Diana Furchtgott-Roth - Economist, Professor & Author | Navigating Economic Realities

How were you effective over your career? How did you find that you could have the biggest impact and what did that look like? If I can work somewhere like the White House or a major cabinet agency, then you can make decisions that really help people. The decision makers inside they are very much subject to outside pressure. I think a lot of the great doctors leave countries where there is only public options. If they practice privately, then they cannot be in the public system. So you have some specialists who are practicing privately, but then normal people who want to see them can never do that. If we do not move it in the right direction, what's the reality for the average American? How is it going to impact them? Well, already the average American is seeing lower and slower wage growth because of inflation, but inflation running at 8.5%, and average wage is increasing by 5.6%. And that's just the average a lot of people and getting raises at all. Welcome to success story. I'm your host, Scott Clary. The success story podcast is part of the HubSpot podcast network. HubSpot is a huge supporter of the show. I'm a huge fan of HubSpot, not just because they support the show, because they support entrepreneurs. And if you are an entrepreneur, you have some problems that a lot of entrepreneurs have. Productivity and it's not a secret. It's nothing to be ashamed of. You're not the only one that has this problem and why do we have this problem? Well, all the tools and the tech that we're using, they're massively over complicated. We have tons of time consuming tasks. Our teams are not getting the information they need to close the deals, connect with customers, whatever it is. As entrepreneurs and our teams, we all have productivity problems. But HubSpot's customer platform truly helps. It was built to save time and make your job easier. You can get back to building your business. No more hours wasted on time consuming tasks. No more chasing down prospect info if you're trying to close someone. No more one system for this, another system for that. HubSpot can help you find leads, reach prospects, deliver the insights you need to convert them to customers all in one place. Plus HubSpot AI can literally do more work for you. So you can focus more on scaling your business because HubSpot knows you have massive growth goals and they're here to make your productivity problem go away. Visit HubSpot.com to learn how they can help you grow better. The first thing people hear is you. So I'll do the introduction and I'll do some post-production after. But tell me, what's your origin story? We'll talk about your background, where you came from, you have an incredible resume. But go into detail. So where did this career aspiration, the things that you've done, various universities in the government, where did this all start? How did you get excited about this? Was this a dream that you had as a little kid, or was this something that evolved over the course of your career? Right. Well, well, I've always wanted to be an economist. I've always thought that economics can help make people's lives better because you look at countries with good economic systems and people are much better off than in countries with poor economic systems. So I very naively thought that if I could help put in place a better economic system, people would be happier and better off. Little did I know that it's not the economist that put in place the good economic systems. It's the politicians and that there can be very obvious solutions to economists that politicians do not enable. So that's basically the backstory. So I set out to get degrees in economics. I have an undergraduate degree from Swarthmore College, a graduate degree from Oxford University. I came to Washington. I got a job in a consulting firm and then another consulting firm. And then someone called me from President Reagan's Council of Economic Advisors saying we've had an unexpected opening for a junior economist in the field of taxation. Could you come on board? And so I accepted and that's how I got started with a career in policy. And when you went into policy, obviously as somebody who has dreamt of being an economist from a very early age, you wanted to change things for the best. You wanted to make the U.S. one of the greatest economies in the world and you wanted to do everything to improve the lives of the average person. But when you first go into policy, you probably realize, like you mentioned, that politicians make a lot of the decisions that actually impact the work that you wanted to affect yourself. So how were you effective over your career? How did you find that you could have the biggest impact and what was what did that look like? So when you're outside the system, you think if I can work somewhere like the White House or a major cabinet agency, then you can make decisions that really help people. But then when you're inside, you're working at the Council of Economic Advisors as an economist or as chief of staff as I was, then you find out that maybe people outside have more part. But by writing an op-ed, you can have more influence than actually if you're inside making the decisions because the decision makers inside, they are very much subject to outside pressure. And what goes on outside is very important to that. So the people who speak on TV, the people who write op-eds in newspapers, they're very influential on what happens. That's interesting. And in your career, have you worked with parties that have been able to provide pressure and influence in government? Have you done that yourself? Is that something that you've taken on or is that something that you've just been almost on the receiving end up and you've worked within the confines of opinions that have shaped government that you've been part of? When I was at the American Enterprise Institute in the 1990s during President Clinton's term in office, there was Hillary Clinton's effort to have a health care system and change the health care system. And when I was at the American Enterprise Institute, I helped organize a series of monographs that shed light on what would actually happen if her proposed system were implemented. And this worked a lot towards, I think, the end of that proposal, showing that people wouldn't have any choice in their doctors, showing that costs would rise and the negative aspects of a health care system that was government-driven rather than driven by the private sector. That's very interesting. Obviously, that's very topical. And actually, because I think that it's something that is very top of mind for everyone, I have a million other things that I'd like to go into. Obviously, over the past two years, there's been a lot of a lot of items that you have a credible experience. But that particular point, can I ask and go into that just a little bit because I'm Canadian? Yeah, absolutely. And I want to understand is the system that we have in Canada, for example, it seems by a lot of people think that it works well enough. I mean, the way times are not great compared to private and whatnot. But when you look at a system like what's in Canada and probably what's in many countries in Europe, why is there not a solution that we could think through financially, fiscally, that would work in the US or maybe on the other end of the spectrum, maybe you would disagree that these other systems actually do work well and maybe taxation and whatnot has sort of gone out of, you know, it's too high because these systems have been implemented poorly. So what's your take on that? Well, the system in Canada is very interesting. It's publicly provided. There isn't a charge for it. But we find that many Canadians come to the United States for their health care. So we do find that and some Canadian politicians as I, you know, better than I do have got into trouble for coming to the United States for having COVID vaccines in advance or even some other kinds of medical procedure prior to COVID. So there does seem to be problems with that system. In the UK, there's the National Health Service. But doctors are allowed to practice privately as well as be employed by the National Health Service. So you find that they might work three days or four days a week for the National Health Service on one or two days in private practice. And there are insurance companies that pay for the procedures for private practice. So there's a system called Bupa BUPA that many people have as a form of compensation when they work in the private sector. So they seem to be able to balance both the National Health Service is a basic safety net. And yet there's an off wrap for people who need to have procedures privately. Actually, that seems to be, I think that in any argument that I've an any debate that I've ever had about health care, I think that's actually always been the the best possible solution. Almost like a private public two-tier health health system. Because I think that what happens, I don't spend a ton of time on this. I just find it incredibly fascinating topic and you spend time researching it. I think a lot of great doctors leave countries where there is only public options. And then you lose some of that talent. Like you mentioned, Canadians come down to the US for treatment. That's not uncommon because the wait times for treatment are too long or the specialists are too booked up because there's too many patients trying to see the specialist. And then you're left with, well, if you have something serious or even not serious, it's going to take you six months to to get it checked out and sometimes treat it. So that's also not a good solution when you have just pure public and people, they people, they want to make money, doctors want to make money. They come down to the US and the country loses a lot of talent and a lot of a lot of skill. But right, or else in Canada, they're allowed to practice privately. But if they practice privately, then they cannot be in the public system. So you have some specialists who are practicing privately, but then normal people who want to see them can never do that. Correct. Yes, exactly. So I didn't realize the UK did that, had their system like that. And in your in your opinion, would that be a system that would work well in the US, something along those lines? So in the US, we have a Medicare and Medicaid and these, this provides a basic safety net. And then there's the Affordable Care Act insurance, which is subsidized for people below certain income levels, a relatively high income level. So you can be earning almost $100,000 for a family of four and still get subsidies under the Affordable Care Act. But the problem with US insurance is that it's partly employer provided, which has meant that it's difficult to have competition in the supply of these insurance products. So for example, you don't hear people say, I'm losing my job, I'm going to lose my home insurance or I'm losing my job, I will be able to drive, I will get auto insurance, but you do hear them say, I'm losing my job, I will get my health insurance because it is so closely tied to the employer. So something has to be done to level that playing field, either by making that employer provided insurance taxable or by making insurance purchases outside of the employer tax deductible. And I think the second root is probably the way to go because you cannot have such a big change right now with the institution that's built up of employer provided health insurance, making that taxable right now would be too big a change. I want to, so obviously this is one major issue that should be solved for for the average American person, but obviously that's not the only issue and that actually this will, I don't want to spend too much time on healthcare because there's a lot of other incredible insights that you have around what's happened. So we look at inflation, that's an incredible topic that I think you have a lot of expertise in. We're looking at the highest inflation numbers since 1982. So, you know, you've been working as an economist for, I don't even know how long, longer probably like a long time, like a fairly long time if you were around with the Reagan administration. So you've seen everything. So what has caused this inflation? Let's simplify what the major drivers are because we hear the different causes from different politicians, different news outlets. You've been around working with the numbers, working with different different administrations. So what has caused this? There's been vast monetary accommodation from the Federal Reserve and there's been a big fiscal policy expansion in the beginning of 2021. Rates have been very low during, we saw that GDP growth was very strong at the end of at the end of 2020 and yet at the beginning of 2021 there was another two trillion dollars of stimulus put in the economy and this kind of pitched everything over the edge. People were being paid to stay home at a time that GDP growth was around six or seven percent. So consumers wanted to buy services, they wanted to buy products at the same time stimulus checks were being sent out that encouraged people to stay home, expanded unemployment insurance benefits, encouraged them to stay home. It's as though you gave everyone coupons to eat at McDonald's, everyone went to McDonald's but then yet the staff didn't show up and there wasn't enough people to produce all the hamburgers and french fries. That's a bit what it was like. So we had these major supply chain problems that drove up the prices and we have yet to recover fully from that. So the combination of a very loose fiscal policy with a lot of spending together with interest rates that were close to zero and there have been people right in 2021 in the spring, people like Mickey Levy of bear and bug capital, one of the smartest economists around was saying you got to be careful of inflation, you got to watch inflation. The same time the Fed was saying no it's transitory, it's just going to go away but it didn't go away. It was growing in nights about 8.5 percent. The producer price index is above 11 percent. So now the Fed is in a really tough spot. They don't want to have to raise interest rates too quickly during an election year. They don't want to seem to be political. On the other hand, they don't want to be left with the legacy of double digit inflation. So the question is what to do. So that's an incredible point and I understand where it's coming from but the Fed is also buying billions in treasuries and mortgage back securities. So tell me why does that make sense when they're already trying to solve the first problem that they created. This seems to be compounding the issue. That's a great question Scott while they have announced that they have stopped buying the treasuries and mortgage back securities and they're whittling back their multi trillion dollar balance sheet. So they are starting to move in the right direction. They raised interest rates by a quarter of a percent of the last meeting. Many people say they're going to be raising them by half a percentage point at the next meeting in early May. So we'll have to see what happens. They have another six opportunities to raise interest rates raising the federal fund rate this year. And we'll have to see if they do it in what's called 25 basis point increments. That's a quarter of percentage point or 50 basis point increments, which is half a percentage point. But if they do it in 25 basis point increments, at the end of the year will be left with a federal funds rate of 2.9%. Inflation is now running at 8.5%. We have never managed to get inflation down by having a federal funds rate that's lower than the inflation rate. So whatever strategy they're using is going to have to be helped by President Biden. He can actually do something also to help bring inflation down. An exerting downward pressure on energy prices and commodity prices. And he needs to be working in tandem with the federal reserve on this to bring inflation down. Now is he doing that? Is he proactively doing that right now? Well, so far he is not. He could be doing a lot to lower energy prices by expanding production in the United States. So he said that he's taking oil out of the strategic petroleum reserve. But we have the biggest strategic petroleum reserve right here under our feet. And we could be expanding oil production offshore and in different areas in order to lower the price of oil. North America is the largest natural gas and oil producing region in the world. And we should be taking advantage of that. You know, Scott, prices are set by expectations. So if the press announced that he was doing something different, then the price of oil could fall by $10 or $20 a barrel just on expectations of greater production and lower prices. But so far he has not announced that he is doing anything. Why are we not taking advantage of the resources that we have? Again, as I said in the beginning, it comes down to politics rather than economics. The president certainly knows that we need more oil production. But he's going to Venezuela. He's going to Iran. He's going to Saudi Arabia. He's asking them to produce rather than our companies here because the left wing environmentalists that form part of his base are saying that they don't want fossil fuel production here in the United States. So yes, oil is going to come out of the ground, but it's not going to come out of the ground here, which is not really going to help climate change because regulations here to produce oil are so much more stringent than anywhere else in the world. If you want to produce oil with the least amount of excess emissions, the least amount of excess pollution, this is the place to be doing it here in the United States. No, I agree. It seems almost counter-intuitive and counter-productive to claim that you're going to be more environmentally friendly by going to these countries. It's interesting what lobbying, I guess, can do. Let's talk about inflation. So let's talk about inflation numbers. Let's talk about the average American's ability to consume. If we do not tame inflation, if we do not move it in the right direction, what's the reality for the average American? How's it going to impact that? Well, already the average American is seeing lower and slower wage growth because of inflation, with inflation running at 8.5%. And average wage is increasing by 5.6%. And that's just the average. A lot of people are getting raises at all. And then people are finding that their incomes are shrinking. They still have pretty good balance sheets from the stimulus funds that they saved. But ongoing, inflation is going to be cutting into their incomes. They won't be able to buy so much. And so that is how a recession starts. We have to hope that it doesn't get to that. Help me understand, as somebody who is not heavily understanding of finance and your domain of expertise. But the recession that could come of this is it lesser or greater than what we've seen in the past. But past recessions, excuse me. Well, no one knows, Scott. In fact, we're hoping that the Fed can get inflation out of the system without a recession. But if it does it gradually now, it might be a slower, a smaller recession, smaller negative growth rate than if they left it to double digit inflation. It's always easier to attack inflation in its initial stages, especially now with the supply chain problems. If we can solve some of the supply chain problems, we might only have to deal with 4% inflation, which is only 2% points above the Fed's target, which is 2% inflation. So I talked about energy prices, how the President could help get those down. He could also reduce the price of commodities by taking off some of the tariffs. We look at steel and lumber. We still have tariffs on those from the Trump era. President Biden could get rid of those. In fact, he's got rid of so many Trump era policies. You have to ask why hasn't he got rid of the tariffs. So that's something that he could be getting rid of. He could also be looking at wage rates and the cost of infrastructure spending. We passed this trillion dollar infrastructure bill. He signed it into law in November. But a lot of the projects have to be taken, have to be undertaken with project labor agreements. That means only high priced union labor can be used. And unions are about 13% of all construction companies. 13% of all construction companies are unionized. So that's leaving out the lowest cost 87% of them. So there's no reason for the President to be just allowing union labor to be building infrastructure in the United States. Does other companies that can be doing it too? We don't have to artificially raise the price of labor. I just want to take a second and thank the HubSpot podcast never for supporting success story for part of the network. If you love podcasts, the HubSpot podcast network has other incredible podcasts like entrepreneurs on fire hosted by John Lee Doomass. Entrepreneurs on fire is one of the OG entrepreneur podcasts. It really stokes inspiration, share strategies to fire up your entrepreneurial journey to create the life you've always dreamed of. It has unlimited energy, value and consistency. The podcast is truly for anyone who wants to learn more about entrepreneurship. If you like fast paced, packed with value stories as shows for you, John brings on great guests. He speaks about failures, aha moments, what's working for them currently. If you love podcasts, go listen to entrepreneurs on fire wherever you get your podcasts. And you mentioned one thing that was interesting. So sort of two points that came out of that, Biden does not remove tariffs on certain items, but also the fact that he's that we're still mandating union labor for a lot of these jobs. The point about tariffs, why would you not remove those if that would benefit? Why would what would be the purpose as to why you wouldn't do that? It seems very obvious that it should be something that should be done if it's going to help improve the situation. Yeah, yeah, it seems very obvious, but there's a populist view that you want to protect Americans, you want to protect American workers, but now there are 11 million unfilled jobs. Anybody who wants a job can get one, but it's an element of populist protectionism, which again is more politics than economics, even though there are far more people who would benefit from lower prices on steel and lower prices on lumber. There's small groups that are very influential who basically have the say as to what happens. And I would recommend getting rid of those tariffs and lowering some of those prices of commodities. There's a lot that President Biden can do to help reduce inflation, help the Fed out. I'm curious about your opinion on on of course people, we're getting stimulus checks over the course of COVID and that allowed people to for a while not be working. What's the current state of that and how are we pushing people to go back to work so that they're not comfortable at home? Is that still a reality for some people that they aren't going back to work? The labor force participation rate, the share of Americans who participate in the labor force is about one percentage point lower than before the pandemic. And during the pandemic many people had to stay home. Kids who are home from school, you can't just go out and leave your kids at home on Zoom. So we have to hope that schools are going to come back fully that they won't all of a sudden have a Zoom day because that makes parents very uncomfortable, very uncomfortable about going back to work if they think all of a sudden that their child is going to be have a Zoom day at school. So we need to really fix the school, the school problem and make sure that schools are in person all the time. So bring stability to people, a normalcy back to people's lives. Right. Exactly. Yes. And I think that what once that happens people are going to be drawn back into the workforce, although there are people who were near retirement who find that they cannot get the jobs that they used to have and that they are unable to go back to work. There still is a prejudice against employing older workers and some of those might not return. You might take early retirement and decide to not fully participate in the workforce again. Now it's interesting. I think this is another interesting problem to solve for lots of problems to solve for. But if inflation is increasing the cost of living and employers are trying to incentivize people to come back to the office, they're going to probably have to offer higher wages to incentivize those people, which will in turn then increase the pressure on inflation if I'm not mistaken. So how do we, this seems to be almost like a like a horrible self-fulfilling prophecy, where even if we're trying to incentivize people to bring come back to work, which can be benefit by doing so, the actions that we take and the levers that we pull to do that are actually going to put more stress on the country. So is that something that you would have a suggestion as to how do we solve for that particular scenario, which would help people get back to work? It's called yes, it's called the wage price spiral and the fed raises rates. As the fed raises rates, we find that measures of labor demand and vacancies begin to moderate and then nominal and real wage pressures are likely to ease. So that works itself out as the fed raises interest rates, slowing the economy a little bit. As the cost of borrowing goes up, then companies cannot embark on some of the projects that they did before. And so that's a consequence of the fed raising rates, the demand for labor might moderate and that means that high wage increases will no longer be as apparent. It's not just wage raises, by the way, firms are offering competitive compensation packages and that also means some combination of remote or hybrid work, completely remote or remote a couple of days a week. And that has very interesting consequences also for rental prices of commercial real estate downtown or the status of public transit systems which rely on millions of people every day. So if you take half those people out because they're going to work at home, what's that going to do to your public transit system and do we really want to be putting billions of dollars into these systems that are no longer going to be 100% used to that fullest extent? That's a very interesting, it's a very interesting effect of all the changes that are going to be made. Do you have some obviously we can only forecast and look at the crystal balls so much? But if you're going to speak about some of the things that will be heavily impacted, you mentioned to there commercial real estate transportation systems with the future of work and the way that we've evolved to work from hybrid and work from home, where do you think that's going or what do you think that will affect? We've all learned how to do zoom, how to do teams, how to do these different modes and people don't want to give them up fully. Plus there's the efficiency of maybe saving an hour commute on some places more than an hour commute. So we can really see certain productivity enhancements in being able to do remote work. Plus it means that employers have access to labor all over the country in some places all over the world. So there's real, I think that there's a lot of appeal in some share of remote work. On the other hand, you do learn a lot being with colleagues at the office, you bounce ideas off them, you can work with them better if you've met them in person. So it's one thing to leave a workplace and go remote than you know everybody who's at the other end of the camera. But then as time goes on, if more people join, you haven't met those people in person, it doesn't work quite as well. So I think that what might be developing is this hybrid model where some companies choose to just bring in people a few days a week, then this provides a better compensation package for these individuals. The cost of meaning that they don't have to pay them as much. True. And the cost of living in the city may not. A job that's not right. They don't have to live in New York. They don't have to live in a major urban area either for for somebody. Right. Exactly. Yes. Yeah. And when you, you know, a lot of what a lot of what is very apparent after speaking with you, even for a short period of time, is that a lot of the logical decisions that should be made are not being made because of politics. So who are the groups that should be under scrutiny? Who are the groups that lobby politicians that people should be watching? Because everybody watches who's in office, everybody watches administration. But ultimately, there's a lot of organizations that that don't allow the person in office to operate in the most logical way. So who are the people that should be under the microscope so that we can make smarter decisions about where we spend our money, how we do business, how we interact with the world and it also internally. What's your recommendation on that? Well, I think that there's, I can give you an example from the left and and an example from the right. I mean, let's take an example from the right. One would think that with 11 million unfilled jobs, one would have a more sensible immigration policy that there are a lot of unfilled jobs. It would be easier to get legal visas for guest workers, for some engineers, for some positions that were not completely filled. But no, the anti-immigration groups wield a huge amount of power and an immigration policy such as Canada has where people get points depending on their skills and these points for different occupations are adjusted, depending on the skill mix needed. This is something we should be copying in the United States, but we're not due to political pressure. Then on the left, there's environmental groups that wield a very substantial amount of power and they say that this is because of climate change, but it doesn't really help the climate, for example, for our entire fleet to be electric. We're importing the batteries from China. We have to run the batteries off power, which is produced by fossil fuels. We're mining for minerals such as copper and lithium and cobalt. We don't have enough hope. We're driving these prices up, which by the way is also contributing to inflation. And yet GM has announced that all its cars that it sells in 2035 are going to be battery-powered electric, even though what Americans bought last year was about 5% battery-powered electric, and of those about two thirds were Tesla's. So that environmental group wields a huge amount of power. Also, one cannot tell where the funding from these groups come from. It's in China's interest to have us hooked on battery-powered cars, just the same way it's in Russia's interest to have Europe hooked on its natural gas exports. And in neither case, is it good for Europe or is it good for us? We have to be questioning as to where the funds, where the environmentalists are getting these particular funds. It's a very difficult problem to solve for because I always tell people if you want to make change and you should take action, you should vote with the corporations that you support and you invest in or you vote politically. But these are, it seems like these are far beyond the ability of the average person to influence outside of exposure op-eds, almost like a little bit of scrutiny into some of the organizations that impact government. All right, yes. We have to hope that the American people continue to behave in a sensible manner, which is buying lower-cost internal lower-cost gasoline-powered vehicles, where you don't have to wait half an hour to charge up. Or if there's someone in front of you, an hour to charge up, or two people in front of you, that's an hour and a half to charge up your vehicle. So a lot of Americans, despite the tax credits, simply are not buying the electric vehicle high. I just want to, I have like one more sort of segment that I want to go into, but before I pivot, do you have any closing thoughts on just like open the floor questions that I didn't ask? What should I have asked you about inflation or the past two years supply chain that I didn't ask that you think would be valuable to teach over to somebody? No, I think that you've covered everything. I don't think I've covered everything. You have covered everything. You might want to ask a question about tax. Taxes. Okay, so the U.S. to me is an interesting system because it's so fragmented because you have all these different states that have wildly different taxation policies. Now, let's understand, see when I look at, when I look at states that have the highest taxes, I don't feel like they're run any better than states with the lowest taxes. In fact, sometimes quite the opposite. When I look at where tax dollars go, I look at examples of countries like more socialist countries that have higher taxation and I see civic improvements and I see infrastructure improvements in Europe, for example. Some of the cities are beautifully done and you can tell a lot is reinvested, but talk to me about American tax policy. Why do we not have when we have such high taxes in certain states, the same attention to detail, the same investment and infrastructure. It seems like a lot of it goes up in smoke. We find that these states with high taxes and the highest taxes in the country are in Connecticut, New Jersey, New York City, California and we find that people are leaving these states and going to lower tax states. So there is definitely a pull from lower tax states. And we see a lot of homelessness, crime, dirt in these high tax states and areas. So they don't seem to be doing a better job and it's always interesting to look at how people are voting with their feet. But in terms of national taxes, we find that American taxes are lower than those abroad and that people are voting with their feet to come to the United States. They could be paying higher taxes in Europe with the say 20% value added tax. They could be getting free healthcare, free university, very generous pensions, but so many people want to come here to the United States. What do you think that is? What draws people? Yeah, people want equality of opportunity. They're not looking for equal. They want to have the chance to rise up and they want the chance to do well in their jobs in their careers. And what's puzzling is that President Biden right now is benefiting from President Trump's tax cuts in 2017. We have a top rate, individual rate of 37%. We have a top rate of 21%. President Biden goes out and he quite rightly brags about the number of jobs created. But it's partly due to the tax regime that he is proposing to overturn and raise corporate tax rates to 28% from 21%. And individual taxes are at the federal level up to 39.5%. So it's just very interesting to see that he is not appreciating the benefits of the low tax regime that his predecessor left. And his economy might not do so well if Congress did vote in the Thai taxes he's proposing. Now this is an election year. Congress does not generally vote for high taxes in an election year. So they won't pass. So in a sense he can have the best of both world. He can propose them knowing they won't pass. And yet he can pat himself on the back for doing some kind of proposed redistribution. But we are doing very well under these 2017 taxes. And we hope that they're going to continue. And and help me understand something as well. Because it seems like when organizations are very large, they find legal ways to allow themselves out of increased taxes. So they find ways to headquarter in other countries and whatnot. So is this whole we're going to tax the rich and we're going to we're going to increase taxes for corporations. Is this all just you know trying to try to get the the base on board trying to make people that like the sound of that excited about what you're proposing? Does it actually impact significantly the people that it's supposed to affect? Well, especially since we have multinational corporations, we have multinational corporations, they produce all over the world. If they are going to face high taxes in the United States, they are they might be limited to the United States in terms of our production for the US consumer market. But they can of course go anywhere else to service their markets overseas. So yeah, the reason that taxes do not bring in as much as people expect or the congressional budget office forecast is often because corporations can make utility maximizing decisions and locate somewhere else. The EU is talking about a global tax, a global minimum tax. But one doesn't know if this is actually going to happen because there are always countries that can offer lower tax rates such as Ireland, for example, or Hungary, the deal always want to go along with the minimum tax. But the minimum tax they're talking about is 15% the tax that President Biden is proposing for corporations is 28%, so one would expect to get quite a lot of leakage from that revenue as corporations quite legally decide that there are better places to do their operations. Now the million dollar question obviously because of your experience, I would ask you if you if you were president, if you had no no lobbying groups, which levers would you pull across the all the different things that we've discussed? We've and there's a million different ways that we can solve these problems. But if you were tasked with solving these problems, what are the main things that you would look at fixing and executing on immediately that could solve for inflation? That could solve for maybe any of the items that we just touched on to be honest, what are the things that are top of mind for you that you'd like to change if you could? Well, the first thing I would do is have a policy of producing oil and gas in the United States and importing more oil from Canada. I would restart the Keystone XL pipeline so that we could have oil from Canada to be refined into gasoline. That would lower the price of oil, lower the price of gasoline. I would end the mandates for electrification. I would just say people want to buy electric cars, they can buy electric cars, but we're not going to give tax subsidies for them. We're not going to mandate that a certain share of vehicles be battery powered by a particular year. I would roll back all that. I would roll back the project labor agreements for infrastructure construction, and I would say to the states that they can use whatever labor that they want to use. For that, I would right away take off the tariffs for steel, lumber, aluminum, whatever other tariffs there would be. So there's the top three things that I would do. And now this is less of a question based in data and logic, but I'm still curious. What's your outlook for the next five years? Is it an optimistic one in regards to where we're going? Do you feel like the people that are making decisions are trying to make the right decisions or is it more pessimistic? Do you feel like do you think we're going to go into recession and have a not so great next five years? Well, I'm naturally an optimist, and I realize that I'm an optimist, so I'm the wrong person to ask this question. But the wonderful thing about the United States is that when there's a problem, when people are on their, when our politicians are on the wrong track, there's a correction. When some group gets too far to the right too far to the left, there's a correction and there are elections coming in November. Many people forecast that the Republicans are going to take the house and the Senate. So we'll be in a position of gridlock where politicians cannot do too much harm and they have to work things out and do things in the middle. And I think that's going to produce very beneficial results. So I'm very much optimistic about the United States the next five years and next 10 years, the next 15 years. I'm an immigrant from England originally, and I can just see the vast opportunities that United States gives to everybody. I love that. And generally, like your views are lower taxation, less regulation is more or less the general. Yes, yes, yes. Well, cost-efficient regulation. Yes. Understood. Okay. Perfect. Okay. Is there any other points that you wanted to touch on? I learned a lot. So I appreciate you taking the time, but I want you to just close out with any other things you wanted to go into. And then I also would love people if they want to consume more of your work. Where should they go? Social, website, other things that they should go check out. Right. Well, my website is diannafr.com. So they can read everything I've written on diannafr.com. Okay. Perfect. No, that's a great. And I'm a columnist for full. I saw that. Where you have a right about transportation and technology. Amazing. Okay. Let's do a couple rapid fire to pull out, to pull out some career insights from you. You can go as in-depth or as short and concise as a saint as you'd like. So first question, what keeps you up at night right now? What are the stressors either in at a global macro level or maybe in your own personal or professional life? What is something that troubles you? Having lived through the inflation of the 1970s and 1980s, I'm very, very concerned about inflation. And I hope that we're not going to get to the stage that we did in the early 1980s when inflation was in double digits. The first mortgage I got was 15% interest. And now people are saying, well, a high mortgage is 5%. Well, I remember when it was 15%. So we definitely do not want to go down that path again. I'm very, very concerned about inflation. I'm also very concerned about people being forced into electric vehicles and having to rely on these batteries that are imported from China. China is not our friend and we don't want to be relying on a source of energy from a foreign power. Quite irrespective of the problems with range taking half an hour to recharge or people not having battery charges in their homes. You might, if you live at a suburban house, but you don't, if you live in an apartment block and you pack your car on the street. So those are two things that I'm very concerned about. If you had to pick one challenge that you've overcome in your personal or professional life, what was that challenge? Had you overcome it? What did it teach you? So my challenge is that I don't really like schmoozing and cocktail pad is a network. But this is very important to getting ahead. So if I'm invited to an event, I would much prefer to spend the evening at home reading. But I have to force myself to go out to these parties and meet people and I mean, even people from different different administrations, cocktail party type settings. So I would encourage young people or anyone looking for a job to go out there and socialize because you get new jobs by networking. I got my job in the Reagan administration because someone I knew called me up and said, Diana, why don't you come over and do this job? I've got other jobs for the same reason. So you have to force yourself to go out and be social. I'm not a very social person and I'm not very good at cocktail party conversation. But networking is very important and I've had to force myself to do that. If you had to pick one person who's been incredibly impactful in your life, who was that person and what did they teach you? I would say, I would say probably my father who is a transportation economist and engineer and he not only was very knowledgeable about economics, but he is a very kind and gentle person. He always treated everybody the same when we came into his office. The security guard would know him. He'd know the name of the security guard, his kids, his wife, et cetera, et cetera. So I would say that he has been very impactful in my life. If you had to pick a book or a podcast, something that you've consumed that you'd recommend someone who's listening, go check out. It's very important to read for pleasure. It's a really excellent way to relax and I have very much enjoyed the works of Anthony Troller who wrote many, many books. They provide a window into the 19th century. He had a job in the post office in England, but he would write from about 4 a.m. to 9 a.m. and then he would go do his job, frequently on horseback as a post office survey. He was actually the person who invented the letter box. The red letter box that was so iconic in London and I would highly recommend his books. If you could tell your 20 year old self one thing, what would that be? I would tell my 20 year old self to finish that Oxford PhD that I left with just a little bit remaining and finish up that PhD and I think that would have made a big difference in my career instead of leaving with an end fell rather than a default. Well you haven't done too bad for yourself regardless. And last question, what does success mean to you? Well success means having a good marriage and a good family and a place to come home to at the end of the day. So you're at work, you have to fight for your beliefs, you have to stand up for different things at the office. You frequently encounter people who are not nice to you, who you have to be nice to, but then you come back and you have a family and this is a much more important than the different jobs that you've had and I started off earning a very small amount and I've had different career changes where I've had more important positions but the amount of money I've earned has not really affected my happiness. The most important decision people have is who they're going to spend their lives with, who they're going to marry, who they're going to have as a partner and I'd like to say that I've never met someone who said they had too many children. I've met people who have regretted not having children or who said they've had too few children but marriage and family are really the foundation of happiness.