0:00:04 There’s over 500,000 small businesses in B.C. and no two are alike.
0:00:05 I’m a carpenter.
0:00:06 I’m a graphic designer.
0:00:09 I sell dog socks online.
0:00:12 That’s why B.C.A.A. created one size doesn’t fit all insurance.
0:00:15 It’s customizable, based on your unique needs.
0:00:19 So whether you manage rental properties or paint pet portraits,
0:00:23 you can protect your small business with B.C.’s most trusted insurance brand.
0:00:29 Visit bcaa.com/smallbusiness and use promo code radio to receive $50 off.
0:00:31 Conditions applied.
0:00:33 Support for Prop G is brought to you by Viori.
0:00:35 Are you sick and tired of traditional old workout gear?
0:00:38 Viori wants to provide you with a new perspective on performance apparel.
0:00:43 Everything is designed to work out in, but also look and feel great outside the gym as well.
0:00:45 Viori’s products are incredibly versatile.
0:00:49 You can wear them running, training, stretching, or just lounging around.
0:00:53 Viori sent me the Elevate Core Shorts and Stratotec tee.
0:00:55 And I like the way they feel that form-fitting.
0:00:55 I feel strong in them.
0:00:56 I feel sleek in them.
0:00:58 I feel like a jungle cat.
0:01:01 Viori is an investment in your happiness.
0:01:04 For our listeners, they are offering 20% off your first purchase.
0:01:09 Get yourself some of the most comfortable and versatile clothing on the planet at viori.com/PropG.
0:01:13 That’s V-U-O-R-I.com/Prop G.
0:01:19 An experimental procedure that is giving hope to…
0:01:23 To get a heart transplant from a genetically modified pig.
0:01:27 There’s over 100,000 people on the organ transplant weight list.
0:01:31 And some scientists think the answer might be pigs.
0:01:37 Nobody in the world knew how a human would react to a pig heart, right?
0:01:39 The next day when we asked him, you know, “How are you feeling?”
0:01:41 He said, “Oink, oink.”
0:01:47 This week on Unexplainable, are pig hearts really the answer?
0:01:50 Follow Unexplainable for new episodes every Wednesday.
0:01:56 I’m Scott Galloway, and this is No Mercy, No Malice.
0:02:03 Some of the most iconic brands in history have seen their businesses crash.
0:02:06 Fallen Angels, as read by George Hahn.
0:02:24 The stock market is touching highs, but some corporate icons have seen valuations crash.
0:02:28 I believe dispersion, China, and a changing of the guard
0:02:31 are key to understanding these Fallen Angels.
0:02:36 In 1996, at the height of the brand era,
0:02:42 I was asked to address the board of Levi Strausen Company on the future of brands and retail.
0:02:46 The title of my presentation was The Death of Distance.
0:02:53 The rap was that brands need to establish direct relationships with consumers,
0:02:58 e-commerce, as digital technology would disperse products and services
0:03:01 without regard for existing distribution channels.
0:03:02 This happened.
0:03:07 Amazon dispersed retail to desktop, to mobile, to voice.
0:03:15 Netflix dispersed DVDs to the mailbox, then to every screen as net neutrality enabled them
0:03:20 to replicate tens of billions in cable infrastructure at near zero cost,
0:03:24 freeing up billions that resulted in a content price ratio
0:03:26 traditional players could not match.
0:03:30 The pandemic accelerated dispersion of the office,
0:03:36 remote work, healthcare, telemedicine, and education, online learning.
0:03:43 What I didn’t see, however, is that AI would be steroids for dispersion,
0:03:47 enabling anyone to leapfrog everyone.
0:03:49 Intel.
0:03:55 Moore’s Law, named for Intel co-founder Gordon Moore,
0:04:01 is an observation that the number of transistors on a microchip doubles every two years.
0:04:07 It’s a meme that encapsulates the relentless pace of technological progress.
0:04:10 When I graduated from the Haas School of Business,
0:04:16 Intel was the job everyone wanted, as the firm was surfing Moore’s Wave,
0:04:19 which was doubling in size every two years.
0:04:27 The Intel phenomenon could now be described as the ability to shed the majority of your value
0:04:30 despite being the leader in a booming industry.
0:04:36 Few firms have fallen so far, so steadily, as Intel.
0:04:42 At its peak in 2000, Intel’s market cap was $500 billion.
0:04:50 Since then, the S&P is up 243% and Intel down 80%.
0:04:58 If Intel had kept pace with the S&P, the firm would be worth 16 times what it’s worth today.
0:05:07 A stark reminder of this fall from grace, Jensen Huang, CEO of NVIDIA, is worth more than Intel.
0:05:15 The firm is at risk of being dropped from the Dow. Many icons disappear as everything
0:05:23 everywhere ends. However, this fall is extraordinary, as leading firms usually experience this type of
0:05:27 value destruction when they are helpless in the face of a sector’s decline.
0:05:36 This is on Intel as its market has boomed, with semiconductor sales increasing 18% globally year
0:05:46 over year and 21% in China. Intel’s brand and enduring legacy of Andy Grove mask what is arguably
0:05:55 the worst managed firm of the last 20 years. At the beginning of 2021, Intel and NVIDIA commanded
0:06:04 the same market capitalization. Today, the wizard behind the AI curtain is worth 30 Intel’s.
0:06:12 Intel missed dispersion, i.e. failed to capitalize on mobile and AI. While it remains the biggest
0:06:18 maker of processors for PCs and laptops, Intel no longer has the power to predict the future
0:06:25 by making it. The future belongs to NVIDIA. Five years ago, NVIDIA was a second tier
0:06:31 semiconductor firm best known for giving call of duty better resolution. Today, it’s the third
0:06:41 most valuable company on earth, with between 70% and 95% of the AI chip market. With a P/E ratio of
0:06:50 99, Intel is still likely overvalued, but the game’s not over. Intel is shifting its business
0:06:56 model to serve as a manufacturer for other chip companies, including NVIDIA and Apple,
0:07:00 that outsource the part of the supply chain that was supposed to be the ultimate moat
0:07:08 manufacturing. It ends up there are a lot of moats, slack supply, that can be rented.
0:07:16 In some, Intel aspires to become the picks and shovels of a market they once dominated.
0:07:26 TSMC, which has 60% of the foundry market, reported gross margins of 53%,
0:07:32 compared with NVIDIA, the leading pure play chip maker, which reported margins of 75%.
0:07:41 The front end branded chip has higher margins and is a much better business. However, at $100
0:07:49 billion in a market where CapEx rivals nations, Intel just needs to show a pulse to substantially
0:07:55 increase its valuation. Their key advantage is not their brand or IP, but that they have lost
0:08:03 so much value that they have much less to lose. Leveraging their brand and IP to be the best
0:08:10 house in a bad neighborhood could result in a dramatic increase in value. From here, Disney.
0:08:19 Hollywood is becoming a fair-weather Detroit. Less than 50% of all TV usage is attributed
0:08:26 to linear as streaming now dominates. Domestic film and TV production is down 40%.
0:08:34 The year before GM and Chrysler declared bankruptcy, their auto sales were off 23%
0:08:42 and 30% respectively. It would be convenient and more dramatic to claim this is because of AI.
0:08:49 It isn’t. The root cause is more pedestrian. Content budgets are up 3% this year,
0:08:59 but studios can find people to do the same thing for less money elsewhere. Half of Netflix’s $15
0:09:07 billion annual content budget is now spent overseas. Note, Los Angeles will not register
0:09:16 similar urban blight as, you know, weather. Disney, unlike Intel, can blame the weather,
0:09:24 or at least the atmospherics. Despite having 10,000 screens, AMC is not known as the largest
0:09:29 theatrical distributor, but a meme stock. In the past three years, Paramount Global
0:09:37 market cap dropped from $43 billion to $7.5 billion. Warner Brothers Discovery lost
0:09:45 two-thirds of its value in two years. YouTube, which spends zero on content as it splits revenue
0:09:55 with creators, accounts for 10% of TV viewership. Netflix is second, with 7.6%. But even the
0:10:00 streamers that leapfrog legacy media should worry about TikTok, which provides quick,
0:10:05 perfectly calibrated Dopa hits for two plus hours per day.
0:10:12 Amid all the wreckage of Hollywood is the once seemingly impenetrable Disney castle,
0:10:21 which has shed half its value as its P/E ratio dropped from 283 to 36 over the past three years.
0:10:29 If Hollywood is Detroit, Disney is Ford. Theatrical is in structural decline,
0:10:37 but Disney accounted for 42% of the global box office with only three films, Deadpool and Wolverine,
0:10:47 Inside Out 2 and Alien Romulus. Cable is dying, but Disney owns so much content, Hulu, ABC, FX,
0:10:54 ESPN, Marvel Studios, Lucasfilm, Pixar, 20th Century Studios, and National Geographic,
0:11:01 that its streaming services are becoming the new cable bundle. But even with price hikes,
0:11:10 access to the entire Disney streaming ecosystem without ads costs $159.99 annually.
0:11:22 A mid-tier cable package costs $1,380 per year. At the parks, operating profit dropped 3%
0:11:29 as attendance slowed industry-wide. Disney and Comcast, which owns Universal Studios,
0:11:35 blamed competition with international travel. At the low end, a three-night Disney World
0:11:45 vacation for a family of four costs $2,783. According to a recent survey, 45% of parents
0:11:53 take on debt for a Disney vacation. My take? Disney parks, similar to a Santa Monica producer of
0:12:02 reality TV content, cost too much for not enough. Disney recognizes this and announced a $60 billion
0:12:10 investment to improve the value prop. Pro tip? Deadpool ride. Nike.
0:12:19 Wearing Nike makes me feel stronger. I love Nike, especially the unapologetic brand positioning.
0:12:28 You don’t win silver, you lose gold. But after losing 50% of its value in three years,
0:12:34 Nike is nowhere near the metal podium. During the pandemic, running clubs boomed.
0:12:40 This should have been great news for Nike. Instead, it was a shot of adrenaline for Nike
0:12:49 competitors. Hoka sales were up 27% last quarter, while Q3 sales for on were up 46%.
0:12:55 Meanwhile, Nike’s former CEO, John Donahoe, blamed remote work for the firm’s innovation slowdown.
0:13:03 Donahoe represented a pivot to digital and direct to consumer. When Nike was my client,
0:13:08 I advocated for this strategy as dispersion would neutralize Nike’s best weapon,
0:13:14 broadcast advertising. But the fuel band never gained traction.
0:13:21 DTC revenue was down 13% last quarter, and ultimately Donahoe confirmed that Nike leaned
0:13:29 into digital and DTC at the expense of retail partners. A decision that hurt Nike as retail
0:13:35 returned stronger than expected post pandemic, and Nike lost touch with cutting edge smaller
0:13:45 retailers. And then China sneezed, and Nike caught full blown pneumonia. Fourth quarter
0:13:54 sales in China dropped 19%, and Nike warned investors to expect more bad news. This quarter,
0:14:00 Nike sales were down 10% year over year, and down 4% in China.
0:14:06 Still, there’s nothing wrong with Nike that can’t be fixed by what’s right with Nike.
0:14:11 Their new CEO, Elliot Hill, represents a return to the brand’s roots.
0:14:18 The stock popped 7% on news of his hiring, and then gave it back, see above sales down 10%.
0:14:27 And while this is an investment advice, Nike’s PE ratio has dropped from a 2020 high of 73
0:14:36 to 23, suggesting that the stock is undervalued. It’s going to take time, as this may be a board
0:14:41 problem. Nike, after shitting the bed on its earnings call this week, announced they would
0:14:48 no longer be providing guidance. This is just plain stupid and a rookie move from a great company.
0:14:55 When things are bad, you over communicate, and if Nike’s management team is so thin,
0:15:02 the board lets them punt on key information flows to investors, then they shouldn’t be in the S&P 500.
0:15:10 Estee Lauder At first blush, it’s easy to blame China for Estee Lauder’s
0:15:19 75% drop in market cap over three years. But Estee Lauder used that explanation pre-pandemic,
0:15:26 during lockdowns, and post-pandemic. Meanwhile, the global beauty market has been relatively strong,
0:15:35 growing 10% from 2022 to 2023, while China’s beauty market lagged, growing by only 3% amid
0:15:42 heavy price discounting. Estee Lauder, L’Oreal, and Shiseido have all struggled in China recently,
0:15:49 although Estee Lauder has struggled the most. But a bad economy isn’t automatically bad news
0:15:55 for luxury brands. The lipstick effect is a theory that says during economic downturns,
0:16:01 consumers on tight budgets still splurge on small, affordable luxuries, as such purchases give people
0:16:08 a sense of indulgence without breaking the bank. The question isn’t whether budget conscious Chinese
0:16:14 consumers have soured on luxury, but whether they’ve soured on Estee Lauder. According to Vogue,
0:16:22 it’s the latter. Proya is set to become the first Chinese beauty brand to hit $1 billion in revenue.
0:16:30 Chinese beauty brand Florasses will open its first counter in Paris. Direct to consumer brand
0:16:39 Uniskin launched its first brick-and-mortar store in Shanghai. The HBO show’s succession
0:16:45 was a modern-day Shakespearean drama that captured the essence of power, wealth, and family dysfunction.
0:16:51 Ostensibly, it was about Rupert Murdoch, but it also could have been about Sumner Redstone,
0:16:58 or the Estee Lauder family, which owns 35% of the company and controls 80% of the voting power.
0:17:05 Ultimately, this isn’t about China or navigating dispersion. It’s about the frailty of family
0:17:13 dynasties. Such dynamics make for good TV drama, but they’re lousy for shareholder value.
0:17:21 Similar to Nike, Estee has missed key trends and finds long-tail brands nipping at every appendage.
0:17:31 Dispersion and the rise of China both began in the 1990s. Three decades later, China is the world’s
0:17:37 second-largest economy, and it has more middle-class households than the U.S.
0:17:44 Dispersion is no longer coming. It’s here, and AI will take it in new directions.
0:17:50 Similar to Congress, there are just too many old people in corporate America clinging to power.
0:17:57 One of the key problems in America is lack of churn. Politicians, CEOs,
0:18:03 and tenured faculty refuse to leave, creating a stasis that is bad for the economy,
0:18:08 as our country is run by people who are out of touch, and reduces opportunity for young people.
0:18:16 If that sounds agist, trust your instincts. I am an agist, and so is biology.
0:18:24 At 73, Bob Iger is the oldest CEO of the Fallen Angels I discussed here.
0:18:30 His first, second, and third priorities need to be picking a successor.
0:18:38 At 60, Nike CEO Elliot Hill is the youngest Fallen Angel boss, and like Iger,
0:18:41 he came out of retirement to turn an iconic company around.
0:18:50 Pat Gelsinger, 63, started his career at Intel at 18. His mentor was Andy Grove,
0:18:58 a leading gangster CEO of the last century. Estee Lauder CEO Fabrizio Freida is 67.
0:19:04 He’s retiring after 16 years at the helm. Maybe it’s a vibe, as my kids say,
0:19:07 but a changing of the guard is upon us.
0:19:14 In January of 2011, Netflix was worth $11 billion.
0:19:22 By November, the company’s market cap was just over $3 billion. The reason?
0:19:27 As Netflix pivoted to streaming, it tried to spin off its DVD business.
0:19:34 The quickster backlash cost Netflix one million subscribers. As it turned out,
0:19:40 Netflix was right but early, as they ultimately closed their DVD business in 2023.
0:19:48 In 2012, Best Buy was on the brink of bankruptcy, and the big box sector looked doomed.
0:19:57 A year later, Best Buy’s market cap increased 3x as a new CEO led one of the biggest turnarounds
0:20:03 in retail history. And then there’s the turnaround story everyone knows. Apple.
0:20:12 We’re wired to overestimate the impact of negative events, a phenomenon known as the
0:20:19 negativity bias. It’s a cognitive distortion that makes us believe that failures have a greater
0:20:26 impact than they actually do. At some point, every business experiences a crisis, i.e.,
0:20:35 an opportunity. As a professor of brand strategy, I can’t help but wax nostalgic and believe these
0:20:43 firms are ripe for a comeback. They all boast global brands, talented workforces, and robust
0:20:51 supply chains. However, the most attractive thing about these firms is just how badly they’ve been
0:20:59 beaten down. In the first four weeks of 2024, Nvidia added the value of all four of these firms.
0:21:06 And that’s the bull case, as at some point every stock, unless it’s going to zero,
0:21:15 is just too expensive or cheap. These angels have fallen so far, redemption is overdue.
0:21:30 Life is so rich.
0:21:39 [BLANK_AUDIO]

0:00:04 There’s over 500,000 small businesses in B.C. and no two are alike.
0:00:05 I’m a carpenter.
0:00:06 I’m a graphic designer.
0:00:09 I sell dog socks online.
0:00:12 That’s why B.C.A.A. created one size doesn’t fit all insurance.
0:00:15 It’s customizable, based on your unique needs.
0:00:19 So whether you manage rental properties or paint pet portraits,
0:00:23 you can protect your small business with B.C.’s most trusted insurance brand.
0:00:29 Visit bcaa.com/smallbusiness and use promo code radio to receive $50 off.
0:00:31 Conditions applied.
0:00:35 Support for the show comes from ServiceNow, the AI platform for business transformation.
0:00:37 You’ve heard the big hype around AI.
0:00:41 The truth is, AI is only as powerful as the platform it’s built into.
0:00:45 ServiceNow is the platform that puts AI to work for people across your business,
0:00:48 removing friction and frustration for your employees,
0:00:50 supercharging productivity for your developers,
0:00:54 providing intelligent tools for your service agents to make customers happier.
0:00:57 All built into a single platform you can use right now.
0:00:59 That’s why the world works with ServiceNow.
0:01:03 Visit servicenow.com/aiforpeople to learn more.
0:01:11 Will the VP debate move the needle in what’s shaping up to be a neck-and-neck election?
0:01:14 You never know in advance what will be the thing that matters
0:01:15 and the thing that doesn’t matter.
0:01:19 But Donald Trump will be almost 80,
0:01:25 and J.D. Vance will be one cheeseburger away from the presidency should they win.
0:01:30 I’m Preet Bharara, and this week, the Atlantic magazine’s David Frum
0:01:32 joins me on my podcast, Stay Tuned with Preet,
0:01:35 to break down what happened at the debate.
0:01:36 The episode is out now.
0:01:40 Search and follow Stay Tuned with Preet wherever you get your podcasts.
0:01:46 Episode 319.
0:01:47 Through and under is Erica in covering parts of Iowa.
0:01:51 1919, the U.S. ratified the 18th Amendment,
0:01:55 leading to the prohibition of alcohol, three guys walking to a bar,
0:01:59 an alcoholic, a priest, and a child molester.
0:02:02 And that’s just the first guy.
0:02:04 Go! Go! Go!
0:02:16 Welcome to the 319th episode of The Prop G Pod.
0:02:18 In today’s episode, we speak with Rory Stewart,
0:02:21 the former UK Secretary of State for International Development,
0:02:24 and co-host of the popular podcast, The Rest is Politics.
0:02:28 We discussed with Rory Geopolitics, the state of politics in the U.S. and the UK,
0:02:31 and his recent TED talk where he advocates for a radical way
0:02:35 to address extreme poverty worldwide.
0:02:40 This guy just kind of bleeds, I don’t know, the Union Jack.
0:02:43 He just struck me as so British, but kind of the good parts of Britain.
0:02:46 He’s super smart, super polite,
0:02:49 and I really enjoyed the conversation.
0:02:53 I’m trying to get down, I’m trying to be a little bit more English.
0:02:55 I’m sitting here with tea.
0:02:58 Honey, that’s great tea, tea and biscuits.
0:03:02 Anyways, enjoy our conversation with Consummit Britt,
0:03:04 center of the universe, epicenter of intellect.
0:03:08 Okay, what’s happening? Let’s get to the news.
0:03:14 The dog is home in London after drinking beer and eating sausage in Munich.
0:03:18 And I went to the Activist meeting or conference,
0:03:20 whatever it is, a friend of mine, Steve Cericino, runs the fund,
0:03:23 and I committed to speaking there.
0:03:24 By the way, just a quick trick.
0:03:27 If you ever need someone to commit to something you’re worried about them committing to,
0:03:29 ask them like six months out.
0:03:31 I pretty much commit to anything if it’s six or nine months out,
0:03:33 because it doesn’t seem real to me.
0:03:36 I think there’s a lesson for young people there,
0:03:39 and that is the present value of your emotions is incredibly higher.
0:03:40 It’s discounted at a huge rate,
0:03:44 and that is when you go out about 10 years,
0:03:47 you’re going to look back on the shit that you were really upset about right now,
0:03:50 and you’ll be able to discount it back to the reality of the situation,
0:03:54 and it’s going to seem very small or put another way.
0:03:57 This too shall pass. Don’t be too upset about things.
0:03:58 I don’t know how I got there.
0:04:00 Anyways, what else is going on?
0:04:05 Some big news from my home state of California, Governor Newsom, so handsome, so handsome.
0:04:06 He should be president.
0:04:11 Just anyone that good looking who’s not a village idiot should be president.
0:04:13 I just think it helps to have tall, good-looking people.
0:04:14 I think people take him more seriously.
0:04:19 Anyways, he vetoed SB 1047, an AI safety bill,
0:04:24 aimed to regulate the computing power used to train large artificial intelligence models.
0:04:28 Hollywood and others, including Elon Musk and Jeffrey Hinton,
0:04:31 the godfather of AI, were all for this bill.
0:04:33 So why were they for it? Simple.
0:04:38 So Jeffrey Hinton is very smart, and I think he sees and is justifiably concerned
0:04:42 about the progress of AI and thinks there should be more oversight and regulation.
0:04:48 In addition, California has a habit of leading the nation and the world on thoughtful regulation.
0:04:52 Why do I think it was good for the governor to veto this bill?
0:04:58 Okay, as far as I can tell, this bill essentially was not a bill to regulate AI.
0:05:00 It was a bill to kneecap open AI.
0:05:04 Specifically, it was legislation meant to slow down one company in particular,
0:05:08 and that’s why, quite frankly, Elon Musk was in favor of Mr. Don’t Regulate,
0:05:12 Mr. Tech Libertarian, Get Out of the Way, We’re Smarter Than Government.
0:05:17 Like this, why? Because he’s got his own AI company that is fucking nowhere so far,
0:05:21 and he wants to slow down the leader such that he can catch up.
0:05:23 I just think it’s very disingenuous.
0:05:26 Let’s break down SB 1047, the recently vetoed bill.
0:05:31 This legislation wants to mandate safety testing of AI models that require a certain level of computing power
0:05:33 and cost about $100 million to train.
0:05:36 Okay, the first part of that, there’s nothing wrong with that.
0:05:38 The second part of it, nothing wrong with it.
0:05:42 The bill required companies to add a kill switch to shut down rogue systems
0:05:47 and gave the state the power to sue AI companies if their technology caused harm.
0:05:50 All right, a kill switch makes a lot of sense to me, right?
0:05:52 I’ve never bought that this is sent in.
0:05:55 I think there is always a kill switch, and if there isn’t, they’re lying to you
0:06:00 so they can throw up their arms and say, “No, we want to continue to take ads from Nissan,
0:06:02 and we can’t stop it. Bullshit.”
0:06:05 Notice how all of a sudden Instagram has figured out a way to agegate?
0:06:09 Supposedly it was too complex. They couldn’t figure it out.
0:06:13 And then on the eve of the Kids Online Safety Act, COSA, they figured it out.
0:06:17 It’s pretty easy. They use AI to say, “Okay, clearly, this is a 13-year-old.”
0:06:20 And then when they ask you to verify your age, and it sounds like you’re lying,
0:06:23 they ask you to upload a federal ID, and boom, they have agegated.
0:06:24 What do you know they figured it out?
0:06:28 Isn’t that impressive on the eve of legislation?
0:06:29 There’s a lot of problems with this.
0:06:35 First, the language. If AI companies, if their technology causes harm, okay.
0:06:37 What does that mean, girlfriend? What does that mean?
0:06:41 Like, that’s a pretty wide truck to run shit through.
0:06:43 And I’m definitely a fan of regulating these companies,
0:06:48 but that sounds like just all sorts of class action suits right out of the gates.
0:06:51 In addition, the other thing that was a bit of a tell here
0:06:55 was that they wanted this legislation or this new law to apply to companies
0:06:58 that train over $100 million to train their LLM.
0:07:02 This sounds to me like 98% of the venture capital community
0:07:07 that has funded startups that aren’t open AI
0:07:10 to say, “We want to catch up to open AI and chat to you.”
0:07:12 That is basically running away with it, and they are running away with it.
0:07:15 They have about 70% share of an emerging market.
0:07:18 What’s interesting is just as new technologies that resonate
0:07:20 have faster kind of zero to 60 adoption time,
0:07:23 meaning they get ubiquitous adoption across the general public.
0:07:25 It’s getting shorter and shorter.
0:07:29 It took 10 years for faxes to catch on, 15 years for VCRs to catch on.
0:07:33 It took about two or three years for social media for Instagram to catch on.
0:07:36 And it gets shorter and shorter and shorter.
0:07:40 AI kind of is zero to whatever it was, 10 million users was like,
0:07:42 I don’t know, six or nine months, something crazy.
0:07:46 But just as the emergence or the adoption of these technologies
0:07:47 is happening faster and faster,
0:07:51 so is the emergence of the ultimate duopolys and monopolies that emerge.
0:07:54 Because one company jumps out ahead, has more access to cheap capital,
0:07:57 weaponizes government, soaks up the best human capital,
0:07:59 and kind of runs away with it.
0:08:01 And I think we have a duopoly emerging right now.
0:08:06 And just as Wintel was a source of huge regulatory concern
0:08:10 and probably suppressed a lot of innovation in the ’80s and ’90s,
0:08:12 I think you’re seeing a similar duopoly emerge.
0:08:14 And I’m going to call it open video.
0:08:20 And that is open AI and NVIDIA essentially control 70 and 92%
0:08:25 of the AI market and the AI processor market, respectively.
0:08:26 They’re effectively running away with it.
0:08:29 And if you look at their market capitalizations,
0:08:33 I think they’re just going to have access to a certain level of financial and human capital
0:08:37 that’ll make it hard for them or hard for anyone else to emerge and compete.
0:08:39 There’ll be niche applications, there’ll be all sorts of deals.
0:08:42 The ecosystem itself is going to make a lot of money.
0:08:45 But these guys, in my view, are running away with it.
0:08:49 And so I believe in a progressive tax structure.
0:08:51 And that is, as companies get bigger and make more money,
0:08:52 they should pay more taxes.
0:08:57 By the way, fun fact, corporations are paying their lowest tax rate since 1939
0:09:01 as a percentage of GDP, or is it just basically their tax rates?
0:09:03 Anyways, they’re not paying a lot of taxes right now.
0:09:05 So I think there should be a progressive tax structure.
0:09:09 You should make more money, your marginal tax rate should go up.
0:09:11 But I don’t believe in progressive legislation.
0:09:12 I don’t like selective legislation
0:09:16 that basically harms a certain sector within a sector and not the others.
0:09:17 I think that’s bullshit.
0:09:21 And this to me feels like that we’d like to catch up legislation.
0:09:22 So I’m glad he vetoed it.
0:09:24 He also probably had a lot of political pressure on him.
0:09:27 I did a little bit of back of the envelope math, which I like to do.
0:09:31 Let’s talk about the state budget for California.
0:09:35 The state budget, which is effectively kind of the fifth biggest nation in the world,
0:09:37 is somewhere around a quarter of a trillion dollars.
0:09:39 So what does that mean?
0:09:46 It means that 10%, 10% of California’s budget is or comes from,
0:09:53 I should say 10% of the revenues, comes from the wealth created by two companies in AI,
0:09:54 comes from the AI duopoly.
0:09:58 So you can bet the governor Newsom wakes up in the middle of the night sweating
0:10:01 and his wife turns over and says, “Gov, what’s the problem?”
0:10:03 He said, “I just had this nightmare.”
0:10:05 And she says, “All right, what’s the nightmare?”
0:10:08 And he says, “Well, I had this nightmare that Jensen Huang called me and said,
0:10:13 “I’m going to go be Elon Musk’s roommate in Austin,” or wherever the fuck is in Texas,
0:10:18 because if these companies leave California, you’re talking about a budget hole being blown
0:10:23 the size of a very big hole in the California budget.
0:10:28 The governor noted that 32 of the world’s top 50 AI companies are located in the great
0:10:29 state of California.
0:10:30 Can you believe that?
0:10:35 California has a 64% share of AI companies, and I bet by market capitalization,
0:10:39 it’s 80 or 90%, maybe not that much, because Microsoft’s in Seattle.
0:10:39 I don’t know.
0:10:40 I need to think that through.
0:10:42 I need to think that through.
0:10:46 According to the legislative analyst’s office in 2023, just four major tech companies,
0:10:52 Apple, Google, Metta, and NVIDIA accounted for more than 6% of the state’s total income tax
0:10:53 revenue.
0:10:53 I don’t know what is it.
0:10:54 Cap gains.
0:10:55 I just did that math.
0:11:02 Anyways, this is, in my opinion, incredibly important that we think about getting this
0:11:08 right and trying to balance growth and tax revenue and innovation and jobs with some
0:11:14 sense or some recognition or nod to the fact that not regulating social media and technology
0:11:17 has turned basically an entire generation into addicts.
0:11:18 What do I mean by that?
0:11:22 Just as they’re going through puberty and their brain is getting wired, we are teaching
0:11:24 them to constantly need dopa.
0:11:30 Once they get to a certain age, they’re going to find means of that constant dopa hit through
0:11:32 other means that’ll be pretty unhealthy.
0:11:37 I think you’re going to see addiction, absolutely skyrocket, and it’s going to be reverse engineered
0:11:43 to who are the drug dealers sitting outside of junior high school selling snacks, specifically
0:11:48 Satchinadella, specifically Cinderpichai, and Tim Cook, and Mark Zuckerberg.
0:11:49 Yeah, I said it.
0:11:51 Tim Cook sitting outside of junior high school selling fucking smack.
0:11:53 That is what’s going on here.
0:11:55 These companies need to agegate their devices.
0:12:00 There’s no reason a 16-year-old should have a smartphone or much less be on social
0:12:00 media.
0:12:05 Moving on, California is also in the news for banning legacy and donor admissions at private
0:12:08 universities, including Stanford University, USC, and others.
0:12:11 This ban will take effect in the fall of 2025.
0:12:12 What are legacy admissions?
0:12:15 It’s a practice where certain applicants are given special consideration
0:12:18 because of family or other connections to the school.
0:12:22 Public universities, including the University of California and California State Universities,
0:12:24 have long banned legacy admissions.
0:12:27 So as usual, UC is way out in front of everybody.
0:12:31 By the way, the University of California did away with race-based affirmative action in 1997,
0:12:37 26 years ago, 27 years ago, and went to an adversity score saying, “All right,
0:12:40 if you’re the daughter of an Indian private equity billionaire, you don’t need any help.
0:12:45 But if you’re a white kid from Appalachia from a single parent family and your
0:12:48 mom’s incarcerated, maybe we take that into account.”
0:12:52 And that is absolutely the right way to implement affirmative action.
0:12:54 I’m a beneficiary of affirmative action.
0:12:55 I got Pell Grants.
0:12:56 My mother was a secretary.
0:12:58 She never made more than $40,000 a year.
0:13:03 And that financial aid, that unfair advantage, that discrimination in my favor,
0:13:07 paid off for everybody, which takes me back to legacy admissions.
0:13:09 Legacy admissions actually do have an upside.
0:13:14 And that is they create more affinity, more affection, and greater donors for that school.
0:13:18 And I believe, if you were to say, “Okay, on legacy admissions, we’ll give your kid a leg up.”
0:13:22 But, but we’re going to charge him or her more.
0:13:23 I think you just go straight capitalist here.
0:13:26 The problem, remember Varsity Blues where all those people got stuck in jail,
0:13:31 where Aunt Becky got stuck in jail for paying someone half a million bucks to get her kids
0:13:33 in to pretend that she was a rower?
0:13:34 By the way, I did it entirely wrong.
0:13:36 I went to UCLA and then started rowing.
0:13:37 That made no sense.
0:13:40 Anyways, my attitude is let’s go full capitalist.
0:13:43 These universities, my friends, we’re whores.
0:13:44 Let’s be clear.
0:13:47 But we’re expensive whores that like to think that we’re not whores.
0:13:48 What do I mean by that?
0:13:53 Aunt Becky didn’t go to jail for giving a half a million dollars to get her kid into school.
0:13:56 She went to jail for not giving five million.
0:13:59 In other words, if Aunt Becky had called and said, “Hi, USC.
0:14:01 I’ll give you not even five million.
0:14:02 I’ll give you two million dollars.”
0:14:05 They put Becky’s name.
0:14:08 They’d be like growing pains or whatever the fuck that show was called on the side of a building.
0:14:11 The growing pain center for media and her kid would have got in.
0:14:16 But because she cheaped out and paid someone outside the university half a million dollars,
0:14:20 they called the FBI and the FBI got involved in trying to send a message to a lot of rich
0:14:21 people that this is not cool.
0:14:25 And I get why people think this is wrong.
0:14:26 I get it.
0:14:26 I get it.
0:14:28 But be clear, folks.
0:14:30 We’re still letting in the children of rich people.
0:14:31 They got tutors.
0:14:34 They have access to the industrial tutoring complex.
0:14:35 They have friends on the board.
0:14:36 They get the better recs.
0:14:37 So what do we do?
0:14:39 We take some of that money.
0:14:39 Sure, charge them more.
0:14:41 Your legacy, fine.
0:14:43 We need you to give money and we need you to pay more.
0:14:49 And then we’re going to use that money to offer more seats such that we can let in more kids.
0:14:56 If you had a pill, then when someone took it, made them less likely to be depressed,
0:15:00 less likely to kill themselves, less likely to kill other people, more likely to run for
0:15:04 president, more likely to vote, more likely to get married, more likely to pay a shit ton
0:15:08 of taxes, more likely to be millionaires, less likely to be obese, less likely to be
0:15:11 diabetic, less likely to be incarcerated.
0:15:15 Would you say, I’m not going to give that pill to 91% of the people who want it?
0:15:17 That’s what UCLA does.
0:15:23 Higher ed is the pill, is the treatment, is the ointment, is the pharmaceutical that makes
0:15:24 people’s lives better.
0:15:27 Case in point, the guy on this fucking podcast.
0:15:29 Why are we hoarding it?
0:15:36 So I can feel good about myself and the dean of NYU Stern stands up and says we rejected 85%
0:15:37 of our applicants.
0:15:42 That is tantamount to the head of a homeless shelter bragging that he or she turned away
0:15:44 nine in people that showed up last night.
0:15:48 We are, we are public servants, not fucking Chanel bags.
0:15:52 We’ll be right back for our conversation with Rory Stewart.
0:15:57 Support for Prop 3 comes from Mint Mobile.
0:16:01 There are times when you discover something so incredible, so game-changingly great,
0:16:03 you can’t believe you ever lived without it.
0:16:08 Maybe it’s a specific pair of house slippers or noise-canceling headphones or an actual
0:16:09 full night’s sleep.
0:16:12 Well, Mint Mobile’s phone plans are sort of like that.
0:16:14 Once you hear about them, it’s hard to imagine ever going back.
0:16:15 Here’s why.
0:16:20 When you purchase a three-month plan with Mint Mobile, you pay just $15 a month.
0:16:23 All Mint Mobile plans come with high-speed data and unlimited talk and text delivered
0:16:26 on the nation’s largest 5G network.
0:16:29 You can even keep your phone, your contacts, and your number.
0:16:31 It doesn’t get much easier than that.
0:16:35 To get this new customer offer and your new three-month premium wireless plan for just
0:16:38 15 bucks a month, you can go to mintmobile.com/propg.
0:16:40 That’s mintmobile.com/propg.
0:16:45 You can cut your wireless bill to 15 bucks a month at mintmobile.com/propg.
0:16:49 $45 upfront payment required, equivalent to $15 a month.
0:16:51 New customers on first three-month plan only.
0:16:54 Speed slower above 40 gigabytes on unlimited plan.
0:16:57 Additional taxes, fees, and restrictions apply.
0:16:58 See Mint Mobile for details.
0:17:06 Support for PropG comes from Nerd Wallet.
0:17:10 If you’re a listener of the show, you know business, and if you’re looking for a resource
0:17:13 to find financial products that can help you make smart financial decisions,
0:17:15 turn to the Nerds at Nerd Wallet.
0:17:20 Not only have they spent thousands of hours researching and reviewing over 1300 financial
0:17:23 products, but they have the tools you need to make smarter decisions.
0:17:25 Looking for a credit card?
0:17:28 At Nerd Wallet, you can go beyond the basic comparisons, filter for the features that
0:17:31 matter to you, and read in-depth reviews.
0:17:33 Ready to choose a high-yield savings account?
0:17:36 Get access to exclusive deals and compare rates, bonuses, and more.
0:17:39 House hunting, view today’s top mortgage rates for your home sweet home.
0:17:44 Make the Nerds your go-to resource for smart financial decisions.
0:17:47 Head to nerdwallet.com/learnmore.
0:17:49 Nerd Wallet, finance smarter.
0:17:54 Nerd Wallet Compare, Incorporated, NMLS 161 7539.
0:18:01 Support for PropG comes from Fiverr.
0:18:04 In today’s market, your competitive edge isn’t just your product.
0:18:06 It’s also the people who help you make it.
0:18:10 But finding top tier talent can be expensive, time consuming, and often a gamble.
0:18:15 That’s why Fiverr has developed solutions for business to make outsourcing talent simple,
0:18:16 quick, and effective.
0:18:21 With Fiverr Pro, you get access to curated talent through a catalog rigorously vetted,
0:18:24 professional freelancers organized by skill and experience.
0:18:29 You can also connect with dedicated hiring experts who will help you find the perfect match.
0:18:35 Plus, you get seamless collaboration tools and flexible hiring options by project or hourly.
0:18:38 And for anyone seeking more support, Fiverr Pro’s business partners can manage
0:18:41 multiple freelancer engagements for you.
0:18:44 They’ll outline project management, assemble a roster of freelancers,
0:18:47 and manage a schedule to make sure your deliverables are completed on time.
0:18:50 It lets you flex your budget without any headcount constraints.
0:18:53 Fiverr Pro is designed to handle projects of any size,
0:18:58 and empowers you to build faster, scale smarter, and turn today’s projects into tomorrow’s growth.
0:19:06 Visit pro.fiverr.com to sign up and use code “PROFG” for 15% off any service.
0:19:18 Welcome back.
0:19:22 Here’s our conversation with Rory Stewart, the former U.K. Secretary of State for
0:19:26 International Development and co-host of the popular podcast, The Rest Is Politics.
0:19:28 Rory, what does this podcast find you?
0:19:30 I have just got to London.
0:19:35 So, in your recently released head talk, you advocate for a radical way to address extreme
0:19:38 poverty worldwide, giving cash directly to people in poverty.
0:19:43 Give us that pitch for why we should just be giving people in poverty just straight up cash.
0:19:47 Just before we get into the nub of it, I think the important thing is to understand that there
0:19:51 are basically two models in the world, and it’s caught up in this phrase,
0:19:56 teach someone to fish they can eat for lifetime, give them a fish they eat for a day.
0:20:01 And a lot of the fashion in international development, for very understandable reasons,
0:20:06 has been not about giving people things, but instead about giving them training,
0:20:07 knowledge, capacity building.
0:20:16 And cash is very radical because it’s an action of radical humility or essentially saying,
0:20:19 these people have a better idea about their lives and priorities than I do,
0:20:24 and I’m going to get out of the way and give them what they really want, which is cash.
0:20:28 Now, why does it work? And this, we can get into the evidence on it.
0:20:32 The evidence is very striking, hundreds of randomized control trials demonstrating the
0:20:38 impact. My guess for why it works is that firstly, it’s much more flexible.
0:20:44 I think the second thing that it does quite powerfully is it’s generally much more efficient.
0:20:49 I mean, if I give you the cash to fix your own roof in a very poor community,
0:20:53 you can probably get it done for about $150. If I bring in a non-profit,
0:20:58 we’d have to bring in engineers, we’d survey your house, we’d procure your roof,
0:21:01 we’d do all these studies, and we’d end up spending many thousands of dollars,
0:21:04 almost certainly for similar impact.
0:21:11 And then I guess somewhere at the bottom of it is the sense that in many cases,
0:21:16 people already have the knowledge. They already know what business they want to run.
0:21:18 They just lack the capital to get that business off the ground.
0:21:23 So those three things together, I think, are the ingredients that makes cash so effective.
0:21:29 Your comments, I mean, I think true insight is when you state the obvious, but you weren’t,
0:21:32 it wasn’t obvious to you before you heard it. And your comments really resonate because I
0:21:40 equated a little bit to, there’s a DEI apparatus that’s propped up or popped up across every
0:21:46 university in America. And I would argue that it was, these apparatus were apparatus, whatever
0:21:51 its term is, were desperately needed. 60 years ago, 12 black people at Harvard, Princeton, and Yale.
0:21:54 That was an issue. We needed departments to focus on the issue.
0:21:59 Now they have huge apparatus of very well-paid people, a lot of resources.
0:22:04 Harvard’s freshman class is 51% non-white. But these apparatus never go away.
0:22:10 And the way I relate it back to this is all of these non-profits represent a lot of jobs and
0:22:14 a lot of people who make good livings and feel important and feel like they’re doing good work
0:22:19 and have a vested interest in, quite frankly, obstructing a simpler
0:22:25 solution is devising it or positioning it as crass or is not that effective. And
0:22:30 do you see what I’ll call the non-profit infrastructure sort of getting in the way
0:22:34 and being intellectually dishonest about how effective this would be?
0:22:43 Yes. And I was part of that. I mean, I was the UK Secretary of State, so I was the minister
0:22:48 in charge of this $20 billion a year budget and thousands of civil servants doing international
0:22:55 development. And I remember when people first brought this idea of cash to me that I said half
0:23:00 joking, listen, what’s going to happen to all of us, right? There are thousands of us employed,
0:23:04 managing, we’ve all done master’s degrees in agricultural economics. We’re going to be experts
0:23:09 on health programs and remote parts of Liberia. If we’re just giving people cash, what about all
0:23:15 us, right? I realize that it’s a sort of strange thing when you’re inside a bureaucracy. I’m only
0:23:21 half joking. And the fact that that’s my immediate reaction suggests something quite strange about
0:23:27 the way that the mind of the bureaucrat works. So the majority of our listeners are in the U.S.
0:23:32 and for those of you who don’t know, Rory is the co-host of what is probably, I would argue,
0:23:36 the best politics podcast in the world right now called The Rest is Politics. I’m going to ask you
0:23:40 to do something that is nearly impossible, but if you were to give Americans who have
0:23:47 little or no sense of U.K. politics over the last 10 years, can you give us the cliff notes
0:23:52 on what has happened in the U.K. and what you think it represents and what have been the major
0:23:58 sort of shifts around leadership and what the populace has decided and where you think the U.K.
0:24:08 is headed politically, if you will. So I think the first really big date is 2005, when 2005 the
0:24:14 British economy is still bigger than the Chinese economy, not very long ago. That’s crazy. That’s
0:24:20 a great start. It’s amazing. 19 years ago, the U.K. had a bigger economy in China. Yeah. And now the
0:24:26 Chinese economy is about seven times as. So that’s the first big fact. Our relative power in the
0:24:31 world has changed very dramatically. And it’s concealed from us because we’ve gone from being
0:24:35 the fourth largest economy in the world to being the fifth largest economy in the world. But in
0:24:42 relative terms, the shift has been off the scale. Second date, I think is 2010, when a conservative
0:24:47 government was elected, which has been in for the last 14 years and was only finally kicked out by a
0:24:53 more left-wing labor government that came in just in an election just under 100 days ago. And they
0:25:00 came in off the financial crisis, and their watchword was austerity. So they tried to reduce the
0:25:07 debt and deficit. They cut government spending very dramatically. And there’s, as you can imagine,
0:25:12 a huge argument between conservatives and people on the other side about whether that was the right
0:25:19 thing to do for the economy or not. Next date, 2016, Britain votes to leave the European Union.
0:25:26 And that removes us from being part of a single marketer customs union with our
0:25:34 largest trading partner. Next date, I guess, that matters is 2020, when we get into one of the most
0:25:40 aggressive COVID lockdowns in the world, far more so than the US. I mean, people were kind
0:25:44 of shopping their neighbors for gathering in groups and more than three at a barbecue outdoors.
0:25:51 And we’re still calculating the cost of that, but it probably costs the British government
0:25:57 about £400 million, which is a significant, sorry, £400 billion. I’m sorry, I got a thousand,
0:26:04 a thousand off that £400 billion. So a really significant chunk of government expenditure
0:26:09 annually is about a trillion. So about 40% of annual government expenditure was spent on the COVID
0:26:18 response. And then the final thing has been demography. So when we set up our welfare state
0:26:22 before the First World War, there were 20 working people for every one retired person. Today, there
0:26:28 are just under three working people for every one retired person. We’re living longer and longer.
0:26:33 We have a cradle to grave healthcare system that’s getting more and more expensive. In fact,
0:26:39 about 3% more expensive every year than inflation because of aging and the cost of drugs.
0:26:45 And our economic growth has been anemic. Our productivity has been flat since the financial
0:26:52 crisis. And you can imagine as a result of all of that, you have a pretty cross population
0:26:56 and a new government that’s come in feeling it doesn’t have many options because unlike the US,
0:26:59 it’s not the world’s reserve currency. It can’t go and borrow a huge amount.
0:27:05 Describe what you think will be the biggest changes of this new administration relative to the
0:27:10 conservatives over the last 14 years. Well, it’s very difficult to see that at the moment.
0:27:17 I mean, it’s very cosmetic. They’re closer to the unions and they’ve given significant public
0:27:21 sector pay rises as soon as they came in, which of course has made the conservatives
0:27:26 sort of delighted because it plays into their kind of cliches about left-wing governments.
0:27:32 They have however stuck with most of the spending reductions. They’ve promised not to increase
0:27:37 taxes. They’ve promised not to increase borrowing. How do they do that? If they’re going to increase
0:27:42 wages, how do they not increase the deficit of taxes? They’ve cut investment and that again
0:27:46 is pretty troubling. I mean, they’ve stopped most of the rail and road investment. They’ve just
0:27:50 canceled a big supercomputer that was being built in Edinburgh. They’ve announced they’re not going
0:27:56 ahead with big programs to rebuild hospitals. So I think they’re in trouble. I mean, this is a
0:28:02 left-wing government that’s come in after 14 years in which the British public are fed up with
0:28:07 austerity and want more investment in public services. It’s a government that is trying to
0:28:11 reassure the financial markets and felt that the only way of winning the election was to promise
0:28:16 it would never put taxes up, but now finds itself having won a big majority with its hands tied
0:28:23 behind its back by this promise. So what I’d like to do is I want to give you some observations
0:28:29 of a bystander and that as an American who’s lived in London for two years and as a means of
0:28:34 contrasting or using it as a jumping out point for contrasting the US and the little I understand
0:28:39 about the UK, but I’ll give you some observations and I want you to respond to them. The first is
0:28:43 to the upside. As an American here, as someone who’s concerned themselves are progressive,
0:28:49 I find all the dumb arguments in the UK have been put in the past. Assault weapons, well,
0:28:53 of course we don’t have assault weapons, bodily autonomy for women. Well, it’s not even a
0:28:59 conversation or of course women in bodily autonomy. Trans rights, okay, fine. It’s not a big issue
0:29:02 for us. We’re not going to spend a ton of political capital worrying about a second or a third
0:29:09 bathroom. So I really appreciate that about the UK. My observation is that, and this is a question,
0:29:14 I’m genuinely flummoxed by the amount of intellectual property here, the amount of
0:29:20 intellectual capital, the unbelievable quality of the education system. The thing I love most
0:29:24 about the UK is my kids’ schools. I just think they’re fantastic. And I think the universities
0:29:29 here are incredible. I’ve had the good privilege or the good fortune to speak at a bunch of them,
0:29:37 just such incredibly bright people. An amazing culture, a rule of fair play, smart, funny,
0:29:44 and appreciation for the arts, a global culture that appreciates other cultures. And yet they
0:29:51 can’t get out of their own goddamn way. And when I look at London, I think there’s no organic value
0:29:58 creation. The only people I know making money here are serving money made elsewhere. Do you agree
0:30:05 with this? That Britain, the UK still has all the pillars to be just a robust high growth
0:30:13 leadership economy and manages to steal victory from the jaws of defeat. I don’t know why
0:30:19 your thoughts. It’s obviously the central question of British politics. And there’s a lot
0:30:29 of different ideology goes into trying to answer that question. Some of it is cultural. So we have
0:30:35 a big problem with developing technology and ideas and then struggling to finance it. And that seems
0:30:42 to be partly about the risk capital in the UK. I think another thing is that we have really
0:30:49 struggled to unlock the potential of anything outside London and the Southeast. We’ve created a
0:30:53 very unequal economy and some of that is about infrastructure investment. If we had decent
0:30:59 rail and road infrastructure connecting Leeds and Manchester, we would create pretty impressive
0:31:04 urban conurbation and we might be able to generate some serious productivity. Productivity in London
0:31:09 and the Southeast is so far ahead of the rest of the country. And then we get into ideology. I think
0:31:18 we’re too centralized. We should decentralize more. I think we’ve got really in our way when it
0:31:23 comes to planning and building things. I mean, one kilometer a road, one mile a road costs twice
0:31:29 as much to build as what it does in France. We’re struggling to build housing and a lot of that is
0:31:36 because we have this very, very consensual planning system where people discuss everything for years
0:31:43 and every newt and argument good and bad for why houses shouldn’t be built ahead and very little
0:31:50 gets off the ground. So now do the US. You’re a very thoughtful guy. Give us your no mercy,
0:31:57 no malice view of the situation in America. I’m married to an American. I have been teaching at
0:32:05 Yale. So what does the European notice looking at the US? I think one thing is you have a really
0:32:10 magical economy. I mean, there’s something astonishing about what’s happened in the
0:32:15 last 14 years in terms of the divergence from the eurozone. We were almost level pegging in GDP
0:32:24 per capita 14, 15 years ago and US growth rates have shot off. And you’re doing it in a way that
0:32:30 doesn’t really make sense to us. If I was being rude about the US, your state education system
0:32:35 is terrible. I mean, I’ve just been in Chicago. The statistics from Cook County are beyond
0:32:40 belief. The majority of people graduating high school who should not be in any position to
0:32:45 graduate high school in terms of their literacy and numeracy rates. And theoretically, when we
0:32:50 model these things, smart people like you tell us that the way to create productivity is to have a
0:32:56 great education system and all these people coming through. But my goodness, apart from the top,
0:33:01 apart from the kind of the cream of America, these incredible Ivy League universities,
0:33:08 the mass of people are not receiving good education. And you know, God, we’re also completely puzzled
0:33:14 by healthcare and welfare. We’re very puzzled by the fact that it just seems so rich, but also so
0:33:19 poor. I mean, go up and down the Connecticut shoreline, there are just boats everywhere.
0:33:24 I mean, you have tens of millions of people who are astonishingly wealthy, and then
0:33:29 you have people living in Flint, Michigan or in Georgia in conditions that we couldn’t imagine
0:33:33 in Europe. So those are the kinds of things that puzzle us. And I think one of the things
0:33:40 that puzzles us most probably is that an election in Europe, in the UK or Europe, would be talking
0:33:47 about the state education system. It would be talking about public health and health delivery.
0:33:54 That doesn’t seem to be what’s dominating the election between Donald Trump and Kamala Harris
0:33:59 at all. Do you have kids, Rory? Yeah, I’ve got two boys. Two boys, how old? Nine and seven.
0:34:05 You’re in the golden decade, four to 14 are wonderful. Zero to four, we pretend to like it,
0:34:10 we don’t. Once they turn 14, they stop, you know, they no longer look up to you, you become just
0:34:16 this awful person that just warrants eye rolls about 12 times a day. You’re in the golden decade.
0:34:29 My question is where, if they said dad aged 18 to 38, kind of the years starting my career,
0:34:32 getting going, would you want them to live in the US or the UK and why?
0:34:38 At the moment, I’d probably be tempted by them living in the US, I’m afraid. And it’s a terrible
0:34:43 thing to say because I’ve dedicated my whole life to Britain. I was a British politician. I
0:34:50 love this country. I have huge emotional investment in it. But it feels to me as though we are really
0:34:59 lost at the moment. And that’s an awful thing to say. But I’m afraid I understand why so many
0:35:03 people around the world want their children to move to the US. I mean, it just feels as though
0:35:08 there’s more space to come back to the old cliche that there’s more opportunity.
0:35:16 But I hope I’m proved wrong. I hope we can find our way through this malaise and that over the
0:35:22 next decade, we can get the UK back into a situation where I can say this is where our ancestors
0:35:27 are buried. This is where my house is. This is where our roots are and let’s make a go of it.
0:35:32 You described democracy as increasingly fragile. What do you believe are the key
0:35:38 threats to democracy today? I think the first fundamental threat is that liberal democracies
0:35:45 haven’t been delivering well enough for people. I mean, that for about 200 years from the early
0:35:51 1800s, we could tell a story where we convinced ourselves that democracies were naturally more
0:35:57 prosperous. And as people became more prosperous, they became more democratic. And partly because of
0:36:03 the rise of China, but partly because the success of other authoritarian regimes, we’ve broken the
0:36:09 link in which democracies are not necessarily delivering for people. And in certain years,
0:36:13 it feels as though non-democratic states are delivering quite effectively. So that’s one problem.
0:36:19 I think the second, and that is a big problem because I think the reason why people buy into
0:36:24 democracy is not only because they believe in human rights and liberal values, it’s also because
0:36:32 it was making them wealthier. I think the second threat is I’m afraid social media. I think it’s
0:36:38 not a coincidence that the rise of social media from 2003, 2004 onwards and its explosion with
0:36:44 the Arab Spring in 2010, 2011 is part of the story of the rise of populism and the rise of
0:36:51 authoritarianism because I think those are algorithms that drive people into polarized states. And I
0:36:58 think they have been extremely bad for the key bits of democratic discourse in particular,
0:37:03 compromise, meeting in the middle, explaining, having a shared frame of reference.
0:37:09 What in your view is the impact on the UK and Europe of a Trump or a Harris presidency?
0:37:16 Harris presidency, I think, doesn’t trouble people too much. It feels like a continuity
0:37:21 of what went before Biden. And we feel we sort of got a measure of where Joe Biden was coming from.
0:37:28 Trump presidency, I think, is going to be more troubling for people because it will encourage
0:37:36 populists like Viktor Orban in Hungary or Marine Le Pen, who’s this far-right politician running to
0:37:41 be the president of France to feel that they’re entering a new age of strong men or strong women.
0:37:48 We would be worried that he would pretty quickly compromise with Putin in a way that would
0:37:54 effectively give Putin power over Kiev. We would be concerned that
0:38:00 understandable American tendencies towards isolationism and protectionism would accelerate.
0:38:08 And we’d find ourselves facing significant trade barriers and that the world, as a result,
0:38:13 would get less stable and less prosperous. We’ll be right back.
0:38:20 Support for Prop G comes from Anthropic. If you’re not using AI to help your business
0:38:24 run more efficiently, you might be falling behind still. It’s a lot easier to talk about
0:38:29 incorporating AI into your workflow than it is to actually get started. The landscape is cluttered
0:38:33 and technical, and a lot of us are fatigued by the options. If you’re looking for a place to get
0:38:39 started, Claude from Anthropic may be the answer. Claude is a next-generation AI assistant built to
0:38:44 help you work more efficiently without sacrificing safety or reliability. Anthropic’s latest model,
0:38:50 Claude 3.5 Sonnet, can help you organize thoughts, solve tricky problems, analyze data, and more,
0:38:53 whether you’re brainstorming alone or working on a team with thousands of people,
0:38:58 all at a price that works for just about any use case. If you’re trying to crack a problem
0:39:02 involving advanced reasoning, you need to distill the essence of complex images or graphs,
0:39:07 or generate heaps of secure code, Claude is a great way to save time and money. Plus,
0:39:11 the Anthropic leadership team was founded in AI research and built Claude with an emphasis on
0:39:18 safety. To learn more, visit anthropic.com/claude. That’s anthropic.com/claude.
0:39:29 So you brought up some geopolitics. I apologize for skipping around so much here,
0:39:32 but while you’re here, I want to take advantage of this. I’d love to just get your quick thoughts
0:39:42 on the war in Britain’s role or non-role in the Ukraine-Russia war. Ukraine-Russia
0:39:52 has flipped on its head in three very dramatic ways. Initially, nobody expected Russia to go
0:39:57 into Ukraine, and they thought Russia was going to definitely take Kiev. Then they got optimistic
0:40:02 about a counteroffensive, and now we’re in a situation where the Russian economy is growing
0:40:06 fast. They seem to be able to mobilize a lot of people, and they seem to have a lot of missiles.
0:40:16 Ukraine’s survival is dependent on the UK, Europe, but above all the US, putting in tens of
0:40:22 billions of dollars a year, and being prepared to do that again next year. It’s also dependent
0:40:28 on our willingness to take risk in terms of allowing Ukraine to use weapons against Russian
0:40:34 territory and making the very difficult calculation of how Putin’s going to respond to that,
0:40:38 right the way through to whether he’s going to launch tactical nuclear weapons as part of a
0:40:51 response that. So I think we were right to fight. I think had we allowed Putin to simply walk into
0:40:56 Ukraine, a world that was already getting more and more dangerous would get significantly more
0:41:02 dangerous. In fact, I think the failure to respond in 2014 in Crimea, the failure to hold out red
0:41:08 lines in Syria as part of the reason we’re in this trouble. But equally, it’s obvious to all of us
0:41:15 that there needs to be a peace deal, that it’s not credible that Ukraine is going to be able to
0:41:20 achieve all the objectives that its supporters have, and I’m a huge supporter of Ukraine,
0:41:25 but that there needs to be some kind of negotiation. The only hope is that they can
0:41:29 do that negotiation from positional strength and momentum rather than from positional weakness.
0:41:31 The war on the Middle East?
0:41:39 War on the Middle East. Well, I think that too much of what Israel is doing is driven by Netanyahu’s
0:41:47 attempt to hold his coalition together and in particular hold Smotrych and Ben Kavir on the
0:41:54 far right of his coalition on side rather than actual calculation about what is likely to lead
0:41:59 to a more peaceful, stable situation for Israel. What would that be? Let me just press pause there.
0:42:05 What if you felt there was a more thoughtful administration? What do you think, what does
0:42:12 that look like? Well, it has to move very, very quickly towards reconstructing Gaza,
0:42:19 and it has to move very quickly towards some sort of path for political autonomy for Palestine.
0:42:26 It has to balance that with Israel’s security. Now, that’s not easy to do, but we had recipes
0:42:32 for what that might look like in the mid-1990s. We still had those recipes in the mid-2000s and
0:42:42 killing 40,000 people in Gaza and levelling that place. I mean, it’s destroyed and now
0:42:48 launching these attacks into Lebanon don’t seem to me to be part of a long-term plan.
0:42:52 I don’t see where that goes in five or 10 years’ time. I don’t see how that
0:43:01 gets anybody to a situation of stability. I’m afraid with the critics of Netanyahu on this,
0:43:07 I don’t think his objectives, his strategic objectives are achievable. I don’t think he can
0:43:13 eliminate Hamas. I definitely don’t think he can eliminate Hezbollah. If he can’t,
0:43:19 he needs to find a path towards coexistence, however difficult that is.
0:43:28 So just to play a kind of steel man this, so with respect to launching this offensive,
0:43:33 I forget the words used against Lebanon, what would you say to people who say, “Well,
0:43:37 Lebanon has fired 8,500 missiles into Israel over the last 10 years. This war has been going on a
0:43:43 while and that the only way to have some sort of stable peace is to quite frankly terrorize the
0:43:47 terrorists and have a preemptive strike.” Because it’s not as if, I mean, I’m thinking about the
0:43:52 pager detonations, it’s not as if these folks were trying, hoping to give peace a chance and seem
0:43:58 to be really open and biased towards a peace deal. I feel like it’s a very American thing that,
0:44:04 okay, we need peace, we need a ceasefire, versus recognizing throughout history the only way you
0:44:10 kind of get, in my opinion, a stable peace through a war is to win it. And that a lot of what Israel
0:44:16 is doing right now is, in my view, I think Netanyahu’s been diabolical in a disaster for Israel.
0:44:27 But at the same time, I think the response in Gaza has been fully warranted and that the collateral
0:44:36 damage there is horrific, but is on a civilian to combatant ratio more humane or less inhumane
0:44:43 than any recent war that the West has prosecuted. And it strikes me that when the media says that
0:44:49 Israel has escalated the war in Lebanon, I see them as trying to de-escalate future conflict by
0:44:56 going after an incredibly precise anti-terrorist operation, in my view, trying to preempt a
0:44:59 future war that threatens their very existence. Your thoughts?
0:45:07 Well, that’s definitely the view of the people who back it. I just don’t think it works. I don’t
0:45:15 understand how they think this is going to deal with 20,000 armed and highly experienced
0:45:23 Hezbollah veterans who have formed up over 40 years, who fought in Syria, who have 10 times the
0:45:29 number of weapons they had in 2004, including precision-guided munitions, short of a ground
0:45:36 assault into Lebanon, they’re never going to be able to tackle that. And I think a ground assault
0:45:42 into Lebanon is beyond them. I think it’s beyond Israeli capacity, because Hezbollah is a much
0:45:49 more formidable enemy than Hamas and their positions in Lebanon are incomparably more
0:45:57 difficult to attack. So they can blow up pages and they can destroy some missiles. But
0:46:09 the idea that that is going to win a victory, in a way, the logic of your argument would require
0:46:16 them to win a victory so decisive that there’s no coming back. But they can’t do that. They don’t have
0:46:21 those resources. They don’t have the manpower to do that. They don’t have an option of wiping
0:46:24 Hezbollah off the face of the map.
0:46:29 But let’s talk about what are the options to just sit and take it and hope that the
0:46:35 Americans of the West come in with some sort of diplomacy. I agree this is a much more
0:46:40 formidable fighting force. I guess what are the options here?
0:46:47 The options from the very beginning of the State of Israel have been very difficult. This
0:46:55 is a situation in which Israel was created out of conflict and war and has existed through
0:47:04 conflicts and war ever since. That has been the situation since the 1930s. And I guess,
0:47:09 do I think that there is a military end to that? No.
0:47:18 No. I think the situation was best in the mid 1990s when they were getting towards an
0:47:23 accommodation and when they were trying to be serious about what a two-state solution would be.
0:47:29 But I think this path of backing the settlers, backing people and the…
0:47:38 I mean, remember, Smotrych and Ben Gavir don’t want the existing boundaries of Israel.
0:47:41 They don’t even want the existing boundaries of Israel plus the settlements.
0:47:49 They have a vision of a historic Israel from the Bible which involves displacing and occupying
0:47:56 much, much more territory. So there’s no path there.
0:48:02 I feel like it’s unfair to say that without acknowledging that they’re surrounded by people
0:48:05 whose only constitutional amendment is the extermination of Jews.
0:48:11 So it’s one thing to have… I think there’s some outright, far-right bigots on the Knesset.
0:48:16 I think it’s been a disaster for Israel. Oversettlements. 100% I’m with you.
0:48:21 But meanwhile, the only thing I can see resembling a constitution or a mission or a purpose statement
0:48:27 about the Houthis and Hamas is the elimination of Israel and the extermination of Jews.
0:48:35 So that to me, one is awful practices on the part of a government or society.
0:48:41 Another is a genocidal death cult. And it strikes me that this piece we’re talking about that we’d
0:48:47 like, it takes two to tango. My sense is that Israel and the West have come to the table with
0:48:51 some semblance of an offer that Hamas has said they’re not interested in.
0:49:00 Well, there’s many things to unpack there. One is Netanyahu who’s not been serious about any offer.
0:49:06 He has no interest in these peace deals. The more fundamental thing, this is a horrible
0:49:09 thing to talk about, and it’s very difficult to talk about sensitively.
0:49:19 But I guess the question is, what is it exactly that Israel is worried about that they’re trying
0:49:25 to deal with here? There was an extreme barbaric horrifying atrocity in October.
0:49:33 But what actually happened there? What actually happened there was a pretty low tech assault
0:49:39 across a very poorly defended border with the Israeli army and security intelligence services,
0:49:45 I’m afraid, not competently defending that border. If you’re trying to fix that problem,
0:49:50 there is a hell of a lot that you could have done to prevent that assault happening.
0:49:58 And for the last 30 years, there’s been no evidence that Hamas and Hisbollah
0:50:04 posed an existential threat to the survival of Israel, nor what happened horrifying though it was,
0:50:11 was not an existential threat to the survival of Israel. What happened was a brutal horrifying
0:50:16 terrorist assault with all that went with it. And that’s something that could have been dealt with
0:50:21 I’m afraid, by reasonable military security intelligence procedures at a border.
0:50:28 This is also where I disagree with the US’s approach to 9/11. I don’t think 9/11 was an
0:50:34 existential threat to the United States. And I think the way to deal with it is to improve your
0:50:41 intelligence security procedures, not to think that you can somehow solve the problem once and
0:50:46 for all by invading someone else’s country. So you are being intellectually honest. I would
0:50:50 argue that you’re sort of blaming the victim and the second worst day in Jewish history since
0:50:57 the Holocaust does warrant a response. And to your point, when 2800 Americans were killed,
0:51:03 we went on to kill 400,000 Iraqis and Afghanis. And I would argue that in some ways that conflict
0:51:08 set the stage for what’s going on now. And that is an unchecked Iran, because we’ve taken out the
0:51:14 buffer of Iraq. So I agree with you to have the viewpoint you have on Israel would need to require
0:51:20 a similar response on what you feel is probably an over-response from the US.
0:51:24 A crazy response after 9/11. It made no response. I mean, the problem is,
0:51:31 this is too emotionally charged for people on every side. I mean, people have lost relatives,
0:51:35 they’ve seen images of rape and murder and there are hostages being kept.
0:51:42 So nobody’s going to want to think about this in objective terms. Nobody wants to think about
0:51:47 the long term. Nobody, people want revenge. And they want to believe the fantasy that there is
0:51:51 something that you can do that can guarantee this can never happen again. But the world
0:51:57 isn’t like that. And that region isn’t like that. And the same will be true on the Palestinian side.
0:52:04 What they see is 40,000 people killed and women and children dead. And they’re not interested
0:52:08 in having any conversation around this either, because everybody is too traumatized.
0:52:16 I want to move to something lighter. I don’t want to end on that. So I don’t know how to segue
0:52:21 out of this. I’m going to ask you two very, very trivial questions. The first is we’re going back
0:52:25 to our sons. We have a lot of young men who listen to this podcast, a lot of new dads.
0:52:32 What are your observations around parenting being a good partner and being a good father?
0:52:39 I think it’s very easy to say that you acknowledge that your children
0:52:45 are different to you. But in practice, it’s very difficult to lift that out. I mean, the great
0:52:51 wisdom is that these are very different human beings with very different characters and minds,
0:52:59 and they’re going to find their own paths. But there is so much in our parenting, which is about
0:53:04 trying to model the parenting that we received or repeat the parenting we received or
0:53:11 to try to make kids do things which we enjoyed or read books which we like reading or become the
0:53:16 kind of people that we either were or even worse trying to become the kind of people we wished
0:53:24 we were. So getting out of their way and getting the balance between really testing them, challenging
0:53:32 them, pushing them, but also accepting when they’re not going to be very good at something,
0:53:35 acknowledge when they’re not going to enjoy something. I mean, I’m struggling with this
0:53:39 in my seven-year-old at the moment. I’m obsessed with reading books. I read books all the time.
0:53:43 He tells me he doesn’t really like reading books. So we’re in a continual
0:53:49 standoff where I, of course, say to myself, “Oh, he just says that, and I just need to find the
0:53:54 right book for him.” So the poor boy is now buried under 200 different books that I’ve
0:53:59 tried to produce in the hope that I can. And I come up with every kind of bribe and trick
0:54:03 and story to try to get him to do these things. Maybe at some point, I have to acknowledge that
0:54:06 he actually, when he says he wants to play football instead of reading a book, he genuinely does
0:54:10 want to play football instead of reading a book. Let me just say it gets worse.
0:54:19 I have the same issue around, I would really like to inspire my kids to get their face out of
0:54:23 other phones and to read more. And for me, it was in junior high school, this great book series
0:54:27 called “The Great Brain” about a young kid who is smart and funny. Do you know this?
0:54:29 Oh, I’m going to write that down.
0:54:34 That was wonderful. It was just really fun. It was about a kid in, I think, 19th century
0:54:39 middle America, and just his adventures and how he was always kind of, I know,
0:54:45 was kind of very mark twain like. And then as I got into high school, I started reading John Irving,
0:54:50 and I just thought that was so wonderful. Anyways, your turn. What, if I were to try
0:54:55 and put a book in front of my 17 or 14 year old that might inspire them or reignite them,
0:54:57 their interest in reading, what are two or three titles you would recommend?
0:55:06 Well, I think getting people into really good short detective and spy fiction is a great way
0:55:13 of developing people’s literary tastes and skills while having fun. So I think Michael Connolly,
0:55:17 who writes these amazing Los Angeles police detective procedural novels, is great.
0:55:24 The Harry Bosch series, I think, John Le Carré’s spy stories, I mean, it’s a little bit more adult,
0:55:31 but he is an extraordinary pro stylist. There’s a great French detective writer, George Cimanon,
0:55:36 but it’s very short books and may great novels. But I also think nonfiction is fantastic.
0:55:42 There’s some great stuff for us recently about, well, I think that you’ve all know Harari’s
0:55:50 Sapiens is a great thing for a young adult to get into. There’s an American academic at Edinburgh
0:55:53 called Steve Bruce. He’s written a great book called The Rise and Fall of the Dinosaurs,
0:56:00 which I’d recommend. It’s a lovely book because he’s explaining some pretty complex stuff about
0:56:08 paleontology through stories of his friends in Poland and his adventures. So I’d be trying to
0:56:14 ship that at them. I think historical novels can also be a great way through.
0:56:19 I don’t know how young your youngest son is, maybe a little old now, but there’s a series
0:56:24 called the Young Samurai series set in Tokugawa, Japan for about 1600.
0:56:26 Do you see Shogun?
0:56:29 Yeah, exactly. It’s very much Shogun for children.
0:56:29 Wonderful.
0:56:31 I read Shogun when I was 15 and loved it.
0:56:37 Yeah, James Clavel. I remember that. I like all of those. Rory Stewart is the former UK
0:56:41 Secretary of State for International Development and co-host of the popular podcast The Rest is
0:56:47 Politics. He serves as a senior advisor to give directly a notable direct cash charity and his
0:56:52 professor in the practice of grand strategy at the Yale Jackson School of Global Affairs.
0:56:55 Rory is also the author of several books, including The Places in Between, How Not to
0:57:01 Be a Politician and Politics on the Edge. I could go on forever, but the thing I found so interesting
0:57:07 here is that he walked on foot for two years across Afghanistan, Iran, Pakistan, India,
0:57:15 and Nepal in 2002. Rory, I could not disagree with you more on Israel, but I find you are so
0:57:22 sober and thoughtful and reserved and intellectually honest about your comments,
0:57:27 that it softens the beach for me, and while I haven’t changed my view, I do learn.
0:57:32 And I hope that more people are exposed to you and your views, because even if they don’t change
0:57:37 their mind, it just helps us all move forward and think, all right, there’s got to be a way
0:57:41 we can find common ground here. Thank you for your good work. I really enjoyed this conversation.
0:57:43 Thank you, Scott. Really appreciate it.
0:58:01 Out of happiness, I was really moved by a TikTok I saw of a young woman who was talking,
0:58:07 she had left her house for the first time without a wig. She suffers from alopecia,
0:58:12 has some baldness, hair loss, whatever you want to call it. And she said it was the first time
0:58:17 she’d left her house without a wig, and it was a very trying and emotional moment for her,
0:58:22 and that she wasn’t going to let alopecia rule her life. And I really related to it in the sense
0:58:30 that I think as young people, we’re just so focused, we’re so insecure, we’re insecure beings,
0:58:35 and we’re insecure for a reason. You’re meant to be worried about shit, because that’s a survival
0:58:40 instinct. You’re meant to worry about what others think about you, because being shaming and kicked
0:58:46 out of the tribe meant certain death. So shame and also your attractiveness to mates wanting to be
0:58:53 attractive such that the species propagate. I think that men are especially susceptible to
0:59:00 shaming around their economic viability, and women are unfairly judged based on their aesthetics.
0:59:03 So I think there can be especially insecure around their looks, especially young people.
0:59:10 And it kind of took me back to when I lost my hair. Believe it or not, my hair used to be one
0:59:14 of my best features. I had a ponytail in graduate school, which is an image, isn’t it? And then
0:59:19 when I started losing my hair, it was just sort of devastating is the wrong word, but it was really
0:59:23 upsetting. And the worst thing about losing your hair is the losing part. It’s great to have a full
0:59:29 head of hair. It’s great, in my opinion, to be bald. I love having a shaved head. But the in-between
0:59:33 is what sucked. And it used to be a huge source of insecurity and upset for me that I was losing
0:59:37 what I thought was my best feature. And obviously it represents the loss of masculinity and youth and
0:59:43 all those good things. But what I would say to anyone who’s struggling with one thing about their
0:59:49 physical appearance, keep in mind that people just look at you and they make an assessment
0:59:55 on the whole you. And I was looking at this woman, she had really cool nails and beautiful skin and
1:00:01 a nice smile. And I remember thinking that people who look at her or men that look at her think,
1:00:05 oh, there’s a nice looking woman. And they might think, if they look closely, oh, she has hair loss,
1:00:10 but they don’t, it’s not that what they zero in on. They zero in on how the whole person,
1:00:15 your personality, your intellect, your character, your smile, your clothes, the way you dress.
1:00:20 So my advice to young people is to lean into your strengths. I started working out such that
1:00:28 I could take advantage of some of my strengths. And I tried to take some pride in the way I dress,
1:00:33 despite the fact that losing your hair in your 20s is not a very good look. I also had terrible
1:00:38 acne when I was younger. And I started getting scarring on my face, which I was really self-conscious
1:00:43 about. And then I remember telling my ex-wife that I was so self-conscious about my acne scars.
1:00:48 And she looked at me and she said, where do you have acne scars? And I thought, wow, people really
1:00:54 don’t notice what you think they’re noticing. And so what you’re going to be upset about when you get
1:01:02 older is not that you had acne, not that you had hair loss, not that you’re a little bit overweight,
1:01:07 whatever it might be, you’re going to be upset at how upset you were. Don’t focus on the little
1:01:11 things. Don’t focus on what’s wrong with you. The thing you’re going to be upset about is looking
1:01:15 back. You’re going to wish you’d been kinder to yourself. You’re going to realize that you were
1:01:22 better looking than you thought. This episode was produced by Caroline Shagren. Jennifer Sanchez
1:01:27 is our associate producer. And Drew Burroughs is our technical director. Thank you for listening
1:01:31 to the Prop G Pod from the Vox Media Podcast Network. We will catch you on Saturday for No
1:01:37 Mercy, No Mouse, as read by George Hahn. And please follow our Prop G Markets Pod wherever you
1:01:40 get your pods for new episodes every Monday and Thursday.
1:01:51 Whew. I got a zit coming out of my face. I’ve not a zit in a while.
1:02:02 Makes me feel 18 again, actually makes me feel 15, 16, 17, 18, 19, 20, 21, 22, and 23 again. Oh my god.

0:00:06 Will the VP debate move the needle in what’s shaping up to be a neck-and-neck election?
0:00:09 You never know in advance what will be the thing that matters and the thing that doesn’t
0:00:10 matter.
0:00:18 But Donald Trump will be almost 80, and J.D. Vance will be one cheeseburger away from
0:00:20 the presidency should they win.
0:00:25 I’m Preet Bharara, and this week, The Atlantic magazine’s David Frum joins me on my podcast
0:00:29 Stay Tuned with Preet to break down what happened at the debate.
0:00:31 The episode is out now.
0:00:35 Search and follow Stay Tuned with Preet wherever you get your podcasts.
0:00:36 Hi, everyone.
0:00:43 I’m Brené Brown, and I’d love to tell you about a new series that’s launching on Unlocking
0:00:44 Us.
0:00:47 I’m calling it the On My Heart and Mind Podcast series.
0:00:50 It’s going to include conversations with some of my favorite writers on topics ranging
0:00:55 from revolutionary love and gun ownership to menopause and finding joy and grief.
0:00:58 The first episode is available now, and I can’t wait for you to hear it.
0:01:01 All new episodes will drop on Wednesdays, and you can get them as soon as they’re out
0:01:08 by following Unlocking Us on Apple or wherever you listen to your podcasts.
0:01:09 Welcome to Raging Moderates.
0:01:11 I’m Scott Galloway.
0:01:13 And I’m Jessica Tarliff.
0:01:18 Jess, so I’m trying to think, something happened, what’s happened recently?
0:01:19 What’s gone on here?
0:01:20 Can’t put my finger on it.
0:01:21 Can’t put your finger on it?
0:01:22 Let’s remind everybody.
0:01:24 Let’s play our greatest hits.
0:01:26 Roll tape.
0:01:31 One or just to follow up on that, the question was can you explain the discrepancy?
0:01:35 All I said on this was, is I got there that summer and misspoke on this.
0:01:39 So I will just, that’s what I’ve said.
0:01:45 So I was in Hong Kong and China during the democracy protest went in.
0:01:50 And from that, I learned a lot of what needed to be in governance.
0:01:52 He is still saying he didn’t lose the election.
0:01:55 I would just ask that, did he lose the 2020 election?
0:01:57 Tim, I’m focused on the future.
0:02:03 Did Kamala Harris censor Americans from speaking their mind in the wake of the 2020 COVID situation?
0:02:07 That is a damning, that is a damning non-answer.
0:02:09 It’s a damning non-answer for you to not talk about censorship.
0:02:13 Obviously, Donald Trump and I think that there were problems in 2020.
0:02:14 We’ve talked about it.
0:02:15 I’m happy to talk about it further.
0:02:19 But you guys attack us for not believing in democracy.
0:02:24 The most sacred right under the United States democracy is the First Amendment.
0:02:25 Thank you, Governor.
0:02:30 And just to clarify, for our viewers, Springfield, Ohio does have a large number of Haitian
0:02:35 migrants who have legal status, temporary protected status.
0:02:36 Thank you.
0:02:38 Senator, we have so much to get to.
0:02:44 I think it’s important because the rules were that you guys weren’t going to fact check.
0:02:47 And since you’re fact checking me, I think it’s important to say what’s actually going
0:02:48 on.
0:02:51 Those laws have been on the book since 1990.
0:02:52 Thank you, gentlemen.
0:02:56 The CBB One app has not been on the books.
0:03:02 Gentlemen, the audience can’t hear you because your mics are cut.
0:03:04 We have so much we want to get to.
0:03:06 Thank you for explaining the legal process.
0:03:07 Wow.
0:03:10 Jess, your thoughts?
0:03:17 I was on such an extreme emotional roller coaster last night watching this debate.
0:03:24 I was at Fox watching it with Kellyanne Conway, which is an incredible way to watch a debate
0:03:29 because she understands politics at a level far beyond me.
0:03:34 She’s obviously very close to the Trump side of things, but also can be very objective
0:03:35 about things.
0:03:38 So I always kind of love to be able to bounce things off of her.
0:03:45 But for the first few minutes, when it seemed like Tim Walls was going to lose his cookies
0:03:49 live on stage, I thought it was going to be catastrophic.
0:03:53 I just switched to praying, like, these things don’t matter, right?
0:03:54 We’re going to be fine.
0:03:57 This is about Trump and this is about Kamala.
0:04:02 And I was that way for about 10 minutes or so and was getting text messages from people
0:04:07 who even work on the campaign, very, very, very concerned.
0:04:12 And then I kind of leveled out to this was fine.
0:04:16 And that’s where I ended and it’s where most people seem to end and we can go into the
0:04:18 snap holes of it.
0:04:23 But the roller coaster of emotions, the feeling that JD Vance was everything that we thought
0:04:30 he would be, that he would present really well, that there wouldn’t be a misused word.
0:04:36 There was a lot of lying, but it all sounded excellent, which was the expectation.
0:04:41 And one thing and other people have commented on this and huge majorities of people who watched
0:04:43 the debate did as well.
0:04:49 It was so nice to have a substantive exchange of ideas that wasn’t petty.
0:04:51 There wasn’t name calling to it.
0:04:57 They were pretty polite, civil to each other when they agreed, they said, I’m an agreement
0:04:58 this way.
0:05:00 I guess it’s the epitome of Minnesota nice.
0:05:04 Since we know what walls thinks of Vance and we know what Vance thinks of walls.
0:05:07 But I think that that elevated this debate.
0:05:10 And there were a lot of people saying online, like, this is how the presidential debate
0:05:12 should have been.
0:05:16 It would have been, we would have been much better served if it had this kind of tone.
0:05:21 Yeah, I think that’s a good summary.
0:05:26 I thought to myself, I thought coming out of it, I’ve thought all along people underestimated
0:05:27 Vance.
0:05:30 I think she’s very, very intelligent.
0:05:35 And this darkness, this weirdness has the media’s run with it.
0:05:39 And that is just blatant, I don’t know how to put it any other way, misogyny.
0:05:43 There’s just a weirdness there to the guy and the media’s run with that and positioned
0:05:45 him as weird.
0:05:47 He is very intelligent.
0:05:52 He went to Yale Law School, which is three years in debate training, basically.
0:05:56 And I think on a balanced scorecard, you’d have to give the debate to him.
0:06:04 I don’t think, I mean, his ability to sort of bob and weave, you know, did Donald Trump
0:06:07 win the election or did Joe Biden win the election, that straight up question.
0:06:14 He managed to go to, well, Hillary refused to acknowledge the election, at least initially.
0:06:16 And even worse, you guys are engaging in censorship.
0:06:18 Now, that’s all bullshit.
0:06:21 Hillary did show up to the inauguration.
0:06:23 She did say, she did concede.
0:06:29 The notion that conservatives are somehow being censored is just so ridiculous.
0:06:35 It’s like, a decent tell is if someone screams censorship, it means they will not shut the
0:06:39 fuck up and that they’re everywhere, everywhere.
0:06:43 If you look at the people who are the biggest promoters of this myth around censorship in
0:06:51 America, they generally have one of the 10 most downloaded podcasts in the world.
0:06:59 So I kind of had a gag reflex around the lies, but he told them well.
0:07:01 He was very agile.
0:07:06 When I’m on boards, one of the first things I recognize, the key attributes of a successful
0:07:12 CEO of a big company is that they have to be a bit sociopathic.
0:07:16 And that is, I’ve been in all hands, or I’ve gone to in all hands as a director where the
0:07:20 CEO stands up and talks about the great future of the company, knowing that at 6 a.m. the
0:07:25 next morning, 15% of the staff of the workforce or 3,000 people are going to have their emails
0:07:30 shut off, their phones turned off, and they’re gone.
0:07:33 They’ll get an email from HR saying please call us.
0:07:35 You are no longer working in this firm.
0:07:40 And you’d think the guy was addressing his family at Thanksgiving dinner.
0:07:42 There’s just a sociopathy there.
0:07:47 And I was thinking about to go into a situation like this with so much pressure.
0:07:51 You’re plucked out of Minnesota governorship.
0:07:53 So much is riding on this.
0:07:59 I think that any human is going to have the same reaction, at least initially, that Governor
0:08:00 Wallace had.
0:08:02 And that is, he was a little bit nervous.
0:08:08 I thought he was better as the night went on, but Vance looked calm, cool, collected.
0:08:14 He was able to do all sorts of, he was very agile on his feet, came across as incredibly
0:08:15 bright.
0:08:23 The big winner, in my view, is America because this is how our elected representatives are
0:08:25 supposed to equip themselves.
0:08:27 They’re supposed to occasionally find common ground.
0:08:33 They interrupted each other, but only occasionally they were polite.
0:08:34 They acted like men.
0:08:36 I mean, they acted like grown fucking men.
0:08:41 And I thought, well, hopefully what this does is it shows that when you put Donald Trump
0:08:45 on stage or in any environment, it’s just chaos and bullshit.
0:08:48 But I’m not sure people will do that second order thinking.
0:08:50 So in some, I think America was the winner.
0:08:54 I think in terms of the race itself, I think it was probably a nothing burger.
0:08:58 VP debates have rarely been more than just sort of media fodder.
0:09:03 On a balanced, on a scorecard, I’d probably give the win to Vance.
0:09:04 Okay.
0:09:11 So a couple of things from that, I mean, we’re largely in agreement, but on the, the win
0:09:15 for Vance, because that was my feeling too.
0:09:20 And it was kind of like the elites vibe, you know, those of us who are now sitting with
0:09:23 podcasting equipment the day after this.
0:09:27 But when they were talking to undecided voters in these focus groups or doing these snap
0:09:31 polls, that wasn’t people’s overwhelming view of it.
0:09:33 So in general, it was a bit of a wash.
0:09:36 Vance and a couple had like a two point advantage.
0:09:38 Walls did it and a couple of them.
0:09:40 Most of it, it was like, this was a tie.
0:09:43 And it did not feel like a tie to me.
0:09:48 Even walls is going back and listening to the clips of where walls really succeeded didn’t
0:09:52 even hit me that, that well when it was happening.
0:09:57 And I don’t know if that was my protective crouch that I was in through the entire thing.
0:09:59 But there was more to the story.
0:10:04 So putting aside like who won or, or who lost, you know, it wasn’t like Kamala versus Trump
0:10:11 in that sense, but the favorability numbers are staggering from the CNN snap poll.
0:10:14 Walls was plus 14, went up to plus 37.
0:10:18 And Vance improved as well, but negative 22 to negative three.
0:10:22 So it’s like, we really hated you and now we just kind of dislike you.
0:10:24 That makes a difference.
0:10:28 Walls did better on who came across as reasonable versus extreme.
0:10:32 I’m sure we’re going to talk about the abortion issue, but that was one where JD Vance, even
0:10:36 though he, he said a lot of things that I think helped the Republican cause, like actually
0:10:41 talking about supporting women and being pro family and acknowledging that Republicans
0:10:43 have been terrible on this issue.
0:10:48 But people heard him loud and clear, which is if you live in a state that essentially
0:10:51 has an abortion ban, you live in a state that has an abortion ban and that really teed
0:10:52 up walls.
0:10:56 One of my favorite lines was that the right to control your own body shouldn’t depend
0:10:58 on geography.
0:11:01 That really stuck with me.
0:11:04 So reasonable versus extreme prepared to be president.
0:11:08 He had an edge on obviously the favorability and an abortion and healthcare and Vance’s
0:11:13 lead on the economy and immigration was like a couple points.
0:11:18 And those need to be blowout issues for Trump to win.
0:11:24 Now again, Vance is not top of the ticket and that was very clear from all of this.
0:11:31 But taken together, you obviously want to succeed in every opportunity that you have.
0:11:38 And it does feel like walls was able to accomplish even becoming or being part of the ban on
0:11:40 the divine side of this.
0:11:49 So if Trump is viewed as a cancer by a lot of people, Vance did not make it easier for
0:11:53 people to go to the Trump side of things.
0:11:57 Walls increasing his favorability, coming off as moderate and also so experienced.
0:11:58 I wanted to talk to you about this.
0:12:04 I was blown away by how much he relied on his background experience.
0:12:06 I mean, he talked about what he did as a congressman.
0:12:10 He talked about what they’re doing in Minnesota as governor, all the affordable housing units
0:12:11 he built.
0:12:14 Why they are the medical corridor, I think is what it’s called.
0:12:18 Why 3M is there, why all the health insurance companies are there.
0:12:21 Why it’s good to be a Minnesotan and what he’s done to do that.
0:12:26 And if you were watching the debate and you didn’t know that JD Vance was the senator
0:12:30 from Ohio and I told you he was the senator of Alaska, you could believe it.
0:12:31 If I said, “Oh, that guy?
0:12:32 He’s from Tennessee.”
0:12:34 And he just doesn’t have the accent.
0:12:35 You could believe it.
0:12:36 He said he’s from California.
0:12:40 I mean, he’s wearing a pink tie, which I thought was so lame.
0:12:43 You want women to like you, so you’re wearing a pink tie.
0:12:45 But he had no identity.
0:12:48 I have no idea who JD Vance is from that.
0:12:51 And like it or not, I know exactly who Tim Walls is.
0:12:57 We’ll be right back.
0:13:01 So everything you’re saying I find myself agreeing with, but I do think there’s a little
0:13:04 bit of bias there.
0:13:05 Call me out.
0:13:06 Yeah.
0:13:12 I think Walls, I think Walls’ best line was, and the reason Minnesota has the best healthcare
0:13:15 rating or whatever it is in the United States is simple.
0:13:17 We trust women and we trust doctors.
0:13:20 I thought that was very powerful.
0:13:24 But Vance was able to, I mean, here’s the bottom line.
0:13:29 Vance did more while having less to work with.
0:13:33 I mean, he’s literally at this point, the circus clown behind the elephant scooping
0:13:35 up Trump’s shit.
0:13:42 He’s the one that has to take the weirdness and somehow starch it, manicure it, shape-shift
0:13:47 it into something sort of reasonable on bodily autonomy.
0:13:48 We’ve pushed it back to the state.
0:13:51 They position it as freedom somehow.
0:13:55 And that is, it’s freedom in the sense that states should be able to decide that the federal
0:14:00 government should get out of, he almost positions it as we’re the one that cares about bodily
0:14:06 autonomy because we’re giving the states the autonomy to make their own decision.
0:14:12 He framed things that I find vile as almost kind of acceptable or understandable.
0:14:14 That was not easy.
0:14:17 I think Walls has a lot to work with.
0:14:21 Walls could, I mean, the bottom line is he’s facing, they’re not really debating each other.
0:14:24 They’re debating the top of the ticket.
0:14:29 And Walls has on the other side a guy who’s an insurrectionist and has been found liable
0:14:33 of sexual abuse, which in any other language is rape.
0:14:36 Walls had more to work with.
0:14:41 Vance given what he has, the cart, you know, the hand he’s been dealt came out, I thought
0:14:42 pretty good.
0:14:47 The bottom line though is I think this is a split decision and a nothing burger as it
0:14:49 relates to the race.
0:14:52 They both, I would say they both cemented their brand.
0:14:56 I think Walls is likable, and Vance is intelligent.
0:14:59 And that’s what I kind of came away, that that is their core brand.
0:15:03 But as it relates to the race, I don’t see this having any impact.
0:15:04 What are your thoughts?
0:15:10 In a tide race, which is where we are, there were new polls out this morning from the Cook
0:15:16 Political Report, you know, we’re in a margin of error race, and I doubt that that is going
0:15:17 to change.
0:15:21 Like maybe a couple states might move in X direction, or we know that Dems would be
0:15:26 favored in the blue wall states versus the Sun Belt for Trump.
0:15:32 And maybe I’m being liberal optimistic, liberal in my political sense, not liberal in how
0:15:41 I’m viewing this, but I think every moment counts, there’s 34 days to go, there’s already
0:15:48 an add up about the January 6th answer, and you know, not being able to say that Trump
0:15:56 lost in 2020, Harris camp already has it going, where it says the past will be the future.
0:16:01 And for the Republicans that are considering voting for Harris, people who came over in
0:16:06 2020, or maybe didn’t, maybe then saw January 6th, and were like, oh my God, we got to get
0:16:07 out of here.
0:16:11 This is like a burning building when it comes to preserving democracy.
0:16:12 Those kinds of things hit.
0:16:20 So even if this is just something that adds fodder to campaigns, or the campaigning,
0:16:22 I think it does matter.
0:16:27 And Walls is now, it seems like from his schedule going to be freed a bit more, we were talking
0:16:33 about it yesterday on the first podcast of the week, that Walls was so good at doing
0:16:35 media and then was kind of hidden away.
0:16:39 And you could see from last night that he really would have benefited from doing a few
0:16:40 Sunday shows.
0:16:45 JD Vance is out there, and he will say anything to anybody, you know, that interview with
0:16:49 Dana Bash was completely humiliating, good on him, that he’s going to go and do it.
0:16:54 And I think that Walls coming out of the gate suffered for not having those kinds of
0:16:56 reps.
0:17:01 And I hope that it is just, you know, what is it, balls to the Walls spelled like his
0:17:05 last name, that he’s just everywhere now, because he does have that charm, even for
0:17:10 something that is egregious and damaging.
0:17:14 You can’t think the guy is rotten to his core.
0:17:18 And JD Vance, you can think is slick and intelligent and all these things.
0:17:22 But a lot of people clearly are deeply suspicious of the character of the man.
0:17:26 And that was not abated by what happened last night.
0:17:30 We played in the montage the question, the response about Tiananmen Square and like where
0:17:32 he was.
0:17:37 And those little embellishments, they obviously haven’t heard him in dramatic fashion, like
0:17:39 in his favorability.
0:17:44 But I was very disappointed that there wasn’t a clear good answer, because the answer is
0:17:45 what he got to eventually.
0:17:46 I misspoke.
0:17:51 I was still there during the democracy protest, you’re talking about an eight-week differential
0:17:53 decades ago.
0:17:55 It doesn’t define who I am.
0:18:00 What defines who I am is that I celebrate democracy, and I created this humanitarian
0:18:01 exchange with China, et cetera.
0:18:06 I mean, do you think that stuff matters, or it’s just I’m being irritated as someone
0:18:08 too deep in politics?
0:18:11 The low point of the debate for either of them was that moment for walls.
0:18:15 Because he just said, I got carried away, I misspoke, I screwed up.
0:18:19 I’ve been to China, and I misspoke, and I apologize if I was wrong.
0:18:21 I just think he could have ended it there.
0:18:26 Instead it was sort of like asking your eight-year-old if they spelled their coke, and it was a little
0:18:30 bit of like awkwardness and feels like he’s not being totally fourth.
0:18:34 It was just the awkward moment of the debate, and it didn’t need to be awkward.
0:18:37 I agree with you that every moment counts.
0:18:40 The question is, was this moment consequential?
0:18:41 I don’t think it is.
0:18:47 I would argue that over the next 48 hours, how either campaign responds and/or leverages
0:18:53 and seizes a moment around Haleen and Israel is going to be much more consequential.
0:18:58 I think if either camp has seen as much more powerful, strong, deft at handling, either
0:19:04 exploiting Haleen and showing up in a jacket that says FEMA and being attentive to people’s
0:19:10 needs or being seen as strong on what’s happening in the Middle East.
0:19:16 There’s always an unintended foul ball out of nowhere that might change the game or whatever
0:19:18 the term is.
0:19:19 I don’t think this was that.
0:19:23 I think at 48 hours, if not 24 hours, I don’t even think we’re going to be talking about
0:19:24 this, Jess.
0:19:25 I just don’t.
0:19:27 It was a split decision.
0:19:28 Some people would go for walls.
0:19:32 I like what Jim Barksdale did, the former CEO of Netscape and AT&T said, and that is
0:19:36 if we’re going with opinions, let’s go with mine, otherwise let’s look at the data.
0:19:41 You brought some data, and it does look as if walls did better than I thought.
0:19:46 Having said that, I think we’re going to be talking about, I think this is going to shit
0:19:48 through a goose in the media cycle.
0:19:52 I think we’re going to be talking about some pretty consequential things that happen here.
0:19:56 I think either Israel or Haleen are going to have much more impact on this race and
0:19:57 what happened last night.
0:20:01 I was disappointed actually in the conversation around those two central issues.
0:20:03 The first question out of the gate.
0:20:05 Ukraine never came up.
0:20:07 Ukraine never came up.
0:20:13 An adjacent point going in vans for his isolationist stance, vans voted against Israel aid and
0:20:14 Ukraine aid.
0:20:17 That’s a layup for people.
0:20:22 People support helping our democratic partners and allies, especially when there’s an authority
0:20:25 in breathing down their necks.
0:20:27 I thought that was a missed opportunity.
0:20:29 We knew it was coming.
0:20:36 First question, and JD DeVance, I think has a very bad view on this and didn’t get held
0:20:40 to account on it, and walls went a little meandering about it.
0:20:45 He got out the right words about standing with Israel, but I thought he could have done
0:20:49 much better on that as well, because it has turned out to be more of a strong suit for
0:20:56 Kamala Harris than people expected, starting with the DNC speech and then moving on to
0:20:57 now.
0:21:04 JD Vance in his plus column, and this might be why you felt that he had the edge and that
0:21:10 I was sweating so bad about this, but he nailed all the lines Trump was supposed to nail.
0:21:14 You’ve had three and a half years to be able to fix this.
0:21:18 Don’t tell me what you’re going to do when you are essentially the incumbent, and we
0:21:22 know Vice President doesn’t have much power, but that is something that resonates with
0:21:23 people.
0:21:25 I thought that he nailed that.
0:21:26 Yeah.
0:21:32 Also, just a quick shout out to the raging moderators, Margaret Brandon and Norah Donald.
0:21:33 I thought they did a great job.
0:21:36 I get the sense that two of us should have brunch with them.
0:21:40 I think they’d love to have brunch with one of us, and it’s not the tall bald guy in
0:21:45 the UK right now, but I know Margaret a little bit because I’ve been on Face the Nation
0:21:46 a few times.
0:21:47 I don’t know if you’ve heard that.
0:21:48 No, I haven’t.
0:21:49 No, I haven’t.
0:21:50 I haven’t heard of it.
0:21:51 Girl can dream.
0:21:54 Long-winded way of saying, I thought the moderators are great.
0:21:58 I thought the whole thing was well done, made me feel good.
0:22:05 I really hope that all people up and down the ballot take a note from a patroness playbook
0:22:11 on this is how debates and candidates are supposed to handle themselves, and I really
0:22:16 do think that Margaret Brandon and Norah Donald were the clear winners.
0:22:23 I mean, this also might just be a lady thing that I was feeling at this level, but I loved
0:22:26 seeing two badass women doing it.
0:22:28 They looked perfect.
0:22:30 They were unflappable.
0:22:32 They were ready for everything.
0:22:36 I did not find the fact-checking to actually be fact-checking.
0:22:38 It was just like, and a note to our audience.
0:22:41 These people are here illegally, or a note to our audience.
0:22:42 Climate change is real.
0:22:43 That is fact-checking.
0:22:44 Come on.
0:22:47 They’re like interrupting someone and saying, don’t you tell that lie?
0:22:49 What are they supposed to do?
0:22:50 Are you supposed to leave it?
0:22:52 No, I think they’re supposed to fact-check.
0:22:57 I thought it was ridiculous for them to even say that we’re not going to fact-check.
0:23:00 Then why not just have a computer read the questions and shut off their mics after 90
0:23:01 seconds?
0:23:04 The whole point of a moderator is you’re supposed to moderate, and I think that when
0:23:08 someone says something outrageous and blatantly false, you should weigh in and say, there’s
0:23:10 no evidence that there’s aliens.
0:23:13 I mean, I don’t think they should have ever.
0:23:16 I think it was a mistake out of the gates to say that we’re not going to fact-check,
0:23:20 because one of Vance’s strongest moments was he just got back in their face and said,
0:23:24 the rules were you weren’t going to fact-check, so if we’re going to, let me fact-check him.
0:23:27 That was a powerful moment.
0:23:28 He wasn’t taking it.
0:23:29 He wasn’t taking it.
0:23:32 Anyways, what’s the next big thing here?
0:23:33 What do you think is the next?
0:23:36 Do we have anything else on the calendar that we need to be thoughtful around in terms of
0:23:37 this race, Jessica?
0:23:42 Well, there’s the question of whether there’ll be another debate.
0:23:45 Kamala has re-upped the, I’m going to show up.
0:23:46 I hope that you do too.
0:23:51 I feel like there’s a chance that Trump feels emboldened by this and he thinks that he could
0:23:52 do better.
0:23:56 Whether that’s in part being competitive with JD Van, so everyone says is fantastic.
0:24:00 I don’t know if you saw this, but he tweeted our truth socialed in the middle of the debate.
0:24:03 Pete Rose just died, which wasn’t true.
0:24:08 Pete Rose died the day before, but while you’re doing that, while your VP is standing
0:24:12 on stage is beyond me, though it’s not beyond me.
0:24:13 I thought it was a parody account.
0:24:15 No, it’s just dumb.
0:24:18 I mean, it’s like the guy just can’t control himself.
0:24:19 He literally can’t control himself.
0:24:25 Right, so I have like another debate, but you saw Trump pulled out of the CBS 60 Minutes
0:24:26 interview.
0:24:27 Not going to happen.
0:24:28 Kamala is doing it.
0:24:29 He thinks he’s going to win.
0:24:33 He thinks he’s going to win and anyone with an IQ above 90 is saying to him, “No, don’t
0:24:35 do whatever you can.
0:24:36 Try and put the phone down.
0:24:41 Try and put your thumbs down and do not speak to the public as much as you can.”
0:24:43 Any other observations, Jess?
0:24:46 A couple of things that I think were important.
0:24:52 The number one search political term across the entire country was abortion, and you know
0:24:54 what side that benefits.
0:25:01 JD Vanstead, his best attempt to sugarcoat a lot of this, talked about how sad it was
0:25:06 that Amber Thurman, the young mother in Georgia who passed away from sepsis, leaving a six-year-old
0:25:11 son behind because she couldn’t get medical care was, and then Amber Thurman’s family
0:25:20 released a statement thanking Governor Walz for his support and bringing those issues
0:25:21 to light.
0:25:22 Then what was the other thing that I said?
0:25:27 Well, we had said that the future of the Republican Party is less opaque because Vanstead looked
0:25:30 somewhat presidential given his age.
0:25:35 In 2028, I would think as of last night, he’s probably in Vegas, one of the top one
0:25:37 or two contenders for 2028 for the GOP nomination.
0:25:38 Totally.
0:25:39 I think that that’s right.
0:25:45 I think that his ability to cut through, like you said, to polish up the turd or whatever
0:25:51 that Donald Trump is, is something that will resonate with people.
0:25:56 If you didn’t watch him intently the last few months, you’d almost kind of like the
0:26:02 guy and think that his heart was in the right place and something, we’re not going to launch
0:26:07 into it, but that I did think he did well is, too, on immigration, he said, “I’m thinking
0:26:13 about Americans,” and that matters a lot to people who feel like they’re kind of being
0:26:14 left behind.
0:26:19 By the way, the country is moving, so yeah, I think that the Republican future is a lot
0:26:24 clearer than it was before the debate, which is a big forward-looking takeaway.
0:26:28 Well, it sounds like the police are coming for you, so that’s a signal we should wrap
0:26:29 it up here.
0:26:30 They are.
0:26:31 I gotta go.
0:26:33 Thank you for watching this episode.
0:26:34 Thank you for listening to Raging Moderates.
0:26:37 Our producers are Caroline Shagrin and David Toledo.
0:26:39 Our technical director is Drew Burroughs.
0:26:43 You can find Raging Moderates on the ProfG pod every Tuesday.
0:26:44 Please download and subscribe.
0:26:46 We’re after a huge start here.
0:26:47 We appreciate your listenership.
0:26:49 [music]
0:26:52 (upbeat music)
0:27:02 [BLANK_AUDIO]

0:00:01 [MUSIC PLAYING]
0:00:03 Support for the show comes from Mercury.
0:00:05 The simplest solution is often the smartest.
0:00:08 That’s where Mercury simplifies all your financial workflows
0:00:11 by powering them from one thing every business needs–
0:00:12 a bank account.
0:00:14 Now you can exit out of those endless tabs
0:00:17 and manage your banking, plus pay bills, send invoices,
0:00:20 and control spend all in one place.
0:00:22 Powerful banking, simplified finances.
0:00:24 Apply at mercury.com.
0:00:29 Support for Prop G comes from Anthropic.
0:00:32 It’s not always easy to harness the power potential of AI.
0:00:34 For all the talk about its revolutionary potential,
0:00:35 a lot of AI systems feel as if they’re
0:00:37 designed for specific tasks that are only
0:00:39 performed by select few.
0:00:42 Well, Cloud by Anthropic is AI for everyone.
0:00:45 The latest model, Cloud 3.5 Sonnet,
0:00:48 offers groundbreaking intelligence at an everyday price.
0:00:50 Cloud Sonnet can generate code, help with writing,
0:00:53 and reason through hard problems better than any model before.
0:00:55 You can discover how Cloud can transform your business
0:00:57 at Anthropic.com/Cloud.
0:01:00 [MUSIC PLAYING]
0:01:05 There’s over 500,000 small businesses in BC
0:01:07 and no two are alike.
0:01:08 I’m a carpenter.
0:01:09 I’m a graphic designer.
0:01:11 I sell dog socks online.
0:01:15 That’s why BCAA created one size doesn’t fit all insurance.
0:01:18 It’s customizable based on your unique needs.
0:01:20 So whether you manage rental properties or paint pet
0:01:24 portraits, you can protect your small business with BC’s most
0:01:26 trusted insurance brand.
0:01:29 Visit bcaa.com/smallbusiness and use promo code radio
0:01:31 to receive $50 off.
0:01:32 Conditions apply.
0:01:34 Welcome to the PropGPOD’s Office Hours.
0:01:36 This is the part of the show where we answer your questions
0:01:37 about business, big tech, entrepreneurship,
0:01:39 and whatever else is on your mind.
0:01:41 If you’d like to submit a question,
0:01:45 please email a voice recording to officehours@propgmedia.com.
0:01:49 Again, that’s officehours@propgmedia.com.
0:01:51 So with that, first question.
0:01:52 Hey, PropG.
0:01:54 This is Steve from Denver.
0:01:55 You’ve commented a number of times recently
0:01:58 on how the economy is doing better than people
0:02:00 are giving it credit for, including the episode with
0:02:02 Kyla Scanlon about the vibe session.
0:02:04 However, there are countless headlines just today
0:02:07 about the latest revision to the jobs report, which
0:02:10 is nearly 820,000 jobs downward.
0:02:13 My question is, do these seemingly constant downward
0:02:14 revisions give you any pause?
0:02:17 Thanks for your time and stop being so nice to Ed.
0:02:20 100% I’ll stop being less nice to Ed.
0:02:23 It’s just I feel bad for him.
0:02:24 He’s a lonely young man.
0:02:26 Back to your question.
0:02:28 I think a lot of it is AI.
0:02:30 I think, essentially, AI is sort of the perfect landing
0:02:31 lines for a soft landing.
0:02:33 What is a soft landing, you might ask?
0:02:36 It’s trying to cool the economy because you have inflation
0:02:40 while not pushing it into recession, which is not easy to do.
0:02:41 It’s like landing an air, I don’t know.
0:02:45 It’s like landing a propeller plane on an aircraft carrier.
0:02:46 It’s really fucking hard.
0:02:48 In high seas, if you will, what does AI do?
0:02:52 It reduces costs while increasing productivity.
0:02:53 Who was it, William Gibson?
0:02:56 Who was it that said, the future is here?
0:02:59 It’s just not evenly distributed.
0:03:01 I think the same is true of our economy.
0:03:02 And that is great.
0:03:04 Everyone’s saying the economy is up.
0:03:07 Better GDP growth and the rest of the G7, lower inflation
0:03:10 than the rest of the G7, which is a Goldilocks economy.
0:03:11 That’s great.
0:03:14 But my life just seems to be getting harder and harder.
0:03:16 And there was this fascinating study I read the other day
0:03:19 that said, if you look at France, which we don’t kind of look
0:03:22 to as a model for economic growth,
0:03:26 if you were to take out the top 1% of income earners
0:03:30 over the last several years, the bottom 99 in France
0:03:32 have done better than the bottom 99 in the US.
0:03:34 And that’s exactly what we have is we have an economy
0:03:38 that’s pretty prosperous, but it’s not evenly distributed.
0:03:40 And this is impacting every country.
0:03:42 I saw another stat that just blew my mind.
0:03:44 I’m here in the United Kingdom.
0:03:46 If you take out London out of the equation,
0:03:49 if you lifted London and all of its prosperity
0:03:52 in very, very wealthy households in London
0:03:55 out of the UK mix, the average household income
0:03:58 in the United Kingdom would be equivalent to Mississippi,
0:04:00 which has, I think the greatest levels of poverty
0:04:01 in the United States.
0:04:06 So essentially the UK is not a very prosperous nation
0:04:10 surrounding this Uber concentration of wealth
0:04:12 called one of the greatest concentrations of wealth
0:04:14 in history called London.
0:04:19 So I would argue that the economy’s actually doing fairly well.
0:04:23 Our fiscal policy, our tax policy makes the same mistake
0:04:26 over and over and that is people on the far right
0:04:28 and economists or some economists who are these free market
0:04:31 weirdos will claim that the middle class
0:04:33 is a naturally occurring organism.
0:04:33 No, it isn’t.
0:04:37 Anyone who’s done anything resembling any sort
0:04:38 of study of economic history says
0:04:40 that the middle class is an anomaly.
0:04:43 And typically what happens is there’s a group of people
0:04:45 who are very smart, very well connected,
0:04:47 very hardworking, very lucky, they get rich
0:04:48 and they start weaponizing government.
0:04:50 And people right now, wealthy people in America
0:04:52 don’t think they’re weaponizing government,
0:04:54 but they just happen to like, okay, just make sure
0:04:57 that when it comes to soybeans, if I’m a soybean farmer
0:05:01 that we continue to tax the shit out of foreign soybeans
0:05:02 and subsidize my industry.
0:05:05 And they aggregate so much power and so much money
0:05:07 that at some point the bottom 99% decide,
0:05:10 you know, the fastest way to double our income
0:05:13 would be to kill these 1% or to tell them
0:05:15 to leave the nation to pack their bags
0:05:17 and they’re out of here and then they nationalize
0:05:19 their business, that doesn’t work very well
0:05:21 and the whole cycle kind of starts over and over again.
0:05:23 And the question is, are we getting to that point
0:05:26 in the United States when six people control more wealth
0:05:28 in the bottom 50% of America?
0:05:30 And I think you’re seeing some populist movement,
0:05:33 you might call it populist or you might call it recalibration,
0:05:36 but unless we consistently invest or reinvest,
0:05:38 redistribute whatever the fuck you wanna call it,
0:05:41 money capital into the middle class,
0:05:43 we’re gonna have lower birth rates,
0:05:45 you have to have a middle class of men
0:05:47 that are attractive to women and men
0:05:50 who are not economically viable are not attractive to women.
0:05:53 Yeah, I said it and there’s a lot of evidence that shows that.
0:05:55 And we need a middle class that is thriving,
0:05:58 they fight our wars, they buy our products,
0:06:00 they are the citizens we need,
0:06:03 they generally we need them to be supportive of programs
0:06:06 that provide civil rights, women’s rights,
0:06:09 you know, to basically make a society great.
0:06:10 Certainly back to your question,
0:06:12 our economy in aggregate is killing it.
0:06:15 The problem is the future and prosperity
0:06:17 are in fact here in America.
0:06:19 It’s just not evenly distributed.
0:06:20 Thanks for the question.
0:06:23 Question number two.
0:06:26 – Hey Scott, it’s Greg calling from Nova Scotia, Canada.
0:06:29 I’m a father of three boys, a husband and a business owner.
0:06:31 I would really appreciate your thoughts
0:06:35 on Brian Chesky’s comments that he made recently
0:06:37 around founder mode.
0:06:41 I’m curious as you grew and scaled your businesses,
0:06:43 you talk openly about having a key person
0:06:47 that was the operator for you, but how did you negotiate
0:06:51 and manage your structure?
0:06:52 Was it a stovepipe?
0:06:53 Was it fairly flat?
0:06:55 Did you do skip level meetings?
0:06:58 Or did you really stay out of the day-to-day operations
0:07:02 of the business and leave it to your ops manager?
0:07:04 I would appreciate your thoughts on this
0:07:06 and I appreciate all that you do.
0:07:07 Thank you.
0:07:09 – What do you know, Greg’s from Canada.
0:07:11 The nicest, most intelligent,
0:07:14 how do you get 100 drunk fraternity brothers out of your pool?
0:07:16 Hey guys, would you please get out of the pool?
0:07:20 Boom, that never gets old, eh?
0:07:22 Anyways, this founder mode thing, I found it fascinating.
0:07:25 So founder mode is the idea that I think
0:07:26 what Brian was trying to say is that
0:07:28 he brought in all this professional management
0:07:29 that the company got off track
0:07:31 and he needs to kind of take the reins
0:07:34 and get more obsessed about the product.
0:07:36 And there are, and the, quote unquote,
0:07:38 professional management doesn’t work out.
0:07:40 That’s actually, there needs to be some nuance there.
0:07:43 By the way, I’m a huge fan of Brian Chesky.
0:07:45 Airbnb is one of my biggest stock holdings.
0:07:49 Look, there is a life cycle to companies.
0:07:50 And as they go through that life cycle,
0:07:55 as they go from start-up to venture-backed to growth,
0:07:58 to public company, to mature companies,
0:08:01 to declining companies, to distressed companies, right?
0:08:02 They require different management
0:08:04 across those parts of your life.
0:08:07 There are some people that are so talented
0:08:11 that they can traverse all of those ages, if you will,
0:08:13 or all of those components of the life cycle.
0:08:18 Most CEOs cannot, because back in my day,
0:08:20 in the ’90s, when I was starting companies,
0:08:22 founders were seen as a necessary evil.
0:08:23 And once the company was real,
0:08:26 you brought in some guy with gray hair from IBM
0:08:29 or Oracle or something and the VCs basically kicked out
0:08:30 the founder and the founder was lucky
0:08:33 he or she could stay chairman.
0:08:36 Then came Steve Jobs and they brought in John Scully,
0:08:38 who was hugely ineffective, the guy from Pepsi,
0:08:41 and then they brought back the crazy fucking founder
0:08:42 and he took the company
0:08:44 to be the most valuable company in the world.
0:08:45 Or actually, that’s not true.
0:08:46 He took it at 300 billion.
0:08:48 Tim Cook has actually taken it to 3 trillion.
0:08:49 Isn’t that weird?
0:08:52 Tim Cook has actually overseen a 10 or a 9x increase
0:08:53 in market capitalization,
0:08:55 but Steve Jobs is our Jesus Christ.
0:08:58 By the way, a guy who denied his blood under oaths,
0:09:00 such that he could avoid child support payments
0:09:02 when he was worth a quarter of a billion dollars.
0:09:05 Hey, that’s the guy I want my boys to role model after,
0:09:07 but oh, okay, he made a great fucking phone,
0:09:08 so let’s pretend he’s Jesus Christ.
0:09:11 Anyway, what you have is the pendulum
0:09:12 is swung the other way.
0:09:15 And that is VCs and the community has basically decided
0:09:18 that founders are the new Jesus Christ
0:09:19 and that you need that DNA.
0:09:22 And I’ve experienced it on boards where we put up
0:09:24 with so much bullshit from founders
0:09:27 because he or she was employee zero.
0:09:29 I think it has swung back way too far.
0:09:31 Probably peaked in terms of it swinging back
0:09:33 with Adam Newman where his board just listened
0:09:36 to this ridiculous bullshit where he was crashing
0:09:38 the equivalent of two Bombardier global expresses
0:09:39 into a mountain every week.
0:09:41 He was losing $100 million.
0:09:43 Anyway, it’s great from Nova Scotia.
0:09:46 That’s not your issue or that’s not your question.
0:09:47 So his notion is you go founder mode,
0:09:49 you’re kind of all over everything
0:09:50 and professional management comes in
0:09:51 and screws up companies.
0:09:52 No, they don’t.
0:09:54 The best companies, typically speaking,
0:09:57 have brought in professional managers,
0:09:59 Satya Nadella, Tim Cook.
0:10:00 They’ve all added more market cap
0:10:01 than the original founders.
0:10:03 Now, it’s probably harder to go from zero
0:10:05 to a billion market cap than it is to go from one
0:10:07 to 10 billion or 10 to 100 billion.
0:10:08 Or in the case of Tim Cook,
0:10:11 300 billion to 3 trillion.
0:10:12 Or in the case of Satya Nadella,
0:10:14 I think he’s taken it from, I don’t know,
0:10:17 800 billion to 3 trillion, whatever it is.
0:10:21 So I was on this panel of CEOs and it was a CEO,
0:10:22 I think from a way or rent the runway,
0:10:24 this digital firm and me.
0:10:26 And they said, they asked us,
0:10:29 what is your approach to management as a CEO?
0:10:30 And one person said, well, for me,
0:10:33 it’s all about creating a culture that empowers people.
0:10:35 Another person said, I think it’s really important
0:10:39 to identify what the roles and responsibilities are
0:10:41 and constant measurement and feedback,
0:10:43 but feedback that’s empathetic.
0:10:44 And then they turned to me and said,
0:10:47 my management strategy is I am all fucking over
0:10:49 everyone all the fucking time.
0:10:51 That is what founder mode meant for me.
0:10:52 I was involved in everything.
0:10:54 And I just don’t think there’s any getting around it.
0:10:56 I think if you’re serious about being an effective founder
0:10:58 and growing a profitable company
0:11:01 or a company worth the great shareholder value,
0:11:02 I just think you gotta be all over everyone
0:11:03 all the time, including yourself.
0:11:06 I think you gotta show that you came to play,
0:11:07 be obsessive about the product.
0:11:10 When I was running L2 for the first,
0:11:12 maybe even for eight years of the company,
0:11:15 nothing was allowed to leave and go to a client
0:11:16 unless I proved it first.
0:11:18 I felt like I had the voice.
0:11:19 I had an attention to detail.
0:11:21 I liked to write, I’m good at it.
0:11:23 I’m like, I wanna see everything before it goes out.
0:11:25 I find that this whole founder mode,
0:11:27 Zeitgeist coming out of the valley
0:11:30 is more basically more idolatry of innovators
0:11:32 that founder mode is somehow,
0:11:33 they’re not talking about the founders
0:11:35 of auto supply parts companies.
0:11:37 They’re talking about the founders of tech companies
0:11:40 that somehow they are smarter and no better
0:11:41 than the rest of management,
0:11:42 than the rest of companies,
0:11:43 than the rest of America,
0:11:44 than the rest of the world.
0:11:46 And it falls into this bullshit notion
0:11:48 that somehow these people have more insight
0:11:49 into the happenings of the world
0:11:52 and have more ability to fix problems.
0:11:53 As a matter of fact,
0:11:55 I would argue they’ve done more to fuck up the world
0:11:56 and actually help it.
0:11:57 Is that true?
0:11:58 Is that fair?
0:11:59 Maybe that’s not fair.
0:12:01 Definitely meta, definitely meta.
0:12:04 By the way, my dog is asleep here next to my desk
0:12:06 because we went founder mode on a walk this morning.
0:12:08 Oh my God, we chased some squirrels.
0:12:09 We said, hide a lot of people,
0:12:10 hide to a lot of people,
0:12:11 which freaks everybody out
0:12:13 ’cause the Great Dane,
0:12:14 which looks mildly like a cross
0:12:16 between a horse and an elephant,
0:12:18 just got beautiful elephant-like coloring,
0:12:21 is just great things are so funny though,
0:12:23 like shove their hind quarters into you
0:12:25 as a means of affection.
0:12:27 Whereas the little one looks really cute and innocent,
0:12:28 it’ll take your fucking thumb off.
0:12:30 They’d be like, “Hello.”
0:12:32 And like, you know,
0:12:33 and then I’m following the dog around at night
0:12:34 trying to pick up a shit
0:12:36 to see if I can find the neighbor’s thumb.
0:12:39 Not true, funny though, funny.
0:12:41 Anyways, don’t know where I was headed with that
0:12:43 other than to say thank you for the question.
0:12:47 We have one quick break before our final question.
0:12:48 Stay with us.
0:12:54 Support for Prop G comes from Vanta.
0:12:55 Whether you’re starting or scaling
0:12:56 your company’s security program,
0:12:58 demonstrating top-notch security practices
0:13:01 and establishing trust is more important than ever.
0:13:05 Vanta automates compliance for SOC2, ISO 27001,
0:13:06 and more, saving you time and money
0:13:08 while helping you build customer trust.
0:13:10 Plus, you can streamline security reviews
0:13:12 by automating questionnaires
0:13:14 and demonstrating your security posture
0:13:16 with a customer-facing trust center
0:13:18 all powered by Vanta AI.
0:13:20 Over 8,000 global companies
0:13:22 like Atlassian, FlowHealth, and Quora
0:13:25 use Vanta to manage risk and prove security in real-time.
0:13:26 Get $1,000 off Vanta
0:13:28 when you go to vanta.com/profg.
0:13:33 That’s vanta.com/profg for $1,000 off.
0:13:41 Support for Prop G comes from Fundrise.
0:13:43 It’s no secret that the AI industry
0:13:44 is growing through the roof right now.
0:13:46 You know it, your friends know it,
0:13:47 your dad even knows it,
0:13:48 but that doesn’t make it any easier
0:13:50 to start investing in the technology
0:13:52 of tomorrow, because most of the AI revolution
0:13:55 is being built and funded in private markets.
0:13:56 That means the vast majority of AI startups
0:13:58 are going to be backed and owned
0:14:00 by venture capitalists, not public investors.
0:14:01 The Fundrise Innovation Fund
0:14:04 is trying to change the landscape for regular investors.
0:14:06 The Innovation Fund pairs a $100 million
0:14:08 plus venture portfolio of some of the biggest names in AI
0:14:10 with one of the lowest investment minimums
0:14:11 in the venture industry.
0:14:13 AI is already changing the world,
0:14:15 but this time, you can get in early
0:14:16 with the Fundrise Innovation Fund.
0:14:20 You can get in early at fundrise.com/proppg.
0:14:21 Carefully consider the investment material
0:14:23 before investing, including objectives,
0:14:25 risks, charges, and expenses.
0:14:26 This and other information can be found
0:14:28 in the Innovation Fund’s prospectus
0:14:30 at fundrise.com/innovation.
0:14:32 This is a paid advertisement.
0:14:39 – Vox Creative.
0:14:42 – This is Advertiser Content from Virgin Atlantic.
0:14:44 – Hey, Carat Scott.
0:14:47 Remember me, the guy, Tina Fade, your Alec Baldwin,
0:14:49 sort of rejuvenated your career.
0:14:50 And he was, I’m at the lounge at Heathrow.
0:14:52 I’m at the Leathrow, the Virgin Lounge,
0:14:54 the Virgin Atlantic Clubhouse Lounge.
0:14:57 And I’m about to have the chicken tikka masala.
0:14:58 I love it here.
0:14:59 You should check it out.
0:15:00 It’s where the cool kids hang out.
0:15:03 Anyways, hope you’re all safe travels.
0:15:05 – Scott, frankly, it’s a miracle that Virgin Atlantic
0:15:06 let you into the clubhouse
0:15:08 and their incredible business class.
0:15:09 But I guess they did.
0:15:11 Tell me how it was.
0:15:13 – So, Carat, I’m an original gangster
0:15:14 when it comes to Virgin.
0:15:19 I’ve been flying Virgin for 20 plus years.
0:15:20 And I do the same thing.
0:15:22 And they get it right every time.
0:15:24 They always have the financial times for me.
0:15:26 And I order the chicken tikka masala.
0:15:30 And that is my Virgin experience.
0:15:31 If it ain’t broke, don’t fix it.
0:15:34 – And your drink was, what is your drink?
0:15:36 – Well, I used to drink a Bloody Mary
0:15:38 or a beer in the clubhouse.
0:15:41 I started, I don’t drink alcohol when I travel anymore.
0:15:42 So I just do mineral water,
0:15:44 but they have this kind of cool cocktail
0:15:46 that’s like a lemongrass
0:15:48 or some sort of cool margarita thing.
0:15:49 And I get a Virgin one.
0:15:51 – What is your pre-flight routine?
0:15:54 What is your actual, besides your chicken tikka masala,
0:15:55 the Virgin clubhouse?
0:15:58 – My pre-flight routine is,
0:15:59 well, I always do the same thing the morning when I travel.
0:16:00 I try and work out.
0:16:01 I take the dogs for a walk.
0:16:03 And I always make time for the clubhouse
0:16:05 ’cause I do enjoy the Virgin clubhouse at Heathrow.
0:16:08 So check out virginatlantic.com for your next trip
0:16:10 and see the world differently.
0:16:12 – Certain amenities are only available
0:16:13 in selected cabins and aircraft.
0:16:20 Welcome back, question number three.
0:16:22 – Hey, Prop G, this is Natalie.
0:16:25 I’m calling in from Northern Virginia.
0:16:26 Appreciate you taking my question
0:16:29 and for all the work you do on the pod.
0:16:30 I am in my early 20s
0:16:33 and I just graduated college with an econ degree.
0:16:35 I am a financial analyst
0:16:37 at a pretty big government contracting firm
0:16:40 and I love my job.
0:16:42 My boyfriend also just graduated college.
0:16:44 He commissioned as an officer in the Marine Corps
0:16:47 and we’ve been together almost four years.
0:16:50 We both come from military families.
0:16:52 So I’m pretty familiar with the lifestyle
0:16:56 I’m about to enter into as a future military spouse.
0:17:00 So I’m not sure if you’re familiar with the term BAH
0:17:02 but I am gonna have to explain it for my question.
0:17:05 So I’ll give a short overview.
0:17:07 BAH is basic allowance for housing
0:17:09 and it’s essentially a housing supplement
0:17:12 for a soldier who lives off base.
0:17:14 It can be used for whatever the soldier wants
0:17:16 because it’s just added into their paycheck
0:17:17 with their normal pay.
0:17:21 The other part of this is if a soldier is married
0:17:24 or has a kid, they get even more added
0:17:26 to that BAH payment, every paycheck.
0:17:29 An 18 year old out of college
0:17:31 or I’m sorry, an 18 year old
0:17:32 enlisting right out of high school
0:17:35 has huge incentives to marry the first person
0:17:37 who shows a remote interest in them
0:17:39 because the benefit to them
0:17:42 is between six and 12 grand a year.
0:17:46 Do you agree with me that this is an outdated policy
0:17:49 that incentivizes soldiers to get married too young
0:17:52 and contributes to the high divorce rate in the military?
0:17:54 I’d love to hear your take on this
0:17:56 and thanks for everything you do.
0:17:58 – So first off, Natalie,
0:18:00 it just makes me feel really good about America.
0:18:03 We have people in the early 20s
0:18:06 who are as impressive and as articulate as you,
0:18:11 degree in economics and are connecting and marrying
0:18:13 someone who’s going into the Marines as an officer.
0:18:16 I just kind of want to wrap myself in a flag right now.
0:18:18 So back to your question.
0:18:20 According to data from the US Census Bureau,
0:18:21 those who have served in the military
0:18:22 tend to have higher divorce rates.
0:18:24 In 2022, the rate for divorce
0:18:26 among all active duty members was 3%.
0:18:29 So that’s higher than the actually the,
0:18:31 I think that’s annually every 3%.
0:18:32 I don’t know.
0:18:33 Anyways, it’s higher.
0:18:35 I think you would need data to support
0:18:40 that thesis because is it the fact they get married young?
0:18:41 You would need to control it for things.
0:18:44 In other words, compare enlisted people
0:18:45 or compare people in the service
0:18:47 who get married at 25 or 30
0:18:49 versus those who get married at 18.
0:18:51 I’m remiss to get in the way of any program
0:18:53 that puts more money in the pockets of young people
0:18:56 and especially young people starting families.
0:18:59 I think the family unit, I’ve kind of come 180 on this.
0:19:00 When I was your age, I’m like,
0:19:02 I’m never getting married and I’m never having kids.
0:19:03 I’m a selfish person.
0:19:04 I like to work.
0:19:05 I’m fine on my own.
0:19:09 I do my own thing and I’ll have relationships
0:19:13 but I’m not interested in this construct called marriage.
0:19:17 It was invented by a bunch of gay dudes in a church
0:19:19 who wanted to make sure that women didn’t struggle
0:19:21 with poverty, women are doing fine on their own.
0:19:21 They don’t need marriage.
0:19:22 I don’t need marriage.
0:19:24 I had this kind of what I thought was involved,
0:19:26 hip, cool, vision of marriage.
0:19:28 I wouldn’t have gotten married had I not had kids
0:19:31 and raising kids was a competent partner
0:19:33 is the most rewarding thing in my life.
0:19:35 So I was all wrong about it.
0:19:37 Kids are becoming a luxury item.
0:19:39 So I just don’t like the idea of doing anything
0:19:42 that would get in the way of supporting young families.
0:19:46 And I would imagine, and this is just per speculation,
0:19:49 that the stresses placed on a military family,
0:19:52 specifically with the person serving being gone all the time
0:19:54 would be that is what it would be really difficult
0:19:56 on marriages that it’s not economics
0:19:58 or it’s not getting married too young.
0:19:59 Although I agree, that’s not a great idea.
0:20:02 The idea of getting married at 18 seems just strange
0:20:05 and I kind of, I don’t call it bound for failure
0:20:07 ’cause a lot of them stay married the rest of their lives.
0:20:10 But God, I mean, at the age of 23,
0:20:11 I was different than I was at 18,
0:20:14 much less 33 versus 18, you really are,
0:20:18 especially men at 18, they really are boys.
0:20:22 But this is a long way of saying, I don’t really know,
0:20:24 but I think the problem, quite frankly,
0:20:25 is not putting enough money.
0:20:27 I think if we wanted to lower divorce rates,
0:20:30 we’d actually put more money in the pockets of young people.
0:20:31 Thanks so much.
0:20:33 And again, you just make me,
0:20:34 hearing about you and your fiance,
0:20:36 it just makes me proud to be American.
0:20:38 Thanks for the question.
0:20:39 That’s all for this episode.
0:20:40 If you’d like to submit a question,
0:20:41 please email a voice recording
0:20:43 to officehours@propertymedia.com.
0:20:46 Again, that’s officehours@propertymedia.com.
0:20:58 This episode was produced by Caroline Shagren.
0:21:00 Jennifer Sanchez is our associate producer
0:21:02 and Drew Burroughs is our technical director.
0:21:04 Thank you for listening to the Prop G Pod
0:21:05 from the Vox Media Podcast Network.
0:21:07 We will catch you on Saturday
0:21:10 for No Mercy, No Malice, as read by George Hahn.
0:21:12 And please follow our Prop G Markets Pod
0:21:14 wherever you get your pods for new episodes
0:21:16 every Monday and Thursday.

0:00:01 (upbeat music)
0:00:03 Support for the show comes from Virgin Atlantic.
0:00:04 Let’s talk about flying.
0:00:06 I do it, you do it, we all do it,
0:00:09 but it really comes down to how we do it.
0:00:10 When you fly Virgin Atlantic,
0:00:12 then make it a memorable trip
0:00:13 right from the moment you check in.
0:00:15 On board, you’ll find everything you need to relax,
0:00:17 recharge, or carry on working.
0:00:19 Live flat, private suites,
0:00:21 fast wifi, hours of entertainment,
0:00:23 delicious dining and warm,
0:00:26 welcoming service that’s designed around you.
0:00:27 Check out virginatlantic.com
0:00:29 for your next trip to London and beyond,
0:00:31 and see for yourself how traveling for business
0:00:33 can always be a pleasure.
0:00:38 – Hey, I’m John Glenn Hill,
0:00:41 host of a brand new show from Vox called “Explain It To Me.”
0:00:45 This week, the ethical murkiness of zoos.
0:00:47 – Do we as humans feel like we deserve
0:00:49 to just be able to walk around and see these animals?
0:00:52 Like, maybe we don’t deserve that.
0:00:55 Maybe there’s just some animals we don’t get to see.
0:00:57 – To zoo or not to zoo?
0:01:00 That’s this week on “Explain It To Me.”
0:01:02 Listen wherever you get your podcasts.
0:01:09 – An experimental procedure that is giving hope to–
0:01:11 – To get a heart transplant
0:01:13 from a genetically modified pig.
0:01:15 – There’s over 100,000 people
0:01:17 on the organ transplant wait list.
0:01:21 And some scientists think the answer might be pigs.
0:01:24 – Nobody in the world knew how a human
0:01:27 would react to a pig heart, right?
0:01:29 The next day when we asked him,
0:01:30 “You know, how are you feeling?”
0:01:31 He said, “Oink, oink.”
0:01:34 – This week on “Unexplainable,”
0:01:37 are pig hearts really the answer?
0:01:40 Follow “Unexplainable” for new episodes every Wednesday.
0:01:45 – Welcome to “Raging Moderates.”
0:01:46 I’m Scott Galloway.
0:01:48 – And I’m Jessica Tarlev.
0:01:49 – Jessica, where are you today?
0:01:50 What are you up to?
0:01:51 What are you doing?
0:01:52 – I’m at my mom’s house.
0:01:56 Like all good 40-year-old women who need a fireplace.
0:01:57 So they go to their mom’s apartment
0:01:59 to escape a potty training codler.
0:02:00 – I think the way you’re supposed to do it
0:02:03 is you have mom come over and watch the kids
0:02:04 and you go to the spa
0:02:06 or go to your friend’s house and eat ice cream
0:02:08 and smoke cigarettes.
0:02:10 I’m making a bunch of gender stereotypes here.
0:02:11 – I get it.
0:02:12 I’d like to continue with that, though,
0:02:15 to add to it that when my mom started dating again
0:02:18 after my dad passed away, when we were gonna put her online,
0:02:19 the joke was that her tagline
0:02:22 should be not that kind of grandma.
0:02:24 So she would not be the one coming over
0:02:28 to take care of the toddler and to do the potty training.
0:02:31 No, I mean, she’s into it, but she needs assistance.
0:02:34 She’s not a solo rider when it comes to that stuff,
0:02:37 but I’m appreciative of the apartment.
0:02:40 – Today, in today’s episode of “Raging Moderates,”
0:02:42 we’re previewing the VP debate.
0:02:44 Kamala Harris’ trip to the border
0:02:46 and her new economic plan, we’re gonna talk about it.
0:02:49 We’re gonna discuss NYC Mayor Eric Adams’ indictment
0:02:52 and to wrap up the episode, former Maryland governor,
0:02:54 Larry Hogan joins us for a quick discussion
0:02:56 on how the Republican Party feels about the election
0:02:59 and what it takes to govern across party lines.
0:03:02 All right, let’s light this candle.
0:03:03 The VP debate is here.
0:03:06 J.D. Vance and Tim Walls are going head to head
0:03:08 with just a month to go before election day.
0:03:10 Vance has been reviewing footage of Walls’ previous speeches
0:03:13 and studying his past policies.
0:03:14 Meanwhile, Walls spent the weekend
0:03:16 hunkered down in debate camp in Michigan
0:03:19 with Transportation Secretary Pete Buttigieg
0:03:21 playing the role of Vance in mock debates.
0:03:23 Jess, what’s your take here?
0:03:25 What should we expect on stage
0:03:26 and is this really going to move the needle?
0:03:28 Doesn’t matter.
0:03:30 – I think that it could matter.
0:03:33 I mean, historically, they don’t matter as much,
0:03:34 but there are a few instances
0:03:36 where I think people really got the message,
0:03:39 including the Joe Biden debate with Paul Ryan,
0:03:42 where I feel like really solidified things
0:03:45 for the ticket there in 2012.
0:03:46 – You think he beat Paul Ryan?
0:03:48 – I do, yeah.
0:03:50 I think Paul Ryan came off as wonky and detached
0:03:53 and Joe Biden was wonky and attached,
0:03:55 which made a big difference.
0:03:59 But I think this, similarly to the first debate,
0:04:03 I think this matters a lot more for the Democratic side
0:04:06 than it does for the Republican side.
0:04:08 I think that folks that are dug in
0:04:11 and they’re voting Trump Vance are voting Trump Vance
0:04:13 and there’s a lot more room to grow on the Democratic side
0:04:16 in terms of getting to know this ticket.
0:04:19 And something that I think Politico covered it,
0:04:22 but that has just been kind of ruminating in my circle,
0:04:25 is that one of the main reasons walls was picked
0:04:27 was that he was really good in interviews.
0:04:28 Remember, he was the first guy to say,
0:04:29 “They’re just really weird.”
0:04:31 I think he was on with Stephanie Ruhle.
0:04:34 And he was constantly on air.
0:04:36 And he was on our air on Fox, he was on CNN,
0:04:39 he was on MSNBC, doing every radio show.
0:04:42 And he’s disappeared a bit.
0:04:44 People haven’t seen him really since he became the VP
0:04:46 in the same way.
0:04:49 And so I think that this is a big opportunity
0:04:53 for him to remind people, like I’m good at this.
0:04:56 I may not be as wonky, but I know my shit.
0:04:58 I can talk to you about my record
0:05:00 and I don’t think you should apologize.
0:05:03 I know that the summer of the Black Lives Matter riots
0:05:06 is gonna come up and Minneapolis burning, et cetera.
0:05:08 I think he can make a really clear case
0:05:09 for why he’s been a great governor.
0:05:13 He won re-election in 2022 by an even larger margin.
0:05:14 He can talk about all of that.
0:05:16 But I think that he needs to remind people
0:05:19 that we are the normal ones.
0:05:23 He can do the job and that they’re ready on day one for this.
0:05:27 And someone smarter than me said to me,
0:05:29 “If you look at the transcript after the debate,
0:05:32 “don’t be surprised if it looks like JD Vance won,
0:05:34 “but in reality, Tim Walls did.”
0:05:36 Which I thought was an interesting way of looking at it.
0:05:37 What are you expecting?
0:05:40 And are you gonna stay up through the middle of the night
0:05:40 to watch?
0:05:41 – What time is it?
0:05:42 Is it 9 p.m.?
0:05:44 – 9 p.m., I don’t know why they do this all so late.
0:05:46 It should be like a 7.30 start, but.
0:05:48 – Well, yeah, but there’s this terrible thing called
0:05:50 California with 35 million people in it.
0:05:53 So it’s 6 p.m., I think it’s the best they can do.
0:05:55 And I’m not sure they’re catering
0:05:58 to the angry depressed people that relocated
0:06:01 from Delray Beach to London.
0:06:02 – Small demo.
0:06:05 – Yeah, I don’t know if we’re critical here.
0:06:09 Anyways, I was going to this a bit.
0:06:11 I think JD Vance is very intelligent.
0:06:13 I just think fundamentally, he’s a mythogenist
0:06:16 and also quite strange and has very fucked up views
0:06:18 on the relationship or the intersection
0:06:21 between government and civil liberties and women.
0:06:24 I think there’s something off there.
0:06:27 At the same time, if you’ve read his book,
0:06:29 I just don’t think there’s anything getting around it.
0:06:32 I think he’s brilliant, I think he’s very intelligent.
0:06:37 Also, there’s a certain sociopathy that he has demonstrated
0:06:40 given just how poorly he’s done, given that he’s probably
0:06:43 the least, I believe he’s the least popular VP pick
0:06:46 in history at this point in terms of his negatives.
0:06:48 It doesn’t seem to have phased him.
0:06:50 I bet he’s thinking this is a chance for me
0:06:54 to really kind of go hard and pick apart on arguments.
0:06:57 I think he’s going to be a formidable debating opponent.
0:07:02 Now, I would imagine if I had to project or speculate,
0:07:03 my guess is a lot of people are going to tune in
0:07:06 because they’re hoping for a total food fight.
0:07:10 But I just wouldn’t, I think Senator Vance is strange.
0:07:13 He is, I mean, we had Anthony Scaramucci
0:07:15 on the prop cheap pod and he described Steve Bannon
0:07:17 as one of the smartest people he knows.
0:07:20 And there’s something wrong there.
0:07:22 I think Steve is, I can’t even figure out
0:07:24 how he’s gotten to the place he’s gotten to
0:07:25 in terms of what he believes about America
0:07:28 and being an apologist for the insurrection.
0:07:30 I think J.D. Vance has cut from that cloth.
0:07:34 He’s one of those people that you know is just so bright,
0:07:36 but you can’t quite square the circle
0:07:39 on why he would decide to say that our country
0:07:40 is run by a bunch of people in New York
0:07:45 living in $5,000 a month, one bedroom apartments
0:07:48 who are childless and deeply unhappy.
0:07:50 I mean, I’m sure those people exist in New York.
0:07:52 The most of the people I know in New York are loving life,
0:07:54 are pretty happy.
0:07:57 And it’s like, where does he get this stuff
0:07:59 and what happened?
0:08:02 If there’s more of that, walls will win,
0:08:04 but I think he’s more disciplined than that.
0:08:06 I think walls right out of the gates
0:08:09 needs to do with Vice President Harris did
0:08:11 and try and put him on his heels
0:08:14 and talk a lot about some of the just ridiculous things
0:08:16 he said, what are your followup thoughts?
0:08:20 – I think he’s taking the culture war too far
0:08:23 and people who tend to live and die by the culture war,
0:08:26 it often doesn’t marry up with actually being super smart.
0:08:28 And that’s where JD Vance is,
0:08:31 the intersection of that.
0:08:34 He’s obviously wrong about New York and I grew up here
0:08:38 and most people here are what you describe,
0:08:43 but if he manages to rise above the fray
0:08:45 and I feel like walls will be throwing a lot
0:08:47 of this childless cat lady stuff at him,
0:08:50 eating the cats, eating the dogs,
0:08:52 they’re gonna be met with a very different response
0:08:55 than Trump who just starts sputtering
0:08:56 whatever he’s seen online
0:08:59 or what he’s seen from his favorite commentators.
0:09:02 And it is a bigger uphill battle,
0:09:04 I think than it would be in a debate with Trump.
0:09:07 And during the vetting process,
0:09:10 apparently walls voiced concern to Harris’s team
0:09:12 that he’s not a great debater.
0:09:15 He did say, I can do it, I have done it,
0:09:17 I don’t believe it’s one of my key strengths
0:09:20 and it’ll be interesting to see how nervous he is.
0:09:21 I mean, this is by far and away
0:09:24 gonna be the biggest night of his political life
0:09:27 and he’s the governor of a major state, right?
0:09:30 The sixth best state in the country to do business
0:09:33 and tomorrow night is going to be even bigger for him.
0:09:37 So I hope he just goes ahead with his game plan.
0:09:40 I think Pete Buttigieg knowing JD Vance,
0:09:42 like he’s got his number, right?
0:09:45 He knows exactly who he is, both have served,
0:09:48 talk about the same kind of values with Pete Buttigieg
0:09:50 actually living them versus JD Vance,
0:09:53 purporting to live by them.
0:09:57 And I think they will talk about really personal stuff
0:10:00 like immigrants with JD Vance married
0:10:03 to the child of Indian immigrants, talk about religion.
0:10:07 He was out over the weekend with a Christian nationalist
0:10:10 on his tour, the courage tour.
0:10:13 Someone who has said that Kamala Harris is possessed
0:10:14 by demons.
0:10:16 I think that all of these kinds of themes will be coming up
0:10:19 and if JD Vance can steer clear of a lot of it,
0:10:22 I think his favorability will still be negative 13,
0:10:23 but nothing will be hurt.
0:10:26 All the room to gain is really on walls aside.
0:10:28 – Yeah, I think the surprise issue here,
0:10:31 everyone’s expecting them to bring up immigration,
0:10:33 kind of the two eyes immigration inflation.
0:10:35 I think the third eye is going to play
0:10:38 perhaps a surprise role here and that’s Israel.
0:10:40 And there’s been so many, in my view,
0:10:43 really positive developments around debilitating,
0:10:47 defenestrating, decapitating, kneecapping,
0:10:49 whatever other terms I can come up with
0:10:52 for the largest terrorist organization in the world.
0:10:55 And I wonder who’s going to bring up Israel
0:10:59 and I think they’re going to try and out Israel each other.
0:11:03 I think both think, okay, I need to be to show anomalous
0:11:07 to the support or lack thereof or milk toast language
0:11:10 we’ve heard out of the White House regarding support Israel.
0:11:12 I think they’re both going to be trying to outmatch
0:11:15 each other and show even more and more resolute support
0:11:16 for Israel.
0:11:17 What are your thoughts?
0:11:18 – I wouldn’t be surprised.
0:11:20 It probably will be a question as well,
0:11:22 just since it’s so in the news
0:11:25 with, you know, dismantling Hezbollah.
0:11:30 And last night, I went to Douglas Murray,
0:11:33 who is a conservative commentator and journalist,
0:11:35 has something called the Save the West tour.
0:11:37 And he was at the Beacon Theater
0:11:41 and my husband and I went to see what it was all about.
0:11:45 And I disagree with a ton of Douglas Murray’s beliefs,
0:11:47 especially when it comes to Islam.
0:11:52 But he did go and embed in Israel right after 10/7.
0:11:53 He was embedded with the Ukrainians as well
0:11:55 after Putin invaded and he’s done a lot
0:11:58 of really interesting journalistic work.
0:12:02 And I mean, I could do hours on my takeaways from it.
0:12:05 But what really stuck out to me is that this room
0:12:09 that was full of Jews and Jewish allies
0:12:14 as far as the state of Israel really needed to be in a place
0:12:19 where they didn’t have to counter their feelings
0:12:21 about the Israeli offensive with,
0:12:24 of course, any loss of innocent life is a tragedy
0:12:26 or where they wouldn’t be called genocidal
0:12:29 for supporting BB’s actions.
0:12:33 And I felt that very strongly and he made one comment,
0:12:35 you know, whether you lean left
0:12:36 and no one really said anything
0:12:40 or whether you lean right and there was booming applause.
0:12:43 Now, that does not mean New York is going for Trump
0:12:45 or that Jews are going for Trump,
0:12:48 but you can see a desire on the behalf of people
0:12:53 who support Israel to not have to sugarcoat things,
0:12:58 especially in this moment, to just be damn proud of the IDF
0:13:00 and what they’ve been able to pull off.
0:13:03 You know, people wearing T-shirts that say bring them home,
0:13:06 saying I want to talk about the hostages every single day
0:13:09 until these people are back with their families.
0:13:13 It was moving in that respect on a very deep level
0:13:17 and I saw something that I had kind of read about firsthand
0:13:20 and was very thankful for the experience.
0:13:24 – I do think that the, what I’ll call the precise,
0:13:25 I mean, I would argue what’s happened
0:13:26 over the last couple of weeks
0:13:31 is the most precise anti-terrorist action taken in history.
0:13:35 And I do think that the Gulf nations,
0:13:38 the world do respect strength and that kind of expertise
0:13:41 and that kind of unapologetic defense.
0:13:43 And I’d like to think that this weird anti-American,
0:13:47 anti-Israel sentiment, largely or kind of the tip
0:13:49 of the spear has been the zombie apocalypse
0:13:52 that’s taking place in my industry on campuses
0:13:55 or the zombie apocalypse of useful idiots.
0:13:57 I would like to think that it’s bottomed,
0:13:59 that people see okay.
0:14:02 They are taking out people who were killing Americans
0:14:05 and thousands of Syrians and thousands of Lebanese
0:14:08 and have just invoked and created
0:14:12 so much despair and tragedy across Lebanon.
0:14:14 And there were people celebrating in the streets
0:14:16 across the Gulf at this guy’s death.
0:14:19 So I’m hoping this is a turning point
0:14:20 and just to bring it back,
0:14:23 I’d be shocked if it didn’t become
0:14:26 a pretty significant piece of content tonight.
0:14:28 – Yep, agreed.
0:14:31 And I will say, I thought that Kamala’s statement
0:14:34 on the murder or taking out of a Nuzrola
0:14:35 was very strong.
0:14:38 She called him a terrorist in the opening line.
0:14:41 And that’s exactly the kind of spirit
0:14:44 that we need to take to this fight.
0:14:47 And a crazy couple of weeks,
0:14:51 but I think that everyone is moving in the same direction
0:14:53 to your point about what’s going on on the campuses,
0:14:56 what commentators are saying, et cetera.
0:15:00 And BB’s kind of said, I’m gonna do this no matter what.
0:15:02 So are you coming with me?
0:15:05 Or I’m gonna take out someone that killed two,
0:15:10 it was a 250 Americans have been murdered by Nuzrola too.
0:15:13 – Yeah, yeah, well, it was a U.S. ordinance.
0:15:14 It was a U.S. missile.
0:15:16 They took out Hezbollah headquarters.
0:15:19 Okay, so anyways, we’ll be back after a quick break.
0:15:28 – When Kamala Harris and Donald Trump met
0:15:30 on the debate stage, it was obvious
0:15:33 that these were two very different people.
0:15:36 – But JD Vance and Tim Walls actually have a lot in common.
0:15:38 They’re both white men from the Midwest.
0:15:40 They’re both family men, and they were both in the service.
0:15:43 – But they disagree on what it means to be a man.
0:15:45 – Here’s my light pack.
0:15:47 Surround yourself with smart women and listen to ’em,
0:15:49 and you’ll do just fine.
0:15:51 – Today explained, every weekday,
0:15:52 wherever you get your podcasts.
0:15:58 – This week on Prophogy Markets,
0:16:00 we speak with Lena Kahn,
0:16:02 chair of the Federal Trade Commission.
0:16:04 We discuss ongoing antitrust cases,
0:16:06 how to measure consumer harm,
0:16:08 and her take on monopolies in big tech.
0:16:11 – We went through a 20-year period
0:16:14 where the Big Five technology companies,
0:16:17 Apple, Facebook, Google, Microsoft, and Amazon
0:16:20 collectively made over 800 acquisitions,
0:16:23 and not a single one of which was challenged at the time.
0:16:25 And now there are lawsuits
0:16:27 kind of retroactively identifying
0:16:30 that some of those were missed opportunities
0:16:32 and failing to stop those deals
0:16:34 had a really negative impact on the market.
0:16:37 – You can find that conversation and many others
0:16:39 exclusively on the Prophogy Markets podcast.
0:16:44 – Moving on, Harris made her first trip
0:16:45 to the US-Mexico border
0:16:47 since becoming her party’s presidential nominee.
0:16:49 This was only her second time there
0:16:51 as Vice President during her visit.
0:16:53 She criticized Trump’s immigration efforts.
0:16:55 Let’s have a listen.
0:16:59 – He made the challenges at the border worse.
0:17:01 And he is still,
0:17:06 and he is still fanning the flames of fear and division.
0:17:10 – The visit comes at a time when polls show voters trust
0:17:12 Trump and Republicans more in immigration.
0:17:13 And to no one’s surprise,
0:17:16 Trump called it a political stunt,
0:17:17 saying it’s too little, too late.
0:17:19 Jess, is there any truth to that?
0:17:21 Should Harris have made this move earlier,
0:17:24 or is this, you know, good campaigning?
0:17:26 I think it’s both.
0:17:29 I think that she has missed numerous opportunities
0:17:32 to be stronger on the border, to appear stronger.
0:17:35 And we can’t change the fact that we’re a visual species.
0:17:39 And seeing somebody at the crisis point
0:17:41 is different than hearing somebody talk about it
0:17:45 in an air conditioned room, in DC or Michigan,
0:17:48 wherever else you might be campaigning.
0:17:50 So I think there are missed opportunities.
0:17:52 I think it is also good policy for her to do it.
0:17:55 And we’re seeing like the latest Quinnipiac poll,
0:17:58 Trump’s advantage on immigration is down to eight points.
0:18:00 So you’re getting closer and closer
0:18:02 to a jump ball on the issue.
0:18:03 And I think that what she has been able to do
0:18:06 is not only emphasize the bipartisan border deal,
0:18:09 which Trump personally destroyed.
0:18:10 Right, he said, “I want a campaign on this.”
0:18:12 And Mitch McConnell said publicly that he did this.
0:18:15 James Langford met Romney.
0:18:19 But she is also offering people a bit of an offer.
0:18:21 And we say, it’s okay to like some of the things
0:18:23 that Trump is supportive of,
0:18:27 but you don’t need to pick Trump in order to get there.
0:18:29 So I will talk to you about more agents.
0:18:32 I will talk to you about more border wall,
0:18:34 something that she used to be very opposed to,
0:18:39 if it means that you will take this kind of more humane approach
0:18:41 to our immigration policy, like tough but humane,
0:18:44 I feel like is the tagline.
0:18:45 What did you think about it?
0:18:47 – I couldn’t decide if it was a good move or a bad move.
0:18:48 I don’t know how many people who believe
0:18:50 she’s been bad on the border
0:18:52 are gonna be swayed by her going down to the border,
0:18:54 or if she’s just bringing attention to an issue
0:18:58 that she’s fairly or unfairly considered weak on.
0:19:00 If I were her, I would just be hammering
0:19:02 around inflation at this point.
0:19:04 I think at the end of the day, I think most people
0:19:05 or a lot of people go into the voting booth
0:19:07 and says, “Who’s gonna put more money in my pockets?”
0:19:08 I’m fed up with government.
0:19:10 I just wanna know who’s gonna keep prices down
0:19:12 and get my salary up, what have you.
0:19:14 And I think his weakest, the soft tissue
0:19:19 or his Achilles heel is a combination of tariffs
0:19:21 and this weird anti-immigration policy
0:19:24 is just gonna absolutely bring inflation roaring back.
0:19:27 I would be doing that 25 hours a day.
0:19:31 And it’s, I don’t know, it just felt to me like,
0:19:32 I saw her down there and I thought
0:19:36 there’s gonna be a lot of eye rolls.
0:19:39 All right, Jess, let’s pivot to something,
0:19:42 I would say it’s less serious, but compelling.
0:19:45 We’re gonna talk about New York City Mayor Eric Adams.
0:19:47 He’s been indicted on federal corruption charges.
0:19:49 The feds are accusing him of taking bribes
0:19:51 from Turkish officials to push through permits
0:19:53 for their consulate, even though the building
0:19:54 didn’t pass inspection.
0:19:57 Plus, he allegedly scored massive discounts
0:20:00 on business class flights to Turkey.
0:20:03 I mean, it’s like, you know, when they say academics,
0:20:05 the reason we’re so vicious with each other
0:20:08 is because there’s so little to fight over.
0:20:09 It’s like, if you’re gonna go down,
0:20:11 you’re gonna go down over business class seats.
0:20:14 Anyways, I’m making light of something.
0:20:16 These are heavy charges ’cause they are in fact
0:20:18 corruption charges.
0:20:20 What is your read on the situation?
0:20:21 – Well, with the amount of buildup,
0:20:24 the number of phones that have been seized
0:20:27 from his top lieutenants, I think it’s up to six people,
0:20:29 six aides that they have their phones
0:20:32 and how long we’ve been talking about this,
0:20:37 I did expect bigger numbers, I guess,
0:20:39 for the scale of corruption.
0:20:41 But clearly the Southern District
0:20:44 wanted to air all of his dirty laundry
0:20:46 because they didn’t have to put everything
0:20:49 in the indictment, it was 56, 57 pages long,
0:20:52 including text messages, note to self,
0:20:54 obviously we’re gonna be doing crimes, don’t text,
0:20:56 like let’s do a crime now with a smiley face,
0:20:58 those kinds of things.
0:21:03 But they definitely wanted, they want him, right?
0:21:07 They think that he is somebody who has been doing this
0:21:09 for a very, very long time.
0:21:14 And I was thinking back to July when the fire chief
0:21:16 randomly resigned.
0:21:19 She’d only been in the job for a couple of years
0:21:22 and she just kind of popped up and was like, I’m out.
0:21:24 And I thought, well, that’s kind of weird, right?
0:21:26 ‘Cause the indictment story had been swirling
0:21:29 and they had been looking into people in Adams’ orbit,
0:21:30 but there was nothing about her.
0:21:33 And now, I mean, maybe it’s not a straight line,
0:21:37 I’m not sure between the Turkish building
0:21:40 that they wanted the fire assessment
0:21:41 to be changed on, right?
0:21:42 That wasn’t up to code.
0:21:46 And this woman saying, I’m tapping out.
0:21:49 But clearly something sinister was going on.
0:21:54 And I think as a New Yorker, what my main focus is,
0:21:57 whether he goes or not, and Huckle is not doing it
0:22:01 as of today, what does the next iteration
0:22:04 of the New York City mayoralty look like?
0:22:07 So if there’s a special election, Cuomo is eyeing that.
0:22:09 So then you’re gonna have someone that a lot of people
0:22:12 see as well as a gangster, but an effective one.
0:22:14 And is that the line now?
0:22:17 Like, we’re okay with corruption
0:22:18 if you’re good at your job,
0:22:20 but when you’re not so good at your job
0:22:23 and you’re corrupt, we’re not having it.
0:22:26 And I’m curious if you were paying attention to this angle.
0:22:29 Adams had spoken out against the Biden administration
0:22:30 for the migrant crisis.
0:22:33 And he gave a very stirring speech where he said,
0:22:35 like, help us out.
0:22:37 You can’t just do this.
0:22:39 You can’t saddle us with billions of dollars
0:22:40 in resources that we have to spend
0:22:43 without giving us the aid that we need
0:22:45 and also stopping this crisis.
0:22:46 It’s not just on the border.
0:22:48 It’s all across the country.
0:22:50 And do you think that that was part of this?
0:22:53 ‘Cause a lot of people do think they’re linked.
0:22:54 – The worst call you can get in the world,
0:22:56 other than obviously something regarding
0:22:57 the health of loved ones,
0:22:59 I think would be from the person
0:23:01 who runs the Southern District.
0:23:05 They’re just so smart and so fucking scary
0:23:07 and so aggressive.
0:23:09 And I think that part of what they do is,
0:23:11 one of the reasons you prosecute people
0:23:14 is obviously justice, that they’ll uphold the law.
0:23:15 But also, I think the Southern District
0:23:17 is really big on sending messages
0:23:19 to people in the finance industry.
0:23:22 They go after, they pick a target
0:23:25 and they’re unafraid, they’re unrelenting.
0:23:28 It’s just a call you don’t wanna get.
0:23:30 But when I read through it,
0:23:33 I quite frankly thought it was pretty underwhelming.
0:23:35 And it takes me to a couple of places.
0:23:40 One, his mistake, taking money from a group
0:23:43 and then using that to influence government actions
0:23:47 that favor them is kinda how the US government works.
0:23:48 For a small amount of money,
0:23:50 you give to a senator, to a representative,
0:23:53 you get access and if you need help
0:23:57 getting something approved, they’re there for you.
0:23:59 It’s always struck me with just a little bit of money
0:24:02 in Washington, how much access you can get.
0:24:04 – Even with foreign influence though,
0:24:06 I feel like that is a line in the hand with this.
0:24:09 – You stole my thunder, you stole my thunder.
0:24:10 – I give it back.
0:24:13 – The problem here is you’re not allowed to do it
0:24:15 from foreign nationals.
0:24:17 That is a bright red line,
0:24:19 especially a place like Turkey
0:24:21 where a lot of people would argue that
0:24:24 they’re not an ally of the US,
0:24:26 even though they weren’t, you wasn’t spying for them
0:24:28 or it wasn’t influencing,
0:24:32 this was fire safety at their consulate.
0:24:35 But nonetheless, you are not supposed to take money
0:24:39 from a foreign nation, much less a foreign nation
0:24:41 that we’re on sort of strange terms with.
0:24:43 So that’s where, quite frankly,
0:24:44 that’s where he really fucked up.
0:24:47 Where it takes me though,
0:24:51 is that this is a guy who grew up son of a single mother.
0:24:54 Never, you know, police chief probably made a good living
0:24:56 but living in Brooklyn probably never had,
0:24:58 you know, a ton of money.
0:25:01 And I think it’s very easy for these officials
0:25:03 to be seduced and start to rationalize.
0:25:07 I’m not excusing it, but I can see how this happens.
0:25:08 Oh, it’s a plane fare.
0:25:11 I get to stay at a nice hotel.
0:25:13 I’m not gonna do anything that damages America, the city,
0:25:16 but oh my God, fire safety, fuck yeah, just get it done,
0:25:18 right, they’re gonna create jobs or whatever,
0:25:20 we wanna be welcoming.
0:25:23 I can see how in his mind, he rationalized this.
0:25:25 And I’m not entirely sure.
0:25:26 When I read about this,
0:25:29 corruption charges Southern District,
0:25:31 I thought it was gonna be a lot worse.
0:25:33 And where I go though,
0:25:36 is that I think we should adopt Singapore’s model.
0:25:38 And that is, I think we should pay our elected officials
0:25:40 a million to $2 million a year
0:25:42 and have much tighter standards.
0:25:45 And just say, look, because the bottom line is,
0:25:46 they don’t make a lot of money.
0:25:50 So I believe the mayor makes around $258,000 a year.
0:25:52 Do you think we should increase the compensation
0:25:53 for our elected representatives?
0:25:55 I’m worried, let me preface this by saying,
0:25:57 I’m worried that the mayor of New York and other places
0:26:01 is basically gonna be these freakishly anomalous,
0:26:03 remarkable people focused on public service
0:26:05 and millionaires and billionaires.
0:26:07 And there’ll be no one in the middle.
0:26:10 – Yeah, I think that this is something that you would get,
0:26:12 you know, one of those 90% approvals for.
0:26:15 And the people who often say that elected officials
0:26:17 are not making enough have their own acts to grind.
0:26:19 And it’s not really about understanding
0:26:22 what the job entails and how important it is.
0:26:26 And I’m always struck by the fact that tons of members
0:26:28 of Congress in DC, they have roommates,
0:26:30 they share apartments.
0:26:32 You know, this is one of the most important jobs
0:26:33 in the country.
0:26:35 And I’m not saying it isn’t fun to have a roomy,
0:26:40 but you should be able to afford your own studio apartment
0:26:44 near Capitol Hill and also be able to afford to get home
0:26:46 to do your constituent work.
0:26:47 And you’re totally right.
0:26:49 Like Dan Goldman is my congressman.
0:26:52 He’s amazing, speaking of, you know, Southern District
0:26:56 prowess, but he’s also the heir to Levi’s fortune, right?
0:26:59 He can afford to be doing this,
0:27:03 whereas a lot of fantastic people can’t
0:27:05 or simply don’t want to because it’s not gonna have
0:27:08 the same kind of remunerative benefits for them, you know,
0:27:10 then going to work at a McKinsey.
0:27:11 – What do you think?
0:27:13 Do you think it’s gonna have to resign over this?
0:27:17 – I’m clear, but he’s definitely not out of the woods on it.
0:27:22 I think a lot will matter what Hockel signals about it.
0:27:24 I mean, she’s the only one who can remove him,
0:27:28 but certainly if she kind of Nancy Pelosi’s him, you know.
0:27:31 – Wouldn’t she just say, wouldn’t she just punt on it
0:27:34 and go let the voters decide in two and a half years
0:27:35 whenever it is, two years?
0:27:37 – Well, the primary thing goes in June.
0:27:39 – Oh, it’s coming up that quickly.
0:27:40 Oh, why would she do that?
0:27:45 – Well, it might be because there’s a corruption level
0:27:47 and we haven’t seen everything that’s to come.
0:27:49 I mean, they see someone else’s phones
0:27:51 even since this came down, but I don’t know,
0:27:53 Kathy Hockel also probably has a vested interest
0:27:57 in keeping Andrew Cuomo away from the mayoral race
0:28:01 and he’s kind of chomping at the bit to get back in there.
0:28:02 So.
0:28:03 – You stole my thunder again.
0:28:05 My prediction was Andrew Cuomo.
0:28:07 So what do you think his prospects would be
0:28:10 for winning mayoral race if for whatever reason,
0:28:13 Mayor Adams decides not to run again in 2025?
0:28:14 – I think they’d be pretty good.
0:28:18 I think that there are people who would feel
0:28:21 like they wanna choose competency
0:28:25 and that if it comes with a side of corruption
0:28:27 and a little bit of kissing
0:28:31 when you didn’t want it, Italian style as he put it,
0:28:34 like what was this defense, I’m just Italian,
0:28:36 that they might be able to look past that
0:28:38 because I think the field will be crowded
0:28:41 with a lot of very progressive people,
0:28:43 like the Scott Stringers of the world.
0:28:47 And I don’t know if that’s where New Yorkers wanna go.
0:28:51 If my Bloomberg is the gold standard for a majority.
0:28:52 I’m not saying there weren’t problems
0:28:53 with the Bloomberg administration
0:28:56 or there aren’t some lefties who didn’t really like him,
0:29:00 but in general, the city was cleaner, it was safer,
0:29:01 it was better run.
0:29:07 And I think that if Cuomo can try to grab that mantle back
0:29:10 that he would have a very viable shot.
0:29:12 And there are also a contingent of people
0:29:15 who just don’t think that he should have had
0:29:19 to leave Albany, that this was kind of trumped up
0:29:22 because of what happened with the nursing home deaths,
0:29:25 which is regrettable, and I wish that he would apologize,
0:29:26 just accept some responsibility.
0:29:29 And people wouldn’t even personally blame him,
0:29:31 say like you killed my grandpa,
0:29:34 but just to say there’s a chain of accountability
0:29:35 for these decisions.
0:29:38 And some of these decisions were not correct.
0:29:40 And I think that he would be in much better position.
0:29:42 (gentle music)
0:29:43 We’ll be right back to hear
0:29:46 from former Maryland governor, Larry Hogan.
0:29:46 Stay with us.
0:29:58 Welcome back, we’re joined by former Maryland governor,
0:30:01 Larry Hogan, a politician who has never been afraid
0:30:04 to buck the party line from leading Maryland
0:30:06 through two terms with bipartisan support
0:30:09 to his current bid for the U.S. Senate.
0:30:11 Hogan has shown a knack
0:30:13 for connecting with voters across the spectrum.
0:30:16 Governor Hogan, welcome to the show.
0:30:17 – Well, thank you very much.
0:30:19 Thanks for having me.
0:30:21 – We’re super excited to have you.
0:30:22 Thank you for joining.
0:30:25 And I paid particular interest to your campaign
0:30:29 as someone who is also not a fan of Donald Trump.
0:30:31 You’ve been a vocal critic and have distanced yourself
0:30:33 from much of the national GOP platform,
0:30:35 including Project 2025.
0:30:37 Just yesterday, you made some news
0:30:39 saying that you won’t be voting for Trump.
0:30:42 You haven’t in the past, but talking about it again.
0:30:44 So how do you see the future of the Republican party
0:30:46 and what role do you think moderates like yourself
0:30:48 are going to be playing in it?
0:30:49 – What a great question.
0:30:53 Yeah, I think I’ve been probably over the last eight years
0:30:57 or so one of the leading outspoken critics
0:30:59 about the direction of the party
0:31:01 and about Donald Trump in particular.
0:31:03 I’ve never been afraid to stand up.
0:31:05 I really didn’t break much news yesterday
0:31:07 because I’ve said over and over and over again.
0:31:10 That’s important, but it’s like every,
0:31:12 once a month, there’s a whole bunch of headlines
0:31:14 that say, “Hogan’s not gonna vote for Trump,”
0:31:16 which is what I’ve said for eight years,
0:31:21 but it’s, look, I’m concerned about the direction
0:31:23 of both parties, quite frankly,
0:31:26 but the Republican party moving off in this direction
0:31:27 of more of a MAGA party.
0:31:31 I’m kind of a traditional, I would say Reagan Republican.
0:31:35 I say I come from the Republican wing of the Republican party
0:31:36 and I want to see us get back
0:31:39 to a more hopeful vision for America
0:31:43 and a party that can appeal broadly to more people
0:31:46 and I want to see us focused on issues and solving problems.
0:31:49 And I know that some people say,
0:31:53 “Well, it seems as if you should just give up on that.”
0:31:55 And I’m just a guy that doesn’t like to give up
0:31:57 and I’ve been successful at winning
0:32:00 and arguably one of the bluest states in America
0:32:02 by convincing independents and Democrats
0:32:04 to cross over and vote for me
0:32:08 because I think most people really just want to see folks
0:32:10 work together and solve problems.
0:32:12 They want to see people reach across the aisle
0:32:15 in a bipartisan way and find common ground
0:32:16 for the common good.
0:32:18 And I’m not sure that we’re seeing a lot of that,
0:32:19 actually out of both parties.
0:32:22 We see a lot of finger pointing and name calling
0:32:26 and people more interested in just saying something outrageous
0:32:31 on cable news or online, in social media.
0:32:36 And I don’t come from the performative art school of politics.
0:32:39 I just want to try to see if we can find a way
0:32:40 to come up with solutions.
0:32:44 – It does feel as if there used to be
0:32:48 a lot of sort of Reagan Republicans in the Senate
0:32:50 and it seems one by one are moderates
0:32:52 who took pride in reaching across the aisle
0:32:55 and more pragmatists and ideologues.
0:32:56 And it feels as if the Republican party
0:32:58 said, “You’re not welcome here.”
0:32:59 It just feels like there’s fewer and fewer.
0:33:02 And I think it’s true on the Democratic side as well.
0:33:04 One, would you agree that it just feels like
0:33:08 there’s no place for moderates to hang their hats anymore?
0:33:11 And if you agree with that, why do you think that’s happened?
0:33:14 – Well, I agree that it’s happening in both parties.
0:33:18 I mean, if you just look at the folks that have left
0:33:20 and let’s focus on the Senate right now,
0:33:23 you have Kirsten Sinema and Joe Manchin
0:33:27 and Mitt Romney all leaving, and we’re,
0:33:30 there’s not a lot of folks kind of in that center,
0:33:33 problem solver, caucus kind of the folks
0:33:35 that were trying to work together across the aisle.
0:33:39 I was co-chairman of No Labels with Joe Lieberman
0:33:42 for three and a half years and our whole focus was on,
0:33:45 how do we find ways to govern from the middle
0:33:46 and get people to talk to one another?
0:33:51 And those three were a big part of the group in the Senate
0:33:54 that was trying to focus on that and now they’re gone.
0:33:59 And so I feel like there’s a huge void in the Senate
0:34:01 for that type of leadership.
0:34:03 And that’s one of the reasons why I stepped up to run.
0:34:07 I mean, I really didn’t need a job
0:34:08 and I wasn’t looking for a title,
0:34:11 but I’m concerned about the direction of the country
0:34:13 and I’m concerned that the Congress continues
0:34:17 to just become more divisive and more dysfunctional.
0:34:22 But whether there’s, I think there’s a huge demand
0:34:24 among the public and I’ve proven that
0:34:27 because I left office last January,
0:34:30 after eight years in a deep blue state
0:34:32 after getting things done over and over and over again
0:34:37 with 70% legislature cutting taxes
0:34:39 and cutting the cost of healthcare
0:34:41 and passing criminal justice reform
0:34:43 with Democrats and Republicans together.
0:34:47 I left office with a 77% job approval
0:34:50 and over 70 with every demographic, 79 with Democrats
0:34:54 and 81 with black voters and young voters and old voters.
0:34:57 So there’s a demand, people do like it
0:35:01 when you talk about common sense solutions
0:35:03 and they do like it when you work across the aisle
0:35:05 and when you have a different tone
0:35:09 and you’re willing to just disagree on the issues
0:35:11 without demeaning the other side.
0:35:13 I think it’s what they desperately want.
0:35:16 However, you’re right, that’s not what we have.
0:35:21 And so it’s, I think the elected leaders
0:35:25 do not really represent where most of the voters are.
0:35:28 40% of the people in America are now independent.
0:35:31 They’re far more than there are Democrats or Republicans
0:35:33 and it’s because they’re getting turned off
0:35:38 by the divisive rhetoric and by the more extreme positions
0:35:42 and they just want us to come together and fix things.
0:35:43 – Yeah, I wanna pick up on that.
0:35:45 So you’re in a competitive race.
0:35:47 I think the real clear politics average is six, seven points.
0:35:51 Lead for Angela also Brooks, who you’re running against.
0:35:54 We know Maryland is a deep blue state.
0:35:57 What issues are you finding are resonating
0:35:58 with your voters most?
0:36:01 And what do you say to people who have anxiety
0:36:04 about electing you who will be part
0:36:06 of the Republican infrastructure?
0:36:08 So let’s say Donald Trump does win
0:36:11 or even if he doesn’t win and majority of the party
0:36:14 has been overtaken kind of by the MAGA wing of things.
0:36:16 How will you serve as a backstop
0:36:19 against some of their more dangerous positions?
0:36:20 – Well, that’s exactly what I hope to do.
0:36:23 And I do have to convince some voters of that
0:36:26 because my opponent’s campaign is basically
0:36:28 just talking about red versus blue.
0:36:30 Like you have to vote Democrat
0:36:35 because I’m going to be somehow empowering the MAGA agenda
0:36:37 when I’ve been one of the leading voices against it.
0:36:40 And I think I can be that key voice in the middle
0:36:42 that’s willing to stand up.
0:36:45 Joe Manchin didn’t empower the far left
0:36:46 of the Democratic Party.
0:36:48 He stopped the crazy things from happening
0:36:52 and worked with Republicans to get things done.
0:36:56 I think, look at John McCain when John McCain called me
0:36:58 before he walked out on the Senate floor
0:37:01 to give the thumbs down on repealing Obamacare
0:37:03 ’cause he and I shared the same position
0:37:06 and I wanted to continue to cover the people in Maryland.
0:37:09 Sometimes one person can make a difference.
0:37:12 And I believe that I have the ability to do that.
0:37:14 I mean, I’m not naive enough to think I can fix everything
0:37:18 but I’m not going there to empower one party or another.
0:37:20 I’m going there to represent all the people of Maryland
0:37:23 and I’m gonna do whatever I think is best for the country.
0:37:26 And I think I’ve proven over and over and over again
0:37:29 that I’m willing to stand up to my party
0:37:31 and to the other party when I think they’re wrong.
0:37:33 I’ve stood up to the former president,
0:37:35 to the current president and I’m not gonna be afraid
0:37:38 to stand up to the next president, whoever that is.
0:37:41 I’ll work with them when I agree with them on an issue
0:37:43 and I’m gonna stand up and stop them when I don’t.
0:37:46 And so the people of Maryland know me,
0:37:49 that there are some, my opponent is saying,
0:37:50 even if you like Larry Hogan
0:37:53 and even if you voted for him twice for governor,
0:37:55 that’s 79% of Democrats that approved of the job
0:37:57 that I’m doing, I’m not winning all of them
0:37:59 because some of them are saying, we really like them.
0:38:01 We wish he was still governor
0:38:03 or we wish he had run for president
0:38:03 but we don’t wanna,
0:38:06 and we’re afraid of all those other Republicans in the Senate
0:38:09 and that’s the campaign we’re having to overcome right now.
0:38:12 And there are Democrats who say,
0:38:14 I wish I could vote for you.
0:38:17 Or they say, convince me that you’re gonna continue
0:38:20 to be the same kind of strong independent leader
0:38:21 that you’ll continue to stand up.
0:38:23 And so when I talk to them one-on-one,
0:38:24 I usually win them over,
0:38:27 but it’s hard to do that in a 30-second commercial
0:38:29 when you’re trying to reach millions of people.
0:38:30 – You sort of read my mind, Governor,
0:38:33 you’re literally out of central casting
0:38:38 for who moderates want more of NDC.
0:38:40 – I just think there’s such a huge base of people
0:38:41 who want somebody,
0:38:43 even if they don’t agree with them on every issue,
0:38:46 they say, this is a reasonable person
0:38:49 that isn’t trying to say inflammatory things
0:38:50 and make personal attacks
0:38:54 that get a ton of viral distribution on TikTok
0:38:57 that then raises a bunch of small dollar money,
0:38:58 never actually pass any laws
0:39:01 ’cause no one wants to deal with them
0:39:02 and wash, rinse and repeat.
0:39:05 It feels like there’s just so much of that in DC
0:39:08 and that we need this solvent called moderates.
0:39:10 At the same time,
0:39:14 I think that there’s probably some real fear
0:39:16 on the Democratic side,
0:39:18 if you say your center left,
0:39:22 that with SCOTUS going so far right
0:39:24 and with the Senate playing such an important role
0:39:26 around approving justices,
0:39:28 specifically I think around issues
0:39:30 including bodily autonomy,
0:39:34 that they’re gonna think, yeah, I really like this guy,
0:39:39 but I can’t risk the Supreme Court going further right
0:39:42 and even less representing people in the middle,
0:39:44 including moderate Republicans.
0:39:47 What would you say to give some of those people comfort?
0:39:49 – Well, yeah, I think people are concerned
0:39:51 about politicizing the court
0:39:54 and most people don’t want it to be politicized
0:39:56 to the right or to the left.
0:39:58 And it seems as if that’s the way we’ve been doing it.
0:39:59 Whoever has the power,
0:40:04 we’re trying to push through the most conservative judge
0:40:05 or the most progressive judge.
0:40:09 And look, I probably have more experience with judges
0:40:11 than most of the people or all the people in the Senate.
0:40:14 I appointed more judges in Maryland
0:40:17 than any governor in history, over 190 judges.
0:40:20 I appointed six out of the seven members
0:40:23 of our Supreme Court in Maryland.
0:40:27 It was the most diverse, most bipartisan judicial selections
0:40:30 in ever in history in our state.
0:40:34 I had all of my Supreme Court justices unanimously confirmed
0:40:37 by all the Republicans and all the Democrats in our Senate.
0:40:39 And it seems as if in Washington now,
0:40:43 we can’t even get one person to cross over,
0:40:46 to cross over and say, this is a qualified person.
0:40:48 I tried to make the best decisions
0:40:50 about did people have the right judicial temperament?
0:40:52 Did they have the right experience?
0:40:54 Were they gonna follow the letter of the law
0:40:56 as opposed to saying we have to have someone
0:40:58 that’ll take this position or that position.
0:41:01 They have to stand up for the left or the right.
0:41:03 I think it’s gotten out of control.
0:41:06 And I think, look, I think we need to make sure
0:41:08 that we have good judges appointed,
0:41:10 whether it’s Kamala Harris is the president
0:41:11 and she appoints a judge that I believe
0:41:13 is a qualified and decent judge.
0:41:15 I’m gonna vote for that judge.
0:41:18 If Donald Trump happens to get elected,
0:41:20 we’ll hope he appoints some decent judges
0:41:21 that I can support there too.
0:41:25 But I just don’t think we ought to continue
0:41:28 to try to jam through or change the rules
0:41:30 or have it swing back and forth every two years
0:41:33 or every four years, depending on who takes over
0:41:36 the House or the Senate or who’s in the White House.
0:41:38 We’re hopelessly divided right now.
0:41:40 And we need, it’s the same thing
0:41:42 on everything else we’re talking about.
0:41:47 We need common sense, compromise in the middle.
0:41:50 Not how do we jam through things on an extreme basis
0:41:51 to the left or the right?
0:41:53 And we need bipartisan buy-in.
0:41:55 We should have judges, we should have people
0:41:58 that senators on both sides of the aisle say,
0:42:01 this person’s obviously qualified to be on the bench.
0:42:03 – So just to double click on that,
0:42:05 based on your success and experience
0:42:07 appointing judges and betting judges,
0:42:09 the three most recent appointments,
0:42:11 Gorsuch, Kavanaugh, Barrett,
0:42:12 do you think the three of them,
0:42:14 had you been in the Senate at that time,
0:42:17 would you have advocated for their approval
0:42:19 and appointment to the Supreme Court?
0:42:21 – Well, I don’t wanna go back and look at past history
0:42:22 about what would have happened.
0:42:25 But I know that I spoke up when I thought,
0:42:27 against Mitch McConnell,
0:42:29 when I thought he was trying to jam through appointments
0:42:31 right before the election.
0:42:34 And I also stood up on Justice Kavanaugh
0:42:38 and said, we ought to have a full hearing of the facts of.
0:42:42 So I wasn’t there in the Senate, didn’t see all of it,
0:42:43 wasn’t part of all the hearings
0:42:45 and didn’t have to be in a position to make those decisions.
0:42:48 But in both cases, I stood up and said,
0:42:49 I stood up to my party.
0:42:51 I’ve stood up to my party when it’s hard.
0:42:54 And I’ll continue to do that.
0:42:57 – I guess Scott led with, people know you, right?
0:42:59 You’ve been around, I’ll figure a long time.
0:43:03 What is something that you wanna communicate
0:43:05 to your potential voters
0:43:06 that you don’t think they know about you
0:43:11 or how you would govern if you were able to win the seat?
0:43:14 – Well, I think that what I’d like to communicate is,
0:43:15 I’m running for the right reasons.
0:43:17 I only stepped up
0:43:19 because I’m very concerned about the country.
0:43:22 I’m concerned about making sure I get my party back on track
0:43:25 that we have a healthy and competitive two-party system.
0:43:26 And I want them to know
0:43:29 that I’m going to be the exact kind of leader
0:43:31 that I was for eight years as governor.
0:43:34 And I think we’ve developed a better track record
0:43:36 than almost anyone in America
0:43:39 for centrist common sense by partisan governing,
0:43:41 by for reaching across the aisle
0:43:44 and that I’m going to be the exact,
0:43:47 it’s a different job that Senator is.
0:43:50 And I know I’ve got to work with 99 other people,
0:43:52 but I’m going to continue to stand up
0:43:53 for whatever I think is right
0:43:55 for the people of my state and for the country.
0:43:58 And I’m not going to be towing the line
0:44:01 or being a rubber stamp for one party or another.
0:44:04 – Are you gonna vote for Kamala?
0:44:05 – No, I’ve said I wasn’t,
0:44:07 neither one of them has really earned my vote,
0:44:10 but I certainly am very pleased
0:44:15 that we have a lot of Harris Hogan split ticket folks
0:44:16 across the state of Maryland.
0:44:17 We currently have about 30% of them.
0:44:22 And interestingly, you’ll see sometimes a Harris
0:44:24 and Hogan yard sign in front of somebody’s house.
0:44:28 So I have to try to earn the support of people
0:44:30 on both sides of the aisle from the right and the left.
0:44:33 And that’s what I’ve always been able to do.
0:44:36 – Yeah, we should point out that polling shows
0:44:38 that a significant percentage of Harris voters
0:44:40 are backing you for the Senate.
0:44:44 And I think that speaks to your reputation as a moderate.
0:44:45 – Well, I need a few more of them.
0:44:46 So we’re still working hard.
0:44:47 – We need more of them?
0:44:50 – Over the next several weeks.
0:44:52 – My sense is that’s why you’re here.
0:44:55 So look, you’ve been in this game a while.
0:44:58 You obviously have really strong political instincts.
0:45:01 Handicap, we’ve been talking about the debate tonight,
0:45:02 the state of the election.
0:45:04 It feels like the polls are almost meaningless noise
0:45:05 at this point.
0:45:07 Any observations or insight you have about
0:45:10 the current state of the race or anything that surprised you
0:45:11 or you think the media is not covering?
0:45:14 – I’m just hoping on the vice presidential debate
0:45:18 that we’ll finally hear some honest discussion of the issues.
0:45:20 I think that’s been lacking in the campaign,
0:45:22 quite frankly, from the presidential candidates
0:45:25 and from the vice presidential candidates.
0:45:28 And I’m hoping it’s not just a food fight
0:45:31 and talking about crazy things,
0:45:33 but we’ll actually hear what each person has to say
0:45:35 about what their positions are.
0:45:38 On the race, I think it’s very close.
0:45:42 Just, I’m not a pundit or a political expert,
0:45:45 but I think the presidential race
0:45:47 is gonna go down to the wire.
0:45:51 And I think that people are really gonna have to get out there
0:45:54 and make their decision and I have no idea
0:45:55 what’s gonna happen in November.
0:45:58 I’m hoping that we’re gonna be able to get in there
0:46:00 and try to make a difference in the Senate.
0:46:04 And I’ll work with whoever is elected president.
0:46:06 I was governor through three presidents
0:46:08 and I worked with President Obama,
0:46:10 with the Trump administration for four years
0:46:11 and then with President Biden.
0:46:14 And whether it’s Donald Trump or Kamala Harris,
0:46:16 I’ll try to work with them when I agree
0:46:18 and help them get things done.
0:46:21 And when I disagree, I don’t think there’s any,
0:46:24 and nobody doubts that I’ll stand up and push back
0:46:28 and do what I think is right.
0:46:30 – Governor, you’re part of a rare species
0:46:31 we hardly see anymore
0:46:34 and we would like to see repopulate the earth.
0:46:36 We really appreciate.
0:46:38 – Well, I thought we were extinct,
0:46:41 but there’s one left, I guess, I’m a unicorn,
0:46:43 but I’m gonna try to find some more people
0:46:44 to come hang out with me.
0:46:45 And I really do believe
0:46:48 that sometimes one person can make a difference.
0:46:51 And there are at least a handful on both sides of the aisle
0:46:52 that kind of agree with me.
0:46:55 Maybe they’re not always speaking out quite as much,
0:46:59 but I’m hoping I can get a centrist caucus
0:47:01 in the United States Senate that’s willing to work together.
0:47:04 – Great, thanks, governor, and stay safe on the trail.
0:47:10 All right, last thing, prediction on tonight.
0:47:13 – Everybody will get to say that their guy won
0:47:17 and that it matters more for the democratic side,
0:47:19 that we need this more for walls
0:47:20 than we do necessarily for vans
0:47:25 who will continue to be reviled to some degree.
0:47:27 Yup.
0:47:30 – I’m gonna punt and just read funny jokes about Tim Walls.
0:47:32 My real concern with Governor Tim Walls
0:47:33 is that he seems like the kind of guy
0:47:35 if you leave your car unlocked in the summer,
0:47:38 he’s going to leave you six zucchini’s on your front seat.
0:47:40 That was pretty good.
0:47:42 Walls has the vibes of a man who makes short helpful videos
0:47:45 on how to fix garbage disposals in his spare time,
0:47:47 like that one.
0:47:49 Last one, Tim Walls is the kind of guy
0:47:51 who tells you to watch for deer
0:47:54 and call us when you get home before you depart his house.
0:47:55 Like that one, that’s my favorite.
0:47:57 – I love that guy.
0:47:59 Like the guy who’s like cares if you got home.
0:48:01 – One more, Tim Walls 1000% says,
0:48:05 “What’s the damage when the waiter hands him the check?”
0:48:06 I like that one too.
0:48:07 – Yeah.
0:48:08 – Okay, good stuff.
0:48:09 – Very cute.
0:48:10 – That’s all for this episode.
0:48:12 Thank you for listening to Raging Moderates,
0:48:15 our producers are Caroline Shagren and David Toledo,
0:48:17 our technical producers, Drew Burroughs.
0:48:18 You can find Raging Moderates
0:48:21 on the Prop G pod every Tuesday.
0:48:22 Please subscribe.
0:48:23 Right now we’re in the Prop G feed,
0:48:25 but soon we’re gonna be going to our own feed.
0:48:28 So please subscribe and download.
0:48:31 (upbeat music)
0:48:33 (upbeat music)
0:48:36 (upbeat music)
0:48:39 (upbeat music)

0:00:01 [MUSIC PLAYING]
0:00:03 Support for ProfG comes from 8Sleep.
0:00:06 8Sleep is revolutionizing the way we sleep with their innovative sleep
0:00:08 technology known as the Pod.
0:00:11 They’ve just launched the newest generation of the Pod, Pod 4 Ultra,
0:00:14 which can cool down each side of the bed by 20 degrees
0:00:15 fair and high below room temperature,
0:00:18 keeping you and your partner cool during the hottest nights.
0:00:21 And the best part, it’s easy to add to any bed.
0:00:24 Just add the Pod to your current mattress like a fitted sheet.
0:00:27 Go to 8sleep.com/profg and use code “profg”
0:00:30 to get $350 off Pod 4 Ultra.
0:00:32 Currently, it ships to the United States, Canada, United
0:00:34 Kingdom, Europe, and Australia.
0:00:40 There’s over 500,000 small businesses in BC
0:00:42 and no two are alike.
0:00:43 I’m a carpenter.
0:00:44 I’m a graphic designer.
0:00:46 I sell dog socks online.
0:00:50 That’s why BCAA created one size doesn’t fit all insurance.
0:00:53 It’s customizable based on your unique needs.
0:00:56 So whether you manage rental properties or paint pet portraits,
0:00:59 you can protect your small business with BC’s most
0:01:01 trusted insurance brand.
0:01:05 Visit bcaa.com/smallbusiness and use promo code radio
0:01:06 to receive $50 off.
0:01:09 Conditions apply.
0:01:13 Hey, I’m John Glenn Hill, host of a brand new show from Vox
0:01:14 called Explain It to Me.
0:01:18 This week, the ethical murkiness of zoos.
0:01:20 Do we as humans feel like we deserve
0:01:23 to just be able to walk around and see these animals?
0:01:25 Like, maybe we don’t deserve that.
0:01:28 Maybe there’s just some animals we don’t get to see.
0:01:30 To zoo or not to zoo?
0:01:33 That’s this week on Explain It to Me.
0:01:35 Listen wherever you get your podcasts.
0:01:42 Today’s number, 6.5 million.
0:01:44 That’s how many leaders of beer festival attendees consumed
0:01:47 at Munich’s Oktoberfest in 2023.
0:01:50 Ed, I didn’t know if you know this, but my wife is German.
0:01:52 And I have her rank me on a scale of 1 to 10
0:01:53 whenever we have sex.
0:01:55 And the other night when I tried anal,
0:01:56 I said nine, nine.
0:01:58 So Ed, I think I’m improving.
0:02:12 Ed, I just ask play never gets old for me.
0:02:14 It never gets old.
0:02:15 Yeah, I could tell.
0:02:16 It’s my go-to.
0:02:18 It’s my go-to.
0:02:20 Yep, could tell that too.
0:02:22 You are in Germany right now.
0:02:23 You’re in Munich. How’s it going?
0:02:24 Good segue, Ed.
0:02:24 Yep, you’re welcome.
0:02:28 I am in Munich and I’m staring out the window here
0:02:30 at the Hasenplatz, I don’t know if I know what it’s called,
0:02:31 Masterplatz.
0:02:36 Anyways, and there’s a giant Ukrainian flag
0:02:38 and a giant Israeli flag.
0:02:39 I absolutely love Germany.
0:02:41 I think Germany is one of the more progressive
0:02:42 like shit-together countries.
0:02:44 If I spoke German, I would live in Munich.
0:02:45 I absolutely love it here.
0:02:49 I think it’s a wonderful society, fantastic football,
0:02:50 very progressive.
0:02:52 They know how to make amazing cars.
0:02:53 They work hard, they party hard.
0:02:54 I love it here.
0:02:56 Have you spent much time in Germany, Ed?
0:02:58 I was in Germany with you that one time.
0:02:59 Oh yes, I’ll never forget it.
0:03:00 When was that?
0:03:03 You and I and our team went to Munich for DLD.
0:03:05 Oh, that’s right, DLD.
0:03:09 And we went out and we parted in the basement of the,
0:03:10 what was that hotel called?
0:03:12 The Bayerische Hof, for whatever it’s called.
0:03:13 Bayerische. Bayerische Hof.
0:03:15 Hof, yeah, that’s right.
0:03:17 So yeah, no, I love Munich too,
0:03:19 but importantly, are you going to be able
0:03:21 to experience Oktoberfest?
0:03:22 I’m going to attend tonight
0:03:23 if I get no mercy, no malice done.
0:03:25 But yeah, I’ll probably go for tonight.
0:03:27 I’m not a huge Oktoberfest fan.
0:03:28 Why do I not really believe you?
0:03:30 Well, I don’t, here’s the thing.
0:03:31 I don’t look good in shorts.
0:03:32 You need to wear a kilt.
0:03:32 You look good in a kilt.
0:03:34 Yeah, I could do that.
0:03:36 Except my kilt, I have the big black kilt.
0:03:37 It’s really hard to travel with.
0:03:38 It’s giant.
0:03:41 It’s like, it’s literally like traveling with drapes.
0:03:42 It takes its own suitcase.
0:03:43 Anyways, enough of this shit.
0:03:44 Get to the headlines, Ed.
0:03:45 Stop stalling.
0:03:49 Nine, nine, stop stalling.
0:03:51 Let’s start with our weekly review of Market Vitals.
0:04:01 The S&P 500 rose, the dollar was flat, Bitcoin climbed,
0:04:04 and the yield on 10 year treasuries increased.
0:04:05 Shifting to the headlines.
0:04:08 The Justice Department is suing Visa for allegedly
0:04:10 monopolizing the debit card market.
0:04:13 Officials say Visa used various anti-competitive practices,
0:04:16 including paying competitors to stay out of the market.
0:04:19 The complaint marks the Biden administration’s first major
0:04:22 antitrust case in the financial services industry.
0:04:25 Meta unveiled a new prototype of augmented reality glasses
0:04:28 at the MetaConnect conference.
0:04:31 The new product, Orion, will use eye tracking and a wristband
0:04:34 to help users navigate apps with movements.
0:04:37 And finally, OpenAI’s chief technology officer,
0:04:40 Mira Murati, along with multiple other executives,
0:04:41 has resigned.
0:04:44 The exits come as OpenAI considers transitioning
0:04:48 to a for-profit company and giving CEO Sam Altman
0:04:50 a 7% equity stake.
0:04:53 Scott, your thoughts starting with this new complaint
0:04:54 from the DOJ.
0:04:56 So I’ve never met a breakup I didn’t like.
0:04:58 And my sense is it’s impossible.
0:04:59 There’s a general cadence here.
0:05:02 And that is, in most societies, what happens
0:05:05 is there’s a group of talented, hardworking, and lucky people
0:05:07 who get very successful and very wealthy.
0:05:10 And they can’t help but unwittingly.
0:05:12 And there’s nothing malicious here,
0:05:15 but they start becoming close to government officials.
0:05:18 And effectively, the same thing happens with corporations.
0:05:21 And that is one gets is so good and so talented.
0:05:24 And they get, as a result of that success,
0:05:26 are able to attract cheaper and cheaper capital
0:05:28 that other people just can’t compete with.
0:05:31 And they can overinvest and kind of run away with it.
0:05:35 And people will argue, well, OK, but the icons of yesterday
0:05:37 never survive.
0:05:39 But along the way, they can do a lot of damage
0:05:40 and squelch innovation.
0:05:43 When AT&T was broken up, we found out
0:05:45 there was cell, fiber, data analytics all trapped
0:05:47 at AT&T Bell Labs, so they didn’t want to compete
0:05:50 with their very lucrative, long-distance business.
0:05:53 So I generally find that by the time something ends up
0:05:57 on the FTC or the DOJ’s radar, it’s oftentimes
0:05:59 more too late than too early.
0:06:01 So the fact that they’re paying people
0:06:05 not to compete with them, right, using predator pricing
0:06:07 and then basically paying people to be the default card
0:06:12 and playing real hardball, that this is probably,
0:06:14 you know, probably a good example
0:06:17 of something pretty boring that has gone
0:06:19 flowing under the radar for a while.
0:06:20 What are your thoughts?
0:06:21 You know, when you look at the complaint,
0:06:25 they’re sort of saying that Visa is just ubiquitous
0:06:26 in debit card processing.
0:06:31 They control 60% of the debit transaction market.
0:06:32 And as you point out, they’re sort of,
0:06:35 they’re using these partnerships that they have
0:06:38 with financial institutions to box out competitors.
0:06:41 Now, just one side note.
0:06:44 They say that they’re boxing out young companies
0:06:46 and startups, but who they’re really boxing out
0:06:48 is PayPal and Apple.
0:06:50 I mean, these are not really small companies.
0:06:51 These are huge companies.
0:06:54 And I get the complaint, but I’m sort of like,
0:06:57 well, what else is Visa supposed to do?
0:07:00 Because, you know, when you’re a payments processor,
0:07:04 there isn’t really much you can do to innovate in that space
0:07:07 other than maybe bringing down prices,
0:07:08 which they are already doing.
0:07:11 Their prices are actually very low.
0:07:14 And if you want to maintain, you know, growth,
0:07:16 and if you want to maintain market share,
0:07:18 you know, yeah, you want to maintain your partnerships.
0:07:20 And maybe that means paying them more
0:07:21 and trying to box out your competitors.
0:07:24 And it feels like what’s happening with Visa
0:07:27 is exactly what has happened in the utility industry.
0:07:29 And that is, you know, once upon a time,
0:07:31 there were these electrical companies
0:07:33 and these water companies and telecom companies
0:07:36 that they were all, you know, considered normal products.
0:07:39 And eventually they developed into these natural monopolies.
0:07:41 And at a certain point, the government was like,
0:07:43 okay, this is a utility now.
0:07:45 This is a different type of product.
0:07:47 And we’re going to regulate it differently.
0:07:50 And so what I’m seeing here with the payments processing
0:07:52 is I feel like at this point,
0:07:55 processing debit cards and credit card transactions
0:07:57 is essentially a utility.
0:07:59 It’s the same as telecom.
0:08:03 It’s the same as water services.
0:08:06 And it feels like that’s how we should be treating it
0:08:08 from a regulatory standpoint.
0:08:10 It feels like we should be considering it
0:08:13 an essential part of societal infrastructure.
0:08:15 And we should start regulating this
0:08:17 as if it were a utility.
0:08:18 – I think it’s a really solid argument.
0:08:23 And that is being a monopoly isn’t in and among itself illegal.
0:08:25 ‘Cause in some instances like,
0:08:28 it doesn’t make sense to have two power companies in Orlando.
0:08:29 Because it’s very expensive.
0:08:30 The infrastructure is very expensive.
0:08:33 It makes sense to have one company providing the power
0:08:35 or generating the power.
0:08:37 And there might be good arguments for why
0:08:39 this is a business to scale payment processing
0:08:41 and the investments, requisite investments you need to make
0:08:45 in security, in liquidity and maybe scale,
0:08:46 lets you bring your prices down.
0:08:49 I think you’re making a solid argument.
0:08:52 However, I think most retailers would say,
0:08:54 we have to carry Visa, we have no choice.
0:08:55 We just have no choice.
0:08:58 And we’d like alternative options,
0:09:02 but these guys show up and we have to, as a merchant,
0:09:03 we have to work with Visa,
0:09:06 which gives them too much pricing power.
0:09:08 In addition, you mentioned something, you said, okay,
0:09:10 say in fact that scale does have its benefits
0:09:13 and they can show that as they grow bigger and bigger,
0:09:16 the third party merchants and consumers both benefit
0:09:18 through lower fees, okay, fine.
0:09:20 But use the word utility.
0:09:23 And utilities have a government official regulating them
0:09:26 and actually providing input and supervising their strategy
0:09:29 and their price increases or decreases, right?
0:09:31 ‘Cause they can have all of a sudden the utility
0:09:34 that’s given government approval to basically
0:09:36 be the only power supplier, say, you know,
0:09:38 we’re gonna raise rates 8% a year
0:09:40 when inflation is going up 2% a year.
0:09:43 So this is an interesting one.
0:09:45 I think your points are valid.
0:09:46 Curious though, what credit card do you care?
0:09:48 What does Ed Elson pay with?
0:09:49 ‘Cause your payment system,
0:09:52 there are certain brands that are self-expressive benefit.
0:09:56 Your shoes, your watch, the university you went to,
0:09:57 the company you work for,
0:10:00 like if you work for a cool podcasting company,
0:10:03 you finally get a girlfriend is what I’ve heard.
0:10:06 But what is the credit card you use
0:10:08 and does in your mind or payment system,
0:10:11 does it have any sort of self-expressive benefit for you?
0:10:13 – I use AmEx and the answer is absolutely yes.
0:10:15 – Do you have a green card, a platinum card?
0:10:16 What do you have?
0:10:16 – Platinum baby.
0:10:17 – Oh, you’re platinum.
0:10:19 And do you use it for signaling
0:10:20 or do you use it because of the benefits?
0:10:22 ‘Cause it costs what, three or 500 bucks a year?
0:10:25 – It really is all signaling to me when I think about it.
0:10:28 I mean, I don’t care that much about the benefits.
0:10:29 I really think that it’s,
0:10:31 I think these benefits and I think this signaling
0:10:33 is kind of the greatest scam in history.
0:10:34 I mean, it really is.
0:10:36 I like that it’s made of metal
0:10:39 and I like that it looks cool and I like what it says.
0:10:42 So, I mean, just to be completely transparent with you,
0:10:45 I think it’s pretty much all signaling for me.
0:10:48 But I know that it is the same for you, right?
0:10:50 – Well, I was gonna say what you just said
0:10:53 is really pathetic, but if you wanna,
0:10:55 if you wanna understand really, really pathetic,
0:10:58 like Uber pathetic, imagine taking your platinum card,
0:11:01 literally to spray painting at black
0:11:04 and then charging dudes $5,000 a year.
0:11:07 And I have paid that, I figured it out.
0:11:09 If I had taken all the money I’d spent
0:11:11 for the pleasure of owning a platinum card
0:11:13 that’s been sprayed, painted black
0:11:15 and invested it in the S&P,
0:11:18 I think I’d have like $1.3 million.
0:11:21 So my friend, we all, a bunch of us young entrepreneurs
0:11:24 back in the ’90s used to get together
0:11:26 and we go out to dinner.
0:11:27 And I remember once my buddy Greg Shove
0:11:29 was working at AOL, he was a big cheese at AOL,
0:11:31 he goes, “Ah, it’s my turn, I got this.”
0:11:33 You know, we were all trying to signal to each other
0:11:34 where it was like fighting for the bill,
0:11:36 like not because we were generous or nice,
0:11:38 but because we wanted to pretend we were ballers.
0:11:40 And he threw his credit card out
0:11:44 and it hit like a fucking wrench and went gunk, gunk, gunk.
0:11:49 And it was this weird titanium black thing
0:11:51 and we’re all like, “What the fuck?”
0:11:53 And we pick it up and we’re all passing it around
0:11:54 and the thing was impossible to break.
0:11:56 It was like a weapon.
0:11:58 And it was an AMIC centurion card.
0:12:00 And I’m like, “Oh my God.”
0:12:03 Anyway, so I called him and I said,
0:12:05 “My name’s Scott Gallo, I’m kind of a big deal.
0:12:07 I’ve heard about this thing called the centurion card.
0:12:09 I’d really like to apply for one.”
0:12:10 And this is what they said.
0:12:11 They said, “Hold on a moment.”
0:12:13 They transferred me and the person came on,
0:12:13 I said the same thing.
0:12:15 And the person said, “I love this.”
0:12:17 They said, “Sir, we value your business,
0:12:20 but we can neither confirm nor deny the existence
0:12:21 of so-called black card.”
0:12:26 And I’m like, “Oh my God, I must have one of these things.”
0:12:29 So I went on, I did some research before there were blogs
0:12:32 and I found out all you need to do to get a black card,
0:12:34 there’s no status in it.
0:12:39 You have to spend $250,000 on any one American express account
0:12:43 and if you spend $250,000 in a calendar year,
0:12:48 the person whose card that is gets an invitation to centurion.
0:12:50 So I was running profit at the time
0:12:54 and I forced everybody to, if you went to fucking Chipotle
0:12:57 and didn’t use my gold card, which was just so ridiculous.
0:12:58 You want to talk about cheesy?
0:13:01 Gold card, what the hell does a gold card mean?
0:13:05 Anyways, so finally it came and it was beautiful.
0:13:08 And my assistant, I was on vacation.
0:13:10 She opened everything and she threw it out.
0:13:11 I’m not exaggerating.
0:13:14 I called them and said, “Send me the goddamn invitation again.”
0:13:16 They denied it even existed.
0:13:18 I went down to the trash looking for that thing.
0:13:20 I dug through the trash looking for my invitation
0:13:22 to centurion card.
0:13:26 Anyways, finally got one and I’ve had it for,
0:13:29 gosh, I guess about 27 years now.
0:13:31 And I find that it was good in two situations.
0:13:34 One, if you’re recruiting somebody,
0:13:35 I thought it was powerful
0:13:37 ’cause a young person is impressed by that stuff.
0:13:38 And if you’re paying for lunch,
0:13:40 they see you have a black card.
0:13:42 It kind of says, okay, the guy I might be coming to work for
0:13:45 has his shit together and also quite frankly, for mating.
0:13:47 Any high margin product,
0:13:50 any high margin product is signaling.
0:13:52 We were talking about universities, Ferraris,
0:13:55 anything that has more than 60 or 70 points of gross margin
0:13:58 is meant to make you more attractive to the other sex.
0:14:02 It’s either software or it’s meant to make you more attractive
0:14:04 to the other sex or make you feel closer to God.
0:14:06 A lot of beautiful artisanship
0:14:09 has been sequestered to religious institutions.
0:14:11 So it’s been hardwired into our psyche that if you
0:14:15 hear beautiful music and smell candles
0:14:16 and see the most beautiful frescoes on the ceiling
0:14:19 that there’s a decent chance, God hangs out there.
0:14:21 And so when you see the slope on the back of a 911
0:14:23 or the mesh of a Patego Veneta bag,
0:14:25 I do think it steals you and makes you feel
0:14:28 like you’re in the presence of something supernatural.
0:14:29 Anyways, what’s our next story here, Ed?
0:14:33 – Let’s get your reactions to the new meta AR glasses,
0:14:34 the meta Orion.
0:14:35 What do you think of that?
0:14:36 – Look, let me go this way.
0:14:38 They came out with a product.
0:14:39 I think that’s 250 bucks.
0:14:44 So it’s a 10th of the price of the mixed reality headset.
0:14:48 I think if you go meta on this, if you will,
0:14:50 it goes all goes back to Mark Zuckerberg
0:14:51 figured out about eight years ago,
0:14:55 he was always gonna be Cinder Prashai or Tim Cook’s bitch,
0:14:58 as long as they controlled the vertical interface
0:15:00 via the phone with the end consumer,
0:15:02 that he was always subject to someone else’s
0:15:06 blood sugar level if he didn’t control the end device.
0:15:07 And so they’ve tried a lot of things.
0:15:10 They tried the portal, they’ve tried a phone,
0:15:12 they’re trying to figure out a way to go direct to consumer
0:15:14 and go vertical and control the distribution.
0:15:16 And typically a brand once against above
0:15:19 a certain dollar volume starts opening its own store
0:15:23 so it can take greater command or control of its own destiny
0:15:25 through vertical distribution.
0:15:29 And Zuck’s been trying to do this for a long time
0:15:30 and has burned tens of billions of dollars
0:15:33 trying to establish the headset is vertical distribution.
0:15:36 This probably will at some point succeed
0:15:37 once it gets to the point.
0:15:39 I think they were smart to partner with Ray-Ban,
0:15:42 but once they get to the point in probably five to 10 years
0:15:44 where the cameras are sophisticated enough
0:15:46 and the microprocessors are powerful and smart enough
0:15:49 to be elegantly seemed into your glasses
0:15:51 or your sunglasses, fine.
0:15:55 This is gonna put the mixed reality set,
0:15:56 I think, pretty much out of business.
0:15:59 It’s 60 or 70% as good as the mixed reality headset
0:16:02 from Apple and it’s 10% of the price.
0:16:06 On a product value relative to the Apple headset,
0:16:08 it’s just a superior offering.
0:16:09 What are your thoughts, Ed?
0:16:11 – I think Mark Zuckerberg’s been listening to you.
0:16:16 I mean, I think you said that VR headsets were stupid
0:16:18 because they’re too uncomfortable
0:16:20 and they make you look stupid.
0:16:21 They make you look uncool.
0:16:23 And so this is his response.
0:16:27 Has he come out with a headset that isn’t uncomfortable?
0:16:30 It weighs six times lighter than the Vision Pro.
0:16:33 It’s 100 grams and that was actually one of the first things
0:16:36 that Mark Zuckerberg said about it at the event.
0:16:39 And also it looks cool-ish.
0:16:43 It passes as perhaps a style statement.
0:16:45 Now, I don’t think it looks cool enough
0:16:47 where people are actually gonna wear it,
0:16:50 but credit to Zuckerberg because the best thing he said
0:16:53 at this event in my view was, quote,
0:16:56 the right way to look at Orion is a time machine.
0:16:58 These glasses exist, they are awesome,
0:17:00 and they are a glimpse of a future
0:17:02 that is going to be pretty exciting.
0:17:04 In other words, I think what he’s saying is,
0:17:06 this isn’t the product that’s gonna change things.
0:17:09 This isn’t gonna affect our business materially,
0:17:13 but what it does do is it sends a message to Apple,
0:17:15 to Microsoft, and to Wall Street
0:17:18 that augmented reality is coming
0:17:20 and do not get it twisted.
0:17:22 Matter is going to be a leader in that space.
0:17:25 And it was reflected in the stock movement.
0:17:28 The stock increased right after the event.
0:17:31 So I think Mark Zuckerberg is kind of crushing it right now.
0:17:35 He seems rational in a way that he hasn’t been before.
0:17:40 He seems relatable and weirdly cool in a lot of ways.
0:17:42 And you look at his favorability scores,
0:17:44 especially among people my age,
0:17:46 it has skyrocketed in the past year,
0:17:48 and it all happened after he started getting
0:17:51 into gold chains and T-shirts
0:17:53 and going on podcasts and talking about jiu-jitsu.
0:17:56 So he has committed what I think is probably
0:17:58 the best rebrand of the decade so far.
0:18:01 Let’s just wrap up here on the headlines
0:18:04 with what’s going on with open AI.
0:18:08 Mira Murati has just resigned.
0:18:10 And I just want to go through the timeline
0:18:13 of the open AI management team here,
0:18:14 ’cause it’s very strange.
0:18:16 I mean, you’ll remember a year ago,
0:18:19 Sam Altman was fired, and then he was promptly rehired.
0:18:23 And soon after that, the president, Greg Brockman, resigned.
0:18:25 And later, the chief scientist
0:18:28 and co-founder, Ilias Satskeva, resigned.
0:18:31 And then in August, another co-founder, John Shulman left,
0:18:33 and he went to go to Anthropic.
0:18:35 And now the CTO has resigned.
0:18:40 So my question for you, why is everyone leaving open AI?
0:18:42 – I don’t think they’re doing it voluntarily.
0:18:44 There’s that saying, if you stab the prince,
0:18:45 you better kill him.
0:18:47 I mean, essentially these people were either directly
0:18:50 or indirectly involved in his ouster
0:18:54 where they didn’t kill him, where Sachin Adela said,
0:18:56 “Okay, that’s really adorable and cute guys,
0:18:58 “but he’s going back on the board
0:19:00 “and he’s gonna be the CEO.”
0:19:02 And I think they were all on the green mile.
0:19:03 And I don’t know what her role is in it,
0:19:06 but basically, my guess is they said,
0:19:08 “Look, we’re gonna let things calm down,
0:19:11 “and then I’m gonna bring in my folks.”
0:19:14 I think they’re also about to give them 7% of the company,
0:19:17 which will be worth, according to the most recent valuation,
0:19:19 around $10 billion.
0:19:20 So he’s sort of, I think we’re in the trust
0:19:22 and the credibility of the marketplace.
0:19:24 He really is kind of the Bill Gates
0:19:28 or the Steve Jobs of this generation.
0:19:29 And I think he gets to do what he wants.
0:19:32 And I think with the equity he has at his disposal
0:19:34 and the money he has at his disposal,
0:19:36 he just wants to bring in his own team.
0:19:40 And my guess is the past few years have been very exhausting
0:19:42 or trying for a lot of these people
0:19:43 and they all want to go do their own thing or,
0:19:47 I don’t know, but I would bet once he returned,
0:19:49 senior management, sorry guys,
0:19:51 you tried to kill me and you didn’t,
0:19:53 you’re on the green mile.
0:19:53 – From my understanding,
0:19:57 the mirror was one of his advocates.
0:19:58 Does that change your view?
0:20:01 – I don’t know, but initially when this company started,
0:20:04 had sort of this crunchy granola AI to save the whales
0:20:07 and it was meant initially to be a think tank
0:20:09 to try and provide a check and research
0:20:12 about the dangers of AI in a trolling society.
0:20:14 When they figured out there were tens or hundreds
0:20:16 of billions involved, they all decided,
0:20:19 well, yeah, let’s save the dolphins on weekends.
0:20:21 This is an opportunity for all of us to get our golf streams
0:20:24 and it’s quickly pivoted to being a for-profit.
0:20:26 And my guess is a lot of the senior managers
0:20:29 who are probably are going to reap tens of millions,
0:20:30 maybe even hundreds of millions of dollars
0:20:31 from their time there and their tenure there
0:20:33 and their stock options.
0:20:35 For those of them that think, you know,
0:20:35 I just don’t want to be around
0:20:37 for the next evolution of this.
0:20:37 I don’t know if there,
0:20:39 I would guess that it’s a combination of them
0:20:41 being forced out or saying like,
0:20:43 it’s time for you to go on.
0:20:44 I want to bring in my own crew
0:20:47 that’s not going to stand by and let a coup happen.
0:20:50 I don’t know what a role was or wasn’t in this,
0:20:51 but it’s not shocking to me
0:20:54 that he’s totally changing over the management team.
0:20:56 When you have that kind of capital
0:20:57 and that kind of equity
0:20:58 and that kind of brand equity,
0:21:01 and I just did an AMA at section.
0:21:04 And one of the questions was,
0:21:06 I have an offer to go run AI
0:21:09 at a Fortune 500 company that’s not that prestigious,
0:21:12 or I can take a much more junior role at open AI.
0:21:15 And I’m like, oh, go to open AI.
0:21:17 When there’s a rocket ship taking off,
0:21:18 even if you have a shitty seat in economy,
0:21:20 you get on the rocket ship.
0:21:22 And you’ll be branded for the rest of your life
0:21:25 as someone who worked at open AI in the fairly early days,
0:21:29 which is like getting an MBA from Wharton or Stanford.
0:21:32 So I don’t think this is going to have any impact
0:21:32 on the company.
0:21:33 I think they just have so much momentum.
0:21:36 I think he’s such an outstanding leader.
0:21:38 And the fact that they’re able to raise money
0:21:40 at 150 billion means they’re just going to have
0:21:42 all the capital they need to kind of
0:21:44 keep on trucking, so to speak.
0:21:46 – And the headlines were just a callback
0:21:47 to a prediction that we made.
0:21:51 People might remember he was saying over and over,
0:21:53 he has no financial stake in open AI.
0:21:55 It’s a not-for-profit company, et cetera, et cetera.
0:21:57 And our prediction was pretty simple.
0:21:59 There is no way he isn’t going to make out
0:22:02 with a shit ton of cash from this operation.
0:22:05 – This is the easiest prediction ever.
0:22:08 Sam Altman, directly or indirectly,
0:22:11 is going to make billions of dollars from open AI.
0:22:16 – So yeah, he got rich off open AI and shocker.
0:22:19 – Yeah, do I remember that Senator,
0:22:21 well, Senator Kennedy from Louisiana,
0:22:22 I don’t have any equity.
0:22:24 – You make a lot of money, do you?
0:22:27 – I make, no, I paid enough for health insurance.
0:22:28 I have no equity in open AI.
0:22:29 – You really?
0:22:29 That’s interesting.
0:22:30 You need a lawyer.
0:22:31 – I need a what?
0:22:33 – You need a lawyer or an agent?
0:22:35 – I’m doing this ’cause I love it.
0:22:36 – I’m only interested in saving the world.
0:22:37 Don’t regulate us.
0:22:38 There’s no need to.
0:22:40 I don’t like money.
0:22:41 I don’t like, yeah, uh-huh.
0:22:44 – We’ll be right back after the break
0:22:45 with a look at Palantir.
0:22:48 (gentle music)
0:22:56 Support for the show comes from Fundrise.
0:22:58 Venture Capital is widely seen
0:23:00 as one of the most lucrative asset classes in the world.
0:23:02 Go look at the S&P 500.
0:23:04 Nearly every major tech company on that list
0:23:07 was once founded by venture capital firms,
0:23:10 producing billions of dollars in profits in the process.
0:23:13 The hard truth, however, is that the biggest venture funds
0:23:15 are almost entirely funded by institutional investors
0:23:17 like endowments and sovereign wealth funds.
0:23:20 So unless you knew a guy who knew a guy,
0:23:22 you and 99.9% of individual investors
0:23:25 did not get to participate in the pre-IPO growth
0:23:27 of any of those blue chip companies.
0:23:28 And it’s happening again.
0:23:30 Look at the biggest names in AI.
0:23:33 For instance, almost all of them are still private,
0:23:35 just out of reach of your portfolio.
0:23:38 The Fundrise Innovation Fund is finally changing that.
0:23:41 It’s a more than $125 million fund.
0:23:44 It holds some of the most exciting pre-IPO tech companies
0:23:46 in the world, and it’s designed specifically
0:23:47 for individual investors.
0:23:51 This time, you can get it early at fundrise.com/markets.
0:23:56 That’s F-U-N-D-R-I-S-C.com/markets.
0:23:58 Carefully consider the investment material
0:24:00 with foreign investing, including objectives, risk,
0:24:01 charges, and expenses.
0:24:03 This and other information can be found
0:24:04 in the Innovation Funds Prospectus
0:24:07 at fundrise.com/innovation.
0:24:09 This is a paid advertisement.
0:24:13 Support for the show comes from Aidsleep.
0:24:14 Do you ever wonder how people
0:24:15 in Silicon Valley sleep at night?
0:24:17 Well, apparently very well,
0:24:20 on some of the most innovative sleep technology out there.
0:24:22 Aidsleep is revolutionizing the way we sleep
0:24:23 with what they call the pod.
0:24:26 You can add the pod to your current mattress
0:24:28 like a fitted sheet to automatically cool down
0:24:30 or warm up each side of your bed.
0:24:32 They’ve just launched the newest generation of the pod,
0:24:34 the Pod 4 Ultra.
0:24:35 It can cool down each side of the bed
0:24:38 by 20 degrees Fahrenheit below room temperature.
0:24:40 It can also track your sleep time, sleep phases,
0:24:42 heart rate, and even your snoring.
0:24:45 And you know who’s gotten to try out the new pod?
0:24:46 What do you think, Ed?
0:24:47 Tell us about your experience with the pod.
0:24:51 I love it, Scott.
0:24:51 It’s great.
0:24:54 It tracks my sleep, my heart rate,
0:24:57 and the best part is that it cools down my bed for me,
0:24:58 which is awesome.
0:25:02 It’s a great little addition to your nighttime routine.
0:25:06 Go to aidsleep.com/propg to use code “propg”
0:25:10 to get get this $350 off your Pod 4 Ultra.
0:25:12 It currently shifts to United States, Canada,
0:25:14 United Kingdom, Europe, and Australia.
0:25:21 Support for Prop G comes from Nerd Wallet.
0:25:23 If you’re a listener of the show, you know business,
0:25:25 and if you’re looking for a resource
0:25:27 to find financial products that can help you
0:25:28 make smart financial decisions,
0:25:30 turn to the nerds at Nerd Wallet.
0:25:33 Not only have they spent thousands of hours researching
0:25:36 and reviewing over 1,300 financial products,
0:25:38 but they have the tools you need to make smarter decisions.
0:25:40 Looking for a credit card?
0:25:42 At Nerd Wallet, you can go beyond the basic comparisons,
0:25:44 filter for the features that matter to you,
0:25:46 and read in-depth reviews.
0:25:48 Ready to choose a high-yield savings account?
0:25:49 Get access to exclusive deals
0:25:51 and compare rates, bonuses, and more.
0:25:52 House hunting?
0:25:55 View today’s top mortgage rates for your home sweet home.
0:25:57 Make the Nerds your go-to resource
0:25:59 for smart financial decisions.
0:26:02 Head to nerdwallet.com/learnmore.
0:26:04 Nerd Wallet, finance smarter.
0:26:06 Nerd Wallet Compare, Incorporated,
0:26:09 and NMLS 161 7539.
0:26:20 We’re back with ProfG Markets.
0:26:23 It’s been a banner year for Palantir.
0:26:24 As we’ve discussed previously,
0:26:27 the data analytics company is uniquely positioned
0:26:30 to leverage AI as a government contractor.
0:26:33 Its stock is up 125% year-to-date,
0:26:35 thanks in part to the AI wave,
0:26:38 and has almost quintupled since 2022.
0:26:39 And as of last week,
0:26:43 the company has officially made it into the S&P 500.
0:26:45 Meanwhile, the CEO, Alex Carp,
0:26:47 has gone at a cult following.
0:26:50 On Reddit, he’s known as Daddy Carp.
0:26:52 And by making pro-America proclamations,
0:26:54 such as, quote, “We founded this company
0:26:57 “to be a ray of light to America and our Western allies,
0:26:59 “he has rallied a base of retail investors
0:27:03 “who hold about 40% of the company’s shares.”
0:27:05 So Scott, on the one hand,
0:27:08 it’s looking like Palantir is a bit of a meme stock.
0:27:11 On the other hand, it’s a very serious business
0:27:12 with government contracts accounting
0:27:14 for more than half of its revenue.
0:27:17 What do you make of this company’s success
0:27:22 and the fact that it is up 125% just incredible year-to-date?
0:27:25 – So right now, this company looks to be
0:27:27 one of the most overvalued companies in tech.
0:27:32 It snowflake in Microsoft traded 77 and 37 times.
0:27:38 Earnings, respectively, Palantir trades at 218.
0:27:41 And this guy isn’t the head of an analytics company
0:27:43 or whatever the fuck they call themselves.
0:27:45 He is an amazing storyteller.
0:27:49 And he understands some of the keys around Brande’s person.
0:27:51 He has personified the company.
0:27:52 He creates this mystery around it.
0:27:54 Just as Tesla has always tried to say,
0:27:55 “Oh, no, we’re not a car company.
0:27:57 “We’re an energy company or we’re a battery company
0:27:59 “or we’re a software company.”
0:28:02 Because if anyone actually, if he came out and said,
0:28:04 “Oh, yeah, we’re an analytics company like MicroStrategy
0:28:07 “or like, I don’t know, Gartner or whatever,”
0:28:09 they’d go, “Okay, you trade within this range.”
0:28:12 But he creates this, he kinda cloaks all of this
0:28:14 in the shroud of mystery that our biggest client,
0:28:17 although we can’t confirm it, is the CIA.
0:28:20 And his hair, the look, the distinct look,
0:28:22 he’s turned himself into a media personality,
0:28:23 went on Bill Maher.
0:28:26 And there’s always an opportunity in branding to zig
0:28:27 when everyone else is zagging.
0:28:29 As everyone was like virtue signaling
0:28:33 and letting Google employees stage a walkout during lunch
0:28:37 because for it to show empathy for the Palestinian people.
0:28:39 Jesus Christ, what a bunch of fucking jerks.
0:28:40 Yeah, that’ll show ’em.
0:28:42 Do a walkout over lunch.
0:28:43 Yeah, that’s gonna cause change.
0:28:45 That’s really gonna fill my change.
0:28:48 I mean, all this virtue signaling and bullshit wokeness
0:28:50 pretending to give a goddamn about these issues
0:28:53 as they’re literally consuming the or creating products
0:28:56 that generate the incremental electricity demand
0:28:57 of Argentina.
0:28:59 And this guy goes, fuck that.
0:29:02 And he’s like, we’re here to help America.
0:29:06 We have no problems working for the Department of Defense.
0:29:09 You know, I’m done with the politically correct bullshit
0:29:10 of Silicon Valley.
0:29:12 And people still don’t really understand
0:29:14 the company is shrouded in secrecy,
0:29:15 not because it has to be,
0:29:19 but because it creates this illusion of innovation.
0:29:21 And he’s created this brand,
0:29:25 this kind of mystical, mysterious, techie,
0:29:28 deep dark secrets in with the Defense Department
0:29:30 can do amazing things,
0:29:32 can do amazing sort of scary things.
0:29:36 And he’s very pro-America in the midst of this zombie
0:29:39 apocalypse of useful idiots roaming Palo Alto.
0:29:42 And it is resonated with retail consumers.
0:29:43 And if you look at it,
0:29:45 they actually have a much bigger ownership stake
0:29:48 amongst retail consumers.
0:29:50 And retail consumers tend to be more about momentum
0:29:54 and brand than they do about underlying fundamentals.
0:29:58 And this company is just trading at kind of evaluation
0:30:00 that just quite frankly, doesn’t make any sense.
0:30:01 So is it a great company?
0:30:02 Yes.
0:30:03 Is he a good CEO?
0:30:03 Yes.
0:30:07 And he is the new premier storyteller in the world attack.
0:30:09 And his shareholders are benefiting from it.
0:30:12 – I do want to sort of double click on this,
0:30:15 on this idea of fiduciary duty, especially,
0:30:20 because, you know, 40% retail ownership,
0:30:24 36 times sales, I think you said something like 220
0:30:27 times earnings, it’s pretty clear to me that Palantir
0:30:32 is overpriced and something of a meme stock at this point.
0:30:35 And it’s sort of because of him.
0:30:38 And I just like to get your take on whether you think
0:30:41 that is good or bad management.
0:30:45 In other words, a CEO who sort of uses their charisma
0:30:49 and uses their storytelling ability to inflate the stock
0:30:51 to a price that is quite frankly,
0:30:53 going to be a little bit unsustainable.
0:30:55 I’m wondering if you think that that is an example
0:30:58 of fulfilling your fiduciary duty,
0:31:01 or is it possible that perhaps it is betraying it?
0:31:02 – I think it’s a former Ed.
0:31:07 I mean, as a CEO, you’re trying to tell a story
0:31:10 such that you can pull the future forward, right?
0:31:12 Was it irresponsible of me to raise $15 million
0:31:15 of a PowerPoint deck at a pre-money valuation of $35 million?
0:31:18 And I’m an obligation to my investors to say,
0:31:21 I’m just a guy who’s 34 with a shaved head.
0:31:25 And I remember after I raised the money thinking,
0:31:27 I’ve committed fraud.
0:31:29 I don’t know what the fuck I’m doing.
0:31:31 – Which company is this?
0:31:33 – Brand Farm, my e-commerce incubator,
0:31:37 backed by Goldman Sachs, JPMorgan, and Maveron back in 1999.
0:31:39 We closed in December of ’99.
0:31:41 And spoiler alert, it didn’t turn out well.
0:31:44 It was literally like two months later,
0:31:46 the da bomb implosion.
0:31:49 But if you have the gift of storytelling,
0:31:50 as long as you don’t commit fraud
0:31:52 and start putting electric vehicles on a mountain
0:31:54 such that, and then angling the cameras such it,
0:31:57 it looks like the car actually has an engine in it.
0:31:59 I mean, as long as you don’t break the law or commit fraud,
0:32:02 if your ability to attract cheap capital
0:32:03 because of your storytelling, your majesty,
0:32:06 your good looks, your charm,
0:32:08 we’re proud of the progress we’ve made.
0:32:09 We need to do better, whatever it might be.
0:32:14 Or Jeffrey Bezos, 1997 shareholder letter.
0:32:15 If you read it, you just want to buy stock
0:32:17 in the goddamn thing.
0:32:20 That ability to raise capital at a cheaper price
0:32:22 than your competitors gives you the ability
0:32:23 to pull the future forward
0:32:25 and maybe grow into that stock price.
0:32:28 So what this guy’s done is absolutely,
0:32:31 I think he’s being a great fiduciary
0:32:32 as employees are getting rich.
0:32:35 And he’s now gonna have access to cheaper capital
0:32:37 to build out infrastructure, technology,
0:32:40 hire better, brighter, faster, smarter people,
0:32:42 and make investments his competitors can’t keep up with
0:32:43 and sort of pull away with it.
0:32:45 And that’s kind of the job of a CEO.
0:32:49 What I would suggest is that anyone that works
0:32:51 at Palantir and has options that distinct
0:32:53 of how excited you might feel
0:32:55 about Alex or your company or colleagues,
0:32:58 that you do one thing, sell.
0:33:00 Sell as much as you can right now.
0:33:01 You’re never gonna look back
0:33:04 and I believe in when the stock goes up,
0:33:06 you know, really be pissed off at yourself
0:33:08 for selling at 218 times earnings.
0:33:11 We’ll be right back after the break
0:33:13 with a look at the Longshoreman strike.
0:33:15 (upbeat music)
0:33:24 Support for the show comes from Greenlight.
0:33:25 As your kids get older,
0:33:26 parenting gets easier in some ways,
0:33:29 especially in some really obvious ways.
0:33:30 See you later diaper bag.
0:33:32 But in other ways, it gets more complicated,
0:33:35 especially as your kids start to gain more independence
0:33:37 and maybe a little financial independence too.
0:33:39 The fact is it’s hard for kids to manage money
0:33:41 until they’re actually in charge of it.
0:33:43 That’s where Greenlight might be able to help.
0:33:46 Greenlight is a debit card and money app for families.
0:33:48 Parents can keep an eye on kids spending in money habits
0:33:51 and kids can learn how to save, invest and spend wisely.
0:33:54 The Greenlight app also includes a chores feature
0:33:56 where you can set up one time of recurring chores,
0:33:58 customize to your family’s needs
0:34:01 and reward kids with allowance for a job well done.
0:34:03 Simply put, we were a Greenlight family,
0:34:06 a well before they even chose to advertise on Prop G.
0:34:09 Join the millions of parents and kids
0:34:11 who use Greenlight to navigate life together.
0:34:12 Sign up for Greenlight today
0:34:13 and get your first month free
0:34:16 when you go to greenlight.com/scott.
0:34:20 That’s greenlight.com/scott to try Greenlight for free.
0:34:23 Greenlight.com/scott.
0:34:27 – When Kamala Harris and Donald Trump met
0:34:28 on the debate stage,
0:34:32 it was obvious that these were two very different people.
0:34:35 – But JD Vance and Tim Walls actually have a lot in common.
0:34:37 They’re both white men from the Midwest.
0:34:38 They’re both family men
0:34:39 and they were both in the service.
0:34:42 – But they disagree on what it means to be a man.
0:34:44 – Here’s my light pack.
0:34:46 Surround yourself with smart women and listen to them
0:34:48 and you’ll do just fine.
0:34:50 – Today explained, every weekday,
0:34:51 wherever you get your podcasts.
0:35:03 – We’re back with Prop G Markets.
0:35:04 The most disruptive strike in decades
0:35:07 could take hold of the U.S. economy on Tuesday.
0:35:12 Roughly 45,000 workers at 36 sea ports from Maine to Texas
0:35:14 are expected to walk out of the job,
0:35:17 halting half of the nation’s cargo indefinitely.
0:35:19 The International Longshoremen’s Union
0:35:21 is demanding higher wages
0:35:24 and a ban on automating freight movements.
0:35:25 The United States Maritime Alliance,
0:35:27 which represents the ports,
0:35:29 has called their demands unreasonable
0:35:31 and the two sides have not met
0:35:33 for contract negotiations since June.
0:35:38 – Scott, you’ve been particularly outspoken on unions
0:35:39 and on strikes over the past year.
0:35:42 What do you make of this potential strike
0:35:45 from the International Longshoremen’s Association?
0:35:47 – I think if they’re in a position to leverage,
0:35:50 I like middle-class workers getting more money.
0:35:53 I believe in the right to assemble, the right to strike,
0:35:57 and if they’re in a position to demand those sorts of wages,
0:35:59 technically that’s a function of supply and demand,
0:36:01 fine, more power to them.
0:36:03 What makes no sense and never works
0:36:06 is trying to ban or put the genie back in the bottle
0:36:09 in terms of automation and technology.
0:36:12 You can save off the wolves from the door
0:36:14 for a little while, but eventually,
0:36:16 if you’re able to do it domestically,
0:36:18 ’cause your union or your contacts with government
0:36:20 are so strong, then those jobs ultimately
0:36:21 just end up getting off short
0:36:23 or at some point they start off loading shit in Mexico
0:36:26 and driving it up in trucks or something like that.
0:36:29 But these guys make about, I guess, about 39 bucks an hour,
0:36:31 about 81,000 a year, up 11% since the start
0:36:33 of their expiring six-year contract.
0:36:37 Over the same period, inflation has increased 24%.
0:36:38 So they’re 13% down.
0:36:41 Now, that’s a far cry from the 77% they’re asking for,
0:36:45 so they absolutely deserve a raise.
0:36:46 And I would imagine supply and demand
0:36:48 would probably agree with that.
0:36:50 And J.P. Morgan, transportation analyst,
0:36:53 believed that this strike could cost the economy $5 billion
0:36:55 a day or about 6% of GDP.
0:36:57 Now, this is one of those instances
0:36:59 where the president has authority to intervene,
0:37:01 but he said he doesn’t plan to take action,
0:37:03 especially as he gets closer to the election.
0:37:06 The last thing he wants to do is fuck up his union vote.
0:37:08 The notion of trying to hold off automation,
0:37:10 that’s just not gonna work.
0:37:12 I don’t even think there’s a way to do that.
0:37:15 And I think it’s just sort of a ridiculous ask.
0:37:19 What they could ask for is more money for worker retraining
0:37:23 or an agreement with the port to upskill some of these folks
0:37:24 so that they understand this technology
0:37:25 or perhaps even get into programming
0:37:27 around this technology or whatever it might be.
0:37:32 I’m in Munich and I did this chart on worker retraining funds
0:37:36 and the US allocates far less money for worker retraining
0:37:39 than any developed nation in the world.
0:37:40 But anyways, back to me.
0:37:44 So red envelope, I got kicked off of the board
0:37:49 by Sequoia Capital who the representative there
0:37:52 was not only really aggressive and ignorant,
0:37:55 but he knew absolutely nothing about retailer brands
0:38:00 and was supporting just this incompetent CEO
0:38:03 and was also using the company as a dumping ground
0:38:05 for the failed products of his portfolio company.
0:38:07 I got into a pissing match with him, I lost.
0:38:08 I got kicked off the board
0:38:10 and I spent the next two years trying to raise capital.
0:38:13 – This is legendary investor, Michael Moritz by the way.
0:38:15 – There you go.
0:38:16 Most powerful man in venture capital.
0:38:18 Also really an awful human being.
0:38:22 Anyway, so I raised a bunch of money,
0:38:25 came back in thinking I was the conquering hero back
0:38:27 and first Christmas or first holiday,
0:38:31 I sweep out the old board, put in my people
0:38:35 and basically the cruel truth or the secret,
0:38:38 the uncomfortable secret especially retail
0:38:41 is that you lose money for 44 weeks
0:38:43 and you print money for eight weeks
0:38:45 basically from Thanksgiving through Christmas
0:38:48 and you make all your money in that short period.
0:38:52 So during that period, we have these software guns
0:38:54 at our Kentucky Ohio Fulfillment Center
0:38:56 and the software that spits out the label
0:38:59 spits out I think 12,000 of the wrong address.
0:39:02 So we send 12,000 gifts to the wrong homes.
0:39:05 That is devastating because if retailers
0:39:07 were not trying to create moral hazard
0:39:09 or the wrong incentives, when you wanna return something
0:39:12 it would be more economical for them to say just keep it
0:39:15 ’cause to return it, clean it, restock it
0:39:16 and then resell it is more expensive
0:39:18 than just telling you to keep it
0:39:20 but they don’t wanna create incentive to just start lying.
0:39:22 Returns are a fucking nightmare for retailers.
0:39:26 Anyways, so we have 12,000 gifts going to the wrong people.
0:39:27 So we have a customer service nightmare
0:39:30 at the call center, angry customers
0:39:33 and just thousands of returns we weren’t anticipating.
0:39:36 In addition, the Longshoremen went on strike in Long Beach
0:39:39 and a disproportionate amount of our holiday merchandise
0:39:42 was stuck on a cargo ship eight miles off the coast
0:39:44 to Long Beach and there was nothing we could do about it
0:39:45 so we didn’t have product.
0:39:49 And then finally some cogent 28 year old credit analyst
0:39:51 at Wells Fargo where we had our letter of credit
0:39:54 where we would tap it to make these big inventory purchases
0:39:58 before the holiday said I’m worried
0:40:01 about the credit markets, we’re pulling your line.
0:40:03 So all three of these things basically took our stock
0:40:06 from like seven bucks to 70 cents in two or three weeks
0:40:09 and within I think about two or three months
0:40:11 we were chapter 11 going through a reorganization.
0:40:14 I’d also like to add that all the vendors got paid
0:40:16 all the employees maintained their jobs
0:40:18 but the equity holders including myself
0:40:19 we all got wiped out.
0:40:22 Anyways, so I have a little bit I’m a little bit triggered
0:40:24 when I hear about a Longshoremen strike
0:40:26 but look they have the right to strike
0:40:27 I hope they get more money
0:40:30 but they should drop the demands.
0:40:32 They’re just gonna delay the onset of the strike
0:40:35 and not get anything more if they come up to the table
0:40:36 and say you’re not allowed to use technology
0:40:37 that’s just not gonna work.
0:40:40 – One of the things that we like to think about
0:40:43 on this podcast when it comes to strikes and unions is
0:40:44 who has the leverage?
0:40:46 Who actually has the bulking power?
0:40:50 When we looked at the WGA and the writer’s strike
0:40:52 it’s very clear to us that the writers had very little
0:40:54 leverage and that’s why they got a shady deal
0:40:57 and the same was true of the SAG-AFTRA strike
0:40:59 but there’s one number that you mentioned there
0:41:01 that I think is crucial here
0:41:03 and that number was 6%
0:41:07 and that is the percentage of daily GDP in America
0:41:11 that will be lost if all of these guys go on strike.
0:41:15 It will cost the US $5 billion per day.
0:41:19 It is a huge amount of money that they are putting at risk
0:41:21 and your own story there,
0:41:23 they essentially put you out of business.
0:41:26 They were the nail in your coffin
0:41:30 and so they are asking for some pretty unreasonable demands,
0:41:32 ban robots, that’s ridiculous,
0:41:36 increase salaries by 77% that seems crazy
0:41:39 but those numbers actually don’t matter as much
0:41:41 as that 6% number.
0:41:43 They can ask for whatever they want
0:41:44 because they have so much power.
0:41:46 If they want to go on strike,
0:41:49 they pretty much will get whatever they’re asking for
0:41:52 and we saw this happen with the UPS strike as well.
0:41:55 The UPS workers were making some pretty,
0:41:58 perhaps unreasonable demands and they got them
0:41:59 because we need the UPS workers.
0:42:03 We cannot allow our postal system to go out of business.
0:42:06 So I get the feeling that they’re too important,
0:42:09 they’re too systemic to our economy
0:42:11 that actually they could come back and say,
0:42:14 okay, we’ll give you a 77% raise.
0:42:16 – Yeah, just as I don’t think the riders,
0:42:20 I didn’t, I felt bad,
0:42:21 but I didn’t feel there was anything wrong with them,
0:42:22 not getting what they wanted
0:42:24 because supply and demand ultimately takes the market.
0:42:27 At the same time, if these guys are in a position of leverage
0:42:31 where they need their skills to keep the economy operating
0:42:32 and they can still make money
0:42:33 by giving them substantial raises,
0:42:35 then I don’t, I feel they deserve it.
0:42:37 If they can get it, then quote unquote, they deserve it.
0:42:40 Deserve and fair are kind of weird words.
0:42:42 This is strategic.
0:42:45 They’re doing it for a reason at this time of the year, right?
0:42:48 This is when literally everyone’s like, okay,
0:42:50 they’re calling their local representative
0:42:52 or they’re calling the port and they’re saying,
0:42:56 if I can’t get my shit in my store for the holidays,
0:42:58 I’m out of business.
0:43:00 So I really hope you guys can figure this out.
0:43:02 And they’re calling the representative saying,
0:43:06 if I can’t figure out a way to get these stuffed animals
0:43:11 to Mike and Betty’s toy store in Wasa, Wisconsin,
0:43:13 we’re fucked.
0:43:14 – Yeah.
0:43:16 And to keep prices, to keep prices down.
0:43:18 I mean, if they go on strike
0:43:20 and we gunk up the supply chain even more,
0:43:21 prices are gonna skyrocket,
0:43:24 which is gonna be an absolute nightmare.
0:43:25 – You know, this is a delicate situation.
0:43:29 My guess is they kind of, the ports or wherever
0:43:32 is the employing agency here holds their nose
0:43:34 and just tries to work this out sooner rather than later.
0:43:37 And I’m sure the president is urging them to do that.
0:43:42 But yeah, I don’t, you know, at least like these guys,
0:43:43 these guys don’t have their head up their ass.
0:43:45 They’re a little bit unrealistic
0:43:49 about asking to put a pause on technology,
0:43:51 but it strikes me that in an economy,
0:43:55 they’re strong with retail as strong as it is right now,
0:43:57 with the fact that their wages have not kept pace
0:44:00 with inflation, a big ask is not unreasonable.
0:44:01 They won’t get that,
0:44:03 but they’ll get something pretty substantial
0:44:05 and there’s money there.
0:44:09 There’s juice to squeeze from the lemon called commerce
0:44:10 that ports play a big role in.
0:44:13 In contrast to the WGA, they’re like,
0:44:16 “I know let’s strike at a time when the people paying us
0:44:18 are in a world of hurt.”
0:44:20 – I’d like to do a quick profile of the president
0:44:23 of the International Longshoreman’s Association.
0:44:25 This guy is named Harold Daggett.
0:44:27 He is the president of the union.
0:44:30 He is infamously aggressive.
0:44:34 He has posted videos publicly dissing Biden.
0:44:36 He recently posted a video saying,
0:44:39 “I will cripple you if you don’t meet our demands.”
0:44:42 He’s also accused of having ties to the mob.
0:44:45 People think that because he has these ties to the mob,
0:44:49 that’s how he worked his way up to be president of the ILA.
0:44:52 And my favorite stat is that last year,
0:44:54 he received in compensation
0:44:59 from the International Longshoreman’s Association $728,000.
0:45:04 He is one of the most well compensated union leaders
0:45:07 in America, probably the best compensated.
0:45:10 He seems like maybe a strategic genius,
0:45:11 the way he’s going at this,
0:45:13 the way he’s timing this strike,
0:45:15 the way he’s being so aggressive.
0:45:17 And it feels like, you know,
0:45:18 you can call those demands unreasonable,
0:45:21 but I’ll bet that that’s all part of the plan.
0:45:23 – A guy running this big an organization,
0:45:26 him making $720,000, I don’t have a problem with that.
0:45:28 And also, I think he seems mostly,
0:45:29 I think he seems like an impressive man
0:45:31 because I am shit scared of him right now.
0:45:32 – Right?
0:45:36 So I hope that he’s, I think he’s a very good man.
0:45:37 I’m with you.
0:45:39 I’m with you, Mr. Daggett.
0:45:40 – Best of luck to you.
0:45:45 – Let’s take a look at the week ahead.
0:45:47 We’ll see the unemployment rate for September
0:45:49 and earnings from Nike.
0:45:51 Scott, any predictions?
0:45:54 – There is some new data coming out showing that
0:45:57 when states legalize gambling,
0:46:00 bankruptcies go up somewhere between 20 and 35%.
0:46:01 And I worry that we’re raising,
0:46:02 especially a generation of boys
0:46:04 who seem to be more prone to addiction,
0:46:07 who are just gonna slipstream right into
0:46:11 different types of drug and gambling addictions.
0:46:14 I think we are going to see just an upsurge
0:46:18 in rehab facilities treating gambling addiction,
0:46:21 bankruptcies and suicide for people.
0:46:24 Gambling addiction actually has the highest suicide rate
0:46:27 because people don’t know a lot of times.
0:46:28 And if you were addicted to meth,
0:46:30 we would know it and we would try and do something about it.
0:46:33 But if you got in over your head and online gambling
0:46:36 and you felt like there was no way out, nobody knows it.
0:46:38 And that’s why it has the highest suicide rate
0:46:39 of all the addictions.
0:46:41 And so it just got me thinking that
0:46:44 you have all of these companies who are basically building
0:46:47 or prepping or grooming an entire generation of young men
0:46:49 to become addicts.
0:46:50 And Richard Reeves,
0:46:52 the president of the American Institute for Boys and Men
0:46:54 just came out with a study showing that
0:46:56 the incremental deaths of despair among young men
0:46:59 has gone up so dramatically since 2004.
0:47:01 We’ve lost an incremental 400,000 men,
0:47:03 which is how many men we lost in World War II.
0:47:05 And I think it’s just going to get worse.
0:47:06 And I know this is a terrible prediction,
0:47:09 but unfortunately gaming stocks are going to surge.
0:47:11 These private equity companies rolling up rehab clinics
0:47:13 are going to see a huge increase.
0:47:15 Nova Nordisk and GLP One drugs are going to boom
0:47:17 because they’re going to start using GLP One
0:47:19 to try and treat gambling addictions.
0:47:22 But we are literally going to spit out millions of young men
0:47:27 who are craving and ready and teed up to be addicts.
0:47:32 – Nine, nine.
0:47:34 – Yeah, that is a very depressing prediction.
0:47:35 – Isn’t that awful?
0:47:39 – One in 10 bankruptcies are a result of gambling.
0:47:43 I mean, it’s getting pretty crazy.
0:47:44 Do you, are you gambling much?
0:47:45 – No, what, you know what’s weird?
0:47:47 When I go to Vegas now, I don’t gamble.
0:47:47 I used to love to gamble.
0:47:48 I don’t gamble anymore.
0:47:50 – You just go to magic shows?
0:47:53 – Yeah, yeah, that’s what I do, magic shows.
0:47:56 – This episode was produced by Clay Miller
0:47:58 and engineered by Benjamin Spencer.
0:48:00 Our associate producer is Alison Weiss.
0:48:01 Our executive producer is Catherine Dillon.
0:48:03 Mia Silverio is our research lead
0:48:05 and Drew Burris is our technical director.
0:48:07 Thank you for listening to “ProfG Markets”
0:48:09 from the Vox Media Podcast Network.
0:48:11 Join us on Thursday for our conversation
0:48:16 with Lena Kahn, chair of the FTC, only on “ProfG Markets.”
0:48:22 ♪ Lifetimes ♪
0:48:29 ♪ You help me ♪
0:48:34 ♪ In kind reunion ♪
0:48:41 ♪ As the world turns ♪
0:48:46 ♪ And the ground flies ♪
0:48:49 ♪ In love ♪
0:48:51 you