00:00You write about the echoes of 1973, not a great economic picture here in the U.S.,
00:05and all of a sudden war breaks out in the Middle East.
00:07And you note that an energy crisis can snowball into a wildly unpredictable everything crisis
00:11more quickly than governments can manage.
00:15Let's start with just the aptness of the comparison.
00:17So here we are in the early days of this war.
00:20How good an analog is what we're experiencing now to what happened then?
00:23I think it's pretty good because you've got to start with the domestic political context.
00:27That's one place to start.
00:28In 1973, Nixon was in the middle of Watergate.
00:31He had another year or so of his presidency.
00:33So the White House was just a terrible place to be.
00:36You had inflation was spiking.
00:38He tried price controls the year before.
00:42But in the economy as a whole, there was an affordability crisis going on.
00:45The loaf of bread had doubled.
00:47And then you had this oil price spike.
00:49Now, it wasn't just the war that started it.
00:51The producer countries had been raising prices.
00:54It was essentially they'd taken back control of oil from the Western majors that controlled it for many years.
00:59So you have this combination of an administration that was really – you couldn't really trust its motives.
01:04You had a genuine affordability crisis, inflation spiking, and then this breaks out.
01:09And you don't really know how this is going to spin out of control.
01:12So when you look back, I mean, there's a saying, history doesn't repeat, but it does echo.
01:17Is this more of a direct repetition?
01:19Is it an echo?
01:20And are there specific lessons that this administration should be learning from this time in history when there were very
01:25similar circumstances?
01:25Well, I think everyone always wants these things to go as quickly as possible.
01:29Yeah.
01:29And I think what you're seeing today is exactly that.
01:32The Yom Kippur War actually only lasted a couple of weeks before there was a ceasefire brokered by the Soviet
01:37Union and the United States.
01:38But the effects of it lasted a lot longer, largely because oil prices quadrupled between October and the end of
01:44the year.
01:45And again, due to the fact, as I've explained, not just the war but other sort of macro factors.
01:49And I think what you saw then was less developed countries really struggled to pay their bills.
01:54Even developed countries like the U.K., European countries started having to borrow at enormous rates just to sustain their
02:00economies.
02:01And so this thing really dictated the future of the global economy for two, three, four years going on through
02:06the 70s.
02:07We think of the images from 1973 folks lined up down blocks and around corners waiting to fill up their
02:13cars.
02:14It was difficult to do.
02:15And obviously that had a dramatic effect on sentiment in this country.
02:19How do you think about that, the way in which the American public is processing this particular war, this crisis,
02:25at a time when the rationale for it hasn't exactly been made clear by the administration?
02:29Well, to go back to the context, I think there is a context of mistrust.
02:32You know, what is this administration doing?
02:34What are we supposed to believe?
02:36Tariffs are supposed to have raised billions.
02:38And now here is a war costing billions by the end.
02:41A tax cut has been put in place.
02:43You have pressure on the Federal Reserve to cut interest rates when inflation is going up.
02:47So I think a lot of people are looking around and going, why?
02:50What is this?
02:51Can we afford it?
02:52What's going to happen next?
02:53Why isn't there more of a focus on what my household goods basket is costing?
02:58Is this a war that's a reckless thing for America to pursue?
03:01And a lot of people still remember what happened 20 years ago.
03:03That's not out of the public memory.
03:05So you have gas lines in the 70s, but also a war that started with the prediction that we'd be
03:10in and out of Iraq quickly.
03:11And that wasn't the case at all.
03:13One of the other things you talk about is the impacts it had on cars and the kinds of cars
03:17people were buying.
03:19And right, I feel like we keep going through these cycles.
03:20And right now, gas has been cheap for a while.
03:23Manufacturers are going back away from electric.
03:25Big SUVs are on the street again.
03:27If this continues to have a knock-on effect, as you mentioned for several years,
03:29do you think we're going to see that reflected in the kind of cars Americans are driving?
03:33Certainly.
03:33I mean, in the 70s, you know, the beginning of the 70s, the fashion was these eight-mile-an-hour
03:37land yachts,
03:38these enormous cars, the Buick, Rivera, big boats with kind of velvet front seats.
03:42And air conditioning was going in cars, which vastly increased the cost to run cars.
03:48But by the end of the 70s, you had Civics from Honda.
03:51You had the Rabbit from Volkswagen.
03:53You know, the Japanese and German small cars really started to take off.
03:56It took a while, but American tastes really changed by the end of the 70s
03:59as people realized there was money to be saved doing this.
04:02Let me ask you last about my favorite part of the essay,
04:04and that is the effect this had on popular culture.
04:07So, yes, we think about how it impacted folks at their kitchen tables,
04:10but as you know, it really changed the way folks entertained themselves,
04:16the way that sporting events were run.
04:17Talk a bit about that, just the effects then and the legacy of that going into this crisis.
04:21Well, there were all kinds of crazy things happened.
04:23In early 74, the Daytona 500 became the Daytona 450.
04:27Unbelievable.
04:27Because they only could go 450 miles around the track.
04:31The James Bond film, The Man with the Golden Gun, late 74,
04:34was all about this thing called the Solex agitator.
04:37It was essentially a device to conserve solar energy,
04:39and it was about the rise and use of solar energy.
04:42And Bond thinks the shakes will try and buy it,
04:44the oil shakes will buy it to raise the price of oil.
04:47You had truckers who had protested the oil price rises become these kind of modern cowboys.
04:52And so in the 70s, you get films like Every Which Way But Loose,
04:56Clint Eastwood with an orangutan in a truck.
04:58But the trucker had become this kind of modern cultural figure.
05:02Which you can actually apply to the US.
05:02So problematic.
05:04Do you see that happening?
05:05I mean, do you expect to see this creep into Hollywood, pop culture, all of the above?
05:11I don't think you can avoid it over time.
05:12If this goes on, oil crises just are so, they affect everything in our lives.
05:17They not only affect geopolitics, but they affect the way we live.
05:20As you said, we've been dialing back on electric vehicles
05:23in what now seems like a terrible moment we've been doing that.
05:25And eventually, yeah, you'll see it in music, you'll see it in films.
05:28This will become a moment that people will remember, like they remember the 70s.
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