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USA QUESTIONS FROM AUSTRALIA The Sydney Morning Herald and The Age The Big Short author Michael Lewis on what he thinks happens next with Trump and the USA PLAY YOUTUBE VIDEO Original article: https://www.youtube.com/watch?v=93Y9DNFHws4
The Big Short author Michael Lewis on what he thinks happens next with Trump and the USA The Sydney Morning Herald and The Age Jun 10, 2025 202K subscribers ... 136,035 views ... New York Times bestselling Author Michael Lewis is, as one interviewer recently put it, “a kind of guru of our age”. This is because, in books like Moneyball, The Big Short and Going Infinite, not to mention his own podcast, he has chronicled some of the big social and economic seachanges of our time - from the global financial crisis, to the cryptocurrency market, and how online gambling companies have managed to wage something of a “war against young men”. Sometimes, he even seems to anticipate the sea changes. Last year, he all but predicted Donald Trump and Elon Musk’s DOGE manifesto, when he decided to investigate what American civil servants actually do. And the catastrophic risks that might come from decimating the federal government. Today, Michael Lewis, on all of this, and what he thinks comes next for the American government. Plus, whether he thinks our own prime minister is “gutless” for delaying a ban on TV gambling advertising. See omnystudio.com/listener (https://omnystudio.com/listener) for privacy information. The Sydney Morning Herald and The Age Peter Burgess COMMENTARY I enjoyed this ... a very good interview. What places like Australia and Canada think about the USA at the present time may be more important than what the US press and talking heads think about the 'Trump saga'. The subject of this interview is American, and as a prolific author has the imagination to understand the crisis that the United States is facing, and that Trump is ignoring. This does not look as if it is going to end well for the USA! Peter Burgess Transcript Intro 0:00 michael I have to start by asking you what civil servants in the American federal government actually do and what is the risk if they're fired Because your latest book was actually mostly written last year before Donald Trump returned to the office It seemed to predict Elon Musk's gutting of the federal workforce So what happens if they're fired Well it depends on which ones you fire But uh but for starters if you kind of think about the federal government there's several frames that are useful but one is this just manages a portfolio of risks and risks and problems that the free markets don't want to manage or deal with And and it's all the hardest problems you know it's from everything from like how you keep nuclear weapons from exploding when they shouldn't to cleaning up to cleaning up horrible waste to like forecasting hurricanes is like you you if you move from from from sort of agency to agency in the US federal government inside each one you will find spine tingling risks being dealt with and the the way they've 1:03 gone about de you know the the supposedly addressing the waste fraud and abuse that they say existed in the government was just to cut arbitrarily whoever they could rather than subjecting them to any kind of relevant relevancy test or or competency test and so God knows what happens It's like it's like watching a you like the little fat fat kid loosening a nuclear reactor just pulling buttons and and and and pushing levers and all the rest It's like you never know It's very hard to to to predict where this leads Okay So So no US closer to another pandemic or nuclear accident 1:34 biggie But so in your estimation does that mean that the United States is perhaps closer to experiencing like another pandemic or a nuclear accident now than say before all of these Doge cuts Of course Yes All the above Name your risk I don't think there's a single risk it's less likely to to uh to to to have to deal with I mean it's um the so the mental model that Elon 2:03 Musk and his crowd had when they came into the government was I think that it's all kind of wasteful and we'll figure out which parts aren't by just firing everybody and hiring them back if we need to And um and they and so it they didn't they were they were they were making cuts to things they didn't understand Um and they were they were doing it as if it was like a tech company like Twitter Yeah That which is it's true that if like if Twitter goes down for a few hours because you fire the wrong engineers who cares Yeah This this does not matter But if like tornado forecasting goes down for a day Yeah or the Newark airport uh sort sort the the uh the uh the FAA at the Newark airport is nonfunctional the computers go down it's potentially catastrophic So um I mean I it'd be interesting to actually play this play this out as a game You 3:01 try to name a risk that I don't think is all of a sudden made worse by what they've done C certainly they've done nothing to make me feel more comfortable that our government is more competent Are civil servants better off than elected officials 3:11 Okay And so the huge contrast to this of servants that are profiled in your latest book And I want to read something from your book because you contrast uh federal civil servants to say elected government officials And you write of bureaucrats You say they were the carrots in the third grade play are elected officials the kids who bludgeon the teachers for attention and wind up cast as the play's lead You said you know they take credit for the good the good work that the civil servants do and then they blame them when things go wrong right You're talking about totally different profiles of people So I really want to ask you it's something of an existential or profound question really which is are the civil servants of the like that you profiled are they better off to lead the country than say our elected officials 4:00 Because the people you profiled they're missiondriven They're selfless You know they're the people that are keeping up the minds the ceiling the roofs of minds from collapsing over the heads of people They're the people who are finding cures you know for rare diseases Are they better suited to lead the country than our elected officials Their hearts are generally pure but you know leadership is a funny thing These are tend to be very recessive characters like like that You put them on stage and make them talk and it often makes them very uncomfortable All the seven writers of of of the of the book all the people who did these profiles found that in the very beginning anyway with all their characters it was like pulling teeth Like I don't want to talk about me I want to talk about my team Uh you know that kind of thing But but as like characters far more admirable than the if you take the average civil servant and put them next to the average elected official I think nobody would have trouble identifying who is the superior 5:01 human being Uh but but they have also have different talents Like you you it might be hard to take the average civil sergeant and try to put them in charge They might they might not be comfortable in the role right Kind of thing Uh but but the bigger point is in our country anyway um there has been allowed to grow and fester this really lazy stereotype of not of the politician but of the government of the civil servant They are either the deep deep state or they are lazy or they are inefficient or at worst they're corrupt like they're wasting or stealing taxpayer money which this stereotype is so outrageously different from what you actually find when you rattle around the department of agriculture or the department of commerce or the treasury department So that that it's unbelievable the stereotype exists Okay And the and the reason it exists is that these people's stories don't get told And they don't 6:00 get told because I'm I'm sorry to interrupt your question They don't get told they don't get told one because they are precisely the kind of people who sit in the who quietly toil in the background are interested in their work and in solving problems and they don't publicize themselves Let let's take one civil servant from your book So she's from the Food and Drug Administration Now that probably doesn't light any of our brains on fire This is Heather Stone uh and she creates a tool to help doctors find new treatments for rare deadly diseases And I think she's a case study right about the kind of people that you found or you know your co-writers found in the civil service They're missiondriven They're selfless They could have made a lot more money in the private sector right But they want to help humanity right So tell me what drove her and and and tell me really about the devastating ending to her story which kind of illustrates what happens when you get an incredible mind like hers that isn't used to its full potential in terms of being able to help humanity within the government So it's the last piece in the book by me and it's there for a reason because it sort of hints at the source of fa one of the 7:01 sources of failure in the US government but but she herself quite admirable and so so a little backstory here um when I was writing a book about the pandemic called the premonition I got to know a scientist at the University of California San Francisco which is like the preeminent medical research institution in our country Joe Daresi is his name he tells me a story The story is that someone had come into their hospital with they didn't know what but their brain was being eaten It was because something was going on in the brain Before they figured out what's wrong with the woman she was dead They cultured her brain They found that she had he found that what she had in her brain was something called balamuia brain eating amoeba U only discovered in like the mid 90s Jodesi scientist tries to figure out if there's anything that could cure balamuia He takes all known chemicals that are approved by the food and drug administration here and in Europe and finds there's actually a thing called 8:01 nitroxylene which is weirdly a UTI drug used in Europe and in China uh for all I know in Australia that if you give it to people it's it it seems to kill the the the balamuia bug without doing any damage to the patient So I say to Joe Reesi like 'Oh that's great If I get balamuia I don't know how you get balamuia but I think you get by eating dirt but uh like it's fine now You figured out the cure.' He says 'No.' He says 'The way the world works is I do this research and I can publish a paper maybe although the papers these sort of papers don't get published usually of like I found this random thing in my lab.' He said 'But there is this woman at the Food and Drug Administration Heather Stone who um who has taken it upon herself all by herself to gather up to try to gather up as many case studies as she can around the world of doctors addressing rare disease both both with success and with failure because all we 9:02 have is case studies with rare disease You can't do science with rare disease You can't build a they can't get a big enough sample You can't do randomized case studies with with a drug that you know where the disease might kill the people who don't get the drug So all we have is the stories and she's built this website this this and this app to accumulate the stories It is a brilliant idea It is exactly what the government should be doing The market won't deal with this rare disease There's no big business in rare disease because it's rare And so this cure exists Nobody knows about the cure But the government as it should is going to step in gather the stories of these cures disseminate them all doctors around the world So when you walk into your hospital with this amoeba eating your brain they can fix you Our government has lost its stomach for these great things She's doing this thing all by herself The app is Cure ID it's called is up and running She can't publicize it She can't promote it this 10:01 kind of dissent within her own operation about just how much emphasis they'd be placed on this because it's not exactly science It's telling stories Um the story I tell I mean it's a happy it's sort of a comedy or a happy story with a with it's a it's a tragedy with a happy ending A little girl in the middle of Arkansas contracts balamuia The only reason she's given the drug that saves her life is that the mom finds Heather Stone herself uh through obscure academic paper gets in touch and these FD and the woman at the FDA gets her the drug Yeah Doesn't work the way it's supposed to It's sort of like that story sort of dramatizes the disconnect between the the the ambition and the quality of the people in the government and what the government seems capable of carrying out right now It is this thing that's incredibly frustrating I promise you that if I if I dropped you just randomly into the federal government you would be 11:01 shocked by the caliber of the people and you would be shocked by how it doesn't the whole thing doesn't work very well and it's very upsetting It's sort of like these people grinding away and they're being like misused by the society and it's the society's fault like we're not managing them well And Trumps monetization 11:17 then in contrast to that really hugely would have to be you know the monetization of the presidency that we've seen with Donald Trump You know I've read that you know the president and his family have monetized the White House more than any other occupant And and I've and I've read you know one journalist in the New York Times wrote that the Trump administration is a candidate for the most brazen use of government office in American history perhaps eclipsing even Watergate Do you agree Of course it's not even close Uh I mean it's I mean I don't know I'm not a historian of the 19th century Perhaps there was some very crafty president who figured out how to turn the White House into a cash machine Uh but no one in my 12:01 lifetime has done that Richard Nixon didn't do that Uh I mean there were there were norms in place that and the country kind of been on a hair trigger alert for this kind of corruption for a long time The idea that you are like issuing your own cryptocurrency token and having dinners that people pay you a million dollars for by buying your cryptocurrency token to to to promote it It's just it's and never mind like the hotel business I I mean it's it it there's been there seem in the mind of Donald Trump there seems to be no distinction made between his interest and the country's interests and and he does seem to proceed as if the country exists to serve his private interests The end of the American empire 12:42 Okay Okay So this brings me to my next question because everything you've just mentioned coupled with of course what we're seeing on the streets of Los Angeles and him bringing in the National Guard you know over top of the California governor and so forth I mean are you do me stop you for a sec that the streets of Los Angeles are largely peaceful that there's like one tiny 13:00 little piece where and it's not that big a deal and he's trying to inflame the situation Exactly So I my question is I mean are we seeing the end of the American empire Is this the beginning of the end Not if I can help it I'm here I'm here I love your work and you have predicted some incredible things right I I know a lot of good people and I and I love my country and I think my country has is a very it's like a complicated person Uh it's capable of lots of bad stuff and lots of great stuff And I I think that we are obviously look if if Donald Trump proceeds unchecked and he like realizes whatever his vision is Uh yes The answer to your question is yes I don't think that's what's going to happen I'm more hopeful than that Why why don't you think that's going to happen Because I've got to say one of the things the people aren't with him I'm sorry People aren't with him The people aren't with him I mean it's he's got he's he's not a popular president Okay The people might Florida Governor Ronda Santis 13:53 not be with him But if you look at the people under him So I was reading I mean just in March you know Florida Governor Ronda Santis So his response as I 14:01 understand it to Donald Trump's plan to to invoke the biggest mass deportation of illegal immigrants I ever is to loosen child labor laws So he's like 'Okay all these illegal immigrants who uh who who pick the fruit and vegetables upon which our common economy based is based they'll be gone That's fine We're going to we're going to let children 14 and overdo it.' I mean is that not the beginning of of the end of an empire I mean it's not a good sign Uh I'm not I'm not celebrating this I just don't think I think it's pretty grand claim end of the empire And I also think I I think there is this huge disconnect between what's coming out of the mouths of our elected leaders and the standards of behavior and the values of the of individual Americans I think even now if you put Obama in a room with Donald Trump and and they each got to talk to every single American and then you had 15:00 an election I think Obama will win 85% of the vote I think that that there's that we we are we've kind of lost our mind at the top of the country right now It's going to snap back We but you need the problem is you need elections to do that And in the very short term Donald Trump terrifies anybody who's running for office as a Republican who holds office as a Republican So they're kind of marking marching in in lock step with him But that could break I mean these things things move fast This could change and move in another direction very fast And and what do you what do you think it might take And the reason I'm asking you this is a midterm election A midterm election So you've got hopes for the midterm elections that the Democrats will will take control of the House of Reps Look I don't think Donald Trump I don't think anybody's going to think I think I think even fewer people a year from now are going to think the country is being wellrun than they think now I think that he's created conditions for things to get even worse for lots of people not just the economy There's going to be an ill 16:01 ill feeling in the air And assuming we have a free and fair election and I assume we will that I think he's going to get shellacked I think they they might lose both houses uh that that and and once they're on the run once the bully gets punched it's amazing what happens in the schoolyard Uh so I just think someone needs to punch the bully Michael Lewis on gambling 16:22 Now Michael I've got a question for you because you just said you know not you know it's not going to be the fall of the American Empire if I can help it And I've got to I've got to say to the listeners who don't know and many of them will You have sort of predicted I think massive social changes that have happened or you've explained them You know you explained what brought about the 2008 financial crisis Yeah I don't predict anything You don't predict Well except this latest book I mean it did precede all of the Doge cuts But anyway but I want to ask you about something totally different which is about gambling because you've got your own podcast and it's all about against the rules and it's all about you know legalized sports betting companies and how they're exploiting fandom and gambling advertising has been a massive point of political contention here So 17:01 I'm wondering if you can teach us something because our government has stalled banning gambling advertisements on television and it's a proposal that had bipartisan support So can you tell me from what you know what just how bad are the risks of gambling and what would you say to our government you know when they're considering whether to ban ads TV ads about gambling full stop Like would you say you got to do this Yes But I would also say why I haven't done it already because you said you were going to do it And so what what's happened is this happens in industry after industry right espec the vice industries they get so big they have so much money and there's such a concentrated interest it's very hard uh for politicians to fight them rather than just take the money and and the and the organ there's not an organized and well financed opposition so that's hap that's happened in a nancond in this country it was sports gambling was illegal was basically illegal except in Nevada until six years seven years ago and now it's what 38 states that it's legal I think is that right I mean it's moving so fast I'd hate to even put a number at least 38 states And it so it's here's what I'd 18:03 say It's a predatory industry the way that and it's predatory in a way that even casinos are quite predatory right But it's it's it's taken it to a a completely different level because because the the the leading sports gambling companies they're actually data companies They know more about you the gambler than any casino's ever known about its customers and they're able to manipulate you into wages that you would never make you know naturally on your own And um and you got the casino on your pocket 247 Uh it's on your phone And so it's it's just it's a really toxic form of gambling Um and it's targeted at young men So it is a it's almost like a war on young men It's shocking that there've been surveys done like 60% of the young of college males are are sports gambling in the United States from basically not many almost zero 10 years ago So uh it's um and and the way the industry is structured um it 19:02 essentially minds addiction that they don't make that it's not like oh everybody's all having fun making a little wager and some win and some some lose and a few more lose than win No that's not how it works If you actually know what you're doing you get banned or limited to the point where you might as well be banned They figure out very quickly that you know what you're doing and they don't take your bets If you really don't know what you're doing and you're kind of incontinent about it you become a VIP And if you're a VIP you're in trouble because you've been identified as someone who's bad as bad at this and they're gonna and they're gonna and so there's studies that show I mean this is new in our country you all may be a bit more inoculated because it's been in your it's been in the water there longer but it that from from sort of first voyager to addiction problem hits crisis is like six seven years kind of thing And I I it's we're we're headed there I mean like there's going to be I think it's going to become actually a public health issue here and people are 20:01 going to start noticing and there's there's signs there already signs turning up that is becoming a public health issue and and people here have criticized our prime minister Anthony Albanesei for not putting in this reform you know he said he was going to do it and it's been stalled Do you think that's just sort of gutless in terms of the impact that it will have on people here Yes Yes Why let these people advertise Why encourage people to do something that's bad for them Uh I mean we we we we don't I don't know what you do in your country We don't allow cigarette advertisements here That makes a lot of sense I mean people will find it Make the the way you deal with this problem in the modern world You're not going to probably ban it or make it illegal to gamble on sports but you just make it harder You make it you you create snags You don't make it really easy to ruin your life You you and you know decent society sort of tries to protect its citizens And the problem you have is probably the problem we have is you've got some probably very powerful financial interests in the form of the gambling companies Oh absolutely That that that don't want that to happen Well the gambling companies in the sports Yeah the sports organizations And the 21:01 sports Well everybody makes money off this Michael Lewis on storytelling M I've got one last question for you and it's it's it's a left to field one but you do teach a master class on storytelling Now this is very left of field but you are of course a master storyteller and I know that a lot of people here around the world are really struggling when they speak to people this is very left of field about Gaza and Israel and say they're on say they're on opposing side of the political spectrum What are your tips for people about how they can help the other side understand what they're saying Not necessarily even to persuade them of how what they believe but just so that the conversation doesn't devolve into recriminations Do you one simple tip is actually to find a character and tell a story about them like who this per if someone on the you know humanize the other side through an individual would be one way to do it Uh I mean making is in the same way you might make a doge person read one of the stories in our book before they go and slash the 22:00 government They couldn't look they couldn't look at it in the same way If you give them a true concrete story of to an Israeli of some Palestinian or a Palestinian some Israeli that you you might you might temper views a bit I don't think actually this is it's funny you say this There's a there's a there's an economist at MIT uh who right now is working on this question of can you change people's minds Can you present them with stuff that will change their minds And there's a sort of trope out there that oh people don't change their minds they have their opinions and they just dig in and it's it's sort of true and sort of not Uh he's proving it's actually not true You can get them to temper their views You just present them with story and fact and uh and make them live with the the those uncomfortable things and uh and you you you you kind of move them in some direction Um but that is out of left field I'm sure I'll wake up tomorrow morning with a brilliant answer that I wish I had given you but I that's the best I got right as we all do and we love you for your 23:00 humanity and your storytelling So thank you so much Michael Lewis Thanks for having me See you

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