Using the Iran Conflict to Reindustrialize the US | Samo Burja

Welcome to Live Players, where political scientists and strategists Sam Obura and I discuss the key individuals with the power to alter our current society.

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power landscape. Let's dive in.

Sam, I want to talk about energy. People

are talking a lot about energy in the context of AI and and sort of in different bottlenecks there. uh but I sort of want to just talk more broadly about the sort of importance of energy independence in the US and then also

sort of the state of the current situation and the different dynamics there. What why don't you sort of uh o

there. What why don't you sort of uh o open on on this topic?

Well, of course, energy concerns are top of everyone's mind with the recent war in Iran that is still ongoing as of the recording of this episode.

Unfortunately, I expect it's going to be ongoing for weeks more to come. Even if

there is a ceasefire, the illusion of security in the Gulf monarchies and the export of oil and natural gas from the Persian Gulf has been shattered. Until

now, you could imagine essentially there being a global economy still powered by the hydrocarbon reserves of the broader Middle East, but the geopolitical

instability of the area and frankly the US inability to impose stability or offer stability uh taking those

together, I think the world should be searching for alternatives very quickly.

And this of course includes the United States. The United States has had a

States. The United States has had a fracking boom in many years. But it is mistaken to think that the US having access to some oil for domestic consumption, being an exporter of

natural gas, that that's actually true energy independence. Because at the end

energy independence. Because at the end of the day, if there is a global recession, there is an American recession as well. We should be actively

thinking to do two things. increase

radically uh the supply of energy in the United States and the other one replacing every single use of oil that we can and frankly at the end of the day

we should also be looking at expanding production but that goes without saying and I think that third point it almost takes care of itself uh no one's going

to propose banning fracking if oil is at $150 or $200 per barrel can you give kind like a brief history of um h how we got here or sort of the

major events so that people can understand sort of the the state of play a bit better.

Well uh we are uh now in a situation where the US and Iranian decapitation strike in Iran uh was not so much a decapitation. Um perhaps it actually

decapitation. Um perhaps it actually multiplied the issue. The Iranian regime had a backup called uh you know the

mosaic defense strategy. So decapitation

turned out to be as ineffective as it would against a hydra. In the place of one head, you had 31 commanders all giving commands uh following

presscripted attack strategies. Among

those attack strategies was not just US military bases, not just targets in Iran. It was also oil infrastructure uh

Iran. It was also oil infrastructure uh among the Persian Gulf uh oil producers uh most notably again Saudi Arabia, UAE,

Qatar, Kuwait and at this point the straight of Hormus has been closed not just through not through mining or through boat attacks but just straightforward application of drones.

At this point, an oil tanker only crosses and leaves the street of Hormuz, leaving the Persian Gulf if allowed by Iranian forces, in which case maybe

they're trading their oil in Chinese currency rather than US currency. Uh

something that's again a troubling development uh because for the longest time now we've had the petro dollar where all oil was traded in dollars. um

actually to some extent stabilizing global demand for dollars. Uh the US could produce as many of those dollars as it wanted and in fact routinely did in recent years uh with the trillion

dollar stimulus bills, the trillion dollar infrastructure bill with no infrastructure, etc. Now, I'm not saying that perhaps the straits won't reopen, but what is

now baked in is an energy shock.

countries like Australia, uh Taiwan, um even some European countries have only a few weeks of strategic oil reserves.

Note these are close US allies. It

matters pretty directly for say the production of uh chips in in Taiwan. The

energy price in Taiwan matters for that.

uh so this will affect the US economy even if for example we were to ban the export of oil from the US in order to stabilize you know gas prices at the

pump uh but we're basically not going to uh do that if we did that would be an even greater oil shock so for now oil will be exported from the US Americans

will just pay higher prices at the gas pump if oil exports were restricted there would just be a substitution where they would bid up things like Russian oil even higher. An important

point here is that of course the Ukrainian government correctly understand understands this war to be a windfall for the uh Russian oil revenues. So they have proactively now

revenues. So they have proactively now attacked Russian oil infrastructure.

It's possible that the supply, the Russian supply of the commodity, even with us temporarily removing or reducing sanctions on buying Russian oil, it's

completely possible that total Russian oil production will also go down at the time when this is already bottlenecked and any sort of uh proposals like the possibility of invading Kar Island that

has been floated by some uh observers of the administration. Car Island is a

the administration. Car Island is a island in the Persian Gulf owned by the Iranian government.

uh where most of their oil infrastructure resides. I mean maybe

infrastructure resides. I mean maybe this will hurt Iranian oil revenues but again just reduces global oil production. Normally when uh refineries

production. Normally when uh refineries are hit by drones which mind you happened a few years ago already. So

this was quite predictable. Uh you might remember a few years ago middle eastern refineries were already being hit by uh terrorists right with drone weapons. So,

we know it was possible to destroy an oil refinery. So, when we're talking

oil refinery. So, when we're talking about oil infrastructure, we're not just talking about free navigation of oil uh out of the Persian Gulf. We're talking

about oil refineries allow us to combine uh very heavy oil with light oil.

Basically, make it ready for use in the global market. Uh oil, you know, from

global market. Uh oil, you know, from Venezuela is not the same as oil from America is not the same as oil from Saudi Arabia. These are they have

Saudi Arabia. These are they have different chemical properties and you have to mix them at the right uh ratios.

You have to refine them uh refine them.

It is different points uh price points of refining and extracting the oil uh make sense right there are some oils that are viable and cheaper. There are

certain things that only are really profitable if oil is very expensive. So

uh there's a lot of complexity in global oil infrastructure, but oil fundamentally is the one globalized good. So truly no matter how you think

good. So truly no matter how you think about it, coal is local. It's regional.

You basically dig up a rock, you burn it. A gas is continental. You can ship

it. A gas is continental. You can ship it in an uh gas pipeline fairly efficiently. If you have to liquefy it

efficiently. If you have to liquefy it and put it in a gas tanker, you already are paying a much higher price. Oil,

however, it's like this wonderful burnable liquid. You mine it. It's

burnable liquid. You mine it. It's

physically easy to move onto a ship.

It's easy to ship cheaply in an oil tanker anywhere in the world. You refine

it, you have your fuel, which again is liquid fuel. Again, easy to load and

liquid fuel. Again, easy to load and unload from a tanker, easy to store at room temperature as long as you take precautions so the thing doesn't explode. And uh because of that despite

explode. And uh because of that despite the geopolitical complications, oil is a commodity. It's a truly globalized good.

commodity. It's a truly globalized good.

Even when you have extreme measures like say um banning the sale of Russian oil, we all know this has been partially substituted. Say if India buys Russian

substituted. Say if India buys Russian oil, uh India will buy less Middle Eastern oil. So, you know, maybe

Eastern oil. So, you know, maybe Westerners won't buy Russian oil, uh, but instead they'll buy more, uh, oil in in, uh, you know, from Saudi Arabia or

or even oil from Venezuela and other places. So, really, it's sort of like

places. So, really, it's sort of like you can play a game of musical chairs.

You can certainly reduce revenue of oil producing countries. It can make it

producing countries. It can make it difficult for them to sell, but they'll do various things like, I don't know, Russia's well-known ghost fleet, right, where they sail ships under the flags of

other countries. There's, of course, a

other countries. There's, of course, a deeper history here, which is that, you know, since the end of World War II, uh, there's been a long history of the US developing the oil resources of the

Middle East. In fact, Britain did as

Middle East. In fact, Britain did as well. And, uh, you know, honestly, this

well. And, uh, you know, honestly, this is where this whole problem started. The

overthrow of the sha in Iran uh in the 1970s sort of coincided with this uh first era of an awareness of how fragile

and dependent the world had become on exports from the Persian Gulf. We

already had an energy crisis. We already

had an oil shock. I think we're now set in for a second oil shock. Um so I think it's globalization of oil as in price of

oil dictates the rate of global economic growth therefore affects the rate of just growth economic growth for any country like China or the United States

that is at all tied to the global market. I think that was baked in by the

market. I think that was baked in by the physics of oil. So uh really you know to get off oil would mean a true energy deglobalization. But I think that's

deglobalization. But I think that's precisely what American energy independence would mean. It would mean not just American energy self-sufficiency, which is very

important. It would mean using US

important. It would mean using US strategic oil exports to uh favorably subsidize allies of the US and it would

mean encouraging our allies to get off oil. Now, when I say get off oil, I

oil. Now, when I say get off oil, I don't mean a green energy project at all. It might actually involve burning

all. It might actually involve burning way more coal or uh burning way more natural gas or encouraging countries to frack their reserves. Uh any means that

can be used uh to essentially cap the price of oil or reduce the price of oil should be employed. And honestly this should be a key US strategic doctrine. I

think the key US strategic doctrine should be for the next 10 or 20 years to push the world towards an oilfree or a less oil dependent world. That's the

only way you're going to reduce the dependency of the global economy on the Middle East.

Can you give your explanation of how you make sense of this word to begin with or or sort of how do you situate it within uh you know the or you know etc.

I mean, we we can of course u talk about the war itself a little bit. Um, you

know, I'll be honest, I don't think any observer knows exactly what's happening inside the Trump administration. Uh, it

does seem to have been a decision by the administration. And, you know, there are

administration. And, you know, there are people who talk about uh, well, maybe the strikes on US nuclear infrastructure that were carried out in January, maybe those were less effective than

previously believed. uh there's a you

previously believed. uh there's a you know sort of the Marco Rubio line that Israel was going to go ahead with this attack and that US assets were going to be endangered uh if the US did not join

in on the attack so that you know Israel would do it would do this attack either way. Um there are claims that there was

way. Um there are claims that there was a genuine belief uh by the administration provided either uh due to US intelligence or maybe intelligence

provided by Israel that the Iranian regime and government would fall. Now to

be clear, if the Iranian government did fall, it would still be destabilizing, but they probably would not close the straits and the oil production of the

Gulf Cooperative Council uh would have been uninterrupted. So it would have

been uninterrupted. So it would have actually been not a quick easy war but there would have probably been some kind of Iranian civil war between

uh regime the regime remnants and uh whatever uh government was there. Uh but

its consequences would have been muted.

That's not what happened though. Uh and

I think that that's almost the most we can say. Uh there's now talk of bringing

can say. Uh there's now talk of bringing about 10,000 US troops into the Middle East. Needless to say, 10,000 troops is

East. Needless to say, 10,000 troops is not enough to invade Iran. Uh probably

would take something like 500,000 US troops. Unclear if the US can manage

troops. Unclear if the US can manage such logistics quickly. Uh especially

since there is some evidence that US military bases have already endured significant damage from uh Iranian missiles and Iranian drones. So really,

I don't know. I I have a hard time seeing see seeing the Iranian government falling. I have a hard time seeing the

falling. I have a hard time seeing the US committing to a full ground invasion.

And because of that, I you know just think we're going to be stuck in this for a few weeks or months. Again, even

if there's a ceasefire, no fundamental contradiction has been solved. Uh you

know, Israel's security position has not improved. Israel is driving the war. The

improved. Israel is driving the war. The

US has not managed to prevent or destroy the accumulation of enriched nuclear material. Uh you know the Iranian the

material. Uh you know the Iranian the attack the uh massacre of Iranian civilians if this is in fact about protecting Iranian protesters well

that's clearly not been avenged or contraindicated.

uh and even any further developments or repairs in the oil infrastructure of the rich Gulf monarchies that has to come now with a fundamental awareness that

they're vulnerable. It turned out

they're vulnerable. It turned out anti-air defenses were not good enough to prevent missiles from hitting them and they were not good enough to intercept drones. So, uh previously the

intercept drones. So, uh previously the belief might have been that this infrastructure could be protected just with US air supremacy. So these

countries they have to start thinking about a new approach to security. And

again we could go even deeper into the Middle East and uh its history and how structurally our civilization became so dependent on uh oil exports there or

perhaps onto the roots of the conflict between Israel and Iran or perhaps in the roots of the conflict between Iran uh and its current government uh and the

United States. maybe about the Islamic

United States. maybe about the Islamic revolution. Uh but I think we can save

revolution. Uh but I think we can save that for future episodes and maybe like you know loop back to this question of a energy independence or actually a robust

world where these regimes are disempowered because we got off oil.

That sounds like a good uh good plan.

Maybe you can start by how do you expect things to play out um in the region as it might affect sort of how um you know our energy situation? Well, I think uh

prices are going to go up. That's baked

in. Uh in so far as the markets have not recognized this, I think the markets are just uh not being rational. Uh I think a surprising amount of uh they're

surprisingly difficult for markets to capture information that the average investor doesn't know or doesn't believe. Uh in theory, smart money

believe. Uh in theory, smart money should be able to move this. Uh but I think that there's a lot of incentive to just not start a recession, not start a depression. There obviously political

depression. There obviously political implications here. I mean uh by this

implications here. I mean uh by this point we all notice that the Trump administration times its strikes and its measures and its uh statements of a

possible ceasefire with the markets closing and opening in medieval Europe.

You know, perhaps people would uh stop fighting for Sunday to go to mass. I

think today we uh perhaps do our fighting on the weekend where the markets are closed and like right before the markets open you put out a statement saying actually this war is already over. We're like making good progress

over. We're like making good progress negotiation. You wait a few days the

negotiation. You wait a few days the markets close. You do some more bombing.

markets close. You do some more bombing.

I think it's kind of funny. Um but uh you know it really shows though that um I think Iran has explicitly and correctly stated that uh the US

president's weakness is actually markets.

Like not just this president, any US president pays close attention to markets. And I don't think any other US

markets. And I don't think any other US adversary has ever intentionally tried to just spike oil prices. Iran isn't

even trying to make a lot of money selling its oil. It's not that worried about paying its soldiers. Uh, in fact, most of its economy is in the hands of

the Shia clerics. So, if the Shia clerics really need to, something like 30% of their economy uh can be used to temporarily pay the Iranian

Revolutionary Guard uh CP, which is IRGC, which is the uh only organization that matters. So, Ripley, they're going

that matters. So, Ripley, they're going to keep fighting even if Iran totally loses its oil revenue for at least a while. Uh, and yeah, they're going to

while. Uh, and yeah, they're going to try to increase oil prices. I think

they're targeting $200 per barrel, maybe $300.

And, uh, again, we're already baked into an energy shock. Their countries like, you know, I'm from Slovenia. Slovenia's

already started rationing uh gas at the pump. uh you again US allies as I

pump. uh you again US allies as I mentioned Taiwan and Australia uh you know there are places in Australia medium-sized towns they've just run out

of diesel already and uh you know oil prices have already affected gas prices at pump airline ticket prices are going

up uh if tomorrow a ceasefire is reached and oil production is restored oil will still be more expensive than it was before the war

situation where I imagine this not being the case is uh if uh the US basically loses the war and the US just is like hey let's return to the situation before

the war but we're going to remove sanctions in Iran you can now trade your oil like a normal country now maybe the maybe maybe the president can sell this

as a win but strategically that would be a US defeat even if there's cheap oil because it would mean that okay instead of toppling a government we've actually

like removed this decadel long sanctions package. It's going to be a government

package. It's going to be a government with more revenue and it'll be a government that'll be able to industrialize. I mean, I think Iran

industrialize. I mean, I think Iran makes something like a million cars a year. Like they make their own cars,

year. Like they make their own cars, right? if opened global markets, Iran

right? if opened global markets, Iran would start industrializing and oof any security concerns Israel might have or Gulf Arab countries might have, which

mind you do not have good relations with Iran and have not for decades. Uh all of that would just be made way worse uh in the long run. So actually it's it's a

bit of a pickle. I don't think this is a good situation at all for either the US or its regional allies.

And so what what can be done about or how does uh h how could the situation play out in a way that um sort of you know leads to better outcomes? What is

what what needs to be done here?

Well um I think I think militarily the US military needs to adapt very quickly.

I'm just going to say it. I I you know this might be very unpopular but you know I think we need to uh prepare for a

multi-month war. I think we need to lean

multi-month war. I think we need to lean on Ukrainian expertise very heavily and we need to very quickly redirect as much

of the Department of Wars budget as we can into effective and cheap drone and anti- drone measures and actually deploy if we have any special weapon systems

that are anti- drone that are supposed to work, we should deploy those. We

should actually make the straight safer ships with new technology and uh you know but that's such a tall ask like reforming the Pentagon in wartime. You

would have to get in a real technocrat.

Uh it took Putin years of a dragged out war in Ukraine before he appointed someone with the math degree to run the Russian Department of Defense, right? Or

the Ministry of Defense. Um I don't I don't know. I I don't think there's

don't know. I I don't think there's political capital for that. So to win the war, I think would mean to basically have a military that is fit

for the 21st century. That's a pretty tall order. I think it could be done

tall order. I think it could be done with Ukraine's help possibly. Uh but

Ukraine is already using all of its capacities to go after Russia to sort of nullify it. So maybe there's a deal with

nullify it. So maybe there's a deal with Ukraine of some kind. Hey, build these drones very quickly. deploy them in the Gulf. Uh don't go after Russian oil

Gulf. Uh don't go after Russian oil infrastructure. We will reduce Russian

infrastructure. We will reduce Russian revenue by reopening the Gulf. So maybe

there's some sort of deal there. Uh I

honestly think ironically even Israel underinvested in drones. It of course had to invest in missile defense. Uh but

even the missile defense has hit its limits because you know they're not being hit by drones really. They're

being hit by missiles. Uh but I do think that drones are the most difficult question because even if you you know destroy all the missiles uh the drone is very easy to make and enough of them can

sink a ship. It's that simple. So as

long as you know even if the missiles are exhausted destroyed uh the drones can keep interdicting ships but the ships are interdicted the oil price is

high oil price is high then the cost of the US economy is high. Um, I I think like a full invasion of Iran would be a

very costly undertaking. I think it's possible we could win, but this is not friendly coastline.

This is a mountainous country. Now, it

was possible to invade Iran and it was invaded by the Soviets and the British during World War II.

uh it was I think technically uh a neutral country but it was access friendly enough that you they were worried about its oil even then and uh you know the country could not fully

resist and was jointly occupied by the Soviets and the British and they set up their own interest zones there. Um I

don't think there's any proxy force that could invade. Uh just today I was

could invade. Uh just today I was reading reports that you know sort of the initial Kurdish attack of the few Kurdish rebel groups was already

rebuffed. And again like how could the

rebuffed. And again like how could the Kurds of Iraq or the Kurds of Iran defeat the Iranian military if Saddam Hussein's Iraq you know fielding the

Kurds could not do it. There was the Iraq Iran war lasted for nine years. I

do think a full US invasion would succeed.

Uh but again, half a million US troops.

I I I think that requires a draft.

Like I I'm not sure we can like that would mean pulling everything out of Asia and out of Europe and uh it would still mean high casualties because the

drone problem isn't solved. So again, I could see a way for us to innovate out of this over the next year or two. I

think that would be a live player move to win the war. I see a way for us to take the L, lose this war, and try to fight the next war, right? Which still

involves a technical innovation. Or I

could see us fighting this big war. Um,

but you know, then we're stuck for another 10 years in Iran.

like in some way we're going to have to keep military bases on at least the Iranian coast and stabilize whatever government is there and fight whatever

Shia extremist insurgency ends up h existing in the country. Again, the IRGC it's like it's like the SS or uh it's

like a very radicalized firmly ideologically committed military force. uh they are going to keep on

force. uh they are going to keep on fighting, right? They're going to keep

fighting, right? They're going to keep on fighting even if we capture Tahan.

There won't be an easy surrender there and there'll be an insurgency. And yes,

there is support for a a secular or at least not an Islamist government in Iran for real. The urban population genuinely

for real. The urban population genuinely wants change. But to back that up,

wants change. But to back that up, again, that's going to take 10 years of our involvement there. uh you can kiss any prospect of balancing China in Asia

goodbye in that situation. It would take all of the US's strength to do that. It

could do it. But uh in those 10 years, I think China could zoom ahead. We

actually did a episode on how close China actually is to its own form of energy independence and how actually China did the smart thing. They

intentionally destroyed demand for oil.

how they subsidized uh electric vehicle production.

Why is this smart? It's smart because it means that your population does not feel global oil shocks. Now, your companies still do. They're still tied to the

still do. They're still tied to the world's economy, but commuting to work isn't unaffordable if you're just charging your electric car rather than if you're paying uh more and more at the

pump. $5 at the pump versus maybe one

pump. $5 at the pump versus maybe one extra dollar on the electric bill uh you pay for charging your car. You know, I think that sort of resilience of the

living standards and the logistics of the general population, I think was very smart of China to do that. And I think it's kind of crazy that you know the green agenda is almost designed to make

you more vulnerable to world energy shocks because you carry out the full green energy agenda. You are doing electrification but you're also doing

this intermittent power that requires peaker plants that um really you know uh makes your grid more vulnerable to

things like global gas prices.

uh already Europe, you know, is taking a second hit. A lot of the liqufied

second hit. A lot of the liqufied natural gas they were buying to substitute Russian gas, they now can't buy that because that was sailing through again the Persian Gulf was sailing through the Red Sea. It was

sailing through a straight of Hormos. I

mean, it's uh it's the case that green energy is not energy resilience.

However, the fossil fuel people have ignored that electric cars are energy resilience and are energy independence.

And frankly, maybe there's an opportunity there. Um maybe we can learn

opportunity there. Um maybe we can learn from this crisis just how important it is for the US to not be at the mercy of

what happens with these petra states, right? like this invasion. Uh you know,

right? like this invasion. Uh you know, if there was a real invasion or this air intervention would have actually been much much easier for us to endure

politically had we been uh doing what was necessary to develop a domestic energy uh energy system that is uh not

dependent on these shocks at all.

talk about the um the hot take that you have which is that this might be you know not a short-term thing but actually you know a more term thing. What is the

different view that you have than the the the mainstream on this and why are you confident in your view?

Well, um, you know, I gave a more pessimistic take than I think is mainstream right now. But, um, again, even if a ceasefire is signed, I think two weeks from now or 3 weeks from now or a month from now, um, I suspect it'll

be the mainstream view. It'll be the view that we're in an energy crisis. In

fact, um, this is currently still denied. Markets have slowly started to

denied. Markets have slowly started to reflect this. Um,

reflect this. Um, you know, I I think leadership like like committing to it until victory and doing what's needed for victory. I

think that's not such a bad strategy. I

know a lot of um a lot of people like in my uh you know in the extended commentary on x.com and among policy people a lot of them just wish to leave

and pretend this didn't happen. and uh

you know if we leave and pretend this didn't happen we might be in it this we might be restarting this war again in 6 months or a year with an emboldened Iran.

So I think we have to commit to a deep reform of the military very quickly and a deep reform of the US economy very quickly and a change in our global

energy policy very quickly. So if I have a view that's bullish, it's always the view that I always bet on live players.

What could be done so the US wins this?

I'm just taking it as a given that the US is not going to become friends with Iran. I'm not debating that. If that was

Iran. I'm not debating that. If that was going to happen, it could have already happened. I I'm not even interested why

happened. I I'm not even interested why we can't be friends. I'm just manifestly that's where the premise starts, right?

They they are ideologically committed.

That's true. They do have an irrational hostility. They do have a hostility to

hostility. They do have a hostility to Israel that Israel can't really change even if they did everything right. They

have a hostility to the US, that the US can't really easily make amends with or easily make a deal with. This has been going for 50 years at this point. Uh I

think it's literally from um it's hard for them to move away from that policy because you know the Islamic revolution started as very anti-American and

started as very anti-Israel and they just kind of got stuck on that path and then the conflict has only re-entrenched that from the current Iranian government over and over again. And the Iranian

government is rational to not even trust the US. the US killed a lot of their

the US. the US killed a lot of their leadership that was negotiating.

Like that's okay. Bridges are burned.

I'm just going to say bridges are burned. So the optimistic take, the good

burned. So the optimistic take, the good take.

Um again, we try to quickly develop the technology needed to fight in the age of drone warfare. This might make our

drone warfare. This might make our legacy defense contractors and our Pentagon generals very sad, very unhappy. That's okay. fire them. Fire

unhappy. That's okay. fire them. Fire

them and uh work with whoever can actually deliver the goods. We're now a startup military. It's day one. We do

startup military. It's day one. We do

not need aircraft carriers. I'm not sure I even believe the story aircraft carrier uh was damaged because of a fire in the laundry room. Like I'm not sure I

believe that. Governments of course do

believe that. Governments of course do lie and with good reason during war. I'm

just going to go forward and assuming that they can sink our ships. I see no reason they could not sink our ships.

Okay, it's day one. We're a naval power and it turns out our ships are obsolete.

What do we do both to win this war and win the next war and win the war after?

Because again, even if we have a ceasefire right now, there will be another war with Iran. That's kind of baked in at this point.

Uh I think startups could handle this. I

think US startups have a healthy enough ecosystem, but the reward needs to be you need to ship put your drone on a container ship or put your piece of

technology into the military's hands as soon as possible. Have low-level

officers immediately report on its effectiveness and immediately order more of whatever is being produced. So

instead of a slow process where we're replanning our military, I think we should accept we have no idea what the next generation of warfare is. Actually,

the general's big brain ideas clearly are not working. The admiral's big ideas, big brain ideas are not working.

We have to be as humble as the Ukrainians were at the start of the war and actually as humble as the Russians were once the Ukrainians helpfully killed all of their generals.

you know, the Russians actually have been adapting to this style of warfare.

So, uh, you know, that's actually great for the US defense sector. That's

actually great for, uh, US re-industrialization.

It might not be good for the legacy companies, but it will be very, very good for whoever in the US is ready and was betting on, you know, the new generation of American weapons being

necessary. Maybe that's uh maybe that's

necessary. Maybe that's uh maybe that's Andrewil, maybe that's Talenteer, maybe that's completely new uh companies because again electronic counter

measures could be a good idea. You know,

frankly, uh hacking at scale might be a very useful thing. AI powered hacking might be an excellent countermeasure to uh piloted drones potentially, right?

They have onboard electronics that are offtheshelf that are commercial. I don't

know this, but I'm pretty sure a trillion dollars of the Pentagon's budget if freed up if we cut these cancel these like, you know, broken

ecosystem uh uh legacy architectures. I think a lot could be done in a few months and a whole lot more could be done in a few

years. But moving aside from the need to

years. But moving aside from the need to completely revamp the US military which again is that's a full presidential terms worth of work frankly with the

cooperation of Congress. So that's

already you know it could be done especially if it's so important for us to to win these wars it could be done.

So maybe let's just say this is what needs to be done and uh if not you're abetting Iran. Actually that's pretty

abetting Iran. Actually that's pretty powerful. You can maybe do that.

powerful. You can maybe do that.

The other side is energy. Uh I think it should be patriotic for Americans to drive. Uh basically the patriotic thing

drive. Uh basically the patriotic thing to do now is to buy a US-made electric car.

We are going our enemies are targeting the price of oil at the pump.

We can give some money to people, but what we really want is people to have and own the infrastructure of resilience.

actually remove any barrier we can to producing more electric cars. Make it

clear it's a national security issue right now to build these cars. Let's set

a target to rapidly reduce the number of internal combustion vehicles on the road as fast as we can. Maybe the technology is, you know, it's good enough. Teslas

are good cars. Maybe the Chinese cars are better, but we're not going to buy Chinese cars. We have no reason to help

Chinese cars. We have no reason to help them economically. They're a long-term

them economically. They're a long-term uh bet. So a wartime industrialization

uh bet. So a wartime industrialization includes uh transformation of the civilian infrastructure so that everyday Americans do not have to pay the price

that our enemies would like to impose on us. Right? Then number three, uh turns

us. Right? Then number three, uh turns out it's not just important for us to build nuclear to win AI. It turns out

it's important we build nuclear to win at war with Iran. So it is a national security crisis. It is an energy crisis.

security crisis. It is an energy crisis.

You declare it a national security issue and you go out of your way to overrule every single local uh every single local

local barrier to building new power plants. I would literally have a task

plants. I would literally have a task group and I would daily name and shame Iranian collaborators. And I would also

Iranian collaborators. And I would also just make it clear, maybe make it clear to our allies, hey, we are fighting a war domestically to build the energy

infrastructure so we can keep on hopefully winning this war rather than, you know, having to retreat from the Middle East with our with our tail uh between our legs. So that's sort of my

optimistic one. It's sort of like, okay,

optimistic one. It's sort of like, okay, people were speculating that maybe America will reform its institutions, re-industrialize, build nuclear, build

drones, fighting China. Okay, we're

fighting Iran. Is that not good enough?

If it takes half a million troops to inv look, we're fighting Iran. If we were so dead set on fighting China to re-industrialize America, this is easy mode, right? We should be able to do it.

mode, right? We should be able to do it.

So uh I think pressing go on that would actually do great things and then America would be more powerful after the war. Not because it won the war but

war. Not because it won the war but because it would have systematically made all the changes necessary to be capable of winning a war against a true

pure adversary like China. Iran is not a pure adversary, but it is a country of 90 over 90 million people with uh a lot

of manufacturing and production low tech stuff, but stuff that's not outdated.

Right? Those Shahid drones are low tech, but they are contemporary weapons systems. A US aircraft carrier might be high-tech, but is an obsolete weapons

platform. So really, you know, high-tech

platform. So really, you know, high-tech and obsolete actually benefits no one.

You know, that's like a battleship during World War II, right? It's the

last generation's high tech weapon.

And again, if you prepare yourself so that you can win this war, you um have as much nuclear built as possible. You

actually build as much clean coal as you can, or not clean, it doesn't matter.

We're winning a war. you uh speed through the uh electric vehicle transition and in this process you've built a lot of new American infrastructure, you built a lot of

manufacturing facilities. You're

manufacturing facilities. You're building drones, electric cars, nuclear power plants. That in itself is an

power plants. That in itself is an accomplished American re-industrialization, right? And sure, it's going to cost a

right? And sure, it's going to cost a few trillion dollars, but compared to trillions of dollars in stimulus that never achieved this goal. We have

printed so many trillions of dollars papering over the pretend uh the pretense that we didn't stab the economy and shut it down during CO and the

pretense that uh you know, we've not um done only disastrous policy ever since.

Can't we print$ five trillion dollars and just build things with it and uh just do so directly with a clear sight for the efficiency of winning a particular war? I think actually this

particular war? I think actually this war, here's a fun one, maybe the only way to discipline US Congress and bully them into action is to fight Iran. So a

live player like Donald Trump might actually reach the conclusion actually Congress seems to not care about anything else, but they do seem to care about fighting Iran. Well, Congress, if you want us to win against Iran, you

have to empower me to do these things.

You have to empower my administration to do these things. Build nuclear, build drones, build electric vehicles. And for

a final one, this is something I would recommend to people looking at development of technology.

We should be trying to develop all chemical processes possible to make it

as easy as possible to both use coal as a plastic feed stock and even use coal liquefaction to turn coal into fuel.

It's not 1942 or 44 anymore. Whatever

Germany did during World War II, we can do much better. There's been 70 years of technological progress since. Uh when

their fuel supplies ran out, they were able to, you know, coal use coal processed to synthesize fuel. We could

do that today as well. And uh in fact in China they've already started like I said substituting uh certain kinds of plastics to now be made out of coal when you process coal into the right

material.

This will destroy and reduce oil demand.

And it doesn't matter if it's not competitive at $100 per barrel. If we

can get just synthetic coal prices to be competitive at 250 or $200 per barrel, that is eliminated so much leverage from

America's enemies. Be it Russia or Iran

America's enemies. Be it Russia or Iran or maybe one day Venezuela again if Venezuela, you know, turns out to to be less pacified than was assumed. So uh

yeah those are the sectors I would focus on high energy buildout so that we can continue the data centers because Eric let's be real currently data centers are

powered by natural gas. If global energy prices spike this means that open AAI and Anthropic and Google are competing for their natural gas with Europe and

Japan. And while again maybe that's an

Japan. And while again maybe that's an okay competition. Let's again be real.

okay competition. Let's again be real.

Europe and Japan can afford quite a bit.

They can throw quite a bit of money to buy natural gas from the United States and ship it over and uh that just means that the expenses of building more data centers go up. That's why we need to now

actually go nuclear. That's why we need to do as much solar as we can. And you

know this will reduce the sort of energy demands of uh natural gas. it will

reduce our dependency on it because again gas isn't as globalized as oil uh but because of the war it's continental scale but because of the war between

Russia and Ukraine in Europe uh and you know our allies both in Europe and in East Asia uh they've been buying a lot of liqufied natural gas from US uh

allies in the Middle East and from the United States itself so uh we should reduce our domestic demand as much as possible increase our production and then

suddenly US energy exports become a tool of US energy policy and oh of course we should uh pressure all of the allies there's a there's a saying that you know

the US president is dictator of the world uh but the mayor of America Canada I'm sorry bro you're going to

have to you're going to have to export a lot of energy or else you better build that pip pipeline or else you better

frack or else. Okay, that makes it better for America, right? We'll buy

their energy. Our allies will buy their energy. And uh you know, I think that's

energy. And uh you know, I think that's kind of a it's a very muscular policy.

It would take a very live player approach. It's still a very national

approach. It's still a very national interest or nationalistic policy. Uh but

it's very ambitious. Um the bad news is again it's very ambitious. The good news is uh you know in a way Iran is like easy mode. Like do you think China

easy mode. Like do you think China wouldn't have closed global straits with its missiles? It wouldn't have caused uh

its missiles? It wouldn't have caused uh damage to energy infrastructure even in the Middle East if they could. Uh all of these things were were priced in in a

way. So, uh, really this is, uh, I think

way. So, uh, really this is, uh, I think potentially this might be either America's, uh, beginning of this recovery, this re-industrialization, or

it might be the, uh, just a a very big humiliating defeat that, uh, pushes the US back.

Well, well articulated.

Well, I think this is stuff we're going to have to do either way is what I'm saying eventually. So, might as well do

saying eventually. So, might as well do it now.

Totally. Well,

you know, either before the ceasefire.

Yeah. and or after the ceasefire, it doesn't matter. If we do a ceasefire

doesn't matter. If we do a ceasefire right now, we should do the exact same things anyway because we'll still be weak and dependent in this way.

Yeah. Gearing towards the conclusion here, um, you know, for people listening to this who've been persuaded and of sort of the the the need to do this that

and the the the timing, uh, are there any other recommendations that we haven't gone through that you would also make? um in regarding US uh energy

make? um in regarding US uh energy independence andor anything else you want to say before we before we wrap.

Well uh you know I think we should have started building Venezuelan energy infrastructure yesterday. So you know

infrastructure yesterday. So you know maybe the Iranians can sink our ships.

It seems the Venezuelans cannot. So how

fast can we get Venezuelan oil production up and uh can a US company profit from that?

So yeah. Yeah. Um, that's a good place to good place to wrap. U Sam, this has been a awesome conversation. Uh, very

very timely. And, uh, as always, until next time.

Until next time.

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