And people really, its been a big hit. We launched it a few years ago. It has vastly exceeded our expectations in terms of volume. Rose and we conclude this evening with bob costa the Washington Post, talking about the state of the president ial race as of today. Increasingly in conversations with people at trump tower, its a narrow path. They acknowledge that privately. Trump seems to almost acknowledge it publicly at times that its difficult. Because when you look at a state that trump has long wanted to win like pennsylvania, secretary clinton is well ahead. A state like North Carolina, she remains ahead. I place where trump had been up, iowa, its now very tight. Rose jeff bezos and bos costa when we return. Funding for charlie rose is provided by the following and by bloomberg, a provider of multimedia news and Information Services worldwide. Captioning sponsored by Rose Communications from our studios in new york city, this is charlie rose. Rose jeff bezos founded amazon in 19 9d 4 out of his garage as an online book seller. Today it is among the worlds most valuable coopanies. He is one of the worlds richest people, second only to bill gates. Amazons ambition is to sell everything to everybody. Amazons reach spans well beyond its retailing roots. Amazon web services is a leading company in the cloud. In january amazon became the First Digital streaming service to win a golden globe for best tv series. Jeff bezos has many passions, he surrounded the aerospace ompany blue origin to lower the cost of space travel and increase its safety in 2013, he purchased the Washington Post. I met with him earlier today at the Economic Club here in new york. Here is that conversation. What is it that amazon wants to be . Well, there are a couple of answers to that. Probably the biggest one, the best way, if i have to choose the best way to answer that question is the thing that connects everything that amazon does is the number one our number one conviction and idea and philosophy and principal principle which is customer obsession, as opposed to competitor obsession. And so we are always focused on the customer working backwards from the customers needs, developing new skills internally so we can satisfy what we perceive to be future customer needs. We have a whole working backward pros ses that starts with the customer needs and works backwards. So that is really, if you look at, seems like we are in a bunch of different businesses. So we have Amazon Web Services which is completely different from our, you know, amazon prime business or amazon market place, or Amazon Studios, and so on. But really, the way that the businesses are run is very, very similar. And it all starts with, its not just customer obsession, that is the number one one. But we have a very inventive culture, so we like to pioneer invent. There areeau very effective business strategies. Pioneering is not the only effective business strategy. In fact, some people would argue it is the the not the most effective one, close following is very effective and worked many times if you look at business. But it isnt who we are. Willingness to think longterms. I think that is another Common Thread that runs through every single thing we do. We are very happy to invest in new initiatives that are very risky, for five to seven years which in most Companies Wont do that. Companies will invest for very long periods of time, and they should in those cases where the outcomes are more certain. Its the combination of the risktaking and the longterm outlook that make amazon not unique but special, in a smaller crowd. And then finally, taking real pride in operational excellence, so just doing things well, finding defects and working backward backwards, that is all the incremental improvement that in business, most Successful Companies are very good at this one. If you are not good at finding defects, finding the root causes of defects, fixing that root cause, you dont want to ever let defects work downstream. That is a key part of doing a good job in any business in my opinion. Rose you still want to sell everything to everybody. Yeah, for sure. We started, just remember, 20 years ago, we were selling only books. I was driving all the packages to the post office myself. I thought maybe one day we would be able to afford a forklift. And it is very, its very, very different today. But we, over time we added music and we added videos. And then i sent an email message out to the Customer Base about, actually a thousand randomly selected customers and i said besides books, music and video, what would you like to see us sell. And the the list came back incredibly long. It was basically just whatever the person had on their mind right now. One of customers said i wish you sold windshield wipers because i need windshield wipers for my car. I light kind of went on in my head. You know, people will want to use this new fangled ecommerce way of shopping for everything. Because people are very conveniencemotivated. And if we can do it, so that really started kind of the expansion into all categories, Consumer Electronics and then apparel and so on. Rose take one example, apparel, you now have i think outpaced macies as the largest apparel seller in the world. Yeah, i dont foa ive seen those headlines. I actually have not tried to track that. Back to not being competitor obsessed. But you know, we are selling a lot of apparel. And that team is doing a fantastic job. I do think, if were not the largest, were monk the largest apparel sellers in the world. And there is lots of room. You know, we keep improving. I think if you were to talk to our apparel team, they would tell you they dont think were very good at it yet. And still the business is going very well. So i am never disappointed when were not good at something because i think how well is it going to work when we are good at it. And the apparel is like that. There is so much opportunity. Nobody really knows how to do a great job of offering Apparel Online yet. And we have tons of invention and ideas and working our way through that experimental list. You said the market place, amazon prime and Amazon Web Services. Thats right. Lets go in reverse order. Amazon web services now is the largest contributor to revenue t is said. Well, not to revenue. Its a big contributor to profit. Our retail business, bay by the way, in our established countries is also very profitable. We keep investing so we are investing in video, original content with Amazon Studios and so on. But Amazon Web Services is a is remarkable thing for a couple of reasons. It follows all the principles that i laid out at the beginning. But one of the most unusual things that happened with Amazon Web Services is the amount of runway that we got, which is a gift, before we faced likeminded competition. We had it appears to me just imperically that if you invent a new way of doing something, typically if you are lucky, you get about two years of runway before competitors copy your idea. And two years is actually a pretty long way in the industry so thats a big head start. For whatever reason, and i have a hypothesis of what the reason is. But for whatever reason, Amazon Web Services got seven years of runway before we faced likeminded competition. There were other people doing similar kinds of things but not the same way and not with the same approach and same mindset. And in my experience, thats unheard of to get so much runway. And i think the reason that that happened is because the incumbents in technology for enterprises, sort of Infrastructure Technology for enterprises thought that what we were doing was just so damn weird that it could never work. And so we just kept very quiet about it. And we knew it was working, you know, and we would read news stories that would say things like, do you really think anybody is going to buy Mission Critical enterprise infrastructure from an online book seller . And we would look at that, you know, and certain people were opining on that and we would read those articles and we would look at our business statement and we would be like well, we are. We do. So we kind of knew. But it was, so we got very lucky. That was the gift. And what that allowed us to do was build a gigantic advantage in terms of the feature set and the Service Offerings and the cost structure, and Everything Else, that you just cant wave a magic wand and do that quickly. It takes years and years. But the Central Point seemed to me. And now were not stopping, so that team is, you know, every year, 500, 600, 700, 800 new features and services so they keep pushing on that. That team is just doing an amazing job. Whats interesting to me is that you were doing it for yourself, the same thing were you doing for yourself. You said if are you doing it for ourselves. This is true. So the founding idea behind Amazon Web Services is that our applications engineers and our networking and data engineers were spending way too much time coordinating. And so the applications engineers are the ones who build the things that customers actually interact with, they drive the business forward, they drive revenues. Building data centers and building, mut putting servers in the Data Services and putting fleets of servers and getting the right levels of capacity and making sure the operating systems were correct, databases on top of that, make sure the versions of those are correct, all the networking, this stuff is unbelievably complicated and hard, every bit as hard as building the application layer. But it doesnt really add any value to the application layer. Its a kind of price of admission. Its one of those things that has to be done perfectly but its not secret sauce. Its not going to change the way you run your business. And the and what we wanted to do was reduce those finegrained conversations with that the application engineers were having with the networking engineers. So we said we should just create a set of apis, application programming interfaces, harden those. And then the teams can discuss the road map next year, two years from now, three years from now, they can discuss in a coursegrained way the road map of what apis we should expose and then it will simplify those conversations and give everybody a lot of stability and they wont need to do all these silly finegrained coordination conversations. And so we started designing that. And the second we started writing it down, we realized wait a second, what were building here, we need. Amazon. Com, the retailer needs these things. But pretty soon everybody is going to need these things. And so with a little extra work, we can turn what we were going to build just for ourselves into a service for the world. And thats what we did. And it is now, you know, very successful, large. Rose its largest factor in the cloud. By far. Rose and cia and a lot of other clients come to you. Yes. Rose so you are also have a large shipping contingent within your own operation. Yes, we do. We do billions of packages a year and it takes a lot of logistics. Rose so you are getting into its shipping business. We have an a plus team. Rose so is it the same model. Are you doing something and are you doing it we could do this for other people so were going to get into the shipping business . Not quite. Its little bit different. Here were really being driven by capacity needs, especially if you look at the holidayselling season. The fact of the matter is that we need all of the capacity that we can get from the established Transportation Providers like u. S. Postal service,u pf. We will take all the capacity that they can give us. And i am just talking about the u. S. The same story is playing right around the world, the royal mail and deutch post and so on. And then in addition to that, we need more capacity, especially at peak. Just in order to continue to grow our business. So we have kind of been forced into developing expertise in te last mile. And of course we do use it for our Third Party Business so Third Party Sellers can now use the market place. We offer a Service Called fulfill by amazon where Third Party Sellers can put their inventory in our fulfillment centers. And then we handle all of the fulfillment and returns and Customer Service and Everything Else for them. And so we where, you know, that logistics chain is going to work for us, and for Third Party Sellers. And its really crucial that we continue to build that out. Rose so fedex andu ps need not worry. No, no. If you look at those guys are going to be able to continue to grow and were going to continue to grow with them, and just, and still need additional capacity. Rose the other thing is amazon prime, the second pillar, amazon prime, some what, 65 million members of amazon prime. We dont reveal that. So i dont want to nod. laughter . Rose amazon is reasonably secretive. Well, we we we dont want to reveal things that will help competitors or alert them. And its also just really hard to figure out which things would help them. You know, like we certainly got a bigger window, i was talking about our aws business and how we bot such a long runway. If we had been out there brag being that business, we would have attracted attention from incumbents, much sooner than what actually happened. And so there is no reason in business usually to boast about your accomplishments. People will figure them out. Boasting about the number of prime members wont make anybody more likely to join prime, in my opinion. Its people already know that a lot of people are prime members. Their friend rass are already prime members. Its true that in consumer businesses and in Enterprise Businesses that people, to some degree, like to be with the leader and like to be in the crowd. And so you do want people to know that you are a leader. You do want people to know that the offerings are successful and that lots of people are using them. But you dnt have to quantity fie that for consumers or enterprises. Rose lets assume it is a large number. Its a large number. Rose why is it so crucial for your future prime . Well, prime is, what we want prime to be and what we have developed it into over time is, its the best of amazon. So you can get basically if you join prime, we want to have our core service be outstanding, and anybody who wants to use amazon and not be a prime member should have a great experience. And people who are not prime members, for example, can still get Free Shipping. They have to buy a certain number of products or get above a certain product kind of order basket hurdle, i think its 49. And if they get above that 49 hurdle, then they can get Free Shipping. And so what we did with prime is say look, you know, you can get Free Shipping without joining prime but if you want fast Free Shipping, our best service, then you need to join prime. Rose its 99 a year. 99 a year. And then we started adding other benefits to it that we know that people like. So we started out we added prime video which has been a very successful new benefit for prime. We started many years ago. We added just 10 or 20,000 shows. And they were all licensed and they were all reruns. Things like gilligans island. And it was kind of a by the way offering. So you know we said look, you already are a prime member. Here is a new benefit. We know its not the most important tv shows in the world. But it also isnt costing you anything extra. So it grew. Now were doing, you know, Emmy Awardwinning and golden globe awardwinning original content that again, you get access to just at no additional charge, just being a prime member. Rose so getting too the creative part of the entertainment business, what was the motivation for that . Well, from a business point of view. There are two different ways to think about that. We always start with the customer centric point of view. So how can we, if were going to make original content which Amazon Studios is doing, how can it be better or different from the so much content that is out there that you could license already and not have to make yourself and the fact of the matter is that the over the Top Streaming Services with a subscription model can, in fact, make different kinds of content, so a show like transpatient which has won Golden Globes and emmys is not ever it is not a show that could be successfully done on broad broadcast tv. Because broadcast tv needs a much bigger audience for that. Transparent, we want to make shows that are somebodys favorite show. And on broadcast tv, you can be very happy if you have a big show that is, you know, 20 million peoples third favorite show. And so you can actually think about the Creative Process a u can attract different story tellers. You can go for stories that are narrower but incredibly powerful and well told. Mozart in the jungle is the same way. I dont see how moz ard in the jungle, another one that won Golden Globeses, emmys. I dont know how it it could be successful on broadcast tv either. So you get we can attract a story teller who wants to tell a certain kind of story. Then there are other things that are just tailwinds in this business, that are happening because of hbo and netted flicks and others, that you know, ten years ago you couldnt get a list talent to do tv. They perceived it as stigma advertising. And today that is just completely not, today a list talent wants to do serialized tv. Because the quality of the storytelling is so high, that is just completely flipped on its ve a presence in entertainment and the fact that you went. Totally. Rose you sell things because because you win awards it in hollywood. There is the Customer Experience part of you know, we want story tellersers with gs and taste to do things that are somebodys favorite show. And then lets talk about the business side of that. Why, these shows are expensive. Man in the high castle which is our most watched and one of our highest rated shows, and you should watch it if you havent seen it, hitler won, world war ii, an alternative history, and its 19d 62, and the nazis control the east coast and the japanese control the west coast. Its creepy. And but that show is super expensive to make. And so how do you pay for that content . Thats the business side of this. Rose right. The business side is very unique to amazon. I dont think i done think theres another model out there like it. And that is when you become a prime member, you buy more from us. You say to yourself, well, what else now that i have paid my 90 a year, how else can i use this membership. So when people join prime, they buy more shoes, they buy more diapers, they buy more dish washing detergent, they buy more books and electronics and toys and so on and so on and so on. And so we really want people to join prime. And we really want people to renew their prime membership. And so when we make, when we win a golden globe, for us, what we are tieing that to, and we can see we can see this in the metrics, that people who use prime video are more likely to convert from free trial lists to paid prime members and are more likely to convert from paid prime members, their next time, not convert but to renew for a subsequent year. And so thats what closes the loop on the business side. You dont do thingstfor business reasons. You need to do things for the Customer Experience reasons, but you need to know how are you tbing to pay for that Customer Experience. You need to close the loop on the business side too. Rose so i have listed three pilars. What might be the fourth pilar . Well, it could be, we dont know yet is the real answer. And i think its very hard to we do a lot of different things. And these things, the fourth one will rise and distinguish itself. Well put energy into many things. Im optimistic about things like Amazon Studios, so the original content, i think that actually could become a fourth pilar on its own. And i think that what we are doing with natural language understanding and ecoand alexa could become a fourth pillar. Rose everybody talks about artificial intelligence, everybody. And everybody is investing. And by the way, rightly so, this say real thing. Rose enlarge on that and also on the idea of what echo is and how it may very well be the beginning on the edge, the wedge into artificial intelligence, that benefits everybody. Well, echo is a small black cylinder that is it has seven microphones on the top and has a speaker inside, and a digital signal processor and some other computer inside. Its wifi connected to the cloud. And alexia the artificially intelligent agent that lives in the cloud will talk to you through alexa. I mean through eco. One of the interesting things about echo the device is it uses those seven microphones to do something called beam forming. And so basically it can hear you very well even in a very loud kitchen environment, for example. You have the ishwasher running and you have the sink Running Water and maybe somebody is playing the Television Set in the living room. And alexa can still hear you because of that digital signal processing. And so you can say alexia what time is it. Alexa what is the weather today. Alexia and in natural language, alexa play a certain song, et cetera, et cetera. And people really its just been a big hit. We launched it a few years ago. It has vastly exceeded our expectations in terms of volume. We have literally thousands of people dedicated to working on it. Rose and google wants to be in that business and everybody else wants to be in that business. Everybody will want to be in that business. Here you know we got the kind of standard, you know, two, two and a half year head start. Rose let me talk about the Washington Post. Yeah. Rose you bought the Washington Post without doing any due dill against. Were you so impressed with. Well, i did no due dill against because i knew don graham, for 15 years. Rose did he come to you because he needed a. If you any of you know don graham, is he possibly the most honorable person in the world. So he just laid out all the warts for me. He laid out all of the great things about the post for me. And no amount of due dill against could ever have gotten to more clarity than just talking to don for several hours. Rose why did you buy it . I bought it because its important. So i would never buy a financially upside down salty snack food company. You know, that doesnt make any sense to me. But the Washington Post is important. And so it makes sense to me to take Something Like that, and i also i am optimistic. And i thought there were some ways to make it i want it to be a selfsustaining, profitable enterprise. I think that would be healthy for the post. And i think it can be done. And our approach is actually very, very simple. We need to go its hard to excue on and it will take time but at proach is simple. We need to go from making a relatively large amount of money per reader on a relatively small number of readers. That is the historic model of the post to a model where we make a relatively small amount of money per reader on a very large number of readers. That is the new model. Rose but thats your Business Model too, isnt it . That is the better Business Model for the internet era. And the post is unusual and this is one of the things from a business point of view why im so optimistic about the post, is that it can go from being it has historically been a local paper. A very good local paper. But it happens to be a local paper situated in the capitol city of the United States of america. And so it has its kind of geographic location is su pesh for converting it from being a local paper to a national and even a global publication. And so that, and thases the gift that the internet brings. To do national and global publication in the days of print, super expensive. You have to figure out how to have Printing Presses everywhere and distribution everywhere, physical distribution, very challenging. Today that piece is easy. To get Global Distribution in digital form is extraordinarily simple. Rose because it is an important newspaper in the nations capitol and most powerful country in the world, did you want it also because it would give you political influence . No. And i think one of the reasons that that don graham liked me as an owner is because he disn think i would polit size it. Rose yeah. And so you know, i think because it is in the capitol city of the United States of america, it should not be, you know, an you take the british model of newspapers and you know, you know the kind of left wing paper or right wing paper. And there are certain people who this they had bought the Washington Post would have converted it in one of those directions. And i dont think that would be healthy for the post or healthy for the country and plus in that respect, im also a good owner because im so damn busy. Honestly. Rose youre not hanging out in the newsroom. Have i to desire to medel. Have i no desire to opine on everything. Ptha or even for the editorial pages. And by the way, its a very difficult business that needs to be done by professionals. I sometimes get asked, you know, do you do you opine in the newsroom or get involved in newsroom activities. Im like, if you know if you know as i do now a little bit about newsrooms, will you see, it would be exactly the equivalent of me walking into a Surgical Theater while my son was having brain surgery and med eling with the brain surgeon. It doesnt make sense. These are supercomplex being the executive editor of the post we have marty baron who it my opinion is the best executive ed editor in the world. He and his team, this redoing an unbelievably good job. And again back to, you know, have i been talking about the Business Model of the post, to transition to this new way of having a small amount of money with per read we are lots of readers. The real reason this can work is because the post is creating rivetting coverage. And theyre doing it. They are. You cant, you know, turn around a restaurant with business techniques if thed into isnt gelicious. And we have delicious content you know, the post is just rivetting. They are killing it. I am so proud of that team. Rose people in my profession are great admirers of what the Washington Post is today under marty barons leadership. Especially in foreign coverage. Totally. And marty would be the first one to tell you this. It is his team. He put those people in place. And he has give enthem lots of kind of energy and theyre proud of the product theyre creating. The post also has a culture that, i also have no desire to change the culture of the post that would be so counter productive. They already have a great culture and it comes all the way you know t is decades old. And what you want to do with Something Like the post that has a very healthy decadesold culture, instead of trying to change it, you want to kind of uncover it and reveal it and burnish it. And the more ive gotten to know about the post, i realize the distinguishing feature of the post compared to some other very high quality newspapers is the post has more swagger. They are, they are swash buckling. But they are professionaller swash bucklers which is very important because nonprofessional swash bucklers just gets you killed. You cant do that am and they are just incredible. Rose blue origin. You and i said last sat last night with a former astronaut. That was very fun, scott kelley. Rose scott kelgy who was there at the International Space station for i dont know how many days. What is it that you hope to accomplish. In space. Rose in space. Well, this is, first of all, lets back up. This is a childhood dream. I fell in love with the idea of space and spatial exploration and spatial travel. You dont choose your passion, your passion to choose you. I so i am infectioned with this idea. I couldnt ever stop thinking about space. I have been think being it ever since then. And i just so again, you know, i did not, when i started blue origin which is the name of this space company, i did not make a list of all the businesses in the world where i thought i might get the highest return on invested capitol. And it was driven by passion and curiosity and the need to explore the things that i care about question have over time still a Brilliant Team they are now over 800 people at blue origin, we have a tourism vehicle called new shep aryd that flies like a regular rocket a nd lands on its tail. We have used the fame vek it is reusable. We used the same vehicle five times that is key too the business that slt absolute key, if you look at if you asked question why is spatial travel so expensive, there is one reason and its because we throw the hardware away every time after using it. It is all expendable. And even if in the past when we have done things that were sort of semireusable, they werent really what i would call apperrable reuse able because they are disassembled, inspected and put back together. So you can imagine how expensive air travel would be if after your hawaii vacation puget to hawaii and, well, they throw the 747 away, it is going to be really expinsive but it will also be super expensive if after you get to hawaii, they disassemble the whole thing, inspect every part and put it all back together again, that was the problem with the shais sput shut shuttle. So it is important you design it. The propel ants are incredibly low cost. People dont know this about rockets. I big rocket lets say it a a Million Pounds of propel ant, two thirds liquid oxygen, say 600,000 pounds or so of liquid oxygen. You know how much liquid oxygen kots, 10e krentds a pound that is 60,000 worth of liquid oxygen and then add the fuel costs in. Are you still talking about a few 100,000 dollars st in propel ant costs in one order of 60, 70, a 150 million dollars. So you had you get from a hundred million dollars, to dlt 300,000 of propel and t is simple, are you throwing the hardware away. And so its really not the engineering challenge involved in building a highly operable reusable vehicle is gigantic. If you can do that, it is a game changer. You changed everything. And now why, to your original question, that is the background. Right. I believe its incredibly important that we humans go out into space and the primary reason, if you think longterm about this is we need to do that to preserve the earth. So i am not im not one of the plan b guys. There is a conventional there is a kind of conventional wisdom that is quite common that one of the reasons that we need to go into space and settle another planet is as a kind of backup for humanity, you know f earth gets destroyed, at least we have this other place. And i dont like that thats not motivating for me. But, but what cuz i will tell you what we know for sure. We have now sent robotic probes to every planet in this solar system. We have taken close looks at the mall, and believe me, this is the best planet. It is not even close so what you need to do and if you look at, if you want a thriving, growing civilization, you want population growth to condition. You want a whole lot of things to continue. And i believe in the next few hundred years what will happen is we will move all heavy industry into space for a bunch of practical reasons. Ness it only is available half the time n Space Solar Energy is available 24 7. But the list of practical reasons why that. But you also have to build an infrastructure up there. Yeah, and thats why you need really low cost, you need to shrink the cost of lifting maps into space from earth by tours of magnitude. You need to reduce that cost by a hundred times and then you can do these things. And then blue origin is not going to do this all by ourselve. What i want to do with blue origin is build heavy lifting infrastructure that lowers the cost of access to space so that the next generation of entrepreneurs can have a dynamic entrepreneurial explosion in space. That is how we will move all heavy industry into space and ultimately earth can be effectively zoned, residential and light industrial. Rose finally, unlike the internet there was infrastructure there so when you jumped into the internet there was always infrastructure there. Arted with four people, andany that, we could only do, we built amazon because we didnt have to do any of the heavy lifting. The transportation and Logistics Infrastructure of the u. S. Postal service which would have been hundreds of billions in cap ex, already existed. We didnt have to build the internet, it was run on Long Distance cables that were actually put in the ground for longdistance phone calls. And we didnt have to build a payment system, the credsity card system already existed. So all these things would have been tens of being billions or hundreds of billion in cap exand we got to rest on top of them. Thats why you dont see entrepreneurial dynamism in space like you do on the internet. On the internet, two kids in a dorm room can take, change an industry completely. And you cant do that in space. The price of admission is too high. Because the just getting to space is so expensive. And so if we can change, if im 80 years old, looking back on my life and the one thing have i done is make it so that there is this gienic entrepreneurial explosion in space for the next generation, i will be a happy, happy man. Rose one other thing i want to say before we g next question, you and bill gates got togetherred and started something called a company fietding cancer. Yes. Rose and the idea is. The science of that is unbelievable. And baiferl you can sequence, tumors shed little bits of dna into your blood stream. And you can use sequencing technology to amplify those things. And then detect cancers very, very early stages. And for a lot of cancers Early Detection is a big deal. So this is the science of this is very promising, very real, and it might not work. The market. But it might. And im optimistic. The market cap. If it does work, its a big, big deal. The market cap of amazon has made you the second wealthiest person in the world. Second to bill gates. Can you imagine at some point in your life pursuing the kind of philanthropy . Well, yeah. If there is anything left after i finish building blue origin. Well see. Again, i did not choose blue origin based on you know, basically what i am doing right now is taking my amazon winnings and investing them. Every time you see me sell stock on amazon, it is to spend send more money to the the blue origins team. Rose i asked jeff last night at the natural mu plu seem of history. What was the return on blue origins, he slapped me, that is a very rude question. That is i a very rude question. And i do believe blue origin can be a sustainable, profitable enterprise some day. But that is as an investment horizon would make most reasonable investors sick to their stomach. But by 2018 they will be up o be a vessel. We are on track to fly passengers, hopefully n2018. I keep telling the team, its not a race. Well do it when its safe. But were on track for 2018. On behalf of everybody in this room, and the Economic Club of new york, thank you jeff bezos. Thank you, charlie. applause the president ial nominees are entering the last full week of campaigning before america goes to the polls. Our sense of where things stand, bob costa of the Washington Post joins me in washington. Thank you for doing this. Let me begin with this question. Do donald trump and his people see a pathway to victory on election day . If is a narrow path, they acknowledge it privately. Trump steams tok a j no it publicly at times because it difficult. When you look at a state that trump has long wanted to win like pennsylvania, secretary clinton is well ahead. A state like North Carolina, she remains ahead. I place where trump had been up, iowa, its now very tight. And what is really hurting trurch and his strat strategist is when they look at a state like arizona where trump will head this weekends, georgia, and utah where there is a large mormon population, those are states republicans traditionally win and they are falling behind. The states they feel best about, florida and ohio, those are swing states that they feel they are the working class voters, white voters in those states will come out in perhaps record flms. Rose do they have any, any optimism because the polls may be in some cases tightening a little bit in his favor . The thing that they feel most comfortable about and optimistic about is the clock. That if the election was held this week, he would likely lose. But because there is a sense that is he in some way, is he stabilized his campaign. After all of this cascading allegations of sexual assault, talking about sexual assault, sexual misconduct, he has been able to move away from those kind of conversations in most of his interviews, gone back to mainstream news organizations for interview this week. He has been pretty focused on the stump, talking about the economy and trade. You saw him go to his hotel in washington d. C. Down the street from the post, talk about his business experience in a low key way, so they feel kellyanne conway, steve bannon who are at his side that he has turned a cornary way from that chaos of all those reports and allegations. Rose and steve bannon thinks he can stroke the pop lism protest and make it come out in record numbers . It is something that is not so much based in evidence it is more of a gut instinct that bannon who has been following that breet bartd wing of the Republican Party for so many years, bannon has been fixated on trump as a brexit type figure, someone who comes outside of the partisan discussion in this country, not a right left figure but a true populist nationalist. And what you are seeing right now in the Republican Party is already were having conversations in my reporting, about what the gop looks like. Will it be more populist, nationalist moving forward. So regardless of whether trump wins, that bannon wing is already trying to assert itself as the real power center. Rose what du ti about all the talk that if if fact donald trump loses, he and bannon and his son in law will form this show new Television Company ta will reflect the views of the people that have been his most intense supporters . Bns its certainly possible. Trump himself in a recent conversation has denied it, to me and his people deny it but there are these conversations happening behind the scenes. The problem for people like bannon and trump himself is they think through what it it would look like should they lose is that the media environment, they acknowledge it has become so fragmented that the idea that trump could compete with fox or compete with abc, cbs, nbct doesnt really make sense. If it is anything t will look like what trump has been doing this week which has been facebook live, social media, having 40 to 50,000 to 100,000 people tuning in to a video stream to have trump talk that is done on the cheap, kind of a waynes world type operation. Rose but its done at the same time as a Network Evening broadcast, isnt it . It is. And there was chie ron below the trump surrogate as they talk through things. And it had, interestingly, notably the blessing of sorts to the Republican National committee, sean spicer, the chief strategist appeared on the trump broadcast. But this is the bannon model. Having covered steve bannon for nine years as they covered breitbart in the wake of Andrew Breitbarts death. He thinks targetedded, aggressive media could have a wide influence within this kind of fragmented environment were all participating in as journalists. Is obamacare going to be an issue for donald trump in the last remaining days of this campaign and can he make a strong case so that it will win him some voters when trump has been talking about the Affordable Care act its almost like is he checking off a box on a to do list, something he is mentioning it nis speeches, there is not a lot of verve there, he says he will preplace it and come up with a reform package but is he not consumed with the healthcare issue like the other issues. The people who have seized on the Affordable Care act and rise in premiums have been the down ballot republican candidates, those running for senate and the house, trying to get traditional Republican Voters to come out in droves even if they are wary of trump in North Carolina and pennsylvania and wisconsin, they are talking about obama care because they think that is something that gets suburban republicans out to vote. On the other side there is Hillary Clinton, how do you see, because are you looking at both of these campaigns, how do you see what she will do and try to do in the remaining days of the campaign . S about turn out for her. They look at the map clinton operatives, sur gases, they feel great, they think the map is favorable for her, dem grafnlgs are moving in 4er direction but she has to get close or near the level president obama had in 2012, 2008 not as easy but 2012, to get minority votes up to those kind of levels because that is the one vulnerability she has. In a place like pennsylvania where you have philadelphia, a million voters, majority democrat, heavily africanamerican, if you dont have strong turnout, and you had record White Working Class in the center of the state, that could be something that turns the election. So it is about getting its first lady out there, like she was on thursday, talking to voters, trying to get millenials excited and get minority voters excited. Rose do they expect more to come out in the wickist leaks disclosures. It seems like every day people in the clinton campaign, people in washington, journalists, you wake up and you check wikileaks and you wonder what is going to be there. Because it is not a weak story, it is an every day story, there is this pile published on wikileaks. There say buzz about is there Something Else that is really big, some kind of smoking gun or something that could come out. But at this point, based on my reporting, talking to clinton folks and democrats and trump people there is no real sense that there is going to be something that changes the whole election at this point. But you never know. Its something that is out there, unpredictable. If you look at the senate where do you think the senate will be if the vote was today . If the the vote was today, i think we would be looking at Senate Majority leader Charles Schumer from new york. If you look at pat toomy, he has done pretty some i had in his debates against katy mcgirnlty in pennsylvania but he won in 2010 and that was a yeefer year favorable to republicans and won by a razorthin margin, kelley aote is struggling, richard burr in nor carolina, republican senator establishment vntd really run aggressive campaigns. They are struggling. Portman in ohio looks safe to win. I think he is run the model campaign, when you look back, he started early. He recognized he needed to get on top of the pop lism. And get on top of trade, even if he didnt want to be linked to trump. Rose and the house . The house. Rose they need a turnover of 30, house members in order for there to be a change in the speaker. Thats right. I think the house is the most fascinating underreported part of this election. Rose i do too. Its just, charlie, its not something that is not just about who wins the majority here. You have a Freedom Caucus in the house gop, 30 to 50 members depending on the day. Without dont want to vote for anything. So ryan doesnt just need the majority, he needs a solid majority to keep power. And so if he has a majority f ryan loses 20, 30 seats and his majority is narrow, then he doesnt really have much power because hes going to have to get democratic votes on everything. So the big buzz in washington, when i talk to Top Republicans is that the house f ryan only has a narrow ma jortd in the house, does he actually run for speaker . Does he stay on . Does he want to be speaker in that kind of situation . It drove john boehner out of the speakership. It is an extraordinarily difficult job because the Republican Party, should they lose the white house, it they is chaos on the right of allut these different media groups, and activists, and Institutional Party being collapsed in its own influence, that continues win or lose for donald trump. Rose are we looking simply for the two candidates to simply make their way to the election day, that nothing dramically is going to happen, surrogates will be out there for the democrats as Michelle Obama was with Hillary Clinton in North Carolina. Were looking at a sense that this election, unless something dramically happens, will simply stay on the course its on . Yes. I think thats right. He it has actually been a quiet week, one of the quiest of the campaign, you had the Affordable Care act news and different battles. These candidates are spending post days going to two or three rallies a day, talking to voters, this he have mostly given up fundraising, they stopped fundraising there are a few events left for secretary clinton, its all about turnout. The one thing everything is paying attention to, in this newsroom and elsewhere is trumps questions of legitimacy of the election. There is a lot of talk on the right about vote monster monitoring and poll watching. The Trump Campaign tells me that they have an operation in place. Theyre going to make sure its legal in every state and voters arent being touched or they arent being interfered with. But this is something that has each campaign on edge. How is the Trump Campaign actually going to handle election day operations and does trump, should he lose, actually recognize the law . Lets take the second part. Is there any change in his position on that. He will decide later as to whether he will recognize the results of the American People on election day. He is taking it in a pretty lighthearted way, that is i guess one way to describe it you look at his comments thursday on the campaign trail, they said well maybe they should just give the election to him. This is someone who is joking around about it. This is typical for trump, im not trying to say it is some kind of five banner, five page headline. He seems to be entertaining the idea that this is going to be a rigged election. And he does it day by day and its riling up his base, riling up republicans about this prospect that there will be some se where. A and cleveland and how intoxicated is he still by the rallies and the cheering of his most loyal supporters . He loves it. When you watch trump on the trail this week, it is not so much trump speaking to a national audience, is he with his message on jobs when is he out of place in his d. C. Hotel but this is a political entertainer. Someone i think who will be remembered in history as one of the purest rally performers weve ever seen on the Republican Party, maybe Even National politics. I just keep looking back at my notes and the only one have i ever seen at this kind of level of charisma with a crowd is president clinton, bill clinton. And trump relishes these moments, thee crowds. Thats why he just keeps going back to the rallies. It say rally campaign. Rallies which drive media coverage. And then there is more rallies that sustain the media coverage. When is the last time, charlie, you talked about a trump ad. Maybe you see them in the swing state but it is the rallies and Cable Networks that are driving trumps message and how it gets out. Rose there was a certain intensity for obama in 2008. There was. Rose he was drawing record crowds in 2008. And i think obamas crowds in 2008, having covered it a bit for the journal then, they were record krowppeds. For trump t is not so much a republican crowd. I remember covering governor romney in 2012 and when you went to a romney rally in bucks county, pennsylvania, or somewhere else there were a lot of people in golf shirts and button down and cabbingees. The trump crowd is blue clar. This is blue clar, disengaged voters coming out for someone they think is change. Rose thank you so much. Thank you. Rose thank you for joining us. See you next time. For more about this program and earlier episodes visit us online at pbs. Org and charlie rose. Com. Captioning sponsored by Rose Communications captioned by Media Access Group at wgbh access. Wgbh. Org funding for charlie rose is provided by the following and and by bloomberg, a provider of multimedia news and Information Services worldwide. On the next newshour as the countdown to election day continues, mark shields and david brooks wrap up the weeks news. Must have soup the pancake is to die for it was a gutbomb, but i liked it. I actually fantasize in private moments about the food i had. I didnt like it. You didnt like it . Dining here makes me feel rich. And what about dessert . Pecan pie . Sweet potato pie