S1 | Public Policy

Mayors Steve Benjamin & Michael Tubbs: The History of Institutional Racism | SALT Talks #14

“The silver lining of all the things we’re going through is that it’s activated so many folks to realize their individual responsibility.”

Stephen K. Benjamin has been mayor of Columbia, SC since 2010 after getting his political start at age 29 in Governor Jim Hodges cabinet. Michael D. Tubbs is the mayor of Stockton, CA and was the city’s youngest ever to hold the office at 26. Benjamin and Tubbs each represent their city’s first ever African-American mayor.

Both mayors offer their thoughts on some of the most pressing issues around racial inequity and civil unrest. They share their unique perspectives on the history of institutional racism and how it manifests today. “The conversation we're having about, not just police brutality, but really about equality under the law, has been a 400-year conversation in this country.”

Benjamin and Tubbs also discuss some of their ground-breaking policy initiatives from police reform to opportunity zone investments designed to break the cycles of inequality and poverty.

LISTEN AND SUBSCRIBE

SPEAKERS

Stephen.jpeg

Stephen K. Benjamin

Mayor

Columbia, South Carolina

Michael D. Tubbs.jpeg

Michael D. Tubbs

Mayor

Stockton, California

EPISODE TRANSCRIPT

John Darsie (00:07):

Hello everyone, and welcome back to SALT Talks. My name is John Darsie. I'm the managing director of SALT, which is a global thought leadership forum at the intersection of finance, technology, and public policy. These SALT Talks are a series of digital interviews we've been doing, during the work from home period, to replicate what we do at our SALT conference. Which, I know one of our guests today was at our SALT conference in 2019.

John Darsie (00:30):

What we really try to do is provide a window for our audience, into the minds of subject matter experts. As well as provide a platform for big, important ideas, that we think are shaping the future of the world. We're very excited today, to bring a very relevant and topical discussion to you today, with two of the great American mayors, and two African American mayors, who have been pioneers in their communities, and have definitely been leaders in tackling some of the issues of racial inequality and social activism that we're facing today.

John Darsie (01:00):

Those two guests that we're very thrilled to be welcoming today are Mayor Stephen K Benjamin of Columbia, South Carolina, and Mayor Michael D Tubbs of Stockton, California. I'll introduce you to the bios of these two great mayors, before Anthony allows them to dive deeper into their backgrounds.

John Darsie (01:17):

Mayor Benjamin has been the mayor of Columbia, South Carolina, since July of 2010. He's the first African American mayor of that city, in the city's history. Before serving as mayor, he worked in the Columbia area as an attorney, and served on various charitable organizations. Mayor Benjamin previously served as the 76th president of the US Conference of Mayors. He's a leader within the mayoral community in the United States.

John Darsie (01:42):

Mayor Benjamin's, I would say better half, but as Anthony would say, better 9/10ths, his wife is the honorable DeAndrea Gist Benjamin. A judge in South Carolina's 5th judicial district. Together they have two beautiful daughters. He graduated with a BA and a JD from the University of South Carolina, where he served as the undergraduate student body president during his time as an undergraduate, and as the student Bar Association president during his time at the USC law school. We're very thrilled to be welcoming Mayor Benjamin today to SALT talks.

John Darsie (02:15):

Our second guest is Mayor Michael D Tubbs, who is the mayor of Stockton, California. Michael is 29 years old. He's the youngest mayor in the United States. Upon taking office in January of 2017, he both became Stockton's youngest mayor, and the city's first African American mayor, so he was a pioneer in multiple ways.

John Darsie (02:34):

Michael was also the youngest mayor, as I mentioned, in the history of the country, representing a city with a population of over 100,000 residents. Before becoming mayor, Michael served as Stockton's district six city council member, where he was elected at the age of 22 in 2013. He became one of the youngest city council members in the country at that time.

John Darsie (02:57):

He was included in Fortune Magazine's 2018 Top 40 Under 40, and Forbes Magazine's 2018 list of 30 Under 30. He graduated in 2012 from Stanford University, with a Bachelor's and Master's degree, with honors. He's been a college course instructor for the Aspire public schools, and a fellow at the Stanford Institute of Design, and the Emerson Collective. He's a Stockton native, and a proud product of the Stockton public school system.

John Darsie (03:25):

We want to thank Mayor Michael Tubbs, and Mayor Stephen Benjamin, for joining us on the talk today. Conducting the interview will be Anthony Scaramucci, who is the founder and managing partner of SkyBridge Capital, which is a global alternative investment firm. As well as the chairman of SALT, which you all know, because you're here today.

John Darsie (03:43):

I'm going to turn it over to Anthony for the interview. A reminder, if you have any questions for Mayor Tubbs or Mayor Benjamin, please type them into the Q&A box at the bottom of your video screen. With that, I'll turn it over to Anthony.

Anthony Scaramucci (03:54):

All right, John. Thank-you very much, both of you, mayors. Thank-you so much for being on with us. A couple of weeks ago, I saw a cartoon in the New Yorker, and I thought it summed up our times. It was a picture of an anchor person at a desk, and they basically said, "Well we just heard the weather from the Democratic weatherman. Now let's get the weather from the Republican one". The point being, is that we're now arguing over the facts.

Anthony Scaramucci (04:22):

Our civil debate has gone awry, because we can't even stipulate what the facts are in our society anymore. I thought it was a very interesting point, as we start this segment. You can see it in relative civil strife that's going on in the country. My first question, and I'll start with you, Mayor Benjamin. Then maybe Mayor Tubbs can answer it afterwards. Then we can just have a free flowing conversation.

Anthony Scaramucci (04:47):

My question is, what are the facts right now? Where do you see the facts, in terms of our society? Where do you think the society needs to go to heal itself?

Stephen K Benjamin (04:59):

Wow. That's a great question. Thank-you, Anthony, and thank-you, Darsie, for reading my intro just like I wrote it. I always appreciate that.

Anthony Scaramucci (05:07):

Your mother wrote that, Mayor. Who's kidding who? I mean, that was unbelievable.

Stephen K Benjamin (05:10):

It would be 20 pages longer if my mom wrote it. You know, the facts are, we are dealing with the greatest public health crisis, pandemic, since 1918. That we are dealing with an incredibly inconsistent economy. The first quarter, we saw probably the greatest economic disruption since 1932. Right now, on the streets of America, we're hearing incredible amounts of pain and passion, unlike anything we've seen nationally since 1968. All wrapped up into a couple months.

Stephen K Benjamin (05:45):

At the top of the food chain, at the head of this $23 trillion GDP, that this past quarter we saw the national debt go up significantly. We watched GDP drop five percent or so. We have political dissension, disruption. We're in an amazingly challenging place. I believe it's time for us to have leaders who realize that, at least as it relates to those of us who are proud Americans, who recognize the challenges we've face in this country for hundreds of years. Working to become that more perfect union.

Stephen K Benjamin (06:25):

That there is no red way or blue way. That at the very least, let's try to focus on a red, white, and blue approach to building that more perfect union. The reality is, each and every one of us, and I will tell you, that's probably, and I'll talk more about it later. That's probably the silver lining of all the things that we're going through. That it has activated so many folks, to realize their individual responsibility.

Stephen K Benjamin (06:48):

That the government shouldn't solve, that it can't solve all your problems. Public health professionals can't. The business community can't. That philanthropy can't do it all. That really, we all have an individual role, to step up and create this world in which we want to live. We want to make sure our parents get their due. But even more importantly, making sure we're creating a world where people like my daughters, and Michael's beautiful young son, can really have an opportunity to live up to their God given potential.

Stephen K Benjamin (07:15):

I think it's a time for leaders. It's certainly, easily the most challenging time I've faced in my many years in government, and public service, at different levels. But we're up to the task. I feel strongly that America's mayors are leading from the front, and will continue to do so.

Anthony Scaramucci (07:34):

Mayor Tubbs.

Michael D Tubbs (07:36):

First let me say, it's always good to be on with Mayor Benjamin, who started his term as mayor when I was still a college student. I'm thankful you're still in this -

Anthony Scaramucci (07:44):

Rubbing it in, man. Rubbing it in, mayor. Go ahead.

Stephen K Benjamin (07:47):

Hey, change.

Anthony Scaramucci (07:50):

All right. I'm bringing out the brine. You're rubbing it in. That's going to be one of my questions for you, Mayor Tubbs. How did you accomplish so much? If you added my lifetime with Steve's lifetime, and you divide it by two, we're barely you. We're just trying to figure out how you got to where you are. But sorry, keep going.

Michael D Tubbs (08:06):

Sorry, I have to do it.

Anthony Scaramucci (08:06):

Keep going. Keep going, Mayor.

Michael D Tubbs (08:08):

But to answer the question, I think in terms of what's true, what's been the silver lining for me is understanding this moment we're in. With the greatest global health crisis, as the mayor mentioned. But also the conversation we're having about, not just police brutality, but really about equality under the law, has been a 400 year conversation in this country.

Michael D Tubbs (08:29):

Also, I think the fact is, we've had this conversation before. I think it's given, the cascading impacts of COVID-19, and now the civil unrest, that it's time for us to re-solve these issues. The facts are, regardless as to how we feel, where we consume news, or what we'd like the world to be, there's institutionalized racism in our country.

Michael D Tubbs (08:50):

If you look at everything from who gets loans, to how toddlers are treated in pre-school, to how discipline is dolled out in elementary school. In every institution, not just policing, there's racial bias. I think what I've been most heartened about is, I'm hearing people who are Republican and Democrats, coming to the point, "This is not made up. This is true. Let's figure out how we get towards a solution".

Michael D Tubbs (09:16):

I think the fact also is, that now is a time for real patriots, as Mayor Benjamin said. For people who really believe in what we wrote in our constitution. That we want to form a union, where all people are created equal, are entitled and able to pursue life, liberty, and the pursuit of happiness. That we believe in equality under the law, for everybody in our country.

Michael D Tubbs (09:39):

It's great rhetoric. We've seen over the past 400 years, it's hard to put it in practice. But I think this moment demands that we push further, and push, farther, to get there.

Anthony Scaramucci (09:50):

Well, I 100 percent believe that there's institutional racism. Just a quick story. I'm at Harvard Law School, my first semester. There are three African American students, male students, in my section. They are walking on Massachusetts Avenue, to a convenience store after 11:00 at night. They're arrested by the Cambridge police. Literally, all they were doing was going to get a cup of coffee. They, blah blah blah, ensued.

Anthony Scaramucci (10:17):

30 years later, there was another incident just like that in Cambridge. I remember, president Obama got involved in it. I remember thinking, about tying those two things together. I said, "My god, there is absolutely institutional racism". It's a question for both of you. What do you say to those people who say that there isn't institutional racism? How do you ... This is my point about facts. How do you debate somebody, "Well sir, do you think there's institutional racism?". "No, I don't think there is". How do you go about it? How do you debate it?

Stephen K Benjamin (10:51):

I would encourage folks, those who care about their country, who often profess it in different ways. Often politically. To really take these opportunities to listen. My grandma would say that God gave you two ears and one mouth for a reason. You should listen twice as much as you talk. Right now, I would tell you that the most edifying and powerful conversations I've had, with people young enough to be my son, like Mayor Tubbs, and others. I went out, and I'd sit. I would say, I spend a lot of time backed by law enforcement, so I spend a lot of time with our officers.

Stephen K Benjamin (11:30):

But I also get out into the streets, and sit down with the protesters. Social distance, wearing a mask, the whole nine yards. But I don't get there and tell them about all the things we're doing, all the things their government's doing to make their world better. I just sat there and asked them, "Tell me your stories. I want to hear your stories".

Stephen K Benjamin (11:46):

If you listen to what's happening in the world right now, so those classmates of yours from 30 years ago, and seeing the same things happen 30 years later. I assure you, 30 years before that, it was actually the law of the land, and 30 years before that. The fact that structural racism, differential access to goods and services, is real in America. That we know personally, mediated racism. Unconscious bias acted on, by those of us in power, is also real.

Stephen K Benjamin (12:15):

There's also internalized racism. The challenges that we may face as individuals. You know, it is very difficult. We were chatting a little bit earlier. It's tough when you have to debate facts with people now. At least back in the day, you could at least rely on data. Data would maybe solve an argument. Or maybe you could get people to focus on commerce and economy. "Let's at least make sure we prosper together".

Stephen K Benjamin (12:43):

It seems like right now, the conversation is just awry. That's why it's so important for leaders on the national level, state level, local level, those we're talking about, inter-sectoral leadership. Not just the public sector. Really find ways to bring people together, so at least we're listening to each other. But it is, it may be the challenge of our times.

Michael D Tubbs (13:09):

As the mayor said, I'm at the the point now where, if it was really about data, I'm driving actions and decision making. We're just living in a fundamentally different world. I just read something yesterday that said, the median wealth of a black family with a college degree is only 70 percent of the median wealth of a white family with just a high school diploma.

Michael D Tubbs (13:33):

Stats like that, to me, just really illustrate, it's not about just the actions people are taking. It's not about people not having education. It's not about people not working hard. It's something that's systematic. It's insidious. But it's also literally in every institution. If I had time, we could talk, we could go through every institution. From the banking system, to the school system, to the prison system.

Michael D Tubbs (13:55):

That if the outcomes are the same, then the discussion has to be, do we really think there's something inferior about black people that lead to these outcomes? Or is there something that's being done? I think that's the conversation we have to have. What I've found, like Mayor Benjamin, in talking with people, that sometimes the data has to be connected with a story. A story of someone, if people don't know, that they see, touch, feel.

Michael D Tubbs (14:21):

I know when I talk about how, even as mayor, when I go take a run at the local university half a mile from my house, each and every time I'm greeted with campus security who are circling. Because they don't realize I'm the mayor. When they do, they wave and drive off. While my friends who aren't black, when they go around to campus, they never see campus security.

Michael D Tubbs (14:41):

I know just in sharing those stories, I think it's allowing people to realize that, "Wow". We had one conversation with some folks in the community. I said, "No, I get it. The institutions have worked for you and your family. You've seen it work. You guys have made something. I get that. But those same institutions don't work in that way for my family". When I said it like that, I saw something click. Like, "Oh, wow".

Michael D Tubbs (15:08):

I think part of it is allowing people to understand that, your experience in America, your experience with police, your experience with schools, your experience with banks, your experience with love, is not a universal experience. That there's other experiences. That doesn't make your experience less. But your experience is not the only truth.

Michael D Tubbs (15:26):

I think that's part of it. I think it's also having tough conversations like this, that are frank and that are honest, and are done in a way that has multiple races talking. I was telling people in Stockton last week, if it was up to black people to solve racism, institutional racism, it would have been solved. We've been saying for 400 years, "This ain't right. We've got to do something about it". It's going to take allyship, and just good people, who are saying, "You know what? We want everyone to have universal human dignity".

Michael D Tubbs (15:56):

It's not easy. That doesn't mean it's easy. But it's something that I would argue is very necessary.

Anthony Scaramucci (16:02):

Mayor Tubbs, do you think something has changed? I'll ask Mayor Benjamin the same question. But the proliferation of the iPhone, or the smart phone. Where now we're on top of each other, and unfortunately we witness the horrific eight minute and 46 seconds, or other situations. The one in Atlanta. Do you think something has changed now? Where now it is so frontal, and it's in everybody's faces, that it's going to cause a spiritual awakening, and that could cause an even bigger evolution? Or do you think we're just going to get more of the same?

Michael D Tubbs (16:38):

I would say, we can't do more of the same. It feels different. The protests feel different. The civil unrest feels different. Even the actions from people who I wouldn't think would even see the need to change, at least locally, have been different. I think part of it is the iPhone. But I think part of it's what you and Mayor Benjamin mentioned when we started.

Michael D Tubbs (17:01):

It's the fact that COVID-19 really has everyone shook, and everyone anxious, and everyone insecure. In almost a shared sense of suffering.

Anthony Scaramucci (17:10):

Mm-hmm (affirmative), there's no racial bias in COVID-19. Although we have learned that certain communities have more proliferation of it. But all of us have the same DNA, right?

Michael D Tubbs (17:19):

Yeah, well -

Anthony Scaramucci (17:20):

We're all at risk. We're all at risk.

Michael D Tubbs (17:21):

I think what's been fascinating about that, we're seeing this disease, which is not racist, it's a disease. A virus. But we see how, because of racist systems, that's attacked, some people have worse outcomes. I think that's started the conversation.

Anthony Scaramucci (17:34):

Yeah, I accept that. Yeah.

Michael D Tubbs (17:35):

People are economically anxious. People are stressed. People are tuned in. People are really deeply engaged in what's happening. I think seeing that, where it's just the straw that broke the camel's back. I think it's a mixture of the iPhone. But we saw Michael Brown on the iPhone. We saw Sandra Bland be pulled over on the iPhone. Hell, Emmett Till had an open casket funeral. It's not the first time we've seen suffering in this way. But I think it's the time, in terms of a time of great transition and anxiety in this county. Where people are saying, "What's next? What's better?".

Michael D Tubbs (18:13):

You have the election coming up in November. I think all these things have created the conditions upon which this really sparked a real movement, and a real reckoning.

Anthony Scaramucci (18:25):

Is it different, Mayor Benjamin?

Stephen K Benjamin (18:27):

No, I couldn't agree more. I do believe, honestly. I think the last time I was at SALT with you, Anthony, we were talking about just how rapidly technology's changing the world. Michael and I have done conversations on AI and automation, and advanced machine learning, and how it was changing the future of work. How that would disparately impact these various communities, that also happen now to be the same essential workers that can't socially distance, that can't remote work. That don't have access to PPE.

Stephen K Benjamin (18:58):

Certainly as we adjust to the new normal, as we work our way through the pandemic, everyone's, like Michael said, at home. Watching TV, and it was, I'm not giving much to hyperbole. But it was the very first time that millions of Americans, and billions across the world, were forced to watch an eight minute and 46 second public execution. A state sponsored pubic execution.

Stephen K Benjamin (19:25):

I think it fundamentally broke people's hearts. It fundamentally changed the way that people saw the reality. It humanized that data that Michael was talking about earlier. It put a story, a real narrative on everyone's mind, that said, "No". I've heard the stories. I didn't really believe all the facts behind Trayvon, the imagery in the Rodney King thing. You know, "I'm not sure about that". Michael Brown, "I don't know his history. I don't know what happened". This story, or that story, and the millions of stories.

Stephen K Benjamin (19:59):

Particularly Millennials, Michael's generation, and the Zoomers now, have really been sharing. But everyone was forced to watch a man rendered helpless. Die before our eyes. I think it broke America's heart, and it spurred this energy. That now, I think our job as leaders in our different spheres, is again, how do you get that pain and that passion, and turn it into progress? How do you utilize our democratic institutions, which were not all government, and channel it in a way that you can get real, immediate change, going in the right direction?

Stephen K Benjamin (20:37):

That gets us past bumper sticker responses. If it's, "Defund the police", whoever happens to answer. What does that really mean to people? Are we talking about finding different ways to invest in actually creating just communities? That's where the leaders step in. You bottle up all that, everybody having this moment, and really turn it into a real movement that moves a country.

Anthony Scaramucci (21:00):

I'm going to kick it over to John Darsie. He's got a few questions from our audience, Mayor. But I do agree with you. Hopefully this is a seminal moment for all of us, where we'll start more healing. But John, go ahead. I know you have a question for both mayors.

John Darsie (21:13):

Yeah. I know, Mayor Tubbs, you alluded to the fact that black people have been talking about these issues for 400 years. Certainly, a lot of people are now talking about police reform, and changing policing tactics, as a result of the social unrest that we've seen. I want to direct this question at Mayor Benjamin.

John Darsie (21:31):

In 2014, you introduced an initiative called Justice For All. Which implemented new training, competitive pay, diverse representation, and different elements of community engagement. To strengthen the relationship between law enforcement, and the communities in which they serve. I think in general, policing is just one element of institutional racism, for sure.

John Darsie (21:54):

But also, within policing, it's not just the idea that we shouldn't be violently confronting situations that don't need to be violently confronted. But it's just about the relationship between the police, and the communities in which they serve. How do we need to rethink, in general, policing in this country? Racism is one element of it. But just in terms of how they engage with their constituents?

Stephen K Benjamin (22:19):

Thank-you. As a city, and as a police department, we have a fantastic chief of police. We gravitated rapidly towards president Obama's leadership on 21st century policing. Recognizing that these generational challenges have existed between law enforcement, the men and women who run towards danger when we're running the other direction, and the communities that they serve. Particularly communities of color.

Stephen K Benjamin (22:41):

We formulated justice for all, using a number of the principles of his 21st century policing initiative, and decided that we would build a department that focused on, first, transparency. Because that's always been an issue. On accountability, and work and build trust. We had to completely revamp the way in which we recruited and trained our officers.

Stephen K Benjamin (23:02):

We put the president of our Columbia Urban League on our hiring board. Two years later, 68 percent of our new hires were African American, Latino, Asian, and female. Trying to get a force that looked more like the city. We put in incentives for officers, to advance in their education, in the things that we value. Obviously we put bonuses in place, for them to meet those measurements.

Stephen K Benjamin (23:27):

We also put a hiring bonus, and also a residency bonus in place. An officer who wants to move into a home in our city, because it's important that there be some type of emotional connection between those officers and the communities they serve. That an officer can move into a home. No down payment. Low interest rate. 30 year. It's a really creative program, we modify to meet our officers.

Stephen K Benjamin (23:49):

But we also went 100 percent body cam. We started recording video and audio recording of any of those charged with violent crimes. Then using data. Trying to humanize that data. To share information, and use of force. How, if there's a police involved shooting, how it's independently investigated. All again to try and change the framework, in a way that's systemic. That, whether Mayor Benjamin was there, or Chief [Holbrook 00:24:15] was there, these gains would be sustained over a period of time.

Stephen K Benjamin (24:18):

I say all that to say, John, that even those things that we did in the wake of Michael Brown's death in Ferguson, still not enough right now. Right now we're at a moment, where we're not talking only about reinventing policing as we know it. But even re-imagining. Re-imagining how you provide for safer communities.

Stephen K Benjamin (24:41):

Michael, quoting Mahatma Gandhi, talks about poverty being a form of violence. Other was in which you can rebuild communities. Maybe even, yes, we have cops right now, guys, overworked and underpaid. Because they're doing everything. We're asking them to be mental health counselors. Ask to be social workers. We're asking them to be all these things that go beyond being a guardian or a warrior, that they ought not be doing.

Stephen K Benjamin (25:10):

We'll train them, to make sure that they're well rounded and have a skillset. But that's not their job. We've got to find ways to create safer communities, so that when you have an issue that's a humble, or note a real public safety threat, you don't need strangers with guns showing up. Regardless of how altruistic they are.

Stephen K Benjamin (25:29):

We made some strides then, in 2014. But right now, we're at a point where we're even re-imagining the role of our law enforcers, and our role in helping create healthier, stronger, more vibrant and equitable communities.

John Darsie (25:43):

Thank-you, Mayor Benjamin. I want to direct a followup to Mayor Tubbs. You touched a little bit on incentivizing educational growth within the police force. Mayor Tubbs, I know you've done a lot of things, in terms of trying to promote education within Stockton. Obviously you prioritize education from a young age. You're a graduate of Stanford University, with honors. You secured over $20 million in philanthropic capital for Stockton Scholars, which is a program that, you aim to triple the number of Stockton students graduating from college.

John Darsie (26:15):

How do we level the playing field, in terms of public education in the United States?

Michael D Tubbs (26:24):

Yeah, that's a great question. I appreciate you asking that, because this moment, I think the policing conversation that we're having nationally is symptomatic of a wider conversation, that includes things like education.

Michael D Tubbs (26:35):

I think to level the education playing field, all the research says, it really starts at zero to three. Like Mayor Benjamin said, poverty is a great indicator of educational attainment. Doing everything we can to prevent families from being in poverty, or helping families who are in poverty leave poverty.

Michael D Tubbs (26:54):

All the research tells us the between zero and three, children do word acquisition, and acquire language. That has a big impact. Also, in terms of adverse childhood experiences, I think using, again data, about how adverse childhood experiences or childhood trauma impact brain development. Or impact academic success. Doing what we can, in terms of interventions.

Michael D Tubbs (27:15):

What they have in Providence, Rhode Island, where they have social workers and other people work with families, to make sure kids are reading, and hearing enough words. It means policy, like paid family leave and things of that sort, so parents can actually be home with their children. To be their first educators. It means things like universal pre-school.

Michael D Tubbs (27:36):

But I think also, if you look at the data, the data tells us that kids of color are more likely to go to schools with the least qualified teachers, and the least funding. Which seems just, it seems like it should be the opposite. Particularly if we're talking about parity. I think it's also looking at, in terms of how you make sure that every child and every school has a qualified teacher in the classroom, who's well trained and well resourced.

Michael D Tubbs (28:01):

How you make sure that they have curriculum, and education. I think part of it starts with, again, at a national level, the supreme court edict around making education a fundamental right. Because in this country, based off the Seattle ... Not Seattle. San Antonio case in 1973. Education's not even a right for American citizens. I think it starts from there.

Michael D Tubbs (28:25):

Once it becomes codified as a right, then we can have the conversation about, how do you make sure that that ZIP code doesn't correlate with destiny? That schools aren't funded solely based off property taxes? That the least qualified, the least experienced, the non-credentialed teachers are teaching the kids who are starting out a little bit more behind. How do we reverse that?

Michael D Tubbs (28:46):

Again, big issue. But there are data driven solutions. They aren't necessarily easy, but are necessarily for truly serious about using education as a lever, to help equal the playing field.

John Darsie (28:59):

Yeah. You touched on the fact that education and policing are somewhat intertwined. I think all these issues relating to institutional racism are somewhat intertwined. I want to direct this question at Mayor Benjamin. At 29 years old, it was 1999. Governor Jim Hodges appointed you as to the cabinet as director of the state's second largest law enforcement agency. It was the department of probation, parole, and pardon services.

John Darsie (29:25):

As it relates to criminal justice reform, going beyond policing, what effect does it have in African American communities and minority communities, when we're putting people in jail for non-violent crimes? When children in the African American community are growing up without fathers in the home sometimes? How do we change that system, to break this cycle of poverty, and this cycle, as it relates to poor education circumstances within the African American community?

Stephen K Benjamin (29:53):

Well I think obviously, just the fact that you're asking the question is a wonderful step forward. So many folks have refused to connect the dots, of what the effect of longterm policy decisions. The fact that we spend $200 billion a year on police, and prosecutors, and prisons. We've been able to profit, because of a number of these industries.

Stephen K Benjamin (30:22):

I literally just took a call from governor Hodges, who 20 years later, he still thinks I work for him. Some of you may know him. He's my dear friend, and been a great mentor. But he gave me an opportunity as a very young individual, to step into a place. I'd been prepared as a political science major, as a young lawyer. Very altruistic, and had all these ideas about these theories I'd learned.

Stephen K Benjamin (30:45):

To actually put them into action, running the state's second largest law enforcement agency. Be able to show people that you can actually create safe communities. We were unrepentant about making sure that people were held accountable. Particularly those that had been engaged in violent crimes. But the very same time, we had to make sure people were able to reintegrate into society, and give them a chance to live up to their God given potential

Stephen K Benjamin (31:11):

We worked with the NAACP and others, to get people re-registered to vote. We required and worked with, we established some program that actually brought people back into the economic mainstream. Gave them jobs. It was a wonderful opportunity to do so. But I think the basis of your question is also the answer to your question. Recognizing that each of these things are inextricably linked, and that we are all connected. Relationships are interdependent.

Stephen K Benjamin (31:45):

So that in order to deal with these things, it's going to take investment. It's going to take thoughtful policy. That policy's going to have to be humanized and compassionate. But very intentional. I think, and realize that some of these solutions are not going to happen overnight. That it took us literally several centuries to get here. It's going to take us time to turn the corner.

Stephen K Benjamin (32:11):

But there are some things that we can do today, right now, to start building on those communities. I would tell you, just as you know, I've spent a lot of my time in elementary schools. Even since my children left elementary school, I've been in over 300 different classrooms since I started my term as mayor. I love being around children, I love being around senior citizens. Everybody in between, I can take or give on any given day.

Stephen K Benjamin (32:38):

But when you around these children, particularly as Michael said, when they're very young, you can see the hope, and aspiration, and the promise, and the gifts. When the little boys aren't too old, they still want to hug you, and grab you, and tell you how awesome you are, and how proud they are of you. They look at the face of this African American man, and they're still trying to figure out, "How in the world did you become the mayor of our city?".

Stephen K Benjamin (33:05):

It's a special time. Then we allow them to lose that. Because they're dealing with issues that I didn't have to deal with as a child. I never had to worry about safety or security, or shelter. We lived in a rough neighborhood. But a very stable household, with a daddy welcoming the morning early. Did leave the house, giving me a kiss, and came home late at night, after his third job sometimes. Had hugs. We'd stay up late at night, and watch The Honeymooners together.

Stephen K Benjamin (33:36):

The mother, who complimented him, and made him a much better man, they're still together after 54 years. He still bossed me around too. But every child didn't have that.

Stephen K Benjamin (33:47):

Then you have to step up and say, "So what's the role of a civilized society? What's the role of a loving and compassionate community?". To stand in the gap, and put as best as we can, the structures in place, to make sure this kid gets the same shot he has. These children nowadays, I will tell you, are much more talented. Much more intelligent, digital native, than Steve Benjamin ever was. So it's my job to give them a shot, and that's what I'm going to do.

John Darsie (34:11):

Next question, before I let Anthony get back in here. I'm having too much fun, engaging with you guys on this. But you guys have both been very focused on job creation, and economic empowerment, as tools to help lift your constituents out of poverty, and create more equal outcomes. Mayor Benjamin, in your first term alone, you cut the unemployment rate in half, in your metropolitan area.

John Darsie (34:34):

What are examples of programs, either that we're doing today that you think we should ramp up, and increasingly focus on? One example being opportunity zones, which I know you guys have both been involved with. But what are other types of programs, and as an example for Mayor Tubbs, you've been involved at the municipal level in one of the first pilot programs for a version of universal basic income. In Stockton it's called SEED.

John Darsie (34:57):

I'll let Mayor Tubbs, you start with this, what are specific economic programs that we need to focus on, and need to ramp up, in order to create a domestic Marshall plan, to help create more equal outcomes?

Michael D Tubbs (35:10):

Great question. Number one, I think in terms of opportunity zones, part of the issue is, in California, is not yet tax conforming. With state and federal taxes. It's been hard to marshal interest. I think also, just having a version 2.0, that's actually more tailored to real underserved communities, I think would be a big benefit. In terms of using capital and free enterprise as a way to lift boats.

Michael D Tubbs (35:35):

In terms of the basic income demonstrations, one of the things I've been most surprised about is how money is a function of time. What we've seen is, with dollars, we just allows people to have more agency over their time. There's folks like, a gentleman named [Tomas 00:35:53], who talks about how the first $500 a month is enough for him to interview for a job.

Michael D Tubbs (35:59):

I asked him, "What does that mean?". He said, "Well, I work retail. Because I work retail, I'm not able to have a set schedule. I don't have paid time off. I have two kids, so I can't take a risk and bet on myself, and be entrepreneurial. Because doing so may mean the rent's not paid for this month. I don't have a rich dad. I don't have a real safety net to fall ... I am safety net".

Michael D Tubbs (36:21):

He said the $500 is enough for him to take two days of work to interview, and he ended up getting a better job, with more pay, benefits, unionized, etc. For me, that story's telling. Because when i think about a basic income, or an income floor, I think about our society being an angel investor in all of us. Saying, "Hey, you can't control who your parents are. We can't control the circumstances of your birth. But what we can do, is make sure you have a shot".

Michael D Tubbs (36:50):

That you have some sort of under-pinning. You have some sort of foundation, that then you could put your feet down, and buy boots and buy shoe strings, to pull yourself up by your bootstraps. I definitely think part of this conversation has to have some sort of an income floor for everyone. Particularly when we consider the unequal places where people start.

Michael D Tubbs (37:12):

Another program, or programs I'd like to see ramped up, are really just pausing discussions. We know that minimum wage has not kept up with the cost of living. We know that, in 99 percent of counties in this country, you can not afford housing with the current minimum wage. Which means we have to lift the floor. We have to increase wages. So that when people are actually working, who are actually working, and able to provide and pay, it makes no sense for people working two ore three jobs, and still not be able to pay for basic necessities.

Michael D Tubbs (37:43):

Then I think that the third thing, particularly around conversations about job guarantees. Which I think make a lot of sense. But also, we have to have, if you look at what Mayor Bloomberg is proposing, his campaign with the Green initiative". Just real targeted, specific, loan programs. Capacity programs for entrepreneurs.

Michael D Tubbs (38:04):

Going to Stanford, being in Silicon Valley, is a caricature of what entrepreneur is. But the most entrepreneurial people I've ever met are the people in my neighborhood in Stockton. Who are selling tamales, or selling things that are now legal, that once were illegal. But who have shown a business acumen in mind, who just don't have access to capital, don't have access to the teaching. But have that same grit, resilience, creativity, ingenuity, that my classmates at Stanford had.

Michael D Tubbs (38:35):

I do think target investments, for investing in, supporting entrepreneurs, in communities that have been particularly impacted by police violence, and other forms of violence, like poverty, would also make a big difference.

John Darsie (38:47):

Mayor Benjamin, do you have anything to add to that?

Stephen K Benjamin (38:50):

Just very quickly, I know we're running short on time. We try to lead from the front, and lead from example. Our city's a unique place. State government, largest army training base in the world. Universities and colleges. A significant amount of our property's done in tax rolls. We're always working with a certain limited amount of resources.

Stephen K Benjamin (39:08):

It was important to me, as commercial interests carry a significant share of the tax burden, to run just a tight ship. We've finished eight of the last 10 years with a budget surplus. Never raised taxes. We've actually cut taxes by $12 mils. We've been creating an environment where private sector capital feels welcome. It hits the ground, and you treat it well. We've been able to welcome billions of dollars of capital investment into our city.

Stephen K Benjamin (39:32):

We invest in our city. $750 million in water, sewage, and storm water investments. The work that Michael was talking about, collective leadership on opportunity zones. We try to make sure that when we make those investments, that we ask of our partners, and we dig deep into the community. To make sure these jobs are available to folks who live, and make the community special.

Stephen K Benjamin (39:58):

There are a number of great efforts out there, around UBI, that Michael's been leading on. Been doing some work with the Aspen Institute around income volatility, and ways in which we can just help people stabilize. We developed a wonderful program a few years ago called Work It Up. In which you go to one side of town, and folks, employers say they can't find employees. You go to the other side of town, people can't find jobs.

Stephen K Benjamin (40:19):

It's your job to be an ambassador, and try and connect those dots. Making sure people have the skillset, but employers understand they're not going to get perfect individuals. Who, in my faith traditionally, only one perfect person's ever walked the face of the Earth, and he's not here right now. He's here, but he's not here.

Stephen K Benjamin (40:37):

Working to connect those dots, to again have everyone participate in the largess of America. I'm also a huge proponent of public private partnerships. I think smart P3s, particularly in the economic environment in which we're operating right now. Where state and local government's going to see one tree on a short pole over the next year.

Stephen K Benjamin (40:57):

Giving a thoughtful, they have to be public private. Sometimes public private philanthropic partnerships, are giving cities and states and local governments, local subdivisions, the opportunity to unlock the capital they have locked up in some of these assets, is a huge opportunity. That six months ago, when folks weren't thinking that UBI, other than Michael and his crew, was real. But now, post CARES Act, people think, "Maybe there's something really serious here. We should be thinking about ...".

Stephen K Benjamin (41:25):

People thought that universal healthcare, I'm with Mike, we were on the same team, for the presidential election. I'm not a Bernie guy at all. But the discussions around universal healthcare being unaffordable, unsustainable, you put a $1 trillion price tag on it. Well I'll tell you, guys. We're about $3 trillion to $4 trillion in hoc right now. As we go.

Stephen K Benjamin (41:49):

A budget, and the way in which we lead, is a reflection of the values and the things that we value. We're going to have to really start thinking very creatively. Or opportunity zones. Around UBI. Around ways in which we can all win. If we reimagine everything, we can do much better than we have been over the last several years.

John Darsie (42:09):

I know I said I was going to kick it back to Anthony. But I have one more question before we wrap up. I'll start it with Mayor Tubbs. Because it's a generational question, but it's also just a societal question. It's sort of going back to what we talked about at the beginning. I want to leave everybody on an optimistic tone.

John Darsie (42:24):

That it feels a little bit different now, the social activism that we've seen, and the commitment to change from various parties. I mean, you see something like NASCAR finally coming out and leading from the front on racial issues. I'm from North Carolina. Mayor Benjamin, you're in South Carolina. These issues are things we're familiar with.

John Darsie (42:45):

But Mayor Tubbs, I'll start with you. From a generational perspective, do you think that millennials, as a result of racial issues, and just the pandemic might have caused some of this as well. Do you think millennials are going to be more engaged in the social and political landscape going forward, as a result of some of the things we've seen recently? What impact do you think that's going to have on the country?

John Darsie (43:07):

Then Mayor Benjamin, I want you to follow up. Just to talk about whether you think this movement that we're feeling right now, you have people like LeBron James, other big athletes and celebrities. Those groups have always made a push to help with voter rights, and things like that. But it seems like there's a more cohesive and energized effort to address those things. We'll start with Mayor Tubbs.

Michael D Tubbs (43:29):

I sure hope so. The reason why I got involved with government is because I realized that, I'm going to be around to live with a lot of consequences today, the decisions made today, in my older years. I just want to be part of that. I'll be here to deal with the repercussions and the actions, so I hope millennials, and Zoomers, everyone realizes that, "No, we can't wait". That it's on us. We have to work with those who are older, but we have to be part of the decision making table.

Michael D Tubbs (44:00):

Because I just don't want to have to be fighting the same fights, in the same way, talking about these same issues 20, 30 years from now. I think a lot of people feel the same way. I think particularly, millennials, most of us were born, we were 10, 11 years old when 9/11 happened. We were entering into college, or entering into the labor market when the first Great Recession happened in '08.

Michael D Tubbs (44:28):

For many of us, the only two presidents we've known, that we've voted for, are Barack Obama and Donald Trump. We grew up in a time, where Oscar Grant, Sandra Bland, Breonna Taylor, George Floyd, every month a new hashtag. We grew up seeing Colin Kaepernick being blacklisted from the NFL for protesting. I think that those formative experiences have hopefully had the impact, of getting people involved in the political process, and the political system. Exerting rights to vote, and rights to run for office. To get us to where we need to be as a society.

Stephen K Benjamin (45:04):

John, I'm encouraged by millennial leadership, and the Zoomers as well. As you might be able to deduce from our conversation and banter, Michael and I talk, text, or email almost every day. Maybe every other day. He's representative of a group of friends and leaders, both men and women, particularly, obviously we engage with mayors. But amazing leaders. Who come from Birmingham, Jackson, I mean gosh, in Atlanta. Charlotte, and Shreveport. Just some really talented young leaders, who are seeing the world very differently. But also have the wisdom of being students of history.

Stephen K Benjamin (45:48):

We're benefiting from that in a very significant way. I am also excited, we engage with a number of different individuals, including some of the athletes that you mentioned, like LeBron James and others. I think what's coolest about that is, to recognize that, you guys, when you sit down with a group of athletes, particularly some African American athletes, you'll find independents. You'll find Democrats, you'll find Republicans.

Stephen K Benjamin (46:14):

To be able to respect the heterogeneity of the group is really cool. You'll find some who believe strongly in the capital markets, and some who may be at the other end of the spectrum. But they all seem really, at this moment, to be focused on human dignity. To be focused on inclusion. To be focused on economic prosperity, for communities that have been disenfranchised.

Stephen K Benjamin (46:38):

To really be focused on making sure that people have the right to the franchise, and are able to participate in American elections, as one of their constitutional and God given rights. That's an exciting time. I do believe that, with the leadership of folks in Michael's generation, I think America is going to be in a better place. I really do.

John Darsie (46:58):

Well thank-you again, both of you, so much for joining us. Anthony, do you have any final thoughts?

Anthony Scaramucci (47:04):

Well, I want the duck back now. Guys, this guy has a fake duck. He's been sitting behind him for the last seven SALT Talks. But when the duck was there, he wasn't talking. Now the duck's not there, and all he's doing is talking, so I sort of want the duck back. But -

John Darsie (47:21):

I had to make sure we asked all the right followup questions. It's too interesting and important a conversation.

Anthony Scaramucci (47:24):

Oh, I appreciate it. He thinks he has standing, because he's from the south. But listen, guys. You're doing an enormous service to our country. Your public service is exemplary. On behalf of everybody that listens to these SALT Talks, and all of our delegates, I just want to personally thank you. You're true patriots, and I know our country's headed for a better place because of men and women like you guys.

Philip Hammond: Brexit, Boris Johnson & Financial Regulation | SALT Talks #13

“It’s self-evident to anyone with a smattering of economics that the UK’s prosperity and economic success is very heavily tied to access to European markets.”

Philip Hammond was a UK Cabinet Minister and key member of the British Government for almost a decade. Leading four departments over nine years and rising to the second most powerful job in government, he is one of only three people to serve continuously in the UK cabinet from 2010 to 2019, serving under Prime Ministers David Cameron and Theresa May.

Hammond explains his decision to leave his cabinet role as Chancellor of the Exchequer when Boris Johnson became Prime Minister because of Johnson’s openness to a no-deal Brexit. Hammond explains the economic, cultural and political factors that combined to bring about Brexit, and its consequences. “There's been a lot of resentment in the U.K. at the creeping encroachment by Brussels over our everyday lives… And it was really a reaction to that, a feeling that people wanted to restore sovereignty to our own parliament, make our own decisions, and control our own borders.”

Like the United States, Britain was likely a week or two too slow in shutting down the economy out of fear of the economic impact from lost business. Hammond offers his thoughts on the pandemic fallout and the economic outlook for Britain and the world.

LISTEN AND SUBSCRIBE

SPEAKER

Hammond%2C+Philip.jpeg

Philip Hammond

Chancellor of the Exchequer

(2016-2019)

MODERATOR

anthony_scaramucci.jpeg

Anthony Scaramucci

Founder & Managing Partner

SkyBridge

EPISODE TRANSCRIPT

John Darsie (00:07):

Hello everyone, and welcome back to SALT Talks. My name is John Darsie. I'm the Managing Director of SALT, which is a global thought leadership forum at the intersection of finance, technology, and politics. As we've been doing during this entire work-from-home period, we've been bringing you these SALT Talks, which are digital conversations with leading investors, creators, and thinkers. What we try to do in these SALT Talks is provide you a window into the minds of subject matter experts, the same way we do at our in-person SALT conferences, as well as provide a platform for big, important ideas that we think are shaping the world.

John Darsie (00:39):

Today, we're very excited to welcome the right honorable Philip Hammond to SALT Talks. Mr. Hammond was the former chancellor of the Exchequer in the United Kingdom, a role that he's served in from 2016 to 2019 when he was a close political ally of Prime Minister Theresa May. Prior to that, he was a Member of Parliament for 13 years for Runnymede and Weybridge, from 1997 to 2019. He also served in the Shadow Cabinets of Michael Howard and David Cameron as the Shadow Chief Secretary to the Treasury, and the Shadow Secretary for the State of Work and Pensions.

John Darsie (01:15):

As chancellor, Mr. Hammond pushed for an end to austerity measures. And in 2019, he spoke of his intention to tender his resignation, should Boris Johnson, the current Prime Minister, be announced as Prime Minister, due to the fact that he couldn't support a no-deal Brexit. Today, he serves as an advisor to several businesses, including in the investment management and FinTech arenas.

John Darsie (01:36):

If you have any questions for Mr. Hammond during today's talk, please enter them in the Q&A box at the bottom of your video screen. And conducting today's interview will be Anthony Scaramucci, who is the founder and managing partner of SkyBridge Capital, which is a global alternative investment firm. And he is also the chairman of SALT. So Anthony, I'm going turn it over to you for the interview.

Anthony Scaramucci (01:56):

Okay, terrific, John. I appreciate it. Of course, I have to let everybody know on the call that the duck that John used to have behind him was removed by his mother-in-law. So she came over to the house and said, "The duck is not working for him." I just had to bring it up before we get this thing started.

Anthony Scaramucci (02:10):

So Mr. Hammond, it's great to have you, sir. Philip, tell us a little bit about your background, for Americans that don't realize who you are and what you've done, and the great impact you've had on the British government in the Parliament.

Philip Hammond (02:28):

Well, I left Parliament last December at the general election, when I didn't stand for reelection following the takeover of the party by Boris Johnson. Prior to that, I was three years as Chancellor of the Exchequer, effectively equivalent of the U.S. Treasury Secretary. Before that, I was the Foreign Secretary, Secretary of State in U.S. terms. And before that, Defense Secretary for three years. So altogether, I was nine years at cabinet level government under David Cameron and Theresa May.

Philip Hammond (03:02):

Now I'm out, as John said, advising a number of businesses, but also still taking part in the ongoing public debate, of course, now about COVID and how we manage the effects of COVID on the economy. But also, right here in the U.K., we still have running the ongoing discussion about our future relationship with Europe, something that's kind of dropped onto the back burner over the last few months, but will come right back into prominence again, as we get towards the 31st of December, which is when, if no deal is made, the U.K. and the European Union will stop trading with each other at arms length, with tariffs and full border controls.

Anthony Scaramucci (03:48):

And so, I mean, take us back through the history of this. We're going to go back to June of 2016. Prime Minister Cameron decided to have a referendum related to the Brexit. And again, for our American friends on the call, why did Prime Minister Cameron do that? Did he need to do that? Was that part of your parliamentary system where it was necessary? Or is this a voluntary decision that he made alongside of his advisers?

Philip Hammond (04:18):

So it was a political decision. We need to go back a little bit earlier to the general election of 2015, when the Brexit party, which was UKIP, the United Kingdom Independence Party, was making huge gains in the polls. And it looked like Cameron's administration would be turned out at the general election. And David Cameron decided that the only way to try to win that election was to head off UKIP by offering... By basically saying to the people, "You do not need to make this election about whether or not to stay in the European union. If you reelect me, I will give you a referendum on that question."

Philip Hammond (05:03):

And he was confident. I was confident. Most of the ministers around the cabinet table were confident that the British people, if faced with that question, would vote to remain in the European Union for the very simple reason that it's self-evident, to anyone with a smattering of economics, that the U.K.'s prosperity and economic success is very heavily tied to access to European markets. We've been in a close relationship for 45 years, and for better or for worse, much of our industry, much of our financial services, infrastructure in London is built up around serving those European markets, 500 million rich consumers.

Anthony Scaramucci (05:49):

And so the British people vote, and it's an upset more or less? Because I think even people here in the United States, certainly people in the capital markets, thought that it was going to go through. I think we would also point out... I think it was another... Did Scotland have a referendum as well, a year prior or something like that? And that-

Philip Hammond (06:12):

That was previously.

Anthony Scaramucci (06:15):

And that went well, and so there was a little bit of momentum for unity, and so the political decision. But had he not made that decision... I'm going to get to these other questions first, because I think it's elemental to what's going on, on your side of the pond and our side of the pond. I'll tie it together in a second. But had he not made that decision, what do you think would have happened to UKIP? And what do you think... Where do you think we would be right now, in terms of that populist movement in the United Kingdom?

Philip Hammond (06:44):

Well, that's a very interesting question. I'm pretty sure that what would have happened, if David Cameron had not made the commitment to a referendum in the 2015 election, is that we would have lost that election, because UKIP would have split off enough conservative votes to allow the Labour Party to win. And that would have meant a Labour Party under Ed Miliband, brother of David Miliband, who's probably known to some of the people watching this, would have taken over as Prime Minister.

Philip Hammond (07:14):

Now, Ed Miliband is, by my standards and your standards, a left-winger. But he's nowhere near as much of a left-winger as Jeremy Corbyn, who led the Labour Party in the meantime, between 2015 and the end of last year. So we would have had a labour government. That would have undoubtedly been a difficult time for business and for the financial sector in the U.K., but it clearly would not have been fatal. I mean, this would have been a labour government that squeezed business and squeezed the city, but wasn't trying to snuff it out. And I suspect in those circumstances-

Anthony Scaramucci (07:54):

And he was for remain as well? Not to interrupt you, sir. He was for remain?

Philip Hammond (07:57):

Absolutely, absolutely. Yeah, there would have been no question of a referendum. We would have remained in the European union, and we would have... COVID allowing, we would have just had a general election last month, which I expect the Tory party would have been... Win back in power again. The Brexit referendum would never have happened. Jeremy Corbyn leading the Labour Party would never have happened. So it would have been a very different story to tell.

Anthony Scaramucci (08:25):

So why are we Brexiting? You know it's economically not the best thing for the citizens of the United Kingdom. Most citizens now, and correct me if I'm wrong, sort of realize that it's creating a lot of problems. I know there's an immigration issue, and there's a fear-based issue, one that's somewhat xenophobic. But why are we Brexiting? Why don't we have leadership in the United Kingdom? We're going to get to United States in a second, because I want your opinion. That just says, "Okay, look, this is not the right to do. And so as a leader, I'm going to try to move the population towards that decision, versus where they are now."

Philip Hammond (09:04):

The problem, Anthony, goes back some way. The U.K. joined what was then the European economic community in 1973, on the basis of economics, that it was joining a common market. And the British people have never really been signed up. Even those who are enthusiastic for our relationship with Europe have never really been signed up to the idea of political union. European countries are too different, in many people's opinion, for a political union to work. And there's been a lot of resentment in the U.K. at the creeping encroachment by Brussels over our everyday lives, the increasing political union that the E.U. has become. And it was really a reaction to that, a feeling that people wanted to restore sovereignty to our own parliament, make our own decisions, and control our own borders.

Philip Hammond (10:04):

But underlying that undoubtedly, there was also a broader economic malaise born out of the crisis in 2008, nine, where many people, looking back over the last decades, feel that the rich have gotten richer and the poor have stayed put. Many ordinary working people who are not poor, but ordinary working people, feel that they don't see a way forward for themselves. They don't see their prospects and the prospects for their kids in the way they used to, and that the world has become somehow more unfair and biased against them. And I think, both in the U.S. and the U.K., populism has ridden that wave of sentiment that... I guess it was the quantitative easing, the inflation of asset values that that led to, that has upset the traditional balance between the different stratas of society, and created this populist strength.

Anthony Scaramucci (11:07):

And it's very well said, and I just want one more question on the Brexit. And then we're gonna switch to the pandemic, and I'd love to talk to you about some of your views on the macroeconomic situation. I guess the question I have... If I were a middle income person in Great Britain or the United Kingdom, or lower middle income person, am I better off in a Brexit? Or am I better off tied somehow to the European economic union?

Philip Hammond (11:34):

So there is no doubt in my mind... Although this is disputed, but there's no doubt in my mind, having run the U.K. treasury for three years, that you will be better off if we remain closely linked to the European union, closely trade linked. The fact we have actually now already left the European Union, in political terms, doesn't mean that we couldn't continue to have a very close trade relationship, which will salvage most of that advantage. That would mean having to align a lot of our economic regulations, environmental labour market regulations, and so on with the European union. But it's clear that if we were prepared to do that, European Union would be willing to continue to have a free trade area in Europe, which would allow us, for example, to continue to serve as Europe's financial markets from London, in the way that we've done so successfully over the last couple of decades.

Anthony Scaramucci (12:38):

Okay. So at some point, your prediction is that it gets resolved with some kind of deal, and cooler heads prevail? Or Great Britain or United Kingdom will not be part of your... What's your prediction?

Philip Hammond (12:52):

So we're at a tipping point right now, because the U.K. government has made it clear it will not ask for an extension of the current transition period, which comes to an end on 31st December. So absent a deal done over the next six months, we will crash out of the trading arrangement we currently have, and stop trading on WTO terms. That is to say, full arms length with a hard border between the U.K. and the European Union. This, by the way, is particularly tough for Ireland, because nearly everything getting to Ireland, between Ireland and E.U., passes through the U.K., and a full set of tariffs.

Philip Hammond (13:37):

But there is still time to negotiate, probably, an interim agreement, with a fuller and more detailed agreement later. But there will have to be a significant political shift, because at the moment, the position of the U.K. government is that they would like a deal. But they will not concede anything on equivalence of regulation. They insist on retaining complete freedom to regulate how they wish, and they will make no commitment to align with the E.U. E.U.'s position is the exact opposite. Without alignment of regulation, the U.K. can have no preferential access to European markets. So unless somebody gives way there, isn't going to be a deal.

Anthony Scaramucci (14:22):

Okay. Well, I certainly hope there is a deal, Philip, because I think it'll be in the best interest of the of your people.

Anthony Scaramucci (14:30):

I want to shift gears and talk a little bit about the pandemic, and your opinion of your government's response to the pandemic. We both see the per capita incidents and the case risings. Where were we? What did they do right and wrong? And where are we now? And where do you think we're going?

Philip Hammond (14:51):

So there will be a postmortem in time on the way different governments responded to the challenge. I think that the general prevailing thought here is that when the government finally decided to lock down, it probably did it a week or two later than it should have done. And that has caused us some greater level of-

Anthony Scaramucci (15:22):

Why do you think that happened? Why did it take longer? It certainly took longer in the United States, as well. I'm just wondering, from the inside, what do you think was going on to cause the delay in that decision?

Philip Hammond (15:35):

I think there was a genuine concern about shutting... The economic impacts of locking down. We'd seen what had happened in... Italy, in particular, was the example we were all watching. And there was a desperate desire to try and avoid that. And also, a little bit of hubris, frankly. The British people are very used to being told that we have a great healthcare system in the U.K., state-run healthcare system. And frankly, the evidence is probably... That may have been true 60 years ago, when it was first invented, but it slipped behind many of its European comparators now. And there's still a bit of hubris here, people thinking somehow, we've got a better structure. We'll be able to manage this better. And on the evidence we see at the moment, it doesn't look like that was the case at all.

Philip Hammond (16:34):

One of the things that I take away from the differential handling in the U.K. and some of our European neighbors and in the United States is the degree of centralization. This, the U.K., is a very centralized country. Things are decided centrally in London, and they're run from London. Germany, for example, is a very decentralized country. And even in the United States, we saw the president making various announcements and statements. But in the real world, those were not his province. The governors of the States were able to make their own decisions, and some of them clearly made better decisions than others. But the over-centralization of the UK, I think, is going to come under very heavy scrutiny in the period after this epidemic.

Anthony Scaramucci (17:29):

But I think we recognize in a democracy, it was a problem. I also, frankly, think it was a cultural issue for the United Kingdom and the U.S., having not experienced a pandemic in 100 plus years. It seemed like the Asian nations were more prepared than we were culturally. You could just fly to Asia and see the number of people wearing masks prior to this pandemic to get that feeling.

Anthony Scaramucci (17:54):

I want to switch gears to your opinion on the economy. And so our economy's been hit. Your economy's been hit. The global economy is basically in recession as a result of the pandemic. Where do you think we are now? Where do you think the United Kingdom is? And what policies would you recommend to help dig us out of where we are?

Anthony Scaramucci (18:14):

And then the last question tied to all of that, of course, is, are the Europeans and the men and women of the U.K. doing the right thing from a policy perspective? And what about the U.S.? It's a long-winded question, Phillip, I'm sorry. But you get the gist of where I'm going. It's an economic macro question.

Philip Hammond (18:32):

Yeah. I think where we are, as the lockdown is easing across Europe and beyond, the economy is gradually coming back to life. And clearly, some of the demand suppression that has existed will disappear, and that demand will bounce back. But people can't go eat in restaurants and drink in bars if the bars and restaurants are closed. So for the moment, at least in the U.K., the services sector continues to struggle to maintain any reasonable level of output. And of course, all the while, structural damage is being done to the economy. Businesses are failing. Particularly, over-leveraged businesses are struggling with a lack of cash flows, or reduced cash flows over a relatively long period of time.

Philip Hammond (19:31):

So we have in place here, as you do in the U.S., all sorts of government sponsored arrangements to disguise unemployment, by paying people's wages to support businesses with liquidity problems, all of which will have to be unwound over the next six, nine months. And I think domestically, that is going to be a very, very difficult period for politicians in the U.S. I guess it won't happen until after the election is out of the way. Here, we've just had our election, December last year. So there's no obvious point to work to.

Philip Hammond (20:12):

But withdrawing that money, and recognizing that many people, who were told that they were furloughed and their wages were being paid, are actually now going to be redundant, and their wages will not be paid, is going to be a politically very difficult moment. But I think our experience from past recessions is that where structural adjustments are needed in the economy, trying to mask that need and delay the action only makes things worse and recessions deeper. We need to get on. We need to let the businesses that are going to fail, that have to fail, fail. We need to release the resources from them, the labour and the capital. We need to retrain and re-equip labour where necessary. And we need to get those people turned around and back into work as fast as possible. And that would be my recommendation to the U.K. government. Do not try to mask the scale of the problem. Do not try to delay the restructuring of the economy.

Philip Hammond (21:21):

I think the difficulty is that we're going to be doing this against, I suspect, a backdrop of stagnant or even shrinking world trade, which, for an economy like the U.K., which is very, very open to global trade, is going to be a very difficult backdrop.

Anthony Scaramucci (21:41):

I want you to weave into this, some of the racial tension and the racial anxiety, but that both of our nations are feeling. And so you have the combination of people dislocated from work and the issues around race. What are your feelings about that? And what kind of policy initiatives can be put in place to try to calm those things down?

Philip Hammond (22:08):

Yeah. Well, I think the trigger for this outbreak of racial demonstration has been things that happened in the U.S. And from where we sit over here, it does continue to astonish the degree of racial imbalance in policing techniques, and the aggression that is often shown. And not just shown, but captured on video. And that's an issue that I think is... I wouldn't say it's unique to the U.S., of course. But I don't think we have that problem in quite the same way here.

Philip Hammond (22:51):

But what it did, of course, the demonstrations in support, in solidarity with what was going on in the U.S., led to a sort of wider review of race relations here, and a general feeling that many years on from the last time we had this sort of soul searching and decided that we needed to do more, to become a more racially equal society, not enough progress has been made, and more progress needs to be made. And I sympathize with that. I understand that. I think it's the same strand of thinking that informed what I described earlier around the Brexit decision, that people feel that they don't have opportunity, that they can't see the ladder for them and their kids, in the way that perhaps they used to think it would be there. And we need to create that sense of opportunity for all. And there's a big review at institutional level going on here in academic institutions, in businesses, in charitable organizations and schools about the way they manage these things and how they can do better.

Anthony Scaramucci (24:08):

I think it's very well said. Before I turn it over to John and questions from our audience... Last week, we had a professor from Stony Brook University, Stephanie Kelton. She just wrote a bestselling book called The Deficit Myth, Phillip, and she is a modern monetary theorists. And she sort of believes that deficits do matter, but there's a lot of wide latitude that currency-issuing nations, like the United Kingdom and the U.S., have in terms of managing their budgets, and that ultimately, large deficits can be maintained and sustained by places like the United Kingdom and the U.S.

Anthony Scaramucci (24:53):

And what are your thoughts on that? Richard Nixon once said that we're all Keynesians now, Philip. He said that after he took us off the gold standard in 1971. Are we all Keynesians, or all modern monetary theorists, now?

Philip Hammond (25:07):

Well, I spent much of the last three years trying to reduce the size of the U.K. deficit. And we finally got to the point, just before I left office, where our debt was shrinking from a very high level, but shrinking as a share of GDP. And I'm very proud of that. Not because I believe that we should slavishly astrew deficits and reduce debt, but because I think that common sense tells you that in times when the economy is doing relatively well, you shouldn't be running very large deficits, so that in times when the economy runs into trouble, you have the capacity to respond.

Philip Hammond (25:48):

So what my successor has done... One level is disappointing for me. Having got the deficit here down to a mere 24 billion pounds a year, he's now taking it back up to more like 100 billion. But of course, I recognize that that's something he had no choice about. He had to do that in the circumstances, and precisely the reason we were trying to control the deficit was to create that space, should we ever need it. Nobody knew we were going to need it in 2020.

Philip Hammond (26:21):

But I would draw a distinction between the United States and other currency-issuing countries. I mean, the U.K. has the privilege of borrowing in its own currency. And of course, one is in a very different position if one borrows in one's own currency, than if one borrows in U.S. dollars, as a non-dollar area country. And the challenges that some of the emerging markets are facing around their dollar denominated debt is evidence of that.

Philip Hammond (26:54):

But the U.S. has the privilege of knowing that however irritated people, markets might be with U.S. government policies, or even monetary policies, the Fed's monetary policies, in the end, the dollar is the backbone of people's reserve holdings. And that gives the U.S. quite a large amount of leeway, which frankly we in the U.K. do not have. The pound sterling is a minor reserve currency now. The Euro, also a reserve currency, but not on the scale of the U.S. dollar. So I think these things are calibrated to the extent to which third parties are forced to hold your currency, whether they like what you're doing or not.

Anthony Scaramucci (27:47):

Well said. Listen, I read through her whole book. As a conservative and a lifelong Republican, there are issues that I have with the book. Probably, perhaps, you have the same issues. But the flip side is, she said something to me that was very compelling, is that, "Well, we're doing it anyway. The United States is going to issue three or $4 trillion of debt. So spare me the sanctimony about all of this conservatism." And so I thought her discussion and her intellectual gravitas was fascinating, so...

Philip Hammond (28:20):

Yeah, I still remember from the early days of the administration, when they were assuring everybody, including me, that all the stimulus programs were going to be self-financing and wouldn't lead to any increase in the U.S. public bear.

Anthony Scaramucci (28:38):

Right. Well, yeah. I mean, well, okay, well... Anyway, I have a bridge in Brooklyn I can sell you, Philip, if you can ever get back over here to this side of the pond.

Anthony Scaramucci (28:46):

Let's switch it over to John Darsie, John Duckless Darcy, without the little mallard duck behind him. Go ahead, John. I'm sure you've got some questions here-

John Darsie (28:58):

Well, speaking of the duck, I need to start with a comment that was submitted to the chat by Bill. He said, "For what it's worth, I liked the duck. But you should always agree with your mother-in-law." So I just want to have that on the record, that the duck might be making a return for our future SALT Talks.

John Darsie (29:12):

But the first question that we got from the audience is, "You touched a little bit on global trade, and how you think the pandemic is going to affect it, as it relates to the U.K. But generally, do you see any significant, longterm shifts in the way we look at supply chains and global trade as a result of the COVID-19 pandemic?"

Philip Hammond (29:30):

Yes, I'm sure that everybody will want to look at resilience of supply chains, and that's obviously a sensible thing to do. There's clearly attention between efficiency, getting the lowest cost, and resilience, having the greatest security. And I think there are a lot of people out there who will be thinking that we got the balance wrong, that we were driving efficiency at the expense of resilience too far, and that we need to build more resilience into supply chains in the recovery.

Philip Hammond (30:05):

But there are also a lot of people who are going to try and use that argument to make populist driven, protectionist solutions. And we have to resist those. This is not a moment to dismantle global supply chains. It's a moment to try and reinforce the resilience of them. There are many ways that can be done, and I think we should be engaged at an international level, perhaps through the G20, in discussing how we can beef up the resilience of supply chains without dismantling the globalization agenda, which has so increased living standards around the world.

John Darsie (30:47):

The next question is in regards to the U.K. government's response to the pandemic. "If you were still the chancellor of the Exchequer, what would you be doing differently than your successor, Rishi Sunak?"

Philip Hammond (31:02):

Okay. I don't want to criticize Rishi at all, because obviously he's facing some very, very difficult challenges. If I just tell you the areas where I am perhaps a little uncomfortable... I am nervous about having extended the government financed furloughing of employees through to the end of October. I personally think we should have tried to wean ourselves off that a little earlier. I think we are disguising some unemployment there, which we know is going to come through. And this is not necessarily good for the economy, to continue to disguise that.

Philip Hammond (31:43):

I think we have to take a sectoral approach. The British government, the Treasury rightly hates having to take a sectoral approach, but it's so obvious that this pandemic is affecting some sectors much more than others, that we inevitably will need to deal with aviation, hospitality in a different way, from the support we give to manufacturing, for example, often actual services. So I think over the next month or so, Rishi Sunak needs to start spelling out what the recovery path is going to look like, including the tough measures. So far, it's all been about additional support to the economy. But he needs to be explicit that these measures will have to be time limited, and we will have to face up to the real consequences of this crisis, in terms of higher unemployment, lower output.

John Darsie (32:43):

The next question has to do with the negotiations between the U.K. and the E.U. "What timeframe do you see a deal eventually occurring? And when that deal comes to fruition, do you see a devaluation of the British pound on the horizon?"

Philip Hammond (32:59):

Well, there are two scenarios here. Either we reach a deal by the end of this year... But if we do, I would expect that to be a very light touch framework deal, that probably won't be ideal from the point of view of either parties, but will be acceptable as a temporary arrangement, following which there will be a longer term negotiation of a more comprehensive agreement. Or we fail to reach deal during the course of 2020 because of the political challenges around that, in which case we would leave with no deal in December 2020. And there will be a period of time before the parties get back to the table, as I'm sure they eventually would, to negotiate a future deal.

Philip Hammond (33:50):

Now clearly, from where Sterling is at the moment, I guess quite a lot of the potential for no deal is already baked in there. So if a deal were announced, if a deal were done, I would expect that to be positive for Sterling. If it becomes clear later in the year that the deal won't be done, I would expect there is some element of no deal that isn't yet discounted in the price of Sterling. And so I would expect to see a negative movement, if that becomes the most likely outcome.

John Darsie (34:26):

"You've talked a lot about the need for a global digital services tax. Please explain what that means, and why you think it's something that the world really needs."

Philip Hammond (34:37):

So for many, many years, for the last 100 or so years, we've taxed international businesses on the basis of physical presence. So when Ford Motor Company came to the U.K., they built factories here. They built dealerships. They had a physical presence which could be taxed in the U.K. But increasingly, in the digital economy, the services that generate huge amounts of value do not require a physical presence in the marketplace country. And therefore, the taxing authorities in those countries have nothing that they can levy attacks on. And increasingly, they see digital business being done from tax-haven countries into their own jurisdictions, and the taxable earnings from that business leaking away.

Philip Hammond (35:33):

So for example, in the U.K., most of the big digital companies do deliver their business in the U.K. via the Republic of Ireland, which has a very favorable tax regime. They have no physical presence in the U.K. to support that business. That is clearly not a sustainable model for the future, as more and more business becomes dominated by digital content. And we have to find a better way of taxing international businesses that don't have a physical presence in the marketplace.

Philip Hammond (36:10):

And pretty much, the world is agreed on a solution, with the exception of the United States. And the United States takes the view that because, at the moment, many of these digital companies are U.S. companies, that this digital tax initiative is discriminatory against U.S. companies. And the U.S. is holding out. Personally, I think that's a rather shortsighted view. I suspect we're going to see, over the next decade or so, more and more of the key digital players being domiciled outside of the traditional developed countries, and more and more of them coming from Asia. And I think we do have to tackle this problem. And ultimately, it will be as much of a problem for the U.S. as it is for the Europeans now.

John Darsie (37:05):

"You touched on Asia a little bit. What is the relationship right now between the U.K. and China? And as tensions continue to rise between the United States and China, how does the U.K. fit into that? And what type of stance they take in relation to the U.S.-China relationship?"

Philip Hammond (37:21):

Very good question. So the U.S.-China relationship, and the difficulties with it, are a real challenge for the European countries in particular. Nobody in Europe wants to be stuck, forced to choose sides between the world's largest economy and the world's second largest economy. In the case of the U.K., we have a very open trading economy. We need to have good trading relationships with both the U.S. and China, although there will never be any doubt where our strategic partnership is. We've been strategic allies of the U.S. for... Well, certainly since the Second World War, and that isn't going to change. Nothing is going to change it. But in terms of trade, we have an important trade with China, as well as a very important trade with the U.S.

Philip Hammond (38:14):

So that tension between the U.S. and China is spilling over and challenging the Europeans, who are increasingly being asked by both the Chinese and the Americans to take sides, to choose whether they're for or against one or the other on a particular issue. And we've seen this most graphically in relation to Huawei.

Philip Hammond (38:39):

The U.K. relationship with China is further complicated by the U.K.'s particular position with regard to Hong Kong. And as the former colonial power in Hong Kong, we have certain obligations and certain rights under the agreement that we made with China back in 1994, which survive right away through until 2049. So we have a specialist interest in Hong Kong. We have millions of people with British passports living in Hong Kong, Hong Kong citizens. And therefore, the tension in Hong Kong is another source of friction between the U.K. and China. And in my time in government, we were very careful to try to balance our relationship with China, and to try to manage these difficulties and differences. The current administration under Boris Johnson is very keen to be close to the Trump administration, and to my mind, that has encouraged them to move decisively to the U.S. side of this argument, and to be prepared to take bigger risks in the U.K.-China relationship.

Philip Hammond (40:00):

That's where I think we are now. Quite a difficult period.

John Darsie (40:04):

Well, Chancellor Hammond, I want to thank you for all your very thoughtful answers, and for joining us today on SALT Talks. Anthony and I were in London in early February. We got to see you. The world's a little bit of a different place since we saw you in February, but we're hopeful that soon, we'll be able to get back to the U.K. and get to see you as the world opens up a bit.

John Darsie (40:23):

So Anthony, do you have any final thoughts before we let Chancellor Hammond go?

Anthony Scaramucci (40:26):

I wish you great health, sir. And I hope I can get you here to North America for one of our SALT conferences which, hopefully, John and I are looking forward to starting again. We'll have more information out about that once we can figure out and allay everybody's health concerns.

Anthony Scaramucci (40:42):

But Chancellor Hammond, thank you so much. And hopefully we'll see you soon.

Philip Hammond (40:47):

Thank you. Look forward to it.

Valerie Jarrett: Advising President Obama, Social Unrest & Life After Office | SALT Talks #7

“Racial equity starts with equal education for every young child. Policies around inclusion are incredibly important in order to create opportunity in education and the workplace.”

Valerie Jarrett, Senior Advisor to The Obama Foundation and Director, Office of Public Engagement and Intergovernmental Affairs under the Obama Administration, joined us after the murder of George Floyd to discuss racial unrest in the United States.

“Every Black family has conversations and lessons with their sons about how to deal with police when they encounter them.” Interactions with the police serve as a microcosm for race relations in America, where Valerie thinks we’ve reached an inflection point in what we will and will not tolerate.

Turning to the 2020 election, Valerie voiced her support for the presumptive Democratic nominee. “No one understands Vice President Biden’s qualifications and capabilities better than President Obama.”

LISTEN AND SUBSCRIBE

SPEAKER

Headshot+-+Jarrett,+Valerie+-+Cropped.jpeg

Valerie Jarrett

Senior Advisor

The Obama Foundation

MODERATOR

Headshot+-+Scaramucci%2C+Anthony.jpeg

Anthony Scaramucci

Founder & Managing Partner

SkyBridge

EPISODE TRANSCRIPT

John Darsie (00:07):

Welcome back to SALT Talks everyone. Thanks for joining us again today. We've got a great response to the first few SALT Talks. And we're really excited about the lineup that we have coming over the next month. And we're really excited about the guests we have today as well as tomorrow. SALT, as many of you know, is a thought leadership platform and networking forum. We have an annual conference that we do every year in Las Vegas, as well as international conferences that we've had in Abu Dhabi, Singapore and Tokyo. And we look forward to resuming those conferences in person, hopefully in 2021. But in the meantime, we're having a lot of fun doing these SALT Talks.

John Darsie (00:41):

SALT Talks are a series of digital interviews with leading thinkers and innovators across finance technology, and geopolitics. And today we're very excited to have a senior member of the Obama administration joining us, Valerie Jarrett. Valerie is a distinguished senior fellow at the University of Chicago Law School. She previously served as a senior advisor to President Obama and the Assistant to the President for public engagement and Intergovernmental Affairs during his entire tenure from 2009 to 2017. The office that she occupied was actually the position that Anthony was going to occupy in the White House prior to some shenanigans, which he and Valerie can get into during the talk.

John Darsie (01:23):

She also managed the Office of Urban Affairs and served as the co-chair of the Obama-Biden transition project. She's the author of a fantastic book that came out in April 2019 called Finding My Voice, and I've got to get the new tagline right here, Finding My Voice: When the Plan Crumbles, the Real Adventure Begins. And you can order the book online at valeriejarrettbook.com. And we highly recommend you do that, especially in this moment. There's so many relevant topics that she covers in that book. Valerie be interviewed today by Anthony Scaramucci, the founder and managing partner of SkyBridge Capital as well as the chairman of SALT. And if you have any questions during the talk, just post them to the Q&A section at the bottom of your screen, on the Zoom link, and we will get to those during the course of the interview. And I'll throw it over to Anthony and Valerie.

Anthony Scaramucci (02:17):

Well, first of all, John, thank you, Valerie, great to have you with us.

Valerie Jarrett (02:22):

Thank you.

Anthony Scaramucci (02:22):

I want to personally give a shout out and thank Robert Wolf for introducing us a few years ago. I had the great honor of visiting you in the White House when you were working with the Obama administration. And then you came to SALT a couple of years back while you were a White House official, which really was an amazing part of our story. And I appreciate you being a friend of SALT and so forth. But I want to start out with the book because I think you have a fascinating life story in terms of where you were born, where you were raised, how you developed your relationship with the president and the first lady. And unlike me who only lasted 11 days, you lasted the entire administration. And we both know that Washington is a rough town. So I want to talk a little bit about that. Let's start at the way beginning, if you don't mind. Tell us a little bit about yourself for people that don't know you Val.

Valerie Jarrett (03:17):

Sure. Well, as you mentioned, I was born in Shiraz, Iran, during the mid '50s, at a time when the United States and Iran had very strong diplomatic ties. My dad was born in Washington, my mom, Chicago, and they ended up in Iran, because when my father finished his service in the military, he was a physician, he could not find a job comparable to his white counterparts at major academic institutions around this country. And that's what he wanted to do, was research.

Valerie Jarrett (03:47):

And so they explored other alternatives and landed this job starting a new hospital and chairing the Department of Pathology, in Iran, the Nemazee Hospital. I was the second baby, Anthony, born in that hospital. They practiced on some other poor baby first. And then we lived there until I was five. From there we moved to London and from London, my father landed a job at the University of Chicago Medical Center in the neighborhood where my grandmother and extended family all lived.

Valerie Jarrett (04:15):

And growing up one of the important lessons he taught me is that sometimes the shortest distance to where you really want to go means you have to be prepared to take the long way around. And so his long way around took them halfway around the world, and it really was an important sense of being flexible, being willing to look at perspectives outside the envelope to see where your real possibilities might lie.

Valerie Jarrett (04:40):

And so I was fortunate to have Barbara and Jimmy Bowman as my parents and a huge extended family since I'm an only child gave me great love, unconditional love, more support than I could ever ask for, and set really high expectations of not what I would do, but who I would be. And the sense that to those who much is given, much as expected. And instilled in me this really strong work ethic, which has served me well.

Anthony Scaramucci (05:11):

So you meet Michelle Obama first. She's your first-

Valerie Jarrett (05:15):

Michelle Robinson. Michelle LaVaughn Robinson.

Anthony Scaramucci (05:17):

Michelle. I'm sorry. Excuse, I don't know... Michelle Robinson, I'm sorry, yeah. That's the first lady's maiden name. So tell us a little bit about that. So that's your-

Valerie Jarrett (05:28):

Yeah. We'll be 30 years next summer. So in the summer of 1991, I was mayor Daley's deputy chief of staff. I practiced law for 10 years. Six years in the private sector for the Corporation Council for the city. He had just promoted me to deputy chief of staff and I was trying to recruit people to come and join the office and a friend of mine who was the number two person in the law department sent me her resume, Susan Sherwood across the top, brilliant young lawyer. Please interview her I think you'll be impressed. She doesn't want to practice law at a big law firm anymore. And that was music to my ears, because I had hated the practice of law in a big law firm.

Valerie Jarrett (06:07):

And I still remember her walk into my office, Anthony, shook my hand, had her hair pulled back like I do, only mine is because I haven't been able to get a haircut and commanding presence for a... She was in her mid 20s. 27 year old, kid basically. And what I remember most is she told me her story. And we all now know it as a quintessential American story. Growing up on the south side, working class family, parents who didn't go to college but instilled in her and her brother, this similar value to my parents, that you got to get out there and work hard and do something purposeful with your life. And her dad, and her best friend, she shared with me, had died within the last year. Suddenly, both of them. Her father had been sick for a long time, but they weren't expecting his death, and her friend, who had been her roommate in college-

Anthony Scaramucci (06:57):

I remember that from her book. Yeah, she wrote that so great book.

Valerie Jarrett (07:00):

Yeah. And she said it was just a wake up call to, am I leading that purposeful life that I was raised to lead? And could I explore public service as a way of giving back to a city that I love? And so we clicked, I offered her job on the spot, she wisely said, "Let me think about it." Talked it over the fiance, he thought it was a bad idea. And so when I called to say, "What do you think?" She said, "Well, I got this problem." And I'm like, "Well, who's your fiance? And why do we care what he thinks? What do you want to do?" And so she laughed, and she said, "You got to meet this guy. Would you have dinner with us? And let's talk it through." And that's what we did. And the rest as you might say is history.

Anthony Scaramucci (07:40):

And so now your relationship is continuous. It goes on. Then, young, senator Obama, he becomes a senator in 2006. He wants to run for president. Talk a little bit about that because I think it's also an interesting part of the conversation about his decision to run for president and your advice to him.

Valerie Jarrett (08:04):

Well, I learned my lesson when he was considering running for the Senate. I thought it was not prudent. He'd just lost the congressional race. And I thought, "Well, if you can't win our district," we live a block apart in Chicago, and we know the neighborhood well. And I was like, "Well, you can't win here. How are you going to win statewide?" Illinois, is in a sense a microcosm of the country. You have Chicago is a big city, but you've got farmland and rural communities. And he's like, "Oh, I've been going down state since I was first elected. And whenever I go down, I get headlines because usually state senators from Chicago don't venture into farm country. And I understand their issues, and I care about them. And I think they know that." And Mrs. Obama said, "Let's have a brunch at your home and talk him out of this." Because she also had had about enough of politics.

Valerie Jarrett (08:51):

And by the end of the brunch, he'd convinced us not only should he do it, but I should chair his finance committee for his Senate race when we said, "Well, how are you going to raise any money?" And he's like, "You are." So when he decided to run for president, I think... Well, I actually think after the convention speech in 2004, I saw his ability to connect broadly around the country with this message of, no red states and blue states, it's just the United States. And I thought he had what it took.

Valerie Jarrett (09:19):

And now my parents didn't. My parents thought he'd lost his mind. And again, remember, they grew up during Jim Crow experience, racism and discrimination firsthand. Did not think in their lifetime that there would ever be a black man elected president. My father who grew up in DC, had never set foot in the White House, even on a tour until I worked there. So this was really the difference in generations, whereas my daughter was like, "Well, of course he could win. Why wouldn't he win?" So it just shows you in three generations what a difference it was.

Valerie Jarrett (09:51):

But I felt like they had raised me to believe, he worked hard and he had to go that anything is possible. And after he was elected, my mom, said, "How did you even know he could win?" Not that he would, but Anthony, even that he could win. And I reminded her of how she'd raised me. You know what she said? "Well, I never really believed that." And I realized, "Oh, my gosh," they raised me aspirationally not as reality that they knew, but for me to develop my own. And so-

Anthony Scaramucci (10:18):

Well, I had that identity. I can totally identify with that. My parents did that with us. My dad was a blue collar worker, you and I've talked about that.

Valerie Jarrett (10:26):

Sure.

Anthony Scaramucci (10:26):

And you had to sit at his dinner table at 5:15 in the afternoon, and you had to do your homework and you were going places. He used to drive us into the wealthy areas of the town. He said, "You're going to live in one of those houses someday." And we actually believed it. So if he could [crosstalk 00:10:41].

Valerie Jarrett (10:41):

Yeah. Well, he believed it or not you believed it.

Anthony Scaramucci (10:43):

Exactly. I bought into the whole thing but that was one of the things that... And we've talked about this because something has gone wrong. Because my father was in an aspirational blue collar family. I'm sure your parents, your dad was more educated, but they had these aspirations for their children. When I was campaigning for president Trump and going into certain areas, and I'm sure you experienced this during president Obama's campaign, you felt a sense of desperation. That the economic aspirations of a blue collar family were becoming economically desperation.

Anthony Scaramucci (11:19):

So it's a good juxtaposition to where we are right now. Because we have the race component overlaid on it. And I'm interested to get your reaction to this, this is my opinion. I want to get your reaction to this. It's always been there, Valerie, it's always been systemic in our society. But there's been a very large group of people, white people that have either not necessarily ignored it but have not taken it to full credence. It now seems that we're at a boiling point societally, where people are like, "Okay, we have to get ahold of this thing. We have to figure it out." You were addressing some of this, this morning on Morning Joe. And I was just wondering if you could take us there, what your thoughts are related to it.

Valerie Jarrett (12:07):

Sure. So I think you're right, Anthony, our country has a deep and painful history of racism and discrimination going back to slavery, where I talked about my parents growing up in the Jim Crow era where they couldn't go to certain restaurants, couldn't go to the movies, couldn't stay at certain hotels, had to worry about lynching, particularly in the south, obviously. Went through the Civil Rights movement, saw great strides in terms of protections that were put in place in the Voting Rights Act and the Civil Rights Act. And you began to feel that perhaps we were making some progress and we have. I mean, my goodness, I don't think we should say that we haven't made a great deal of progress. But I do believe that part of, as you described it boiling over, I am hoping it's more of an inflection point, and now a turning point is that all of the cumulative effect of that has had a painful, frustrating, exhausting impact in the black community.

Valerie Jarrett (13:10):

And I think for the rest of our country, those who do not feel that they are discriminatory or racist, have been free to ignore what as a black person you can't ignore. Every black family I know, and I'm not being hyperbolic, every black family I know, regardless of their income, or station in life, gives their black sons a lecture over and over and over again, about how to comport themselves with the police. And the police are a microcosm of a societal problem. The difference is that they take an oath of office and are given a badge and a gun.

Valerie Jarrett (13:46):

And it's also a microcosm of the challenge we have within our overall criminal justice system, which president Obama described after the death of Trayvon Martin. He said, "If I had a son, he'd look like me, and we have to do some soul searching to figure out what why that is so scary to people. Why every black boy and black girl can't have the same trajectory as everyone else." And so I think we have been on this continuum. Certainly during president Obama's time in office, we had Michael Brown, we had Eric Garner, Tamir Rice, Laquan McDonald in my own hometown. And so it has been building for a long time.

Valerie Jarrett (14:23):

And then you bring to this current climate and I do believe that the president, president Trump has as opposed to brought us together, or deescalated tensions, has actually polarized us. And then you overlay on top of that social media and everybody getting information on-demand. It makes it easy to retreat to your comfort zone and not have to talk to people who you might disagree with and try to find some common ground. Then you add a global pandemic, which has had such a disproportionate impact on communities of color, particularly the black community. Health disparities have been laid bare, income disparities, fragility in terms of benefits at work, whether people have insurance or paid sick days or paid leave.

Valerie Jarrett (15:08):

And then we all watch on television, a man die in slow motion, and his death, and I should pause to say his service today is in Minnesota and his family, my heart goes out to him. But then his six year old daughter yesterday said, "My daddy changed the world." And I sure hope she's right. Because the nonchalantness with which those officers killed him, is what's stunning. And they saw the cameras. They knew they were being videotaped. So where are we where police who are sworn to serve and protect can behave in that way in this great country in 2020?

Valerie Jarrett (15:48):

And I think all of that coming together, is what has caused demonstrations, the vast majority, are being peaceful in all 50 states and in fact around the world. Because people look to us as that beacon of hope. And at the same time you have president Trump sending in law enforcement to physically remove peaceful demonstrators using tear gas and rubber bullets. Why? Why? So that he can walk and stand in front of a church that he had not been inside of since Inauguration Day, and hold up a Bible and try to use the church and a Bible as a prop, which has received not only criticism from the church, but also now for the first time in my lifetime that I can remember, from the military leaders who always hold themselves above politics. So all that has come to a head. And the question is, where do we go from here?

Anthony Scaramucci (16:47):

So I want to ask you this question, it's a little bit of a pointed question, but I'm curious to get your reaction to it. There is a commentator on CNN by the name of Van Jones, we both know him personally. The evening of president Trump's election, he said it was a white lash. I don't know if you heard him say that.

Valerie Jarrett (17:10):

I remember. I remember it very well.

Anthony Scaramucci (17:11):

And I didn't get it at the time. I have to totally confess that obviously I was pro Trump at that time, I was trying to help the president, I saw that blue collar despair in those white communities, frankly, a community I grew up in. I mean, we had blacks and whites in our community, but it was a blue collar community. And I'm just wondering, is that over? Meaning, are we at that inflection point that you're describing? Assuming that Van Jones was correct in 2016, you could tell me if he was or he wasn't, but assuming that he was, are we at an inflection point now, where we can move this society to a post racial society meaning where your skin color, my skin color, is going to be irrelevant? Are we there or is the stereotype so hard in the society, that we're not there? And then if we're not there, what is it going to take to get there?

Valerie Jarrett (18:11):

Well, let me say a few things on there. First of all, I think that what we saw with the economic crisis in 2008, coupled with the advances that technology have brought to efficiency and needing fewer people in the workforce to do the same jobs, do different jobs with higher requirements of training, that you're right, for the first time, many white Americans wondered, would their children have a better opportunity than they had had? And that was a first for them. And in a sense, they were experiencing what the black community has worried about all along. And now that it was a crisis with them, the question is, well, whose fault is it and what do you do about it?

Valerie Jarrett (18:54):

But in terms of the backlash, I think we should also remember that our elections in our country have always been close. President Trump lost by three million in the popular vote. He lost in three states by fewer than 100,000 votes. So it was a very close election. And 100 million eligible voters did not vote. And that is really where I've been focusing my energies. Is what can we do to get people who have looked at Washington or even their local elections and decided, "This isn't relevant to my life."? Or, "They're all bums. I don't like any of them." Or, "What does one vote count?"

Valerie Jarrett (19:34):

And I hope that over the last three and a half years, we've had a real civics lesson. That elections at all levels really do have consequences. It's one of the reasons why Michelle Obama and I started an organization called When We All Vote. Michelle is a founding member of it, we've been able to bring in lots of coaches. It's non-partisan. And she wanted to do a non-partisan initiative about voting. It's called When We All Vote because we think our country is stronger when all Americans vote. And we've been working really hard over the last couple of years since it was launched in 2018, to focus on not just who's president of the United States, albeit important. It matters who's in your local. Who's your mayor? Who's on the city council electing or appointing police chiefs? Who are the prosecutors making decisions about who to bring cases about? Who are the judges sitting in judgment and affecting our lives? Who are in the state legislatures drawing districting lines and appropriating funds? And certainly who's the check of balance in Congress?

Valerie Jarrett (20:32):

And then if we can raise the awareness and make people see the nexus between their lives and voting, then we'll have a stronger democracy regardless of which party actually wins. And better accountability in our senate. Because what I've observed, and I'm curious, Anthony about what you think about this, is that president Trump seems to be really focusing his energies and his message on a relatively small part of our country, assuming if he can get them very excited, that that is energy will result in turnout. And that if everybody else is apathetic, then he wins. Without actually getting the majority of the American people to be supporters.

Anthony Scaramucci (21:10):

Well, there's no question about that. I mean, I'll add evidence to that. The last time I talked to the president was Easter Sunday of 2019. He was sore at me, because I had written an op-ed, that the press is not the enemy of the people. You can find it on hill.com, just expressing the understanding of the Constitution, the institution of it, and the need for the press, not only to hold people in power accountable, but the press does something else for our society, which you and I have talked about, if we can teach our second grade children to speak and think freely, they go on and become great economic innovators. They invent Facebook and Google and all these other great companies. If you don't teach them to speak freely, like in China, well then what happens is you're narrowing the band of their creativity.

Anthony Scaramucci (22:00):

And so he got very sore at me. I said to him, "Well, what about the independence and the moderates?" And he said something which was very telling. He says, "No, no, I'm worried about the base. Let me work on the base, everything else will take care of itself." And to your point is, he's making the bet that the vote will be down, and the base vote will be up. And it's also something that concerns him. Because he said it repeatedly and general Kelly and I, we're going to be with general Kelly tomorrow on a SALT Talk. General Kelly and I have talked about this, the president really believes rightly or wrongly, that if that base turns out in a magnificent way, to use one of his words, he'll win the presidency.

Valerie Jarrett (22:43):

Well, of course [crosstalk 00:22:43].

Anthony Scaramucci (22:44):

Irrespective of the popular vote or all that other stuff. So everything he's doing on Twitter, that walk across Lafayette Park, that is designed for the base. That photo op, I mean, holding the Bible. I mean, my wife said something funny, I probably shouldn't say it, but we're on live and she was like, it was almost like a soiled diaper the way he was holding it. I mean, he wasn't holding the Bible like somebody at any level of general familiarity with the Bible. So I mean, look, it is what it is. We're here now.

Anthony Scaramucci (23:16):

But I guess my question, though is, Robert Kennedy got it right. He said in 1968, that there would be an African American man as president. That he saw that inside of 40 years, there was a possibility that an African American man would be president. And Barack Obama was sworn in 40 years to the day from that statement. I guess what I'm asking is, can we move the society again? Can we move it where we can become from a policy and a stereotyping point of view post racial? And I'll say one thing too, that I know you'll get, my first year Harvard Law School two African American kids were picked up walking to the convenience store. They were in my class. 30 years later, professor Gates is with you and president Obama having a beer with the cops that did that 30 years late. So it's clear that it didn't happen in my adult lifetime. But can it happen in my children's lifetime?

Valerie Jarrett (24:16):

Yes. Now, post racial is a big word. Will we be able to eradicate all racism in our country in our lifetime?

Anthony Scaramucci (24:23):

No. Of course not. No, no, of course not.

Valerie Jarrett (24:25):

But can we develop this sense of empathy for one another? And in a sense, that's what this crisis point shows. When you have crowds all over the country that are not just black people marching, but they're white people and Latino people and Native American people, young people, old people, people of all walks of life, around our country have resoundingly expressed not just in their physical presence on the street, we're let's face it, in the middle of a pandemic. They're taking a chance with their life. And so they feel so strongly there, that they're willing to go out there and notwithstanding the fact that our experts tell us it's not safe.

Valerie Jarrett (25:07):

But we also, I think, when you add to that, which gives me some hope, is that we're seeing action on the ground. And so there are two issues here. One is racism. And that's within our own hearts. And we've got to work that through. And I think some of it is generational, and it's young people talking to their parents and talking to their grandparents. I had this conversation with my mother this morning. She said she was very influenced by my daughter. And that we shouldn't think that older people can't change, they can't learn and can't grow. So I think that that is happening.

Valerie Jarrett (25:40):

But the other thing that is so important, and this is a piece of what president Obama was talking about in his town hall yesterday, is that we have a right to expect that government's role is to ensure that there is justice and that it is using whatever levers it has at its disposal to try to make sure that even if people don't feel a certain way, that they behave a certain way.

Valerie Jarrett (26:05):

And so I can't tell you what's in your heart, but I can insist that you treat me with respect. And when we talk just about the police, for example, yesterday, president Obama asked mayors to make a pledge that they'll work with their communities within the next 60 to 90 days at the use of force. This is a hot button item for many people of color. And it was one of the recommendations in the task force report that he presented when he was in office. And gave to all of local law enforcement because we have something like 18,000 local law enforcement agencies in the country, and they're the ones that make the decisions about how the law is meted out.

Valerie Jarrett (26:46):

Well, I called a group of mayors yesterday whose texts numbers I had, just to see if before president Obama's remarks we could get some to commit. So I called the mayors of San Francisco, LA, Minneapolis, Chicago, DC, Atlanta and New York. All of them, literally just like that said, "Of course we'll do that." A few of them were already going through that exercise. Mayor of San Francisco, London Breed, is right in the midst of implementing the taskforce report. So I say this to say you expect the government to ensure that if we are about law and order, as president Trump said yesterday, that it has to be fairly meted out. That there has to be equal justice. That there has to be transparency and accountability.

Valerie Jarrett (27:27):

And so if the police departments around the country can start to take those necessary steps, then at least we can control the behavior. And I would also add that this Justice Department has been missing in action. When Michael Brown was murdered in Ferguson. And we had demonstrations as a result of that, president Obama sent Eric Holder to Ferguson to meet with the police department, with the advocates, with the family of Michael Brown, with the faith community and say, "What is going on here?" And it triggered a pattern and practice investigation which the Justice Department can do, which is an enormous stick to hold over local law enforcement agencies. It's the best stick that they have. And guess what they found in Ferguson? A pattern of practice.

Valerie Jarrett (28:15):

And so then they can get a judge involved and enter into a consent decree. And so all of this is to say, our government, even if our culture isn't there yet, we need to have a justice system that protects against the discrimination that comes from racism. And I think that this younger generation, just as we've seen with LGBTQ rights, where we've seen a revolution in thought over less than 10 years, I think that this has really been a wake up call. You saw yesterday, businesses announcing, we've got to look at our diversity and inclusion policies. We've got to see what is our role in being complicit in this. It's not enough to just be quiet. People have to speak up and they have to change their behavior. And I think by doing that, it will also change hearts.

Anthony Scaramucci (29:05):

Well, I certainly hope so. And I do appreciate the sentiment. Before we turn it over to outside questions, I want to talk a little bit about the campaign, November 2020. What do you see president Obama's role, first lady Obama, yourself? If you had to gauge the activity of the president and the first lady, where do you see it?

Valerie Jarrett (29:34):

Well, look, I think, as president Obama said, when he endorsed vice president Biden a few weeks ago, he's all in. He's going to do everything within his power, as am I to help vice president Biden. And look, nobody knows vice president Biden in terms of his qualifications for this than president Obama because he worked with him each and every day for eight years, as did I. So I think we both think he has the track record, experience, empathy. This is a man who grew up in a working class family, whose father had to move to get a job. They were in tough economic strain, and he's had more personal loss than any one human being should have to have. And rather than it making him bitter, and pulling back, it actually has made him incredibly empathetic.

Valerie Jarrett (30:20):

Just one little story about Joe is when my dad died, we were in the administration. And his assistant called up and said, "Vice president Biden's on his way to your office." And I said, "My office?" My office was on the second floor. I'm like, "I'll come down." She says, "No, no, he's coming to you." And he came in, he closed the door. He sat me down and he said, "Valerie, I promise you that when you think of your dad, that the tears that you have today will turn to smiles. Just give it time." And we hugged. I mean, I cried, he cried. We talked about his losses and mine.

Valerie Jarrett (30:52):

That empathy, and it turned out he was right. I now smile. I'm bursting in tears every time I think about my dad. And the empathy that I know he has, and that he's able to convey with complete authenticity, because he's been there, I think our country hungers for that right now. So the question will be, in this environment where you can't go and campaign, you can't knock on doors. You can't do the conventional things. We don't even know if we'll have conventions coming up this summer, what do you do? And I think we have to get creative.

Valerie Jarrett (31:21):

And we'll be using the internet and all kinds of things. So I think we're all in, we're going to do everything we can. I think he has a great message. I think it's terrific. He's going to have a woman as a running mate that sends an enormous signal to half our population, how important he thinks it is to break that barrier. But it will, as I said earlier, it's going to rest on turnout. It's going to rest on people, and part of why we're pushing early vote where there's no evidence whatsoever of vote fraud, part of why we're pushing early, not just early vote, but also vote by mail. Again, no evidence of vote fraud. And also vote by mail, no evidence that it leans into favor of either political party is to make it easier for people to vote when they shouldn't have to choose between their health, and exercising their-

Anthony Scaramucci (32:07):

No, well, I mean, look, it's very obvious to me, the president is saying all that stuff because he wants to suppress the vote. He's figured out exactly what you know, suppress the vote, turnout he's base, that's his pathway to reelection. But with that, I'm going to turn it over to John Darsie. He's got some questions from-

Valerie Jarrett (32:27):

Great.

Anthony Scaramucci (32:28):

... our audience. So one of our audience members texted me. He said, "Well, it was not tear gas. It was smoke canisters." And so he said, "This is what's going on in our society now." It really doesn't matter whether it was tear gas or smoke canisters, you're-

Valerie Jarrett (32:46):

Well, you know what? [crosstalk 00:32:46].

Anthony Scaramucci (32:48):

... clearing innocent people from Lafayette Park-

Valerie Jarrett (32:50):

Exactly.

Anthony Scaramucci (32:50):

... so that a guy can stand with a Bible in front of a church where the bishop inside the church actually doesn't want him there. And you're disrupting, what general Mattis said, the classic, most important right in our society to freely express our values and who we were. And you have foreign film, Australian film, British film, European film, where that park was very peaceful at 6:30 PM. So anyway, that's where we are now though. We're going to debate tear gas versus smoke canisters because we got a certain-

Valerie Jarrett (33:29):

Let me push back to say-

Anthony Scaramucci (33:30):

And by the way, when I get off this thing I'm calling him to yell at him. This is a young guy who I genuinely like. Okay. But let's turn it over to John Darsie.

Valerie Jarrett (33:40):

Well, as we're turning it over, let's just say, and I heard this yesterday, if you look up the definition of tear gas, it includes smoke canisters, and when you saw people out there, whose eyes were burning and who were throwing up in the streets and who had been exercising, as general Mattis said that constitutional right, the question is, is that what we should be doing? Is that what we should be expecting from leaders?

Anthony Scaramucci (34:03):

We had to allay the president's insecurities about being stuck in that bunker. And so that that was the big deal. So all right, let's turn it over to John Darsie.

Valerie Jarrett (34:12):

Hey, John.

John Darsie (34:13):

Yeah, when we talk about systemic racism, police brutality is only one piece of the puzzle. And there's been a lot of talk about economically how we empower young African Americans and people of color in the United States. What type of New Deal economically do you envision for black America? Robert Johnson, the founder of BET, recently came out calling for 14 trillion in reparations. What do we need to do from an education perspective, from an economic perspective, to just close the opportunity gap? The opportunity and equality that exists in America?

Valerie Jarrett (34:45):

Well, sure. Well, it starts with a equal education for every young child. Part of what president Obama's focusing on with his initiative, My Brother's Keeper, is what can we do to keep our young boys and men of color outside of the justice system to begin with? And that is to put their life on a better economic trajectory, which we all know begins with education. And affordable education. We all know that so many young people don't go to college because they can't afford the loans. And they know they'll never be able to repay them. And so how do we bring down the cost and increase the access to education?

Valerie Jarrett (35:18):

And then we have to work on the employment side. And look, there's so much that every business leader who's tuning in today can do to go out and recruit. And the good news here is that you're not doing it because it's a nice thing to do. You're doing it because the evidence now shows that diversity is a strength. It gives us a competitive advantage in a global marketplace. And that goes to people of color and it goes to women. And also the good news is that the majority of CEOs now understand that, but the question is, does it trickle down within the culture of the organization?

Valerie Jarrett (35:54):

And so you have to put in place both structural and cultural changes that make it easier for people to enter the workforce, have that upward mobility and stay there once they're hired. And that's when policies around inclusion becomes so important. Now, I always say to people, if you want to recruit black people, who are you sending out, and where are you sending them? Do you recruit at HBCUs? And when they come in, do they see anyone who looks like them? And I think there's a greater level of sensitivity to the importance of implicit bias training, for example, I'm on the board of Lyft. There isn't anyone at Lyft, to hires who hasn't first had to go through implicit bias training to try to level that playing field. Because we all have implicit biases.

Valerie Jarrett (36:38):

So I think that the beginning is the education and then it is increasing opportunity in the workplace. And it's making sure that people who are hired feel welcome and that could be everything from the affinity groups that I know a lot of companies have, to ensuring that they have mentors that help them move up the corporate ladder. And also helping businesses get started. Access to capital is a huge barrier. What are we doing to ensure that black owned businesses have that access to capital so that they can grow their own net worth, without having to depend on others? So there's so much that we could do. And the good news is that I think businesses are beginning to wake up and realize that.

John Darsie (37:24):

Thanks a lot, Valerie. We have another question about process and organizational management. So the Trump administration has become notorious for a revolving door personnel and a lack of organizational management and structure within the White House. What did an average day in the Obama administration White House look like from a process perspective? And what you can tell from the Trump administration, how did those two processes differ?

Valerie Jarrett (37:52):

We were big on process. Process was important. We wanted to make sure that recommendations that went to the president were soup as we called them. That we didn't take half baked, and mix my metaphor, ideas to him. And so we put a structure and a process in place. But before that, and I co-chaired his transition team, we spent a lot of time on recruitment. We spent a lot of time vetting folks, which is painful, as Anthony can tell you, it's a horrible process that you have to go through. You just have to lift up your skirt and tell everybody everything. But that's so important on the front end, not just in terms of making sure that folks who needed to get confirmed would be able to get confirmed. But of the people that you're hiring, share your values, your perspective, your determination to move the country forward. And then you have to work to build a team.

Valerie Jarrett (38:40):

But let's go back to the process for a minute. So the average day for us consisted with a senior staff meeting, with the chief of staff, a small one with the most senior advisors, then a larger one where our direct reports would come in. We'd focus both on the challenges of the day, but we always made time for what are the longer term projects that we're working on so that we can keep those in the back of our mind and prioritize? We'd meet with the president. We'd go over the recommendations that were coming from the staff.

Valerie Jarrett (39:08):

Our staff secretary had a hugely important job. It doesn't sound very sexy. But that person was responsible for making sure that the paper that went to the president had been fully analyzed by the necessary parties, whether it was the policy councils, the domestic policy, the economic policy, national security policy. Whether it was the cabinet agencies had weighed in. And then it came to the senior staff for us to weigh in. We would spend enormous effort on the paper. President Obama spent hours, hours every night after dinner, reading memos that we had sent him. Decision memos or our discussion memos, because the most important precious quality that the president has is his time. And we wanted to make sure that we were efficient with his time that it wasn't just the last person who walked in the room that was changing everything. And we stuck to that process. And I can say every chief of staff he had, was really good at trying to make sure the process was tight.

Valerie Jarrett (40:11):

And we worked on our culture. And I'll tell you, early on, some of the women were having a tough time. And I described in my book, president Obama who said, "Wait a minute, your voices are important. You're here because of your subject matter expertise, but also because you're going to present a different perspective." And how we had to work on that culture, which takes time and energy and determination and intentionalism. And that applies to any operation, any business, private or public. And by the end of the first term, he told a reporter, "In the beginning, I had the best team on the field. And by the end of the first term," the best players on the field. I blew the punch line. "By the end of the first time I had the best team."

Valerie Jarrett (40:50):

And I think that's also a message, how do you work with people so that they trust one another? So that if you have a crisis like one of our biggest self inflicted debacles was when our website for healthcare.gov crashed. And we had spent months trying to get it right. And the president had been so clear, "Is it going to work? Is it going to work?" "Yes, sir, it's going to work." And then it didn't work. And we didn't spend one minute blaming one another for it. Nor did he, I might add. It was like, "Get to work and get it fixed." And you can't do that, unless you are sure that you are a team and that you have each other's backs.

Valerie Jarrett (41:28):

And so I'm not in the current White House. But I will say, having a revolving door, having so much leaking to the press, having a message changed so many times in the course of the minute, let alone the day and the hour, and not having the discipline of ensuring that whatever the president says is accurate and evidence based. And I remember one of our press secretaries once said, when I was into a briefing before he went out to the briefing room back when there were briefings, if you're not sure, I can't say it. He said if I go out there and I say something that is not true that will reflect on president Obama. That doesn't mean we always got it right. But it shows the intentionality of the effort.

John Darsie (42:13):

Thank you, Valerie. One more question. And this relates to the 2020 election, you talked about the importance of voter turnout and how you and a lot of Obama administration alumni have been focused on the voter turnout piece. But if you're vice president Biden or his campaign manager, and you're trying to zero in on one, two or three core themes to hit on that are going to resonate with swing voters in swing states, there's obviously a lot of things that you could nitpick about, or not nitpick that you could criticize president Trump about in terms of character flaws and dividing the society. What are the core themes that you think he should really focus on, vice president Biden, in order to really pull those swing voters to his side?

Valerie Jarrett (42:55):

Well, I think the economy. Look, it's front and center. Millions and millions of Americans have lost their jobs. We have higher unemployment than anytime before the Great Depression. So for those who lost their jobs and who don't know whether by the election they'll have their jobs back, those whose jobs were changing anyway, as a result of technology, what are we going to do to rebuild the economy, not just back to where it was, with a very low unemployment rate, but with a lot of people underemployed, what are we going to do to make sure that we are building an economy that works for everybody? That people aren't slipping through the cracks. What are we going to do about our healthcare system to make sure that we move on the building blocks of the Affordable Care Act, as I said earlier, COVID-19 has laid bare the health disparities that exist.

Valerie Jarrett (43:41):

I think that people who are in swing states want to know that we are going to also re-enter the global dialogue as the leader of the free world again and not necessarily just go it alone our own way because the big challenges that we have as a world, really have to be solved through cooperation. The Paris Climate Accord that president Obama so successfully was able to get nearly 200 countries to sign require that effort because the United States can't combat climate change alone. The deal that we had to keep Iran from developing nuclear weapons required Russia, China, Great Britain, France, Germany, the European Union, all working together to put pressure on Iran. Big challenges require... Pandemics. The reason why Ebola never reached our shores was because president Obama got on the phone with other critical world leaders and said, "We have to work to contain it so that it doesn't bleed out and enter into our countries." The goodwill that you need in order to do that is something else that I think vice president Biden brings to the table.

Valerie Jarrett (44:47):

So the economy, health care, making sure people are treated equally. Being a world leader, again, participating and working with our allies, not chastising them and aligning ourselves with those who don't reflect our values. All of that's important. And then the final point, which is really the vice president's message is, he wants to really bring back the soul, restore the soul of our country. And I think that's the empathy. That's the sense that we are better when we are together. The [inaudible 00:45:17] of our message. I think that that is important as well. I think that will resonate not just with swing voters, but with many good Republicans and Democrats, too.

John Darsie (45:31):

Valerie. Thanks so much for joining us today on short notice. You were our first call when all the social unrest and the situation with George Floyd happened, to get your perspective on what's going on in the country and the path forward. I want to give another plug for your book. If you haven't read it, you go to valeriejarrettbook.com. Valerie, I think has one. I put the camera on her.

Anthony Scaramucci (45:50):

Well, let's get it up on the camera here. Valerie, hold it up. Let's take a look. All right you look-

Valerie Jarrett (45:57):

That's the paperback.

Anthony Scaramucci (45:58):

Let's face it, you look-

Valerie Jarrett (46:00):

Pardon me. Well, I was saying pushing the paper back because I added two new chapters, at the end. One of them presciently about my grandson, at the very end in the world. I hope that he has, he's black and I'm brown. And I talked about his parents having to give him that talk. And this was long before the current crisis. And so in a sense, I hope people will read it with the thought of my grandson in mind, and what can we do to make sure that his life and the lives of so many other people of color are better than they are today?

Anthony Scaramucci (46:33):

Well, I'm certainly looking forward to it. I read the one last year that you gave me and thank you for that. And I'll read those concurrent chapters. But go ahead, John, everyone's focused on the duck behind you. But go ahead, John, do your best here to finish it up.

John Darsie (46:48):

All right. Well, yeah, we want to thank Valerie again for joining us. Her and Anthony have struck up a great friendship. And when Anthony was set to serve in that OPL position in the Trump administration, Valerie was extremely gracious and kind and helping him make that transition. So just it's been great to watch that friendship blossom across the aisle.

Anthony Scaramucci (47:08):

She told me not to do it. I didn't listen to her, Valerie.

Valerie Jarrett (47:10):

I did tell him not to do it.

Anthony Scaramucci (47:10):

So from now on, I'm going to li... I mean, before I make big decisions like that, I'm going to call you. Okay? You'll tell me what to do.

Valerie Jarrett (47:17):

Please do. Please do. Thank you all. It's a pleasure to be with you.

Anthony Scaramucci (47:19):

All right, guys. Thank you.