Walker & Dunlop, Inc. (WD) Earnings Call Transcript

It's really a pleasure to talk with Tom Nides. As Willy introduced earlier, Tom was an extraordinary person normally, politics and business don't really mix. They often have contempt for each other, sometimes tolerance. But Tom is a remarkable person who's been able to succeed really to extraordinary levels in both of these different venues.

So Tom, your path was very interesting. You went from Capitol Hill to Fannie, Fannie to Secretary Clinton, Clinton to Credit Suisse, Credit Suisse to State Department, State Department to Morgan Stanley, Morgan Stanley to Ambassador of Israel, an Ambassador of Israel to Vice Chair of Blackstone. So the first question is, why can't you hold down a job? What's going on? We'll talk about that.

Is that before I did Everest twice? Willy, you forgot that I did Mount Everest twice. Willy, this is remarkable how you could actually be involved in bringing the audience down from what we just witnessed on the cameras. I told everyone I was going to go back to my house before I show -- decided to show up after watching that. That was an extremely unbelievable story. So Willy, congratulations to him in his achievements. And I know they're going to do a Netflix series on me given the fact that I gained 10 pounds when I was an Ambassador to Israel. So I think there is hugely -- I can hugely see the trajectory here. And the reason I've had all of these jobs is that I have not had a chance to fully read Steve's book, The Alpha Trap, which really means how to stop taking new jobs and assuming your success of where you had it, and I can't wait for that to come out or to talk a little bit more about his book later. He thought he was interviewing me. I'm going to interview him. Listen, Willy knows this really well because I've known Willy for a long, long time. And I hear [indiscernible] is here, too. Are the Walkers here? Hey, guys. Hey, [ Dianne. ] [ Dianne, ] you're not paying attention to me. Will you tell her I said hello to her. But I've known the Walkers for a long time and I've adored the family and obviously, Willy and I are very close friends. And I have seen what this company has. There's very few 3 generation companies, as they likely refer to them, as the 3Gs, very hard to do this, hard to keep them together. But the idea that Willy's grandfather and then his father and then Willy has been able to put together, this institution is a testament to the family and the values. And Willy, I'm honored to be here and to be part of this. And listen, I've been really lucky, like many -- all of us in this room, we got the lucky gene. I've had all these opportunities and being able to go from politics to business, to diplomacy to foreign policy, that's kind of cool. And we all have kind of -- I didn't get to climb Mount Everest, but I've been able to like serve the government in a whole variety of different ways, and I like making money. I'm more than happy to say I'm a great capitalist. So I like doing that as well. It's better to do these jobs in government when you're not poor. So you can pay your American Express bill. So I've been able to achieve both. So that's sort of why I can't keep a job because I like twitching around all the time.

Let's talk about that. So I mean, in seriousness, and we'll get to Iran off the back because there's some things going on there. They're pretty important that you have a unique knowledge of. But what do you think has made you successful? What are the different skills that require -- that are required for success in politics versus required in business? Are they -- to what degree are they similar? And what are the things that are unique?

I think it's not just similar to all of you in this room. You can't take yourself too seriously. I mean we're all smart. We're all lucky. We're all probably brighter than the other person. But if you actually start believing that you got to these jobs because you're the best of the business, you're going to be a loser. And I think, ultimately, for me, personally, one of the skill sets I have been able to do in both these worlds, both in business and in politics is not take myself that seriously. And more importantly, believe fundamentally that both business and politics have a lot more similarities than people recognize. People always say to me, "Hey, Tom, how can you go from being a Chief Operating Officer of Morgan Stanley to be the Deputy Secretary of State? Isn't that kind of a pretty difficult thing? Not really. In most cases, the people in government think most people in business are kind of only selfish and only care about themselves. And people in the business world believe fundamentally the people the government just screw up and waste your money. When you have people that have both these experience, it's just great for humanity. You can explain to people, not everyone in government are a bunch of jerks and want to ruin your life. And people in business aren't a bunch of sleazebags. And the combination of having both those skill sets, I think, has made me a better executive on Wall Street and in business, and it's certainly maybe a better government official. So I don't know. I think it is really a -- it's a mindset about how you look at people and jobs. And if you treat people with respect and dignity, regardless if you are the COO of Morgan Stanley or the Vice Chairman of Blackstone or the Ambassador of Israel, or whatever, or the President of the Washington Post, Steve, you know this better than most. You've got to understand your role, but you're only going to do this if you actually believe that the people around you are what making you succeed.

Right. Let's dive into the current events, Iran. So talk about your thoughts about how -- I know you don't necessarily believe that [ Bibi Netanyahu ] sort of forced us into this. But how do you think we got into this? How do we get out of it?

Well, in diplomatic terms, this is what we've referred to as a s*** show, okay?

Thank you, Tom. That's a kind of extraordinary insight that we can expect from Tom.

A lot of experience have been able to articulate that in a very sophisticated way. So let's step back for a minute. [indiscernible], one thing about foreign policy, a lot of things can be true at the same time. Make no mistake, Iran is a cancer in the Middle East, okay? This hasn't changed since the Shah left in 1979, okay? They have spread their tentacles of hate and destruction to the region for -- since that and continues today. And they've done it not only through the development of their attempt to create a nuclear weapon, but that's beyond the point. It's their ballistic missiles, it's their proxies. They fund every evil empire inside the Middle East. It's Hamas, the Houthis, Hezbollah, the amount of cancer that the Iranians has spread through the Middle East should not, in any way, be diminished and discounted at any way. So that is 100% true. It's also true that every single president I have worked for, and I've worked for Clinton and I've worked for Obama and I've worked for Biden and Trump 1 and actually going back to Bush, every single president has faced the issue about, how do you stop Iran for obtaining a nuclear weapon, okay? And [ Bibi Netanyahu, ] to his credit, okay? I have a lot of bones to pick with [ Bibi Netanyahu. ] But to his credit, for 40 years, he has been talking about the threat of Iran to the state of Israel. In his office, in the Prime Minister's office, you walk into his office, and on the wall of his office is not a map of Israel, it's a map of Iran. So he has been consistent about this. Everything else is secondary. He has been consistent about the threat to the state of Israel has been Iran, and he is attempting to try to convince each and every president to do what President Trump has done. What has happened here is the President was convinced, and again, to be clear, I'm not going to be particularly political here. I mean, obviously, you realize I'm a Democrat. But I don't find it's necessary to talk about foreign policy and political terms. I will say, however, when we did this thing called the -- again, most of you don't dine out of this nonsense like I do, but when we did the original nuclear deal, the JCPOA, which basically stopped the nuclear programs, it wasn't a perfect deal by any imagination, didn't deal with ballistic missiles, didn't deal with the proxies, they didn't deal with a lot of stuff. But it was a deal that Obama did. And the idea was to basically stop the nuclear program and begin a negotiation. When President Trump decided to rip up that agreement, presidents have prerogatives, he ripped up the agreement, and he made a commitment that he was going to basically stop the Iranians from getting a nuclear weapon after he ripped up the agreement. Unfortunately, this is where we are today. And the problem is, in my humble view, recall the Strait of Hormuz, which everyone was talking about, wasn't closed a year ago, okay? We're now fighting to open something that was never closed in the first place. And so we got the present, unfortunately, for good or for bad, is the [ cul-de-sac ]. He did a lot of good by diminishing the ballistic missiles, getting rid of some of the gray nuclear dust, which is a little bit absurd, but [indiscernible] partisan, nuclear dust. But the reality of this is that the present now, the Iranians understand that the President wants to end this war. He's made it very clear that he wants to end this war. So the Iranians know that. Trump is trying to end the war. But the Iranians won't let him end the war. And so we are in a very, very, very difficult place. And I'm very -- I'm scared. I was in this role a couple of weeks ago. It's very dangerous for the Israelis. Israelis are very unhappy right now in the current situation. They are the victims of this. They're very unhappy. They want Trump to keep going. Trump can't really keep going because of oil prices and the midterm elections. So we're in a very dangerous place because, as we all know, my biggest fear is some huge accident is going to happen or something on purpose is going to happen, meaning one of these drones is going to hit one of our bases in [ Bahrain ] or [indiscernible] or Kuwait. And God forbid, hurt some number of our military, okay? That hasn't happened yet. But when it happens, all hell is going to break loose. At that point, it's going to unleash something that I think none of us have yet to see, and that scares the hell out of me, okay? So you got -- we're in a very, very dangerous place. And my hope is that cooler heads will prevail. The Iranians will come to their senses. President Trump will stop saying things on Monday and change his mind on Tuesday and change his mind on Thursday. I hope we'll get to get some reality put in place here to begin getting this resolved, but this is a very, very dangerous place to be in.

Taking a step back, can you talk about why the Israel relationship is so important to the United States? And has this war strengthened or weakened that relationship?

Listen, I'm a Zionist. I saw some of my fellow -- some Orthodox Jews in the audience, I don't know where you guys went. But I saw you walking. There you are. Hey, guys. There are very few [indiscernible] here in Sun Valley. So glad to see you here. I think it is -- this crushes me. I was just -- I was coming in here and someone just showed me a poll that 82% of Democrats have a negative view of Israel, okay? I mean really? And I saw a poll that 35% of Republicans also share that view. There's going to be a vote today in the House about cutting the assistance out of Israel. As a Zionist, as someone who cares deeply about the state of Israel, thinks deeply about the security of the state of Israel, it sickens me okay? It really is a -- we're in a very, very difficult place right now for the bilateral relationship. We'll get -- I like to tell -- I gave a speech in Miami a couple of weeks ago at the [ AGAC, ] which is one of these other -- I've now become a professional Jew. But one of the -- at some one of these groups, and I said, we're -- they didn't like this, but I said we're sort of like we have to be like alcoholics. And they're like, "What do you mean?" They all looked at me and like, "What do you mean?" We have to admit that we have a problem before we can deal with the problem. And we have a problem. But I say we're jews, we can figure this out. And we're going to have to figure this out because if you're 30 years old today and you are younger, the only thing you know about Israel right now is the Gaza War and Bibi Netanyahu. And that's unfortunate because the magic of Israel is this little country that was created in 1948. It is the only democracy in the Middle East. You can stand in the middle of the street in Tel Aviv and hold a sign and say, I hate Bibi Netanyahu. Bibi Netanyahu should go to jail. That's not mine, I'm just saying, you know, the silence. And you will not get arrested in Israel. This is a democracy. This is the only democracy. It is our only true, true friend in the Middle East. They are our friend everywhere in the Middle East. This is the startup nation. It is a country of 9 million people, of which 2 million of them are Arabs, okay? So we've lost that whole narrative. And someone who cares passionately about Israel, cares passionately about the security of Israel, we have a huge problem. And I think we're going to have to have -- spend a lot of time -- and by the way, it's not just the liberal democrats. Some of my more conservative Jewish friends will say, "Oh, it's all you, Liberals, who hate Israel." This is actually not true. Tucker Carlson, last time I checked, is not a Liberal Democrat. And so we got a big problem, and we'll get through it. I believe we need new leadership in Israel. I think we need to get through this. But the security in the state of Israel is paramount. We need to make sure Israel has the security it needs to protect itself, but we are in a very, very dangerous place. It's interesting in one little footnote. Iran has not shot missiles into Israel over the last 10 days. They do not want to get Israel sucked into this again because they know the amount of terror in which Israel will bestow on Iran if they have an opening here. So it will be a very interesting dynamic here in the next 72 hours and how far this goes. But it's getting precariously close, this thing, tipping over into a complete chaos.

And as part of the problem that you have 4 different groups that are distinct with some overlap. You have the Israeli people, the Jewish people, you have the Israeli government. You have the Palestinian people and you have Hamas. And people always conflate those and people talk about criticizing the Israeli government is due to being antisemitic. Whereas if you go the other way, you're an enabler. Is that part of the problem?

Let's discuss. I tell people -- I'm one of the few people who admit that they have friends in APAC and at J Street. I'm very close to the policy and leadership. I mean one of the things I was lucky enough -- I'm not ideological. I mean, yes, I'm a little Democrat, but I don't -- I came to Israel, and I was like, listen, guys, I'm not a religious guy, I'm a liberal reform Jew from Duluth, Minnesota. I'm the youngest of 8 kids. I mean, my parents were like community leaders. They were the head of the [ UJ ] and [indiscernible] and all sorts of stuff. So I came there without a bias one way or the other. I had all -- a lot of friends of [indiscernible] community, had a lot of friends in the real hard left. And the reality is Israel is a melting pot. I mean the reality is people don't know that Arabs work side-by-side with Israeli in Israel. I mean they've lost that whole set of narratives. I mean, go to a hospital, a school and educational facility, there's -- the Arabs are at the heartbeat of the country. In fact, if it hadn't been for the Arab parties, the last Prime Minister, I had 3 Prime Ministers when I was Ambassador, I had Bennett, I had Lapid, and I had Netanyahu. The only reason Bennett and Lapid were actually Prime Ministers because the Arabs voted for them, okay? So the reality is people don't know all that because it's too confusing and they hear all this stuff. The reality is the people talk about a 2-state solution, like we got to have a 2-state solution. I talk about it all the time because you have to, you have to say it, and I hope it would happen. But put that aside for a second. What Israel needs to do is treat the Palestinians with dignity and respect. And things like housing and education and health care in parts of the West Bank need to be implemented. We lose sight because everyone uses all these rhetorical terms. We need to say solution. I believe I need that we need to [indiscernible]. In the meantime, people need schools, need health care. So when I was an Ambassador, I spend a lot of time on the little things. It's like your business. It's the little things that make your business. It's not that if you're in a servicing business and a mortgage servicing business, it's making sure those mortgages get serviced. It's not the kind of overall arching idea of interest rates is great. But in your business, in my view, we need to do more for the Palestinian people. The Hamas is a terrorist organization and they should be destroyed. But everyone in Gaza aren't Hamas. We get stereotyped, every idea that every Palestinian is a terrorist, that is complete nonsense. It's like everyone in Gaza is a member of Hamas, it's complete nonsense. It's not every Israeli hates Palestinians. It's nonsense. It's the small minority that creates the chaos for the rest of us. It's a small minority of people who create the insanity in which all these wars begin and we have to understand that.

And you were uniquely suited to look at the Middle East, take a bigger view of the Middle East. How do you think things have changed with the UAE with Saudi Arabia, the Abraham Accords. How do you see that? How has that evolved? And how do you see it evolving going forward?

First off, I give Trump Administration a huge credit for the Abraham Accords. I don't know how many of you understand it or are involved like I was. But Jared Kushner in Trump's first administration, I like Jared, I think he's a really smart guy. I'm not sure he should be -- I think he should be doing this either full time. This idea, you have a private equity fund and you're doing diplomacy is a little bit -- I wish I knew that. I would have never given up my stock at Morgan Stanley. But just kidding, of course. I'm not trying to be partisan. But to his credit, he formulated something which should -- he really should have gotten the -- I don't know about the Nobel Peace Prize, but something close to it. It was the first time a negotiation that occurred that the Morocco, the Emirates, UAE and Bahrain recognized the State of Israel. It was referred to as the Abraham Accords. This was a big deal because even after October 7, after October 7 in Israel, when the Hamas did the atrocities on the State of Israel, those 3 countries stuck with Israel. They never broke relationships with Israel. This is what could be. We were so close to getting the Saudis involved in the Abraham Accords. I mean I worked -- I was telling some report of this yesterday, I did some TV interview yesterday. Lindsay Graham, I love Lindsay Graham. I mean he was sort of nuts, but I really love Lindsay Graham because he wanted to do the right thing. I always want to do the right thing. And so I was sitting in the hotel lobby of the King David Hotel. And Lindsay Graham, I knew Lindsey Graham because he had called me, when I was Deputy Secretary of the State, he asked me for a favor, and you love Senators who call you and ask you for favors, especially when you need them to help you on something else. I mean it's sort of like Wall Street. So anyways, he called me and he asked me for his -- he had a constituent that has some sort of textile problem. I didn't know what it was. So I asked one of my staffers to take care of it. And again, I hope it was legal. Anyway, one day, he call me later, he goes, "Tom?" Lindsay. "I'll never forget you, what you did for my constituent. It was really, really -- he's my best friend." And like, I still, to this day, have no idea what I did. But he singlehandedly helped me get elected, helped me get confirmed in the Senate twice. He literally called Republican Senators, made sure I was confirmed unanimously, both for his deputy sector and his -- so he was my guy. So I couldn't tell them, my liberal friends that because they'd would be really mad. So I'm standing in the King David hotel. And as you recall, MBS, the leader of Saudi Arabia, as you know, sort of had a bad day when he, unfortunately, was involved in the Khashoggi killing, right? As you remember, the Washington Post, [indiscernible], you probably knew Mr. Khashoggi. And there was a lot of hatred towards MBS for being involved in that untimely death of Khashoggi. And Biden, President Biden pledged during the campaign at that the [indiscernible] were basically terrorists and he would never see MBS and he would never spend time with MBS because he was a killer. And so Biden was coming to Israel for his tenth visit right in the middle of COVID when I was Ambassador. And he -- we pushed Biden to go to Saudi Arabia and mend fences with MBS, or not mend fences, but have a meeting. And by going there would, by nature. So I'll go to Lindsey Graham thing in a minute. So we convinced Biden to go because we thought, you can't be fighting with everyone. We're right before the midterm elections. We've got to make sure oil prices are stable. And it's -- everything in life is politics. And Biden, to his credit, agreed to go, but he said, "I'm not going to shake his hand." It was right in the middle of the COVID season. So we practiced fist bumping, okay? And so he fist bumped MBS. So we didn't have the photo of him greeting -- it was all kind of nonsensical, but that's what you do. Anyway, so I'm sitting in the lobby of the King David Hotel with Lindsey Graham. And Lindsey Graham, just like Biden was trashing MBS, kept saying all sorts of nasty things about MBS. And he said -- but he said, "Tom, I think there's an opportunity to normalize Saudi Arabia with Israel." I said, "Well, Senator, how are we going to do that? You've been trashing MBS, too." He goes, "Tom, wait to see what I do." He said, "I'm going to do an interview in about an hour with George Stephanopoulos in the lobby of the King David Hotel. Just watch what I do. And that guy sat in that chair and he reversed himself on his hatred of MBS. Basically said, I think I can do business with that guy, MBS. And from that moment on, for the next 2 years before October 7, Lindsey Graham spent all his energy working on getting normalization between Saudi Arabia and Israel, working with the Biden administration. He was totally into it. And then obviously, it all fell apart after October 7 because the Saudis couldn't talk to Israel, and the whole thing fell apart. But I say this because Jared Kushner created the platform of these things called the Abraham Accords, and then layered on top of that with the potential of Saudi Arabia. If we can get back to that, it will be dreamy. Now we're dealing with the war in Iran. So who knows. And I think ultimately, I don't know how it's all going to shake out for the rest of the Middle East. But the reality is the Saudi piece of it could be really important, the Abraham Accords was exceptionally important, and we should use that as a foundation.

It just shows how difficult these conversations are because when I hear about an employee in the Washington Post who was killed and chopped up with a bone saw, we kind of think that guy isn't a great guy. But you have to think of the bigger picture. These are tough conversations. So you talked about October 7. So you were watching a preseason basketball game in Dubai, NBA basketball game. And Jack Lew had been named, but not confirmed, as your replacement as Ambassador to Israel, and you found out about October 7. Can you take us through what that was like? What happened? What you were asked to do?

It's even worse than that. So I'm in -- the Timberwolves were playing with the Dallas Mavericks in the first exhibition game in Abu Dhabi. And Miriam Adelson had just bought the Mavericks. I knew that, but no one else knew that. And she invited me and we get into the whole Miriam Adelson shtick in a minute. So she invited me to come to Abu Dhabi for the game because Timberwolves -- I'm from Minnesota. So I said, this is going to be cool. So we're sitting at dinner in Abu Dhabi with all of the players from the Mavericks and the Timberwolves. And I have all the diplomatic core from the Middle East, and I have a bunch of Jews from Israel. And I've got the UAE Ambassador who was instrumental in the Abraham Accords, Yousef Al Otaiba. And I stand up. And I'm toasting the success of the Abraham Accords, and long live the Abraham Accords and blablabla, and I'm like, going on and on probably too long. And 2 hours later, our phones start lighting up. There's something really crazy going on in Israel, like really crazy, like crazy like we've never seen before crazy. And it just was the beginning of what we saw play out, and so all of us left. None of us obviously went to the game the next day. We all got on planes. I flew back to -- I felt terrible because I just left a month earlier. And my wife runs CNN. So she was like, your next wife can follow you to Israel, sort of going up like Mount Everest, but she did not want to go. And she visited me however. And so I left, and I felt terrible because my [ DCM, ] my deputy was in charge. And she is really great. This happens to be now the Ambassador of [indiscernible]. So she was dealing with what arguably was the biggest crisis in the state of Israel has had since the beginning of the country, okay? I mean the amount of just terror, I mean I had 3 or 4 friends who lost her kids at the festival. And for all of you to remember, I don't -- again, I don't -- I can't imagine all of you to spend much time thinking about this, except for my friends back there. But the reality is what happened on October 7 since that no larger number of Jews were killed in a single day since the Holocaust on that day on October 7, okay? And it wasn't just the killings of the Jews and Arabs, by the way, on October 7. The kids that were in that, the concert was like burning man okay? They went to this concert to show you could have a concert at the wall, the Feds dividing Israel to Gaza, it was a bunch of kids having a fun time. These were not protesters, these weren't -- these are kids getting high and having fun and listening to music. It's sickening what Hamas did on October 7. And then not only the brutality of the number of people that were killed, but the brutality of ripping all these people and bringing them to Gaza and showing them in the tunnels. And it is beyond anyone's imagination. And if you -- for all of us, I think all of us in this room have had tragedy, you wouldn't be -- all of us have had some sort of tragedy, right? We all have it. This is a level of tragedy that I don't think any of us could ever, and God forbid, ever endure. I spent a lot of time with the hostage families who basically woke up every day just trying to get their kid back. And then I have -- my friend [ Ruby Chen, ] who -- all he wants is kid's body back. He knew that the kid was dead. He just wanted his body back to bury him. You can't -- again, I don't mean to get on this. So the level of what happened on that day changed Israel forever, forever. And that's what -- for me, as the former guy, I felt a little bit like -- so I know I basically then spent the next 6 months just working on behalf of the community and trying to raise money and do the things you do when you can't be there on the ground to help.

Thank you. So shifting gears a little bit, thinking about DOGE, and you were obviously were the Deputy Director of State Department, and you've seen what's happened, 300,000 federal workers cut in just the first 1.5 years of the Trump administration. Only 28 of the 150 ambassadorships are filled. For people on the right, they might say, well, we've discovered massive inefficiencies because the world seems to be working fine. Have these been efficiencies have been uncovered? Or are there things that we're going to regret later on? What's your view with all this.

Again, I'll try to be disciplined here. I think Elon Musk is must is a brilliant guy, okay? Listen, space tech, what he's done on Starlink, what he did on electric cars. I mean no one will take it away from him. But I thought what he did on DOGE was disgusting. Now, I don't blame him, I blame how they did it. To be clear, the President of the United States that cut more civil service jobs in any president in the United States was Bill Clinton and Al Gore. Al Gore was in charge of reinventing government. I was involved in this, okay? He actually replaced more government employees than Elon Musk. There's a way to do this, and there's a way not to do it. Is there a waste at the government, 100%? Is there waste in budget of your companies, yes, probably. I mean, maybe, don't take that personally. But just hypothetically, okay? Yes, okay? There is a way of doing this and there's a way of not doing this, okay? The reality of this is to pick on the civil service of our country, it makes me sick to my stomach, okay? The men and women who wake up every day want to do the right thing. Are there bureaucrats who slow things? Sure. But the vast majority of the people that I work with want to do the right thing. And do I believe we can do things better and faster? 100%. Let's just take an example, okay? USAID. USAID reported to me. I was the Deputy Secretary of State. What people don't understand about USAID, USAID, which is not perfect and needs reform, I get all that. But USAID represents to our country, soft power, you know what soft power is? Hard power is our military might. Soft power is what makes America, America. It is what distinguishes us from China. It's what we do in countries in how we make countries better. And it's not just what George Bush did with using USAID to eliminate AIDs in parts of Africa, it's everything in between. It's water, it's democracy building, it's community building. The guys who are the most biggest advocates for USAID, the U.S. military. I used to call Dave Petraeus. Every time I had to testify in the Congress, I said, General, I need your help. He goes, count on it. I will go and sit next to you and advocate for the support of USAID because my strategy is very simple. The military can clear, right? They can clear enemies out, but to hold them takes the guys in the short pants, the soft power guys. That's the only way. And by the way, we're learning this lesson right now in real time in Iran. The only way we're going to end this thing in Iran is you can blow the [indiscernible] out of them, okay? But we're going to have to have a diplomatic response. That's the only way you can get at the end of the day, long-term peace is through diplomacy. You can't bomb your way into peace. You can get them to the table but you better have a program. We learned that after World War 2. We've learned that historically. We've learned this everywhere. And so the idea you come in and you say, you know what, USAID sucks. Let's just shut it down. Really? So I think ultimately, reforms need -- be needed. To be clear, I have no problem of doing reforms. Listen, I have fired, sadly, way many people in my job that I have had running several financial institutions. I get how to do this. I know it's not perfect. But I think what they -- how they conducted themselves in how they did this, I think we'll be paying a price for this for a very long time.

Are there particular -- USAID is one. Are there particular areas where you think the cuts are going to bite us?

Listen, I think it's -- I go back to -- I think, again, people is like, "I don't care about voice of America, who cares?" Well, I'm telling you guys, when you wake up and you realize where the staining of America is around the world, some of this is, yes, part of this is somewhat of President Trump style. It's somewhat different than some other presidents. I appreciate that. Some of it is the pressure we put on rightly on NATO to spend more money on their own defense, totally support that. But I think the reality of this is, is that if you look across our government and the things that we do internationally, I'm on the Board of a thing called the IRC, the International Rescue Committee. The job is basically to help refugees who we settle here in the United States and help refugees in countries and war-torn countries. The budgets has been dramatically reduced because obviously, we're not letting refugees come into the United States anymore, and how we use those money overseas. These organizations are really, really important guys. At the end of the day, what made America, America was our kind of -- we were the -- we are the shining light on the mountain top, as Ron Reagan used to say. That's what made us who we are today. And again, I'm not being critical about the administration. But I do think, ultimately, we got to get back to a little bit of that. And maybe we went too far, maybe we were too open, maybe we were to this. But I think ultimately, for our country to have the strength that we need, we need the soft power as much as we need the hard power.

And so speaking of things generally viewed as helpful. We asked NATO countries to spend more on defense, and that's -- and they're doing that. So does that make us safer or less safe with a more militarized Europe?

Listen, you look at what's going on here. We have a raging war going on in the Middle East. Do I want to remind any of you? We also have a massive problem with Russia-Ukraine. We're not talking about it very much, but it is a -- quite frankly, that is a bigger threat to the security of our European allies than the Iranian capacity to get a nuclear bomb, okay? We're not talking about because it was supposed to be resolved in the first few days of the Trump administration. But sadly, these things are really, really complicated, and the Ukrainians aren't giving up and the Russians aren't giving up. And the more the Ukrainians push the Russians, there's a chance that Putin may say, "I got to go much more aggressive." And then all better off, okay? So do I think a unified NATO is helpful? Yes, I do. I mean I didn't like the idea. I really didn't like the idea that when President Trump picked up the phone and called Macron and Starmer in the U.K., and Macron in France and said, I need your help on Iran, at the Strait of Hormuz, that he got basically the [ Heisman, ] okay? I don't like that. I don't -- I think the American President, when he picks up the phone, this is what our NATO allies are supposed to do, are supposed to help us. And I think this may be the future that we're at. And much of this is for a whole variety of reasons. It's fighting around things like Greenland. It's about Iran. It's about Ukraine and Russia. It's about Zelenskyy. That's very complicated. But at the end of the day, a strong European allies, a strong NATO is good for the United States. Make no mistake. Yes, we paid too much. They need to pay more. No question about it. But we need their help, we need their support and we need to be working collectively together. Breaking up NATO is a terrible idea. Weakening NATO is a terrible idea. At some point, the United States needs to support. It may not be the military support, but we need the support of our NATO allies.

Do you -- how confident are you in the alliance structure being able to survive? And related to that, what do you think the chances are of a military conflict involving Taiwan?