Author, Arabist, Son, Spy
A Podcast with David McCloskey, Ukraine Case Study, Market Update
If you are new to these essays, welcome. My name is Paul Podolsky and I am an author (Raising a Thief), investor (former Bridgewater Associates), journalist (Wall Street Journal, Dow Jones Newswires, others) and Russia and China specialist. You can read more about me in the “about” section.
To my US readers, Happy Labor Day weekend and to the everyone else welcome to the Season #5 podcast! I am genuinely excited to share our guests over the fall. Today, we release my conversation with David McCloskey who is a former CIA spy, Syria analyst and writer. If you like thrillers, I recommend his book Damascus Station.
Below are a few things I took away from our conversation. Listen to yourself here.
We are intrigued by things that are secret. In a hyper-transparent world, there are less and less topics that qualify, but spying is one of them.
You can’t understand the world if you don’t understand spy agencies. They are a modern reality. The CIA dates to 1947 and versions exist in most major countries. I appreciated David’s candor about the reality of espionage. He recently tweeted about a morning in 2011. “In the AM I watched real time drone footage of an adversary’s military base and in the PM I went upstairs and there were no staplers and it took weeks to get one.”
You can’t make sense of what is going on in the world without understanding that states fail. A failed state is in the range of human experience even if it’s not your personal experience. In David’s case, he watched Syria implode. This matters both in terms of accurately perceiving reality and, for those of my readers who are investors, knowing the range of outcomes. Stocks for the long run? Not a good idea in a long list of countries.
Once a state begins to implode, moral choices get particularly tricky. Take Russia today. In Russia, even calling the war a war, not a special operation, lands you in jail or worse. David’s book describes the moral choices of his fictional characters in Syria, often a decision is between least worst options.
Certain professions require extreme mental gymnastics. David was not a spy who changed his identity, people who are called “case officers,” but his main character is one. For certain people at work as I write this, their day begins by remembering that they are supposed to be someone else. What motivates such people? In part the notion that “I’m winning because I’m in the shadows and you don’t know where I am,” David said.
We also spoke about writing and the creative process. David and I are each fans of leaving out the boring parts. He describes the challenge of facing a blank page followed by the excitement of having created something from nothing.
Finally, David had a great life lesson. I won’t say what it is. Listen to the podcast and find out for yourself. What surprises me in the 40 or so interviews that Still Press has conducted is that everyone’s life lessons are different and they are all useful.
Ukraine Case Study
Regarding Ukraine, you can see what’s in the news—a stalemate, staggering human losses, a new Ukraine counter-attack in the East near Kherson. This new music video captures the mood. I share a case study below because it illustrates the power of open societies versus closed ones. Before I share the specifics, some context.
By closed societies, I mean top-down countries run by “experts.” In such places disorderly, voluntary association is not only unlikely, it is actively discouraged. Thus, the tension between the Catholic Church (voluntary) and the Chinese Communist Party (top down). The European Union is voluntary (Ukrainians are literally dying to get in), the Soviet Union was not. Emigration to another country is also voluntary association. I’ve always been more confident in voluntary, bottom-up, than top down because bottom-up rests on individual initiative and personal responsibility and thus touches on basic survival instincts. Likely some combination of growing up in the US, reading de Tocqueville and watching the Soviet Union collapse early in my career reinforce my view.
Here is the case study. A family emigrated from Belarus, Russia’s authoritarian neighbor, to Connecticut. The father is a programmer, mom is too but chose to raise their kids and dog. They struggled to train the dog. Being techies, they looked on line and found a master dog trainer in Ukraine whose videos were in Russian. They followed his advice and stayed in touch. A few years ago, the trainer moved his family to Irpin, just outside Kiev.
As the Russian tanks rolled in, the Connecticut family reached out to the dog trainer’s family over WhatsApp. “Anything we can do to help?” The answer: "save my son.” Never having met the son, the Connecticut family snapped into action. What followed were a flurry of emails, a trip via train and plane from Ukraine to Poland to Mexico to the US. Along the way, lawyers working pro-bono, a therapist and many others pitched in. The son is now in a Connecticut high school, safe from harm. The final stage was getting him a Social Security number. A woman from the State of Connecticut helped the family cut through the red tape. “Why are you helping us?” asked the mom. “I’m from Bosnia,” said the woman. “I’ve been through it, too.”
No one instructed these people what to do. They were able to distinguish good from evil and acted. Putin needs to force Russian troops to kill Ukrainians. The odds of that succeeding against a broad-based voluntary response like the one above seem low. It is this same instinct that is motivating Ukrainian fighters and the flow of Western weapons. Yes, there are plenty of times when evil triumphs over good. And based on captured conversations among Russian soldiers, they hardly seem to suffer moral pangs and polling data indicates most Russians support the war. Still, I am hopeful.
Polls
I’ve run a few polls in recent weeks and I share the results today. In Post-Destructive Leaders, I asked how important it was that Trump face due process. Answer: 87% believed it was important. In Ego, Self-Doubt and Survival, I asked what held people back. Answer: 71% said too much self-doubt. In Cliff Notes to the Next Chapter, I asked how many people thought the stock market had between 10% and 30% more to fall. Answer: 95%. Answer: as of this writing, the stock market is 3% above its level on that day.
In today’s poll, I’m interested in the concept of “enough.” For many people reading this, they are the wealthiest people in history relative to previous generations. They have clean water, electricity at the flip of a switch, quality medical care, a surfeit of information and the ability to travel anywhere in the world. Yet, there is also a sense of needing “more.” So what defines enough? I suppose it very much depends on what struggles you currently face, though the poll will help us see the truth.
Investment Implications
My view is that
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