As Canada and Europe Team Up Against Trump, Hegseth Unveils His RADICAL New Vision for the Military

Raging Moderates with Scott Galloway and Jessica Tarlov

Scott Galloway and Jessica Tarlov dissect the escalating global trade war initiated by President Trump's tariffs on Canada and the EU, highlighting how legal challenges and policy volatility are disrupting supply chains. The

Key takeaways

• Trump's tariffs face a third legal challenge under Section 301 of the Trade Act of 1974, yet American businesses themselves are pushing to stop them due to market instability.
• The EU and Canada are forging a comprehensive partnership covering digital trade, critical minerals, AI, and defense industrial base integration to counter U.S. trade aggression.
• Defense Secretary Pete Hegseth announced a 20% cut to general and admiral positions while establishing an autonomous warfare command, drawing criticism for identity-based dismissals rather than merit-focused reform.
• Scott Galloway argues that diverting resources from Ukraine to the Iran conflict was a catastrophic misallocation of capital that prolonged the war unnecessarily.
• Passengers and crew heroically subdued a co-pilot attempting to crash a Dubai-to-Tel Aviv flight, prompting discussions on mandatory national service and media framing of terrorism.

Main topics

• U.S. trade war and tariff policy
• EU-Canada strategic partnership
• Pete Hegseth's military reforms

Notable quotes

He's just the chaos president. He doesn't mind chaos... it really doesn't, it just creates tremendous insecurity.

Conclusion

The episode underscores a broader theme of institutional fragmentation and strategic

Transcript preview

Speaker 1 (0:03) Welcome to Raging Moderates. I'm Scott Galloway. And Speaker 4 (0:06) I'm Jessica Tarliff. Speaker 1 (0:07) Before we get started, it's finally October and the elections are just a month away. More than 700,000 Americans have already voted, with early numbers showing Democrats making up a larger share of ballot requests and key battlegrounds than they did in 2024. Will there be an October surprise? Will Democrats continue to surge? Subscribe to stay up to date and support the show. All right, let's bust into it. The EU and Canada are reportedly planning to announce a new partnership at the end of October, which would cover digital trade, critical mineral stockpiling, and more, all in an effort to defend themselves against Trump's trade war. Trump's outright ban on select Canadian goods, including alcoholic beverages, went into effect earlier this week after Trump said Canada is one of the worst countries in the entire world. Speaker 1 (0:55) OK. Meanwhile, for the third time in under two years, courts have once again been asked to rule on a set of Trump tariffs. Jess, let's start with the court's challenge to Trump's latest global tariffs, which would cover over 99 percent of U.S. imports. What's the challenge here? And more importantly, why does he keep trying? Speaker 4 (1:17) Well, because he's a petulant child is why he keeps trying. This time they're using, and they've done this before, Section 301 of the Trade Act of 1974, which allows the administration to investigate unfair trade practices and impose tariffs if they find that American businesses were harmed. What's so interesting about this is that it's the American businesses that want them to stop. So they're like, I'm going to go to court and I'm going to tell you how bad this was for all of my kids, right? the American businesses being as kids. And the kids are like, no, actually, we feel great. We would like things to stay just as they are. And this is the same panel of judges. They're actually, what, neighborly to me in downtown Manhattan that have ruled on this before. So expectation is you'll get the same result and it'll be a waste of everyone's time. But obviously it says something about President Trump's headspace when it comes to these tariffs and certainly how he feels about Canada, you know, saying it's like one of the worst countries on earth. We could off the top of our head, how many countries do you think we could list that are worse than Canada? I Speaker 2 (2:29) mean, I guess you'd have to pick what the barometer is for Speaker 4 (2:32) making something a bad country. Obviously, the really nice people who are happy to have, you know, free and fair trade with us and follow us into war aren't the ones that are making up one of the worst countries in the world. Speaker 1 (2:49) Yeah, this is, I mean, I've spoken a lot about this. Kicking your biggest customer out of your restaurant and just being rude to them just doesn't seem like a good strategy. And in addition, there's something, one of the most mendacious thing about this is I think he gets advised, you're going to lose in court. And his attitude is, I don't care. Speaker 2 (3:10) And Speaker 1 (3:11) I'll delay. Even after the decision comes down, I won't actually affect or comply with the decision for several days or weeks. The law is meant to be not only there to execute and ordain judgment, it's there to prevent people's actions through incentives that you will, if you do this, you're going to be found guilty or it's going to be overturned. And he doesn't care. And then when the decision comes down, he takes his time complying. And then this ridiculous notion that they care. This tariff regime is built on this forced labor pretext covering 86 countries. It's not trade policy. It's a legal argument to try and reverse engineer something to justify a decision he already made. And that is he's trying to backfill and find another reason to justify a decision, a rational decision. Companies can't plan. I mean, 13. That's the number of times he's changed the tariff policy against China since he came into office. So it's one thing to have onerous tariffs that make no sense or asymmetric tariffs, but businesses can't even plan against this guy. They don't know what rules they're going to be playing by next week. They don't know who to hire, who to fire, what suppliers to go with, what suppliers to avoid. So it's not... He isn't deploying a thoughtful... Speaker 1 (4:38) tariff or trade or even protectionist strategy. He's creating a Florida weather system that in the morning it's one thing and in the afternoon it's another. It really doesn't, it just creates tremendous insecurity. He's just, he's the chaos president. He doesn't mind chaos and the straight of horn moves such that no insurance company wants to insure of tanker. He's comfortable creating just total chaos across small and medium-sized businesses. which depend upon continued business with what has been our largest customer in the world at, you know, $875 billion, and that is Canada. It's just simply, but it's just no way to run an economy. Speaker 4 (5:17) What do you make of how quickly Canada and the EU are moving towards this pact? So there's going to be a meeting this month in Montreal, you know, when they put out the statement about what's going on here, you know. voluntary joining forces. We will create a tech alliance, integrate defense industrial bases, make the Arctic a flagship joint project. Crucially, we're going to work together on energy, critical minerals and batteries on AI. I don't know if they're going to update to SI, Speaker 1 (5:47) but AI, quantum, cyber Speaker 4 (5:49) and economic security. That's the whole shebang. I don't really know what else you could be doing with other countries. Speaker 1 (5:57) So most importantly, I've been to nine F1 races, and six of those nine, Jessica, were in Montreal. I love Montreal. It's great. Speaker 2 (6:07) I Speaker 1 (6:07) used to go for F1 every year, and amazing food, amazing town, amazing weather in July, Speaker 2 (6:14) and Speaker 1 (6:16) ridiculously hot women. Not that I noticed, I just heard. And this great street with great food. The poutine, Speaker 4 (6:24) those fries with the gravy and the cheese, I would die if I lived there. I would turn into a gravy drenched French fry. I Speaker 1 (6:32) think the first time I went was in maybe 2004 or 5, and I'd only been teaching for two or three years. And I was kind of wandering. I didn't know really what Claire Frankel would do with my life. And I thought, Montreal's awesome. I had one of the best weekends of my life, so I thought. So I called the head of the marketing department at McGill. And I'm like, could you use a marketing professor, eh? And I even thought about teaching at McGill. I was so taken with Montreal. And then I made the mistake of going back there in February. Not as charming. Speaker 4 (7:02) A little cold? Speaker 1 (7:02) Not. The weather in Montreal is awful. Like, Montreal is both cold and a lot of snow. Anyways, okay, back to our show. If you're in it, with respect to the EU-Canada potential partnership. If you're in an abusive relationship, it's not all of a sudden going on hinge doesn't seem that crazy an idea, right, to try and find a different partner. Speaker 2 (7:28) And Speaker 1 (7:28) when your biggest partner starts, your biggest trading partner starts banning your whiskey, you don't negotiate harder and you don't even know who you're negotiating against or what they're going to ask for. You just find a new drinking buddy. And that's what they're doing here. He is taking our biggest trading partners and he thinks he's getting leverage and they'll end up with a better deal. No, he's going to end up with no deal. Everyone, you know, those kind of cool graphics showing where the flow of ships is and how they reroute around the Strait of Hormuz and how patterns differentiate. By the way, I think the cost to go through the Panama Canal, I think they've raised the cost by 50 or 100x because all of a sudden the Panama Canal is jammed up because trade has been rerouted globally in terms of shipping. Trade on a dollar volume, it would be so interesting if Bloomberg or somebody could get a hold of where there's been settlement in dollars around trade. Because what I think is going, I know what's going on, is everyone's rerouting their business and supply chain routes around America. Speaker 1 (8:30) We're creating strange bedfellows. We're saying, hey, it's no longer a bipolar world with two-thirds of the world's economy as the US and Europe and some other powerful democracies. It's now, okay, it's the US, which is kind of pretty much standing alone. A bunch of democracies who feel like they can no longer count on the US, so they need to get closer and create kind of a third bucket. And then there's the, you know, I don't want to call it the adversarial bucket, but sort of Russia, China, North Korea. Speaker 1 (9:00) Iran. And we are, again, the term I just love, and I had Timothy Snyder on the pod, is that we're in the midst of a superpower suicide. Speaker 4 (9:12) There are now reports that we're having a NATO meeting next month that's going to be in Poland, and we are not inviting. certain NATO members. So this is apparently the realization of the naughty and nice list, because Christmas lives forever. So this is supposed to be a working group focused on NATO's future, and the United Kingdom, France, and the Baltics aren't being invited. And the guy behind this is apparently the Pentagon policy chief Eldridge Colby. I've seen back and forth about, like, is this really his call, or it's like a Hegseth call or a Rubio call. Trump call, whatever it is, that seems like a really bad development for the future of this alliance. And also those countries that are being excluded are enormous defense spenders right now. And we all admitted that it was a good thing that Trump told everyone in the first term, you know, you've got to be paying more of your fair share here. And now they are doing that. And they're certainly key players in the alliance. You know, think about the war, Ukraine and Russian aggression. Like, excuse me? They don't get to come to this meeting? And the other countries, I feel like, should say that they're not going to come unless, you know, one for all and all