412. Is Trump Starting a Civil War? | LA Protests

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Welcome to the Rest is Politics with me, Alice Campbell.

And with me, Roy Schuert.

Nice to see you in person.

Yeah, I think we're going to do half USA and half UK.

I think that's the way to go.

Yeah, and you've been slightly resisting for the last two, three weeks, doing too much on Trump.

But I think it's good to remind people what's actually going on.

I just think every now and again, don't talk about him.

And last week we barely mentioned him, and I think it's one of the reasons why the numbers last week were exceptionally good.

Although I have to tell you that our Restis football colleague, Mr.

Micah Richards, who is a convert to the Restis politics has been bombarding me with demands for an emergency podcast on Trump Musk and I've been trying to explain that it's good sometimes to wait you know delayed gratification and all that so we are going to talk about Trump Musk we did get a lot of demands actually I mean it was amazing as soon as the Trump Musk fight got going my whole thread was that's the emergency podcast

I don't think that merited it I think sometimes we've pressed the emergency podcast button on Trump too soon.

It's about if it's signal and it really matters, go for for it.

If it's noise, no, I think Trump and Musk is a bit of both.

Yep.

It's a bit of both.

We'll come on to that.

But I think we should kick off with the creeping authoritarianism as exemplified in what's happening in Los Angeles right now.

Yes.

So whatever we think about Trump Musk, this really does justify really proper podcast focus.

Because to remind people what's happening, this is the moment at which the fight begins between the federal center and the state.

This is the fight Trump has been looking for.

It's got the three great ingredients that he's been looking for since January.

It's against a big political rival, Governor Newsom.

It's in a deep blue state, Democratic voting state, against his Republican base.

And it's on the issue that he's made absolutely central, which is the issue of immigration.

And in particular, the story that he's been selling for some years, but is really coming to the peak now, which is almost a conspiracy theory, which is that immigration in America is actually a foreign invasion by foreign armies taking over the United States.

So what do you make of it so far?

I think it's horrific and I was going to remind our listeners, I can't remember what the issue was when I first read out the 14 early warning signs of fascism as defined by the U.S.

Holocaust Museum in Washington.

Powerful and continuing nationalism, tick.

Disdain for human rights, tick.

Identification of enemies as a unifying cause, tick.

Supremacy of the military.

Well, we're seeing that.

Absolutely.

This one, I think you can give him kind of 50-50 rampant sexism.

But, you know, he probably is very, very sexist, but I don't think it sort of makes, it's not a big thing for him.

Control mass media, absolutely what he's about.

Obsession with national security.

Religion and government intertwined.

And I think that's why Vance is so important in all this as well.

Corporate power protected.

Labour power suppressed.

Disdain for intellectuals in the arts.

Obsession with crime and punishment.

Rampant cronyism and corruption.

Fraudulent elections.

And on the point 14, 14, the fraudulent elections, I'm rather drawn to David Frum's idea, David Frum, the writer and strategist that we had on the podcast a while back, which is that Trump, in his heart, despite all the adulation that he forces around himself, knows that his popularity is waning and therefore really worries about the midterms.

because that's when he can lose a lot of the power he currently has.

And this is almost like a kind of practice run

for lots of trouble around America where it looks like, or he makes it look like these sort of far-left radical lunatics, as he calls them, are causing trouble.

And he's having to send in National Guard, Marines, whoever it might be in different parts of the country, and eventually say, we can't hold elections.

I actually think it's as bad as that.

Because it's too dangerous.

Yeah.

And what you do is then you use those images.

Here are, as it were, Mexican gangs waving Mexican flags in the street, attacking federal officials.

And of course, people's perception of what's happening in California totally depends on whether you're on the progressive left or whether you're on the MAGA right.

These are two completely different universes.

And I was reminded of this because I spent a slightly unpleasant time yesterday evening going down the rabbit hole of people like Stephen Miller's posts.

So Stephen Miller, just to remind people, is the Deputy Chief of Staff Policy.

He's the guy that wrote Donald Trump's speech on January the 6th.

He's been one of the big anti-immigration ideologues.

He's the guy that listeners will remember during the signal chat when Vance and Hegseth are sounding off to each other.

He resolves the whole thing by saying, I know what Trump wants.

So Miller has really lent into this.

So he's been saying, this is quoting, we've been saying for years this is a fight to save civilization.

Anyone with eyes can see it now.

The government of the state of California has aided and abetted the invasion of the U.S.

And when he posts this stuff, and other congressmen begin posting this stuff, they are using these images focused in on burning vehicles, masked men, Mexican or El Salvadoran flags being carried.

And the impression that they're creating is we're back in the really extreme days of the California rioting of the early 90s or the 80s.

Whereas when you look at it on progressive left media, it's presented as relatively few people, isolated incidents, easily within the control of the California police, tens of thousands of California police.

And indeed, if Governor Newsom wanted help, he could call it.

I think the other thing that is

extraordinary, how quickly there have been the occasional mentions, you mentioned January the 6th.

The violence on January the 6th, when Trump was whipping up crowds to attack Congress, as a result of which people, including police officers, died.

The language being used by him and his supporters, like Miller, is almost

a mirror.

Then these were peaceful protesters who had a point and there was no question of sending in the National Guard.

Whereas this, and by the way, I was watching CNN and they were showing, yes, they were showing the burning cars and they were showing the flags and they were showing the police and they were showing the military standing there with the guns and they were showing the journalists getting shot with the rubber bullet.

And then they showed this huge pride march, which was happening in a different part of Los Angeles.

And they basically said that this is affecting about 1% of the ground area.

But of course, you know, we've said, and this is Michael Wolf's great take on Trump, his mastery of creating drama.

And this, as episodes of the reality TV show go, this is off the scale.

You know, literally troops, soldiers, National Guard, massive row with a Democrat.

Foreign flags, foreign invasions.

All of that.

All of that.

So it's totally, this is why I think Governor Newsom has been quite clever in, one,

not taking any crap, standing up to it, calling it out, this is a deliberate attempt to create riots and create violence, but at the same time, saying to the people of California and Los Angeles, don't fall for it.

Now, of course, some people will fall for it.

And then, of course, Trump comes out and says these are paid, you know, violent instigators of violence.

So I think this is a really, really, really dangerous moment.

And how the public reacts is going to be an important part of it.

But then again, I don't know if you saw at the weekend, Trump turns up at one of those UFC fights, walks into the stadium, big drama, heroes welcome.

Yeah, yeah.

So just to reinforce this, I mean, that, of course, is what you see when, you know, reading Representative Brandon Gill from Texas, who's posting stuff saying, import the third world, get the third world, with pictures, these people.

And then he's posting pictures showing a picture of blonde white people in California in 1960 on the beach and then contrasting it with masked Mexicans with flags.

Then Representative Riley Moore, West Virginia, absolutely textbook illustration of one part of the Trump camp.

He goes from posting pious statements about Catholicism, about the sacred heart, to then saying the world is under threat from Keir Starmer, who hates his heritage and abhors his ancestors.

So

this is an American congressman from West Virginia, and he is using these riots in California to launch another attack on Keir Starmer in the United Kingdom.

What's the sort of intellectual thread that takes him between Kirstama and his own voters about whom I'm presuming is more interesting?

So he's posting a picture of the definition of hate crime in the United Kingdom,

and he's highlighted a line in it, which is about how far-right nationalism could be a hate crime.

And he's flipping it around to say far-right nationalism isn't a hate crime.

People like you, Kirstama, who oppose far-right nationalists are engaged in hate crime because you hate your country.

I suppose what I'm getting to is that we're absolutely right in analysing the structure of the whole thing.

And there's a great Californian senator called Senator Padilla who has pointed out that this is classic Trump narrative.

You create a fake crisis, then you build the crisis, and then you bring in what he calls the theatrics of cruelty to try to turn it around.

But my goodness, it works with the base.

Because if you think about how the base is responding to this when they're whipped up by these representatives and by Miller, their feeds are absolutely nothing except a sense that the entire country has been invaded, taken over by masked foreigners.

And of course, it is in some ways, as Newt Gingrich identifies, brilliant politics.

I mean, Gingrich said it could not be clearer.

This is, you know, the clear blue sea.

It could not be clearer.

On the one side, law-abiding Americans.

On the other side, illegals and law-breaking.

So the political power of this, I mean, the sense that this is a gift for Trump, I think is very strong.

Well, maybe this this is the optimist in me, but I still think there's a big risk in this for him.

People really should listen to Jonathan Haidt, our latest interview on leading, because this is the guy who sort of really got into polarization of politics and the way that social media is used for that.

And interestingly, you and I both been sort of agitating because we interviewed him some time ago now.

It's about, you know, several weeks.

And because we have these other interviews to put out first, but actually the gap between doing the interview when things were calmer and hearing it now, because he actually says in that interview that he has never thought until now because of these technologies the powers of these technologies and the way that they're driving us all into our camps that america could become an authoritarian state but actually he feels that with trump with the backing that he has with the second term energy that he has with all these people around him and with this sense he says where i thought it was fascinating was in saying that he thinks the right are better at understanding the left and the left are understanding the right

but a right now a nationalist MAGA-fueled right

that literally will believe anything that he says to them.

Anything.

So in that height interview, I think we got into what I see as the big question about Trump's authoritarian, almost fascist approach to the US, which is, is the US going to respond by basically obeying?

In other words, it's going to become a fascist, authoritarian state, and he will be able to do all those things that he wants to do, undermining Congress, judiciary, executive, universities.

Or are we going to find that other side of the United States, which is incredible resistance, which is a polarized U.S.

where the Democratic left pushes back and ultimately pushes back unconstitutionally, violently?

That's the sort of Alex Garland

Civil War world.

And so when we see, and this is why I think this is such a critical moment, when you see Gavin Newsom now being threatened by Tom Homan with arrest, so we're going to arrest the governor of California.

And cue pile in by senators from Alabama and other places saying, lock him up.

And Trump saying, I think it's quite a good idea.

And

I think he's a really nice guy, but we should lock him up.

And then Yousom saying, bring it on, tough guy.

You know, I'm ready.

You're beginning to get into something really interesting.

And the National Guard is at the heart of this.

So just remind people what the National Guard is.

The National Guard is organized by state.

California National Guard is very big.

I think it's about 23,000 people.

And these National Guards operate not quite like the British Territorial Army.

They're a much more full-time, fully equipped, huge amounts of kit.

They deploy into Afghanistan, Iraq.

I served with National Guard units in Iraq.

So

they're not quite the regular

US military, but they're much, much better resourced and much more full-time.

There's also more of them than any other force apart from the Army.

435,000 of them, more than the Navy, more than the Air Force, more than the Marines.

And 435,000 is an incredible number of people, incredible number of people.

So traditionally, they were deployed only at the request of local governors because they were the guard of that state.

So, you know, where I lived in Connecticut, I was right next to the Connecticut National Guard headquarters.

And the exception, famous exception, was 1965.

Selma.

Yeah.

And there, LBJ, realizing that southern states are not going to back civil rights legislation, deploys the National Guard.

And of course, for progressives, that's a great moment of courage and heroism by LBJ.

Since 65, it's not happened.

National Guards have only been deployed at the request of the governors until now.

The reasons within the law, the reason why Governor Newsom is taking this to law is because there are limited reasons under which, circumstances under which a president has the right.

And one of them is that the local authorities can't deal with it.

That's not the case here.

And the second is if the government is facing rebellion.

Well, definition of rebellion doesn't strike me as of, you know, a few people kicking off because some of their mates are getting arrested.

You're completely right.

And that's the most dangerous if we wanted to go to the extreme.

And God forbid, but if we're looking forward a few months towards a worst case scenario, the worst case scenario comes here with the deployment of military force.

Are the National Guard going to follow the instructions of the President?

Or are they going to follow the instructions of the Governor?

And what happens when there's a standoff?

What happens when Pete Hegseth has now signalled that he has Marines ready to go into California?

And what happens when Stephen Miller, who's creating this whole narrative, says that the government of the state of California has aided and abetted the invasion of the United States of America.

So

this is where all the underlying structures of populism you know, we're the good guys, these the bad guys, we're the real American people, this is a treacherous globalist elite

really comes into light.

What do you think of the way Newsom has been responding?

My initial instinct was very positive towards Newsom.

But there are elements of danger, of course.

He's not choosing to respond by when they go low, we go high.

You know, there's a lot of him being pretty match and populist in his response.

You know, he's attacking Trump, saying he's old and doddery.

He's not the guy I saw before.

Stone-cold liar, tough guy, all this kind of stuff.

I wanted sort of one more question, because I think one of the most most interesting things that your friend Michael Wolfe pointed out in our interview, which we keep coming back to, and which I keep thinking about when people ask me,

how does one predict what Trump does next?

And I think basic answer is incredibly difficult.

Even his closest friends don't know 12 hours before he does it whether he's going to put the tariffs up or down and what he's going to do.

But the storyline bit, this idea that he's a reality TV star, is probably the best way of thinking about it.

And I was thinking on the tube and the way in

that you are somebody who

is credited with developing the idea of a grid, which essentially, I suppose, is a kind of storyline.

And then I was thinking, okay, let's try to imagine that Trump is writing a movie where he is the hero and a Star Wars franchise.

And I was going to posit this to you and see whether this made sense to you.

So it strikes me that it begins

with, as it were, a kind of new hope.

Trump returns.

Yeah, the king comes back from exile.

The Avengers reassemble.

You know, Elon Musk and the guys and Hegseth and all these Fox News anchors, these good-looking dudes come around him, and he immediately takes action to restore, you know, justice.

You know, he releases the January 6th rioters.

He goes after the globalists.

He gets rid of their relation with WHO.

He puts America first, stops the money going.

And then there's a kind of Empire Strikes Back.

moment or but sorry from his point of view it's when he he's the hero right so this is is the point when the evil people come back.

And when do the evil people come back?

Well, the evil people are revealed suddenly when these horrible foreign countries start putting retaliatory tariffs against the U.S., when Harvard University, this sort of woke conspiracy, begins suing him, and people in his own party start trying to stop the big, beautiful bill.

And then the real dark knight of the soul.

You know, he's betrayed the Judas moment.

He's betrayed by his closest lieutenant, Elon Musk.

But don't worry, you know, he's coming back.

and he's coming back ever stronger because it turns out that all these things that seem to be sources of weakness are in fact sources of strength.

Yes, he's lost Musk, but that also makes him stronger because he's lost his competition.

Yes, there's economic chaos, but he's the only guy that can solve it.

Yes, there's a constitutional crisis, but that just gives him a new mandate.

It gives him a new storyline.

A new storyline.

So over to you.

But

in this storyline...

Do you believe what you've just said?

In his head and for his supporters, I think it sort of resonates with the way in which I think they read this story.

Now, the progressives read the story in the other way.

The progressives read the story where everything ends with a democratic victory in the midterms.

And that's the moment.

And now, for those of us who are anti-Trump, this is the moment where he's being defeated and he's overstretched and he can't accept constraint.

And now Newsom is pushing back, China is pushing back, the whole structure is crumbling around him, and we win in the midterms.

But I think from his point of view, the narrative goes in a very different direction.

I think all the pushing back just strengthens him.

Well, a lot will depend on how things play out with the public.

Where I think you're right in relation to the midterms, this goes back to David Frum's point.

That's politically the next big moment of real vulnerability.

All the rest of it, he's got away with so much stuff.

Every day is such a big drama.

But that's a moment where just for a day or two, he loses power because power is in the hands of people who decide the makeup of the institutions, which so far he has managed to weaken very, very well.

Not least with the appointment of that Mike Johnson as the speaker, because he is literally a lapdog.

He will say and do whatever Trump says.

But if you maybe, let's just go to the big, beautiful bill and the thing with Musk, because I think this is where this becomes relevant.

They got that through by one vote.

So you have to assume, even though his base may feel emboldened and strengthened, I don't believe that every single person who voted for Trump is happy with what's going on.

In fact, we've seen them.

Jonathan Haidt, again, to go back to his interview, he mentioned how the Democrats, with all their kind of what he defined as excessively woke agenda, actually lost, they pushed Latinos over to Trump because Latinos didn't care about LGBT, they didn't care about, you know, gender parity, they wanted to stay in America and make a life with their family, etc, etc.

So they got pushed over to Trump.

Okay.

Well, how are they feeling now?

How are those Latinos feeling now?

when they see what is happening to them, to their cousins, to their brothers, to their sisters and this ICE thing, which is deliberately meant to terrify them.

So I don't believe he's going to hold on to everybody.

So I think in his head, he's not stupid, we know that.

He's thinking the midterms aren't looking that good.

So the drama becomes the state of emergency.

So you create, how do you have a state of emergency?

You create it.

And the fact that he can send in the National Guard when we know the guidelines and we know when you're meant to and when you're not meant to.

So you literally have every Democrat governor come out straight away and sign a letter saying this is unconstitutional.

Has there been a single Republican voice pushing back on that?

Not that I've seen.

So you've got this total division and it's then all about who wins the battle of the narrative on any given day, in any given hour.

So sitting here right now, we might say, well, it's impossible to imagine you wouldn't have the midterms.

Well,

on your theory.

Let's see.

And again, I'm just wondering, in the logic of this, I know it's a crazy narrative to ask you to think about because this isn't what you were trying to to do with your grid, but isn't there a sense in which in order to keep capturing it, you have to keep escalating?

It's got to become more and more extreme, which is why I still don't completely discount that he might invade Greenland or do something like that, that at some point as he runs out of storylines, because we become sort of immune to the normal stuff because it doesn't interest us anymore.

So the franchise has to get more and more mad.

Well, listen, what about this?

Overnight, last last night, you've had one of the biggest Russian drone attacks on Kyiv since the war began.

Okay, where's Donald Trump?

Nowhere.

He's moved on.

Not that long ago.

First of all, he was going to sort out in 24 hours.

Then we had the whole Zelensky meeting.

Then we had the meeting in the Vatican.

Then we had that we're going to talk in Istanbul.

But that is not today's storyline.

He doesn't care about that.

And the media led him away with it the whole time.

How many times have we actually seen

January the 6th and the contrast with this mentioned?

It's all about, you know, it's 24-hour news covering this thing minute by minute.

And that's what he's good at.

Last one on this, and because I'm just very interested in how you think about this narrative.

Another problem that he has in his story is he's got three people, Pam Bondi, Cash Patel, Dan Benginger, who have come into these operations and things like the FBI.

And they've come in in order to expose conspiracy theories.

They haven't found them.

Right.

So they've got a problem, right?

So they've said, these are people who say there are these Epstein files that need to be released.

Laura Loomer, of course, who's still very popular with Trump, says 9-11 was an inside job.

The school shootings are a ruse.

There's all these January 6th people who've been pardoned who are demanding results, who want investigations opened against federal agents.

And the problem facing Cash Patel and Dan Bergingo is that they look at the Kennedy files or they look at the Epstein files and Dan has had to come out and say, having been on a podcast saying this is a big deal, now has to come come out and say, actually, I've looked at the files and Epstein killed himself.

He wasn't killed, right?

Which is creating a problem because the January 6th writers are very angry.

Tucker Carlson, Alex Jones are like, what's happened?

You know, these guys are...

Where are our conspiracy theories?

These guys have just been taken over by the globalists.

They've been silenced.

And of course, Musk, and this maybe is a transition to Musk, Musk played into this.

He said, well, of course, the reason he's saying this is that Trump is in the Epstein files, and that's why they haven't

released the Epstein files.

So this is what happens in the world of conspiracy theories.

Once you debunk one, you just create another through the same theory.

I think on Musk, and this with respect to Michael Richards, footballer, football pundit, rest is football, and he wanted us to do this emergency podcast.

But I think rather than focus on

the Trump Musk spat and he said this and he said that, I think there's something...

very interesting exposed by this at a deeper level, which is genuinely about economic strategy.

Can I, before we get onto that, let me just quickly do a quick explainer for listeners who didn't follow the I think everybody followed this one.

Well, I mean the details of it are pretty peculiar because I've just been reminding myself.

I mean I saw it explode on Twitter, but it starts with Trump doing an interview when he's with Friedrich Metz and he says, look, I had a great relationship with Elon.

I don't know whether we will anymore.

I was a bit surprised about his criticism of the bill.

And Musk is watching this and he says, immediately starts tweeting out.

And bear in mind, a week earlier, he had been in the White House, in the Oval Office, when Ramaposa was there.

Exactly, absolutely.

And he'd done this sort of farewell thing when Trump says he said right things.

And Trump begins to say, you know, I think Elon's just cross about the fact that I took away subsidies for electric vehicles.

And he'd actually, he read every word of this bill.

So I have no idea what he's doing coming out criticizing it, which is a classic thing you say when someone resigns and sends a nasty resignation letter, right?

Musk immediately fires back.

He's like, whatever.

Yes, the subsidies were unfair.

But there's nothing big or beautiful about this bill.

And it's completely false.

I never read it.

And this guy said deficits are not allowed.

At which point point, we then get a real escalation.

So he says, Musk says, I'm going to set up a new political party, which 80% of Americans are going to vote for.

And at that point, Trump, quite interestingly, doesn't go on the personal attacks against Musk.

He begins to move on to, firstly, he says, we're going to terminate his contracts.

Now, this is a big problem for Musk.

Two and a half billion dollars at least of federal contracts came in last year to Musk's companies.

He's facing regulatory investigations from 11 different agencies on things like water pollution from SpaceX, safety issues and firing off, fatal accidents, autopilot stuff.

At which point Musk comes back and says, as we said, you know, Trump is in the Epstein files.

This is the real reason they've not been published.

Have a nice day, DJT.

Trump then keeps saying, doesn't go personal, keeps saying, I don't understand.

This is about the bill.

And at which point, Musk is like, we're going to decommission the Dragon spacecraft, which is a big problem for NASA.

NASA's very, very dependent.

Actually, because all all the other people, Boeing's spacecraft, haven't been fixed.

Northrop Guermans are collapsing in transport.

So actually, he's got the Pentagon and NASA where he wants them.

And actually, Trump can't build the Golden Dome at the moment without a lot of Musk's kit.

And then he says, he retweets, impeach Trump, put in J.D.

Bance.

And Trump's still saying nothing.

Bill Ackman, this extraordinary sort of billionaire who's absolutely drunk the Kool-Aid, says, I support both of them, make peace for this great country.

Hug each other.

At which point, Musk says, You're not wrong and begins to back off.

And now we see Musk supporting Trump on all the stuff he's doing in California.

I mean, I think the just to give people a sense of the scale of these substances, because Musk likes to project himself as this great sort of private sector genius.

His companies have received 38 billion from the government over the last 20 years in the forms of loans, contracts, and tax credits.

Tesla, 11.4 billion in in regulatory credits from federal and state.

Tesla and SpaceX account for $15.4 billion of government contracts in the last decade.

After the last sale of some of the Tesla stock three years ago, people reckon he's now got 37% of his net worth, richest man in the world, is tied up in Tesla stock.

So when Trump does some of his stuff that hits his share price, that is a really, really big problem.

And he did, didn't he?

He hit it hard.

Yeah.

Yeah.

And they had shares tumbled.

So what Bloomberg reckoned,

i think he had the biggest second biggest single share loss in a in in one day 14

and they reckon so he's lost a lot of money in recent weeks bloomberg reckoned that they he added a hundred billion to his wealth immediately after the election because tesla was going through the roof but that he's now lost an awful lot of money so he's looking at that and he's thinking maybe i need to wind my neck in a bit the other thing you've mentioned before and a lot of people have written a lot about this in the states in recent weeks is this thing about his his drugs and one of Trump's comments is well Elon's got a problem and then they said well what is the problem I don't want to talk about the problem but it was obvious I imagined he was talking about this this drugs thing so what you have a sense of when he's going through that crazy tweet after tweet after tweet is that he's kind of wild and he's out of control and then he sort of then he then he calms down but I think what's really what could be of lasting difficulty for Trump on this is that what the let's just assume for a minute that Musk does does have genuine views about the way the economy should be run.

So that when he went in to do Doge,

he honestly thought he was going to have massive power and he was going to be able to cut government federal spending by trillions.

Yeah, two trillion, I think you talked about it at one moment.

And he's failed.

Okay.

He cut 100 billion, I think he said of two trillion.

And meanwhile, the bill comes along, this big, beautiful bill so-called, and at its heart is a level of federal spending and federal borrowing and deficit and debt building that is off the scale for a fiscal conservative.

And therefore, I think there must be part of him that thinks this is absolutely nuts and this is unsustainable.

Add in, so China, I didn't know this, Rory.

Tesla's largest factory is in China.

And as of last year, it's reckoned they made around half of Tesla's vehicles.

So the tariff stuff's kind of damaging him in all sorts of fronts.

And we said last week, BYD have now overtaken Tesla.

He probably

was still in the, when the tariffs stuff was going on, was probably still in the thing, well, I can influence this guy, I can get this guy to the space where I want him.

But actually, his economic vision is totally against tariffs.

And so you've got a combination now of tariffs.

I was interested in this amazing

German radio, ARD, that did a six-part podcast on Peter Thiel recently, which I'll talk about more when we do our thing on JD Vance, but it was really interesting.

But what his, part of his vision of the world, apart from all the Christian stuff, which is really, really interesting, is actually that we need more individual states.

We need lots more countries, because you have lots more countries, you can move your money around to different places and avoid tax, avoid regulation and so forth.

And the tariff stuff, far from being America first,

is actually damaging them, damaging the tech bro billionaires.

And so it's a combination of these two things that I think has genuinely pushed Muskoff's offside in relation to the overall strategy.

So Fiona asked me the other day, if Musk suddenly started giving loads of money to the Democrats, would I welcome that?

Would I think that was a good thing?

It's a good question.

It's a very good question.

It's a very good question.

And I think, and if that happens, it will become a difficult question for the Democrats.

I think my answer is no, because I think you need to expose what Musk is and what he has done as part of this awful Trumpian damage to the country.

You're completely right.

And I guess that the problem politically with accepting grants from Musk and somehow rehabilitating Musk and the people that I can now see in my street who have swapped the sign that used to say, I bought this Tesla before he went mad, to I'm now driving this Tesla again, now he's gone sane, is that if you let Musk off the hook, you're basically allowing the entire Trump project off the hook.

You need to explain that our problem with them is

yes, about policy, yes about communication, but fundamentally it's an ethical problem.

It's a moral problem.

Final thing to end on.

So Elon Musk has been doing these very complicated calculations about how much a trillion is to try to explain to the American public how big a trillion is.

But you can apply it to his own wealth.

So a million seconds ago was May the 23rd.

A billion seconds ago was 1993.

And Elon Musk's personal wealth, which is 400 billion, is 11,300 BC.

So every year is a...

So a million seconds takes you back to a pound.

Every second is a pound.

A million seconds

is a dollar.

So a million dollars or a million seconds is May 23rd, a billion, 1993, and his 420 billion is 11,000 BC.

And the reason one's doing this is that one tends to, in one's head, think the difference between a million, a billion, a hundred billion is just incremental.

zero or two.

But in fact, once you put it into time, you get a sense of what it means to say he has 400 times more wealth than a billionaire.

That's like the difference between a billion seconds ago ago being 1993 and 400 billion seconds ago being 11,000 BC.

I think the point you're making is very, very, very wealthy.

Insanely wealthy.

And of course, he's making the same point about the American deficit, which is just how big a trillion dollars is.

A trillion dollars he worked out takes you back to 30,000 BC.

So

we're talking about deficit going into sort of 4 trillion plus.

Yes, it's rising by a trillion dollars every 180 days.

Well, talking of trillions of dollars, let's come back and talk about the UK economy, the spending review, and events in Britain.

Thank you very much.

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Welcome back to The Rest is Politics with me, Royce Hood.

And me, Alastair Campbell.

And by by the time some of our listeners are listening to this, we will have had the spending review.

For others, they'll be listening just before the spending review.

But I feel like it's been going on for quite a while.

We've had huge announcement about nuclear today from Ed Miliband.

We've had hints and leaks about more money for teachers.

We've had health going to be a big winner.

Defense is going to be a big winner.

And then you get the sense that some of them, particularly Andrew Reyner, Yvette Cooper, have been arguing right down to the wire.

And of course, you know, Andrea Rainer, let's not forget, we've talked about this a lot recently, one of the big pledges is 1.5 million homes.

Well, if you know she's going to be struggling again on housing and local government, hard to see where it happens.

So here's a question to start us off, Roy.

At the turn of the year, when we're doing our end of year, and you named Rachel Reeves as the worst politician of 2024, do you stand by that?

Yeah, I do.

I do, unfortunately.

It's an unfair thing.

I'm holding her to a very, very high standard.

But I think the question of who the Chancellor of the Exchequer is and how they envision policy is probably the most important job in Britain at the moment.

Because since 2008, we've basically been stuck in the doldrums, as everyone knows.

Our innovation's rubbish.

Our productivity is rubbish.

Our growth is stagnant.

Medium wages are stuck.

Highest growth in the G7 at the moment, Roy.

Yeah.

There's pathetically, pathetic sort of creeping ahead for a quarter.

Just out of Japan.

So

what does that mean?

It means that a government's come in that has said growth is absolutely central, laid out all these big missions, so breaking down barriers to opportunity, clean energy, superpower, safer streets, and above all, kickstart economic growth.

And the question then that's handed to Rachel Reeves is, okay, what's the big idea?

How are you going to do this?

What's the narrative?

What's the story?

So we know what that narrative was.

For example, with Margaret Thatcher, like it all though, that they had an idea.

They took the idea of a geeky economist, Hayek, they simplified it, made it retail, and it was privatized, deregulate.

Low tax.

Low tax, essentially.

And everyone understood what the story was.

And she communicated that story.

And there were lots of different ways of illustrating it.

She could illustrate in terms of household budget.

She could illustrate in terms of competition efficiency, et cetera, right?

Story.

Big bangs.

Same with you guys in 97.

Maybe not quite as sort of radical as Thatcher, but far more effective.

But nevertheless, there was a story that we were communicating, right?

And, you know,

your toes will curl when I start over-appraising the Will Huttons, the Michael Barbers, the people who saw themselves as part of the kind of intellectual driving force of it.

But nevertheless, we understood what it was.

Broadly speaking, we could understand from Blair, from you, from Gordon Brown, here was this thing, which was a third way.

It was going to keep the best elements of neoliberal economics, but it was also going to be more general with investment.

It had a story about equality and the way in which improving education would improve productivity and growth and create better consumer markets.

We had a story, right?

Since 2008, my goodness, there's been a real struggle for a story.

There was George Osborne's attempt at a story, which was austerity, which is now profoundly discredited.

Oh, I'm glad to to hear you say that.

And if you look, well, profoundly discredited.

Profoundly discredited.

We were defending it until recently.

Profoundly discredited, certainly in the popular mind and in the way that most people think about it, right?

Yeah, not a lot of the problems that Labour are trying to address now flow directly, I think, from austerity.

Maybe it does, maybe it doesn't.

But anyway, the austerity story has not been a popular one since David Cameron.

And in fact, if you actually look at what happened is,

and people have been teasing Torsten Bell about this, saying, you know, we've ended austerity when he actually posted a graph, which showed that austerity began to end really basically with Theresa May.

If you look at the graph, it's an extraordinary U-shape.

I think this spending review, though, is going to get us back just above austerity.

But we're still talking about very, very low.

Torsten Bell's chart actually shows that what happened is it was about 560 billion under Gordon Brown, drops down to sort of 500 billion in 2017.

And then the Conservatives begin to spend like drunken sailors.

Actually starts with May, continues with Johnson, continues with Zunak, up to 580 billion, so above Gordon Brown by 2023.

So they're taking over a world where already the Tories were spending more and more and more and more.

And you're absolutely right, Labour's intending to spend 600, who knows, £650 billion a year.

And this is going to be a big chunk of the economy.

government expenditure.

But what we don't, and this is what I'm getting to, why do I think Rachel Reeves is no good?

She's no good because we don't know what the story is.

How?

How is she she generating growth?

What's her answer?

Now, she's got ministers who had answers.

Before Torsten Bell became a minister, he wrote a lovely resolution foundation thing, which had a story.

Have we heard about any of that yet?

Do we know whether...

So let's remind people what the story was.

The story of that seemed to be, this is going to be about devolution.

This is going to be about local industrial policy.

Do either you or I know whether the Labour government is in favour of devolution and local industrial policy?

They say they are, and there's an industrial strategy coming along.

But listen, I'm not disagreeing with you at all about this lack of a big story.

So what that means is that when something like the winter fuel payment comes along, so the winter fuel payment was part of a story, which was we're getting a grip of public finances.

But the politics of the winter fuel payment became quickly very, very toxic.

So they've now sort of step by step.

I feel like

you've got a horrible sort of wound and they've slowly peeled off the plaster and it's still hurting quite a lot.

Whereas, I think what you should do in those circumstances is say, right, this has not been good.

It's incredibly unpopular.

It's probably fed into the reform doing so well in the local elections.

Rip the damn thing off.

It wasn't, it never raised that much money in the first place.

So the story of the spending review has essentially become all the negotiations.

You know, Angela Raina's not happy, Yvette Cooper's not happy, Bridget Phillipson's a bit happier than she was, all done like this sort of almost like a soap opera.

Now, that always happens, by the way.

That always happens around spending reviews because part of the process of spending reviews, although it was frankly, I think, counterproductive in our time, I think, Gordon,

if you thought you were pumping out your demands publicly, it would probably

not help your chances.

And actually, sorry, to be fair to,

I think, to Gordon Brown and George Osborne, they didn't actually allow the narrative around these things to be completely taken over by individual colleagues leaking to the newspapers their demands.

I remember with George Osborne, of course, the one that would keep coming back, which is relevant to a Rachel Reeves problem, was defence.

So every year, people like me would be out there saying we need to spend 2% on defence.

But apart from that, Osborne was generally able to get to these big events with control of the narrative.

Sometimes it went wrong, went wrong for him about his pasty tax

omnichambles budget.

But a lot of the time, there was a very, very clear story.

And my goodness, Gordon Brown was good at clear stories.

Gordon, you would always know by the time you got to the spending review what Gordon wanted to be the big theme out of it.

It might be child poverty.

It might be health.

But it'd always be clear.

And

that doesn't negate the fact that, by the way, there were some really difficult negotiations along the way.

I've actually brought you in a book, Rory, because I've read it.

I know you prefer a Kindle, but I don't.

So I'm giving you this.

You can have it.

I think you'll actually enjoy it.

It's very, very, very geeky.

But it's actually called The Art of Delivery by Michel Clement.

And it's the story, the subtitle says it, the inside story of how the Blair government transformed Britain's public services.

But it's about also how we matched the process of the spending review to the work of the delivery unit and the progress that was being made across public service.

And I think I'm really looking forward to it.

I mean, my sense on this is that sometimes it's a bit overblown, but that isn't really the key point.

We can quibble about what the detailed impact was.

There's absolutely no doubt there was a very, very clear story, which Michael Barber continues to tell to this day.

Absolutely.

And which we can see in this book.

And when it was sent to me, I thought, oh, God, you know, heavy stuff.

But actually, it's very, very readable, not least because she pilfers my diaries like hell.

However, what's the big story in this, which I think does relate to what's going on now?

And I had sort of forgotten this.

Our spending reviews, once we had the delivery unit in there, were very, very tied up with delivery.

In other words, money

if you were going to argue for resources, Mr.

Milburner Health, Mr.

Blunketta Education, I want to see, I'm Gordon, I'm Tony, I'm Michael Barber, David Miliband and Andrew Donis, who are part of the policy team.

I want to see how that is being done.

I want to see the metrics.

It's very, very interesting.

And I don't know

what the process is at the moment.

I don't know whether they're using the delivery metrics in the same way.

But it's a very, very interesting

and it feels different to me this time.

Well, it feels, and one of the reasons it feels different is that what you're looking at in this book and in 97 is a complete cultural moment where people were tired of Thatcher, John Major, and where you had this really interesting thing that we're picking up in a lot of our leading interviews of big labor beasts who had quite left-wing instincts moving radically towards focusing on efficiency, delivery, productivity.

So you can see with people like Blunkett, you can see with people like Alan Milburn this really interesting

creative tension between their commitment to social justice and their focus on efficiency and delivery.

Your hero, Alan Milburn, comes out very well from Mr.

Barber's Association.

As he should, as he should.

The greatest Secretary of State for Health, since Anarin Bevan.

The other thing, though, that comes out is the sense in which you caught a moment where you managed to align economic commentators like Will Hutton, technocrats like Michael Barber, but also the civil servants.

We interviewed Gus O'Donnell and he got it.

And John Saws, for example, you know, very much had the sort of Blairite attitude when he was coming in to do his stuff ultimately in MIC.

Yeah, because I, you know, obviously talk to

a lot of civil servants and I think they, I think it is this.

I think Keir's got a bit of a thing about the word narrative and

it's the sort of thing that as long as you get the the technocr you get the detail right and by the way you have to do that but you always need a driving story about the country on top of it.

And right now, you know, I was in the Channel Islands last week and I was doing a few events.

And at one of the events, somebody said, I'm really struggling to define brand Britain.

And she said, you know, when you guys came in, it became known as Cool Britannia.

But actually, what it was about was modern, energetic change.

people,

music.

It was all that sort of cultural stuff came together.

And now, look, where I think it's, we're both being a bit tough on them is I think the climate at the moment is harder, domestically and internationally.

I think it's a lot harder.

However, that doesn't negate the need for something that knits everything together.

Yeah, because what the politicians don't know at the moment is what their instincts are meant to be.

You're absolutely right.

What I'm being very, very unfair to Rachel Reef, and I'm absolutely certain that I would not be remotely able to do a good job in that role either.

She's facing huge headwinds.

Obviously, this is an economy that has been stuttering along and hasn't managed to get off its feet.

And we've had this incredible divergence with the US, which has now become much more productive, growing much faster.

And we're still trying to get ahead around why, what are we doing wrong?

And she's been hit by these thunderclaps.

So particularly from Trump.

Because it's not just tariffs.

It's also, of course, famously the fact that he's said he's not going to provide defense funding really to NATO partners.

So she's having to do something that's basically never happened in history, which is to increase defense spending and the NHS at the same time in an environment of low growth and an environment of high borrowing costs.

So really difficult.

But, but, but, but, but, but, this is where you really need great leadership, great vision, great narrative.

And of course, unfortunately, the populist right are pretty good at doing that narrative.

So, everybody can tell you what Trump's about, right?

He's about tariffs and low taxes, there's no doubt, and deregulation.

My goodness, that guy deregulates.

He's deregulating everything, right?

We can see what Javier Millé is about in Argentina.

Literally, he's there with a chainsaw.

He's tottering a bit there.

Hacking through.

He may be tottering, but the narrative is clear.

Nobody's doubt, you know, if you were, what's brand Argentina at the moment, we can see what Millet is trying to do right.

Macron's got a narrative, but it's again.

Macron's got that.

This is my point about politics being harder.

But I think sometimes what people do, and this is, you know, you get locked in to the day-to-day management.

What should we do about winter fuel?

What should we do about pips?

What should we do about the farmers?

And if you're not careful, that day-to-day becomes the driving mission of the government.

And suddenly you realise you're close to the next election and you haven't told that story about how the country's changed.

Well, let me give you a micro example to try to bring it to light.

So one of the problems that Britain faces is in our capital markets and in the stock exchange.

So the London Stock Exchange not been growing fast and quite a lot of companies listed on the London Stock Exchange now looking towards New York.

Big famous example is something called WISE.

It used to be called TransferWise, really interesting fintech company set up 2021, I think by an Estonian, important IPO because it happened at a television.

Absolutely.

What have they just done?

They've just announced that they are closing in London and they're instead listing on the New York Stock Exchange.

Ditto, when we get on to UK quantum companies.

So one of them has just a startup in Oxford just this week.

It's been announced has just been acquired by an American billionaire.

But perhaps more interesting, a data center which was listed on the London Stock Exchange to be bought by an American company, taken private, taken off the London Stock Exchange.

So, what does all that mean?

Well, what it means is that we need, and I'm going to be mean about the guy that's running the Financial Conduct Authority, because he's an example of the problem that Rachel Reese faces.

Competent, technocratically good.

But where's the big story?

Where's his analysis?

Where is the narrative of where is

Britain going?

Where's the narrative of

why are US capital markets performing better?

Why is America more competitive?

Why, despite all the disruptions of Trump, am I still hearing from European companies that go to the United States and are being told, come to us, we're open for business, we're deregulating, it's going to be low taxes, we're very friendly to capital, we're going to do big things.

What's Britain's response to that?

What's our story about why people should invest?

So there's a very good piece in the FTA the weekend from Andy Haldane, who was the chief economist at the bank of england so we're not talking a kind of radical lefty here okay and he did something very interesting which i used to do in when we were in in government which is

write the story that you want to tell to the country on the eve of the next election okay

and his story was about

a program that Keir Starmer brought forward in the summer of 2025 called Lifting Lives.

Okay,

he scrapped the two-child benefit cap.

He restored Surestart.

He had a massive assault on what he called the digital divide.

He did deals with tech companies and gave them tax reductions against the digital services tax to put computers into the hands of every child.

Every school had a mental health clinician.

And brackets, by the way, I'm hearing health is going to be the headline winner out of this spending review, but I think mental health is taking a back seat and it's not good he restored school careers advisory services to the levels of 2010 based on a scheme that's been pioneered in manchester he had tax credits for companies taking part in financing local businesses courses he had an expansion of degree apprenticeships he got gareth southgate to head up a national mentoring scheme and restore youth services football pitches libraries etc now of course you can say well where's the money coming from and what have you?

And that's why he's putting in the tax credits and he's putting in the deals with private companies, et cetera.

But I think that's an approach which I think the government should sit down and write that.

What do we want to say at the next election?

What have we done?

At the moment, it's stabilize the economy.

It's get more money into health.

It's get the waiting list down.

I get that.

I get the micro stuff that they're doing.

But at a time, you know,

Kierstama met Mark Rutter yesterday, the head of NATO, General Secretary of NATO, and he's talking about 3.5% basic defence spending, GDP, 5% total when you put in all the other ancillary defense spending.

Well, that's a massive commitment.

So they are going to have to make some very, very, very big decisions on tax and spending.

And back to my point about ripping off the band-aid, if the story you want to write in the next election,

what are the steps towards being in the position to deliver all that?

Do it now.

And what it can't be, I suppose, just to sort of bring this all together, is just about accountancy.

The chance that can't just be the kind of CFO balancing the books.

It's a role about ideas.

Yeah, yeah.

Final thing.

I got approached by something called Big Tent Politica.

Okay, this is a competition, Rory, which I think we should back.

Are you aged 16 to 18?

Do you have a big idea to change the UK for the better?

Enter the competition, Politica, Policy Ideas for Positive Change.

They've had a very big response, surprise, surprise, from private schools.

So, can we get the state schools out there?

We know we have lots of teachers and we have lots of kids.

You check these guys out online, Politica, P-L-P-O-L.

Can we see some of the entrants?

Because I think ideas is what we need.

No, and what I've said is that as part of the prize, so what they've got to do is a thousand words on an idea: health, education, inequality, social media, whatever.

And there are all sorts of things that you get for winning.

But I think one of the things we should do, we will discuss on the podcast the winning right idea but it's going to be genuinely meritocratic it's going to be the best idea you're not going to bias this in favour of you're not going to buy it you're not going to write you're not going to bias against the private schools on the basis i'm not a judge but whoever writes the piece explaining why the country would benefit from getting rid of all private education that is a big idea

okay well let's let's we have we said we were going to do the scottish by-election we said we can do bill and reform we'll do that in question time i think we should also talk about Greta Tunberg.

I want to talk about cyber security.

I know you

can do that as well.

Did you see Misha Glennie's?

You obviously didn't read the FTA other weekend, did you?

Because you had Andy Haldane, and Misha Glennie had an amazing piece about cyber.

Oh, well, good.

I'll look forward to discussing it.

Thank you.

See you soon.

See you soon.