JEFFREY GOLDBERG: I want to turn to another source of excitement, Elon Musk.

And the first thing I want you all to do is watch this clip of Musk in the Oval Office earlier this week with his four year old son, X, who is named after his social media platform.

But watch this clip.

ELON MUSK, Department of Government Efficiency: I'm not sure we should be sending $50 million worth of condoms to anywhere, frankly.

I'm not sure that's something Americans would be really excited about.

And that is really an enormous number of condoms if you think about it.

But, you know, if it went to Mozambique instead of Gaza, I'm like, okay, that's not as bad, but still you know, why are we doing that?

JEFFREY GOLDBERG: So, Teddy, you're a Muskologist, among other things.

TEDDY SCHLEIFER: I'm an expert on whatever Elon's talking about right now.

JEFFREY GOLDBERG: Yes.

TEDDY SCHLEIFER: I don't think anybody is.

JEFFREY GOLDBERG: Yes.

But I want you all to sort of dissect that almost anthropologically or obviously politically, the whole scene is very unusual and that's an understatement, obviously.

When you saw that, what were you thinking about the relationship between Donald Trump and Elon Musk?

What were you deriving from that?

TEDDY SCHLEIFER: Well, right before that, Elon was saying like, I'll make some mistakes with things I say, but, you know, we'll fix it later.

And, you know, hold me accountable.

I don't think Donald Trump is planning on really holding this guy accountable.

I wondered that, you know, we might care that, you know, oh, he said Gaza, he meant Mozambique.

But like is there any public -- the only person who theoretically could be holding him accountable is not the kid on the shoulders, it's probably not really us, it's the person who's sitting a couple feet to his left.

And, you know, Trump during that entire press conference looked very bored.

He looked passive and disinterested and, you know, ready for him to stop talking, Elon to stop talking.

But at the same time Elon is obviously taking on more and more territory in Washington.

And I wonder whether or not Trump is just careless on this or is he going to wake up in six months and kind of realize what's happened, because I do not get the sense that Trump is prepared to really be minding the store of -- JEFFREY GOLDBERG: Well, you know, I mean, it's the big parlor game in Washington Trump and Musk even joke about this now.

When are they going to break up?

It's a Valentine's Day show.

We're talking about the relationship.

I'll ask you.

I mean, it doesn't seem like these are two stable isotopes, right, and a friendship built on mutual affection and respect.

They are very, very transactional people, and obviously very improvisational people.

Do you think that this is a lasting phenomenon?

TEDDY SCHLEIFER: I mean, given the way that I feel like the conventionalism in Washington is going to implode tomorrow, I feel contrarian to thinking it's going to last, you know, six months.

I mean, Elon is supposed to be there until, or at least be involved until July 2026 where he's going to put out this report, which is -- so that's, you know, a little over a year from now.

My sense of people, and this is informed based on some conversations with people in the Trump circle and in the Elon circle, is that there's a dependence here.

Elon has basically a -- has a celebrity that Trump really admires, genuinely.

You know, he has the like -- JEFFREY GOLDBERG: He also has more money than any other person in the world.

TEDDY SCHLEIFER: Yes.

And Trump is impressed -- he's very impressed by like going to see the rocket launched in Texas during the transition.

Trump doesn't know anything about this.

It's not like he's a kind of real estate or finance or media rich guy friends who Trump thinks like I know about this stuff.

There's also the sense that, you know, Elon is not -- like even if you kicked him out of the Oval Office there, like he has this platform, he has a cultish following with young men, who obviously have flocked to Trump too.

Like I don't really know what a divorce would even look like.

JEFFREY GOLDBERG: Right.

Steve, what did you make of that scene?

STEPHEN HAYES: Yes, I mean, everything Teddy said, plus, Elon Musk loves Donald Trump, and says it again and again and again.

He tweeted this last week, I love Donald Trump as much as a straight man loves any man, or something like that.

I mean, I'll paraphrase.

Look, I don't think he, I don't think Donald Trump brought Elon Musk in initially, because he wanted him to get something done.

It wasn't that.

It was because he supported him in the campaign, he liked having him around, he's impressed by rich and powerful people.

But Elon Musk has experience making things efficient and the prospect of bringing him in to make the federal system, the administrative state more efficient, I think, appealed to Donald Trump on sort of big picture level and really appealed to Elon Musk.

This happened, by the way, in the first Trump term, Trump 1.0.

There was a big deregulation effort, all of it sort of quiet, behind the scenes, very effective, where a bunch of policy wonks, big Republican donors had gotten together, put together a couple binders, given it to Donald Trump and said here's your deregulation plan.

And Trump wasn't very interested.

He's not a policy guy.

He's not a details guy.

He didn't care about limiting the size and scope of government.

But he said, eh, sounds good to me.

Put this team to work.

They were very effective in deregulating this campaign.

JEFFREY GOLDBERG: Are you suggesting, and obviously, White House correspondents, jump in here, are you suggesting that Trump doesn't even know what Musk is making more efficient?

STEPHEN HAYES: I don't think -- I mean at this point he's impressed by the stuff that Musk tweets, right?

I mean, you heard him -- Trump was sort of catcalling her or interjecting while Musk was explaining this and saying, you know, tell him about the woman who made $30 million dollars, and he loves that and he loves the attention.

But I don't think he's -- Donald Trump isn't doing this because he has any deep ideological or philosophical commitment to limiting government.

EUGENE DANIELS: You know, the press secretary this week, you know, held up in front of the press this kind of list, she called it a report, like a DOGE report.

So, they are getting some kind of report from the DOGE folks about what they're doing.

They have that account on Twitter.

Donald Trump has made a very clear, and Elon Musk has made very clear, that there is some kind of communication between the two of them.

But when I watched that video, and when you look at how the first Trump administration went, anytime he was standing next to anyone, they would all see the spotlight to him.

So, it's fascinating to see him do the opposite.

And I think there's two ways to kind of look at it.

One is the way that the left, I think, has been looking at it, according to X and Twitter, is that you have the president sitting at the table while Elon Musk is holding court, and that, in their eyes, diminishes Donald Trump in some way.

The other way that the Trump folks are looking at, and I think that is probably more accurate, is that the TIME Magazine Resolute Desk, you know, cover came out, and then Donald Trump invites Elon Musk to come.

He sits behind the Resolute Desk, I am the president, I am powerful, while allowing Musk with his son on his head and not wearing a suit, kind of hold court, right?

That and I think in Trump's eyes says, this is a staffer who is working for me.

Look at me.

I'm still sitting behind the Resolute Desk while he's talking.

JEFFREY GOLDBERG: Right.

NANCY YOUSSEF: Yes, I was just going to say, not only that, he gets to have Musk do the dirty work of getting rid of agencies or putting in DOGE and can have some distance.

He sort of has the big message and presents Musk as sort of the enforcer.

And so when we think about the timeline, I don't have the conventional thinking in terms of weeks or months.

I think it's until the midterms.

JEFFREY GOLDBERG: Right.

Well, Teddy, let me ask you this.

It seems like, well, there's a lot of the policies about which government agency to go after, why we don't like that particular government agent.

This seems to be being done on the fly, almost as if he's taking direction from followers on Twitter, on X. TEDDY SCHLEIFER: I think that's literally true.

TEDDY SCHLEIFER: I mean, I think that Elon Musk is literally driven by the 500 people that he follows on Twitter and that it is, you know, like there are.

And some of these people are pseudonymous accounts.

Like I know people who, during the transition, when they wanted Musk to support a certain candidate for a job would like try to get that information in front of one of those pseudonymous accounts to tweet nice things about that candidate.

Like I mean the people who -- I know it sounds ridiculous.

The people who Elon Musk follows on Twitter are some of the most important people in American culture.

JEFFREY GOLDBERG: They are literally sometimes anonymous accounts driving Musk's choices that are then endorsed by Donald Trump.

TEDDY SCHLEIFER: I mean you can see it on Twitter or on X when you know someone will tweet something ridiculous and not verified and then Elon will respond with, you know, interesting.

And then, I mean, that was funny maybe.

I don't know.

I don't know if it was ever funny, but it was smirk worthy a year ago, but now that information is then put into action and then suddenly the Democratic-elected president is doing whatever that guy said was.

JEFFREY GOLDBERG: Interesting.

Well, I want to suggest that it's not funny for a large group of people.

I want you to watch this one clip of Musk talking about this.

ELON MUSK: We do need to delete entire agencies as opposed to leave part of them behind.

If you don't remove the roots of the weed, then it's easy for the weed to grow back.

JEFFREY GOLDBERG: So, he is talking about, and this administration is talking about now, laying off, firing literally hundreds of thousands of government employees.

And, Eugene, they're talking about Americans who happen to work for the federal government as weeds that need to be uprooted.

Does this come back to haunt them in some way or is there so much anti-government fervor in the country right now that this is going to be widely accepted?

EUGENE DANIELS: Possibly, right?

And it may not come from the American people.

If Congress, who -- he's saying he wants to delete these agencies.

He cannot do that, right?

Legally, these have to be created and destroyed, I guess, by -- JEFFREY GOLDBERG: Yes.

But wait, he's done a pretty good job of deleting USAID, for instance.

It still exists nominally.

EUGENE DANIELS: It still exists, right?

He'd lead the organization.

And I talked to someone recently who got a letter that they were laid off and they're done at one of these agencies.

And what the letter had that their job was no longer in the public interest, right?

And so, which, you know, knowing the work that this person does, I don't know that that's true.

And so he sees it as his job.

He thinks that they have the backing of the American people because he spends so much time on X talking to these 500 accounts.

But at the end of the day, the legal process is still working itself through.

You know, you have Linda McMahon, who might be the education secretary today, kind of hemming and hawing on whether or not the Education Department will exist.

It was, put into -- it is by federal mandate from Congress, not from the executive branch that this exists.

So, if Congress, when they don't seem to be doing so, doesn't stand up and say, hey, you can't do that, Republicans aren't doing that, Democrats are, but they don't have any power.

JEFFREY GOLDBERG: Steve, you're a student of Republican politics, conservative ideology.

Ronald Reagan wanted small government.

STEPHEN HAYES: Right.

JEFFREY GOLDBERG: Is this really less dramatic than we think, or is this some kind of signal change between what Reagan sought and what Trump is doing?

STEPHEN HAYES: Well, I think it's different because it's Trump, right?

I mean, Donald Trump didn't campaign in 2016 as the guy who's going to reduce the size and scope of government.

It's just not who he is.

It's not what he believes.

And in many cases, he was willing to spend more.

He was responsible for $8 trillion in additional federal debt in a space of four years.

So, this is not consistent with what we've known about Donald Trump, but it is consistent with a critique that conservatives, myself included, have made of the administrative state.

It is out of control.

There is a lot of waste, fraud and abuse.

There are reasons to go through in a systematic way and do some kind of audit.

I think it's just this kind of audit, which, you know, to Teddy's point, this is chaos.

And I do think he's being responsive to what's coming on Twitter.

JEFFREY GOLDBERG: It's audited (ph) by Twitter, like Teddy has described it.

STEPHEN HAYES: Right.

And I think, just to go back to that point, if Musk got involved in this because he believed he could make this more efficient, and there are definitely ways we could make the payment systems more efficient, people have been studying this for years, I think he's now -- he loves the cutting and the gutting because of the feedback loop, because he's getting this.

You're not going to get a lot of people giving you high fives on Twitter or liking your tweet if you say, we really need to make the payment system more efficient, but you are, if you say, we're blowing up this thing.

JEFFREY GOLDBERG: I have a quick, I have a quick question for Nancy on this.

They might pivot toward the Pentagon, where you -- which you cover.

They get away with this in the same way that they're getting away with it at USAID?

NANCY YOUSSEF: No.

USAID had a budget of $40 billion and 10,000 employees.

Department of Defense is $800 billion-plus, 3 million employees, and so just the scope and scale of it is much bigger.

Moreover, USAID didn't have a constituency in the United States.

It didn't have legislators.

Their constituency were underserved communities around the world.

The Defense Department, their funding touches every part of this country.

And so, trying to sort of eliminate wholesale departments or parts of the age of the department is much, much harder and it has a national security element that there -- it has not been sort of vulnerable to these kinds of things in the way that other agencies have been.

So, there's already been hints even from Trump himself that you have to sort of trim things rather than sort of take a sledgehammer to some of these policies, JEFFREY GOLDBERG: Right.

Eugene, I want to talk about something that you're very deeply involved in at the moment.

The White House has decided to ban The Associated Press reporters assigned to the White House from Air Force One and from various Oval Office activities for refusing to call the Gulf of Mexico the Gulf of America.

You're the president of the White House Correspondents Association.

What do you have to say on that?

EUGENE DANIELS: Yes, I mean, I think, you know, we've released statements this week and the WHCA stands with the A.P.

because news organizations should be able to make editorial decisions, which is this, exactly what this is, without punitive reaction from any federal agency and especially from the White House without any kind of punishment.

And that is what we're seeing here.

And I think at the end of the day, it is also bigger than The Associated Press, right?

This is where this conversation is about the Associated Press.

We're watching The Associated Press being locked out of things in which they have been a part of for a really long time, decades, some longer than some of us have been alive.

But at the end of the day, this is about news organizations within the WHCA and around the world being able to make those editorial decisions.

JEFFREY GOLDBERG: What's Playbook's position on the Gulf of Mexico?

EUGENE DANIELS: You have to ask somebody else, I'm sorry.

But I think at the end of the day, they should be able to -- we should be able to make that same decision.

JEFFREY GOLDBERG: Right.

Does anybody else have any thoughts on that?

Because I don't remember, and you might, I don't remember another time when the federal government has tried to punish a news organization for a strictly editorial decision like that in that realm.

NANCY YOUSSEF: Well, I think we'd be remiss to not note that the vice president was in Munich today, gave a speech, and warned Europe that the enemy is within, and part of it is not allowing freedom of speech, and so on the same day, to be giving that speech, and then have this action taken.

And we should note, this is for not calling the Gulf of Mexico the Gulf of America.

Even in the A.P.

coverage, they note that the president has a different name, it's such a granular point to have this hill to sort of die on.

And I just -- I think it was striking to me that on a world stage, the U.S. was admonishing its allies and partners for freedom of speech and then within hours took this action.

STEPHEN HAYES: I think it's better to see this not as an isolated incident but as part of a long pattern from Donald Trump himself.

I mean, remember at the beginning of his first term, he gave an interview to Leslie Stahl and they were talking off camera before the interview and she asked why he constantly attacks the media.

And he said, I attack the media to discredit you so that when you say negative things about me, nobody will believe you.

JEFFREY GOLDBERG: So was this a setup?

Is this whole thing a setup?

STEPHEN HAYES: I mean, I think they're probably looking to pick some fights, right?

They're not going to lose -- this is something that sort of the MAGA world is going to cheer, they love this, stick it to these wire services, stick it to the mainstream media.

And at the same time, they're bringing in all of these alternative media sources, they've got their new chair, new media chair, they're bringing in other people to ask questions.

I think this is part of a deliberate campaign to undermine trust and confidence in the mainstream media and replace them with these alternatives.

JEFFREY GOLDBERG: Right.

I wanted to get to the Justice Department and Eric Adams, but we're running out of time, unfortunately.

I did want to ask, Teddy, on this general subject.

You cover a lot of the Silicon Valley oligarchy or billionaires, potentates, who have shifted right in recent years to Trump's benefit, obviously.

A lot of resentment there against the mainstream media as well.

TEDDY SCHLEIFER: Yes.

To some extent, I think it's almost more than Trump sometimes.

JEFFREY GOLDBERG: What is the root of this and what are the political consequences of this?

TEDDY SCHLEIFER: I mean, let's take Elon Musk, for example, just as the case study here.

I mean, I think a lot of this dates back to COVID.

It dates back to, you know, the beginning of him.

You know, he used to love the media.

All these people who were super wealthy, you know, have been praised and licked up and down and put on magazine covers for years.

And then what you saw was, you know, the rightward shift.

These people got really tired with COVID.

And now suddenly they feel that we're the enemy in a way I really do think it's -- I really do think some of the people I cover hate the media more than Trump does.

JEFFREY GOLDBERG: That's a disturbing observation.

I appreciate it, though, and I appreciate you sharing it with us.

Unfortunately, we do need to leave it there for now.

There's just too much to talk about these days.