Ep 132: Sen. Bill Hagerty on Saving Memphis & Designing Regulatory Frameworks for AI and Crypto

In Memphis a Soros‑funded DA stopped pursuing cases, homicides spiked, and it convinced me change was possible as momentum built with President Trump; the economy is racing toward a digital era powered by AI, but if we criminalize innovation or splinter rules, we’ll never reach the scale we need.

Welcome to American Optimist; Senator Bill Hagerty’s with us—a business‑minded leader, former ambassador to Japan—and we’re diving right into the shutdown: is there a real path to end it?

This standoff is raw politics, not policy; Schumer’s boxed in by his far left and wants to show maximal resistance to Trump, even as air traffic controllers, service members, border agents, and families relying on benefits go unpaid.

Can we get back to regular appropriations instead of last‑minute cram‑downs?

Yes—leadership finally agreed to bring bills to the floor, but Schumer long preferred back‑room omnibus deals, and Democrats even blocked moving the defense bill during the shutdown.

Friends say scrap the filibuster to end dysfunction—why keep it?

The filibuster forces bipartisanship and restraint; once Democrats gutted norms on judges and blue slips, it became nearly impossible to seat even consensus prosecutors in blue states, which hurts the whole system.

Let’s talk Tennessee—your Memphis push with the president looks like a surge that’s working.

Memphis has battled violence for decades, and a new DA’s non‑prosecution spiral demoralized cops, so I partnered with Democratic Mayor Paul Young and quietly built a federal task force to restore basic safety.

U.S. Marshals made the first big sweep, then we tripled FBI resources with DEA support, and after early wins President Trump opened the full playbook—IRS to hit illicit money, federal charges to bypass a lax local DA, and waves of arrests focused on hardened gangs.

What does success look like, and can you sustain it?

Pulling two to three thousand violent actors out changes the streets, and we’re committed to long‑term federal and state support as major employers like Ford and XAI invest; the goal is to make Memphis one of the safest big cities.

I heard you rescued kids too—true?

More than fifty missing children are back with family, many swept up after truancy rules vanished during the pandemic; people are starting to feel safe again, which brings businesses and families back.

Are NGOs and homeless‑spending reforms part of the fix?

Those issues are being addressed within the federal effort, and NGO activity tied to illegal migration is getting scrutiny.

Could you replicate this in cities where governors resist?

You need state cooperation, and some blue states cling to sanctuary policies because counting illegal residents boosts House seats and electors; I tried to fix it legislatively, but their caucus blocked it in a sixty‑vote Senate.

Quickly, your path from BCG to investing to public service?

BCG sent me worldwide and to Japan in the eighties, then I served as a White House Fellow with Vice President Quayle before private equity, where a dot‑com spinout delivered about a hundred‑fold return and launched my firm.

As ambassador to Japan, how did you view China, North Korea, and deterrence?

Japan anchors our Indo‑Pacific posture, and we pushed back on Chinese maritime pressure and calmed North Korean launches, but aggression surged again after Afghanistan; I expect tough, direct talks between Trump and Xi on trade and critical inputs with clear red lines.

You also sped up delivering U.S. weapons to allies—how?

Foreign military sales were mired in five to seven years of paperwork, so with President Trump, Secretary Mattis, and a Pentagon tiger team we ran steps in parallel and cut bureaucratic drag so allies get relevant systems on time.

On aid, what should DFC and USAID do differently?

Aim development finance at strategic markets and investment rather than feel‑good projects, align USAID spending under State, and give DFC the authority to actually compete for outcomes that advance U.S. interests.

You’ve led on crypto, especially stablecoins—what’s the plan?

The SEC’s murkiness drove builders offshore, so I’m pushing clear rules and a stablecoin framework with full Treasury backing to extend dollar leadership, alongside broader market‑structure legislation for certainty.

AI needs guardrails without a state‑by‑state maze—where do you land?

We can’t win this race with balkanized rules; enable scale in compute and data while protecting creators’ rights, and support massive investments in chips and power because the payoff is a true productivity boom.

After a fireside chat with Masa from SoftBank, I’m convinced specialized systems will reach super‑human performance and deliver real scientific breakthroughs, and the trillions flowing in look justified by the gains ahead.

My fear is we over‑criminalize it and stall the infrastructure that makes it possible.

It’s on us to clear a responsible path that protects people without strangling progress, and I’m working that balance even though it’s hard.

We built this show to fight cynicism—what are you optimistic about right now?

I believe America can lead with freedom and prosperity again—safer cities like Memphis, resilient supply chains, a strong dollar, and renewed confidence—if we choose leaders willing to stand up for what works.

With leaders like you pushing, that optimism feels earned—thanks for joining us.