The Iran War Exposed America’s Real Weakness | Sean O’Keefe

[00:00:00] Almost six months into the war with Iran, and Washington still having a hard time defining what winning was supposed to look like. And we're seeing the basic assumptions that have underpinned American foreign policy and national security in the post-World War II era fall apart one by one. They're falling over like dominoes. Good morning and welcome to the At the Water's Edge podcast, where we look for insights beyond the headlines and take a practitioner's view on national security and geopolitics. It's the 8th of September, 2026. Let's get started! Today, we're talking to Sean O'Keefe.

[00:00:30] Former Chief Administrator of NASA, Secretary of the Navy, and Professor Emeritus at the Maxwell School of Public Policy at Syracuse University, to understand what the heck did this conflict actually mean for the future of American foreign policy. With that, let's get to Sean. Sean, good morning and welcome back to the podcast. I believe this is the third time you've graced us with your presence. Pleasure to have you here, sir. Well, thanks. Appreciate it very much, Scott. That's very good of having me in.

[00:00:56] You know, I'm sure it's not gracing with presence, but I'm pleased to be here. I appreciate the invitation to do so. Thank you. Absolutely. We've had some good conversations, you know. So, you know, top of mind issue today is we're currently undergoing this war with Iran. We seem to be repeating this pattern of constantly finding ourselves at war without Congress actually declaring a war,

[00:01:22] which is a very interesting thing to observe in American politics going back generations now. But just broadly speaking, following the news, what do you think the current status of this war between us and Israel and the state of Iran is? That's an exceptionally good question that I have yet to hear anybody answer effectively. We're going to get it here first time, folks. No, you hit me with the real probing issue.

[00:01:51] I mean, first and foremost, I think the observation that has been made, I think, very broadly in the public domain on this debate is what was the objective? What are we trying to accomplish here? And it's the compare and contrast now to so many other events in modern history that have been focused in the course of plenty of editorials,

[00:02:21] plenty of opinion sections, all that stuff. It is telling that the sharp contrast, regardless of its outcome, is that every one of the circumstances in which, you know, heads of state, of the United States have taken on the challenge of deploying U.S. forces anywhere, has been first and foremost to articulate what's the point?

[00:02:51] What are we trying to achieve with this? And usually, again, this is the classic definition of use of the military as a foreign policy tool by another means. To say that this is a, when everything else fails, when everything else can't, you know, possibly yield the outcome you're looking for,

[00:03:18] then you've got to resort to this as a matter of principle if you decide that rises to that level of severity. And that's what every president has made the determination of, to do why we've been engaged in this. This circumstance is entirely different. There's at least a half a dozen reasons that have been attempted to be floated after the fact to any of this.

[00:03:47] There's been zero, you know, much as I'm not a huge advocate of lots of congressional, you know, engagement on this question and all that beforehand. It nonetheless is an incredibly prudent move to assure that you bring the, not only the American public along, but all the institutions of power to understand this is why we're moving in this direction.

[00:04:16] It's that serious that it merits that kind of consideration and outreach. So much as, you know, in my times in the administration, consulting with Congress before you went off and did something, was always one of these labors that you just thought, boy, gosh, you know, I'm talking to a post here.

[00:04:39] At least this was something that was the intention to get the understanding out there and reach some conclusion moving forward. So, and hopefully attain some consensus on a broader public basis. None of that was achieved. And so as a consequence, this is, you know, we're really in this, you know, ill definition of what the point is.

[00:05:06] And how do you define what constitutes a win in a situation like this? Win or a loss either way. Yeah. It only feels like at this point, a win is just ending the current conflict one way or the other. But we don't even have the ability to compel or offer a carrot to Iran that's big enough to get them to back away from their position.

[00:05:30] See, does America have any good options at this point to either coerce or bribe Iran into ending this conflict? And the best we can hope for at this stage in the game, from what all everything seems to indicate, is to get back to the status quo where we were before it all started. And that is just depressing.

[00:05:51] I mean, to think that we would go through this, inflict this kind of destruction, agony, and all the other consequences that had been out there, which are many, well beyond just the immediate impact of this war, which are horrific all by themselves. There are a whole range of other issues as it pertains to our relations with other nations,

[00:06:20] our relationship and the broader public relationship with the military, the United States military, that if they're viewed as you can do this for any period of time you like and they will put up with it, we're going to find that's wrong. Yeah, this is a fragile moment here that we're dealing with. And the consequences of this, we're just now beginning to talk about some of that.

[00:06:51] How do you do this? How do you explain to thousands of troops who've been sent over to the Mideast region for an almost indefinite period of time with no specific objective that has been laid out to say, this is the goal, not just for today, not that target, not that particular. The broader goal we're trying to achieve is as follows. Can't even articulate that.

[00:07:22] We're really treading on thin ice on this because there's going to come a point, and we're starting to see elements of it, where folks deployed are saying, what am I doing over here? And folks back home who are waiting for them to return saying, what was the point of why you were there? All those different factors all are an impact of what we're doing here,

[00:07:48] not just the immediacy of this very specific set of relations in the Mideast. This is something that is much wider than that. And then the relationships with allies, we're going to spend a generation trying to rebuild that.

[00:08:08] And it's just, this is absolutely phenomenal to see the fallout that's occurring from a lot of this for no gain. Let me ask you about the lead up to this war, because you pointed out that the administration really made no effort to build public consensus about going to war, conferring with Congress, everything else. But it, you know, it occurs to me looking back, you know, we did Afghanistan. It was a forever war.

[00:08:37] Very understandable post-911. We can argue that we overstepped and got stuck into a quagmire. That's a very, based on the struggle that we have, it was, you can say it was a mistake, but it's a very understandable mistake how we got into that situation. Then we can look at Iraq 2003. That one was a bit more, we shot ourselves in the foot there, chewing up more than we could do based off bad information, bad decision-making, even if we remove the assumption that there's any nefarious intent. Oh my God, did we screw that one up for all the wrong reasons and got nothing for it in the end.

[00:09:08] But in both of those instances, Congress was conferred prior to starting those wars, and Congress sat back and watched it happen and paid for it. Do you think that if the Trump administration had made an effort to go to Congress and failed to get public support, do you think that would have in any way constrained the executive branch from making the decision that they wanted to make anyway? That's a fair question.

[00:09:33] And I think the answer that the president came to was, why bother going there when I don't intend to really act on that particular input anyway? That's kind of the way this has been treated. And that was a determination made before the fact. That said, the hypothetical of when or not there had been an attempt to consult with Congress,

[00:10:03] move forward, at least to try to build a public consensus in some way, if that had, you know, would have impeded an awful lot of the objectives. That's hard to say. First of all, again, you got to go back to the premise. What's the objective? We're trying to stop nuclear proliferation that was already obliterated? Is that what the idea? I'm not sure how many times we've destroyed the Iranian nuclear program at this point, but there's a lot of check marks on that board.

[00:10:33] It's very impressive. It really is. It's been declared, done well before the circumstances. And yet, I mean, this is like Lucy with the football, you know. We're up there, you know, just playing it through every time. And it's repeating the saga. And I think there's a broader electorate object lesson that comes from this, too,

[00:11:01] that is really quite important to derive. But it is, you know, in the end, I think this is something that we're going to have a very difficult time moving out of and recovering anything in the course of the effort to do this.

[00:11:18] And right now, we're going to have a blockade in place that is designed to maintain the status quo is for nothing to move in the Strait of Hormuz. I mean, that's one accomplishment. The number of people around the country who have learned where the Strait of Hormuz is and what the significance is of the Persian Gulf is quite remarkable.

[00:11:47] But, boy, what an expensive education. You know, it's very heartening to see the Trump administration invest so much in the public education system in America through a nontraditional means. It's astonishing. It really is. But, you know, it's how we move through this. I think in part, you know, the other elements that are in play here is one of the favorite strategies, such as it is,

[00:12:14] it's more of a public relations strategy, is as soon as things are not moving in the right direction, change the topic as soon as possible. So now we're declaring a trade war with the Canadians over. Yeah, because that's really high in the priority list. Trade war with the Canadians. That's okay. That's good for everybody. That's it. But it's certainly taking the Iran war right off the front page.

[00:12:40] I mean, it's now suborning that question to a series of other debates and ballrooms and whatever else in order to attract the attention. I mean, this is one of the most elaborate watch the birdie tricks that we'll ever witness in a circumstance like this.

[00:13:01] But it is going to be an extremely difficult challenge to repair just the alliance relationships that we have had since the end of World War II that have been developed to a point where that was formidable.

[00:13:20] I mean, you know, the broader question, and this is not one point that you've asked, but I think it leads to this, is part of what has made the United States successful, even in the moments in which, as you pointed out, in Afghanistan and Iraq and so forth, Vietnam,

[00:13:37] every one of those circumstances where those incursions have failed and not succeeded to achieve the goal that it was set out to do. Nonetheless, part of what we have attained is relearning a lesson that, unfortunately, the American historical habit seems to be our memory only goes back so far,

[00:14:05] and it's short, but what that continuing lesson is, we do have an unbelievable capacity and capability without ever firing a shot to motivate any belligerent, anybody who is seeking to help anybody who is seeking to help anybody who is seeking to help anybody who is seeking to do harm in any nation state or in any condition, even if it's not a nation state, terrorists, to make a determination,

[00:14:35] that we have the capacity to strike back and respond to it and be very thorough about that. That demonstration of that, you know, awesome capability is usually more than sufficient to moderate behavior without ever firing a shot. I mean, the Cold War is a testimonial to that in and of itself.

[00:15:02] Years and years of that particular conflict. It was played out in many, many venues and lots of diplomatic wrangling and all matter of challenge. Nonetheless, yielded a point where the then Soviets made the determination that we can't win this. This strategy isn't going to work.

[00:15:28] We can't keep throwing an awful lot of volume at something that is now a technically superior capability that we will never defeat. And as a consequence, it yielded the result we were looking for at the end of the Cold War and the circumstances that followed thereafter. In so many ways, we're testimonial to precisely that capability.

[00:15:53] And that's based on not only our own capability, but that of our collective alliance partnership arrangements around the globe. And our willingness to ally, be aligned with other nation states with common interests when we define what those common interests are. And then in turn, you know, move together to achieve those. That becomes a powerful demonstration of our resolve.

[00:16:23] And what has made the United States, I think, as dominant on the world stage as it's been. Sometimes by our own, you know, condition have been brought into situations we'd rather not be there for. But that becomes part of the responsibility. And that becomes part of the consequence of the, you know, the real supremacy that would have been established in that case.

[00:16:49] When we do this kind of situation where we fray every one of those alliance relationships, we're going to get the reaction that we're witnessing by little degrees right now. Which is folks saying, wait a minute, the last time, you know, I asked for your help. You weren't there. And this time, you insist that I get involved in something I have no particular involvement with.

[00:17:14] So even the South Koreans now are in the mode in which they're being told, unless you participate with us in a part of the world that you have no specific engagement in, which has been done. Nonetheless, you know, we're going to take a retaliatory effort to withdraw from exercises.

[00:17:38] These are the kind of things that, you know, where we shoot ourselves in the foot as a demonstration of what? Well, let me ask you this, because we've seen this, you know, during COVID, we saw how brittle supply chains were. We've hauled out the American manufacturing base. You know, we can't produce naval ships, Patriot missiles, any of the hardware for warfare. We have one of the most innovative economies in the world, but we're drastically behind on our ability to innovate and produce drone tech at scale.

[00:18:07] Iran's eating our lunch there and making our carrier task force look silly. And we're seeing, you know, we talk about interests. We're seeing the shift from a unipolar world with America at the top to a multipolar world where China and Russia can provide regional alternatives to the American world order. And perhaps Iran's going to join that group now, too.

[00:18:28] But do you think all the fallout that we're seeing from the war with Iran, the fraying of alliances, the revealing of conflicting interests among previous partners, is this, is the Iran war the cause of these changes? Or do you think the Iran war is revealing underlying changes that were happening already and were getting to a point we would have gone to inevitably in 20 years just today? That's a great point. I think it is the latter.

[00:18:56] I think it is the latter.

[00:19:26] As a result, that's motivating not necessarily alliances with those who are belligerents. That's for sure. Although some of that's happening, too. But it's not on a wholesale basis.

[00:19:40] I think it's more best described by Prime Minister Carney's Davos speech that he did of describing the need for middle powers, as in those who are nation states which have some capacity.

[00:19:59] When allied as allies can in turn affect trade change as well as significant national security or international relations kind of conditions which are more conducive to the country itself. And that's a thoughtful articulation of the alternative, which for our purposes is disastrous.

[00:20:29] That's exactly opposite of what we're looking for. I mean, what we're trying to do is maintain a common set of interests and therefore a willingness to step up in a common fashion to defend those interests because they're both in our best interest as opposed to, you know, something in which we're dictating the terms and condition of why our partnership should exist.

[00:20:57] And that's the part is frayed pretty hard as a result.

[00:21:28] We're going to have done an unbelievably spectacular job of putting them on the world stage. I mean, we have basically reduced them to the point of saying, if you're going to behave like this and you're going to threaten this kind of a nuclear condition, threat around the globe constantly and certainly within your region, we're going to basically ostracize you. And what we've done is dead. Quite the contrary.

[00:21:56] Put you right on the center stage. And you bet. Let's go engage on this for little to no gain that has come from that. I mean, all the things we're attempting to stop on this. We now have a nation state with a significant nuclear ballistic missile capacity.

[00:22:17] I mean, 60 odd missiles that they're very proud to proclaim are at the ready and capable that 10 years ago did not exist at all. Do you think America needs to rethink its approach to counter nuclear proliferation? Because, you know, North Korea is an interesting example. Around is an interesting example. One thing that seems like something that we don't really wrestle with is that nuclear weapons are really, really, really old, antiquated technology.

[00:22:45] And even the ballistic missiles they fly on are old, antiquated technologies at this point. It's impossible to imagine any nation state actor that wants to develop that capability isn't capable of developing that capability. Is it even a reasonable policy rule for the United States to have to try to prevent through coercion and nation state anywhere from developing nuclear weapons? Is that even something we should pursue at this point? No, that's a great point.

[00:23:11] I really believe we've got to make a shift somewhere to change that dialogue because this isn't working anymore. There's no doubt about it. It was all designed, the whole strategy and the whole focus about nuclear capacity was based on the premise that the United States and the Russians,

[00:23:35] only two nation states, would have the depth of capacity and capability in volume to actually create that kind of tension and follow through on it. I mean, again, this gets back to the point I was making earlier, which is the use of that capability in and of itself is almost a defeat.

[00:24:02] You want to leave the proposition that you might use it out there as a deterrent to certain forms of behavior, moving everybody in the direction you want. Unless you do this, we're going to do that. We could have the capability to do that. And that was successful for 75 years. It did work, you know, to deter a lot of really bad news behavior.

[00:24:31] That said, there's no longer two of us. There are a wide range of capabilities out there. And so, as you correctly observe, the strategy and the global kind of focus on the thermonuclear capabilities that nation states develop has really degraded to the point where you've got multiple,

[00:24:58] half a dozen other actors who are quickly becoming much more capable of doing so. And won't be acting with the same level of care and responsibility that has been demonstrated in the last 75 years. The age of this capability, though, is one that ought to be really alarming. Yeah. Because there's no doubt about it.

[00:25:25] There is the opportunity for incidents, accidents, and just bad luck is rising because of the sheer number. Do you think there's any future where five years from now, Iran doesn't have a capable nuclear weapons program? That's a great question.

[00:25:53] I don't know that it's necessarily a given that they will develop this. I mean, in as much as this latest incursion is a complete, you know, it really has set us back a lot in many different directions.

[00:26:15] I think among them, the only thing we can suggest is while not obliterated, even though we were, you know, joking, I think, earlier that that term has been used rather widely. It hasn't. It hasn't been eliminated. There isn't a situation where it's gone. But we've set it back significantly. There's no doubt about that. But it comes to the stage of asking the question of what's the point?

[00:26:45] What are they trying to really achieve with this? And they're seeing, you know, the Iranians are seeing and have seen for many decades now, since their revolution in the 1970s, that the exercise of power is one, again, in which sometimes you don't even need to exert it. All you need to do is develop the capability to do it.

[00:27:11] And that, in turn, will move the debate in a different direction, improve your position, make you a much more, you know, influential player in whatever regional or broader theater responsibilities and aspirations that you may harbor. And they have harbored a lot of them. I mean, they have hoped to really expand a lot.

[00:27:38] And it didn't quite turn out the way it did. But the disconnect that's there is consistently over the last, you know, since 19, late 1970s, since the revolution itself, the mindset, and at least the purpose of doing so, that brought the entire population along was democratization.

[00:28:02] The notion that they would have a greater opportunity to have a say in their own self-governance. Well, that hasn't materialized at all. To the contrary, you know, that the leadership of the nation state has, and the Iranian mullahs and everybody else that have been involved here are all very much involved in sustaining their totalitarian capability.

[00:28:30] As in, at all costs, we're going to keep the upper hand. We're going to maintain that. Even to the point where they have demonstrated their willingness to thin out their own citizenship by, you know, assassinating thousands of their own citizens, you know, who are resisting that point. So this is something where we really haven't changed that behavior one inch.

[00:28:59] But they've used the nuclear argument as a means to push off other regional threats, as well as theater in the area. Mideast range more broadly, meaning the Israelis, to be deterred from really threatening their authority and their leadership capacity.

[00:29:27] That was part of the idea. And I don't see them resigning from that aspiration, okay? They're going to continue to try to maintain that, even though the fundamentals and all the basic capability is now buried under tons of rock in the mountains there.

[00:29:54] It's going to take some time for them to recover that. But they've shown a persistence, an unbelievable persistence to keep, you know, moving forward on that larger ambition to be a theater power. Yeah. And it's going to, they're not going to go away easily. That's for sure.

[00:30:19] You know, you keep using this word, and I appreciate it, you know, looking at where our interests align with allies and working towards those common interests. But it seems to be every time that folks in the media or folks in government go to sell a proposition to the American public or even on the international stage, it's rarely about the language of Harris, how our interests align. It's always about how our values align. You know, Afghanistan, Iraq, democracy in the Middle East, all that stuff.

[00:30:49] The Ayatollahs are evil in Iran. You know, Israel's the only democracy in the Middle East. Forget about Turkey and some other folks. But there's always this language about values, not about interests. What is it that you think that makes it so difficult to have a conversation in the U.S. government and formulate policy around shared interests? Because I think back to, you know, 1970s, we had an interest with China to counter the Soviets. So we aligned with China temporarily. We seem to be very good at this for a very long time.

[00:31:19] And since Clinton was in office and we had the unipolar moment, it just seems to be atrophied from our institutional thinking. No, no, that's a really important point. And I'm not blaming Clinton for that. I'm just benchmarking the timeline, though you could blame him for plenty. No, that's exactly right. I'm of the same mind. And again, this is the U.S. kind of relations is a topic of discussion all by itself.

[00:31:48] I mean, there's a valid argument to be made for really being extremely careful with what that relationship ought to be. Because our interests are threatened by much of what they're capable of doing.

[00:32:11] And their capacity, which is where the values issue comes to play, to demonstrate their willingness to threaten those interests, demonstrates a big breach between their values set and ours.

[00:32:32] In so many ways, you know, the democratization of their economic, you know, trade and focus and so forth that they've embraced now in the last couple of generations is a means to continue to leverage their own capabilities moving forward.

[00:32:58] In other words, build the economy by working with folks around the globe in order to achieve that. But when you look at those relationships that they're trying to establish with lots of different partners around the world that they typically hadn't dealt with in Africa or South America or anywhere else, it's all about how to really support their own interests, period.

[00:33:28] The values that go with that are ones that they look at as being contrary to what many of the different partners that they're working with espouse. And so, as a consequence, this is transactional. Very transactional. I think that becomes the key or answer to the broader question you pose, which is why we always look at this from a standpoint of values versus interests.

[00:33:56] Because if you can't establish what the values are, your interests will all be transactional. They'll all be in the moment. They'll all be based on today events.

[00:34:08] And in part, I think you could argue that that's kind of what we're witnessing right here on our own national agenda is a demonstration of values taking a backseat relative to what we perceive, or at least the leadership perceives, are our interests to go pursue.

[00:34:32] So, every one of these, let's change the topic issue to go after the Canadians to tell the South Koreans we're not going to work with you anymore on joint sex exercise. All those different things are all based on reactions. And it's all transactional. And it's all based on the interests of the moment. Well, for that, too.

[00:34:56] So, at what point are we talking about interests that are short-term versus interests that are long-term? And is it that the values and the way that you're looking for is really just long-term interest? Like, I might be able to pick a fight with my neighbor about getting his fence moved six inches closer to his house than mine. But if I need someone to watch my cat next summer while I'm on vacation, what do I really care about here?

[00:35:21] Is this that values are being used appropriately or just that we're looking at our interests at the wrong timescale? That's exactly it. I mean, it's establishing, again, what we had developed as a much more conventional methodology of alliance arrangements was identifying what were those shared values that we had.

[00:35:48] Again, and the principal one, the primary anchor was democratization. Well, let me challenge you on that because if I think of the most successful alliance structure in history, NATO, from a military standpoint, you know, I wouldn't argue that NATO was based off of a common set of democratic values. I would argue that NATO was based off of not wanting Russia to control all of Europe because that would be a continental power that America couldn't contend with. In part.

[00:36:17] I mean, again, it served the interests as well. And certainly today, based on today's scenarios, Putin has had a tremendous, you know, contribution to the task of really building and strengthening the NATO alliance. They've all got together and said, there's the problem. It's not a hypothetical. We know what's going on here.

[00:36:42] And they're seeing the Ukrainian situation and identifying that as an example of why it is he could rationalize just doing anything he wants to do. So we better get together and lock arms on this. Absolutely fair point. There's no doubt about it. In this moment, in this time, those interests are aligning. He's going to have defined where is the problem very clearly, at least in the European mindset.

[00:37:11] And the strength of this alliance is, you know, stronger than ever. And we haven't seen it like this in a long, long time.

[00:37:19] And to his credit, you know, the harping that the president has really continued as a drumbeat for the past 10 years over the NATO alliance requiring to be contribute a lot more to their own collective security and so forth,

[00:37:42] is a valid argument that has been heard and reinforced by what we see as the consequences there. And they've risen to that interest based on those interests as well that are common. But the values, I would contend, still are based on a pretty deep, you know, grounding in democratization.

[00:38:09] Are there examples where some NATO partners don't exhibit it quite the same way as the rest do? Yeah, you bet. I mean, the Turks, certainly the Hungarians, you know, others have demonstrated that, well, you know, this is a alliance of convenience in many ways, more than any way.

[00:38:31] But at the same time, they also are, you know, recognizing that this is an opportunity for some leverage in the broader geopolitical sphere, that they can be heard more loudly by their alliance that they move forward with.

[00:38:53] And that's partly why, you know, again, the Turks have decided to maintain their alliance here overall. But in terms of the inextricable link between the basic values and the secondary issue, I think, that is probably as prominent in some ways as democratization, is just an adherence to capitalist structure.

[00:39:23] And that's the way, you know, the West has aligned very clearly on this point.

[00:39:33] And now we're looking at how this trade alliance is being fractured by the reintroduction of a basic tax principle of tariffs that has demonstrated throughout history to be unblemished by any success, including now. It moves behavior in a totally different way. But it's using the economic power as a weapon as well.

[00:40:03] So I would actually make an argument, a security argument in favor of tariffs as a concept. Let me run this by you and see what you think. I think one of the things that we've observed with the war with Iran is that America's ability to project power is based off of a series of military technologies that were developed in the 1980s. And we've been fighting with the same suite of large scale weapons, carriers, tanks, broadly fighting vehicles for 50 some odd years. Yeah, we plugged in F-35s and some new cool toys and Reaper drones. And that's lovely.

[00:40:33] I would trace this back to, like, we stopped innovating in defense when we consolidated into the big five defense contractors. I believe you actually have a 60-minute segment from way back when where you were talking about that. But I think downstream of that, we have hollowed out the American industrial capacity to the point where even if we develop weapon systems, we can't build them. I mean, we still haven't caught up to producing 155-millimeter shells to replace or keep up with the needs of the war in Ukraine. Because we still have one factory.

[00:41:01] We can't even build a new factory to recreate World War I technology. I would make the argument that America needs to have a much more robust manufacturing capacity. And one of the only ways that we can get the private investment needed to do that would be through something like tariffs.

[00:41:19] I think there are a range of economic levers that could be availed long before you ever get to the use of something that is really a tax in order to motivate others not to consume. That's what the whole idea is. The tariff itself, I forget about this argument that has been attempted to be, you know, fomented, which is it's a money raiser or a tax revenue raiser.

[00:41:49] It's a net nothing, you know, and if anything, it's worse by virtue of the fact that the consequences that bear on the U.S. economy are every bit as retaliatory.

[00:42:03] There is, you know, every nation state that has been inflicted with very specific tariffs of some amount have in turn then reacted by moving their consumerism to a different source in the capitalist market. And as a result, they're buying steel or whatever else from another source.

[00:42:33] That was arguably higher before the tariffs were inflicted. But now suddenly are much more attractive, even though they're more expensive than they were, than what the cost is of going back to the United States with a tariff implementation on top of all of it. So, you know, this is the consequence where we're distorting economic principles.

[00:43:00] And when we attempt to lift them, what amazingly happens is the price doesn't come down dramatically relative to that. It sustains itself because it's been reset by this artificial means. And that's the whipsaw we're dealing with right now. We're pricing ourselves out of the market in many areas. To your point, though, it's bigger than this. I would agree with everything you would just say.

[00:43:27] I would just say I would prioritize industrial resilience over growth and balance sheet health. Because, right, the tradeoff here is absolutely lower GDP. It is a net negative on the economy. That is an absolute tradeoff that we would have to accept. And that's what it is. But the point that you raise, I think, that has got an awful amount of value to really thinking through.

[00:43:55] And again, I think the administration right now, to its credit, to give it its due, is attempting to think about how to reestablish that innovation that had dominated in the U.S. economy going forward.

[00:44:14] And so I would likely, the same administration that is giving us, you know, a positively deterring kind of trade relations condition as introduction of tariffs, okay, is also the same one that is looking at how to motivate diversification

[00:44:37] and a wider range of applications, which, frankly, really promotes what technology development does best. It takes a fundamental technology that, once formulated, developed, and inserted into a product, seeks all kinds of unique ways to be applied to other systems.

[00:45:03] And then you find that it becomes a ubiquitous capacity that is applicable in many, many different market structures. That's what they're trying to really develop here, is to look at how you can promote within that broader industrial community

[00:45:28] as much innovation as possible that, in turn, is taking really promising technologies and inserting them into way different market development opportunities and building new markets. I mean, you know, my all-time favorite on this one was the capacity at, you know, DuPont to develop Kevlar.

[00:45:57] Their whole focus was all around, here's how we could develop a polymer and a capability that's got greater strength and capacity and all this other stuff than any other thing that we've made. And we could positively apply this to something that needs this, like reinforcing tires. And that's the market they went after. And they attempted to sell to all the tire makers, BF Goodrich and Michelin and everybody else,

[00:46:26] this notion of making Kevlar belted radials. And they looked at that and said, gee, that's a really brilliant idea, except for the fact that it's going to cost $5,000 per tire to do this. It's like using titanium refrigerators.

[00:46:54] I mean, it just was just a market anomaly. And it kind of left them sitting there figuring out where in the hell are we ever going to apply this capability that is just unbelievable until they then awakened to that and said, no, no, no, leave the steel belted guys to go to the tire business.

[00:47:15] And instead, we will look at developing markets like building this into the interiors of aircraft that make it fire resistant when a fire breaks out quickly. The reinforcement for law enforcement and military equipment, helmets and gear and everything that's lighter,

[00:47:41] all the different functions that we see of what Kevlar does now and how it's included in so many different things is what has made it their biggest opportunity. And it only came above because they applied it in an entirely different market set.

[00:48:01] And it turned out to be a huge winner that really propelled the polymer market within DuPont's sales packages and everything else to the point where it has now sustained itself for decades. So, you know, it's gotten stronger and more applicable and everything else.

[00:48:22] So, that's the kind of mindset I think that the administration is promoting to say, let's utilize, you know, capabilities in entirely different ways. Watch what's going on with how by acts of desperation and necessity,

[00:48:44] the Ukrainians are resisting an incredible force and capability using cheap drones. I mean, how is this working? And now, all of a sudden, a new market is developed on the basis of understanding that capability and thwarting what could be a much more expensive set of options. So, rather than looking at the tire market, let's look at, you know, some of these other options of where this could go.

[00:49:14] And that's what they're really, really diverting at this stage and refocusing the attention of so many different innovative opportunities. It's, you know, the development of the arsenal state, which is the consolidation of big industry that you referred to earlier, has had an effect of so many ways the provider, the manufacturer,

[00:49:43] beginning to think more like the customer does. And the customer in this case is the government. And the government's got a very specific set of standards and rules and specifications. And they're thinking the same way because that's the primary customer. And we can't be surprised when you get the same answer coming out of that time after time.

[00:50:09] Whereas the approach that I think is being formatted within the industry now is now you're finding a lot of industry options that are applied to entirely different market segments because they're being encouraged and actually underwritten to go do so. What do you think America should approach its role in the world after this conflict with Iran? Is it we need to go back to being the number one dog global superpower?

[00:50:37] Do we need to accept the rise of other great powers, at least at a regional level? Do we need to reestablish the old world order and the banking system and keep the dollar the reserve currency? Or are there certain key alliances we need to make sure that we maintain while allowing slippage in other areas? Yeah, that's the eternal question. I think what we really need is some reflection of exactly where we are.

[00:51:03] We've been spending a lot of time, again, on the opinion pages and Sunday talk shows and podcasts. God bless podcast. Forget everything else. Just podcasts, folk. That's it. And the show Substack, podcasting and Substack. That's great. Also on YouTube. Everything else can burn. Nothing else. Well, we've spent a lot of time in all these settings reflecting on how we got here.

[00:51:30] And what's going to be required is to just pause the button and think, okay, this is where we are. What is it we want to try to either reestablish or reform or transform to in terms of our capability?

[00:51:52] And there's no doubt, you know, regarding what we're learning in this period on the upside is the economy is unbelievably resistant. It is. It's unreal how resilient it is.

[00:52:07] It can withstand all the shockwaves that have been thrown at it and yet at the same time still maintain, you know, that capacity, which is, I think, a validation of, you know, the economic principles we've all embraced in the West.

[00:52:26] Now, the catch is, in doing so, how do you then figure out how to employ that to come to the fundamentals that we talked about a little bit earlier in the conversation of what are the values that would motivate us to really involve ourselves and what are the interests that will be served by doing so?

[00:52:55] So, that's a good model framework of how we have to really reflect on this. And now, I think the idea of going back to being the, you know, the world superpower, right? No. Not only is it not conceivable based on our own aspirations, that's obviously not one of the principal roles that we have. It's a matter of history that the U.S. has looked to.

[00:53:23] But at the same time, it also says we've got to really rethink this nationalism and nativism that we've slid into in the past decade to be thinking, okay, you know, the oceans that separate us from the rest of this chaotic world are going to protect us. That isn't true at all anymore. Many more.

[00:53:49] It's the same technology that we've talked about in part that has made all of this geographically insignificant of how far away you are. And it is not a buffer.

[00:54:04] It is not the capability that we, you know, thought would separate us from all of this that had been the source of so many different, you know, historic references of who has advised against entanglements and everything else. No, no, no. Those entanglements now happen in a nanosecond simply because of the way the technology has changed.

[00:54:30] So it is – I think we've really gotten to the stage where we've got to reflect on how does a national strategy and national focus put us in that position? And the idea that we can, at our own will, suddenly dominate a market, those days are likely not going to be around the corner anymore.

[00:54:55] So how do we maintain our ability to be competitive in that market environment? And fortunately, we're starting with an incredibly resilient and very resistant economy that has demonstrated its ability to withstand an awful lot of shock, you know, along the way and still come out the other end with a reasonable opportunity.

[00:55:20] But it is one that we've got to think about all the other things that attach to that, the equities that go with that.

[00:55:29] How do you equalize this so that everybody comes along with you rather than creating progressive conditions of more haves at the expense of more have-nots that have really, really polarized this country to the point where an awful lot of the origins of what we see today is, you know, originates from that particular division.

[00:55:57] So this is going to take some reflection. I think anybody who gives you a snap answer on that question, you've got to wonder where that's coming from. Is the realism of saying let's go back to where we were is impossible and, frankly, not particularly desirable? I think we've got to move back past that in any event.

[00:56:23] It's the same mindset that created some of the divisions we're seeing today. Yeah. Well said. We're coming up on time. I really appreciate you taking the time this morning to speak with us. Now, is there anything that I haven't asked you about yet that I should ask you about while we're here? Oh, shoot.

[00:56:41] I mean, Scott, we could probably examine a multitude of other issues along the way, but I think you've done, you know, a commendable job of really trying to focus on the kind of areas that, you know, have a bearing on current events today that are describing this conflict that we're into right now.

[00:57:09] And what the results are is much more extensive than simply the question of how do we get out of this particular war? Well, how you get out of it and how you work your way through the Middle East conflict with Iran is going to take an awful lot of time and reflection to think about that. And one of the things we've got to resolve to is we've got to establish what the point of the exercise would be.

[00:57:38] And that is something we're still a long way away from doing. So thank you for that. I think it's really a very thoughtful opportunity to reflect a little bit on that. Well, it's always a pleasure to talk to you. Thank you so much for coming on today. And you're welcome back on anytime. Just let me know. Thanks, Scott. Appreciate it very much. Take care of yourself. Take care of yourself. Thank you. Take care of yourself.