The Price Tag of War: Tracking the Billions Lost in Modern Conflict

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And welcome to the Tarar Palmeri Show and the Red Letter. We have a special guest with us again. Robert Wolff, who was a former advisor to President Obama on his economic team in formal, but still very helpful during the 2008 crisis. He also advised his number of politicians now, who is former Chairman and President of CNCEO of UBS.

Robert, thanks so much for joining the show. So much to get into today.

Yeah, crazy day, crazy day. You wake up to news. You go to sleep to news and everything in between. I don't know how you guys do it, but God bless you. Yeah, that's sort of how it works. Got a role with it. You know, kind of makes us as news people a little ADHD because we're just darting around from a story to story to story. But we all woke up to Operation Project Freedom by way of truth, social from President Trump, basically announcing that he was going to have guided missile destroyers attempt to help these barges carrying fuel and petroleum.

And fertilizer to move through the straight of our moves for other countries that like Europe and Asia, that really need access to this straight. And you know, this is so altruistic and everything, but Iran announced just hours later that they'll shoot down any U.S military presence in the straight or on the land. I mean. What did you think when you saw it? Robert, I thought this is just another failed attempt to try to open up the straight. So I'm not going to say it's as bad as liberation day, you know, from April a year ago when he announced the tariffs, which felt like it was the game of thrones red wedding for execution.

“But this to me is just more noise because to me, the most important thing they said is that they're going to guide and not escort.”

And so I don't know what ships are going to want to go through the straight with minds everywhere, not escorted by the US, but just go on. It's kind of like going on their own. Hey, we'll tell you where to go. And by the way, it's not like we know where all the minds are. So to me, it feels like a failed experiment. And then obviously, you know, you just mentioned with Iran said afterwards, I would have a whole different plan, you know. I would probably if I was in the present shoes, I would try to figure out how do I get to nuclear deal 2.0, where you talk about enrichments and ballistic missiles, you know, in lieu of, you know, the sanctions.

“I actually would probably let Iran stop thinking about tolling, you know, similar to what Egypt does in the Suez Canal, I think that this just isn't believable.”

That is like a complete capitulation for Trump though to get back to the table with Iran and allow them to have a nuclear weapon, which does not have a nuclear weapon. I would say nuclear 2.0, so I would do similar to what President Obama did with China and Russia, that being said it would, you know, limit Iranian build up, but I also would add missiles and ballistic and for that I would think about the tolling.

But then you're just giving, then you're actually enriching Iran by allowing them to toll your basically allowing them to continue their uranium program because they will do it.

Well, well, we should be clear, if you looked at the nuclear deal 2.0, they weren't enriching uranium, that's not. They weren't doing that, they were actually being, being looked at by intelligence and now they've built up since since we've had no check in balance. Also, by the way, if you open the Suez Canal, if you think about what energy would do, energy would go from north of a hundred dollars a barrel down to my guess below 60. So if you're tolling a dollar a barrel, you're actually lowering everyone's price dramatically.

“Number two, I think you can, this is to me, during the idea of we're trying to do an Iran deal 2.0.”

It doesn't need to be forever. I just think it's a way to start having a real negotiation because right now it feels to me, there's no exit strategy in sight.

And to me, he could say, listen, we killed I at all, and we impacted the regime, we've deteriorated a lot of their ballistic missile capability. We've deteriorated a lot of their enrichment capacity, and so now we're going to actually look at a different deal. And if you get Russia and China on that side, like President Obama did on nuclear deal 1.0, there could be a deal to be made to me would just that this impasse that's just not working. I, that seems like a really big lift, and there is demand right now.

I can't imagine that they would come to that agreement anytime soon. And you know, I heard today that even if they did resume to normal passage through the straight of our moves, it would take six months for the supply chain to even come back to normal.

You know, listen, there's all different whether it's three months, six months, we have lost 900 million barrels of supply.

It's about 13 to 14 million per day, and we're going north of 60 days. I mean, we're not talking about this like the 2022 Ukraine Russia shock. We're talking about the shock on energy supply is more like Carter in the 70s. I mean, this is one of the most dramatic oil shocks we've ever had.

“Now, the positive is, if you want to see some light at the end of the tunnel tower, the positive is, you know, some of the largest countries, you know, in the world like China and South Korea and Japan.”

But because of what happened to them during 2022 in Ukraine and Russia, they have started to stockpile energy.

So they're good for 100 to 200 days.

And then the best case for us in the US, we're totally energy independent. We're actually supplying more energy and LNG than we ever have in the past. So so you could argue that, yes, for places like Pakistan and other places where there's rationing and blackouts, it's horrible. But there's a deal to be done. And I think we have to include our adversaries and our allies.

So China as well as the Middle East as well as the Europe. You know, I was at the French ambassador's residence for White House correspondent. And I caught up with the Irish ambassador who pointed out to me that, you know, we think we talk about some countries in Asia, we talk about Europe and how they're impacted by the straight of our moves, but we really talk about Africa. And how they may be actually months away from a famine because of this because they need access to Eurea ammonium so that they can plant.

So that they can have seeds so they can actually have crops. I mean, the down cycle of like the down cycle effects from all this are really cataclysmic when you actually think about that. Entire. Yeah. You know, once and then.

“Listen, no question. I think there's 53 countries in Africa.”

There are some that are benefiting like this because their oil, oil exporters such as Nigeria.

But for the most part, yes, their third world country and they're being greatly impacted.

I also, I'm not making comparison of U.S. first Africa. So I want your viewers to know this is not rather all making some dumbass comparison. But if you look at what's going in Wisconsin and Michigan. Diesel fuel is at an all time high, all time high, including when we were peaking in gas, including in the 70s all time high. And if you don't think that impacts truckers and farmers in the role areas, then we're kidding ourselves, which is why in my opinion, this impact does not work.

We have gas right now at 455 people think it's going to go to north of five bucks in the summer. Like these things just don't work for this president, especially as we get into the midterms. I paid more than five dollars a gallon for gas this weekend. It was pretty brutal. It's it's pretty painful to fill up a tiny mini Cooper. When you realize you're paying what would have been the price of an SUV, it's kind of crazy.

“And I think it's a reminder that like this is a huge economic.”

This is a huge political liability for President Trump. Who by the way, according to a Wapow ABC News poll that's Washington Post ABC News poll published over the weekend, he has a 62% disapproval rating. That is the highest he has ever had in both terms combined and get this 72% of poll participants disapproved of how he was handling inflation. That is a seven point increase from two months ago.

I mean, that was what everyone thought that he was stronger on the economy and immigration than Kamal Harris. Yeah, I would say unlike a lot of Democrats, I'm willing to sit down almost across from anyone. You know, I know that that's become a big thing and I have lunch with Steve van in a few years back.

The other thing he said to me is the most important poll is are we in the right or wrong direction.

So this poll that you just talked about by ABC and Wapow and Ipsos, you know, just kind of is front and center, but it doesn't surprise me because you and I have talked about the past. You know, when we have the abs and have something like the top one percent have 90 plus percent of the wealth in the country. But what's really rearing it's ugly head is saving rates. Is at the lowest three years. So if people think affordability is not front and center, they're insane.

“I know the president has made that comment and I think it's just crazy.”

It's like just gaslighting the American public because everyone is dipping into their savings. Like they've never done before. Yeah, I mean, he actually called affordability democratic bullshit. That. Yeah.

I think I mean, Tim Scott the other day, I think it was to memory about Aramos said gas prices are going down. I don't even, I mean, I don't even know how we even, I mean, that must be like front and center for the onion or SNL. I mean, it's just ridiculous, you know, of what people are saying and I think it's shameful. And, you know, gas prices have actually increased 30 cents in the past month by 30 cents. And they were already ridiculously high at the top at the start of the month.

So and, you know, as you mentioned to me before this show that the debt is higher than it's been since what was it? You had a ratio. So I like to jab my friends who all tell me their fiscal Hawks and these fiscal conservative still live.

But this is the first time since World War II that debt is higher than GDP in the US since World War II.

So yes, it made sense in World War II. It doesn't make sense today. So that just tells you a between and this is both sides. You know, I don't, I'm not here to have trumped arrangements in drum. Both sides have been spending an insane amount of money over the last few decades.

And it's crept up and we're doing nothing about it. You know, they, you have this thing called pay force. Okay, you want to increase the budget to go pay for it. They don't do that anymore. You're not going to be a dictator, are you?

I said, no, no other than day one.

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Yeah, no, it's true.

“And honestly, the Democratic Party has really done little to prove”

that they are better at handling the economy. A new U.S. economist poll shows that a generic congressional Democrat is still only marginally more popular than a congressional Republican with an overall favorability rating of negative 21. That means that we might not see this very enthusiastic blue wave.

I think more likely people just coming out to vote against President Trump rather than for a party because I haven't really heard much. I mean, I haven't really heard a lot of ideas out of the Democratic Party. I haven't even really heard a great offensive when they could be playing that game right now when the Republicans are low.

I don't see this. Yeah, so interesting. You said that because last week, I went on TV and I said publicly on Fox that I support Kevin Waters our next Fed Share. And I don't think he got any Democratic votes in that committee.

where I was down there.

And he was a part of the Fed back then.

And he had an active role working with banks. And he is a sharp guy. And he's really smart.

“And I think of all the candidates that President Trump was thinking of”

choosing he would be the best. And so the idea that none of the Democrats are voting for Kevin Waters who's experienced and smart. And by the way, his background is he somewhat hawkish. And the other thing I would tell you, viewers,

is you need a majority of the votes to raise a lower rate. So it's not like Kevin can say, you know, I know he was getting hit by people. He's going to be a Trump puppy. He's going to be a Trump puppy.

But he has one vote. And so this idea that he can magically lower lower rates just doesn't exist. And I think actually in this inflationary environment, they probably won't lower rates.

And so, you know, so I was against that before year end.

I thought we should have lower rates, but now with the war, you know, I think we're a bit of kind of at this in-pass. So you don't think it will be a more hawkish fed with course at the top of it. I think it would have been, but I think when I think right now, in my opinion, long term,

I think the job market is going to be hit our country more than inflation. Inflation was coming down at a nice pace. You know, listen, we don't really know how to judge what I'm, you know, what I would call them, you know,

I'm not really in there. Other people would call like it as well. But we kind of now are in this AI economy. GDP just came out recently at 2%. And the entire really, you know,

flex to it was capex and business spending. And it was all around AI, whether it was technology or data centers, infrastructure or cooling. And so, you know,

I think in this AI economy,

“I think it was last night Bernie Sanders”

I was reading had this symposium where he had people from China and people from the US talking about it. And if the two bookends of that speech was, it's incredibly exciting and incredibly scary and it has to be governed.

But if you talk, if you listen to it, it's clear that the impact of jobs, you know, long, are going to be scary as shit. And one thing, you know,

someone who runs a business, you know, I have employees and I know other people are saying this. So this isn't new to everyone. But I mean, for every employee,

I have, I pay a payroll tax. But if I all of a sudden buy, you know, new machinery or new computers and new equipment, I actually can write that down on the offer depreciation.

And so actually, I get a tax credit for it. So if you're thinking about productivity gains, you know, you know, using human capital versus using,

you know, what I would call capex,

“people are going to go to the capex side.”

Interesting. Okay. I do want to get back to some of the politics going on right now. You know, we've talked about the economy and like,

who's actually paying for this gamble and the straight of more moves, and it seems like it's all of us, right? But, you know, and it's,

and it has Republicans freaking out. I mean, I was talking to some members just a few weeks ago, and they were in a total state of panic about the economy. Trump is one of the biggest drivers for voters to come out in elections for Republicans.

Clearly, they aren't, not happy. And it's really independence. It's right leaning independent to our mostly unhappy with him.

And it's those margins that really decide elections. But another thing that, you know, Republicans mentioned, is that they don't think it'll be this sort of blood bath, blue wave.

You could say. That would be, because of jerrymandering and redistricting. And the maps have been so carved up already, that they're pretty much set in stone.

And we're not going to see like 20, 30 seats shifting from one party to the next. You had the voting rights act. That overturned well, not completely,

but, you know, various parts of it last week. Ron DeSantis in Florida is trying to redo the maps. To hand over a number of seats to Republicans. In Virginia, the maps were redistricted to favor Democrats.

But now the Supreme Court in that state is is holding that up for a while. So I think, you know, this might even know Americans may be feeling a lot of pain, and they may be going out to vote against President Trump. We might not see the kind of political movement that some may be expecting.

Like the whip blush. I would probably say the over under is 20 seats still.

But I think your spot on terror, right?

We don't know what Alabama is going to do, although we kind of think we know what they're going to do. Louisiana, Mississippi. So all the southern states.

“I mean, I think I saw I think the other day is like 40%”

you know, African Americans in Mississippi, and maybe they'll get one of the four seats. You know, and so we know that Jeremy Manning is going to impact the mid-terms. I would say the question is, you know, everyone's being hurt.

And this idea that, you know, Republicans are sticky voters and democratic sticky voters. I'm not so sure that's as true right now. I'm not sure, you know, look at what's happening with, you know, people like Marjorie Taylor Greene,

or Tucker Carlson, or these influences who are going the other way.

Can they impact the vote?

So, you know, I'm just not sure whether this will be, you know, kind of a wave election or not, but I would agree with you. It doesn't feel that way today. Yeah, it doesn't feel that way, but I certainly,

and six months is a long time in politics. Ever. Could you, could you see the economy turning around in the next six months?

“Um, I think it's hard to really think that”

inflation's going to come down on health care and food prices and gasoline fast enough where people won't feel the pain. You know, certainly President Trump, you know, these algorithms kind of shoot out, you know,

what I would say fake news and fake information. But I think the pocketbook, you know, kind of speaks for itself. And, you know, my opinion will have gas over four bucks, you know, by the end of the summer.

I think inflation will stay high. I probably say I'm a little more nervous of, you know, stagnation, you know, kind of rearing its head right now if this war continues. The, the one saving grace is, you know,

the amount of money being spent, you know, by these big companies on CapEx is insane. So the question is, and we'll have a, I think Friday unemployment number. The question is, how much is it impacting unemployment?

We just don't know yet. The AI, the push for AI. Yeah. It is a scary thing.

“And I think it terrifies a lot of people,”

especially younger people coming into the workforce. Because a lot of those admin jobs, kind of assistant type jobs can be taken by AI. But I think if the training those young people had to use AI,

so that they can work at a higher critical thinking level.

But, you know, it's a hard thing to do, right? I mean, I was reading the other day, you know, legal jobs are being lost because people are using it. I read today that, you know, banking, they're going to start using, you know,

clawed. So it's starting to impact a lot of what I would call middle, middle tier jobs. And, you know, just going back to politics, because I think you were spot on.

Although I'm a staunch Democrat. I think the Democratic Party has to have a better economic message. Then they have it can't be about Trump 24/7, you know. And right now, the populist movement, you know, and I would consider myself more of a centrist,

but the populist movement would Bernie and AOC. And, you know, they just have a better message right now. You know, Zoron, I would say, you know, he has to show he can execute his message.

I would say AOC and Bernie have the benefit of being, you know, federal, so they can, you know, and they can really go after Trump and his administration more on health care, the impact of AI,

whereas, you know, Zoron doesn't have the same number of tools. Yes, the balance of budget, you know, being, you know, in the city that New York, which is really tough. I don't know where you grow the revenues.

And you just can't do it with taxes. It's just not going to be approved. But I do think that the economic agenda has to be, you know, much more, much more clear for the Democrats for them to ever have a chance of this wave election.

Yeah, that's right. I mean, there's a big split in the party with the feeling of essentially Democratic Socialists and Democrats, right? And, or Democratic populist, as you might call them, and more centrist kind of built Clinton type Democrats.

But the leadership of the party, there's a lot of anger right now in leadership. And anyone who seems to be endorsed by establishment, they have this, like, stink on them. Anyone who's getting money from the D-Triple C,

or the Democratic Senatorial Committee, you know, anything from Schumer's PACs,

I mean, RNC has seven times more money

in their war tests than the DNC right now. And leadership, again, more, and he's getting grilled. I mean, people who are expecting an autopsy report, it wasn't pretty brutal shlacking in this last election.

You lose all seven swing states, and there hasn't been an autopsy report. Well, I, I'm going to, you know, I don't mean to put salt in the womb, but that autopsy report was done in paid for by donors.

So in my opinion, they should have an autopsy report. So in my opinion, they should have made it public. I heard Ken had a tough interview with John Favro recently, and John really went after him saying, you know, it's owned by the people who paid for it.

You should be showing it. But I agree with you.

“I think, you know, you've done some recent podcasts,”

you know, on the Michigan race, on what's happening in Maine. And, you know, so you've been right at the cutting edge and all of all of this. You know, it's clear, Janet Mills, you know, opted out last week.

That was a Schumer person. You know, he's leaned in. It feels like with Haley Stevens and Michigan. In my opinion, I think the one thing we learned with by the, let the primaries play out.

You know, let's have a real primary fight. We know we're going to have one, you know, this presidential election. They'll probably 20 people running. But I think we, we have a lot of approach

by thinking Schumer should dictate what happens in Maine. All right. He's personally very unpopular. And, and the voters have, have reflected that. But as a, I'm guessing that you've been a donor to the DNC before.

Correct. I'm getting a donor to the DSC, the DNC, although I'm, I've been a huge donor to the Democratic Party. But I, I don't think I've given a scent. In 2025, which is the first year probably in 20 years I haven't given.

Now I will be giving in 26, you know, to congressional races and Senate races. But I was so turned off by how we blew so much money. So much money in 2024. You know, I felt like they were not a good, you know, steward of my money.

Not that it's a lot. I just think that, you know, we didn't do well in a lot of races.

“What was it in particular that really bothered you or what kind of spends did you see?”

Well, I think one of the biggest things, and I don't blame this on Kamala.

But the idea that we spent, you know, a billion and a half plus dollars.

And we didn't really, in my opinion, have a great gauge of the younger voters. I mean, we lost a lot of our core voting base. Because we were just out of touch. And I think that, you know, when you spend that amount of money and you're not getting to your core voters. And we lost some Senate races, I think we could have won too.

Now I will tell you, on the flip side, I would have given us a 10 to 15% chance to flip the Senate. Today, we have a 40% chance to flip the Senate. It's still not 50%. But Alaska's in play, you could argue Texas is in play, you know, mains in play. I'm not saying we're going to win those, but this now, it was three in play.

Now this probably eight in play is all in the same. So I'm using the word in play. Marty, or is that because of the candidates on both sides? Because Republicans have fielded some pretty weak candidates.

“And I think it's both, I think the Democrats in a lot of ways.”

Because it's the entire establishment candidates that might be giving them a chance. Yeah, listen, I think Tala Ricoff, you know, was it seems to be a good candidate. I certainly have my disagreements with Graham Platten or whether he can beat, you know, Collins, I don't know. But Sherrod Brown has a good chance. It looks like Ossoff, or when Virginia, Roy Cooper will win North Carolina.

You know, I think Chris Papas could, you know, possibly win a new Hampshire. My only point is is Mary Pilata and Alaska. There's just a lot more possibilities before we were hoping, you know, maybe the whole three seats. Now we're questioning whether we can, you know, do more than that. So, you know, I think it's part candidates in part, you know, the, you know, Trump isn't, you know, helping his party right now.

I, I do enjoy always reading the stories in Politico and various other places like Will John Fetterman become a Republican.

Will he switch sides and I think he likes just dangling it out there. I mean, he obviously denied it, but just keeping that rumor going gives him a little bit more power. And sort of keeps him in the game in a way and gives him some more power in, in, in the, in the Congress.

I agree. They're amusing. Fetterman votes 90% with Democrats. And some of the things he just disagrees with the Democratic party and that's fine. Just like Susan Collins votes 90% with Trump. So we should not make like, you know, we really lost the center. Everyone goes to their corner on almost every tough vote.

Yeah, that's true.

“Have you heard anything about an autopsy report? Like, have you seen it? Has anyone seen it?”

Has have you heard anything about this autopsy report? Have you seen it? Has anyone seen it? Nope. I have met with Ken Martin. I speak to the DNC. I have, you know, I think what they're saying is we're not looking to go backwards. We're going to take a few of our lessons learned and we're going to look to move forward. We don't want to go backwards and debate it. You know, that's kind of what I've heard him say.

But I have not seen it. Okay. What are your other donor friends saying right now? I mean, what's the struggle? You know, I actually think they feel pretty good about the house. And I think they feel like the Senate's in play.

And I think with the presidency, I think all of us, we're probably going to give money to five people instead of one. There's going to be 15 to 20 people running. I will have at least 10 friends running. You know, and so I think you're going to want to have a real primary and kind of let it play out a little. What do you think about California right now?

It's just all thrown up in the air with the swallel scandal, which seems to be getting easier by the day. But what did, how are Democrats feeling?

“I think, listen, when you have an open primary in California and you have, I think, in the top five two Republicans right now.”

And for the most part, you have like six or eight Democrats all between five and 15 percent.

And someone told me there's like over a hundred people running. You know, I'm a little nervous, but I'm hoping that it's at least a Democrat versus Republican, then I think a Democrat or it would. But there's a possibility that there's two Republicans running. And so, you know, I think it could be a real shit show to use your French earlier on. But I'm hoping that, you know, I'm hoping that it's, you know, stir against Hilton or, you know, two dams, but certainly, you know, is a dam.

I'm not hoping that we, that there's a flip in California and it doesn't, I don't think they will be. Okay. I think actually Trump backing Hilton was a negative Hilton. Interesting. Well, only time will tell Robert.

Thank you for joining. Thanks for having me on terror. Love being on. Yeah, of course, we love having you. You are economic guru and political insider.

Thank you.

I don't know if I like the second one, but I'm going to take the first one.

Okay. Okay. Look at it. We're going to click right now. You're kind of, I mean, I've got to wash myself.

It's like feel so ugly out there. It's true. It is. I don't know, like I said, I don't know how you do it because the news is just coming out. Everyone's so fast.

It's just insane. And it's hard to actually, like, it's hard to actually process it. But that's the point, right? The dilute. I think you said to me this morning, if I love the idea, you don't really want to, I actually hate the idea.

But I love the idea that you don't want to really prepare, you know, topics because the news is already changing. And I love that you said, Robert, if we prepared yesterday, today it would have been different because of project freedom. And you're so right that we have to be at the moment.

“And I think that's what makes you special.”

Oh, thank you. I appreciate that. And I'd like to be prepared that way. Yeah, and I appreciate that you're prepared for whatever happens. So this is, it's all good.

Well, we'll make this, we'll work through the news waves as surf, surf these tsunamis as they come. Yeah.

Thank you to all of you, though, as always, hit that subscribe button if this is your first time on the page.

You know, you can obviously become a paid subscriber. That's how you support independent journalism. That's how you make how you keep these great informative shows happening. And I appreciate all of you and sending your questions in advance. And we'll do another show probably next week.

So you can start messaging me now about what you want to talk about. But I can't promise you that I won't have to talk about the craziest news the day at the top. So thanks so much. Bye. Thank you, bye.

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