry during peacetime or in a heightened warning phase, rather than fully midway through a nuclear holocaust. Thoughts, Pranay?

Pranay Vaddi: Look, I agree nuclear holocaust is bad, so whatever we can do to stop that from happening is great. Schlosser’s book is excellent. He highlights many historical examples that continue to animate discussions today about the risk of inadvertent nuclear war. Now you throw AI into the mix, and it becomes even more frightening.

AI potentially introduces some new failure modes. Some of the utility for artificial intelligence in the nuclear policy world comes from using AI to better support nuclear use decision-making. Can you more rapidly detect an incoming nuclear attack? Maybe a president would have more time to make a more prudent decision with more information available.

You could also have AI recommend options. We think these targets aren’t as important for the political objective you have. We think these targets have already been destroyed by other means. General nuclear war is going to be a pretty fuzzy picture. How are human beings supposed to keep track of all of that in real time while the president is being forced to make decisions on a minute-by-minute or hour-by-hour basis? We’re talking about some pretty hairy stuff.

Part of the challenge is that, as somebody who works in nuclear policy, I can’t hang with Chris, who works more on the emerging technology and artificial intelligence side, in a conversation about what AI can and can’t do for my area of work. That’s largely true of many people who are now focused on AI in the nuclear policy and nonproliferation community.

What we do know is that since some of those events highlighted in Command and Control, the US has actually changed the way it tries to mitigate those types of accidents. For example, we now use different types of warhead designs or explosive designs to ensure warheads don’t accidentally explode. He cites an example about the Titan II ICBM exploding in a silo and throwing a warhead. We try to make sure that kind of thing can’t happen anymore. We don’t have liquid-fueled ICBMs or warheads with sensitive high explosives to the extent we once did.

There’s been much more emphasis in recent decades on positive controls and negative controls. You never want a nuclear weapon to go off when it’s not authorized. You always want it to work when you actually want it to work. This has led to many technological and design elements in nuclear weapons that all nuclear-weapon states now try to employ.

This safety culture has really increased the reliability of our system. We’re not going to have the types of false alarms and accidents that Eric worried about. I’m not saying it’s impossible, but it’s much harder than it used to be.

AI potentially introduces some new failure modes. Some recommendations from organizations like the Future of Life Institute, which have been pushing on how to manage AI risks in nuclear policy decision-making, have focused on how AI is integrated into NC3. Will there be transparency? Will there be reliability?

AI in Nuclear Command and Control (NC3)

Jordan Schneider: Define NC3.

Pranay Vaddi: Nuclear Command and Control. This is the suite of systems that forms an architecture to enable nuclear decision-making. It includes your communications, your ability to communicate with nuclear forces if you’re the president, your ability to command and direct the nuclear forces, have secure communications, and issue authorized orders. You can then control those forces as well, including their deployment. You need to bring them back home if you don’t want to use them.

This entire infrastructure includes not just the people in the chain of command — the people advising the president and supporting any decision-making — but also all the technical means by which you can manage the nuclear forces.

Some of the utility for artificial intelligence in the nuclear policy world comes from using AI to better support nuclear use decision-making. Can you more rapidly detect an incoming nuclear attack? Maybe a president would have more time to make a more prudent decision with more information available about whether he should attack now, ride out that enemy attack that’s incoming, or do something else.

There’s rapid intelligence and battle domain awareness and force analysis fusion that can happen. Even if it takes people just a few minutes longer, those few minutes matter a lot. You might be able to have some frontier model integrated into the NC3 system that does that much more quickly and, frankly, maybe more accurately.

You could also have AI recommend options. We think these targets aren’t as important for the political objective you have. We think these targets have already been destroyed by other means. The type of conflict you were talking about — a general nuclear war — is going to be a pretty fuzzy picture. You’re talking about needing to worry about warhead fratricide. You’re talking about targets that may not have been hit but may have been destroyed because some other target next to them got hit. How are human beings supposed to keep track of all of that in real time while the president is being forced to make decisions on a minute-by-minute or hour-by-hour basis? We’re talking about some pretty hairy stuff.

The other side of that is, of course, if all these nukes are flying around, does it really matter? Does this level of specificity matter? Jordan and I, before we started recording, were talking about this. We stipulated the insanity of a general nuclear war, but at least in the United States, we’ve always thought about how to make it slightly less insane. Or how can you actually achieve some advantage so that you’re not a completely destroyed society at the end of that, but you’re a mostly destroyed society?

These are the types of debates that are very Strangelovian, but you can imagine that little bit of accuracy advantage or decision-making advantage that AI can provide really could be incentivized in a US NC3 system, maybe less so in other nuclear weapons states.

Before we move on, just for all the kids out there, the reason you have the internet is because of this very question. The whole problem of command and control — where military bases couldn’t communicate with each other — led various scientists in places like Sandia to come up with distributed ways to communicate. They developed networks where some parts could fail, and the system would still be okay.

Pranay Vaddi: Some of us remember getting it in our house for the first time.

Chris McGuire: One thing I’d say about what Pranay said — it’s really the question of nuclear use being a fundamental barrier that we as a species haven’t crossed since 1945. Once you initiate that decision, you’re potentially opening a Pandora’s box to a whole other host of policy outcomes that we may or may not want. That decision has to be made by a human.

Obviously, once nuclear weapons start flying either way, all bets are off. I’m sure decisions are delegated. I’m sure AI is probably making a ton of decisions, potentially even including employment decisions, but not the initial one.

Jordan Schneider: How good are tactical nukes at clearing mines in the water?

Pranay Vaddi: I don’t know. I don’t think the US has any, but maybe we could ask the Russians to help. They have a much more diverse array of tactical nuclear weapons. There have been people like Sergey Karaganov in the Russian academic space who’ve been saying, “What we really need to do is set off a nuclear weapon so everyone remembers how terrible nuclear weapons are, and then everyone will listen to us.” I don’t know, Jordan, do you want to write a letter? I could help you draft one if you’d like.

Jordan Schneider: It could go the other way. You could just do a little Davy Crockett one in the Strait of Hormuz, and everyone’s like, “Oh, this is not that bad. What are you guys worried about?”

Pranay Vaddi: Some of your new listeners to WarTalk will really like the excursion we’re on now.

Jordan Schneider: Let’s come back. Pranay, you had this long list of potential AI use cases when it comes to targeting, force planning, and planning. We have this big debate now about China rearming, and there’s this question of nuclear modernization. How many more weapons does the US need? What type of them? Where do you spend the money? Is there a world where these AI tools get you to a confidence level where you can feel like you can spend less money to achieve the same amount of deterrence?

Pranay Vaddi: That’s a really good question. I’m considering the strain the US is under, where it needs to have a nuclear force sufficient to do what it needs to do. In this case, maybe deter two adversaries at once, support multiple allies in far-off places in the world at once, etc. There’s going to be a premium on cost efficiency here because the US is not going to be able to just double its arsenal. I don’t think that would be a prudent expenditure of resources anyway. It takes a long time to do that.

Making nuclear weapons is extremely expensive and time-consuming. Five years later, it’s even more expensive and more time-consuming.

Finding any efficiencies where, let’s say, you have to use, threaten to use, or use fewer nuclear weapons to achieve a certain objective than you may have before you brought AI into your NC3 system could be worth it. You could imagine a scenario in which, if the United States has not achieved the weapons effects they needed against a certain type of target, they may need to use additional weapons.

Let’s say the United States is trying to destroy a mobile missile launcher that’s in the forest somewhere. These things can move around, and the intelligence information you may have may be slightly dated. If the United States is trying to destroy that using a nuclear weapon and misses or isn’t sure, it might need to use two or three, because part of what the United States likes to do in its nuclear strategy is threaten an adversary’s nuclear forces.

Let’s say you do it more efficiently and use a loitering conventional capability that’s able to action very quickly upon an execute order being given and is already in theater and can do it more quickly than any of the US nuclear forces — guess what? That’s a target that you don’t need to have a nuclear weapon reserved for anymore.

This could lead to not just less strain on the nuclear force as it stands today, but in the future, if the US finds more efficiencies, there might even be a future where you can have fewer nuclear forces. That would lead to potential benefits in arms control down the road.

If the president says, “Okay, let’s go on this particular option because I want to be able to destroy China’s nuclear forces in this hypothetical conflict,” and if you have a bunch of systems that are essentially autonomous and already in the region, and that employment order has been given, you can imagine a scenario in which these systems are then going to autonomously go and hit the targets they’re supposed to if they’re already in theater.

You may not have the president approving the strike of each of those types of systems on a target. He’s just given this overall blanket approval: “I approve option 1A, and that’s what we’re going to try to do.”

There’s an interesting question for nuclear policymakers. Yes, you want the president or his successor making the original decision to begin nuclear employment. But do you need that decision applied to every system that has some autonomous capability? Of course, the US does not have this in any of its nuclear weapons delivery systems now. But if you’re thinking 30 years down the road, maybe people will see the benefits of that in the future.

Just to bring this back to the Skynet conversation we really want to have — as we said, it gets pretty murky.

Chris McGuire: It’s very clear that the initial decision requires human control. Beyond that, however, the details of the conflict become complex, and there will inevitably be delegated decisions in ambiguous situations.

Even setting aside nuclear use, fully autonomous weapons — let’s assume without nuclear capabilities — present a murky and complicated area. We’re seeing this play out in real time with recent news stories about Anthropic’s position and negotiations with the DoD.

Notably, Anthropic’s position isn’t “no fully autonomous weapons.” Instead, they argue that the technology isn’t ready for it right now. This reflects a recognition that we will probably have — and need — fully autonomous weapons at some point. While we obviously want them to be secure and reliable, simply saying “no fully autonomous weapons” is probably not a militarily viable posture. This is precisely why the US has opposed bans on killer robots, proposed alternative frameworks for allies, and why DoD has Directive 3000.09 and Anthropic is taking their current position. The question then becomes — is there a fundamental difference when it comes to nuclear use of autonomous systems? Is that a red line?

It might be. The added value of having a fully autonomous system in theater — as opposed to ICBMs or manned systems — might be strategically marginal enough, particularly since once we enter the nuclear use scenario, all bets are off anyway. You could argue that the normative value of prohibiting fully autonomous nuclear delivery systems is greater than any strategic benefit they could confer. I can see that argument.

However, I can also see how it’s challenging because the fully autonomous weapons debate is inherently murky, making red lines difficult to establish. I would probably be comfortable — right now and for the foreseeable future — having a bright line saying we don’t want fully autonomous nuclear weapon systems.

There’s a reason the US has expressed concern about some of our competitors’ or adversaries’ unmanned weapon systems. The US has long talked about the Russians’ Poseidon system, which raises not only strategic and arms control compliance concerns but also technical concerns about accidental use, risk, and potential escalation.

My broader take is that everything here is murky, but for the foreseeable future, this might be another bright line in a domain with very few bright lines.

When I was with the AI Commission and at the White House, we spent considerable time thinking about this. We have the nuclear employment decision red line — that’s something we want to ensure remains in human hands. But what comes after that? What else should we definitively say must remain under human control?

There isn’t anything really clear because of where the technology is heading and the inevitability of increased automation in weapon systems. The dominance you’ll gain from increased automation creates reasonable discomfort within DoD about drawing red lines anywhere else.

The answer is that we need to ensure our systems are really secure, safe, reliable, and meet our intent. We also need to develop some kind of global architecture that promotes other countries using similar standards. If other countries use systems prone to accidents, that’s very bad for us. This is a difficult challenge without clear solutions, though it’s obviously in our interest.

Pranay Vaddi: The position Chris has articulated regarding the subsidiary questions on how we specify the role of AI — or its absence — in relation to nuclear weapons aligns closely with the current administration’s stance. In one of the recent articles about the Anthropic issue, a Pentagon spokesperson stated there’s been no change to the Department of War’s position that a human must remain in the loop for any decision to employ nuclear weapons. He confirmed that no policy considerations are underway to place that decision in AI’s hands.

Congress addressed this issue in the National Defense Authorization Act. They promoted AI machine learning in decision support roles, such as sensor and intel fusion. They directed the department to ensure that integrating AI doesn’t introduce additional risks to strategic capabilities. They also restated the necessity of human safeguards and keeping a human in the loop.

Congress even referenced requiring positive human actions in executing decisions related to nuclear employment. This suggests more than just the president giving an order to deploy our nuclear force. It implies that whenever there’s a decision — potentially even one delegated to a theater commander — that commander needs to be in the loop for execution decisions. For instance, if we lived in a world where the US had numerous theater nuclear forces requiring more battlefield-oriented decisions, each commander would need to be involved.

This approach goes beyond the language in the Nuclear Posture Review, the P3 statement, and the US-China joint statement. It points toward where Chris is leading the discussion — determining the appropriate level of automation in nuclear decision-making.

We no longer have Davy Crocketts to use in the Strait of Hormuz. Perhaps in a decade, the US will have more theater nuclear options like that, as multiple congressional commissions and administrations have identified this as a capability gap against Russia and, to some extent, China. This is where tactical execution decisions and AI collide. How much authority should be delegated solely to humans? How much should we rely on AI’s rapid analysis of how the battle space is developing? That’s where the truly compelling conversation is heading.

When Machines Start Making Better Decisions Than Humans

Jordan Schneider: My sense is that the reason we’re still having these human-in-the-loop versus human-on-the-loop discussions is because the technology isn’t there yet to just press a button and have 1,000 drones do the thing. Once that does exist, there is, as Chris said, a very strong competitive logic to just having your drone fleet go over a country and figure out where all the ballistic missile launchers are and shoot them.

I’m with you there on it being hard to imagine a world where there are really strong legal restrictions or ones that stick around a week into a conflict. But on this continuing to have humans be part of not just the president deciding it, but also the theater commander and then the two guys in the silo — I wonder to what extent, Pranay, this is just hope and reasoning from some of these Cold War case studies where you had human beings who could have chosen to interpret something more dangerously or less dangerously.

There’s something nice about us all having a soul and not wanting to kill millions of people. We’re a little more comfortable knowing we have a number of various American and Soviet military personnel deciding to chill out for an hour. Continuing to preserve that in the future is just like having people in these jobs who aren’t super excited to do the thing.

Pranay Vaddi: No, that’s right. This is maybe the dovish and inspiring portion of WarTalk, but there are a couple of fundamentals that I haven’t seen evidence AI is going to change.

One is that people in positions of power — whether it was in the Soviet system, the US president, or Mao in China when the Chinese first tested nuclear weapons and thought about the use cases during the Sino-Soviet split — really don’t want to use nuclear weapons. There are very strong incentives to avoid using nuclear weapons in a conflict.

You’re seeing a lot of the development of drone technology, one-way attack drones, and automation or automation-light being used, whether in the Ukraine-Russia conflict — and we’ve seen the rapid evolution of military technology used there — or in the current conflict in the Middle East. Countries would rather trend towards these conventional, non-nuclear, attrition-based warfare models if possible, because the consequences of going in the other direction are so terrible.

You’re right to point out that we’ve seen these heroic figures throughout Cold War storytelling about near accidents. All countries that have nuclear weapons have really worked hard to mitigate the types of risks presented by those events. You’re not just reliant on somebody saying, “Not today, I’m not turning my key because I think this is a fake.” You have an entire system and architecture that makes sure no one person is really put in that position.

That’s why when we talk about AI for decision support purposes, you don’t want the information that gets to the president to be bad information. You want him or her to have the best possible information available before making such a consequential decision. Our system has always been looking to optimize that — maximizing decision time and maximizing the integrity of the information a president has.

Jordan Schneider: But here’s my question, Pranay. Waymos are better at driving than humans, and maybe they’ll make some mistakes that humans wouldn’t make. But at this point, I would take a Waymo driver 10 times out of 10 versus my replacement-level human driver.

Now, the human being making the targeting decisions or the human being making the intelligence judgment about what’s happening in the Politburo or the Kremlin — clearly we’re not there in 2026. But AI will do tons of things better than humans in 5 or 10 years. Of course, it depends on legislation, because you wouldn’t have the competitive pressures that you would have in a corporate marketplace.

It’s hard for me to imagine that a lot of this intelligence gathering, collection, synthesis, and targeting work won’t just have agents do a better, more thoughtful, more thorough job than your sleep-deprived 25-year-old.

Pranay Vaddi: That’s probably right. But nuclear weapons use is inherently a political decision. Until we see these agents be able to deal with that — and in large part that takes away the cold, Strangelovian analysis of “Well, Mr. President, if we are able to execute our plan and take out these targets, we think the enemy will have no choice but surrender.” And then he’s not thinking about the political fallout, the willingness of the people in the other country to fight on.

These are all behavioral and psychological calculations that could be analyzed, and maybe AI can get pretty good at doing that. But when it comes to the decision-making that will take place, it’s going to be a president’s assessment of how this all comes together from a political standpoint, both geopolitically and in domestic politics.

Our system was always designed for the president to have to make that fateful decision and for it to be essentially a human decision — one that incorporates the president’s own experiences, thoughts, feelings, you name it. It’s not just the product of cold analysis. Otherwise, we could just feed a nuclear war plan into a computer and let the computer do all the stuff. We could have done that a while ago, really, without AI.

Jordan Schneider: The Iran strike is a great case study for this. A computer can tell you with 97% certainty that if you bomb this thing at this time, you’ll kill the Supreme Leader and all of his friends. But then what? AI isn’t really going to be able to predict with a high degree of certainty who’s going to be the next leader, whether there’s going to be civil unrest, or if that unrest will be quelled or not.

Pranay Vaddi: If you ask it, it’ll probably give you semi-intelligent ideas. But Chris and I both spent a ton of time doing tiger teams and playbooks to do scenario-based planning. That was a very human-intensive effort. You can imagine your starting point with AI might not be so bad, but you ultimately bring people in because these are people making decisions, not just in our country, but in adversarial countries where you might be engaging in this conflict.

Chris McGuire: It’s interesting that recent studies have shown that in war games, AI is substantially more prone to resorting to nuclear weapons use than humans. Obviously, this reflects the current state of AI technology and could change in the future, particularly as models improve and better reflect human behavior and intent — given that human intent presumably isn’t to always resort to nuclear weapons use.

Jordan Schneider: But when people play war games, don’t they always want to use the nukes? Isn’t that what happens on the last day? It’s like, “Okay, I guess we’ll just use the nuke.”

Pranay Vaddi: These scenarios are sometimes contrived. It depends on what you want your war game to test.

If you want your war game to test the likelihood that an agent will use nuclear weapons, as Chris is outlining, that’s very different from testing how easy it is to restore deterrence and achieve peace after nuclear use. In the latter scenario, you actually need the game countries to use nuclear weapons first. Then you can test how to reduce or limit escalation from there. It’s both yes and no, and it also depends on who’s playing. Some people just like to pretend to use nukes.

Chris McGuire: It’s not to say the system is inherently prone to nuclear use, but given the gravity of the risk and the relatively minimal cost of having the president make that initial decision, the current approach makes sense. The cost isn’t that high — yes, it will be a very stressful few minutes, but the system is well set up to handle it. There’s redundancy even in the event of a decapitation strike — we’ve planned extensively for that.

To remove human decision-making entirely adds substantial risk for minimal benefit. If you consider why other countries have automated decision systems — really only one does — it’s not because they see some massive strategic advantage. The Russians don’t think, “Oh, there’s a dead hand gap, and that’s why we need our own dead hand.” No, it’s because they don’t trust their people to use the weapon and because they don’t have as professional a military as we do.

We generally have a high degree of confidence that if the president issues a nuclear use order, our people will follow it. That’s why they train extensively for this scenario. Therefore, the utility of automating the chain of command, even from the top, is much less for us.

In their system, there are questions about reliability, particularly in the event of a decapitation strike where all bets are off. For them, having an automated system might actually be preferable. But these are very different circumstances.

Cyber Risks and Losing the Ocean

Pranay Vaddi: You highlighted one risk, Jordan, about the decision support space, which we haven’t spent a ton of time talking about. I would recommend people read the new Texas National Security Review roundtable. Our former colleague Mike Horowitz and a bunch of other scholars contributed to it — people should take a look at that. It addresses AI and strategic stability or nuclear deterrence issues.

One of the concerns expressed outside of government is that if you bring more AI agents into the decision-making and decision analysis and support process for NC3, don’t you create new areas of potential cyber vulnerability? Adversaries could potentially plant deepfakes or fake information into the decision-making process in ways they haven’t before.

That’s a different flavor of an existing problem — cyber vulnerabilities in NC3. This has been highlighted in the scholarly community and perhaps focused on a little too much, given the limited way we’re talking about artificial intelligence slowly crawling into the nuclear decision support space.

Chris McGuire: The misinformation problem we face with AI cuts across the board. Everyone wants to apply it to their pet issue, but the fundamentals are actually pretty similar. It’s actually pretty unclear how this is going to play out.

First of all, you can use AI to check whether something is made by AI and whether it’s misinformation. Even just go on Twitter right now — it’s interesting. There’s a bunch of misinformation, but even Grok will generally identify at least a big chunk of things that are clearly false very quickly. It could cut a bunch of different ways. I don’t see a lot of applications in the nuclear space that are fundamentally unique and different in my mind.

Pranay Vaddi: The other issue that’s been highlighted is how AI interacts with nuclear deterrence — whether it “turns the oceans transparent.” If your nuclear platforms and your safe second strike are based on ballistic missile submarines, and adversary countries are able to crunch data in a way — coming from satellites, undersea sensors, you name it — that increases risk for ballistic missile submarines. That could be game-changing over time.

I don’t think that’s close to happening. The question is how you can use artificial intelligence in a defensive mode to prevent that type of early detection from happening. To me, there’s probably going to be a significant undersea competition related to AI integration that impacts nuclear deterrence.

If you’re the US. and you put a large, substantial portion of your nuclear forces on submarines because you’re the best at undersea quieting right now, you could envision that even a 10% increase in risk there might change how the US. thinks about deploying its nuclear forces in the future.

Chris McGuire: I am profoundly worried about this. It seems infeasible to me that we’re going to be able to hide a ship that is hundreds of feet long and weighs millions of tons anywhere in the world, given the technical detection capabilities that are going to become available. The whole advantage of AI is being able to parse the signal from the noise, and you’re going to need much less signal.

Whether it’s undersea detection or space-based surveillance, the idea that we can hide these massive things in the ocean with the extremely advanced technical detection capabilities coming online is just something we can’t bet on in the next 5 to 10 years, let alone the next 50.

Does that mean we should scrap the Columbia-class submarine? No, I don’t think so because it’s just too important. But we have to plan for the eventuality that it might not be the invulnerable second-strike capability that we think it is. That’s really scary when you’re planning 30 to 50-year procurement decisions that cost hundreds of billions or trillions of dollars. If there really is a sea change here — pun not intended — then we need to posture ourselves accordingly.

Pranay Vaddi: In calmer times, you could imagine countries coming together to say, “Hey, we should try to avoid risks to our stable second strike. We can pursue advantages and compete elsewhere, but for SSBNs, we don’t want to do that.”

The problem for the US is that, given our nuclear strategy, we want countries to have stable second-strike capabilities. But if push came to shove and we entered the type of nuclear war that Jordan outlined earlier in the podcast, and the US is trying to attack adversary nuclear forces, then you actually want to have those advantages in detection.

The US is probably pretty good at that — likely leaps and bounds ahead of other countries. But if you think about the benefits that Chris just outlined of integrating AI into creating those risks for undersea platforms, then the US would not want to forswear that capability. They’d want to keep pace or be better at it than other countries.

To me, that could fundamentally change how we’ve thought about stable nuclear deterrence, MAD, or whatever you want to call it, since the end of the Cold War. Maybe it’s not here now, but I don’t see why it wouldn’t show up on our doorstep as we think about these issues in the coming years.

Dear Mr. Secretary,

On Friday you told reporters: “The only thing prohibiting transit in the straits right now is Iran shooting at shipping.” Fifteen days in, and the best we’ve got is the President asking the UK, France and even China to send warships. That’s not MAGA. That’s weakness.

I have a solution that doesn’t require a single phone call to Xi. A solution that only President Trump could pull off, because only he has the vision, and the arsenal, to do it.

We nuke us a canal.

Plowshare 1.0

America has dared to solve problems with nukes before. In 1957, the Atomic Energy Commission launched Project Plowshare. Named after the Bible. Isaiah. “They shall beat their swords into plowshares.” I know you’re more of a swords man, but plowshares are lethal too. Especially when your plowshare is a thermonuclear device.

The guy behind it was Edward Teller, father of the hydrogen bomb and Princeton man (before that meant woke).1 The Atlantic-Pacific Interoceanic Canal Study Commission spent years planning to nuke a sea-level canal through Colombia. They were “confident that someday nuclear explosions will be used in a wide variety of massive earth-moving projects,” but some hippies got worried about radiated milk and killed their momentum. The time to cash in on Teller’s vision is now.

The Plan

Instead of fighting over a 21-mile-wide bottleneck forever, we cut a new channel through friendly territory. A dozen thermonuclear detonations and you’ve got a waterway wider than the Panama Canal, deeper than the Suez, and safe from Iranian attacks.2

The Canal Commission estimated you could nuke a canal for $5 billion. You know what else costs $5 billion? A few days of this war. It pays for itself before the fallout settles.

See below for the CONOP I threw together in Gotham. Or click the link to nuke your own.

Preempting the Hand-Wringers

Now, I know what the woke deep state is going to say, and I want to save you the trouble of listening to them.

“The Comprehensive Nuclear-Test-Ban Treaty?” Never ratified it. Even if we did, who cares. Next.

“The environmental impact?” Mr. Secretary, Iranian oil is leaking everywhere. Tankers are on fire near Fujairah. This approach is constructive destruction.

“Radiation?” Radiation is the most overblown left-wing conspiracy since climate change. The Plowshare’s 1962 underground Sedan test fallout reached South Dakota in 1962 and South Dakota is fine. Went for Trump by thirty points. Plus, the residual glow keeps Iran from trying anything funny near the new channel.

The Trump Canal

Your boss is a builder. Trump doesn’t want to play nice with a coalition of countries he hates to patrol the Strait of Hormuz. He wants to cut a ribbon and watch the chyron on Fox. “TRUMP CANAL OPENS — LARGEST IN HUMAN HISTORY.” Mr. Secretary, give him that chyron and you win the war and keep your job. We can even tariff the tankers.

My DMs are open.

The views expressed above do not necessarily represent those of anyone with brain cells.

Update: Newt approved.

1

From a cabinet meeting with JFK in 1960:

2

Might end up being more than a dozen but hey who’s counting. From Kaufman’s Project Plowshare (2015).

Two weeks into the US-Iran war, CENTCOM has struck 6,000 targets, Hormuz is closed, oil is at $100 a barrel, the regime hasn’t fallen, and 400 kilograms of highly enriched uranium sit somewhere under rubble.

Shashank Joshi of The Economist, , and drop in to Second Breakfast for week two of the Iran war.

We discuss…

• Why CENTCOM’s 6,000-target tally sounds like a Vietnam body count

• The staggering failure to prepare for mine and drone countermeasures for the one strait CENTCOM exists to keep open

• The prospect of a special forces raid to seize Iran’s HEU

• How AI targeting machines like Maven can generate industrial-scale target banks without a theory of victory

Listen now on your favorite podcast app.

Hegseth: “The only thing prohibiting transit in the straits right now is Iran shooting at shipping. It is open for transit should Iran not do that.”

No Save Point

Shashank Joshi: The beaches of Normandy are open for full transit. The only thing stopping them is if the Germans would just stop shooting at us, the beaches would be fully open again.

I had a vision of Churchill declaring the Dardanelles to be completely fine, were it not for the Ottomans firing at it.

Justin: That’s pretty close to what Churchill actually said about the Dardanelles. “If they would just push the ships through, we would be in Istanbul.”

Shashank: Just give it a go. What could go wrong?

Tony Stark: Welcome everyone to Second Breakfast, covering week two of the Battlefield 3 campaign.

Jordan Schneider: Can we load the save, Tony?

Tony Stark: To quote a famous rap duo — there’s no save point. We’ve now learned that life is not a video game. When you make an oopsie — or several oopsies — you don’t get to return to the prior mission and try again. You went in with the loadout you have. There are no loot drops from which you can upgrade — although technically the Lucas is a loot drop.

We did not plan for the IRGC being able to operate like the IRGC — in small groups, under mission command. That’s the whole point of the IRGC. You cut the head off the snake and the snake’s still there. And it seems like we just didn’t care or didn’t plan for that.

Justin: Eleven MQ-9s have been shot down as of two days ago — subject to change. There’s also the fueler that crashed yesterday. I was seeing reports that the administration was shocked. And yet we know the Houthis shot down five MQ-9s over a couple of years using Iranian surface-to-air missiles. Who do you think taught the Houthis to do that? The idea that this was going to be “we’ll be fine, we got this” — the planning continues to blow my mind.

Jordan Schneider: This administration — and really the first Trump administration — has rolled snake eyes every time they’ve used military power. Soleimani worked great. The 12-day war, no real blowback. Venezuela, a triple snake eyes perhaps. When you get on a roll like that, you keep doubling down, and all of a sudden those downside scenarios you were briefed on with the Soleimani strike, the 12-day war, the Venezuela stuff — they stop resonating. Now we’re in a scenario where all of these second-order impacts are totally predictable and presumably were predicted for decades. Same thing with critical minerals in China. But if you think everyone else has it wrong and you’ve got the hot hand, why not? Except here we are in this total mess.

Jordan Schneider: Shashank, how are we doing strategically?

Shashank: I think we’re doing terribly. This reminds me of entering a gigantic trade war with China and failing to anticipate the way the adversary gets a vote — they have leverage of their own, they have rare-earth export controls — and then being humbled by that because of a failure to think in terms of real net assessment. We’re seeing a repeat of that.

I see almost daily updates from CENTCOM, from Dan Caine, from Pete Hegseth, telling me how many thousands of targets have been struck — 6,000 as of Thursday, March 12th — as if I’m supposed to infer something from that, as if the jump from 3,000 to 6,000 is twice the winning. James Acton of the Carnegie Endowment put it well: this sounds very MACV, very Vietnam body count. It’s not about effects — free navigation, steady erosion of the regime’s grip on power, inability to conduct salvos. It’s about inputs. The number of bombs you’ve dropped, the number of people you’ve killed. Not what you’re achieving, even if you knew what that was.

On one specific count we have to give clear credit: suppression of missiles, left of launch. The Iranian launch cadence has dropped substantially. They’re having enormous trouble putting launchers out without being hit. This is not a repeat of 1991 Scud hunting — this is much, much more successful. The revolution in ISR, precision strike, and response time is real.

But two other things stand out. First, it’s the Shaheeds causing a huge problem, and suppressing those launches is much harder. We’ve seen them fired from Lebanon toward Cyprus — a niche UK angle, since they hit the hangar where I think you housed your U-2s. The launch cadence remains very high, they’re still causing chaos, and they’ve hit some things with real precision. On ballistic missiles, the numbers have dropped substantially. On everything else, this is a mess. I see little indication the regime is close to dissolving. If the bombs fell silent tomorrow, the Iranian people would not have the wherewithal to go back onto the streets without being massacred.

And finally — while missile production capacity has surely been degraded, the political incentives have changed. If you are a wounded, grieving Iranian regime left in power at the end of this — which I think they will be — and you have a supreme leader whose family has been killed and who is thought to have opposed the fatwa imposed by his predecessor, you have a powerful incentive to double down on your nuclear ambitions. If that is the legacy of this conflict, all while oil heads toward $150 and cripples the economies of Asia and Europe while America sits comfortably behind its domestic reserves — that’s a complete catastrophe. And that’s before the second-order effects on America’s position in the Pacific.

Justin: We’re already seeing economic impacts in Asia — potential drops to a four-day work week in some countries. Even in the United States, there’s a fracturing of belief in military power, because we’ve handed the Iranians an economic weapon. What constrained Iran from closing Hormuz in the past was the threat of US military power to force it back open. We have two carrier strike groups in the CENTCOM area right now, and we’re not forcing open the strait. What happens when we don’t have two carriers there and Iran decides to close it again?

Tony Stark: This raises a bigger question: what has CENTCOM been doing for the last 40 years? The whole point of their existence — why they have two headquarters — is to keep that strait open. Yes, they had their GWOT adventures for 20 years and were very upset when those ended. But from a strategic standpoint, the point of CENTCOM is to keep Hormuz open. Either this was not the con-op they wanted — they may have wanted an overland run to Tehran — or they just took a backseat and said, “We can do this with minimal forces.” Given that the last time we fought a war with minimal forces, it seems like nobody has been held accountable for planning that region in 20 years.

Mines, Mines, Mines

Shashank: Let me give you an example of that lack of preparation: mining capabilities. We just heard Hegseth say there’s no clear intelligence the Iranians have mined Hormuz, although John Healey, the British Defence Secretary, has suggested they have. Whether or not they have yet, look at the state of mine-clearing capacity in the Persian Gulf. The Avenger-class mine countermeasure ships were removed from the region in January. That mission flowed to the LCS [Littoral Combat Ship] — and I’m sure many people are aware of the complicated history of that ship, which was supposed to be fitted with mine countermeasure modules and uncrewed craft. Those assets have been exercised, but they haven’t been deployed in that context.

Someone who served in Fifth Fleet told me that if the strait were saturated with mines right now, current assets wouldn’t be enough to clear it. You’d need additional Sea Stallion helicopters — multiple squadrons, all reserve components. They haven’t been mobilized, and they’d take about a month to arrive in theater. The last major minesweeping operation at real scale was Vietnam. If you’re planning to topple the Iranian regime and kill its leader, you’d think you might spare a thought for having enough mine countermeasures in the region.

Justin: Especially since this is a regime that has mined the strait before. They’ve routinely floated mines down the strait when aggrieved — not in large numbers, but they’ve done it. Oman has suffered from it. I can’t imagine there’s a war game in CENTCOM where they plan for what Iran does on day two and mining the strait doesn’t come up. Suicide boats, mines, something. It seems feckless.

Tony Stark: I have to assume CENTCOM assumed they’d get more time to build up and more forces to do this right. After the Cold War, a lot of the strategic support elements needed for these fights were moved to the reserves — which means you need more time to mobilize. Readiness is much lower, equipment is old. On the Army side, something like two-thirds of medical and engineer support exists in the reserves. On the Navy side, they used to keep watercraft in the reserves and then just got rid of them entirely. It’s quite clear we tried to fight an unmobilized war with active-duty forces only.

Jordan Schneider: Shashank, can we do the tactical story? You tweeted a question: can Iran lay mines precisely enough to avoid hazards for ships it wants through? And how do you mine the strait when American drones and planes are flying over this 30-square-kilometer patch of water? Can’t we just watch it at all times?

Shashank: I’m not a mining expert, but CENTCOM has dutifully destroyed all of Iran’s dedicated mine-laying craft — 16 or 17, I think. But Iran has historically prepared to lay mines through other means, including traditional fishing vessels, the dhows.

We need to keep in mind that the battlefield is more transparent than ever — surveillance is more pervasive and higher fidelity — but it’s not a literally, completely transparent battlefield with absolute coverage at all times. You’re running a campaign in which your surveillance assets may be in heavy demand elsewhere: tracking ballistic missile launchers about to fire on Israel, or assets targeting carrier strike groups in the Gulf of Oman. You may not be focused with all your Reapers and space-based ISR on Iranian fishing vessels in a congested waterway full of civilian shipping. Iran can still get stuff out there.

On whether Iran can lay mines with enough precision — Caitlin Talmadge suggested yes, it probably could. Abhijit Singh, a former Indian naval officer, made the point that even modern naval mines can distinguish ship size or acoustic signature, but they can’t tell the difference between an Iranian tanker and another tanker. Iran could jam up the straits even for its own exports. And yet Lloyd’s intelligence reported the Iranians have had about 10 ships through — they’re still getting their oil out. They don’t necessarily want to completely cut that route off for themselves.

Justin: I saw talk about seizing Kharg Island, the small island near the actual gate of the strait. Even if we did — does that let us say the strait is open? The Iranians have had 10 tankers through, but that Thai tanker that tried yesterday caught either a missile or a mine — looks like a missile, from the waterline damage. At least two lifeboats were off, the ship was on fire. Why would any other bonded international carrier try to force the strait? If you’re not flying an Iranian flag, you’re apparently likely to take a missile.

For all the strategic blunders we could discuss, this one gets me the most. The maximum pressure campaign during Trump one was supposed to demonstrate that we can economically cripple Iran. Instead, we’ve shown Iran that it has the ability to impose devastating economic consequences on the rest of the world by choking off 20% of the daily oil and gas supply.

Jordan Schneider: At the end of the day, would Trump rather have an Iran with a nuclear bomb or oil at $250?

Tony Stark: Bessent announced today they’re going to temporarily lift sanctions on some Russian oil. It’s quite clear he’d prefer oil prices to go down. But I think there was just no serious planning here. That’s the actual answer.

Shashank: I’d contest that binary. If the option truly were an Iran on the cusp of a nuclear weapon versus a major war causing an energy spike rivaling 1973, I could understand the trade-off. But the Iranian nuclear program had not substantially advanced since the guns fell silent after the 12-day war. There was residual capability — 400 kilograms of HEU sat under the rubble between Isfahan, Fordow, and Natanz — but it wasn’t materially closer to being weaponized. It was the missile program where we saw real progress, which is why the Israelis saw such a serious threat. The concern is that we may get oil at $200 a barrel and a nuclear Iran. Getting oil to $200 doesn’t solve the problem. The likeliest outcome is the regime stays intact, there’s some kind of deal, and it won’t be clear that Iran’s nuclear ambitions have been extinguished.

Seizing the Uranium

Tony Stark: Justin, you and I have both done the train-up for CWD extraction. It sucks. This is not a light lift, and there’s still no plan to recover the HEU. Everyone needs to understand — this is not five guys from JSOC with a black bag. It’s a task force–sized event at minimum, and that’s assuming everything goes right and you hit all the sites simultaneously.

Shashank: I wrote a piece on a raid to seize the HEU. You can envision a gigantic ground operation in Isfahan, but calling it a “special forces raid” is misleading — it would be the largest airborne raid in military history on its own. You’d have special forces, yes, but also a battle group to brigade-sized force holding a perimeter while you parachute in heavy machinery on pallets to get through the rubble.

What makes me really question it is that this material isn’t in one place. Raphael Grossi of the IAEA says roughly half is at Isfahan, but there are still a couple hundred kilograms between Natanz and Fordow. Executing one raid feels at the very edge of realistic military capabilities — maybe only the United States could pull off something of that magnitude. But doing it at three sites simultaneously to achieve surprise? It feels preposterous.

Justin: That’s the problem. They couldn’t do them simultaneously — they’d have to go in sequence. And as soon as you hit the first site, you’ve set a trap at the others. When you think about extraction teams, breachers, specialized training, equipment, suppressing enemy air defenses — there’s just no way you could do Natanz and Isfahan at the same time. There isn’t enough mass to run all three special missions simultaneously unless you’re invading the entire country.

Shashank: Can I just reflect on the incredible situation we’re in — an administration of people who spent their careers involved in Middle Eastern conflicts, who drew from that the lesson that these wars were America’s greatest folly for three decades, consuming national resources and sapping the country’s prosperity, will, and cohesion. And those same people have launched a conflict in the Middle East that will have massive spillover effects for America’s position in Asia — let alone Europe, if they cared about Europe, which they don’t. I would love to get Elbridge Colby in a room with a beer —

Justin: He’d take the beer — you’d have to do wine, I’m sure.

Shashank: A crisp Sonoma Chardonnay — and ask him: how did we get here? With the Bush administration, there’s a coherent intellectual chain from the unipolar moment through 2001 to 2003 — a thread of logic, even if you see it as gargantuan folly. With this, it’s a completely different kind of blundering.

Justin: This is Andrew Bacevich’s theory on steroids — the power of the American military has the ability to corrupt and make people think it can do anything, including substituting for policy, without any overarching strategy. The biggest problem with the use of military force right now is that no one can describe what the goal is. Is it regime change? Is it the nuclear weapons?

The Backlash

Tony Stark: I want to pivot to what’s really concerning me. Between the Anthropic debacle, the Iran invasion, and a few other things, a backlash is coming against all the work done in the last five years to build munitions stockpiles, build autonomous systems, and get Congress on board with funding for a Taiwan fight. After 2026, when there’s likely a split government, and especially in 2028 — the majority of people will be extremely skeptical of all of this because it’s been used in ways we didn’t intend. It’s going to be very hard for Democrats to convince their base to keep funding the defense industrial base at maximum levels. It feels very Imperial Russia circa 1914 in terms of mismanagement.

Justin: It won’t just be Democrats. The MAGA wing is already fracturing over this. Continued investment in the military is leading to continued use of the military, and that’s going to cost support on the far right too.

Shashank: It was interesting to see Joe Rogan’s comments on this. The polling suggests the MAGA base isn’t revolting broadly — that’s not in the numbers yet. But among prominent voices in that base, there’s real discomfort. And that will be shaped by the outcome. If there’s an early deal and the administration snatch a diplomatic victory — negotiate the withdrawal of Iranian HEU, limits on the nuclear program, declare the missile threat neutralized, announce “we’re going to build a great shiny new Trump Tower on Kharg Island” — you can see something satisfying enough people. And we shouldn’t exclude regime change. This was a weak regime going in. I don’t believe there’s been a meaningful rally-around-the-flag effect. The Israelis have been striking Basij and IRGC forces across the country, including provincial elements. Regime change is still very much on the table — though the main risk is disorder, civil war, and armed rebellion rather than anything neat.

Jordan Schneider: Can you talk about the Israeli campaign? I don’t understand how blowing up IRGC offices substantially degrades the government’s ability to put down protests. The guns are in people’s houses. What’s the theory?

Shashank: Your point about financing is interesting — there was a missile strike on the SAPA bank in Tehran on Wednesday, a direct effort to disrupt salary and payments to security forces. As for the offices, I imagine the logic is that you break command and control — you make it hard for authorities to coordinate a response to mass revolt, to mobilize local forces. You hope the individuals tasked with repression decide to leave their uniforms behind and go home, the way we saw in Afghanistan in 2021 and Syria 18 months ago.

Will it work? I’m doubtful. You may see a periphery effect where outlying areas usurp state authority, but that doesn’t mean a uniform ripple into Tehran. Israeli officials who understand Iran well are beginning to acknowledge this — there was an excellent piece by Emma Graham-Harrison in The Guardian quoting Israeli officials conceding the regime isn’t crumbling at the pace they’d hoped. Netanyahu himself said — in not terribly good taste — “you can lead a horse to water, but you can’t make it drink.”

Jordan Schneider: The Netanyahu stuff is fascinating. You see this analogy — is it the Gazans’ fault they haven’t toppled Hamas? That kind of strategic outlook, applied not to Hamas but to an entire country the size of Western Europe, seems tricky.

I want to come back to how this works out. Shashank laid out one pathway — revolution. Are there scenarios where the regime stays in control, even if they get Khamenei and it’s the third or fourth guy, but things are basically okay? Iran without a nuclear weapon in three years, oil manageable?

What Comes After

Tony Stark: Regardless of whether the Ayatollah or someone like him is in charge, there’s still the Sunni-Shia rivalry, still the Saudi-Iranian regional competition. This is like asking Russia to join NATO — even with a less hostile regime, there’s a limit to how friendly they become.

Justin: With HTS in charge of Syria, the Shia crescent is broken — the Iran-Syria-Lebanon corridor that let Iran project power against Saudi Arabia. You’d already stripped a lot of Iranian capabilities between the Hezbollah war, the beeper explosions on Hezbollah leadership, and the 12-day war. The really hard thing for a diplomatic settlement is that the regime now has to agree to give up the HEU — that’s been a stated reason for this war from both the Israeli and US sides. And there’d need to be some dramatic opening to the West. I don’t see that. Because the day before this started, Iran was racked by massive protests, had just killed 30,000 of its own people, and had lost its two largest regional allies in combat.

Shashank: I’d reflect on how the administration handled the Houthis 18 months ago — heavy bombing, some effect, but didn’t really reopen the Red Sea. So what did they do? They said “our work here is done,” stepped back, and declared victory. You can see the same totally self-declared victory here that bears no resemblance to the actual outcomes.

Justin: That’s probably the most likely outcome.

Shashank: The other interesting question is where the Gulf states go. This has been a total shock to their psyche — their vulnerability exposed, business confidence shattered. They’re furious at the US and Israel for dragging them in, but also furious at Iran for breaking all previous taboos on targeting, particularly Oman, which feels deeply betrayed. I can see a massive defense boom in the Gulf. The question is who they buy from. Do they keep their eggs in the American basket, or spend heavily in South Korea, in Europe, with Rheinmetall? Do they try to play nice with Iran — double down on the modus vivendi strategy of the last three years? Now that’s broken down, do they say, “We need protection”? Or do they pursue armed neutrality — arm to the hilt — which is exceptionally difficult for countries this size, given their dependence on things like Fifth Fleet and CENTCOM co-location?

Justin: Ukrainian Brave One and the Ukrainian defense techs are actively seeking seed and Series A funding. I know where there’s cash and willingness to venture-back anti-Shaheed weapons. I wouldn’t be surprised to see the Gulf states investing in Ukrainian defense tech — companies looking for production partners. Outside of high-end weapons, there’s no reason they’d keep buying lower-end US defense tech versus diversifying to the Ukrainian and European market.

Tony Stark: The defense tech rise is no longer just a US story. My other question: what happens to the IRGC? Say you get a friendly regime — that’s going to cost the IRGC money or insult their beliefs. Do you de-Baathify them? Good luck enforcing that. If the IRGC disperses, how does that help the regime or the region?

Justin: The Quds Force and the IRGC run a vast commercial network — many of Iran’s key ambassadors in Lebanon were Revolutionary Guard members. They have front companies pulling revenues from construction and shipping contracts across the region and beyond.

Tony Stark: So are we looking at a KGB-goes-to-the-mob scenario? The IRGC becomes its own version of organized crime post-conflict?

Jordan Schneider: Or Japan in the 1920s and ‘30s — the military just starts killing the people running the country who aren’t aligned with them. Gets dark fast.

Shashank: We don’t have many models of stable transitions from these ossified, oligarchic security states — Persian siloviki structures. De-Baathification was an almighty mess that leaked security capabilities into the non-state sector. The Russian model: the security apparatus just becomes a new nobility, as Andrei Soldatov puts it. The Egyptian model: the army takes over, praetorian-style. There aren’t many cases where these people go home peacefully and the economy gets demilitarized.

Jordan Schneider: Maybe the closest analogy is Cairo — you got your revolution, everyone kicked the military out, and three or four years later they’re back. Even that transition would’ve had less headwind than whatever Iran’s going to face.

Shashank: It is interesting that the administration seriously considered arming Iranian Kurds to pressure the regime, and from my conversations, changed its mind.

Justin: That probably had something to do with the nuclear-armed NATO ally to the north.

Jordan Schneider: Are we sure that was real, Shashank? Not just we’ll throw it out there, like “we’re going to arm the Québécois”?

Shashank: The line between throwing it out there and genuinely considering it is blurry in this administration. But I spoke to Israelis who were in those conversations.

Justin: After everything we’ve seen — every time the Kurds look like they’re forming a state, whether in Northern Iraq, Northern Syria, or now Iran, Turkey goes in and bombs them. Unless the idea was to drag Turkey into putting boots on the ground in Northern Iran.

Shashank: 3D chess — the Turks as the surrogate ground force who topples the regime. By the way, three ballistic missiles have been fired at a NATO ally in this conflict. That’s just nuts.

Tony Stark: Were they aimed at İncirlik, where we keep our nukes?

Shashank: I don’t know, but that would be a logical conclusion — aiming at a site that, by some accounts, stores B61s. I think they were intercepted by SM-3s.

Justin: They’ve also hit Jordan — Azraq and the Mafraq joint US-Jordanian base. The whole region is getting things thrown at it.

The Targeting Machine

Jordan Schneider: I want to talk targeting. Shashank had a wonderful article in The Economist — “How America and Israel Built Vast Military Targeting Machines” — an overview of how you can do the Vietnam thing, not by flattening forests, but by blowing up thousands of specific things within two weeks that are, for the most part, not girls’ schools. Shashank, reflections on that — and broadly, is the future of this stuff like Waymo being better than me at driving a car? Or is it the American military capability bias, where you trick yourself into massive strategic mistakes because you have this futuristic, superhuman ability to identify things you might want to blow up?

Shashank: Part of this story was about AI and demystifying the role of frontier models. I know you’ve talked about this on previous shows — people want to know what Claude is doing. It’s not actually doing all that much. The public accounts saying Claude has been identifying targets are misleading, based on my conversations with people involved in both the AI and targeting enterprises.

A lot of the piece was explaining what the Maven smart system actually is. The phrase I’d use is “decision support system.” Inside it, there’s a command-and-control element, a target intelligence element, an intelligence fusion element, a battle damage assessment component. It’s a machine that helps humans do at scale what they previously did with human staffs and obsolete computer aids — identify targets, put them into banks, match the right munition, check what’s nearby, all of that at industrial scale. The bespoke AI models handle things like object recognition. But what Claude does is primarily synchronize the other models — it operates at a higher level, overseeing the system.

The more interesting question is what happens when you can generate these vast target banks. We tend to think of AI-aided targeting as being about speed and overmatch — the classical maneuver warfare idea of imposing cognitive paralysis, hitting so many decision-making nodes simultaneously that the enemy can’t react. What’s striking about this conflict is that the same industrial-scale machinery is being applied not for rapid maneuver warfare, but for something much more like attrition. CENTCOM says “we’ve hit 6,000 targets, now 7,000” — a system built for cognitive paralysis and shock, deployed in a context where there’s no more shock. You’re just eking out more targets to keep striking.

My colleague Anshel Pfeffer, based in Israel, told me that in 2006 in Lebanon, the Israelis said they’d run out of targets around day 30. The lesson they drew was that you need a machine that can produce more targets. But none of this tells you whether your 6,000, 7,000, 8,000 targets have a causal mechanism for defeating the enemy. We have to be clear: this is operational excellence, but it’s not always married to something that actually wins wars.

Justin: That’s exactly right. Targeting, in its full military definition, supports the commander’s objectives. It’s not just about having more targets — it’s about targets that achieve a desired effect. Seizing a hill, denying the enemy a capability, whatever. Are the commander’s objectives just to hit more targets? Hegseth came out four or six days in and said we’d dropped twice as much as during shock and awe in 2003. Yeah — but we took Baghdad by that point. The objective was clear.

There’s a distinction the military makes between a high-value target list — this costs a lot, this is a leader — and a high-payoff target list: if we take this thing out, it lets us achieve this effect. The system can’t make that distinction. That’s where commanders have to get involved. And what is the objective? Every member of this administration who’s spoken about the desired outcomes has said something different. The same person has said different things in different press conferences.

Tony Stark: To go back to the video game analogy — there is no strategic progress bar where you hit 6,000 targets, you’ve got 4,000 to go, then victory. What the military means by autonomy in decision-making is dirty, dangerous, and dull. Maven is doing the dull work. When you’ve processed 2,000 targets and have 2,000 more to go, you’re not just throwing darts. During my first NTC rotation, my S2 hadn’t slept in days and was falling asleep and hallucinating during the brief — the guy telling you there are 40 tanks outside when there aren’t. That’s the problem Maven solves. But we’re not closer to victory because a machine is deciding which launcher to hit instead of a human.

Jordan Schneider: You can see how it happens — you get briefed, all these targets on a map, someone tells you with genuine confidence that they can blow all of them up in a week. Then 24 hours before, someone says, “We know where all the leaders are going to be at this exact moment — you’ve gotta act fast or we miss the window.” And you can imagine people in the room going against their better instincts and saying, “Fuck it, it’ll probably work out. Look at all these cool Palantir products.”

Tony Stark: I’m just picturing the Halo multiplayer announcer yelling “Killionaire!” after the Israelis hit that 88-person meeting.

Jordan Schneider: So dark.

Shashank: There’s an interesting disjoint here between the logic of shock-and-awe target banks and the reality of a grinding strategic bombing campaign. You don’t get to pick the kind of war you fight. There may be a strategic bombing component, but you also have to deal with things like Hormuz — which demands dynamic targeting of new mobile targets in complex terrain, shipping lanes, and areas you may not have surveilled before the conflict. If you have a military force that’s superb at strategic bombing but struggling with the dynamic dimension, that’s a failure of strategy.

Justin: This is the natural outgrowth of the John Boyd–Curtis LeMay strategic bombing school: “we can do it all from the air.” It’s been disproven so many times, and yet here we are back to McNamara — “I’ll tell you where to drop the bombs, and we’ll drop enough on North Vietnam to win the war.” We dropped more in a month than in all of World War II, and it made no demonstrable difference. You run the same risk here. All I’m asking for is a clear objective. If you have one, you can derive a coherent use of force. Without it, you’re just striking things.

Comms Over Policy

Tony Stark: From a policy standpoint, this comes from the triumph of comms over policy execution. For the last 10 years — the last five especially — Hill and executive staff have prioritized messaging bills and messaging policy over actual execution. I was at drinks two weeks ago with a staffer who said, “I so much prefer comms and messaging bills over actual policy work.” I almost fell out of my chair, but it’s common among the younger staffers now running the administration. To them, this is policy success — this is all they know. Something like 80% of bills on the Hill are messaging bills. They have their highlight reels, their Call of Duty kill streaks. I saw one with bowling pins and an F-18 strike.

Jordan Schneider: Wii Sports, man.

Tony Stark: To them, this is success.

Jordan Schneider: Presidents want to say they did things and won. Have 10 different victory conditions and you’ll probably hit one or two. Maybe what’s most interesting is the decision to talk about regime change from the start. They either thought talking about it would make it more likely, or that it was probable enough that declaring it would tip things over — the way HW got an uprising in 1991, which maybe with concurrent bombing could have worked. That seems like the big fork in the road: declaring what victory means.

Clearing the Decks for the Pacific?

Shashank: I was talking to someone this week — I don’t share his name, but it’s worth putting on the table. The Israelis learned since October 2023 that they’d have been overwhelmed fighting their adversaries simultaneously — Hamas, Hezbollah, and Iran all at once. Instead they dealt with them sequentially: degraded Hamas, then crushed Hezbollah, then turned to Iran. Each adversary mostly stayed out of the other fights — interestingly, the Houthis were the exception, jumping into every round.

There’s an argument that says, from the Pentagon’s perspective, if you’re looking at a window of risk in the Pacific from 2027 onward, you also have a concurrency problem with the Persian Gulf. There’s an interest in deeply reducing Iran’s military capabilities before any future Pacific conflict. I’m very skeptical. This conflict has real effects on American strength and readiness, and it’s revealed Iranian capabilities that were perhaps unexpected — giving Iran more deterrence, not less. But I challenged myself to at least understand the logic.

Justin: Two counters. First, everything that’s happened has benefited Russia, which is China’s largest military supporter. If you’re planning for a Pacific conflict, you’d want Russia weakened — but rising oil prices are making Russia materially stronger. Second, the administration just delayed the $11 billion arms package to Taiwan, supposedly for the upcoming Xi-Trump summit. But that signals the Pacific clearly isn’t the top priority — because if it were, you’d be strengthening Taiwan at the same time you claim to be setting conditions for a future confrontation.

Tony Stark: It was more comfortable to make the “clearing the decks” case when the war looked like it might be over in 72 hours. Then you could say, “It’s another Venezuela — we get a favorable regime.” I’ve heard that from senior staffers: “This is knocking down the dominoes” — always a great analogy in foreign policy. It’s clearly not the case. This remains a net negative. I can’t imagine Admiral Paparo’s blood pressure is any lower than it already was.

Justin: He’s a short, angry man — right now, angrier than most.

Lessons for the Pacific

Tony Stark: Are there operational lessons the Chinese are taking from this?

Justin: Their production capacity is the key factor. What I expect they’ll observe — Frank alluded to this last week — is that Patriot and THAAD will start changing their TTPs, potentially going from two interceptors per incoming missile down to one. Those changes lower shot probability — there’s a reason it’s two-for-one when you’re targeting something dynamic and moving. With China’s production capacity, they’ll be able to quickly overwhelm defenses protecting critical assets.

They’re probably concluding that Patriots are really good against ballistic missiles, but the limitation is exactly what everyone thought: numbers and production capacity. They’ve already hit at least one Patriot battery in Jordan with a Shaheed — it looks destroyed from overhead imagery.

Shashank: On the utility of long-range cheap strike munitions like the Shaheds — very few are getting through to Israel. They’re being shot down en route by aircraft carrying laser-guided rocket pods or air-to-air systems. That’s not a hard technical problem, just a supply and cost problem at scale. But at short ranges, they’re getting through because there’s much less warning time and less strategic depth. The Russians appear to have passed tactical lessons to the Iranians — the British think this is why the Shaheds can fly low enough to evade defenses and make it across the Mediterranean to hit Cyprus. We’ve seen precise short-range strikes on THAAD radar in Jordan, radar in Qatar, sites in the UAE, and communication nodes.

The operational lesson for the Asian context: at long range, these drones will struggle if you have enough air interdiction capacity. At shorter ranges, they pose a serious problem, and it’s not clear you’d have enough low-cost air defenses to cope on the timescale of a conflict.

Tony Stark: I wonder if that means for Guam, a lot of carrier-based aircraft will be tied up protecting it from long-range drones.

Shashank: You’re seeing that right now — a huge share of US and allied air power is being sucked into the defensive counter-air campaign against the Shaheds. It absorbs an enormous chunk of your force, even with low-cost interception methods.

Justin: One interesting development: the UAE is using AH-64 Apaches to target Shaheds. Helicopters fly low and slow, and they’ve got the right targeting capability — guns and rockets — to lock on cheaply. They’re proving to be a counter-drone platform nobody expected. The prevailing wisdom out of Russia was that the helicopter is dead, the drone will kill it. We’re now seeing that for mid-range defense, attack helicopters actually make pretty good counter-UAS systems. Not always, not every time, but it’s a real turn of events for a platform everybody was writing off a couple of months ago.

Tony Stark: I suspect that in the same way the Marine Corps walked back eliminating its conventional artillery, the Army is going to walk back eliminating a lot of its rotary aircraft.

Jordan Schneider: Thank you all for joining Second Breakfast, a real SportsCenter for war edition.

Shashank: Thank you for having me, Jordan. My Second Breakfast debut — very pleased.

Russell Kaplan, co-founder of Cognition — the company behind Devin — and previously at Scale AI and Tesla, joins the podcast to discuss what “software abundance” could mean for government.

Our conversation covers…

• Why government software is so broken — Despite spending over $100B annually on IT, critical systems at agencies like the Social Security Administration and U.S. Department of the Treasury still run on decades-old code that few engineers know how to modify.

• How two-year software projects become three-week ones — why AI agents are particularly good at the painful migration and modernization work engineers tend to avoid.

• What “software abundance” actually means — AI agents can handle the tedious work of switching systems 24/7, collapsing the switching costs, and forcing software vendors to compete on value rather than locking customers into outdated systems.

• AI for cybersecurity — From triaging massive vulnerability backlogs to automatically fixing CVEs, AI will be essential for defending critical infrastructure as attackers gain the same tools.

• The coming “post-coding” world — As models converge in capability, the key bottleneck shifts from writing code to understanding problems, reviewing systems, and deciding what should be built in the first place.

Plus, the future of procurement in an AI world, fraud detection in government datasets, the DMV as a software problem, and why Kaplan thinks the real skill of the future is knowing which problems matter.

Listen now on your favorite podcast app.

Thanks so much to Cognition for sponsoring this episode.

Why Government Software is Bad

Jordan Schneider: What is wrong with software in government?

Russell Kaplan: We have a lot of problems with software in government, despite the government actually being the source of much software innovation for a long time. Today, the state of the world is pretty sad.

To put some numbers on it, more than $100 billion a year is spent on IT for the US government. A lot of these systems are ancient. The GAO did a study finding that in the 2010s, there were 10 critical legacy systems that needed modernization. Only three of them have even started the process. As a country, we’re spending a lot of money and not getting the same results that we see in the private sector.

What’s happening now with AI and software engineering is changing the private sector, but I’m personally really excited about how much it could change for the country as well. It’s actually really important for the next generation of the United States to get this right.

Jordan Schneider: You mentioned the $100 billion a year number — what does one dollar get you in the private sector, and how does that compare to some federal or state department spending that money?

Russell Kaplan: In the private sector, the way we buy software is — we have a problem, we see what’s the best tool on the market for that problem, and we buy it, whether it’s a SaaS solution for my CRM or infrastructure for scaling my database. The market tends to be more efficient.

For the government, it’s a different story. It’s really challenging for the government to purchase software directly. There’s a much higher compliance and regulatory hurdle for software vendors to even start working with the government. We faced this at Cognition — getting to FedRAMP High was a journey. But even once you’re there, there’s a lot of indirection. Many of these systems were designed with good intent — making sure there’s no corruption, that RFP processes let government buyers get the best price. But the net result is that it’s enormously slow to get software into the government, and in particular to reuse software. A SaaS tool has a much easier time being bought by a private sector company versus a government agency, which often needs a much higher degree of ownership of the product they’re using.

The net result is we’re still powering most of the country’s critical systems with ancient code. Tens of millions of lines of COBOL run our Treasury, our Social Security Administration — and it’s not getting better.

Jordan Schneider: Is COBOL not Lindy? What’s wrong with running a government on ancient software languages?

Russell Kaplan: The problem is that nobody knows how to write COBOL anymore. The people who wrote these systems are often no longer there when changes need to be made. There’s a small cohort of specialists who learned COBOL decades ago, still write it, and need to be brought in for any change — but there are fewer and fewer of them, and the changes get bigger and bigger. As a result, everyone’s scared to touch the big mainframe systems powering critical infrastructure for the country.

This problem exists in the private sector too. A lot of banks we work with at Cognition, large health insurers, airlines — they’re running these large-scale systems. To give COBOL credit, it’s a very performant language, really efficient and fast. It’s working, so people don’t want to mess with it. The problem arises when requirements change — it’s really hard to move with those requirements, to update them. That’s where the slowdown comes.

Jordan Schneider: For the uninitiated, why are there new programming languages, and what do they enable beyond just having more people who know Python versus stuff invented in the ’60s and ’70s?

Russell Kaplan: A brief history of programming languages — even before COBOL, people were writing assembly. In 1948, assembly became popularized, which was a big upgrade from the previous era of punch cards. The 1890 census was the first time punch cards were used in a real production setting. The government realized that counting the census manually was going to take more than 10 years, so they literally weren’t going to get the job done. They put out a call for technology, and in 1890, punch cards solved the problem.

Jordan Schneider: That 1880s baby boom — the straw that broke the camel’s back.

Russell Kaplan: It really was. Too many people, not enough counters. It was going to take 12 or 13 years doing it the old-fashioned way. Punch cards are a very simple representation — a hole or not a hole representing a 1 or a 0 as a data storage format. Assembly, COBOL, and modern languages like Python and Java all walk up the ladder of abstraction, making it easier to tell your computer what you want it to do. You need increasingly less arcane specialized knowledge and increasingly more intuitive interfaces. AI is actually the next logical rung on the ladder. It’s not some fundamentally structurally different thing when it comes to programming — it’s telling your computer what you want it to do, but in English, in a way that’s natural for everyone.

Jordan Schneider: The older programming languages were optimizing for the constraints of their particular generation of technology — more severe memory, storage, and processing restrictions. In today’s languages, pre-2025, you still needed a person to sit down and write every line of code. That’s not really a thing so much anymore.

Russell Kaplan: The hardware teams work so hard to optimize the chips, to keep pushing Moore’s Law. And then lazy software engineers like myself stop worrying about garbage collection and memory management and relish the productivity gains without worrying about efficiencies. We do get more efficient, but typically most of the hardware performance gains are captured by making software easier to write.

One thing relevant for both government and the private sector — AI might flip this, where it’ll be able to write really optimized assembly or binary directly because it doesn’t need the intermediary interface that a human can understand.

The Coming Age of Software Abundance

Jordan Schneider: Beyond insanely performant code, what else can we expect in a world of software abundance?

Russell Kaplan: The most important thing is that software is going to start flowing more like water — easy to move around, easy to change, easy to get more of and a lot more will be created as a result.

If you look at the structure of the SaaS industry and software as deployed in government and private sector, a lot of how things are shaped is because of how hard it is to change things. Migrating off of a database you’ve installed and designed is a massive project. If you want to buy another company, one of the most complex parts has historically been integrating the software, infrastructure, IT systems, and data storage. There’s sprawling complexity, and a lot of vendors use switching costs to build a moat around their businesses — they land the contract, set up, discount the first year, then make it impossible to leave.

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A big structural change is about to happen in the economy, and you can already see some reactions in the public markets. That strategy doesn’t work anymore. You can’t hold your customers hostage with switching costs when AI is going to do the switching and work on it 24 hours a day without getting bored of a really tedious process. The ability to move from whatever you have to the best tool for your problem is going to lead to a lot of changes.

Jordan Schneider: What’s Cognition doing to make that future possible?

Russell Kaplan: We started in January 2024 — about two years old at the time we’re recording. We began as a research lab focused on reasoning and long-term planning for software engineering. At the time, there was great progress on chatbots, but what about making things that could think for a really long period and apply that to software engineering?

We launched Devin, the AI software engineer, in March 2024. That was the first real draft of what an autonomous agent should look like — more like a digital coworker you delegate work to, as opposed to a copilot. Now that concept is extremely popular in software.

When you think about the complexity of switching costs, migrating, and modernizing. There’s an architecture part — deciding what’s wrong with the status quo and where to go — which is still done by humans. But once that decision is made, the execution is often toilsome — paying down tech debt, refactoring file after file of old code. That’s the stuff engineers really don’t love to do.

Cognition provides Devin as an AI software engineer that people can deploy against their code to quickly transform it, improve it, modernize it, upgrade it. At this point we’re used by a lot of the Fortune 500, by global organizations, really focused on large complex systems that require serious amounts of existing context to make useful changes.

Jordan Schneider: Let’s do the compare and contrast with Claude Code.

Russell Kaplan: By the way, I think Claude Code is awesome. The explosion of developer tools in AI and software engineering has been crazy to see — not just Claude Code, but Codex, other IDEs, CLIs. The interface is constantly changing.

Where Cognition sits is we have a platform, we have an IDE — we acquired Windsurf, the agentic IDE, in 2025 — and we built Devin, the autonomous agent. The biggest difference between Devin and Claude Code is really whether you’re running in the cloud or locally. Can you spin up the agent in parallel in a fleet, or is it running on your machine? It’s a fundamental architectural difference — do you give the agent its own computer?

The way we work with companies is also pretty different. We’re less of a “here’s the tool, go figure it out” approach. We work with the largest, most complex organizations in the world. These folks don’t just have a developer tools problem — they often have a transformation problem. How do I get this major outcome done in 3 months instead of 2 years? We’ve built a large forward-deployed engineering team for our size of company, and we go work with the government and enterprises to partner together on driving meaningful outcomes.

Jordan Schneider: Why do they need that, and not just the tools? Or do we wait 6 months or a year until the technology is so good that all we need is a model to go fix everything for us?

Russell Kaplan: That’s the AGI maximalist case. If we just have the best possible model, shouldn’t everything else just happen? The answer is no.

Have you seen the chart of inflation by sector over time where plasma screen TVs are massively deflationary, but healthcare and tuition keep going up? That chart is my mental model for the post-AGI future. All of the things that are intelligence-soluble get really deflated. But what you’re left with is the rest of the complexity of the real world, which is actually quite substantial. How are you even allowed to deploy in the environments you need? How do you work with the people who are ultimately in charge of these systems to drive the outcomes they want? How do you reframe and restructure the process of how technology is built or procured inside an organization?

The models are going to keep getting better and make software easier and easier to create. It’s all the other problems that get left behind.

Jordan Schneider: We’re recording this the afternoon of Friday, February 27th. There are two and a half hours left before Pete Hegseth drops the anvil on Anthropic, apparently. Given that Devin can pull from all the different models, what challenges and opportunities does that give you from a product development perspective?

Russell Kaplan: If you’re the DoD, you’re certainly frustrated and worried about the decisions of any one model provider affecting your mission. Every private company has the right to say, these are the use cases we want to serve and these are the ones we don’t. Kudos to Anthropic for stating clearly what they want to do and not do.

But it raises the question — should model providers even be building the vertical tools on top? Is that the best experience for customers? If anything, we see the opposite — differentiation among models is decreasing, not increasing, over time. Frontier eval scores for software engineering benchmarks show the gap between the best models right now is less than half what it was 12 months ago. As companies spend billions and tens of billions of dollars on bigger clusters and bigger models, the models themselves are converging.

If you’re a government buyer, you typically care more about the outcome you’re driving than which model you’re using. In some ways, this gives a structural advantage to the agent labs — Cognition being one — because we’re focused on the customer problem. No matter what models exist or don’t exist, we’re going to combine them in the best way. We’ll have our own specialized models for very specific, narrow use cases, but the goal is to drive the outcome you want.

Jordan Schneider: We have a running gag on China Talk about the AI mandate of heaven. Even though it’s been Anthropic’s for a hot minute, listeners will recall the world in which it was Gemini’s and OpenAI’s. I hear you on models converging in capabilities, but when I play with them, they do feel different — people talk about being better at this or that thing for software. How do you guys figure out who to assign what work when we’re talking about Devin?

Russell Kaplan: On the mandate of heaven piece, these things are cyclical. One thing that’s interesting about software engineering in particular is that the right form factor for building software is constantly changing based on the underlying capabilities of the models.

When we launched Devin in March 2024, it was just at the edge of what was possible — having an agent you could truly delegate work to and come back. Honestly, it wasn’t even really useful for us for another 3 months after we built the prototype we shared with the world. It took about 3 months for us to use it enough internally that Devin became the number one contributor to Devin. Then there was another several-month lag before it became deployed in production settings useful for customers.

As models improve, the form factor for how to use them keeps changing. In coding, we went from tab completion — like pressing tab in a Word doc to get the next response, but in your code editor — to a local chat experience where you can chat with your codebase and ask questions, to local agents, to now increasingly autonomous agents you can delegate work to. The form factor might look completely different again 6 months from now. The mandate of heaven is probably going to keep changing based on who is first or best at the next form factor. Every new form factor is a new front to battle.

As for evaluating the models themselves, we built an internal comprehensive evaluation suite. The original draft was called “Junior Dev Eval” — could these models act like junior developers? We have a fork of it now that’s more like a “Senior Dev,” because the models keep getting better. We work with every lab. Before they release models, we run our evals, give them feedback, and say where they’re strong and weak and how they can improve. We have a great partnership with every lab on this. Many of them have told us we have the best private evaluation suite for agentic coding tasks that’s independent from a model provider.

We care a lot about evals because our customers want the best models. The other interesting data point — no matter what task you give, eval scores are consistently worse if you constrain the agent to one model versus letting it use multiple. The differences are real — whether it’s personality, macro context understanding, or details, these little differences add up.

Jordan Schneider: That’s really interesting. Is there a structural reason for that staying true forever? If we’re holding equal the distribution of AI researcher talent, and everyone has the same amount of chips across the 3 or 4 labs, what is the reason why things are spiky in one direction versus another?

Russell Kaplan: The structural equilibrium is one of model convergence — capabilities increasingly similar, basically similar levels of performance in every domain. So why would that happen?

First, there’s the scaling laws. It takes exponentially more cost for linear gains on any benchmark. At small scale, it’s easy for one firm to spend 100 times more than another — $1 million versus $100 million. But once you’re all spending hundreds of billions of dollars, it’s hard to get a multi-order-of-magnitude lead over your competitors.

There’s also the practical reality that non-competes are unenforceable in California, and people move from one lab to another all the time. The half-life of a proprietary algorithmic insight is probably about 3 months. Even within the labs, you have one person working at OpenAI and their partner working at Anthropic. The half-life of proprietary IP in Silicon Valley is short.

Once the models roughly converge, maybe some personality differences persist — not capabilities, but personality. But the last point relevant for every task — we have this mantra in Silicon Valley that “we always want more intelligence.” We’ve got to build clusters of compute in the galaxy to harvest energy from every star. There are use cases for ever-increasing intelligence. But this ignores the fact that for any given application domain, you often reach a threshold of intelligence saturation where it’s enough.

Today, if you said, “Let’s build a simple static frontend site for China Talk,” any frontier model would do that well. Once you’ve hit intelligence saturation for a given task, you don’t care which model you’re using — you care about whether it’s fast and cheap. Increasingly, more domains are going to see this intelligence saturation, at which point the model matters less and the interface, the experience, and how it drives outcomes end-to-end for your company or government organization matter more.

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AI Agents for Legacy Systems and Cybersecurity

Jordan Schneider: Let’s talk about driving outcomes. Before we get to the government stuff, what are some enterprise case studies that illustrate what 2025–2026 models are capable of powering through Devin?

Russell Kaplan: The thing that’s surprised and impressed me most is the ability of large organizations to take autonomous agents and do massive multi-year projects in weeks or months.

Here’s an example. A law changed recently in Brazil requiring taxpayer ID numbers to become alphanumeric instead of purely numeric. Think of it as Brazil’s Y2K — it’s called the CNPJ migration. Every system in the country that tracks corporate taxpayer IDs had to go alphanumeric with a different, longer format. Banks, healthcare providers, government agencies — it’s a huge problem.

We work with the largest financial services organization in Brazil, called Itaú, and they had a 2-year plan to become compliant with this change. It involved upgrading COBOL mainframes, upgrading processing systems. Conceptually it’s not complicated, but when you have thousands of different systems that all interact in complex ways, it gets messy. They were able to use Devin to get the bulk of that project done in 3 weeks instead of 2 years, then clean up the edges however they wanted. Seeing multi-year projects collapse to multi-week timelines has been really impressive.

Jordan Schneider: Is that where we are today — the really painful migration stuff where it’s transposing A to B in a more modern and functional way? Is that the current sweet spot for AI and software?

Russell Kaplan: Anything you can validate automatically is a sweet spot. Here’s an example of why I’m even working on Cognition. Before this, I was at Scale AI, which provides data to the frontier labs. We were doing labeling at scale with human experts saying which model response was better, providing reinforcement learning with human feedback. It kept getting harder because every human response needs to be smarter than the model’s own intuition to provide useful signal to make the models better. As models improve, that gets really hard to scale. We were finding PhDs in chemistry and true domain subject matter experts in every niche in the world trying to eke out better performance from these models.

In software, there’s a big difference — you can just run the code, compile it, test it. If it works or doesn’t, that’s signal you can use for reinforcement learning. Every application — whether government or private sector — where you can build an automatic feedback loop, that’s the key enabler to success. Migrations are a good example because you can build tests to say, how should the system behave? Does the new system behave the same way as the old one?

Jordan Schneider: Can we talk CVE (common vulnerabilities and exposures) mitigation for a second?

Russell Kaplan: A lot of people are worried about security and AI, and the worries are real. People are using AI in ways they haven’t before, and attackers are discovering vulnerabilities in really novel ways that would have been hard to do manually. But the defenders are now fighting back with AI too.

We have great existing tooling for scanning and detecting vulnerabilities via traditional static analysis — SonarQube, Veracode, Snyk — anything that can scan code and say, what’s my risk surface area? The problem that emerged a few years ago was that you’d run those scans and get thousands of alerts, sometimes tens of thousands, sometimes hundreds of thousands or even millions at really large organizations. Large organizations today have hundreds of thousands of open alerts saying “this might be insecure here.” That’s terrifying, but there just aren’t enough people to read all of those and staff the team to fix them. There are more problems than people.

What we’re seeing with Devin is that this is a really well-suited use case. You’ve got tons of alerts, it’s toilsome, and they need to be triaged — AI can do the triaging quite well. Some of the largest financial services firms in the world apply Devin to every single vulnerability caught in their entire codebase before it even goes to a human. Devin tries to auto-remediate, and right now we’re at roughly 70% fully automatic remediation — the code change suggested by Devin can be accepted and approved in one click, no changes needed. That should only go up as models keep getting better.

Jordan Schneider: This is an important point. You’re not going to make critical infrastructure — whether a bank or a power plant — resilient to the degree you want, especially when AI is attacking on the other side and the cost of getting into these systems is decreasing. Your power plant or water treatment plant has had 30 years to hire software engineers to clean up this stuff and just hasn’t. The only way we get to a world with stronger defenses is something way cheaper than what the alternative has been for the past few decades. It’s cool that we’re at that point.

Russell Kaplan: Those systems don’t even need to be vulnerable to automatic AI infiltration to be at risk. On the attacker side, humans working with AI has made attackers much stronger.

There was a vulnerability a few months ago called React2shell — a 10 out of 10 critical vulnerability. You could essentially remote control any server by sending the right network requests to a very popular library. The attacker who found this used AI tools. In fact, a product we offer called DeepWiki — our codebase intelligence product, which we give away for free for every open source repo — was used by a good Samaritan researcher to find issues in this codebase and unlock novel exploits. One of the hard parts of being a security researcher is wrapping your head around all the code inside an existing system. When AI makes it easier to ask questions about that code and summarize it, the attackers get a lot of leverage.

Jordan Schneider: Let’s talk about the “understanding the codebase” dynamic, both in your legacy corporate clients and the government ones. Why is that such a challenge to upgrading them?

Russell Kaplan: Right now these models have context windows in the million-token range. You can throw in a million tokens and reason about that correctly. But a lot of real-world production systems in enterprise and government are much larger. You can have individual codebases that are hundreds of millions or billions of lines of code, thousands of systems plugging together in different ways.

We talk about how human engineers still need to understand what we’re doing — I would argue no human engineer actually understands what’s happening inside a large organization at this point. The complexity has already escaped the constraints of one person’s brain. There’s too much stuff, too interconnected, too hard. The same reason it’s challenging for people is also challenging for AI systems, especially given current model limitations. In the coming years, models should get better at handling bigger and more complex code.

A lot of our research at Cognition has focused specifically on large-scale codebase understanding. How do you take every disparate system and look at it together, reasoning about it coherently? It’s actually a mixture of deep learning and graph algorithms — building a high-level graph of the relationships between different parts of code and different systems in an organization that scales much, much higher.

Jordan Schneider: How do we go from a million-token context window to something that can actually understand what’s going on in our complicated Brazilian bank?

Russell Kaplan: Right now, you need more than models alone. We always want underlying base models to get better, and we train our own specialized models for specific tasks, but models alone are insufficient for very large-scale codebase understanding.

What we’ve found is that if you index everything — throw billions of lines of code and many different systems into structured, machine-learned representations of the key similarities and differences across services and their relationships — you can build a graph data structure that interconnects how everything works in much higher detail. Then you still use LLMs when zooming into a specific area to say, how do these pieces fit together and solve a problem?

This is a really important point. In AI and software — and other AI domains too — it’s much easier to make a new thing from scratch than to make changes to an existing thing. To make changes, you first have to understand why the thing is the way it is. That “why” might be decades of historical context. Some of it’s documented in the code, some might be written in a Confluence page somewhere, some might be in one guy’s head who left the organization 5 years ago. You have this enormous history that we have to respect when making changes to real-world systems.

Jordan Schneider: Social Security is perhaps the paradigmatic example. No administration wants to do anything to stop those checks going out. That, plus the census data being so finicky, ended up enabling hundreds of billions of dollars of fraud during the pandemic because there wasn’t a more modern system that would allow visibility into where those checks were going. Thoughts on that in the government context?

Russell Kaplan: Sunlight is the best disinfectant. It’s great that the government is starting to put out public datasets and saying, “Community, go find the fraud — we’re not even going to find it ourselves.” We actually assigned Devin to the recent large dataset release from HHS to find the fraudulent patterns. Very quickly, you can tell this is a task well suited for AI. There are anomalous movements of money, patterns that don’t add up relative to the distribution. You’re going to see a lot more of that — both government agencies using AI internally to fight fraud and sharing data externally to leverage the full community.

Software for State Capacity

Jordan Schneider: What are some of the dream projects? Where do you really want to stick Devin in the coming years?

Russell Kaplan: State capacity matters a lot to me, both as a citizen and as someone interested in the well-being of the United States. It’s great to see what our country is capable of at its best, but also frustrating to see what it’s hindered by at its worst. The incentive structure of how the private sector helps government, the way contracting works, the resulting lock-in and stickiness of suboptimal systems for long periods of time — it’s really frustrating. It affects us every time we go to the DMV.

I would love to see a future of high state capacity for software, where there’s not a big gap between your experience using software with the government and your experience using software in every other aspect of your life. The bits power the atoms — our interaction with the physical world is increasingly governed by software systems.

One of the things we’re trying to do at Cognition for Government is empower every agency to get where they want to go. It starts with modernization, which is the bottleneck for a lot of these problems. We work with a ton of agencies at this point — the Army, the Navy, the Treasury, NASA JPL. We have dozens of FedRAMP deployments now, and we’re just getting started. I’m really excited to help level the playing field between public sector and private sector.

Jordan Schneider: How has the experience been putting Devin in government versus financial systems or other enterprise companies?

Russell Kaplan: There are more parallels than you might expect. The largest health insurers in the world are also very sensitive to regulation and security. They also have enormously complex systems. There are actually more similarities than differences, which is one reason we decided relatively early in our company’s journey to go help the government too. It’s not a completely different set of problems. You have to work with your counterparties in different ways, but the underlying problems are pretty similar.

Jordan Schneider: What about if we’re talking about Stripe or Notion or some Silicon Valley firm?

Russell Kaplan: The Silicon Valley tech-native startups are really different. There’s a spectrum of buy versus build. What’s special about Silicon Valley is that companies are building things themselves — constantly shipping new things, making their own agents, reinventing themselves. Then you have companies whose core focus is not software. Their core focus is solving some other set of problems for their customers, citizens, or stakeholders, and software is just a tool to get the job done.

Historically, those non-native software organizations have been reliant on software vendors to bring them tools. If you play forward what’s going to happen with AI and software engineering, every company, every organization, every government agency is going to be in much greater control of its own destiny. Right now, software creation is extremely constrained. Everyone needs more engineering capacity than they have. The roadmap is long, things get cut and descoped all the time. That’s going to start to flip. The result might be that every company has the capabilities of a software company.

Jordan Schneider: What does the software-engineering-starved healthcare provider or federal bureaucracy actually need in order to taste the fruits of that future, besides a good procurement process for a little Devin?

Russell Kaplan: You joke about procurement, but the procurement process is actually one of the first beneficiaries of software abundance. People are talking about the “SaaS-pocalypse” right now — some aren’t joking. Some companies’ stocks are down 30% on this concept. The idea is overblown in some ways because we’re not all going to vibe code our own systems of record tomorrow. But the leverage has flipped, and procurement organizations are seeing the benefits.

One of our large Fortune 500 clients actually instituted a new procurement process with Devin. Before they buy any other software, they first prompt Devin to try to build the application. Devin isn’t going to one-shot build a giant company’s application in one go, but you can get a prototype. The procurement team then goes to the software vendor and says, “We want a discount.” It’s an effective negotiating tactic, and people are already getting discounts from this. In at least one case, it was an infrastructure provider, and the firm decided to actually build it internally because it wasn’t that hard and the prototype worked.

This is already happening in Q1 2026. It’s going to put pressure on software vendors to deliver value. That’s what I’m personally really excited about — less rent-seeking, more product quality.

Jordan Schneider: I also wonder about the question of how many really good people you need to get to “passable.” For the past decade or so we’ve had Code for America and various rotate-into-government-for-2-years programs. On the one hand, they do good work. On the other, maybe they make a nice frontend or fix one problem. But the ability for that one person to fix 10 or 50 problems in a 2-year cycle — these tools are going to give those folks a lot more leverage.

Russell Kaplan: We see that all the time. One of the fun things about software is that basically everyone always wants more of it. If you’re an individual engineer, you can ship a lot more than you used to, and you’re more empowered cross-functionally. You can get help with your designs from your agent, help scoping the product roadmap, help with integrations. Every person traditionally involved in building software is more empowered to have more ownership of the outcomes they’re driving. The product manager feels it too — “I can prototype this without the engineer or the designer.” The designer says, “I can build and scope this without either of them.”

The result is that you can get a lot more done with smaller teams, but organizations are also getting a lot more ambitious. The bulk of the change happening right now is people taking the productivity gains and asking, what more can we ship? What more can we pull in on the roadmap?

Jordan Schneider: From a policy perspective — and this is a drum I beat a lot — you need to use these tools even if you’re not a software engineer, because the possibility space of what you can do from a policy perspective is going to expand dramatically. The idea I came up with was dynamic pricing for the FAA to manage drone corridors — delivering packages, taking your kid home from daycare, whatever. Surge pricing for my daycare VTOLs. But that’s a big demand on software. In New York City right now we have this incredibly dumb version of surge pricing. It wasn’t necessarily because the software was complicated, but you can just have more creative, dynamic things because it will no longer be impossible to do what the equivalent of 10 FTEs building you a thing in 2024 or 2025 would have required. I’m excited for people to use their imagination when it comes to how to use this stuff better.

Russell Kaplan: For policymakers, it’s useful to implement your own policy ideas with these tools, but it’s also really important to build the mental model of what’s possible and what’s not. That mental model changes every month.

One of the greatest harms we did in generative AI was shipping Google’s auto-generated answers at the same time ChatGPT Pro existed. A lot of people were running a Google query on a cheap model served for free and thinking, “This AI answer is not very good.” Meanwhile, the $200 a month ChatGPT Pro subscription might give you research-grade quality. People were building very inaccurate mental models of what these systems are capable of. Everyone’s guilty of it, including people working on the tools. If you’re building the tools and not constantly testing the frontier, your mental model goes out of date really quickly.

Jordan Schneider: Not to give away your evals, but what are you hoping to see in the next few years?

Russell Kaplan: We’re heading to a world where building software is already no longer really about coding. Writing the code is not the bottleneck anymore — it’s everything around it. Humans still have to understand the code we’re putting into production, and the emerging bottleneck is actually review. We launched a product a month ago called Devin Review, a very human-centric interface for understanding increasingly AI-generated code. People are making changes that are thousands of lines long. The volume of code is growing enormously.

Where we are right now, Q1 2026, you’ve still got to understand the code you put into production. By 2028, that will no longer be true. We’ll have much broader specifications of systems — something more like writing a spec in English, and AI compiles the English spec down to software. But through 2026 and probably most of 2027, we’re still going to be looking at code, trying to understand it, and we’re not yet at the level of reliability where you can fully automate these things.

It reminds me a lot of self-driving. When I was at Tesla on the Autopilot team, working on the vision neural network — when you get to 99.9% reliability, a lot of drivers start really trusting the system because it works 999 out of every 1,000 times. That 1 in 1,000 where you have to take over, people pay less attention. We’re in that uncanny valley phase of AI software engineering where it works so well that you might be too trusting of it, but you’ve still got to understand what you’re doing.

Jordan Schneider: You mentioned the self-driving form factor earlier — at Level 5, you take a nap. That’s the clear end state. How do you think about what the next interaction paradigm is going to be?

Russell Kaplan: Self-driving is interesting because Level 5 is you take a nap, but that’s the limit — you still decided where you want to go. In software, there might be a Level 6, where you don’t even decide where you want to go. Maybe you have some very high-level objective for what you want to accomplish, but Level 6 autonomy means the AI agent actually decides the details of what to build in the first place. The level of abstraction people will operate on is going to grow really high, really unexpectedly fast. If you specify a business objective or an outcome you want, increasingly we’re going to be able to optimize against that objective directly.

Jordan Schneider: That’s funny, because that’s actually where I feel the limits most — the first question, idea generation, what direction to take some vague thing I have. The execution, the research, finding random stuff on the internet, building the MVP — that it can take care of. But can a model come up with the policy idea that fits into all the constraints we’re living in, or the right episode topic?

Russell Kaplan: Right now, it’s all about asking the right questions. That’s the key skill of using models — what question are you asking? What task are you trying to do? That’s a distinctly human activity that’s going to remain human for a long time. Even the way we’ve structured our society as a democracy — ultimately, we as people are in charge of what we want, the structure of society we want, how we want to push forward. These things are tools ultimately, tools for the betterment of society, but they’re getting much more capable and much more autonomous all the time.

Jordan Schneider: When you’re working with clients and your forward-deployed engineers, are they often squinting around saying, “You thought you wanted us to do A, but B and C is also something these models are capable of”? How much do you see Cognition serving the role of AI-to-problem-finder?

Russell Kaplan: That’s an area we help with a lot right now. Usually customers understand their problems, but they don’t necessarily have the best mental model of exactly the full universe of problems addressable with AI today. What’s really interesting about Devin and agents in general is that once you’re plugged into the code, you can see all the problems. The problem discovery process that used to take lots of conversations is getting increasingly automated — whether it’s the security vulnerabilities we talked about or something else.

A typical engagement for us — a government organization or large enterprise comes in and says they have 3 outcomes they want to achieve with AI. “We’re going to modernize this legacy system in weeks instead of years.” “We need to build this new capability as fast as possible and it’s going to grow our business by this much.” “We need to structurally improve our testing coverage, validation, and security posture — here are the metrics.”

What we find inside each organization is a really wide distribution of how much people are leaning into next-generation tools. In every organization — it doesn’t matter if it’s the most legacy, old-school organization in the world — some people are excited about the future and want to try new things. Consistently, 100% of the time. Those people are more empowered than ever to have extraordinary impact. There are also folks who’ve been doing it one way for 30 years and are super skeptical. The evidence is increasingly growing that it might be worth taking a peek.

Jobs, Talent, and Cognition for Government

Jordan Schneider: What are your calls to action? Who are you hiring for? What kind of conversations do you want to have coming out of this?

Russell Kaplan: We’re hiring a lot in Cognition for Government right now for folks who have been on the ground and seen the problems firsthand. Our forward-deployed engineering organization is maybe the fastest growing of all the roles.

People ask what the future of software engineering looks like. It might look like you always have to understand the problems of your customer, because writing code is getting easier and easier. If you look at our core research and engineering product team versus engineers who wear multiple hats — interacting with customers, shaping the product — the latter is growing much faster. In the limit, we all might be working directly with other people in some capacity.

We’re also growing what we call engagement management, because these projects are very rarely just about the software — it’s about the end-to-end organizational problems you’ve got to solve. We have classified deployments, we work in secret networks, so folks with the right clearances and backgrounds are always interesting. We’re really just scratching the surface of how much this is going to change.

Jordan Schneider: You also have some family lore to share.

Russell Kaplan: You were asking me why I was so interested in the 1890 census and how we popularized punch cards. My grandmother was one of the first female programmers in the country, back when it was a very arcane activity of messing with punch cards. Later, when assembly came out, she was super excited about that. She gave me a lot of crap growing up that we had it so easy in the 2020s — writing code with a computer you could edit, where you didn’t have to worry about dropping things.

Her master’s thesis was on the knapsack problem, and that line of research ended up being really useful in the Apollo missions. Part of my hope for Cognition for Government is that we can go full circle and help bring the government back to where it once was — the true leader in technology.

Jordan Schneider: What does she think about Devin?

Russell Kaplan: Unfortunately, she passed away a few years ago, before Devin came out. But I think she would look at it and be proud. I think she would be happy.

Jordan Schneider: It’s interesting how the genders flipped in software engineering — in the first few decades it was a very female-coded field, and then that changed. I wonder if all the AI tools are going to help it flip back. If the type of skills that get prioritized rearranges what the labor market looks like, you might not see the gender split that’s dominated for the past few decades.

Russell Kaplan: At a minimum, it’s going to be so accessible so early in your life to learn and use these tools that you might start building applications with AI before you even know what the concept of a gender norm is. Software will be like water, just flowing everywhere. It’s going to be a really fun time to be a builder.

Jordan Schneider: First, she’s got to learn how to speak, but maybe we’ll give my daughter 6 more months. Awesome, Russell. Thank you for that.

Frank Kendall served as the 26th Secretary of the Air Force from 2021 to 2025. Before that he was Under Secretary of Defense for Acquisition, Technology and Logistics under Obama. His new book, Lethal Autonomy: The Future of Warfare, comes out in June. He joined Second Breakfast on March 6th, six days into the US-Israel campaign against Iran.

This transcript has been edited for length and clarity.

In this conversation:

• Why the Iran campaign has already hit the limits of air power — and what the Scud hunt of 1991 tells us about mobile missile hunting today

• Interceptor stockpiles, shot doctrine, and the Patriot/THAAD production crunch

• Why this conflict is the wrong war to learn lessons from for a China fight

• The third offset strategy, range-quantity-autonomy, and what we still haven’t built

• Why defense tech hype keeps failing: “Nothing is fielded in the United States military until a service wants to buy it. Period.”

• Sunk costs, the JROC as parochial protection racket, and what breaking up AT&L actually cost

• The Anthropic-DOD standoff: what the contract dispute is really about, and why the supply chain risk designation is an abuse of power

Listen now on your favorite podcast app.

Iran as a DIB Stress Test

Jordan: What themes has the first week of this conflict illustrated about the state and potential future of the defense industrial base?

Frank Kendall: Ages ago, Don Rumsfeld said you go to war with the force you have — something to that effect. That’s generally the case. You stockpile ahead of time. If you’re in a long conflict, of course, you can order things. Ukraine has been dealing with a situation where they’ve had to adapt to very significant changes in warfare very quickly.

Basically, the situation we have is a force that’s spread around the world. It’s very large and has an enormous amount of capability, but it does have finite stocks of some things. The war has gone pretty much as I would have expected. We achieved some degree of surprise. We were able to take out a lot of the higher-value targets, including, of course, the leadership immediately. In the first few days, we prosecuted targets that were generally fixed targets that we knew about ahead of time and could plan for.

We’re moving into a very different phase right now. The leadership has been alerted, the country’s been alerted. They’ve distributed their assets as much as they can. Some of them are hardened, some are just concealed. There may be decoys out there. We’re now in a more difficult phase where we’re going to be focusing more on tactical targets.

There’s an open question in my mind as to how much we should or will go after economic targets — things that are part of the infrastructure. It looks like we’re doing some of that now too. We’re certainly going after the industrial base that supports their military.

The things that we would worry a little bit about in terms of quantities are, first of all, the precision longer-range standoff munitions, which are pretty expensive. They’re pretty exquisite devices — very specialized, built by our industrial primes that have a lot of experience doing exactly that kind of product because that’s what we’ve demanded of them.

As we get into this, using those against a target you think is a truck that might be carrying a missile or an individual shelter gets kind of expensive. You want to shift to the shorter-range, less sophisticated, and much less expensive weapons like JDAMs — Joint Direct Attack Munitions. It’s a GPS-guided bomb. We have a lot of those and they’re relatively cheap, so we can keep this up for quite a long time.

But the target set is now distributed into much less valuable items. If we have great intelligence, we may be able to find out where some of the leadership is and still go after that. But we’re going to be dependent upon really good intelligence to be able to do that.

Anyway, we’re now in a situation which could endure. It depends a lot on what the political situation is in Iran. How prepared they are to cut a deal that Donald Trump will accept. My guess is he would accept a deal that basically he can state, at least, meets some of his objectives. He does not want a long war here. He campaigned on not getting us into or having long wars. Both sides are highly motivated to bring this to an end. But the Iranians can keep this going for a while if they choose to. There could also be a popular uprising, and we could have an issue there.

I don’t see our industrial base having a big problem with that. The president’s going to have a meeting with CEOs today, as a matter of fact, and he’ll encourage them to go faster. There’s only so much they can do. Some of the new entrants have claimed a lot of flexibility and ability to do things very agilely. I don’t think that’s on the kind of time scale we’re talking about here. We’re talking about months, at least, and for the major, more sophisticated weapons, it’s a couple of years lead time.

For less expensive ones, we can cut that down to a few months probably, assuming the supply chain can support you. It’s not just the primes, of course. It’s all the things that go into a weapon that have to be built and assembled to put it together.

Jordan: I want to come back to the idea of going from more strategic to tactical targets because you’ve run out of the most juicy stuff to blow up. Even if things go great, we’re going to hit the limits of air power pretty soon.

Frank Kendall: We’re hitting them.

I was in the Pentagon. I was a deputy director of defense research and engineering for tactical warfare programs 30-odd years ago for the first Gulf War. We couldn’t find Scuds. I don’t know that there’s a single engagement where we successfully found a Scud on a mobile launcher and killed it before it was able to launch.

The fundamentals of that really haven’t changed. A truck’s a truck, right? And you can keep it so it’s not observable. Bring it out when you think there’s no airplanes around, when you have some confidence because your own sensors show there’s no airplanes around. Get a launch off and then hide it again.

We’re going to suppress this threat, and we are. I haven’t seen any good numbers on how many launches per day, but they’re still getting off a mix of ballistic missiles and UASs and maybe some cruise missiles even. The volume of fire they can generate is not decisive. I refer to it more as harassing fire, and that’s kind of what it is. It’s going to inflict some casualties, it’s going to do some damage, but it’s not militarily significant.

We’re doing something on the other side of that coin, which is hunting things and killing relatively low-value targets. That’s not necessarily going to break the back of the Iranian military.

The economy, on the other hand — we can bring their economy down pretty effectively. We can stop some of the services. Internet’s off, I think, already. I’m not sure where power is in general. Transportation networks, things like that. That’s going to hurt the Iranian people. And it may be another impetus for them to rise up and do something about the government. I don’t know how much appetite the country has to absorb that kind of punishment. It’s not a popular government, and we just saw that, but it’s also a ruthless one. They have the weapons and the will to put down any kind of unrest.

The other side of the coin is hard to predict too, because nobody in the Persian Gulf right now is enjoying the fact that weapons are coming into their country and attacking them. It’s in everybody’s interest to get this over with and finish it somehow. But both sides have the capacity and capability to continue for quite a long period of time.

Justin: The Iranians proved from 1980 to 1988 that they would persist. Qatar has already announced they’re shutting off production because they can’t ship oil out. There are substantial economic impacts that Iran can inflict on the Arab states just by continuing the fight.

Frank Kendall: That’s a hugely important part of the political question on our side. If the Straits are effectively closed and production is going down in general, gas prices are going to rise very quickly. That’s a pretty responsive market when things change. Donald Trump campaigned on gas prices and was just bragging about them, so he’d better be careful about what he says here. That will put a lot of pressure on the administration to bring this to a conclusion as well.

Interceptor Stocks and Shot Doctrine

Justin: When you’re talking about the defense industrial base and the interceptors we’re using against Shahed drones and ballistic missiles — given lead times, do you think the primes are going to start increasing production? Or are we going to get down close to zero?

Frank Kendall: That would be our biggest concern, I think. Interceptors like Patriot and THAAD, for example, or even Standard missiles — there’s a pretty significant lead time to build those. I used to be the chief engineer for Raytheon, so I know exactly what that’s like.

They will ramp up, but we’re going to pay them to do that, obviously. However, there’s a lot of lead time. It goes back to the entire supply chain — the people building elements of the sensors, the sensors themselves, specific components, solid rocket motors, all the things that go into those missiles.

We’ve got a reasonable stockpile of those. We can do this for a while, but we’ve already been maximizing those production lines to support Ukraine. Those are some of the same systems that Ukraine needs as much as they can get. We’ve tried to field some lower-cost alternatives. We’ve brought in our allies and partners to support Ukraine as well with some of their systems, particularly some of the shorter-range systems.

I don’t see any kind of crisis here, but I think at some point not too far down the road, we’ll have to change our shot doctrine. We’ll take one shot instead of two. We’ll watch where things seem to be headed, and if they’re going somewhere we don’t care about very much, we’ll let them go. It’s called preferential defense.

We’ll do some things tactically to try to adjust. As we’re suppressing the numbers of threats, that helps too, of course. We’ve got to work this entire equation — the whole kill chain, all parts of it — to try to get the threats down as much as we can.

One thing we can perhaps accelerate is some electronic warfare capability, which is relatively inexpensive and potentially allows us to more quickly field some prototype capabilities that can help deal with some of these threats. But it depends a lot on whether there’s even a vulnerability there. Is there a seeker that’s vulnerable that emits radiation?

This can go on for a while — that’s really my point. Both sides are going to be stressed and have difficulties delivering or defending as it goes on further.

The China Problem: Are We Learning the Wrong Lessons?

Bryan: Do we risk learning the wrong lessons from this confrontation? We’re up against a country with no air defenses and no industrial base. The takeaway could be: we just need to build up more mass, a larger stockpile of the same old stuff. Then we go up against China, they’ve got countermeasures, and now we’ve built up a stockpile of stuff that turns out, like Excalibur, to be obsolescent.

Frank Kendall: Great point, Bryan. I have watched over the last 20 or 30 years the US try to focus on the Pacific multiple times, and every single time we get pulled into the Middle East and some mess in the Middle East. There’s more violence there ongoing year after year than anywhere else in the world. We also, of course, have Ukraine, which has been an aberration, right? It’s the first time Russia’s invaded anybody since Afghanistan.

You’re right. We talk a lot about our combat experience. It’s largely been counterterrorism and things like this. We can put together an air package. We did this 30-some years ago. We can do it very well. We can go in and service all the fixed targets that we can identify that we think matter.

That’s not the China problem. The China problem is a fleet and an air force basically that’s supporting it, and a lot of long-range rockets coming out of China, coming against our bases, coming against our adversaries, and a much, much more formidable air-to-air set of capabilities than Iran or anybody else has, quite frankly.

This is not — this is another diversion. It is another type of conflict which we’re very good at. We have enormous capability to do this sort of thing, but it’s not the fight we can expect in the future. We’re waging it, interestingly — the F-35 is very much an element here and so on. But most of the forces we’re employing are the types of forces we’ve had forever.

The point of my book that was mentioned earlier is that we’re moving to an age in which automated forces, automated weapon systems are going to be the norm. We’ve got to win a race with China to make that transition as quickly as we can. I couldn’t say we were winning right now.

We’re close. We’re close to each other. It’s going to be as much about culture change and will as it is about the technology and the ability to exploit the technology. I’m nervous about that. I’m afraid that China will be more open-minded than we are, more willing to make more significant changes. As a result of that, they’ll make commitments to move faster and steal a march on us.

Bryan: There’s no way we’re going to outmass China. We’re going to be the away team up against the world’s largest manufacturing power. We’ve got to think about how we would circumvent what they do, and that’s going to require an industrial base that’s able to adapt rather than just stockpile stuff.

Frank Kendall: We have to make good decisions about what we buy. Going fast in the wrong direction doesn’t get you anywhere you want to go — and it wastes time and money. Time is probably our most precious asset. We need to take the time upfront to think carefully about what we should be buying and then go get that. That’s the point of my book, actually.

The book is about fulfilling what Bob Work, when he was Deputy Secretary of Defense, tried to do with what he called the third offset strategy. He felt that what we needed to do was another round of modernization — a dramatic improvement, a generational improvement over what we had, as opposed to just an evolutionary approach of getting the next thing that’s better than the one you already have, which has been our traditional route for the last few decades.

When I worked with Bob on that, we never finished the job. He basically came out and said, “It’s going to be about robots. It’s going to be about robotics.” And I said, “Well, that’s fine, but that doesn’t tell you what to build. It just gives you an idea.”

The team that he had working on it — myself, Steve Welby, Arati Prabhakar from DARPA, Craig Fields from the Defense Science Board, and Jimmy MacStravic from my Acquisition Office — came up with a formulation that was range, quantity at cost, and autonomy. That mix of things: the ability to operate further away, field things that weren’t exquisitely expensive that you can only afford in small numbers, and introduce automation. I still think that’s true, and I think it’s true in all domains generally.

The book lays all that out. It talks about what we would actually do in each of those areas. I know it’s not the final answer. I’m sure there are a lot of things that are wrong in there, but at least it gives us something to think about moving in that direction.

We’re in a race. I’ve been worried about China since 2010 when I came back in after being out of government for 15 years and saw what they were doing to modernize. They’re a formidable opponent — much more formidable, I think, than even the Soviet Union was. And now we’re off dropping JDAMs in the Middle East again.

Why Defense Tech Hype Keeps Failing

Justin: There’s a lot of talk about the Luckeys and the success that Anduril is having. Why are we not hearing about our defense tech companies that are going to revolutionize warfare and their contributions in this fight?

Frank Kendall: I don’t know. There’s been a lot of hype there. There’s also a lot of bashing of the traditional industrial base, which I think is not warranted. The point is that we get the products we ask for. The problem isn’t the industrial base; it’s the customer. If you tell the suppliers, “I want an F-47,” they’re going to build you an F-47. If you tell them you want a CCA, they’re going to build that. They can build different kinds of products — you just have to tell them what you want. It’s not like the commercial world where the industry comes up with products on their own and says, “Hey, do you want one of these?” It doesn’t work that way. The bottom line is if we want things that are cheaper, simpler, and easier to build, we’ve got to demand that. We’ve got to tell people exactly what we want.

Some companies have been building their own prototypes with the idea that “I’ll build it and you’ll see how wonderful it is, then you’ll buy it.” That has not worked very well so far. And it’s not the first time. I used to do venture capital work in this area where you’d have what you thought was a great, interesting thing operationally, but it never made it onto the priority list.

The reality is the services don’t have enough money for the things they already know they want. They’ve got a long list of unfunded priorities that they’d love to have money for. Buying something that’s not even on that list is hard. Getting them to do that is really hard.

The most important thing I tell people on the Hill — and I tell people in OSD this — is that nothing is fielded in the United States military until a service wants to buy it. Period. Even if you have political control for a while and you can force things on a service for a while, as soon as you’re gone, if they don’t want it, they’re not going to buy it. I’ve had this happen to me personally more times than I can count, going back to the 80s and 90s.

The services are enduring institutions. They have enduring priorities. You really have to bring them along. If they’re not fully involved at the senior level, and they don’t culturally accept what you’re trying to do, it’s not going to happen. You’re going to spend money on it and then it’s going to die.

People have to be much more aware of that. Trying to circumvent that system doesn’t work.

The DIU has been around for about 12 years or so now. I’m not aware of a lot that’s come out of DIU that’s gotten fielded. But yet there are a lot of people very enamored of that idea that if we give them another billion dollars a year, miracles will happen.

Eric: What’s actually the mission of DIU as opposed to DARPA, AFWERX, Spacewerx, DefenseWerx, SOFWerx? At some point does somebody’s heart have to get broken? Right now we just have a series of false pretenders to the throne — everybody with a billion-dollar budget claiming to lead technological development for the department, not necessarily leading to superior results on the battlefield.

Frank Kendall: They’ve pretty much done away with the OSD reviews of new programs — things we used to do routinely, which I thought had a lot of benefit. What shocked me when I came back in 2010, among other things, was the amount of major decisions about new concepts, new designs, and new programs we were making by the seat of our pants. A four-star would say, “I want that,” and off we’d go. We’d spend billions of dollars. I was shocked to see that. It didn’t mean we were going in a terrible direction, but we weren’t necessarily going in the best direction.

When I was running the Air Force, one of the things I did for the Department of the Air Force was try to create — this is part of the set of initiatives I called Reoptimizing for Great Power Competition — create an ecosystem, if you will. Get the technologists and the operators to work together in partnership. Force the analyst into the room so they can do the operational analysis of different options and lay out the data that would help people decide whether it’s the right idea to do something or not.

I had done an awful lot of that in an ad hoc way when I was Secretary because I didn’t have that institutional structure in place to do it, and people didn’t have the missions necessary to do it as inherent missions. We were fragmented. And frankly, we’d been superior for 30-some years. We had assumed dominance ever since the first Gulf War. I was watching it slip away as China was trying to modernize very effectively and very aggressively.

What I’m seeing all of our services do is figure out how to take the stuff they already have and add unmanned systems to it as an adjunct. I did that in a way with the CCAs in the Air Force too, but I shifted the mass to the CCAs. The concept there is a fighter is going to control several CCAs, not that I’m going to have a fighter with one CCA that is his buddy and helps him. We’re going to have to be much more open-minded about how significant the changes these new systems are going to enable and eventually require on the battlefield. But we’re not there yet.

The Ukrainians have a dashboard for their UAS brigades. Basically, they’re keeping score of how they’re all doing at killing Russians — they post fairly often how many Russians they killed last week, and they’re in competition with each other. What fascinated me about that wasn’t the competition aspect. It was that they’re talking about UAS brigades. Is the US Army talking about a UAS brigade? It is not.

Eric: The Army is shutting down its division cavalry squadrons — rather than converting from attack aviation to UAS, they’re just unflagging them.

Frank Kendall: There you go.

Acquisition Dysfunction: Sunk Costs, JROC, and the Goldwater-Nichols Deal

Justin: How much of an issue is the sunk cost fallacy — with appropriators, legislators, and within leadership?

Frank Kendall: A lot of the appropriators really hate change. They hate disruption. I’m thinking of some in particular — I may be generalizing too much here — but what they don’t like is having to go back to the people they work for and say, “This thing I got you to fund last year isn’t gonna happen now; we’re doing something else.” They really don’t like to do that.

Because of that, they tend to want to force the services to continue doing things they were doing. There’s also political support for things. Once a program gets established, it’s got a constituency, even before there’s a downside.

I had a conversation with the CEO about a month ago about a program that I had tried to cancel. They were able to go around behind me and go to the Hill and keep it funded. It’s a political system — that’s part of the political system, I guess — but it’s not what the nation needs. It’s a diversion of resources to something that shouldn’t be as high a priority as some contractor wants it to be.

There’s a reluctance to admit you made a mistake. I’ve seen political leaders come in who are really happy to kill somebody else’s program that somebody else started. They don’t want to kill the one they started. Dick Cheney killed the A-12 a long time ago. Gates killed a few programs — cut back the new bomber for the Air Force, for example. Cheney killed a few once upon a time when he came in. It was the end of the Cold War.

The JROC, the Joint Requirements Oversight Council — for all of my experience with it, and a lot of people tried very hard to make it effective — was largely a collection of people from the different services there to defend their services’ interests. It’s a committee of people who are in the room not to figure out the best answer, but to make sure that nothing bad happens to their service. Essentially, all those services agree with each other’s requirements all the time.

We started out with a fairly short process to do that, but after 10 or 15 years, it became a year-and-a-half process. People had to go through this enormous bureaucracy to get approval of a requirement that was going to be approved no matter what.

That’s gone now, and I’m not sure what’s going to replace it. The Joint Staff should be focusing on things that have joint impact. It should have people who are independent enough of the services to look at them objectively without just trying to protect parochial service interests.

This is an idea of some kind of general staff — people who are joint. They start in a service, and then at some point they transition and become joint for life. They’re no longer tied to their original service; they’re allowed to think independently and to be more creative and open-minded. That idea has never gotten any traction for reasons that are pretty obvious.

Congress made a big mistake when it broke up AT&L. That’s generally perceived to be the case right now. You don’t have a single person in charge of the entire lifecycle of products and thinking about the planning for the entire lifecycle — from the beginning all the way through.

The ability to have open dialogue with industry has largely been pushed aside by ethics rules. It’s much harder to do that now. People are nervous about talking to industry, when we should be talking to industry all the time. When problems came up in the early 1980s at the height of the Cold War, we would get a room full of the smartest people we could find, regardless of where they came from — from industry, national labs, service laboratories, and operational commands. You put those people with that mix of expertise in the room and try to figure out what you should do, what options you should consider, and then analyze them. The ability to have those kinds of communications and open dialogue has largely been pushed aside by ethics rules. It really slows us down and prevents us from getting good ideas as quickly as we can.

Now, with all the newer technologies coming in — automation in particular, and various forms of AI — it’s particularly important to bring that in because it’s changing so dynamically. We need some fairly significant reforms, but they’re not the types of things that people are generally talking about. Redoing 5000.02 is not going to solve the problem.

Bryan: The point you’re making argues against the traditional model of needing to do some long analytic process to figure out what we need 15 or 20 years out. If the technology is widely available and changing rapidly, that doesn’t make sense anymore.

Frank Kendall: You’re right, but technology tends to come in waves. You get a surge for a while with a breakthrough technology — the semiconductor, for example. Large language models might be in that category too. You get a breakthrough technology, and then you get a period of adaptation. The people who have very deep understanding of a specific area — PhD level understanding — will come up with some breakthrough new thing. Then all the people who may not have that depth, but are creative in other ways and have broad knowledge, start to apply it in very creative ways. That’s what’s happening now with LLMs.

There are waves like that you have to catch, and then you have to figure out how to ride them. You need mechanisms that can effectively react to change quickly.

But just doing something fast isn’t the answer. You can have models, simulations, and tools available, and you can have teams of people available who do this for a living. One of the major changes I was trying to make in the Department of the Air Force was to create those teams. When I arrived, I found that I had a number of operational problems I wanted to solve — operational imperatives, as I called them. There were seven of them. I laid those out and said, “Okay, I need teams to go address each of these problems.” There was no organization in the Department of the Air Force that I could turn to and say, “You have to go solve this — that’s your mission.”

I had to create ad hoc teams. I brought Tim Grayson in from DARPA and found smart people in uniform — technology people as well as operational people who were relevant to the problem. These included general officers at the one-star and two-star level. I put them in charge of each of the seven teams as co-leads, and they formed groups and off we went.

It was very ad hoc and not something the establishment knew how to do or was prepared to do. I also took the Operations Analysis Shop that had been sitting in the A9 under the Chief of Staff of the Air Force — basically as part of the Air Staff — and elevated it up to the Secretary level. I said, “You are now the Department of the Air Force Studies and Analysis shop. You’re going to own all this analysis, but you also own developing capability to do this analysis — creating the models, creating the simulations, and bringing up the career field.”

I spent the first couple of years in the job putting together all the different pieces. Then I said, “Okay, we need to institutionalize this. We’re in a long-term strategic competition with China. We need to set up the structure of the Air Force so that we can do this all the time.”

What I was trying to create was a structure that would facilitate the type of agility we’re talking about. It has to be as cutting-edge as possible. You need people who are steeped in the technology and thinking carefully about its application to operations from both sides of the house. They can educate each other, learn from each other, and explore things together. They try things, and you get much better solutions out of that.

They also need to be open-minded. They need to be able to accept that things may change very fundamentally now — not just incrementally, but very fundamentally. I don’t think we’re quite ready for that yet.

The Anthropic Situation

Jordan: Do you have any broader takeaways on the Anthropic drama of the past few weeks?

Frank Kendall: No, what I’ve been trying to tell people — there’s a tendency to look at these things and see them as a morality play. It’s not that simple. Anthropic wants to do business with the DOD. They’ve got a pretty good product. OpenAI wants to do business with the DOD. They’re both nervous about how the government might use their technology, justifiably so. And frankly, from my point of view, particularly for this administration.

They have concerns. Anthropic was trying to address those concerns through contract language that would have bound the government. The government didn’t want to do that, and I’m sympathetic to that point of view. The two sticking points were broad area surveillance of Americans and completely autonomous lethality with no human in the loop.

Preventing those things from happening is good. But there are already laws and policies that prohibit them. The way for us as a country to address these issues isn’t through contracts with individual firms. From the government side, you can’t have terms like that in every contract you write. It would be a nightmare trying to administer it. How do you stay compliant with all that? The government does try to fulfill its contracts, for the most part.

That’s just not the right approach. If you think your customer is going to use your product maliciously, you shouldn’t sell it to them. You put safety warnings on things all the time. That’s closer conceptually to the approach OpenAI is taking. They want a list of things that the government is agreeing not to do, but they don’t want it as a contractually binding requirement of the contract.

I should be very careful about that because I haven’t read all the language — some of it is available. OpenAI put out some of theirs. But unless you sit down with the actual contract and read it, you don’t know what’s in it and you don’t know exactly what the constraint is. I reserve judgment on how big a difference there is between the two.

I’ve heard about personality conflicts that might be a factor here, where people just don’t like each other and don’t want to work with each other. I don’t know if that’s true or not. What we should be doing is figuring out how to regulate AI in a meaningful way that doesn’t slow us down dramatically or create a huge amount of meaningless bureaucracy. That’s a tricky thing to do.

That ball needs to get set in motion by Congress. Congress can’t do it itself — as I mentioned earlier, the expertise isn’t there and it’s too complicated. We’re going to need some kind of regulatory framework and people who really understand it. Hopefully, we can work cooperatively with industry to do things that we all should want to have happen. Right now, the administration is taking a position of no regulation at all, and it’s attacking states that are trying to implement some regulations at the state level. That’s not the answer either.

We need something in between. We may need a new agency dedicated to this kind of expertise, or we could do it through some existing agencies or some combination. Doing nothing is not the right answer, and trying to do it through individual contracts isn’t the right answer either.

The one point I do want to make — and I should end with this — is that what the government is doing to Anthropic is outrageous. It is trying to destroy a company because it couldn’t get a contract agreement with them. That is not the way the government should operate. It’s an abuse of power.

The supply chain risk designation has nothing to do with what Anthropic is doing. It’s just a way to punish them for not agreeing to what the government wants. That’s not how Americans should want our government to operate.

Unfortunately, it’s a feature of this administration that it uses whatever tools in the toolbox to attack those who disagree or won’t do what it wants, whether it’s a law firm, a university, or a corporation. We shouldn’t tolerate that. That’s not the way we want our government to work.

Frank Kendall’s book Lethal Autonomy: The Future of Warfare comes out in June.

The Anthropic–Pentagon blowup generated enormous heat and almost no light.

Michael Horowitz has thought as much about autonomous weapons policy as anyone. He’s a professor at Penn who spent time in Biden’s DoD overseeing the office that rewrote DoD Directive 3000.09, the Pentagon's overarching framework for autonomous weapons. He joined me to do a proper 101: what autonomous weapons actually are, how the relevant law works, what Ukraine has taught us, and where the genuine risks lie — which turns out to be less about killer drones and more about generals over-trusting their dashboards.

Listen now on your favorite podcast app.

What Does an “Autonomous Weapon” Actually Mean?

Jordan Schneider: How would you characterize where the fear lies in the well-meaning researcher or head of an AI lab who thinks their technology used for certain types of autonomy would be a bad direction to go? Maybe contrast that with how this stuff is used today in Ukraine and Iran.

Michael Horowitz: The average Silicon Valley AI safety researcher who’s worried about autonomous war bots is probably worried about AI making the decision about who lives and who dies. They think that’s some dystopia they don’t want any part of.

They get worried about the incorporation of AI into the pointy end of the spear for militaries, especially when it comes to potentially selecting and engaging targets. What sometimes gets lost in the conversation is the substantial degree of autonomy that already exists in modern weapon systems.

The US military and basically 40 militaries around the world have deployed autonomous weapons systems since the early 1980s. These are often automated systems using essentially deterministic, good old-fashioned AI. They’re on ships — like these enormous Gatling guns called the Phalanx — that can operate by algorithm. If there are too many threats coming in, say too many missiles about to hit a ship, an operator can basically flip on the algorithm, which can automatically target and hit those incoming threats.

You also have semi-autonomous weapon systems that fall into the category of fire-and-forget munitions. Think about how a radar-guided missile works. A pilot believes there’s an adversary radar that’s a legitimate target. They press the launch button, the radar-guided missile fires. After going a certain distance, it turns on a seeker, detects a radar, goes in and destroys the radar. There’s no human supervision or control of any kind after that weapon is launched. Hey, maybe that radar is on top of a school, maybe that radar is on top of a hospital.

That’s the status quo of autonomy in weapons systems. These kinds of technologies have been used since the 1980s. We tend to think they’re way better than what came before, which was the area bombing of World War II.

There’s already a lot of autonomy in weapons systems, which makes this conversation about what we don’t want AI to do in the weapons space a lot harder. It can be challenging to talk about it without inadvertently wrapping in all of these existing weapons — which we generally think are good, in the world where we support military action — because they’re both more effective and more accurate, making things like civilian casualties generally less likely.

Jordan: I was reading To Command the Sky as well as Fire and Fury by Randall Hansen. People forget that when those planes dropped bombs, you’d be lucky to be within miles of the thing you were trying to hit. If we’d attempted something like the Hezbollah compound explosion we saw over the past weekend using those methods, it would have caused tens of thousands of people to die as opposed to 50 or 100.

Michael Horowitz: You would have dropped tens of thousands of pounds of weapons from a couple dozen aircraft.

Jordan: Precision strike capabilities and drones have tightened the radius of the thing that you end up exploding. Even with drones, what we saw with what Israel pulled off — going into specific windows of apartment complexes — represents a massive change.

Ukraine and The Last-Mile Autonomy Problem

Jordan: Let’s take the narrative forward from the 80s to the 2020s. That’s getting a little closer to the contemporary ick factor on this stuff.

Michael Horowitz: Now a thing that’s doable in the context of weapon systems: imagine a deterministic algorithm trained on a very exquisite dataset — say, of Russian tanks or Chinese fighters, something very specific. You can now essentially train an algorithm that can go onboard some kind of weapon system, maybe a loitering munition. It can launch, go to an area, turn on a seeker, and then look for Russian tanks. It can use an image classifier to ask, “Is that a Russian tank?” No? All right, move on to the next image — until it finds a Russian tank, at which point it will destroy it.

This is a weapon launched by a human who, in theory, is trained in how the weapon works and understands its upsides and limitations. But after it’s launched, that weapon not only operates autonomously — meaning you can’t recall it like a radar-guided missile from the 80s — but is now using an algorithm as the basis for destroying a target.

You see the early days of this in the Ukraine context. There’s so much jamming and electronic warfare happening. Ukrainian FPV pilots operating one-way attack drones were getting jammed constantly by the Russians. They’re coming up with different concepts of operation to try to get around that, or they’re working on connecting fiber optic cables that could stretch for kilometers to hit a target. But what if somebody cuts the cable?

There are now some Ukrainian weapons that essentially have last-mile autonomy. If jamming occurs in the last kilometer and the data link goes away, that weapon — trained on an algorithm that maybe has a target library of targets it’s allowed to hit — can still continue on to the target and hit it. That becomes an absolute necessity for militaries fighting in electronic warfare-heavy environments when trying to operate without access to satellites or when your equipment gets jammed.

What Anthropic Actually Said — And What They Got Wrong

Jordan: Why don’t you give the generous reading of the Anthropic case?

Michael Horowitz: I actually have no problem with what Anthropic said. I think they do everybody a disservice when they use the phrase “fully autonomous weapons,” because nobody knows what they mean. Then everybody picks it up because it’s Anthropic, and it would be better if everybody used similar terminology. Words mean things.

Their position is actually very reasonable, which is that LLMs aren’t right for this. Anthropic’s actually probably correct about the limits of large language models in powering autonomous weapon systems — which is also why the Pentagon isn’t doing it right now and wasn’t talking about doing it. That’s one of the many reasons why this whole blow-up between Anthropic and the Pentagon was so needless.

Jordan: What are reasonable concerns model providers should have as their models get into the ecosystem that’s spinning up weapons like drones with last-mile capability?

Michael Horowitz: Part of this depends on what you want the role of the human to be in the context of using weapons and what you’re most concerned about. One of the things that gets lost in the conversation about autonomous weapons systems, at least for the United States, is that the US has a policy on autonomy and weapon systems. It also has both domestic legal obligations and international humanitarian law treaty obligations that essentially require human responsibility and accountability for the use of force.

That’s a requirement that exists whether you’re talking about a bow and arrow, a radar-guided missile, or an autonomous weapon system. When you start from there, things start to fall into place a little bit.

The issue is: if you don’t start from there, and what you’re worried about is AI systems making decisions about whether somebody is a lawful combatant on the battlefield and turning into kill bots — and you think that will happen without a trained commander making the choice to deploy that system in a context that they believe is legal — then you think about it differently.

But if you start from the premise that there’s always human responsibility and accountability for the use of force, and you believe that the Pentagon will follow its own rules and the law on these issues, then it becomes a question of when we think autonomous weapon systems of different types are ready for prime time. By ready for prime time, I mean systems that are as good as or better than existing weapon systems, since nobody wants their weapons to work more than militaries. Weapons that are not reliable or aren’t safe by definition don’t work well. That means military commanders and operators — where the use of these things will determine whether they live or die — are strongly incentivized to get it right.

The Legal Architecture for Killing Autonomously (and Its Limits)

Jordan: Let’s spend a little time walking through the legal strictures that require humans to be involved in this. There have been a lot of Biden-era regulations thrown away over the past 15 months. What else besides that directive is keeping humans involved in these decisions?

Michael Horowitz: The thing that keeps humans involved in decisions on the battlefield actually has nothing to do with the Pentagon’s directive on autonomy and weapon systems. The Pentagon’s policy on autonomy and weapon systems is about the process for developing and fielding semi-autonomous and autonomous weapon systems. Whether a human is actually involved in a substantive way in making the decision about the use of force is governed by separate Pentagon policy — guidance on the use of force written by lawyers — that’s connected to treaty obligations under international humanitarian law.

Commanders and operators have to ensure that uses of force meet requirements like proportionality and distinction. This is not a case where Biden-era policy is standing between us and the kill bots. It’s a broader architecture of law and regulation surrounding the use of force that isn’t even specific to AI.

Jordan: I guess the question is: when you have a secretary of war telling commanders to kill everybody when they see a boat, and there’s no inspector general that exists anymore — who cares? If you’re thinking about selling something into the system, how much can you hold your hat on any of that stuff?

Michael Horowitz: That’s not an AI issue then. That’s a Pentagon-following-the-law issue. If you believe that, that’s not a reason why autonomous weapons systems are good or bad. That would be a reason, in theory, not to do business with the Pentagon at all — not an argument about autonomous weapons systems in particular.

Human Driver : Waymo :: Artillery Shell : Warbot?

Jordan: This seems like an inevitable force of history. We’re going to go from one mile to two miles to five miles of range, from one person controlling one drone versus five drones versus fifty. If the drones are actually better than the sleep-deprived human on their fifth cigarette — the actual analogy is like Waymo versus a human driver — what are the legitimate ethical concerns around the war bots?

Michael Horowitz: In that case, the ethical arguments against autonomous weapons systems are not that persuasive, frankly — if what we’re talking about is a weapon system where there is still human responsibility and accountability. You’re telling me that system will be more effective at hitting a specific target than the 18-year-old on their fifth cigarette? That seems like a better weapon system.

Where this gets tricky is when the objection on ethical or moral grounds gets conflated with pretty legitimate concerns about whether they would actually work. That’s part of what Anthropic’s beef with the Pentagon was getting at — their belief that LLMs like Claude are not ready for prime time when it comes to incorporation into autonomous weapon systems.

This is part of the issue: it was not clear, and from what I know, not even true, that the Pentagon was trying to get Anthropic to develop autonomous weapons systems fueled by LLMs. This was a theoretical concern about a possible future ask from the Pentagon. Anthropic even said they think autonomous weapons systems actually make sense — they just think their technology isn’t ready for prime time on this.

Part of the challenge is that all military systems, and especially weapons systems, need to go through a testing and evaluation process — that’s how the military figures out whether a system is reliable. It’s challenging to figure out how testing and evaluation for large language models should work, especially in safety-critical use cases like potential weapon systems. There’s work on the backend that needs to occur to validate these systems, in addition to whatever advances in the systems themselves that Anthropic thinks needs to happen.

The Cloud vs. Edge Distinction

Jordan: What do you think about this cloud versus edge distinction that bubbled up this past week?

Michael Horowitz: I’m actually reasonably sympathetic to a cloud versus edge distinction as important, but that’s because I am very anchored on the Pentagon’s definition of an autonomous weapon system — a weapon system that, after activation, can select and engage targets without human intervention. Unless there’s continuous human oversight of that system, by definition there is no cloud access. Effective autonomous weapon systems generally aren’t going to have data links and cloud access.

If you have a system that only operates through the cloud, then it almost by definition can’t be used to power an autonomous weapon system. You could use it to do lots of other military operational things — planning military operations, directing things. But if it’s cloud-based, it can’t operate on the edge in an autonomous weapon system. I’m actually reasonably sympathetic to that distinction, at least at a high level.

Jordan: So the idea being: if you think doing autonomous weapon systems is icky, but you still want to help out with command and control, logistics, and back office stuff — being in the cloud API access provision space is a relatively neat way to make that distinction.

Michael Horowitz: Based on where the technology is right now. Keep in mind, Anthropic is correct that LLMs aren’t ready for prime time in terms of incorporation into autonomous weapons systems. Even if you could somehow put them on the edge, it’s tough for me to imagine those kinds of systems surviving the Pentagon’s own review process. But if your system can’t operate on the edge, it can’t be in an autonomous weapons system, period.

The Real Worry: Automation Bias at the Top

Jordan: Let’s talk about command and control. AI is smarter than me, man. What’s the point of these humans anymore?

Michael Horowitz: Come on, nobody puts Jordan in a corner.

Jordan: With autonomous weapons, the range of how bad things can get seems relatively narrow — a thing can blow up a school or accidentally turn around and blow up the base it came from. But once you start handing over more range — let’s talk about the rogue drone swarm, that seems really not great. But one or two levels up, like a rogue brigade, a combatant command...

Michael Horowitz: Here’s why I’m not that worried about the rogue drone swarm. Militaries, when it comes to weapon systems, tend to be relatively conservative institutions. Because of the incentive structures I laid out before and the challenges in developing good testing and evaluation procedures, the notion of a super unreliable drone swarm causing major chaos — maybe there are militaries we should worry about that for, but even in the current context, I am not terribly worried about that for the United States. The drone swarm would still have to be activated by a responsible human who would be accountable if something went wrong.

The militaries can develop standard operating procedures and training to try to hedge against this as much as possible. But the more important risk is this: if you want something to worry about more, it’s operational decision-making. We already have tools like Maven Smart System designed to be a dashboard for commanders at the combatant command level — what do the enemy’s forces look like? What does information from open sources look like? What do classified sources look like? It aggregates those things together, interpreting that information in a way that may generate increasingly specific recommendations to commanders for courses of action.

The risks there are more prosaic than we sometimes talk about. One risk is automation bias — people trusting algorithms more than they should given the reliability of said algorithm. There are all sorts of behavioral decision-making biases that get triggered if you’re just offloading more and more cognitive judgment to the machine.

Jordan: I’ve been using Claude Code for the past few weeks. It asks me, “Do you want to let it do this?” I say do a thing and it says, “Okay, well you need permissions, press two to give permissions.” I’ve been pressing a lot of twos. Then I Googled how to stop pressing two, and the internet said there’s a setting you can put into Claude that says “dangerously accept permissions.” Now I don’t have to press two all the time, and it just does what I want to do. It’s been totally fine so far — way more efficient, way more effective, less time.

Maybe all we have to hold onto is the idea that these are slow and bureaucratic institutions with paper trails, humans with legal liability if they screw things up, and the moral weight of killing the wrong person. But there does seem to be something inevitable about more and more parts of your work being handed over to a machine. We could end up getting to a point where we hand over too much in a dangerous way.

Michael Horowitz: Totally. The risk here isn’t necessarily connected to whether it’s a large language model or not. The question at the senior level is: where are the standard operating procedures, the training, the incentives that apply to warfighters in the field? They don’t necessarily apply to senior leaders.

If you really want to worry, that’s where I would worry. Senior decision-makers, uninformed about AI, trusting AI tools too much in guiding their decisions — if you want to know how things really go awry, it’s less because of AI at the pointy end of the spear and much more at the strategic level.

Jordan: It’s the president and defense secretary just chatting with their mil.ai, scheming up who to bomb next — that’s what we should worry about.

Michael Horowitz: You should feel a little bit better about everything else. Most of all, it would be helpful if everybody used the same terminology when discussing this topic. Autonomous weapons systems, AI decision support systems, automation bias — if we could all use the same words for what we’re talking about, it would be easier to have these debates.

Jordan: This conversation illustrates why, aside from the personality issues, I think what really tripped up Anthropic and the government was the domestic surveillance side. With autonomous systems, you can fudge a solution. I imagine Anthropic was essentially saying they didn’t want to be involved in finding undocumented immigrants. The government’s response was basically: “We were duly elected to do this. Why aren’t you letting us proceed?”

Michael Horowitz: I think it’s totally reasonable to be worried about AI-enabled mass surveillance. I don’t worry about it most from the Pentagon. I worry about it more from other agencies. But it’s totally legitimate.

Jordan: All right, let’s call it there. Thanks for dropping by, Mike.

Michael Horowitz: Cool. Thanks for having me.

Suggested Titles

1. Autonomous Weapons 101: What the Anthropic Fight Got Wrong

2. Kill Bots, Cloud APIs, and the Real Risk Nobody’s Talking About

3. The War Bot Panic, Explained

4. From Phalanx to Maven: A Field Guide to Military Autonomy

5. Last-Mile Autonomy: How AI Is Already on the Battlefield

6. The Actual Danger Isn’t the Drone Swarm

To discuss America’s brand new war — plus Hegseth vs Anthropic — we are joined by Emmy Prabasco from CSET, Henry Farrell of Johns Hopkins, Penn professor Mike Horowitz, and Bryan Clark from the Hudson Institute.

Our conversation covers…

• The role of “precise mass” on both the US and Iranian sides,

• Why the IRGC can keep fighting despite leadership decapitations, and whether US operations will lead to protracted conflict,

• What China is learning by watching the US military in action,

• How Anthropic’s red lines would fit into the culture of the Pentagon,

• How China benefits from Anthropic’s blacklisting.

Listen now on your favorite podcast app.

We’re holding the $3000 ChinaTalk economic security essay contest open until midnight EST on March 8th. And if you want to write for ChinaTalk about other stuff, read this!

Also, good job alert: ‘Part-Time Analyst Role at a Stealth-Mode China Tech OSINT Startup’—the founder I respect tremendously. Apply here.

A Theory of Victory (?)

Jordan Schneider: Mike, let’s start with you. This is our first major American precise mass campaign, right?

Mike Horowitz: I don’t know if I’d call it a precise mass campaign. What’s notable is that the United States used a system called the LUCAS, which is America’s first precise mass system. It costs less than $100,000 and can travel a couple thousand kilometers. You can shoot it down, but you have to try.

Ironically, it’s reverse engineered from Iran’s Shahed 136 — effectively using Iran’s own technology against them. Though Iran itself copied some West German tech from the ’80s to design the Shahed, so what goes around comes around.

From a military technology perspective, it’s interesting to see the mix in the Iran operation. We’re seeing American legacy strike capabilities like Tomahawk missiles alongside emerging capabilities like the LUCAS. Claude is even in the mix — who would’ve thought after Friday’s events that Claude would enter the chat so early?

Jordan Schneider: Let’s start at the strategic level. I was discussing with someone how Pape’s “Bombing to Win” captures much of the 20th century story — bombing people doesn’t always get you what you want. But the difference between bombing in 2026 versus 1943, or most of the 20th century, is that now you can actually kill all the people who run the country.

I asked Claude for historical comparisons of killing leaders without invading. It gave me examples like Jugurtha of Numidia and the Byzantines overthrowing boyars. This is relatively rare in human history — pulling off an assassination from hundreds or thousands of miles away without having someone inside the country ready to take over.

Where are we on air power now? We’re four days in, so obviously TBD, but I’m curious about everyone’s takes on the theory of victory here.

Bryan Clark: You need somebody to pick up the pieces and run with them afterwards. Any competent autocrat in the 21st century will eliminate potential competition. It’s not like when the British faced the American Revolution — we had people who could take charge, and they didn’t bother assassinating them in advance.

Air power can be very effective at eliminating leadership, but you need civil society that can pick up the pieces, or you need to be willing to put that in place with people on the ground. That still seems to be the missing element.

Mike Horowitz: Pape’s original argument was more nuanced. He argued that coercive bombing — when you precisely hit targets — can generate concessions from the target. The issue is that punishment bombing — hitting random targets in a country — generally creates a rally-around-the-flag effect and makes it difficult to extract significant concessions.

What’s different today is the scale and velocity of precision strikes. Reports indicate Israel launched more than 500 attacks on the first day — frankly, the United States has never conducted that many strikes in a single day, despite our weapons stockpile. This illustrates how the world is changing.

However, if you want to argue nothing has changed, the Israelis once again demonstrated exquisite intelligence on every regional actor except Hamas. They knew exactly where leadership meetings were happening, enabling them to execute decapitation strikes on day one.

Bryan Clark: Air power can achieve these results when there are no air defenses to contend with. In Ukraine, air power isn’t cutting it because air defenses prevent unimpeded airspace operations. Iran’s air defenses are largely neutralized, allowing Israel to fly around launching JDAMs at targets. They don’t need standoff weapons — they can operate at volume and execute an effective coercive campaign, taking out infrastructure that would be difficult to hit with precision standoff weapons.

Mike Horowitz: It’s unbelievable. We’ve never seen the United States attempt a military operation of this scale with such incoherent goals. Sometimes it sounds like regime change; sometimes it’s about “eliminating the threat” — whatever that means.

Ironically, the Trump administration has broken Colin Powell’s Pottery Barn rule — “If you break it, you buy it.” That’s not how this administration sees the world. They’re willing to take actions no previous American administration would consider because they don’t feel responsible for governing the places they bomb.

Henry Farrell: Is it a good idea? That makes sense, but the question is whether it’s a good idea in the long run. Mike, you know better than I — you’re a real national security person, I’m not. But there are countless arguments, articles, and books discussing how this kind of intervention doesn’t necessarily end well over the longer term.

Do you think this will have benefits? Or will this be a disaster — not quite like Iraq, but something similar where we see continuing problems for years, perhaps longer? What’s the long-term strategy beyond just going in and reducing everything with air power?

Mike Horowitz: I’m not sure the Trump administration has a strategy beyond 2028. It would be a real bad look for our political science business if the Trump administration could do Venezuela, then Cuba — which is obviously next — with no backlash and no negative secondary effects.

Everything we’d expect theoretically suggests instability is likely to occur in these places. You have power vacuums, which increase the risk of terrorism and militia-like groups lashing out. This would be very dangerous.

It’s possible we don’t see that in the short term but do see it in the long run. But the effects might look disconnected enough from the initial operation that the Trump administration doesn’t care as much. You’re absolutely right — I just think they’re unconcerned with instability per se or increased risk of terrorist attacks.

Emmy Probasco: Should we also give airtime to the argument for why now? I concur with everything you’re saying — we’ve opened Pandora’s box. But there’s another perspective that’s at least worth discussing.

Bryan Clark: The argument would be that Iran’s on its back foot. There’s an opportunity to eliminate it as a military threat. If you’re Israel, this is a terrific opportunity to eliminate Iran’s ability to threaten you with missiles or even a nuclear program down the road. You may not care that much if it becomes a mess — maybe not a failed state, but not a well-governed state either.

But if you’re Qatar or the UAE, you may not appreciate that. Now you’ve got to deal with this unstable neighbor that’s probably interfering with shipping. If you’re Qatar, you depend on LNG exports for a massive portion of your economy. You can’t have the Strait of Hormuz closed off periodically like the Red Sea, or you’ll start losing economic livelihood.

For the Gulf states, this is not great. I’m surprised they didn’t push back more on the effort to mount this operation. But they’re going to be the ones that inherit it, probably not Israel.

Emmy Probasco: Not to say that Iran didn’t have problems to begin with — I don’t really understand where this goes either, to Henry’s core question of what our goal is here. We shouldn’t gloss over that Iran didn’t necessarily have a great government to begin with.

Mike Horowitz: That’s right.

Jordan Schneider: My question is, if you want to do regime change, don’t you do this while the protesters are in the streets and not after 30,000 of the most eager people are dead? The timing seems problematic.

Mike Horowitz: Sure, but it takes time to line up a military operation and get all your assets in place. I’m curious what Emmy and Bryan think about this. At any given moment, you could launch a couple of Tomahawks or send a special forces unit. But if you want a sustained campaign, you need to array the forces. This is also why I’m not worried about a US. ground invasion of Iran — the forces just aren’t there right now. It would take months to align ground forces for an invasion.

There’s another element here. If Iran goes down and then Cuba goes down, think back to the end of the Cold War period and the rogue states we used to talk about. The Trump administration is going around trying to knock off everybody on the checklist, like the end of The Godfather. It’s like a reset. What happens if we get back to North Korea?

Bryan Clark: Taking care of the family business.

Henry Farrell: What does it do to nuclear proliferation?

Mike Horowitz: Everybody’s going to get nuclear weapons now. Are you kidding? The majority of the South Korean public already wanted nuclear weapons. Why would they stop now?

Bryan Clark: The old-school way of doing this back in the ’70s or ’80s would have been having the intelligence services establish another power center that would be able to take over when the regime goes down. The CIA did this routinely in South America and Central America.

It seems like in this case we used the intelligence services to find out where all the head guys were going to be and then take them out at once. But we didn’t do anything to establish an alternative that would rise up and take its place. We haven’t really thought that through, because there doesn’t seem to be any discussion about who we would prefer to take over from the current regime.

Jordan Schneider: Trump had a line where he said, “Oh yeah, I had some ideas of guys in mind and, oops, we just killed them.” Now we’re on dude number 50, who we might not even have a case file on. When we’re that far down in the minor leagues — the Deputy Minister of Agriculture — let’s come back to something Mike said earlier about the theory of if this works. If this ends up working out, what did we not understand about the world?

Mike Horowitz: I don’t think we failed to understand something about the world. This is really a question of how you process and assess risk.

The argument against going after Iran has always been that Iran possesses chemical weapons, long-range drones, various types of missiles, and numerous USVs. They could shut down the Strait of Hormuz. Setting aside any moral or ethical considerations about whether to fight them, there’s a parametric risk of escalation. Their air defenses might function better than expected, or they could unleash substantial terrorist attacks in Europe and shut down the strait for weeks.

In some ways, it might suggest that we assessed these risks at too high a probability. Alternatively, we may have accurately assessed the risks and simply got lucky — the dice roll of reality where we didn’t see those impacts. But it’s also possible, given how history unfolds over time, that we’ll end up seeing some of these impacts, just not immediately. Maybe it’ll happen tomorrow. I don’t know.

Henry Farrell: There’s that old Bismarck quote — “God loves fools, drunks, and the United States of America.”

Mike Horowitz: I used that quote in my US foreign policy class last week.

Jordan Schneider: The terrorism angle deserves more attention. We’ve had multiple failed assassination attempts by the Iranians, but they were using the B team. They tried to contract it out and ended up contracting to FBI agents who are now busy finding immigrants. That’s a real risk. I’m not eager to see how that plays out.

I had an operational question —

Mike Horowitz: Was it about how screwed we are in the Indo-Pacific?

Bryan Clark: We’ll get there. I promise.

Jordan Schneider: The fact that you can kill this many people and Iran is still firing missiles and conducting operations — should this be surprising? Impressive? What does that tell us?

Bryan Clark: They’ve been preparing for this scenario for decades. They have the infrastructure to support distributed missile launches. They still have a couple hundred ballistic missile launchers available and an untold number of Shahed drones they can deploy.

They’ve distributed their command and control, especially within the IRGC, which is trained to operate in a distributed manner. They don’t need contact with headquarters to execute operations.

Jordan Schneider: That’s the challenge, right? The Iraqi army surrendered when Trump sent a text message saying “surrender or be killed” — they weren’t literally all going to be killed. That’s different from tanks rolling in from Kuwait. I’m concerned about the implications.

Mike Horowitz: You should be worried.

Bryan Clark: There doesn’t seem to be an easy way for this to end cleanly. It seems inevitable that this will be protracted. The only question is protracted in what way? Does it result in continued closure of the Strait of Hormuz and economic impacts? Or does it result in continued ballistic missile attacks that eventually start taking out things we care about?

Jordan Schneider: Other operational stuff? You want to go to China, Taiwan, Mike?

Mike Horowitz: It’s striking that it’s day one of the conflict and you already have articles showing up in the Journal, the Times, and the Post saying the US might run out of weapons soon.

Far be it for me to not take this moment to describe again how bad it is when somebody fires a $50,000 shot at you and you fire a million-dollar thing back to destroy it, and how thus we should be firing the $50,000 shots. But that is not sustainable.

If Bryan is correct in his assessment of Iran’s ability to continue launching, or they could even reconstitute some of that launch capacity over a month-long period, then you’re really drawing down stockpiles. The US. isn’t just protecting the US. Navy or US. military bases. The US. is also playing a role protecting all the Gulf countries. Recall how upset they have been in the past when they have faced risk in this context.

There’s a lot of pressure on the US, and that means if this keeps going, the US will have to pull — in theory would need to pull — some stockpiles out of the Pacific and send them over to the Middle East to be able to continue intercepting Iranian attacks at the rate that they’re being intercepted. That’s risky.

Bryan Clark: The air defense interceptor inventory is the big problem. We’re burning through those at a pretty high rate. Even if you’re smart and don’t use them to shoot down the Shaheds — you use your guns or something else to take down the Shahed — you’re still using a lot of them to take out ballistic missiles.

Then the Shaheds are used on all the soft targets that are undefended because you can’t protect everything at the same level. These Gulf countries are now having to come up with a way to defend against Shaheds, which they didn’t have to before. They’ve got to defend their shopping malls and airports against long-range cheap drones.

Emmy Probasco: Not to mention all the naval assets that we shift over there that could have been doing other things.

Bryan Clark: Right. 100%. Great point.

Mike Horowitz: I wonder what information we’re now communicating to China about how our air defenses operate after seeing American air defenses have to operate at scale against Iran. Where are the soft spots conceptually that could inform — look, the Chinese pay super close attention to everything we do. This will be no exception.

Obviously the world has had a very close look at offensive US capabilities throughout the war on terrorism period. They’re certainly well-versed in those, which is one reason why they’ve been nervous about them — we don’t have enough of them, but they’re pretty good. But now they’re getting a really good look at US air defense having to operate at scale.

Bryan Clark: The flip side is that US air defenses, especially the sea-based stuff, has worked. The ground-based stuff has worked too. As a retired Navy guy, it was surprising to me that this stuff actually works when the time comes — you get shot at, you pull the trigger, and it actually defends like you thought it would.

Mike Horowitz: Our $2 million interceptors should work against the Shahed.

Bryan Clark: They worked against ballistic missiles too. What’s interesting is that this stuff works. Now it’s expensive and it’s overkill for a lot of these threats. What this has done is given these guys a lot of sets and reps to evaluate what’s the right defensive system to use against the Shahed. They’re not using SM-2s against Shaheds anymore. They’re using guns, other drones, jammers.

It goes both ways. You’ve given a bunch of telemetry to China that they could employ in their own tactics development. But we also got a bunch of feedback that allows us to refine our approach. Otherwise we would’ve been doing this against China and probably not doing it nearly as well.

Emmy Probasco: Bryan’s got a great point there. I’d also add the operational experience in the Red Sea where we’ve learned a lot. The number of times I heard about what was happening on the ships out there and thought, “Oh my God, you don’t do those maneuvers unless you think you’re about to die.”

It has taught folks a lot. The reps and sets have begun, and we see them extending now, but all of this is fantastic data for China.

Bryan Clark: But it also provides combat experience, right? You have the Chinese military with zero combat experience following the most recent purge, going up against US forces. Obviously, this isn’t against a peer competitor, but it’s better than nothing.

Jordan Schneider: I did note General Caine saying “joint” a thousand times. But it’s relevant, right? We really have a lot of players in this at the moment.

Bryan Clark: Well, it’s his job. He’s the Chairman of the Joint Chiefs. It’s branding. He’s not actually in charge of anything — he’s in charge of the staff, in reality. If you’re the chairman, you’ve got to highlight the joint nature of the operation so you can call out the logistics.

Jordan Schneider: And don’t forget about the family members. He’s giving everyone their kudos. All right, Mike gave us the transition earlier. Who do you think put the story out that Claude was being used in the Iran operation — Anthropic or the Department of Defense?

Emmy Probasco: Operation Epic Fury. I don’t think it takes much to figure out that CENTCOM is using Maven Smart System.

Mike Horowitz: They tell us every single time they can.

Emmy Probasco: Maven Smart Systems is at all the combatant commands. Claude is integrated into Maven Smart Systems. That’s not to say everything Maven does involves Claude. Maven does lots of things, some of which have absolutely nothing to do with AI — it’s purely just moving data around.

But CENTCOM’s probably the furthest ahead. They’re the most experienced warfighting COCOM and the most experienced with Maven Smart Systems. General Kurilla is sort of the OG here — he was at the 18th Airborne and really did incredible work there, then went to CENTCOM. To the reps and sets conversation we had earlier, they’ve been working very hard to get as smart as they possibly can and use it in the most responsible way.

I don’t know what exactly they’re doing. I’m very happy not to know exactly what they’re doing, but they are the most experienced COCOM in the use of MSS and therefore, presumably integration with Claude.

Mike Horowitz: Fair enough. This doesn’t necessarily need to be a deliberate leak. This could easily just be somebody asked someone at CENTCOM and they happened to say it. Frankly, that’s often more likely from my viewpoint than a deliberate stratagem to get the information out there. Plus one on everything Emmy said.

Bryan Clark: Maven Smart System — not to throw shade on it, God forbid — but it’s a little clunky to use. It’s like your typical web thing where you’ve got a lot of menus to navigate and multiple things to pull down to create a workflow. Having some kind of AI tool to help you do that is almost essential to run at an operationally relevant tempo.

These planning tools have so many parts you can pull together into a kill chain. If you want to do that at any sort of scale and tempo, you need something to help you do it.

Emmy Probasco: I mean, I would — sorry, just to push it even further, Bryan — it wasn’t exactly like our weapon systems on our ships were a joy to work with or easy to manipulate or even understand. This is a step change improvement.

One of the things that’s super interesting about Maven Smart System is that it’s got lots of bells and whistles. There’s so much you can do. It’s workflow software with a bunch of data streams that you can manipulate, which is awesome and super intimidating. You can’t just sit down and expect to manipulate this thing like you’re doing Gmail. It just takes a lot of work.

AI does help, but in my mind, the AI helps less with user interface than it does with processing the sheer volume of data. There’s so much data available that it’s extraordinarily difficult to make sense of it. I don’t even know that the cloud is making sense of all the data all the time, because the use cases there are questionable sometimes. But it’s really good at writing the daily report to the command center. There are some really boring things that happen every day in an operation, and AI can be helpful in supporting people who are going to do that anyway — helping the person, not necessarily replacing them.

Bryan Clark: It helps you build that workflow too.

Henry Farrell: Here’s my sense as somebody who has spent zero time in any part of the armed forces whatsoever. My fundamental working assumption with all of this is, AI is fundamentally, in its current form, a bureaucratic technology.

It allows bureaucracies — and if there’s one bureaucracy that is the biggest bureaucracy of all, it is the DOD — to do things more efficiently than traditional paper pushing. Summarizing information, translating between different languages different branches use, all of these really mundane but nonetheless crucially important tasks.

Programmable Mutter

AI is a bureaucratic technology. So is war.

A short post as an addendum to the previous, on an aspect of the fight between Anthropic and the Department of Defense that ought be clear but perhaps isn’t, because it doesn’t fit easily into the stated terms of disagreement. The important beef is not…

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a month ago · 25 likes · 9 comments · Henry Farrell

When we look at this big fight between Anthropic and Palantir, how much of this is really missing the point? There are real issues here. On the one hand, you can see ways in which these technologies can be used to automate certain aspects of operations, which are highly problematic. On the other hand, they can be used — and this is clearly part of the story — for domestic surveillance. If you have a bunch of disparate data about individuals from different social media services or dating services, you can pull stuff together in ways that make sense.

But this is not actually about whether we’re going to see Terminator happening in 5 or 10 years’ time. This is about much more mundane, much more ordinary, albeit crucial and sometimes pretty scary uses that the technology could be used for. I would love to get you guys’ sense on that because that’s my sense.

Emmy Probasco: I’m in violent agreement with you, Henry. Everything you’ve said is just right. There’s so much of this that’s mundane.

I’ll give you one of my favorite examples of where I’ve seen an unclassified demonstration of something that could be used on the classified side, which is foreign disclosure. There’s this super boring task that has to happen where we have all this classified intelligence and you might want to share it with a partner. They may not have — you may not want to give them the full story. You might want to tell them, “Hey, we have aircraft in a particular area,” but we might not want to tell them how many.

You can put together an LLM, an agentic workflow that takes the original intelligence, then runs it through all the different parameters from the different guidance documents that these guys get, and then come out with a sanitized version of the intelligence. Super boring, totally a bureaucratic task. This isn’t to say that necessarily it always gets it 100% right and you should never look at it, but the time task of doing it in the first place can be so much more efficient.

If we could really help people understand that nobody really wants a Terminator, or this warbot meme that’s going around on the internet —

Mike Horowitz: Even I don’t want a Terminator.

Emmy Probasco: None of us do. I keep trying to tell people, military officers fundamentally like control. To cede so much control is not really in their DNA or their training or their bureaucracy. But anyways, this is all violent agreement with you, Henry.

Mike Horowitz: I agree with everything Emmy said. I would add one distinction, which is I would distinguish between AI and LLMs in that — this is part of where the challenge has been frankly in the warbots conversation. The Pentagon has deployed autonomous weapon systems for like 40-some-odd years, essentially. If you use the Pentagon’s definition of autonomous weapon systems, that’s true.

If you use phrases like Anthropic’s “fully autonomous weapon system” — nobody should ever use that phrase. But whether fully autonomous weapon systems or whatever phrases the NGO community uses — and frankly, they’ve probably been using autonomous weapon systems for many more years because they’re wrapping in a lot of precision guided weapons and things like that. This has created a lot of challenges in the conversation.

Anthropic is certainly correct that the last thing you would do is take Claude trained on the slop of the internet and slap it in a weapon system and hope that it would hit the correct target. Anthropic is right. That’s not ready for prime time.

Which is why you would use instead a super bespoke algorithm trained on a very bespoke dataset that probably wasn’t LLM based, but would still be an autonomous weapon system or even an AI-driven weapon system. The things you would worry about, the risks, some of the control issues that Emmy smartly mentioned are very different in that context. But that nuance has just gotten lost here.

Emmy Probasco: There’s also the fact that no perfect weapon system exists. I certainly don’t know of one.

Mike Horowitz: Perfect weapon system.

Emmy Probasco: Bryan is right. No, I’m just — odd, Mike. But they’re all flawed. We learn to operate with flawed weapon systems, and we learn when to deploy them and how to deploy them.

While I really appreciate that we’re having this conversation and I’m glad people are interested in this topic — it deserves deep thought — I don’t think people entering this conversation recognize how many fail-safes the military builds into its processes and how serious these issues are. These are still human beings who go home at night and want to sleep with a clear conscience.

We have multiple layers: First, there’s the technology. Can we get the technology to the highest level of reliability and precision? That’s one part. Then there’s extensive training for operators. You don’t get to operate these systems without going through rigorous training and having someone higher up the chain of command say, “Yes, you are authorized to push that button or conduct that operation.”

On top of that, as Henry pointed out, we have this phenomenal bureaucracy that we’ve perfected over time, building in numerous checkpoints. You may turn it on only at specific times. You may point it only in certain directions. The rules of engagement, battle applications, battle orders — there are countless bureaucratic safeguards.

We implement extensive processes and procedures to minimize the risks of imperfect systems. This doesn’t mean we should rush forward with any of these tools, but rather that we must build comprehensive doctrine and operations training around them.

Bryan Clark: It’s important to distinguish between autonomous weapons and AI-enabled command and control and planning functions. These are very different in terms of capabilities, potential guardrails, and the degree to which we’re willing to delegate control to AI systems, whether LLMs or other AI-enabled systems.

In our wargaming, we find that teams eventually reach a point where they just press the “I believe” button — accepting whatever course of action the AI recommends because the situation becomes too complex. When you’re developing your MAVEN smart system kill chain and running out of time, you think, “Okay, what do you think I should do? That’s good. We’ll execute that kill chain.”

The autonomous weapon can have extensive guardrails, but if we’ve built a plan derived from some model and we’re just expecting it to work without killing innocent civilians, we’re not actually verifying that. This essentially negates any effort to make the autonomous weapon safer because our planning process itself isn’t safe.

Henry Farrell: Let me push a slightly different version of the Dario Amodei story. I don’t buy into Amodei’s vision of a nation of geniuses in an AI lab pouring out revolutionary technology in 5 or 10 years. However, I think his ideas touch on some real concerns.

My sense — and I believe Mike agrees — is that I have complete faith in much of the military ethos the United States has created. On the same day that Hegseth made his controversial statement, he also said he would eliminate opportunities for military personnel to pursue advanced degrees at various universities, claiming professors were incredibly hostile toward the military.

My experience, like Mike’s, is that officer corps members are among the most thoughtful and interesting students you can have. They bring a standard deviation more care, principle, and ideas than most people.

Mike Horowitz: They’re awesome in the classroom.

Henry Farrell: They’re wonderful in the classroom. That’s pretty much universally agreed upon.

However, if we’re in a military where Hegseth is essentially saying “we don’t want to worry about stupid rules of engagement,” that makes me nervous. When we’re in a world where, as Emmy points out, these technologies are fundamentally imperfect with tons of slop, you have to worry about how leadership differences might intersect with these systems in unfortunate ways.

I’m especially concerned about domestic information gathering. Much of this seems to involve access to domestic information. The US military can legally circumvent Executive Order 12333 restrictions by gathering information from commercial databases. I’m frankly nervous about how this might evolve 2, 3, 5, or 6 years down the line if it’s not pushed back against.

Mike Horowitz: I worry — I agree with you macro. I’ve been very vocal that the Pentagon has been adopting AI too slowly for a long time rather than too quickly. The risks have essentially always been that the US military would rest on its laurels and has been too slow about integrating emerging capabilities. This is partly because of all the policy, procedure, and process — most of which has nothing to do with AI at all.

The risk for the US is generally going too slowly rather than too quickly. Frankly, even in the Hegseth era — though I’m less comfortable making this argument at present — all that policy and procedure still exists in ways that make it fundamentally difficult. As Emmy suggested earlier, incentives are actually aligned to have systems that work because unreliable systems, by definition, don’t work. Commanders and operators won’t want to use them because they need things they can trust. If they can’t trust these systems, they won’t use them.

Both Emmy and I have done research on automation bias — this phenomenon of over-trusting AI. It’s like Bryan’s point about people just hitting the “I believe” button. If you trust algorithms more than you should given their accuracy, you solve that with training and standard operating procedures. It’s frankly good that in these war games people get confused and press the “I believe” button, because that shows you how to improve.

Here’s something to make you feel better: I have a draft paper I’m working on with Lauren Kahn and Laura Resnick Samotin that compares West Point cadets to a similar sample of the US general public (matched for age and education). The West Point cadets are substantially less susceptible to automation bias than the general public. The mechanism is essentially the training the military gives people — not just in AI, but in warfighting and decision-making in general. This actually can make people more cautious, which supports Bryan and Emmy’s point.

Emmy Probasco: I agree. I actually did a study with Lauren Kahn where we compared how the Army uses the Patriot missile battery to how the Navy uses the Aegis weapon system. These systems are very similar, but what’s interesting — and this goes to your point, Henry — is that if we’re going to accept imperfect weapons (which frankly we have no other choice), then you need the bureaucracy to address it.

In terms of bureaucracy with the Patriot, they staff the missile battery with slightly more junior personnel who have slightly less training. In the original unclassified training documents, it basically says: “Just turn the system on and don’t touch anything because this system is smarter than you.” You can read that in the guidance documents.

If you go to the Navy, it says: “This is your responsibility, and if you screw this up, it is entirely your fault.” I was trained under that system.

Mike Horowitz: This is so true.

Emmy Probasco: This is great, very seriously. Now, that said, both sides have committed terrible mistakes. The Vincennes incident and the Navy instance — they didn’t trust the system. The system was actually correct, but they said, “I don’t trust the system,” and then they accidentally hit the wrong thing. In the Patriot fratricide, they stayed hands-off because they said, “We don’t know what we’re doing.” There’s no perfect answer here — it’s a sad story, but there are bureaucratic choices that can be made.

If we’re eroding the bureaucracy, if we’re eroding test and evaluation or all the different things that have to come after you buy the weapon system, that’s problematic. Our operators don’t love — to Bryan’s point — if you drop MSS on an operator’s desk, they’re going to be like, “Okay, this is complicated.” But if you give them proper training and get them certified, they’ll become more facile and better at their job.

I don’t want to miss Henry’s intel point, which isn’t my area of expertise. I’ve learned enough to be very humble about how intelligence works. There is a worthwhile conversation to be had about what we expect in terms of available data. While we’re concerned about how it might be used domestically — and I’m certainly in that camp — the same data is being bought by China. It’s not like it’s not available.

This is more than just a problem of how we choose to govern the way our government uses data. It’s about how we choose to allow our data to be shared and how vulnerable we are now in ways we weren’t before. The data was there, but you couldn’t really use it until you had these new tools.

Bryan Clark: You’ve got companies like Vannevar Labs and others commercializing the harvesting of commercial data, using it on our enemies, and then giving it to the US government. The US government has benefited from this availability of open source intelligence and data, and we’ve been using AI tools to harvest it.

It’s a legitimate question: How much of that is going to be US information that’s leaked over into somebody else’s network, which we’re now harvesting for military intelligence gathering? It’s similar to FISA — the same challenge. If I’m going to spy on somebody else but they’re talking to somebody back in the US, I’m now essentially spying on somebody in the US. We have to ponder this. Back to Emmy’s point, the only way to really keep it in check is to avoid giving so much data to third parties that are going to be able to provide it to somebody else.

Claude and the Pentagon

Jordan Schneider: Can we come back to the fight on Friday that happened over the weekend? On the government’s autonomous weapons stance, what do you see as the strongest piece of that argument?

Mike Horowitz: To me, this is a dispute about personalities and politics — or frankly, a dispute about personality and politics masquerading as a dispute about policy. The OpenAI deal is the clearest evidence for that.

But there’s even more evidence. First, Anthropic was the first company to do classified work. Second, Anthropic was happy to fulfill every request the government made. Third, there were no upcoming government asks that Anthropic didn’t want to fulfill — at least not publicly.

This was essentially a theoretical fight about future potential use cases and who gets to decide. The government seems to think about AI tools the same way they think about missiles from Lockheed. Lockheed doesn’t get to tell them which countries they can target with LRASM. But Anthropic views this more as a service where each use of their technology would require Anthropic personnel to help build it out.

This creates challenges, but to me, this is really a breakdown in trust. The government doesn’t trust that Anthropic will be there for important national security needs. And Anthropic doesn’t trust that the government will be responsible — perhaps for some of the reasons we’ve been discussing. But this wasn’t a fundamental disagreement over any use case that was actually on the table. That’s my perspective, but I’m curious what others think.

Bryan Clark: I agree with Mike. They definitely weren’t arguing over what was actually being discussed. Nobody was saying the government would pursue use cases that Anthropic opposed. It seemed much more about “you’re changing our terms of service.” They didn’t like the open-ended nature of the new terms, which essentially meant no terms of service. They wanted to retain the ability to put a brake on any future use case they disagreed with.

My question for Emmy and Mike is: When the government uses Claude on classified networks, is it hitting Anthropic’s server farm somewhere, acting as a service? Or are they using Claude under some kind of OTA product model?

Emmy Probasco: That’s a good question. I don’t actually know how they’re using it. My presumption is that it’s somehow hitting NGA’s compute.

Bryan Clark: But it seems like Anthropic people must still be involved in the use of Claude on a day-to-day basis. Otherwise, this would be like an LRASM situation where you gave them a version of Claude and now it’s out of your hands. The government might use it for whatever.

Emmy Probasco: I actually don’t know. To back up a little, we’ve been trying for a really long time to make strong bonds back to the commercial tech sector. They are so important to our operations. That’s where the R&D money is.

Mike Horowitz: This has been a rough week for goals that Emmy and I have had for a while.

Emmy Probasco: Right. On the level of government working with commercial tech, this was a pretty sad week. Hope springs eternal, though. I would like us to get back to it because I’d love to have a conversation with folks in the Valley and elsewhere who are doing commercial tech but thinking about defense. Now they’re wondering — we just took a step back, and that’s really unfortunate.

In terms of the terms of service, as Mike and I were discussing, if you put “autonomous weapons” in a contract, please define “autonomous weapon.” I’ll wait. It’s so hard. I can understand why there’s friction there. At the same time, there are laws around autonomous weapons, but the law is just: did you notify the government that you changed the policy? That’s the law. There could be space to do something meaningful there.

Jordan Schneider: Mike, how do you feel about your directive getting a new moment in the sun?

Mike Horowitz: For listeners who don’t know, the office that I was privileged to run in the Pentagon rewrote the Pentagon’s policy on autonomy and weapons systems in 2023. We were accused at the time of two things: one, by the NGO community, of providing a pathway for the development of autonomous weapons systems; and second, by some, of overregulating autonomous weapons systems — which made us feel like maybe we got the balance right at that point.

Part of the issue is that Defense Department directives are not meant to see the sunlight. They’re written in a super insider-y way for the largest bureaucracy in the world. The Pentagon has never been good about publicly explaining what directives generally mean. We were allowed to do one or two media things when the revision to the directive came out, and then it was back to the normal posture of “the less said, the better.” Not because anybody was specifically opposed to it — that’s just how the system generally operates. Nobody was trying to stifle information or something.

But it means that it shouldn’t take a PhD in autonomy and weapon systems to understand American policy. Just reading the directive and trying to interpret it yourself is sadly not that informative. Or it’s informative, but you could be informed the wrong way.

This says to me that we need either a new policy or some real robust public documentation on what the policy actually means. Either one of those would be reassuring if people understood what it actually said. It’s weird to see your handiwork out in public like that with everybody saying things that aren’t true about it.

Henry Farrell: Like everybody. I wonder how much of this is just a fundamental culture clash between Anthropic and DOD.

The best piece I’ve read about Anthropic and Claude is Gideon Lewis-Kraus’s piece in *The New Yorker* a few weeks back, which really gives you the sense of what it is to be in an organization where Claude actually seems to have a personality, where people are interacting with Claude every day, and where they see their job as being loosely analogous to bringing up a new intelligence.

That may seem extremely wrongheaded, but it feels a little bit like Orson Scott Card’s Ender’s Game. If you take an 11-year-old kid, bring them away and teach them to kill people and manipulate — this is not necessarily something that most parents are going to go along with super happily.

I do wonder — I also think that this is wrongheaded. Equally, I do hope that Amodei is right along the lines that Emmy suggested when he said maybe this will provoke people to start actually thinking about some of the questions of rights, some of the questions of information exchange, and what the problems are that we have created in the society that we live in.

Emmy Probasco: Ender’s Game is a fabulous leadership book, and I believe it’s on the Navy’s required reading list for leadership.

Mike Horowitz: Strongly agree with that part.

Jordan Schneider: Well, maybe we should spend a little bit of time on the political economy piece of maybe not actually doing, but threatening to put Anthropic at the same level as Huawei. Henry, do you want to start with that?

Henry Farrell: Absolutely. This was a remarkably stupid thing for the Department of Defense to do. It was also really interesting for me to see Dean Ball, who is the person who’s more responsible than anybody else for drafting the current US general approach to AI, coming out and pretty directly denouncing the administration and saying that this is evidence of how America is going to hell in a handbasket.

Mike Horowitz: It was really strong. He got really aggressive on it.

Hyperdimensional

Clawed

I. A little more than a decade ago, I sat with my father and watched him die. Six months prior, he had been a vigorous man, stronger than I am today, faster and more resilient on a bike than most 20-somethings. Then one day he got heart surgery and he was never the same. His soul had been sucked out of him, the life gone from his eyes. He had moments of …

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a month ago · 563 likes · 4 comments · Dean W. Ball

Henry Farrell: It’s a really interesting document to read. More or less, he ends up saying — and here I’m paraphrasing — that we need to see more civic activity happening around this stuff because the guiding impetus to a better society won’t come from the government that we have.

This really is an important thing from the point of view of governance. My sense is — and I’m not a standard national security person; when people are talking about different weapon systems, I have no more idea than the next person who reads the newspapers — but if you think about this in terms of economic security and economic coercion, this is the first time that I know of where the United States has really gone all the way to suggest that the tools it uses for coercing other countries and businesses in other countries and designating businesses in other countries is going to be applied to a US. business. As far as we can tell, this is simply for refusing to sign up to changed contract terms.

Like Mike was saying about Iran earlier, it could be that the repercussions of this take some time to really begin to unfurl. But it’s going to have two consequences.

First, it’s going to mean that a lot of businesses in Silicon Valley, once they talk to their legal teams and start thinking through what the odds are and what the potential risks they run might be, are going to be much less willing to get in bed with the US. defense establishment. The risk-to-reward ratio, which used to look pretty great on a lot of fronts, is now perhaps tuned more substantially towards risk than towards reward.

Second, if the DOD wins this fight, it’s going to result in a lot of allies and third countries looking at US. tech companies in much the same way that we look at Chinese tech companies. I remember James Palmer had this fantastic phrase where he said it’s like one of those 1950s science fiction movies where a tech company appears to be independent until suddenly the body snatcher comes in and suddenly it does all sorts of things that suggest it’s acting at the behest of the Chinese state. The same fears are going to begin to bubble up around US. tech companies if they don’t succeed in pushing back and creating a clear zone for autonomy.

In a certain sense, this is returning to some of the fears and worries that happened in the tech sector around the Snowden revelations, when it became clear that there had been a lot more backdoor stuff happening in terms of active cooperation or grudging assent than anybody had known. But this could be substantially worse.

On the one hand, you have the US. effectively trying to push AI development and push the integration of AI into the Department of Defense. On the other hand, you have the US. wanting the rest of the world to use American AI. It seems to me that by emphasizing the first and pushing it to a pretty ridiculous degree, the US. has really hurt itself on the second.

Mike Horowitz: I agree with all of that. If you were a company thinking about doing tech work with the Pentagon right now, and there’s some non-zero chance that if you do a little work with the Pentagon and then decide not to, you might get slapped with a supply chain risk designation that puts you in the same class as Huawei — what does that do to your incentive structure?

This affects a workforce that maybe wasn’t the most comfortable working with the Pentagon to begin with and has gotten there over the last several years. Points that both Henry and Emmy have made at various points in this conversation. Jordan, you’ve heard me say this before — the way their tech proved useful in the context of Ukraine’s defense against the Russian invasion was actually really good for the tech sector’s willingness to work with the Pentagon. They saw that their tools could be used for good to help defend a country against being invaded. But that halo has really fallen off at this point.

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This creates real tension here. There’s not a great argument for why the Pentagon wouldn’t just cancel the contract and find another vendor. Given that both xAI and OpenAI now have deals with the Pentagon to do work in classified settings, it certainly contradicts the need for a Defense Production Act designation. It also implies that the supply chain issues might not be exactly the way the department is talking about them. Who knows? Lawyers will get involved now and there’ll be filings and they’ll say things.

Bryan Clark: Mike, are you saying it’s inconsistent to say your stuff is a supply chain risk, but if you don’t let us use it, we’re going to use the DPA to force you to give it to us? “We want the supply chain risk so bad that we’re going to use the DPA to force you to give it to us.”

Mike Horowitz: But I mean, I’m sorry — Emmy Probasco: No, no, no. I guess this is more of a question than a statement, but how long is this going to take, or how long will it take to affect what we’re seeing right now? There are so many companies in the defense tech space now, and not just in the United States. There’s enthusiasm now around the European market. There’s lots of activity.

Companies that are in it for defense — the new startups that are really excited to be in the defense space — will try to stay in the defense space. It’s the companies in the middle that we might start to lose. The ones thinking, “We’ve got some pretty strong commercial applications. We think we can make a lot commercially. We’ve got engineers who might be more excited about the commercial applications.”

Even then, Anthropic’s still pretty enthusiastic about the national security mission. They just have a problem with a couple of individual points. I don’t know exactly how this is going to rejigger the relationship, but I don’t think it’ll be straightforward.

Jordan Schneider: Well, I don’t know if we can say a couple individual points when you have the president tweeting out that you guys are a terrible company.

Mike Horowitz: Right, it does matter. You can be right about the structural incentives still being there. Anthropic would like to work with the national security community. These companies are really competitive with each other, and Anthropic is like, “Our tools are the best. Of course the military should be using them.” But the vibes are not good right now.

Bryan Clark: Do you think Anthropic uses their relationship with DOD as a sign of how good their stuff is, and then they go to their commercial customers to say, “Our stuff is so good that DOD is using it preferentially”? Does it lend some cachet to them?

Jordan Schneider: I would imagine it runs the other way, if anything.

Look, this is not like a cute machine tools company that makes some stuff for Ford and maybe gets a $10 million contract with some weird corner of the Air Force industrial base. They have so much money to be made. They are growing at 10x a year, and I can assure you that the percentage of that exponential growth which comes from random government contracts is not a relevant number to the future of the company and the future of the valuation.

My assumption is that this was a little bit of patriotism, a little bit of Dario wanting to shape the future of the world, and a little bit of “maybe if we do a good job at this, they won’t screw us on X, Y, and Z other regulatory things.” Curious if you buy that, Emmy?

Emmy Probasco: I don’t know that I can comment on that, but regarding something else that Bryan said — a lot of the companies interested in working with the Department of Defense, when I’ve spoken with them, part of the interest is that the problems are really hard.

If you can prove yourself, it’s not that “if I can prove myself in the defense world, then people want to buy my stuff.” I don’t think that’s true. But if I can improve my tools, if I can improve what I learn on the world’s hardest problems, then I can translate the ability to do really exquisite things into other potential avenues. That’s a more compelling argument.

From what I’ve heard — I’ve never met the CEO of Anthropic, so I don’t know him — but everything we’ve heard from him and from other individuals in the institution is that they’re pretty pro-national security.

Each of these companies has different cultures and ways of talking. They have self-selection where people select into them. It’s significant that when all this started to happen, there was a tech sector website that popped up with signatures from OpenAI and from Google, but inside of Anthropic, it was actually pretty quiet.

Lots of people tried to compare this to the Maven Google movement, and that didn’t really hold. I know we wanted to do that, but in this instance, I don’t think it held. There might have been genuine interest and a genuine concern. I’m willing to accept that as one of the potential reasons this is happening.

Henry Farrell: The notion comes from a fundamental belief that we’re in a battle between democracy and authoritarianism, and we must do everything possible to ensure democracy wins.

On one hand, we see the Trump administration pulling back from hawkishness toward China. This has clearly caused unhappiness and prompted public statements — if I remember correctly — from Amodei about how we shouldn’t be selling chips.

The current administration’s actions in Minneapolis and other places do raise concerns. Amodei’s most recent piece contains implicit commentary about ensuring that existing democracies don’t deteriorate.

There’s been clear enthusiasm at Anthropic to embrace national security in a way that wasn’t true of many other AI companies. Looking at OpenAI, however, it’s much more of a commercial, self-interest story — but it represents a particular understanding of national security that’s somewhat out of favor with the Trump administration.

Getting back to what Mike said at the beginning, my feeling is that this is indeed a pissing competition. Much of this is about not simply egos, but who should be in charge of the world.

There’s a clear sense from many in the AI community that they are the people effectively figuring out the future state of the world. The decisions they make will have consequences for decades. When this runs up against other people who think they’re in charge, it becomes very difficult to find a way through.

Emmy Probasco: For better or worse, my suspicion is that this souring will be very difficult to overcome. The people who suffer are those currently trying to execute operations as ordered by the president — they’re the ones not getting the tools they need. I respect that everyone has their own opinions and we can have disagreements, but let’s not forget who gets affected most.

Mike Horowitz: The winner in the Anthropic versus Pentagon feud is China. If the US national security establishment ends up being deprived of the talent and technology of one of the world’s great and cutting-edge firms, that’s a loss for America.

Without making this political, we haven’t discussed the White House’s views on this matter. Anthropic, uniquely among major tech companies, has been willing to challenge the White House, particularly regarding AI export controls. All AI companies broadly share Anthropic’s view, which differs from NVIDIA’s perspective. NVIDIA sees China as a huge market with customers — they want to sell more chips. The AI companies, however, question why we’re selling these great chips to our competitors. “That doesn’t actually help us,” they argue.

Anthropic has been the most vocal about this issue. David Sacks, who runs AI policy for the White House, has reportedly characterized Anthropic as the “woke doomers” of the current crop of AI companies. While that’s not entirely fair, the point isn’t about who’s right or wrong. The context is that Anthropic was arguably already on the outs with the White House. One interpretation is that they’re being saved by how good their technology is. There’s more at play here than just the Pentagon.

Jordan Schneider: Anyone want to talk about Congress? These seem like issues that deserve legislation, not just directives.

Mike Horowitz: It depends on what you think the concerns are. Emmy did an excellent job earlier laying out all the different kinds of regulations on the use of force. In theory, there’s an entire system backed by federal law and treaties that the US is still part of, governing how force is used. These are designed to ensure, for example, that there’s always human responsibility for the use of force.

Even in a world where the Pentagon didn’t have a policy on autonomous weapon systems, the outcomes shouldn’t be very different because the testing and evaluation system should be functioning. The standards for approving something in the field would remain the same. All AI-specific policies in the Pentagon are really doing is explaining how to comply with broader requirements that exist for everything — whether it’s a bow and arrow, a machine gun, an autonomous weapon system, or an AI decision support tool.

Congress could decide it wants to legislate over this.

Jordan Schneider: It feels more like the war power issues. If we’re sitting here in 2026 talking about “all lawful uses,” when that includes double-tapping on fishers or drug runners — and no inspector general is ever going to investigate that — then that seems like the most straightforward concern. The domestic surveillance aspect — how much we want to superpower the US government — is another issue. We won’t just be worried about querying LinkedIn posts in the coming years.

Henry Farrell: Maybe one way to think about this: as Emmy said earlier and Mike mentioned more recently, many standard considerations regarding AI and national security are really boring, specific things about particular systems — how to use them, what kinds of rules apply, and so on. Congress isn’t currently set up for that debate.

I was really struck by Jasmine Sun’s piece from a couple weeks ago in her newsletter, where she describes visiting various members of Congress. There’s clearly discussion happening between some conservatives in Congress and the “woke AI” people that Sachs denounces. There’s a lot of shared concern about AI’s social consequences.

@jasmine’s substack

🌻 my week with the AI populists

The SFO-DCA flight was not supposed to exist. Per the DCA Perimeter Rule, established in 1966, nonstop flights are generally limited to 1,250 miles from Washington. Meanwhile, San Francisco is 2,442 miles away, nearly twice the permitted boundary. But Nancy Pelosi—our lord and savior—lobbied then-DOT-head Pete Buttigieg for an exemption via the FAA Reau…

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2 months ago · 475 likes · 74 comments · Jasmine Sun

She quoted one staffer who essentially said, “The reason we’re not working with these guys is it’s really hard for us to collaborate with people who are in polyamorous relationships in San Francisco.” You can understand that from a social perspective. But it was also clear that many people were chomping at the bit, thinking this is an opportunity to create a real populist movement against AI.

We’re going to see a big debate on AI in Congress. It’s going to be a weird debate with strange bedfellows. I don’t think it will be the technocratic debate that either the Pentagon or some people in Silicon Valley might expect.

Jordan Schneider: Any other concluding thoughts?

Emmy Probasco: We didn’t talk about China. Isn’t this called ChinaTalk?

Mike Horowitz: I mentioned China a couple times. Look, who’s laughing at us right now? The Chinese. Who benefits from all of this — arguably both the Iran conflict and the Anthropic flight? The Chinese. This is great for them.

Jordan Schneider: You don’t think this is 4D chess? We’re taking the Axis of Evil down. You said it yourself, Mike.

Mike Horowitz: Come on. Sure, that’s right. We’re going to take down the old Axis of Evil and then pivot to Asia.

Bryan Clark: Some of the Iran hawks I deal with over at Hudson are saying this is a way to poke back at China because it takes away their access to oil via the railway they were building with the Iranians. This also removes some of their access to the Gulf. But in the end, this is much more beneficial for China than for the US. There’s not really going to be a lot of upside for us, especially as this thing protracts.

Jordan Schneider: I love how some administration official gave a quote to some outlet saying, “Oh yeah, we’re just in our hide-and-bide phase” like two weeks ago.

Bryan Clark: They just think on very short terms. They’re done with the hide and bide now.

Jordan Schneider: The tech crackdown parallel that I see a few folks making — of Xi getting upset at an uppity Jack Ma for not going along with the program in the way he hoped, having too high a profile, and then blowing up Ant Financial and leaving him to hide under a rock for the next five years and hang out in the plaza in Manhattan where I ran into him on the street in 2023 — is apt but also not apt. Because if they really do the supply chain thing, Anthropic’s going to sue and they’re going to win.

From a rhetorical perspective, doing this is really jarring. But there is a difference in the powers that Pete Hegseth or David Sacks or even Donald Trump has, as opposed to someone like Xi when they try to do a tech sector crackdown. It’s clearly pretty terrible atmospherics, which we talked about for the past 80 minutes or so. But I do think it’s a difference in degree between just “oh, let’s pick a fight with this guy because he’s a shit lib,” as opposed to “oh, we’re going to throw him away and run his company out of business,” which I don’t necessarily think is the glide path that the president could take us on, even if that’s really what they decided to do.

Emmy Probasco: I was actually making a slightly different point, which is, while we’re having this argument, China continues to work hard at work. Sam Bresnick, Cole McFaul, and I just finished a piece that looked at all the different experimentation they’re doing, not just with large language models, but all sorts of different applications of AI. It’s pretty comprehensive. They really didn’t miss anything and they’re talking about it pretty openly. It’s frustrating to see all of this happening and think that we are in a competition here and we’re having what seems like an argument that got out of hand as opposed to making real progress.

Eight hours to the deadline. We break down the standoff, then get into the Cuba boat raid, Iran, and four years of war in Ukraine.

Jordan Schneider, Eric Robinson, Tony Stark, and Justin Mc

Today we cover…

• The Anthropic-Pentagon showdown: what Hegseth actually wants, the Maduro raid Claude controversy, and why Dario’s position is more nuanced than “no kill bots”

• Domestic surveillance: FISA, NSA, and Eric’s story about getting a call from the Department of Justice

• The Defense Production Act as a magic button — and why Congress is starting to push back

• Military-civil fusion, American style: are we becoming the thing we critique?

• Florida Man tries to invade Cuba with 10 guys on a 24-foot boat

• Iran: the naval strain, Witkoff and Kushner as our top negotiators, and the near-miss in Venezuela

• Ukraine at year four: European rearmament, the shadow fleet, and whether the 5% NATO target is designed to humiliate

• The Secretary of Defense problem: from Lloyd Austin going missing to Pete Hegseth’s Make-A-Wish Foundation

Listen now on iTunes or Spotify.

Claude Goes to War

Jordan Schneider: So I had Claude Code build me the Claude of War, — a responsible approach to killing people. At least it has a sense of humor about it!

Happy Friday, February 27th. We are now eight hours and counting from the 5:01 deadline that Pete Hegseth set. Eric, take us away.

Eric Robinson: So why are we talking about Anthropic? It is one of maybe a half dozen industry leaders in generative AI and large language modeling. If you had asked about it maybe nine months or a year ago, I don’t think it would necessarily be spoken of in the same sentence as OpenAI or DeepSeek, but they have been on a breakout run — primarily because Claude has demonstrably shifted the way people interact with AI-enabled coding.

The tension at the moment is that Anthropic has, for reasons that remain unclear, caught the hostile attention of the Secretary of Defense. It does seem to be almost a personal mission that Pete Hegseth has taken on.

Jordan Schneider: We’ve got a few dynamics going on, and I think we should start with the inauguration, where you had Sam Altman and the rest of the tech CEO elite all there with big smiles. Greg Brockman donating $25 million to the Trump super PAC. And then Dario kind of on the sidelines — he’s missed some of these meetings. I think it’s clear that his politics don’t necessarily align with where this administration is. That was fine. David Sacks made fun of them for being “woke AI.”

But as Eric said, it’s all well and good until this is the market leader, which they have been for the past six months, in a sort of ironic twist of fate. The market leader is the one with the most federal ramping going on. Anthropic that was most integrated into the various things the Department of War gets up to.

Anthropic tried to kiss the ring. It was reported in The Wall Street Journal that they asked 1789 Capital — Donald Jr.’s VC fund — to get in on their last round. Donald Jr. said no. And now the knives are out.

Tony Stark: There are two sticking points here. One is the “don’t put us in kill bots” thing, which we can talk about at a technical level. But there’s also the “no domestic surveillance” part, which is the part where everyone — even friends on the Hill — are like, “Hey, that’s kind of weird.” I would like to know, and I think the public deserves to know, more details about what this fight is specifically about.

Look, if you have contracts with defense contractors or with the DoD, I hate to tell you this, but the DoD is going to do DoD things. If your frustration is that your model is being used to support warfighting operations where people die — I’m not familiar with many warfighting operations where people don’t die.

Justin Mc: Humanitarian missions.

Tony Stark: Well, yes. But I think there are some issues about what business you were getting into.

Jordan Schneider: Here’s the nuance. The way I read the blog post is not that they are categorically opposed to their model killing people. It’s more like: look, it’s not ready for game time. We can do cute things around the edges, but the downside risk of putting our models at the very pointy end of a kill chain is likely to get the wrong people killed, or even get our own people killed.

The analogy I’m going to is almost a reverse Arthur Miller All My Sons, where they’re selling something qualified to go 200 miles an hour, and the DoD is like, “No, we’re going to have it go 400 miles an hour.” But it will just fly apart. And they don’t want to be a part of that.

Tony Stark: That’s fine. But for the audience here — there are basically two types of AI for the DoD. There’s AI in the bot or in a control node for the bot, which is autonomy for perception to do on-the-loop operations. Per DoD Directive 3000.09, it states pretty explicitly what you can and cannot do when it comes to these machines. So unless we’ve rewritten the directive, the guidance for the Pentagon is still 3000.09.

Then there’s AI at the higher level — the C2 echelon — where you’re controlling a bunch of things, controlling logistics, or doing planning. I don’t really know specifically what the instance with Venezuela was, where Claude fit into that. Who knows — Claude could have just been making maps.

Eric Robinson: Yeah, it was probably an information operations officer who queried Claude and said, “Hey, give me the top 10 Spanish-language broadcasts that are going to speak up about this,” which is perfectly responsible. You can say that on the margins it supported the operation, but there’s no MH-47 crew chief or pilot using Claude to do a load plan.

Tony Stark: You can’t just dump an LLM like Claude into a warbot. It takes a lot of work, and that’s not what’s happening here.

Justin Mc: I think you’re also seeing a bit of that personality difference — Amodei and Anthropic versus, say, at Palantir, who will sell a 20% solution and say “this thing will revolutionize warfare.” That’s a very important distinction. You have a person who’s very cautious, saying, “I don’t know that this is going to fit the parameters of what I’m being told it can do. I’m going to be truth in advertising. I’m uncomfortable if that’s where you’re saying this is going today.” That just sounds like a more frank discussion about how things are getting used.

When you couple that with the other thing — Anthropic is now a defense contractor whether they want to be or not. They have sold something to the Department of Defense. And this defense contractor is telling the truth. That’s novel. That’s a cool break in tradition.

The DoD could just say, “Yes, of course we’re not going to conduct surveillance on Americans — because of Posse Comitatus and the FISA court rulings and all the other things that say we can’t do that unless there is a warrant.” Then you take away both of Amodei’s complaints. But instead we have an ultimatum where it’s: “No, I don’t want to tell you anything. I don’t want to say that I have any restrictions.”

Tony Stark: I think this is, at minimum, a case of egos.

“Our Product is TRL 5”

Jordan Schneider: Let me read Anthropic’s paragraph on fully autonomous weapons. This is from a Dario statement from yesterday:

Fully autonomous weapons. Partially autonomous weapons, like those used today in Ukraine, are vital to the defense of democracy. Even fully autonomous weapons (those that take humans out of the loop entirely and automate selecting and engaging targets) may prove critical for our national defense. But today, frontier AI systems are simply not reliable enough to power fully autonomous weapons. We will not knowingly provide a product that puts America’s warfighters and civilians at risk. We have offered to work directly with the Department of War on R&D to improve the reliability of these systems, but they have not accepted this offer. In addition, without proper oversight, fully autonomous weapons cannot be relied upon to exercise the critical judgment that our highly trained, professional troops exhibit every day. They need to be deployed with proper guardrails, which don’t exist today.

Eric Robinson: He’s saying his product is TRL 5. In acquisition speak, he’s giving a fair assessment. I think Justin triggered something really important: among the Stargate participants and the inauguration attendees, saying “I’m not ready” is culturally weird, because you’re supposed to say you’re going to be driving cars on Mars in six months.

Justin Mc: And when the leader — very clearly in some key categories the leader of AI development in the US — is saying “this stuff is not ready for what we’re saying,” that’s a cultural push that is different than what the DoD has been encountering. I worry that is also driving some of this. They want everybody to get in line because that is more in line with what the administration is saying about capabilities.

That’s the real danger of Anthropic coming out and saying “this stuff’s not ready.” If we’re top of the line, this stuff’s not going to do what we think it’s going to do.

Tony Stark: Back to the C2 thing — that does matter. If Claude is being used for command and control at a higher echelon, and something goes bad, you’re responsible for a mass casualty incident or a war crime. I think it’s smart on Anthropic’s part to fight that.

Justin Mc: “The pod made me do it.”

FISA, NSA, and a Call from the Department of Justice

Jordan Schneider: Can we do the domestic surveillance angle? What domestic surveillance does the Department of War do?

Tony Stark: Well, NSA is weird.

Eric Robinson: It goes through NSA. The department has certain intelligence collection authorities that are supposed to be internationally oriented, but there are support-to-law-enforcement missions. There are bundles of authority out there that the department can employ in a variety of different circumstances.

Justin Mc: During the protests — both during Trump One and then some of the No Kings protests at the beginning of Trump Two — there were reports of Air Force drones doing surveillance over the protests.

Eric Robinson: That was CBP in Minnesota.

Justin Mc: Right. And the courts already said, “Yes, that was legal, but we need the guidance to be more defined.” Because while technically they were within the bounds of the law, the courts didn’t agree that was the intent of the law going forward.

We have an intelligence apparatus that, yes, uses manpower from the DoD, but overwhelmingly that’s through warrants, not just because the DoD decides they want to do collection or surveillance on Americans.

Eric Robinson: If you’re covering a US person, it should be covered under FISA rules.

Justin Mc: Even if you’re overseas at embassy functions and you meet an American citizen living abroad — there are all kinds of restrictions on how you collect, how that person is safeguarded, how their identity is protected. Those apply to the DoD and the intelligence services writ large. That’s even external to the US. You come back inside the US, the FISA court is conceivably a bulwark against massive internal surveillance.

Eric Robinson: To illustrate that exact point: when I started at the National Counterterrorism Center about 15 years ago, I was kind of a low-level analyst. I moved into being an intelligence briefer. We had a pilot program that Attorney General Holder had negotiated where certain analysts at NCTC would have access to all of CIA and NSA reporting, but we would also have access to a substantial amount of FBI reporting. We had the Gorgon Stare, both domestically and internationally.

I was part of a small team that had access to raw FISA collected on US persons overseas — you could get like their Facebook pages or whatever. It was highly controlled. We had to go through very special training to gain access.

One morning, it was a little bit slow. I queried some raw files related to some other reporting — didn’t find anything interesting and just moved about my day. When I was done with my morning briefings and back at my desk, I got a call from the Department of Justice. They said, “Hey, we noticed you ran these queries, and we’re going to talk to you about it because this is unusual behavior.” I had an attorney from the National Security Division inspecting my queries because there was a recognition that what I was doing required an extraordinary degree of oversight.

I was completely above board. Granted, I never queried raw FISA again because I didn’t want to talk to a Department of Justice attorney. But the system is supposed to have guardrails.

Something we have to thread through the discussion with Anthropic, targeted killings in the Caribbean, or a forthcoming military campaign in Iran: there’s not really a functioning Office of General Counsel at the department right now. That OGC is not taking an adversarial look at the actions of services and components. It sees itself as a personal law firm on behalf of the Secretary and, to an extent, the Deputy Secretary.

When I make references to normal intelligence collection guardrails, I am sympathetic to people like the head of Anthropic and other defense contractors who recognize that there is no legal architecture governing what they’re being told.

I was speaking socially with a fairly senior representative of a defense prime recently, after the Supreme Court struck down the president’s national security tariffs. FedEx has gone public saying they want their rebates. A few other companies are trying to advocate for the same. What I’ve heard is that there’s been a network of asks under the table: “Hey, Pentagon, pay us back for these tariffs.” And the Pentagon, without any sort of legal review, just says: go fuck yourselves. Eat shit, American industry. This is part of the golden age. Get ready.

What we’re seeing with Anthropic or the targeted killings in the Caribbean — it’s all part of the same ethos of “eat shit, you’re not on the team.”

Art of the Deal, DPA Edition

Jordan Schneider: The underlying thing is: if you don’t trust these people to do above-board things with your technology, you’re going to want more understanding of what it’s being used for. Anthropic is trying to meet them halfway. He could have just canceled all the contracts January 21st. But being told “no” ever, or “let’s discuss this” ever, is not part of the ethos of this administration or this Department of War.

Tony Stark: This is where I start to get concerned about the discourse. If they go forward with this, there’s going to be a lot of legal hearings, congressional hearings. Defense tech is going to be hurting.

But there’s a broader issue: this is the first time since Kath Hicks announced Replicator that the public is getting a look at how the department intends to use autonomy. This is not good for us.

My major concern is that I’m already seeing the social media discourse of “Pete Hegseth’s Pentagon wants to use robots with no guidelines,” which is not true. That’s not what defense tech wants. That’s not what most of DoD wants. It’s probably not what Congress wants. Foreign partners don’t want it.

If that discourse runs into midterms and you get a backlash, I am very concerned about what that means for the things we actually need on the battlefield. And it also means any reasonable discussion about how we use AI in the future probably goes out the window.

Justin Mc: Modern warfare, as we’re seeing in Ukraine, is highly electromagnetic-spectrum contested. Radios and com links are jammed, GPS is denied. It’s very difficult and hazardous to your health to communicate because of jammers, spoofers, locators, and rapid artillery barrages fired on emissions. So there does become a point where when we say we’re going to enable weapons with on-device, on-edge compute capabilities, we are admitting there is going to be some form of autonomy. What we have to hope for is that by the time they lose that link, it is refined enough to make a good decision — they know the difference between a tank and a school.

If we’re already at the point where one of the leaders in this field says “I have reservations,” and then the Pentagon says “we don’t want any guardrails” — not even saying “we think we have a system in place for the guardrails, the way that we do collateral damage assessments, and Anthropic, we’re going to put you on the oversight board as we experiment with autonomy at the edge” — that becomes a very different conversation. The narrative right now is: you don’t get to set guardrails, there are no guardrails, we get to use it however we want. That’s rightfully scary to a lot of people, even within the defense industry.

Jordan Schneider: It’s already metastasizing. We have an open letter — notdivided.org — with a few hundred researchers from OpenAI and Google saying, “Yeah, we’re not so cool with this either.” This conversation has clearly broken containment beyond the Second Breakfast listener base.

Eric Robinson: And since we started speaking, The Wall Street Journal just ran a report that Sam Altman has convened an all-hands and has decided to broker a truce between Anthropic and the Pentagon.

Jordan Schneider: They can’t even hold hands!

Eric Robinson: And Emil Michael, the Undersecretary of Defense for Research and Engineering, has waded in and said Anthropic has nothing to worry about — mass surveillance is unlawful under the Fourth Amendment.

Tony Stark: That’s Congress calling DoD and being like, “What the hell?” Probably the White House too, honestly. There’s this weird thing where obviously a lot of this administration doesn’t want guidelines, but a lot of them still grew up in the space of “domestic surveillance is very bad.” There’s that weird contingent of the people who want to do everything versus the people who are like, “This is not the libertarian conservatism I was raised on.”

I expect to see a pretty big split in the administration on this. And there’s already a split between Pete and the White House.

Jordan Schneider: There’s also the “let’s not bust the AI bubble” angle. You’re going to label the most important company in the world a supply chain risk before you label Alibaba or Tencent? Come on.

Tony Stark: Yeah, let’s continue to sell chips to the Chinese while labeling Claude a supply chain risk. That’ll go great.

Justin Mc: We’re going to note that we know DeepSeek was trained on Nvidia Blackwells and not do anything about it, but we’re going to blacklist Claude. Cool. We have our priorities in order.

Jordan Schneider: There’s some chunk of this administration that is still very much not on board with selling chips to China. They’re like, “Yeah, Inner Mongolia, we see you DeepSeek — cute stuff you guys are doing.” Dario has more China hawk points than Pete does. He’s been screaming about export controls for a long time. They’re banning Chinese users. They put out a report calling out Minimax, Moonshot, and DeepSeek for trying to distill their models.

The DPA as Magic Button

Jordan Schneider: Let’s walk through this scenario. What does the Defense Production Act allow you to do?

Eric Robinson: DPA these days — especially at this Pentagon — is effectively God in a box. It’s their deus ex machina: slam DPA and get results. The MP Materials transaction from July, where the Pentagon took a $400 million preferred stock position in a publicly traded company — that was a DPA button. A DPA does not exist for that, but the Pentagon’s Office of General Counsel said “go ahead.” They have a pattern of using this Korean War-era legislation to intervene in the American economy in new and inventive ways.

Tony Stark: The DPA is broad enough that you could drive a truck through it. But it was always written as a gentleman’s agreement in the sense that you can press a lot of economic buttons, but there will always be economic and political feedback. Which is why people have been very selective about invoking it over the last 70 years.

It gives you a lot of potential, in the same way that if I put a V8 in my car I can drive really fast. However, I would not recommend doing that on the streets of DC, because I will crash. That is what you risk if you really go hard with DPA authorities.

Jordan Schneider: Fun fact — we’re going to have a DPA renewal. There’s a stopgap expiration to September 30th of this year. I don’t think this renewal will be the low-key nichey defense topic it usually is.

Eric Robinson: This is a rare moment where the Senate Armed Services Committee and House Armed Services Committee are actually putting some screws to the Pentagon. If we go back to some of the deal-making at the Deputy Secretary’s office, they originally wanted long-term commercial offtake agreements with mining companies for their critical minerals campaign. Congress effectively said, “We do not approve of decade-long purchase agreements for rare earth elements. This is not DPA authority.”

That led to the administration using other vehicles — Project Vault with the Export-Import Bank, trying to come up with an international system within the G7 for a tariff-based price swap, DARPA launching a commodities market. You’re seeing one instance of Article I authority being used to check the administration’s ambition. And it is on what is ultimately a $6 billion market — small potatoes.

Justin Mc: They’re talking about DPA and labeling Anthropic a supply chain risk. Those are two distinct labels and uses. DPA says “we want unfettered access and we should be able to use this however we want.” Labeling them a supply chain risk says “nobody can use this because we see this as an existential threat with the ability to be used for coercive purposes.” The department has said both. And it’s like — what does it mean?

Jordan Schneider: It’s just big toxic. It’s a giant toxic relationship, which I don’t think this leadership is unfamiliar with. We have this quote in Axios basically saying the only reason they’re giving Dario the time of day is because he has the best model — which is true. And by the way, if you don’t want to marry us and sign without a prenup and move to the hills and cut yourself off from all your other relations, we’re going to try to throw you in jail.

Eric Robinson: “That’s a nice $300 billion company you got. It’d be a shame if something happened to it.” It’s like Fat Tony from The Simpsons.

Justin Mc: It’s funny that you just made marriage and a cult sound exactly the same.

Military-Civil Fusion, American Style

Tony Stark: I’ve seen several people cite this as “our version of military-civil fusion.” For those who don’t know, it’s basically the Chinese model of: hey, you have these companies, they build great things, you belong to us, gimme. By doing this, we are mirroring what the PRC does to its companies — putting the boot on the neck and saying “you will do what we say or you’re not going to have business in the United States.”

That’s basically what labeling Claude a supply chain risk would do. Nearly every major company, defense tech or not, touches the DoD or the US government in some way. That’s a very scary moment for free enterprise.

But here’s the thing: we know the military-civil fusion model doesn’t work in the long run because it kills innovation. You might get it at the outset, but it doesn’t sustain itself. I think you already see that with workforce burnout in the PRC. And that’s in a culture that has been under a regime for decades. The culture here is not going to survive that.

Justin Mc: If one large corporation acqui-hiring one small startup was going to “destroy the innovation ecosystem,” what do you think happens if we destroy Anthropic because they decide they don’t want to play ball?

Tony Stark: I see a lot of friends on the left saying “nationalize X company” as a punishment. I hate to tell you — SpaceX is not SpaceX if you nationalize it. It’s NASA. And if you’ve looked at NASA’s production rate lately, it’s not doing so hot.

Justin Mc: The horseshoe theory is more apparent every day. Both sides just meet at the bottom, and it’s “nationalize everything.” Can we just keep the capitalism thing going? It’s worked pretty good so far.

Eric Robinson: I think the coziness between government and private industry is not new. The employment of a cudgel, like what the Department of Commerce did with Intel, is distinct and troubling. It’s going to cause market inefficiency and a process of thematic alignment with political power centers that is fundamentally opposed to the traditional concept of federalism and divided powers. Companies have to conduct themselves on the whim of the presidency, rather than doing what’s best for their stockholders, communities, or employees. I think it all ends in tears, but we’re going to get more t-shirts with “Made in America” stamped on the inside out of it, so I guess it’s probably a wash.

Florida Man Invades Cuba

Tony Stark: I want to talk about this week’s Florida Man. Ten Cuban nationals from Florida who tried to invade the islands.

Eric Robinson: The Comoros Islands campaign of Margaret Thatcher’s son — showing up and trying to overthrow the Castros.

Tony Stark: For those who haven’t seen it: it looks like Marco Rubio missed his best opportunity to invade the island, because 10 allegedly drunk people from Florida with bulletproof vests, rifles, and IEDs — according to the Cubans — got on a 24-foot boat. For those who don’t know, it’s really hard to fit 10 people on a 24-foot boat. They sailed to Cuba, allegedly shot first, and the Cubans shot four dead and injured six others. Even Marco Rubio’s actual quote was like, “That’s weird.”

Eric Robinson: How drunk do you have to be to keep your buzz going for the two-hour trip?

Justin Mc: You take the drinks with you. I don’t understand the question. Sorry, it’s Florida.

Tony Stark: But where do you fit the drinks?

Eric Robinson: If you’re loaded up with fuel, 10 extraordinary doofuses, and a basic load of ammunition — at a certain point, something’s gotta give.

Justin Mc: I think we missed the inverse. They probably also had cocaine they were taking to Cuba.

Tony Stark: And you know, this would have been a great opportunity for us had we not put all our air power in the Indian Ocean.

Justin Mc: And Marco Rubio is currently in the running to be the next leader of the Sinaloa cartel. The memes that have been coming out this week are amazing.

Tony Stark: I thought he was going to be a board member of Anthropic.

Iran and the Near-Miss in Venezuela

Jordan Schneider: Nothing has happened with Iran since last week’s show. We’re kind of twiddling our thumbs. What if they actually bomb Iran at 5:02 — the minute after the Anthropic deadline — in order to use Claude for the targeting?

No, you do it at 4:59. You use Claude, and then you say, “Now you guys are restricted. Gotcha.”

Eric Robinson: It is a reflection of the increased residentialism of American politics that the two point people leading the negotiations with the Iranians are Steve Witkoff and Jared Kushner. They have no formal training. They have a multitude of business interests that come first. They are effectively the trigger point between this relative moment of peace and a renewed war between the United States, Israel, and Iran.

It’s absurd. It’s another part of the DOGE-era direct attack on government professionalism. It’s downrange from a culture of “government can’t do anything right.” It’s not just whether a chicken processor in Maryland is being effectively monitored by the FDA. It’s making countries rise or fall in warfare. There are two to three hundred combat aircraft coiled to start moving against Iranian targets for reasons that have not been articulated to anyone outside of the president and his inner circle. When you say it out loud, it is an extraordinary indictment of American political culture.

Tony Stark: There was an article in the New York Times about how these Iran deployments are starting to bend and break the naval force. The Iranians can reach out and touch us — the Chinese are selling them more YJ-12s, with roughly a 200-to-300-kilometer range. The threat of retaliation this time around seems more serious.

Justin Mc: I also wonder if the risk calculus has changed now that we know, after the State of the Union, that Venezuela was not the clean in-and-out that was claimed. We were a few bullets in slightly different locations from losing an entire Chinook full of Delta operators. That should have scared the shit out of the administration.

Tony Stark: The world looks a lot different if those bullets are a little bit left, a little bit right.

Justin Mc: The 160th is amazing. Those pilots are amazing. But if that Chinook goes down, it’s Black Hawk Down with Delta operators in the middle of Caracas. Then you have SEAL Team Six that has to respond. The world changes dramatically.

Now we’re going to take not the most exquisite and prepared force in the world to go do a discrete military operation — we’re going to go do it in Iran, which has integrated air defenses. How much suppression of enemy air defense aircraft do we have? How much capability do we have to continually fly Growlers and electronic warfare aircraft? When do we lose something? It is a hard problem.

Last week, a report came out where General Cain was basically saying, “I don’t think this will be as easy as everybody thinks.” He had expressed concerns within the administration.

Eric Robinson: Both the Journal and CNN had independent versions of the same theme. The chairman understands the mechanics of these operations. When I worked for him, he was a one-star at JSOC. He knows it intimately, and he’s a fighter pilot. He’s like the last military professional who’s there. He is probably a lonely voice who’s going to be asked to depart. This operation is going to go forward whether he likes it or not. He’s sufficiently sophisticated to understand that at a certain point he was going to be put in a Mark Milley–style situation where he was going to have to put his rank on the line. This is him making it known. And he’s going to lose the argument.

Ukraine at Year Four

Tony Stark: It’s now four years into the full-scale war in Ukraine — twelve years since the Russians first took Crimea and we did nothing about it. UK MOD reports 1.1 million Russians killed or injured. Ukrainians are somewhere in the hundreds of thousands. Millions displaced. Trillions of dollars of economic damage.

We’re no closer to a resolution. It remains unclear who retains the advantage on the battlefield. The Ukrainians can still carry out local tactical counteroffensives at the battalion level. The Russians keep throwing human waves at it, which is going to break their force at some point.

I am reticent to say Ukraine is an entire American policy failure because Ukraine is still there, and had we not helped, it would not be. I will say the policy failure was misunderstanding what it takes to fight the Russians and then having an over-obsession with nuclear war every time the Russians said the word “nuke.”

Justin Mc: It’s not just a US policy issue — it’s a European one. How long did it take the Germans to stop buying LNG from Russia? How long did it take to sanction all the banks? Europe, which had the most on the line and you’d think would have drawn the harshest line, was not ready because of the leadership in Germany.

Now you see fracturing within the EU. The Baltic States are saying, “The EU probably isn’t going to help us. The Americans may not help us. We’ve got to help ourselves.” Poland is on the “we’re going to protect Poland first and foremost.” Meanwhile, you have a simultaneous rise of Putin-friendly-ish central European and western European governments.

Tony Stark: The inconvenient truth for the Europeans is that the reason they can have a wonderful social safety net is because of American extended deterrence. The Russian threat is back, American extended deterrence — who knows? Now politicians are caught between risking the return of militarism to Europe or basically bending to the Russians.

I really think Europe is going to hit a political breaking point soon. And the populations are not going to like it.

Justin Mc: They may have to work 40-hour work weeks again.

Tony Stark: See, that’s true fascism.

Eric Robinson: There are indications of a renewed spirit. If you look at military aid to Ukraine in 2025, Europe has made up for American abandonment. Is that sustainable? It’s uncertain.

There’s also the issue of sanction circumvention. Wonderful infographics about Kyrgyzstan suddenly receiving more luxury German sedans than any other country in Asia — pure sanction circumvention where you export to Kyrgyzstan and then the Russians still get their slick autos.

There are other indications beyond the Baltics continually telling the truth. The Bundestag is starting to look at additional efforts to increase German defense readiness. Will all of this balance to a better European-wide readiness? It’s a maybe.

Twenty years ago, Europe was in a breach with the United States over Iraq. The European Union response was to create EU battle groups — ad hoc task forces of 1,500 soldiers that were allegedly available to deploy internationally on a moment’s notice. It turned out they were nonsensical, like a weekend with your ROTC battalion. They didn’t take it seriously because fundamentally they didn’t have to.

The stakes are different now. Nobody went to Munich and gave a speech like Secretary of State Rubio did. There is a recognition of American unreliability, and that despite the grievous casualties the Russians have suffered, their rate of artillery production has recovered. They’re conducting directed sabotage in Poland, against commercial airports in Denmark. The Russians, even with a bloody nose and a broken leg, have not given up their imperial designs.

I think Europe is recognizing the paradigm shift. What I’m fearful about is that it’s not necessarily going to be fundamentally good guys like Emmanuel Macron leading the charge. It’s going to be far-right actors saying “Europe first,” with profound ugliness directed against migrants and immigrants. Europe may rearm and be a more formidable conventional threat, but that doesn’t mean their bayonets are going to be pointed in the right direction.

Justin Mc: Even the American argument — “they don’t pay their way” — the US hasn’t met its own 5% commitment to defense spending for NATO since 1993, with the exception of two years during the Iraq war.

Eric Robinson: It was 2% forever. The 5% is just designed to humiliate the Europeans who are trying to cooperate.

Justin Mc: In Poland, Tusk is like, “Well, we’ve got our 5%. Where’s everybody else?”

Tony Stark: The Greeks spend like 4.8%, but most of that’s on pensions and corruption, so it’s a stupid metric regardless.

Justin Mc: The Greeks also spend like three times that funding the shadow fleet to move oil to Russia. Nobody’s talking about that either.

Eric Robinson: Let’s give credit where it’s due — the shadow fleet enforcement is a rare administration win. The Shadow Fleet is shorthand for a broader network of illicit tanker ships that fly under a multitude of national flags. They enter a port, turn off their transponder, change their name, have false bills of lading, crews who “didn’t see nothing.”

Some of the most egregious violators have now been subject to Coast Guard or Naval Special Warfare inspection, often led by the United States or in partnership with Britain. It’s long overdue.

But it goes back to a recurring theme: the war opened up four years ago, launched in 2014. If you’re going to do sanctions, do sanctions. The Biden team and the Obama team had assets. They had the ability to enforce these sanctions and elected not to. Democratic officialdom needs to answer for it.

The Secretary of Defense Problem

Eric Robinson: The Trump team, especially around the Pentagon, is able to move with such speed and aggression because they weren’t standing on much. The Austin era of the Pentagon was a series of formal delegations to the Shangri-La Dialogue and a nicely prepared speech at the Reagan National Defense Forum — and who gives a flying fuck about any of it?

Justin Mc: To be fair, Secretary Austin went missing for 25 days before anybody noticed.

Tony Stark: What was wild was that right after that news, I had a conversation with some politicos affiliated with the administration who were not in defense, and they were like, “What?” They had no idea the SecDef went missing and the DepSecDef was like, “I’m in Puerto Rico, the DoD can’t talk. There’s no way anybody can reach me on a plane, so I’m just going to stay on the beach.”

Eric Robinson: Secretary Austin had a substantial amount of military experience. In normal American politics, he would be a plausible candidate. But if you spent substantial time around him, if you witnessed the ebb and flow of the early phases of the counter-Islamic State war in 2014, you recognize he was not up to the task.

He was an interesting pick by President Biden for a few reasons. One, statute is supposed to ban this — you’re not supposed to be able to pick Jim Mattis or Lloyd Austin without an exception. Two, he did not have a reputation as a particularly adept strategic thinker. Three, he had no DC presence at all — no time at think tanks, no academia, no staff, no aides he could bring into the Pentagon. And fourth, he sort of got the position because he would go to mass with Beau Biden and the president saw a familial connection.

So he arrived at the Pentagon like a guy with a briefcase. He didn’t have a chief of staff to bring. He got staffed from Center for American Progress and the Truman Project. They went real far down the list for key developmental positions because he was just a professional island.

When he got extremely sick and left Kath Hicks on a beach in Puerto Rico holding the nuclear codes, it was a direct result of bad staffing. We are lucky that we didn’t have catastrophe come out of it. We only got a set of small disasters.

Tony Stark: He took everything personal. When Congress came around after he was voted in and said maybe we should change the law about putting generals in as SecDef, he took personal offense. He thought it was about him and people not liking him, not the fact that between him and Mattis, we’d had two generals in the past eight years.

Justin Mc: If you get offended by that, you’re actually telling us you aren’t qualified for this position. Because that exact reaction is why we’re worried. We need you to be able to look at people who grew up underneath you, who were part of your coaching tree, and tell them “no, that’s wrong.” It’s much harder when it’s your protégé.

We’ve now gone so far afield. We have somebody with absolutely no insight who also doesn’t have the DC presence — is an island unto himself, has to attach himself to the president, and can’t have a divergent opinion. Which is what makes the Anthropic thing so interesting: is this where the administration is on tech? Or is this Hegseth intuiting where he thinks the administration is?

Tony Stark: And on that terrible note, we’ll see you all next time.

Eric Robinson: We’ll see if Sam Altman can pull us back from the brink of an Anthropic disaster.

Justin Mc: The Wall Street Journal just released that federal officials have concerns with xAI. Multiple federal agencies. Notably, it doesn’t lead off with the DoD.

Jordan Schneider: I mean, they fucking should.

Eric Robinson: Yeah, of course. The child pornography development tool is somehow noxious? Of course.

Justin Mc: It says multiple federal agencies. Notably, it doesn’t lead off with the DoD having expressed concerns.

Jordan Schneider: Maybe they’re less crazy than we thought!

is the dean of strategic studies and now writes a foreign affairs Substack This is part two of our discussion.

We discuss:

• The creative and aesthetic considerations of historians — the good and the bad.

• What H.G. Wells and Joseph Conrad can teach us about style and strategy.

• The necessity of historical context when evaluating present-day conflicts, like Putin’s invasion of Ukraine.

• The often-overlooked role of fatigue in decision-making.

• How strategy is less deliberative and more chaotic than historians often let on.

• The value of “scavenging” when writing contemporary histories.

• Why military historians are not always the best commentators.

Have a listen in your favorite podcast app.

Do note we recorded this in the summer of 2023 (thank you AI for fixing the audio finally!).

Lessons from Ukraine

Jordan Schneider: Andrew Krepinevich, one of the originators of the concept of the “revolution in military affairs” recently said that people expected Russia’s invasion to be a second Desert Storm, but what we’re getting is a second Iran-Iraq War.

One year in, what is your takeaway about how the revolution in precision and information technology has played out?

Lawrence Freedman: Maybe the Russians thought it would be a bit like Desert Storm, but it was pretty clear quite early on it wasn’t. It’s not really Iran-Iraq either, though I can see more similarities. By and large, the lessons from Ukraine are not that surprising, which is one reason why it’s possible to follow it.

Defense tends to be stronger than the offense.  

To have success in an offensive requires that either you’re facing a thin defense, or you’ve thinned it out yourself. That’s quite hard to do without air power. Both sides have found that quite hard. It tends to attrition, and that's what’s happened. 

If Ukraine is able, as I would hope, to make breakthroughs in its offensive, it will be because of superior equipment and tactics, and because of motivation. Soldiers know what they’re fighting for. I don’t think the Russian soldiers do. These are all things you could have drawn from earlier conflicts.  

There are aspects of the war — including the Russian attacks on critical infrastructure now most randomly on towns and cities — that don’t reflect any particular understanding of what these tactics have achieved in the past. You can’t wholly write off the attacks on critical infrastructure because, last December, they got quite close to succeeding. Ukraine was in a difficult position, but it got through.

Then, you get into issues of the quality of air defenses versus striking air power and missiles. These are all issues that anybody who follows modern conflict knows pretty well. Now, drones are a new aspect, at least in the way that they’re being used, particularly lots of cheap drones. You can see the role of information and communications networks and their importance in linking fulfilled intelligence with the ability to strike targets as and when they appear.  

There’s all sorts of interesting stuff there. I’ve been trying to write on this.

I keep on coming back to the thought that a lot of what’s going on wouldn’t surprise anybody who’d been through the Second World War.

Once they were updated on the technology and a lot of that is just a variation on technologies they would have known quite well, and they would have worked it out quite quickly.  

Was it stupid? Starting a war on the basis of political prejudice is what Putin did. It’s cost the Ukrainians dearly. It’s appalling what’s happened to Ukraine. Every Ukrainian I know has lost somebody or lost friends.

But it’s done terrible damage to Russia too.

Everything that [Putin] thought he might have achieved in the first couple of decades of being in charge has been lost. The economy has been set back. Nobody wants to invest in Russia anymore. A lot of its brightest people have left the country. Their military machine will take years to revive again. Obviously, they've still got an air force and a navy, but their army has had a torrid time.

Starting a war without a clear plan to conclude it — a realistic plan to conclude it — and checking that real plan against all the best advice would lead you not to do this.

The political lessons are always the most important. Too much discussion of strategy, whether military or otherwise, ignores context, assuming there are some rules you can apply that would bring you victory.

You need to understand the context in which you’re operating. Putin didn’t. 

War & Collective Amnesia

Jordan Schneider: What is it about humans that we can’t appreciate how stupid wars are? Why do we have to keep relearning this lesson?  

Lawrence Freedman: Well, we all make mistakes… There’s a word, meshugaas, which is a Yiddish word for getting an idea in your head that is bonkers. Putin is fixated on Ukraine now.

Now, he’s not alone. The first time I heard a Russian express complete dismay at the idea of Ukraine as a separate country and the belief that one day it would have to be brought back under Russia’s wing was in 1992. I remember the conversations quite well. This was a guy we’d brought to the UK for courses and so on in London. This guy’s views were sufficiently shocking that I eventually took him along to parliament so they could hear it as well.

It’s not new. Russian disdain for Ukraine is not new — well back in history, certainly into Soviet times.  

Putin didn’t have to make a big deal, and there are a variety of reasons for it — just the idea of Ukraine as a separate state and the particular fear of contagion from popular movements and anti-corruption and democracy campaigners.

He didn’t like the Color Revolutions. [Putin] got into his head that this noxious form of Western decadence would come his way.

There are the issues of NATO enlargement, though they’re overdone. There was something there as well. 

All this formed a mix, probably coming together during COVID when he’s in isolation. As we can see, he’s a complete hypochondriac.

He sits there reading books and deciding that Ukraine isn’t viable and doesn't deserve to exist while it causes Russia so much trouble, and Russian speakers so much trouble. He decides to act. And before, Putin had used military force, but always in a pretty cautious way. He gambled, but gambled cautiously.

That caution went to the wind. Maybe he thought it was an easy win.

It’s going to take a long time before we’re absolutely confident of that. I mean, you know, we’ve got a certain amount of evidence. How much is in the Moscow archives? Who knows?

One suspects it will eventually be very hard to find a Russian who is in favour of this war. This is what happens when somebody dominates the political scene for so long and excludes people who take a different view. 

Coffee with Churchill & Clausewitz

Jordan Schneider: Is there a strategist somewhere in history that you’d really like to hang out with?

Lawrence Freedman: Well, the most realistic would have been to be involved in British decision-making during the Second World War. Churchill, for all his faults, and he wasn’t perfect, was actually open to advice.

He did have civilians — some rather odd, others very bright — that were around, and he was prepared to support them. So, you could probably get a hearing. The strategic debates were really so important and difficult. In the end, the right decision to take. 

To be part of the conversations between the US and British chiefs of staff about second fronts in Italy, were these landings a good idea, would have been absolutely fascinating.

Now, I know quite a bit about these debates and can understand what they would have been about. 

To go further back in time, it would have been interesting to debate these matters with Clausewitz, if we could have understood each other. The fact that the poor chap died before he finished his books means that there are questions that are left lingering. So much time is spent now interpreting what he really meant, it would have been nice to ask him directly what he meant.

There is always, when one studies these things — sometimes you do try and imagine what you would have said and how you would have been involved, as I’ve indicated a couple of times, when very much on the periphery with at least some access to people making decisions.  

When you do that, you realize that strategy is not a very deliberative process, the way in which it often appears.

Much of it is about shifting assumptions. People may not even recognize how much they are shifting, how much it may turn on bits of information or a single conversation that one person had with another that put a thought in their head, how staff work may not be as important as we think it should be, and so on and so forth. 

You get this a bit from historical research, looking back at what we can find out.

There’s always a risk for historians that we make the process appear more methodical, more systematic than it actually is.

Because, you know, there are five factors which were important here, and we can list them all. And maybe they all were very important, and you can find evidence for them.

How they were coming together in somebody’s mind is very different, and what priority, what salience they have was very different. You can identify them, you can judge what you seem to think were the most important. It won’t quite capture the human dimension of the decision. 

Jordan Schneider: The text of a book is something that’s deliberately ordered.

When you’re in an archive and you have 20 pieces of paper all spread out around you, and you’re trying to put it all together, that is actually the headspace that these guys were in.

They have all this different data coming into their heads, and they’re trying to do their best and they’re tired and they’re fighting with their kids or whatever it may be.  

Lawrence Freedman: They’ve got home lives and they’re tired.

Fatigue is an incredibly important fact in decision-making.

I talked to people who’ve been to Kyiv recently. They all remark that the people they’re talking to are very tired. They’ve been doing this for a long time. It’s the same group of people, by and large, and they’re tired. They keep going, adrenaline keeps them going no doubt. It’s mental tiredness as much as it’s physical tiredness. 

Sometimes you read reports about people during the Cuban Missile Crisis and they’re just dog tired because it’s almost as if they can’t sleep in case they miss something. These sorts of things are very hard.  

As you say, there’s the jumble of stuff that’s coming in at you and what captures your attention at a particular moment and what doesn’t. It’s just part of the excitement of the archival research, especially when you see the words directly in front of you that can slowly put together the sequence of events. It’s always hard to quite capture what’s going on in somebody’s head.  

Of course, this is why things like telephone transcripts are so much more revealing which you’ve got very few really, so much more revealing than the official minutes of meetings and so on, because you can get a sense of [audio cut] 

Jordan Schneider: It is a real shame that Watergate happened, because then maybe we’d have a few more decades of presidents deciding it’d be a good idea to record everything they say.

Parts Unknown, Books Unwritten

Jordan Schneider: Are there books you wished existed, or just topics or things you think need better coverage, whether it’s fatigue in decision-making or a particular campaign? Something where you can’t find the book that really scratches your itch? 

Lawrence Freedman: I’m more struck by how many books have been written. The research I did for the Command book, is there anything on that? The tragedy of our profession is how much stuff is written that people forget about. I suddenly found a brilliant article that nobody’s ever actually looked at apart from the author or maybe the editor. 

I have quite a strong view that there’s something exhilarating about primary research in the archives, but we pay far too little attention to secondary material. Somebody’s already been through it. You should respect that.  

It amazes me how much people do find — topics to filter out, even on the Second World War, which you would have thought was done to death, but absolutely not. Interesting books on individual engagements come out all the time.  

What I was trying to do in Command was to say, “Look, we spent a lot of time on the World Wars. Actually, there’s been an awful lot of activity since 1945.” No, it’s not the case that on these topics, there wasn’t anything to read. They’re just not as developed as many as the big themes of the two world wars. As time passes and more archives become available looking at the last 80 years, it will continue to be fruitful.  

For example, there are very well-researched books, say, on Điện Biên Phủ or the French imperial campaigns. You don’t seem to me to have the easy-to-read, accessible big histories that you get on D-Day or something like that.

Leaving aside where scholarly research might be useful, there’s more to be done to bring recent history to light and to life so that people can follow periods which they’re often quite murky. 

In the UK, you’ll see occasional references to Suez in 1956, which at one point would have meant quite a lot to most people, because they remember this rather foolish British-French expedition to topple Nasser after he nationalized the Suez Canal and so on. But it means nothing now to most people in the UK.

Equally, in the US, coming back to your China theme — I’m hoping to write something on this for the Substack. How many people in current policy-making positions are aware of the Sino-Soviet split and the fact that from the ’63 to the ’80s, the Soviet Union and China were as wary of each other as they were of the United States? They think the world started with the end of the Cold War.  

There’s always a job to do. This is how you know it’s a relevant policy question, because if you understand that history, you don’t get so certain about the solidity of any Russian-Chinese alliance now, because there was one before, and it fell apart with acrimony.  

There’s always a lot to be done to remind people of the stream of history of which we’re apart. The future’s always more interesting, maybe. Unless you understand this history, you’re going to get the future wrong.  

Jordan Schneider: What books do that really well? 

Lawrence Freedman: I read so many. There’s a lot being written now on Ukraine. There’s Serhii Plokhy’s book on the Ukraine War. It’s not particularly great on what’s happened since the war broke out, but it tells you an awful lot about where it came and the history of Russian-Ukraine relations. 

There is good stuff on the history of the Vietnam War. Even Ken Burns’s documentary series did that. When you get a big event, people do in the end look back. The problem is when the issue is live, it just keeps on reminding people of the history and going back. But it tells you what’s contingent. It tells you a lot about contingency. 

Again, going back to this questioning of assumptions, things you thought were important were because of particular circumstances rather than laws of nature.

These things don’t have to be. They are because of past decisions — past events that have all left their mark and shaped things.

That’s always an important corrective to firm beliefs about what will and will not happen and what people will and will not respond to in certain situations in the future. 

Back to the Future of War

Jordan Schneider: What was the most enjoyable read for your book about The Future of War? 

Lawrence Freedman: Oh, I certainly enjoyed reading H. G. Wells. Not because he’s a great writer. He isn’t actually, it’s quite a plodding start at time and caricature. It’s just fascinating with somebody who’s writing before the First World War and into the Second World War — particularly before the First World — just to see the assumptions he was making about how wars would unfold. 

There are always just fascinating moments when you suddenly understand — when you get an insight into how he saw the world, because he was just unusual about using fiction as a means of developing his futuristic fantasies, which weren’t always that fantastic. The atomic bomb is called the atomic bomb because of H. G. Wells. I found that’s what’s getting me going. 

I love looking at the earlier stuff, actually. I’m obviously very familiar with more recent writing. It’s more of a revelation to look back at stuff that was a long time ago, especially often because you see very similar themes to the ones that you now recognize being explored in a different time in a different way.  

There’s this famous book called The Battle of Dorking, which was in 1871. It was one of the first of the scare scenarios about how we could be invaded by the Germans. Again, you go through it, and you can pick out what was assumed at the time to be particularly important and that made a difference.

Then you get authors like Joseph Conrad. His book, The Secret Agent, is still one of the most fascinating books about terrorism. He was quite an essayist as well. Great polemicist — very Polish in his attitude to both the Russians and the Germans. 

Again, I just found the reminders of how well people could write and the points that they were trying to make, which were often just forgotten. That’s why I like the history of ideas, why I’ve always enjoyed that.  

Jordan Schneider: That’s the thing with Joseph Conrad and all your strategists — half the reason people still read them is because they were good writers. So much of the other stuff just isn’t, which is just a bummer. 

Lawrence Freedman: The person who was the biggest influence was Michael Howard, my supervisor, mentor, and friend.

The first book, I would say — Not the first book I ever read about the issues that came to bother me, but the first that really [audio cut] was a collection of his essays called Studies in War and Peace, which I’d recommend to any [audio cut] It came out 1970 or so. It’s just full of elegant writing, but a range of topics.  

He’s a brilliant synthesizer. He can catch it in a few sentences, almost a historic leap. That had an enormous influence on me. I read it when I found he was going to be my supervisor, never having dealt with him before. I read it overnight, literally overnight. [audio cut] gripped his mind, because it showed how you could express yourself. I’ve been reading articles on nuclear weapons and nuclear strategy before then, but nothing like this.  

Style & Strategy

Lawrence Freedman: Tom Schelling is someone whose style is different and something quite formal. At his best, he can be a bit playful. You can feel him always trying to think of a way of making the argument, always trying to find a way to get through to his audience, to communicate more effectively. 

There’s an important lesson there for academics and think-tankers alike. If you’ve got something to say, you should be able to say it in a way that’s accessible to other people.

Language should be more than functional. It should draw people in and convince them of your argument or at least give them what they need to argue back at you.

I worry that will be handed over to ChatGPT or some other feature rather than people making the efforts themselves.  

Jordan Schneider: Well, if we live in a world where great researchers who aren’t good stylists can convey themselves more effectively thanks to ChatGPT, I don’t think that’s the worst of all possible worlds. 

If I could take an essay I wrote and be like, “Make this in the style of Joseph Conrad,” I’d pay a lot of money for that. 

Lawrence Freedman: Yeah, I'd be interested to know what happens with that. People do these things in the style of Shakespeare now, so you never know. 

Jordan Schneider: Are there any other writers or stylists that make you say, “Man, this person really knocked the ball out of the park”? 

Lawrence Freedman: John Keegan was also a great stylist. Over time, his books didn’t sustain the same quality, but if you read The Face of Battle, that was another book that was an absolute revelation to read, because it was both an imaginative piece of historical research about battles over far different timescales. 

He asked a really interesting question and came up with some interesting points. What is it that gets men to fight? He was a very elegant stylist. He worked at it. The danger with being too elegant a stylist is that style can take precedence over substance.

It’s always my advice when editing to start with your favorite sentence and take it out, because you probably got so enamored with the words you’d managed to use and the language that you forgot to check whether it was actually making a valid point.  

Style can be overdone at times. I won’t name who fell into that trap. The aim is to communicate. That is about sustaining a reader’s interest. Dense prose, which may be full of important information, develops a significant argument, but which has got your reader nodding off after two pages is not going to do the job.  

Jordan Schneider: I read all Makers of Modern Strategy again because I was interviewing Hal Brands and I got to Hans Delbrück. (He got cut from the latest edition of the book, but he was in the older versions.) He has this crazy life arc. He’s spending most of his life thinking about the Battle of Cannae, and what have you. Then, all of a sudden, World War I starts and he’s the 1915 equivalent of a Substacker. He’s writing columns on the war, and it’s a very surreal thing in a way.  

Lawrence Freedman: I hadn’t realized how it dropped. See, people only knew about Delbrück because of the first Makers of Modern Strategy. He was an accidental inclusion. In Germany, he was well-known. He was important pre-World War I, because he was the most prominent challenger to the assumption of a quick decisive war by defeating the enemy army, and he was the one who warned about wars of attrition. Actually, in some ways, he’s a very modern theorist based on a firm understanding of military history.  

Yes, he did do commentary. Other people did something similar, like Liddell Hart, although less successfully. During the Second World War, Hart was in government for a bit, and as he seemed to get it all wrong, he was not such an effective commentator in the war as he had been in the peace. 

In past wars, you can also see military historians putting their oar in.

You have to be quite careful. Just because you’re good on the history doesn’t mean to say you’d necessarily be a good commentator. 

But Delbrück was a very shrewd guy.

Being Lawrence Freedman

Jordan Schneider: Can we talk a little bit about the Lawrence Freedman production function? How do you pick the next book, the next article? What are your tips and tricks for cutting your favorite sentence? What has kept you going? What’s kept you motivated and curious over the years?  

Lawrence Freedman: When I was younger, you would be tending to write more to demand. If somebody asks you to write something, somebody’s interested in what you have to say so, do it. As I get older, I find that I really only want to work on stuff that really interests me.  

My approach to writing has always been to get into it. I’ve never believed in doing all the research before I start writing. I never know until I start writing what I actually need to know.

It’s an odd process of asking a question and then realizing it might be the wrong question. Different questions suddenly become more interesting. You hit upon a bit of work, a bit of writing that you haven’t thought about before, or some other way somebody else didn’t, or a little bit of archive that you hadn’t come across before. That’s what makes it enthralling and exciting and keeps you going.

If you don’t start writing until you think you know everything, then you’ll never want to write because you’re bored with the topic already. 

Another thing I do, which don’t really recommend, is what I call scavenging. This reflects the fact that when I started in this business, my instincts were that of a historian, and often the archives just weren’t available as I was writing on contemporary stuff. So you had to scavenge newspaper reports, congressional hearings, interviews, memoirs, some good journalistic accounts of stuff, anything that could help a bit.  

It’s being prepared to look at a diverse range of sources. I say not being sniffy about only being in archives, because sometimes the archives aren’t very good or aren’t great when they are. I’ve always been a bit of a scavenger.  

I don’t know, I enjoy writing.

If you don’t enjoy writing, it’s quite hard. I do. It is a creative process. It isn’t about a functional thing — putting down things I’ve learned and conclusions I’ve reached — but it’s about engaging with an audience. Really it’s about engaging with yourself. If I’m bored with something, how could I expect somebody else’s interest? 

How do I choose topics now? Well, in the sense I haven’t — I chose the book on Command, because I’d wanted to write something about command and I wanted to write something about post-1945 military history, so it came together.

Now, I just find I’m immersed in Ukraine. The demands of my Substack are a beast that needs feeding. That keeps me going. Sadly… I’d rather I didn’t feel an urge to write about Ukraine because it wasn’t happening. As it is, it draws me, and having spent a career looking at wars when you have such a big one happening here and now, inevitably, that’s what I feel I should spend my time on.  

US Interventions in the 1990s

Jordan Schneider: If the US had intervened more aggressively in Bosnia earlier on, do you think the example of having the First Gulf War and a successful intervention in Bosnia could have changed something about the 1990s and 2000s?  

Lawrence Freedman: There was Kosovo in the end — which in the circumstance was probably the right call — but it had an unfortunate knock-on effect. Kosovo was more important and Russian attitudes were enlarged. 

We go back to this. I’d have a colleague, James Gale, who before we employed him at King’s came to me and explained to me why there was going to be a war in the former Yugoslavia that he was doing his research on. In March/April 1991, we had a big seminar at King’s when all the Yugoslav experts came along. I was absolutely convinced after that there would be a war, because they were all arguing with each other. 

I remember getting very frustrated in a number of conversations on European security. There was a complacency on this matter. So when it started, I wasn’t surprised, except for the viciousness with which it then developed and the feebleness of the international response, which led to the war spreading to Bosnia.  

To some extent, it was the Kurds in Iraq, also in 1991. One almost created a precedent for the other. There was almost a feeling that you couldn’t just let this stuff pass. Then you had the Clinton administration coming, demanding that more be done for the Bosnians, but was not particularly prepared to do it itself. 

There were enormous difficulties in transatlantic relations — the British and French on one side, the Americans on the other — until eventually by the mid-1990s. Everybody had gotten their positions more or less aligned, and a firmer intervention did take place just as the war was turning against the Serbs — more because of Croatia than Bosnia anyway. 

Would it have been better to have acted earlier? Sure. Would it have sent a good message? Probably. It’s a good example of the problem of how long it can take before a position forms that government will act upon, long and away after it would have been especially useful. 

You can see it in the current situation. The US administration has not been bad at all on this. There’s been this incremental process of saying, “Well, we’ll give you this but not that.” The Ukrainians say, “Well, we need that as well.” “Well, we don’t think you do.” Eventually, the US says, “Well… you do.” It would have been far better if they’d said that right at the start or earlier. 

Again, it comes back to what we’ve been talking about a lot, which is the nature of policy-making and the very human factors thatw influence it. What seems clear to us now is not always clear to those when the decisions are being made.

One of my lines is history is made by people who don’t know what’s going to happen next. We do have the benefit of hindsight.  

Jordan Schneider: You’ve earned the right to write a book without footnotes. Will Durant wrote Fallen Leaves in his 90s, so you’ve got a bit of time. I think a hundred-page book on all your lessons about decision-making, strategy, and warfare would be a real treat… 

Lawrence Freedman: Oddly enough, that’s probably what I’m prone to do, because I’ve been trying to — I’m not sure I can quite face, for the moment anyway, a major piece of hard research, but I’ve been thinking about a little book on strategy, at least rather than another great big, thick tome.

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Lawrence Freedman is the dean of strategic studies. He’s written books about the Falklands War, nuclear strategy, political-military relations, Kennedy’s foreign policy, the revolution of military affairs, and (my personal favorite) the history of strategy.  

Freedman is now part of the father-son substack duo covering war and UK politics.

In part one of this far-reaching conversation, we discuss:

• How the Falklands saved Thatcher’s premiership, making her the Iron Lady.

• Why the great strategic decisions of history rarely have clear, pivotal moments.

• Parallels between Putin, Xi, and the Argentine junta — what the Falklands campaign tells us about Ukraine, Taiwan, and the future of war.

• How nuclear war went from being a “winnable” geopolitical contest to the apocalyptic dog that didn’t bark.

• Cold War arms control treaties and what they can and can’t tell us about AI risks.

Have a listen in your favorite podcast app.

Note: We recorded this episode summer 2023.

Lessons from the Falklands War

Jordan Schneider: Let’s start with the Falklands War. I was reading the official history you wrote about 15 years ago. There were some Taiwan parallels that started to emerge. Am I crazy for seeing some connections there?  

Lawrence Freedman: It’s about the defense of islands and the occupation of islands. The Japanese interestingly have looked to the Falklands for similar reasons. It tells you something about the problems of amphibious operations.

It’s obviously very different in one respect in that there was not a lot of population on the Falklands. There were not the issues of, to a degree anyway, popular resistance or the risk to civilians as a result of fighting. It does tell you about the challenges of maritime operations to take islands. 

Jordan Schneider: What struck me was the buildup to the war.

You had this really weird dynamic of the UK telling the islanders, “You guys, something’s got to give here. The current path is unsustainable. This is too expensive. We’re not really going to be up for this. It’s halfway across the world. It doesn’t really matter all that much to us.”

Then, you had this very confusing multiyear back-and-forth. The Argentine autocracy was facing coups and other internal tumult. All of a sudden, an invasion creeped up on the UK.

Lawrence Freedman: There’s no doubt that in the Foreign Office at least, the preference was to find a way to sort this out, because the wider interests in South America were far greater than those in the Falklands itself. A commitment had been made in the late 1960s to follow the wishes, not the interests, of the islanders. The islanders wished to stay British.  

Everything the Argentinians did reinforced that wish including having coups, economic collapse, and so on. The British got themselves caught in a game whereby they wished to be seen to be negotiating, but they couldn’t negotiate the transfer of sovereignty unless by some mechanism.  

The islanders decided that would be a good idea all by themselves. There was a prohibition on forcing them into it. They hoped that the logic of the situation would dawn upon the islanders, but it never did, because they felt more comfortable with the status quo than with any devices that the Foreign Office came up with such as lease-back.  

Eventually, the procrastination couldn’t hold anymore. Argentine patience ran out. in a way, the British were fortunate, but the Argentinians in the end acted impetuously in April 1982, because if they’d waited a bit, then there would be very little that could be done about it. The full effects of the 1981 defense review hadn’t quite taken hold. As it happened in April 1982, there’d been quite a bit of fleet exercises on Gibraltar, and quite a lot of troops were back for the Easter holidays. 

There were carriers available. The idea was to sell HMS Invincible to Australia, and the HMS Hermes was due to be scrapped. If that were the case, then the UK would not have been able to take air power with the task force. It would have been hopeless.

If the Argentines were a bit more patient, they would’ve been better off. 

Jordan Schneider: This obviously isn’t a direct parallel between US policy towards Taiwan today, but you can see a world in which an isolationist American president starts talking to Taiwanese leadership and saying, “Look, we might not be there for you, and you may have to make some arrangement.” That back and forth conversation is difficult. 

Lawrence Freedman: The difference is, in both cases, the aggressive country — assuming China would be aggressive — was convinced that there was a territorial unity that had to be respected. The difference obviously, with the Taiwanese cases, in principle, the Taiwanese government also agrees that there is some unity. It just doesn’t want it to be overdone. 

The status quo is tenable with Taiwan as long as both sides can live with the fiction that one way or the other, they’re still part of the same country.

As we know, if the Taiwanese government decided to end that fiction — which the Biden administration and all previous American administrations had clung to — then there would be trouble. 

I don’t think there’s a new conversation to be had with the Taiwanese government by a future American administration. It’s really an issue of whether they just stick with the current, say, fictional, artificial situation.

It’s possible, I suppose, that a Trump-like president would be so disinterested in the US international commitments that Beijing would see an opportunity to push them out. That’s a possibility. 

The thing about Taiwan is there’s no necessary dynamic there. It’s not hurtling inexorably to a conflict so long as both sides decide they can stick with the status quo. 

A Very British Intelligence Failure

Jordan Schneider: One of the big things the UK government had to wring their hands about was this being an intelligence failure and then really understanding just how serious it was.

You write about a report that the government put out that

“pointed to a tendency to assume that factors which weighed heavily in the formation of British policies, such as public opinion, a reluctance to use force and military balances of power, would be equally compelling constraints on countries ruled by one party or heavily under the influence of a single leader.”

Lawrence Freedman: It was somewhat ironic. It was just for internal consumption, this report. It warned against all the things that then took place including, which is quite important, just persevering with a particular assessment even when evidence is coming in that suggests you should question it.  

That was part of the problem with the Falklands. The intelligence community had a view that this would be such a foolish thing to do that the Argentinians would do it despite the evidence that maybe they might.

Even when they were doing it, they were reluctant to get off that position.  

Now, we saw this with the Russian invasion of the Ukraine, because it seems such a stupid thing to do, you assume therefore that Putin wouldn’t do it. Of course, he did because he didn’t see the world as we did. Now, we may be more accurate than he was about the foolishness of the thing, but that didn’t help in terms of preventing war. 

Thatcher’s Domestic Pressures

Jordan Schneider: When the Falklands invasion happened, there was enormous domestic political pressure in Britain to do something about it. It almost cost Thatcher her top job.

Even if a Trump-style isolationist convinces himself he doesn’t care about Taiwan, it’s definitely possible that if something does happen — maybe the president isn’t inclined to do it in the first place — the dynamic once an invasion happens could shift so rapidly that a leader could feel compelled to do respond.  

Lawrence Freedman: That’s an important point, because even in this case, the Argentinian junta probably anticipated that this would be the prelude to a negotiation, and thus had no special intention to hold on by force to the island. The British then sent a task force so they couldn’t just back away. Certainly, it was the most popular thing they’d ever done, so they felt they had to stick with it, equally.  

This was territory that was British. The islanders looked and sounded and acted British, they wanted to be British. It’s a bit different from obligations to a client state or to an ally.

It is important to note the prospect of humiliation was a powerful motivating force under Thatcher, if they hadn’t been able to send a task force, Thatcher would have been in great difficulty.

Whether or not she would have fallen is speculative, but she would have been in great difficulty. The fact that she could send a task force made a difference. 

Jordan Schneider: In one passage, the Foreign Office keeps sending people to talk to the islanders and be like, “Come on, guys. Please consider this or that.” All the islanders were always polite to them, so the Foreign Office people convinced themselves that there’s maybe a little more going on there than there otherwise was. 

Lawrence Freedman: I’ve been to the Falklands. I rather like the islanders, and I like the island, despite how bleakly it’s often described. They were dependent upon the UK, and they knew that. Being outright rude was not such a good idea. They were pretty clear in their heads what they wouldn’t accept. 

One of the more successful of the ministers who went out there came from a Welsh mining area. I was very familiar with the phenomenon of places that seemed to be on decline. This was their way of life, and they wanted to stick with it as long as they could rather than uproot themselves because it was politically convenient to somebody else. 

Jordan Schneider: I want to come back to one more thing — Thatcher’s sending the task force to the Falklands being the most popular thing she ever did.

Does that tell you something about human nature?

You mentioned humiliation. Why do people get so excited about this?  

Lawrence Freedman: You’ve got to remember, Thatcher in 1982 was not in a strong position politically. Her government had put the economy through the wringer. It was only just coming out and starting to recover from a recession. She was not particularly popular in her own government in the cabinet.

There was a risk if she wasn’t careful that everything would just turn against her, because she was doing what a patriotic nationalist leader should not do, which is lose territory. In that sense, it was quite a special moment.  

It was more than just the excitement. She could have lost. It’s not hard to work out a scenario where, having sent the task force, Britain still obliged to concede, in the end, the islands to Argentina. Wasn’t inconceivable, because it was a war.  

She was shocked by the event, fearful of the consequences, and not very knowledgeable about military affairs. It was a very quick learning process for, and — having read through her files which she so assiduously worked on — she showed nerve.

At each stage when she might have wobbled a bit, she didn’t. She stuck it through.

That transformed her reputation and kept her going for at least another five years before her decision-making went a awry again. 

On Writing History

Jordan Schneider: You mentioned somewhere that you were covering the Falklands in real time. Then all of a sudden, 25 years later, you have this opportunity to peek under the hood, and see all the secret diplomatic cables, and interview anyone and everyone who is still alive to talk to you about this.  

Even in the introduction to these books you were saying, “Look, I was not able to answer every single question.” Was that your expectation going in? What’s the broader lesson about writing history, having seen that arc through?  

Lawrence Freedman: History is always being interpreted and reinterpreted, because there’s lots of evidence around and you can decide what to pick on and what not to pick on, what questions to ask. Of course, the archival evidence is substantial and good to go through, but it’s by no means complete. In the 1980s, a lot of business was done on the phone. Now, it’s done on emails or WhatsApp. It’s quite hard to get hold of it.  

The information is always incomplete. There are always puzzles as to why somebody did something.

In the end, histories of this sort are about individuals under high stress with big responsibilities — often under the pressure of time — trying to make decisions.

Often, when you talk to them afterwards, they can’t quite remember why they took the decisions they did, or they get the chronology wrong. It all seems a bit of a blur to them later.  

What you can normally get is the basic arguments and the basic concepts and the key decisions. You’re not always going to be quite accurate as to who was in the room, who made what argument.  

There are some issues like still the origins of the First World War. Go back to the origins of the Russian invasion of Ukraine, where you can see there are so many big issues, and questions of alliances, and futures and so on, that it’s going to be hard to be absolutely sure about what was the key variant. By and large, it could historically be to make sense of these events in their broad terms, even if some detail be subject to later interpretation. 

China’s Appetite for War

Jordan Schneider: This is one of the things that really worries me about China. It feels like once a country has a really big, awful war, they’re not super excited to have another big, awful war anytime soon.

China hasn’t fought anything since 1979. When I read Chinese online discourse about it, there is a little echo of 1914 European powers being like, “Oh, man, this would be so fun and awesome and amazing,” when it wouldn’t by any stretch of the imagination.  

Lawrence Freedman:

The Chinese are worried that they haven’t fought a war since 1979. They haven’t got commanders who are hardened and experienced that know what war is like.

You’ve got to hope that one of the consequences of watching the current is that they become aware of the pitfalls of these operations.  

Thatcher didn’t start the war. She was faced with a war that somebody else started and she had to respond. Now, Zelenskyy didn’t start a war. He’s grown in stature, because he’s responded to the war which Putin started. For Xi to start this, he’s not only going to be prepared to take the risk, it may not work out as expected but he’s got to have this as such a priority that he’s prepared to subject the Chinese economy, at least for a while, to potentially serious upheaval.  

The worry about Xi is a legacy idea that he would like to be the leader that sorted out forever the status of Taiwan, just like Putin wanted to be the leader that sorted out forever that Ukraine was very much Russia’s sphere of influence. 

It’s always very hard to get at quite how much this matters to an individual leader in charge of a large country, whether this is something which dominates every waking hour or is something they come back to now and again when they feel maybe it’s time to look at it.

I’m still of the view that Xi would rather not go to war over Taiwan but can imagine circumstances when he might and certainly doesn’t want either the Taiwanese or Washington or anybody else to think he definitely won’t.

That possibility is important to the whole credibility of his position. 

Jordan Schneider: You’re right. Xi, like Putin, has a track record. Xi has basically spent his entire life as a local and provincial official. In those roles, he spent time working on anti-poverty and party-building exercises. Putin has spent the past 15 years invading countries. This is his MO. 

Xi, also, he’s been in power for 10 years now. He’s completely centralized control of the PLA. Having a fisticuffs border fight with India is very different from invading Georgia or having a proxy war in Syria.  

My hope is that when Xi looks at all the different factors at play, he just decides it isn’t worth it. 

What’s really scary to me, coming back to the Falklands, is the post-Xi world where potentially you have this weird PLA junta thing that’s trying to assert itself and assert its legitimacy. Unless Xi really goes senile and goes off-the-rocker, the post-Xi moment is the one that’s really scary to me.

Particularly, 1979 happened partially because Deng wanted to assert his control over the party and tell the PLA, “Look, even though you guys all think this is a bad idea, we should go to Vietnam because I’m just going to show who’s boss.” That is the dynamic which is a little more worrisome than Xi all of a sudden waking up one day and saying, “We’re launching the boats.”

Lawrence Freedman: It’s interesting.

When you look at Russia, one of the problems is that there are no institutions left, essentially. There’s no successor to Putin.

There will obviously be at some point a successor to Putin, but we don’t know who it is or how he, more likely than a she, will be chosen. 

In China, the institutions are still there. The party has its processes and its structures that are still in place. The relationship with the military is quite interesting, because, as you know, a lot of the reforms of the PLA in recent years have been to cut the army down to size and reduce its political influence. He’s quite conscious of that.  

That’s an indication that within the Chinese system, there are forces at work which we may not always understand that well which can produce all the tension.  

Certainly, when you have a leader as dominant as Xi, and if they go, then succession is always going to be a problem.

Someone like Xi is unlikely to want to nominate a successor, because as soon as you do in these systems, they become a threat.

In principle, post-Xi should be easier than post-Putin, because you do have the structures there. The longer Xi is there, the harder it becomes. 

Whither Nuclear Armageddon?

Jordan Schneider: Speaking of communist systems, why wasn’t there a nuclear war? 

Lawrence Freedman: Why wasn’t there as yet? Because it’s scary. There’s a famous idea of the crystal ball effect. If everybody had known in 1914 what the world looked like in 1980, the Kaiser and the Tsar and the emperor of Austria-Hungary and all those who suffered by the end of the war wouldn’t have bothered. But they didn’t know. They had optimistic views about what could happen.  

One of the things nuclear weapons did was to give us a very stark and pessimistic view of the likely outcome, which had the effect from quite early on of increasing the incentives not to go nuclear.

If you look back, even when the Americans had a superiority at the time of Korea, there was always an unease about using such a terrible weapon. That unease carries on to this day. Again, as I hope we can still see in Ukraine. 

Nobody could think of a way to win a nuclear war. We still can’t think of a way to win it.

It wasn’t hard to think about how destructive it could be. Leaders on both sides really didn’t want to test the things that they were prepared to make an effort to avoid that sort of calamity. The longer it has gone on in a sense, the more unthinkable nuclear use seems to be.  

Now, that could change. It could change potentially because of developments in Ukraine or because of something between India and Pakistan or because the North Korean leadership is crazier than we think it is or whatever. You can’t rely on this indefinitely, which is part of the dilemma of living in the nuclear age. 

So far, the way we’ve discussed the issues — which nobody has ever really tried to play it down successfully — is that we have a very clear idea about what nuclear war could entail, and therefore that creates enormous incentives to avoid it. 

Jordan Schneider: What’s fascinating reading nuclear history is just how hard people tried to make it winnable. You had so much engineering strategic energy trying to figure out how to put your bases in the right place. “If we only could have this delivery system, and if we could only harden our shelters this and that way, then maybe we could get an edge..."  

You have these moments in time where Curtis LeMay tells JFK something like, “Screw it. Let’s just bomb them. We’ve had enough of this.” Both on the Soviet as well as the American side, it was the people at the top who were the ones who had to say, “You know what? I’m not going to be the one that’s going to kill 500 million people.” 

Lawrence Freedman: Certainly, during the 1950s and into the 1960s, there was enormous effort put into trying to find a way to win. For somebody like LeMay, you win a nuclear war by getting in first with the maximum carnage and assume that the enemy will just be left unable to respond.

It's not inconceivable in the early 60s that they could have got away with it at appalling cost and an awful lot of fallout.

By the mid-1960s, that had changed. You have since then periods when there are big debates about different sorts of nuclear options. In practice, it’s a long time since anybody has come up with a serious scheme for starting and winning a war. Now, these things can change, but we’ve been in that position for a long time. A lot of effort had to be gone through to prove the proposition wrong before the proposition was eventually accepted.

SALT, a Half-Century Post-Mortem

Jordan Schneider: You recently wrote a “SALT 50 Years On.” Why did nuclear arms reduction treaties even begin in the first place?  

Lawrence Freedman: Well, there are a number of things going on. First, it was useful to have the two sides talking about something. This was an obvious agenda point, because there was a view, particularly late ’50s, early ’60s, of how a situation might develop in which — even though both sides didn’t want a nuclear war — the logic might push them into preemption, misapprehension, or miscalculation. Kennedy was very fixated on that sort of problem.

This became clarified around the issues of first strike and second strike and so on. If both sides had a second-strike capability, the situation was stable. If both sides had a first strike capability, then we’d be on a hair trigger all the time. 

There’s a particular reason for the origins of SALT. It was a desperate effort by the US Secretary of Defense Robert McNamara and the scientists in the arms control community not to go ahead with a large scale anti-ballistic missile system. The Russians didn’t seem so bothered by the idea. [US strategists] got up the idea in their heads that if only you could persuade the Russians not to go ahead as well, then that move enshrined in a treaty would stop an arms race. That was the basic idea.  

Now, I think, when you look at it, which is what I tried to do in that article, actually, there were good reasons for not going ahead with an ABM system, because it would be overwhelmed — because it was much easier to defeat it.

Jordan Schneider: Ash Carter was working for the legendary Office of Technology Assessment (which no longer exists in Congress). He was a physicist, and his evaluation in an infamous report was something like, “This is the dumbest thing I’ve ever heard. It’s never going to work. Talk to me when Moore’s law develops 40 years down the line and then maybe we can come up with something.”

Lawrence Freedman: The Russians just instinctively thought, “Well, how can anybody object to a defensive weapon?” They realized too that it was all pretty pointless, because it could be overwhelmed.

It wasn’t actually the arms race stability arguments that were crucial. What was crucial was the supremacy of the offense over the defense at this time.

For that reason, even without SALT — SALT happened because both sides had come to that conclusion, SALT confirmed it. That was seen as an important breakthrough.

But actually the real breakthrough was strength [assessments] — both sides being aware because of MIRVing and decoys and so on. It just was a balmy idea. Then when you moved on to arms control for offensive systems, no solution was ever really found. Part of the argument in that article you mentioned was that a whole new strategic theory was created about the benefits of perceivable symmetry in which neither side could claim it was stronger than the other.

But it was a wholly contrived thing. And because it was contrived, it sort of elevated the importance of these measures of capability. It led to more arguments than it sought — hence the Committee on the Present Danger in the 1970s — into the Reagan administration.

Actually, one would be hard put soberly to say the strategic arms control actually calmed the situation.

It was a good thing for the two sides to talk. They did learn quite a lot about each other in the process, but I suspect the situation would have stabilized anyway. 

Jordan Schneider: SALT turned into this game of like, “Okay, is one of my bombers worth 75% of one of yours?” At the end of the day, you’re still able to kill everyone else in the other country.

Lawrence Freedman: Serious people expended intellectual effort trying to explain why it mattered, if one side had a superiority in one measure even, if not in all measures, when both could blow each other up. It was just a bad theory, if you like. It elevated things.

Now, as a matter of practical politics, how much would Congress ever have accepted the US just holding back on numbers while the Russians scooted ahead? Probably, there would have been enormous pressure to catch up anyway. At least, you could have talked about it as some rather basic instincts at work rather than try to develop a quasi-sophisticated theory to explain it. 

AI and the History of Arms Control

Jordan Schneider: Folks today are talking about artificial intelligence and arms reduction. They invoke US-Soviet nuclear discussions as a parallel, which I really don’t see, because these folks are worried about the AIs getting out and taking over the planet.  

There are two big differences. First, you have Hiroshima and Nagasaki. Everyone on the planet was convinced nuclear weapons were going to kill you and everyone you love. Second, America and the Soviet Union built thousands of nuclear bombs.

It seems to me completely implausible to get into a world where the US and China decide not to make what some people think is the most powerful thing since sliced bread. 

This is not anthrax. If all it’s only anthrax, then it’s not that big of a deal. If it isn’t, if it’s a nuclear weapon, then there’s no way that nation states are not going to be pursuing it to the maximum extent of its capabilities.  

Lawrence Freedman: The difficulty of conversations about AI is that AI is so many different things.

Basically, there are machine learning and large datasets. The issue is what questions you ask of the AI, and the extent to which it generates imaginative answers.

A lot of the hype either way is overblown. It's important, but the point is that it’s layered — that is, that AI comes on the top of all the other things that are already there. It’s the interaction of AI with the so-called legacy systems that makes a difference.

Decision Points

Jordan Schneider: Is there a particular decision in history you would have loved to be a fly on the wall in the room for? 

Lawrence Freedman: It’d be very frustrating for someone to be a fly on the wall and not being able to say, “Don’t do it.” There’s not a moment of the Cuban Missile Crisis that people beamed through. Of course, in the end, the crisis indicates there are moments of decision, but a lot of it is developing assumptions that you can never quite pin down when the decision was made. Even with the Iraq War, it’s actually quite hard to say this is when the decision was made go to war against Iraq in 2003. It was sort of incremental and there were lots of moments.

The only time I got close to a significant decision in the sense of talking to participants was when Thatcher met Gorbachev for the first time in December 1984. That was interesting, because you could see — I was in a briefing in which somebody in the cabinet office had got mainly genuine Soviet experts, particularly on the Soviet economy, and then me as an arms contractor to talk to her before the visit.  

That was interesting, because the academics, who were very capable people, were able to impress on the weakness of the Soviet economy. You could see her lapping this up and getting quite enthusiastic as the conversation went on about the implications of this and what could be done with it. 

That general policy towards Eastern Europe was one of the better aspects of Thatcher’s foreign policy.

It was informed. It took advice. It was interesting. When the moment came and the Soviet Union and the Soviet bloc started to fall apart, prejudices came back to the fore — not about the Soviet Union, but about Germany — because she couldn’t bear the idea of a united Germany.

What’s interesting to me there was to be at a moment when you could see a prejudice being challenged successfully. Now, as often as not, that just doesn’t happen, because the people surrounding especially well-established leaders tend to be, if not out and out sycophants, at least wary about challenging the leader’s thoughts directly. It would always be interesting to be at a point where it would be a really good thing to challenge ideas. 

I did try to do this in November 2002 with Tony Blair by taking a group of people, experts on Iraq and the Middle East — not to challenge the view that something needs to be done about weapons inspectors and so on, but about what could happen with the war. The timing was all wrong, because it was towards the end of the big UN negotiation about a new resolution for Iraq. 

People weren’t on the edge of their seats at the time expecting a war at any moment. As I recall they were largely worried about or interested in the possibility of a coup against Saddam. The conversation just went off in an odd direction. In comparison with the one with Thatcher — which was very productive but was probably pushing at an open door — this one didn't even begin to push properly because the situation wasn't right.

These are moments that are a glimpse of the way that policymaking is being made, but it demonstrates that it’s only at certain times when you can often penetrate the decision-making process because you have a leader that suddenly doesn't quite know where they are and what the situation is and is open.

If they’re not open, if their ideas are fixed… It would have been great to be part of the conversation with Putin early in 2022, if you got a chance to say, “Do you really understand Ukraine? Do you really think this is on?” etc., because as far as one can tell, nobody did that.  

Jordan Schneider: With LBJ and Vietnam, that’s when the counterfactual falls apart, where you literally have that person embodied who’s saying all the things and is in the position and then the president goes in a different direction. 

Lawrence Freedman: First, Johnson didn’t have a lot of confidence in his own judgments against all these bright people inherited from Kennedy. Second, what he did understand was US domestic politics. He could see only trouble in “losing” Vietnam. Third, as far as one can tell, he was never particularly convinced by the arguments for the bombing or land force, but he couldn’t see a way to avoid them, especially once that was the advice he was being given. 

Whereas, if you look at Kennedy’s decision-making in late 1961 on Vietnam, he was the most dovish member of his own administration, because he had enough confidence in his own judgment to challenge the assumptions people were making.  

Anybody who seeks to offer advice, especially an academic or outside it, has to be sensitive to the overall political context in which an individual is operating and the domestic political factors and so on and so forth, the many different foreign policy issues that may be in play at any given time.

They also need a leader that is confident enough in their own analytical capabilities, in their own judgment to make whole against those advice, but also against their own insights. That’s quite rare.  

Thatcher & Escalation

Jordan Schneider: There was this line in Command where you’re talking about Thatcher’s decision to fight in the Falklands where someone said that if she had been a private in World War II, she would have known how bad this could have gone and would have been less confident  

Kennedy’s World War II service was very real. LBJ’s wasn’t. He was like a sitting congressperson. He flew to Guam or something and then flew back.

It’s interesting thinking about history when you have folks like Ariel Sharon who really had deep military experience in their 20s and 30s. When they ascend to power, they often tend to be the ones that are more hesitant to escalate when there’s the potential to do so.  

Lawrence Freedman: Well, Sharon was not against escalation.  Sharon was an escalator.

Thatcher was very conscious of the fact that she was surrounded by people who’d know more. Two of her small war cabinet got military crosses in the Second World War fighting. The Chief of the Defence Staff, Admiral Lewin, had been on the Malta convoys and so on. They were serious. They knew about warfare, and she didn’t. That made her probably too prepared at times to accept their advice. 

Kennedy, having experienced a pretty traumatic moment in the Pacific, had the junior officer skepticism about senior officers.  

On the other hand, he was following a Supreme Commander as president, and he was very conscious of that. He was very deferential towards Eisenhower, in fact. As time went on, the military advice was being given by people who might have seen combat, but not the world-war type, not big clashes or big army type conflict. Everybody was a little bit in the dark about what it could mean. 

When you’re talking about the United States, you’re talking about a country that could never quite believe that anybody could really beat it. Nobody ever really did.

It lost wars rather than got beaten in wars, because the political conditions worked against it. You’ve got an interesting dynamic at work there. 

With a case like Israel, where they’ve been fighting from day one of their existence, everybody of any seniority has got some military experience. One of Netanyahu’s problems is it was his brother who was the war hero rather than him. Someone like Sharon had been there from the start and forged very sharp views. It’s a small country. They all know each other. They’ve all rubbed up against each other at some point and they formed their friendships and their enmities and got the measure of each other.  

It’s very different in a big, large country, where people don’t know each other quite so well and are not sure of who was going to respond well to the particular pressures of a crisis or whose military judgments are going to be affected by which service they were in and the particular little bit of action they may have seen and so on.  

After the Second World War, well into the ’60s, you had people around who really did. Into the ’80s, there were people around who really did have a good feel for what big war involved.

Over time, that has been lost, and maybe sadly we’re regaining it again as we watch what happens in Ukraine. 

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This past Friday I recorded a show with on SCOTUS’ monumental 6-3 decision. Have a listen here or read the transcript below.

The Ruling: IEEPA Has Zero Tariff Authority

Jordan Schneider: Is the era of tariff by tweet over?

Peter Harrell: I don’t think we’re ever going to persuade President Trump not to threaten tariffs by Truth Social post, but it is very clear in light of today’s Supreme Court opinion that his ability to actually impose those tariffs is going to be constrained. And while he is going to be able to recreate some of his tariffs under other authorities, it’s going to be harder, as he himself acknowledged at his press conference just now.

Jordan: Let’s start with the ruling. What was interesting about it?

Peter: You have a 6-3 majority of the court finding that IEEPA — this 1977 emergency powers statute that Trump has used to impose about two-thirds of his tariffs. This is the statute he used for his universal and reciprocal tariffs, the fentanyl tariffs on Canada and Mexico, and the tariffs he would have used over Greenland. It’s basically everything except the product-specific tariffs on steel or semiconductors — all those are under IEEPA.

The ruling concluded IEEPA does not have any power to tariff. In some ways it’s actually a narrow ruling. As Trump said at his presser, it still gives him the authority to embargo countries like Iran. It also doesn’t constrain his ability to use other tariff laws. It simply says under this statute, which he had relied on for two-thirds or 70 percent of his tariffs — zero tariff authority.

Jordan: What about refunds? What happens next?

Peter: This is the big question. Trump came out fairly ticked at his press conference. He did say that the Supreme Court justices were still, in his words, “barely invited” to come to his State of the Union next Tuesday. So it’ll be interesting to watch that dynamic Tuesday night.

I think about what comes next in two parts. First, he’s going to try to recreate as many of these tariffs as he can under other authorities. He said very clearly he’s going to sign an order under Section 122 of the Trade Act of 1974 to impose a 10 percent tariff starting in three days. So if you’re Japan, South Korea, or the European Union, at least temporarily your tariff rate is coming down — you were at 15, and now you’re going to be at 10.

Then there’s the refund question. If you’re a Walmart or a Costco and you’ve paid $500 million —

Jordan: Or Learning Resources.

Peter: — or Learning Resources, or your small educational toy importer that filed this lawsuit — are you going to get your money back? Trump’s answer today, which I fear is the correct one, is: “We’ll just fight that out in court.” The one true winner of Trump’s trade policy is the trade lawyers. That was true in 2025, and it’s going to be true in 2026. I think at the end of the day, if IEEPA doesn’t authorize these tariffs, these were illegal taxes. Companies that paid will be able to sue to get their money back. That might take a year. Our court system is not known for its rapidity.

As of mid-December, 300,000 American companies had paid IEEPA tariffs. I don’t envy the Department of Justice having to defend 300,000 lawsuits. They might cave in a couple of months and set up some administrative process to make refunds easier. That would be the reasonable thing to do — but they might just decide lawyers are cheap on their side, so sue us.

Jordan: It’s a lot of money — a real deficit-relevant number.

Peter: It’s roughly $140 billion in collected IEEPA tariffs as of December, so it’s probably higher now. It’s a meaningful amount of money.

Global Fallout: Deals, Canada, and Angry Trump Diplomacy

Jordan: Where do we go next? Japan and Europe.

Peter: Looking around the world — Trump has something like 20 trade deals he’s announced. I think we’re up to seven that actually have full text. We got Indonesia just a couple of days ago and Taiwan a week or two ago. Then you have maybe another dozen or so that are four-page MOUs or term sheets.

So if you’re Japan, Argentina, or Europe, do you walk away from your deal? Do you decide the tariffs are going away and just bail? I think the answer is probably no, for a few reasons.

Trump will be able to recreate some of these tariffs, as he’s already doing with his 10 percent tariff. And if you’re Europe, what you got out of this deal was really three things. One, you got a cap on your IEEPA tariff rate. Two, you got caps on the Section 232 tariffs for some products, which matter a lot. The 30 percent of tariffs that aren’t IEEPA are things like the steel, aluminum, and car tariffs. For Europe, one key thing in the deal was getting the 232 tariff reduced from 25 percent to 15 percent. For Germany, that matters a lot — you don’t want to blow that up by walking away.

And finally, no one wants to piss off angry Donald Trump, who will threaten to embargo you, withdraw military protection, or maybe invade some of your territory. So I think they probably don’t walk away from these deals — even though Trump has now lost his magic tariff Sharpie.

Jordan: What about Canada?

Peter: This is where Trump is going to find this most painful. He can still go on Truth Social and post whatever he wants — it’s a free country when it comes to speech. He can say he’s mad at Carney and wants 100 percent tariffs until Canada gives us Alberta. But it’s going to be a lot harder to actually implement those. He could do a Section 301 investigation and probably impose a 15 percent tariff on Canada, but you can’t impose unlimited tariffs under 301, and you have to do an investigation. For his hobby horses — disliking Canada, some European countries — it’s just going to be hard for him.

Jordan: On the 301s — can you have Claude Code do your investigation for you? Who can sue saying your investigation was BS?

Peter: They have some options. Section 122 lets him impose up to 15 percent. He said today he was choosing 10 percent for 150 days. So they have until about mid-July to figure out something to keep the tariffs going.

For 301, you have to do a factual investigation, find that a foreign country engages in an unfair practice, have some quantification of the harm, and then have a process for deciding retaliatory tariffs. USTR is going to have to decide the right balance: do we produce 301s that are more likely to hold up in court because we put more work into them — but maybe in 150 days you can only do 20 of those? Or do we have Claude Code write 170 of them within five months and take our chances?

Jordan: Who can sue?

Peter: The lawsuits going forward get murkier and are going to be even more lucrative for the trade lawyers. With IEEPA, the argument was simple: IEEPA doesn’t authorize any tariffs, so all of them should go. But 301 clearly authorizes tariffs. So if you’re importing from France, you’d have to sue and argue the France 301 was done badly — and even if you win, that has no bearing on whether the Vietnam 301 was done badly. It’s going to be country-by-country litigation.

Will Trump Take the Tariff Off-Ramp?

Jordan: What a mess. I guess the question is — there’s a narrative that this is actually a blessing in disguise for Trump. This is an off-ramp. They realize inflation is bad and now he gets to roll things back.

Peter: I’d be curious what you think. There’d be a lot of logic to that view — this would be a nice opportunity to politically rethink. But Donald Trump is tariff man! He’s just going to tariff.

Jordan: I guess the question is to what extent there are other people in the administration who want to reimpose something like what we have now. I could see him seeing this as an L, getting distracted, and moving on to other things — start new wars or pick different fights on Twitter. Liberation Day was very much a him-driven thing.

Now that we have more of a process and we have these deals, do we still need giant tariffs hanging over everyone’s head that aren’t that credible? We’re going to do all these Section 301s, and then the fun part is the deals. The tariffs are a means to an end, and if we’re already getting deals, can you just threaten the 301 tariffs? Does that still give you the leverage you need?

I could see it both ways.

Peter: We’ll see. What he’ll lose if he doesn’t recreate the tariffs is the revenue. It was $140 billion between March and December of last year just on the IEEPA tariffs. If he does nothing to recreate them, he’d probably lose $200–250 billion in revenue, which is something on the order of 5 to 10 percent of federal receipts. It’s not zero.

Jordan: What about the ruling itself? There were some zingers. Kind of a fun read.

Peter: The interesting quirk is that some of the lines are drawn from the government’s briefs. When the DOJ was submitting briefs, they made frankly somewhat outlandish claims about the tariffs’ economic impact — that it matters whether we’ll be a rich or a poor nation. But the Justice Department never framed it as “we the attorneys believe this.” They consistently framed it as “our boss believes this.” They never wanted to own Trump’s Trumpian claims.

Jordan: There was also the line: “No, no, a thousand times no, but should have sufficed to dissuade the principal dissent from invoking this case.”

Peter: On a more serious note, you see a very sharp debate among the justices about the major questions doctrine. The majority — Roberts, Barrett, and Gorsuch — said that for a big government action relying on an old statute, Congress has to speak clearly to authorize that kind of action. They’ve been developing this doctrine over the last decade or so.

The liberal justices — Kagan wrote the opinion, joined by Sotomayor and Jackson — have been skeptical of the major questions doctrine from the beginning. They reached the same outcome, no IEEPA tariffs, but without adopting the doctrine. And the dissenting conservatives — Kavanaugh, Alito, and Thomas — all believe in the major questions doctrine. They had to come up with convoluted reasons why the doctrine should overturn Obama-era clean air regulations but not this.

You also see Justice Jackson in her individual concurrence trying to bring legislative history back. The conservative majority doesn’t really believe in legislative history — they don’t want to read what congressmen said during the legislative process.

Jordan: Why not? I thought that was their whole thing.

Peter: They believe in originalism, but they think you should view it in the context of what the words meant at the time they were adopted — objectively rather than subjectively. They’ll look at a dictionary definition from when IEEPA was passed in 1977, but they won’t go into what the authors of IEEPA said.

Jordan: So originalism isn’t just 1789 — it can also be the early 1970s. You’re citing dictionaries from the era as “this is how the words were used back in the day.”

Peter: Exactly. And the worry about legislative history — going back to the congressional record to see what Congressman X said — is that it can be manipulated. Congress doesn’t fully agree on what a statute means. If you just believe what one person said about it, that’s not necessarily what everybody who voted for it meant.

Live from Toy Fair: Why Toys Are Still Made in China

Jordan: I went to the Toy Fair, the largest toy industry convention in the world, earlier this week.

Peter: Because they’re all still Chinese, right? We still buy most of the toys from China?

Jordan: Absolutely. What was fun was talking to people about why they can’t make them anywhere else. It’s just like lots of other electronics assembly. Magnets were one thing folks said was really hard — the entire magnet industry is in China. If you’re bringing magnets somewhere else, then you’re paying transit costs and they’re going to hit you. There’s also a high safety bar with magnets because if kids eat two of them, they clamp together and can blow up your intestine or something.

I talked to one factory that was making toys for adults — giant Hogwarts replicas made out of wood that only adults can assemble. It’s very skilled work, and the pain of setting up that expertise in another country is enormous. You can’t have toys fail because there’s this big safety dimension.

Peter: Fair point. I think of a lot of toys as fairly cheap and cheaply made, but there really is a lot of safety engineering to make sure they don’t leak chemicals and things like that.

Jordan: People were saying there are still parts of the manufacturing process that need humans — sometimes they paint on the glue, sometimes the decals. Are you okay with one in a thousand being screwed up? One in 10,000? If you have a less experienced workforce, you’re going to struggle.

The other thing folks talked about was the SKU challenges. Everyone was saying this was the most boring Toy Fair of the year because there’s far less innovation. Everyone’s playing it safe because they’re worried about keeping their businesses going. They’re not coming up with the cool new toy — they’re just making another animal set or pizza set.

So I walked up to the Learning Resources booth. Small business, fourth-generation family owned. I said, “Hey, can I talk to whoever was involved in the tariff case?” Some guy says, “Yeah, Rick’s over here.” I walk up, and he was super game, really friendly. It gave me real Profiles in Courage vibes. The fact that it took a small business — not Mattel, Hasbro, or any of the thousands of other companies that paid these tariffs — to step up is really a testament to American democracy. Some random small business owner can embarrass a president like this.

Peter: I very much agree. When I first started talking about tariff litigation last year, most big companies were completely intimidated by Trump. Trade associations were lying low and hoping it blows over. It was really only the small businesses — Learning Resources plus a couple of small businesses in New York, and some Democratic state governments. That’s who was willing to sue because everyone else was terrified of Donald Trump.

It’s a huge testament to the fact our system can and does work — small businesses can have this kind of victory. I also hope it sends a broader message: if the government does something illegal, you’ve got to stand up to it. It’s really not in your interest to cower on the sidelines.

Jordan: A few days ago I purchased for the Schneider household the Spike the Fine Motor Hedgehog as well as Peekaboo Learning Farm — to give my thanks in monetary form to Learning Resources for putting this together.

The other funny thing — Learning Resources is very wholesome. Happy educational toys. Their big new product this year is a children’s yoga ball, maybe a foot in diameter, wrapped in a fuzzy cover with a bear version and tiger version. Rick was telling me about it: “We’re really proud of this. It helps kids learn to calm themselves down and be more mindful.”

And as you’re walking in, right next to the yoga ball, there’s “Fart Time” — a statue of some animal maybe four feet in the air with a giant purple fart coming out under it. I’ll make this the thumbnail so none of you miss it. It was a fascinating contrast in this giant convention center — from the happy educational “we just want your kids to learn and develop” to the “we’re going to sell your kids poops and farts and you’re going to thank us for it.”

One dark thing someone told me — the influencers in this world are really young, like 10 and under. The way you get press now is you pay for posts. And there’s very much a child actor dynamic where you’re not becoming an influencer at six unless your parent is pushing you.

Peter: Europe’s on the move — a couple of countries are moving toward no social media for under 16. So maybe eventually.

Jordan: Or maybe you can only make posts if they’re about happy educational toys, not poop and fart ones. Actually, that sounds like Woke AI. All right, let’s call it here. Peter, thanks for jumping on today. Everyone tell Peter to start his freaking Substack already so I can get off LinkedIn and stop reading his posts. It’s always a pleasure.

Peter: Thanks, Jordan. Always a pleasure.

We’re here for a CHIPS Act megapod, in person with Mike Schmidt and Todd Fisher, the director and founding CIO of the CHIPS Program Office, respectively.

We discuss…

• The mechanisms behind the success of the CHIPS Act,

• What CHIPS can teach us about other industrial policy challenges, like APIs and rare earths,

• What it takes to build a successful industrial policy implementation team,

• How the fear of “another Solyndra” is holding back US industrial policy,

• Chris Miller’s recent interest in revitalizing America’s chemical industry.

Listen now on your favorite podcast app.

This post is a collaboration with the Factory Settings Substack. Subscribe for more insights from former CHIPS Program Office leaders!

Factory Settings

How to update the default settings of government, by former CHIPS Program Office leadership.

Was the Fab Boom Inevitable?

Jordan Schneider: We’re about a year out now. There was a long arc of Congress and two administrations imagining what the CHIPS Act could be, and now we’re sitting here in the first quarter of 2026 with fabs popping up everywhere — the biggest semiconductor buildout in memory. Everyone in the world wants more chips and more manufacturing capacity, and a decent percentage of that is now coming online in the US. That wasn’t necessarily baked in. Looking back, how do you give credit to the incentives versus the macro trends that would have led to some version of this buildout regardless?

Todd Fisher: It was definitely not baked in. If you go back to when the CHIPS Act passed in August 2022, ChatGPT hadn’t even launched until November of that year. The concept that AI would drive this massive demand cycle was not part of the original calculus — that became clearer as the years went on. At the time, we were projecting a trillion-dollar semiconductor industry perhaps by 2030. Now, that trillion-dollar milestone is going to be hit this year. The demand cycle was not anticipated.

What we did accomplish is acceleration. It’s hard to shift an entire business from outside the US into the US along with all of its supply chains. That takes time, effort, talent development, and construction. The building that’s happened — what we incentivized — has enabled a more rapid participation across the industry.

Mike Schmidt: A massive buildout of fab capacity to meet the moment on AI around the world was inevitable once the AI boom really took off. CHIPS was ultimately about where those fabs would get built and whether we could get a good chunk of them here. The CHIPS Act played a huge role in that.

A few factors stand out. The investment tax credit was enormously important — a 25% cost offset on investment that provided a strong baseline subsidy. Our office managed $39 billion in grants, and we mobilized around that. That worked together with some natural advantages we have as a country: a strong economy, a strong workforce, and — really importantly — the major customers of semiconductors are American companies. When companies look around the world, it makes sense to be close to their customers. A confluence of factors — some market-driven, some about public policy, some about execution — all conspired to put us in the position we’re in.

Jordan Schneider: Taking a step back from CHIPS, when you think about the playbook you ran to promote domestic manufacturing or shape the market, what’s the holistic framework? What aspects of CHIPS worked for and against you as you were trying to put government money behind an industrial aim?

Todd Fisher: Everything’s a trade-off. If you’re going to put — adding the ITC and our subsidies — $100 billion into the semiconductor industry, that’s $100 billion you’re not putting somewhere else. You have to frame it that way: we can’t do everything, so we have to be focused.

I laid out this approach in one of our Substack posts on Factory Settings. Something has to be critical — critical for national defense, for people’s health, for enabling technologies of the future. It also has to be compromised in a way that’s going to cause us pain. We’re seeing that right now with the weaponization of economic tools around rare earths, semiconductors, and other specific choke points that are genuinely negative from a national and economic security perspective. And you have to determine that your effort — your subsidization, your tax incentives — can actually make a difference. That gets to the nature and structure of the industry, the supply-demand dynamics, and the cost factors, and whether a subsidy over some period of time can shift the fundamental economics.

Those conditions won’t be true across the board for all industries, so you need to evaluate all of them when designing industrial policy.

For chips, it’s clearly critical — they’re an enabling technology for just about everything happening right now. You can look at the newspaper articles every day about memory shortages and the need for TSMC to make more chips. That is going to be the ultimate chokehold on AI. It’s clearly compromised, because up until a couple of years ago, we had zero percent of leading-edge logic or memory being produced in this country. Now, for the first time in over a decade, we do. And in our view, it’s changeable, because the semiconductor industry is not labor-intensive — it’s highly automated. The cost differentials are much more focused on front-end construction than back-end operations. If you can correct the cost differentials on the front end, there’s a path to sustainability over time. Those are the aspects that made sense for leading-edge semiconductors specifically, and that framework can be applied elsewhere.

Mike Schmidt: The big analytical project of the moment is figuring out which industries have a similarly strong and compelling national security case for intervention. Once you decide intervention is necessary, our experience with CHIPS suggests pretty strongly that you have to study that industry closely to understand the tools and approaches that will work — whether that means onshoring, working with allies and partners, or otherwise creating a more resilient supply chain.

Jordan Schneider: Let’s talk about the sequencing. We have this bill, and in it there’s a little bit for advanced packaging, some money for R&D, but it’s basically telling the executive branch, “Figure it out. We think this is important and we came to a number. You go from there.” That seems like the wrong sequencing to me — I don’t know.

Mike Schmidt: You need a mix of purpose, direction, and discretion. There were two sides of CHIPS — $11 billion for R&D and $39 billion for manufacturing incentives. Our part was the $39 billion for manufacturing.

Jordan Schneider: Right, we don’t talk about that other $11 billion.

Mike Schmidt: For us, it was basically a blank slate. There was one $2 billion carve-out for fairly mature technologies, but we wanted to spend more than $2 billion on that anyway, so it wasn’t a binding constraint — it was a floor rather than a ceiling. That put us in a position of asking, “What do we want to achieve with these funds, and what do we think we can achieve?”

Early on in program implementation, when you’re just building a team and racing against the clock to get your funding announcement out the door so you can take in applications, there’s a baked-in narrative that things are moving too slowly. It took a fair amount of discipline for us to say in those early days that we needed to invest the time and resources to really articulate a vision.

We ended up doing that through a document we called our Vision for Success — Dan Kim was on a couple of weeks ago and talked about it as well. That was our stake in the ground. We had a lot of discretion, and we wanted to hold ourselves accountable. We did a whole bunch of work to figure out what our objectives would be, and that document ended up being a really important disciplining mechanism — not just externally but internally — because it created the framework by which we would measure our own success.

Todd Fisher: You said you’re not sure it was the right sequencing. I actually think it was. Identifying the big issue that could potentially move the needle for the country — semiconductors broadly — and then enabling the people who would actually execute and implement the program to dig in with the right expertise and think through different approaches: that’s the right way to do it.

If you legislate something with too much detail, you’re going to miss the nuances of execution and implementation that are so important. The effort we put into the Vision for Success, the way we thought through program design and incentives, the kinds of companies we wanted to approach, who we wanted to draw in, how we set up the whole process — we were quite lucky to have the flexibility to design it from the ground up.

Mike Schmidt: That said, you can go too far in the direction of discretion. For us, we knew it was chips. You could imagine a world in which, given all of these vulnerabilities and choke points, you take a huge pot of money and just give it to the executive branch with the instruction to advance economic and national security. There are benefits to that — you can imagine a robust, flexible executive making dynamic decisions, addressing problems as they emerge, and moving quickly.

But with CHIPS, we had a huge benefit from the fact that we had a bipartisan law with a clear overarching objective, and we could then define the specifics within that. It allowed us to build a team centered on that objective, develop deep expertise in the industry we were focused on, and build internal know-how. In the broader political context, it also gave us a clear measuring stick that we’d be held against.

Jordan Schneider: The backdrop of what I was getting at is that the origins and legislation around the CHIPS Act were this random confluence of an intellectual effort plus COVID, and it happened to be the right moment with enough momentum behind it. If you ran 2018 through 2022 thirty times, the CHIPS Act probably happens maybe two or three times. But the question is, what if you had $85 billion to do American economic security broadly? Would we be more economically secure today if that had been the mandate, as opposed to directing all the money specifically toward chips?

Mike Schmidt: Personally, there’s a lot of value in Congress identifying key target areas and then telling the executive branch it has broad discretion to figure out the how. You can spin a lot of wheels trying to identify targets from scratch.

Jordan Schneider: The IRA is a counterexample, right?

Mike Schmidt: The IRA, unlike CHIPS, isn’t one pot of money or a single tax credit doing one thing. It’s an assortment of different tax credits and programs, each with a different objective. A challenge with the IRA is that some of those objectives are targeted at different things, and how they all work together into a coherent strategy is tougher than when you have one specific goal and a few tools to mobilize toward it.

Todd Fisher: But why do you say the IRA is a counterexample?

Jordan Schneider: Maybe it’s not. The real counterexample is that no one would ever get $100 billion to do economic security in the abstract. The happy medium — where the executive branch has enough trust from Congress to actually do things that don’t get earmarked away into, I wouldn’t say oblivion, but not the strategic version of the thing — probably requires Congress signing off on a particular industry.

Todd Fisher: I probably haven’t thought enough about this, but the CHIPS Act for an industry that’s going to be a trillion-dollar market was very appropriate. Take rare earths and critical minerals today. It’s hard to just wait for Congress to figure out this is an issue and pass legislation. There’s some combination needed. The right answer isn’t “here’s $100 billion, figure out what to do with it.” It’s more like: chips are important, we’re going to do something very focused there, and here’s $10 billion to address things that are going to become critical.

Consider the rare earth industry. These are 17 different elements, and the overall market is about $5 to $6 billion. You can solve the rare earth issue because it’s a $5 to $6 billion problem. You can’t solve a trillion-dollar industry the same way. There’s a different mindset required. You could look at APIs, pharmaceuticals — there are different choke points across the system that we need to be more nimble about addressing. Then there are the big things that take massive amounts of time, effort, and money.

Jordan Schneider: The takeaway is that there are two buckets — giant industries where the amount of money needed requires direct congressional appropriation, and then a second category where it would be nice to have an office that looks at these issues with a smaller pot of money and the ability to issue debt or whatever other tools — things that are an order of magnitude smaller where we don’t have to stress as much.

Mike Schmidt: That’s a good idea. I like it.

Jordan Schneider: I stole it from you.

Mike Schmidt: There’s also a question of what kind of state capacity you need to develop. For something like pharmaceutical APIs, it might make sense to have a dedicated program because it’s such a specialized market requiring deep technical expertise. Whereas something like critical minerals might be more straightforward in terms of what you’re trying to achieve and how the industry is structured.

Jordan Schneider: When it comes to this idea of discretion and Congress trusting you, we’re in a different world today. I remember you being very focused on transparency — wanting to make the process fair and making sure everyone felt they were getting a fair shake. Now we’re living in a world where relatives of presidents and cabinet members sit on boards of companies receiving government money.

It feels almost quaint in retrospect how focused you were on that. But my worry with the smaller, more nimble and discretionary efforts is that we’re going to enter a backlash to the current moment where there just won’t be any appetite or trust for this kind of thing.

Todd Fisher: That all comes down to governance and how you set things up — specifically, the ability to insulate the process from politics and preferences that intervene in unconstructive ways. The good news about CHIPS is that it was set up in a way that our team felt pretty protected from politics. That was partly structural, partly how Gina Raimondo approached it, and partly about personnel. Neither of us were political appointees. Many of the people I hired on my team were Republicans. It depends on how you set these things up — whether it’s purely transactional wheeling and dealing, which is one approach, or whether you build something more institutional. You could set something up along the lines of the DFC, where it’s insulated and more trustworthy, with built-in transparency. You’re right that there might be a backlash, but I would caution against retreating from this, because we’ll miss something really important if we do.

Jordan Schneider: Could you do the short version of that, Mike?

Mike Schmidt: On balance, I would urge simple tax credits and other straightforward tools as the default. There’s probably an additional bar you have to clear before deciding when the discretionary approach makes sense, because the potential for politicization and abuse is real.

For us, the semiconductor industry was such a distinctive case. The scale was dramatic, the industry was highly concentrated, and creating a hub in the government that engaged dynamically with the industry to form partnerships, scale up investment, and make specific commitments we felt were important for national security — all of that proved really valuable.

There are other circumstances where discretion can be helpful. On rare earths, discretion right now is probably useful just because it’s such an emergency that it doesn’t make sense to throw a tax credit out there and see what happens. But that’s partly because our own policies created the emergency. A longer-term, more stable industrial strategy would identify a set of priorities, establish a baseline of market-based incentives and tax credits, and then layer in discretion for the key areas where it really makes sense.

Todd Fisher: I broadly agree, but the challenge is that tax credits only go so far — they’re really just one tool. When you start thinking about rare earths, some of the things the Trump administration has done are very credible, particularly on the demand side of the equation, providing price floors and a certain amount of guaranteed demand.

We didn’t have that. One thing we really lacked in the CHIPS Act was any kind of demand incentive. We were forced to rely entirely on the bully pulpit — engaging with Apple, Nvidia, AMD, Broadcom, and others, telling them this was in their interest and that they needed to be helping us so we could help them drive supply development. Aggressive supply expansion only happens with real demand signals. Those exist today, but they didn’t four years ago.

I prefer the tax credit any day, but it’s a very evenly spread incentive, and you miss a lot. You miss a number of tools, and you miss the ability — which we really took to another level — to push companies to do more. With a tax credit, companies are going to do what they’re going to do. With our discretionary money, we were able to say: no, we need you to build another fab. We need you to bring this technology here. We need you to shift your inventory levels. That allowed us to be much more proactive about our priorities — like drawing advanced packaging facilities to the US, which wasn’t on the table for the first year or so.

Mike Schmidt: The other thing, from an institutional standpoint: Treasury’s Office of Tax Policy is a fantastic institution within the government. I worked very closely with them in my role before CHIPS. But they’re never going to be the hub of energy in government to make an industry succeed — that’s not their role. They write regulations to make sure congressional objectives are being met, that credits aren’t ripe for abuse, that there aren’t loopholes. That’s not what we did. What we did was build a group of people — 180 at its peak — who woke up every day and thought: how can we make the semiconductor industry successful in the United States, and what tools do we have at our disposal to do that?

Jordan Schneider: There’s so much to pick up on. I’m very thankful that your child was two years old and not a 25-year-old hotshot semiconductor hedge fund member.

The institutional question is a really interesting one, though. You alluded to the DFC. The Fed is another example — though I guess we’re politicizing that one too now. But the idea that you could have some chunk of the government whose job it is to prevent China from having economic leverage over the US, or to do everything possible to minimize that — with a dedicated pot of money and tools over a sustained period — seems like a bipartisan thing.

Mike Schmidt: There’s a lot to disentangle in that. Having some chunk of the government that focuses on this is really important. Even the Trump administration ended up taking on the CHIPS office and putting it inside what they called the United States Investment Accelerator. There is this notion that what we built could be the foundation for something more durable — not just about semiconductors, but broader. A permanent institution that pulls people from the private sector and public sector to focus on this set of problems, one that develops methodologies, rigor, and expertise around it, would be hugely valuable.

Jordan Schneider: We have the U.S. Digital Service with these little rotational programs for software engineers. Why not industry analysts?

Mike Schmidt: It seems like a natural fit. And it doesn’t have to be rotational — it could just be that they’re in charge of allocating whatever pool of money exists. There are two downstream questions worth pulling apart, though. One is how much discretion this office has over what industries receive funding. Does Congress set the objectives and identify the priority industries, then hand it off to the office? Or does the office have more discretion? The second question is about independence from political interference and finding the right balance. We created systems and structures within our operation to keep politics out of it to the extent we could, but that wasn’t legislated. It was about establishing processes and norms. There’s a whole set of questions around how to formalize that.

Todd Fisher: I go back and forth on this. The special nature of what we had was the ability to attract the talent we attracted. Most of those people have now left — not only because the administration shifted, but because most of them weren’t necessarily partisan people.

Jordan Schneider: They couldn’t do math fast enough?

Todd Fisher: No, but obviously they should have had better talent. Come on.

They came from the private sector and wanted to go back to the private sector. The rotational aspect you mentioned would be great. But the thing that makes me nervous about setting up a separate institution — and on balance, I do think it would be beneficial — is how you sustain a pipeline of really talented private-sector people. Not only financial and investment types, but semiconductor and industry experts. How do you bring them in dynamically, in a way where people want to be there and feel that the experience furthers their career rather than setting them back?

There aren’t many examples in government that pull this off. The Fed is a good one, but it’s very difficult to set up another Fed. That’s going to be really hard. Then you say, well, maybe the right answer is that when you have something big, you just do it again and figure it out. I’d love for there to be a centralized function, but I have doubts about whether it would be excellent or merely good.

Mike Schmidt: The counter to that — and my sense is that, yes, a lot of people we worked with left, but they’re hiring people now, and many of them are pretty good. The counter is that this set of issues is going to be at the forefront of national security and competition with China for the foreseeable future. That naturally draws people. People came to us not just because they thought we were awesome or because they loved Gina Raimondo — though that was part of it. A big part of it was simply that people want to serve. That piece will continue.

Having served around ten years in government, there’s this enduring mystery — why do certain agencies thrive and maintain an awesome culture over time, while others just atrophy?

Todd Fisher: The other thing is the fragmentation. One of the things that would be great to fix is how many different entities are involved. Even for us, we had to deal with Treasury on the tax side, and even within Commerce, export controls were separate. Then when you start talking about demand and scale, you’ve got the DOD, the Department of Energy — and even at the White House level, how do you create something that integrates all of this?

Some countries have models worth studying. Japan, for instance, has a structure more focused purely on economic security that combines all these functions and breaks down those barriers. It would be really valuable to have some of those barriers eliminated and bring together cross-functional disciplines.

Jordan Schneider: There are two pieces of this. One is mapping out the Chinese economic escalation ladder — the universe of disruptions that could devastate the American economy. Map all of that out. Develop playbooks with dollar amounts, GDP estimates, and labor projections for every contingency we could face over the next five to ten years. Then you can present the executive branch or Congress with a well-thought-out menu: here are the problems, here’s what it would cost to fix them, here are the five tools available. And this analysis is independent — not coming from the chemicals industry, a rare earth miner, or a semiconductor manufacturing firm, but from something that’s working on behalf of the American people.

The question is whether that analytical work alone is exciting enough to attract the best and the brightest, or whether you also need the ability to say, “We’re solving this, and we have real money to deploy.”

Mike Schmidt: You need the money side for the best and brightest.

Todd Fisher: One hundred percent.

Mike Schmidt: The analytical side already exists to some degree — ITA at Commerce has a lot of that capability and a lot of great people.

Jordan Schneider: But they had two people on it.

Mike Schmidt: Right. You could definitely imagine a more robust version of that. But to truly attract a broad range of people who want to make a difference, you need more than just analysis.

Jordan Schneider: People actually want to do something.

Mike Schmidt: Exactly. Telling someone, “Come up with a plan that Congress may or may not enact” — in an era when Congress doesn’t seem to do very much — it’s hard to see that being enough. One of the most humbling experiences of doing CHIPS was the commitment to the mission. People would come in and just work their asses off. They stayed longer than they planned. They really wanted to get the job done and felt it was important. A lot of people stayed well into the Trump administration because they were focused on what mattered. That’s always awesome — truly cool to see. But people show up when there’s really something to do.

Jordan Schneider: Right, but that’s the argument for having a small sovereign wealth fund-type entity where you can pitch to an investment committee or something.

Todd Fisher: You have to have capital.

Mike Schmidt: If money is there but the question is how it’s going to be deployed, that’s a big job — a very different thing. You need the money to build state capacity. It falls to those of us outside of government to figure out the right framework for Congress to act on in a bipartisan way.

Todd Fisher: Don’t call it a sovereign wealth fund. A sovereign wealth fund, in my mind, takes surpluses that a country has and invests them to enhance returns for the government. This is more of an investment entity — I don’t know what the right term would be — where you’re actually trying to influence industries in a more targeted way.

The concept is great. What I struggle with most — and Mike as well — is that what we did over those two and a half years is hard to look back on and say, “That’s repeatable.” It’s not easy to replicate. You can’t just hand someone a playbook and say, “Go execute.” It feels like a one-off. And I believe strongly that for us as a country to be successful long-term, it can’t be a one-off — it has to be repeatable. I want to really believe we can create a separate entity that attracts the best and the brightest so we can do it again. That’s something I struggle with a lot.

Jordan Schneider: This is why I want to come back to the corruption piece. Part of what made this a one-off was that the team was above reproach. The pressures you faced were none of the really ugly ones we’ve seen throughout American history when the government spends lots of money. What worries me is that what we’ve seen over the past year — and will continue to see over the next three years — is going to poison the well for this kind of work. Work that all of us agree needs to happen. People just won’t trust it.

Mike Schmidt: There are many respects in which what’s happening in the world right now is going to make this kind of work harder going forward, and that’s certainly one of them. If you begin to question the integrity of these efforts, it makes it harder to sustain the political will — or you end up choosing different tools, like tax credits. That’s a big piece of it.

But there are others. The whole discussion about allies — we spoke throughout the Biden administration about the importance of working in concert with allies and partners. There’s a moment right now, in the wake of Carney’s speech and this broader reckoning with what’s happening with our traditional allies and partners, where thinking through new frameworks to create durable strategic economic connectivity is really important. There’s probably a longer list than that, but it’s a critical issue to raise.

Jordan Schneider: It’s frustrating to watch the critical minerals work, because clearly there are really good people doing really smart things — that’s ninety percent of it. Then you get a story or two and you think, “What the hell?” Stopping a negative outcome isn’t going to resonate with the American people. Having a critical minerals reserve isn’t going to get headlines or clicks. What gets attention is someone controversial ending up on a board.

Mike Schmidt: But there’s a more hopeful flip side. The folks doing this work now, in the trenches figuring out which tools to apply to which situations, running into the same state capacity constraints — or maybe blowing through them in ways we didn’t — over time, they could develop into a group of capable technocrats who inform this work constructively going forward.

Todd Fisher: I’m actually more positive on the critical minerals and rare earths front. There are multiple things happening. Getting stuff done in government is hard, for all the reasons we just discussed. But being able to break through logjams, push things forward, and deploy multiple tools — that’s what’s happening in the rare earths space. Multiple efforts are underway, multiple tools are being employed across the board. I may not agree with all of them, but broadly speaking, deploying those tools aggressively, building a strategic reserve, and bringing countries together to think through the issue collectively — those things fit together. You’re right that one negative can erase all that good work.

But hopefully this is a sample of what you might be able to do with a smaller industry, because it’s a solvable problem. It takes time, but it’s totally solvable in dollar terms — even if we had to subsidize it forever, given the scale involved. That would not be true of many other areas where there are real choke points.

Jordan Schneider: Let’s talk about doing things that lawyers get upset about. Mike, how hemmed in did you feel? If you knew then what you know now about how far an administration could push things without major blowback, what would you have done differently?

Mike Schmidt: We tried to do as good a job as we could thinking about risk holistically, and that’s true at multiple levels. With individual deals — Intel is a risky deal, but there’s a lot of risk in not doing a deal with Intel, given the critical role they play in the broader ecosystem. But it’s also true when it comes to questions of process.

One of the things I used to always tell the team as we were thinking through how to get something done: the biggest risk of this whole thing is that we don’t get it done. We’re going to run out of clock, we won’t have gotten our deals across the finish line, and the country will be worse off for it. We needed to think flexibly and dynamically about all of this. We did a pretty good job of that, but looking back, there are areas where it’s really worth asking: could we have been more willing to take risks? Could we have prioritized efficiency over some of the risk avoidance?

Todd Fisher: Where would you have taken more risk?

Mike Schmidt: We have a new Substack where we’re talking about some of this. We discussed how hard it was to get our deals done. For listeners, we would reach term sheets with our applicants laying out the basic economic terms — how much money, over what milestones, and so on. Then we had to turn those term sheets into final award documentation, which meant diving into a bunch of nitty-gritty legal details.

Each individual issue involved a real trade-off, and you could understand why the government cared about it. If the government gets sued because of something the company did, should the government be protected? If the company tries to sell a project or sell itself, should the government have the ability to reassess the deal? If the company breaks the law, violates export controls, violates sanctions — all of these provisions accumulate to create a huge amount of friction in getting deals done.

We thought about each one rigorously and made a lot of trade-offs along the way. It’s not as though we weren’t trying to be flexible. But when you talk about sustainability, I look at that and say I would definitely advise a team going in to do this again to put all of that on a list and just decide up front: we don’t care about all of these. Cut twenty-five or fifty percent of them. That means accepting more structural risk in the deals, but it makes the whole process much more manageable and dollar-efficient.

Todd Fisher: I agree with that. What keeps coming to mind for me is the demand side of the equation — how we could have pushed Nvidia, AMD, Apple, Broadcom, Qualcomm, and others harder to help accelerate things and set up an environment that moved faster, particularly with some of TSMC’s competitors. Whether we could have done more, I’m not sure, because we didn’t have the actual tools. It was mostly the bully pulpit.

Jordan Schneider: Was there ever a thought to go back to Congress on that side?

Todd Fisher: I don’t recall. Getting new appropriations for demand incentives — particularly giving money to some of the largest trillion-dollar companies in the world — is a difficult ask. We structured some things where we agreed to pay for porting costs to incentivize companies to dual-source or shift some of their work from TSMC to Intel or elsewhere. But it was all cajoling. Could we have pushed harder? I don’t know. We didn’t have the tools, so it was just persuasion.

This administration is bringing every tool to bear in a very transactional way — “if you don’t do this, I won’t do that.” That wouldn’t have been an approach we’d have been comfortable with. But between where we were and where things are now, there’s probably quite a bit of space in between.

Jordan Schneider: Instead of asking for daycare, threatening to get CEOs fired would have been an interesting approach.

Mike Schmidt: It is a question of norms — how you interact and interface with industry. It would have been tempting. I remember at one point we had a conversation about a company we were dealing with that we knew had something going on with BIS. You could cross those two things pretty easily and make it much simpler to extract the investment you were looking for. But there was just this sense — I believe it was Leslie, our general counsel, who said, “We don’t do that.” And the rest of us were sitting there thinking, “That seems right.” Because once you start going down the path of the government exercising its power in one area to get what it wants in another...

Jordan Schneider: Then you get donations for the East Wing. That’s how it all comes together, right?

Mike Schmidt: Right. That felt like a line. But at the same time, maybe we were a little too precious about it. That’s an interesting question in terms of finding the right balance, because at the end of the day, you’re trying to get these companies to do things that are important for national security.

Todd Fisher: That’s the one area where people might push back. You could say we should have tried to get TSMC to build more fabs, but to me that’s a total red herring. On TSMC, our major effort was to get them to build three fabs. Why three? Because of the way they construct their fabs, once you build the third, it’s almost guaranteed they’re going to build a fourth. Once you have four fabs, you’re going to build six because you want that mega-fab scale. Our view was that we didn’t want to spend the extra money to get another fab up front. If we could get them to three, the rest would take care of itself.

The fact that they’re now saying they’re doing more — because demand projections moved from a trillion dollars in 2030 to a trillion dollars in 2026 — doesn’t really mean anything to me. It’s not as though I anticipated that acceleration. The other question you could ask is whether we could have pushed these companies harder to do more. We pushed them really hard, and we got them to do a lot. There’s the public stuff — the big numbers and the specific fabs. Then there are things in the background that people don’t focus on or don’t even know about: moving certain technologies here, agreeing to provisions in their deals around supply chain, upstream, and downstream that will strengthen the ecosystem very significantly. I feel very good about that.

Jordan Schneider: If we’re going to use TSMC as an example, there is a world in which a president, instead of being happy with a $500 billion number on a piece of paper, says, “If these fabs aren’t built by this date, you’re not getting this.”

Todd Fisher: That, and more.

Mike Schmidt: We did have that — with our money. That was the milestones. But it was within the bounds of the program, as opposed to saying, “If they’re not built by this date, then some licenses get compromised” or other levers outside the program.

Jordan Schneider: It comes back to the independence-versus-leverage question. You say you were pushing them pretty hard. You were mentioning World War II industrial policy analogies earlier. If a war was starting, or if you had ninety percent confidence it was going to start in two years and you needed TSMC to move half of its company to America in six months, there are levers the U.S. government could pull that are very different from tax incentives.

Mike Schmidt: True. Although, from my amateur historian reading on how World War II played out, it was a full mobilization with a huge buildup of state capacity. But the tools were pretty straightforward — the power of the government as a customer and as a financier on the supply side. In the meantime, there was massive political mobilization on the industry side — to win the political narrative coming out of the war and lay the foundation for the type of post-war economic system that the business community wanted.

You don’t read that history and get the sense of executives who were afraid the government would use leverage in one area to compromise their interests in another. You get the sense of the government having its interests, industry having its interests, and ultimately both sides working incredibly collaboratively to get it done — but with a huge amount of friction, tension, and politicking along the way.

Jordan Schneider: What I’m getting at is the dynamic with allied countries that are small, that can be pressured, where the U.S. has an enormous amount of leverage. You were talking earlier about not coloring outside the lines — not crossing streams with colleagues at BIS, not stretching the boundaries of executive branch authority. One of the lessons of the Trump administration over the past year is that the executive branch is incredibly powerful, and the amount of leverage America has over other countries is remarkable.

Maybe it’s better to keep that Pandora’s box closed, because opening it leads to the really dark outcomes we’re seeing now. But I can’t help feeling that however much success the CHIPS Act has had, the current administration is striking the fear of God into these companies in a way that nice subsidies never did. A different dynamic could have been unlocked.

Mike Schmidt: It’s a worthwhile discussion — the intersection of diplomatic and industrial activities and how those two things interact. Our experience was that we had our own lanes with industry. These companies are massive power centers. If you look at the major Korean or Taiwanese chip companies, within their own countries they are not the government — they have their own interests and their own geopolitical positioning.

But in the backdrop of all that, the strategic relationships between countries were always present. For us, those were mostly separate threads, but they were generally swimming in the same direction. As we were doing our Samsung deal, Biden was holding his summit at Camp David with Korea and Japan, creating new strategic dynamics in Asia that were pulling allies closer. We always felt our work fit into that, and I’m sure the Koreans felt the same. We had our lane — dealing with Samsung and SK hynix to secure the investments we needed — and it was part of a bigger picture.

Jordan Schneider: Maybe it’s a question of the difference between looming crisis trend lines we don’t like, versus having six months to actually prepare for something that the president says is important.

Mike Schmidt: But as a political question, the real challenge is — how do you create a sense of crisis before it happens, so that you’re actually prepared?

Defensive vs. Offensive Industrial Policy

Jordan Schneider: You said on another show, Todd, that you did ten times the deals KKR would do in a year in about eighteen months. What do you lose at that pace? What do you gain? What are the trade-offs?

Todd Fisher: You lose sleep, honestly. When you’re doing deals at KKR, you’re out hustling to find the right opportunities. Here, the deals were coming to us, so it’s not a perfect comparison. The more relevant parallel is that once you have an agreed deal, getting it to a final, documented, sign-on-the-bottom-line agreement is hard. Mike just talked about that. It’s also true in the commercial world, but there the boundaries are already set. KKR has done hundreds of deals in its history and has hundreds of agreements with companies. There’s only so much room to go back and forth. That was a real challenge for us — trying to get multiple deals done in a very short period of time.

But it also creates excitement, team dynamic, and a culture of, “We’re just going to do this and get it done.” That’s very energizing. Having everything on the table at once, with everybody working and trying to get it all across the line — that was very positive.

Mike Schmidt: There’s also a question underneath your question. We often talk about process as something that gets in the way of the objective. But to what extent does process, even if it takes more time, actually end up serving the objective?

One thing we’ve hashed over in retrospect — and a little bit at the time, but mostly afterward — is this wonky structural detail. Our CHIPS money functioned mostly as grants. It’s basically free money that companies keep to help offset cost disadvantages relative to Asia so they invest here. But legally, it wasn’t grants — it was under something called Other Transaction Authority. That meant we had much more flexibility than we would have had in a grant context to design the program as we saw fit.

One thing we could have done is come out of the gates and start doing deals immediately. Instead, we put out a Notice of Funding Opportunity (NOFO), created structured evaluation criteria, built an application process with timelines, and built the team around that. That meant we weren’t immediately going to Intel and TSMC saying, “All right, what’s the deal going to be?”

We also used that time to build our team and develop capacity. But there’s no question: the decision to create that structured process cost us time. At the same time, it had a lot of benefits. It put us on footing with industry where companies knew how we were thinking. They knew our objectives from our vision for success. It grounded negotiations in a sense of fairness and rigor, and ultimately built mutual credibility and respect. It certainly provided some political protection — we laid out a process and followed through on exactly what we said we’d do.

All of that is good, but it takes more time. There are people on the team who would think I’m crazy — they’d say we should have just been out there doing deals faster. I get it. But our sense is that it was probably good to bake in some process to slow our roll a bit so we didn’t rush out and do something we’d regret later.

Todd Fisher: That’s right. I believe strongly in that. If your goal is just to get a deal done with TSMC and Intel, then just go get a deal done with TSMC and Intel. But our goal was broader than that.

Advanced packaging is a perfect example. If we hadn’t laid out a process, really gone after that space, and recognized the critical issues in advanced packaging, we wouldn’t have gotten Amkor to invest here. SK would have been a question mark. Those deals are going to be critical to the future.

We haven’t talked about this, and we’re not as knowledgeable on the R&D side. But one of the things on my mind is that right now, as a country, we’re focused on what I’d call defensive choke points — “Oh my God, there’s an issue in critical minerals, we’ve got to address it,” or “We have zero percent bleeding-edge semiconductor manufacturing here.” The next one will be batteries, or drones, or APIs, or whatever it might be.

But what we should also be focused on are the enabling technologies of the future. Advanced packaging is one of them. The industry is changing dramatically. TSMC broadly owns it now, but it’s evolving, and the U.S. can become the major hub for what is essentially the next generation of Moore’s Law. The same is true across many different materials, substrates, and areas where we should be investing more on the R&D front in a more offensive way.

A lot of what we’ve talked about today is how to use industrial policy to plug choke points. But it’s also about how to use industrial policy to think about what will enable the future. Is it going to be humanoid robots? That full supply chain basically doesn’t exist today but could potentially be created in the U.S. and become a fundamental competitive advantage over time. But we’d have to focus on it and figure out what it’s going to take to get there.

Jordan Schneider: The offensive versus defensive split is interesting. On the defensive side, I feel confident that if you set up a Fed-like institution, give them $50 billion, they’ll 80/20 their way there — these are manageable, tangible problems. The money can be directed to solve specific issues, and the technology already exists. But the offensive stuff is different. There are pieces America has that we’d presumably want to keep — global dollarization, TSMC and Intel and Samsung being ahead of where SMIC is. But beyond that, I’m really not sure I trust the government to pick what the next industry is going to be. The answer is probably more that the NSF and NIH need to do their jobs well. It’s a much more amorphous challenge of how to get R&D right.

Mike Schmidt: It is more amorphous and definitely extends beyond our direct experience. But when you start thinking about the offensive side, you also need to expand beyond what you might traditionally think of as industrial policy — or expand your concept of what industrial policy is. Because it’s about technological leadership, dollar dominance, our university system, allies and partners. It’s a broader geopolitical game where we have pretty significant vulnerabilities that have emerged vis-à-vis China. They’re going to continue investing, continue looking for ways to create more vulnerabilities or shore up their own.

Todd Fisher: We have to do the same. Those vulnerabilities emerged because China took a more offensive approach. The fact that they identified the electric vehicle supply chain as critical — particularly the enabling technology for EVs like batteries, which are also essential for drones, robotics, and more — that positioned them well. What I’m saying is there’s a role for government to incentivize and encourage some of this activity. Obviously there’s a lot of venture capital. We have so many great advantages in this country — deep financial markets, deep venture capital, innovation, phenomenal design capability. But the government has a role to play in complementing all of that.

Mike Schmidt: We are just so far behind on the manufacturing side that when I think about manufacturing activity, I immediately go on the defensive. Maybe in that context, there are some areas where we can carve out our own sources of leverage. That’s why my head ends up going toward these other dimensions — it’s not just about manufacturing. But I agree with what you’re saying.

Jordan Schneider: This is maybe the fundamental question of the 21st century — can you R&D your way out of needing manufacturing scale? That’s very much an open question.

Todd Fisher: Why can’t you R&D your way out of manufacturing scale? The whole AI revolution is going to disrupt so many industries, including manufacturing, and we should be — and are — trying to take advantage of that. We have a lot of the skill set to do it.

Take printed circuit boards as an example. We couldn’t fund them through the CHIPS Act because they’re not semiconductors. But if you look downstream from the chip, every chip has to land on a printed circuit board. At least sixty percent of those boards are manufactured in China. As AI has gotten deeper and more compelling, the complexity of those boards — the multi-layered nature of them — has become more important, and they could become a choke point in data centers.

The challenge is that right now, it’s almost impossible to figure out how to meet those costs competitively in the U.S., even with reasonable subsidies. But can you redesign the manufacturing process? Can you not only automate but really rethink it? Are there other tools? That kind of innovation can take a very significant amount of cost out. If we’re able to figure some of those things out, we can be much more competitive in manufacturing at scale.

Risk Aversion and the Solyndra Mentality

Jordan Schneider: I get pitches in my inbox all the time from startups trying to solve the rare earth problem with some new manufacturing technology so we don’t have to dig the next hole in the ground.

Mike Schmidt: Sounds like you have an interesting inbox. I take it they want to come on the show?

Jordan Schneider: They want Congress to notice them. It’s great. But the question is, if you’re sitting in your American Resiliency Fund, how much money are you spending on these breakthrough technologies versus the mine in Montana? You’d have to make an expected value calculation. What would history tell us? We don’t need guano anymore.

Maybe if demand gets tight enough, sufficient scientists, money, and energy will converge to solve these problems. But the issue is there isn’t money for this stuff because it’s so cheap.

Mike Schmidt: A couple of things on that. One is creating incentives or structures on the demand side so that demand isn’t just being driven to China — so it’s naturally being pushed toward, if not the United States alone, a broader ecosystem of countries outside of China.

In terms of what we do, if we’re going to pursue this on a broader scale — and it’s foundational to our competition with China — we have to get comfortable with the notion that not every bet is going to pay off. That’s true at the company level, and it could also be true at the industry level. Rare earths are a crisis now. We should do those deals. But should we also be doing deals that make those deals look bad in retrospect? Yes! We should be pursuing bets that leapfrog whatever the current technology is.

That’s okay. It’s okay to have some bets pay off and others not, as long as overall we are orienting ourselves strategically to deal with a really significant challenge to our power.

Todd Fisher: That’s not an easy mindset and culture to shift. The whole Solyndra mentality — I don’t know how many times we heard that term. It was constant.

“We can’t have another Solyndra” became code for being really risk-averse. But government money exists precisely because the private market can’t fill that gap, which means you’re inherently taking on more risk than private markets would. Some things are going to fail, and we need to figure out how to build a government culture and oversight approach that’s comfortable with that.

I want to ban the word “Solyndra from government.” It drives risk aversion and prevents people from taking smart bets. The same Loan Programs Office that funded Solyndra also funded Tesla. On an overall basis, that fund did fine — and if you had included some upside sharing or equity, it would have done phenomenally.

Jordan Schneider: I’m just trying to think — would I rather have had Tesla go bust?

I wanted to come back to the CHIPS Act dealmaking side. You mentioned AI tooling. This seems like something that’s very hard to automate. What percentage of the work do you think could have been automated?

Mike Schmidt: Very little. Just to give a sense of scale — I’ve been reading books about World War II, and you’ll come across a passage like, “There was this big challenge, so they spun up a bureaucracy of 25,000 people to solve it.” Our team was 180 people managing $39 billion. A pretty lean organization.

Once you get the deals done, there’s a whole post-award phase — the monitoring piece. We only had maybe a couple of months of post-award experience after getting deals closed and cash out the door. But that ongoing monitoring feels like an area where there might be some opportunity for automation. Maybe in due diligence as well.

Jordan Schneider: There’s a whole universe of investment banking work where the percentage of the junior banker’s job that AI can handle is growing over time. But the bigger point is that it feels like there’s something fundamentally human about the way you set things up — where you actually need to deeply understand the individuals on the other side of the table representing the companies.

Todd Fisher: Ultimately — and maybe this is what’s being compromised right now — it’s about building trust between the private sector and government. What companies were nervous about was: “We trust you, but we don’t know who’s going to be in your seat in a year, let alone five or ten years.” If we’re going to do industrial policy well, the private sector and the public sector need to trust each other in the way Mike described from World War II — people collaborating in trusting relationships while still being competitive and pursuing their own interests. We created that dynamic, and you can’t build it on anything other than a human level.

Mike Schmidt: There’s no replacement for that. Although I will say, I made some really bad slide decks that would probably look great now with AI. Should I pull these out? I was just a big text-on-the-page guy.

Todd Fisher: Well, Mike was better at it than I was.

Jordan Schneider: My wife refuses to download Claude for Excel. I was trying to sell her on it — “Don’t you want to just try it out?” Her argument was, “If I don’t build the model myself, I don’t know what the numbers are.” Working backward doesn’t force you to do the thinking — to actually put the assumptions in your brain down on paper.

Mike Schmidt: That’s a fair point. Todd, when we got our jobs, the first few months — in addition to putting together the vision for success, thinking through how the process would go, designing the application, all the work on the NOFO, building the team — we did a lot of engagement. We probably had 15 different calls with people in the finance industry: bankers, private equity folks, equity analysts, just asking about the industry. The cool thing about these jobs is everyone will talk to you.

Then came our early engagements with the companies and the customers. It was a crash course — just absorbing as much as you possibly can. There’s no way to replicate that through reading alone. At least for me, it’s about hearing things over time and then developing little intuitions about what’s going to work, what’s not going to work, and what’s important.

Todd Fisher: And developing those relationships. I would go to investor conferences and do one-on-ones — 15 investors in the course of a day — just hearing their views on the industry and what they thought was going to happen, while giving them a sense of how we were approaching things. There was a long-term benefit to that.

It was really beneficial to us at CHIPS. There were many times we brought a group of investors to DC, sat around a table with Gina Raimondo, and discussed what they were seeing China do. A lot of these hedge funds have eyes on the ground in China, trying to figure out who’s doing what, how many EUV machines are actually there. You can learn a lot.

Mike Schmidt: If a company is giving you a lot of happy talk, Todd being at a conference provided a useful check. We’d talk that night and he’d say, “There’s a lot of skepticism here about Company X being able to do that thing.” That might be right or wrong, but it’s a helpful data point.

Todd Fisher: Same with the customers. Once they realized we were credible people genuinely trying to do the right thing, the relationship changed. If you look at the Venn diagram of our interests versus theirs, it was almost a complete overlap — they needed more supply. We ended up with really collaborative discussions that gave us a lot of information and knowledge, allowed us to understand what was going on, and empowered us to push harder: “Why don’t you try this? Why don’t you try that?”

That’s what a separate national investment bank — or whatever you want to call it — could offer. The advantage of building those relationships and having that credibility would be really valuable. That’s something most people don’t focus on when they think about the kind of work we ended up doing.

Mike Schmidt: But I’d guess that folks at the Department of Energy working on rare earths have developed exactly that. They probably know the ecosystem well, know the targets. I bet they’re doing it all.

Jordan Schneider: An interesting contrast is that you two did not come at this with deep sector experience — you hadn’t worked in the chips industry for 30 years. You added people to the team who did have that background, but the leadership came from elsewhere. On the R&D side, it was different — there were leaders who had spent 25 or 30 years living and swimming in this world. Without speaking about them specifically, what were the advantages and disadvantages of coming at this without having spent 20 years at Intel or investing in chip stocks?

Mike Schmidt: The disadvantages were very clear. We had to learn a lot in a very short period of time and develop credibility. I had a very explicit conversation with Secretary Raimondo about this when she offered me the job, because I wanted to be fully transparent with her — I did not have a background in some of the domains that seemed relevant for the role.

What she said was, “For this role, I want someone who knows how to get something done in government. That is its own craft.” She said I’d figure out what I needed to figure out, and we would build the team. To build that team, you needed a whole bunch of things — commercial financial expertise on one hand, and industry expertise on the other. That ended up being the project.

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Really importantly, building the team was a department-wide, administration-wide effort. Todd came in as Chief Investment Officer. Donna Dubinsky, a very successful Silicon Valley entrepreneur, had been recruiting people for months at the Commerce Department and handed us a list saying, “I think you should hire these people.” Many of them did end up on the team.

In the early days, we had monthly meetings in the West Wing with Brian Deese and Jake Sullivan. The first topic on the agenda was always the team. If there was a target we were trying to recruit, we would lean on them for help — “Hey Jake, can you take your phone right now and text this person? Don’t put it away until you do.” And they would.

Raimondo — one of her many talents is attracting talent. To her tremendous credit, she was obsessed with getting good people in, and once you identified someone, she was obsessed with closing them. There was never a time where I said, “Secretary, I need you to take 15 minutes with this person to help me close the deal,” and she didn’t do it. All of that came together to build a pretty awesome group of people with the expertise we needed.

Jordan Schneider: From your perspective, the upside was that you can’t be a semiconductor expert and know how to get things done in government?

Mike Schmidt: You could be, but that person didn’t exist. Maybe they did and maybe they would have done a better job.

Todd Fisher: Whether you have semiconductor experience isn’t really the point. As we discussed earlier, the deck is stacked against you. The way government is currently set up, the deck is stacked against you when it comes to getting big things done in a compressed period of time — particularly when you’re starting from scratch and have two, two and a half years to build a team, build a process, build a system, get money committed, and start getting it out the door. That’s a Herculean task even outside of government. Inside government, the odds are even worse.

Part of what Competing with Giants is all about is how to unstack that deck so these things become easier to do in government. The critical thing from a leadership perspective isn’t just knowing how to get things done in government — though that’s part of it — but having a maniacal focus on project management, prioritization, pushing things forward, breaking down barriers, operations, and process. That’s the thing. If you also happen to be a semiconductor expert, great — but you can find the semiconductor expertise separately.

I’m never going to be a pure semiconductor expert, but we learned enough to have credibility. That’s the lesson from my career in private equity. Over the years, I did retail deals, chemical deals, financial services deals. You learn what makes a good investment, what questions to ask, and how to be a curious person — who do I need to find the answer from, how do I network, who do I bring onto the team or contract as consultants to answer the questions I know I need answered but am never going to be smart enough to figure out on my own?

Mike Schmidt: That’s the trick of investing. On the question of expertise, a couple of things. My successor, a woman named Lynelle McKay, came from the industry with 25 years of executive experience. She stayed for close to nine months after I left, serving as director of the program in the Trump administration. She had that industry background plus a couple of years of government experience working on our team. She did unbelievable work and then led the team. There are different profiles that can work — but in that startup phase, having government execution capability was probably really important.

The other thing I’d say is the semiconductor expertise we needed didn’t just come from the industry. Perhaps one of our most valued experts on specific technologies came from the intelligence community — deep, specific knowledge of how different technologies would be used in different national security contexts. On every deal we did, we’d go to him to understand why a particular technology mattered.

Todd Fisher: We also had an investor on the team who had been doing semiconductor investment — he’d never been in semiconductor fab manufacturing or engineering, but he had a completely different network of people. That breadth of networks across different parts of the economy gave us a lot of advantages.

On America’s Chemical Industry

Jordan Schneider: Let’s take a chemicals detour first. Chris Miller was texting me the other day: “Chemicals is an industry no one in the policy world understands. China’s crushing it, and it’s probably on the cusp of major transformation and R&D driven by AI. The traditional petrochemicals are being crushed by China. BASF is losing production. Korean players are non-existent. But America is starting to be more viable due to low natural gas prices.”

Todd Fisher: He’s talking about a very specific part of the chemical industry. Petrochemicals in East Asia involve massive capacity. But when you think about chemicals for the semiconductor industry — which is all upstream — that’s not solely, but significantly, about very small specialty chemicals like photoresist esters, for example. That’s a whole different way to think about it.

Mike Schmidt: Very, very different. We struggled a little with those because they didn’t get the investment tax credit. To the extent we could incentivize them directly, those were mostly smaller deals that didn’t get done while we were there and are still sitting on the table. The hope was that by creating enough of a demand signal through operations at the major fabs, the suppliers would want to co-locate over time.

Jordan Schneider: Todd, when we talk about doing industrial policy in giant, sophisticated industries versus the small, struggling ones — when you think about the people you had across the table at Intel, TSMC, and Micron, these are high-flying industries with very strong competitive dynamics. The execution risk profile is completely different from a mine that hasn’t existed for a while and may not even be viable. From an investment perspective — something you’re always thinking about in private equity — how did that factor into the CHIPS Act work, and how would it need to factor into the long tail of industrial policy challenges?

Todd Fisher: It factored in very significantly. Maybe the first conversation — certainly one of the very early conversations I had with Secretary Raimondo — was: “We’ve got the world’s most sophisticated people across the table from us. They have unlimited resources and can hire the most sophisticated advisors and lawyers. We need to face off against them in a highly credible way.”

That shaped how we hired. It shaped team structure — something Mike and I talked a lot about up front. There are many different ways you can structure a team, and we ultimately chose to organize it more like a typical investment firm. Small, dedicated teams facing off against each company — one team deeply getting to know Intel, another for TSMC, another for Samsung, and so on.

It also shaped the kinds of advisors we brought in — a whole other topic in government, and a crazy process. But I was very focused on making sure we had an advisor by our side, so that if a company was going to bring Goldman Sachs to tell us why we were wrong, we had someone of that caliber on our side.

A lot of the upfront design work connects to what we discussed earlier about whether legislation should give flexibility or hem you in. That flexibility allowed us to step back and say: given this industry, this set of applicants and customers, what do we need? How do we structure the team, hire the right people, and create a process that ensures our independence?

It also drove some specific design choices. I’ve written about some of these, but our upside-sharing mechanisms — a form of equity — were designed not only to protect taxpayers and capture value if companies did far better than expected, but also to align information asymmetries. We wanted to ensure there was no incentive for companies to tell us the numbers were either too high or too low — there was an incentive to give us the real numbers. We tried to structure the overall program to limit information asymmetries and to be able to sit across the table from these highly sophisticated companies as sophisticated counterparts ourselves.

Jordan Schneider: Thinking about the small-cap companies — one of the big tools private equity firms have is that when they take something over, they can bring in new management. As we start doing more of these equity deals, is there a universe where we really need a company to succeed but don’t trust the person running it, even though they’re the only one with the capital? We don’t have to do the Intel analogy right now, but what happens when you need a firm to do something and the leadership you don’t think can get you there?

Mike Schmidt: There’s a question of legal authority. Does your deal give you the authority to change management? Most of these deals would not. But then there are informal mechanisms — obviously, tweets can do things. What I would say is it should be a very, very high bar. Extremely high. I wouldn’t say never, but the government should have a very high degree of humility about whether it knows enough to decide who is best to manage a company. The strategic interest may never be high enough where you’d feel compelled to do it and confident enough in how to execute it. There are precedents — the auto bailout, where they changed management — but that’s the rare exception.

Todd Fisher: It’s the absolute exception. With CHIPS, we were on average giving these companies 10% of the cost of a project. There’s a whole separate topic of whether you should own direct equity in these companies versus some form of warrant or upside sharing that’s more taxpayer-protective, as opposed to picking winners and losers, actually owning shares, or having voting rights. You get into a very slippery slope, because I don’t think government should be in the business of business in that way.

Government should be trying to figure out what the market is failing to provide — whatever externality or other reason the private sector isn’t willing to fill — and then use government funds and tools to incentivize and shape the market.

We had so many debates about TSMC, Intel, and Samsung. Obviously, TSMC is by far the market leader today. You could argue: put all the money into TSMC because they’re going to get us there. Or you could argue: don’t give any money to TSMC because they’re a Taiwanese company — we should be supporting our own. Our conclusion was that we need TSMC to be successful. They have the know-how. They can help us build an ecosystem. But it’s not a healthy market if only one player can really serve it. We should be encouraging the other two — because there are only two, Samsung and Intel — giving them every possibility of succeeding, and then letting the market sort itself out. That’s a much healthier environment where you’re creating the ground rules and the set of incentives, enabling these companies to compete effectively, and letting the market function.

Jordan Schneider: Let’s talk about the emotional relationship to all this, now a year out. Do you drive past the TSMC fab with pride?

Todd Fisher: When you think about the transformational potential, it is mind-bending. If you go to Phoenix and see the pieces of the puzzle coming into place — TSMC, Intel, Amkor, the supply chain, ASU, the local and county governments, the innovation ecosystem developing around it — you can look ten years out and say this could be the equivalent of Hsinchu. That’s incredible.

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When you think about what could happen in upstate New York — Micron just broke ground a few weeks ago — the scale that comes with memory and the ongoing investment could totally transform the region. It’s going to take a decade or more, but it’s pretty exciting to think about planting those seeds. Same in Taylor, Texas. These are potentially really transformational investments.

Mike Schmidt: We felt a huge amount of pride. We got our deals done, we were catalyzing investment, and it really was on a good trajectory. But at no point in the process — until maybe a month before the end — did that seem self-evident. It was a grind. The release of saying, “We’ve done our part and we can pass the baton,” felt really, really good.

Then there was definitely a period of uncertainty about this organization and program I’d spent two and a half years obsessing over every day. For a few months, signals about the program’s future would come through — a statement in a speech, different indicators — and I didn’t have the emotional distance to treat any of that with detachment. I just felt attached.

On top of that, DOGE came in and ended up laying off maybe 40 or 50 people. Those were friends and colleagues who joined the team because they believed in the mission — awesome public servants. From a human perspective, that was really tough.

Over time, the program has stabilized. The investment tax credit expanded. Broadly speaking, there’s been significant reinvestment in the program.

Todd Fisher: That’s a little-understood development. The investment tax credit was expanded by 10% in the Big Beautiful Bill. That’s more money than we had to invest through grants.

Mike Schmidt: They also haven’t imposed any tariffs on chips. The actual strategy thus far has been to increase supply-side incentives. We’ll have to see the investment trends over time, but there has been a measure of continuity, and that’s a really good thing — to the administration’s credit, because this is hugely important for national security. Increasingly over time, you just become a citizen like everyone else, paying attention to this part of the world along with all the other parts going through turmoil.

Todd Fisher: For me it was a little different, because Mike left on January 17th and I agreed to stay until March 1st. Those six or seven weeks were challenging. I’d never been through a transition. The day before I was meant to leave, the order came down to lay off all probationary employees, which for us was almost everybody because there was a two-year probation period. Anyone from the private sector who had joined was basically still within that window.

My last 24 to 48 hours were spent fighting to save as many people as we could. We ultimately saved a good chunk — maybe a third or so. But to leave on that basis, particularly on CHIPS, where most of these people had given up careers in the semiconductor industry and the private sector — to feel like they were being vilified, accused of trying to game the system, wondering whether they’d be fired, whether they should take the fork — it was a really difficult environment. When I left, I was shell-shocked. It was a tough, tough time. Everything after that, as Mike said, has been my experience as well.

Some essays I want to write at some point include

• How corruption in China compares to corruption in American politics

• Why Bruce Catton’s The Potomac Army series is better than Robert Caro’s LBJ saga

• Deep dive into the writing in Ian Toll’s The Pacific War series and how he sets up scenes and transitions from individual engagements to strategic dilemmas as smoothly as I’ve ever read

• Over paternity leave I read ten different books on the theme of “oh I raised my kid in X country here’s what it was like”. I could compare and contrast, tier list countries…

Vote for what you’re interested in in the comments?

Top Ten

Religion

Genesis, Exodus, and Prophets.

After a lifetime of reading the torah in bits and bites, dutifully reading footnotes and commentary, this year I tried a new tack with an audiobook bible binge, listening straight through first the Robert Alter and then the King James Bible. Alter feels deeply foreign and startling while KJB’s language gently washes into you. The plotblast in Genesis can be overwhelming but this experience helped my brain refocus away from my natural default of specific verses and word choice and towards broader arcs.

Bob Thurman’s Jewel Tree of Tibet (audiobook) + Circling the Sacred Mountain

Donald Lopez’ Buddhism: A Journey Through History and The Buddha: Biography of a Myth were fantastic intros but the Buddhism books this year that left more of an impact were Robert Thurman’s. His Jewel Tree of Tibet lecture series puts Headspace to shame. This book, a combination of guided meditation and lectures best enjoyed via audiobook, gives a sense of just how strange the Tibetan cosmology is and allows you a taste of it yourself with his Lake Manasarovar visualization. Falling asleep to random episodes of his podcast leads to weird and wonderful dreams.

Circling the Sacred Mountain is a travelogue with paired narrations to a trip to Tibet in the 1990s. One is the enlightened Robert Bowman, the other an annoying hanger-on whose experience is very skippable. I felt the blade wheel of mind reform.

He also does some superb phrase translations, like Superbliss-Machine Embrace (Buddha Paramasukha Chakrasamvara).

Now recall the three roots, finding the points that make the most sense to you: that death is a certainty; that the time of death is completely unpredictable; and that nothing of this life will trans­late into the next except what enlightened qualities you have at­tained. Give up all of your mental and physical possessions, the body that you identify with as your self. Your soul will proceed into new forms, guided by imprints of generosity and morality, tolerance, enterprise, concentration, and intelligence — the opposite of stinginess and fear and paranoia. Forget about the peripheral things. You will go forth with your luminous soul, your sea of infinite bliss, your buddha-nature, so build up that subtle deepest part of yourself.

War Section

Ian Toll’s Pacific Theater WWII trilogy is a modern masterpiece of writing and scholarship. The third book is the strongest, thanks to the drama of the material and Toll’s maturation as an historian over the fifteen years it took to produce.

His chapters to bookend the series are some of the best I’ve ever read. He opened with Admiral Nimitz taking a cross-country train from DC to SF on the way to Pearl Harbor, meditating on the national mobilization and the burden he was about to adopt. The closing climax of Hiroshima, Nagasaki and the decision to surrender, takes the reader from the Truman to the Enola Gay, to the Emperor recording his surrender, a military coup trying to stop the broadcast only for Japanese to hear it across the country is also a masterpiece.

A few masterful pages on the recording and reception of the famous surrender broadcast.

Covered in podcasts here and here.

Eichmann in Jerusalem: A Report on the Banality of Evil, Hannah Arendt, 1963. I would have read this years ago if anyone told me how funny it was! As she wrote to a friend, “You are the only reader to understand what otherwise I have never admitted—namely that I wrote Eichimann in Jerusalem in a curious state of euphoria.” It shows and is so much better for it.

World-historically funny.

Extended excerpts here in my Tel Aviv writeup.

Communism

The Party’s Interests Come First: The Life of Xi Zhongxun, Father of Xi Jinping, Joseph Torigian, 2025. A China book at the level we get only a few times a decade. A true must read for anyone hoping to deeply understand the CCP and Chinese 20th century history. Covered in a podcast here.

Cancer Ward, Aleksandr Solzhenitsyn, 1968.

The Gulag Archipelago, Vol. 1: An Experiment in Literary Investigation, Aleksandr Solzhenitsyn, 1973. Survivor and stylist. Energy and humanity sparks though the prose.

Look around you—there are people around you. Maybe you will remember one of them all your life and later eat your heart out because you didn’t make use of the opportunity to ask him questions. And the less you talk, the more you’ll hear. Thin strands of human lives stretch from island to island of the Archipelago. They intertwine, touch one another for one night only in just such a clickety-clacking half-dark car as this and then separate once and for all. Put your ear to their quiet humming and the steady clickety-clack beneath the car. After all, it is the spinning wheel of life that is clicking and clacking away there.

To the Success of Our Hopeless Cause: The Many Lives of the Soviet Dissident Movement, Benjamin Nathans, 2024. Covered this podcast. A masterful book. For a taste:

Samizdat provided not just new things to read, but new modes of reading. There was binge reading: staying up all night pouring through a sheath of onion-skin papers because you’d been given twenty-four hours to consume a novel that Volodia was expecting the next day, and because, quite apart from Volodia’s expectations, you didn’t want that particular novel in your apartment for any longer than necessary. There was slow-motion reading: for the privilege of access to a samizdat text, you might be obliged to return not just the original but multiple copies to the lender. This meant reading while simultaneously pounding out a fresh version of the text on a typewriter, as a thick raft of onion-skin sheets alternating with carbon paper slowly wound its way around the platen, line by line, three, six, or as many as twelve deep. “Your shoulders would hurt like a lumberjack’s,” recalled one typist.

Experienced samizdat readers claimed to be able to tell how many layers had been between any given sheet and the typewriter’s ink ribbon. There was group reading: for texts whose supply could not keep up with demand, friends would gather and form an assembly line around the kitchen table, passing each successive page from reader to reader, something impossible to do with a book. And there was site-specific reading: certain texts were simply too valuable, too fragile, or too dangerous to be lent out. To read Trotsky, you went to this person’s apartment; to read Orwell, to that person’s.

However and wherever it was read, samizdat delivered the added frisson of the forbidden. Its shabby appearance—frayed edges, wrinkles, ink smudges, and traces of human sweat—only accentuated its authenticity. Samizdat turned reading into an act of transgression. Having liberated themselves from the Aesopian language of writers who continued to struggle with internal and external censors, samizdat readers could imagine themselves belonging to the world’s edgiest and most secretive book club. Who were the other members, and who had held the very same onion-skin sheets that you were now holding? How many retypings separated you from the author?

To Run the World: The Kremlin’s Cold War Bid for Global Power, Sergey Radchenko, 2024. Covered in a two-parter.

A Swim in a Pond in the Rain, George Saunders, 2021. Saunders reprints his favorite classic Russian short stories paired with essays on what each of them illustrate about the writing fiction. I can read much more deeply now thanks to the perspective this book brings. The audiobook featured all-star narration.

Breakneck: China’s Quest to Engineer the Future, Dan Wang, 2025. Covered in a pod with Dan here.

Past Years Best Books

H1 2025.

2024 (+ media diet)

2023

2022

2021

and 2016…

Other H2 2025 books

The British Are Coming: The War for America, Lexington to Princeton, 1775-1777, Rick Atkinson, 2019. I respect Atkinson for the work he put in here but he’s just not on Ian Toll or Bruce Catton war trilogy level. It’s partially a skill issue but also just downstream of the material he’s working with—The Revolutionary War doesn’t have the source material, scale or sense of modernity to give historians as much to work with.

Slouching Towards Bethlehem, Joan Didion, 1968. Was Joan Didion built up too much for me to appreciate her? Like she’s good, but not world historic amazing. I loved this though. California is “out in the golden land, where every day the world is born anew. The future always looks good in the golden land, because no-one remembers the past. Here is the last stop for those who came from somewhere else, for all those who drifted away from the cold, and the past, and the old ways.”

The Secret of Our Success: How Culture Is Driving Human Evolution, Domesticating Our Species, and Making Us Smarter, Joseph Henrich, 2015.

The Kill Chain: Defending America in the Future of High-Tech Warfare, Christian Brose, 2020. Covered on this pod.

Only Yesterday: An Informal History of the 1920s, Frederick Lewis Allen, 1931. The Scholar’s Stage did a great job summarizing this book here.

The Sword of Freedom: Israel, Mossad, and the Secret War, Yossi Cohen, 2025.

Part spy memoir, part political manifesto, incredibly ego-forward in a deeply Israeli way (him bragging about beating Pompeo at a shooting contest at the farm is really something). Interesting seeing someone who wanted to scream to the rooftops about how noble and professional his work is for so long finally getting the chance to do so. Best read in parallel with Rise and Kill First, a journalist’s take on the mossad.

The Forever War, Joe Haldeman, 1974. One interesting idea (literally brainwashing soldiers to do war crimes) surrounded by awful writing, awful characters, and blah sci fi. How is this a classic?

Attack and Die: Civil War Military Tactics and the Southern Heritage, Grady McWhiney and Perry D. Jamieson, 1982. An interesting thesis (Celtic heritage meant Southern officers and soldiers were way too into the offensive) they wait until the conclusion to lay out and don’t really prove, though tactical recklessness was clearly an issue.

War, Bob Woodward, 2024.

The Mission: The CIA in the 21st Century, Tim Weiner, 2025.

U. S. Grant and the American Military Tradition, Bruce Catton, 1954.

The Murderous History of Bible Translations: Power, Conflict and the Quest for Meaning, Harry Freedman, 2016. Great premise but really disappointed, should have picked fewer examples and gone deeper with more textual analysis.

Today, we’re discussing all things gaming in China! Our illustrious guest is Daniel Camilo, a Portuguese national who has spent over a decade in the Chinese video game industry. We cover the most important titles, publishing and development trends, and where the industry is headed.

We discuss:

• How China’s game industry climbed the value chain from low-cost mobile and PC titles to globally competitive AAA releases,

• Why Genshin Impact reset global expectations, becoming the template for live-service “cash cows,”

• China’s domestic market’s newfound self-sufficiency, as hundreds of millions of middle-class gamers mean Chinese developers no longer need international success,

• Steam’s magical liminal status in China as a de facto gateway for uncensored and imported games,

• Why gaming is a global language in ways movies and music aren’t, and how mechanics and genres travel even when stories don’t,

• The Wuchang: Fallen Feathers controversy, where nationalist backlash led to patched-out boss deaths and preemptive self-censorship.

We also cover Daniel’s pick for the biggest Chinese game of 2026, the looming Genshin-style live-service bubble, and how a game set in 1984 East Germany channels distinctly Chinese workplace anxiety.

Listen now on your favorite podcast app.

How China Leveled Up

Jordan Schneider: Watching the industry’s industrial upgrading has been fascinating. It mirrors other Chinese sectors — starting with straightforward, low-capital commercial products, simple 2D PC games and free-to-play mobile titles, and moving up the value chain. Now, Chinese developers are taking big swings with AAA titles featuring eight-figure budgets and quality rivaling global studios. Daniel, is that a reasonable generalization of the past decade?

Daniel Camilo: Mobile remains the largest market slice, but if I want to highlight one title that changed everything — Genshin Impact. Even before Black Myth: Wukong, Genshin shifted expectations. It was a free-to-play title available across platforms that felt like an AAA experience. It demonstrated an ambition and scale previously unseen from Chinese developers — or any mobile developers, for that matter.

Jordan Schneider: Give us a primer on Genshin Impact. Who made it, and how big was it?

Daniel Camilo: Genshin Impact was made by miHoYo and it was released in 2020 as a free-to-play, open-world, story-driven RPG with anime-inspired aesthetics. It was available first on mobile and PC, and more recently on all consoles except the Switch — Xbox was the last platform to get it. The game became a huge success, elevating miHoYo into a global powerhouse and raising the profile of the entire Chinese industry. It’s the “live service dragon” companies chase — a template for constant revenue. The game has tens of millions of registered players.

Jordan Schneider: Players spent $10 billion on it in 2025.

Daniel Camilo: Exactly. It’s a live-service game — the holy grail that all major game companies are chasing for that constant revenue stream. Genshin Impact is the template for other Chinese developers and for miHoYo’s subsequent projects.

At first, many casual gamers globally thought it was Japanese. Unlike Black Myth: Wukong, which is distinctively Chinese, Genshin doesn’t immediately read as such to the average user.

Jordan Schneider: Let’s compare those two. Genshin Impact was this fascinating artifact — one of the very few mega-hits that game developers worldwide chase, generating multiple billions of dollars annually with relatively low risk since you’re just doing updates once you have the golden goose.

But Genshin didn’t scream “national pride,” though they’ve had expansions with Song Dynasty- inspired content. In contrast, the two biggest recent AAA hits, Black Myth: Wukong and Wuchang: Fallen Feathers, are culturally loud and proud in their marketing and aesthetics. Is this shift a sign of cultural confidence? Did the fear of needing “wizards and castles” for Western appeal fade because the domestic market became sufficient?

Daniel Camilo: Let’s start with Black Myth: Wukong — the pinnacle so far. It was an uncompromised passion project. Initially, many — including myself — were skeptical, suspecting the trailers were just scripted vertical slices. But the final product delivered. If a game is good, themes don’t limit its reach. We saw this precedent with Japanese RPGs in the 80s. Black Myth sold at least 7 million copies outside China, proving that quality transcends cultural barriers. Gamers know games, and if a game is good, that’s what matters. Gaming is universal in that regard.

Jordan Schneider: The other big takeaway is that Black Myth made about $2 billion, with 75% of sales domestic and the US at around 10%. The domestic market alone is now large enough that international sales aren’t even that relevant anymore.

Historically, high-end gaming in China was limited by hardware. People had phones but didn’t necessarily have gaming PCs or consoles at home, so they’d go to a gaming cafe or opt for low-spec games like Dota or League of Legends. How has the rise of household gaming hardware changed market dynamics?

Daniel Camilo: In the 90s, China’s market was mostly bootleg consoles and imports. PCs gained traction in the very early 2000s, but starting around 2007, smartphones created the boom in mobile gaming that would become — and remains — the biggest slice of the market in China and globally.

However, China now has a massive middle class numbering in the hundreds of millions. They can easily afford high-end desktops, laptops, and consoles. Over the last decade, gaming has democratized. Consumers now have options and choose to consume premium products, mirroring developed markets.

Jordan Schneider: Let’s stay on developers. Game development costs have lowered due to tools like Unity, and it’s now less difficult to pull off ambitious triple-A games. How are these technological trends impacting Chinese developers’ calculus?

Daniel Camilo: Unity and, most obviously, Unreal Engine — which Black Myth: Wukong and Wuchang were both made with — have been huge. Major Chinese developers have moved away from proprietary engines. Recently, Escape from Dukov, published by Bilibili, was likely made in Unity by a tiny team and sold over 4 million copies. Game Science developed Black Myth: Wukong — one of the most technologically impressive games ever — in about two and a half to three years of active development.

Last year, the whole industry was celebrating how the French studio Sandfall Interactive developed Clair Obscur: Expedition 33 with only a small budget using Unreal. But that’s exactly what the team from Black Myth: Wukong did three years earlier.

Jordan Schneider: And Black Myth was real-time action, not this weird turn-based system.

Daniel Camilo: Black Myth looks infinitely better from a technical perspective — not necessarily artistically, but it’s much more ambitious than Clair Obscur. Yet, it started with a core team of 20 to 30 people, similar to Sandfall. It should have been more celebrated and recognized because it shows what we can expect from Chinese developers going forward.

Wuchang is a huge game as well — it’s my personal Game of the Year. I was surprised by how much I loved it. Despite launching with optimization issues and tons of negative reviews on Steam because of that, they’ve recovered. And the fact that they built such a massive game in roughly two years is mind-blowing. It’s still very early in the history of triple-A development in China and it demonstrates the high competency we can expect from Chinese developers.

Unkillable History

Jordan Schneider: Let’s talk about Wuchang: Fallen Feathers. I put five hours into it as diligent prep for this interview. The 101 is that it’s a SOULS-like set with Chu Dynasty and Ming Dynasty influences. I’d say it’s more playful than something out of FromSoftware. How else would you characterize it? What was so impressive to you?

Daniel Camilo: It is fundamentally SOULS-like. The multi-layered level design is some of the best I have ever seen, rivaling the sense of exploration in Elden Ring. The level design is some of the best I’ve ever seen — and I’ve been playing since the NES, since I was two.

It’s one of those games where I kept thinking about it, even when I wasn’t playing it. Unfortunately, post-launch controversies and scandals tainted its reputation and the studio went pretty silent after that.

Jordan Schneider: What were the scandals?

Daniel Camilo: About a month after launch, they patched the game and changed a lot of the outcomes. Originally, players could kill bosses based on famous Chinese historical figures. But hardcore nationalist gamers complained, leading to huge review-bombing on Steam.

The developers reacted by making these characters unkillable, which actively changed the story and rendered the narrative nonsensical. They essentially preemptively self-censored the game through a patch, which was weird because, as far as we know, there were no explicit demands from the government or authorities to regulate the game.

This spilled over to gaming media internationally — major outlets like IGN covered it extensively. And this reinforced the stereotype that Chinese games are heavily censored. Now, when future triple-A games from China come out and something controversial emerges, people will more easily expect the game to be censored and will be more apprehensive. It was an unfortunate thing to happen because the game is phenomenal.

Jordan Schneider: This is illustrative of a few themes. Black Myth: Wukong was entirely mythological — you were fighting demons and dragons. Wuchang: Fallen Feathers has this fall of the Ming Dynasty arc, featuring historical figures, like Zhao Yun (赵云) — one of the Shu generals from the Three Kingdoms — whom you could no longer kill after the patch.

Game developers aren’t stupid. They aren’t making thrillers about contemporary politics. They understand the pressures on them, just like anyone making movies or TV shows. They also understand that their core audience includes a subset of hyper-nationalist men who are tuned into this sort of thing.

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Who knows if they received a call from the government or if they were just worried about online chatter? But it is illustrative that even a seemingly anodyne, quasi-fantastical story about people infected with a bird disease can spin out into a situation where you have to radically change the plot. You get international coverage and domestic blowback asking, “What are we even doing here?”

This dynamic will likely constrain storytelling in China for a long time. If even this can get you in trouble, it sets a strict boundary. However, as you alluded to, many players aren’t there for the stories. They are there for the mechanics, itemization, and gameplay loops. One long-standing theme of ChinaTalk is the challenges of Chinese television and movies to make a global impact. But the storytelling and censorship challenges are almost less relevant, I’d argue, in a video game context than when you’re making TV and movies, where the story is the entire point of the cultural product.

Daniel Camilo: Absolutely. That is why gaming is more likely to become the spearhead of China’s cultural soft power — much more so than movies or music. Creatively speaking, hands are much more tied in those industries.

For example, we used to see a robust output of Hong Kong movies tackling dense, political topics. Since the National Security Law went into effect, edgy Hong Kong cinema is effectively dead. Everything must be tamed and approved by Beijing. I don’t think there is any chance for movies to compete with gaming in this regard. Because of the gameplay and interactive aspects, gaming can appeal to audiences and be creatively much more expansive than any other art form coming out of China right now for the rest of the world.

Some interesting games are coming out that challenge expectations. There was a popular survival horror game on PC this year — it’s a third-person game similar to Resident Evil. It’s very gory. It featured a very sexualized female protagonist — you could play with her in a bikini — which is a “low-brow” style you wouldn’t expect.

Then there’s Showa American Story, a Chinese game about a post-apocalyptic alternative future where America has been taken over by Japan. It’s a very gory, ultra-violent game that challenges what we’d expect from a Chinese developer in terms of themes. If it were made into a movie or released domestically in China, it would almost certainly be heavily censored or banned.

Steam’s Gray Zone in China

Jordan Schneider: Let’s talk about the weird liminal space that Steam exists in within China, which allows things that wouldn’t pass censorship to reach Chinese audiences. Where is Steam today?

Daniel Camilo: This is what I talk and write about most. There is an official Chinese version of Steam, but very few people use it — it is essentially irrelevant.

Most Chinese gamers use the international version of Steam to access games, and that’s how most developers and publishers from around the world release their games and find Chinese audiences.

China has become, if not the most important, at least one of the most important markets for PC gaming in the world, particularly in the last year and a half. This relates to the culture of imports and the “gray market.” Even though consoles like the PlayStation 5 and the Tencent-distributed Nintendo Switch are officially licensed and have Chinese models, most consumers still buy games digitally through other regions (like Hong Kong) or physically via imports on Taobao. You can find almost any game very easily, even those not licensed for distribution in China.

Informed gamers — and there are many in China — know this and buy those games. It doesn’t matter if a game is officially available. People will find it. Games like Cyberpunk 2077 sold millions of copies in China through Steam, even though the game wasn’t officially launched there. A prime example is Stellar Blade. When it launched on PC in June of this year, China immediately became its biggest market globally. Developers are finally realizing they can find an audience in China without a formal launch. You now see international studios actively marketing their games on Chinese social media — either directly or through local agencies — because the potential and data are undeniable.

Jordan Schneider: I want to return to the idea of gaming as a universal language. Many people don’t realize that game development is not mainly US-based, but it’s fully global — spanning French Canada, Eastern Europe, etc. — and most of the time people are making games for a global audience, not just their home country.

Unlike movies or music, where consumption is often local, the “gaming diet” is global. Even though China has an enormous protected market, all those gamers grew up on international titles. The gaming language, gaming tropes, the skills players have developed, and the expectations they have are really global and universal. For music or movies, most people either grew up on their home country’s content or American TV and movies. The gaming diet that most people have consumed from when they started gaming is global, not national. This shared literacy allows for these global mega-hits, which developers have been chasing for decades.

Daniel Camilo: Absolutely. Developers often underestimate how familiar Chinese gamers are with global IPs and genres. When I speak to studios, they often group China, Japan, and South Korea into a single “Asia strategy.” I always explain that China is its own planet.

For example, First-Person Shooters (FPS) like PUBG, Counter-Strike, and Crossfire are immensely popular in China, whereas this contrasts sharply with Japan, which has traditionally been “anti-shooter” regarding titles like Call of Duty or Doom.

Sports games and fighting games are also massive. Basketball games are very popular in China as well as “beat-’em-up”s. The King of Fighters is a household name in China, similar to its status in Southern Europe and Latin America, whereas the US leans toward Mortal Kombat or Street Fighter.

I find it surprising that Japanese developers are still concerned whether Western audiences will “get” their games, despite decades of data proving that yes, people will buy Final Fantasy, people will play Dragon Quest, etc. They love them because they’re their own thing.

And in China, in the past few years, there’s this focus on triple-A, PC and console games, because mobile market saturation and strict regulations have pushed developers toward PC, console, and international expansion. Regulations, especially five or six years ago, before COVID, really stifled development and pushed many in China to look elsewhere and start developing internationally. This is why Tencent is acquiring and investing in more studios internationally.

Hype, Saturation, and What Survives

Jordan Schneider: Looking toward 2026, what trends or titles are you watching?

Daniel Camilo: The one big game that will be the next big hit from China in terms of triple-A gaming is Phantom Blade Zero for the PS5 and PC, and the developers have said it might come to other platforms after a temporary exclusivity period. It rivals Black Myth: Wukong in terms of hype among core gamers. I’m fairly confident predicting it’ll be the next big hit in terms of premium games.

Another trend I’ve been alerting people to — we have this big wave of free-to-play, cross-platform, crossplay games in the vein of Genshin Impact, games like Neverness to Everness, Zenless Zone Zero, and Ananta. They all have similar aesthetics and this anime-style art direction.

So, there’s the risk of stagnation and saturation with audiences spread thin. Some of these will flop next year. Some come from the same companies — NetEase, HoYoverse — and they’re seeing this happen, for example, with games like Honkai: Star Rail cannibalizing the same audience from Genshin Impact. It’s not sustainable. We have many dozens of games in this vein being developed, coming out in 2026.

That little bubble in that genre will implode very soon, forcing developers to diversify their genres and monetization models. It won’t be great for some companies financially, but for gamers it’ll ultimately be a very good thing.

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Jordan Schneider: Let’s close on perhaps the most curious or unique hit to come out of China over the past year — Karma: The Dark World. The logline is a first-person cinematic psychological thriller set in a dystopian world where the Leviathan Corporation is omnipresent. The year is 1984, the place is East Germany, and things are not what they seem. This was something remarkable, wasn’t it, Daniel?

Daniel Camilo: I almost forgot about it. It’s one of those games that nobody would guess is Chinese. But when you play it — having worked in Chinese companies here for more than ten years, I recognize a lot of the workplace anxiety and “oppression” that you feel as an office worker in China. It’s very well translated into the game. I won’t spoil exactly how, but you can almost feel that the people who made this game were annoyed, that they wanted to say something, to complain about this whole office work culture in China. It is a remarkable, artistic piece of work.

Jordan Schneider: “The Leviathan Corporation rules with an iron fist, controlling its citizens through mass surveillance, social class rules, mind-altering drugs, and the promise that the gates to Utopia will open to those who serve.”

It’s remarkable. It’s also fully voiced in Chinese, which is pretty cool if you’re looking for an excuse to practice your reading and listening. Coming back to Steam — one of the beauties of it is that I don’t think this game would be getting a license going through some government body by any means. But games exist in this magical liminal space because the Chinese government is too afraid to shut down Steam and anger the gaming population, so the platform remains a loophole for domestic audiences to access weird, wonderful, and unregulated culture without a VPN.

Daniel Camilo: The game, Karma, is also surprisingly hilarious. It has a sense of humor I’ve never seen before in a Chinese game. I was laughing out loud at the writing. I would love to know the people who made this game because it’s really hilarious. It is magnificently written.

Jordan Schneider: We’ll try to get them on the podcast. Maybe we’ll have you co-host, Daniel.

Check out Daniel on Substack — he writes a newsletter called Gaming in China.

Economic security is having a moment. From the IRA and CHIPS Act to Trump’s Intel deal and critical mineral stockpile, both parties have recognized that the government needs to take a more active role in markets to preserve US power and long term growth. But deep thinking about the long term goals of industrial policy and economic security are still lacking.

To kickstart thinking, ChinaTalk is running a series of essay contests.

The two prompts we’ll start with:

• What are the most important high level KPIs that policy should aim for? What is the analogy of the Fed’s ‘2% inflation and full employment’ target for economic security?

• Where today would you put $10-50bn to get the most for your investment in economic security? Feel free to propose both defensive and offensive ideas, and either a portfolio of ideas or the one large idea you think will deliver the most value.

We have an all-star list of judges for this essay contest, including

• , former NSA now at the Harvard Kennedy School

• , Chip Wars author and belt-holder for most ChinaTalk appearances

• Dan Kim, former Chief Economist for the Chips Program Office

• , author of Breakneck

The best essays will receive a share of a $3000 prize pool and will be reposted on ChinaTalk. Aim for 2500-4000 words.

Submit Your Essay Here.

Deadline March 1.

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Today’s guest is the legendary strategist Edward Luttwak — the Machiavelli of Maryland. He’s consulted for presidents, prime ministers, and secretaries of defense, and authored magnificent books on Byzantine history, a guide to planning a successful coup, and an opus on the logic of strategy and the rise of China. He raises cows, too.

If you were intimidated by our three hour transcript from yesterday…

This is the condensed version of the transcript.

Our conversation today covers…

• Luttwak’s childhood and formative encounters with war, including an early fascination with the mafia in Sicily,

• Technological step-changes in warfare,

• Books that shaped Luttwak’s view of war, from Clausewitz to the Iliad,

• The costs of “removing war from Europe” post-1945,

• China’s strategic missteps,

• The psychology of deterrence, including what kind of Middle East policy would actually deter Iran,

• The strengths of democracies vs. autocracies.

Listen now on your favorite podcast app. [Note—we recorded this in the summer of 2024]

Deterrence

Jordan Schneider: What is the right way to conceptualize deterrence?

Edward Luttwak: Realize that everything about deterrence is taking place in the mind of the enemy. You don’t deter by building a missile or by not building a missile or buying this or buying that. You deter by understanding your enemy and understanding what deters him.

For example, right now, the United States periodically attacks the Shia militias to deter them. Actually, they’re just exact agents of the Iranians. Not only do all their weapons come from Iran, but they’re commanded by Iranians. You can’t deter Iran by killing Houthis, because the Persians do not consider Arabs to be people whose life or death is very important.

You cannot deter Persians by killing Arabs. They consider Arabs expendable. Arabs are not much use for anything, so give them a weapon, have them shoot at other people. They’re not Persians. If you want to deter Persians, you have to kill Persians.

That simple proposition doesn’t get through in the White House, because it cuts against the concept that all races are equal, of course, and we would consider Arabs equal. Therefore, the Iranians must consider them equal.

The Shahnameh is the national book of Iran. The Ayatollahs wanted to forbid it, because it’s not Muslim. The guy who wrote it was post-Islamic, but the Shahnameh is a book about Persia, about our Persian kings and Persian heroes, not about Islam at all. Then, as soon as they got into war with Iraq, suddenly, they started printing editions of Shahnameh, pocket editions, big editions, ceremonial editions and so on. The White House hasn’t read the Shahnameh. If you read the Shahnameh, you realize that you cannot deter Iranians by killing any number of Arabs.

Deterrence starts with that. Deterrence starts with understanding the mind of the enemy. What will deter him? Because you don’t do deterrence. Deterrence happens in the mind of the enemy. Therefore, it’s conditioned by what the enemy thinks is dangerous and not dangerous. You could not deter a Japanese suicide pilot, because he was serving the emperor. He was achieving the maximum possible thing.

Imagine I could sink an aircraft carrier, bringing so much joy to the emperor, and I will become famous. No way you could deter this. You have to deter by starting the mind of the enemy.

Now, in the case of the Soviet Union as an empire that was built on strategy, Russia was and still is today the largest country in the world. Nobody gave it to them. They got it because they won the wars. They won the wars because the Russians understand strategy. They understand only two things, poor Russians, mathematics and strategy.

You have to understand that to deter the Soviet Union, what you had to do was to say to them, “Okay, remember World War II? We are going to destroy much more than the Germans destroyed. Much more.” The doctrine came out, a massive retaliation. That was a perfect doctrine for Russia to understand.

Now, it’s much harder to deter Iran today, because [during the Biden administration] when the Iranians look at Washington, they saw Robert Malley, who was their agent, basically. I don’t say he was an agent in the sense of being a paid agent, but he was somebody who was highly sympathetic to Iran and hated Saudi Arabia and hated Israel. He’s a second-generation Zionist hater. His parents hate Zionism so much that they work for the FLN in Paris.

They saw Malley, who is the ally. They saw Sullivan, who was a very nice young man at the time. He was the one who negotiated in Vienna and made all the concessions under the table to the Iranians. Along with Burns, who was the head of CIA, but also a very important advisor, really.

Burns and Sullivan in the window, that’s America. Iran felt that these people were easily manipulated. Because they are in a window, it’s much harder for the United States to deter. Certainly, you cannot deter by killing Arabs. Not Iran. Their national culture is the Shahnameh, the book of the Shah. That’s their poetry. In this book, the Arabs are the vandals, who came in and attacked the Iranian civilization and put nothing in its place. They’re nothing, these Arabs.

Jordan Schneider: How about deterrence in China, though?

Edward Luttwak: Well, deterrence in China is, first of all, we have to recognize that in spite of everything that we could have expected, the modern autocracy is a very strong institution. Trotsky said that once you had the machine gun, you couldn’t have an insurrection. The only one who didn’t do it was the Shah, because the American ambassador kept telling him, “Above all, don’t shoot. Don’t shoot. Don’t shoot at these crowds.”

If the imperial guards in Tehran opened fire and killed 1,000 people in front of the palace, we wouldn’t have all these problems. Trotsky did not point out that the prince could lose his nerve. If he loses his nerve, the Maxim machine gun with 500 rounds per minute doesn’t help you.

Jordan Schneider: How should we conceptualize deterring China today?

Edward Luttwak: First, you have to accept that it’s an autocracy, that despite everything that’s happened, single men were making a huge difference. Saddam Hussein’s mistake was that other Iraqi potentates who were living very well under Saddam did not preserve their way of life by killing him at the last minute when he failed to surrender to the Americans, which is what he had to do. Then, they could all keep their mansions and everything.

We have to deal with Xi Jinping himself. They obey Xi Jinping. Xi Jinping has a way of getting rid of people who disobey. I have no evidence whatsoever for what I’m about to tell you, but it’s about the former defense minister [Qin Gang]. One of the first things he did was go to the Shangri-La diner in Singapore, as I did.

Now, I go to this dialogue, and a journalist asks him, “What about war with America?” He says, “It will be a terrible, terrible, terrible disaster. It will be an awful, awful, awful disaster. It will be catastrophic, catastrophic disaster.” He got fired. There were stupid stories about corruption.

I believe that the Chinese ambassadors in Washington who lived here in Washington as in Washingtonian, goes back to Beijing. He’s briefed by Xi Jinping about his plans, and he manifests no enthusiasm. May even have said, “Don’t do it,” or something — and he then disappears. Literally disappears.

The story that spread — that he was having an affair — is complete rubbish. Not believable rubbish. It remains that even one newspaper man repeated this accusation without saying so, because the Chinese ambassador in Washington, everywhere he goes is, of course, he has his own security that follows him. Everywhere he goes, the Chinese spies follow him, and the federal protective service follows him. For him to have an affair, he had to accommodate three people in his bed.

They had found a photograph of him being interviewed by a beautiful woman, and that was the story. That he was fired because of an extramarital affair — nonsense. He was fired, because after living in Washington, he is brought back. Once he’s elevated to foreign minister, is briefed about Xi Jinping’s intentions, which is to rejuvenate China by starting a war with Taiwan.

For which purpose? Farmers all over China last year were under orders to stop cultivating spices, fruits, vegetables and all kinds of things, or even keeping ducks, because you have to grow grain. Because in 2022, China imported about 130 million metric tons of grains, which represents the largest traffic in the world’s oceans except for iron ore and petroleum.

Now, how do you rejuvenate? Well, by seizing Taiwan. Of course, you run into an American warship or two, and then you have a skirmish, but it doesn’t escalate because we all have nuclear weapons. You establish the fact that the Chinese are a great fighting nation. They fight Americans, they fight the Taiwanese and all that kind of stuff. Then, we win a victory, and that is how we redeem Chinese history after the century of humiliation. That leads to the 1979 war with Vietnam. China attacked Vietnam. Vietnamese killed 50,000 Chinese. The Chinese walked off and gave up, and so on.

Incidentally, in the Korean War, they not only fought bravely, but they threw themselves against fire because there were Kuomintang soldiers. The Kuomintang soldiers, each of them would prejudice their family, and the family was blackballed because the son was in the Kuomintang. If only you were killed in Korea, your family would become red. By becoming red, they would have access to land and be able to survive, instead of being condemned to death, because when they allocated land after the landlord reform, black families didn’t get any and so on.

In other words, he has built a whole castle of things to do something highly illogical. For the Chinese — for whom global commerce is the key to prosperity — to challenge the US Navy is totally irrational. In order to rationalize the irrational, you have to fantasize that the Americans have a plan, that a certain moment they will intervene and stop all commerce.

Then, you connect it with your rejuvenation of the Chinese people, and you bring in the fact that the Chinese were a defeated nation, that foreigners conquered. Foreigners came, killed them, raped their women and ruled them. Now, we’re going to rise up.

This is like Benito Mussolini, who is the only Italian who understood that Italy did not, in fact, win the First World War, which was taught in schoolbooks, and who put children, schoolboys, in uniform, got them little rifles and all the walls in Italy when I was a child were still written with the slogan, “Better one day as a lion than a hundred years as a sheep.” He was fighting to make Italians a great warrior nation.

He was an honest man intellectually. At the end, he realized, and he said, “It is not true that it is hard to rule Italy. It’s useless.” Meaning that he had wanted to turn Italians into warriors. Xi Jinping is doing the same.

Jordan Schneider: Why is that idea so seductive?

Edward Luttwak: Well, for obvious reasons. Before you had nowhere to live. Now, you have at least a decent apartment all over China. There are very few people who are still living homeless. They exist, but they’re few. I’ve been to all the peripheries of China, remote peripheries, although not last year, but over the years. There are plenty of people living in hollows, and caves and so on.

Now, you have a place to live. Food is not a problem unless, of course, you start a war with Taiwan and so on. All the food in the world, so much food that Shanghai people protested when under lockdown because the food hampers they got from the municipality were not good. Well, if they had given them to the Chinese throughout history, until a few years ago, they would have been blessing the municipality, crying in their emotion of how much food they were getting.

Now, they said they were starving. Starving because they didn’t have things like yogurt, which did not exist in China at all before. When I was in China, under Mao, milk was available on a limited basis only for children. Naturally, there was no yogurt. The yogurt didn’t exist as a product. Yogurt was known to the Chinese as something that the barbarians were drinking. Smelly thing, a horrible smelly thing, who wants that? People ate rice, wheat, and sorghum.

Now, there’s prosperity. Now, the question is, “Okay, what else can we do? Well, we can build the fleet. We can challenge,” and so on. Now, they’re not building an army. The army is under one million. Their deployment of about 120,000 or so in Tibet to face the Indians is a really big strain for them. Most of the borders are unguarded, but they’re building up the navy.

There are all kinds of problems for the US Navy. The US Naval Sea Systems Command makes it impossible to build a fleet, because they elaborate and overelaborate and triple-evaluate every damn ship. Naval Sea Systems Command is a cult dedicated to perfectionism in a single ship that costs so much that you can’t have a flotilla and so on. We have all kinds of problems, but the Chinese can’t fight.

Jordan Schneider: You talked a little bit about the edges that autocracies have in your book with being able to have operational surprise and so on.

Edward Luttwak: They can launch a surprise attack.

Jordan Schneider: What do democracies still have going for them?

Edward Luttwak: Well, democracies have historically done very well. Autocracies don’t have a mechanism to correct mistakes. Xi Jinping wants aircraft carriers, even though aircraft carriers as a collective are becoming obsolete. China doesn’t need them at all, because they can dominate the space around China with missiles.

What democracy is going for itself is much more initiative at every level and the ability to have true enthusiasm through dedication. When you do things under orders, you don’t manifest it, you lose the capacity for the actual enthusiastic individual response, which doesn’t just want to look doing the right thing. The Chinese are constantly striving to appear to be doing the right thing. In a democracy, you actually care to do the right thing, you want to succeed in doing it, and so on, so forth, not to appear to be doing the right thing.

There are no fierce parades in Israel. The Israeli army doesn’t parade going up and down and all that stuff. Only when they’re called to war do they come. These reservists, some of them came from mansions in Silicon Valley. People came from mansions in Silicon Valley, who were not called, and who ended up using their influence to elbow themselves into a unit to be able to fight and so on. You don’t get it in autocracies.

Removing War from Europe

Jordan Schneider: Give us your pitch for reading Homer. What can you learn in there that you can’t learn anywhere else?

Edward Luttwak: If you read the Iliad carefully, you realize that the Iliad presents a superman, because remember who the hero of the Iliad is, Achilles. Achilles is somebody who feels sorry for the Gods, because the Gods are immortal. Therefore, they can never be brave. Therefore, they can never impose their personality onto the universe, because they can do any foolery they want. In fact, there’s a chapter in the Iliad about when the Gods start fighting, and it’s a comedy. It’s ridiculous. They can’t die, so what’s the point?

First of all, it’s the only book that gives man his full dignity, because man is not afraid of death. Being guaranteed against death means that you can never be brave. If you can never be brave, you can never be fully achieved. You are superior to God, because you’re not immortal.

The Iliad teaches you really what bravery is about, and how life would be truly tragic if you were in the position of a Greek God. Because the Greek God cannot die, he cannot be brave. Therefore, he cannot be fully achieved. Everything he does is foolery and pointless. Whenever a Greek God feels like having sex, he can just transform himself into an eagle and pick up a girl or a boy, as the case might be, as Zeus did for Ganymede himself, and you can have your way. You can do anything you want. Therefore, none of it means anything.

That’s what you learn from the Iliad, which is — human being, don’t complain. Assert yourself. Make yourself realize yourself. That’s what counts. That’s the ideology of it.

Then, of course, it has all these different characters in it. For me personally, one of my great happy moments is I discovered from the translation of the correspondence, the Hittite correspondence. Troy was under the sovereignty of the Hittite empire. When they found the correspondence of the Hittite empire, they found a series of letters about Troy. They were found in the 1930s, and translated and made available belatedly in the 1950s, that’s when the Trojan War went from literature to history. You have there the figure of Alexander, also known as Paris, the one who provoked it all, and you also have Achilles.

His Hittite translator’s name is really bizarre, but the Hittite ruler is writing to Agamemnon and saying, “I understand you have a war against Troy. Troy is really a protector of the man, but I know they caused the war. But as for this other guy, Achilles, he raids my towns without any reason at all. This has nothing to do with your war. He’s supposed to be besieging Troy, and there he’s going off raiding.” Achilles grabs the daughter of this priest and so on, and then rapes her, and then he falls in love with her.

Then when they want to take her away, this is the daughter of the priest, and give her to Agamemnon, which starts the whole machinery of the story, because he doesn’t write in Iliad how the war began. It’s the 10th year of the war, and there’s this episode, not between Greeks and Trojans, but Achilles as a Greek prince was falling against the great Agamemnon, who is obliged to give up the girl he captured, because she’s the daughter of a priest of Apollo. Therefore, Apollo was attacking the camp with his arrows, and that’s why they were dying of plague and so on.

He has to return his girl. Achilles refuses to fight. He goes to his tent and says, “Even though I captured her with my spear, I won her with my spear, I’m truly in love with her. I really love her. He took away this woman I really love.” Suddenly, we realize that war was not yet a collective thing. Inherently, it was voluntary. That opens the door to something very important.

Most wars of history have been fought by volunteers. If not by actual volunteers, there are some regiments that were called to war, and people rushed to war. On October 7th, Israel was caught by surprise. On October 8th, they started issuing notices to reservists.

By October 10th, a problem built up in the Israeli army, because they had recalled reservists to the units they belonged to, which were reserve formations with all the workers, but whose commanders and so on would arrive from active duty, full-time jobs. Then, the soldiers arrive from their homes and they go to a depot. In the depot, they pick up their uniforms, their weapons, their vehicles, and roll out.

They discovered within two days of the recall that many more people had shown up, people they didn’t call. Let’s say, in this battalion, there were 400. Of the 400 reserves, there were 520 reserves in the book. They didn’t call the others because they were older, or because they were marked as having some medical issues at some point. These people who were not called up, all went anyway. They showed up anyway. This is a wonderful thing. You call 100 soldiers, and you get 120. Isn’t it wonderful?

Except that if that happens at the company level, two levels, up at the brigade level, they think they’ve got 100 soldiers in that company, but it’s not. It’s 130. They send trucks for 100, and the other gets stranded. After a while, they started issuing public notices, the police, “Don’t come. Don’t come. Don’t come unless you’ve really been called.” Then in some cases, they had to call the military police to weed out people, because they’re all there with friends, and they were covering up for each other. That is a reservist being called, you call 100, you get 120.

What happened more often in war, they didn’t have a system, that’s peculiar to the Israeli army, is that wars were fought by volunteers. People went to the colors, they volunteered to fight. The two World Wars were great anomalies when giant state bureaucracies compelled a lot of people, including very reluctant people, to go to war. Historically, wars were fought by volunteers who wanted to go to war.

The Iliad tells you why you want to go to war. Heroic achievements, the fun of it, the excitement of it, and all the rest of it. If war were not so much fun, there wouldn’t have been so many wars, because most wars were fought by volunteers. In the Civil War, there were draft riots in New York because people didn’t want to fight. That was because America was very early in conscription. Conscription, forcing people to fight, is very new. In human history, it’s a very recent development, from which there’s been a withdrawal.

Now, this brings me to a very important thing that is a tragedy on a continental scale. The energy of Europe, the dynamism of Europe, the whole thing that came out in art and science and everything else, is such that when Europeans got to that historical stage, they spilled out on the whole planet. Small numbers of Europeans conquered Latin America, conquered Africa, and conquered much of Asia. Why? Because they were forged by Europe. The intense competition between rival states that competed even more because they shared a common culture to a large extent.

Every little state was competing with every other state that generated dynamic energy. Europe was like a veritable nuclear reactor of energy from the collision of all. Florence fighting against Venice and Siena against Florence, Milano against — and then, Italy against France. This war was the engine of European growth. That’s why the Iliad was the actual constitution of Europe, not the New Testament. It was the Iliad.

The Iliad is the constitution of Europe. All these little European statelets were competing against each other. There were perpetual wars. Every war destroyed buildings. After the war, they built twice as much. The warriors went to war. They loved war because they were all — 99% were volunteers. Until you get really to the first 19th century, really, late 19th century, you get volunteers.

Men love war. Women love warriors. Instead of the population going down, as soon as the war ended, the warriors would come back, women would jump on the warriors and vice versa and make children. From war to war, Europe’s population increased. Europe was a land of children. Every time there was a war, there’d be more children. And then, there’s more reconstruction.

Now, somebody had this idea of removing war from Europe. There were problems with war by 1945. Not only the fact that the Second World War was really horrific, more than any other war, really, but also, the advent of nuclear weapons made it seem a bit pointless. There was definitely a problem. There was exhaustion. The exhaustion of 1945 is a simple, normal exhaustion that you had after every war for 2,000 years. Then, there was the nuclear fact as an intellectual fact somewhere out there. Then, there was the fact that the war was particularly horrific.

It was long. It was long, ‘39 to ‘45, long and horrific and a lot of disappointments. There was a lot of really huge destruction and so on, killing and many more people died and so on.

Europe gives up war and you say, “Oh, wonderful, there’s no war.” What they did was they removed the engine of the car. Because, since you remove war from Europe, there are a number of other things happening. First, Europeans stop making children. The most pacifist societies, Spain and Italy, make the fewest children. There are more veterinarians than pediatricians in Northern Italy. There’re not children, actually, and there’s no dynamic energy. All of it is gone.

War was a machine. It was the intense competition between all the different European states and statelets, by putting them all in a union together where they can’t fight each other, the armies, navies, and air forces remain as ritualistic things. They have no real combat capability. The Royal Air Force recently flew to Cyprus, and from Cyprus to Yemen, and dropped bombs.

There are air forces in other countries, and they have generals and airplanes, but they can’t do it. If the Italian air force were ordered to bomb Yemen the way the Royal Air Force would, they would have a big advantage, because the Italian air bases are much closer to Yemen than the UK. The order would never be issued.

Right now, Italy has a right-wing government, or at least center-right. What Prime Minister Meloni puts on a tweet is a celebration because the big Italian warship, the Vulcano, a very big ship, came back from El Arish carrying some Palestinian children who need medical care. Whereas the Italian ports are in distress because traffic is interdicted in the Red Sea, which means that Italy is bypassed. This affects the Italian economy powerfully.

The Italian Navy is the largest in the Mediterranean. She does not send it into the Red Sea to defend traffic to save the Italian economy. Instead, she sails a ship to El Arish to pick up some Palestinian kids. Why? Because even the center-right government, in fact, neo-fascist or whatever she is, has decided that war is no longer admissible. In fact, they have sent one frigate to the Red Sea, but not as part of the US Anglo-American Operation Prosperity Guardian, but separately as a European mission with the Germans or whatever. Not only are they not attacking the Houthis, of course, but they’re not even intercepting Houthi missiles, unless they aimed at themselves.

You can divide nations into two categories. Three, actually. One is countries for which war is irrelevant. Like Nauru, for example. 1,000 people in the Pacific with no enemies who can reach them. War for them does not exist. It would be absurd to bring a war philosophy to Nauru in the Pacific. For everybody else, I use the very ancient Latin concept that only I use, which is capax belli. Capax, capable of war. Bellum, of course, is war. Genitive is belli, capax belli.

If you go and research and try to look for the original quotation of it, you won’t find it, because I invented capax belli. It’s an ancient Roman concept that happens to have been invented in Maryland, by me. It is a useful concept. Countries capable of work and those that are not. The British spend a lot of money on the Royal Air Force, but the Royal Air Force is capable of war. It just flew to Cyprus and Yemen and dropped bombs.

The other air forces in Europe also cost a lot of money. They’re also expensive, but they’re not capable of war, because either the political level cannot issue such orders, or they go against the spirit of the age, as they would put it. All because the pilots didn’t really sign up to really fight, “What? I’m supposed to be flying over Yemen? What happens if I get shot down? I’ll be taken by tribesmen who will tear me to pieces.”

There’s no enthusiasm. I don’t see protesting airmen all over Europe saying, “How come we are not helping to fight the Houthis as well? I’m a fighter bomber. Why don’t you let me fly on it?” No such thing.

In some cases, like Spain, the Spanish have an air force, they do, and they have combat aircraft, and they’re not cheap. If the Spanish government ordered them to bomb Houthis, they would not do it — there would be a protest. The pilots would walk off.

Once you’re not capax belli, you have lost something that binds your country, makes the country effective as a country and makes military institutions valid. If you are not capable of war, that doesn’t mean logistics, like you don’t have enough ammo or something, that’s never a problem.

Jordan Schneider: It’s a psychology of political leadership.

Edward Luttwak: The psychology, the culture, the political thing. By the way, right into the military. When Italian soldiers were deployed in Afghanistan, it was essential they should not go into combat. The Taliban were paid off, basically. They paid off the Taliban so they could patrol unmolested. Once you knocked capax belli, you switched off the engine, and you lack dynamism, you lack capability. You can’t do anything else either.

Jordan Schneider: There’s an interesting argument you make in the China book, where you look at Germany in 1890, and you say they had it all. They had the chemical companies. They had the universities. They had the economic dynamism. Had they not wanted to taste the forbidden fruit of national greatness as expressed by hard power in the form of battleships and international colonies, then the 20th century probably wouldn’t have turned out — or the first half at least, wouldn’t have turned out a lot better for Germany.

Edward Luttwak: No, I would say that if Germany had not gone to war in 1914, given the fact that it was more advanced in the chemical industry, metallurgical industry, and had competed with the United States only for the electrical industry, dominated the pharmaceutical industry. Deutsche Bank was the largest bank in the world, the most powerful bank in the world in every possible way. Given the fact that German education had advanced so far beyond anybody else, it wasn’t just universities, you understand, it was a high school. The German Hochschule, which just means high school, was a formidable institution.

If they decided not to go to war in 1914, then Europe would have been compromised in other ways, because Germany would be absolutely the dominant country. That would not be a problem. When I was born, German was the dominant language, even though it was ruled by Romania. All the books were in German.

The fact is, Germany dominated from the pharmaceutical industry to education, to every damn other industry, to the university. Also, the domination was self-enforcing, because the best and brightest would go to German universities. The people of the Manhattan Project were all Hungarian Jews and Polish Jews, whatever they were.

Jordan Schneider: Oppenheimer, famously, of course.

Edward Luttwak: But Oppenheimer was born in America. All these people, most of them were not. They were born all over Europe.

Jordan Schneider: He went to study in Bonn.

Edward Luttwak: Of course, he went to study in Germany, and they went to Germany. The Hungarian bunch were beneficiaries of highly superior secondary education and mathematics teaching in high schools, and Hungary was the world leader in every respect. Russians today, by the way, the Russians, with all the decline of Russia and all the fuck-ups and screw-ups and all the problems they have, even today, Russian high school teachers, mathematicians are superior in their education.

Germany would have been the dominant power. All they had to do was not challenge the Royal Navy, because German commerce worldwide was protected by the Royal Navy. The Royal Navy protected German commerce as German commerce was becoming more and more dominant all over the place. From coffee plantations in Southern Mexico, in Guatemala, to every damn thing you wanted, and traveling the world’s oceans protected free of charge by the Royal Navy. That’s when they decided to challenge the Royal Navy.

In case a comparison comes to mind, the Chinese wanted to challenge the US Navy, which enables them to sell all over the world. Who would do that? Insanity.

Jordan Schneider: This is what I want to bring it back to the Greek tragedy, because you have these two countries, Germany, which is doing everything well. All the trend lines look really great. Then, China in the 1980s, 1990s, and 2000s, is really firing on all cylinders. You have this incredible integration with the global economy. Is there something just about humanity where, when you see power, you have to take it all the way?

Edward Luttwak: One can go beyond that. One can go into a more logical sequence. The wonders of free economies, commerce, the wonders of science and the industry it brings, all of it is just really wonderful, but it’s all based on different kinds of freedoms. Those freedoms are conceded by a state. You have a state that maintains law and order, protects the borders, but it’s a state whose politics, whose matters, whose leaders limit their accumulation of power. They allow you freedom to operate sufficiently so that the economy can flourish and academic universities can flourish.

Then, what happens is that they still have the quest for power, they still have the craving for power, but they manifest it, not by imposing themselves on their own citizens, but they manifest it, for example, in colonial competition or something at the turn of the century or something of the sort.

The problem was that the Germans dominated Europe militarily, but they could not expand militarily. As Bismarck had explained, Germany, with his wonderful army and everything else, had reached the culminating point of success in 1871 when they formed the German Empire. Bismarck understood that if Germany expanded by another square meter, it would start a process of global coalition against Germany and to stop it.

He was blessed by the fact that von Moltke, his chief of imperial staff, fully understood strategy. As soon as Bismarck formed the German Empire in 1871, he was greatly applauded. A week later, people started saying, “Well, the Italians are unifying Italy. All the Italians are coming under the Italian flag. We have Germans in Silesia that are Germans, but then we have Germans there, and we have Germans in Transylvania, as it happens. Mainly, we have the Germans in the south in the Austrian Empire. Now, the Italians have unified, the French have unified. Why the hell can’t we unify?”

Bismarck basically said words to the effect that, “We have reached the maximum culminating point of success. In our lifetime, in the lifetime of our children, Germany cannot expand by one inch. If we expand by one inch, everybody else will gang up against us. Everybody will gang up against us.” He might have said, “Even the Americans,” or something. He understood there is a culminating point of success. Going beyond that doesn’t make you most successful, but you descend the curve of success.

As I say, his luck was von Moltke, the chief of the general staff. It was intellectuals, naturally, professors and so on, who said, “We have the most powerful army in Europe. We have unredeemed Germany, because we have all these Germans who are not in Germany. Everybody else is unifying, the Danes, the Italians, the damned Portuguese. Only we have Germans stranded outside Germany. So, we have to use our power to unify Germany like everybody else. Are we racially inferior that we can’t be unified?” These were very strong arguments. They were not advanced by hotheads in pubs. They were advanced by university professors.

The first place they wanted him to expand was, of course South to Austria and so on. In the Balkans, with the excuse of the Balkans, the Balkans are in turmoil, and he comes up, he says, “All of the Balkans are not worth the bones of one of my grenadiers,” and so on.

He had this very clever guy, von Moltke, the chief of the general staff, who not only understood tactics and operations. He was the one who really understood how to operate the railways. He also understood that tactical victories are worthless. You need operational victories, all these things. He was not a man who wrote books, but he clearly understood all that from his single decisions that he was making like that. He backed him firmly.

The moment that von Moltke is gone, Bismarck is still held up until the young Kaiser comes. The young Kaiser says, “We have to use our power to unify Germany. It’s our duty. We left our fellow citizens stranded. We are sailing in a ship, and we’re leaving them on the shore.”

Then, the intellectuals weighed in. The German tragedy would not have been possible if all the intellectuals had not lined up in support of the idea of building a fleet to challenge Britain. Britain was assuring the commerce of Germany all over the world through the Royal Navy.

What happened is that the British reacted, and they resolved all the quarrels they had with the French. They made 72 concessions and 72 colonial disputes. They satisfied everybody so that the next thing Germany turns around, they find themselves surrounded by two world empires against them.

In the case of China, Xi Jinping is particularly inexcusable and shows his intellectual nullity. For all his pretensions that he knows literature, I trust him that he really is very interested in literature. I’ll give you a small proof of it. Goethe wrote three or four or five times more than Shakespeare. Therefore, there’s no complete Goethe in English. There’s no complete Goethe in French. There is in Chinese. Under Xi Jinping’s order, the Shanghai Foreign Languages University had to mobilize all 85 Chinese Germanists to bring all of Goethe in translation in 87 volumes. It doesn’t exist in English.

I believe he understands literature and loves literature, Xi Jinping. But clearly, he has no understanding of history, because Chinese commerce is carried by the US Navy. The US Navy protects Chinese commerce. For them to oppose the US Navy is the same level of high-grade idiocy.

That’s exactly what Xi Jinping says in China, “We have to challenge the US Navy, because if we don’t, one day, they will suddenly shut down everything.” This is not an ordinary error — I made mistakes. I made them because I’m stupid various times. I made a mistake yesterday. I made a little mistake because of some foolish calculations. You need intellectuals for this. To make that level of error that Germany made in challenging the Royal Navy, beginning the whole competition, causing the British to start organizing a coalition against them — for that you need the intellectuals.

Jordan Schneider: You have this action and reaction, which you saw in Germany and you’re seeing now in China today, where the rising power gets ahead of its skis. All of a sudden, the entire region recognizes the fact and reshapes itself to make sure that power isn’t able to manifest its mission. We have that, but we also have these moments in history where you get leaders who have this sense of temporal claustrophobia, of, “Whatever odds I have today, they’re going to be worse tomorrow.” Then, you have horrible wars start.

Edward Luttwak: There’s also protagonism. Hitler started the war in September 1939 because his health wasn’t great, and he was afraid that he might decline before Germany could fight this necessary war. There were plans to start the war in 1942. He missed out on three years of production or something.

Xi Jinping undoubtedly has this belief that he must rejuvenate China. Paradoxically, China is shrinking and getting older by the minute, because they don’t have babies, but he wants to rejuvenate, and he rejuvenates by fighting and so on. Then, intellectuals provide the rationale that we have to attack the US Navy, because even though our commerce has gone global by the protection of the US Navy, undoubtedly the Americans will not let us really come out on top, so they will abruptly shut down Chinese commerce unless we have defeated, we are in a position to overcome their navy and all that. For that, you need intellectuals.

You need intellectuals to concoct these elaborate explanations of why Germany has to attack the Royal Navy, which was providing the security for its global commerce that was essential to German life, and its growth and so on.

Whenever you see the Chinese navy’s development, and you hear what Xi Jinping says when he visits — the last speech I studied in detail was his visit to the Eastern Theatre Command, it’s the command that has Taiwan, and says, “Most important thing, you have to be ready for war. The most important thing, you have to be ready for war and victory. You have to be ready for war, and I mean real war. You have to be ready for real war and then win a victory.”

He is exhorting them. Exhorting them. Historically, the Chinese never fought. The Chinese were conquered by foreigners. The last foreign dynasty was the Japanese. If the Americans had not defeated Japan in 1945, the Japanese very likely would still be in Beijing, Shanghai and Guangzhou, with the nationalists and the Japanese and the communists fighting it out or whatever it is, backed by one or the other.

To make these mistakes, you need intellectuals. Intellectuals mediate. Then, you need the guy who’s afraid that he will die, because his successors are unworthy and only he can achieve this thing. That sets up the timing.

The Chinese are a profoundly unmilitary nation. Profoundly unmilitary. They are not really fighters at all. Therefore, in 1895, a very big Chinese navy with modern German warships was defeated by a small Japanese navy. The Japanese are fighters. The Japanese come from a culture of fighters, but the Chinese do not.

A Childhood Interest in War

Jordan Schneider: Let’s talk about your approach to history. Because in reading, ingesting a lot of you over the past month or so, you do have this very unique approach, which is almost like an everything-everywhere-all-at-once view, both when you’re doing your Byzantine stuff as well as the more contemporary work looking at the modern world, which is not something you see very often.

I guess there aren’t a lot of historians who are fluent in as many eras and regions as you are, or even try to synthesize as much and draw from as many different examples in trying to pull out threads and a thesis. Maybe, how did you come to this approach? What inspired it? How did you develop this style?

Edward Luttwak: Well, if I were to answer honestly, you would realize that I invented none of it. I can’t claim credit for having initiated anyway. Accidents of life brought me successfully into contact with people of all kinds.

It started with the fact that I was born in Transylvania, in Banat, actually, Northwest Romania, which is an area that was within Romania, but was not Romanian. The population included Serbs, there were Hungarians, there were Germans, Catholics, German Protestants, there were Hungarian Calvinists, Hungarian Catholics, Jews of different kinds, and of course, Romanians as well. It was the only truly multinational part of Europe, the only multinational place in the whole of Europe.

Down the main boulevard where the house where I was born was, there was the Serbian Cathedral, the Orthodox Jesuit, Romanians, the Hungarian Catholic Church, the Calvinist Church, the German Lutheran and so on. There were schools for all these languages, and people conversed in them. It was truly multinational. The Romanian government had a very light hand because it was by far the most prosperous part of Romania, which generated all the high tax revenues, and they didn’t want to mess with it. They didn’t fly to Romania — There was no brutal imposition of Romanian uniformity, of anything of the sort.

I was born in that environment. My parents were very enterprising people. They honeymooned in 1938, and they went to Bali, because the KLM had just started flying boat service to Surabaya, which is across from Bali. The Americans had made a film about Bali Ha’i [Ed: the musical South Pacific].

There were no hotels in Bali, but it was a very fantastic place. All the women went around topless in those days, because it was a traditional Hindu way to do it.

My father’s business was import-export. Not anything modern, but he imported dried fruits from Turkey and black olives from Greece, anchovies from Catania, oranges from Palermo, all the traditional things. He was traveling all the time, so it was very international.

Because of that, he took us out of Romania a week before the communists slammed down.

Jordan Schneider: What was their experience of the war?

Edward Luttwak: Well, the experience of the war was that — I don’t want to go into details, but the fact is that the only two Jewish communities in all of Europe where nobody was deported, and nobody was killed. Those were in Arad and Timișoara — the Banat communities. There, the population increased during the war, from the Atlantic to the Urals, all other communities either disappeared or went down drastically 10%, 5%, 3%, but there they increased.

You’ll notice that if you look for it in the vast stereography of the Holocaust, you will not find the history, because even when the Holocaust Museum, archivists, whatever they are, historians, did a big thing on Romanian Jewry, it was all about martyrology. They died here. They died there. But for the place where Jews survived, historians didn’t write anything about it. They were not interested. The leadership of the Jews in these two areas acted as if the leaders of a nation under attack and deployed the resources, did everything and used every method. In other words, it was a survival that was not accidental. It’s interesting that these stereographers are not interested in it.

From leaving everything behind, and there was a lot to be left behind, my father, my mother, a lot, they went to Italy with nothing. My father immediately went to Palermo, Sicily, where his few thousand dollars became millions in three years, simply because he read the Swiss newspaper, Neue Zürcher Zeitung, every day. Zürich is the headquarters of the reinsurance industry. There are people sitting in Zürich who are very interested in oil wells after the coast of Mexico. There were detailed articles and notes about everything, including the British National Health Service, which he read and which promised to give oranges to every British child.

My father, who had been to England and knew there was not a single orange tree, went to Palermo with the highest concentration of orange trees and started sending oranges to England. Arriving with three children and virtually no money, within three years, he started building a factory in Italy, because he had a perverse passion for plastics, which were new at the time.

Anyway, I went to school in Palermo. In Palermo, the teacher taught us Latin instead of Italian. Then, I went to a British boarding school. In those days, Latin and Greek were still very important in British education. Another thing they had was a cadet corps. Britain still had an empire, and it would have for another 20 years or so. In the boarding school, you have a cadet corps. At the age of 13, you have a kid’s uniform, and you have, what you call, .22, a light rifle to practice with. Then, a couple of years later, you get a real rifle, and so on.

Jordan Schneider: Let’s stay there for a second with this world you were living in. What was everyone’s relationship to the Holocaust and Judaism?

Edward Luttwak: My parents were invited to participate in Holocaust. They never did and continued to have absolutely no interest in it.

Jordan Schneider: What does “participate in the Holocaust” mean?

Edward Luttwak: Well, you were invited to go and be deported. People like my parents, they persuaded the entire community to simply refuse.

Jordan Schneider: During the war?

Edward Luttwak: During the war. They did not participate in the Holocaust. They considered the Holocaust as a defeat of the Jewish leadership, secular and religious. All these self-important people who were the leaders of the Jewish community around Europe, from the Atlantic to Russia — they all failed. They failed to understand that there was a threat. They failed to organize, they failed to use the resources. They failed to do a lot of things.

A local rich guy, really rich guy, was a man called Neumann, actually, Baron Neumann, no less. He called the young people, including my father, and said, “I’m very rich, and none of my money will serve me if I’m deported. You young fellows, if you have any way of doing anything useful and have a high probability, I’ll fund it. If it has a low probability, I will also fund it. If it is just a possibility that it might be of any use, I will fund it.” That was one thing, using money like that.

The other was the understanding that when there’s a war, you have to be ruthless. There were ruthless actions taken that were effective. Afterwards, my parents never, ever mentioned it. I never heard a word about it, nor did they ever talk about what they left behind.

I actually visited the house when I got an honorary degree in my hometown, Arad. If I’d owned that house, I would have boasted about it, because it was made of marble from Italy and all kinds of things. They never, ever mentioned the Holocaust. They never mentioned everything they left behind. They were strictly forward-looking. They were not unique in this, because actually, a lot of even Holocaust survivors, who went through concentration camps, were very dynamic people, actually, after the war. Very dynamic. Some of them became car dealers in California and things like that. Others went to Israel and created a state, of course.

My good life were schools. My elementary school in Palermo, because all the rich families sent their children to Tuscany so they would not speak Sicilian. They would not be contaminated by speaking the local Sicilian. My parents were enthusiastic about Sicily. I went to the school, where I did not learn Italian, but I learned Sicilian and Latin.

Then, I go to boarding school, where my teachers are refugee professors from German universities. Alongside the Thames River with a six-foot rabbi who believes in physical athletics. He was a really athletic guy, and he really believed in mens sana in corpore sano. We did all the sports very seriously.

The cadet corps was wonderful because the teachers were sergeants. All of the sergeants had been through World War II, because we’re now in the early 1950s. Actually, in our case, it was the Oxfordshire and Buckinghamshire Light Infantry. They had all been in the Eighth Army. They went from North Africa, Italy, and so on. When they were teaching us how to use weapons, they had real knowledge.

Also, Britain still had an empire. Everybody in that school was looking forward to having a career in imperial policing and so on. Along the way, you do your years in uniform, and then you do whatever you want to do. That applied even to Jewish kids or the sons of dentists who wanted to be dentists. They didn’t want to be dentists without doing not just a national service, four or five years, that kind of stuff.

These were all things that I can claim no credit for at all. It was accidental. It was my parents who brought me to Sicily, and therefore I learned Sicilian, and therefore I learned many, many things, including the art of violence, controlled violence. Even as very young children in Sicily, you could never escalate fights, because if you won the fight over the other 8-year-old, the 10-year-old would come, the brother. Then, another brother, and then the parents would come out, then guns would come out.

You learned, actually, the coherent use of force, which is very typical of the culture, which is the mafia culture, really, is that you don’t waste force. If you go around punching people for no reason, this is really terrible. All these other stuff were all giving to me without any credit on my own, any merit on my own. It was what you might call an extraordinarily fortunate childhood for somebody whose final destination was not to paint, or make films, or build houses, but to do what I have done, which is to study war and all these other things. I was given all this right at the start.

Jordan Schneider: Why should people study war?

Edward Luttwak: Well, the reason I studied war is that I was coming from a World War II family, let’s call it that, arriving in Sicily, where the controlled use of violence was the essence of society — the Italian state pretended to rule Sicily. As a matter of fact, they still pretend to rule Sicily today.

Sicily was actually ruled by the mafia. The mafia is not the mafia of the films and so on. The heads of the mafia were lawyers, notaries, dentists, surgeons, and people like that. Yes, it was something. Then, I was very determined to take part in any war I could take part in, because I did not want to miss the experience of war.

I read Churchill’s book, The River War. He was very poorly educated. He never really studied at university or anything of the sort, but he was a young subaltern, a young officer in the war against the Mahdi in Sudan. He was a cavalry officer. He wrote The River War, which was a book about his experiences. He took part in the charge of the Battle of Omdurman, which is really just about the last charge of cavalry with swords drawn. He published his book in London very soon after, which was immediately reviewed by the people.

The first people who read the book had taken part in the war against the Mahdi in Anglo-Egyptian Sudan. In other words, he had to tell the truth because the book that appeared was read immediately by the other officers.

He, in that book, already revealed an understanding of the basic dynamics of war, which would enable him to be a pioneer. For example, Churchill understood that to advance against machine gun fire, you should carry a plate of steel, and it’s not convenient to carry it in your hands. It’s heavy. You need to have a vehicle — the tank. He’s the one who understood that you cannot outpace the rate of fire of a machine gun.

When radar came along, he understood that radar should be used to have a defense perimeter. The Germans never understood that. The Germans used radars for individual dual engagements. He understood the most important thing is to have a perimeter so that you know where they’re coming, so you can make a rational use of your own fighters and not spread them around.

Then, and this is important, when the nuclear weapon comes along, because some refugee mathematicians contradict the prevailing opinion that fission bombs are impossible, which was uniformly held by the leader of the profession in the United States, Enrico Fermi, who believed the bomb was impossible. Joliot-Curie in France, son of Marie Curie, believed it was impossible. Eisenberg in Germany believed it was impossible.

The dissenting people were a bunch of refugee scientists, three Hungarians who were in the United States, Teller, Wigner, and Szilárd, all products of the same school room, the class in Budapest. The legend is that these three guys went to Einstein. Einstein wrote a letter to Roosevelt. Hey, presto, Manhattan Project. The letter was put in a safe.

The actual way it started was in England, because Churchill was the chairman of the radar committee, so to speak. Every physicist had access to him. Every professor. The two guys who did the same calculations as Wigner did, Teller and Szilárd, they reached Professor Oldfield, who was an Australian at Birmingham University — he went to Churchill. Churchill is the one who actually initiated.

The same guy who never finished school, who never went to secondary school, charged Omdurman with a sword in his hand, is the guy who made the tank, and then made radar and then made nuclear weapons. Why? Because he understood something. He really had this sense for the realities of these things.

As I say, I became interested in war at a fairly young age.

This was a deep interest in war, and also always actually a technology interest. My last book is all about technology, but always interesting technology of war. Now, Churchill did it all by innate talent of some mysterious kind. He was not well educated. On the other hand, I didn’t have to do that. I was well educated. I had wonderful schools.

[The June 1967 War] was the first time that I was in combat. I discovered that a lot of things that I thought about combat were wrong — for example, that you have to be brave. You don’t have to be brave. You don’t. I was never in a cavalry charge like Churchill was, who gets on a horse and charges against the enemy who was shooting at you.

I didn’t go up to the Golan Heights. I wasn’t first echelon. I was just a rear guard. The only thing I had to do was to repel attacks. There were a couple of Syrian attacks, nothing very elaborate. A few tanks with some infantrymen working alongside them, very old-fashioned, minimal. You shoot at them. I didn’t see anybody being afraid. I wasn’t afraid. That was my first introduction to it.

Actually, the Six-Day War, everything was wonderful about it, except that it ended very quickly, just when you were really enjoying it. The ‘73 war was better. I was a volunteer for that one as well.

The Iliad and Revolutions in Military Affairs

Jordan Schneider: You mentioned your interest in the interaction between technological change and warfare. Could you pick a few examples from history, and explain how they illustrate the dynamics, how technology ends up changing the way it happened?

Edward Luttwak: Small arms, as you know, arrive as arquebuses, with a very low rate of fire and then they get better rate of fire. Then right through, as Europe evolves and modernizes, you have soldiers that are regimented — they advance in files and lines. They have to advance against artillery, they have to advance against muskets and so on. Then, a whole culture of uniforms, of martial music, band music, a whole culture of bravery against fire is what enables war to continue once firearms arrive.

Jordan Schneider: Right, because if not, who would do this?

Edward Luttwak: When the firearms arrived in Japan — and they arrived and very quickly and were used very well — the response of this society was to stop war and to have the shogunate that suppressed all war. The samurai culture continued, but it was devoid of actual consummation, so to speak, because the shogun stopped the war. Why? Because the Japanese social structure could not survive the firearms.

In Europe, they didn’t stop war. Indeed, social structure continued to be smashed by firearms. Finally, we reached the invention by the very important American Hiram Maxim [the automatic machine gun]. Suddenly, by being able to fire 550 rounds per minute of belts of 50 rounds, the entire culture of Europe — or the war culture of infantrymen, drilled and disciplined to advance against fire, that is, against the peppering of muskets — becomes irrelevant.

Of course, they tried at the beginning of the First World War. The massacres take place in battle — 10,000 dead here, 20,000 dead there — to achieve no advance of ten yards or something. Technology intervenes in war, incrementally and invisibly, changing nothing.

Then, suddenly, technology intervenes and changes everything. It ended the possibility of the cavalry charge. Cavalry gets swept off the battlefield.

Finally, there is technology, the tank. If the machine gun fired small arms ammunition and a piece of steel stops it, and now you find a way of bringing the steel forward, because somebody else, unrelatedly before the war, had invented the agricultural tractor with tracts and an engine to be able to pull plows in thick terrain.

Technology arrives abruptly to take you out of a bind, in effect. The First World War would have been a complete stalemate were it not for the tank. The tank broke the stalemate. A single invention. Technology intervenes abruptly. When it does, the ability to change everything, to make the strong weak and the weak strong.

Jordan Schneider: What books come to mind that illustrate the interaction between technology and warfare?

Edward Luttwak: The poet, Robert Graves, wrote his memoirs, Goodbye to All That, where he gives a detailed description of fighting in the First World War, and I learned enormously. The poet, Robert Graves, had the poetical education from a young age. He was conscripted for the First World War. All his friends, like Siegfried Sassoon, were all anti-war people, but quite a few of them were heroic fighters.

Graves, who came in as a second lieutenant because he was upper class, ended the war with no particular ambition. He ended the war as de facto brigade commander. He writes about the First World War, Goodbye to All That, in great detail with the perspicacity of a literary man, of a poet. A great poet, I think. I learned a lot from that book about the essence of a lot of war. He writes in detail. He writes about tactical things and how command works. I learned a lot from that book written by a poet. Not by a retired soldier.

Of all the books in this room — and this room is full of books — there are two books that are dominantly important from my understanding of war. One is the Iliad, and I have 10 different editions because people ask me to review them.

The other is the British official history of the strategic bombing offensive. The official book on the British strategic bombing offensive, by itself, is worth three-quarters of the books in this room put together. In the official history of the British bombing, what you get is the fact that war is actually a reaction. The British bombers were going through, and then the Germans would find a new tactic, which they would then figure out how to circumvent and so on.

The important part is when the Royal Air Force finally finds a way to actually fly to Germany and not to get shot down totally and to be able to find the targets. Originally, they didn’t even think about how to find targets, or to even locate the city.

Finally, the Royal Air Force was able to actually generate as many as 1,000 bombers to actually fly to a German city and destroy the core of it. The traditional German cities were built of wood. They learned how to produce aircraft rationally, as the Germans really never did, by focusing on one model and resisting the temptation to interrupt, to go to a slightly better model, to maintain rhythm and production. They learned how to train people to fly bombers. Each bomber took 7, 8, 9, 10, 11 crewmen and so on.

They come around to Churchill and say, “Look, we can destroy a German city every night that we bomb. We can bomb once every three or four days. If the British industry produces 1,000 bombers a month, we will be able to bomb all the German cities, and Germany will surrender.” They basically say, “Stand down the Royal Navy, forget about the army (which is doing nothing except in North Africa), give us all the resources and we can win the war by bombing.”

Churchill replies, “In war, everything is moving at the same time. You’re successful in bombing Germany. That’s why the Germans are going to pull more resources into anti-aircraft guns. They’re going to put more resources into radar. Right now, you’re winning the radar war. British countermeasures are defeating German radar. If you defeat German radar and you’re able to destroy German cities, the Germans will switch efforts, and everything moves at the same time, back and forth.”

Jordan Schneider: The chapters you did about the air war in Europe were the ones that unlocked it for me, because you really do see every level of war and the interaction between them, from the tactical stuff.

Edward Luttwak: Where did you read that? In The Logic of War & Peace?

Jordan Schneider: Yes. You get something tactically right — “Okay, if we find the four factories that make the ball bearings and we blow them up, then all of a sudden, they’re going to go back to donkeys.”

You just alluded to it right there. The success of it led to them adapting from an anti-aircraft perspective — they spread out the factories, and you end up changing the psychology of the whole regime. I’ve watched these really weird movies made in Nazi Germany in 1942, and they’re walking around on the street and going to the plays or whatever. Then, you’re in total war mode, because the city gets bombed, it’s much easier to get people to make the sacrifices they have to.

Edward Luttwak: I consider the Iliad as the foundation document of Western civilization, whose impact on life and society was only mildly moderated by the advent of Christianity and so on. The Iliad is about the essence of work. As I say, I read the Iliad 12 times, only for the purposes of writing reviews of new translations, which I was duty-bound to read the new translations. Some of them were awful.

My most important article ever is called “Homer, Inc.” It’s available free online. It’s a description of how the Iliad was written, how it was edited, why it has the power it has, and why all the Western countries are still very interested in it. There are multiple translations, and a new one comes out every two or three years.

In India, where the British set up classics departments in all the different universities, like Madras, Bombay, and so on, nobody knows Greek. Nobody’s interested. We couldn’t sell a copy of the Iliad for nothing. The Arab world absolutely rejects it. The only Iliad available is a very late and very bad translation. Where is their enthusiasm for the Iliad?

Japan has studied it, definitely from an early point, when they modernized, when they decided to go western, they were sensible enough to understand where it started from. They didn’t try to jump into petroleum engineering without starting with Homer.

The big place is China. The Chinese are enthusiastic about it. When I wrote this article, “Homer, Inc,” there were four different translations of the Iliad in China already. Since then, several more appeared. They’re not produced by some beautiful academy of ancient history or something. They are produced by commercial publishers out to make money, and the Chinese line up and buy them.

Jordan Schneider: It’s really remarkable how Western classics have such a foothold in China.

Edward Luttwak: You experienced that in China yourself. It’s a foothold, and it’s a serious one. My Byzantine book, which has been published in different languages, Greek, Turkish, Italian, French, and so on — Harvard Press itself did a beautiful edition, I have to say, a gorgeous edition with the Romano mosaic covers and all that. The most beautiful edition is the one published by the Communist Party of China, the so-called Academy of Social Sciences, which is actually the research bureau of the Communist Party Central Committee and Politburo in Beijing. It’s called the Academy of Social Sciences.

Their publication is magnificent, the most beautiful edition. I give them great credit because it came out years after my book called The Rise of China vs. the Logic of Strategy, which is the book that says that China will fail. Even though I published a book saying that the Chinese are wrong, they would fail, they don’t understand, they published the Byzantine book. It’s magnificent.

Before that, they did not know anything that it was against their system. I first visited China when Mao was still alive. I was there when he died. I was actually one of the honored guests at the funeral in 1976.

Who’s Who?

Jordan Schneider: I’m going to give you a contemporary leader, and I want to hear who you think is the analogous person from history, either ancient or modern, that first comes to mind. First — Trump.

Edward Luttwak: Oh, well, Trump is Cleon. Pericles had a rival in the Greek assembly, Cleon, who was a vulgar guy with a very, very powerful voice. He thundered. Pericles didn’t have his volume. He would always attack Pericles because of things like his mistress and things like that. Pericles would try to explain to the assembly the politics of the war, the necessity of the war, the strategic context, and how we must act in this and that. Cleon would come with a simple, “Let’s go and kill all of those guys there.”

Trump is Cleon. He is the populist with a loud voice, plausible arguments, as opposed to Pericles, who explains the reasons to the assembly and so on. Also, Cleon greatly increased the number of Greeks who served on juries, because they got the daily dough, a small amount, a small coin with which a couple of people could eat for a day or something.

Trump is Cleon, definitely Cleon.

Jordan Schneider: Netanyahu?

Edward Luttwak: Netanyahu would be Cincinnatus. Very much Cincinnatus. Netanyahu was at Boston Consulting Group (BCG) with his pal, Mitt Romney. Romney begged him to wait a couple of years, and then you become a millionaire, and then you can go back to Israel and plunge into Israeli politics, trying to do something.

Netanyahu actually consulted me, came to this house, sat on my deck, wanting to be prime minister. I said, “Look, you’re a great television celebrity,” because he had been defending Israel at the UN. He was on television all the time. “Go back to Israel. All the politicians will wait to eat you up and devour you. You go back, ignore them in Tel Aviv, and get a little car and go and visit all the branches of the Likud party.”

The branches are in the back of a gas station. There will be a few old guys showing up. That’s the branch. “Patiently go from north in Betula to a lot in the south and talk to them, and they will all have met the television celebrity, Netanyahu.”

“Then, after you visited all the branches in every little place, then wait for the party meeting, the annual meeting, and all these people who have met you, all of them had told all their friends that you’re actually their friend, how Bibi told me this, I said to them that, and so on and so forth,” and he won. Instead of being eaten alive by the other established politicians, he was there.

By that point in time, before going to the United States, going to MIT, going to BCG, he had served five years in the army. The military service at the time was actually two and a half years. He served for five years because he signed up for an elite unit. Because of that, he was in combat even between wars. Every other month, he got wounded. Then, he goes to MIT to study business and so on. He’s about to start making big money, then he leaves it to plunge into politics.

He’s Cincinnatus. He has many other things, because remaining in power, people degenerate, obviously. He is not the Netanyahu that first ventured, courageously and cleverly, actually, because many other people had tried to do what he did, to go from international celebrity to becoming an important politician, but he succeeded.

Then, just by staying in power, you degenerate, your mind becomes blunter, and you outlive your talent by staying in power. He is, to me, a Cincinnatus.

Jordan Schneider: What about Xi?

Edward Luttwak: Xi? Well, the easiest explanation is Stockholm syndrome. When Xi came to power, Mao had been sidelined. The portrait remained in Tiananmen, but Mao was out. Mao had killed 60 million Chinese with his harebrained schemes and his madness and his cruelty. He had killed all his colleagues in the party.

He killed Liu Shaoqi, whom I met when I was a very young person in Romania in 1964. I was invited to dinner because I was with the television team, interviewing the president of Romania, the boss. He had Mikoyan and Liu Shaoqi, because Romania was independent or something. I met Liu Shaoqi at a long evening dinner. When Liu Shaoqi complained about the Great Leap Forward and the murder of all these people, he ended up in prison. The Red Guards put him in prison without insulin, and he died there. Mao, to me, was a maniacal character.

Xi Jinping is a total victim of Mao, because he was living in Zhongnanhai in a mansion in the heart of Beijing with his father, who was supposedly Zhou Enlai’s deputy. In reality, he was the party’s publisher. He published books and journals for the party. He had published a book about a character, long forgotten at the time, who had quarreled with Mao. When he published a biography of this great communist leader, Mao didn’t like it.

Mao sent him away. He wasn’t shot, he wasn’t killed. He was exiled. He was sent to prison. Xi Jinping, along with his two half-sisters, gets tossed out of their beautiful mansion. He and his mother are all crowded in one room in some horrible apartment house while the father is in prison.

Periodically, he’s brought back to Beijing to walk through the streets with a placard saying he’s a counterrevolutionary, da-da-da, so people could pummel him and beat him. The mother had to go along with him in these things. One of his half-sisters died of hunger or committed suicide. It is not clear. The other half-sister, who then bought a mansion in Hong Kong decades later for maybe $150 million, was set to work making bricks with their bare hands, mud bricks to be baked for five years. Only survived because the communist party leader from Mongolia, who was called the King of Mongolia, kind of thing, he was very high-handed, and he periodically would send somebody to bring the food.

He is sent to the countryside, as everybody knows, in a house with no windows, dug into a mountainside, in a horrible place in Shanxi. A really horrible, treeless hills, an ugly village, primitive, dirty, with very little to eat. He, who had grown up in a house full of books because his father was the party publisher, had only one book with him, a translation of Goethe’s The Sorrows of Young Werther, which he quickly changed for Faust, which is very appropriate.

He read the Chinese translation of Faust, written, by the way, by Faust, translated by a Faustian character, whom I actually met, whose name was Guo Moruo (郭沫若). Guo Moruo had survived the Cultural Revolution because when the railroads came, he had already written a screed saying that everything in Britain was counterrevolutionary. They couldn’t force him to apologize for anything, because he apologized himself. Also, because the Red Guards grabbed his two sons, and he enthusiastically joined in accusing them of being counterrevolutionaries, both of them were killed.

When I met him, because he had shown such loyalty to Mao, he was restored to his elegant mansion, but there was some servant lurking in the back, and he had this vase that he was very proud of, antiques and so on.

He reads Faust in a village only in daylight. There was no electricity to read at night. He suffered because of Mao terribly, most terribly for 18 years. He ought to hate, hate, hate Mao, but it’s Stockholm syndrome. Instead of hating Mao, he adores Mao, and he keeps exhorting Chinese people to read this Mao thing about that he wrote in the caves of Yan’an about protracted war, and this and that. He elevates the cult of Mao. This is Stockholm syndrome.

The man is sick, deeply sick to celebrate, the person who imprisoned his father, humiliated his father, repeatedly. His mother used to walk alongside the father with a placard, and people would call her names and everything else, push her, shove her. She would fall to the ground. She’d pick herself up. She got up again. Otherwise, people would have walked over and killed her.

For him to worship Mao is deeply sick, but it is the so-called Stockholm syndrome. You want to propitiate this character. It’s a tragic thing that China is in the hands of somebody who has a historical neurosis.

Jordan Schneider: Let’s do Biden briefly.

Jordan Schneider: I’ve known Biden. You’re talking now about somebody I know quite well. If you go online and you put my name and his name, you’ll see that he many times invited me to testify before the Senate Foreign Relations Committee.

I met him when he was just elected, just before he lost his wife and child in the car accident. He was incredibly young, and incredibly friendly and everything else you want. But we lost touch until he became Chairman of the Senate Foreign Relations Committee. Then, he calls me and he says, “I remember you. Tip O’Neill introduced us.” He had me testify to various things. Some of this testimony is on C-SPAN.

I know him well. I have lost a lot of my short-term memory. He has lost a lot more than I have. The one thing he has — he understands foreign policy. He understands foreign policy really well. The problem is that there are no Bidenites. All the Bidenites are retired or dead. The people who staff him are Obama people, who are deeply unsympathetic to Biden’s fundamental ideas.

I visited Saudi Arabia just six days before his arrival in Jeddah to meet the various princes, including the prince, Mohammed bin Salman. I asked the foreign minister. The foreign minister received me, and we had a long talk. I said to him, “What is the agenda? Where is the agenda of the meeting? Who does what?” and so on. “No agenda.” The White House staff — these Obama people, disloyal to the last minute — were trying to sabotage the visit because they wanted him to punch Mohammed bin Salman and not to greet him. They held up the agenda, the staff people.

The Biden you saw functioning in the world is a combination of Biden’s own ideas and everything else, but distorted and deformed by his people. For example, there was the case of Robert Malley, the fanatical opponent of Saudi Arabia and of Israel. Obama sicced him on Biden and forced him to have Malley as his Iran coordinator. The guy was in continuous touch with the Iranian regime under the table and got caught.

Biden with no Bidenites — it’s a tragedy, because Biden is always right. For example, I remember when he was vice president, everybody ignored him, ridiculed him. Ignored him, for sure, but also ridiculed him. Early on, the vice president says, “The Afghan army is not the real army, because the Afghan nation doesn’t exist. You could have Uzbek regiments and Tajik regiments, whatever, but you can’t have an Afghan army.” You get all these briefings by people like Petraeus and so on and says, “It’s a put-up job. They’re just doing it for the salary. They will never fight, because you can’t have an army without a nation and there’s no nation.”

He was totally right. He was ignored. The people who ignored him, sneered at him, and made fun of him at Georgetown dinner parties went on to serve in his administration, because there’s nobody else. The Democrats don’t have other people.

This show’s guest is the legendary strategist Edward Luttwak — the Machiavelli of Maryland. He’s consulted for presidents, prime ministers, and secretaries of defense, and authored magnificent books on Byzantine history, a guide to planning a successful coup, and an opus on the logic of strategy and the rise of China. He raises cows, too.

This is the full-length transcript of our conversation.

Our conversation today covers…

• Luttwak’s childhood and formative encounters with war, including an early fascination with the mafia in Sicily,

• Technological step-changes in warfare,

• Books that shaped Luttwak’s view of war, from Clausewitz to the Iliad,

• The costs of “removing war from Europe” post-1945,

• China’s strategic missteps,

• The psychology of deterrence, including what kind of Middle East policy would actually deter Iran,

• The strengths of democracies vs. autocracies.

Listen now on your favorite podcast app. Note, we recorded this in the summer of 2024.

A Childhood Interest in War

Jordan Schneider: Let’s talk about your approach to history. Because in reading, ingesting a lot of you over the past month or so, you have this very unique approach, which is almost like an everything-everywhere-all-at-once view, both when you’re doing your Byzantine stuff as well as the more contemporary work looking at the modern world, which is not something you see very often.

I guess there aren’t a lot of historians who are fluent in as many eras and regions as you are, or even try to synthesize as much and draw from as many different examples in trying to pull out threads and a thesis. Maybe, how did you come to this approach? What inspired it? How did you develop this style?

Edward Luttwak: Well, if I were to answer honestly, you would realize that I invented none of it. I can’t claim credit for having initiated anyway. Accidents of life brought me successfully into contact with people of all kinds.

It started with the fact that I was born in Transylvania, in Banat, actually, Northwest Romania, which is an area that was within Romania, but was not Romanian. The population included Serbs, there were Hungarians, there were Germans, Catholics, German Protestants, there were Hungarian Calvinists, Hungarian Catholics, Jews of different kinds, and of course, Romanians as well. It was the only truly multinational part of Europe, the only multinational place in the whole of Europe.

Down the main boulevard where the house where I was born was, there was the Serbian Cathedral, the Orthodox Jesuit, Romanians, the Hungarian Catholic Church, the Calvinist Church, the German Lutheran and so on. There were schools for all these languages, and people conversed in them. It was truly multinational. The Romanian government had a very light hand because it was by far the most prosperous part of Romania, which generated all the high tax revenues, and they didn’t want to mess with it. They didn’t fly to Romania — There was no brutal imposition of Romanian uniformity, of anything of the sort.

I was born in that environment. My parents were very enterprising people. They honeymooned in 1938, and they went to Bali, because the KLM had just started flying boat service to Surabaya, which is across from Bali. The Americans had made a film about Bali Ha’i [Ed: the musical South Pacific].

There were no hotels in Bali, but it was a very fantastic place. All the women went around topless in those days, because it was a traditional Hindu way to do it.

My father’s business was import-export. Not anything modern, but he imported dried fruits from Turkey and black olives from Greece, anchovies from Catania, oranges from Palermo, all the traditional things. He was traveling all the time, so it was very international.

Because of that, he took us out of Romania a week before the communists slammed down.

Jordan Schneider: What was their experience of the war?

Edward Luttwak: Well, the experience of the war was that — I don’t want to go into details, but the fact is that the only two Jewish communities in all of Europe where nobody was deported, and nobody was killed. Those were in Arad and Timișoara — the Banat communities. There, the population increased during the war, from the Atlantic to the Urals, all other communities either disappeared or went down drastically 10%, 5%, 3%, but there they increased.

You’ll notice that if you look for it in the vast stereography of the Holocaust, you will not find the history, because even when the Holocaust Museum, archivists, whatever they are, historians, did a big thing on Romanian Jewry, it was all about martyrology. They died here. They died there. But for the place where Jews survived, historians didn’t write anything about it. They were not interested. The leadership of the Jews in these two areas acted as if the leaders of a nation under attack and deployed the resources, did everything and used every method. In other words, it was a survival that was not accidental. It’s interesting that these stereographers are not interested in it.

From leaving everything behind, and there was a lot to be left behind, my father, my mother, a lot, they went to Italy with nothing. My father immediately went to Palermo, Sicily, where his few thousand dollars became millions in three years, simply because he read the Swiss newspaper, Neue Zürcher Zeitung, every day. Zürich is the headquarters of the reinsurance industry. There are people sitting in Zürich who are very interested in oil wells after the coast of Mexico. There were detailed articles and notes about everything, including the British National Health Service, which he read and which promised to give oranges to every British child.

My father, who had been to England and knew there was not a single orange tree, went to Palermo with the highest concentration of orange trees and started sending oranges to England. Arriving with three children and virtually no money, within three years, he started building a factory in Italy, because he had a perverse passion for plastics, which were new at the time.

Anyway, I went to school in Palermo. My history really starts there, because the local schoolteacher refused to teach Italian. I didn’t know Italian. I go to school, I had to learn Italian. He refused to teach Italian. He said, “Nobody speaks Italian here. Everybody speaks Sicilian. What’s the point of me teaching you Italian?” He taught Latin. He himself had been trained as a Latin teacher. Couldn’t get a job as a Latin teacher. Got a job as an Italian teacher, but with total indiscipline, and nobody stopped him, he just taught us Latin.

I was there only for elementary school, and I was there for only four years. Then, I went to a British boarding school. In those days, Latin and Greek were still very important in British education.

Another thing they had was a cadet corps. Britain still had an empire, and it would have for another 20 years or so. In the boarding school, you have a cadet corps. At the age of 13, you have a kid’s uniform, and you have, what you call, .22, a light rifle to practice with. Then, a couple of years later, you get a real rifle, and so on.

Going to boarding school and starting on Greek there, Latin and Greek rifles for that corps and so on. The boarding school was a Jewish school.

Jordan Schneider: Oh, interesting.

Edward Luttwak: Yes, but it was a Jewish school that derived directly from the Yeshiva of Lithuania. The Yeshiva in Lithuania, uniquely, was big on sports. In Lithuania alone, the orthodox Jews that you see running around and so on, they had sports. They had men’s salah, incorporate salah, healthy mind. Our rabbi was an athletic guy. We were on the Thames River, and used to swim up and down. We all did. We had boxing. We had cricket, of course, and football. We also had boxing and fencing as a big deal.

Cadet corps, boxing, fencing, swimming, not fretting and fussing, and cold showers and all that stuff of a British boarding school in the 1950s, that was a very profound thing. Also, our teachers were basically German-Jewish refugees who had been university professors. Our history teacher, whose name was Friedman, was a professor at the University of Bonn, the later federal capital, and so on. They brought that level of teaching.

They were not all Jews. The chemistry professor was an Englishman. There were a couple of non-Jewish teachers there who were very vigorous representatives, enthusiastic and so on. Of course, they were living an upper-middle-class life. Each of them, the boarding schools had a substantial house to live in and so on. The local farmers’ daughters would come in to help with the cleaning and so on.

They were the people who would teach things that would uphold the society, which had rewarded them with this upper-middle-class lifestyle in a beautiful place along the Thames. I didn’t know English — of course, I had to learn.

Jordan Schneider: Let’s stay there for a second with this world you were living in. What was everyone’s relationship to the Holocaust and Judaism?

Edward Luttwak: My parents were invited to participate in Holocaust. They never did and continued to have absolutely no interest in it.

Jordan Schneider: What does “participate in the Holocaust” mean?

Edward Luttwak: Well, you were invited to go and be deported. People like my parents, they persuaded the entire community to simply refuse.

Jordan Schneider: During the war?

Edward Luttwak: During the war. They did not participate in the Holocaust. They considered the Holocaust as a defeat of the Jewish leadership, secular and religious. All these self-important people who were the leaders of the Jewish community around Europe, from the Atlantic to Russia — they all failed. They failed to understand that there was a threat. They failed to organize, they failed to use the resources. They failed to do a lot of things.

A local rich guy, really rich guy, was a man called Neumann, actually, Baron Neumann, no less. He called the young people, including my father, and said, “I’m very rich, and none of my money will serve me if I’m deported. You young fellows, if you have any way of doing anything useful and have a high probability, I’ll fund it. If it has a low probability, I will also fund it. If it is just a possibility that it might be of any use, I will fund it.” That was one thing, using money like that.

The other was the understanding that when there’s a war, you have to be ruthless. There were ruthless actions taken that were effective. Afterwards, my parents never, ever mentioned it. I never heard a word about it, nor did they ever talk about what they left behind.

I actually visited the house when I got an honorary degree in my hometown, Arad. If I’d owned that house, I would have boasted about it, because it was made of marble from Italy and all kinds of things. They never, ever mentioned the Holocaust. They never mentioned everything they left behind. They were strictly forward-looking. They were not unique in this, because actually, a lot of even Holocaust survivors, who went through concentration camps, were very dynamic people, actually, after the war. Very dynamic. Some of them became car dealers in California and things like that. Others went to Israel and created a state, of course.

My good life were schools. My elementary school in Palermo, because all the rich families sent their children to Tuscany so they would not speak Sicilian. They would not be contaminated by speaking the local Sicilian. My parents were enthusiastic about Sicily. I went to the school, where I did not learn Italian, but I learned Sicilian and Latin.

Then, I go to boarding school, where my teachers are refugee professors from German universities. Alongside the Thames River with a six-foot rabbi who believes in physical athletics. He was a really athletic guy, and he really believed in mens sana in corpore sano. We did all the sports very seriously.

The cadet corps was wonderful because the teachers were sergeants. All of the sergeants had been through World War II, because we’re now in the early 1950s. Actually, in our case, it was the Oxfordshire and Buckinghamshire Light Infantry. They had all been in the Eighth Army. They went from North Africa, Italy, and so on. When they were teaching us how to use weapons, they had real knowledge.

Also, Britain still had an empire. Everybody in that school was looking forward to having a career in imperial policing and so on. Along the way, you do your years in uniform, and then you do whatever you want to do. That applied even to Jewish kids or the sons of dentists who wanted to be dentists. They didn’t want to be dentists without doing not just a national service, four or five years, that kind of stuff.

These were all things that I can claim no credit for at all. It was accidental. It was my parents who brought me to Sicily, and therefore I learned Sicilian, and therefore I learned many, many things, including the art of violence, controlled violence. Even as very young children in Sicily, you could never escalate fights, because if you won the fight over the other 8-year-old, the 10-year-old would come, the brother. Then, another brother, and then the parents would come out, then guns would come out.

You learned, actually, the coherent use of force, which is very typical of the culture, which is the mafia culture, really, is that you don’t waste force. If you go around punching people for no reason, this is really terrible. All these other stuff were all giving to me without any credit on my own, any merit on my own. It was what you might call an extraordinarily fortunate childhood for somebody whose final destination was not to paint, or make films, or build houses, but to do what I have done, which is to study war and all these other things. I was given all this right at the start.

Jordan Schneider: Why should people study war?

Edward Luttwak: Well, the reason I studied war is that I was coming from a World War II family, let’s call it that, arriving in Sicily, where the controlled use of violence was the essence of society — the Italian state pretended to rule Sicily. As a matter of fact, they still pretend to rule Sicily today.

Sicily was actually ruled by the mafia. The mafia is not the mafia of the films and so on. The heads of the mafia were lawyers, notaries, dentists, surgeons, and people like that. Yes, it was something. Then, I was very determined to take part in any war I could take part in, because I did not want to miss the experience of war.

I read Churchill’s book, The River War. He was very poorly educated. He never really studied at university or anything of the sort, but he was a young subaltern, a young officer in the war against the Mahdi in Sudan. He was a cavalry officer. He wrote The River War, which was a book about his experiences. He took part in the charge of the Battle of Omdurman, which is really just about the last charge of cavalry with swords drawn. He published his book in London very soon after, which was immediately reviewed by the people.

The first people who read the book had taken part in the war against the Mahdi in Anglo-Egyptian Sudan. In other words, he had to tell the truth because the book that appeared was read immediately by the other officers.

He, in that book, already revealed an understanding of the basic dynamics of war, which would enable him to be a pioneer. For example, Churchill understood that to advance against machine gun fire, you should carry a plate of steel, and it’s not convenient to carry it in your hands. It’s heavy. You need to have a vehicle — the tank. He’s the one who understood that you cannot outpace the rate of fire of a machine gun.

When radar came along, he understood that radar should be used to have a defense perimeter. The Germans never understood that. The Germans used radars for individual dual engagements. He understood the most important thing is to have a perimeter so that you know where they’re coming, so you can make a rational use of your own fighters and not spread them around.

Then, and this is important, when the nuclear weapon comes along, because some refugee mathematicians contradict the prevailing opinion that fission bombs are impossible, which was uniformly held by the leader of the profession in the United States, Enrico Fermi, who believed the bomb was impossible. Joliot-Curie in France, son of Marie Curie, believed it was impossible. Eisenberg in Germany believed it was impossible.

The dissenting people were a bunch of refugee scientists, three Hungarians who were in the United States, Teller, Wigner, and Szilárd, all products of the same school room, the class in Budapest. The legend is that these three guys went to Einstein. Einstein wrote a letter to Roosevelt. Hey, presto, Manhattan Project. The letter was put in a safe.

The actual way it started was in England, because Churchill was the chairman of the radar committee, so to speak. Every physicist had access to him. Every professor. The two guys who did the same calculations as Wigner did, Teller and Szilárd, they reached Professor Oldfield, who was an Australian at Birmingham University — he went to Churchill. Churchill is the one who actually initiated.

The same guy who never finished school, who never went to secondary school, charged Omdurman with a sword in his hand, is the guy who made the tank, and then made radar and nuclear weapons. Why? Because he understood something. He really had this sense for the realities of these things.

As I say, I became interested in war at a fairly young age.

This was a deep interest in war, and also always actually a technology interest. My last book is all about technology, but always interesting technology of war. Now, Churchill did it all by innate talent of some mysterious kind. He was not well educated. On the other hand, I didn’t have to do that. I was well educated. I had wonderful schools.

When I had to leave boarding school because I turned 16 and I discovered girls, I abandoned boarding school and went to London by myself. My parents disapproved. They said, “Either go back to Milano, Italy, or stay in boarding school. A 15-year-old kid can’t run around London.” Well, I rebelled and I earned my own living.

When I went to the local public school — state school, not public school, it was a grammar school. They no longer exist in England. They’ve been abolished in the name of equality, in the name of diversity, what you call equity. Grammar school meant that you were doing advanced-level exams.

In my school, there were six or seven boys in a class. Our history teacher was L.C.B. Seaman, who wrote a book, From Vienna to Versailles, that was used in every university to teach first-year students at university. It was Vienna to Versailles, 1850 to 1920.

Again, blind luck to be in a school, not in Milano, but in Palermo, where a disciplined teacher gets away with teaching the language is not — Instead of not teaching Italian, teaching Latin. Then, blind luck to have landed in a boarding school in England, where you had these refugee professors from Germany who were great men, basically, great men teaching kids. Several of them deserve a biography, actually.

All good luck and everything else. Then, it went on, because I never actually started a career of any sort. I was an oil consultant in London. Very well paid, actually, because I got the job — I was flying to Paris. I had a girlfriend in Paris, so I used to fly from London to Paris. The only way I could afford it was the overnight mail flight. You paid £10 for the flight, which was money, but not huge money. One day, instead of other scruffy people like myself, next to me, there was a guy wearing a three-piece suit. He was running this very expensive oil consulting firm. The flight was long, two hours or something, because the planes were not that fast. He hired me. He hired me right on the flight, “Come to London. Come to see me. You’re going to work for me.”

What was the work? Middle East political advice for oil companies like Shell, British petroleum and others. What was the problem? Turmoil and coups. I went to Beirut, and I interviewed the people who were being overthrown from Syria, the Chief of Intelligence, wondering, going to the cafe with everybody else. I wrote my first coup book on that basis. I wrote it by interviewing these people on how they made coups. My book was called Coup d’État: A Practical Handbook, a provocative title.

My book is a practical handbook on coup d’état, and it starts with the phrase, “Overthrowing governments is not easy.” It’s written from the perspective of somebody who’s planning a coup, not a description of how this or that coup was planned.

The book was born because I met a man called Oliver Caldecott in a pub. He was an editor at Penguin Books, and he says, “Well, what about writing a book?” I said, “What do you mean a book?” I had no intention or idea or conception of writing a book. But he more or less said, “You have to write a book.”

I was thinking I could write a handbook on coup d’état. He gave me a contract. He gave me the money. I spent the money. Now, I was obliged to write a book. I had very little time. I had the typewriter, Lettera 22, a mechanical typewriter, tik, tik, tik. I wrote the book very fast after work, because I had this oil consulting job, which was a fantastic piece of luck.

Then, the book captured me. I started writing as a lark, really. Then, by starting that particular way, “Overthrowing governments is not easy.” The first thing, I got carried away with it, and that’s how I wrote the book.

Now, Penguin itself, the editor, Oliver Caldecott, was also an extraordinary fellow. He was very enthusiastic, and he successfully sold it to something like 15 different foreign languages right away, including Germany and France. Of course, the German publisher invited me to Germany and all kinds of things, and then in France. I was in Paris when the book was published.

In 1968, there was a revolution in Paris. I was so enthusiastic about Paris and a particular lady I met that I stayed in France. I basically left London and lived in Paris, except there was the June 1967 War. There was a buildup before that war. It wasn’t a southern war like 1973 that was out of the blue. There was a buildup. I went to Israel. I went to the upper gallery. I was put in a local defense. I claimed my British credentials with these old weapons I’d used. The local defense used those old weapons. The Israeli regular army had the Belgian FN rifle, which was a new type of 762 mm rifle. Later, they had British Lee-Enfield rifles, the very ones that I’ve been trained on from age 13. They had Bren guns, the light machine gun with the recur magazine, which was our machine gun. The weapons were totally familiar to me. I greatly enjoyed that war, I have to say, because it ended rather gloriously. Went up to the Golan Heights. I was not in the first echelon, the second, the third or the fourth. I was with the tag-along looters, whatever you call it.

The first echelon suffered casualties. It was a heroic fight. I saw it all because the Golan Heights are so steep that, standing at the bottom, you see everything. I certainly was not fighting heroically. That was the war. I left my job in London to go there. They didn’t fire me or anything. The war didn’t last long.

That was the first time that I was in combat. I discovered that a lot of things that I thought about combat were wrong — for example, that you have to be brave. You don’t have to be brave. You don’t. I was never in a cavalry charge like Churchill was, who gets on a horse and charges against the enemy who was shooting at you.

I didn’t go up to the Golan Heights. I wasn’t first echelon. I was just a rear guard. The only thing I had to do was to repel attacks. There were a couple of Syrian attacks, nothing very elaborate. A few tanks with some infantrymen working alongside them, very old-fashioned, minimal. You shoot at them. I didn’t see anybody being afraid. I wasn’t afraid. That was my first introduction to it.

Actually, the Six-Day War, everything was wonderful about it, except that it ended very quickly, just when you were really enjoying it. The ‘73 war was better. I was a volunteer for that one as well. I didn’t go there before as I did in 1967. There was a crisis buildup, and I got there before. This one, I arrived on the second day or even the third day, possibly.

I was milling around with somebody, a former army general, who had been an attaché in Washington. Became an army general, organized a whole new army division by pairing odds and ends of people with captured Soviet armored cars, eight wheelers, troop carriers, and tanks. He created a division out of nothing. The equivalent of a division, it was all missing pieces and so on. We crossed the Suez Canal. I crossed the Suez Canal and ranged in the rear battlefield and so on.

As I say, I don’t think I was ever in serious combat. Not at all, but I was simply moving around — I was present in a battlefield where things could have happened, but I’ve never actually experienced it, neither then nor later when I was a contractor in Latin America and so on. I never actually experienced this question where, “Oh, I must be brave.”

In other words, I was never in the First World War. I never experienced that of being in a trench in the First World War and people blow the whistle and you’re supposed to abandon the protection of the earth in front of you to jump up, face the enemy, fire machine guns, trade bullets and so on. I never experienced that.

I was in combat in many different places. I was actually in the British army. They deployed us at one point to Borneo, no less. I was never in a situation where, in order to be a soldier, to be there, you had to expose yourself to murderous, lethal, intense fire, that kind of stuff. I just never experienced that. I have no idea how to react.

In Borneo, we were very few, and the enemy was even fewer — there was a jungle and so on. The British army, at its best, because the British army was at the time, as I learned much later, operating a whole jungle school in Johor, Malaysia, where even American officers went later on when the Vietnam war stopped. Only the British army had the jungle school.

When we ended up in North Borneo, I asked the lieutenant colonel in charge of the battalion, I said, “Where are the jungle specialists who tell us what to eat and what to wear and how to do this?” “Oh,” he said, “Naturally, they’re all in Germany, in the British Army or the Rhine. The whole command doesn’t have a single one.” I said, “Are you bringing them back?” He says, “Well, the ‘War House’ keeps promising one,” that’s how they call the War Office, the Ministry of War. We had to improvise everything.

The British army always goes to war completely unprepared. In the end, it wins because it doesn’t break apart. We were sent there with woolen uniforms suitable for Germany. The British army was focused on Germany. We had woolen uniforms that you couldn’t wear, so we had to basically strip, go around with underwear, because in the jungle, you would just die. Our rations were heavily on corned beef. As I’m sure you know, in tropical conditions, if you eat corned beef for a month, you will never recover from the gastric complications that this causes in tropical conditions and so on.

Our rations were wrong, and our weapons were completely wrong, because the Borneo jungle is very thick, very dense. Our rifles were very long. Our rifles was called the SLME, the short Lee-Enfield. They called it short because it was so damn long, and you couldn’t swing it around in the jungle.

I never experienced that kind of war, where you are standing in a trench and they’re going to tell you to go over the top of the trench to face gunfire.

The Iliad and Revolutions in Military Affairs

Jordan Schneider: You mentioned your interest in the interaction between technological change and warfare. Could you pick a few examples from history, and explain how they illustrate the dynamics, how technology ends up changing the way it happened?

Edward Luttwak: Small arms, as you know, arrive as arquebuses, with a very low rate of fire and then they get better rate of fire. Then right through, as Europe evolves and modernizes, you have soldiers that are regimented — they advance in files and lines. They have to advance against artillery, they have to advance against muskets and so on. Then, a whole culture of uniforms, of martial music, band music, a whole culture of bravery against fire is what enables war to continue once firearms arrive.

Jordan Schneider: Right, because if not, who would do this?

Edward Luttwak: When the firearms arrived in Japan — and they arrived and very quickly and were used very well — the response of this society was to stop war and to have the shogunate that suppressed all war. The samurai culture continued, but it was devoid of actual consummation, so to speak, because the shogun stopped the war. Why? Because the Japanese social structure could not survive the firearms.

In Europe, they didn’t stop war. Indeed, social structure continued to be smashed by firearms. Finally, we reached the invention by the very important American Hiram Maxim [the automatic machine gun]. Suddenly, by being able to fire 550 rounds per minute of belts of 50 rounds, the entire culture of Europe — or the war culture of infantrymen, drilled and disciplined to advance against fire, that is, against the peppering of muskets — becomes irrelevant.

Of course, they tried at the beginning of the First World War. The massacres take place in battle — 10,000 dead here, 20,000 dead there — to achieve no advance of ten yards or something. Technology intervenes in war, incrementally and invisibly, changing nothing.

Then, suddenly, technology intervenes and changes everything. It ended the possibility of the cavalry charge. Cavalry gets swept off the battlefield.

Finally, there is technology, the tank. If the machine gun fired small arms ammunition and a piece of steel stops it, and now you find a way of bringing the steel forward, because somebody else, unrelatedly before the war, had invented the agricultural tractor with tracts and an engine to be able to pull plows in thick terrain.

Technology arrives abruptly to take you out of a bind, in effect. The First World War would have been a complete stalemate were it not for the tank. The tank broke the stalemate. A single invention. Technology intervenes abruptly. When it does, the ability to change everything, to make the strong weak and the weak strong.

Jordan Schneider: What books come to mind that illustrate the interaction between technology and warfare?

Edward Luttwak: The poet, Robert Graves, wrote his memoirs, Goodbye to All That, where he gives a detailed description of fighting in the First World War, and I learned enormously. The poet, Robert Graves, had the poetical education from a young age. He was conscripted for the First World War. All his friends, like Siegfried Sassoon, were all anti-war people, but quite a few of them were heroic fighters.

Graves, who came in as a second lieutenant because he was upper class, ended the war with no particular ambition. He ended the war as de facto brigade commander. He writes about the First World War, Goodbye to All That, in great detail with the perspicacity of a literary man, of a poet. A great poet, I think. I learned a lot from that book about the essence of a lot of war. He writes in detail. He writes about tactical things and how command works. I learned a lot from that book written by a poet. Not by a retired soldier.

Of all the books in this room — and this room is full of books — there are two books that are dominantly important from my understanding of war. One is the Iliad, and I have 10 different editions because people ask me to review them.

The other is the British official history of the strategic bombing offensive. The official book on the British strategic bombing offensive, by itself, is worth three-quarters of the books in this room put together. In the official history of the British bombing, what you get is the fact that war is actually a reaction. The British bombers were going through, and then the Germans would find a new tactic, which they would then figure out how to circumvent and so on.

The important part is when the Royal Air Force finally finds a way to actually fly to Germany and not to get shot down totally and to be able to find the targets. Originally, they didn’t even think about how to find targets, or to even locate the city.

Finally, the Royal Air Force was able to actually generate as many as 1,000 bombers to actually fly to a German city and destroy the core of it. The traditional German cities were built of wood. They learned how to produce aircraft rationally, as the Germans really never did, by focusing on one model and resisting the temptation to interrupt, to go to a slightly better model, to maintain rhythm and production. They learned how to train people to fly bombers. Each bomber took 7, 8, 9, 10, 11 crewmen and so on.

They come around to Churchill and say, “Look, we can destroy a German city every night that we bomb. We can bomb once every three or four days. If the British industry produces 1,000 bombers a month, we will be able to bomb all the German cities, and Germany will surrender.” They basically say, “Stand down the Royal Navy, forget about the army (which is doing nothing except in North Africa), give us all the resources and we can win the war by bombing.”

Churchill replies, “In war, everything is moving at the same time. You’re successful in bombing Germany. That’s why the Germans are going to pull more resources into anti-aircraft guns. They’re going to put more resources into radar. Right now, you’re winning the radar war. British countermeasures are defeating German radar. If you defeat German radar and you’re able to destroy German cities, the Germans will switch efforts, and everything moves at the same time, back and forth.”

These are the whole basic dynamics of what becomes the logic of war. Action, reaction, the paradoxical outcomes. The very successful missile. You have three missiles, anti-aircraft missiles. One is super successful. The enemy focuses on countermeasuring the super successful, so the less successful missile is still able to shoot down airplanes, even when the best missile can no longer because of countermeasures.

All of this comes in this book on the strategic bombing offensive against Germany. In the broad sense, it was bombers and so on. Also, how Germany responds to bombing through dispersal, removing the targets and so on, so that the power of bombing is so great that it changes the world as the world reacts to this power and outmaneuvers it by evading it and so on and so forth.

As soon as I read the British Bombing Offensive into Germany, I rushed back to my Clausewitz, who was sitting out there looking at me, in order to read Clausewitz’s mountain warfare. Clausewitz is very famous. Many people read the first few pages or a chapter or two, and then they drop it. Actually, there’s a reason — it’s very hard to read. It gets really uninteresting very fast. What they really should do is to ignore all of Clausewitz except for his section on mountain warfare.

Jordan Schneider: Why is that?

Edward Luttwak: He says to you, “Well, in mountain warfare, if you can really put your troops on a peak, on the mountain peak, they will tactically be able to repel any attack.” They’re so terribly strong. That is only true tactically. On that mountain peak, nobody can dislodge them. The enemy is not making war to capture a mountain peak. It is to capture your country.

If you put troops on a mountain peak, they dominate tactically because nobody can dislodge them. But if the army happens not go past that peak and goes two valleys down, they are unable to do anything about it, because they can’t get off the mountain peak and quickly go and do a flank attack. Tactically strong, operationally weak. Operationally is how you win the battle.

Now, let’s assume that your operation is strong, and you concentrate your forces and you achieve surprise, you’re very dynamic in all that stuff, you still are not able to overcome what you meet, not at the operational level, tanks, artillery, fighting each other, but at the theater level where geography comes into it. You can have the experience of the Germans, who won almost every battle in World War II and lost the war because they could not transcend operational victory to achieve theater victory, albeit for different reasons.

For example, Rommel outmaneuvered the British and all that. Actually, you could not conquer Egypt from the starting point, which is Libya, because you could not bring supplies from Libya to an army fighting in Egypt, because it’s 1,200 kilometers of road and you don’t have enough trucks to do it. If you had enough trucks, you wouldn’t have petroleum for them. By the way, they’re so exiguous that a British empire could opportunistically attack those long, long columns, or whenever there was less anti-aircraft, very effectively. Tactical victory is overcome by operational victory, and operational victory is overcome by things like theater strategy.

Of course, in the Ukraine war, we see a simple fact. Ukrainian forces can be very heroic, but they can’t get to Moscow and force them into the war by pointing the sword at Putin’s neck. They can’t get to Moscow. Theater strategy. The Russians themselves were undone by their mistake in attacking Ukraine, which was that their concept of war was much too modern for their circumstances.

General Gerasimov, who is still there, to my great surprise, I would have fired him the next day. Gerasimov is a very modern guy. He believes that you win a war politically. Cyber war. The internet, manipulation of images, and so on forth. He gives a long list of things. At the end, he mentions he forgot about the infantry, the artillery and armor. They did a fantastic ultramodern coup de main. Helicopters arrive and drop a handful of paratroopers who seize the airstrip, then you fly in the airborne infantry. The infantry was delivered by Ilyushin transport. Then, you match up with some vehicles that have sneaked in and descended from Belarus, rush into Kiev, you take over the defense ministry, and you do a coup de main as it’s called militarily, but it’s actually a coup d’etat.

Now, you’ve taken Kiev, and now you have thousands of tanks waiting in long, long, long lines to go through Kiev in order to generate images of overwhelming strength. This is Gerasimov, how you would win the war psychologically, politically, and historically. You forgot about the infantry and all that. The tanks parade through.

When the coup de main failed, and tanks were strung out in the one column, it was very embarrassing that they turned around. Some weapons arrived in Ukraine. Some of the most useful, the Norwegians had 5,000 LAVs, light anti-tank weapons, the simplest, lightest thing. It’s a plastic tube that has an anti-tank rocket in it. You pull out the tube, you aim roughly, you pull the trigger, and it goes off. These Russian tanks were finally hit.

In other words, just the opening of the war tells you all the different ways in which it could go wrong in war. The Russian plan was ultramodern, and the head of the general staff was an ultramodern person. He wasn’t an old-fashioned, stupid idiot who believed in infantry, artillery, and armor. No, it’s all this psychology, and shock, and trauma, and surprise. Very, very clever. That is one way you can fail in war.

The newest way you fail in war is that you don’t understand the levels of war, which are very contradictory. We just had an example. Hamas did a brilliant assault, and actually caught Israelis by surprise. Israelis are very easily caught by surprise. In October 1973, when 20,000 Egyptian troops of the very first echelon, there were 200,000 behind them, arrived at the Suez Canal in October 1973 surprise war, there were 411 Israelis. They are self-confident, they are overconfident.

The other thing is this — the Egyptian army was deployed in front of the Suez Canal. If you allow the enemy to deploy on your front door, he will always catch you by surprise, because all he has to do is make noises as he attacks and immediately reinforce. When you reinforce, he doesn’t attack. Then, waits for a few more weeks, and then he makes noise, and you reinforce and he doesn’t attack. The third time, you don’t reinforce, and that’s when he attacks.

That Egyptians did very well at the beginning in taking the Suez Canal and everything else. By the way, they had 22 positions, the Israelis did, along Suez Canal. Only one of them was fully manned. With how many soldiers? 30. They never took it. They had built this very clever fortress. All you needed was 30 men. Then, in the course of the years, nothing happens. They didn’t have 30 men.

The dynamic flow for war, you read the official history of bombing in World War II, and how the British won. Then, the Germans say, “Oh, they’re serious. They’re bombing us.” They shift resources. Then, the Germans win. It goes back and forth, back and forth. Hamburg, everybody knows that in August 1943, Hamburg, mostly built of wood, was attacked by the Royal Air Force and the US Air Force. That was the first time the British bomber command could send 1,000 bombers, and the US Air Force added its bit in daylight.

Hamburg burns. Burns. The asphalt melts, and the place becomes hell. Hamburgers walk out of their city in all directions. The Nazi Party begins its transformation into a social welfare organization quite effectively. That is when the Royal Air Force tells Churchill, “We can win this war. We’ll just stand down the useless army and navy. We’ll bomb Hamburg.” Churchill was smart enough to say, “No, because your very success of last night condemns you to failure.”

In fact, after Hamburg, there wasn’t a triumphal barge for German cities, but greater and greater and greater losses and so on. Flying in Bomber Command in World War II was more dangerous than being an infantryman in the First World War.

Jordan Schneider: The chapters you did about the air war in Europe were the ones that unlocked it for me, because you really do see every level of war and the interaction between them, from the tactical stuff.

Edward Luttwak: Where did you read that? In The Logic of War & Peace?

Jordan Schneider: Yes. You get something tactically right — “Okay, if we find the four factories that make the ball bearings and we blow them up, then all of a sudden, they’re going to go back to donkeys.”

You just alluded to it right there. The success of it led to them adapting from an anti-aircraft perspective — they spread out the factories, and you end up changing the psychology of the whole regime. I’ve watched these really weird movies made in Nazi Germany in 1942, and they’re walking around on the street and going to the plays or whatever. Then, you’re in total war mode, because the city gets bombed, it’s much easier to get people to make the sacrifices they have to.

Edward Luttwak: It took really a long time to get to that point. Then, it finally evolved. The British official history of the bombing offensive against Germany, written by a guy called Noble Frankland, which is up there, that is what got me going. It contains some fantastic documents in it. One of them is the report of the police minister, the police president of Hamburg, of the bombing, which is the first description of the meltdown effect. The fire starts that attracts, sucks in air with this tornado, with high hurricane speed of the flame going up, hurricane speed, people get blown off their feet into the molten asphalt on the roads and so on.

He wrote the description. Unknowingly, he wrote it immediately afterwards, and his text in English translation in that book is a literary masterpiece.

There is a lot of good literature. War generates a lot of good literature because people are forced to think about things. War makes you think things. I consider the Iliad as the foundation document of Western civilization, whose impact on life and society was only mildly moderated by the advent of Christianity and so on. The Iliad is about the essence of work. As I say, I read the Iliad 12 times, only for the purposes of writing reviews of new translations, which I was duty-bound to read the new translations. Some of them were awful.

My most important article ever is called “Homer, Inc.” It’s available free online. It’s a description of how the Iliad was written, how it was edited, why it has the power it has, and why all the Western countries are still very interested in it. There are multiple translations, and a new one comes out every two or three years.

In India, where the British set up classics departments in all the different universities, like Madras, Bombay, and so on, nobody knows Greek. Nobody’s interested. We couldn’t sell a copy of the Iliad for nothing. The Arab world absolutely rejects it. The only Iliad available is a very late and very bad translation. Where is their enthusiasm for the Iliad?

Japan has studied it, definitely from an early point, when they modernized, when they decided to go western, they were sensible enough to understand where it started from. They didn’t try to jump into petroleum engineering without starting with Homer.

The big place is China. The Chinese are enthusiastic about it. When I wrote this article, “Homer, Inc,” there were four different translations of the Iliad in China already. Since then, several more appeared. They’re not produced by some beautiful academy of ancient history or something. They are produced by commercial publishers out to make money, and the Chinese line up and buy them.

Jordan Schneider: It’s really remarkable how Western classics have such a foothold in China.

Edward Luttwak: You experienced that in China yourself. It’s a foothold, and it’s a serious one. My Byzantine book, which has been published in different languages, Greek, Turkish, Italian, French, and so on — Harvard Press itself did a beautiful edition, I have to say, a gorgeous edition with the Romano mosaic covers and all that. The most beautiful edition is the one published by the Communist Party of China, the so-called Academy of Social Sciences, which is actually the research bureau of the Communist Party Central Committee and Politburo in Beijing. It’s called the Academy of Social Sciences.

Their publication is magnificent, the most beautiful edition. I give them great credit because it came out years after my book called The Rise of China vs. the Logic of Strategy, which is the book that says that China will fail. Even though I published a book saying that the Chinese are wrong, they would fail, they don’t understand, they published the Byzantine book. It’s magnificent.

Before that, they did not know anything that it was against their system. I first visited China when Mao was still alive. I was there when he died. I was actually one of the honored guests at the funeral in 1976.

Removing War from Europe

Jordan Schneider: Come back to the pitch for reading Homer. What can you learn in there that you can’t learn anywhere else?

Edward Luttwak: If you read the Iliad carefully, you realize that the Iliad presents a superman, because remember who the hero of the Iliad is, Achilles. Achilles is somebody who feels sorry for the Gods, because the Gods are immortal. Therefore, they can never be brave. Therefore, they can never impose their personality onto the universe, because they can do any foolery they want. In fact, there’s a chapter in the Iliad about when the Gods start fighting, and it’s a comedy. It’s ridiculous. They can’t die, so what’s the point?

First of all, it’s the only book that gives man his full dignity, because man is not afraid of death. Being guaranteed against death means that you can never be brave. If you can never be brave, you can never be fully achieved. You are superior to God, because you’re not immortal.

The Iliad teaches you really what bravery is about, and how life would be truly tragic if you were in the position of a Greek God. Because the Greek God cannot die, he cannot be brave. Therefore, he cannot be fully achieved. Everything he does is foolery and pointless. Whenever a Greek God feels like having sex, he can just transform himself into an eagle and pick up a girl or a boy, as the case might be, as Zeus did for Ganymede himself, and you can have your way. You can do anything you want. Therefore, none of it means anything.

That’s what you learn from the Iliad, which is — human being, don’t complain. Assert yourself. Make yourself realize yourself. That’s what counts. That’s the ideology of it.

Then, of course, it has all these different characters in it. For me personally, one of my great happy moments is I discovered from the translation of the correspondence, the Hittite correspondence. Troy was under the sovereignty of the Hittite empire. When they found the correspondence of the Hittite empire, they found a series of letters about Troy. They were found in the 1930s, and translated and made available belatedly in the 1950s, that’s when the Trojan War went from literature to history. You have there the figure of Alexander, also known as Paris, the one who provoked it all, and you also have Achilles.

His Hittite translator’s name is really bizarre, but the Hittite ruler is writing to Agamemnon and saying, “I understand you have a war against Troy. Troy is really a protector of the man, but I know they caused the war. But as for this other guy, Achilles, he raids my towns without any reason at all. This has nothing to do with your war. He’s supposed to be besieging Troy, and there he’s going off raiding.” Achilles grabs the daughter of this priest and so on, and then rapes her, and then he falls in love with her.

Then when they want to take her away, this is the daughter of the priest, and give her to Agamemnon, which starts the whole machinery of the story, because he doesn’t write in Iliad how the war began. It’s the 10th year of the war, and there’s this episode, not between Greeks and Trojans, but Achilles as a Greek prince was falling against the great Agamemnon, who is obliged to give up the girl he captured, because she’s the daughter of a priest of Apollo. Therefore, Apollo was attacking the camp with his arrows, and that’s why they were dying of plague and so on.

He has to return his girl. Achilles refuses to fight. He goes to his tent and says, “Even though I captured her with my spear, I won her with my spear, I’m truly in love with her. I really love her. He took away this woman I really love.” Suddenly, we realize that war was not yet a collective thing. Inherently, it was voluntary. That opens the door to something very important.

Most wars of history have been fought by volunteers. If not by actual volunteers, there are some regiments that were called to war, and people rushed to war. On October 7th, Israel was caught by surprise. On October 8th, they started issuing notices to reservists.

By October 10th, a problem built up in the Israeli army, because they had recalled reservists to the units they belonged to, which were reserve formations with all the workers, but whose commanders and so on would arrive from active duty, full-time jobs. Then, the soldiers arrive from their homes and they go to a depot. In the depot, they pick up their uniforms, their weapons, their vehicles, and roll out.

They discovered within two days of the recall that many more people had shown up, people they didn’t call. Let’s say, in this battalion, there were 400. Of the 400 reserves, there were 520 reserves in the book. They didn’t call the others because they were older, or because they were marked as having some medical issues at some point. These people who were not called up, all went anyway. They showed up anyway. This is a wonderful thing. You call 100 soldiers, and you get 120. Isn’t it wonderful?

Except that if that happens at the company level, two levels, up at the brigade level, they think they’ve got 100 soldiers in that company, but it’s not. It’s 130. They send trucks for 100, and the other gets stranded. After a while, they started issuing public notices, the police, “Don’t come. Don’t come. Don’t come unless you’ve really been called.” Then in some cases, they had to call the military police to weed out people, because they’re all there with friends, and they were covering up for each other. That is a reservist being called, you call 100, you get 120.

What happened more often in war, they didn’t have a system, that’s peculiar to the Israeli army, is that wars were fought by volunteers. People went to the colors, they volunteered to fight. The two World Wars were great anomalies when giant state bureaucracies compelled a lot of people, including very reluctant people, to go to war. Historically, wars were fought by volunteers who wanted to go to war.

The Iliad tells you why you want to go to war. Heroic achievements, the fun of it, the excitement of it, and all the rest of it. If war were not so much fun, there wouldn’t have been so many wars, because most wars were fought by volunteers. In the Civil War, there were draft riots in New York because people didn’t want to fight. That was because America was very early in conscription. Conscription, forcing people to fight, is very new. In human history, it’s a very recent development, from which there’s been a withdrawal.

Now, this brings me to a very important thing that is a tragedy on a continental scale. The energy of Europe, the dynamism of Europe, the whole thing that came out in art and science and everything else, is such that when Europeans got to that historical stage, they spilled out on the whole planet. Small numbers of Europeans conquered Latin America, conquered Africa, and conquered much of Asia. Why? Because they were forged by Europe. The intense competition between rival states that competed even more because they shared a common culture to a large extent.

Every little state was competing with every other state that generated dynamic energy. Europe was like a veritable nuclear reactor of energy from the collision of all. Florence fighting against Venice and Siena against Florence, Milano against — and then, Italy against France. This war was the engine of European growth. That’s why the Iliad was the actual constitution of Europe, not the New Testament. It was the Iliad.

The Iliad is the constitution of Europe. All these little European statelets were competing against each other. There were perpetual wars. Every war destroyed buildings. After the war, they built twice as much. The warriors went to war. They loved war because they were all — 99% were volunteers. Until you get really to the first 19th century, really, late 19th century, you get volunteers.

Men love war. Women love warriors. Instead of the population going down, as soon as the war ended, the warriors would come back, women would jump on the warriors and vice versa and make children. From war to war, Europe’s population increased. Europe was a land of children. Every time there was a war, there’d be more children. And then, there’s more reconstruction.

Now, somebody had this idea of removing war from Europe. There were problems with war by 1945. Not only the fact that the Second World War was really horrific, more than any other war, really, but also, the advent of nuclear weapons made it seem a bit pointless. There was definitely a problem. There was exhaustion. The exhaustion of 1945 is a simple, normal exhaustion that you had after every war for 2,000 years. Then, there was the nuclear fact as an intellectual fact somewhere out there. Then, there was the fact that the war was particularly horrific.

It was long. It was long, ‘39 to ‘45, long and horrific and a lot of disappointments. There was a lot of really huge destruction and so on, killing and many more people died and so on.

Europe gives up war and you say, “Oh, wonderful, there’s no war.” What they did was they removed the engine of the car. Because, since you remove war from Europe, there are a number of other things happening. First, Europeans stop making children. The most pacifist societies, Spain and Italy, make the fewest children. There are more veterinarians than pediatricians in Northern Italy. There’re not children, actually, and there’s no dynamic energy. All of it is gone.

War was a machine. It was the intense competition between all the different European states and statelets, by putting them all in a union together where they can’t fight each other, the armies, navies, and air forces remain as ritualistic things. They have no real combat capability. The Royal Air Force recently flew to Cyprus, and from Cyprus to Yemen, and dropped bombs.

There are air forces in other countries, and they have generals and airplanes, but they can’t do it. If the Italian air force were ordered to bomb Yemen the way the Royal Air Force would, they would have a big advantage, because the Italian air bases are much closer to Yemen than the UK. The order would never be issued.

Right now, Italy has a right-wing government, or at least center-right. What Prime Minister Meloni puts on a tweet is a celebration because the big Italian warship, the Vulcano, a very big ship, came back from El Arish carrying some Palestinian children who need medical care. Whereas the Italian ports are in distress because traffic is interdicted in the Red Sea, which means that Italy is bypassed. This affects the Italian economy powerfully.

The Italian Navy is the largest in the Mediterranean. She does not send it into the Red Sea to defend traffic to save the Italian economy. Instead, she sails a ship to El Arish to pick up some Palestinian kids. Why? Because even the center-right government, in fact, neo-fascist or whatever she is, has decided that war is no longer admissible. In fact, they have sent one frigate to the Red Sea, but not as part of the US Anglo-American Operation Prosperity Guardian, but separately as a European mission with the Germans or whatever. Not only are they not attacking the Houthis, of course, but they’re not even intercepting Houthi missiles, unless they aimed at themselves.

You can divide nations into two categories. Three, actually. One is countries for which war is irrelevant. Like Nauru, for example. 1,000 people in the Pacific with no enemies who can reach them. War for them does not exist. It would be absurd to bring a war philosophy to Nauru in the Pacific. For everybody else, I use the very ancient Latin concept that only I use, which is capax belli. Capax, capable of war. Bellum, of course, is war. Genitive is belli, capax belli.

If you go and research and try to look for the original quotation of it, you won’t find it, because I invented capax belli. It’s an ancient Roman concept that happens to have been invented in Maryland, by me. It is a useful concept. Countries capable of work and those that are not. The British spend a lot of money on the Royal Air Force, but the Royal Air Force is capable of war. It just flew to Cyprus and Yemen and dropped bombs.

The other air forces in Europe also cost a lot of money. They’re also expensive, but they’re not capable of war, because either the political level cannot issue such orders, or they go against the spirit of the age, as they would put it. All because the pilots didn’t really sign up to really fight, “What? I’m supposed to be flying over Yemen? What happens if I get shot down? I’ll be taken by tribesmen who will tear me to pieces.”

There’s no enthusiasm. I don’t see protesting airmen all over Europe saying, “How come we are not helping to fight the Houthis as well? I’m a fighter bomber. Why don’t you let me fly on it?” No such thing.

In some cases, like Spain, the Spanish have an air force, they do, and they have combat aircraft, and they’re not cheap. If the Spanish government ordered them to bomb Houthis, they would not do it — there would be a protest. The pilots would walk off.

Once you’re not capax belli, you have lost something that binds your country, makes the country effective as a country and makes military institutions valid. If you are not capable of war, that doesn’t mean logistics, like you don’t have enough ammo or something, that’s never a problem.

Jordan Schneider: It’s a psychology of political leadership.

Edward Luttwak: The psychology, the culture, the political thing. By the way, right into the military. When Italian soldiers were deployed in Afghanistan, it was essential they should not go into combat. The Taliban were paid off, basically. They paid off the Taliban so they could patrol unmolested. Once you knocked capax belli, you switched off the engine, and you lack dynamism, you lack capability. You can’t do anything else either.

Jordan Schneider: There’s an interesting argument you make in the China book, where you look at Germany in 1890 and you say they had it all. They had the chemical companies. They had the universities. They had the economic dynamism. Had they not wanted to taste the forbidden fruit of national greatness as expressed by hard power in the form of battleships and international colonies, then the 20th century probably wouldn’t have turned out — or the first half at least, wouldn’t have turned out a lot better for Germany.

Edward Luttwak: No, I would say that if Germany had not gone to war in 1914, given the fact that it was more advanced in the chemical industry, metallurgical industry, and had competed with the United States only for the electrical industry, dominated the pharmaceutical industry. Deutsche Bank was the largest bank in the world, the most powerful bank in the world in every possible way. Given the fact that German education had advanced so far beyond anybody else, it wasn’t just universities, you understand, it was a high school. The German Hochschule, which just means high school, was a formidable institution.

If they decided not to go to war in 1914, then Europe would have been compromised in other ways, because Germany would be absolutely the dominant country. That would not be a problem. When I was born, German was the dominant language, even though it was ruled by Romania. All the books were in German.

The fact is, Germany dominated from the pharmaceutical industry to education, to every damn other industry, to the university. Also, the domination was self-enforcing, because the best and brightest would go to German universities. The people of the Manhattan Project were all Hungarian Jews and Polish Jews, whatever they were.

Jordan Schneider: Oppenheimer, famously, of course.

Edward Luttwak: But Oppenheimer was born in America. All these people, most of them were not. They were born all over Europe.

Jordan Schneider: He went to study in Bonn.

Edward Luttwak: Of course, he went to study in Germany, and they went to Germany. The Hungarian bunch were beneficiaries of highly superior secondary education and mathematics teaching in high schools, and Hungary was the world leader in every respect. Russians today, by the way, the Russians, with all the decline of Russia and all the fuck-ups and screw-ups and all the problems they have, even today, Russian high school teachers, mathematicians are superior in their education.

Germany would have been the dominant power. All they had to do was not challenge the Royal Navy, because German commerce worldwide was protected by the Royal Navy. The Royal Navy protected German commerce as German commerce was becoming more and more dominant all over the place. From coffee plantations in Southern Mexico, in Guatemala, to every damn thing you wanted, and traveling the world’s oceans protected free of charge by the Royal Navy. That’s when they decided to challenge the Royal Navy.

In case a comparison comes to mind, the Chinese wanted to challenge the US Navy, which enables them to sell all over the world. Who would do that? Insanity.

Jordan Schneider: This is what I want to bring it back to the Greek tragedy, because you have these two countries, Germany, which is doing everything well. All the trend lines look really great. Then, China in the 1980s, 1990s, and 2000s, is really firing on all cylinders. You have this incredible integration with the global economy. Is there something just about humanity where, when you see power, you have to take it all the way?

Edward Luttwak: One can go beyond that. One can go into a more logical sequence. The wonders of free economies, commerce, the wonders of science and the industry it brings, all of it is just really wonderful, but it’s all based on different kinds of freedoms. Those freedoms are conceded by a state. You have a state that maintains law and order, protects the borders, but it’s a state whose politics, whose matters, whose leaders limit their accumulation of power. They allow you freedom to operate sufficiently so that the economy can flourish and academic universities can flourish.

Then, what happens is that they still have the quest for power, they still have the craving for power, but they manifest it, not by imposing themselves on their own citizens, but they manifest it, for example, in colonial competition or something at the turn of the century or something of the sort.

The problem was that the Germans dominated Europe militarily, but they could not expand militarily. As Bismarck had explained, Germany, with his wonderful army and everything else, had reached the culminating point of success in 1871 when they formed the German Empire. Bismarck understood that if Germany expanded by another square meter, it would start a process of global coalition against Germany and to stop it.

He was blessed by the fact that von Moltke, his chief of imperial staff, fully understood strategy. As soon as Bismarck formed the German Empire in 1871, he was greatly applauded. A week later, people started saying, “Well, the Italians are unifying Italy. All the Italians are coming under the Italian flag. We have Germans in Silesia that are Germans, but then we have Germans there, and we have Germans in Transylvania, as it happens. Mainly, we have the Germans in the south in the Austrian Empire. Now, the Italians have unified, the French have unified. Why the hell can’t we unify?”

Bismarck basically said words to the effect that, “We have reached the maximum culminating point of success. In our lifetime, in the lifetime of our children, Germany cannot expand by one inch. If we expand by one inch, everybody else will gang up against us. Everybody will gang up against us.” He might have said, “Even the Americans,” or something. He understood there is a culminating point of success. Going beyond that doesn’t make you most successful, but you descend the curve of success.

As I say, his luck was von Moltke, the chief of the general staff. It was intellectuals, naturally, professors and so on, who said, “We have the most powerful army in Europe. We have unredeemed Germany, because we have all these Germans who are not in Germany. Everybody else is unifying, the Danes, the Italians, the damned Portuguese. Only we have Germans stranded outside Germany. So, we have to use our power to unify Germany like everybody else. Are we racially inferior that we can’t be unified?” These were very strong arguments. They were not advanced by hotheads in pubs. They were advanced by university professors.

The first place they wanted him to expand was, of course South to Austria and so on. In the Balkans, with the excuse of the Balkans, the Balkans are in turmoil, and he comes up, he says, “All of the Balkans are not worth the bones of one of my grenadiers,” and so on.

He had this very clever guy, von Moltke, the chief of the general staff, who not only understood tactics and operations. He was the one who really understood how to operate the railways. He also understood that tactical victories are worthless. You need operational victories, all these things. He was not a man who wrote books, but he clearly understood all that from his single decisions that he was making like that. He backed him firmly.

The moment that von Moltke is gone, Bismarck is still held up until the young Kaiser comes. The young Kaiser says, “We have to use our power to unify Germany. It’s our duty. We left our fellow citizens stranded. We are sailing in a ship, and we’re leaving them on the shore.”

Then, the intellectuals weighed in. The German tragedy would not have been possible if all the intellectuals had not lined up in support of the idea of building a fleet to challenge Britain. Britain was assuring the commerce of Germany all over the world through the Royal Navy.

What happened is that the British reacted, and they resolved all the quarrels they had with the French. They made 72 concessions and 72 colonial disputes. They satisfied everybody so that the next thing Germany turns around, they find themselves surrounded by two world empires against them.

In the case of China, Xi Jinping is particularly inexcusable and shows his intellectual nullity. For all his pretensions that he knows literature, I trust him that he really is very interested in literature. I’ll give you a small proof of it. Goethe wrote three or four or five times more than Shakespeare. Therefore, there’s no complete Goethe in English. There’s no complete Goethe in French. There is in Chinese. Under Xi Jinping’s order, the Shanghai Foreign Languages University had to mobilize all 85 Chinese Germanists to bring all of Goethe in translation in 87 volumes. It doesn’t exist in English.

I believe he understands literature and loves literature, Xi Jinping. But clearly, he has no understanding of history, because Chinese commerce is carried by the US Navy. The US Navy protects Chinese commerce. For them to oppose the US Navy is the same level of high-grade idiocy.

That’s exactly what Xi Jinping says in China, “We have to challenge the US Navy, because if we don’t, one day, they will suddenly shut down everything.” This is not an ordinary error — I made mistakes. I made them because I’m stupid various times. I made a mistake yesterday. I made a little mistake because of some foolish calculations. You need intellectuals for this. To make that level of error that Germany made in challenging the Royal Navy, beginning the whole competition, causing the British to start organizing a coalition against them — for that you need the intellectuals.

Jordan Schneider: You have this action and reaction, which you saw in Germany and you’re seeing now in China today, where the rising power gets ahead of its skis. All of a sudden, the entire region recognizes the fact and reshapes itself to make sure that power isn’t able to manifest its mission. We have that, but we also have these moments in history where you get leaders who have this sense of temporal claustrophobia, of, “Whatever odds I have today, they’re going to be worse tomorrow.” Then, you have horrible wars start.

Edward Luttwak: There’s also protagonism. Hitler started the war in September 1939 because his health wasn’t great, and he was afraid that he might decline before Germany could fight this necessary war. There were plans to start the war in 1942. He missed out on three years of production or something.

Xi Jinping undoubtedly has this belief that he must rejuvenate China. Paradoxically, China is shrinking and getting older by the minute, because they don’t have babies, but he wants to rejuvenate, and he rejuvenates by fighting and so on. Then, intellectuals provide the rationale that we have to attack the US Navy, because even though our commerce has gone global by the protection of the US Navy, undoubtedly the Americans will not let us really come out on top, so they will abruptly shut down Chinese commerce unless we have defeated, we are in a position to overcome their navy and all that. For that, you need intellectuals.

You need intellectuals to concoct these elaborate explanations of why Germany has to attack the Royal Navy, which was providing the security for its global commerce that was essential to German life, and its growth and so on.

Whenever you see the Chinese navy’s development, and you hear what Xi Jinping says when he visits — the last speech I studied in detail was his visit to the Eastern Theatre Command, it’s the command that has Taiwan, and says, “Most important thing, you have to be ready for war. The most important thing, you have to be ready for war and victory. You have to be ready for war, and I mean real war. You have to be ready for real war and then win a victory.”

He is exhorting them. Exhorting them. Historically, the Chinese never fought. The Chinese were conquered by foreigners. The last foreign dynasty was the Japanese. If the Americans had not defeated Japan in 1945, the Japanese very likely would still be in Beijing, Shanghai and Guangzhou, with the nationalists and the Japanese and the communists fighting it out or whatever it is, backed by one or the other.

To make these mistakes, you need intellectuals. Intellectuals mediate. Then, you need the guy who’s afraid that he will die, because his successors are unworthy and only he can achieve this thing. That sets up the timing.

The Chinese are a profoundly unmilitary nation. Profoundly unmilitary. They are not really fighters at all. Therefore, in 1895, a very big Chinese navy with modern German warships was defeated by a small Japanese navy. The Japanese are fighters. The Japanese come from a culture of fighters, but the Chinese do not.

“You cannot deter Persians by killing Arabs.”

Jordan Schneider: What is the right way to conceptualize deterrence?

Edward Luttwak: The right way to conceptualize deterrence is by realizing that everything about deterrence is taking place in the mind of the enemy. You don’t deter by building a missile or by not building a missile, building 4 missiles or 17 missiles or buying this or buying that. You deter by understanding your enemy and understanding what deters him.

For example, right now, the United States periodically attacks the Shia militias to deter them. Actually, they’re just exact agents of the Iranians. Not only do all their weapons come from Iran, but they’re commanded by Iranians. You can’t deter Iran by killing Houthis, because the Persians do not consider Arabs to be people whose life or death is very important.

You cannot deter Persians by killing Arabs. They consider Arabs expendable. Arabs are not much use for anything, so give them a weapon, have them shoot at other people. They’re not Persians. If you want to deter Persians, you have to kill Persians.

That simple proposition doesn’t get through in the White House, because it cuts against the concept that all races are equal, of course, and we would consider Arabs equal. Therefore, the Iranians must consider them equal.

The Shahnameh is the national book of Iran. The Ayatollahs wanted to forbid it, because it’s not Muslim. The guy who wrote it was post-Islamic, but the Shahnameh is a book about Persia, about our Persian kings and Persian heroes, not about Islam at all. Then, as soon as they got into war with Iraq, suddenly, they started printing editions of Shahnameh, pocket editions, big editions, ceremonial editions and so on. The White House hasn’t read the Shahnameh. If you read the Shahnameh, you realize that you cannot deter Iranians by killing any number of Arabs.

Deterrence starts with that. Deterrence starts with understanding the mind of the enemy. What will deter him? Because you don’t do deterrence. Deterrence happens in the mind of the enemy. Therefore, it’s conditioned by what the enemy thinks is dangerous and not dangerous. You could not deter a Japanese suicide pilot, because he was serving the emperor. He was achieving the maximum possible thing.

Imagine I could sink an aircraft carrier, bringing so much joy to the emperor, and I will become famous. No way you could deter this. You have to deter by starting the mind of the enemy.

Now, in the case of the Soviet Union as an empire that was built on strategy, Russia was and still is today the largest country in the world. Nobody gave it to them. They got it because they won the wars. They won the wars. They won the wars, because Russians understand strategy. They understand only two things, poor Russians, mathematics and strategy. The Israelis think that Jews are very smart and all that. When the Russian Jews arrived from the fall of the Soviet Union, which they really loved to bring about as people then recognized, because they rebelled openly in Red Square. Nobody else did. Of the 80 nationalities, only the Jews went to Red Square with the Jew flag, starting the whole process.

When these Israelis would convince themselves hard, when the Russian Jews arrived, and not all of them came from Downtown Moscow, they came from everywhere, from all remote areas, suddenly, the Israelis realized that they’d never been teaching mathematics in Israel. They had no idea what mathematics was. These refugees on arrival didn’t have anything. The first thing they insisted on was to set up after school math classes.

You have to understand that to deter the Soviet Union, what you had to do was to say to them, “Okay, remember World War II? We are going to destroy much more than the Germans destroyed. Much more.” The doctrine came out, a massive retaliation. That was a perfect doctrine for Russia to understand.

Now, it’s much harder to deter Iran today, because [during the Biden administration] when the Iranians look at Washington, they saw Robert Malley, who was their agent, basically. I don’t say he was an agent in the sense of being a paid agent, but he was somebody who was highly sympathetic to Iran and hated Saudi Arabia and hated Israel. He’s a second-generation Zionist hater. His parents hate Zionism so much that they work for the FLN in Paris.

They saw Malley, who is the ally. They saw Sullivan, who was a very nice young man at the time. He was the one who negotiated in Vienna and made all the concessions under the table to the Iranians. Along with Burns, who was the head of CIA, but also a very important advisor, really.

Burns and Sullivan in the window, that’s America. Iran felt that these people were easily manipulated. Because they are in a window, it’s much harder for the United States to deter. Certainly, you cannot deter by killing Arabs. Not Iran. Their national culture is the Shahnameh, the book of the Shah. That’s their poetry. In this book, the Arabs are the vandals, who came in and attacked the Iranian civilization and put nothing in its place. They’re nothing, these Arabs.

Jordan Schneider: How about deterrence in China, though?

Edward Luttwak: Well, deterrence in China is, first of all, we have to recognize that in spite of everything that we could have expected, the modern autocracy is a very strong institution. Trotsky said that once you had the machine gun, you couldn’t have an insurrection. The only one who didn’t do it was the Shah, because the American ambassador kept telling him, “Above all, don’t shoot. Don’t shoot. Don’t shoot at these crowds.”

If the imperial guards in Tehran opened fire and killed 1,000 people in front of the palace, we wouldn’t have all these problems. Trotsky did not point out that the prince could lose his nerve. If he loses his nerve, the Maxim machine gun with 500 rounds per minute doesn’t help you.

Jordan Schneider: How should we conceptualize deterring China today?

Edward Luttwak: First, you have to accept that it’s an autocracy, that despite everything that’s happened, single men were making a huge difference. Saddam Hussein’s mistake was other Iraqi potentates who were living very well under Saddam did not preserve their way of life by killing him at the last minute when he failed to surrender to the Americans, which is what he had to do. Then, they could all keep their mansions and everything.

We have to deal with Xi Jinping himself. They obey Xi Jinping. Xi Jinping has a way of getting rid of people who disobey. I have no evidence whatsoever for what I’m about to tell you, but it’s about the former defense minister [Qin Gang]. One of the first things he did was go to the Shangri-La diner in Singapore, as I did.

Now, I go to this dialogue, and a journalist asks him, “What about war with America?” He says, “It will be a terrible, terrible, terrible disaster. It will be an awful, awful, awful disaster. It will be catastrophic, catastrophic disaster.” He got fired. There were stupid stories about corruption.

I believe that the Chinese ambassadors in Washington who lived here in Washington as in Washingtonian, goes back to Beijing. He’s briefed by Xi Jinping about his plans, and he manifests no enthusiasm. May even have said, “Don’t do it,” or something — and he then disappears. Literally disappears.

The story that spread — that he was having an affair — is complete rubbish. Not believable rubbish. It remains that even one newspaper man repeated this accusation without saying so, because the Chinese ambassador in Washington, everywhere he goes is, of course, he has his own security that follows him. Everywhere he goes, the Chinese spies follow him, and the federal protective service follows him. For him to have an affair, he had to accommodate three people in his bed.

They had found a photograph of him being interviewed by a beautiful woman, and that was the story. That he was fired because of an extramarital affair — nonsense. He was fired, because after living in Washington, he is brought back. Once he’s elevated to foreign minister, is briefed about Xi Jinping’s intentions, which is to rejuvenate China by starting a war with Taiwan.

For which purpose? Farmers all over China last year were under orders to stop cultivating spices, fruits, vegetables and all kinds of things, or even keeping ducks, because you have to grow grain. Because in 2022, China imported about 130 million metric tons of grains, which represents the largest traffic in the world’s oceans except for iron ore and petroleum.

Now, how do you rejuvenate? Well, by seizing Taiwan. Of course, you run into an American warship or two, and then you have a skirmish, but it doesn’t escalate because we all have nuclear weapons. You establish the fact that the Chinese are a great fighting nation. They fight Americans, they fight the Taiwanese and all that kind of stuff. Then, we win a victory, and that is how we redeem Chinese history after the century of humiliation. That leads to the 1979 war with Vietnam. China attacked Vietnam. Vietnamese killed 50,000 Chinese. The Chinese walked off and gave up, and so on.

Incidentally, in the Korean War, they not only fought bravely, but they threw themselves against fire because there were Kuomintang soldiers. The Kuomintang soldiers, each of them would prejudice their family, and the family was blackballed because the son was in the Kuomintang. If only you were killed in Korea, your family would become red. By becoming red, they would have access to land and be able to survive, instead of being condemned to death, because when they allocated land after the landlord reform, black families didn’t get any and so on.

In other words, he has built a whole castle of things to do something highly illogical. For the Chinese — for whom global commerce is the key to prosperity — to challenge the US Navy is totally irrational. In order to rationalize the irrational, you have to fantasize that the Americans have a plan, that a certain moment they will intervene and stop all commerce.

Then, you connect it with your rejuvenation of the Chinese people, and you bring in the fact that the Chinese were a defeated nation, that foreigners conquered. Foreigners came, killed them, raped their women and ruled them. Now, we’re going to rise up.

This is like Benito Mussolini, who is the only Italian who understood that Italy did not, in fact, win the First World War, which was taught in schoolbooks, and who put children, schoolboys, in uniform, got them little rifles and all the walls in Italy when I was a child were still written with the slogan, “Better one day as a lion than a hundred years as a sheep.” He was fighting to make Italians a great warrior nation.

He was an honest man intellectually. At the end, he realized, and he said, “It is not true that it is hard to rule Italy. It’s useless.” Meaning that he had wanted to turn Italians into warriors. Xi Jinping is doing the same.

Jordan Schneider: Why is that idea so seductive?

Edward Luttwak: Well, for obvious reasons. Before you had nowhere to live. Now, you have at least a decent apartment all over China. There are very few people who are still living homeless. They exist, but they’re few. I’ve been to all the peripheries of China, remote peripheries, although not last year, but over the years. There are plenty of people living in hollows, and caves and so on.

Now, you have a place to live. Food is not a problem unless, of course, you start a war with Taiwan and so on. All the food in the world, so much food that Shanghai people protested when under lockdown because the food hampers they got from the municipality were not good. Well, if they had given them to the Chinese throughout history, until a few years ago, they would have been blessing the municipality, crying in their emotion of how much food they were getting.

Now, they said they were starving. Starving because they didn’t have things like yogurt, which did not exist in China at all before. When I was in China, under Mao, milk was available on a limited basis only for children. Naturally, there was no yogurt. The yogurt didn’t exist as a product. Yogurt was known to the Chinese as something that the barbarians were drinking. Smelly thing, a horrible smelly thing, who wants that? People ate rice, wheat, and sorghum.

In those days, under Mao, there were still families. There were grandfathers and sons, and they could be in one very small place in a hutong in Beijing. You were in Beijing, you know the hutongs? There are a few of them being preserved. It was all hutongs. Courtyard houses, and a family would have a room facing the courtyard. They might have two rooms or one and a half rooms. In that family group, where there might be a grandfather, one chicken a week, that’s meat. The rest is just cereals.

Everybody must buy up cabbage when it gets distributed in the late summer and so on. You have to dry it on the balconies or wherever you can. Otherwise, if you didn’t have cabbage, you would not survive the winter. Otherwise, there’s going to be rice and wheat. That’s it.

The vegetables that are available in the summer would no longer be available from all the farms around Beijing that were fertilized with human waste — nightsoil, as they called it — causing the whole city to smell like a toilet. All of Beijing smelled like a toilet because of that, because they were carrying nightsoil in carts. That was their economy.

Now, all of this has gone. There’s prosperity. Now, the question is, “Okay, what else can we do? Well, we can build the fleet. We can challenge,” and so on. Now, they’re not building an army. The army is under one million. Their deployment of about 120,000 or so in Tibet to face the Indians is a really big strain for them. Most of the borders are unguarded, but they’re building up the navy.

There are all kinds of problems for the US Navy. The US Naval Sea Systems Command makes it impossible to build a fleet, because they elaborate and overelaborate and triple-evaluate every damn ship. Naval Sea Systems Command is a cult dedicated to perfectionism in a single ship that costs so much that you can’t have a flotilla and so on. We have all kinds of problems, but the Chinese can’t fight.

Jordan Schneider: You talked a little bit about the edges that autocracies have in your book with being able to have operational surprise and so on.

Edward Luttwak: They can launch a surprise attack.

Jordan Schneider: What do democracies still have going for them?

Edward Luttwak: Well, democracies have historically done very well. Autocracies don’t have a mechanism to correct mistakes. Xi Jinping wants aircraft carriers, even though aircraft carriers as a collective are becoming obsolete. China doesn’t need them at all, because they can dominate the space around China with missiles.

What democracy is going for itself is much more initiative at every level and the ability to have true enthusiasm through dedication. When you do things under orders, you don’t manifest it, you lose the capacity for the actual enthusiastic individual response, which doesn’t just want to look doing the right thing. The Chinese are constantly striving to appear to be doing the right thing. In a democracy, you actually care to do the right thing, you want to succeed in doing it, and so on, so forth, not to appear to be doing the right thing.

There are no fierce parades in Israel. The Israeli army doesn’t parade going up and down and all that stuff. Only when they’re called to war do they come. These reservists, some of them came from mansions in Silicon Valley. People came from mansions in Silicon Valley, who were not called, and who ended up using their influence to elbow themselves into a unit to be able to fight and so on. You don’t get it in autocracies.

Jordan Schneider: We started the conversation talking about civil servants and bureaucracies. Can you pick three over the course of human history that you would enjoy working in, or being a fly on the wall for?

Edward Luttwak: I had the brief dip into the 1967 war, and I had a brief dip into the 1973 war. The one thing I would have liked — because after ’67, I was working with military intelligence. Not spying around the world, but military intelligence. Classical. I wish I had remained in Israel ’67, and being in military intelligence, and then being able to avoid the October 1973 war, surprise, as a personal achievement even though, as it turns out, it was a key to the 1973 war because it was a brilliant Israeli counteroffensive, but the Egyptians had achieved their victory before the counteroffensive — a period of victory before they were defeated. That opened the door to peace.

If I stayed in Israel between ’67 and ’73, I would have had great, very exciting and important things to do, and avoiding the surprise of 1973, therefore avoiding the initial Egyptian victory, and only have an Israeli victory, and then Israel wouldn’t have peace with Egypt. My entire activity would have been highly harmful.

It was the particular officer, whom I happen to know, who mistakenly believed that Egyptians would not attack in October ’73, that allowed them to have that victory, which allowed diplomacy then in Kissinger and so on, to reach peace through them having a satisfaction of having won a victory, even if it only lasted for a week or so. Yes, so that’s what I would like to do. However harmful, destructive, yes.

Jordan Schneider: The idea with this question is that we’re imagining a world where you can snap your fingers, and you can be a ghost and watch history.

Edward Luttwak: That would have been no fun at all. I was in North Borneo briefly for the campaign there. I would have very much liked to have been in Southeast Asia during the period when the Dutch acquired their Indonesian archipelago, and the British had Sarawak and Brunei.

I love boats. See, that’s another thing. I like cows. I love cows. I have a ranch. I still have cows, but I love boats. I did anti-piracy in Indonesian waters on a sustained basis when I was 60 or so, 65. I would have liked to have been in that period when the Dutch and the British were fighting and exploring islands, because I did have the experience of going with a motorsailer, hunting pirates and landing in a different island every other day. Some were Hindu, some were pagan, some were Muslim, some were piratical, others — Many of them didn’t have an airport, an airfield. No airfield and no dock. They could only be visited by, like we did, with the motorsailer and the dinghy.

I would have liked those colonial wars, the Dutch and British fighting it out in that environment, because it’s so beautiful, and the war was so purposeful. It was to lay your hands on these specific islands that produced specific spices that were sold. They were very profitable. It was a highly rational war, war to make money, fought in a beautiful environment. Of course, with no headquarters above you to give you orders because of no communications.

Who’s Who?

Jordan Schneider: I’m going to give you a contemporary leader, and I want to hear who you think is the analogous person from history, either ancient or modern, that first comes to mind. First — Trump.

Edward Luttwak: Oh, well, Trump is Cleon. Pericles had a rival in the Greek assembly, Cleon, who was a vulgar guy with a very, very powerful voice. He thundered. Pericles didn’t have his volume. He would always attack Pericles because of things like his mistress and things like that. Pericles would try to explain to the assembly the politics of the war, the necessity of the war, the strategic context, and how we must act in this and that. Cleon would come with a simple, “Let’s go and kill all of those guys there.”

Trump is Cleon. He is the populist with a loud voice, plausible arguments, as opposed to Pericles, who explains the reasons to the assembly and so on. Also, Cleon greatly increased the number of Greeks who served on juries, because they got the daily dough, a small amount, a small coin with which a couple of people could eat for a day or something.

Trump is Cleon, definitely Cleon.

Jordan Schneider: Netanyahu?

Edward Luttwak: Netanyahu would be Cincinnatus. Very much Cincinnatus. Netanyahu was at Boston Consulting Group (BCG) with his pal, Mitt Romney. Romney begged him to wait a couple of years, and then you become a millionaire, and then you can go back to Israel and plunge into Israeli politics, trying to do something.

Netanyahu actually consulted me, came to this house, sat on my deck, wanting to be prime minister. I said, “Look, you’re a great television celebrity,” because he had been defending Israel at the UN. He was on television all the time. “Go back to Israel. All the politicians will wait to eat you up and devour you. You go back, ignore them in Tel Aviv, and get a little car and go and visit all the branches of the Likud party.”

The branches are in the back of a gas station. There will be a few old guys showing up. That’s the branch. “Patiently go from north in Betula to a lot in the south and talk to them, and they will all have met the television celebrity, Netanyahu.”

“Then, after you visited all the branches in every little place, then wait for the party meeting, the annual meeting, and all these people who have met you, all of them had told all their friends that you’re actually their friend, how Bibi told me this, I said to them that, and so on and so forth,” and he won. Instead of being eaten alive by the other established politicians, he was there.

By that point in time, before going to the United States, going to MIT, going to BCG, he had served five years in the army. The military service at the time was actually two and a half years. He served for five years because he signed up for an elite unit. Because of that, he was in combat even between wars. Every other month, he got wounded. Then, he goes to MIT to study business and so on. He’s about to start making big money, then he leaves it to plunge into politics.

He’s Cincinnatus. He has many other things, because remaining in power, people degenerate, obviously. He is not the Netanyahu that first ventured, courageously and cleverly, actually, because many other people had tried to do what he did, to go from international celebrity to becoming an important politician, but he succeeded.

Then, just by staying in power, you degenerate, your mind becomes blunter, and you outlive your talent by staying in power. He is, to me, a Cincinnatus.

Jordan Schneider: What about Xi?

Edward Luttwak: Xi? Well, the easiest explanation is Stockholm syndrome. When Xi came to power, Mao had been sidelined. The portrait remained in Tiananmen, but Mao was out. Mao had killed 60 million Chinese with his harebrained schemes and his madness and his cruelty. He had killed all his colleagues in the party.

He killed Liu Shaoqi, whom I met when I was a very young person in Romania in 1964. I was invited to dinner because I was with the television team, interviewing the president of Romania, the boss. He had Mikoyan and Liu Shaoqi, because Romania was independent or something. I met Liu Shaoqi at a long evening dinner. When Liu Shaoqi complained about the Great Leap Forward and the murder of all these people, he ended up in prison. The Red Guards put him in prison without insulin, and he died there. Mao, to me, was a maniacal character.

Xi Jinping is a total victim of Mao, because he was living in Zhongnanhai in a mansion in the heart of Beijing with his father, who was supposedly Zhou Enlai’s deputy. In reality, he was the party’s publisher. He published books and journals for the party. He had published a book about a character, long forgotten at the time, who had quarreled with Mao. When he published a biography of this great communist leader, Mao didn’t like it.

Mao sent him away. He wasn’t shot, he wasn’t killed. He was exiled. He was sent to prison. Xi Jinping, along with his two half-sisters, gets tossed out of their beautiful mansion. He and his mother are all crowded in one room in some horrible apartment house while the father is in prison.

Periodically, he’s brought back to Beijing to walk through the streets with a placard saying he’s a counterrevolutionary, da-da-da, so people could pummel him and beat him. The mother had to go along with him in these things. One of his half-sisters died of hunger or committed suicide. It is not clear. The other half-sister, who then bought a mansion in Hong Kong decades later for maybe $150 million, was set to work making bricks with their bare hands, mud bricks to be baked for five years. Only survived because the communist party leader from Mongolia, who was called the King of Mongolia, kind of thing, he was very high-handed, and he periodically would send somebody to bring the food.

He is sent to the countryside, as everybody knows, in a house with no windows, dug into a mountainside, in a horrible place in Shanxi. A really horrible, treeless hills, an ugly village, primitive, dirty, with very little to eat. He, who had grown up in a house full of books because his father was the party publisher, had only one book with him, a translation of Goethe’s The Sorrows of Young Werther, which he quickly changed for Faust, which is very appropriate.

He read the Chinese translation of Faust, written, by the way, by Faust, translated by a Faustian character, whom I actually met, whose name was Guo Moruo (郭沫若). Guo Moruo had survived the Cultural Revolution because when the railroads came, he had already written a screed saying that everything in Britain was counterrevolutionary. They couldn’t force him to apologize for anything, because he apologized himself. Also, because the Red Guards grabbed his two sons, and he enthusiastically joined in accusing them of being counterrevolutionaries, both of them were killed.

When I met him, because he had shown such loyalty to Mao, he was restored to his elegant mansion, but there was some servant lurking in the back, and he had this vase that he was very proud of, antiques and so on.

He reads Faust in a village only in daylight. There was no electricity to read at night. He suffered because of Mao terribly, most terribly for 18 years. He ought to hate, hate, hate Mao, but it’s Stockholm syndrome. Instead of hating Mao, he adores Mao, and he keeps exhorting Chinese people to read this Mao thing about that he wrote in the caves of Yan’an about protracted war, and this and that. He elevates the cult of Mao. This is Stockholm syndrome.

The man is sick, deeply sick to celebrate, the person who imprisoned his father, humiliated his father, repeatedly. His mother used to walk alongside the father with a placard, and people would call her names and everything else, push her, shove her. She would fall to the ground. She’d pick herself up. She got up again. Otherwise, people would have walked over and killed her.

For him to worship Mao is deeply sick, but it is the so-called Stockholm syndrome. You want to propitiate this character. It’s a tragic thing that China is in the hands of somebody who has a historical neurosis.

Jordan Schneider: Let’s do Biden briefly.

Edward Luttwak: I’ve known Biden. You’re talking now about somebody I know quite well. If you go online and you put my name and his name, you’ll see that he many times invited me to testify before the Senate Foreign Relations Committee. I met him much earlier. I was introduced to Biden when I first arrived in Washington.

Very early on, I went to see the famous Speaker of the House, Tip O’Neill, who was a wonderful man. A big, huge Irishman who was a wonderful guy, who told the best jokes.

The next thing that happens, Biden arrives. Tip O’Neill is a big, old guy. Biden was just elected. I met him when he was just elected, just before he lost his wife and child in the car accident. He was incredibly young, and incredibly friendly and everything else you want. Then, we had some exchange, some words.

Then much later, I lost touch with him. I had no contact with him, really, until he became Chairman of the Senate Foreign Relations Committee. Then, he calls me and he says, “I remember you. Tip O’Neill introduced us.” He had me testify to various things. Some of this testimony is on C-SPAN. Then, he would invite me all the time.

I know him well. I have lost a lot of my short-term memory. He has lost a lot more than I have. The one thing he has — he understands foreign policy. He understands foreign policy really well. The problem is that there are no Bidenites. All the Bidenites are retired or dead. The people who staff him are Obama people, who are deeply unsympathetic to Biden’s fundamental ideas.

I visited Saudi Arabia just six days before his arrival in Jeddah to meet the various princes, including the prince, Mohammed bin Salman. I asked the foreign minister. The foreign minister received me, and we had a long talk. I said to him, “What is the agenda? Where is the agenda of the meeting? Who does what?” and so on. “No agenda.” The White House staff — these Obama people, disloyal to the last minute — were trying to sabotage the visit because they wanted him to punch Mohammed bin Salman and not to greet him. They held up the agenda, the staff people.

The Biden you saw functioning in the world is a combination of Biden’s own ideas and everything else, but distorted and deformed by his people. For example, there was the case of Robert Malley, the fanatical opponent of Saudi Arabia and of Israel. Obama sicced him on Biden and forced him to have Malley as his Iran coordinator. The guy was in continuous touch with the Iranian regime under the table and got caught.

Biden with no Bidenites — it’s a tragedy, because Biden is always right. For example, I remember when he was vice president, everybody ignored him, ridiculed him. Ignored him, for sure, but also ridiculed him. Early on, the vice president says, “The Afghan army is not the real army, because the Afghan nation doesn’t exist. You could have Uzbek regiments and Tajik regiments, whatever, but you can’t have an Afghan army.” You get all these briefings by people like Petraeus and so on and says, “It’s a put-up job. They’re just doing it for the salary. They will never fight, because you can’t have an army without a nation and there’s no nation.”

He was totally right. He was ignored. The people who ignored him, sneered at him, and made fun of him at Georgetown dinner parties went on to serve in his administration, because there’s nobody else. The Democrats don’t have other people.

Jordan Schneider: Let’s close on a few more books. What titles would you recommend to aspiring historians and strategists?

Edward Luttwak: I mentioned the British official history of the strategic bombing offensive against Germany. It was a fantastic piece of work with all the other things on top. That would be a very important book.

Then, of course, Clausewitz. Clausewitz had it all. Since he died and the book was put together after his death, you can’t actually read it through. People tried to read it through and give up in frustration. I understand that.

When you have a single subject, go and look because he has many different subjects about different forms of warfare. When it is a natural thing that you are focusing on and you see all around, then you’ll see how much you get from him. I got from him the levels of war, tactical war. I got from him the constant dynamic of action and reaction, the flow and the backflow, and how no action in war can happen from the conception to execution, because halfway through, you meet the enemy. Then, he maneuvers against you, maneuver against him, so there’s no linearity and so on. I would say rereading Clausewitz whenever specific issues call for deep reflection, will be that.

Then, of course, there is the greatest of all the Roman authors who should be read cover to cover but beginning with the histories. He wrote the books. He wrote many things. What survives is The Annals and The Histories. That is Tacitus. The prose of Tacitus is such that every single phrase was carefully composed by him as an epigrammatic, memorable phrase.

Here’s the one, for example, they made a solitude and called it peace. Some Scottish chieftains said the Romans arrived to kill everybody, and they call it Pax Romana, something like that. It’s epigrammatic, but there’s a deep, deep level — he wrote it after having been a civil servant and imperial functionary. The Annals of Tacitus, which are a history of Rome under Tiberius and so on.

The histories, which is the terrible year of the four emperors when Nero was killed. Then, they found this worthy senator in Spain who becomes the emperor. Then, Vitellius, who is this Roman profligate, becomes emperor. Then eventually, Vespasian is the one who wins, because he just defeated the Jews in the Jewish war, comes back as the war-winning general and becomes emperor.

Once you’ve read that, you can pick up and read History of the Peloponnesian War. If you read these basic books thoroughly and seriously and put them down if they don’t grip you and pick them up again when they can grip you, then these books will get you there 95% of the way. They really will. They maintain this, they’re a celebrity.

Thucydides, notoriously everywhere. Tacitus, who is less quoted, is fantastic.

Jordan Schneider: What are you excited to learn about next?

Edward Luttwak: Well, now, actually, I’m doing what everybody else is doing. I’m not being original at all, because I’m trying to understand how the current wave of technology will play out, which is the fact of having the digital culture going on steroids with artificial intelligence and how this interacts and works.

I had a practical thing about — I was talking to a company that offers a new satellite service and so on. They’re having trouble, because their service is really far superior, but they can’t sell it. I said, “Look, fellas. You produce images but when a government buys images, it doesn’t have to have a single image. When you buy a rifle, the soldier only has one rifle.”

Now, you have proliferating companies offering images, of course, mostly radar, but still many optical, of every different kinds, producing many other things. Also, with artificial intelligence, you can instantaneously recompose every single photograph of any part of the world taken at any time by directing it to collect selectively something or other.

I suddenly realized how the most elementary form of artificial intelligence, not the forms where you fake a whole personality and all that. No, the most elementary machine learning, simple machine learning, which is assembling together all the cats and all the dogs, really can transform things like the entire satellite business, which is connected with instant coverage, the impossibility of maneuver, because there’s no surprise, and all the rest of it, and so on. That’s what I’m thinking about.

Jordan Schneider: We talked earlier about there are some technological surprises, they wash out pretty fast. There’s some you mentioned in the book, strategic targeted bombing and the tank, where all of a sudden, we’re in a new world.

Edward Luttwak: Artificial intelligence could be a big one because of this re-composition fact. The fact that you can really throw data in a hopper and then in a very simple way, line up all the cats and all the dogs and so on. Intelligence, one, is very important.

Secondly, the fact that you can add interfacial intelligence controllers to a handgun, to a cannon, to a tank, to airplanes. You can do it. For example, as of now, as of today, there’s no reason whatsoever why a United Airlines flight from a specific hard spot at an airport to another hard stand at another airport needs pilots. Removing pilots would just remove opportunities for pilot error. Why can it be done? Because, in addition to things like inertial navigation that we once had, you can actually have an artificial intelligence overlay that continuously reevaluates.

In other words, you don’t just have a series of electronic gizmos functioning in series, but you can also have, in fact, an artificial intelligence that checks, taps and questions and says, “Oh, the altimeter says it’s 800, but are we really at 800?” and things like that. The applications for civil aviation are obvious, considering the fact that they want to sell autonomous cars that have to drive around the streets, irregular streets, where there are children in bicycles and dogs running across, all kinds of stuff, and you want to go from A to B in San Francisco without a driver, well, if that is true, you can certainly go through the neutral space of air. Air only has objects that your radar can detect. You don’t have children darting out of alleys with a bicycle. Then, you can see the potential of existing artificial intelligence and not speculative enhancements.

For example, civil aviation. Pilots add nothing to artificial intelligence, because remember, you’re starting from a hard spot, you land in a hard spot, and in between, it’s only air. Even if the air is occupied by birds or by other airplanes, you can definitely avoid them. If anybody’s talking about having cars running around San Francisco, it must mean that we should have pilots.

Jordan Schneider: You should try to ride in one of those the next time you go. It’s a cool experience. I felt way more in danger as soon as I got a normal Uber right afterwards, because the Waymo is never going to break the law. Your normal driver will brake too hard or speed or run a red light.

Edward Luttwak: I always drive too fast, and I brake hard. I enjoy doing that. I hate smooth rides.

Jordan Schneider: All right. Last one for you. Would you mind talking about your relationship to Judaism over these years?

Edward Luttwak: In Palermo, there were no Jews. My father had a standard, basic Jewish education, because he knew Hebrew well and a bit of Talmud and so on. Then, I went to a Jewish boarding school where they were formally teaching Hebrew and religion and so on. It was what you would call a modern orthodox thing. They were big on, of course, Judaism and Hebrew and all that stuff.

Now, I am not a theist personally. Dalya, my wife, loves biblical literature. I’m still fascinated when I read the actual Bible — the real Bible, not the New Testament. From my point of view, it’s not the real Bible at all. I’m fascinated by all the intricacies and the stories and so on. The fact that it’s all very elemental, these were people who were fighting wars and all this other stuff, and they were herding animals, and there were disputes over water rights and things, I love that fact.

The Christian trade is that if you are a good Christian, you will go to heaven. Now, the Jewish trade is if you are a good Jew, you will have served God who made you already. There is no promise of going to heaven. I love that.

In Christianity, there are elaborate descriptions of heaven, about all the different comforts and pleasures. Islam adds fountains and many other things as you know. Their heaven is very, very specific. Don’t think about your life now. If you die in jihad, you go to this heaven. They describe the heaven in great detail with all kinds of accoutrements. Jewish heaven isn’t a heaven really, not mentioned.

You have to follow the rules of Judaism because you’re made by God. Therefore, you have to be grateful to God, you have to do it, and so on. There’s no heaven involved. There is a promise in Judaism, and that’s not personal, not to you as an individual. There is a promise that other nations will come and go, and you will not. Other nations will arrive. By the time these texts were written, the Jews were aware of the Egyptian civilization and the pharaonic civilization. Then of course, came the Assyrians, the Babylonians, and then everybody thought they’d be on top, the Persians, who were friendly.

Of course, they dealt with the Hellenistic rulers. The Jewish festival of Hanukkah celebrates the revolt against the Hellenistic ruler of Jerusalem, Antiochus Epiphanes IV, and so on and so forth. The Jewish province is to give it to Jacob when he changes his name to Israel is, “Other nations will come, other nations will go. You will continue.” It is a collective promise.

Because it’s a lack of promise, one of God’s commandments in Hebrew is Pru U’rvu, multiply. I feel that very much. That’s why Abisha had 10 or 12 grandchildren.

Judaism is actually a religion that makes no individual promises at all. Only a collective one. I believe in the fact that given the history to date, the correct attitude of Jews is the attitude that Natan Sharansky had in Russia.

Sharansky was brought up knowing nothing about Judaism whatsoever. In 1967, the other 80 nationalities in the Soviet Union remained quiet, and the Jews went on Red Square and waved a homemade Israeli flag saying, “We want to go to Israel.” The Russians couldn’t believe it. The KGB, initially, anybody who wanted to leave, they gave them immediately a visa, because they were sure there was only a small number of crazy troublemakers, and all the other Jews love it in the Soviet Union. That was phase one, when they all let them free.

Sharansky gets arrested late in the game. When he gets arrested, Sharansky says, “Listen, you’re arresting me. I accept that you’re going to put me in a cell and all that, but you have to realize that the Soviet Union will not last. I might die of pneumonia or something, but if not, you’re serving a system that is going to die and disappear.” He was convinced of that.

I, working for that assessment, was convinced that I would outlive the Soviet Union at a certain specific moment. In fact, I wrote a book which came under this foolish, misleading title, The Grand Strategy of the Soviet Union. That book came out at a time when nobody had any consciousness of the existence of the Kazakhs, the Uzbek, the Tajiks, and all these nationalities.

My book is the first one that was written about them and said that instead of becoming Sovietized, they’re becoming more and more Kazakhs. I can tell that from the census, because in the census answers, what you speak at home, the percentage that said, “I speak my language at home,” rises from census to census. I said, “It’s going to be the end.”

Zhang Youxia 张又侠 has fallen. We thought he would be the last man standing, but instead, he is a “tiger blocking the road” who “seriously fueled threats to the Party’s absolute leadership.” Xi had already purged more CMC members than Mao ever did, but this round of expulsions is distinct from mere anti-corruption housekeeping.

To discuss what makes this purge unique, ChinaTalk sat down with Jon Czin, a former China analyst at the CIA who served as China Director on Biden’s NSC and now works at the Brookings Institution. You can check out Jon’s previous ChinaTalk appearances here and here.

We discuss…

• Zhang Youxia’s long personal relationship with Xi, and how it could have soured,

• The WSJ’s bombshell report claiming that Zhang leaked information about China’s nuclear weapons to the USA,

• Why corruption alone can’t explain Zhang’s fate and the uniquely harsh methods of discipline Xi chose to use,

• Why Xi could be getting paranoid, and what this means for succession plans,

• Whether Zhang was purged because he stood up against Xi’s Taiwan invasion plans

Listen now on your favorite podcast app.

What Just Happened

Jordan Schneider: Zhang Youxia had a rough week. Jon, where do we begin?

Jon Czin: A lot of people in the China-watching community were frankly astonished that the rumors accumulating last week were real this time around — that Zhang Youxia was actually in trouble. And not just Zhang Youxia. His takedown has somewhat overshadowed the demise of Liu Zhenli 刘振立, who was running the Joint Staff Department. That’s another CMC member leaving the Central Military Commission, which now has just two members: Xi Jinping, of course, and Zhang Shengmin 張升民, who ironically runs the Discipline Inspection Commission — the chief internal investigator for all these anti-corruption campaigns.

Jordan Schneider: “Ironically” might not be the right word here, Jon.

Jon Czin: That’s fair. Maybe “tellingly” is better. This is a pretty remarkable moment in Chinese politics — it’s not an overstatement to call it Shakespearean. The few facts we do know are quite dramatic, even without the embroidery of speculation and rumors from the last few days.

We know their fathers served together in China’s civil war. We know there was some kind of nexus between Xi and Zhang Youxia — and that’s not just historic. Xi kept Zhang around at the last Party Congress even though he had exceeded the retirement age. That alone was quite telling.

To my mind, this represents a qualitative leap. Xi started his term by going after his enemies. In his third term, he started going after associates — kind of like a mafia boss, seeing these guys as disposable. He made them, he could break them. But now he’s going after his friends, or at least his political allies in his innermost circle. It’s one thing to be cruel to your enemies. It’s qualitatively different to be pitiless with your friends.

Jordan Schneider: Let’s underline that. The fact that Zhang was kept on despite age limits — this is one of the few guys who actually has battlefield experience. The signal you send when you bend the rules for someone is that you trust them and believe they’re essential, and that having some 59-year-old who’s next in line would be a mistake for the party.

Xi has done very little of this age-bending. We always make bets before the Party Congresses, and over the past few, it’s been remarkable how few people he’s kept around. To go from that level of trust, let Zhang survive the purges we emergency-podcasted about three months ago, and then over the last three months decide, “Sorry, dude, you’re getting caught up in this too” — that’s a remarkable series of events.

And that’s setting aside all the rumors about selling nuclear secrets to America, which we’ll get into later. But Jon, why don’t you talk through the delta between where we were in the last purge round and what this potentially indicates?

Jon Czin: What we saw last time was back in the fall, which really punctuated a lot of what had already gotten underway. You need a Party plenum to formally purge people from the Central Committee. The most conspicuous was He Weidong, the other CMC Vice Chairman. Several other figures also went down, including Central Committee members — some of whom had been missing, some who were then absent from that plenum. Then you had PLA officers who were alternates, potentially next in queue for elevation to the Central Committee, who were also passed over.

It was already breathtaking as of last summer. That’s what John Culver and I wrote about — this was already on par with the Mao era or the post-Yan’an era. Now we’ve gone one step further.

The Zhang case is significant in itself, but a lot of people are getting hung up on just that one case. This is part of a longer storyline and a broader phenomenon. There’s speculation about why Xi went after Zhang at this moment, but the main takeaway is: we don’t actually know.

More importantly, this is a generational turnover. A whole generational cohort has been virtually decapitated. What it suggests is that Xi was fed up with the whole crop of leaders for whatever reason — possibly different reasons for different people. But he clearly determined at some point, “I don’t like this crop, and I’ve got to get rid of them wholesale.”

When we look at the People’s Daily editorial about this, it’s important to take it with a grain of salt. But I’m increasingly wondering, should we be reading it both literally and seriously? They talk about corruption. They talk about these guys trampling upon the Chairman Responsibility System (“嚴重踐踏破壞軍委主席負責制”), which is how Xi controls the PLA.

Clearly, there was some corruption issue. As we all know, that’s usually the pretext — all these guys have their hand in the till at some point, given how the PLA has functioned over the last 30 years. There’s always a convenient pretext to take down anyone. That means there was a political issue we don’t know about. The wording in that document was so harsh — they said it “challenged the foundation of the party’s control of the military 嚴重助長影響黨對軍隊絕對領導.”

Jordan Schneider: Let’s do a little spin-doctoring here. Getting the Wall Street Journal to write an article saying this guy sold nuclear secrets to America — that was a choice. I’m not saying Lingling Wei made it up, but someone had to tell her. And you don’t tell that to Lingling and keep your head unless you’re being told it’s okay to tell her. Presumably.

Jon Czin: Presumably. Or it’s clear that this guy has already gone down. The dearth of information just feeds these rumors. It’s not just that people in Washington or New York are trying to grapple with what happened without clear insight — this is a very opaque, heavily stovepiped system. It’s entirely plausible, probably likely, that a lot of people inside the system don’t really know what actually happened. An investigation of the ranking Vice Chairman of the Central Military Commission must have been conducted in great secrecy with a very small circle. A lot of us on this side of the Pacific were surprised, and we should approach this with humility — but in fairness, Dungan himself might have been surprised.

Jordan Schneider: Let’s play media criticism for a second, because I’ve gotten many texts about Lingling’s article. It says:

“China’s senior-most general is accused of leaking information about the country’s nuclear-weapons program to the U.S. and accepting bribes for official acts, including the promotion of an officer to defense minister, said people familiar with a high-level briefing on the allegations.”

…

“The most shocking allegation disclosed during the closed-door briefing, the people said, was that Zhang had leaked core technical data on China’s nuclear weapons to the U.S.”

In the past, we’ve seen this game played in reverse — the US intelligence community rattling China by saying things like, “We knew there was water in your missiles,” as a shot across the bow. Now, with Lingling’s sourcing and those two lines, it’s pretty clear this isn’t coming from the US intelligence community. She’s getting this from contacts in China, whom she has every right to believe have enough information to tell her something like that.

When people tell things to Lingling, it’s both to communicate to the world and to communicate to the rest of the Chinese system. Jon, let’s game it out: who gains, and what’s the messaging upside from portraying Zhang Youxia as someone who committed high treason — not just corruption, but high treason?

Jon Czin: The gain is you’re really putting a nail in his political coffin. Maybe people weren’t officially sanctioned to tell Lingling this, but the fact that this is floating around means it’s safe to talk about him in these terms — as traitorous. It’s safe to smear the guy who just days ago was the most powerful military officer of his generation.

This gets lost sometimes: it’s not just the formality of being purged. Before the purge comes, you’re disgraced for your disloyalty to the party — and in this instance, to the country as well. It’s full bore.

What’s really striking is the timing. We’re about 20 months away from a Party Congress. Xi could just as easily have let Zhang Youxia retire quietly, even if there were a real issue.

Jordan Schneider: Say he had a heart attack. Whatever.

Jon Czin: Exactly. Give him worse housing in Zhongnanhai, dock his pension, whatever — just quietly neutralize him.

Jordan Schneider: Tell him to take a hike and go play mahjong. There are ways to play this game that aren’t quite as dramatic.

It comes back to your generational cutoff point — Xi is just done with all these people. But here’s the problem — if this was your boy, the guy you wanted to ride off into your late 70s with, are you suddenly going to take to some hotshot 58-year-old?

Jon Czin: Who wants this job? It can’t be good for morale on their side. If you look one level down from the Central Military Commission, a lot of people at the theater command grade have themselves been ousted during these purge rounds. There are still some people floating around, and it bears further analysis about who might still be in the running — who’s young enough with the right credentials and grade to be elevated to the CMC. You’re going to need some people up there, now that it’s basically a tandem bike.

Jordan Schneider: Or will you? Is this just an institution that might go by the wayside? What does that path look like?

Jon Czin: The Central Military Commission is the party’s supreme military body. For the uninitiated, the PLA is actually the armed wing of the Chinese Communist Party, not a national military. That’s a wonky, esoteric distinction, but imagine if, when the Democratic or Republican Party came to power, they had their own military wing loyal to them rather than to the government. That’s been the case since the Communists took control of the country in 1949.

You can see it in the PLA editorial, but also on a regular basis — there’s a constant cadence in the official military press that job number one is loyalty to the party. That is really the top priority, especially for someone like Xi Jinping.

The Central Military Commission is how the party exercises its control. The key point to emphasize — it’s the only locus of civilian control over the military. Xi is the only person who bridges both parts of the system. There are no other civilians on it. The only time you get a civilian on the CMC is when there’s an heir apparent — they started doing this in the 1980s under Deng Xiaoping, building up prospective successors by creating the Vice Chairman position. That position hasn’t been filled since Xi took the top job in 2012. Everyone else is uniformed.

When you’re talking about party-army relations, there’s no equivalent of Senate Armed Services Committee staffers with deep knowledge of the military. There are no think tankers who are military experts to scrutinize what the military is up to. There’s nothing like the Office of the Secretary of Defense, which is populated largely by civilians to oversee the Pentagon bureaucracy.

The PLA is a high-tech, culturally opaque organization — really an empire unto itself within the Chinese Communist Party. That’s why Xi has been so relentless in puncturing its bureaucratic insularity, constantly mowing the grass and removing people to ensure he gets his arms around it. It’s quite challenging, especially since they’re so heavily resourced.

Jordan Schneider: Imagine being Zhang Shengmin. How does it work? Does Xi say this guy’s got to go, or does Zhang present the docket saying, “It’s either me or him, you better trust me — I’ve found you some rotten fish in the past”? Do you have any historical insight into these investigations?

Jon Czin: The truth is, it probably depends. My guess is Xi probably has some kind of dossier on all these guys. That’s why the Discipline Inspection Commissions are so important — that’s Zhang Shengmin’s job in particular.

Jordan Schneider: Have the menus prepared for anyone and everyone, and then Xi slips over the card when he feels like it. That makes more sense.

Jon Czin: My understanding is that’s a feature, not a bug, of the communist system. This is how you maintain control over a party with a bigger population than Germany — over 90 million people. You constantly have leverage, constantly have something hanging over everyone’s head. Everybody’s vulnerable. The Discipline Inspection Commission has everybody’s permanent record for the entirety of their careers — every error, every demerit, every stupid thing you’ve done is watched.

It’s unclear exactly how it works. Using a little imagination, it could take a variety of forms — either a targeted hit or the famous line from Beckett: “Will nobody rid me of this meddlesome priest?” A very unsubtle hint about who needs to go down.

It’s possible it’s bottom-up, but this would have been so delicate and sensitive. Zhang Shengmin, assuming he was involved in this investigation, would in effect have been investigating his boss — even after getting bumped up to be CMC Vice Chairman.

Taiwan Plans and PLA Readiness

Jordan Schneider: Jamestown put out an article doing a deep linguistic dive into some past PLA purge memorabilia and the accusations that came out for Zhang Youxia, basically arguing this was an expression of Xi’s frustration with 2027 Taiwan readiness. What’s your take on that thesis?

Jon Czin: Two thoughts. First, it’s plausible — we just don’t know at this point. There could have been some kind of substantive or policy disagreement. I give our colleagues at Jamestown credit for giving these official announcements a Talmudic reading — very close, very precise. But I’m not personally persuaded there’s enough in the text and nuances they highlighted to make the case that there was truly some kind of substantive difference. I would need more evidence.

Also, in terms of how the party operates and how politics inside that system works: yes, there are policy disagreements, but those are seldom the drivers of something like this. Policy differences are how our system is designed to function — you pick your party or allegiances based on your policy preferences. In the Chinese system, it often runs the other way: you pick your policy preferences based on who you’re affiliated with. If Zhang was close to Xi Jinping, they would have been closely in tandem. We just don’t know how the dynamic played out behind closed doors, but there’s not enough to say this was clearly what was going on between them.

Jordan Schneider: This is a Joseph Torigian point: oftentimes the people who get purged had no intention to cause problems and there was no ill will or scheming. They just read the tea leaves the wrong way unintentionally — they thought what Xi wanted was A, but what he actually wanted was B. Honestly, I put that as a much higher probability than this guy being the highest-ranking American agent this country’s ever pulled off.

Jon Czin: 100%. Joseph’s thinking on this is quite right. The irony for Xi Jinping is that’s exactly what happened to his father when he was toppled in 1962. He was trying to be a loyal soldier, working for Zhou Enlai, trying to do the right thing and be a loyal staffer. He just got on the wrong side of the boss.

That seems more likely in this scenario. It’s not idiosyncratic to Mao — it’s what happened to Hu Yaobang under Deng Xiaoping. Hu Yaobang thought he was in a safe position with Deng, but he had done things that alienated him and desperately tried to repair the relationship, from my understanding. This is how the system works. It seems more likely that Xi thought there was some issue with Zhang than that Zhang Youxia intentionally tried to flout his chief patron and boss, who is a strongman. Even saying it out loud makes it sound increasingly impossible.

Jordan Schneider: You can’t have lasted that long and be this dumb.

Jon Czin: You could always be surprised on that front, but it seems less likely if you had to grade it on a curve.

The Torigian point is something I’ve been grappling with over the last few days, and I’m not sold on it. But if this is more about Xi’s suspicions than any particular thing Zhang did — if there wasn’t any deliberate intent from Zhang Youxia — does that mean Xi is moving into the space of a paranoid dictator?

That’s not really my mental model of Xi Jinping. He’s extremely ruthless, and I’m more inclined to the hypothesis that this is the ultimate illustration of that — he’s willing to go after even close associates if he’s done with them.

That gets to another possibility: maybe Xi was just done with Zhang Youxia. Maybe he used Zhang to prop up his power inside the military, clean house, get rid of other people. When he was done, he could set his sights on Zhang and figure, “I don’t need this aging corrupt guy sitting at the top of the system.” I’m speculating, but that’s plausible.

Jordan Schneider: That gives you another reason to play the “he’s a corrupt traitor” card publicly — if what you’re really trying to do is make clear to the next generation that you’re really serious about this.

Jon Czin: Right.

Jordan Schneider: “By the way, if you haven’t gotten the memo yet from having all your bosses thrown in jail, just you wait — nobody is safe, not even the top guy.” As a narrative-shaping thing, we don’t really have show trials in China, but this is the closest thing we get — these People’s Daily and PLA Daily op-eds saying this guy’s a crook and a terrible person who betrayed the party. To do that in the most dramatic fashion is just another exclamation point.

Jon Czin: That’s entirely possible. It reminds me of this Ben Franklin quote I’ve always liked: “So convenient a thing to be a reasonable creature, since it enables one to find or make a reason for every thing one has a mind to do.” That’s very much how the party rolls in these instances.

Jordan Schneider: It’s interesting they didn’t say “sell to the Japanese.” Have we gotten any of those?

Jon Czin: I don’t think we’ve seen that since 1949.

Jordan Schneider: But if we’re just trying to push a narrative and reinforce that whole thing — or the Taiwanese. It’s almost like the Putin thing: if you’re going to lose the war in Ukraine, you can’t lose it to the Ukrainians, you have to lose it to the Americans. Getting corrupted by the Taiwanese or Japanese is just too embarrassing. You’d never want to tell anyone.

Jon Czin: The CCP would say you can’t be corrupted by the Taiwanese because they’re part of China. But you’re right about the element of contempt. That rumor is a small encapsulation of the fact that the United States looms large as a boogeyman. They have too much contempt for the Taiwanese or even the Japanese to say, “We got played and outmaneuvered by them” — especially on something so sensitive.

Jordan Schneider: It’s been the same whenever they’ve announced electronic hacks they’ve caught. It’s always been Americans, never a different country. Alright, should we talk Taiwan a little bit?

Jon Czin: Sure.

Jordan Schneider: What does this mean for Taiwan contingencies?

Jon Czin: I’ve actually been turning this question on its head. This isn’t the core driver of what’s going on, but Xi’s willingness to totally clean house — renovate the military, strip the high command down to its studs — shows he feels pretty comfortable about the external environment and the cross-strait environment in particular.

There are three big reasons for that. First, President Trump doesn’t seem personally invested in the Taiwan issue. The national defense strategy doesn’t even mention Taiwan, and they’re reading that signal pretty clearly. Second, President Lai Ching-te, whom they loathe, is in political trouble at home after the failed recall campaign this summer. There’s going to be an election in 2028, and the opposition KMT’s new leadership is saying very favorable things about Beijing. From their perspective, they’ve got breathing room, and 2028 is probably the next big pivot point where they sense a real opportunity to shape and shift the dynamic.

Again, that’s not a driver, but when Xi is thinking about all this, he probably feels pretty comfortable about the situation.

The other thing to point out: assessing the PLA is always challenging because, yes, there’s deeply rooted corruption, but the modernization effort remains really impressive. This is true of China’s economy and development writ large — there’s real rot, real dysfunction, and real corruption, but also real dynamism. They’re doing real things with actual impressive quality. Both coexist at the same time.

Even in the last few months, just a few weeks after the exclamation mark on the last round of purges at this fall’s plenum, the PLA conducted a pretty significant military exercise around Taiwan in the closing days of 2025. There was this theory floating around that because a bunch of people from the 31st Group Army were purged, they wouldn’t know how to do these things anymore. It’s pretty clear they still know how to do these things, based on the operation they pulled together at the end of last year.

You have to think this is terrible for morale. It’s not how you’d run a high-morale, high-tempo organization in the West. But it’s their system, and this is how they operate.

Jordan Schneider: These generals are a dime a dozen, Jon. As long as they get the ideology right, everything else will fall into place.

Let’s talk about 2028. The election will be in January, which leaves considerable time with a potential KMT leader of Taiwan and a Trump who wants to create peace deals — we’ll see where he lands on war by then. That’s a big window for new deals. What form could reconciliation potentially take?

Jon Czin: The other factor is that Xi will have started his fourth term just a couple of months earlier. We’ll have a party congress in October or November 2027, followed by the Taiwan elections. For Xi, this is part of his mindset going into that moment.

A lot of this will be more about the cross-strait dynamic than the bilateral one. There’s a more theological question in Washington than an empirical one about what Xi wants on Taiwan. My theory is that almost a little more than a decade ago, Xi met with Ma Ying-jeou in Singapore and shook hands — the first meeting of that sort between the two sides since the Marshall Mission in 1946, when Mao met Chiang Kai-shek. Xi obviously loves that kind of historical resonance. Anything that ends with “the first since Mao” is a preferred sentence construction for him.

Jordan Schneider: We’re going to surpass Mao in his purging ability.

Jon Czin: Exactly. Bigger, better, meaner.

What’s important about that Singapore moment is that it established the minimum threshold Xi needs to clear as he thinks about his legacy and his exit from the scene — whether for political reasons if he retires, or just contemplating his mortality in his fourth term.

When he says “we can’t pass this issue on from generation to generation,” that doesn’t necessarily mean he must solve the whole thing before he exits. If he can claim a fig leaf — that things are on the right trajectory and there’s an ongoing political conversation with Taiwan about the status — that would be a win. He’d want more, but it might be enough to satisfy him.

A military contingency would be really costly. The German Marshall Fund report by Bonnie Glaser, Zach Cooper, and others shows this clearly. If you’re at the casino table, this is putting all the chips on the table. For Xi, this is a crisis to avoid rather than an opportunity to be sought.

Jordan Schneider: Imagine that over the next three years, this new cohort of generals — whom Xi doesn’t know at all, has presumably zero interaction with, zero trust in, and who by the way watched him throw all their former bosses in jail — asking him to trust them enough to make the biggest call China has made since splitting with the Soviet Union. It seems really far-fetched.

Jon Czin: Especially because, as a princeling, Xi knows he’s going to get yes-manned. He’s keenly attuned to that. My suspicion is that he’s constantly triangulating information.

This political dynamic extends beyond the military to the party side too. I wrote a piece in September for China Leadership Monitor about what Xi’s fourth term might look like. It’s an extrapolation of his third term — considerable policy continuity alongside operatic drama on the personnel side. That’s likely to continue.

Jordan Schneider: We discussed a few weeks ago what could cause the US-China relationship to go to shit. Domestic personnel changes won’t drive that. But here’s the crazy thing — say Xi has a heart attack tomorrow and there’s just no one running the PLA. That’s a wild moment to be in.

Jon Czin: People underappreciate that on the party side, there is no formal line of succession. There’s nothing like what we have in the Constitution — nothing written down saying that if the General Secretary dies, it goes to the Premier or the President. Those decisions at the top are all made through informal politicking.

Jordan Schneider: Our boy Zhang, Chief Inquisitor, rising to the highest of power.

Jon Czin: Exactly. Torquemada in reverse. I’m sure he has many fans and admirers throughout the PLA.

Xi won’t get rid of the Central Military Commission altogether as an institution. Even during the Cultural Revolution, it continued to exist in name, even if hollowed out. He needs to repopulate it now, and he has a totally free hand to do it. It’s not just about which individual fills which position — it’s also about what institutions are represented at the top. He kicked off the Minister of National Defense and restructured it. As we discussed in the fall, it went from being a normal pyramidal bureaucratic structure to this bizarre diamond shape with conspicuous vacancies.

The only body in China that can appoint new members to the Central Military Commission is a plenum of the Central Committee. I’m watching for rumblings about that happening. Xi effectively skipped a plenum in this political cycle, so he’s got what one of my colleagues calls a “pocket plenum” that he can throw on the calendar. He did this in his second term after he blew up the retirement requirement for the presidency — two plenums in quick succession.

He’ll need something like that because it’s not clear, even as an observer, how the chain of command is supposed to function now. You had the two vice chairmen — one operational (Zhang Youxia) and one political (Zhang Shengmin). Now the chief of the Joint Staff Department is also gone. How is the normal paperwork supposed to flow at the top? Xi has broken many norms in Chinese politics, but he’s still abided by what’s actually written down.

Jordan Schneider: Does Xi have some 42-year-old mishu (秘书 secretary, or literally “secret keeper”) he trusts with this — someone whose dad was in the PLA or who grew up on a military base? Is there a military attaché who runs around with Xi that he would rely on?

Jon Czin: There’s been some reporting and rumors, but it’s not clear who he’s going to trust — not just to repopulate the CMC, but to figure out who’s actually reliable. This is what I start to worry about as we enter the next phase of Xi’s leadership: who is he relying on for advice? Who’s got his ear, especially when this sends such a clear signal to his close circle that nobody is safe?

That’s a big part of the significance here. I want to give a shout-out to one of your Substack followers who called me out for this. I had theorized there were two tiers in Xi’s political universe: if Xi was the center of the solar system, you had people inside the asteroid belt — including Zhang Youxia — who were untouchable, and then people on the outside.

I got a text from a friend the morning after this was announced: “Well, Xi seemed to have nuked his own moon here.” It’s a fair point. We’re all trying to devise mental models about how this operates and why some people go down while others don’t. I had teed this up as a signpost that something had shifted in Chinese politics. Now that we’ve crossed that threshold, it’s pretty clear something has shifted. This is a big deal.

Jordan Schneider: Terry Pegula, owner of the Buffalo Bills, is 74. Xi Jinping, ruler of China, is 72. Terry Pegula just made what the entire Buffalo Bills fandom sees as an absolutely dumb-fuck decision: firing the winningest coach of the past decade in the NFL, apparently because he walked into the locker room and thought the vibes were off after they lost to the Broncos. Five days later he hired the offensive coordinator, Joe Brady, who’s 37 and is in no way, shape, or form going to do a better job than his former boss.

It was funny seeing all the Buffalo Bills insider coverage trying to come up with some 4D chess explanation for what this guy was thinking. Then three days later he does a press conference and it’s clear this is just a very old man who is not thinking all that straight and is throwing darts at the wall. Because he’s the owner, he can do whatever the fuck he wants.

Xi’s going to have to hire some new offensive coordinators for the Taiwan invasion contingency or whatever. We now have a two-generation gap between him and the people he’s hiring. He has no interaction with them, no common ground. He probably thinks they don’t love the party and have never suffered — he looks down on people who didn’t grow up with that Cultural Revolution struggle in them. It’s a really tricky place to be, having no one you can trust besides Wang Huning. That’s a dark place.

Jon Czin: This is what I was getting at earlier: is this the ultimate illustration of Xi’s cold-blooded rationality and unforgiving governance of the PLA, or are we seeing a shift in his leadership style where he’s either more paranoid or showing signs of aging?

Given the broader context, I’m inclined to see this as a deliberate choice, even if not optimal. If he’s making moves like this on a whim, we’re in an even darker place than I thought. I expected more of this in his fourth term, honestly, and the generational turnover dynamic you mentioned will intensify the process. Now that many people from Zhang’s generation and slightly younger have been wiped out in the PLA, everybody’s going to be trying to ingratiate themselves with the boss and push aside their rivals. It’s going to feed that ugly competitive dynamic inside the system.

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On the civilian side, this will intensify in his fourth term as his buddies on the Politburo Standing Committee start to retire — many will have to step down if Xi sticks to those informal age rules in 2027. When Xi looks into that meeting now, the Politburo Standing Committee is all guys he’s known for decades, all his buddies. In a couple of years, they’re all going to look like a bunch of whippersnappers to him.

What I wondered about in that China Leadership Monitor piece is this: the politics and policymaking seem to have operated on parallel tracks so far. There’s policy continuity — you saw it in the Fifth Plenum, you’ll see it in the next Five Year Plan — while all this drama unfolds on the personnel side. The question in my mind, given the nature of Chinese politics, is at what point does the politicking start to infect the policymaking? So far the policymaking seems sanitized and safe from it, as far as we can observe from the outside. But that’s one of the open questions I’m watching for.

Jordan Schneider: We ran some travel journalism on ChinaTalk recently. This guy traveling in Shanxi Province told a story about his friend, a low-level government employee in a medium-sized provincial city. That night they were supposed to have a chill dinner, but his friend had to excuse himself to work, talking nonstop on the phone. What was he doing? Making the rounds, calling dozens of employees within his department to transmit news orally. The memo had come down from above and people needed to be notified immediately.

Why all this secrecy and commotion? His partner explained that this happened semi-regularly — the hushed one-on-one memo dissemination. “Another time this kind of thing happened in recent memory was a few months ago when a three-year-old boy went missing in our city. We had to let everyone know that it was forbidden to report on this issue, no matter what new information you may come across.”

If that’s your life as a low-level provincial employee in Shanxi Province — randomly having to make four hours of phone calls from 11 PM to 3 AM — can you imagine what it means to have a combatant command or to be on the CMC? What your day-to-day headspace is? It’s the stuff of horror movies. Really terrifying.

Jon Czin: The people at the top of the system face this too. Having left government pretty recently, it’s not like Washington, where people will go, go, go at the NSC or State Department as political appointees, then tag out or get voted out of office, cycle through a think tank, and have time to reflect on what they did and what they might want to do in the future. These guys are just going full steam ahead, grinding it out constantly.

Consider someone like Wang Yi, the current foreign minister, who’s also in his 70s now. The last guy who was foreign minister was purged and ousted, never to be heard from again. That’s the system you’re operating under. I have my own theory that Wang Yi probably abetted that process, but still — to be operating in a system where it’s not just about stress but also the stakes.

I put this in my piece right after the plenum last year when all these purges were announced: you’re right to try to imagine how this looks from a party cadre’s perspective. The slog to the top is very challenging — a ton of hard work, a ton of growing an ulcer, and managing these really vicious political dynamics. Then you get to the top of the system and you can just be thrown over that metaphorical cliff on a whim.

Jordan Schneider: It’s like Alex Honnold climbing Taipei 101 at 40 years old. He could fall at any minute.

Maybe there are parts of it that are fun — Honnold likes climbing, and these people probably enjoy doing politics and military stuff. But when you were on the NSC, you weren’t worried that Jake Sullivan was going to throw you in jail for the rest of your life. This is different.

The level of stress and what that must do to your decision-making, how you relate to colleagues, how you operate in the world — aside from frying your brain, you have this extra layer of playing politics with your life in every interaction. That’s a very heavy thing.

Jon Czin: That’s 100% spot on. These are big jobs to begin with, and if you layer over that constant fretting — to circle back to where we started — that’s why it’s such a big deal to get rid of somebody like Zhang Youxia, assuming what we know about their relationship is true and there was some level of trust and confidence. You’re not going to trust just anybody in that system. It’s going to take decades, because you never know if the guy you’re chatting with over a couple of beers is going to sell you out to the Discipline Inspection Commission or tuck it away to use as leverage against you down the road.

That’s the paradox of the system. It’s a low-trust system, so trust is in many ways even more important there than in ours, where we have a high-trust society and polity on the big scale.

Jordan Schneider: It’s not a “no new friends” system — it’s a “no friends, period” system. Do these people talk to their wives or confide in them at all? Maybe, but it’s not like they see them all that much to begin with. Maybe they’re just chatting with DeepSeek, man. They’ve got their AI companions to keep them warm at night.

Jon Czin: Exactly.

Jordan Schneider: Should we curse someone? Who’s getting the ax next?

Jon Czin: Now that I’ve got the reverse Midas touch?

Jordan Schneider: Li Qiang! Totally safe. He’s doing a great job. Five stars. The economy’s cooking.

Jordan Schneider: All right. We’re going to take some of the colorful phrasing from that PLA article and turn it into a song.

Jon Czin: The best line from that article, when they’re talking about corruption in the military: “Three feet of ice doesn’t accumulate in one day” 冰凍三尺非一日之寒. I was thinking about that as I was shoveling out my car yesterday here in Washington, DC.

Jordan Schneider: What’s the takeaway there? Like, “Guys, we’re just doing our job here”?

Jon Czin: That’s not how the system works. It’s not a police procedural where you just follow the facts and follow the money. It’s always politicized. As we were talking about before, they’re corrupt — so it’s just a question of who I want to go after. That’s the mystery. That’s the trillion-dollar question everyone is puzzling over.

Jon Czin of Brookings spent years as a top China analyst at the CIA and served as China Director on Biden’s NSC. He returns to ChinaTalk to review 2025 and forecast 2026. [Recorded before the latest round of purges…see the feed later today for an emergency pod we’re recording together this afternoon]

We discuss:

• Why 2025 has become “the year of living quietly” in US-China relations.

• Trump as “his own China desk officer”: personality, personnel churn, deal psychology, and legacy-thinking.

• China’s “escalate to de-escalate” strategy: rare earth leverage, midterm timing, and a shift from defense to offense that traps Washington in a game of whack-a-mole.

• The “mosh pit” inside the Trump administration: competing factions, ideas that break through by accident, and the absence of a sustained China strategy.

• Why Venezuela, Iran, and covert drama don’t move the needle with Beijing and why the real stakes are in alliances, especially with Japan.

• Chaos Muppets and Double Sixes: a generational theory of why Bush, Clinton, and Trump all embrace(d) chaos, and whether Trump’s incredible streak of luck on high-risk gambles is finally about to run out.

The Strange Calm in US-China Relations

Jordan Schneider: Jon Czin of Brookings, formerly with the IC and Biden’s NSC, returns for our quarterly check-in on US-China relations. It’s been unnervingly quiet, hasn’t it? The rest of the world isn’t quiet — we’re abducting folks and bombing Iran next week — but the US-China front is very placid.

Jon Czin: Surprisingly so. That isn’t what I expected. I assumed that whatever accord we reached back in November, when the two presidents met, would have generated some “stray voltage” by now. As we rounded the corner to the holidays, I was ready to add a meeting between Scott Bessent and He Lifeng in some European capital to my Advent calendar.

Instead, we are in this strange moment. With everything happening globally and domestically, it feels like the beginning of a Western movie where they say, “It’s quiet... too quiet.” As a parent of young children, I fear the silence more than the noise. It forces you to ask: Is something dangerous happening beneath the surface? I don’t believe that’s the case, but this is a rare, fallow moment in the bilateral relationship. It’s a good time to analyze how we got here and where we might be going.

Jordan Schneider: Let’s diagnose this. In the early months of the Trump administration, while Mike Waltz was still around, we thought China would be the fulcrum of Trump 2.0 — the “loud and proud” hawkishness we saw at the end of Trump 1.0. Since then, I’ve done shows on the “death of the China hawks.” Where did the US appetite for this calm originate?

Jon Czin: If you rewind the movie exactly one year, we were in a similar position. We were all geared up for the return of the Trump administration, anticipating Trade War 2.0 and a pugnacious approach. Yet, in January and February of last year, we didn’t get that.

We saw the first two tranches of tariffs against China — ostensibly for fentanyl — but I called that the “Phony War” period. There was diplomacy and skirmishing, but it was just the opening act. The real fight didn’t get underway until “Liberation Day.”

Jordan Schneider: Right. We had a shot across the bow, two rounds of rare earth retaliation and de-escalation, followed by US re-escalation and rare earths again. Now we are in our “Phony War 2” stage — or perhaps a Korean Armistice scenario. Walk us through the rest of 2025.

Jon Czin: After Liberation Day, we saw a dramatic tit-for-tat escalation. I happened to be with Brookings colleagues in China when it happened. We were in Beijing the day before the tariffs dropped, then in Shanghai and Hangzhou afterwards, speaking to the business community.

Across the board — from government officials to business leaders — there was a sense of preparedness. China had a policy plan for Trade War 2.0, but there was also an emotional preparedness. What I didn’t detect in Beijing was neither anger nor anxiety. It wasn’t quite resignation. It was a sentiment of, “We know this is coming, and we will deal with it.” The business community echoed this — “we don’t like this, but we’ve done it before and have no choice.”

That resolve mattered. The trade war actually went much better for Beijing than they anticipated. They weren’t expecting embargo-level tariffs, but the rare earth card worked better than they could have reasonably expected. Subsequently, we saw a walk-down from the Trump administration.

Jordan Schneider: Let’s stay on Chinese psychology for a second. Comparing this to Trump 1.0, I wonder if the experience of COVID and living through actual economic crazy dislocation means that Trade War 2.0, one to one-and-a-half percent of GDP — Xi talking for so long about “changqi douzheng 长期斗争” — we’ve got to get ready for a long struggle. Once you actually do some real struggle, gearing up for less than that may have ended up being less of an ask from the government.

Jon Czin: That’s an interesting point. I still have Joseph Torigian’s excellent biography in mind — that suffering in Xi’s mind is salutary for the public and for the polity.

The other advantage China had was experience. There is a real contrast between their behavior during the first trade war and the second. During Trump 1.0, Beijing was palpably caught flat-footed. They were groping for an adequate response. In retrospect, their approach was “no concessions, no escalation.”

Fast forward to Trade War 2.0, and the shoe has been on the other foot. Beijing had time to go back to the gym, pump themselves up — as Evan Medeiros and Andrew Polk have noted — and develop a toolkit of retaliatory measures, and they were ready for it.

Conversely, the US side suffered from a misapprehension regarding Chinese politics and the economy. Trump alumni returning to government likely concluded that China would fumble again based on 1.0. Furthermore, Beijing’s responses during the Biden administration were mild because they were caught flat-footed as well by moves like the October 2022 export controls. Yes, they complained, but they always kvetch about it. But there was very little substantive retaliation until the middle of 2023, and then a real acceleration during the transition — responding with much greater alacrity to things the Biden administration was doing on its way out the door, especially on export controls, putting some chips on the table for dealing with the Trump administration.

Two other factors also fed the Trump administration’s misreading of China:

1. The Post-Zero COVID Economy: A lot of analysis from Wall Street anticipated a V-shaped recovery in China post-COVID, mapping the Western experience onto China. That was never realistically going to be the case — you didn’t have the same revenge spending. The zero-COVID policy had diminished the government’s ability to pursue the same stimulus packages we saw in the West. When that rebound didn’t materialize, sentiment swung to extreme bearishness.

2. The “Peak China” Narrative: What happened in Washington in 2024 is a confluence of two tributaries. You have that happening in the business community (where Scott Bessent came from). On the other hand, in the strategic community in Washington, you have this “peak China” idea. Combine the zeitgeist in the business community with what people are thinking in the strategic community, and that’s the frame of mind the Trump administration had.

I have this theory — I don’t have any evidence to prove it — that whoever briefed Trump on China’s economy at the start of the administration likely appealed to his instincts by focusing on the real estate sector as the locus of China’s economic problems. You could only imagine him gravitating to that and saying, “Yeah, I’ve really got these guys over a barrel. They’re blowing up perfectly good buildings. What’s going on here?”

Jordan Schneider: That thesis is a bit different from what past guests have said. They’ve criticized the Trump administration saying, “How could they not have known about rare earths?” Yes, China’s been talking about it for a while. On the other hand, from 2017 through 2024, there were lots of things that could have potentially triggered a Chinese negotiation response of not turning the temperature down, but having the confidence to do a more “escalate to de-escalate” approach.

It is reasonable, however, like you said, to realize that embargo-level tariffs are qualitatively different from Trade War 1.0 or anything out of the Biden administration. But we do have Xi with a pretty long track record of not really wanting to go there or give the other side an excuse to turn the temperature up even more.

Jon Czin: The other element is that — and this gets to the next phase in the bilateral relationship over the past year — the Trump administration came in wanting to clobber China. And after that post-Liberation Day walk-down, they swung toward trying to mollify China.

Trump As His Own China Desk Officer

Jordan Schneider: In confluence with personnel changes, which shouldn’t be under-emphasized. To a certain extent it comes from the top, but when there are fewer people in the room every day arguing A instead of B, B is going to win out more, given a president who is clearly so influenced by the last people to talk to him.

Also, let’s not forget Trump 1.0, the trip to Zhongnanhai and the Forbidden City. Going to China is something he thinks is really cool.

Jon Czin: It’s both. It’s reinforcing. Your point’s well taken — there’s the old saw in Washington that personnel is policy, and there’s an element to that. But Trump wants to engage with Xi. He does want some kind of deal. The personnel changes are as much a cause of the direction as a symptom. My colleague Ryan Hass has this great line: “Trump is his own China desk officer.”

Jordan Schneider: Waltz in particular and the Signal chat — that felt kind of random. Everyone else has basically stuck around, which is remarkable given their (generously) middling performances and given the amount of heat that a Pam Bondi or Pete Hegseth have taken, not just from the New York Times but from further-right ecosystems too.

If Waltz hadn’t started that Signal chat, maybe he would have gained more favor, been able to keep more China hawks around him, and the internal center of gravity might have ended up somewhere different from where it landed in 2025.

Jon Czin: That’s a fair point. Fewer characters are being defenestrated in this season of Game of Thrones so far.

The administration’s evolution in the first six months was a seesaw. They started with “It’s clobbering time,” but by May — and the initial contact between Bessent and He Lifeng in Europe — they switched to mollification.

Contrast this with the Biden administration’s approach, which was more of a balance. Part of the reason we didn’t have as explosive a Chinese response was that our diplomacy was concerted. The export controls dropped in October 2022, but there was also a meeting between Biden and Xi in November 2022. We went from trying to keep the two in tandem, “manage the competition,” to use the phrase in vogue at the time, to more of the seesaw effect.

Jordan Schneider: The Trump 2.0 model for foreign policy is almost like — stir up some shit, declare victory, and move on to the next thing. This administration’s ability to focus on more than one foreign policy issue at a time is historically low, especially given the concentration of work that falls on the principals, and the fact that we have one less than we should have.

So it becomes easier to declare victory than to fight a rearguard action. We are seeing this in Venezuela now. Iran is enough of a “baddie” that we won’t be friends afterwards, but with China, there is enough on the other side of the ledger to talk yourself into the upside of a less aggressive tint in the relationship.

Jon Czin: And that’s basically what happened. There was an acknowledgment that China did have a lot of leverage.

The best argument the administration wants to make is that they do still want to focus on China. You saw this in some comments from Peter Navarro just last week — that this is just the chessboard they have to deal with now, that China has this leverage and we need to pause and refurbish ourselves before we can continue pursuing that competition.

The real issue with that is the timelines they’ve laid out. Expecting the rare earth issue to be resolved in a year or two seems very optimistic. It’s good they’re doing some worthwhile things on this front, but I’d be surprised — and I’m not a mining expert — if this is a “this year” problem or even a “this administration” problem.

Jordan Schneider: It’s not just this. These are two giant economies that trade with each other a lot. There will be ways for both countries to inflict serious economic pain on each other for the foreseeable future. Even if we did end up having 150% tariffs, there’s enough that routes in and around that — if China wanted to squeeze, they could do it. The leverage is not going anywhere anytime soon.

Xi’s Game Plan

But let’s turn to the Chinese side of the equation. What do you think Xi is working towards currently?

Jon Czin: Their game plan is simply to string this along through the midterm elections. That is the focal point organizing their thinking. They are betting that the closer the US gets to the midterms, the more leverage China will have — and the more Trump will want a deal to show for his efforts.

The China issue doesn’t have particularly high salience in American politics right now, given everything else going on. However, the impulse for a deal will exist on both sides. You can see why Beijing would map this onto the first trade war, which concluded with Phase One. That deal came about because Trump lost patience and leaned on his negotiators to “get something done” so he could bracket the difficult problems for later.

That is the game China is playing. While there may be affirmative things they want, most demands are coming from the US side. China is happy to negotiate away pawns on the chessboard — things like TikTok or buying US soybeans.

This highlights a shift in the conversation. The trade war was originally animated by deep, strategic economic concerns regarding trade imbalances and the nature of the relationship. China has effectively whittled down the conversation to a question of scoping. We are now talking about specific sectors, products like soybeans, or firms like TikTok. We are not talking about big macroeconomic imbalances. Some of these, like the current account deficit, are idiosyncratic to the Trump administration, but others — like China’s non-market, unfair trade practices — are long-standing concerns dating back to the Bush or Clinton administrations.

We aren’t discussing those fundamental issues anymore. They’ve got the administration playing whack-a-mole. That is the game plan for the coming year.

One other thought. My operating model after the post-Liberation Day walk-down was that the name of the game was just stringing Trump along. That’s why I was so struck by what happened in the weeks before the Busan meeting, where China dropped expansive export controls on not just rare earths, but the whole supply chain.

I know you had the two Chrises on to discuss this, which was useful. As somebody who’s watched Xi Jinping for a long time, that felt really different. It felt like Xi Jinping switching from being reactive to US policy to being proactive, taking the initiative, going from playing defense to playing offense.

There was all this talk at the time about China being overconfident — did they overplay their hand? I don’t think that was the case. They took a calculated risk and thought maybe they could get away with it with impunity. And they basically did. The administration kept the meeting on the glide path. I know they walked it back, but I think that was always the plan. When they did the original announcement on the first day, they said it won’t go into effect until December. They intentionally left themselves leeway and were sending an obvious signal that this was going to be up for negotiation.

They played it very well. It’s not because they think in terms of dynastic cycles — it’s a one-year deal. It’s going to expire potentially just days before the midterm elections. They just looked at their Outlook calendar and figured Trump’s not going to want this to unravel just days before the midterm election. This will provide more leverage and more incentive for the Trump administration just to keep things quiet a year from now.

Jordan Schneider: It’s so funny — it’s like Republicans and Democrats arguing about how long the continuing resolution should be, because does the renewal of the budget land on terms favorable to us or favorable to them?

But your point about Xi acting as an escalator in the US-China dynamic is fascinating. Before that, we had the BIS rule, which was expansive and would have snagged a lot of new firms. And that was a big thing. Doing the “big thing” back to us — rather than doing 50% of the thing and hoping to de-escalate — shows they understand they can play a different game than Venezuela or Iran. That proved powerful because the Trump administration backed down and moved on to other adventures in sunnier locales.

Jon Czin: That’s right. The way I’ve heard one of my Chinese colleagues put it — it’s not that the US side doesn’t have leverage. As you indicated, there is this interdependence and both sides can weaponize it. It’s that they don’t think we have the stomach to use it. That’s what they’ve learned from the past year. There’s not the willingness to follow through and make it an expensive Christmas during a midterm election year for US consumers.

Jordan Schneider: My counter-consensus thesis for 2027 or 2028 is this — say we have a Democratic House or Senate. Trump is increasingly frustrated, angry, dealing with subpoenas and oversight, and no bills are passing. Anything domestic politics becomes incredibly “not fun.”

Suddenly, the ability to lash out and act in the foreign policy realm is oodles larger than trying to do crazy stuff with ICE domestically — where Democrats might just try to defund them. I can see an 82-year-old man, angry and frustrated, deciding that the “nice thing” — the respect-based comedown after China’s “escalate to de-escalate” — is working less well. The psychology of that, coupled with frustration at home, may lead to a cycle more aggressive than the past year’s data points would suggest.

Jon Czin: That is a fair observation. That is the downside risk for China even in the coming year. Yes, they want to string Trump along, but they have to avoid pushing him too far. They must give him just enough to keep him invested in the process — enough “wins” or concessions that he doesn’t blow the whole thing up in frustration.

Regarding your point about Trump focusing on foreign policy because he feels roadblocked at home — I think he is kind of there already. It isn’t necessarily because he is roadblocked, but I have been struck by how, for all his unconventionality, he is behaving like a conventional second-term president by spending so much time on foreign policy.

Even MAGA voices are complaining, asking why he isn’t focusing on affordability or the “Big Beautiful Bill.” He bequeathed the moniker, but from the press reporting, he was not really super invested in the process itself.

He is spending much more time thinking about Venezuela, pursuing Greenland, or trying to cut a deal with Putin or Xi. It’s all borne from a similar impulse — an older gentleman thinking about his legacy. What is going to be my role on the world stage? He wants to be a world-historical figure, not just a US figure.

Jordan Schneider: Exactly. Not just some guy who cut some entitlements.

How Things Could Go To Shit

Jordan: Other theories for how this could all go to shit over the next few years?

Jon Czin: There are bumps approaching in the run-up to April. It has been quieter than expected, but we have the pending Supreme Court ruling on the IEEPA tariffs.

If the administration is forced to reconstitute the tariffs under different authorities, it will be telling how China handles it. Do they say, “That’s okay, we don’t want to blow up the rapprochement”? Or do they say, “No, these are new tariffs and if you reconstitute them, we’ll reimpose the rare earth export controls”?

Even though things have settled on the trade front, I am not convinced the Trump administration is done unburdening itself of all the trade measures it wants to pursue. There is an open question — do they exempt China? If you exempt China but not some of our closer economic partners, what questions does that raise? Those are ways this could get bumpy, barring an exogenous shock.

Jordan Schneider: Let’s talk through the Chinese side. What could cause Beijing to rock the boat?

Jon Czin: They would want some kind of pretext. They’re not really into doing bolt-from-the-blue, even if they manufacture a crisis. They want something they can point to.

I made this point about Xi shifting from defense to offense. But the main way that’s really materialized in the last few months is not directly tête-à-tête with the United States — it’s manifested in the way Beijing is approaching our allies and partners.

This whole dust-up at the end of last year with Takaichi doesn’t seem to have impinged upon the US-China rapprochement. The Trump administration didn’t seem to move very quickly to try to reassure Takaichi or bolster her position. That’s going to be the game China plays.

It’s a similar dynamic with Europe. Right after Liberation Day, because the trade war encompassed Europe, a lot of people expected some kind of charm offensive from China. That didn’t materialize. Instead, China’s approach was to try to intensify the pressure on Europe rather than alleviate it — show them they don’t have great options, and therefore they should be more amenable to China’s perspective on a variety of issues.

You could see that even in the run-up to the China-EU summit last July, they were pretty rude with their European counterparts. You had Wang Yi saying the quiet part out loud — they don’t want to see Russia lose the war because then the West will just refocus on China and the Indo-Pacific.

While there are things they could do toward the US to rock the boat, they will want a pretext. If the US side can navigate some of these things, I could see them keeping it on cruise control on the Chinese side.

The other data point is the cross-strait dynamic at the end of last year. You had that blockbuster $10 billion arms sale from the Trump administration to Taiwan, which I give them credit for; it was a good package, very extensive.

Then China responds, but not by laying into the United States. They did another giant military exercise, of course. They wanted to send a signal to Japan, and probably wanted to send a signal to us. But more than that, they wanted to send a signal to Taiwan that the US isn’t going to back you up on this.

This gets into a question about short-term versus long-term trade-offs in the Trump administration’s China policy and approach to Taiwan. You announce this massive arms sale, but then when there is actual coercion and squeezing, there’s kind of a meager State Department response, and that’s really it.

China went forward down this path because they weren’t concerned it was going to upset the bilateral dynamic — and they had good reason. The last thing they did right before Liberation Day was Strait Thunder A. They did a big exercise right before, which elicited very little response from the Trump administration.

Jordan Schneider: But what are you going to do? “For every exercise, we add $3 billion in arms sales.” Do you set it up like that — something obnoxious?

Jon Czin: There’s a variety of options you could do. We dealt a lot with this during the Biden administration. We had the Pelosi visit go down and the question is, then what do you do?

There was that multilateral statement about it, and Taiwan expressed its thanks afterwards, and we were noticeably absent from that. There are minimal things you could do at least, and the absence of them now sends an unfortunate signal to China. If you don’t do those things, it’s going to get interpreted/ misinterpreted by China.

Jordan Schneider: In a dream world, how would you see an American president responding to what you saw over the past few months with respect to Japan and China?

Jon Czin: I thought it was an opportunity. My own perspective would have been that we should have embraced what Takaichi said. I know she got put on the spot in Parliament, but we should have said, “Yeah, this is just a recognition of the reality — that some kind of Taiwan contingency is going to impinge on Japan’s national security interests, and we’re going to cooperate more closely with them on it.” Then, when there was retaliation, try to find ways to support it. Having some kind of presidential statement from the top, but also having some kind of policy to say we’re going to support Japan on this or we’re going to raise this issue.

Instead, the reverse happened. The reporting in the Financial Times and the Wall Street Journal suggests that what happened was Trump talked to Xi Jinping, then he got off the phone and talked to Takaichi. We don’t know the details, but it seems like Xi is using the relationship to lean on the Japanese. That’s probably the exact opposite of what the approach should have been.

This gets to something broader. There’s a tactical question. There are two ways to handle Beijing. There’s the inside-out approach, where you deal with Beijing first and that becomes your ordering principle for your diplomacy in the region. Or — I’m biased because this was more the approach in the Biden administration — there’s the outside-in approach. Beijing is recalcitrant and difficult to deal with and doesn’t follow through too often, so what you do is try to change the environment around them. We’re getting two very different approaches which are mirror images of each other.

Jordan Schneider: The really frustrating thing is the whole Elbridge Colby, even the broader MAGA thinking, “The allies gotta step up, it’s their problem.” You have a Japanese Prime Minister doing the exact thing you want them to do, saying, “Yeah, this shit is our problem too, and we’re gonna have to take responsibility and step up for the fact that a PRC-owned Taiwan would really suck for Japan.”

So here we actually have a leader doing the thing, China gets annoyed by it, and we say, “Oh wait, actually we don’t want you to be saying the thing that we’ve been asking you to do for 30 years, as well as explicitly the ostensible cornerstone of American foreign policy.”

It’s a weird intellectual disconnect. As you said, if the main thing you’re worried about is the vibes between Xi and Trump, then yes, Xi has a lot of agency. But if you’re worried about the balance of military power or how Xi is perceiving what the balance of military power would be in a Taiwan conflict, then this is the best thing that has happened over the past few years — this broader trend starting from Abe 2.0 and going all the way through Takaichi of Japan remilitarizing in a way that was very uncomfortable for their system for decades.

Jon Czin: Our closest ally in the region stepped up and said what the reality was. Instead of embracing them for it, we hung them out to dry.

Something that’s been on my mind as I’ve been digesting the arms sale over the holiday — I could see how the administration would say we’re not going to get caught up in this day-to-day tactical stuff, or gray-zone stuff, or diplomatic spats. We’re really going to focus on the long-term game with China — focus on things like these big arms sales which will have an actual impact over the long term on the military balance, and not get caught up in this day-to-day churn on the South China Sea or other issues.

Is the Trump administration speaking softly and giving Taiwan a big stick? But it’s hard to say that’s actually the case just because that’s so uncharacteristic of them.

Jordan Schneider: I think it’s that you’ve got a lot of different people paddling in different directions. There are some staffers who know their shit who are just trying to keep it under the radar and trying to do the right thing. That’d be my hypothesis.

Jon Czin: That’s probably more where I lean — kind of a mosh pit theory of this, where occasionally you get some guy who gets crowd-surfed to the stage.

Jordan Schneider: Like, is Scott Bessent really pining for the arms sale to China? I don’t think he could give two shits, but maybe. Welcome to the pod, I’ll talk you into it.

Jon Czin: It’s got to be interesting what the president’s perspective must have been on this — how this is good business.

Jordan Schneider: But we don’t want the CEOs making any money, so I don’t know.

Cake, Coups, and Chess

Jordan Schneider: Other 2026 things?

Jon Czin: I want to talk about how Venezuela and Iran do or do not tie to the China dynamic. Some people are making the case that what happened in Venezuela actually bolsters the administration’s efforts to compete with China over the long term — shoring up your own backyard. It’s what great powers do when they start to get overextended. They retrench.

But I’m suspicious of that argument. As splashy and frankly impressive as the operation was, from Beijing’s perspective it’s really on the periphery of their strategic thinking.

I don’t want to just poke at straw men, but I have seen people making this case — that this clearly shows the capacity of the US military and our vim and vigor under the Trump administration, which it does. But when you have a softer approach toward the other great powers, it diminishes the signal toward China and Russia.

For Xi Jinping, he already recognizes Trump’s penchant for unpredictable acts of violence. What I was thinking about over the holiday — if you rewind to 2017 during Xi’s meeting with Trump at Mar-a-Lago, over the big piece of “beautiful chocolate cake,” Trump tells Xi that they just launched strikes on Syria. So this doesn’t really upset their fundamental equation.

As far as Venezuela goes, the relationship was already in rough shape between China and Venezuela. Venezuela wasn’t paying its bills. The real open question is what kind of impact this has on China’s foothold in the broader region, because a lot of this is about whether you can compete with China economically in this hemisphere. It’s not clear that’s the value proposition this administration is bringing to bear.

Jordan Schneider: Even then, is the ability to export cars to Mexico and Brazil going to be the thing that saves the Chinese economy or determines the 21st century? I don’t think so.

We also heard this theory that regime change in Iran plus regime change in Venezuela means China doesn’t have any oil. That’s more new leverage. Not really, right?

Jon Czin: It makes it more expensive, but they can deal with this. They’re not happy about it, but these are problems they can manage.

Jordan Schneider: There was a debate for a little while on the extent to which this is a new norm that would encourage folks in Beijing to say, “Ah, maybe we could pull off this sort of thing in Taipei.” Of course, there’s this famous layout of downtown Taipei and Parliament — like a whole six blocks where everyone has fun and does their coup cosplay. How much do you believe in this narrative?

Jon Czin: It’s unlikely for a couple of reasons. China doesn’t put much stock in some of these norms. These things that happen that change the precedent — it doesn’t really matter that much to them. Maybe it gives them a little bit more rhetorical space if they want to do something.

Then operationally, this isn’t an appealing template for Beijing. Even if they actually pull it off — kidnap someone or something really wild — the Taiwan government and polity are stable enough where there is a line of succession. The regime would still be in place. You’d have a similar conundrum to what the administration is facing now. Do you try to collaborate with the government that’s there? It doesn’t really solve their problem.

Jordan Schneider: I hear you Jon. In a functioning democracy versus a kleptocratic Venezuelan regime, just taking the top person off the chessboard may not actually give you what you want. I would imagine what happens to Taiwanese politics the day after a leader gets abducted?

Jon Czin: Does it have a catalyzing effect, the way Russia’s invasion had a catalyzing effect in Ukraine?

But all of this gets to this bigger point about strategy and this argument that this is somehow part of a deeper, longer play vis-à-vis China. In my view, it’s not the long game, it’s the wrong game. If you really are serious about competition with China, this is not what you do. If you think of it as a chessboard, this is playing around with the pawns on the side of the board rather than focusing on controlling the center of the board and developing your big pieces — like Japan and these other pieces that we are neglecting.

Books, Risk, and Boomer Chaos Muppets

Jordan Schneider: Any recommendations to take us out? Anything you’ve enjoyed recently?

Jon Czin: I started reading the Pantsov and Levine biography of Deng Xiaoping last year and thought it was very good. I know Ezra Vogel’s biography got a lot of attention a few years ago when it came out, but for my money, the Pantsov book is much better.

One of the real shortcomings of the Vogel biography was that it deals with the first 50-60 years of Deng’s life in the first 50 or 60 pages of the book. It doesn’t talk about his time as political commissar of the 2nd Field Army in the Huaihai campaign and what his role was during the Mao era.

The Pantsov book really gets much more into that — where Deng is just an underling, a mishu in the party, and then he gets sent out west to Guangxi Province early in his career. It’s all novel, super interesting, and almost cinematic about Deng in his early years, and how he became the man and leader he became.

Jordan Schneider: I found the Pantsov Chiang Kai-shek book a little boring — just because Chiang Kai-shek is a little boring. He’s this more straight-edge dude who’s trying to rectify himself all the time. And it really does very little post-49.

But their Mao book, man — that’s the best one-volume Mao history. It’s well-rounded, grounded in real sources. It’s not like the Jung Chang book. For a taste, the Jonathan Spence 100-page one is a great little Mao entry point — you just get Mao’s energy. But if you really want a meaty history of the man, that’s still my go-to recommendation.

Jon Czin: One of the books that really stood out to me last year, especially as somebody who follows Chinese politics, was Joseph Torigian’s book on Xi’s dad. I’m very impressed and happy it’s gotten the attention it has because there’s a lot in there.

What really comes out is that you can tell — especially when Xi Zhongxun, during the uncertain politics of the ’50s and then when he’s back in power again in the ’80s — he’s just very much a guy trying to make his way in the world and trying to figure it out on a day-to-day basis. That sense is lost sometimes when you talk about these almost larger-than-life figures in Chinese politics or any polity. But these are still guys who make mistakes, find themselves on the wrong side and don’t know why.

For all of them collectively, especially in the ’80s, they didn’t have a roadmap for how to do reform and opening up. They were really truly just figuring it out.

Jordan Schneider: On the figuring-it-out thing, I want to come back to Trump. Over the course of 2025, it feels like he’s rolled a lot of double sixes — especially the tariffs ending up not really being that big a deal. Even the things where his instincts are the worst sort of not manifesting in that much downside impact. And he does have this skill of Teflon-ness.

The chances of a Chinook getting shot down over Caracas were probably 25%, but it didn’t happen. The chances of no one dying when you’re in firefights with people... I don’t think he can keep this up the whole time. But maybe he can and maybe everything will end up working out, and the US will somehow be in a better place relative to the rest of the world and relative to national power competition with China.

This country’s gotten a lot of breaks. I don’t know if it’s just a law of averages thing, but the fact that this could keep up seems unlikely.

Jon Czin: It’s a great point, and it reminds me of two things. Something a buddy of mine said to me when I went over to the White House to join the NSC, “You know, Jon, my PA always says it’s better to be lucky than good.”

And there’s this great old quote from Bismarck: “God smiles on fools, drunkards, and the United States of America.”

Even for Trump himself — he and his team were saying this right after Election Day — that this is the most improbable comeback in US history. For him to come back and be the first president since Grover Cleveland to have a non-consecutive presidency is remarkable.

But there’s a bigger point here. It’s a real problem for institutional Washington that Trump does these things with a very high chance — 25 to 40%, just to pick random numbers — of total cataclysm. And then he does them and the sky doesn’t fall.

He does tariffs — doesn’t provoke a recession. Has kind of a limited effect, as far as I can see from economists talking about it, on inflation. The sky doesn’t fall. You can even see this from his first term — he kills Soleimani, sky doesn’t fall. There’s no World War Three with Iran. Even with the Iran strikes earlier this summer.

He keeps doing these things that could end in disaster, but they don’t. The more that happens — that he does these things where everybody in Washington is clutching their pearls saying this could be a total disaster and the sky doesn’t fall — it ends up discrediting institutional Washington. It’s not because there’s no risk there, but because people are like, “Well, it hasn’t totally upset everything.”

Jordan Schneider: It’s two things. On the one hand, I had a little riff in the conversation with Jake Sullivan where he was like, “Look, Biden administration risk tolerance was on the low side.” That comes from the president. At the end of the day, when you’re making the biggest calls on this stuff, it comes down to how the president feels about downside risk.

Pretty much since Nixon, we’ve had presidents who were sort of worried. Perhaps what Trump has shown us is that calculus has been overtuned.

But the other thing is, once you get on a hot streak, you start doubling down. Even though we may have been calibrated in playing our poker hands too tight, you go all in enough times in life and you may not hit anything on the river.

Jon Czin: It’s like being in Atlantic City at the table on a hot streak.

But there’s something to it. You made the point about when was the last time we had a president willing to gamble like this. The obvious one is George W. Bush with Iraq.

Jordan Schneider: Did it even feel like a gamble at the time? We’d already invaded Iraq before.

Jon Czin: People knew it at the time, and it ended up going very poorly for all involved, including the United States.

But in addition to the blood and treasure and top leadership attention that was wasted and squandered in Iraq in those ensuing years, one of the other things Bush squandered was the American public’s appetite and willingness to take risks in foreign policy. Or to use the title of my colleague Michael O’Hanlon’s new book, To Dare Mighty Things. That went away.

That was a big part of Obama’s foreign policy. He did some very bold things like taking out bin Laden, but there was a preternatural caution. A big part of Obama’s approach to foreign policy, self-consciously, was to be a corrective to this haphazard, high-risk approach toward foreign policy under the George W. Bush administration.

For a lot of the people who were in the Biden administration, that was the milieu they grew up in — this period where there was a sense that we need to run a disciplined, thoughtful, calibrated approach toward conducting foreign policy. Not unreasonably.

Now you have Trump, and the amplitude has gotten much, much wider. So much of Trump is a long hangover effect from the Iraq war and a lot of the decisions and gambles that were taken then earlier in the century.

The last thing I’ll leave you with — people have pointed out that Bush, Clinton, and Trump were all born in 1946. I have boomer parents, so I don’t want to rag on the boomers. But as a leadership analyst, it is striking to me that for a generation that grew up with so much social and political ferment — these are the three leaders that came out of that generation, and they’re all kind of chaos muppets.

Clinton was known for making a lot of big decisions over pizza late at night with his fellow Rhodes scholars, having these late-night sessions. It wasn’t necessarily a tightly run, disciplined process. Same thing with Bush. And then you have the maximalist version of that under Trump right now.

Jordan Schneider: Another piece of that Iraq hangover is the scale. Even the worst-case scenario for Venezuela involved dozens dying, not thousands. Regardless of how adventurous Trump is, the idea that he would put thousands of troops at risk seems to be absolute zero.

Another piece of that Iraq hangover is even when Trump gets read out like the worst-case scenario of Venezuela — it’s dozens of people dying, not thousands. Regardless of how adventurous Trump is going to be, the idea that he would put thousands of troops at risk seems to me like absolute zero.

Jon Czin: This is more like the Robert Pape book, Bombing to Win — we’re just going to do it through air power, by remote control.

Jordan Schneider: But it’s interesting they didn’t just kill him — Maduro. It’s way riskier to try to grab the guy. If I were willing to do this, I would have just bombed him.

Jon Czin: This is the debate the Obama administration had about bin Laden. Do we just flatten the whole building? Do we go in and grab him to make sure we have the right guy? Do you lock him up, do you shoot him?

Jordan Schneider: But Maduro’s not going to be a martyred icon. No one likes this guy.

Jon Czin: Washington — stranger than fiction.

ChinaTalk is looking for new contributors to pitch deeply reported and analytically sharp pieces that go beyond headline narratives. Below is our wish list for H1 2026 that hopefully inspires you to to send us a pitch! It can either be directly related to some of the ideas below or just something you think we’d find interesting.

We pay a few hundred dollars per piece, and more for more ambitious work. You can write under your own name or a pseudonym. Don’t be scared off if you’ve never written for an outlet before or don’t have native English—we have amazing editors who love working with subject matter experts and first-time internet writers.

China’s Escalation Options

If and when trade tensions rise again, what will Beijing’s playbook be? We know about rare earth controls and the Unreliable Entity List (China’s equivalent to the US Entity List), but what’s the full range of economic pressure tools China has used or could use against the US?

We’re looking for articles that explore themes like:

• Mapping out where and to what degree Beijing conceptualizes its leverage in various sectors

• What economic or political constraints limit Beijing’s options

• What provokes more anxiety from a US escalatory perspective

(We’d also love to work with someone to turn this into an interactive choose-your-own-escalation game where users can see how different choices play out.)

China’s Energy Dominance

China builds energy infrastructure better than anyone. There is good coverage on the big categories like solar, wind, coal, nuclear, and hydro, but there are many sectors left to be explored in English.

Some ideas:

• How is Beijing handling new energy sources like geothermal and LNG?

• What specific policy and economic tools let China build energy capacity so quickly?

• What is the pipeline from China’s energy sector to the AI industry?

China’s Data Center Build-Out

China’s data center build-out is underreported. How are these facilities actually being financed and built? What subsidies make them viable? What is it like working as an IT engineer in China?

Some ideas:

• The subsidy structure and unit economics. Are these facilities actually profitable?

• Dollar-for-dollar capex comparisons: How much further does $10bn stretch in China vs. the US? (BOTECs welcome, interactive calculators (vibecoded or otherwise) even better)

• The technician advantage: Is this true? How did China build this workforce? What’s the training pipeline?

China + AI

We cover a lot of China’s AI landscape (see our 2025 China AI Wrapped post), but there is so much more to be discussed!

Some topics as food for thought:

• China and AI culture: our ‘Why America Builds AI Girlfriends and China Makes AI Boyfriends’ piece is now the best-performing in ChinaTalk’s history. What other interesting comparisons and contrasts can you make at a social level about how China and the world are using AI in daily life?

• Chip stuff

  • China’s Intermediary SME tooling advancements: What’s the best, well-informed estimate for when China could develop EUV lithography for large-scale production? How about DUV, EDA, or any other intermediary parts in the SME supply chain? (See our recent HBM piece as an example).

  • Compound semiconductors: How relevant are they to AI applications, particularly robotics? Who leads this market? Should US national security policy care more than it does?

  • Chips for robotics: How does the supply chain for these chips work? Should they be subject to export restrictions similar to chips for AI?

  • Chinese dependency on TSMC chips: Which firms would get hit hardest if access gets cut off?

• China AI’s global impact

  • Global AI Governance Initiative: Beyond abstract statements, what has Beijing actually done to make progress on this? Any angles beyond just what they’re saying in public speeches at APEC and the UN?

  • Chinese AI and soft power: How is AI being diffused into other countries, such as those in the Global South and/or the Digital Silk Road? We’re looking for tangible examples beyond just deep reads of policy frameworks.

• And of course, anything novel to say about Chinese models, model makers, and model makers’ business models!

China and the World

We’re not looking for general overviews of China’s relations with various other countries. We want specific, tangible examples of how these countries interact that you’ve uncovered (perhaps firsthand), notably if they intersect with tech. An Indonesian data center servicing Chinese AI companies. A Kenyan port built by Chinese firms is redirecting trade flows. CCP oversight looms over Hong Kong conglomerates’ assets in Panama. New Chinese military equipment is being sent to Pakistan.

• What’s actually happening on the ground that adds texture to our understanding of China’s bilateral relationships?

• China + the Middle East. Trump thinks he won over the Middle East’s money for Western AI. But has he? What Chinese interaction with big financing for ME money is still happening, if at all?

• Are Chinese models being used in interesting ways in other countries?

With the amount of coverage these relationships get in legacy media outlets, we’ll have a high bar for these stories. But if you speak a local language or have a unique angle that hasn’t been reported elsewhere, we’d like to hear from you!

Chinese Scientific Progress

China leads the world in patent filings and scientific publications. But what do these metrics actually tell us about scientific progress? How do Chinese norms around research incentives, publication practices, and innovation differ from other countries? And what measures actually capture where China stands in scientific discovery?

Some ideas:

• History of academia and research institutions: How did organizations like the Chinese Academy of Sciences come to be, and what roles do they play in strategically relevant R&D in the present day?

• Analyses of incentive structures: What motivates researchers in China to publish extensively? How has this shaped academic norms in a global context?

• Measuring scientific advancements in different fields: Are patent filings and publications good metrics for assessing a country’s position in a certain research field, such as patents for AI? If not, what metrics are better? How should we holistically understand China’s position in different areas of science and technology?

• Personal insights from inside the Chinese Ivory Tower: What does China’s scientific research community look like from the inside? Are there any stories you’d like to tell?

China’s Health and Biotech Sectors

We’ve covered biotech before, but we’re looking for people with insider knowledge to help us go deeper. Some examples of people we’d like to hear from:

• Go-betweens for Western pharma brands and Chinese chemical contract manufacturers,

• Chemists who run a quirky WeChat blog on the side,

• Anyone who has experience doing biotech research in China or has worked in marketing, government affairs, or the legal department of a Chinese pharmaceutical company.

If that sounds like you or someone you know, we want to hear from you!

Taiwanese Democratization

Sun Yat-sen and Chiang Kai-shek both agreed that Chinese democracy was the ultimate goal of the ROC project, yet CKS ruled Taiwan as a military dictatorship. But how did the Generalissimo and his son prepare the people of Taiwan to assume their civic responsibilities under democracy?

Some ideas:

• Official documentation related to the transition to democracy: If you’ve spent time in the ROC archives, you’re the perfect person to write this piece.

• Democratization of the intelligence services: What happened to the institutions dedicated to internal policing? What kinds of intelligence operations has Taiwan prioritized since the ‘90s?

• Taiwanese espionage/influence operations in the mainland: Surely there is some rich history here. What kind of objectives has Taiwan pursued, and what methods have Taiwanese agents used? What did secret ops look like under CKS, and how have they changed since?

• Conversely, how has the ROC uncovered Chinese influence operations? We’re essentially looking for someone to dig around in the ROC national archives to find counterintelligence records. How has Taiwan thwarted (or failed to thwart) CCP operations? What has the government learned from past intelligence failures? How have Chinese tactics (and ROC responses) changed over the past 80 years?

Miscellaneous Ideas

There are many other angles we haven’t covered here that could also make for strong ChinaTalk articles. Two examples are listed below to give you an idea of how different they can be from the subjects above.

1. GLP-1s in China

   1. Semaglutide (Ozempic/Wegovy) is being used in China, including for weight management, while domestic firms are racing to launch their own GLP-1 and next-generation variants ahead of a major patent cliff expected around 2026. As patents expire, Chinese pharmaceutical companies are poised to flood the market with cheaper generics and novel formulations, potentially transforming access to obesity and diabetes treatment in China and beyond. We’re interested in stories that examine regulatory shifts, off-label use and informal markets, pricing and insurance barriers, and China’s role as a future global supplier of GLP-1 drugs.

2. Breaking down 996: how Chinese tech companies digested American management-consulting lore and turned those ideas into the practices we see today.

   1. Chinese tech companies have developed very different internal cultures and practices, informed by ideas originated from Silicon Valley as well as their own experiences operating in China. Tell us about the history of management in modern China.