2024 in Review: Standards and Norms with the WSJ’s Kimberley Strassel

>> Bill Whalen: It's Tuesday, December 17, 2024. And welcome back to GoodFellows, a Hoover Institution broadcast examining social, economic, political, and geopolitical concerns. I'm Bill Whalen, a Hoover Distinguished Policy Fellow. I'll be your moderator for the course in the next hour or so. Looking forward to a spirited conversation featuring the three stars of our show, the GoodFellows, as we call them.

And who are the GoodFellows? They are the eminent historian Sir Niall Ferguson, the economist John Cochrane, and former presidential national security advisor, Lieutenant General H.R. McMaster. Niall, John, and H.R. are all Hoover Senior Fellows. So, gentlemen, good to see you today. We have two segments in mind. The second half of the show, we're gonna look back at 2024, talk about a few things we learned, pick a few winners and losers, if you're willing.

But first, the A block, we're gonna talk about what's in store for 2025, specifically, what is heading Washington, DC's way. And in times where we wanna talk about what's gonna happen on the banks of the Potomac River, we need to talk to an expert on all things Washington.

We have the perfect guest today, that is Kimberley Strassel. Kim Strassel is the author of the Wall Street Journal's Potomac Watch column as well as a frequent panelist on the podcast bearing the same name. She also hosts a podcast in her own right, it's called All Things with Kim Strassel.

The latest show dropped earlier today. She picks winners and losers. Kim, I listened to it on the way over to work, thank you for not putting Hoovers in the loser column.

>> Kimberley Strassel: Thank you, Bill.

>> Bill Whalen: So, on with the show, Kim, I see a disturbing pattern in the American presidency.

If you go back to the last six presidents, going back to Bush 41, moving forward, here's the problem. One of two things happens, Kim, either their rule ends prematurely, they leave after four years, or if they're given a second term, that second term ends on a sour note.

So here we have Donald Trump, Kim, coming to Washington for a second term. He's brimming with ideas that are going to fundamentally transform Washington, the kind of ideas that meet resistance. So two questions for you, Kim, number one, how does Donald Trump, the inveterate golfer, avoid landing in the same sand trap as his predecessors?

And question two, Kim, as you're a columnist, that also makes you something of a greater of all things Washington. So what does President Elect Trump have to do, Kim, to get a passing grade from Professor Strassel?

>> Kimberley Strassel: Okay, wow, I wish I were as illustrious as you all.

I wish I deserved the professor title instead of mere columnist and talking head. Look, I strongly, strongly believe that Donald Trump, if he wants any hope of having a further three years of productivity, his first year is going to have to be slam dunk. And the way he's gonna have to do that is to follow up on the priorities that he laid out on the campaign trail.

In particular immigration and the border, energy. But also this tax reform. And that tax reform, as we all know that many of the provisions expire at the end of the year. And I know that there is a great deal of enthusiasm right now, as there always is in parties following an electoral victory.

But as we're seeing right now, as Republicans go to the mat simply to pass a government funding extension, they're clawing each other's eyes out over something that should just be as straightforward as can be. I mean, that is nothing next to the complexity of a tax reform. So that's one thing that we should remember.

Mike Johnson's gonna have a two-member majority in the House, that's not a lot of room for any error. But the second thing that worries me just briefly is I think that we're seeing a bit of a movement in the Republican Party more toward populist economic policies. Whatever you think of those, those were not necessarily the staple of Donald Trump's first term.

And I think if they're gonna go down that road, they might face the prospect of not having a replication of the economic success that he did in his first term. And I think those are the stakes of his first year. And when we get a year from now, we will see if they have passed something, and more importantly, we will see what it looks like.

A great A from Professor Strassel would be a pro-growth Republican tax package that really did help the economy.

>> Niall Ferguson: Kim, I have a question, I was in an argument with Larry Summers last week in which he said, well, in the second term, the ratio of hubris to competence is always very high.

And my response was this is not a regular second term, they just had four years to figure out what they didn't get right in the first term. This has only happened once before. Doesn't it make a big difference that this is a non-consecutive second term? And isn't it gonna be, in that sense, fundamentally different from the precedents that Bill began his question with?

>> Kimberley Strassel: I think it's two sides of a coin. On one hand, I think you're absolutely right, what those four years did was allow them to work out what they did wrong. And I think it's so important that one of the top priorities everyone's mentioning right now is this venture by Elon Musk and Vivek Ramaswamy, and DOGE.

Because one of the big lessons they took away from the first four years is that if you have an entire federal bureaucracy that is arrayed against you in your policies, you're gonna have a very hard time getting anything done. So I do hope that they continue to make that a priority.

It's gonna be really essential if they wanna get some of this sweeping agenda accomplished. On the other hand, and I think this gets to my point, is that over those four years, you also had a lot of Republicans, I think, took the wrong message from Donald Trump's victory.

And like I said, doubled down on some ideas that I don't necessarily think are great for governance or successful presidencies. And those ideas are now floating around. And our next door to Donald Trump, for instance, many of them coming from his vice presidential candidate. And you're hearing Donald Trump say a lot of things this time around from a policy perspective that he didn't say the last time around.

I don't necessarily think that those are improvements on first term. I think that they are chasing the political fortunes rather than good policy.

>> John Cochrane: I ask them to what extent you see the chance for fundamental, even more deeper fundamental changes? Trump has reportedly transformed, especially by the assassination attempt.

He's got a competent team going in. I see a chance for really fundamental changes. The Doges, if they can get through the thicket that regulation actually is. It's not as easy as just burn half of the rule book, and there's a whole lot of stuff standing in your way, but it seems very exciting.

Are they gonna take the lawfare and simply do unto others as was done unto them, or are they gonna take this as a chance to sheath that sword and put that thing away, fundamentally repair? Are they gonna extend this tax or instead do a really fundamental growth-oriented reform?

Are they going to deport a bunch of people or fix the immigration system in a durable way? They've got this wonderful opportunity. The vibe shift is, as Niall's brilliant common column put it out, for big fundamental changes and the temptation to some unforced errors like create trade wars that you don't need to do.

Do you see the chance of this happening, or is this just gonna be a little more Washington picking back and forth as usual?

>> Kimberley Strassel: Well, let's give them credit for some really big ideas, right? And I'd like to highlight two, one of them is Doge. How long has it been since we've had a serious discussion about fundamentally rethinking Washington and the way it works and the bureaucracy and the operations of the federal government?

I would guess maybe the Grace Commission. I mean, that's sometime in coming, so I think that, That's a big idea. Also, Donald Trump's vision for energy production in this country, I think, are. You cannot underestimate how important that is, because as we were beginning to see at the end of his last term, the implications not just for the US economy, but from the national security perspective.

Imagine a US that is a major swing producer in the world, not beholden in any way to other influences, able to break some of Putin's hold over Europe, for instance. Those are really big things. I'd like to hope that there's an appetite to do some even bigger ones.

I think the question is whether or not there's the time and space to do it. I mean, right there, those three things that you've talked about, and you also add immigration in there, and what a huge challenge it would be to put a durable reform, as you say, John, in.

Right there if you got some of those done, that would be more accomplished in a presidency than in a long time. We obviously have some much bigger problems that I'd like to see them addressed because we have this opening and this vibe, as Niall said. For instance, entitlement reform, social security, the trust fund is going to run out of money here soon.

But the other piece of this I'd just like to mention is you can have all the great ideas in the world that you want in the White House. And all the ambition and all the mettle to go out there and do it, and if Congress remains even half as dysfunctional as it has been in recent years, nothing will get done.

So that's the other piece. The executive branch is one branch. The legislative branch, let's just be honest, has been a disaster for a very long time.

>> H.R. McMaster: Hey, Kim, can I pick up on one aspect of John's question, which was specifically about the DOJ and the degree to which it's important to reverse what you might call the far left, you know, capture or influence in departments and agencies.

I'd like to ask you about DOJ as well as the Department of Defense, and I've written about the degree to which this radical DEI that pursues equality of outcome rather than equality of opportunity. And various elements of critical theories that judge or evaluate people by their identity category.

And these are destructive to the warrior ethos and combat effectiveness. But what I'm concerned about in DOJ and the Department of Defense in particular. They're in need of real reform and reversal of some of these initiatives and propensities, but that might the cure be worse than the disease.

Is what I'm concerned about in politicizing further those departments and agencies? And what's your sense of the degree to which there will be kind of responsible reform that can help restore what I think is a fundamental problem or confidence in our institutions?

>> Kimberley Strassel: Yeah, from your lips to Trump's ears.

I mean, I can't think of a better way to put it. And it does concern me. We've had a lot of people that have been nominated for some of these positions, and I hear the word kind of retribution out of there or elements of that as much as I do rule of law.

And all we should be hear is the words rule of law. And in a perfect world, and I keep saying this to everyone, we want a DOJ that you rarely hear from unless they are out there talking about super bad guys that they took down, the terrorists, the drug rings, etc, and so on.

When you're hearing from a DOJ that's going after political figures or a DOJ that is going after certain businesses in certain industries, because those are disfavored industries at the time, that's not a DOJ that's operating under the rule of law. It's operating under politics. And, I mean, I really, really hope I'd like to.

I've been talking to some senators who have been, for instance, doing interviews with Kash Patel and others. They say that they feel encouraged by the focus of rule of law, and also promises that to the extent that anybody needs to look into prior malfeasance at some of these agencies.

And let's be clear, misbehaving is not always the same as breaking the law, okay. And we need to make those distinctions. You can be a bad official and do bad things and not break the law. And we need to make those clarifications. But to the extent there needs to be some of that done, what they're hearing is that the Trump administration wants Congress to engage in that oversight.

I think that's a different and better approach to it than having Department of Justice go out and further politicize itself.

>> Niall Ferguson: Kim, you're a keen observer of these processes of nomination and confirmation. How are they doing? Clearly, it feels like a slicker operation than eight years ago, but I'm no Washington pro.

Give me a sense of how it looks to you.

>> Kimberley Strassel: Heck, yeah, I mean, look, I think it said something. Overall, if you look at Trump's nominees, I think it is fair this time to say that they are a bit edgier than the last crew that came through.

And yet when it comes down to it, I think most of them are on a glide path to be confirmed. In some ways, it was a kind of clever strategy. They flooded the zone with so many names. I was laughing with my boss the other day on the phone.

I was like, remember those old days when the left would just take the nominee for the cabinet that they cared about the most and then they would just unleash on them? Last time around it was Scott Pruitt at EPA. They don't even have time to think about Lee Zeldin's nomination for EPA because there's so many folks out there that they're spreading their time around on.

So, I mean, I think even the ones that kind of had a rocky entrance, Hegseth, for instance, they are rebuilding some trust. I still think the nominations that are gonna have the hardest time, and that doesn't surprise me because of the names and their histories are Tulsi, Gabbard and RFK JR. Just because if you really look at their records, they are so in conflict with some of the bedrock principles of the conservative movement. And in the end, I think some Republican senators might have difficulty wrapping their heads around that.

>> Bill Whalen: Kim, I noticed with the Hessek nomination that he did something that nominees do not do when they get into trouble.

Usually nominees historically, they hide, they just go talk to senators, they stop the radar screen. He did the opposite. He went on a media offensive. Does this suggest that maybe the rules have changed for nominations? I'm also curious, Kim, as your thoughts on how congressional Republicans feel about Trump, do they fear Trump?

For example, Joni Ernst, she kind of quickly came around and Hexith, why she's up for reelection in 2026.

>> Kimberley Strassel: Yeah, I mean, definitely electoral politics are going to play in to this. I mean, some of those Republican senators who you might expect to be a little bit more opposed to some of these nominees are going to to think twice.

I mean, Joni Ernst, there's that Tillis in North Carolina, some of these guys are up for reelection. Interestingly, Susan Collins, she lives in a state that is actually blue enough that it might even help her to vote against a couple of these nominees. So I think that's a little bit of a different scenario just for her.

I think the rules for nominees are a little different for Trump's nominees and that if the Trump team has learned anything, is that you get nowhere by turning around and letting them beat on you. They obviously love a fight and throwing back a punch. I also think it's that particular one that you mentioned is a little, maybe even a little bit more unique to Pete Hegseth, if you've ever met him.

He's a very outgoing kind of. Kinda open person and I think it's in his nature to wanna kind of get this out there and clear his name.

>> John Cochrane: Kim, can I ask you as a Washington insider, sorry, you are one, you're our favorite spy.

>> Kimberley Strassel: Thank you.

>> John Cochrane: Once you can, you can be nominated, you can become head of an agency, but if you're a little bit wacko and the, all the, I dare not use the word deep state, but you know what I mean.

If everybody in there is dead set against you, they know the rules and regulations. Can you have any effect at all or will those, they simply turn you off, wait it out four years, I've heard some stories of how they can sandbag the chief. Just don't tell you about Ethics Rule 307-B4.2 and, and next thing you know, you're in deep trouble.

>> Kimberley Strassel: Yeah I'm about to write a column that is gonna be pro tips for incoming Trump nominees. And my first pro tip is going to be chain yourself to the lawyer. Because they wait for you to do an ethics violation something and then they go to the press and they rely on the press to turn it into a, to make a mountain out of any molehill.

And they're just gonna have to be on their guard for that, one of the biggest things, and not to go too big into the weeds, but it's why the Doge effort is so important is what we have seen. I mean, obviously you look at those voting numbers for Republicans and Democrats in Washington D.C. it gives you a pretty good sense of what direction the entire bureaucracy leans.

96% for Joe Biden and a lot of those people live there and in the surrounding communities. We know that this is a left leaning bureaucracy, but what they have figured out how to do is kind of move themselves around the civil employee rules that we have, the civil service rules.

Which is supposed to guard against people who were political activists or prior political appointees from being in very senior positions in government. And there's these clever ways that they go about do that, it's called burrowing in. And those are the people everybody needs to be on the lookout for and aware of because they wield enormous power.

If you think about the average size of any one of these agencies, you're talking about tens of thousands of people. The person at the top has to delegate, and it's those people that get the jobs, the important jobs of making it done, you need to know who that layer is.

And one of the things Doge is looking at, and it was something that President Trump was doing when he was on the way out last time, and then Biden reversed it. But it's a provision that would allow you to remove or move people in those positions given by categorizing them as something else, as someone with very senior decision making ability.

It's not clear if that will withstand legal scrutiny, it was something, as I said, it was a regulation Trump was rolling out as he left. They're certainly gonna try it again, but that's gonna be key, what you just said.

>> John Cochrane: Screen, You can't just fire people and you got to get them to do what you want, and that's a talent, you have to know how these organizations work.

>> Kimberley Strassel: Yeah, you can't just say pretty please either, that's not gonna get you anywhere.

>> H.R. McMaster: Yeah one of the things I noticed as we were working on President Trump's national security strategy. Was that there were a lot of people within the departments and agencies who knew that these policies had to change 180 degrees.

The approach to China the approach to the Middle east and Iran in particular, and the more senior people were the biggest impediments. So I'm wondering if you think there's an option for like, early retirement, kinda like what Brian Chesky and other other CEOs have done to say, hey here's a package for you.

This might be the time for you to leave, and in particular I'll tell you, I never anticipated this would be the case. But the most difficult department for me to work with oftentimes, or really to collaborate with. To give the President options or to assist with the implementation of the President's very clear decisions was the Department of Defense.

So I think that I think there is certainly room to move some people on, but again, I hope the cure is not worse than the disease and politicizes these departments and agencies even further. I mean, I think the way it's done is going to be really important.

>> Kimberley Strassel: Well, I mean, you're even better to talk about this than I am because you had to live through it, so you know about that kind of resistance that you can face.

Like I said, I've just been exceptionally encouraged by some of the more granular ideas I've heard coming out of Doge, and some of them are very technical. And I mean, the ones that catch everyone's attention are when Vivek says let's just fire everybody's whose name starts with an S or who didn't, who didn't show up for work yesterday.

If you're teleworking and you don't show up, you're gone. There are some problems inherent in that, but there is like some really smart people that are really digging in right now to ways in which you can unblock that bureaucracy. And shift things around and better ensure that you have a shot at getting your agenda in place.

>> H.R. McMaster: Kim, just quickly then, I think there are a lot of efficiencies too, I mean, all these government leased buildings, who's in those buildings? Why do they need to be there? How many of them are contractors, right? So now with, with the AI related technologies, large language models, I mean, we're, I think we're overstructured in the areas of intelligence and analysts for example.

And many of them are they're from big they're big, from big beltway bandit firms. So I think there are, there are some of these techniques you can use, like who the hell is leased buildings that can maybe simplify it a bit.

>> John Cochrane: We don't want to just do bad things efficiently, we want to reorient what the government does.

>> Kimberley Strassel: That's kinda, I wrote something about that not long ago, which is you need to care, it's not about the head count, right? It's about going through government and making like the reason these people exist is because they have a lot of bad missions they've been given. So get rid of the bad missions and then they don't need to exist anymore.

The example I always gave is, I remember I had a very well meaning congressman who called me after the IRS targeting scandal. And he said, what kind of rules can we set up to make sure that the IRS employees can't do this again? And I said, I think that's a very well meaning thought process.

But if you really want to make sure that there aren't 60,000 IRS agents that all have discretion to look at people's tax returns. Come up with a flat tax, and then you have no reason for them to be there anymore. And that's your way of guarding against, so get rid of the mission and you can get rid of a lot of these people.

And I hope that's what another good idea I'm hearing, and I hope they double. They did it a little bit in the first Trump term is not only do we need to shut down or sell off some of these buildings in Washington, some of which, by the way, are only 20% used at the moment,.

That is a true figure. But if you're going to open an office, make it be out in the heartland, put it in the west coast, put it somewhere next to the people. For instance, that the Interior Department is actually regulating rather than the middle of D.C. It is actually like in the Interior maybe.

Yes, in the Interior.

>> John Cochrane: There's lots of really good people in these agencies who are hamstrung by rule after rule after rule, many of them ethics rules and disclosure rules and all this other stuff. They kinda know what they want to do, they kinda know how to do it better, but you dare not even move.

I think a great example came up last week, Boeing can't deliver for four $3 billion a rehab 747 for Trump. It's taken them 12 years, $3 billion can't do it, the same company that, Churned out 12,500 B17s in four years back in 1944, why is that? Well, among other things, everybody who works on this has to have a top security clearance.

Well, how many guys who know how to wire up a bolt into an airplane have a top security. But there's a reason for the top security clearance. It's cleaning up rules, takes a lot of time and effort.

>> Kimberley Strassel: The thing that should inspire everyone is if you want to know why Elon Musk got so excited about this idea, I don't know.

Have any of you read Walter Isaacson's biography of him?

>> Niall Ferguson: Guilty.

>> Kimberley Strassel: And there's some great anecdotes of his, like he's losing his mind during his SpaceX stuff. Why are we paying for a $12,000 hinge for this piece on the rocket when I can go buy it at Home Depot for three bucks?

And you need someone who's asking why, why do we do it this way, why must we do it this way? I think he's kind of a perfectly positioned person for that job.

>> Bill Whalen: Can we have just a couple of minutes left of the segment? So let's turn our attention to Joe Biden, last I saw, he's still the President of United States, question, the Hunter Biden pardon, what kind of pall did that put over Washington?

And how do you think Trump is gonna handle the pardon issue? He could come into office and hand out pardons to all J6 people. Is he gonna hold back on pardons, what do you think is gonna happen next?

>> Kimberley Strassel: The thing that was remarkable about that pardon, it wasn't just that it was so stinky.

Obviously he'd said he wasn't going to do it and then he did. It's his own family member, I mean the nepotism is extraordinary there. But also the sweeping nature of that thing, all infractions, anything he might have possibly done for 10 whole years. And in my mind what it is, is put aside the Hunter part of this.

This is just the latest example of Joe Biden and Democrats who lecture people all the time about the need for standards and norms, breaking all the standards and norms. Because of course water runs downhill and the minute that that pardon came out, everyone was claiming he now issue even more open ended pardons to other people that you might come after.

That is just begging, by the way, to have an enormous public debate about the presidential pardon power and people to talk about ways that you might end up restricting it. I mean we're already seeing those Articles, we don't need to be having this argument. The reason we are is because this guy, and he's done it in so many ways, Democrats have over recent years.

I'm so tired of hearing the word unprecedented in Washington. We need to have four years where nobody uses the word unprecedented in Washington.

>> H.R. McMaster: Hey, as a historian, I'm all for that. I mean, every time somebody use, I'm, well, there may be a few times this has happened in the past.

>> Niall Ferguson: What unprecedented means, when you hear somebody say that something's unprecedented, what they're in fact telling you is they know no history. And there are precedents for a lot that we've been talking about. I keep coming back to that moment in 1980 when Ronald Reagan won, in some ways a more emphatic victory, in some ways a less emphatic victory because he didn't have the House, he had exactly the same majority in the Senate.

He didn't really have the court. In some ways, Trump enters Washington in a somewhat stronger position institutionally than Ronald Reagan. He's regarded with the same disdain by the liberal elites that Ronald Reagan was regarded with. There are all kinds of foreign policy problems, some of which are gonna, I think, fall into Trump's lap just the way the Iran hostage crisis fell into his lap.

Others of which are gonna be intractable in the way that some of the problems Reagan had to grapple with were. So there are precedents for much of this, but I don't think I can think of a precedent for the Musk Trump partnership. Kim, is this not something novel and what does it mean?

Because if you ask me who's the second most important person In Washington after January 20, it's not the Secretary of State, it's not the Treasury Secretary, it's Elon Musk.

>> Kimberley Strassel: I think you're right. I mean, the idea of the most powerful political figure in the world, which Donald Trump, if he's not already, he will be as soon as he takes up office, pairing up with the wealthiest and kind of most big thinking entrepreneur in the world.

It's kind of mind blowing considering what could come out of that, I do think that's unprecedented. And my other unprecedent more things like it was unprecedented to have an FBI raid a president's house. It was unprecedented to have a special counsel bring felony convictions against an ex president.

Those are the unprecedented that I hope we don't hear any more of in Washington.

>> John Cochrane: There is a President Truman's Kulage's, Treasury Secretary Mellon was the Elon Musk of his age and they got together and cut the crap out of federal and taxes lowered taxes from 70% to 25%.

So there's always a precedent.

>> Niall Ferguson: Nicely done, nicely done, John. Nicely done, you get your historian's badge.

>> Bill Whalen: Okay, Kim, unfortunately, we have to bounce this a lot more I'd love to talk to you about, but I have a suggestion for you. In 2025, I see three gentlemen who would be excellent guests for your podcast.

>> Kimberley Strassel: My gosh, I see four in fact. It'll be wonderful, I want all of your commitments to promise to come do my podcast soon.

>> John Cochrane: Anytime.

>> Bill Whalen: Okay fellows we are on.

>> H.R. McMaster: Thanks so much.

>> Kimberley Strassel: Thank you, thank you guys.

>> Bill Whalen: On the B block Gentlemen, adios, Reva Dirche, and goodbye to 2024, let me begin with a question to the three of you.

For the second time now, Donald Trump has been named Time magazine's person of the Year. Your choice for the individual of the year, it could be somebody very obvious in the news or somebody who flew under the radar screen. So, Niall, you wanna start?

>> Niall Ferguson: Javier Milei, the president of Argentina, has done what DOGE can only talk about doing.

Because he took on pretty much the toughest assignment in the world, which is clean up government in Argentina, bring inflation under control in Argentina, stabilize public finances in Argentina. I mean, it's mission impossible, and the man has achieved extraordinary things. And he didn't even have majorities in the Argentine parliament.

 

So he's my man of the year, he's showing that libertarian policies are, in fact, doable and you can reduce the deficit and be popular. This is amazing stuff and it should inspire all of us who believe in free markets and above all, freedom. Yeah, libertad carajo, go Milei.

>> Bill Whalen: Let's turn to John Cochran, who probably is now a crossing Milei office list of who has managed to.

>> John Cochrane: I just feel robbed. The libertarian economist whose dogs are named Von Hayek and Mises and Niall stole it from. Yeah I think the obvious person of the year isn't a person at all, it's the artificial person.

AI is still growing by leaps and bounds, and we're only gonna begin to see what that leads to.

>> Bill Whalen: HR.

>> H.R. McMaster: Well, as a former National Security Advisor, I wanna do a shout out to the appointed National Security Advisor, Mike Waltz. And I think he's just a great guy, he's not been really covered very much in the media, but he served his country extremely well in the army and then was very, I think, active and a really strong voice in the House of Representatives.

A lot of people don't know the work that he did in the House on countering Chinese influence in the Western Hemisphere in particular. So he comes in with a broad range of knowledge, I think an understanding of his role. And so I wish him the best, so if one of the criteria is somebody who you want to be the person of the year and, and wanna get behind, it's Mike Waltz.

>> Bill Whalen: My choice honoring John Cochran is not an individual of an entity, and I go with the state of Israel, which, in Michael Corleone fashion, seemed to settle all scores with enemies this year.

>> John Cochrane: Yeah, I was going to one of the biggest turnarounds. I think we were forecasting bad things for him a year ago and boy, him and his state of Israel have really.

>> Bill Whalen: Okay, guys, the flip side of the coin, I don't want to call this person or individual the loser of the year, but just somebody who had a really, really wretched 2024, Sir Niall.

>> Niall Ferguson: Well, I was about to nominate the Australian break dancer at the Olympics who became the global figure of fun with the kangaroo breakdancing.

But you've prompted me, Bill, to change my pick to the Supreme Leader Khamenei. Because Iran has surely been loser of the year if Bibi Netanyahu has turned it around spectacularly. The principal loser of that turnaround is surely the Islamic Republic of Iran, which turned out to have very little air offensive capability.

Two major strikes in Israel, neither of them really landed a punch. And then it revealed itself to have very little in the way of air defenses when it came under attack from Israel. And now the regime is, is really on the ropes in a way that very few people predicted a year ago.

So I'll go with loser of the year, the Iranian Supreme Leader.

>> Bill Whalen: HR.

>> H.R. McMaster: I'll stay in the same category as Axis of Aggressors and, and I'll say Vladimir Putin, because there still is this narrative among much of the west that he's some kind of a strong man.

I see him as both a bully and a coward at the same time. People characterize him as a great strategist. I mean, look at the folly that he's engaged in, not only in Europe with the assault on Ukraine, but also in Syria where he's the big loser. President Trump used to say, hey, do you like calling terrorists losers?

He would ask me. I'm like, yeah, I like calling them losers. I think he should realize that Vladimir Putin is a loser. 600, 000 casualties in Ukraine, withdrawing and bombing their equipment on their way out as they run out of Syria. He's sitting on a pile of cash that he can't convert or use in any payment systems.

He tried to sell bonds and failed. Spending 47% of his GDP on defense and stagflation is setting in. And hey, he's a loser. And I hope that President Trump realizes that and recognizes that he's in a position of strength relative to Putin and should bolster the Ukrainians and deal with Putin from this position of strength.

>> Bill Whalen: John.

>> John Cochrane: In trouble, personifying it. This is really a remarkable moment. We've seen the vibe shift. Well, we're past peak woke and it's on the way down. It's fighting hard, but it's on the way down. Who is the person who most personifies what is about to be swept away in this wonderful tide?

I'm having trouble finding it within my own narrow discipline of economics I'll pick the, the Piketty, the Stiglitz, the lists of dozens of Nobel Prize winning economists who once a year sign joint letters saying that malaise, Argentina is going to fail. Venezuela is wonderful, Donald Trump is going to ruin the world and whatever the heck goes on.

And then a year later, they're completely wrong. The tide of history is sweeping this whole movement out. Maybe you guys can have a better personification of just what is being swept out, but that I'm still looking for the person most in charge.

>> Bill Whalen: John, this is your chance to say goodbye to Paul Cronman.

Idea. Small but. Okay, guys, something you got right in 2024 is something you got wrong. HR you want to kick off?

>> H.R. McMaster: Hey, well, it's been for years. It's been for years. I wrote about this in At War With Ourselves when I was recounting really how Putin and Erdogan tried to create this illusion that Assad was in a strong position, right?

It was inevitable that he would remain in place after the Syrian civil war. And I list all the reasons in the book for why Assad was profoundly weak. I always thought he was profoundly weak and of course he was profoundly weak. And that his weakness was exposed after Israel's decisive action that John alluded to earlier against Hezbollah and kicked the legs out from under Assad, who was reliant on Hezbollah and Iran's proxies broadly.

So, yeah, I think I was right about Assad.

>> Bill Whalen: Okay, so, Niall Ferguson, you never get anything wrong, right?

>> Niall Ferguson: Everybody gets things wrong. It's very important to keep score and recognize what you got wrong. I'll come to what I got wrong in a minute, but I did predict consistently not only that Trump would be reelected, but that he would get the nomination, which was by no means everybody's expectation 12 months ago.

So I'll go back and look with pride on my Spectator cover story on Trump's second act, which came out in the spring of 2023. What I got wrong, I thought the election would be closer than it was. And in that sense, I fell victim to poll delusion instead of just listening to the financial markets and the prediction markets, who turned out to be much more accurate than the pollsters.

>> Bill Whalen: Did you. Who was closer in their prediction, you or Ion Persieli, your wife?

>> Niall Ferguson: That's a good question. I think she was. She's got much better judgment on politics than I have. And she was more confident in the final few days when I got quite jumpy and nervous about the polls.

So, yeah, she was able to just ignore the rogue Iowa poll, whereas I was kind of gnashing my teeth about it. So she's always going to beat me on political judgment because she's actually done politics where all I do is sit in libraries and read about it.

>> Bill Whalen: Mm hmm, hey, John, we waited for you.

We read it. Saving the best for last. Give us something you got right in 2024 and something you whiffed on.

>> John Cochrane: Well, the most important thing, given limited time is what I whiffed on. And I am so glad I was wrong. I also thought, would it be a little closer election.

But I thought no matter what the election would do, that there would be chaos afterwards. And I think I went on this show and made that prediction over and over again that there would be legal battles, that there would be a repeat of battles in the streets that made 2020 look like nothing.

There would be the hashtag resistance. There would be heaven knows what on the inauguration. There would be lawfare like crazy. There would be an attempt to not certify Trump's election in the Iowa. Well, we'll see, but that's not going to happen. That the Democrats and the whole left, that the woke religion would just fold over and give up.

I think is just remarkable so that we're not having civil disorder about this is good enough news, but that everybody seems to accept Trump is the legitimate president and now we gotta run to him and get our little policy wins in. This is just remarkable good news that I was wrong about.

Thank goodness.

>> Bill Whalen: I'm with both you and Niall and John. John, with both you and Niall on this. I was also surprised by the breadth of the victory for Trump and also surprised, John, that just all the resistance has just really calmed down so far. Winning the popular vote can do magical things, I guess.

Okay, guys, channeling your inner HR McMaster, give me a reason for optimism in 2025. And HR, since this is your name, your rules, your game, you go first. Reason for optimism.

>> H.R. McMaster: Okay, I think that contrary to expectations, Donald Trump will be a tremendous source of stability in the world in the coming year.

And the reason is, when you look around to other leaders across the free world, these countries are in a period of political turbulence. And a lot of Trump's agenda, I mean, is the agenda for Europe and Japan and other parts of the free world. I mean, energy security, supply chain resilience, invigorating the industrial base, for example, countering Chinese economic aggression.

The list goes on. So, I think there's a tremendous opportunity for the Trump administration to put forward a very powerful international agenda that will be quite contrary to the expectations. And in fact, alliances could be stronger and there could be a great deal more international cooperation on these issues.

>> Bill Whalen: John, an optimistic note for 2025.

>> John Cochrane: Well, I'll again plug Niall's vibe shift essay, which I thought was just wonderful. This is a wonderful moment, there's a worldwide vibe shift. Yes, there's a libertarian president of Argentina, there's Giorgia Meloni in Italy. There is soon that man of the year next year is gonna be Pierre Polavier, who's gonna take over in Canada.

Looks like the Tories are gonna wake up in Britain and throw Labor out and maybe rediscover their inner Margaret Thatcher. The Europeans have figured out that they've regulated themselves to death, their economic policies are awful, and that they need a doge, and their immigration policies need fixing. Climate catastrophism is giving its way to pro-growth policies around the world and politicians who embody.

Yeah, there's some populism in there, there's some potential tariffs and stuff. But compared to the size of the vibe shift, and our enemies are folding before our eyes, just the threat of little Donald Trump coming in and they seem to fall apart. Look what's happened in Syria. There's opportunities, there's dangers, but it's just a wonderful inflection point and great opportunities with dangers for wonderful things to happen and kind of the nightmare of the last four to eight years or 12 years to be over.

>> Bill Whalen: John, I want you to share with the panel something we were talking about before we came on the air. And I was lamenting how many countries have political chaos right now, and you were saying that, well, a little chaos every now and then is not a bad thing.

Democracy is supposed to be chaotic.

>> John Cochrane: Yeah, I think we said there was a unified government with a unified policy in Russia in 1950s and in Germany in 1939, that wasn't so great. People debating within norms, rules, tradition, the ability to lose elections and come back another day, rule of law and stuff and stuff.

But a little bit of chaos is a wonderful thing, especially right now. There are times when, they say decades happen in a week, and then weeks happen take decades. We're in a decades happen in a weak moment with some wonderful opportunities and chaos along the way, great.

>> Niall Ferguson: Just to reassure our listeners, John wasn't quoting Lennon there because that quote is often attributed wrongly to Lennon.

It's actually correctly attributed to Friedrich Engels, so, only slightly better, John. Or it's Jefferson, a little revolutionary now and there, it's not a bad thing. But Niall, do you wanna build on what John just said and then give us your prediction for 2025? So, I worry about the vibe shift being so universally hailed that we all succumb to euphoria and perhaps even hubris.

I'm kind of racking my brains thinking, what is it that I'm missing that's gonna ruin this? Because it does feel a bit too good to be true, and history tells you to watch out for that thing that you took your eye off. What is the thing that will happen next year that will blindside us, that we will curse ourselves for not seeing?

And I throw a reason to be nervous. I mean, I look at the stock market, it's tremendously elevated on the back of, well, amongst other things, fiscal profligacy for four years. And the new administration is committed, yeah, to renewing tax cuts, but also to some kind of fiscal stabilization.

And I just keep asking myself, if you combine that with a pretty aggressive policy towards China, 60% tariffs, maybe you have a little bit more pressure on the Taiwan issue. Taiwan is where all the semiconductors come from that the AI boom depends on. So, while everybody's feeling euphoric, being a Glaswegian, I have to sit there worrying about the thing that we're missing, and the thing we could miss is that sentiment in financial markets.

John will confirm this, can change dramatically from bullish to bearish without what seems that big a vibe shift. So, I'm gonna just put up a warning, that you can have a very, very enjoyable post election vibe shift. I think the minute he's sworn in, and leaves Mar-a-Lago for the icy wastes of Washington DC entirely surrounded, as Kim said earlier, by Democrats in the bureaucracy.

I think the vibe is gonna shift again in a different direction, and some of the realities are gonna hit home that perhaps investors won't find quite so delicious when they're being enacted. So, just a little word of caution, as I brought vibe shift into the global domain, beware the vibe reverse.

>> John Cochrane: I wanna follow on just quickly. Yeah, an Uber driver was recently asking me about Bitcoin and which stocks he thought. And I remembered my history that in the 1920s people say, every waiter in busboy is asking for stock tips, and that's when I forget which financier said, that's when I knew to sell.

>> Bill Whalen: Niall, almost got you off the hook, Niall, reason for hope, reason for optimism in 2025.

>> Niall Ferguson: Well, I'm really looking forward to the great dynastic union that will bring the two houses of Trump and Musk together, cementing at least three generations of dynastic unity. So, my prediction for 2025 is that the wedding of the year will be Barron Trumps to Vivien Musk.

Only through marriage can these two great houses be united, and all the predictions that they'll fall out and the afternoon of inauguration day be laid to rest. Think Game of Thrones, people.

>> Bill Whalen: Okay, well put. Gentlemen, good segment, we're gonna close this by talking about 2024, which went from the surreal to surreal.

And what I'd like to point out to our viewers is that actually we now officially have an actual night on the show. Sir Niall Ferguson, recently invested into knighthood, receiving his honor from King Charles. Niall, I want your thoughts on, what were you thinking when this was going on?

Besides, obviously, please, I don't wanna fall off while I'm kneeling down, but just, what goes through a man's mind when he's getting this incredible honor?

>> Niall Ferguson: It's true that one worries quite a lot about tripping or bungling the quite complex choreography of an investiture. But I was thinking quite hard about all the people and institutions that I owed for that honor.

And I do feel strongly that any kind of recognition one receives, and I dare say HR feels the same way about his military honors. It's really not about you, it's about your role, really, as an intermediary between your parents, your grandparents, the institutions that taught you, and that which you have sought to serve.

And I did feel tremendous sense of pride that that had happened and my mother had lived to see it. That meant a huge amount to me, as I said to His Royal Highness. And that was my next question, what did your mother say? Well, the Scots are cautious about any expression of pride.

In fact, my mother always comments that she was bright. Brought up not to feel pride, and I think that's a kinda salutary west of Scotland sentiment. But, yeah, it meant a lot, I think, it meant a lot, and it would have meant a hell of a lot to my grandparents, too.

So, yeah, one sort of connected through the generations, Edmund Burke has this great line in the reflections of the revolution in France. When he says that the real social contract is between the generations, between the living, and the dead, and the unborn. I tell you, I've never felt that contract so binding as at Windsor Castle kneeling before the king.

The sense of one's small place in the great scheme of the generations across the centuries was humbling in a very powerful way.

>> Bill Whalen: John and HR were not doing a live show for a while, but should we do an all kilt show the next time we get together or just have Sir Niall in his kilt?

>> Niall Ferguson: Well, I recommend the kilt as an article of attire, and I think the names McMaster and Cochrane are eminently eligible for kilt wearing.

>> H.R. McMaster: We could all be wearing them right now and no one would know.

>> John Cochrane: Niall, I'll celebrate what you just said, Americans are kinda footloose, the sense that you just evoked of a connection to family and place, that goes over and institutions.

That goes over generations, over centuries and hundreds of years, we Americans largely don't have that, so congratulations for it.

>> Niall Ferguson: Thank you, John.

>> Bill Whalen: Before we sign off for 2024, a housekeeping note, the four of us on the show would like to congratulate Shauna Farley for being named the Hoover Institution's inaugural Chief Creative Officer.

Why am I mentioning this? Because it was almost five years ago that Shana had an epiphany, the way she saw it, we had three prominent Hoover scholars under house arrest thanks to Covid restrictions. So why not put the three of them on air and share their wisdom with the rest of the world, and thus was created GoodFellows.

Shana, congratulations, we treasure working with you, and I hope you don't feel like Oppenheimer having all kinds of regrets over what you've unleashed upon mankind. Gentlemen, anything you'd like to add?

>> H.R. McMaster: Hey, Shana, you're the best. Yay.

>> Niall Ferguson: Congratulations.

>> John Cochrane: It's such a pleasure working with you, creative stuff done, hang in there.

>> Bill Whalen: Let me be the first to say, hail to the chief.

>> Shana Farley: Thank you guys so much.

>> Bill Whalen: And on that note, we're going to end Goodfellows for 2024, but fear not, we'll be back in about middle of January, right about the time Donald Trump is taking office with a new show.

So we wish you and yours a very happy, very joyous holiday, on behalf of my colleagues, Sir Niall Ferguson, John Cochrane, H.R. McMaster. Our guest today, Kim Strassel, also here at the Hoover Institution, thanks again for watching. Thanks for your continued support of the show, look forward to seeing you next year, take care.

>> Shana Farley: If you enjoyed this show and are interested in watching more content featuring H.R. McMaster, watch Battlegrounds, also available at hoover.org.