Bulwark Takes - Oil Hits $100/Barrel as Iran War Escalates (w/ Paul Krugman) | Receipts Live

Episode Date: July 24, 2026

Join JVL and special guest Paul Krugman (filling in for Catherine) as they cover the week's biggest stories from the world of economics and finance.Make today a good day, and get yourself some Soul gummies. Right now, Soul is offering 30% off your entire order! Go to https://GetSoul.com and use the code BULWARKTAKES.For more on Catherine's original reporting, check out her latest Receipts newsletter on how the Trump administration is conspiring to exclude millions of immigrants from the 2030 census: https://www.thebulwark.com/p/inside-trumps-stealth-trick-to-rig-census-and-congress

Hello, everyone. I will introduce my esteemed guest in a moment. I'm JVL and my receipts live colleague, the great Catherine Rampel, is out today. But even though she's out, she's been working. And she has a piece that just dropped that I cannot urge you strongly enough to go read. What is going on is she's breaking some news here about some monkeying that the Trump administration is attempting to do with regulations and processes within the, next census. And the short version of this story is that they're trying to make it so that immigrants both authorized and legal, sorry, unauthorized and legal, will not be counted as actually living in the United States for the next census. There is a long version of this story. The

implications of it are enormous. She's got the long version. Please go give it a read. This is one of those things that the administration is trying to do under the cover of night, and the more light intention it gets, the better. So go read it, share it, try to make sure other people see it as well. I am joined today by my friend, a guy, I'm a real friend, but a guy who's been on the show before a couple times and who I am a great admirer of. The great Paul Krugman, he doesn't really need an introduction. But if you don't know that he's on Substack now, you should go to Paul Krugman.substack.com and sign up for his newsletter. It's fantastic.

And Paul, we were just talking in the green room about how prolific you are. You've got a motor in you, and it's amazing. You're not doing like, you're not building model ships. You're not golfing. That's right. Creating great newsletters. Yeah. I'd probably be a happier person if I golfed.

But anyway, here we go. And it's keeping me busy. But also hopefully, yeah, anyway, I love to, you know, bulwark is a great resource here. we are. Well, it's great stuff. So today, just a quick roadmap for people. We're going to talk about oil and the Iran war. We're going to talk about tariffs, the bond market, and oligarchs. It's going to be great. Let's start with Iran and oil. Paul, you just wrote, I think it's the day, or maybe it was last night, about how we are now up oil back over or just about over $100 a barrel for crude. And this is a result of the fact that we're back into the war. And we're, and we're

back into the war that Trump can't seem to get out of because, as you say, he lost this after about five days. And it was clear to everybody that we had lost after about five days. But what I want to ask you to talk to people about here is something you call the crack spread. And your thesis is that, you know, the actual oil per barrel price is $100, but what people are paying for gas, especially diesel, is more than that. And that's because of this thing called the crack spread. Can you explain to people what's going on? Yeah.

So, you know, nobody burns crude oil. It's, you know, fill your engine with crud very quickly. So it has to be refined. And roughly speaking, every three barrels of oil gets turned into two barrels of gasoline. And then there's 42 gallons in a barrel, which is one of those weird things. But anyway, and one gallon of diesel, one barrel of diesel. one barrel of diesel. And normally the price of the stuff that's refined out of a barrel of oil is something like $25 a barrel more than the crude itself.

That has blown out to something like $65 now. So that's the crack spread. The difference between what a barrel of oil costs and what a barrel of stuff made from that barrel of oil costs. that has, and from the point of view of end users, which is you and me, but also businesses, also, you know, logistics, all of that, what matters is what it costs to buy the stuff, the refined products, not the oil. And so if the crack spread blows out the way it has, that means that for all practical purposes, the price of oil is a lot higher than the number you're seeing, you know, in the corner of your TV screen. and that we kind of know why that happened. It's refinery capacity. It could be, you know, it could be market power by oil companies,

and you don't want to ignore that, but really this looks like a refining issue. And the reason is partly that some refining capacity was, it stranded inside the Persian Gulf behind the Strait of Hormuz, but a lot of it is that the Ukrainians are blowing up a lot of Russia's oil infrastructure. And oil has gone from a, gasoline exporter to a gasoline importer.

The important point for all that is that the economic impact of oil prices doesn't depend on what a barrel of crude costs because nobody burns crude. It depends on what the stuff that's made from that barrel costs. And so for practical purposes, we're living right now in a world economy in which the price of crude might as well be $140, not $100 a barrel. And that means that the economic impact. If we want to know what, you know, we had one. month of quiescent inflation because prices came down, next month is going to be ugly.

And that's because this price is really big. And part of the reason crude is cheap is cheap, only $100 a barrel. But the reason it was it's not even more with so much of the world's oil supply offline now is that, well, yeah, but people are not going to bid high prices for crude if they can't refine it. And so this is kind of where the, in many ways where the action is. And of course, this is, you know, I don't think it's 1979 or 1973 ugly, but it's pretty ugly. So, I mean, the consequence of this is that the supply is actually tighter than maybe people imagine.

And that's right. Because we have, and you talk about this in your piece, there are a couple other things going on. One of which is that China's demand, because they've electrified so much, has been much lower, right, than people expect them. Yeah. Yeah. There are a couple of things that happen. China somehow or other stopped buying five million barrels a day.

I always find the scale of these things. The scale of everything out there is immense. But, yeah, five million barrels a day, less from China. And we don't know quite how. We don't know whether they're drawing down inventories, whether they've electrified even faster. but in any case that was a burden off the world market and then well a lot of oil turns out that the sores have a pipeline that bypasses the Strait of Hormuz and takes it over to the red sea which did help alleviate the strain except the houtis are now firing its ships in the red sea right so all of a sudden that's kind of gone and and the world's the whole we lived a lot during this whole period until the the phony sees fire the world lived there a lot off stocks of oil. It was just drawing down inventories, and the inventories are now very low,

so we can't keep doing that. So you can certainly spin out a story where this is, it gets much uglier than it was. I mean, people were worried about inflation and all of that before now, and, you know, as always, I open to open up my various news sites and this morning, and I see that The Wall Street Journal says that Trump is in revenge mode and that we're rushing ships and troops to the Middle East. And, you know, I guess to use the technical term, holy shit. I mean, a land, are we going to try and invade? You know, this is absolutely bonkers. And that just makes me, you know, it's really incredible that we're at this point.

This is maybe putting the cart before the horse. But if we ever get a stable situation, not if, eventually we will get a stable situation. Maybe it'll be in a week. Maybe it'll be in four years. But if we get a stable situation, like, would the United States under Donald Trump restock our strategic reserve of petroleum? Because doing that would put upward pressure on gas prices, which they don't want to do, right? So, I mean, once you've drawn these things down, it's not free. do have to restock them at some point. And when you do that, you increase demand, right?

Yeah. I mean, but if that's, you know, if basically the shooting stops and the shipping lanes are open, then you can do that gradually, you know, just a million barrels a day or something, just a small amount. Again, the quantities always amazed me. But here, but a, and so I don't think that's a huge concern. The question of whether, you know, that would be kind of preparing for the future and not something that this administration does, but presumably some point they will. And it's also true. I mean, I'm probably going too far afield here is that one long run positive, effective

of this is that the world is kind of weaning itself off oil in general and Persian Gulf oil in particular. Except America. Except America. That's right. No, you know, it's sort of in the corner of the headlines is that, that the Trump administration is eliminating all energy efficiency, not only energy efficiency standards, but even information. So consumers can't find out.

And even the little things, they're deleting all federal mention of bicycles and bike lanes because that's DEI. So, you know, yeah, we're heading back to the 19th century, but the rest of the world is really moving on from this stuff. And so the next time that we have an idiotic war in the Middle East, it will probably be less serious than this one was in terms of the global energy impact. I mean, the next idiotic war could be in 60 days for all we know. I think we're in the middle of it. I don't know.

We're in the second one. Is this two wars or one that we're in right now? But anyway, whatever is. Yeah. So this is why they took the soldiers' names off of the casualty list the other day. I don't know if you saw that because they insist. Well, that was the first conflict, and then there was a ceasefire. And so that's, you know, these deaths aren't part of that conflict.

All right. So I want to talk about two parts of tariffs. When Trump did Liberation Day, those tariffs were done under the ages of a 1977 law. AEPA is what everybody just refers to it by that. It stands for International Emergency Economic Powers Act. After a great many months, the Supreme Court struck down these tariffs of being unconstitutional. Trump then did two things. First, he publicly threatened firms for trying to get rebates and said that he would remember any companies that asked to get their money back as they were entitled to following court ruling.

The second thing he did was say that he was going to impose substantially similar tariffs using Section 122 of the 1974 Trade Act. However, that had a ticking clock on it. You could only do that for X number of days. I forget what it was. But the answer is the expiration date is today. Yeah. And Trump has been making noise about maybe they would try again using another section of the Trade Act of 74, 301. I guess I have a couple questions for you.

The first of which is what is Trump going to do with this? Is he going to continue pushing on this tariff thing? Well, it's already done it. They were all announced going into effect this morning. Oh, great. I missed that. Yeah. No, and I think 60 countries are now facing a new set of tariffs, again, under something that is clearly illegal. And then, you know, given the Supreme Court may or may not be ruled illegal, but probably will be in the end. This time there's a clause in there, which is that we do get to impose tariffs on countries that use forced labor or on a dubious interpretation who don't.

do enough to stop the use of forced labor by other countries. And so that even the Trumpies are not going to say that the European Union uses a lot of slave labor. But they've imposed another, I think, 12.5 percent tariff on a lot of European countries on the grounds that they're not doing enough to stop use of slave labor, which is there's a kind of almost smearing, yeah, what are you going to do about it to all everything they do. You know, nobody believes that that's the actual reason for any of these tariffs. In fact, they themselves have made it clear that this is all just, you know, we, our first legal bait and switch didn't work. And so now there's another one. But it'll take, again, it'll take months and months to grind through the process. So here we

have another set of tariffs. And they're, yeah, I mean, this, in some ways that even the level of the terrorists matters less than the fact that everybody in the world now knows that do business with the United States and you never know when they're going to pull out the rug from under you. You know, there are no rules except the latest tantrum from the guy in the White House. So there we are. There's something particularly disgusting about having the guy who told Xi Jinping that he could do whatever he needed to do with the Uekers that was fine to then say, well, you know, I really care about. forced labor in human rights.

So I guess my question here is, so in the legal world, they have talked a lot over the last couple of years about the end of regular order. And regular order is for people, Matt, I see that. I'll get to it a minute. Regular order is the presumption by the courts that if the government says something, you can take the government's word for it. You don't need the government to recreate the wheel every single time it comes before the magistrate. And so if the government says to the judge, we've complied with that.

The judge doesn't say, great, now show me all the proofs that you've complied with it. You can just take government's word for it. There's something like the breakdown of regular order, even with this trade stuff, where the administration, as you say, is sneering, you know, it isn't like, well, we'll find a way that we think we can sneak it in, they know it's not going to withstand scrutiny. And they don't care because they know that it'll take months to get it tossed and that they'll figure out another one, another bogus reason to do it afterwards. They just run the clock out indefinitely.

Yeah, and it's a special thing of even more than other aspects of how we run the government trade policy for what historically, what looked like good reasons, there's a lot of discretion granted to the executive branch. The idea was that if there's a sudden rush of imports that's threatening disruption or national security, whatever, that you need to be able to respond fast and you don't want to have to go to Congress and spend 18 months log rolling to get the deals.

And so you have these procedures, all of these numbered clauses, which are actually, by the way, they're sections from different trade acts. So you can ask about it. But anyway, but there's a 301, a 232, and a 201, and a 122. But all of these things are designed, but they're all based upon the presumption that the president has the national interest at heart and is sort of standing above the petty political considerations and is able to take quick action under some ground rules. Now you have a situation where I wouldn't say that there's zero information value in the White House making an assertion,

because if they say something clearly, then it's probably a lie. It's sort of negative information value, but there's no presumption at all that they're acting in good faith on any of this. And it means that this, more than almost anything else, it turns out, I think tariff setting is an area of abuse. It's an area where the, particularly, you know, if you have a president who has a thing about tariffs anyway. But I think he's partly he has a thing about tariffs.

He's also, this is someplace where he can go and say to countries, I'm going to punish you because you won't give me Greenland or something like that. And so, yeah, it's a complete collapse. The whole, you know, we had a process. This goes back way back. I mean, FDR created the Reciprocal Trade Agreements Act in 1934. And so we had 90 years of this pretty, pretty. a surprisingly effective process of international trade negotiations, but with the kind of pressure release valve, that if something is really happening to trade and there's an urgent political

demand that you do something that the White House can do something in short order, but all of that based upon, as you say, a regular order based upon the belief that the White House would not just sneeringly. I just keep up, you know, would not just raise a, based off on on a patently dishonest and ridiculous premise, like the European Union is softer than we are on slave labor. And so, wow, it's amazing. So the other tariff news from this week is Canada. We have new tariffs aimed at Canada.

And so you wrote, this is such a great bet, that they are, whatever the real motivation for these new, tariffs is, they are almost certainly illegal. Yeah. That seems to be kind of important. Yeah. I mean, the alleged, I can't even remember now what the alleged justification for the latest Canadian tariffs

are. I mean, they've been throwing out all kinds of stuff for Canada. My God. I mean, it's, you know, the Canadians aren't all nice, but the as individuals, but if there was ever a nicer neighbor ally than Canada, I don't know what it is.

And so we had, it was about drugs or no, and now it, you know, as far as we can tell, the latest thing is really about Trump thinks that it's Canada's fault, that there are forest fires. Wildfires, yeah. Wildfires. And, you know, the Canadians should be raking their forests all 2 million square miles of forest, by the way, Canada. Most of it, you know, close to the Arctic Circle and completely unreachable. But that's everything is, and I think maybe underlying all that is he doesn't like the Canadians because they, you know, the world likes them and the world doesn't like him. And the Spanish team shook hands with Mark Carney and tried to pretend he wasn't there.

So, you know, this is, I just, you know, just boggle. How did we descend so quickly into being this simile? simultaneously menacing and ludicrous country. Yeah, that's a bigger question than we can tackle today. Matt, can you give us the Trump tweet? I want to read this for people. Canada disinvited the United States of America to the opening of the Gordy Howe Bridge,

which is fine, considering they are paying substantial tariffs to the United States. But the original deal on the bridge, which was terribly negotiated by a previous administration, no longer stands. We changed the terms of the deal, so that the United States of America now gets 50, 50% of the profit. Thank you for your attention to this matter, President Donald J. Trump.

I mean, I don't even know what to say, except that I can't believe that this is the world we live in. Yeah, just to say, in terms of the disruptions, the Gordy Howe Bridge is at Detroit. And, you know, we are economic and natural partners to the Canadians to such an extent that the standard. that the standard metropolitan statistics called Detroit Windsor, a single metropolitan area. You know, the Canadian part of that city is, you know, across the border, but that's ridiculous. But now we have, and we have, you know, this bridge completed,

has been sitting idle for a long time, partly because Trump has this thing now about Canada, and partly because a friend of Trump owns the competitor bridge that was already open. And so, again, and what does this do? Aside from the immediate disruption, you're an auto company and you're trying to plan your production for North America because there is no U.S. or there hasn't been a U.S. auto industry or Canadian industry. There's a North American industry. You know, the parts in your car may have crossed the border seven or eight times before it finally becomes a, and this is creating, again, presumption of regular order. I mean, I mean, I don't know if there's a legal term for presumption of sanity, just plain sanity. But this is, you know, the robber barons of stop people demanding money as they went up and down the rind. Here we have Robert Barons who don't even bother asking for the money. They just stop you randomly.

And it's crazy. All right. So I want to talk a little bit about the bond market, which is a pet subject of money. mind, but is not really well understood by people. And I'm just going to let you cook on this. But I want to set this up for people with what I think of as the simplest way of understanding the bond market is the bond market is like an instrument that measures risk. And so when markets feel like the world is riskier, money flows into the bond market, which bids up the yield on bonds. And so as the interest yield goes up on bonds, that's in general telling you the world thinks that the market thinks the world is a little riskier.

Maybe that's good. Maybe that's bad definition you can tell me. What we have noticed is that I'm reading from Bloomberg here, the U.S. 30-year bond yield is held above 5% for the longest stretch since the dawn of the financial crisis. Yeah. Which seems important. So I turn the floor over to you. Okay, not quite how I put it. I mean, the bond market, what does, what do interest rates do?

One thing they do is they match up savings with investment, right? There's, when interest rates are higher, there's going to be less investment spending and a little bit more saving when they're low, it's the reverse. And so that the interest rate there has to kind of match up the savings and investment. And the other thing that it does is they're the very short-term interest rate, literally. actually, the overnight interest rate is what the Federal Reserve controls. And so something like the 10-year bond rate is, roughly speaking, the average of what people expect the Fed to set the Fed funds rate over the next 10 years.

It's also the interest rate that kind of matches savings and investment over that period. And you ask, well, which of them is it? And that's about seven incomprehensible pages in the textbook to explain why both of them are true. But what's happening now is, first of all, we think that, you know, given all these inflation shocks between we're back to bombing Iran and the fact that all these tariffs are hitting, the Fed is now, you know, just a few months ago was all Trump demanding that the Fed cut rates. In fact, they're going to raise rates because of the inflation risks. And then there's the other thing when this has, I think, less to do. Actually, I think there's a third. This is turning into a Monty Python skit.

But I mean, amongst the reasons, there is a lot of demand for capital because of this AI boom. So out there are businesses, you know, all of these companies that were sort of breaking in huge amounts of cash are now spending all of that and borrowing to build data centers. So that's driving up interest rates. And then on top of that, there's always some, to some extent, fears about future inflation. You know, if you're going to, especially if you're talking about 30-year bonds, right, you're very much concerned about what inflation might be 5, 10, 15 years down the pike. And when you have a U.S. government that is getting increasingly crazy, irresponsible, is making all, you know, the, if you're worried about budget deficits, the fact that we're

apparently about to increase the defense budget by $600 billion a year with no clear end in sight, all of that is pushing up the yields. And so, yeah, we're starting to look a little bit like a developing country, where interest rates end up largely reflecting concerns about fiscal irresponsibility. Now, you know, we probably, realistically,

I think the markets is undervaluing the extent to which we've lost our minds, but it's starting to catch on. So this is,

which brings us to something you and I were talking about the green room before the show. So things are not great in the world.

Yeah. But they're not cataclysmic. And given, like, the last two years, I would have expected it

to be worse, frankly. And so I said to you, what do you think is going on? And you referenced the, I figured about the law. It's Dornbush's law. My old teacher, Rudy Dornbush. It was famously said that it was actually thinking about Mexico at a certain point, but it applies generally. The crisis takes longer to happen than you can possibly imagine. But then when it does happen, it comes faster than you can possibly imagine. And the United States, we have 250 years of, you know, a reasonably responsible government. We have, on things like the trade,

you know, we had a remarkably benign, successful management of international tariffs for 90 years. And so we have a lot of momentum, a lot of, maybe it's inertia, rather the momentum behind people's thinking, well, this is America. You know, we won't in the end do the craziest stuff. And it takes a while for that to erode. And so there's a tremendous amount of, like, you know,

presumption of good order for economic policy. And it takes a while before people start to realize, oh, you know, the past was another country. I would never short America, but only because you can't, you know, you can't stay solvent long enough for the market to stay and rational about America. So, I don't know, where are you on that? I mean, are you in net net? Are you bullish or bearish on America writ large in that way? I mean, there's levels and levels. I mean, it's a, you know, it was, I think Adam Smith, after those damn Americans declared independence,

reassured his friends, there's a great deal of ruin in a nation. I mean, this is still, America's immense country. 330 million people, 30 trillion dollar GDP, even all of this damage is quite reparable, given where we are. But the real question, we certainly have the resources to come. back from all of this. And I think we actually have enough decency in the general population to come back from it. But how much is this insanity the new normal? How much what does it take to come back? And of course, mostly the world is not a zero-sum game, but to the extent that there is geopolitical rivalry, if you had to place your bet on America versus China right now, why on earth

would you put it on America? Given how we're behaving. And the Chinese have their own problems, but they sure see a whole lot more rational than we do at this point. Yeah, amen to that. We're going to have some hot oligarch talk in just a minute. And you guys who are listening, stick around for it because it's going to be worth your time. First message from a sponsor. This message is brought to by soul. Now, if you're anything like me, your day and night routines are not always routine,

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right now soul's offering our audience 30% off your entire order go to getsol.com and use the code bulwark takes that's get sold.com promo code bulwark takes for 30% off there we go Oh, I'm not a gummies guy myself, but, you know, for all who indulge, go ahead. So you now have two installments out in what will eventually be how many parts series on oligarchs in America? We don't know, but I'm working on the next one as we speak. So I should have a Sunday primer on wealth and wealth taxes and all of that. And actually, my own conversation with Gabriel Zuckman will be post. tomorrow morning. So there we go. Fantastic. All right. So I want to start with some things you have

in one of your last pieces. So a few hundred billionaires you write, around 0.0002% of the adult population in the U.S. have combined wealth equivalent to 20% of our GDP. And they also account for about 20% of total campaign contributions. This, I'm just going to read to this from people. people from your piece because this blew my hair back. In 2016, the top 100 donors split their spending almost equally between Republicans and Democrats, with nine of the top 20 strongly pro-democratic. This was unusual and surely reflected the fact that a significant number of Republican donors were appalled by Donald Trump. But by 2024, when Trump was again the GOP standard bearer, most of these qualms and scruples had disappeared. The top 100 donors spent more.

than three times as much on Republicans as they did on Democrats, and only five of the top 20 supported Democrats. This after Trump's authoritarianism and corruption had become plainly evident. That can't be, can't be emphasized enough. This is after COVID-19 and his handling of COVID-19 in which a million Americans died, and after his attempted coup. Right. So I guess the two things I want to talk about today are to the extent why is it that public sentiment is turning against billionaires now? And I think this is a pretty straightforward question. And then after that, we're going to talk a little bit about wealth taxes and taxing billionaires, which is subject of your second installment. So why now? So I mean, there's, so there's an underlying fact, which is that

the concentration of wealth at the extreme top is way up. And it's funny, the people still talk about the 1%. But the 1%, you know, as God knows, those are privileged people. But the villains in this story are not the, well, they use the old movie Wall Street, they have 400,000 a year working Wall Street stiff. the real villains here are mega billionaires who are who are virtually non-existent.

Like 1% is still 3 million people in America. That's right. 3.3 million people. We're talking about like the top, what, 10,000? Oh no, we're talking about like the top 300. Yeah, top 300. I mean, it's, roughly speaking, the 400 is kind of who we have in mind. And that's a they were just to carry zero weight in the economy and in our politics even in the 1980s.

And now that's the time thing, the calculation was that 300 billionaires were 20% of campaign finance in the 2024 election. And more than that in terms of actual weight because it was more targeted. And also there's a lot of other stuff that they do, like by Twitter, by CBS, by the Washington Post. So this tiny group of megabillionaires is huge, but public recognition of that lagged behind the reality. And I think it was first that Trump's second inauguration with all of the tech bros lined up to pay fealty. And then Elon Musk, not only being really out there, but actually going in, devastating the U.S. government, killing several hundred thousand children. I think this focused people's attention. And you can really, as I say, this Andrew Hall, political scientist, has an interesting metric, which is he looks for the mention of the word billionaires in fundraising emails, which was basically didn't happen at all until

basically after the inauguration last year. And now, hey, the democratic establishment has caught on that people are upset. And so I think we just kind of reached critical mass and we had some highly visible examples. And it's, yeah, it really is the extent to which a few hundred guys are, and mostly as guys, to which a few hundred men have taken a huge chunk of the nation's wealth

and an even huger chunk of political influence is really something. So what do we do about it? Around here, like, people are always complaining to me. They're like, yeah, J.B, all you do is diagnose problems. You never tell us how to fix it. I'm like, look, if I knew how to fix it, I would tell you, I'm not holding out on you because I'm trying to be coy or something. Yeah.

So you can try to do things. We should undo Citizens United. So we certainly, and various kind of ethics reforms that would limit the role of money in politics, which matters. And you can really see that when the Roberts Court said, basically everybody can give as much as they feel like, that opened the floodgates.

And the corruption of our politics really accelerated at that point. But it's also true that with, you know, immense money will find a way. If you're going to have this, you know, Woodrow Wilson, who had his problems, was a genuine progressive and also a horrible racist. But so, Woodrow Wilson said in 1913, if there are men big enough to own the U.S. government, they will own the U.S. government.

And at some level, that that was true then. And it's true now. If there's going to be that much wealth, well, you know, we actually, we actually cured that. She asked why, you know, by the end of World War II, you did not have these malignant billionaires or, you know, inflation-adjusted billionaires dominating U.S. politics. And the reason was mainly progressive taxation gradually undid the extreme concentration of wealth at the top. And that's, the details are. take need, need working out and the politics, you know, how do you get there is hard,

but we do know how to do this. Basically, we know from history that you can de-olegarchize yourself or whatever the word is. You can demusk yourself by having effective taxation of wealth. And it can be done in the past we never actually taxed wealth, but we taxed corporate profits, we taxed inheritances, probably, If you want to check in on my substack tomorrow, you can hear me talk to Gabriel Zuckman about this, but probably the best route forward here is, in fact, some kind of wealth tax. And there's a referendum in California on a very limited one-time wealth tax,

but it's, which the billionaire sees the thin end of the wage, and so do the supporters. But that's how you do it. We basically cannot have so much of our wealth. concentrated at the very top. And still be anything resembling a democracy. Yeah, that's so well said. And one of the ways that I've started to think about this, and I encourage other people to think about it,

is not in terms of fairness. Because the point isn't really fairness. It's almost like antitrust for democracy, right? You have to break up concentrations of wealth for exactly the reason Wilson put it. Once somebody has a trillion dollars, they have the power to act like a non-state actor. It's like you have a state within a state. In the same way that the United States government cannot tolerate somebody else within the United States starting their own competing form of currency, can't abide having trillionaires either.

And so that's that's the real reason to do this and you know why should they mind if Elon I don't know if you saw this Elon Musk sat down with the economist yesterday and he said that by 2036 money won't matter anymore nobody I'm like wow well then he won't mind getting tax will he well he I think he means not not not money but he means literally currency won't matter and wealth or power I think he certainly he doesn't doesn't imagine for himself that it stopped mattering. But no, I mean, there is this funny thing, which is that how much difference does even $10 billion make to the quality of life of somebody in that?

But you're right, the fairness does not matter. We can ask, you, did, has Elon Musk actually provided a contribution to society that is worth a trillion dollars? Well, the answer is clearly no, but, you know, even if you had. Don't want anybody who has a trillion dollars. You know, there are some people further down the list. You know, they, yeah, I find Amazon extremely useful. That doesn't mean that Jeff Bezos should have that much money. And so, you know, it's basically, can we still be who we're supposed to be as a society?

Can we still be a republic, not even a democracy, but a republic, when you have that much money in the hands of a few men? And the answer is clearly no. We've always known that. I mean, it's only through doing huge intellectual somersaults that anybody can, can persuade themselves for a few minutes that ain't so, but it clearly is true. It also strikes me that actual antitrust actions by the government should be part of this, too. I mean, like Amazon Web Services should be broken off of Amazon, right? It just creates an enormous market distortion.

And one of the impact of that market distortion is creating this sort of, categorically different level of wealth for Jeff Bezos. That's right. If it's what's interesting, you know, at this point, I guess it's always been true, but at this point is really clear. If you look at, look at the, you know, run down the list of top 10 of the richest men in America, almost every one of them are identified with a monopoly. Right.

It's, right? You know, it's Oracle. It's, it's Facebook. It's, it's Amazon. And the question is, did they come by those monopolies, legitimately doesn't matter. The fact the matter is that we should not be, just that we should not be allowing that much concentration of wealth,

we should not be allowing that much domination of the economy by a handful of imperial individuals who run them. I think I'm younger, you're younger than me, but I remember, you know, when we were the, it was faceless corporations and the organization man, and that's not what we have now, what we now have is these gaudy merchant princes, and it's horrifying.

You know, just on our exit here, last question for you. One of my hobby horses, and this actually long predates Elon Musk becoming, you know, a racist, terrible person. But one of my hobby horses is that SpaceX should be nationalized. And the reason being that it was insanity for the United States government to privatize control of the top of a gravity well. in that this is like privatizing orbital launch and allowing that to become a monopoly for a private company would be like allowing the manufacturer

of nuclear bombs to be privatized. It's an insane thing that the government did. It was a mistake, and the obvious answer out of this is you have to nationalize SpaceX. Well, yeah, certainly, the actual money-making part of SpaceX is Starlink. And it's crazy that a crucial global communication system

should be in the hands of a private individual. It's just, and yeah, and to some extent, you know, there is a small issue there, which was that NASA was, that never seemed to be successful at getting down the cost of space launch, and maybe some competition was good, but still, they, we would not,

we would not allow, well, we would not allow the entire phone network to be in the hands of, of a single individual. We wouldn't allow, you know, and so sure. And what's funny is I think actually in the end, what will happen is that on Starlink, the rest of the world is not going to allow a white supremacist American

to control global communications. So there will be competition for Starlink, but it's not going to be coming from the U.S. government when it should be. Yeah. All right. That's excellent. Trump just tweeted another rant about the European.

Union and I've just let people go do that homework on their own you and I don't do it for them Paul thank you so much for joining me it is always a pleasure to visit with you I'll be back with Catherine next week please don't forget to go read her piece go read Catherine Rampel's receipts today about the census monkeying it's very important stuff everybody else I will see you again later good luck America good luck to all of us