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Interview With Michael Murphy: Masters in Business (Audio) · Masters in Business

• 0:03
  Speaker 1: This is Masters in Business with Barry Ridholds on Bloomberg
• 0:07
  Speaker 1: Radio this week on the podcast what Perfect Timing I
• 0:12
  Speaker 1: Have Michael Murphy uh He is the founder of the
• 0:17
  Speaker 1: Right to Rise pac, a conservative pack that raised a
• 0:21
  Speaker 1: hundred million dollars for Jeb Bush and and conservative causes.
• 0:25
  Speaker 1: He has been the campaign manager for people as diverse
• 0:31
  Speaker 1: as uh Arnold Schwarzenegger, Governor of California, Mitt Romney, Governor
• 0:38
  Speaker 1: of Massachusetts, and presidential campaign candidate Jeb Bush who ran
• 0:44
  Speaker 1: for the nomination of the Republican Party uh in and
• 0:49
  Speaker 1: and did not make it. The timing of this is perfect.
• 0:53
  Speaker 1: He is not only a conservative and a very successful
• 0:59
  Speaker 1: political and pain consultant and adviser, but he is a
• 1:04
  Speaker 1: person who has been watching elections for a long time.
• 1:09
  Speaker 1: Full disclosure, he is a member of the Never Trump
• 1:13
  Speaker 1: group who think that um Donald Trump is not the
• 1:18
  Speaker 1: ideal candidate to be president of the United States. I
• 1:22
  Speaker 1: found this whole conversation to be quite fascinating for two reasons. First,
• 1:29
  Speaker 1: we booked it six months ago having no idea, UM
• 1:32
  Speaker 1: what would happen in the campaign. Because I thought we
• 1:36
  Speaker 1: were booking Michael Murphy, the technology newsletter writer and I
• 1:40
  Speaker 1: thought this was going to be an opportunity to geek
• 1:42
  Speaker 1: out about all things technology, software, telecommunication, etcetera. Instead, we
• 1:49
  Speaker 1: got lucky and we got the guy who is really
• 1:52
  Speaker 1: an extremely influential person, uh in the Republican Party. So
• 1:58
  Speaker 1: that's number one and number two. The time we booked this,
• 2:00
  Speaker 1: we had no idea who the nominee was going to be.
• 2:03
  Speaker 1: We had no idea, um about anything that was taking
• 2:07
  Speaker 1: place on the political side. Uh. It's a pleasure to
• 2:11
  Speaker 1: speak with somebody who is incredibly skilled about political communication,
• 2:18
  Speaker 1: about the way elections run, about the way successful campaigns
• 2:24
  Speaker 1: do certain things or don't do certain things. All told,
• 2:28
  Speaker 1: the timing of this could not be better. This will
• 2:31
  Speaker 1: broadcast before the first debate, the first presidential debate, and um,
• 2:39
  Speaker 1: it was really absolutely fascinating conversation about the state of
• 2:43
  Speaker 1: politics in modern America. So, with no further ado, here
• 2:48
  Speaker 1: is my conversation with campaign consultant Michael Murphy. This is
• 2:57
  Speaker 1: Masters in Business with Barry Ridholts on Bloomberg Radio. My
• 3:02
  Speaker 1: special guest today is Mike Murphy. He is a Republican
• 3:07
  Speaker 1: political consultant. He advised Florida Governor Jeb Bush in the
• 3:12
  Speaker 1: current election. He previously has advised such luminaries as Massachusetts
• 3:18
  Speaker 1: Governor Mitt Romney, U S Senator John McCain, California Governor
• 3:23
  Speaker 1: Arnold Schwarzenegger. John McCain privately called him Murphy stapils, so
• 3:29
  Speaker 1: that should give you some sense of his ability to
• 3:32
  Speaker 1: foretell the political future. He is a commentator on NBC's
• 3:37
  Speaker 1: Meet the Press and The Today's Show. Used to write
• 3:39
  Speaker 1: a column for Time magazine, and served as a fellow
• 3:44
  Speaker 1: at Harvard University's Kennedy School of Governments Institute of Politics
• 3:50
  Speaker 1: and as I think I could fit safely say, you're
• 3:52
  Speaker 1: you're pretty much recognized as one of the GOP's most
• 3:55
  Speaker 1: successful consultants and innovators that affair statement. Yeah, I own
• 3:59
  Speaker 1: that until we lost the retro Rice superPAC for Jeb.
• 4:01
  Speaker 1: Now now I'm going to be a retired uh formerly
• 4:04
  Speaker 1: one of the great concils. But I had about twenty
• 4:06
  Speaker 1: nine winning statewide races and that got me pretty established.
• 4:09
  Speaker 1: Mike Murphy, welcome to Bloomberg. So let's let's jump right
• 4:12
  Speaker 1: into your background, because I find it absolutely fascinating. You're
• 4:16
  Speaker 1: not even out of college. You and you decide, Hey,
• 4:19
  Speaker 1: I could at age twenty launched my own political consulting company.
• 4:24
  Speaker 1: How did that help? Luckily it's an unregulated business. So
• 4:28
  Speaker 1: I was going to Georgetown, was in the Foreign Service school.
• 4:30
  Speaker 1: I grown up in Detroit, and I thought, wow, am
• 4:32
  Speaker 1: I gonna wind up in the auto industry, which was
• 4:35
  Speaker 1: kind of appealing. But I was really interested in international
• 4:38
  Speaker 1: relations and politics, so Georgetown was the place to be.
• 4:41
  Speaker 1: I was involved in the College Republicans. I was all
• 4:43
  Speaker 1: about politics, and I got this internship at the old Nickpack,
• 4:47
  Speaker 1: the National Conservative play Clashing Committee, which had invented the
• 4:50
  Speaker 1: independent expenditure where a third group could run ads. And
• 4:54
  Speaker 1: so one day they fired the ad agency and they said,
• 4:56
  Speaker 1: anybody here and anything about advertising? And I had been
• 4:59
  Speaker 1: like around a radio station a little bit in like
• 5:02
  Speaker 1: high school, so I of course said me, I'm an expert.
• 5:05
  Speaker 1: And one thing led to another, and they said, because
• 5:07
  Speaker 1: it was low production budget stuff, all right, kid, make
• 5:10
  Speaker 1: an ad. And I didn't know what to do. So
• 5:12
  Speaker 1: I called up this ACE producer who had turned out
• 5:14
  Speaker 1: later had made one ad in his career, named Alex Costellanos,
• 5:18
  Speaker 1: and out of that came Murphy and Castellanos. We started
• 5:21
  Speaker 1: making ads for these horrible, low budget campaigns because nobody
• 5:25
  Speaker 1: else would hire us, but some pack work and we
• 5:27
  Speaker 1: got lucky on a thing or two. And so I
• 5:29
  Speaker 1: took a leave of absence my senior year. I gave
• 5:32
  Speaker 1: up being yelled at in Russian every morning by Colonel Piragoff,
• 5:36
  Speaker 1: the defector, who was trying to teach us Department of
• 5:38
  Speaker 1: Defense Russian you know which way to the tractor factory?
• 5:41
  Speaker 1: Would you like some nylons for a picture of that factory?
• 5:44
  Speaker 1: And uh kind of ran away to join the circus
• 5:46
  Speaker 1: of campaign consultant. So what was the lucky ad that?
• 5:49
  Speaker 1: That was the big launch, which was the first one
• 5:53
  Speaker 1: that you you said, hey, we got something here. Well,
• 5:56
  Speaker 1: we we had we did some kind of fun stuff
• 5:58
  Speaker 1: for these independent expenditure cam pains in the early eighties.
• 6:01
  Speaker 1: But then it was the eighties six campaign when Alex
• 6:04
  Speaker 1: and I really officially, you know, got together. We're working
• 6:07
  Speaker 1: for this, Uh Senator Steve Sims on Idaho. Everybody thought
• 6:10
  Speaker 1: was gonna lose. This is a by election between between
• 6:13
  Speaker 1: presidential elections, right right, an off election. But still they
• 6:16
  Speaker 1: had the Senate races and six was a top tier
• 6:18
  Speaker 1: for the Republicans were these young guys and sims won
• 6:22
  Speaker 1: and some congressional races people thought would lose. We did
• 6:25
  Speaker 1: pretty well in and eight, six and eighty eight. That
• 6:27
  Speaker 1: put us on the map, and Alex and I went
• 6:29
  Speaker 1: off and we had a great run. We did a
• 6:32
  Speaker 1: bunch of stuff, and then in the mid nineties we
• 6:34
  Speaker 1: had probably the only amicable split up of a political
• 6:37
  Speaker 1: consulting partnership. Were still very close. He went off to
• 6:40
  Speaker 1: do a lot. You see him on CNN. He's a
• 6:42
  Speaker 1: big time probably consultant. And I had a good run,
• 6:45
  Speaker 1: particularly with governors blue state governors. I worked for John
• 6:48
  Speaker 1: Angler in my home state of Michigan, three term win there.
• 6:51
  Speaker 1: I worked for Terry Branstead in Iowa about his forty
• 6:54
  Speaker 1: of term. We got a re election there, the Jeb
• 6:56
  Speaker 1: Bush race. And I did those statewidse Christine Todd Witman
• 7:00
  Speaker 1: in Jersey. I just you know, had a great run
• 7:02
  Speaker 1: of I'm picking up the theme here. These are all
• 7:04
  Speaker 1: pretty moderate GOP governors. Is that a coincidence or well?
• 7:09
  Speaker 1: I people keep calling me a squish, which is the
• 7:12
  Speaker 1: Republican word for moderate, But I'm a pretty right wing guy.
• 7:15
  Speaker 1: How I worked for Ali North, I mean I had
• 7:16
  Speaker 1: plenty of Alex came out of the helms machine down
• 7:19
  Speaker 1: in North Carolina. But I believe in the kind of
• 7:22
  Speaker 1: conservatism that can win a swing state, which is something
• 7:25
  Speaker 1: that's kind of been lost in our party now. So I, um,
• 7:28
  Speaker 1: I consider myself pretty conservative, but I'm not at what
• 7:31
  Speaker 1: we like to call a paleocon. I'm not a cannon Republican. No, no,
• 7:36
  Speaker 1: that that's that's really interesting. So let's talk a little
• 7:39
  Speaker 1: bit about your pack. Right to Rise. This was looked
• 7:42
  Speaker 1: at as a juggernaut, a huge money making machine. Who
• 7:46
  Speaker 1: is the typical Right to Rise? Don't or describe them.
• 7:50
  Speaker 1: I don't mean, I'm not looking for a list of names,
• 7:52
  Speaker 1: but what what sort of person is this? Give us?
• 7:54
  Speaker 1: Some Democrats? Well, the way it kind of works in
• 7:56
  Speaker 1: the system now is you have a campaign for president,
• 7:59
  Speaker 1: but you're limited under law to take a limited amount
• 8:02
  Speaker 1: of money only from people, not from business entities. So
• 8:05
  Speaker 1: you can take your twenty you know, seven hundred dollars
• 8:07
  Speaker 1: or whatever from an individual. All the campaigns there, for
• 8:10
  Speaker 1: at least most of them, would create a superpack which
• 8:13
  Speaker 1: can raise essentially unlimited money. So often your donors who
• 8:17
  Speaker 1: might give you the what we call the maxed out
• 8:19
  Speaker 1: federal check to your campaign, which is relatively small would
• 8:22
  Speaker 1: also give to the superpack. So we were very successful.
• 8:26
  Speaker 1: And the one campaign we won, and really Jeb one,
• 8:29
  Speaker 1: was the donor campaign, where you travel around the country,
• 8:32
  Speaker 1: meet people and convince them the back you not somebody else.
• 8:35
  Speaker 1: I mean the people who gave to us. Many of
• 8:37
  Speaker 1: them also met with Governor Walker when he was in
• 8:39
  Speaker 1: the race with Senator Rubio, Senator Cruz. You know, they
• 8:44
  Speaker 1: were it was a competition, and Jeb had the most
• 8:46
  Speaker 1: compelling vision. So the typical person, Uh, some were longtime
• 8:50
  Speaker 1: party fundraisers who might write us a check for a
• 8:53
  Speaker 1: hundred thousand dollars. We had, you know, a lot of those,
• 8:55
  Speaker 1: or fifty thousand dollars. You had a few of the
• 8:58
  Speaker 1: real kind of super donors of the party who could
• 9:00
  Speaker 1: write I think our largest owner was over two million dollars.
• 9:04
  Speaker 1: Mike Fernandez, a healthcare executive down in Florida's big check. Yeah,
• 9:08
  Speaker 1: it's a big check. And these are successful people. Sometimes
• 9:11
  Speaker 1: it's private, family owned businesses. Uh. Sometimes they're they're folks
• 9:15
  Speaker 1: who just have always had an interest in politics. And
• 9:17
  Speaker 1: some were new and there were people generally who knew
• 9:20
  Speaker 1: the governor, many from when Jeb was governor of Florida
• 9:22
  Speaker 1: was very successful or liked his vision that we weren't
• 9:25
  Speaker 1: going to run a grievance campaign about who we're mad at,
• 9:27
  Speaker 1: and we're going to run a campaign in the primary
• 9:30
  Speaker 1: that we knew would be rocky, but we do it
• 9:31
  Speaker 1: in a way where we thought we could win a
• 9:33
  Speaker 1: general election. The primary voters wanted something else. So now
• 9:36
  Speaker 1: we've got a candidate who was very strong in the primary,
• 9:39
  Speaker 1: but is in real trouble I believe in the general election.
• 9:42
  Speaker 1: I'm Barry Ridhults. You're listening to Master's in Business on
• 9:45
  Speaker 1: Bloomberg Radio. My guest today is Michael Murphy. He is
• 9:50
  Speaker 1: the founder of Rights A Rise. Is that right? I
• 9:53
  Speaker 1: think my title? And you know we folded the pack down.
• 9:56
  Speaker 1: We returned about eighteen of the money or excuse me,
• 9:59
  Speaker 1: about twelves a different No, no, no no, we we returned
• 10:02
  Speaker 1: our capital. But let's for this way. Nobody else has
• 10:04
  Speaker 1: ever returned to Diamond Rio takes. And we gave back
• 10:06
  Speaker 1: millions of dollars. And what was your title with the
• 10:09
  Speaker 1: and with the of the right to rize pack which
• 10:11
  Speaker 1: has now been wound down except as a legal entity
• 10:13
  Speaker 1: because we get all the FBC audits after the gods,
• 10:16
  Speaker 1: you have to keep that around. And then in the
• 10:17
  Speaker 1: Bush campaign, what was your title? Uh, well, I was
• 10:20
  Speaker 1: Jeb's kind of senior strategist when he was running for governor.
• 10:24
  Speaker 1: Under the law, when in the presidential when you're doing
• 10:26
  Speaker 1: the superpack, you cannot legally talk to the campaign or
• 10:30
  Speaker 1: it's one or the other you can do. That's really interesting.
• 10:33
  Speaker 1: So so let's talk a little bit about this the
• 10:35
  Speaker 1: primary season, which was really kind of wacky. So really
• 10:40
  Speaker 1: it kicked off of me summer with the Fox News
• 10:45
  Speaker 1: hosted gop Um debate, and it was shocking. They came
• 10:50
  Speaker 1: right at at Trump right out of the gate. In hindsight,
• 10:54
  Speaker 1: it looks like that that approach backfired quite a bit. Well,
• 10:58
  Speaker 1: Trump had a constituency that was to put up with
• 11:00
  Speaker 1: a lot of heresy from Trump. In other words, he
• 11:02
  Speaker 1: could do things that were considered impolite or rude or offensive,
• 11:06
  Speaker 1: like attack and John McCain. Most people thought, under the
• 11:09
  Speaker 1: typical political rules, and I did too, that that would
• 11:11
  Speaker 1: hurt him. It didn't among the third of the vote
• 11:14
  Speaker 1: that really liked him. The other two thirds not so sure.
• 11:17
  Speaker 1: Even today, Trump, by no means has all the Republicans
• 11:20
  Speaker 1: lined up. But in a multi wait, you know, campaign
• 11:23
  Speaker 1: with fifteen sixteen candidates, if you can hold down to
• 11:26
  Speaker 1: a third, that's a ticket to the end. That's who happened.
• 11:30
  Speaker 1: And everybody doubted him far far far into the the process,
• 11:36
  Speaker 1: and in my mind's eye when he went on Jimmy
• 11:40
  Speaker 1: Fallon and did that mirror bit when the two of
• 11:43
  Speaker 1: them are, you know, it's Fallon pretended and he was so.
• 11:48
  Speaker 1: I know of him as a New Yorker full disclosure,
• 11:53
  Speaker 1: I think he's an amusing guy, but not presidential timber.
• 11:56
  Speaker 1: But at that moment I turned to my wife and said,
• 11:59
  Speaker 1: this guy can win. This guy can win the primary.
• 12:02
  Speaker 1: It was just and ever at the time, I don't
• 12:04
  Speaker 1: think a lot of people really felt what most people thought,
• 12:07
  Speaker 1: and I think the people running just about all the
• 12:09
  Speaker 1: campaigns is that Trump would be an interesting side show,
• 12:12
  Speaker 1: but he'd fizzle out because there was another candidate who
• 12:14
  Speaker 1: would get what we call the grievance vote, which was
• 12:17
  Speaker 1: very large this year, to blow it all up, hate everything,
• 12:20
  Speaker 1: mad who who's the enemy? And that was Cruise. So
• 12:23
  Speaker 1: most of us thought the real threat to the nomination,
• 12:25
  Speaker 1: who we were very worried about winning was Ted Cruz.
• 12:28
  Speaker 1: But Trump managed to kind of out muscle cruise with
• 12:31
  Speaker 1: that big persona. Trump was also with the Hollywood people,
• 12:34
  Speaker 1: and that business would call a pre aware title, which
• 12:37
  Speaker 1: is when you're making a movie, now you go spend
• 12:38
  Speaker 1: four hundred million dollars in the marketing department comes up
• 12:41
  Speaker 1: to you and says, well, we could make you know,
• 12:43
  Speaker 1: Flowers of Ralph and spend four million explaining what the
• 12:46
  Speaker 1: movies about when we make iron Man eleven, and you
• 12:49
  Speaker 1: don't have to have the same marketing iron Man eleven.
• 12:52
  Speaker 1: That's why they're making movies called battleship or you know
• 12:54
  Speaker 1: these known titles. One title, you know exactly what it is. Yeah,
• 12:57
  Speaker 1: and Trump was a known title. Now, even if all
• 12:59
  Speaker 1: he was doing was teaching Gary Busey how to work
• 13:01
  Speaker 1: a snow cone machine. He was on primetime TV every
• 13:04
  Speaker 1: week forever in a set which, by the way, is
• 13:07
  Speaker 1: now the location of the campaign headquarters set. It's all
• 13:10
  Speaker 1: this new kind of politics where pop cultures crossed over.
• 13:13
  Speaker 1: But that created the identity where he was this super
• 13:15
  Speaker 1: business guy on television. Can do fire him? That persona.
• 13:20
  Speaker 1: He was ratings. It is the news business, so he
• 13:22
  Speaker 1: got more attention than anybody and that grievance formula, which
• 13:26
  Speaker 1: Jeff Bush would never go to do because one that
• 13:31
  Speaker 1: he believes in, and Jeb knew that Trump's gonna lose
• 13:34
  Speaker 1: the general election. You know, the worst thing you want
• 13:36
  Speaker 1: is to have a primary which is a drunken vendor.
• 13:39
  Speaker 1: We wake up the next morning, you're blown a presidential election.
• 13:41
  Speaker 1: And that's what I believe we've done. So the parallels
• 13:45
  Speaker 1: between sixteen are are similar. Nobody really gave Trump a
• 13:50
  Speaker 1: shot in He went not all the not not that
• 13:54
  Speaker 1: very deep into the process, got a lot of brand recognition,
• 13:58
  Speaker 1: capitalized it, and by some analyzes, the bulk of his
• 14:02
  Speaker 1: fortune came about post People will argue about that. But
• 14:07
  Speaker 1: what made this primary so different? And to be to
• 14:12
  Speaker 1: be blunt, I thought the run of folks other than
• 14:18
  Speaker 1: Mitt Romney was far crazier than this run of folks.
• 14:22
  Speaker 1: I mean, you had just that was not me, but
• 14:25
  Speaker 1: other people have called it a clown car, and it
• 14:28
  Speaker 1: was apparent, at least to some observers that Mitt Romney
• 14:32
  Speaker 1: was going to come out of that ahead. We didn't
• 14:35
  Speaker 1: quite have the same dynamic happen this. No, by the
• 14:37
  Speaker 1: traditional yardstick of folks who have done stuff, we had
• 14:40
  Speaker 1: a very heavy field. We had some big governors as
• 14:45
  Speaker 1: opposed to last time. We I think Romney is a
• 14:47
  Speaker 1: very serious guy did as governor's race, but there were
• 14:51
  Speaker 1: also some sideshow acts running. This time. It was the
• 14:55
  Speaker 1: candidates weren't as crazy, but the voters decided in the
• 14:58
  Speaker 1: Republican primary to be crazier. And you can see it
• 15:01
  Speaker 1: on the Democratic side too with Bernie. There is such
• 15:03
  Speaker 1: a populace football going on in the country. The middle
• 15:06
  Speaker 1: class hasn't gotten a raise in real wages in a
• 15:08
  Speaker 1: long long time, and people have been mad at the
• 15:11
  Speaker 1: political system. Now for a decade. They're fed up. They
• 15:13
  Speaker 1: want to blow the whole thing up. I did Schwarzeninger's
• 15:16
  Speaker 1: campaign for governor of California, and I remember Sacramento in
• 15:19
  Speaker 1: that race for governor, when the voters of a Democratic
• 15:22
  Speaker 1: state reached in and yanked out the guy they just
• 15:24
  Speaker 1: elected and threw him out the window in a recall election.
• 15:27
  Speaker 1: Was the same kind of anger. The difference is Arnold
• 15:30
  Speaker 1: took the job really seriously. He got the best policy
• 15:33
  Speaker 1: people he could, starting with Warren Buffett, to work on
• 15:35
  Speaker 1: a big plan for what to do when he was governor.
• 15:38
  Speaker 1: That that's not Trump, He's pure seat of the pants,
• 15:40
  Speaker 1: you know. But people's the same. People look at Donald
• 15:44
  Speaker 1: as if he's just a big dumb actor, but he's not.
• 15:46
  Speaker 1: He's a smart guy. He's a savvy businessman. He owns
• 15:50
  Speaker 1: a ton of real estate. I'm not surprised that he
• 15:54
  Speaker 1: did exactly what you said in in California. In trude,
• 15:58
  Speaker 1: he's a planner. Arnold's always thinking out what's around the
• 16:00
  Speaker 1: corn a few steps ahead. Now, it's not a surprise
• 16:03
  Speaker 1: that in the midst of the financial crisis, um the
• 16:08
  Speaker 1: public didn't have much of an appetite for a private
• 16:10
  Speaker 1: equity guy. But what do we think about in you
• 16:16
  Speaker 1: have a career politician on one hand, and then you
• 16:19
  Speaker 1: have kind of a renegade on the other. Which way
• 16:22
  Speaker 1: is the public going to break? Well? The force that
• 16:25
  Speaker 1: pushes Trump forward is what we political types called the
• 16:28
  Speaker 1: wrong track, which is two thirds or more of the
• 16:30
  Speaker 1: people think the country is off on the wrong track.
• 16:32
  Speaker 1: That means the election is going to be about new change,
• 16:35
  Speaker 1: blow up the system, and that is the win that
• 16:37
  Speaker 1: Trump can harness. Hillary is stuck being politics for forty years.
• 16:41
  Speaker 1: She's a pre aware title to everybody knows who Hillary
• 16:44
  Speaker 1: Clinton has, They have for decades, but she represents, oh
• 16:47
  Speaker 1: my god, the old politics now the countervailing force. Though.
• 16:50
  Speaker 1: One is Trump's weaknesses. Trump's got a lot of Trump
• 16:53
  Speaker 1: driven problems. He ran a campaign designed to offend swing
• 16:56
  Speaker 1: voters that he needs to win the general election. It's
• 16:58
  Speaker 1: like he was building a lab to lose the like
• 17:00
  Speaker 1: they had strategy. The other problem Trump has his demography,
• 17:04
  Speaker 1: the election scale in the general election, those million people
• 17:07
  Speaker 1: is increasingly a much more democratic group than it used
• 17:10
  Speaker 1: to be. Of the voters will be minority voters and black, Latino,
• 17:15
  Speaker 1: Asian or mixed race among that group, Trump right now
• 17:18
  Speaker 1: is losing by essentially infinity. So he's written off almost
• 17:22
  Speaker 1: thirty percent of the vote, percent of which will probably
• 17:26
  Speaker 1: go to Hillary, maybe more so. Let me ask you
• 17:28
  Speaker 1: this question on that exact topic. So if you had
• 17:33
  Speaker 1: to come up with a percentage that we start with
• 17:35
  Speaker 1: the electoral college map and we look at everybody who
• 17:38
  Speaker 1: went out and voted for Romney. What percentage of Mitt
• 17:42
  Speaker 1: Romney voters are just gonna say, I'm not gonna pull
• 17:45
  Speaker 1: the leave of Hillary, but I can't go vote for
• 17:48
  Speaker 1: this guy. What percentage of Romney voters stay at home? Well,
• 17:53
  Speaker 1: I don't know about stay at home because there are
• 17:55
  Speaker 1: other places they can go. We got the Libertarians. They vote,
• 17:59
  Speaker 1: but they don't vote in the presidential They vote down
• 18:01
  Speaker 1: ballot center races or house. But let me put it
• 18:04
  Speaker 1: this way. I think Trump will lose at least ten
• 18:07
  Speaker 1: percent of the people who pulled the lever for Romney.
• 18:10
  Speaker 1: And that's that's something like fifty million. Yeah, it's a
• 18:17
  Speaker 1: couple of million people put it that way, less than
• 18:19
  Speaker 1: what Romney's fifty But he may bring in some people
• 18:23
  Speaker 1: Romney didn't have to, you know. So there are two
• 18:25
  Speaker 1: numbers there. But fundamentally, if you look at this polling,
• 18:28
  Speaker 1: and there's constantly panic about polling because the media business
• 18:32
  Speaker 1: has to cover for eyeballs every day of the election,
• 18:35
  Speaker 1: like it's the Hannenburg explosion. No matter what happens, it's
• 18:38
  Speaker 1: the biggest thing in the world. We only hear about
• 18:40
  Speaker 1: that one outlier poll, not day sirens go off because
• 18:45
  Speaker 1: they need the daily heat. That's where the clicks and
• 18:47
  Speaker 1: eyeballs come from. So they're in business too. So, But
• 18:50
  Speaker 1: if you look at the last thirty days of the polling,
• 18:52
  Speaker 1: give or take a day, and you average it all together,
• 18:55
  Speaker 1: which real clear Politics dot Com will do. The Trump
• 18:58
  Speaker 1: number has basically been forty two, forty one, forty two,
• 19:04
  Speaker 1: forty two, forty three, forty two, forty three times five.
• 19:10
  Speaker 1: He's been stuck down there because he's in this demographic
• 19:12
  Speaker 1: called to sack, where he's not getting what he ought to.
• 19:14
  Speaker 1: If college get white people, which Republicans normally win, Ronnie
• 19:18
  Speaker 1: won him by fourteen points, Democrat has not the Democrat
• 19:22
  Speaker 1: in a presidential election has not one white college educated males.
• 19:26
  Speaker 1: And I don't know how many decades, right, And so
• 19:29
  Speaker 1: he's in trouble there, particularly I white college educated women,
• 19:31
  Speaker 1: who really are the most powerful swing vote. He's doing
• 19:34
  Speaker 1: great with blue collar white guys, he's increasingly write a
• 19:39
  Speaker 1: shrinking pool, and he's getting murdered by the thirty percent
• 19:42
  Speaker 1: that's minority. So Trump is stuck in this low forties
• 19:45
  Speaker 1: called the sack of demography. The reason the race looks
• 19:48
  Speaker 1: close is one the media only covers horse race forty
• 19:50
  Speaker 1: two forty two, Well forty two forty two is the
• 19:53
  Speaker 1: voters saying, we hate both these guys because a bag
• 19:56
  Speaker 1: of cement can get forty with a D on it,
• 19:59
  Speaker 1: and a bag of some with an hour on it
• 20:00
  Speaker 1: will get thirty nine So the question is the difference
• 20:03
  Speaker 1: between hillary is forty two and forty nine or Trump's
• 20:07
  Speaker 1: forty two and forty nine or fifty. Who are those people? Well,
• 20:10
  Speaker 1: they look a lot more like democratle in voters than Republican.
• 20:14
  Speaker 1: So the real action of this race has been Hillary
• 20:17
  Speaker 1: going from the high forties and oh she's way ahead,
• 20:20
  Speaker 1: to Hillary doing something stupid or having a bad when
• 20:24
  Speaker 1: they when they keep it a stage secret, the moment
• 20:26
  Speaker 1: is suddenly the new nuclear code. You can't tell anybody
• 20:29
  Speaker 1: for seven hours after you face planting to the Scooby
• 20:31
  Speaker 1: do van there on television Country. It's insane. But they
• 20:35
  Speaker 1: get in trouble and the polls are basically a noise
• 20:37
  Speaker 1: meter what was on cable TV forties, So they ticked down.
• 20:41
  Speaker 1: So there's kind of a vix of polling going on.
• 20:43
  Speaker 1: It's mostly Hillary moving around. Trump's creeped up from forty
• 20:46
  Speaker 1: one to forty three, but he's running out of voters,
• 20:50
  Speaker 1: and give him time, he'll find a way to he'll
• 20:52
  Speaker 1: offend him again, like again today in the news cycle,
• 20:54
  Speaker 1: he's out, you know, attacking more people and the birth thing.
• 20:58
  Speaker 1: I can't believe that I thought that was behind us.
• 21:01
  Speaker 1: I'm astonished that came up again. Is I think working
• 21:03
  Speaker 1: on something today where he's going to try to get
• 21:05
  Speaker 1: out of it, but you know, he gets out of it,
• 21:07
  Speaker 1: then he gets back in it, so he can't help himself. Yeah.
• 21:10
  Speaker 1: The question is can Hillary fix herself just to get
• 21:12
  Speaker 1: to her generic number and that's enough for her to win?
• 21:15
  Speaker 1: She would win because the generic number for them is
• 21:17
  Speaker 1: bigger than ours. Now. I'm Barry rid Hilts. You're listening
• 21:20
  Speaker 1: to Master's in Business on Bloomberg Radio. My special guest
• 21:23
  Speaker 1: today is GOP campaign strategist extraordinaire Michael Murphy. He has
• 21:29
  Speaker 1: advised pretty much everyone on the GOP side, from Jeb
• 21:33
  Speaker 1: Bush to the Governator Arnold Schwarzenegger, uh to Mitt Romney
• 21:38
  Speaker 1: to uh Um McCain. You were big with McCain in
• 21:42
  Speaker 1: two thousand. I did the two thousand campaign. I didn't
• 21:45
  Speaker 1: do two thousand and eight, and fermid I did the
• 21:47
  Speaker 1: governor's race. People always hear my bio and say, so,
• 21:49
  Speaker 1: you're the idiot. No. No, I did the Straight Talk Express,
• 21:52
  Speaker 1: which did lose. But boy do we have fun. Let
• 21:54
  Speaker 1: me ask you a so. So, I'm an odd political
• 21:59
  Speaker 1: duck growing up in New York Jacob Javits Republican, socially progressive,
• 22:04
  Speaker 1: fiscally conservative. I loved the two thousand John McCain holy
• 22:10
  Speaker 1: unimpressed with George W. Bush. Here's a guy telling the truth,
• 22:13
  Speaker 1: the straight shooter he was. And then in oh eight
• 22:16
  Speaker 1: that guy disappeared. What what happened? Well, I think he
• 22:20
  Speaker 1: was the same guy, but he made the tough decision
• 22:23
  Speaker 1: that everybody in politics eventually has to make because it's
• 22:26
  Speaker 1: a tough bracket and it is boy, I'd actually like
• 22:30
  Speaker 1: to win the election so I can do some of
• 22:31
  Speaker 1: this good stuff I believe in because he's the same guy.
• 22:34
  Speaker 1: And now I've got to be the standard bearer of
• 22:36
  Speaker 1: the party. Last time I got to run against the
• 22:38
  Speaker 1: party and we had fun, met girls, drove around the
• 22:40
  Speaker 1: country and a bus. It was fantastic and we almost
• 22:42
  Speaker 1: stole the election. You know, we had it. We were
• 22:45
  Speaker 1: halfway out of the bank and there were just a
• 22:46
  Speaker 1: few too many cops. The second time, we tried the robbery.
• 22:49
  Speaker 1: Maybe we actually try to get out with the cash.
• 22:52
  Speaker 1: And so when John ran the second time, he ran
• 22:54
  Speaker 1: a little bit more of a traditional Republican campaign, and
• 22:56
  Speaker 1: guess what, he won the nomination. But it was not
• 22:59
  Speaker 1: enough to win general election. And I think one thing
• 23:01
  Speaker 1: that hurt him a bit in the general was he'd
• 23:03
  Speaker 1: lost a little of that appeal. He had to cross
• 23:05
  Speaker 1: over voters so much a part of what we didn't
• 23:08
  Speaker 1: he lost that The financial crisis tied him up. That
• 23:11
  Speaker 1: was really there was the lets us suspend our campaign
• 23:14
  Speaker 1: and rethink this and that that. That was the point
• 23:16
  Speaker 1: where it's pretty much and he was up against history
• 23:19
  Speaker 1: of Barack Obama. The fact is the media love McCain.
• 23:21
  Speaker 1: I used to joke the media was our base. But
• 23:24
  Speaker 1: what the media really wants is a Republican murder boy.
• 23:27
  Speaker 1: He gave it to him and then they beheaded him.
• 23:29
  Speaker 1: So who's the Democrat we're gonna be for? My personal thesis,
• 23:32
  Speaker 1: isn't The Iraq War was going bad. The financial crisis
• 23:35
  Speaker 1: was a disaster. As long as as the Democrats put
• 23:39
  Speaker 1: somebody up who could form go here in sentences, it
• 23:43
  Speaker 1: was their race to lose. That was a really uphill
• 23:45
  Speaker 1: battle and the phenomena I'll never forget. You know, I'm
• 23:49
  Speaker 1: still close to Mccainny's a great America and suppressive people
• 23:51
  Speaker 1: I ever met, and I went and visited him. You like,
• 23:53
  Speaker 1: it's okay that he was captured. You were write with that, Yeah,
• 23:56
  Speaker 1: I'm and I know, I know a lot of details.
• 23:58
  Speaker 1: I met some of the guys who were in the
• 24:00
  Speaker 1: Annoy Hilton with them, or I stayed in a hotel
• 24:03
  Speaker 1: ones where they don't leave a mint on the pillow. Well,
• 24:06
  Speaker 1: Donald Trump, you know, I mean the deferments a lot.
• 24:10
  Speaker 1: I could go on for It's just discussed me. So
• 24:13
  Speaker 1: let me ask you. Let me take off my independent
• 24:15
  Speaker 1: hat and put on a Democrat had for a second, Hey,
• 24:18
  Speaker 1: how much of this is just karma coming back from
• 24:21
  Speaker 1: the swift boat debacle? Is this? Can you really complain
• 24:26
  Speaker 1: about that? And I remember McCain defending Kerry, to his credit,
• 24:31
  Speaker 1: was not a fan of the swift boat stuff. But
• 24:34
  Speaker 1: the party apparatus that approved the swift boat is it
• 24:39
  Speaker 1: a surprise that it devolved into this? Well, I don't know.
• 24:42
  Speaker 1: I'm never a big believer in pulling the sweater thread
• 24:45
  Speaker 1: of one pain thing because then I got to go
• 24:47
  Speaker 1: back to LBJ using an H bomb to terrify the
• 24:50
  Speaker 1: country about Verry Goldwater. So I do think the political
• 24:55
  Speaker 1: culture has gotten courser, but Trump is an outlier. Trump
• 24:58
  Speaker 1: is breaking rules a sec civility let alone the truth.
• 25:01
  Speaker 1: He is the fact check meters in the in the
• 25:03
  Speaker 1: press have exploded. He broke the machine. How do you
• 25:06
  Speaker 1: fact check the person who is an outlier? And everything's
• 25:12
  Speaker 1: a pivot. He's a Republican one day he's a conservative,
• 25:14
  Speaker 1: than he's a liberal. He goes. I mean, he doesn't
• 25:16
  Speaker 1: believe in anything, Like a good con man, he's just
• 25:18
  Speaker 1: trying to get the room. Are you suggesting that he's
• 25:21
  Speaker 1: a grifter? Is that? Is that what I'm hearing from.
• 25:24
  Speaker 1: I can't say he's a grifter, but I think he
• 25:25
  Speaker 1: has griffish tendencies. Griffish tendencies. All right, we'll see if
• 25:29
  Speaker 1: that that makes it into the campaign. So let's talk
• 25:31
  Speaker 1: a little bit about the Jeb campaign. How surprising, I mean,
• 25:37
  Speaker 1: it looked like this was battle of the dynasty's, it
• 25:39
  Speaker 1: was gonna be Hillary versus Jeb. How much of this
• 25:43
  Speaker 1: was just the forces you talked about earlier, that it
• 25:46
  Speaker 1: was the anti incumbent, and how much of this was
• 25:49
  Speaker 1: he just was rusting and off his game. Well, the
• 25:52
  Speaker 1: voters are always more important than the campaigns because they
• 25:55
  Speaker 1: decide what they want and they go find it, and
• 25:57
  Speaker 1: often what they find takes a while. So they can
• 26:00
  Speaker 1: land on somebody, and then of course everybody's shocked and
• 26:02
  Speaker 1: amazed at what happened. But it was clear it was
• 26:05
  Speaker 1: going to be a grievance primary. And one of the
• 26:07
  Speaker 1: great secrets of the Jeb political operation is we were
• 26:10
  Speaker 1: bluffing a little bit in terms of what we knew
• 26:13
  Speaker 1: how hard the Republican primary would be. Positive candidate like Jeb. Yeah,
• 26:18
  Speaker 1: but you don't run a campaign saying, hey, guess what
• 26:20
  Speaker 1: we think it's really gonna be uphill. You run a
• 26:23
  Speaker 1: campaign saying we've raised the most money, we have the
• 26:24
  Speaker 1: most qualified guy be for what's gonna happen. We're trying
• 26:28
  Speaker 1: to muscle Rubio out k sake others. That was the strategy,
• 26:32
  Speaker 1: because you don't leave off your weaknesses. But internally, I'll
• 26:34
  Speaker 1: never forget. I had dinner with Jeb and Sally Bradshaw,
• 26:38
  Speaker 1: who's Jeb's other longtime political person, a dear friend of mine,
• 26:42
  Speaker 1: and his son and I will go into a private conversation,
• 26:45
  Speaker 1: but we all did the odds of winning. Early on
• 26:49
  Speaker 1: when we're thinking about this, and the guy who had
• 26:51
  Speaker 1: the lowest number at the table and none of us
• 26:52
  Speaker 1: were over fifty percent Jet and we said well, then
• 26:56
  Speaker 1: I have an idea. Why don't we order another round
• 26:57
  Speaker 1: of drinks and not run for president? And Jeff said,
• 27:00
  Speaker 1: I I don't do it if I don't try to
• 27:01
  Speaker 1: run the kind of modern conservatism that can win the
• 27:04
  Speaker 1: general election, get power to change the country with our policies,
• 27:08
  Speaker 1: to lift everybody up. That's why we called it right
• 27:09
  Speaker 1: to rise. Who will? I know, it's a long chatter.
• 27:12
  Speaker 1: Who will fight the good fight. We're gonna get cruise otherwise,
• 27:15
  Speaker 1: or you know, we'll get another grievance. Candidate Trump wasn't
• 27:18
  Speaker 1: around at that, so no one really was thinking, Oh,
• 27:20
  Speaker 1: Trump is the guy that's gonna Trump wasn't on the radar. Then.
• 27:23
  Speaker 1: We were much more worried about We're worried about the
• 27:26
  Speaker 1: kind of forces in the party that picked Trump in
• 27:28
  Speaker 1: the end. But we thought they'd grab on the cruise
• 27:31
  Speaker 1: and we'd run a grievance campaign the Republican Party and
• 27:34
  Speaker 1: we'd blow the general election. We'd hand the White House
• 27:36
  Speaker 1: to Hillary Clinton, who's eminently beautiful, and we set the
• 27:38
  Speaker 1: party way back at a time when we needed the
• 27:40
  Speaker 1: opposite and the country needed our ideas, at least our
• 27:43
  Speaker 1: Bush conservative ideas, which is about fixing a lot of
• 27:46
  Speaker 1: things that don't work in the country with free markets
• 27:48
  Speaker 1: and other things we believe in. So we always knew
• 27:51
  Speaker 1: it was more of a crazy long shot and anybody thought,
• 27:53
  Speaker 1: but we can never say that publicly because it would
• 27:55
  Speaker 1: undermine our attempt to muscle our way through. Now that's
• 27:59
  Speaker 1: ad Jeb, if he were here, would be the first
• 28:00
  Speaker 1: to say I was rusty out of the box. He was.
• 28:03
  Speaker 1: I was not in perfect candidate shape, not at all.
• 28:06
  Speaker 1: But I mean people say, well, would you have done
• 28:08
  Speaker 1: anything different? Because I can think of a hundred things
• 28:10
  Speaker 1: we would have done different and we would have lost differently.
• 28:12
  Speaker 1: You know, it's weird. I'm in a business where you
• 28:15
  Speaker 1: live by winning and losing, and I've been spoiled. I
• 28:18
  Speaker 1: want a ton of campaigns over here. Had some losses.
• 28:20
  Speaker 1: Like everybody, you learn a lot in your losses. You
• 28:22
  Speaker 1: actually learn more than you're doing. We're the same is
• 28:24
  Speaker 1: true in the world investing you and you you walk
• 28:27
  Speaker 1: into a casino, you win, Hey, you're a genius. When
• 28:30
  Speaker 1: you walk out, you lose. It requires a very different
• 28:33
  Speaker 1: bit of self reflection. But I can tell you the
• 28:36
  Speaker 1: Jeb folks, even though we had the resources, thank God
• 28:39
  Speaker 1: for that Jeb worked very hard. The finance people did.
• 28:41
  Speaker 1: We had a great team, many of them here in
• 28:43
  Speaker 1: New York, so we had the dollars to make our case,
• 28:46
  Speaker 1: but they were not buying what we were selling. So
• 28:48
  Speaker 1: weirdly enough, even though we all hate losing, believe me
• 28:52
  Speaker 1: so pathologically, we sleep pretty well because there's nothing Jeb
• 28:56
  Speaker 1: Bush did in that campaign we have to apologize. He
• 28:58
  Speaker 1: ran an honorable campaign. He out out at the appropriate moment,
• 29:01
  Speaker 1: even overstay. Uh, there's not a lot of things you
• 29:04
  Speaker 1: can really We weren't other than Mexican rapists. We weren't
• 29:07
  Speaker 1: lying to people. Trump's tried to steal our immigration plan
• 29:11
  Speaker 1: on days when he's four immigration reform, which is about
• 29:13
  Speaker 1: one out of three. Um, you know, so fought our corner,
• 29:17
  Speaker 1: fought it hard, worked like dogs, Jeb in particular, and
• 29:20
  Speaker 1: guess what we lost. Life will go on. But if,
• 29:23
  Speaker 1: as I think the numbers are gonna show that Hillary
• 29:26
  Speaker 1: Clinton will be sworn in as the next president, you know,
• 29:28
  Speaker 1: am I gonna be saying I told you saw a
• 29:30
  Speaker 1: little damn right. So let me ask you three questions
• 29:33
  Speaker 1: about Jeb that really stood out. The first was very
• 29:37
  Speaker 1: surprised that he was seemingly unprepared for a question about
• 29:43
  Speaker 1: his brother's administration the Iraq War. That that kind of
• 29:48
  Speaker 1: surprised me that that wasn't off the tip of his
• 29:51
  Speaker 1: um head, the top of his head, tip of his fingers.
• 29:53
  Speaker 1: Did did you? I know you weren't working directly with
• 29:57
  Speaker 1: the kids around them. That was before I went to
• 29:59
  Speaker 1: the super That was a situation where we all knew
• 30:03
  Speaker 1: from minute one what the answer the press wanted to
• 30:06
  Speaker 1: hear to say. He's quote answered it right, you know,
• 30:08
  Speaker 1: because the press it was the worst thing ever. And
• 30:11
  Speaker 1: you know the problem is, like a lot of governors,
• 30:16
  Speaker 1: Jeb had written a lot of letters, made a lot
• 30:17
  Speaker 1: of phone call the people that their loved ones killed
• 30:19
  Speaker 1: in action fighting for our country. And he wasn't in
• 30:21
  Speaker 1: a big hurry to say yeah, it didn't mean anything.
• 30:24
  Speaker 1: And so he again what would make him a great
• 30:28
  Speaker 1: president but did not always make him the perfect machine
• 30:30
  Speaker 1: tool candidate. Was he pushed back for a few days
• 30:33
  Speaker 1: that he didn't want to like run to Berry the
• 30:36
  Speaker 1: sacrifice of people by trying to separate that from just
• 30:39
  Speaker 1: the policy mistakes that were made. And he did say
• 30:41
  Speaker 1: policy mistakes were made, but he didn't leap to it
• 30:44
  Speaker 1: with glee the way the media narrative would like. So
• 30:46
  Speaker 1: what does that mean? It means you get scored his
• 30:48
  Speaker 1: bumbling idiot for four days by the process press, the
• 30:51
  Speaker 1: same people who are hyper ventilating today about polling data
• 30:54
  Speaker 1: as Trump becomes the president of September eighteen. You know,
• 30:58
  Speaker 1: so again I draw analogy to the business world. There
• 31:00
  Speaker 1: is a lot like value investing and the daily panic,
• 31:05
  Speaker 1: the daily herd is something you have to resist strategically,
• 31:09
  Speaker 1: but it rules the press. So it's a voting machine
• 31:11
  Speaker 1: short term and a wing machine long term. Yeah, and
• 31:13
  Speaker 1: if you can figure out the net asset value of
• 31:15
  Speaker 1: an electorate, you're going to do well. So second question
• 31:18
  Speaker 1: related to the Jib primary. Donald Trump comes out and
• 31:25
  Speaker 1: Jeb says, well, you know, my brother kept the country safe.
• 31:29
  Speaker 1: And then Donald Trump comes out with what is not
• 31:33
  Speaker 1: just a democratic talking point, but a far left talking point.
• 31:37
  Speaker 1: September eleventh happened on your brother's watch. You your brothern
• 31:40
  Speaker 1: keep the country safe. I'm in New York and three
• 31:44
  Speaker 1: thousand people died. That's unheard of amongst Republicans. And what
• 31:49
  Speaker 1: was the reaction to that. Well, in the room where
• 31:51
  Speaker 1: it happened, he was roundly boot Trump was you know,
• 31:53
  Speaker 1: he was in the debate. Yeah, yeah, and we you know,
• 31:56
  Speaker 1: a contributions surged, all the normal stuff. Really, but again
• 32:00
  Speaker 1: Trump Trump was the creature at the beginning of about
• 32:04
  Speaker 1: the primary electorate, and then it grew to the mid
• 32:06
  Speaker 1: thirties and they were ready. I mean, we tested all
• 32:09
  Speaker 1: this stuff. We do polls and focus groups of Trump
• 32:12
  Speaker 1: voters and they were locked in. They were like, what
• 32:15
  Speaker 1: he said. I mean, the GOP candidate has never said
• 32:18
  Speaker 1: anything like that. Yeah, but he was not. And this
• 32:19
  Speaker 1: was the big surprise to those of us because the
• 32:21
  Speaker 1: last thousand times you've done a campaign, the ideological primary
• 32:25
  Speaker 1: voters vote ideology, and you know, Trump could be wearing
• 32:28
  Speaker 1: a Carl Marks suit and the pent that he really had.
• 32:32
  Speaker 1: They wouldn't go anywhere. They're like, look, he's my guy.
• 32:35
  Speaker 1: He gets the issue, and then you feel the race
• 32:38
  Speaker 1: in the room. They would not quite say it, but
• 32:40
  Speaker 1: the whole thing was he knows what the problem is,
• 32:42
  Speaker 1: if you know what I mean, wink wink. So I
• 32:45
  Speaker 1: don't care what you fancy pants college jerk say about
• 32:48
  Speaker 1: him with your whatever you said n. Eighty nine. He's
• 32:52
  Speaker 1: my guy. Screw you. And you know, maybe some of
• 32:54
  Speaker 1: you guys will get thrown in the camps. I mean
• 32:56
  Speaker 1: it was rough. There's some rough voters out there in Trump. Now.
• 33:00
  Speaker 1: He came out and said I could shoot someone a
• 33:01
  Speaker 1: fifth Avenue and my people are still gonna support me.
• 33:04
  Speaker 1: That that's you're saying, that's true, and that was the
• 33:07
  Speaker 1: core of the core. I want to be fair to
• 33:08
  Speaker 1: most Trump voters here. I don't. I blame the con man,
• 33:11
  Speaker 1: not the marks. I think there are a lot of
• 33:13
  Speaker 1: people who are for Trump. The vast majority love the
• 33:16
  Speaker 1: country and really think he is a way to change
• 33:18
  Speaker 1: it for the better. But back in those primary days,
• 33:20
  Speaker 1: at the beginning, there was some rough elements in that world,
• 33:24
  Speaker 1: and they were ready to take almost any rhetoric from Trump,
• 33:27
  Speaker 1: and some of them really loved the roughest rhetoric about
• 33:31
  Speaker 1: the Mexican rapist coming in and all that that was.
• 33:33
  Speaker 1: That's yeah. So the last Trump related question with Jeb
• 33:38
  Speaker 1: um he has a aside from the fact that he's
• 33:42
  Speaker 1: a talented television presence and personality, he has a way
• 33:47
  Speaker 1: of crazy Bernie Crooked Hillary, little little Marco lion ted
• 33:54
  Speaker 1: and he came at Jeb with low energy. What was
• 33:59
  Speaker 1: the reaction to that, because Jeb stands up there and
• 34:02
  Speaker 1: you're not supposed to be doing a dance at the podium.
• 34:05
  Speaker 1: You're supposed to be articulating intelligent policy positions. What was
• 34:10
  Speaker 1: a code word? You know? I was screaming at the TV.
• 34:12
  Speaker 1: I couldn't talk to the campaign. But how about needy Donald,
• 34:15
  Speaker 1: you know, because there's no needy or political life the
• 34:21
  Speaker 1: low energy Jeb one. People who know Jeb all went
• 34:24
  Speaker 1: nuts because he's He's not a low energy guy. If
• 34:26
  Speaker 1: Trump was on Jeb schedule for two days during the primary,
• 34:29
  Speaker 1: Trump would be in the hospital. Um the But he's
• 34:32
  Speaker 1: the healthiest presidential candidate ever, and he's the energizer bunny.
• 34:37
  Speaker 1: He used to the year old staff couldn't keep up
• 34:39
  Speaker 1: with him the workload when he was governor. But it
• 34:41
  Speaker 1: wasn't about low energy. That was a code word for
• 34:44
  Speaker 1: smarty pants talking with the big words. When I'm going
• 34:47
  Speaker 1: to tell you what's really going on, Mexican rapists are
• 34:49
  Speaker 1: coming over the border. What Jeb's talking about, Well, it's
• 34:51
  Speaker 1: an act of love, frankly, when they come into the
• 34:53
  Speaker 1: country to try to get their families a life as
• 34:55
  Speaker 1: an American. Jeb. Jeb was civil and polite, and that
• 34:58
  Speaker 1: was a code for low energy with with Spanish members
• 35:01
  Speaker 1: of his families. Of course he's going to push back.
• 35:05
  Speaker 1: So that that was that was Trump's code for other
• 35:09
  Speaker 1: jeb uses big words, and you know he's not he
• 35:13
  Speaker 1: doesn't have my grievance anger, and so it really meant
• 35:19
  Speaker 1: polite and thoughtful, which was frankly not what fort pent
• 35:22
  Speaker 1: of the primary wanted this year. I jokeer was like
• 35:25
  Speaker 1: selling opera records that attractor poll. They just weren't buying it.
• 35:28
  Speaker 1: And it's too bad because of jebb or nominee right now,
• 35:30
  Speaker 1: or I'll say, in fairness case sake, we'd be up
• 35:33
  Speaker 1: three or four in Hillary on our way to win
• 35:35
  Speaker 1: the election and probably get the center reelected. I'm Barry
• 35:37
  Speaker 1: rid Hults. You're listening to Masters in Business on Bloomberg Radio.
• 35:41
  Speaker 1: My special guest today is Michael Murphy. He is a
• 35:44
  Speaker 1: Republican political consultant, most recently known for the Right to
• 35:49
  Speaker 1: Rise Superpack. He has advised Jeb Bush, Mitt Romney, Arnold Schwarzenegger,
• 35:57
  Speaker 1: John McCain, and now runs the fabulous podcasts called Radio
• 36:01
  Speaker 1: Free GP. Radio Free GP. You can find that on
• 36:04
  Speaker 1: iTunes and pretty much all the usual places so so
• 36:07
  Speaker 1: let's jump right in to the to the general election.
• 36:12
  Speaker 1: What what does the Trump campaign mean for future elections
• 36:18
  Speaker 1: and non politicians. Well, we have It's interesting because we
• 36:21
  Speaker 1: have this crossover now pop culture into politics. We had
• 36:25
  Speaker 1: a little bit of Arnold back into that shore in California,
• 36:27
  Speaker 1: but this is a whole new level. I'm terrified at
• 36:30
  Speaker 1: Kardashian right now is looking at a map of New Hampshire.
• 36:32
  Speaker 1: But then we have We've had Sonny Bono, We've had athletes,
• 36:36
  Speaker 1: we've had the guy from George back when Ronald Reagan
• 36:40
  Speaker 1: was an actor originally, so oh, of course that's the
• 36:43
  Speaker 1: ultimate pop crossover, right exactly. Actually did the campaign in
• 36:46
  Speaker 1: the primary against Fred Grandy, who was from The Love Body,
• 36:49
  Speaker 1: ran for governor and I'll never get poor Fred. We
• 36:52
  Speaker 1: ran a radio campaign when we found out he'd been
• 36:55
  Speaker 1: a liberal Democrat in Hollywood. Fred Grandy, he may be
• 36:57
  Speaker 1: a better actor, and we think so. The actor thing
• 37:00
  Speaker 1: actually became an issue in that primary where we have
• 37:03
  Speaker 1: to beat him of Governor Brandstead, but he was a
• 37:05
  Speaker 1: pretty distinguished Republican congressman for a long time. I do
• 37:08
  Speaker 1: think we're going to see more crossover and there will
• 37:11
  Speaker 1: be kind of Trump imitators, but it's hard to imitate
• 37:14
  Speaker 1: Trump one he is so preaware and so famous and
• 37:18
  Speaker 1: to his blustering style, which both helps him by attracting
• 37:21
  Speaker 1: attention and hurts him by offending voters he desperately needs
• 37:25
  Speaker 1: to win a general election. Is a hard thing to replicate.
• 37:28
  Speaker 1: But he has put his claw print on this, no
• 37:31
  Speaker 1: doubt about it, and it will be felt in the future.
• 37:33
  Speaker 1: So you've worked with with the media and through the media.
• 37:38
  Speaker 1: What is the media circus of a presidential campaign? Like,
• 37:41
  Speaker 1: what what does the average listener at home not know
• 37:45
  Speaker 1: about this? This mayhem um that it's a big mob
• 37:48
  Speaker 1: that watches itself. So there's a huge herd mentality, and
• 37:52
  Speaker 1: it's running against a clock of now now now, because
• 37:56
  Speaker 1: with digital media has changed. Is the old days where
• 37:58
  Speaker 1: he had the deadline at night and then the payper
• 38:00
  Speaker 1: and now the new cycle is instantaneous Twitter, you know
• 38:03
  Speaker 1: the various social media platforms. It never ends. So they
• 38:06
  Speaker 1: they are like a herd of buffalo running looking one
• 38:10
  Speaker 1: ft ahead, just just watching each other, thundering towards anything.
• 38:14
  Speaker 1: The old joke I used to tell, which is kind
• 38:16
  Speaker 1: of unfair to my friends in the media, is They're
• 38:18
  Speaker 1: kind of like the Jurassic Park dinosaur there, forty ft tall,
• 38:21
  Speaker 1: five ft teeth and a brain about the size of
• 38:25
  Speaker 1: a grapefruit. And when they see movement, they want to
• 38:28
  Speaker 1: go sniff it and eat it. So when something happens
• 38:31
  Speaker 1: in the campaign, they see his movement, you know, this
• 38:33
  Speaker 1: herd of Jurassic Park dinosaurs, they thunder over and probably
• 38:36
  Speaker 1: destroy whatever it is with investigation. So whatever the movement
• 38:41
  Speaker 1: of the day is, be at the candidate falling in
• 38:43
  Speaker 1: an orchestra pit, or Trump trade, some phony trip to Mexico. Uh,
• 38:48
  Speaker 1: they thunder and cover the hell out of it, because
• 38:51
  Speaker 1: every day has to be a big day to go now.
• 38:54
  Speaker 1: To give them some credit, there are stronger, more important
• 38:58
  Speaker 1: themes and analysis that does happen that kind of floats above.
• 39:02
  Speaker 1: But I would say they've been a bit flummixed by
• 39:04
  Speaker 1: Trump because the old media weapon of the raised eye
• 39:08
  Speaker 1: brow that's really not quite true, sir, That used to
• 39:10
  Speaker 1: send most people in public life to like, well I
• 39:13
  Speaker 1: I I, you know, and back off. Trump's oblivious to it.
• 39:16
  Speaker 1: He just doubles down on whatever misstatement he just made up.
• 39:20
  Speaker 1: And they haven't quite found a way to push back
• 39:22
  Speaker 1: because the mural book is they can't say that's a
• 39:24
  Speaker 1: bald faced lie. You can, man, have you noticed trained
• 39:27
  Speaker 1: not to do that. I've noticed that CNN, of all stations,
• 39:30
  Speaker 1: is running on the crawl like a real time fact check.
• 39:34
  Speaker 1: Know what he said is that that's unthinkable with any
• 39:38
  Speaker 1: other candidate. Yeah, well, it's kind of like it's the
• 39:41
  Speaker 1: World heavyweight boxing Championship and one of the boxers walks
• 39:44
  Speaker 1: in with a chainsaw and starts slicing at the other guy,
• 39:47
  Speaker 1: and the refs are saying no, and he slices the
• 39:49
  Speaker 1: ref and the crowd screaming and then stop. Yeah, it's like,
• 39:53
  Speaker 1: but wait a minute, you've just broken the rules of
• 39:55
  Speaker 1: there are no rules, and then the ratings go through
• 39:57
  Speaker 1: the roof, and maybe there are no rules. So let
• 40:00
  Speaker 1: me flip the question on you, Um, what does the
• 40:04
  Speaker 1: media get right? What sort of coverage have you seen
• 40:08
  Speaker 1: that you've said to yourself, Hey, this is really insightful.
• 40:11
  Speaker 1: They do two things really well. One, even though it
• 40:13
  Speaker 1: isn't insane heard and a lot of the analysis I
• 40:16
  Speaker 1: see on television drives me crazy against silly. They cover
• 40:22
  Speaker 1: it around the clock, wall to wall. So if you
• 40:24
  Speaker 1: want to know what kind of tie Donald Trump is
• 40:27
  Speaker 1: wearing today and the words he said just clip on
• 40:29
  Speaker 1: table TV, cable TV, or the internet. So it's you're
• 40:33
  Speaker 1: there and they use the technology and the resources they
• 40:36
  Speaker 1: have to put you in the campaign. You can actually
• 40:39
  Speaker 1: cover the campaign now without traveling really even as a journalist,
• 40:42
  Speaker 1: because it is so accessible electronically, so you have an
• 40:45
  Speaker 1: unfiltered view of the whole thing that you've got to
• 40:47
  Speaker 1: sort out. The problem is there's a lot of bad,
• 40:50
  Speaker 1: dumb analysis, but we get a level of kind of
• 40:52
  Speaker 1: transparency to what happened that day that is unheard of
• 40:56
  Speaker 1: fifteen years ago in politics even ten Who is doing
• 41:00
  Speaker 1: the sort of deep dive research that the impresses you,
• 41:03
  Speaker 1: what have you seen that? I would say that's the
• 41:05
  Speaker 1: second thing. There are some people who are old pros
• 41:08
  Speaker 1: who are writing smart political coverage with context or what's
• 41:11
  Speaker 1: really going on, not the daily trivia chase. I'm saying
• 41:14
  Speaker 1: the Prince side. Jonathan Martin at the New York Times
• 41:17
  Speaker 1: does a great job. There are others are Maggie Haberman
• 41:20
  Speaker 1: a bunch of their they do it's a left wing newspaper.
• 41:24
  Speaker 1: But the news folks covering the analysis of the campaign.
• 41:28
  Speaker 1: I think there's some strong people there the Post. There's
• 41:30
  Speaker 1: a great beat reporter who covers the charity issue. Yeah,
• 41:34
  Speaker 1: I remember his name. He's called like four How brilliant
• 41:39
  Speaker 1: is this? This guy has called like thirty charities a day.
• 41:42
  Speaker 1: Have you received any money from Donald Trump? The Post?
• 41:44
  Speaker 1: He's found one five thousand dollar donation out of a
• 41:48
  Speaker 1: great job on that. Bob Costa is a good shoe
• 41:51
  Speaker 1: leather campaign gossip. Who's fighting who in the elevator? What's
• 41:54
  Speaker 1: really going on? He's one of the few guys deep
• 41:56
  Speaker 1: sources in these the Banana Republic of the Trump campaign.
• 42:00
  Speaker 1: There's no campaign. It's a Banana Republican. A lot of
• 42:03
  Speaker 1: things they say about what's happening are not that true,
• 42:05
  Speaker 1: and he's well sourced there. I think Dan Balls has
• 42:08
  Speaker 1: always been the thoughtful, big picture slowdown. I've seen a
• 42:10
  Speaker 1: lot of elections and he's at the Post. Ron Brownstein
• 42:14
  Speaker 1: at the National Journal is probably the best guy in demography,
• 42:17
  Speaker 1: which is always the motor of what's really going on.
• 42:20
  Speaker 1: If you want to kind of read the balance sheet
• 42:22
  Speaker 1: of the candidates with the reality of who really they're
• 42:24
  Speaker 1: probably gonna have in the end, if you know the
• 42:26
  Speaker 1: use of investing analogy Bronstein is very good at that.
• 42:30
  Speaker 1: And you know there are others. I mean, what about
• 42:32
  Speaker 1: the new media like um, Politico, Vox, BuzzFeed, Vice, any
• 42:37
  Speaker 1: of that stuff thrush at the Politico I think breaks
• 42:41
  Speaker 1: some stuff. I'm generally not a political fan because they're
• 42:43
  Speaker 1: in the often in the trivia and gossip business. They're
• 42:46
  Speaker 1: kind of the Hollywood reporter, the old Hollywood reporter of politics. Uh,
• 42:50
  Speaker 1: and so they'd really like to know who's fighting over
• 42:52
  Speaker 1: the Cafeterian menu in the campaign. And they're they're quick
• 42:55
  Speaker 1: to blast stuff out that's weekly sourced some sometimes, so
• 42:58
  Speaker 1: let's sometimes they get it right. So I don't want
• 43:00
  Speaker 1: to be too unfair to him, So let's talk about
• 43:03
  Speaker 1: the about the campaign nitty gritty, because you just you
• 43:07
  Speaker 1: just dropped something I want to follow up on that
• 43:09
  Speaker 1: there isn't a whole lot of campaign there. I keep
• 43:12
  Speaker 1: reading that Hillary has this massive machinery and they have
• 43:17
  Speaker 1: fifty offices in each of these of the fifty states,
• 43:20
  Speaker 1: and the get out the vote and all that sort
• 43:23
  Speaker 1: of stuff. They run like a finally tuned machine. And
• 43:27
  Speaker 1: he seems to be spending money in Virginia, which doesn't
• 43:30
  Speaker 1: make a whole lot of sense to me. But all
• 43:31
  Speaker 1: the conventional rules of this. Hillary has the big, complicated
• 43:35
  Speaker 1: campaign of the massive staff doing all the traditional things.
• 43:38
  Speaker 1: She's like the dog food company with the best satellite
• 43:41
  Speaker 1: aim trucks, jingles, you know, sung by Lassie. She's got everything.
• 43:45
  Speaker 1: The only problem is your crack open the dog food.
• 43:48
  Speaker 1: The dogs sniffet and they wine and run the other direction.
• 43:51
  Speaker 1: So but she has all the machinery and distribution, and
• 43:53
  Speaker 1: that is worth something. Trump has no campaign. He has
• 43:56
  Speaker 1: a couple of yes men who circle him yes women,
• 43:59
  Speaker 1: but it's all Trump. And the mechanics of the campaign
• 44:02
  Speaker 1: are an advanced operation because what Trump really wants is
• 44:05
  Speaker 1: somewhere to land the plane, somewhere to have a hall
• 44:08
  Speaker 1: full of an adoring throng to cheer, and he'll do
• 44:10
  Speaker 1: his routine. He kind of does his like stand up
• 44:13
  Speaker 1: Don Rickles meats whatever he is um Juan Perrone and
• 44:18
  Speaker 1: and you know that's the whole Trump campaign. So when
• 44:20
  Speaker 1: Trump has a big idea like hey, I'm gonna go
• 44:21
  Speaker 1: to an African American church and take on Hillary, great
• 44:25
  Speaker 1: media chump. You know, oh boy cat bites dog Republican
• 44:28
  Speaker 1: an African American community, Let's they're cover the hell out
• 44:31
  Speaker 1: of it. But you need a real campaign operation to
• 44:33
  Speaker 1: go find an African American church where pastors willing to
• 44:35
  Speaker 1: let you do a political speech, which by the way,
• 44:38
  Speaker 1: actually happens all the time in churches. But need depth
• 44:43
  Speaker 1: of field. And to figure that out. With Trump, the
• 44:45
  Speaker 1: advanced guys come in and say, all right, this will
• 44:47
  Speaker 1: be his whold room. Here's the special meat loaf, here's
• 44:50
  Speaker 1: the coffee, here's the signs. And they find out they
• 44:53
  Speaker 1: pick a pastor who shut him down because the thing
• 44:55
  Speaker 1: was not they couldn't execute it well. And so any
• 44:58
  Speaker 1: question of execution, be it policy, be it a digital
• 45:02
  Speaker 1: campaign that means anything for you know, the mobile devices
• 45:05
  Speaker 1: that are increasingly the front window on so much in communication,
• 45:08
  Speaker 1: including campaigns, all that stuff. They've got nothing. They they're
• 45:12
  Speaker 1: doing a few poles. They got people trying to talk
• 45:14
  Speaker 1: him in being just saying they got like one and
• 45:16
  Speaker 1: a half speech writers who can put him on a
• 45:17
  Speaker 1: prompter that he'll ignore half the time. But it's like
• 45:20
  Speaker 1: a bad congressional campaign level of technical competence. How important
• 45:24
  Speaker 1: is so he has this huge Twitter following, and I
• 45:27
  Speaker 1: will admit his tweets are amusing. Sometimes they're um I
• 45:32
  Speaker 1: want to figure out who writes them. Well, you could
• 45:34
  Speaker 1: tell there was it was. BuzzFeed said, when it's at
• 45:38
  Speaker 1: the bottom of each tweet, you could see was just
• 45:40
  Speaker 1: tweeted on an iPhone or an Android device. It turns
• 45:44
  Speaker 1: out that when it's on the Android device, it's his staff,
• 45:48
  Speaker 1: and when it's on the iPhone him and you could
• 45:50
  Speaker 1: see one one is very clearly angrier and and a
• 45:53
  Speaker 1: little more bullying, and the other one is a little
• 45:55
  Speaker 1: more circumspecting, a little more. I think he probably the
• 45:59
  Speaker 1: hoope picks who kind of his press valet, uh and
• 46:03
  Speaker 1: send out a Twitter, you know, and he barks out
• 46:05
  Speaker 1: something and maybe she tries to clean it up a little. So,
• 46:07
  Speaker 1: but how significant is Twitter to the national campaign? Is
• 46:12
  Speaker 1: this something that uh, the inside baseball people like and
• 46:15
  Speaker 1: are really impressed but the public doesn't care about. Or
• 46:19
  Speaker 1: is Twitter affecting the election? Twitter is a very fast
• 46:21
  Speaker 1: electronic bulletin board that all the reporters used to kind
• 46:24
  Speaker 1: of watch stuff. I'm at Murphy Mike and I do
• 46:27
  Speaker 1: it all the time. I've got over fifty thou followers
• 46:30
  Speaker 1: and I've never said my Twitter handle on television. It's
• 46:32
  Speaker 1: kind of weird. It just organically grows. Sure, but you
• 46:35
  Speaker 1: also get a lot of people who are just they
• 46:37
  Speaker 1: think they're digital warriors, and so they're barking at other
• 46:40
  Speaker 1: people and that sort of kind of graffiti on Twitter.
• 46:43
  Speaker 1: That's what the mute button is for, right, No, exactly.
• 46:45
  Speaker 1: My favorite thing on the Twitter feed. Um, I love
• 46:47
  Speaker 1: throwing people off the island. I figured they don't pay
• 46:49
  Speaker 1: to follow me. I get to fire people who are annoying,
• 46:52
  Speaker 1: get muted people who are intellectually dishonest. I block and
• 46:55
  Speaker 1: leave it at that. I kill people who do I
• 46:57
  Speaker 1: can't kill, block or mute them when they do bad puns.
• 47:01
  Speaker 1: I'm I'm tired of stupid and funny puns. That's a
• 47:04
  Speaker 1: real bush league move, you know. It's like really yeah,
• 47:06
  Speaker 1: yeah that, you know, work a little harder on the jokes.
• 47:09
  Speaker 1: So Twitter is a good way to get a message
• 47:12
  Speaker 1: out quickly. But in the mass voter world, the other
• 47:14
  Speaker 1: social media is much more powerful. Facebook, Facebook, and increasingly
• 47:18
  Speaker 1: Snapchat and some of the even pin est because what
• 47:22
  Speaker 1: Facebook does and all the social media does is they
• 47:25
  Speaker 1: take credible information and they move it sideways. In other words,
• 47:28
  Speaker 1: we have a thing now called the virtual precinct. And
• 47:30
  Speaker 1: the old days you have a precinct captain going door
• 47:32
  Speaker 1: to door, and you'd know the guy two doors over.
• 47:34
  Speaker 1: Oh yeah, he's a veterinarian, and come over, look, I
• 47:36
  Speaker 1: know your wife's big into animals. This candidate. Now, the
• 47:40
  Speaker 1: virtual precinct is your best friend from college, who's the
• 47:44
  Speaker 1: teacher in Columbus, Ohio. Is everybody as much in contact
• 47:49
  Speaker 1: with you as your friend two blocks over? So the
• 47:51
  Speaker 1: precinct on social media, those swing voters in Columbus may
• 47:55
  Speaker 1: not be getting their information from the Columbus regular Republican
• 47:58
  Speaker 1: or Democratic organization, but from their friend from high school
• 48:02
  Speaker 1: who actually lives in Riverside, California, who made take an
• 48:05
  Speaker 1: article that really persuaded her that Hillary is bad, click
• 48:09
  Speaker 1: a share, and then the person in Columbus will read
• 48:12
  Speaker 1: and trust their friend who sent him the clip, and
• 48:14
  Speaker 1: then information will go sideways and have a huge impact
• 48:17
  Speaker 1: in a precinct two thousand miles away from the person
• 48:20
  Speaker 1: have the social connection with, and it's really changed political organization.
• 48:24
  Speaker 1: So that raises an interesting question. In the O eight election,
• 48:28
  Speaker 1: it was clear that the Obama campaign had a much
• 48:32
  Speaker 1: more technologically sophisticated approach than either Hillary did Um or
• 48:40
  Speaker 1: McCain did. He seemed to really have that core group
• 48:45
  Speaker 1: of Google geeks that he brought along and became his
• 48:49
  Speaker 1: secret weapon. And what I've been hearing and especially in
• 48:54
  Speaker 1: the post Mornum after, was that, Hey, the GOP really
• 48:58
  Speaker 1: has to capture catch up to the Democrats on this
• 49:02
  Speaker 1: um and it doesn't seem to have happened this cycle.
• 49:07
  Speaker 1: How important is technology relative to what it used to be?
• 49:10
  Speaker 1: And is this lag between the Democrats and the GOP
• 49:15
  Speaker 1: as sizeable as it was? And when does the gap close?
• 49:18
  Speaker 1: It is sizeable, and it is a huge problem. But
• 49:21
  Speaker 1: one caveat. We always obsess on the gadgets, you know
• 49:24
  Speaker 1: in the campaign, Oh, the new mind reading pulling device
• 49:27
  Speaker 1: or this or that I ran a guy, a long
• 49:29
  Speaker 1: shot guy for president. We announced the campaign on compuser.
• 49:33
  Speaker 1: We hold the record for presidential campaign launched down the web.
• 49:38
  Speaker 1: But you can overdo the technology. The truth is in
• 49:40
  Speaker 1: ninety excuse me, in two thousand eight, when Obama had
• 49:45
  Speaker 1: much better analytics and digital than the mccaye campaign, which
• 49:48
  Speaker 1: was stone Age, you know, just the Keystone cops. The
• 49:53
  Speaker 1: Obama campaign would have won without the Internet because the
• 49:56
  Speaker 1: big narrative storytelling of the campaign and the demography the
• 49:59
  Speaker 1: most powerful forces were all lined up with Obama. What
• 50:02
  Speaker 1: about is the same true? I think the same. Let's
• 50:05
  Speaker 1: put this way, it is a huge. Campaigns are amplifiers,
• 50:10
  Speaker 1: and all media, be at radio, paid television, direct mail,
• 50:14
  Speaker 1: telephone calls, and of course everything digital, particularly mobile devices
• 50:18
  Speaker 1: which are eating everything, is a powerful amplifier. And the
• 50:21
  Speaker 1: analytics you can get by knowing what people are interested
• 50:25
  Speaker 1: in helps you learn so much more about the voters
• 50:27
  Speaker 1: and be so much better and even doing the television,
• 50:29
  Speaker 1: it's all true. In the Democrats are way ahead, but
• 50:32
  Speaker 1: some of that is not by choice. It is driven
• 50:34
  Speaker 1: by the audience. The Republican primary, our core tribe is old.
• 50:39
  Speaker 1: So guess what the dominant media is AM radio, which,
• 50:43
  Speaker 1: with all due respect to Bloomberg Radio, you know, I know,
• 50:46
  Speaker 1: you know, ten years from now you'll probably be streaming.
• 50:49
  Speaker 1: We're not sure AM radio will be carrying. This is
• 50:51
  Speaker 1: streaming already. So not only is this so here's the technology,
• 50:56
  Speaker 1: it's uh, definitely the Internet because they're younger. So so
• 51:00
  Speaker 1: this broadcast, this will go out on radio, it will
• 51:03
  Speaker 1: be streamed on Bloomberg dot com, it will be rebroadcast
• 51:06
  Speaker 1: on Sirius x M. It'll show up on iTunes, it'll
• 51:10
  Speaker 1: show up on SoundCloud, It'll be in a dozen places.
• 51:13
  Speaker 1: But you're saying the core GOP voter is a little
• 51:18
  Speaker 1: older there watching Fox News, they're listening to AM radio.
• 51:21
  Speaker 1: They're probably reading a physical paper, not not something online.
• 51:26
  Speaker 1: So those demographics, how big of an issue is that?
• 51:29
  Speaker 1: And when that because our center of gravity, our audiences,
• 51:33
  Speaker 1: our core audience that picks our nominee, they tend to
• 51:37
  Speaker 1: gravitate towards yesterday's media because of age. So we're really
• 51:42
  Speaker 1: good at AM radio, which is probably the least important
• 51:44
  Speaker 1: thing to be really good at if you plan the
• 51:46
  Speaker 1: next ten years of American politics. It's been listen, Rush Limbon,
• 51:49
  Speaker 1: there's a full crow. They've been really really affect right.
• 51:52
  Speaker 1: And they're on the web too. I mean they they're
• 51:54
  Speaker 1: branching out. But my point is it's kind of an
• 51:56
  Speaker 1: illustrative joke. Our activist grab it tate to AM radio,
• 52:00
  Speaker 1: their activate Their activists gravitate to the internet. So guess what,
• 52:05
  Speaker 1: they're much better at the internet organically. But we we
• 52:08
  Speaker 1: look we our problem is not technology. After that report
• 52:11
  Speaker 1: came out, which I agreed with, I would have loved
• 52:13
  Speaker 1: to have been a big iron salesman sound computers to
• 52:15
  Speaker 1: the R and C because everybody wants to buy the gadget.
• 52:18
  Speaker 1: Our problems are more fundamental than the gadget. Our problems
• 52:20
  Speaker 1: are modernizing conservatism to appeal to the demography of the
• 52:24
  Speaker 1: modern America so we can actually win a presidential election.
• 52:27
  Speaker 1: We have lost. You know, we're the market party. We
• 52:28
  Speaker 1: believe the market smart. We've lost the voter market in
• 52:32
  Speaker 1: five of the last six presidential elections. That's twenty years
• 52:35
  Speaker 1: of our product being rejected by the consumers of a
• 52:38
  Speaker 1: presidential election. The only group I know with a longer
• 52:41
  Speaker 1: than twenty year losing streak like that this is true
• 52:44
  Speaker 1: is the Washington generals who are paid to lose to
• 52:46
  Speaker 1: the problem globe drivers. They're losing streak is twenty four
• 52:49
  Speaker 1: years long. So when Trump blows it, we can turn
• 52:51
  Speaker 1: pro where be able to join the Washington generals. So
• 52:55
  Speaker 1: we've been speaking to Michael Murphy of the Rights Arise
• 52:58
  Speaker 1: pack and political consultant to Jeff Bush, John McCain, Arnold
• 53:01
  Speaker 1: Schwarzenegger and other and host of Radio Free g OP
• 53:06
  Speaker 1: which you can find that iTunes and everywhere else you
• 53:09
  Speaker 1: find podcasts have been have been found. If you enjoy
• 53:14
  Speaker 1: this conversation, be sure and stick around for a podcast
• 53:16
  Speaker 1: extras where we keep the tape rolling and continue chatting
• 53:20
  Speaker 1: all things political. You can read my daily column on
• 53:24
  Speaker 1: Bloomberg View dot com or follow me on Twitter at Riholts.
• 53:29
  Speaker 1: I'm Barry Rihults. You've been listening to Masters in Business
• 53:32
  Speaker 1: on Bloomberg Radio. Welcome to the podcast, Mike Murphy, Thank
• 53:36
  Speaker 1: you so much for doing this. I have to share
• 53:38
  Speaker 1: a hilarious story with you about how this interview came about.
• 53:43
  Speaker 1: So I have a booker, Taylor. She does a fabulous job.
• 53:47
  Speaker 1: Um and we're always you know, there's always three dozen
• 53:52
  Speaker 1: people in the process of either of them reaching out
• 53:55
  Speaker 1: to us or us reaching out to them. I'm not
• 53:57
  Speaker 1: going to be in New York until November whatever it is,
• 54:00
  Speaker 1: and it's a process. Your namesake, Michael Murphy was on
• 54:05
  Speaker 1: Bloomberg TV the same day you were on either UM
• 54:10
  Speaker 1: by Al due respect or one of the shows. So
• 54:14
  Speaker 1: I send an email to Taylor saying, oh, Mike Murphy
• 54:18
  Speaker 1: was really good. You should we should get him on.
• 54:19
  Speaker 1: She goes, Okay, not a problem. He's back in New
• 54:22
  Speaker 1: York and September fantastic. So I go about my day
• 54:26
  Speaker 1: and I don't think about it. We prep for these
• 54:29
  Speaker 1: about a week in advance. I start doing research and
• 54:32
  Speaker 1: I asked somebody, I don't know if it was you
• 54:35
  Speaker 1: or or the the press person, Hey, send me buy
• 54:38
  Speaker 1: a Well, we'll start our research. And back comes Mike Murphy,
• 54:43
  Speaker 1: right to rise, etcetera, etcetera. But you thought it was
• 54:45
  Speaker 1: a Silicon Valley guy right four months ago? I thought
• 54:49
  Speaker 1: it was the tech guy. So I tell Taylor this
• 54:52
  Speaker 1: and she goes, what do you want to do? I go,
• 54:54
  Speaker 1: this is fantastic. The elections a month and a half away.
• 54:57
  Speaker 1: I have a million questions for Mike Murphy. Yes, why
• 55:00
  Speaker 1: all means? So this was a for tour right now,
• 55:02
  Speaker 1: the tech guys, I meet the press, right. I wonder
• 55:05
  Speaker 1: how often that happens? So thank you so much for
• 55:08
  Speaker 1: doing this. I'm very excited. Um, And most of my
• 55:11
  Speaker 1: work is working for business by the way, you know, yeah,
• 55:13
  Speaker 1: I don't really do campaigns anymore. I do corporate problem
• 55:16
  Speaker 1: solving and so is it crisis consulting or specific crisis
• 55:21
  Speaker 1: And also you know, messaging with politics teaches you how
• 55:24
  Speaker 1: to bunch a message through and a product on a
• 55:27
  Speaker 1: specific both services I do work for HP Enterprise. I've
• 55:32
  Speaker 1: done work in the past with Facebook and you know,
• 55:34
  Speaker 1: a whole bunch of HP um So Carli Fiorina, what
• 55:38
  Speaker 1: what was that about? Well, she's you know, great presentation, ambitious,
• 55:43
  Speaker 1: and she's now looking at running for chair of the
• 55:44
  Speaker 1: Republican National Committee. Really think she has a shot. I
• 55:48
  Speaker 1: think she'll lose. Of Ryan's previous runs for re election,
• 55:50
  Speaker 1: He's got a pretty good grip on it. But maybe. Yeah,
• 55:53
  Speaker 1: she's got a lot of fans in the party. What
• 55:55
  Speaker 1: what happened to her campaign? Well, I think she never
• 55:58
  Speaker 1: really had the base to run for presis it's hard
• 56:00
  Speaker 1: to run for president when you're bad stories you you've
• 56:03
  Speaker 1: got Claubert in you know, really a very hard state
• 56:05
  Speaker 1: to win. She ran courageously in California, like Meg Women
• 56:08
  Speaker 1: did and not Meg Whitman has a great reputation from
• 56:12
  Speaker 1: from eBay and uh, I forgot the products company she
• 56:16
  Speaker 1: was at before, was at Colgate palum Olive or something like.
• 56:19
  Speaker 1: I think she was at PG and P and But
• 56:22
  Speaker 1: so she's got Meg Woman has wonderful corporate resume. The
• 56:26
  Speaker 1: compact HP merger people aren't as excited about, and I
• 56:29
  Speaker 1: think Carly has less of a of the business cred.
• 56:35
  Speaker 1: California business community did not really fall behind Carly the
• 56:38
  Speaker 1: way they did behind Meg when they both ran. But
• 56:42
  Speaker 1: I give them both credit for running in an incredibly
• 56:43
  Speaker 1: hard state to win as a Republican. And now if
• 56:47
  Speaker 1: you're not Arnold, double yeah. But Arnold was like a hybrid.
• 56:50
  Speaker 1: He could you know, he had that big identity so
• 56:52
  Speaker 1: you can kind of bring everybody together. And it was
• 56:54
  Speaker 1: a recall ellection, no Republican primery, so unlike both that
• 56:59
  Speaker 1: Megan Meggie had an anti immigration guy running in the primary,
• 57:02
  Speaker 1: which really hurt her in the general election. That's a
• 57:05
  Speaker 1: that's an issue in California much more so than New York.
• 57:08
  Speaker 1: I'm surprised homelessness isn't as big an issue in California
• 57:13
  Speaker 1: as a New Yorker going to California. You go to
• 57:16
  Speaker 1: l A, San Francisco, or straight up the coast, Portland, Seattle.
• 57:21
  Speaker 1: As a New Yorker, I'm shocked at the amount of
• 57:23
  Speaker 1: homelessness San Diego. It's shocking. It's it's an issue that
• 57:28
  Speaker 1: comes up on polling, but California politicians don't talk about it.
• 57:31
  Speaker 1: Is that well. I think we're one party state and
• 57:33
  Speaker 1: nobody wants to kind of get into the identity politics
• 57:36
  Speaker 1: arguments with the interest groups that say more money to
• 57:39
  Speaker 1: the homeless versus kind of the groups that are more
• 57:41
  Speaker 1: of a tough love approach and so they don't see
• 57:44
  Speaker 1: a political win and jumping in the middle of that.
• 57:46
  Speaker 1: Utah did an analysis and they said we could take
• 57:49
  Speaker 1: these people, put them in public housing so they get
• 57:51
  Speaker 1: their meds, so they It's interesting. I was in Utah
• 57:53
  Speaker 1: two days ago and a couple of mayors straightened me
• 57:55
  Speaker 1: out about that because I asked him about it. So
• 57:57
  Speaker 1: and the media got it wrong. We did a thing
• 58:01
  Speaker 1: for veterans. We could take care of the veterans that way,
• 58:04
  Speaker 1: but the whole community now homeless are coming to Utah
• 58:08
  Speaker 1: from around the country believing that there's a part. Yeah,
• 58:11
  Speaker 1: so this was for homeless vets, not for the general.
• 58:14
  Speaker 1: That was the initiative and I had and it's been
• 58:16
  Speaker 1: very successful. The city councilman from Salt Lake kind of
• 58:19
  Speaker 1: explained to me and said, my theory is were we
• 58:21
  Speaker 1: have a growing homeless problem because we became famous as
• 58:24
  Speaker 1: the place where it come to you, there's an apartment
• 58:25
  Speaker 1: for you, and that's not quite accurate. Well, sure, the
• 58:27
  Speaker 1: homeless get online. They read this on the internet. Are
• 58:30
  Speaker 1: people really traveling across country to go to Utah? I'm
• 58:33
  Speaker 1: not the fact checker on it, but I had a
• 58:36
  Speaker 1: credible Utah's municipal official tell me he thought that that
• 58:39
  Speaker 1: story had attracted more homeless but but the fact that
• 58:42
  Speaker 1: it was homeless vets that that's what that was the program. Yeah, okay,
• 58:45
  Speaker 1: thought that was a distinction that should be made. That
• 58:48
  Speaker 1: makes a lot of sense. So so let's let's talk
• 58:51
  Speaker 1: a little bit about about the general election and things
• 58:54
  Speaker 1: people don't understand. If if you were to share with
• 58:57
  Speaker 1: the public, here's something you but you don't understand about
• 59:01
  Speaker 1: the entire campaign process, what would that be? I would say, One,
• 59:07
  Speaker 1: it is a human endeavor, So all the eccentricities and
• 59:12
  Speaker 1: wonderful things that make humans unpredictable are proud of the campaign.
• 59:16
  Speaker 1: It's less of a machine than people think, and eccentrics
• 59:20
  Speaker 1: have a role in it. Second, people way overestimate the
• 59:24
  Speaker 1: importance of daily polling data. I often joked that if
• 59:28
  Speaker 1: I woke up one day and they said, hey, welcome
• 59:30
  Speaker 1: to China. You have a new job. You're head of
• 59:32
  Speaker 1: the Chinese spy agency, I would say Okay, I guess
• 59:35
  Speaker 1: I gotta do this. Give me the budget, and I'd
• 59:37
  Speaker 1: immediately take about twenty million dollars and I would start
• 59:40
  Speaker 1: buying off polsters in the US because the pundits you
• 59:45
  Speaker 1: see on television, the experts quote unquote, who notice have
• 59:48
  Speaker 1: to be an expert about everything, so often they're an
• 59:50
  Speaker 1: expert about nothing. They look at the average of all
• 59:53
  Speaker 1: the polls every morning, and then the engineer opinions to
• 59:56
  Speaker 1: fit that, and so we're in this kind of silly
• 59:58
  Speaker 1: feedback loop. The truth is it's a lot more like
• 1:00:00
  Speaker 1: value investing. You want to identify the balance sheet of
• 1:00:04
  Speaker 1: each campaign, the real assets that are there, get through
• 1:00:06
  Speaker 1: the accounting blur, and not worry about the daily visitudes
• 1:00:10
  Speaker 1: of polling, which you have a lot to do with
• 1:00:11
  Speaker 1: what was on the news two days ago, and see
• 1:00:14
  Speaker 1: who's getting what assets from the electorate, who's doing well
• 1:00:18
  Speaker 1: with women and women are gonna like and land with
• 1:00:20
  Speaker 1: who are college educated versus high school educated men going
• 1:00:23
  Speaker 1: for where are minorities going? And then you can pretty
• 1:00:26
  Speaker 1: well know the reversion the mean that will happen on
• 1:00:29
  Speaker 1: election day. That's so funny, say that literally my column
• 1:00:32
  Speaker 1: that that September six, is about we over emphasize the
• 1:00:37
  Speaker 1: most recent data and ignore the long term trends. These
• 1:00:41
  Speaker 1: daily things are so noisy, they're so subject to revision.
• 1:00:45
  Speaker 1: You were mentioning you could have a hundred polls at
• 1:00:50
  Speaker 1: forty one, but the one poll that comes out and
• 1:00:52
  Speaker 1: says forty six, and when it's against the overwhelming way
• 1:00:56
  Speaker 1: of the evidence, the assumption is, Hey, that's the poll
• 1:00:59
  Speaker 1: that has something wrong with it. That's the one everybody
• 1:01:02
  Speaker 1: runs with. It's the one that makes the news. I
• 1:01:04
  Speaker 1: have a friend who was an old retired journalist who says,
• 1:01:06
  Speaker 1: if a Martian landed and watched only television, they would
• 1:01:10
  Speaker 1: think that Gerbils can water ski because the only time
• 1:01:13
  Speaker 1: you've seen a Gerbil on TV, it's on water ski.
• 1:01:15
  Speaker 1: So therefore Gerbils must the outlier gets the attention. Yes,
• 1:01:19
  Speaker 1: and that and that creates the very much um. I'll
• 1:01:23
  Speaker 1: defend a little bit. They are right when they overreacted.
• 1:01:26
  Speaker 1: These polls at the racist tightened a little bit. But
• 1:01:28
  Speaker 1: they assume that it's kind of like the psychology of
• 1:01:31
  Speaker 1: the stock market. People assume the current direction will always continue,
• 1:01:34
  Speaker 1: It'll keep going up or it'll keep going down. So
• 1:01:37
  Speaker 1: trees don't grow to the sky. You can't exactly. And
• 1:01:41
  Speaker 1: so when I look at the election, they've seen the
• 1:01:43
  Speaker 1: new Zarcher pole. Here's everything I know. Polls are hard
• 1:01:46
  Speaker 1: to take because people don't answer their phone anymore. For
• 1:01:49
  Speaker 1: sure that the methodology is harder, which means to do
• 1:01:51
  Speaker 1: it right is more expensive and takes more time in
• 1:01:53
  Speaker 1: the field. The average media publisher doesn't always say, when
• 1:01:57
  Speaker 1: I'm buying a pole, can I get the most expensive,
• 1:01:59
  Speaker 1: really good one that takes a week to do. They're like,
• 1:02:01
  Speaker 1: I need an instant pulled them out to have candy,
• 1:02:04
  Speaker 1: have something to talk about on the morning news flash.
• 1:02:06
  Speaker 1: So you know, the pressure to provide cheap, junkie polling,
• 1:02:10
  Speaker 1: to consume, to feed the trivial discussion every day with
• 1:02:13
  Speaker 1: the sirens going off, we have a new action poll
• 1:02:15
  Speaker 1: and now it's a closer horse race because you were
• 1:02:17
  Speaker 1: using medioc pulse. Well, not always me to. I don't
• 1:02:20
  Speaker 1: want to have too broad of a brush, but let
• 1:02:22
  Speaker 1: me put it this way. The election is more complicated
• 1:02:25
  Speaker 1: than daily polls, and the big trends that you want
• 1:02:27
  Speaker 1: to figure out don't always reveal themselves in the poll.
• 1:02:30
  Speaker 1: And finally, everybody covers the horse race of the two numbers.
• 1:02:34
  Speaker 1: One guy's at forty five, ones at forty four. It's
• 1:02:37
  Speaker 1: at one point race. I'm saying, well, who's not yet
• 1:02:40
  Speaker 1: at forty nine? And what does the next five points
• 1:02:42
  Speaker 1: look like to get there? Because the people are undecided
• 1:02:45
  Speaker 1: are not going to leave the planet. Almost all of
• 1:02:47
  Speaker 1: them will vote if the poll is correctly done and
• 1:02:49
  Speaker 1: registered voters, and they're gonna land on somebody. So even
• 1:02:52
  Speaker 1: though it might be a two point race now at four,
• 1:02:56
  Speaker 1: there's another, you know, easy ten percent of the vote
• 1:02:59
  Speaker 1: that's going to show up and be for somebody. And
• 1:03:01
  Speaker 1: that's a much better understanding those voters and where they're
• 1:03:04
  Speaker 1: gonna land or likely to land tells you a lot
• 1:03:06
  Speaker 1: more than three. Are there really undecided voters at this
• 1:03:11
  Speaker 1: point in this election? So let me push back on this.
• 1:03:16
  Speaker 1: This show and it has been a reality show. This
• 1:03:20
  Speaker 1: has been going on for well over a year. The
• 1:03:23
  Speaker 1: Brits have an election, it's six weeks and they're done.
• 1:03:26
  Speaker 1: And I think the Canadians of thirty days, this is
• 1:03:29
  Speaker 1: a year of this. Is there anyone out there who
• 1:03:32
  Speaker 1: really doesn't have a firm opinion on I like Hillary,
• 1:03:35
  Speaker 1: I don't like Hillary. I like Donald Trump, I don't
• 1:03:38
  Speaker 1: like Donald Trump. I mean, at this point, what is
• 1:03:41
  Speaker 1: the big reveal that's gonna affect them or are they
• 1:03:44
  Speaker 1: just being a little coy there being a low COI um,
• 1:03:49
  Speaker 1: because we in the old days, you know, like the
• 1:03:51
  Speaker 1: gallop pole Harris, when the polling phone call came, you'd
• 1:03:55
  Speaker 1: stand up. It was like the president calling. It's you know,
• 1:03:58
  Speaker 1: it's a big deal. Now we have a pull every
• 1:04:01
  Speaker 1: two seconds. So there's some political science thinking that says
• 1:04:04
  Speaker 1: people use polls to kind of slap the system around
• 1:04:07
  Speaker 1: a little bit, because everybody knows they get to change
• 1:04:09
  Speaker 1: their minds. So when if you were to like the electorate,
• 1:04:13
  Speaker 1: people who say there for Hillary might for a week
• 1:04:16
  Speaker 1: say I'm thinking about Trump. I'm back to Hillary. It's
• 1:04:19
  Speaker 1: kind of like we asked somebody what kind of car
• 1:04:21
  Speaker 1: they're gonna buy. Well, I'm thinking this is the year
• 1:04:23
  Speaker 1: for the Mercedes. You know, if you ask them six
• 1:04:25
  Speaker 1: months before their leases up, and they're gonna float around
• 1:04:28
  Speaker 1: a couple of car brands. Half of them will stay
• 1:04:31
  Speaker 1: like base voters, They're not going anywhere. I'm a Chevy guy,
• 1:04:33
  Speaker 1: always better. But others will float based on what they're
• 1:04:36
  Speaker 1: seeing out there. But if you pull the same people
• 1:04:38
  Speaker 1: three days before they buying the car. They're down to
• 1:04:40
  Speaker 1: a price offer and the Mercedes is now off the
• 1:04:43
  Speaker 1: list because they found out that always gonna be three
• 1:04:46
  Speaker 1: more month than I thought. And they're heading for that
• 1:04:49
  Speaker 1: Ford fusion or whatever. So you know, just because they
• 1:04:52
  Speaker 1: say it on September seventeen doesn't mean it's what's going
• 1:04:55
  Speaker 1: to happen in the election. It tells you what would
• 1:04:57
  Speaker 1: happen at the election were held yesterday. So so we've
• 1:05:01
  Speaker 1: seen poles in the past that um famously Carter was ahead,
• 1:05:07
  Speaker 1: was it nine months? Eight months before the election, and
• 1:05:11
  Speaker 1: going into the primaries early on it looked like Obama
• 1:05:15
  Speaker 1: had no chance. In two thousand and eight, when do
• 1:05:18
  Speaker 1: the poles really begin to firm up. It's mid September.
• 1:05:22
  Speaker 1: We have what seven weeks left. I don't know any
• 1:05:25
  Speaker 1: serious practitioner, which means people who spent twenty or thirty
• 1:05:29
  Speaker 1: years running races, living in crap hotels and campaign headquarters
• 1:05:34
  Speaker 1: for senators, governors, congressman and occasionally presidents who pays too
• 1:05:38
  Speaker 1: much attention to the horse race ballot until after the
• 1:05:41
  Speaker 1: first debate. And that means which is the end of
• 1:05:44
  Speaker 1: this month, yea, so early October and until then, it's
• 1:05:48
  Speaker 1: like me handing you an apple, some sugar and some butter,
• 1:05:51
  Speaker 1: some flour, and say, what do you think of my
• 1:05:53
  Speaker 1: apple pie? You know, not ready yet. You have to
• 1:05:56
  Speaker 1: cook the thing. And so do we follow polling? Now?
• 1:05:59
  Speaker 1: Of course we do, but you don't really look at
• 1:06:00
  Speaker 1: the horse race. You look at the internal numbers. What
• 1:06:02
  Speaker 1: do they think of Trump? What do they think of Hillary?
• 1:06:04
  Speaker 1: What do they not know about Trumpery Hillary? That you
• 1:06:07
  Speaker 1: know as a consultant is true because the main thing
• 1:06:10
  Speaker 1: we do in a campaign has introduced new information and
• 1:06:13
  Speaker 1: that is a powerful thing. So that's a really interesting
• 1:06:17
  Speaker 1: set of questions. And let's let's unpack that a little bit. First,
• 1:06:21
  Speaker 1: in a stage with twelve people. Trump was a tremendous debate.
• 1:06:26
  Speaker 1: Presents that worked out really well. Pre word title, and
• 1:06:29
  Speaker 1: remember the electorate and relican primary is only maybe twenty
• 1:06:32
  Speaker 1: nine million people, which is one hundred million fewer than
• 1:06:36
  Speaker 1: the general election electorates. So one of the things is
• 1:06:39
  Speaker 1: happening now is people are saying, well, nobody thought Trump
• 1:06:41
  Speaker 1: could win the primary, and he won the primary. So
• 1:06:43
  Speaker 1: what streets caused rain? Which means Trump can win the general?
• 1:06:46
  Speaker 1: They're two totally different electorates. You know, it's so heading
• 1:06:50
  Speaker 1: into the general debates for the general election. Um, what
• 1:06:56
  Speaker 1: what you read on how he's gonna behave and how
• 1:07:00
  Speaker 1: he's gonna do in a one on one debate versus
• 1:07:03
  Speaker 1: what he did in the in the debate. You know,
• 1:07:07
  Speaker 1: it is impossible to protict Trump. It's just you know,
• 1:07:13
  Speaker 1: the only thing I'll say is, you know Trump will
• 1:07:15
  Speaker 1: be Trump, which means he'll crean around, he'll vamp everything.
• 1:07:20
  Speaker 1: He'll one minute he'll try to be thoughtful and quiet,
• 1:07:22
  Speaker 1: the next minute he'll be talking about Vince Foster. What
• 1:07:25
  Speaker 1: the mixes of that? You don't know? I mean, the
• 1:07:27
  Speaker 1: joke I tell about Trump is the Trump advisors are
• 1:07:30
  Speaker 1: kind of like Charlie Manson's Fox Trot instructors Charlie Today's
• 1:07:34
  Speaker 1: foxtrot lesson great step step tap step steps. He does
• 1:07:39
  Speaker 1: it and he doesn't have any thinking, Wow, he's making
• 1:07:41
  Speaker 1: real progress. Then he stabs you in the ip A pencil.
• 1:07:43
  Speaker 1: So you can't predict Trump other than he will be unpredictable.
• 1:07:47
  Speaker 1: That's the prediction. And we will see versions of what
• 1:07:50
  Speaker 1: we've seen before because people don't change. So whether it's
• 1:07:54
  Speaker 1: a mix of the more subdued Trump they occasionally get
• 1:07:56
  Speaker 1: because they've got the thorizin out or whatever they do,
• 1:07:59
  Speaker 1: or it's Trump totally unhinged or both during a debate,
• 1:08:02
  Speaker 1: when when kind of crazy Trump breaks out of the
• 1:08:06
  Speaker 1: thorazine Trump after thirty minutes, when you know you can't
• 1:08:08
  Speaker 1: put another pill in? Who knows? Now, Hillary? We do
• 1:08:12
  Speaker 1: know because her personality is so transparent, she'll try to
• 1:08:15
  Speaker 1: win the spelling be calling me, call on me. I
• 1:08:17
  Speaker 1: wrote a paper on that. She's a policy wonk, and
• 1:08:19
  Speaker 1: and she'll be wonky in the debates. So the real
• 1:08:22
  Speaker 1: question will be when Trump kind of tries to bully
• 1:08:25
  Speaker 1: and muscle in on her, how she handles that without
• 1:08:27
  Speaker 1: doing a bad Trump imitation, which would not help her.
• 1:08:30
  Speaker 1: But she can't be too passive either. So it's a
• 1:08:33
  Speaker 1: tougher debate for her because she got she's got to
• 1:08:37
  Speaker 1: navigate the crazy will still showing strength because he has
• 1:08:41
  Speaker 1: got to be strong and likable and experienced. And I
• 1:08:45
  Speaker 1: don't love her, but I could live with her. That
• 1:08:47
  Speaker 1: is that what she's going for. I would say from
• 1:08:49
  Speaker 1: her point of view, I would be thinking about how
• 1:08:52
  Speaker 1: do I move the needle on the number one? The
• 1:08:54
  Speaker 1: kind of thorn in the voters toe about me Hillary,
• 1:08:58
  Speaker 1: which is nobody trust me because they think I'm an
• 1:09:00
  Speaker 1: ultimate political calculating machine. So how can I break through
• 1:09:04
  Speaker 1: all the political crack and get people who think I'm
• 1:09:05
  Speaker 1: a real person. I have stuff I believe in, which
• 1:09:08
  Speaker 1: is why I'm in this, and here's what I'll do
• 1:09:10
  Speaker 1: for you. How does she get that connection done? And
• 1:09:13
  Speaker 1: how does she appear strong enough that Trump sitting his
• 1:09:16
  Speaker 1: hair on fire, you know, six ft away um does
• 1:09:20
  Speaker 1: not affect her in a way where people say, you
• 1:09:22
  Speaker 1: know what, She's just not strong enough. Trump, meanwhile, if
• 1:09:26
  Speaker 1: he's smart, has to note to win the election. He's
• 1:09:29
  Speaker 1: got to take one of two groups and dramatically change
• 1:09:32
  Speaker 1: what they think about him, which is the hardest thing
• 1:09:34
  Speaker 1: to do in politics. Get people to totally change what
• 1:09:36
  Speaker 1: they think. Is there to gonna get minority voters to
• 1:09:38
  Speaker 1: change what they think? Or he's got to get college
• 1:09:41
  Speaker 1: educated white women to go from not liking him to
• 1:09:43
  Speaker 1: loving him. And it is a lift I've never seen
• 1:09:48
  Speaker 1: anybody else do. And Trump is not the kind of
• 1:09:51
  Speaker 1: guy who does discipline lifts. He just shows up and
• 1:09:54
  Speaker 1: he still thinks it's the Republican primary. And so I
• 1:09:57
  Speaker 1: think he'll do his act and he'll hurt her a little.
• 1:10:01
  Speaker 1: And because I don't know how good she'll be, I'm
• 1:10:03
  Speaker 1: very worried she'll be overprepared and all that from again,
• 1:10:06
  Speaker 1: very worried. I'm not voting for I'm not a Hillary
• 1:10:09
  Speaker 1: Clinton fan, but are you kind of in the never
• 1:10:11
  Speaker 1: Trump came, I never vote for Trump. If it came
• 1:10:14
  Speaker 1: down to just my vote, I would probably jump in
• 1:10:19
  Speaker 1: the lake. But I'd leave with my suicide note, a
• 1:10:22
  Speaker 1: absentee ballot for Hillary Clinton, because if I had to
• 1:10:24
  Speaker 1: pick her, mediocrity is so much better than Trump's anality.
• 1:10:28
  Speaker 1: I mean, within the range of acceptable politicians. She may
• 1:10:34
  Speaker 1: not be your cup of tea, but you know that
• 1:10:36
  Speaker 1: she's a serious candidate. She won't try to get out
• 1:10:39
  Speaker 1: of NATO. She'll she be ten better than Obama on
• 1:10:42
  Speaker 1: foreign policy. Now, and that's on the economy. What's your
• 1:10:46
  Speaker 1: view of her on the economy? How far has Bernie
• 1:10:49
  Speaker 1: dragged her to the left dangerously far? The the the
• 1:10:53
  Speaker 1: hijack team of Bernie Sanders and Elizabeth Warren are a threat,
• 1:10:57
  Speaker 1: and they're a tragic one because the policies they're wishing
• 1:11:00
  Speaker 1: her into, and she has plenty of her own bad
• 1:11:02
  Speaker 1: instincts here are going to hurt the people they want
• 1:11:04
  Speaker 1: to help the most. It's gonna be murder on the
• 1:11:06
  Speaker 1: working poor because what's gonna happen. Growth's gonna drop, and
• 1:11:10
  Speaker 1: with that there will be no upward pressure on wages,
• 1:11:13
  Speaker 1: and the people who are barely getting by right now,
• 1:11:15
  Speaker 1: they're gonna get a worse deal. Now we've had let
• 1:11:18
  Speaker 1: me push back on you a little bit. The most
• 1:11:20
  Speaker 1: recent data on wages came out. It was the best
• 1:11:23
  Speaker 1: numbers we've seen in a while. We're still below the highs,
• 1:11:28
  Speaker 1: but the gains over the past twelve months have fallen
• 1:11:32
  Speaker 1: mostly to the middle class and the poor. That's very
• 1:11:35
  Speaker 1: different than the past ten twenty years. Some of it
• 1:11:39
  Speaker 1: is the reduction and poverty, some of it is um
• 1:11:42
  Speaker 1: the lowered number of people with without health care or
• 1:11:46
  Speaker 1: healthcare insurance, and some of it is just, hey, we're
• 1:11:49
  Speaker 1: the cycle has now gone far enough that McDonald's, when
• 1:11:53
  Speaker 1: with Donald's and Walmart, have to raise their bottom wages
• 1:11:57
  Speaker 1: to attract employees. Hey, we're sty close to full employment
• 1:12:01
  Speaker 1: at this point. So the pushback is this is working,
• 1:12:05
  Speaker 1: and we want to continue letting it to work. So
• 1:12:07
  Speaker 1: go with me. Hillary who will continue these policies as
• 1:12:11
  Speaker 1: opposed to Donalds, who's going to do who knows what?
• 1:12:14
  Speaker 1: How do you respond to something like what We are
• 1:12:17
  Speaker 1: starting to see some wage growth and we're you know,
• 1:12:20
  Speaker 1: the economy is showing some strength. I agree with that,
• 1:12:23
  Speaker 1: But her plan appears to be more re redistribution, you know,
• 1:12:28
  Speaker 1: because she doesn't want to face the hard question the
• 1:12:30
  Speaker 1: next president has to face, which is, we can't we
• 1:12:32
  Speaker 1: can't afford the entitlement state we have. So her plan
• 1:12:35
  Speaker 1: as well, We're gonna make the rich pay more their
• 1:12:38
  Speaker 1: fair share so I can have my cake and eat
• 1:12:40
  Speaker 1: it too. I don't have to touch entitlements, which are
• 1:12:42
  Speaker 1: ticking fiscal time bomb. I can tax more money, which
• 1:12:46
  Speaker 1: will have a chilling effect on the economy, and I'll
• 1:12:49
  Speaker 1: keep having growth that way. I think the only real
• 1:12:52
  Speaker 1: kind of knsie and growth plan she's got that's different
• 1:12:54
  Speaker 1: than Obama. She's talking about infrastructure spending. I'm actually for
• 1:12:58
  Speaker 1: infrastructure spending because I don't hate the idea of borrowing
• 1:13:00
  Speaker 1: money from the Chinese at you know, zero zero into
• 1:13:03
  Speaker 1: maybe negative industrated. We really skunk them and build things
• 1:13:07
  Speaker 1: that enhance American productivity. But if we don't give you,
• 1:13:10
  Speaker 1: for instance, on infrastructure, where would you spend I totally
• 1:13:14
  Speaker 1: agree with you, but preach to the choir, where should
• 1:13:17
  Speaker 1: we be spending more money on infrastruct um. There're two baskets.
• 1:13:22
  Speaker 1: One is the basket of stuff we have to do.
• 1:13:25
  Speaker 1: But the water supply system is terrible, vulnerable, insecure and
• 1:13:30
  Speaker 1: falling apart. And if we we have water means throughout
• 1:13:33
  Speaker 1: the country that are literally a hundred and fifty years
• 1:13:36
  Speaker 1: old and have never built for fifty years, never been replaced,
• 1:13:39
  Speaker 1: and unless we don't like the idea of drinking fresh water,
• 1:13:41
  Speaker 1: there's massive things to be done there. On the other
• 1:13:45
  Speaker 1: safety one is bridges. A civil engineers society thinks why
• 1:13:47
  Speaker 1: not to four bridges that are unsafe? Bridges and tunnels
• 1:13:51
  Speaker 1: terrible totally. And then on the productivity increasing sign our
• 1:13:54
  Speaker 1: ports um on the West coast where I'm from, and
• 1:13:58
  Speaker 1: you preach into the right are our ports are going
• 1:14:00
  Speaker 1: to be under real competitive attack from Chinese finance. Mexican
• 1:14:03
  Speaker 1: ports tied into the high speed rail system in Texas,
• 1:14:07
  Speaker 1: and it is incredibly hard to get a can from
• 1:14:09
  Speaker 1: the Port of Los Angeles into the intermodal system now
• 1:14:12
  Speaker 1: because we haven't really invested any money the other thing
• 1:14:14
  Speaker 1: we have to do. I'm a right wing nut, but
• 1:14:16
  Speaker 1: I also know the facts, and I live in Los Angeles.
• 1:14:19
  Speaker 1: We lead the country in childhood asthma in the bowl
• 1:14:22
  Speaker 1: around l A and the heavy sulfur we burn in
• 1:14:25
  Speaker 1: the port is a big problem there. So my left
• 1:14:27
  Speaker 1: wing Bernie friends would say shut down the port. I
• 1:14:29
  Speaker 1: would say, give free electric hook uffs, you know, so
• 1:14:32
  Speaker 1: they can turn off the heavy diesel there and switch
• 1:14:34
  Speaker 1: to natural gas shuttle trucks. But that's dollars. But all
• 1:14:38
  Speaker 1: in all, the healthcare off that cost of having kids
• 1:14:40
  Speaker 1: with asthma, not the humanitarian side is even more persuasive.
• 1:14:45
  Speaker 1: I would love to see a port revamp, and we
• 1:14:47
  Speaker 1: could really use a natural gas ternament on the West coast.
• 1:14:51
  Speaker 1: Let me see more American made nuclear power plan. Let
• 1:14:53
  Speaker 1: me let me add that I want to see more
• 1:14:56
  Speaker 1: exploration of the thorium um plans, which is supposed to
• 1:15:00
  Speaker 1: be uh, the new technology not much cleaner. But let
• 1:15:04
  Speaker 1: me give two little caveats to what you said. You know,
• 1:15:07
  Speaker 1: we really haven't shored up our plants are our ports
• 1:15:11
  Speaker 1: as much From a security stand I mean, we inspect
• 1:15:16
  Speaker 1: with Geiger counters and other um checks for nuclear devices
• 1:15:22
  Speaker 1: something like one in twenty is one thing, and then
• 1:15:26
  Speaker 1: the other thing is you didn't mention our electrical grid
• 1:15:29
  Speaker 1: is very much antiquated. It's a patchwork, it's it's vulnerable.
• 1:15:34
  Speaker 1: That's something else that from both a infrastructure perspective and
• 1:15:40
  Speaker 1: from a security perspective, we're not doing it. I couldn't.
• 1:15:43
  Speaker 1: I couldn't agree more. The problem is, though, we need
• 1:15:46
  Speaker 1: Davis Bacon reform because right now to build public works
• 1:15:49
  Speaker 1: is about a billion dollars a foot. And uh, that's
• 1:15:52
  Speaker 1: how we've rebuilt. California. Governor Pete Wilson after the earthquake
• 1:15:55
  Speaker 1: had freeway overpasses that have fallen down, and I got
• 1:15:59
  Speaker 1: to suspend some as bacon stuff. So everything, it's the
• 1:16:02
  Speaker 1: labor rule. I had a mayor in a in a
• 1:16:05
  Speaker 1: western state of a growing community, tell me I can
• 1:16:08
  Speaker 1: build a highway for half of what the FEDS will
• 1:16:11
  Speaker 1: spend because of some of the labor rules they have.
• 1:16:14
  Speaker 1: So we meet it halfway. I think the Republican votes
• 1:16:17
  Speaker 1: for infrastructure where the time now, low interest rates. I'm
• 1:16:19
  Speaker 1: for borrowing money to make our physical plant. The best
• 1:16:22
  Speaker 1: fifty year bonded you could. You could refinance a national
• 1:16:26
  Speaker 1: day everything, totally agree. The other thing, though, is that
• 1:16:29
  Speaker 1: we don't get entitled in spending under control the other
• 1:16:32
  Speaker 1: half of the equation. It's going to eat the entire budget,
• 1:16:35
  Speaker 1: so it's Medicare, Medicaid, social security, particularly Medicare Medicaid. I
• 1:16:38
  Speaker 1: know I only have you for a few more minutes.
• 1:16:40
  Speaker 1: Let me jump to some of my favorite questions I
• 1:16:42
  Speaker 1: asked everybody, um, and I'll keep it really short because
• 1:16:46
  Speaker 1: I know times of wasting. First thing, favorite books? What
• 1:16:50
  Speaker 1: what sort of books do you like? Uh? I read
• 1:16:52
  Speaker 1: a lot of history. I'm kind of a history nerd.
• 1:16:54
  Speaker 1: I read a lot of everything. I'm a bibliophile. Give me,
• 1:16:56
  Speaker 1: give me a few names. I like the Earnest May stuff. Um.
• 1:17:00
  Speaker 1: Ernest Ernest May is a professor at Harvard adviser to
• 1:17:03
  Speaker 1: the Pentagon. Give me a name of one book, well,
• 1:17:05
  Speaker 1: Strange Victory, where he does all the war games of
• 1:17:07
  Speaker 1: how the Germans beat the French from the French had
• 1:17:09
  Speaker 1: the bigger army and nobody thought even when they runned
• 1:17:12
  Speaker 1: at West Point the French World War Two, the French win. Uh.
• 1:17:16
  Speaker 1: He also wrote a great book, I don't know the
• 1:17:17
  Speaker 1: exact title, about how people argue with historical anecdote evidence
• 1:17:22
  Speaker 1: Napoleon never attacked in June, that kind of stuff, and
• 1:17:25
  Speaker 1: how it affected bad policy making in Vietnam. Huh, how
• 1:17:28
  Speaker 1: people missuse history and arguments. Ernest May he passed away,
• 1:17:31
  Speaker 1: but he was a giant in that field, so there's
• 1:17:34
  Speaker 1: no such thing as a bad Ernest May book. Um.
• 1:17:37
  Speaker 1: In business strategy, I'm a Drucker guyck such of excellence
• 1:17:41
  Speaker 1: and absolutely just about anything you read. I'm a real
• 1:17:43
  Speaker 1: fanatic search of excellence. Tops. I'm a value investing nut.
• 1:17:47
  Speaker 1: My two favorites I think would be well both the
• 1:17:50
  Speaker 1: Graham stuff and I like Monger's stuff too. And Steph
• 1:17:53
  Speaker 1: clam and his friend of mine actually have a copy
• 1:17:56
  Speaker 1: of Margin of I have a PDF of it, but
• 1:17:58
  Speaker 1: I don't have the physical copy, which now go for
• 1:18:00
  Speaker 1: like three thousand dollars. Yeah. Luckily he was a friend
• 1:18:03
  Speaker 1: and I cornered him in his office, found the drawer
• 1:18:04
  Speaker 1: and he sent me once. But anyway, yeah, yeah, so
• 1:18:07
  Speaker 1: I I uh, I like that. I I'm a big
• 1:18:12
  Speaker 1: student of Cold War history because that's, you know, originally
• 1:18:14
  Speaker 1: what I studied. So yeah, a lot of historical stuff.
• 1:18:17
  Speaker 1: And um, let me ask you my two favorite questions
• 1:18:20
  Speaker 1: to wrap us up. So a millennial comes up to you,
• 1:18:23
  Speaker 1: someone who just graduates college, and said, hey, I want
• 1:18:25
  Speaker 1: to get into the political consulting game. What sort of
• 1:18:27
  Speaker 1: advice do you give them? I say, start out trying
• 1:18:30
  Speaker 1: to run a campaign locally to learn politics. Don't go
• 1:18:33
  Speaker 1: to d c Uh. It's not where you're gonna learn
• 1:18:36
  Speaker 1: anything other than build a network to get a job.
• 1:18:38
  Speaker 1: But then you become a guy with a job and
• 1:18:40
  Speaker 1: no knowledge, which is we have enough of you can
• 1:18:42
  Speaker 1: get called congress. Get there later. When in doubt you
• 1:18:44
  Speaker 1: want to learn politics, go work in the state capital.
• 1:18:47
  Speaker 1: Oh really, that's very interesting. And our last question, what
• 1:18:51
  Speaker 1: is it that you know about politics and campaigning today
• 1:18:55
  Speaker 1: that you wish you knew thirty years ago? Pulling his
• 1:19:00
  Speaker 1: were rated digital was not only going to become big,
• 1:19:04
  Speaker 1: but it was gonna eat everything. To quote Mark andreson
• 1:19:08
  Speaker 1: Um and that this bite the flashy technology, including digital,
• 1:19:15
  Speaker 1: Never forget it's narrative storytelling and win in doubt. Trust
• 1:19:19
  Speaker 1: that more than anything else, Mike, this is being middle
• 1:19:22
  Speaker 1: and end of story. This has been really fascinating. The
• 1:19:25
  Speaker 1: timing couldn't be better. If people want to find your
• 1:19:28
  Speaker 1: your writings or your radio show, they go to. Sure,
• 1:19:32
  Speaker 1: I got a couple of things. I'm on Twitter at
• 1:19:34
  Speaker 1: Murphy Mike Radio. Free Gop is my weekly podcast, which
• 1:19:38
  Speaker 1: is a lot of fun. We're doing pretty well with it.
• 1:19:40
  Speaker 1: And I've got a website that is needs to be
• 1:19:43
  Speaker 1: updated a little, but I stuck all my commentary writing
• 1:19:45
  Speaker 1: there and it's called Mike Murphy Commentary dot com. So
• 1:19:50
  Speaker 1: for those of you who have enjoyed this conversation, you
• 1:19:53
  Speaker 1: can look Up an Inch or Down an Inch on
• 1:19:56
  Speaker 1: iTunes and see any of our other hundred and nine
• 1:19:59
  Speaker 1: or so UH podcasts. I would be remiss if I
• 1:20:02
  Speaker 1: did not think Michael Batnick, my head of research, Taylor
• 1:20:06
  Speaker 1: Riggs are booker. H Charlie Vohmer our engineer. We love
• 1:20:10
  Speaker 1: your feedback and comments. You can send us email at
• 1:20:15
  Speaker 1: m IB podcast at Bloomberg dot net. I'm Barry Ritults.
• 1:20:20
  Speaker 1: You've been listening to Masters in Business on Bloomberg Radio.