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0:00:51 Have you noticed that headlights seem brighter these days?
0:00:53 It’s more than just a nuisance for some people.
0:00:58 Those headlights and other LED lights knocked me out of being a teacher.
0:01:02 I just, I couldn’t get to work anymore without suffering these impacts,
0:01:04 these neurological, psychological impacts.
0:01:07 The dark side of those gleaming headlights.
0:01:10 That’s this week on Explain It To Me.
0:01:13 Listen every Sunday morning, wherever you get your podcasts.
0:01:18 Welcome to Raging Moderates.
0:01:19 I’m Jessica Tarlov.
0:01:24 Scott’s off today, but I’ve got a guest who knows the inner workings of Trump’s world better than most.
0:01:26 She’s been in the room, she’s seen how the machine operates,
0:01:30 and she’s here to help us make sense of what’s happening inside the current administration.
0:01:32 Kellyanne Conway joins us today.
0:01:34 Welcome to the show, Kellyanne.
0:01:35 Thank you, Jess.
0:01:36 Nice to be with you.
0:01:38 It’s nice to be with you off campus a bit.
0:01:42 I feel like, you know, we’re always at Fox and you have like three minutes to speak,
0:01:44 and now we have an hour.
0:01:46 Let’s dig in.
0:01:47 Let’s dig in.
0:01:49 In today’s episode of Raging Moderates,
0:01:52 we’re going to be talking about the biggest scandal to hit the Trump administration yet,
0:01:55 Trump’s immigration policies heading to the Supreme Court,
0:01:59 and what a post-Trump world looks like for both Republicans and Democrats.
0:02:04 So last week, the biggest political story was by far and away Signalgate,
0:02:06 and the fallout is still unfolding.
0:02:09 The Atlantic’s editor-in-chief, Jeffrey Goldberg,
0:02:13 somehow got added to a Signal group chat where top Trump administration officials
0:02:16 were talking about airstrikes on the Houthis in Yemen.
0:02:20 The White House tried to push back, but once the Atlantic published the full transcript,
0:02:21 things only got messier.
0:02:25 Now Congress is looking into it, Republicans are in damage control mode,
0:02:28 and national security concerns are piling up.
0:02:34 Kellyanne, what’s your kind of top-line feeling about so-called Signalgate?
0:02:36 What did you think when you saw the story?
0:02:38 Do you feel any differently than you did on day one?
0:02:42 Well, clearly it was a mistake, and a mistake has been admitted and rectified.
0:02:46 Nobody was purposely inviting a reporter, let alone Jeffrey Goldberg of the Atlantic,
0:02:53 to this group chat where the Secretary of Defense predominantly was giving an update
0:02:58 to the national security team and others like the chief of staff and deputy chief of staff
0:03:02 for policy and the like on what was about to happen in Yemen.
0:03:06 And when I hear he was invited, he wasn’t invited.
0:03:07 I don’t have Jeffrey Goldberg in my contacts.
0:03:12 I can’t add him to anything on my phone, certainly for many of the reasons that President Trump has
0:03:14 actually articulated himself.
0:03:20 I think this is one thing that a big bone that the media will continue to gnaw on, though,
0:03:25 because it seems like the very first time they can truly sink their teeth into the administration,
0:03:26 and President Trump said as much.
0:03:29 Jessica, people tried it with the January 6th pardons.
0:03:30 They tried it with the doge cuts.
0:03:36 They’re trying it by torching and burning down the dealerships of innocent Tesla dealers and
0:03:37 sellers and owners.
0:03:42 They’re trying everything they can, but I would really echo what Governor Gavin Newsom said over
0:03:48 the weekend, if not previously, which is that the Democrats are suffering a big image and messaging
0:03:48 problem now.
0:03:50 It’s not about another messenger.
0:03:51 It’s about a message.
0:03:57 And I think if the entire party is really centered on how can we screw Trump and the American
0:04:05 president and, by extension, America herself, then this signal event that was revealed one
0:04:11 week ago today, Jessica, will be probably the best and highest hope.
0:04:16 But it’s a distraction away from the volume and velocity with which President Trump and his
0:04:17 administration are operating.
0:04:22 If you look at the CBS YouGov poll over the weekend, you look at other polling, people
0:04:27 are fairly—they’re giving Donald Trump the space and the grace this time to build an
0:04:34 economy, to stop the illegal border crossings, to stop these wars that he inherited in Ukraine
0:04:38 and the Middle East, and to get energy production back online.
0:04:44 I don’t know why we had a war on fossil fuels and fracking and why President Biden paused the
0:04:45 LNG permits.
0:04:51 But all these things that President Trump is doing that Americans do like cannot be subsumed
0:04:56 by something that was accidental, unintentional, and a mistake.
0:04:56 Yeah.
0:05:00 So there was a lot in there, and I want to try to pick most of it apart.
0:05:08 But there were a ton of specifics in the conversation, most coming from Secretary Hegseth, some coming
0:05:12 from National Security Advisor Mike Waltz, that are not just casual conversation.
0:05:14 People have said this is obviously classified.
0:05:20 If someone of a lower rank had done something like this, they would be out of a job and maybe
0:05:22 going before a military tribunal.
0:05:24 The American public knows how serious this is.
0:05:26 YouGov did some polling on it.
0:05:28 Fifty-three percent say that this is a serious problem.
0:05:34 And conversely, for instance, Trump’s classified documents case was less—as a percentage—less
0:05:38 serious Clinton’s emails, as well as Biden’s classified documents.
0:05:45 So the American public understands that this is very serious and it’s not something to brush
0:05:45 over.
0:05:50 And I don’t think the administration is going to be able to, even if you want to paint this
0:05:52 as something of a media obsession.
0:05:53 Well, it certainly is a media obsession.
0:05:57 Fifty-three percent of Americans, you’re saying, based on the way a particular poll question was
0:06:02 asked in a particular poll, say this is serious, but 99 percent of the mainstream media says
0:06:02 it is.
0:06:04 So there’s a disconnect there, as usual.
0:06:11 But look, I’m glad you admitted that the Donald Trump documents case in Mar-a-Lago was thin.
0:06:13 That’s all obviously been litigated.
0:06:21 I disagree completely that President Biden housing his classified documents next to an old Corvette
0:06:26 in a garage that his son also had access to and his myriad problems.
0:06:28 I do think that’s serious.
0:06:33 And frankly, the country rejected Hillary Clinton for many reasons, but in part because they didn’t
0:06:33 trust her.
0:06:37 They shot—if you look at the Washington Post polling right before the election in 2016,
0:06:42 Jessica, people didn’t think she was honest or trustworthy, ABC News, Washington Post poll,
0:06:47 and others, and part of it was because of the way she had handled her emails, the way
0:06:52 she had handled, I don’t know, dozens or a dozen or so phones and bleach bidding and all
0:06:53 of that.
0:07:00 So I think this is important just because, thank God, no damage was done, and thank God that
0:07:01 the mission was successful.
0:07:04 And people are about production and delivery.
0:07:08 I think the Democrats only want to be about process when they think it benefits them.
0:07:10 And I know Trump derangement syndrome is real.
0:07:12 I know it starts at stage five.
0:07:15 I know there’s no vaccine cure or therapeutic for it.
0:07:20 But in this case, it was a successful mission, and people will focus on that.
0:07:28 They will wonder why the facts that under Biden’s watch, there were 174 attacks on our Navy warships,
0:07:34 that these terrorists and these pirates were disrupting regular routes so that you could
0:07:37 not have safe and efficient passage in these routes.
0:07:44 And now this is all being turned around because you actually have bold leadership in the White
0:07:45 House and in the national defense team.
0:07:47 So people should look at the success of the mission.
0:07:49 I believe they will.
0:07:55 And again, when mistakes are made, I think the most important thing to do in life and in
0:07:59 politics and anywhere else in the national security team is to admit the mistake, figure
0:08:03 out how it happened, promise that it will never happen again.
0:08:10 If mistakes were made in Afghanistan, then I’ve yet to hear President Biden or Vice President
0:08:17 Harris say it, the most energy that President Biden seemed to exert after 13 service members
0:08:22 were senselessly killed because he went against the advice of most of his national security team
0:08:27 and his generals and withdrew out of Afghanistan on a dime almost immediately.
0:08:32 The most energy he exerted was looking at his watch while the grief stricken families were just
0:08:36 looking for a little bit of grace and recognition from the commander in chief.
0:08:41 That is something Democrats have been very critical of, leaving Bagram Air Force Base in the
0:08:45 wingspan of China, leaving the Taliban in charge of Afghanistan.
0:08:49 I mean, really, Jessica, what’s the point that we had a female vice president who wanted to be the
0:08:53 first female president of the United States in Kamala Harris if the women in Afghanistan have
0:08:58 fewer rights and less free now because of the policy prescriptions and the decisions that
0:08:59 she and her boss made?
0:09:07 And so if we’re going to talk about relative circumstances and consequences, I think the
0:09:10 more relevant ones are letting just millions in here across the border.
0:09:15 I think it’s going to be a very rough week and month of April for the Biden team, Biden-Harris
0:09:19 team, with respect to all these books coming out where you’ve got
0:09:26 Biden people talking on the record and unattributed about Biden’s compromised capacity.
0:09:30 So if we’re going to talk about relative things, I think this is very important.
0:09:34 The fact that these books say that Kamala Harris’s aides were preparing for Joe Biden to
0:09:37 die in his first term is like…
0:09:39 I actually think that that was just responsible.
0:09:43 Frankly, if you have the oldest president in history, you should be open to the fact that
0:09:44 he might pass away.
0:09:48 But listen, I know that I’m going to have a very bad April on the five.
0:09:49 I am prepared for it.
0:09:51 We’re going to be talking about this ad nauseum.
0:09:55 But I’m not trying to do a comparison.
0:10:00 I’m trying to have a conversation about this as a scandal in and of itself.
0:10:05 And I do want to note that the Trump’s classified documents case, it wasn’t adjudicated.
0:10:07 It was dismissed because Donald Trump won.
0:10:08 Eileen Cannon just did what he wanted.
0:10:14 And Hillary Clinton was investigated by the FBI, the State Department and Congress over that.
0:10:16 And as you said, she ended up losing the election.
0:10:20 So using those as comps, I don’t think is really fair in this circumstance.
0:10:25 And it seems quite clear from the Wall Street Journal’s reporting that National Security Advisor
0:10:30 Mike Waltz used information that we got from the Israelis, so an ally of ours, an incredibly
0:10:36 important one, about the missile expert who was heading into his girlfriend’s house, which
0:10:37 they ended up striking.
0:10:43 And the Israelis are apparently very upset about this, expressing to the White House that
0:10:45 sources and methods were compromised.
0:10:50 And it seems like a pretty clear line between sources and methods and something being classified.
0:10:56 And if we are to grow from this, do you feel like the administration should open themselves
0:10:58 up to investigations?
0:11:00 There should be a DOJ investigation.
0:11:03 I know we’re going to get the Senate Armed Services looking into it.
0:11:07 Roger Wicker is on board with that, and Jack Reed, the ranking Democrat as well.
0:11:12 But do you think that that’s deserved or that we’re going to move forward with legitimate
0:11:16 and earnest investigations into how something like this could happen and why they were on
0:11:20 some of them personal phones and using an unsecured app?
0:11:25 Because, you know, if those phones were hacked by the Russians, the Chinese, the Iranians, they
0:11:27 don’t need to have someone’s password to get into signal.
0:11:29 They can just see everything that’s happening on the phone.
0:11:31 So, Jessica, there’s much to unpack there.
0:11:36 I, like you, am aware of the public reports that the Senate Armed Services Committee intends
0:11:41 to investigate what happened and why and how and the like.
0:11:43 That’s probably the most appropriate form.
0:11:50 This country seems super fatigued from Department of Justice investigations, particularly in this
0:11:51 last.
0:11:56 Merrick Garland, Jack Smith, and all the law firms now paying some of the ultimate prices
0:12:00 and, frankly, capitulating immediately because of their involvement.
0:12:03 But, look, I take national security very seriously.
0:12:08 I was not a national security official, but I had a TSSI when I was in the White House.
0:12:11 And I will tell you, I don’t have Signal on my phone.
0:12:12 I don’t have Jeffrey Goldberg in my contacts.
0:12:14 Why not?
0:12:19 Well, just I would note that in the first Trump administration, the first time I even learned
0:12:24 about Signal, one of the people who worked there who liked to call everybody else a leaker seemed
0:12:25 to live on Signal.
0:12:26 So I get it.
0:12:32 But in this case, I do take very seriously the sworn testimony almost a week ago, Jessica,
0:12:39 of John Ratcliffe, formerly of ODNI, now our CIA director.
0:12:44 And he swore under oath to the Senate last week that one of the first things that he was told,
0:12:48 which, you know, the rest of the team would have been told when he became the CIA director
0:12:55 two months ago, is that Signal was installed on his computer and that it was an acceptable
0:12:56 way of communicating.
0:13:03 If that’s the CIA director talking, I’m going to give that the legitimacy and credence that
0:13:03 it deserves.
0:13:10 So, yes, I think if you’re going to have investigations, the legislative branch wanted to look at what the
0:13:13 executive branch did is probably the way this is going to go.
0:13:20 But again, and I like the fact that President Trump, as is his practice, very unique and
0:13:24 typical for him, was forward facing about this saying, I don’t know what happened.
0:13:25 I don’t use Signal.
0:13:26 I wasn’t part of that.
0:13:28 But we’re going to take a look at it.
0:13:29 I’ve asked Mike Waltz to take a look at it.
0:13:30 He’s a good man.
0:13:35 Then, you know, he admitted it came from his team or him himself, put the group together,
0:13:39 accidentally added someone and the like.
0:13:45 You’ve had two national security officials on two different days last week testify under
0:13:45 oath.
0:13:50 Tulsi Gabbard, ODNI, and of course, the aforementioned CIA director, John Radcliffe.
0:13:51 Yeah.
0:13:53 Well, Tulsi had to correct herself from the day before.
0:13:55 She had a bit of a brain fog.
0:13:59 And yes, Signal was installed and it was Biden-era guidance, but you were supposed to use it for
0:14:01 ordinary text messaging.
0:14:03 You were not supposed to use it for classified information.
0:14:10 But you touched on something that is always, as an outsider who’s very interested on the
0:14:16 inside of what goes on in Trump world, this tension between how Trump feels about the media and
0:14:23 especially someone like Jeffrey Goldberg, who he has been mad at, to say the least, for several
0:14:25 years now because of the suckers and losers story.
0:14:26 Well, it’s just a lie.
0:14:29 Okay.
0:14:32 Yeah, we’re certainly not going to litigate that today, but we know what Jeffrey Goldberg
0:14:34 means to Trump.
0:14:40 But do you think that the bigger sin, if in the president’s mind, is the fact that someone
0:14:45 was clearly in contact with Jeffrey Goldberg, maybe obviously unintentionally putting him
0:14:50 in that chat and this whole thesis of he got, quote unquote, sucked in is obviously ridiculous,
0:14:56 or is what his top national security heads were doing the bigger sin?
0:15:01 So is it the, you know, maybe you’re a leaker, you’re talking to the press, or is it the sharing
0:15:03 of classified information and being in that group chat?
0:15:04 That’s all hypothetical.
0:15:09 And the president, I think, himself has said, others have said there was nothing classified
0:15:09 in there.
0:15:17 But look, I think there’s just too much, too many hypotheticals in there for me to make a
0:15:22 credible judgment until we know all of the facts.
0:15:25 But I will say it’s not just Jeffrey Goldberg.
0:15:29 I mean, sure, the Atlantic was first out there perhaps saying impeach him.
0:15:29 I don’t know.
0:15:33 I think the Washington Post at 12, 15, 15 minutes after President Trump was born in on January
0:15:37 20, 2017, the Washington Post said now, you know, it’s time to impeach.
0:15:40 Maybe a different post now, but that was the post then.
0:15:44 Let’s not even want an American president to succeed or America to succeed.
0:15:51 And that’s been, look, Jessica, that the mainstream media’s job in the Trump era too often has
0:15:53 not been to get the story, but to get the president.
0:15:56 And I think it helped him win this time, frankly.
0:16:01 I think it has absolutely helped President Trump, who is seen as resilient and a survivor and gotten
0:16:07 the biggest second chance I’ve ever seen for anyone in this second term eight years before
0:16:13 after he was first elected, that I think that the mainstream media’s overall approval rating
0:16:15 going way down.
0:16:21 And there’s sort of this sort of elite, effete way of telling everybody, this is what’s important
0:16:26 to you as a consumer of news and information, as a voter, as an American.
0:16:28 And we’re going to tell you what’s best for you.
0:16:34 And if you disagree, you’re racist, xenophobic, uneducated, hillbilly, wearing a red MAGA hat.
0:16:39 I mean, look at this ridiculous, crazed woman who committed crimes on video just from this
0:16:40 weekend on New York City subway.
0:16:42 It’s in the New York Post today.
0:16:46 She’s like, she’s wagging her finger in a guy’s face because he has on a red MAGA hat.
0:16:48 And she’s calling him all these names.
0:16:51 I like to call her names too, but why would I dignify her?
0:16:55 Except that what happens is she chases him off the platform and face plants.
0:16:57 I mean, people just have to stop.
0:17:00 You have to stop committing violence at Tesla dealerships.
0:17:03 You have to stop wagging your finger in front of people’s faces.
0:17:08 And, you know, part of me, as Trump’s campaign manager in 2016, and then counseled the president
0:17:13 from day one, I had 24-7 Secret Service when we first arrived in Washington.
0:17:19 And inside my house was a seven-year-old, eight-year-old, a 12-year-old, and a 12-year-old.
0:17:20 That is a disgrace.
0:17:23 And that’s only because of the threats of violence.
0:17:25 So sure, we can talk about this, that, and the other.
0:17:30 But what the media have done, them direct messaging my 14-, 15-year-old daughter at the
0:17:32 time, disgrace should be held to account.
0:17:35 So I don’t lump everybody in there.
0:17:41 But this whole notion that the job is to, quote, stop Trump, get Trump rather than get the story,
0:17:46 that’s why when things like Signal happened last week, sure, people were held to account.
0:17:49 The president had a special meeting, had the cameras in there, as he always does.
0:17:51 What a difference from Biden-Harris.
0:17:55 Has the cameras in there, is answering the questions, is saying Mike Waltz took responsibility, and
0:17:57 or is going to further investigate it.
0:18:00 So at least he’s engaging in the media.
0:18:02 It’s not particular to any one reporter.
0:18:03 It’s his entire ethos.
0:18:07 George Stephanopoulos, ABC News, has had to pay $15 million.
0:18:14 He was repeatedly told, don’t call Donald Trump, don’t refer to him by that word, and kept doing
0:18:14 it anyway.
0:18:19 You’ve got all these other places, like Metta, now giving money to President Trump’s library.
0:18:24 I mean, people are having silence and shadow ban and censor, not just of the former president
0:18:27 of the United States at the time, but his supporters, too.
0:18:32 Couldn’t you argue, though, that they’re doing that because they’re afraid of President Trump
0:18:38 and what he might do, versus that they genuinely feel some sort of affection for him, or they’ve
0:18:39 seen the light?
0:18:43 Like with Mark Zuckerberg, I think that that’s quite clear what’s going on.
0:18:44 He doesn’t want to be investigated.
0:18:46 He already has a case that’s coming up.
0:18:52 So, I don’t know, you think everyone just woke up one day and were like, oh, you know,
0:18:57 I’ve been blind to how incredible President Trump is and what a huge victim he is?
0:18:59 Or people are trying to be smart business folks?
0:19:05 Whatever combination it is of what you suggested, let me suggest an alternative to that, which
0:19:13 is many of them have said, wow, that was a really overwrought, unfair reaction to what
0:19:18 was happening where we’re shadow banning, censoring, and silencing websites.
0:19:24 I mean, people looked at the New York Post losing its Twitter feed for two weeks before
0:19:29 the 2020 elections because they dared to tell the truth that no one else would, that Hunter
0:19:31 Biden’s laptop is real.
0:19:35 And there’s discussion on there that’s actually relevant to voters in making the decision between
0:19:37 Trump and Biden in 2020.
0:19:42 They’d want to know about all this money flowing to the Biden family from Ukraine, from China.
0:19:49 This guy, Hunter Biden, I mean, Joe Biden may have no energy, but Hunter Biden had no energy
0:19:52 experience and he’s on the border Burisma and so on and so forth.
0:19:57 And he’s talking to the big guy and he’s so that was all relevant, but it was shut down
0:19:58 by Jack Mercy on Twitter.
0:20:02 And so was the New York Post and then 51 intelligence officers, et cetera.
0:20:08 Like this is all this makes people feel that there is not just two tiers, two tiered system
0:20:11 of justice, Jessica, but a two tiered system of media allowances.
0:20:16 Like the First Amendment somehow applies less to people because they like or vote for Donald
0:20:16 Trump.
0:20:17 And that’s just not fair.
0:20:19 And I think there’s been a big comeuppance that way.
0:20:21 I totally agree with you.
0:20:25 I mean, I listen, I work our colleagues feel similarly to you.
0:20:27 I talk about this on an almost daily basis.
0:20:32 I would know what the laptop story that was down for 24 hours and Donald Trump was the
0:20:37 one in office when this was going on and coordinated with social media companies for quote unquote
0:20:41 censorship, certainly about covid, just the same as any Democrat would have.
0:20:47 But, you know, I tend to think the election was not going to get swayed on Hunter Biden’s dick
0:20:52 picks. And that was what was the main concern of his father, which were on that laptop.
0:20:55 But listen, what’s done is done.
0:21:00 And frankly, I think Democrats would have been better off if Trump had won in 2020 versus
0:21:01 won this time.
0:21:06 And I know a lot of people in his orbit who feel the same way that he had this those four
0:21:11 years to prepare for this new administration and is doing things obviously very differently
0:21:16 and in some ways getting higher marks, his approval is up, his approval on immigration.
0:21:18 That’s the only area that he is above water.
0:21:20 And I want to get into talking about that.
0:21:23 But, you know, the American public seems to be broadly behind him in that.
0:21:30 So I always appreciate how quickly you can get to the points that you want to make as someone
0:21:31 who tries to do this for a living.
0:21:33 I’m always like, I should be more like Kellyanne.
0:21:34 I could get there faster.
0:21:44 But before we get off of SignalGate, do you feel that they are going to stop using this
0:21:47 app for these kinds of conversations, that there will be a lesson learned?
0:21:55 Because I do think in general that the American public is forgiving and they want to hear that
0:21:59 there has been responsibility taken and that there are going to be changes made.
0:22:04 And I know that, I mean, it was public reporting, so you could say that it was inaccurate,
0:22:11 but that apparently Susie Wiles and Marco Rubio, J.D. Vance wanted Trump to get rid of Mike Waltz,
0:22:18 that Pete Hegseth is safe in all of this, even though he was sharing the specifics in enormous detail
0:22:21 that everyone who has served has said couldn’t be anything but classified.
0:22:25 But do you think there is going to be a change of direction in terms of how they communicate
0:22:25 about these matters?
0:22:26 Perhaps.
0:22:33 But, and look, the, ideally, and this is not, and I think President Trump made this clear,
0:22:38 as did others, over the weekend, if not last week, Jessica, even ideally you’d want to be
0:22:40 in a skiff altogether physically.
0:22:40 Yeah.
0:22:41 You can’t be.
0:22:46 And so I think that when things are happening in real time and you’re trying to keep people
0:22:53 apprised, I appreciate the fact, actually, that there were 18 people, 19, unfortunately,
0:22:57 but take Goldberg off of there, that there were 18 people in the know.
0:23:02 That, that was my, that’s always been my experience as an advisor to President Trump, as his counselor
0:23:04 in the White House, is like, there is more and not fewer.
0:23:09 And I appreciate that because you should have, you know, even the Bible says there is wisdom
0:23:12 in a multitude of counselors, quite literally.
0:23:17 So I appreciate that, again, as opposed to a Secretary of Defense who has ambulances coming
0:23:19 to his house and they brush it under the rug.
0:23:20 We don’t know who’s in charge.
0:23:24 The President, the Commander-in-Chief doesn’t know his Secretary of Defense is under anesthesia,
0:23:25 is at the hospital.
0:23:33 All this is, I think I use it as an example because it’s Exhibit A of endless exhibits of how secretive
0:23:41 and furtive and just, I think, presuming that we, the people, are so stupid and unworthy of truth
0:23:44 and transparency in the last administration that this is so refreshing.
0:23:50 So you’re even asking questions that are held to a higher standard automatically because of how public-facing
0:23:56 and available and accessible President Trump and his team have been to the media, to the public, and the like.
0:23:57 I just wanted to correct one thing.
0:24:03 I may have misheard you that the report in the Wall Street Journal, you said that the Chief of Staff
0:24:06 and the Vice President and others, one of my friends, was gone?
0:24:07 Politico.
0:24:08 Oh.
0:24:09 Reported that.
0:24:10 Politico, I don’t know.
0:24:15 I had read the Wall Street Journal piece where the President had allegedly been asking people what
0:24:22 they thought, something I’m familiar with, and that folks just felt, you know, keep things as they are.
0:24:28 I know President Trump also, Mike Flynn, his first national security advisor, I was there,
0:24:34 was gone within a month of the inauguration, and I know there’s, you know, a certain sensitivity that was
0:24:35 much more serious, frankly.
0:24:40 But in any event, meaning what the President was saying, was considering, because he was
0:24:42 very nice about Mike Flynn.
0:24:47 He sent me on TV that morning, called me at 6.04 a.m. and said, who’s on TV?
0:24:51 And I said, well, we took ourselves off because, you know, of what happened with General Flynn
0:24:55 last night, and you’re going to have a press conference today at 2 o’clock on something totally
0:24:55 different.
0:24:56 You’ll be asked about this.
0:24:57 I didn’t want to get ahead of you.
0:24:58 He’s like, no, no, no, go out there.
0:25:02 So I went on some morning shows, and, you know, we weren’t saying a number of things.
0:25:08 But I just say this because remember that those who—I’ll give you this analogy.
0:25:14 Lots of people saying right now, we did not vote for Elon Musk, didn’t vote for Donald Trump
0:25:14 either.
0:25:16 So they should check themselves a little bit.
0:25:17 Same thing here.
0:25:23 Those saying, you must fire your national security advisor, just want a scalp on the wall.
0:25:26 It’s just another way to hurt President Trump, and by extension, hurt America.
0:25:34 Why, when we have these successful strikes against the Houthis, who, for whatever insane
0:25:39 reason, Jessica, and I’ve talked about it before, insane, incomprehensible reason, you’re smart
0:25:40 and you’re honest.
0:25:46 So tell us why, in the very first week, within days of being sworn in, President Biden would
0:25:51 delist the Houthis from the FTO, the Foreign Terrorist Organization.
0:25:52 This makes no sense to anyone.
0:25:53 They are foreign terrorists.
0:25:55 So Trump puts them back on.
0:25:56 We have successful strikes.
0:25:57 That’s great.
0:26:00 We also are trying to deal with this Russian-Ukraine war.
0:26:08 He’s trying to bring the rest of the hostages out and home and get peace in the Middle East,
0:26:10 some kind of deal in the Middle East.
0:26:15 So why, when all that’s happening, should the President of the United States shake up his
0:26:18 national security team because of an unintentional mistake?
0:26:24 I do think it’s a lot bigger than that, and my foundational question is about it just being
0:26:28 fully investigated in the same way that the Hillary Clinton server was or the classified
0:26:34 documents cases on either side with Biden and Trump, though that was cut prematurely short
0:26:35 by his win.
0:26:39 And to your points about the Biden administration and the, you know, withdrawal from Afghanistan,
0:26:42 they lost, right?
0:26:48 So using this example or trying to go back in time and using it as a comp, Biden-Harris lost
0:26:51 or Harris-Walls, which was the extension of Biden-Harris.
0:26:54 And the American public did largely feel the same way as you.
0:26:58 But Biden’s approval rating dropped after the Afghanistan withdrawal, and it never recovered.
0:27:02 At some points, it went even lower, I think the lowest in history.
0:27:08 Well, especially among independents, I think Biden really never recaptured any kind of footing
0:27:09 with independents.
0:27:12 Let me just say, I’m not concerned about the political consequences at all.
0:27:20 And so the fact that Biden-Harris lost because they had not one but two, uninspiring, not particularly
0:27:26 compelling or great speakers as their candidates, as their nominees, the electoral consequences,
0:27:34 that election was, gosh, 40 months, 39 months after about late August 2021, early November
0:27:34 2024.
0:27:37 So over three years, Jessica, after the Afghanistan withdrawal.
0:27:42 I’m not talking about electoral consequences or political fallout because the immediate fallout
0:27:44 in Afghanistan was what I said.
0:27:49 We left billions of dollars worth of technology and equipment at Bagram Air Force Base, which
0:27:54 I remember the late, God rest his soul, Senator Joe Lieberman had said at the time, like,
0:27:56 gee, this is something I helped negotiate, too.
0:27:59 Lots of Democrats, lots of Republicans felt Bagram was the right place.
0:28:03 You know, this was the right place to negotiate an airstrip.
0:28:09 And, you know, leaving Afghanistan in the hands of the Taliban, I mean, it just washed away all
0:28:12 the work that these three administrations had done.
0:28:16 So I just, I’m not worried about political consequences so much as what does this all mean?
0:28:22 And if we do, if we assess it that way, then we say this was a mistake.
0:28:26 It is being corrected, should not be repeated.
0:28:32 And, and most importantly, the whole, the mission was successful.
0:28:36 That I feel like every American should be able to applaud and appreciate,
0:28:40 no matter how they feel about President Trump, his national security team,
0:28:46 or the use of signal and the accidental inclusion of any reporter, by the way, let alone a hostile
0:28:46 one.
0:28:49 Yeah, well, I do have to.
0:28:55 Scott isn’t here to say it for himself, but someone who gets pulled over for a DUI has on
0:28:56 average done it 80 times.
0:28:59 So that is the larger issue here.
0:29:01 I am thrilled that the mission was successful.
0:29:05 You know, fist pump, American flag, fire emoji, all of the things.
0:29:11 I just think that we need to be more careful about this and, you know, really get to the
0:29:17 bottom of how often this is going on, especially with a group that big that doesn’t usually involve
0:29:19 Jeffrey Goldberg, but we have more to talk about.
0:29:20 So let’s take a quick break.
0:29:21 Stay with us.
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0:31:49 Okay, that email is done.
0:31:52 Next on my to-do list, pick up dress for Friday’s fundraiser.
0:31:55 Okay, all right, where are my keys?
0:31:56 Oh, in my pocket.
0:31:58 Let’s go.
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0:32:24 Oops, that was my exit.
0:32:26 Oh, well, that’s fine.
0:32:27 I’ve got time.
0:32:35 After the meeting, I gotta remember to schedule flights for our girls’ trip, but that’s for later.
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0:33:09 Yep, I’m on it.
0:33:13 I mean, that’s totally fine by me.
0:33:17 Play Celebrity Memoir Book Club.
0:33:19 I’m Claire Parker.
0:33:21 And I’m Ashley Hamilton.
0:33:24 And this is Celebrity Memoir Book Club.
0:33:29 Welcome back.
0:33:47 I want to talk about immigration, but if we can quickly touch on tariffs, because I don’t think I’ve actually heard you speak about, quote-unquote, Liberation Day, which is coming up on Wednesday, when we’re going to shake up the world trade order and make sure that Americans are, quote-unquote, treated fairly.
0:33:48 Where do you stand on this?
0:33:49 Where do you stand on this?
0:34:03 I’ve noticed that Howard Lutnick, who has been on TV a lot, has now seemingly been banned from the Sunday shows, or at least he was last weekend, probably after he made that comment about his 94-year-old mother-in-law who doesn’t care about her Social Security check.
0:34:07 But what’s your temperature on the use of tariffs?
0:34:15 Because we know the American public is not into them, and that’s strong majorities across all our polling, including the Fox poll on that one.
0:34:18 69% said it’s going to make products more expensive for us.
0:34:21 It’s by far and away Trump’s weakest point.
0:34:24 So where are you on the tariffs?
0:34:25 Well, a few things, Jessica.
0:34:34 First of all, Secretary Lutnick, the Secretary of Commerce, was also given in his portfolio almost immediately and certainly publicly by President-elect Trump trade as well.
0:34:47 So we have the USTR trade representative, Jameson Greer, served all four years as chief of staff to the US trade representative, Bob Lighthizer, Ambassador Bob Lighthizer, in the first term, very seasoned, very experienced.
0:34:49 Lutnick was—
0:34:52 I think that was the JG that was supposed to be in the chat, by the way.
0:34:55 The Jeffrey Goldberg was the Jameson Greer.
0:34:55 It could be Jameson Greer.
0:34:55 Yeah.
0:34:56 I read that.
0:34:58 That makes some sense, yes.
0:34:59 Yeah.
0:35:09 And so I say this because Lutnick, you know, continues to be a very key player in this administration, along with Secretary Besant and others with respect to tariffs and trade.
0:35:11 Now, here’s the thing with tariffs.
0:35:20 Every Secretary of the Treasury, from Alexander Hamilton to Scott Besant, should—not that they all would, but they should admit, acknowledge that the main purpose of tariffs is twofold.
0:35:23 One is to raise revenue for this country.
0:35:30 And the second is to protect vital American industries and its workers and, really, America and American security herself.
0:35:35 And national security piece of this is very much on President Trump’s mind.
0:35:39 President Trump has added a third rationale for tariffs.
0:35:53 It is either, Jessica, to compel or incentivize transformative changes in behavior by countries or companies or collections of countries—EU, I’m looking at you—on matters that either affect goods and services.
0:36:06 For example, let’s rebalance this export-import, non-reciprocal, unfair, imbalanced trade relationship on automobiles, on spirits, on other goods and services.
0:36:15 But when President Trump started the tariff conversation in November, pre-Thanksgiving, it was about Mexico and Canada.
0:36:17 And I want you to avoid tariffs.
0:36:21 You must get your, quote, criminals and drugs out of our country.
0:36:29 President Trudeau, lately, of the prime ministership of Canada, ran down to Mar-a-Lago to meet with the president.
0:36:37 President-elect Claudia Sheinbaum, the fairly newly elected at that time Mexican president, called the president several times.
0:36:38 They had conversations.
0:36:47 But fast forward, in office, when President Trump threatened it again, or not even threatened, stated it again, not as a negotiating tool, but as a tool in and of itself.
0:36:58 Lo and behold, both Canada and Mexico find 10,000 robust, fully trained, healthy males to go on the front lines and help with border security.
0:37:01 Each of them comes up with a billion or more, with a B.
0:37:08 And in the case of Canada, they come up with a fentanyl czar to help with that.
0:37:18 But since I was the point person for the drug crisis in the first term in the White House, I will tell you, 1% is 50% too much, because that represents a lot of death and destruction in our nation.
0:37:33 And then, of course, the Mexican president, who seems to be forging a decent working relationship with President Trump, Jessica, she also, you know, is doing more to work with our border control and other national security team members, components.
0:37:34 So that’s all working.
0:37:36 I would just say this.
0:37:47 My favorite T-shirt of the winter was, that had to do with politics and governance was, I survived the global trade war, February 3rd, 2025, to February 3rd, 2025.
0:37:51 That was roughly nine weeks ago or 10 weeks ago or so.
0:37:57 And it was, it was, everybody freaked out the weekend before, this, that, and the other is going to happen.
0:37:57 He can’t do this.
0:37:58 It’ll explode prices.
0:38:03 And it didn’t last that long because people sort of either negotiated or capitulated.
0:38:06 You can see whatever, you can use whatever term you want, depending on the circumstances.
0:38:11 Donald Trump would also tell people, President Trump would tell people, Jessica, tariffs are your choice, not his.
0:38:15 That if you want to avoid tariffs, start making more here.
0:38:21 So Mercedes-Benz says that they are the largest net exporter in the whole state of Georgia.
0:38:22 I’m like, wow.
0:38:24 I had to read it three times.
0:38:24 Really?
0:38:27 They’re the, they make a lot of Mercedes there, but they’re net exporters.
0:38:32 They’re making Mercedes in the United States of America and exporting them somewhere else.
0:38:46 Same thing with Toyota, BMW, you saw the deal that the leader of Hyundai made with Governor Landry, Jeff Landry, at the White House last week, announcing more.
0:38:52 So you can’t stand up a new factory or a facility tomorrow, but you sure the heck can have a blueprint that’s real.
0:38:55 And you can also take advantage of something else.
0:39:04 President Trump in mid to late September was at a Georgia town hall, and it was about manufacturing, and he was flanked by two banners, Jessica.
0:39:09 One said made in the USA, and the other one said 15% corporate tax rate.
0:39:14 Now, when Donald Trump got there, when we were there eight years ago, the corporate tax rate was 35%.
0:39:15 Thank you.
0:39:22 President Obama with the Nobel Peace Prize, it wasn’t for taxes, I guess, 35%, which had led to 100 corporate incursions.
0:39:32 That’s U.S.-based companies legally parking their wealth and their headquarters overseas because they literally can’t afford to do business in the U.S. of A.
0:39:34 Those corporate incursions were reversed.
0:39:38 We repatriated billions of dollars and trillions that had been parked legally overseas.
0:39:48 The corporate tax rate went from 35%, the highest in the OECD at the time, to 21%, lower than the OECD average of 23%.
0:39:53 Now, here comes President Trump saying, well, you can get 15% corporate tax rate.
0:39:55 Lots of corporations say, how do I do that?
0:39:57 Read Banner One, made in the USA.
0:40:06 He has since said, if you, if your company wants to invest $1 billion, and most of these companies are investing many billions, or could and should,
0:40:15 If you invest $1 billion, President Trump’s team will give you the white glove treatment, and you will, they will accelerate permitting and approval processes.
0:40:18 He has said this publicly in social media posts, and he has said it since.
0:40:23 So, there are ways to avoid tariffs without whining about higher prices.
0:40:25 You’ve got to make more in this country.
0:40:27 And tariffs is a long-term play.
0:40:29 I think nobody should be surprised.
0:40:33 Build the Wall 2016 is like tariffs and trade 2024.
0:40:35 He promised to do this.
0:40:43 It’s about American investment, American manufacturing, American jobs, American industry, American national security, and America herself.
0:40:44 This is a long-term play.
0:40:44 Last point.
0:41:02 This country knows, and every smart, honest Democrat knows, that we had persistent, punishing, high prices on almost everything, including basics, like fuel and groceries, for four years.
0:41:04 And we didn’t have these tariffs.
0:41:13 So, folks know that poor economic policy coming out of a White House, or Washington, D.C. at the time under Biden-Harris, leads to higher prices.
0:41:29 They’re giving—I think they’re more likely to give Trump the space and the grace for a while longer to get us back to the 2019 levels of wage growth, of job production, of interest rates, and of that rising tide lifting all boats pre-pandemic.
0:41:34 You did say build the wall, but the wall didn’t get built.
0:41:38 So, maybe the lesson is that the tariffs just aren’t going to happen, because you’re right.
0:41:41 February 3rd, they were coming on, and then they were taken off.
0:41:44 And Claudia Sheinbaum basically repackaged something that was already happening.
0:41:50 Those troops were promised under the Biden administration, and as you mentioned, any death from fentanyl should never happen.
0:41:53 But fentanyl is not our problem with the Canadians.
0:41:57 And Trump was the one who negotiated the USMCA, if he has such huge problems with it.
0:42:02 But my concern is for the American public.
0:42:04 They know that this is going to hurt them.
0:42:09 We’ve heard from Peter Navarro, Secretary Lutnik, et cetera, that there would be some short-term pain.
0:42:12 Even President Trump has said it, and J.D. Vance has said it.
0:42:23 And I don’t know if the American public deserves that when they, you know, took a big leap of faith, a lot of these voters, and went with Trump, people who were traditionally Democratic voters or might have sat out.
0:42:29 And they thought that their lives were going to get economically better on day one, because that’s what they were promised.
0:42:33 And tariffs, I’m not saying they can’t be used.
0:42:38 Obviously, we kept the China tariffs that Trump implemented under Biden, even extended them, I think, threefold.
0:42:46 But it’s a very risky gamble for this grand bargain that he’s going after, the Mar-a-Lago Accords or whatever we’re going to end up having.
0:42:52 I think with Trump, you also have to price in other macroeconomic factors when it comes to tariffs.
0:43:06 So, again, if we can balance the whole trade relationship on specific categories of goods and services, Jessica, as goes other countries or collections of countries and even some companies, that’s going to help.
0:43:18 If they extend, if not expand, the Tax Cut and Jobs Act from 2017, which we’ve all been living under, whether people realize it or not, if you lose some of those benefits, you’re going to feel it.
0:43:31 So, if that gets extended and expanded, that, like, no tax on tips, no tax on Social Security, et cetera, then, and even the ECCA, the Educational Choice for Children Act, that President Trump has clearly said he wants to be part of reconciliation.
0:43:36 I have no idea to this moment, zero, how Democrats can be against school choice.
0:43:48 I have no idea why we’re trapping kids of all backgrounds in some of the failing schools when their parents can exercise a choice as to where they go to school and what is taught there.
0:43:50 So, there’s a lot going on in reconciliation.
0:43:52 I think you also have to price in the de-reg agenda.
0:43:56 We had more regulation under Biden-Harris.
0:43:58 We’re going to have fewer regulation, less regulation.
0:44:01 You have to price in the energy production that’s going to happen.
0:44:05 So, I feel like there are other component parts to the macroeconomy.
0:44:06 These things take time.
0:44:11 And you said something at the beginning, which is important, and I’m going to give you a rationale for it.
0:44:17 You said something like, look, President Trump is doing things a little bit differently this time, and he’s got high marks and everything.
0:44:21 This time, he’s getting us back to where we were in 2019.
0:44:28 But he also is undoing some of the grievous, grave damage that was done in the last four years.
0:44:32 And it’s not even – they’re not even pulling things out root and branch.
0:44:41 There are some seedlings, as I’ve told them, planted above the soil that you just have to blow down, like, all these ridiculous new programs and expenditures that are mind-blowing to people.
0:44:55 I think even a smaller federal government footprint and less government spending, whatever that ends up looking like, you have to price all of that in and not just look at tariffs in – not you, everybody – in isolation.
0:44:56 Totally.
0:45:08 I’m happy to do that, and I know that there are some smart people on my side of the aisle who think that we do need the higher levels of tariffs, like the Bernie Sanders and the Sherrod Browns of the world, Tim Ryan.
0:45:23 But, you know, when I look at the larger picture – and this will get us to immigration as well – but we have a 35 percent chance, now Goldman Sachs, of going into a recession, which we did not have.
0:45:24 We have slow GDP growth.
0:45:29 Consumer confidence is falling at a rapid pace.
0:45:36 So it’s not as rosy as one would or that you were painting it, and I get it.
0:45:38 You know, progress is slow but certain.
0:45:53 But when you look at the reconciliation bill and the fact that they want to jam through these tax cuts for people, not just the high earners and what we thought of it, of people earning over $400,000, but $700,000, and they’re going to offset that with cuts to Medicaid up to $880 billion.
0:45:59 You know, that’s going to be inflationary, and that’s just like a payout also to your friends.
0:46:04 And how are you also going to avoid huge inflation with the deportations?
0:46:12 And that’s how I want to get us into this immigration conversation, because, you know, ICE is doing what ICE said that they were going to.
0:46:28 We know that it is inflationary to have, what, half the workforce that you were going to have, not just when we stop getting our goods from Canada that funds the hotel industry, you know, all our lumber, cement, et cetera.
0:46:31 But how do you square those things?
0:46:33 Deporting some of these criminals?
0:46:35 It’s more than that.
0:46:36 And you know, well, you know that it’s more than that.
0:46:54 I do want to talk about the criminal part of it and the fact that there are, at least that we know of, a few innocents that have been sent to this El Salvadorian prison camp for having tattoos that no one paid attention to, like what they actually were, like the autism awareness tattoo or a crown with mom written on it.
0:47:03 But yeah, if he does do a deportation force, which was one of his promises and certainly what Tom Homan wants, what is the outcome of that going to be?
0:47:16 Well, the outcome in many ways is to make sure that we mitigate the chances of another Rachel Morin or Jocelyn Nagourney or Lake and Riley, all of whom were murdered.
0:47:21 And the case of two of them brutally raped with where they were murdered.
0:47:31 Jocelyn Nagourney is a 12-year-old girl raped for two hours under a bridge and then murdered by two people who should not have been here who were here illegally.
0:47:34 And so that doesn’t mean everybody is like that.
0:47:35 Of course not.
0:47:38 What it means is they’re like that and they shouldn’t be here.
0:47:40 And you know what, Jessica?
0:47:51 I feel like the last four years, the biggest epidemic, even though more people died from COVID under Biden than Trump, but the biggest epidemic, certainly that we don’t discuss, is the epidemic of looking the other way.
0:47:54 Of pretending that we don’t see someone’s pain, that we don’t see what’s happening.
0:48:04 And to allow upwards of 10 million people here illegally, and then once they’re here, people can turn on Fox News, probably not much else.
0:48:15 That’s why it’s the highest rated by far of any of the cable stations, or open up their phones and see, see the same people who just got here illegally in New York City.
0:48:25 Get free cell phones, clothing, hotel rooms in New York City, cash, debit cards, your kid’s seat in a New York City classroom.
0:48:27 And people are looking at it saying, that’s not fair.
0:48:28 Oh, you’re a racist.
0:48:32 Actually, I’m an African-American 28-year-old male who says that’s not fair.
0:48:34 Where’s my cell phone upgrade?
0:48:34 Where’s my free clothing?
0:48:38 When was the last time I could take my kids to a hotel room in New York City?
0:48:44 Because I live in this condition, or I’m temporarily homeless, temporarily homeless.
0:48:46 So people just said that’s not fair.
0:48:53 And fairness over wokeness, but really over unfairness, was a huge reason why Trump got elected.
0:48:57 Strength over weakness, and fairness over wokeness slash unfairness, which is slightly different.
0:49:06 So I don’t think, there’s a reason that President Trump’s approval rating, as you said out at the beginning of your podcast, is today is highest on immigration.
0:49:09 Because he does see himself keeping the promises.
0:49:19 And some of the wall was built, Biden had to spitefully take some of that down and let the stuff rot there, because a lot was done on spite, not even ideological differences.
0:49:25 But the premise is the same, which is it all got worse in the last four years.
0:49:42 And all of a sudden, Jessica, an issue that was mired in low single digits, illegal immigration, border security, mired in low single digits, and trade and tariffs was hardly even an asterisk in our polling and everybody else’s polling 10 years ago.
0:49:45 An asterisk means less than 1% mentioned as most important problem.
0:49:53 10 years ago, right about now, when a guy named Donald J. Trump said, I’m going to run for president, but here’s what I’m going to talk about.
0:49:58 He elevated these issues into the national consciousness to international criticism and ridicule.
0:50:02 His company lost contracts and his name on buildings.
0:50:03 Oh, my God, look what he’s doing.
0:50:17 And fast forward, the fall of 2024, thanks to his first term and Biden’s only term, that immigration, border security was now the number two issue in all seven swing states and in all the national polling.
0:50:24 It had risen that high because people started to see for themselves that they live in a border state no matter where they live.
0:50:28 So I feel like, again, talking about space and grace, people will give it.
0:50:42 And if there are folks who are unfairly, unnecessarily swept up in some of this, they will do, I’m sure that they are doing, probably free counsel from some of these groups, they will make a claim about that.
0:50:45 And that will be adjudicated more likely than not.
0:50:46 But I wanted to say something else.
0:50:50 You know, these students, well, the guy’s 30 years old.
0:50:55 He lives in university housing at Columbia, but he was a graduate student there a while ago, I guess.
0:50:57 The 30-year-old who wants to-
0:50:58 Mahmood Khalil.
0:51:00 Yeah, wants to be a poster child.
0:51:06 And the other one, I think she’s at Columbia, but she, you know, she’s another one.
0:51:09 She’s here since she was seven, et cetera, complaining.
0:51:30 If you read, you know, what you have to do if you’re here on a student visa, I mean, this is, you know, if you look at student visa, if you look at criminal activity, national security, public safety concerns, revocation of visa, you know, it says the State Department can revoke a student visa at its discretion, often without prior notice, if it believes a student’s presence conflicts with U.S. interests.
0:51:35 And I think that Marco Rubio, our Secretary of State, is making that very clear.
0:51:41 He said recently, quote, every day I find another one of these lunatics and revoke their visa.
0:51:42 What are they doing?
0:51:43 Well, we see what they’re doing.
0:51:55 The same two eyes that sees the debit cards, cell phones, cash, clothing, hotel rooms, your kid’s seat in the New York City classroom, sees these folks, they’re so bold, they’re wary, they’re all masked up, so we can’t see them.
0:52:01 We see them protesting, I think, inciting violence, making people feel uncomfortable.
0:52:08 I know students at Columbia right now as we speak, and they feel uncomfortable, and the Jewish ones feel completely uncomfortable.
0:52:10 They feel threatened, threatened.
0:52:17 Nobody should, that should not be an occupational hazard of being at Columbia or any other campus in this country.
0:52:23 And so if you look at the national security or public safety concerns, a lot of this could fit under there easily.
0:52:43 You know, the Trump administration’s current stance, as articulated by Secretary of State Rubio, has expanded this national security and public safety concern to target students, you know, to cover students involved in some of these anti-Semitic, anti-Israel activism, you know, citing some foreign policy implications.
0:52:55 But I just can’t believe anybody can argue the fact that these kids can’t go to campus, they miss their final exams, they have to, you know, shelter in place in their dorms because you’ve got some of these folks.
0:52:58 And then what did their big, bold acting president do?
0:53:07 Not to be confused with the former president of Columbia University, who also resigned, but the new acting president resigned because she capitulated to President Trump.
0:53:11 All of a sudden, her favorite color is not red or blue, it’s green.
0:53:23 And she’s so worried about losing the $400 million in federal funding that we fork over to Columbia University so that we can see this nonsense on the campus that she capitulated about a mask mandate.
0:53:25 It’s fascinating to watch.
0:53:28 It’s not just the tech companies given to the president’s library.
0:53:35 It’s not just the big law firms, big law that was against him a year ago and for the preceding seven years.
0:53:41 It is giving hundreds of millions of dollars in pro bono work to issues he cares about.
0:53:44 I hope the drug crisis is one of them, and veterans and school choice.
0:53:49 Those are great causes for a big law to fund if they can’t see their way to fund it themselves.
0:54:08 And now you have university presidents who were allowing this to happen, who were greenlighting it, who Elise Stefanik, at the time the number three in the House of Representatives, she just embarrassed them into oblivion in the case of two or three of them because they’re lying under oath.
0:54:13 They don’t know if anti-Semitism is anti-Semitism when the rest of us do.
0:54:25 And so I think there’s a lot going on here, but if you actually read the student visa piece, there is a lot of latitude for the country.
0:54:34 If you feel like somebody who’s here on a student visa, which is a privilege, by the way, not a right, not a right, then there’s a lot of latitude for this administration.
0:54:36 Yeah, understood.
0:54:41 Mahmoud Khalil is here on a green card, which is a much higher threshold than just a student visa.
0:54:45 And the student that you’re referring to from Columbia, I believe her first name is Chung.
0:54:48 She’s been here since she was seven from South Korea.
0:54:55 So and I think at least based on the reporting that I’ve seen that she just participated in a in a sit in.
0:55:02 And now we don’t her lawyers know where she is, but we we don’t know where she is at this point.
0:55:06 And I’m you know, I was very outspoken about the protests on campus.
0:55:10 I did think that the university presidents were clearly not doing enough.
0:55:22 And if you had slotted in any other protected class for Jew, this never would have been allowed to proliferate if you had been blocking trans kids or black kids from going to classes or going to Chabad.
0:55:37 But it does feel like this administration is really overreaching in terms of regulating the First Amendment, which is something that they claim to be celebrating during the campaign and try to make it out like we were the party that couldn’t take it.
0:55:40 That couldn’t listen to people who have divergent viewpoints.
0:55:45 And I’m concerned about that and I’m concerned about how they’re going after big law firms.
0:55:56 And some of these law firms that they’re targeting are just guilty of, you know, representing people with cases that the Trump administration didn’t like or having anything to do with Jack Smith.
0:56:06 And I think the ones that are capitulating, as you said, offering $40 million, $100 million of, quote unquote, pro bono work are just kind of laying down for Trump.
0:56:13 And I’m glad to see that there are other law firms that are standing with the Perkins cooies of the world and standing up to them.
0:56:15 We have one more topic, though.
0:56:16 We got to take a quick break.
0:56:17 Stay with us.
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0:57:45 Today Explained here with Eric Levitt, senior correspondent at Vox.com, to talk about the 2024 election.
0:57:46 That can’t be right.
0:57:48 Eric, I thought we were done with that.
0:57:49 I feel like I’m Pacino in three.
0:57:53 Just when I thought I was out, they pulled me back in.
0:57:55 Why are we talking about the 2024 election again?
0:58:05 The reason why we’re still looking back is that it takes a while after an election to get all of the most high-quality data on what exactly happened.
0:58:09 So, the full picture is starting to just come into view now.
0:58:17 And you wrote a piece about the full picture for Vox recently, and it did bonkers business on the internet.
0:58:18 What did it say?
0:58:19 What struck a chord?
0:58:25 Yeah, so this was my interview with David Shore of Blue Rose Research.
0:58:31 He’s one of the biggest sort of democratic data gurus in the party.
0:58:36 And basically, the big picture headline takeaways are…
0:58:49 So, we want to introduce you to another show from our network and your next favorite money podcast, for ours, of course.
0:58:54 Net Worth and Chill hosts Vivian Tu as a former Wall Street trader turned finance expert and entrepreneur.
0:59:00 She shares common financial struggles and gives actionable tips and advice on how to make the most of your money.
0:59:07 Past guests include Nicole Yoder, a leading fertility doctor who breaks down the complex world of reproductive medicine and the financial costs of those treatments.
0:59:12 And divorce attorney Jackie Combs, who talks about love and divorce and why everyone should have a prenup.
0:59:16 Episodes of Net Worth and Chill are released every Wednesday.
0:59:19 Listen wherever you get your podcasts or watch full episodes on YouTube.
0:59:21 I absolutely love Vivian Tu.
0:59:22 I think she does a great job.
0:59:27 Welcome back.
0:59:31 I’m still here with Kellyanne, who has been so gracious with her time.
0:59:41 I think this is probably going to be your favorite conversation because I’m opening myself up to democratic criticism, or at least I’m inviting it, versus you’re always good at getting it, even when I don’t ask for it.
0:59:44 But we’re only two months into the administration.
0:59:52 I would love, I mean, it sounds like you do think that it has been going really well thus far, and Democrats are scrambling.
0:59:54 We know this, especially, I think, on the Senate side.
0:59:57 In the House, I think Hakeem Jeffries has been doing a good job.
1:00:04 But, you know, where do you think things stand in terms of the Democratic reboot or what we have to do?
1:00:12 The New York Times editorial board was out this weekend with an op-ed that basically said that Democrats are in denialism of the message from 2024.
1:00:21 And then I also want to get your take, and maybe actually do this one first, on what life after Trump looks like for the Republican Party.
1:00:28 He called Kristen Welker over the weekend and basically said that a third term was a possibility, that there are methods to do it.
1:00:36 But for the purpose of this conversation, you know, let’s say that he is going to leave office when his term is up.
1:00:38 Where do you think the Republican Party goes?
1:00:45 It’s a great question, and I think we got a couple tea leaps about it, Jessica, in the 2024 down-ballot elections.
1:00:56 So President Trump swept all seven swing states, and along with him, Republicans flipped United States Senate seats in Pennsylvania and Ohio,
1:01:03 defeating long-term Democratic veterans who were winning by double digits in their re-elections.
1:01:08 Previously, Sherrod Brown in Ohio, Bob Casey Jr. in Pennsylvania.
1:01:11 In addition, flipping the John Tester seat in Montana.
1:01:21 However, in four of the swing states that President Trump carried, Arizona by six points, Nevada handily, Wisconsin, Michigan, much smaller margins,
1:01:25 those four Republican Senate candidates came up short.
1:01:34 And whereas President Trump was overly unfairly blamed for the midterm losses or the lack of a red wave in 2022,
1:01:38 in 2024, he basically was a gift to all of these candidates.
1:01:49 He’s got strength at the top of the ticket, and all that means, plenty of money, plenty of personal visits inside the state by the nominee, President Trump,
1:01:54 plenty of juice for these candidates, endorsing them, helping them, and yet they came up short,
1:02:04 which tells you something about the difference between Trump’s strength within the electorate and some and all of the Republicans not named Donald J. Trump.
1:02:09 So that’s a little view into the future, a recent one.
1:02:16 And then we’ll see what happens on Tuesday, on April 1st, with these special elections in a couple of Florida seats.
1:02:20 I actually think, I hope those Republicans win and we keep the seats.
1:02:26 I actually think if they don’t, it’s not, everybody’s going to rush and say the same thing as the lemmings always do.
1:02:32 Oh my God, it shows that Trump’s not popular, he doesn’t have the juices, administration’s over, signal, signal, signal.
1:02:34 I actually think it’s the opposite.
1:02:39 It shows what I just said yet again, which is, if you’re not him and you’re not at the top of the ticket,
1:02:45 then there’s something special about him where people gravitate toward him, turn out for him,
1:02:52 whether it’s at rallies, whether in the bleeding sun or the pouring rain for days to wait just to see him and be part of it.
1:02:55 That’s something that the party will need to grapple with.
1:03:04 I don’t think we’re going to go back to being this sort of globalist, amnesty, maybe some higher taxes,
1:03:13 maybe not a lot of D-reg, maybe Beba, restrain this, restrain that kind of party that was a losing model for Mitt Romney, for John McCain.
1:03:20 I think that along with Ronald Reagan, 1980, Newt Gingrich and the contract with America, 94, Trump, 2016,
1:03:30 those are the three most transformative party-changing, coalition-shifting elections in my lifetime and so in many of our lifetimes.
1:03:34 So I feel like he’ll still have his mark on the party.
1:03:36 There is no obvious heir apparent.
1:03:42 Obviously, his vice president would have a good chance, but the president himself said he’s not endorsing Vice President Vance or anyone else right now,
1:03:45 which is smart because he needs to do a lot of stuff.
1:03:47 You can’t talk about politics in 2020.
1:03:48 You’ve got to do policy in 2025.
1:03:50 So that’s smart.
1:03:55 On the Democratic side, I think it’s the worst I’ve seen the Democratic Party in a very, very long time.
1:04:03 It just seems rudderless, shiftless, overly angry, without direction, probably a lot of internal fighting that we don’t even see.
1:04:10 And it’s, you know, in any 12-step program, Jessica, even if you reduce it to eight, nine, or expand it to 20 steps,
1:04:13 the first one must be acknowledgement.
1:04:16 And I haven’t seen that yet, let alone getting to acceptance.
1:04:22 I haven’t seen acknowledging the fact that Kamala Harris had everything she wanted.
1:04:25 stop with the, she only had 100 days or whatnot.
1:04:27 What would she have done on day 108 or 109?
1:04:28 Same stuff.
1:04:37 I mean, she had all the king’s horses, all the king’s men, the mainstream media, academia, plenty of money, excitement, history on her side, etc.
1:04:39 Making history on her side.
1:04:41 That wasn’t the right model.
1:04:58 And I think even some of these governors and folks in the House or Senate who could be rising up as Democratic spokespeople are physiologically incapable of answering a question or declaring a sentence without saying Trump, Trump, Trump four times in it.
1:05:08 So unless and until somebody can get him out of their mind and stop pretending that the best antidote to Trump is anti-Trump, that’s just not it.
1:05:19 But until the party, you know, the Democratic Party, the worst thing that’s happened to it, in my view, is ceding, C-E-D-I-N-G, some of these core Democratic constituencies to President Trump.
1:05:25 So he won more Jewish Americans, more women than he than he should have against a female candidate.
1:05:26 I agree.
1:05:27 People.
1:05:30 He won more Hispanics, African-Americans, union households.
1:05:32 He won more political independence.
1:05:34 And this was the election, Jessica.
1:05:37 This is what the Democrats, I think, don’t seem to grasp yet.
1:05:42 2024 at the presidential level marked the election where Americans said, that’s it.
1:05:43 I’ve had enough.
1:05:49 No more will you tell me who I am, what to think and how to vote based on my age, my gender.
1:05:58 My race, my religion, my union membership, whether I’m married or not, whether I have kids at home or not, my sexual orientation.
1:06:03 I mean, all of the, and even my political registration and or my past voting preferences.
1:06:08 People are like, excuse me, this is the one time when I can exercise my own judgment, make my own choices.
1:06:16 And I’m going to do that irrespective of Barack Obama wagging his finger at young African-American men and saying, I’m telling you to do this.
1:06:18 You got to do this for me.
1:06:25 And then goes back to his compound in the golf course or in Martha’s Vineyard or whatnot, which he’s welcome to have.
1:06:31 But then you can’t wonder, though, why the Obama coalition in 2012 is now Trump country.
1:06:37 And if you look at the migration of voters from Obama 12 to Trump 2024, it is nothing but startling.
1:06:42 The Democratic Party I grew up around, half Irish, half Italian, a house full of women.
1:06:49 My father left, you know, feminist movement, Roe versus Wade movement, women in the workforce, including my own mom, reluctantly movement.
1:06:57 You had every man in my every man in my family to this moment is in a is in a union, a private trade.
1:07:17 That Democratic Party looks so distant now and it’s just been subsumed by this odd stew of liberal overreach and academia and Hollywood and media and frankly, just losing touch with, if not outright ridiculing people who work for a living, people who don’t have fancy degrees.
1:07:22 And most of this country is that and most of the Democratic Party right now is not.
1:07:27 Yeah, listen, I’m not one of the ones who’s in denial about what happened.
1:07:30 And I think there’s a lot of truth to what you were saying.
1:07:39 But if Donald Trump is the guy, right, he is the heart and soul of this party and he will not be on the ballot in 2028.
1:07:43 I’m going to mark you down for the he knows that he has to go category.
1:07:43 Right.
1:07:44 I didn’t say that.
1:07:45 I just said that.
1:07:47 Well, Kelly, yes, that I.
1:07:50 He’s listen, there’s he hears that from other people.
1:07:51 That’s nice.
1:07:54 I mean, crazy people talk to all of us.
1:07:56 I mean, the entrance on the exit.
1:07:56 Well, it also comes.
1:07:57 But you’re not a.
1:07:58 I mean, you were.
1:08:00 People didn’t vote for him the first two times, Jessica.
1:08:01 I think you mentioned some of them earlier.
1:08:08 But you were I mean, you were a standout in 2020 amongst people who were close to him who never bought into the big lie.
1:08:12 You said, Mr. President, you lost the election and, you know, you got to move out.
1:08:17 So are you saying the door is open to a third term?
1:08:20 No, I’m saying that when there’s talk of it again, when your colleagues in the media.
1:08:24 This is him on the phone with Kristen Welker.
1:08:25 I’m not.
1:08:26 This isn’t colleagues in the media.
1:08:27 It’s in his own voice.
1:08:30 Well, but again, he’s hearing that from people.
1:08:31 There’s so what?
1:08:34 I’ve heard that I’m the most beautiful woman in the world.
1:08:35 I know it’s not true.
1:08:36 Sure you are.
1:08:37 Definitely.
1:08:37 Thank you.
1:08:39 You’re a good friend.
1:08:40 But come on here.
1:08:40 Absolutely.
1:08:45 But no, I think it’s beside the point right now when he’s got too much to do.
1:08:51 But it does tell you one thing, that no matter, you know, assassin’s bullet, all these indictments,
1:08:59 court cases, impeachments, everything else, 2020, et cetera, January 6th, and so on and so
1:09:06 forth, that President Trump is seen as a guy who can overcome all that and have a critical
1:09:11 mass, in this case, many, tens of millions of Americans, highest ever for a Republican
1:09:14 in many ways, focus on him and vote for him.
1:09:17 I think it shows you, and it wasn’t for lack of trying.
1:09:21 I mean, one of the biggest mistakes the Democrats made, in my view, I’m glad they made it, but
1:09:27 in 2023 and 2024, was sort of dismissing all types of Democratic primary opponents against
1:09:32 President Biden, including one RFK junior, now the secretary of HHS under a Republican
1:09:33 president, Trump.
1:09:39 I think the lack of primaries hurt, and I was a huge voice, often criticized within my own
1:09:41 party for saying this about my Republican Party.
1:09:46 This nonsense of clearing the field based on electability, thank God I haven’t heard the
1:09:52 word electability in a very long time, and that’s important because this whole matter that you
1:09:57 rob the people of their voice and their choice months, if not years before an election, is folly.
1:10:00 Let the people decide, and it wasn’t for lack of trying.
1:10:06 Gosh, eight, nine, I don’t know how many, many Republicans ran for president in 2024, as did
1:10:13 President Trump, and he won decisively, embarrassingly, in all of their states, beating them handily.
1:10:17 So he’s sort of earned this, but I think that it’s not so-
1:10:19 Well, he hasn’t earned the right to violate the Constitution.
1:10:20 No, no, no, no, I didn’t say that.
1:10:24 I said he’s earned, no, no, no, I said he’s earned the presidency now, meaning he-
1:10:24 Right.
1:10:26 No, no, no, please don’t misquote me.
1:10:28 I haven’t said anything about that.
1:10:29 I believe in the Constitution.
1:10:33 The president knows that presidents are term-limited.
1:10:34 He is hearing from everything.
1:10:35 Two terms.
1:10:36 What can we do about that?
1:10:37 You know, blah, blah, blah.
1:10:37 No.
1:10:38 He’s going to focus on policy.
1:10:39 Nothing to do.
1:10:39 See?
1:10:41 But I just want to say this about it.
1:10:48 It does tell you that he’s got more of, he’s got much more prominence in the Republican
1:10:51 Party and the conservative movement, which is different than the Republican Party.
1:10:55 People always trying to criticize him and tear him down with, oh, it’s just a base, a base,
1:11:00 a base, like these dopes, nepo babies on the left who now consider themselves reporters.
1:11:01 And you know who I’m talking about.
1:11:03 They’re probably watching now.
1:11:05 I know so much Trump and his base.
1:11:06 What base?
1:11:06 It’s a base plus.
1:11:08 The guy won all seven swing states.
1:11:09 He won the popular vote.
1:11:11 It’s base plus, plus, plus, plus.
1:11:13 I say this for a very simple reason.
1:11:19 The Democratic Party, for whatever else, I think still could rely upon one Barack Obama and occasionally
1:11:23 his wife, although we see her pop up every four years to come to a convention and criticize
1:11:26 Trump and now on a podcast to insult her husband.
1:11:34 But we don’t, you know, the Obamas, the Clintons, you could always count on a few super popular
1:11:40 stand-the-test-of-time Democrats to raise money, to raise hackles, to get out there and do stuff
1:11:41 for the party.
1:11:42 I don’t think that’s true.
1:11:47 I think, if anything, the rising people in your party, Jessica, and the Democratic Party
1:11:49 are scary socialists.
1:11:53 You know, Bernie Sanders has 15,000 people in Arizona recently.
1:11:54 Elizabeth Warren’s always on the rise.
1:12:00 AOC and the squad that doesn’t do squad, as Nancy Pelosi said, quote, she said, and I’ll
1:12:03 quote Nancy Pelosi, quote, this glass of water could have won in their districts.
1:12:08 Really, I think, going roughshod on the squad at the time, saying they’re all in safe seats.
1:12:10 How could they have not won?
1:12:15 And so there’s just a lot of generational tension, ideological tension.
1:12:20 I think the difference between do we go back and try to recapture the working class of America
1:12:25 versus are there enough elite, effete, like us in the Democratic Party in the hierarchy
1:12:26 to win elections.
1:12:32 There’s so much hand-wringing, white-knuckle hand-wringing now of everybody so nervous in the
1:12:36 Democratic Party, where I think the answers are pretty simple, which is you can’t tell people
1:12:40 who they are, how to think, and how to vote, and what’s good for them.
1:12:45 They need to tell you that is, as you know, that’s polling 101, that’s voting 101, it’s
1:12:46 politics 101.
1:12:49 People have a funny way of telling you what’s important to them.
1:12:50 You can’t tell them.
1:12:53 But as for this, it’s just another way of, oh, look at Donald Trump.
1:12:54 He wants to be president for life.
1:12:56 He’s hearing that from other people.
1:12:57 He respects the Constitution.
1:13:05 But there’s no question the most important person in 2026, in the midterms, and 2028 is
1:13:05 Donald J. Trump.
1:13:07 Okay.
1:13:08 We’ve got to leave it there.
1:13:12 And if we talk more, I want to talk about Josh Shapiro and Wes Moore, because they are not
1:13:14 Democratic socialists, and I think they’re doing a pretty good job.
1:13:16 But I take all the criticism.
1:13:19 I’m into the South flagellation about what happened.
1:13:23 I want to thank you, especially Kellyanne, for being here with me, and everyone for listening
1:13:24 to Raging Moderates.
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1:13:33 Its own feed.
1:13:37 Exclusive interviews with sharp political minds you won’t hear anywhere else.
1:13:40 This week, I’ll be talking with Senator Brian Schatz from Hawaii.
1:13:43 Make sure to follow us wherever you get your podcasts so you don’t miss an episode.
1:13:46 And thank you for being here, Kellyanne.
1:13:47 I really appreciate it.
1:13:48 Thanks for having me.
1:13:48 Yeah.
1:13:49 I’ll see you at work.
1:13:51 That’s right.
1:13:52 Take care.
1:13:53 You too.
1:13:53 Thank you.

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0:00:51 Have you noticed that headlights seem brighter these days?
0:00:53 It’s more than just a nuisance for some people.
0:00:56 Those headlights and other LED lights
0:00:58 knocked me out of being a teacher.
0:00:59 I just, I couldn’t get to work anymore
0:01:02 without suffering these impacts,
0:01:04 these neurological, psychological impacts.
0:01:07 The dark side of those gleaming headlights.
0:01:10 That’s this week on Explain It To Me.
0:01:12 Listen every Sunday morning,
0:01:13 wherever you get your podcasts.
0:01:17 Hey, Prof G listeners, it’s Ed.
0:01:18 If you’re hearing this message,
0:01:20 it’s because you’re still listening
0:01:21 on the Prof G pod feed,
0:01:23 which means you’re actually missing
0:01:26 half of our episodes on Prof G Markets.
0:01:28 So for all of that content,
0:01:30 head over to the Prof G Markets podcast,
0:01:33 not the Prof G pod, Prof G Markets,
0:01:34 and hit follow.
0:01:36 We’ve also left a link in the description
0:01:37 to make it easier.
0:01:38 Thank you,
0:01:40 and I’ll see you on the other feed.
0:01:44 Today is number 1461.
0:01:45 That’s how many beers there are
0:01:47 in a Canadian brewery’s presidential pack,
0:01:49 offering one beer for every day
0:01:50 of Trump’s presidency.
0:01:52 Ed, what’s the difference
0:01:53 between America and Canada?
0:01:54 What’s the difference?
0:01:56 America has really nice neighbors.
0:02:08 I’m very pro-Canada.
0:02:09 I’m feeling very Canadian.
0:02:10 I’m feeling super Canadian.
0:02:11 Actually,
0:02:13 I don’t know if you know this,
0:02:16 but Canada both passed
0:02:17 same-sex marriage
0:02:19 and now marijuana,
0:02:20 which means actually
0:02:22 they’re interpreting the Bible correctly.
0:02:24 Leviticus 20, 13.
0:02:26 If a man lies with another man,
0:02:27 he should be stoned.
0:02:31 That’s good.
0:02:32 That is good.
0:02:33 I like that joke.
0:02:35 That’s clever and historical.
0:02:36 It’s time for banter.
0:02:37 What’s going on in your life?
0:02:38 I’m doing okay.
0:02:40 I woke up with a bit of a cold this morning,
0:02:41 which isn’t ideal,
0:02:43 but otherwise doing quite well.
0:02:44 You sound fine.
0:02:44 You sound good.
0:02:45 Sound fine.
0:02:45 That’s good.
0:02:46 Okay.
0:02:46 Okay, enough of that.
0:02:47 Back to me.
0:02:47 So last night,
0:02:50 so I don’t know if you’ve heard,
0:02:52 but Chiltern Firehouse has burned down.
0:02:53 So daddy needs,
0:02:54 and by the way,
0:02:56 I’m pretty sure that I owe,
0:02:58 I think I told you this,
0:03:00 I was borderline hypertensive,
0:03:01 which means I almost had high blood pressure.
0:03:02 I was 140 over 80.
0:03:05 And I uploaded all my results,
0:03:06 my urine,
0:03:07 my blood,
0:03:08 all this shit,
0:03:09 and basically everything came back.
0:03:11 And I uploaded it into chat GBT,
0:03:12 and it said,
0:03:12 okay,
0:03:12 dumb shit,
0:03:13 drink less.
0:03:19 And so I just did my blood pressure last night,
0:03:22 and it’s 127 over 74 or something,
0:03:23 which means I’m back to,
0:03:23 you know,
0:03:26 the fucking rock star superhero I’ve always been.
0:03:29 And I was trying to figure out what’s changed,
0:03:32 and I’m convinced that my blood pressure
0:03:33 has come down 13 points
0:03:35 because Chiltern Firehouse has burned down.
0:03:38 I would go there twice a week.
0:03:40 I’d have four to five makers in ginger.
0:03:43 So that’s 10 makers in ginger.
0:03:45 Four to five each trip?
0:03:45 Yeah.
0:03:45 Oh, yeah.
0:03:46 Daddy goes deep in the pain.
0:03:47 Oh, wow.
0:03:48 I told you I’m a better version of me,
0:03:48 a little bit fucked up.
0:03:49 You see me fucked up.
0:03:50 I’m nice.
0:03:50 No, I agree.
0:03:52 Yeah,
0:03:54 and so that’s 10 makers in ginger a week.
0:03:56 So I’m basically drinking a half a bottle of makers.
0:03:58 So I’m convinced,
0:03:59 and I’m glad no one was hurt,
0:04:02 I’m convinced the reason my blood pressure has come down
0:04:04 is because Chiltern Firehouse burned down.
0:04:05 That makes a lot of sense.
0:04:05 Yeah.
0:04:07 I’m trying to find the new place.
0:04:09 Last night I went to Soho Muse.
0:04:10 I told you about this, right?
0:04:11 Last I heard, you haven’t been yet.
0:04:12 Is this your first time?
0:04:13 I went last night.
0:04:16 So fucking Soho House decides,
0:04:19 okay, we’ve let in too many riffraff at Elson,
0:04:21 and we need a place for the players.
0:04:22 Scott Galloway.
0:04:24 Small cap player.
0:04:25 I called them, and they’re like,
0:04:28 no, we’re sending out invitations slowly to members.
0:04:29 I’m like, what the fuck?
0:04:29 I’m a member.
0:04:31 And she said, no, it doesn’t matter.
0:04:33 So anyways, I called someone who knew someone who knew someone.
0:04:34 Went last night.
0:04:35 Nice.
0:04:37 Not Chiltern, but still pretty nice,
0:04:40 and definitely like you could tell it’s sort of a little bit of another level.
0:04:43 And tonight I’m going to this place called Kensington Gardens,
0:04:46 which is, I guess, also a new hotspot.
0:04:48 So I’ll soon be hypertensive again.
0:04:49 Interesting.
0:04:51 What’s going on with your drinking?
0:04:53 Yeah, I’m not drinking that much.
0:04:55 I drank a little bit last night.
0:04:57 My friends took me out to the grill in New York.
0:04:59 Have you been to this restaurant?
0:05:03 This is like the successor to the famous Four Seasons restaurant.
0:05:04 It’s in the Seagram building.
0:05:04 Fancy.
0:05:07 So they went out and bought me a nice dinner.
0:05:08 It was very nice.
0:05:12 And they forced a martini on me.
0:05:13 So I did drink last night.
0:05:14 I didn’t really want to.
0:05:16 But, you know, I got peer pressured.
0:05:18 But beautiful restaurant.
0:05:21 I would highly recommend, yeah, the grill.
0:05:24 Apparently it’s where Bob Iger goes every lunch.
0:05:24 Oh, really?
0:05:26 To acquiesce to the Trump administration?
0:05:28 Perhaps.
0:05:30 Someone from the administration come up to me and say,
0:05:33 okay, now put your elbows on the table, you fucking coward.
0:05:35 Anyways, sorry, go ahead.
0:05:36 Go ahead.
0:05:37 That’s all I have to tell you.
0:05:38 A martini!
0:05:41 Anyways, get on with the headlines.
0:05:41 Let’s do it.
0:05:43 Let’s start with our weekly review of Market Vitals.
0:05:54 The S&P 500 fell ahead of Trump’s auto tariffs announcement and struggled to recover.
0:05:56 The dollar climbed.
0:05:58 Bitcoin was relatively stable.
0:06:00 And the yield on 10-year treasuries rose.
0:06:02 Shifting to the headlines.
0:06:07 Delaware is making big changes to its corporate governance laws, such as restricting shareholder
0:06:09 lawsuits against founder-led companies.
0:06:13 The move aims to prevent businesses from relocating to states with looser regulations.
0:06:18 Waymo is launching its robo-taxi service in Washington, D.C. in 2026.
0:06:23 The company currently operates in San Francisco, Los Angeles, Silicon Valley, and Phoenix.
0:06:28 And finally, GameStop is officially adding Bitcoin to its treasury reserves.
0:06:34 Its stock initially surged on the news, but it eventually fell 23% after the company announced
0:06:40 a $1.3 billion convertible bond sale to fund the investment, which is, of course, exactly
0:06:41 what MicroStrategy did.
0:06:46 Scott, let’s start with your thoughts on this change coming from Delaware.
0:06:48 And just some context.
0:06:55 And I mean, this is coming right after this highly controversial lawsuit against Tesla that we
0:06:58 covered, where the Delaware court ruled against Elon Musk.
0:07:01 They canceled his $56 billion pay package.
0:07:06 And in response, Elon decided, fuck you guys, I’m leaving Delaware.
0:07:09 I’m going to reincorporate Tesla in Texas.
0:07:15 And we’ve seen other companies either following suit, moving, or they’re at least signaling their
0:07:16 intention to move.
0:07:18 One of those companies is Facebook.
0:07:25 And so this is Delaware’s response to that immigration out of their corporation system.
0:07:28 They’re loosening their governance laws in favor of founders.
0:07:31 They’re making it harder for shareholders to sue.
0:07:34 They’re also narrowing the definition of a conflict of interest.
0:07:39 These are all the very conditions that made that Tesla lawsuit possible in the first place.
0:07:42 And so this is basically their reaction to what happened with Tesla.
0:07:44 They’re now acquiescing.
0:07:44 Scott, your reactions.
0:07:49 So two-thirds of Fortune 500 companies, 67%, are incorporated in Delaware.
0:07:56 And that generates, get this, $2.2 billion in corporate franchise taxes annually.
0:07:59 That’s almost a third of the state’s budget.
0:08:03 And I would imagine it’s really high margin revenue.
0:08:10 And as you mentioned, Musk, they basically denied or voided Elon Musk’s $56 billion Tesla
0:08:13 compensation package despite shareholder approval.
0:08:16 And you can go back on the tape.
0:08:21 We said, whenever this happened, six or 12 months ago, bad decision, bad board, but they get to
0:08:28 make this decision and that for the courts to overturn it was a judgment call on what is, quote, unquote, fair compensation.
0:08:34 And if you want to talk about compensation in America around CEOs, you just shouldn’t use the word fair.
0:08:48 In capitalism, the owner of the asset or the majority of the assets get to nominate directors who get to decide correctly or incorrectly the compensation of the CEO.
0:09:02 And the moment someone weighs in and starts using words like fair or unfair and overrides the decisions of the people voted in by the owners of the company to make these decisions, in my view, you have government overreach.
0:09:03 So I think they screwed up here.
0:09:07 I think interstate competition is a good thing.
0:09:17 I think other states, in this instance, Texas, saying, OK, we want to compete with Delaware for companies to list here and offer them lower fees.
0:09:29 The problem is there is a social good to some of this around the disclosure requirements and how a board behaves that is a social good.
0:09:37 And I worry that there’s a race to the bottom around governance that ultimately hurts retail investors.
0:09:38 What are your thoughts?
0:09:45 The most important stat you mentioned there is the fact that a third of Delaware’s tax revenue comes from these incorporation fees.
0:09:50 I mean, people ask, you know, why do all these companies incorporate in Delaware?
0:09:55 The answer is that historically, Delaware has been a very pro-business state.
0:09:59 You have tax benefits, you know, strong privacy laws.
0:10:05 This is generally speaking throughout history, throughout corporate history, this has been a good place to incorporate your company.
0:10:08 And now we’re seeing a reversal of that trend.
0:10:14 People are now deciding, due to what happened with Elon, that Delaware is actually anti-business.
0:10:19 And so I think, to an extent, they don’t really have a choice but to loosen up on these laws right now.
0:10:27 Because if they don’t, and if they just let companies leave the state, they’re going to lose out on a ton of tax revenue.
0:10:33 And when you look at the state, this entire state is really reliant on these relationships with these corporations.
0:10:34 I don’t like it.
0:10:41 You know, I don’t like that we’re seeing, once again, regulators bending the knee to billionaires.
0:10:46 Critics are calling this the billionaire’s bill, this decision to loosen the laws.
0:10:51 And they’re right, because this is specifically designed to appease the billionaires.
0:10:59 It’s specifically designed to make the founders of these giant companies, which hold all of the shares and all of the voting power.
0:11:03 You know, companies like Facebook, where you’ve got Mark Zuckerberg and all of his interests.
0:11:10 And then, of course, companies like Tesla, this is all to make them feel happier about being in Delaware.
0:11:16 And it’s a trend that we keep on seeing, where regulators recognize the power of billionaires.
0:11:20 They recognize how much, you know, we need them in terms of taxes.
0:11:26 We’re so reliant on these rich people and their ability to contribute to government revenue.
0:11:29 And so, they have to do it.
0:11:30 So, I don’t blame them for doing it.
0:11:32 But is this a good thing?
0:11:34 No, I don’t think it’s a very good thing.
0:11:46 I don’t think it’s good that we are seeing a state basically rewriting their laws and rewriting their rules of equity to make the richest people in the world happy.
0:11:47 Let’s talk about Waymo.
0:11:53 Waymo is currently operational in San Francisco and L.A. and Phoenix.
0:11:56 But next year, it will be in D.C.
0:11:59 So, they are scaling very quickly.
0:12:01 Scott, your thoughts on Waymo?
0:12:08 I bet if you surveyed Americans on, if you said, what comes to mind when you say autonomous driving, the most common answer would be Tesla.
0:12:16 And the reality is, and you brought this to my attention, Waymo is just miles ahead of Tesla.
0:12:21 Tesla doesn’t look very close to a competent self-driving or autonomous vehicle.
0:12:25 And I took a Waymo six months ago in L.A., and I was kind of blown away by it.
0:12:27 I mean, they’re up and running.
0:12:32 They have 200,000 paid rides weekly across Phoenix, San Francisco, Los Angeles, and Austin.
0:12:35 I love the idea of autonomous driving.
0:12:38 I don’t – I’m trying to think how elitist this is going to sound.
0:12:39 I don’t like the drivers.
0:12:41 I don’t want any conversation.
0:12:47 I assume they are going to take me the wrong way, which is probably not very nice.
0:12:48 I get mad at them.
0:12:49 What do you get angry about?
0:12:53 I tend to get drivers who think they know the back roads, and I’m like, it drives me fucking crazy.
0:12:57 I don’t want them to ask me about the temperature, if I want to stream my radio.
0:12:59 I’m an awful person.
0:13:02 I don’t want to talk to anybody.
0:13:04 Does anyone ever recognize you when you get in the Uber?
0:13:07 They’re like, oh, you’re the guy, Scott Galloway, and trying to spark a conversation?
0:13:09 That has never happened to me in an Uber.
0:13:13 So, clearly, they’re not the target audience, so you can rag on them as much as you want.
0:13:13 Yeah.
0:13:15 I’m wondering what my star rating is.
0:13:20 My general approach to service is I’m not easy to deal with, but I tip big.
0:13:24 That’s my approach, which that’s pretty obnoxious.
0:13:25 I’m rich.
0:13:26 I don’t need to be kind.
0:13:30 I’m pretty sure that’s, yeah, that’s definitionally a douchebag.
0:13:30 Yeah.
0:13:32 First word douche, last name bag.
0:13:34 Should I write children’s books?
0:13:40 By the way, I kind of agree with you, but I’m trying to work on that.
0:13:43 I think I need to be better and more amenable to small talk.
0:13:44 You’re young.
0:13:45 You’re still in your mating years.
0:13:46 Yeah, exactly.
0:13:53 But just to focus on Waymo, as opposed to being antisocial, just some data.
0:13:56 So, Waymo completed more than 4 million paid rides last year.
0:14:01 That’s more than 11,000 autonomous taxi rides every single day.
0:14:06 And I just want to compare that to the competitors of Waymo.
0:14:08 You mentioned Tesla, which I agree.
0:14:12 I think when people say, they hear the word robotaxi, they think of Tesla.
0:14:15 How many paid robotaxi rides did Tesla complete last year?
0:14:16 Zero.
0:14:21 You look at the other competitors, Zoox, which is owned by Amazon.
0:14:24 Last year, they completed, wait for it, zero paid rides.
0:14:27 Cruise, which is owned by General Motors.
0:14:30 They also completed zero rides last year.
0:14:33 By the way, they also ended up shutting down that business entirely.
0:14:39 In other words, this is one of the most important technologies of our time, or so a lot of people
0:14:43 say, and Waymo is the only company in America that has figured it out.
0:14:46 Tesla’s been talking about it for 10 years.
0:14:47 They’ve shipped nothing.
0:14:52 Meanwhile, Waymo is fully operational in three major metro areas.
0:14:53 It’s expanding across four more.
0:14:56 I think they’re even testing in Japan right now.
0:15:01 So I think if you had to identify a sector where there is the greatest disparity between
0:15:07 the market leader and the runner-up, I think you would have to say that sector is autonomous
0:15:10 vehicles and robotaxis, and you’d have to pick Waymo.
0:15:12 And, you know, you mentioned the branding point.
0:15:14 I don’t think Waymo gets enough credit for this.
0:15:16 I mean, this is an incredible company.
0:15:18 They’re absolutely killing it right now.
0:15:24 And when you look at the competition, it just proves how difficult it is, both from a technological
0:15:26 perspective and also from a regulatory perspective.
0:15:32 This is the only autonomous company which is actually supported by regulators because they
0:15:34 recognize, yeah, this thing is safe.
0:15:35 They’ve tested it.
0:15:36 They’ve proven that it works.
0:15:38 And now they can expand.
0:15:44 The question I would put to you is they just raised $5.6 billion, or last year, they raised
0:15:48 $5.6 billion, I think at a pre-40 and a post-45.
0:15:54 So at 50, revenues of $50 to $75 million, that means they’re trading somewhere every
0:15:56 between, I don’t know, 70 and 90 times revenues.
0:16:00 Would you invest in Waymo at 70 to 90 times revenues right now?
0:16:02 I haven’t done the analysis on Waymo individually.
0:16:08 But if the robotaxi market is as big as people say it is, if it warrants the multiples that
0:16:14 we’re seeing in Tesla, I mean, how else could you justify the valuation of Tesla right now
0:16:16 if it isn’t autonomous driving?
0:16:17 Fair point.
0:16:21 If we’re comparing it with that, then yeah, I’d invest for sure.
0:16:26 If they can maintain this, this feels like a 2027 IPO, that’ll be pretty big.
0:16:27 Let’s talk about GameStop.
0:16:30 GameStop is deciding to purchase Bitcoin.
0:16:36 They’re adopting the same strategy that we saw with Michael Saylor at MicroStrategy.
0:16:47 I’ll just start off by pointing out that this really worries me because GameStop isn’t the
0:16:48 first to do this.
0:16:51 There are other companies that are following suit.
0:16:54 We’ve been over some of those companies in our episode with Josh Brown.
0:16:56 So this is becoming a thing now.
0:17:02 A lot of these companies are buying Bitcoin and doing the same thing that Michael Saylor did.
0:17:03 And why is that a problem?
0:17:06 You know, we’ve been friendly with Michael.
0:17:07 I know you’re friends with him.
0:17:13 I think we’ve been kind of nice, or at least we’ve gone a little bit easy on MicroStrategy.
0:17:18 But I think it’s getting to a point where this is becoming so popular among companies.
0:17:21 You know, not just GameStop, but dozens of other companies.
0:17:25 I think we now need to be more candid about what MicroStrategy is doing.
0:17:27 I think what they’re doing is a Ponzi scheme.
0:17:34 They’re buying up Bitcoin, and then they’re using the Bitcoin as collateral to sell bonds.
0:17:40 And then they’re using the proceeds from the bonds that they sell to buy even more Bitcoin,
0:17:45 which they again use to sell even more bonds by using collateral again.
0:17:47 So it’s just rinse and repeat, rinse and repeat.
0:17:50 You buy more Bitcoin, you sell more bonds.
0:17:51 You buy more Bitcoin, you sell more bonds.
0:17:53 That is a Ponzi scheme.
0:17:57 You’re using existing investors’ money to pay out new investors.
0:18:03 And it would be different if the bonds were secured by, you know, a productive asset,
0:18:05 an asset that generates actual cash.
0:18:06 But they’re not.
0:18:12 They’re secured by an asset whose value is entirely dependent on more investors entering the ecosystem.
0:18:16 And that, to me, is definitionally a Ponzi scheme.
0:18:23 But I just think that we’ve been so distracted by the astronomical returns that we’ve been seeing
0:18:24 on these stocks.
0:18:29 I mean, we just pointed out GameStop is way up this year, and it increased even more when they
0:18:31 announced this Treasury strategy.
0:18:34 MicroStrategy increased 600% in one year.
0:18:41 It’s so numerically compelling that I think what is happening is what so often happens with Ponzi schemes
0:18:45 that we’re so excited by it, we turn a blind eye to what’s really going on.
0:18:48 And I think a lot of other companies are now doing this.
0:18:52 You’ve got GameStop, there’s companies Semler, Metaplanet, Cooler.
0:18:55 They’re all public companies.
0:19:01 And you even now have the NASDAQ including MicroStrategy in the index fund, meaning we now have
0:19:06 millions of dollars of retirement account money and pension fund money going into these things.
0:19:08 And I think it’s a Ponzi.
0:19:15 And, you know, all it would take for the whole thing to come crashing down is for the price of Bitcoin to drop.
0:19:16 And you made that point to Michael.
0:19:23 You know, you said, what happens if Bitcoin goes to, say, you know, $40,000, I think.
0:19:29 And his response was, well, what happens if a meteor hits us tomorrow, which is clearly a false comparison
0:19:36 because the chances of a meteor striking the earth are infinitely lower than the chances of the price of Bitcoin going down.
0:19:42 So, you know, I’ve been, you know, a little reticent to talk about this aggressively
0:19:49 because, you know, I don’t want to make an enemy out of anyone.
0:19:53 But it’s getting to a point now where we’re seeing so much adoption of this.
0:19:58 GameStop, which is owned by so many retail investors, it is the retail stock.
0:20:00 And now they’re adopting this strategy.
0:20:06 And as I just mentioned, they say, we’re going to buy the Bitcoin, but first, we’re going to sell the bonds to do it.
0:20:08 So it’s the same strategy that we’ve seen.
0:20:11 And to me, this is really concerning.
0:20:12 But perhaps you have a different view.
0:20:17 When I was, I moved to New York in 2000, and I didn’t know anybody.
0:20:21 And almost right away, I made good friends with a couple of guys.
0:20:23 And I said, oh, you got to come to St. Parts for the holidays.
0:20:24 I’m like, yeah, I’m down.
0:20:30 And we knew enough people that knew enough people that had were billionaires that own boats.
0:20:33 And they would always have these crazy parties.
0:20:39 And this one guy who was always on the boat, kind of, he was this really handsome guy with great fashion.
0:20:42 And like, I always had like the hottest women around him.
0:20:43 His name was Andrew.
0:20:48 And Andrew was rolling with all these billionaires.
0:20:50 And I remember seeing him, or I had dinner with him in LA once.
0:20:53 And he rolled up in this like electric blue Ferrari.
0:20:54 And he was pitching me.
0:20:56 He said, I have a fund.
0:20:59 I try and find value stocks or something.
0:21:00 I was barely listening.
0:21:04 And he said, and I’m giving like 22% returns last year.
0:21:09 And, you know, my bullshit media, A, I didn’t have much money back then.
0:21:11 But I’m sort of like, yeah, this is way too exotic for me.
0:21:15 But he had raised, and he listed all these billionaires in St. Parts that he had raised money from.
0:21:16 And I knew most of these guys by name.
0:21:33 And it ends up that what he was doing was taking money and then giving money back to previous investors on redemption, claiming they got 20% returns when he wasn’t, he was using the money as his own personal kitty.
0:21:35 That is a Ponzi scheme.
0:21:44 Taking investors’ money to pretend you’re giving returns back to older investors, hoping new investors will see these false returns and put in more money.
0:21:46 And that’s what Madoff did.
0:21:49 I don’t think it’s fair to call this a Ponzi scheme.
0:21:54 What I think this is, is a massively levered bet.
0:22:00 Because at some point, so they’re buying Bitcoin, and then they’re borrowing against that Bitcoin, so they’re levering up.
0:22:02 And then they’re borrowing as much as they can on that.
0:22:04 They’re just massively levering.
0:22:10 I’d agree with you if the underlying asset generate had any sort of cash yield.
0:22:19 Maybe it’s Ponzi scheme doesn’t feel right because he’s not actively defrauding people and going and saying, hey, I’m going to take your money and then we’re going to put it over here.
0:22:27 But what is happening is that the value of the asset is dependent on other investors entering the ecosystem.
0:22:34 And the difference is that those investors are anonymous because it’s just people who buy Bitcoin.
0:22:43 The whole thing is predicated on in the same way that your friend was taking other people’s money and then paying it out to someone else.
0:22:49 This is the same system, it just has more people in the chain, is what I would say.
0:22:51 More points of contact, basically.
0:22:54 He’s making a hugely levered bet on an asset.
0:22:59 And people have decided it’s a legitimate asset class because people think it’s a store of value.
0:23:05 What you’re saying is ultimately over time, I think, an asset really isn’t an asset unless it’s producing some sort of underlying cash flows.
0:23:07 That it’s not a security.
0:23:08 I think we can call it an asset.
0:23:10 I don’t think it’s a security.
0:23:12 I think we can call it an asset.
0:23:18 But that dynamic that I describe, this thing no longer works if people don’t keep coming in.
0:23:21 The whole thing is predicated on that.
0:23:26 So as soon as that stops, as soon as new investors don’t enter, the whole thing collapses.
0:23:29 My sense of this is pretty simple.
0:23:37 You’re going to get huge returns if Bitcoin goes up because he’s levered the shit out of the Bitcoin he’s bought.
0:23:40 And it’s going to go way down because he’s levered the shit out of the Bitcoin.
0:23:45 But he’s not taking money and falsely claiming returns.
0:23:51 But he makes the argument that the whole thing is protected because it’s a bond.
0:24:03 But, you know, I think he picks and chooses different parts of this financial play such that he can say things like, well, what if a meteor strikes us tomorrow?
0:24:07 And by saying, oh, it’s a bond, you’re protected.
0:24:13 But then in certain occasions, not pointing out that actually it’s a convertible.
0:24:16 And, you know, this is going to convert to equity.
0:24:21 And you could very well lose all your money if Bitcoin goes up tomorrow, but then crashes the next day.
0:24:23 Yeah, you’re equity now.
0:24:24 You’re wiped out.
0:24:29 Some people are now owning it in their portfolios and they didn’t even sign up for it because it’s now part of the NASDAQ.
0:24:32 And this is why I’m being aggressive now and not before.
0:24:39 It reminds me of 2008 in a lot of ways where so many more companies and institutions are buying into it.
0:24:42 I think because they look at the numbers, look how much it’s gone up.
0:24:46 And that’s the part that concerns me, which is why I want to flag it.
0:24:55 The notion that people are diving too aggressively into the deep end of a pool in a market that is overvalued and then massively levering up.
0:24:58 Leverage is how smart people go broke, right?
0:25:08 And as we’ve discussed on this show, we’re big believers that the U.S. market has become too expensive and it makes sense to delever or perhaps exit.
0:25:15 And also, to be fair, everyone thought Bitcoin was a hedge against markets.
0:25:16 It’s not.
0:25:19 It’s ended up being much more correlated to the markets than anyone had anticipated.
0:25:29 And the Bitcoin maximalist or whatever the term is would claim that, oh, this is the perfect hedge against other assets.
0:25:30 Well, actually, no.
0:25:31 It’s pretty tightly correlated.
0:25:37 If the market pukes tomorrow, there’s a 70%, 80%, 90% chance that Bitcoin goes down.
0:25:47 So I think your argument is buyer beware because this is a levered bet that’s levered to a market that’s already bubblicious.
0:25:51 This is like the pop here could be really, really loud.
0:25:57 And Michael did say that you have to be able to survive this volatility.
0:25:58 This volatility is massive.
0:26:07 The one thing he said that I really liked was he said, you know, fire is dangerous, but if you put fire in a car, you can move the car.
0:26:09 I thought that was very sexy the way he said that.
0:26:10 It was very sexy.
0:26:12 Look, he’s really – he’s an amazing salesman.
0:26:20 And he has great analogies, but at one moment he compares it to real estate and he says this is like buying real estate in Manhattan.
0:26:23 And the next moment he’s comparing it to commodities.
0:26:26 And the next moment he’s comparing it to Henry Ford and the fire that fueled the car.
0:26:30 I mean these are all very different arguments that he’s picking and choosing.
0:26:31 I think you’re a little jelly.
0:26:33 I think you’re a little jelly.
0:26:34 Okay.
0:26:38 What I can guarantee, the comments are going to say Ed is jealous of him for sure.
0:26:40 I will meet you in the comments section.
0:26:41 We’ll see what people say.
0:26:43 Yeah, we’ll meet in the comments section.
0:26:47 And I can tell you – I can tell you what the comments will say based on who owns Bitcoin and who doesn’t.
0:26:48 Yeah, exactly.
0:26:50 I mean it’s just going to be 50-50.
0:26:56 We’ll be right back after the break with a look at an activist play at Lyft.
0:27:01 If you’re enjoying the show so far and you haven’t subscribed, be sure to give Prof.G Markets a follow wherever you get your podcasts.
0:27:14 Support for the show comes from the Fundrise Flagship Fund.
0:27:16 Real estate investing is boring.
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0:28:18 Today Explained here with Eric Levitt, senior correspondent at Vox.com to talk about the 2024 election.
0:28:19 That can’t be right.
0:28:20 Eric, I thought we were done with that.
0:28:22 I feel like I’m Pacino in three.
0:28:25 Just when I thought I was out, they pull me back in.
0:28:28 Why are we talking about the 2024 election again?
0:28:38 The reason why we’re still looking back is that it takes a while after an election to get all of the most high quality data on what exactly happened.
0:28:41 So the full picture is starting to just come into view now.
0:28:49 And you wrote a piece about the full picture for Vox recently, and it did bonkers business on the Internet.
0:28:51 What did it say?
0:28:52 What struck a chord?
0:28:53 Yeah.
0:28:57 So this was my interview with David Shore of Blue Rose Research.
0:29:04 He’s one of the biggest sort of democratic data gurus in the party.
0:29:32 If you’ve been online this week, you’ve probably seen an unending flood of those beautiful animated Studio Ghibli style images of everything from happy families being together
0:29:38 two beloved cartoon characters committing unspeakable acts of violence against each other.
0:29:43 That, my friends, is the AI world we live in, and it’s not going to get less complicated.
0:29:48 That is what we were talking about this week on The Vergecast, along with the future of robot vacuums,
0:29:52 what’s happening with car tariffs, and everything else going on in the AI world.
0:29:55 All that on The Vergecast, wherever you get podcasts.
0:30:07 We’re back with Proftree Markets.
0:30:14 Activist investor Engine Capital has taken a 1% stake in Lyft and is calling for a strategic review of the company.
0:30:19 They’ve raised concerns about Lyft’s stock performance, their strategic direction, and governance.
0:30:24 And they’re also calling for the removal of Lyft’s dual-class share structure.
0:30:26 And they’ve proposed new candidates for the board.
0:30:33 The stock rose more than 2% on that news, but it is still down more than a third over the past year.
0:30:37 I would first like to point out, Scott, which is what an unserious activist play this is.
0:30:43 Because, you know, they’re asking to reorganize the shareholder structure and get rid of the dual-class shares.
0:30:47 Dual-class shares exist so that this doesn’t happen.
0:30:53 They exist so that founders can protect themselves from these activists coming in and trying to change the company.
0:30:56 So, I don’t think this is going to go through.
0:30:58 I don’t think they’re going to get what they want here.
0:30:59 Maybe you have a different view.
0:31:04 But it does raise an important question, which is, what can Lyft do to revive itself?
0:31:05 It is performing very poorly.
0:31:08 It’s down around 85% since it went public.
0:31:10 And you were once an activist investor.
0:31:14 And from my understanding, you also know the CEO of Lyft as well.
0:31:15 You’re friendly with him.
0:31:19 So, what is your reaction to this activist play?
0:31:25 And perhaps if you were the activist yourself, how would you approach this company strategically?
0:31:27 So, your first point is the right one.
0:31:32 It’s almost comical that they’ve called for them to declassify their share structure.
0:31:33 Good luck with that.
0:31:40 Now, I think what they’d want to do is show up and say, we have a huge stake here and we want to help you.
0:31:53 The thing about activism that I learned is that typically when you go into a board of a company, you find out that you’re not as smart as you think and they’re not as dumb as you’d hoped.
0:32:03 And I don’t do hostile plays anymore because what I find you want to do is you want to show up with a big stake and say, we’re here to help.
0:32:04 We’re smart people.
0:32:12 And we want to be assets and help you brainstorm and maybe even provide more capital, provide introductions, brainstorm strategically.
0:32:16 I find that it’s just a much more effective way to try and build shareholder value.
0:32:24 And activism, and one of the reasons I was drawn to it because it suited my personality, it attracts a disproportionate number of assholes.
0:32:27 And they come out guns blazing.
0:32:39 And what they fail to realize is that the people they’re trying to embarrass publicly with their poison pen letters, unless it’s really egregious, are humans and will circle the wagons and defend it even if your points are right.
0:32:44 So my approach around this stuff evolved to, okay, we’re big shareholders.
0:32:46 We want to work with you.
0:32:50 Our default kind of operating system is to be great shareholders and great partners.
0:32:58 But if in a year or two years, you’re either stonewalling us or just making stupid decisions, we’re going to go gangster on you.
0:33:00 But we’re here to help.
0:33:02 We’re going to try and get along.
0:33:08 I find that’s a more effective, what I call forceful yet dignified approach to this.
0:33:13 Now, Lyft is an example of a number two that has not been able to establish differentiation.
0:33:20 And it has been a shitty place because Dara has made some really deaf moves around acquisition of food delivery.
0:33:23 He’s just done a really good job.
0:33:26 And they’ve kind of run away with it.
0:33:33 And since the IPO, Lyft has lost 85% of its value, while Uber shares are up nearly 80%.
0:33:36 Year-to-date, Lyft is down 11%.
0:33:37 Uber’s up 18%.
0:33:43 Uber trades at 3.6 times sales and Lyft trades just at 0.9, half its historical average.
0:33:45 So this company is struggling.
0:33:53 It doesn’t have the scale, and it doesn’t really have a niche to kind of focus on and sort of send a brand identity.
0:33:59 And the example I would use is a car pulls up, it has an Uber light, and then I see it turn off its Uber light, and it’s a Lyft light.
0:34:10 So, okay, if there’s no differentiation in driver or equipment, that means, okay, and Uber’s got scale, that means the only thing Lyft can do is compete on price.
0:34:13 And if you’re hiring the same driver in the same cars, how do you compete on price?
0:34:15 That’s just a downward spiral.
0:34:16 You don’t have to scale.
0:34:19 So, Lyft needs to find a strategy.
0:34:21 You know, what should they do?
0:34:23 I would not circle the wagons.
0:34:25 I would invite these guys in.
0:34:32 I don’t know how much of the company they bought, but I find the best thing to do on an incumbent board is to say, the best way to shut up an activist is just to put them on your board.
0:34:34 Just say, come on in, the water’s fine.
0:34:36 And put them on your board.
0:34:47 If they purchased a lot of shares, and then they have to shut up because of Reg D or, you know, insider disclosure rules, see if they have good ideas, listen to them, and get them kind of on your side, if you will.
0:34:49 So, that’s how I would handle the activist.
0:34:52 The tougher problem is what the fuck does Lyft do?
0:34:56 And my view is they have really two choices here.
0:34:58 The first is to pursue a sale.
0:35:06 And I could see a big automobile company thinking, all right, we want to go vertical, and we want to have an offering.
0:35:08 That we’re Tata Motors.
0:35:17 We want to have Range Rovers and Jaguars everywhere, or we feel like we’re going to take our production cars that aren’t selling.
0:35:18 Maybe that’d be bad for the brand.
0:35:19 I’d have to think about it.
0:35:24 But we want to go vertical and have, you know, be in ride-hailing.
0:35:29 The other thing, I mean, they either got to do a sale, or they’ve got to find a niche.
0:35:32 So, for example, I love Wheelie.
0:35:34 That’s a ride-hailing service here in London.
0:35:38 And it’s basically, there’s Uber, Uber Black, and then there’s Uber Lux.
0:35:42 And Wheelie is Uber Super Lux.
0:35:47 Beautiful brand-new S-classes, suited driver, super clean.
0:35:49 Other cars look brand-new.
0:35:51 It’s just a different level.
0:35:53 And they’ve gone after that niche.
0:35:56 And I’m sure they charge more, and it’s worth it, and it’s aspirational.
0:35:58 And I hardly ever use Uber in London now.
0:36:00 I use Wheelie.
0:36:03 And I thought, okay, what does Lyft offer?
0:36:07 And Lyft does have a luxury offering that looks better than Uber.
0:36:24 And that might not be the niche, but Lyft has to find a niche and be known as the ride-hailing company that has a certain type of car, or the ride-hailing company that specializes in, you know, I don’t know, helping people with special needs.
0:36:32 I don’t know what it is, or the dog-friendly ride-hailing, they’re going to have to find a niche and own it and build out from there.
0:36:39 Because all they are now is the subscale number two, and every day they are losing share.
0:36:40 Yeah, exactly.
0:36:43 I mean, Lyft did $6 billion in revenue, a little less.
0:36:46 Last year, Uber did $44 billion.
0:36:49 They had almost $800 million in free cash flow.
0:36:51 Uber had almost $7 billion.
0:36:56 This is a true David and Goliath situation that has only been getting worse.
0:37:05 But to your point, you know, Lyft trading at 0.9 times sales, its market cap is lower than its revenue.
0:37:08 It’s around $5 billion in market cap.
0:37:10 It used to be around $25 billion in market cap.
0:37:14 It certainly feels cheap from an acquisition perspective.
0:37:18 You know, you make the point that they should be listening to offers.
0:37:29 I just wonder if people or companies are making offers, and if there are any companies you think would be best suited to make an offer to Lyft.
0:37:33 Because it certainly looks like a really, really good acquisition target right now.
0:37:35 The team put together some ideas.
0:37:36 Merge with DoorDash.
0:37:38 That wouldn’t be a merger.
0:37:42 That would be a sale because DoorDash has an $80 billion market cap, so they would buy them.
0:37:47 DoorDash’s stock is up 36%, so they kind of have cheap stock to go shopping with.
0:37:50 And they’re trading at eight times sales.
0:37:55 So I don’t know if it would be accretive because I don’t know how profitable or unprofitable Lyft is.
0:37:57 Be acquired by Amazon.
0:38:00 Be acquired by Google or Waymo.
0:38:04 I would bet, quite frankly, a lot of these potential acquirers.
0:38:10 I don’t doubt there’s some people who think, we’ll buy Lyft, but call us when it gets down to $2 billion.
0:38:17 Because this company just is, it just continues to go down.
0:38:25 And I think the only way they’re going to prompt someone into buying is to get so damn cheap or the banker calls and says, we do have a credible offer.
0:38:26 Speak now or forever.
0:38:27 Hold your peace.
0:38:38 Because when a company is just consistently going down, there’s no penalty to waiting because you believe, okay, and this isn’t cheap.
0:38:39 What’s the market cap?
0:38:40 About $5 billion.
0:38:43 So they would claim we need a premium.
0:38:46 So you’ve got to come up with $7 or $8 billion here.
0:38:52 And if you’re, you know, let’s say, say you’re GM, right?
0:38:54 And you think, oh, I’m going to get into this.
0:38:55 Market cap of $47 billion.
0:39:05 Do you really want to take like a 15% dilution to acquire a money-losing number two ride-hailing company?
0:39:06 I mean, that’s the kind of thing that-
0:39:09 They are now profitable now, but only just, yeah.
0:39:10 So breakeven.
0:39:13 So Ford, Ford has a $39 billion.
0:39:15 I mean, those guys can’t do it.
0:39:16 I used to think that was probably a good idea.
0:39:18 I don’t think they can do it.
0:39:20 It would have to be-
0:39:22 I know what’s going on here.
0:39:23 They have a banker.
0:39:25 They’ve reached out to all of these people.
0:39:26 They’re not dumb.
0:39:29 They know how challenging this is for them.
0:39:30 They’re ready.
0:39:39 They’ve got their best dress on, and they’re trying, and they want to get, you know, someone to take them home from the dance or put a ring on it.
0:39:44 And my guess is everyone’s like, why wouldn’t we wait another six months when it goes down another 15%?
0:39:46 So he has to find a strategy.
0:40:00 He has to find some type of growth, even if it’s a smaller acquisition of $100 million to a billion, to say we have something that differentiates us or gives us a pulse here.
0:40:05 We’ll be right back after the break with a look at Gen Z unemployment.
0:40:09 If you’re enjoying the show so far, hit follow and leave us a review on Prof G Markets.
0:40:24 So we want to introduce you to another show from our network and your next favorite money podcast, for ours, of course.
0:40:30 Net Worth and Chill hosts Vivian Tu is a former Wall Street trader turned finance expert and entrepreneur.
0:40:35 She shares common financial struggles and gives actionable tips and advice on how to make the most of your money.
0:40:42 Past guests include Nicole Yoder, a leading fertility doctor who breaks down the complex world of reproductive medicine and the financial costs of those treatments,
0:40:48 and divorce attorney Jackie Combs, who talks about love and divorce and why everyone should have a prenup.
0:40:51 Episodes of Net Worth and Chill are released every Wednesday.
0:40:55 Listen wherever you get your podcasts or watch full episodes on YouTube.
0:40:56 By the way, I absolutely love Vivian Tu.
0:40:58 I think she does a great job.
0:41:07 We’re back with Prof G Markets.
0:41:13 Recent data from the Federal Reserve Bank of New York reveals a concerning trend for college graduates.
0:41:16 Securing a job is becoming increasingly difficult.
0:41:22 Since September 2022, the unemployment rate for college grads has surged by 30%,
0:41:27 outpacing the overall unemployment rate increase of 18% for all other workers.
0:41:30 Not only are more graduates struggling to find work,
0:41:36 but hiring rates for jobs requiring a college degree have also slowed more than those for other roles.
0:41:40 So, Scott, what do you make of this shift?
0:41:44 And what advice would you give to college graduates who are trying to navigate this?
0:41:51 To a certain extent, what came out of COVID was the jobs that had a little bit more purchase were either,
0:41:56 you know, you understand AI or you slipstream into the right parts of the growth economy,
0:41:59 or you’re a plumber.
0:42:04 You know, I think vocational jobs are actually doing quite well, right?
0:42:11 AI can’t give you a massage or install energy-efficient HVAC heaters.
0:42:14 Supply is outpacing demand for computer scientists.
0:42:18 Jobs posted for software development roles are down 30% from pre-pandemic levels.
0:42:24 Meanwhile, the number of students majoring in computer science has jumped 40% in the past five years.
0:42:29 It was this, whenever something becomes conventional wisdom, it’s no longer wisdom.
0:42:32 And the conventional wisdom is just go into computer science, you’re going to be fine.
0:42:39 It does appear that this is kind of AI is sort of claiming its first victims,
0:42:45 and it’s sort of information age workers that are expensive, but not that experienced yet.
0:42:49 And the macro data kind of glosses over these struggles.
0:42:54 U.S. job openings remain historically strong, 7.7 million open roles as of January 2025,
0:42:57 led by education and health services, business and trade.
0:43:01 And overall unemployment is at 4.1%.
0:43:04 Spain’s unemployment rate is 11%, Canada is nearly 7%.
0:43:06 So our unemployment is still at historic lows.
0:43:13 But the reason this gets a lot of attention is that we’ve spent 20 or 30 years just reporting on,
0:43:19 I mean, literally for the last 20 or 30 years almost, except for some moments around recession,
0:43:21 but in non-recessionary times, which we’re in right now,
0:43:24 if you got a college degree, you got a job.
0:43:27 You might have to not take the job you wanted.
0:43:29 You might have to take a job for less, but you got a job.
0:43:33 Now there are generally, it appears to be, people who are having real trouble finding anything.
0:43:35 And so that makes the news.
0:43:41 But if you pull back the lens, the job market is still pretty strong.
0:43:42 I think there’s pockets.
0:43:45 I wouldn’t want to be coming out of school right now looking to go into work in consulting.
0:43:50 I got to think consultants are thinking, do we really need new people when we can make every
0:43:54 person here 10, 20, 40% more productive in the next three years using AI?
0:44:00 So I think a lot of the traditional roles that undergrads from good institutions or even
0:44:05 MBAs thought they could just slipstream into are, those are the jobs that are being hurt
0:44:06 the most.
0:44:13 But I wouldn’t be surprised if they reconfigure, reestablish different curriculum tools, and
0:44:14 these kids are fine.
0:44:17 Or put another way, I still think it’s a good idea to go to college.
0:44:24 What I hope, and this is my rant about college, is that they start putting schools on the hook
0:44:29 for some of that bad student debt such that they aren’t as promiscuous and intoxicated around
0:44:35 issuing debt to a kid who’s going to get a philosophy degree and not be able to find work.
0:44:41 So the kid you really feel for is the kid who borrowed $100,000 to get through school and
0:44:41 gets out.
0:44:45 I mean, some of the majors at my school at NYU are just so fucking ridiculous.
0:44:53 Gender studies and the important discussion of the politics of styrofoam, they get to
0:44:54 make up their own majors.
0:44:56 I’m like, who would hire you at that?
0:45:00 Anyway, so cheap credit, I think, has really hurt.
0:45:04 And the promiscuity of issuing debt to some of these kids, I think, is setting them up for
0:45:04 failure.
0:45:08 But I still think these kids are going to be much better off than non-college educated
0:45:08 kids.
0:45:10 I think we should be clear on the scale of the problem.
0:45:17 So, I mean, yes, the unemployment rate has increased by 30% from the previous number,
0:45:22 but the actual number among college educated people is still not that high.
0:45:23 It’s 2.6%.
0:45:27 So, like this, you know, college grads are fine right now.
0:45:30 But I think what is more important is the trend.
0:45:38 And the trend is that jobs that generally require a college degree are compared to other jobs in
0:45:39 decline.
0:45:46 So, these are jobs like sales managers and administrators and analysts and programmers.
0:45:52 The jobs that require, generally speaking, some level of skill and knowledge and experience
0:45:57 and an understanding of how to organize and manage other people.
0:45:59 Those are the jobs in decline.
0:46:02 Why is that happening?
0:46:05 I think you said it.
0:46:06 It’s technology.
0:46:07 I mean, there’s AI.
0:46:08 There’s generative AI.
0:46:14 But even just the more primitive technologies like CRM management and data analytics platforms,
0:46:21 the reality is that today, most cognitive tasks that we used to delegate to college-educated
0:46:24 kids can now be delegated to a computer.
0:46:29 And that does leave young people with a very important question, which I would like to pose
0:46:33 to you, which is, what should we try to be good at?
0:46:36 I mean, you brought up computer science.
0:46:36 Exactly right.
0:46:41 Ten years ago, everyone was telling us computers are taking over, so you need to understand how
0:46:42 to program a computer.
0:46:49 Half of us became coders, and what do you know, coding jobs are now down 30% since before
0:46:49 the pandemic.
0:46:55 I mean, it’s almost as if the computer science degree has turned into that gender studies
0:46:57 philosophy degree you just made the comparison.
0:47:02 It’s like, people are going out there, they learned how to become a software engineer, and
0:47:05 they’re realizing, oh, wait, AI can do the job for me.
0:47:09 So, we’re left with that question once again.
0:47:12 What are we supposed to be good at?
0:47:15 What are the kinds of skills that we should be learning?
0:47:20 What should we be focusing on if we want to be productive, and we want to get rich, and
0:47:23 we want to provide real economic value in this country?
0:47:26 And so, I would pose that question to you, Scott.
0:47:28 What would be your advice in 2025?
0:47:30 It’s a really thoughtful question.
0:47:32 I’m not sure I have a silver bullet here.
0:47:38 What I would say is I would divide it or segment it into two cohorts, and that is 10% to maybe 20%,
0:47:41 although half of kids think they know what they want to do, but they’re just
0:47:42 reading headlines.
0:47:48 A minority, but a significant group of kids are like, I am passionate about computer science,
0:47:51 or I’m just really good at it.
0:47:52 I understand it.
0:47:53 I am good at it.
0:47:54 I pick up on it.
0:47:55 I get A’s in this course.
0:47:56 I’m into it.
0:47:59 Doesn’t matter what the trends are.
0:48:00 You go into that.
0:48:06 Because if you’re great at computer science, you’re going to get a job.
0:48:11 If you’re just a standout programmer, even if they’re firing computer systems engineers,
0:48:17 if you’re great at it, you’ll figure out a way to stand out and find work.
0:48:27 If you think, oh, I’m just fantastic at biology, boom, I could be great at this, go into it and
0:48:30 ignore what the trends are because you don’t know where the world is going to go.
0:48:35 Now, for the rest who are thinking, I just want to be an economic animal, I think sort
0:48:42 of the universal or the most athletic degrees are take a decent amount of, if you can, I think
0:48:45 you really benefit from finance and economics courses.
0:48:49 I think you absolutely benefit from the sciences courses because if you have an understanding,
0:48:52 a preliminary understanding of chemistry or biology, you kind of understand a little bit
0:48:53 of everything.
0:48:55 That is the building blocks of life.
0:48:56 Business mimics biology.
0:49:03 I mean, even the little kind of courses I took on astronomy or astrophysics, you start
0:49:06 to go, wow, you see that in everything.
0:49:09 Also, I wish I’d taken more English.
0:49:13 Communication is the gangster skill that I think will endure.
0:49:19 So your ability to write well, if you can develop that skill, you can more easily develop a skill
0:49:21 around all communications mediums.
0:49:25 I think that one of the reasons I write so much is I want to be a great speaker, I want
0:49:30 to be great on podcasts, and I think it all starts with your ability to write well.
0:49:36 So I wish I’d taken more English, more biology, an understanding of history, I think is really
0:49:37 important.
0:49:45 And also try and be, and this isn’t a class, try and be as social as possible.
0:49:50 Because A, it’s an unbelievable opportunity to develop friendships and relationships.
0:49:57 And at Google, when they put out a job opening, they get 200 CVs in minutes and they shut it
0:49:57 down.
0:49:59 And then they invite in 20 people.
0:50:05 And 70% of the time, the person who gets the job is someone who has a friend at the firm
0:50:06 that is advocating for them.
0:50:14 And so what is the easiest way or the likely the way you’re going to improve your odds the
0:50:18 most of having, getting a job is having a lot of friends.
0:50:20 How did you get a job, Ed?
0:50:24 You had a best friend whose mom knew me, and they love you.
0:50:30 Literally, Joanna Coles called me and said, you’d be stupid not to hire this kid.
0:50:31 That’s what she said.
0:50:38 She’d be like, I think her words were, I am not getting off this phone until you commit,
0:50:40 until you promise.
0:50:42 I really owe my life to Joanna Coles.
0:50:46 That you are hiring my son’s friend, Ed Elson.
0:50:48 I’m like, and I said, well, what does he want to do?
0:50:51 She’s like, it doesn’t matter, you fool.
0:50:55 What a legend.
0:50:56 Yeah, but it works, right?
0:51:03 So I get the sense, you know, I mean, you’ve got a lot of flaws, but I get the sense.
0:51:06 I get the sense you have really good relationships.
0:51:08 You take your friendship seriously.
0:51:13 And that’s how you got this job, is you got someone in your life who just really cares
0:51:20 for you and basically told his mom, help Ed get a job, or Ed said he knows this guy or likes
0:51:20 this guy.
0:51:21 Can you call him?
0:51:22 I heard you know him.
0:51:23 You want to get a job?
0:51:24 You got to be good.
0:51:25 Learn the basics.
0:51:27 I like the sciences.
0:51:28 I like communication and storytelling.
0:51:33 But the way you get a great job and the way you change the trajectory of your professional
0:51:35 career is relationships.
0:51:41 And while you’re in college, it is a great opportunity to establish a lot of really like
0:51:43 great, deep, meaningful relationships.
0:51:48 It’s so interesting because a lot of the skills that you mentioned there are kind of the skills
0:51:51 that you’re supposed to be accumulating from a liberal arts education.
0:51:52 100%.
0:51:57 And this is the, I mean, liberal arts degrees have been in decline and people have been
0:51:59 saying, you know, what’s the point of these liberal arts degrees?
0:52:05 But it is, it does, it’s starting to feel that now that we’ve almost over-indexed so hard
0:52:12 on the hard sciences and on the computer sciences, that suddenly the economy is seeming to kind
0:52:18 of reshift and we’re starting to see more emphasis on the soft skills, the ability to communicate,
0:52:21 to tell a story, to, you know, have a strong sense of history.
0:52:26 I mean, maybe I’m being biased because I got a liberal arts education, but there was this
0:52:33 interesting quote by this guy, Amjad Massad, who was the CEO of Replit, which is this big
0:52:34 software company.
0:52:39 And he was talking about this new trend of vibe coding.
0:52:44 And this is this trend that is becoming very big in Silicon Valley, where engineers are basically
0:52:48 just prompting AI to build the code for them.
0:52:53 And you now have very reputable, even, you know, computer science professors who are teaching
0:52:58 people how to vibe code because they recognize this might be the future of coding.
0:53:02 You don’t need to have a really perfect understanding of computer science.
0:53:06 You can basically use AI to just push the ball down the line.
0:53:12 And he was making the case for vibe coding, this guy, Amjad Massad.
0:53:16 And he even said that he doesn’t think people should be learning to code anymore.
0:53:21 In the up case, like, you know, what Dario just said recently, all code will be AI generated.
0:53:27 You know, I assume this optimization path we’re on, where agents are going to get better and
0:53:27 better and better.
0:53:29 You know, the answer would be different.
0:53:30 The answer would be no.
0:53:33 It would be a waste of time to learn how to code.
0:53:37 I would say learn how to think, learn how to break down problems, right?
0:53:45 Learn how to communicate clearly, you know, with, you know, as you would with humans, but
0:53:46 also with machines.
0:53:49 That to me is like a glowing endorsement of liberal arts.
0:53:51 But I’m curious to get your take.
0:53:57 The best programmers understand logic and they’re almost like internal construction managers.
0:54:03 They’re great project managers and also someone’s going to have to give these LLM prompts
0:54:05 and build the system.
0:54:07 So there’s still going to be a need for them.
0:54:10 It’s just like anything else that gets digitized.
0:54:14 When technology comes into a sector, it usually takes the top 10% and they earn three times as
0:54:17 much and the bottom 90 make less or aren’t there.
0:54:19 And I think that’s happening in that field.
0:54:28 So the, the correlate or the resonance here is on day after tomorrow, I’m headed to the
0:54:30 U S with my oldest son for a college tour.
0:54:38 And we’ve been thinking about, you know, there’s, there’s a opportunity set of a hundred colleges
0:54:41 and we’re going to seven of them in five days.
0:54:43 And we’ve been thinking a lot about it.
0:54:44 And I said, all right, what are your criteria?
0:54:47 And he’s like, you know, I want a place with a great biology department.
0:54:50 And he’s, that’s what he came up with.
0:54:53 Cause he’s really interested in biology and he has some real aptitude for it.
0:54:55 And he said, what are your criteria?
0:54:58 I’m like, I just want, you know, a small number of things.
0:55:03 I want you to go somewhere where I think you’re just going to have an amazing time because I
0:55:04 had an amazing time in college.
0:55:09 And if I could give my kids anything, I want you, I just want them to have the same amazing
0:55:09 time I had.
0:55:12 I want you to learn about yourself.
0:55:13 I want you to learn about others.
0:55:17 I would love for you to acquire some skills, specifically some skills around storytelling,
0:55:23 communication, but more than anything, more than anything, what I would hope for you is that
0:55:29 you experience, enjoy, endure a ton of relationships.
0:55:37 I just want you at basketball games and classes with 400 people on campus all day long, tutoring
0:55:44 people, getting tutored, hanging out, drinking with friends, playing ultimate Frisbee, playing
0:55:45 intramural sports.
0:55:53 I just want you bumping off people all day long and creating just a raft of relationships
0:55:54 and friendships.
0:55:56 That’s what I’m looking for.
0:56:01 And so we’re going to all these kind of land grant schools that are big public schools with
0:56:06 football teams and intramurals and fraternities and sororities.
0:56:11 I don’t know if we’ll do that, but tons of student clubs where they just feel like, quite
0:56:12 frankly, like college.
0:56:15 And I think a lot of parents feel this way.
0:56:22 I think a lot of, if you’ve looked at the applications trends, the Southern schools are booming.
0:56:27 And quite frankly, it’s like how collegey and how fun do they sound?
0:56:29 We want our kid to go have fun.
0:56:31 Like schools like Wake Forest are booming.
0:56:32 Their applications are booming.
0:56:38 Vanderbilt is now more difficult to get into than many Ivy League colleges because a lot
0:56:44 of parents and kids have said, I want my kid to have a college experience, full stop.
0:56:49 I mean, if I were to summarize your advice there, it’s to get as good an understanding
0:56:51 as possible of other people.
0:56:52 And yourself.
0:56:52 Right.
0:56:57 And the only way that you could do that is through meeting other people and establishing
0:56:58 relationships with them.
0:57:04 And I do think that is actually great advice because it makes you nimble in any situation
0:57:04 economically.
0:57:10 I mean, the biggest realization for me coming out of college was I thought these companies
0:57:16 that I heard about were these big sort of amorphous conglomerate brands that have all
0:57:20 these rules and definitions for, you know, this is what, these are the skills that you
0:57:22 must learn and these are the type of person you must be.
0:57:25 In fact, it’s all just groups of people.
0:57:31 And your ability to get hired is, as you say, a function of whether the person in charge of
0:57:34 the hiring decision likes you and wants to work with you.
0:57:40 And that was honestly a really eye-opening experience for me is realizing that life and work
0:57:42 is literally just interacting with people.
0:57:46 So if you can be really good at that, then I think you’ll be fine.
0:57:47 That’s the key.
0:57:49 It’s like anything else.
0:57:50 It’s, it’s, you gotta be good.
0:57:54 Being intelligent, being hardworking, that’s table stakes in this economy.
0:57:58 The differentiator is the depth and number of relationships you have.
0:58:01 Let’s take a look at the week ahead.
0:58:06 We’ll see the unemployment rate for March and U.S. reciprocal tariffs are set to go into effect
0:58:10 Tuesday on what Trump is calling Liberation Day.
0:58:12 Scott, any predictions from you?
0:58:14 It’s not so much as a prediction, but an observation.
0:58:21 We have this clown car called the cabinet right now.
0:58:25 And I just think this is going to start to hit the economy.
0:58:29 Strategy is two questions or one key question.
0:58:30 What can we do that’s really hard?
0:58:36 And the biggest mistake people make in strategy is that they think they’re punching a speed bag
0:58:38 and people aren’t going to punch back.
0:58:43 And every nation we have levied tariffs against, they have levied reciprocal tariffs.
0:58:44 They have punched back.
0:58:46 And some are getting really smart.
0:58:52 EU and Canada, I love this, have decided to pick products where they’re going to put especially
0:58:56 onerous disproportionate tariffs on products that originate from red states.
0:59:02 And the whole world is sort of deciding now, including our allies, that they have this common
0:59:05 enemy called this clown fucking car called the United States.
0:59:10 And there’s just no way that that doesn’t begin to hit our economy.
0:59:14 So I, and it’s dangerous to make predictions about the economy.
0:59:21 I just don’t see there’s any way that this doesn’t impact us in the back half of the year.
0:59:23 I don’t, I think he has dug himself too deep.
0:59:28 And if even, even if you were to say tariffs are off, just kidding, nations are reconfiguring
0:59:34 their supply chain and it’s going to start to show up in Q3 and Q4 numbers in some, I’ll
0:59:37 just say, I think we’re headed for recession in back half of the year.
0:59:43 This episode was produced by Claire Miller and engineered by Benjamin Spencer.
0:59:45 Our associate producer is Alison Weiss.
0:59:46 Mia Silverio is our research lead.
0:59:48 Isabella Kinsel is our research associate.
0:59:50 Drew Burrows is our technical director.
0:59:53 And Catherine Dillon is our executive producer.
0:59:56 Thank you for listening to Prof G Markets from the Vox Media Podcast Network.
1:00:00 Join us for a fresh take on markets on Thursday.
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1:00:17 you have me in kind reunion
1:00:23 as the waters
1:00:29 and the dark flies
1:00:31 in love

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0:01:34 I’m Scott Galloway, and this is No Mercy, No Malice.
0:01:38 A key question for all business leaders and owners.
0:01:42 Are you paying your people a living wage?
0:01:48 Project 2028 Wages, as read by George Hahn.
0:02:02 Democrats need to be the party of ideas, not indignation.
0:02:09 Our Project 2028 series addresses critical issues facing America through a No Mercy, No Malice lens.
0:02:13 Today, we shift from housing to wages.
0:02:30 Before he was sworn in as Treasury Secretary in January, hedge fund manager Scott Besant warned that failing to extend $4 trillion in tax cuts would trigger an economic calamity.
0:02:38 This is true if calamity means a reduction in the wealth of the richest Americans and large corporations.
0:02:40 What bullshit.
0:02:52 The real calamity is the poverty and inequality that’s set to worsen as the Trump administration advances policies that will disproportionately benefit a small number of people.
0:02:55 See above, the richest Americans.
0:03:04 The illusion of complexity is weaponized by the incumbents to mask a simple truth.
0:03:17 The clearest, blue-line path to a decrease in obesity, depression, incarceration, gun deaths, divorce, diabetes, homelessness, and crime is, wait for it,
0:03:22 to put more money in the pockets of lower- and middle-income citizens.
0:03:27 And the easiest way to do this is to hike the minimum wage.
0:03:40 Raising the pay floor to $25 an hour would ensure that Americans can afford to have children, if they want, feed their families, and pay for housing and health care.
0:03:45 In 2009, the minimum wage was $7.25.
0:03:56 Since then, the cost of a Big Mac, the average rent, and the NASDAQ have risen 60%, 70%, and 800% respectively.
0:04:04 Meanwhile, the minimum wage has rocketed from $7.25 to $7.25.
0:04:15 Even though many states and cities have raised their minimum wage, one in four U.S. workers still makes less than $17 an hour.
0:04:24 With the government failing to act and many companies content to sequester record profits at the expense of the working class,
0:04:28 leaders of successful American businesses should step up.
0:04:42 The system is broken when 18 million U.S. households are struggling to secure enough food,
0:04:51 and 12 million renter households are severely cost-burdened, spending more than half their earnings on housing and utilities.
0:04:55 In theory, wages are dictated by the market.
0:05:01 But the market is inherently imbalanced, and employers are the ones who have the upper hand.
0:05:09 The government has the power to level the playing field by setting the floor on compensation at a living wage,
0:05:15 what a full-time worker must earn on an hourly basis to cover the cost of their family’s basic needs.
0:05:18 This should be table stakes.
0:05:29 In a society where one company, NVIDIA, adds $277 billion in market capitalization within five minutes of its earnings release,
0:05:33 and one in five households with children is food insecure,
0:05:43 we have decided that America is an operating system to optimize the output of the bottom 99% for the benefit of the top 1%.
0:05:46 Enough already.
0:05:50 But a living wage means much more than that.
0:05:58 Vulnerable workers are less likely to defer medical care, suffer from depression and anxiety, or commit suicide.
0:06:05 Less likely to burden emergency rooms, lose their job due to illness, or get saddled with crippling debt.
0:06:14 We know increasing family income dramatically improves childhood development, producing better educated and healthier adults.
0:06:28 It’s also a race and gender-blind means of redressing inequality in pay and increasing opportunities for women and ethnic minorities who are overrepresented in low-wage jobs.
0:06:37 This is affirmative action as it was meant to be, focusing on people who need it most versus their identity.
0:06:50 In Los Angeles, a single adult without children needs an hourly wage of $27.81 to cover basic costs, according to MIT’s living wage calculator.
0:06:59 Two working parents with two children must each earn $32.69 an hour.
0:07:05 L.A. is expensive, but the living wage in many parts of the country isn’t significantly lower.
0:07:16 In Kansas City, the living wage for a single adult is $22.75, or $27.55 for two working parents with two kids.
0:07:27 In Mississippi, the poorest state in America, you’d need to make an hourly wage of $20.75, or $22.43, respectively.
0:07:41 In his confirmation hearing, Besant said he sees the minimum wage debate as, quote, more of a statewide and regional issue, unquote.
0:07:51 Elected leaders are big on states’ rights as a weapon of mass distraction when it suits their agenda, and indeed, many states have stepped into the void.
0:08:03 By 2027, 19 states and Washington, D.C., covering almost half of the U.S. workforce, will likely have a minimum wage of at least $15 an hour.
0:08:10 But this is a critical federal issue, one that Democrats should continue to spotlight.
0:08:16 The meager minimum wage has a knock-on effect, keeping pay lower for millions of people.
0:08:20 The numbers paint a depressing picture.
0:08:26 Although relatively few people receive the federal minimum, many are struggling to stay afloat.
0:08:31 Almost 6 in 10 jobs pay less than $25 an hour.
0:08:42 There isn’t a single state, metro area, or county in the U.S. where a full-time minimum wage worker can afford a modest two-bedroom rental.
0:08:50 You always hear the same bullshit narrative from opponents of increasing the minimum wage.
0:08:59 They argue it will hamper the competitiveness of businesses and lead to closures and job losses, hurting the workers it’s meant to help.
0:09:03 If employers have to pay workers more, they’ll hire fewer of them.
0:09:06 These are scare tactics.
0:09:12 Research shows raising the minimum wage would have little to no impact on employment.
0:09:19 In fact, it can have a stimulative effect as workers spend their additional earnings.
0:09:26 When paid well, workers are more productive, and they’re less likely to leave, reducing costs for employers.
0:09:30 Some businesses fold, and they should.
0:09:34 They are the weakest performers and, quite frankly, shouldn’t be in business.
0:09:39 The lost employment is mostly absorbed by stronger firms.
0:09:44 Another way businesses adapt to higher wages is by raising prices.
0:09:48 But economists find it leads to scant price hikes.
0:10:02 One analysis of restaurant food pricing between 1978 and 2015 showed prices rose by just 0.36% for every 10% increase in the minimum wage.
0:10:12 There’s rarely a free lunch, and some companies, like McDonald’s, Walmart, would register a significant decrease in profits and share price.
0:10:14 It would be worth it.
0:10:24 For much of the 20th century, unions played a critical role in trying to equalize the balance of power and obtain higher wages for workers.
0:10:31 However, unions have struggled to overcome corruption, adapt to innovation, and maintain relevance.
0:10:41 The share of U.S. workers who belong to a union fell to about 10% in 2023, from about a third in the 1950s.
0:10:52 Although 70% of Americans say they approve of labor unions, only 28% say they have quite a lot or a great deal of confidence in them.
0:11:01 The states that need unions the most are hostile to them, and the overwhelming majority of Western nations with unions have shed membership.
0:11:22 The U.S. economy can support a far larger share of wealth going to lower-income workers.
0:11:35 Between 1938, when Franklin D. Roosevelt signed the first minimum wage into law, and 1968, the federal minimum wage was regularly increased to account for inflation and productivity.
0:11:49 A 2020 study found that if the U.S. had continued to increase the minimum hourly wage in line with inflation and productivity growth, it would have reached $21.50 an hour.
0:11:53 Today, it would be close to $25.
0:11:57 More than tripling the minimum wage wouldn’t be easy.
0:11:59 The shift would need to occur in phases.
0:12:05 Some sectors and regions can make reasonable arguments in favor of exemptions.
0:12:13 The living wage is also not the same in all regions, so some exceptions would make sense, though we’re an increasingly national economy.
0:12:20 The prevalence of chain stores and online platforms with standardized pricing are closing regional gaps.
0:12:33 We need a system where successful CEOs and founders who demonstrate real talent earn enormous pay, and workers, at the other end of the spectrum, earn a decent living.
0:12:35 That’s often not the case.
0:12:39 Income inequality has gone berserk.
0:12:54 From 1978 to 2023, compensation for top CEOs exploded 1,085%, compared with a 24% rise in the typical workers’ pay.
0:13:07 The median pay package for an S&P 500 company leader climbed to more than $16 million in 2023, almost 200 times the median workers’ wages.
0:13:24 Sue Nabi, CEO of beauty products company Kodi, earned an eye-popping $149 million in 2023, while the median worker at the company earned $39,643.
0:13:37 Those employees would need to work for 3,769 years to earn what Nabi received in one, according to an analysis last year by the New York Times.
0:14:01 Lowe’s, meanwhile, spent $42.6 billion, buying back its own shares between 2019 and 2023, enough to have given each of the company’s 285,000 employees an annual $29,865 bonus for five years, according to the Institute for Policy Studies.
0:14:15 While CEO Marvin Ellison received $18.8 million in 2023, the retailer’s median annual worker pay was just $32,626.
0:14:23 Successful, independent businesses can’t lead the revolution, but should support it.
0:14:33 Not only can many companies increase their labor costs, they should, even if it takes a modest bite out of the earnings of the ownership class.
0:14:39 This makes financial and economic sense, while generating reputational benefits, too.
0:14:50 Think about companies that carry the fair trade stamp, guaranteeing farmers and workers receive a minimum price plus a premium payment to invest in improving their quality of life.
0:14:52 Companies are starting to get it.
0:14:53 Companies are starting to get it.
0:15:01 Bank of America has been raising its U.S. minimum hourly wage and pledges to hit $25 this year.
0:15:07 CEO Brian Moynihan expects to get payback in the form of lower turnover.
0:15:15 Globally, L’Oreal, Schneider Electric, and Unilever are among corporations that have committed to provide living wages.
0:15:24 Democrats shouldn’t lose sight of the extent to which this issue resonates with vast swaths of the American public.
0:15:32 Polling shows the long-debated idea of raising the minimum wage is popular with Republicans and Democrats alike.
0:15:44 For Kamala Harris, waiting until two weeks before the election to make a case for boosting the minimum wage to at least $15 an hour, felt $10 short and several years late.
0:15:55 Since 2000, corporate after-tax profits have surged roughly six-fold, while wages have only inched higher.
0:16:00 An economy that values work below the cost of living is broken.
0:16:08 An economy that does so while delivering massive profits to wealthy owners is a moral failure.
0:16:11 Inequality is a choice.
0:16:20 We have the power to give all Americans an opportunity to earn a wage that allows them to live a life of dignity.
0:16:23 What happens next is up to us.
0:16:30 CEOs and entrepreneurs should be bold.
0:16:42 Today, I’m making a commitment to pay my Prof. G contractors and employees at least $50 an hour or $100,000 a year in total compensation, respectively.
0:16:48 And I’m challenging other CEOs and entrepreneurs to join me.
0:17:06 A shit ton, minus half a million dollars each year, the cost for Prof. G Media to become a maximum wage firm, is fine.
0:17:11 It’s not only the right thing to do, it’s smart business.
0:17:14 If I sound like I’m virtue signaling, trust your instincts.
0:17:15 And that’s okay.
0:17:25 One of the biggest unlocks in my life has been recognizing that being a man means adding surplus value.
0:17:28 Creating more tax revenue than I absorb.
0:17:30 Listening to more complaints than I make.
0:17:32 Noticing people’s lives.
0:17:36 Providing more net care and love.
0:17:40 I have run firms my whole life.
0:17:46 And I’ve always aimed to provide the minimum compensation required such that employees won’t leave.
0:17:47 No more.
0:17:50 By the way, this is how nearly all companies work.
0:17:52 Optimizing for profits.
0:17:57 This is a result of the incentive system in a capitalist society.
0:18:01 As it increases the enterprise value, profits, of the firm.
0:18:04 And the likelihood the business survives.
0:18:10 Our entire society now prays at the altar of shareholder value.
0:18:13 Prioritizing them over every other stakeholder.
0:18:15 Dramatically.
0:18:21 If you are blessed with a company that’s doing well, why wouldn’t you pay more than you need to?
0:18:27 Do you love your kids, community, and country just enough that they don’t abandon you?
0:18:40 One of the most rewarding things about running a firm is it mimics some of the maternal or paternal feelings of reward you get from protecting and providing for your offspring.
0:18:47 I’ve worked hard, I’m talented, and I made the genius decision to be born in America.
0:18:52 The result is I’ve got a firm that’s exceptionally profitable.
0:18:57 One of the many rewards of that is I get to pay people more than I need to.
0:18:59 It feels great.
0:19:04 Life is so rich.

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0:02:23 Episode 342. Route 342 is an east-west highway in New York.
0:02:25 In 1942, Disney released Bambi.
0:02:29 I used to call my girlfriend Bambi, and she thought it was because she had big, beautiful eyes.
0:02:33 No, it was because I wanted to shoot her mother with a hunting rifle.
0:02:37 Go, go, go!
0:02:47 Welcome to the 342nd episode of the Prop G. Pop.
0:02:48 What’s happening?
0:02:50 The dog is home in London.
0:02:51 I’m back in London town.
0:02:53 People say, why did you move to London?
0:02:54 People always say that.
0:02:56 And I say, well, why am I in London?
0:02:59 I’m an influencer, not a decision maker on these issues.
0:03:04 The mother of my children said, seven years ago, we’re moving to London in five years,
0:03:05 or seven and a half years ago.
0:03:09 And then she actually called my bluff, came over here, bought a house, involved the kids
0:03:12 in school, and then boom, we’re in London.
0:03:13 So let’s stack rank London.
0:03:15 What’s the good?
0:03:15 What’s the bad?
0:03:16 People are like, do you like it?
0:03:17 Do you love it?
0:03:18 No, I don’t love it.
0:03:19 I don’t love it.
0:03:22 There’s some, let me start with the good.
0:03:24 It’s a world-class city.
0:03:31 I think mostly because it became a haven for private capital or wealthy people looking to
0:03:32 engage in tax avoidance.
0:03:35 And let’s be honest, that’s what you do when you get rich.
0:03:38 And part of the reason people are rich is because they’re obsessed with money and they think about
0:03:38 it a lot.
0:03:41 Things you’re obsessed with, you tend to be better at than things you’re not obsessed
0:03:47 with and Prime Minister Tony Blair at the time passed a series of private property laws that
0:03:51 said, if you’re a war criminal or an oligarch or just made a shit ton of money and you’re
0:03:56 worried about taxation, you can bring all your capital here and it’s safe and no one can come
0:03:57 for it and take it.
0:04:01 And also whatever money you keep offshore, we will not tax.
0:04:04 And if you think about it, well, you don’t get to do that in America.
0:04:08 If you make a bunch of money in businesses and Korea or whatever, and you repatriate it and
0:04:12 bring it home such as you can spend it on hookers and cocaine, that’s where I go.
0:04:14 That’s where the dog goes.
0:04:18 Then you get taxed on it, as you should be.
0:04:23 And in the UK, that money, as long as it stays outside of the UK, you don’t get taxed on it.
0:04:24 So we get a lot of rich people coming here.
0:04:27 Anyways, what do I like about the UK?
0:04:28 Let’s stack rank it.
0:04:29 It is a great city.
0:04:33 I’ve been coming to London for about probably 50 years.
0:04:38 I’ve been coming here since I was a wee one, since I was a wee skipper.
0:04:42 Because both my parents are from the United Kingdom.
0:04:44 My father from Glasgow, my mother from London.
0:04:49 And this place has slowly but surely gotten the mother of all facelifts over the last 50 years.
0:04:51 In the 80s, this was not a nice city.
0:04:53 The food sucked.
0:04:56 The infrastructure was crumbling.
0:04:58 There weren’t a lot of innovative businesses here.
0:05:00 It just wasn’t where you would decide to spend a lot of money.
0:05:06 Now it really is sort of the most probably livable city if you’re coming from America and an English speaker.
0:05:08 So there’s really interesting people.
0:05:09 It is a world-class city.
0:05:11 Premier League football, another amazing thing.
0:05:15 Best thing about the UK, in my view, proximity to the continent.
0:05:18 And also, I will say that people are very welcoming here.
0:05:21 You come here and people immediately say, oh, you’re new?
0:05:23 I had someone come up to me in the park and say, oh, you’re new?
0:05:23 Come over.
0:05:24 We have dogs.
0:05:25 We’ll have dinner.
0:05:26 I’m not comfortable with that.
0:05:31 I don’t want to go to strangers’ house for fear that I walk in and it’s sort of weird and I think I’m trapped here for two and a half hours.
0:05:34 But anyways, people have dinner parties when you arrive.
0:05:35 Very, very nice.
0:05:37 I found it very warm and welcoming culture.
0:05:38 The downside.
0:05:39 The downside.
0:05:46 The second worst thing about it here, the business environment is really anemic, comatose.
0:05:50 I just don’t find there’s the same entrepreneurial flair.
0:05:56 I don’t know what it is, but I have found that the majority of the economy here is about serving wealth that’s been created elsewhere.
0:05:59 That there isn’t a lot of organic value creation.
0:06:04 Not a lot of, most of the entrepreneurs are starting businesses to serve money made elsewhere.
0:06:05 They’re starting a restaurant.
0:06:07 They’re starting a wealth management company.
0:06:08 They’re starting a hotel.
0:06:11 There’s very little, I think, of a tech scene here.
0:06:12 I mean, a little bit.
0:06:13 A little bit of payments.
0:06:20 But it’s just not that same risk-taking infrastructure, whatever you might want to call it.
0:06:23 By far, the worst thing about it here, oh my God, the weather.
0:06:25 Jesus fucking Christ.
0:06:27 It’s cloudy and gray and 52 degrees.
0:06:28 Whoa.
0:06:31 Good news is it’ll be like that for the next, I don’t know, seven years.
0:06:32 Oh my God.
0:06:35 It is just, I don’t really, I didn’t realize.
0:06:38 I’m going to be, I’m absolutely going to retire to like Arizona or something.
0:06:38 Not true.
0:06:39 Retiring to Aspen.
0:06:40 Retiring to Aspen.
0:06:44 Because the sun, at least for me, I have that disorder, seasonal disorder.
0:06:45 I don’t know.
0:06:46 Is that really a disorder?
0:06:47 Wanting to have sun all the time?
0:06:50 But oh my gosh, I just can’t handle it.
0:06:51 I just cannot handle it.
0:06:53 We’ve been here two and a half years.
0:06:54 Oh, I forgot.
0:06:54 Actually, you know what?
0:06:55 Best thing.
0:06:59 The best thing about the UK is the schooling system.
0:07:01 The schools are great here.
0:07:05 My two boys are so happy, thriving, doing great in school.
0:07:07 Oh, another free gift would purchase.
0:07:12 I don’t have horror fantasies about waking up or getting up and turning on the TV and seeing
0:07:14 my kids school in the news because of a mass shooter.
0:07:15 You just really don’t have that here.
0:07:16 Why?
0:07:17 Because they’re fairly reasonable people.
0:07:22 Anyways, that’s my breakdown of the UK, the United Kingdom.
0:07:28 I would say to anyone who has the pleasure or the luxury or is fortunate enough to ever live
0:07:30 abroad, I absolutely think you should.
0:07:32 I could not do better than my life in the U.S.
0:07:34 I will not do better than my life in the U.S.
0:07:34 I love it there.
0:07:35 I am very American.
0:07:37 I didn’t realize how American I was, so I left.
0:07:39 But you don’t want to do better.
0:07:40 What you want to do is different.
0:07:44 And if you have the resources or the opportunity to live abroad, you should.
0:07:46 And I think there’s kind of two times when you figure it out.
0:07:47 One, when you’re young.
0:07:49 Because when you’re young, you can dance between the raindrops.
0:07:52 You can just go out, have a pint, meet friends.
0:07:53 You don’t have to live in a nice place.
0:07:55 You’re more flexible.
0:07:57 If it’s not great for your career, you can recover.
0:07:59 Or, quite frankly, when you have a lot of money.
0:08:01 And I know that sounds douchey.
0:08:02 Oh, we should all be able to move to Europe.
0:08:03 Yeah, but you can’t.
0:08:06 The reason I moved to Europe, people say, oh, you wanted to get out of the U.S.
0:08:07 because of Trump.
0:08:07 No, not at all.
0:08:11 I’m here because of the U.S., not because I wanted to leave.
0:08:13 I’m here due to the prosperity I recognize in the U.S.
0:08:17 And the reality is, in a city like London or living in Europe, especially with a family or moving,
0:08:20 you just need to lubricate it with a lot of money.
0:08:23 It’s probably true if you want to live in New York or San Francisco or L.A.
0:08:28 But still, the reason I’m in Europe is because America let me.
0:08:30 All right, moving on.
0:08:34 In today’s episode, we speak with Ezra Klein, the New York Times columnist and host of The Ezra Klein Show,
0:08:38 and Derek Thompson, Atlantic staff writer, author, and host of The Plain English Podcast.
0:08:44 We discuss with Ezra and Derek their new book, Abundance, which is all about how America learned to fail at abundance
0:08:48 and how the left can fix it by embracing growth, progress, and the messy tradeoffs of governing.
0:08:50 So I did enjoy this conversation.
0:08:53 I mean, something that plagues the United States.
0:08:54 It’s interesting.
0:08:59 Derek and Ezra would say that the left suffers from sort of the bureaucratic state,
0:09:04 you know, 12 times as much to build a mile of subway in New York versus Paris,
0:09:05 which isn’t known for its efficiency.
0:09:09 We spent all this money on charging stations and none of them happened.
0:09:13 I don’t know if that’s something that just plagues the left, quite frankly.
0:09:19 Although what’s interesting is that kind of these Republican-run cities just seem to be better run right now
0:09:20 than democratically-run cities.
0:09:22 But anyways, that is what it is.
0:09:24 I enjoyed it.
0:09:26 They’re both really fascinating guys.
0:09:27 Derek’s at The Atlantic.
0:09:29 Ezra is at The New York Times.
0:09:31 They’re both just super thoughtful guys.
0:09:33 And also, they seem like nice guys.
0:09:35 And I’m glad they’re doing so well.
0:09:37 And I enjoyed having them on the pod, as will you.
0:09:41 So with that, here’s our conversation with Ezra Klein and Derek Thompson.
0:09:47 All right, let’s bust right into it.
0:09:48 Gentlemen, where does this podcast find you?
0:09:49 Ezra, where are you?
0:09:50 I am in New York.
0:09:52 You’re in New York.
0:09:52 And Derek?
0:09:55 I am in Chapel Hill, North Carolina.
0:09:56 Nice.
0:09:57 We were just talking about it.
0:09:59 I’m doing a college show with my son.
0:10:01 And he’s decided that he’s interested in UNC.
0:10:01 And I asked him why.
0:10:02 And he said, because of the logo.
0:10:06 And I thought, well, that’s absolutely the right reason to pick a university.
0:10:13 Your new book, Abundance, is about where America, liberalism, and the Democratic Party went wrong over the last few decades.
0:10:17 You argue that right-wing populism thrives on scarcity.
0:10:20 And the answer is abundance.
0:10:21 Let’s start there.
0:10:23 What does that abundance look like?
0:10:24 I’ll start with you, Derek.
0:10:31 I think abundance is a positive vision of the future that liberals can build if we get out of our own way.
0:10:34 And I think it starts first with actually having a goal.
0:10:37 This book is about politics, and it’s about policy.
0:10:48 But it opens actually with a sci-fi vignette of what the world of 2050 could look like if we get everything right in housing, in energy, in science, in technology, in governance.
0:10:50 But these are different markets.
0:10:51 And different markets have different problems.
0:10:53 And they have different bottlenecks.
0:10:58 And so part two, after you have a goal of where you want to go, is understanding what industries you’re actually working in.
0:11:14 And a lot of this book is looking back over the last 50 years at how housing policy went wrong, often in blue cities, and how we failed to build clean energy in this country, even when liberal cities and liberal governors tend to say that they want to build clean energy to help climate change.
0:11:24 And then finally, I think that abundance requires us identifying the bottlenecks that are in our way and the policies that we don’t have yet that could improve our outcomes.
0:11:35 So, for example, I think it’s pretty remarkable that when you think about how important science and technology are to improving people’s health and improving people’s lives, this country doesn’t have a national invention agenda.
0:11:47 So, you might expect that Elon Musk, now that he’s associated himself with the MAGA movement, would inscribe a kind of wise techno-optimist idea within that party.
0:11:47 He hasn’t.
0:11:49 He has no vision of what America can be.
0:11:52 He has a vision of what he wants to tear down.
0:12:03 And so, we believe very strongly in having a positive vision for the future, understanding the world and where we’ve gone wrong, and then finally, in resolving the bottlenecks to actually build that future.
0:12:05 Ezra, any additional color there?
0:12:15 I mean, I’ll give our one sentence, which is that the thesis of abundance is that to have the future we want, we need to build and invent more of what we need.
0:12:19 Okay, so, abundance is a really nice word.
0:12:21 Tell me on the ground what that means.
0:12:22 Let’s talk about energy.
0:12:23 Does that mean drill, baby, drill?
0:12:27 Like, how does this notion of abundance impact our energy policy?
0:12:38 So, I often get this question of, if you think we’ve gone wrong in so many places, if you think the government has hindered so much construction, so much innovation, why are you not just a conservative?
0:12:40 Don’t we already have a Republican Party?
0:12:50 The world you are trying to achieve matters, when there’s actually a huge disagreement I have with things like Doge, which is efficiency towards what?
0:12:54 I hear all these tech-right people tell me that they’re readying the government for AI.
0:12:57 And I’m like, okay, AI that does what?
0:12:59 What is its value function?
0:13:00 What is its prompt?
0:13:01 What are you unleashing it on?
0:13:02 You have to know what you’re trying to build.
0:13:09 And the, I think two of the core tributaries of the book are housing and decarbonization.
0:13:19 We are very, very worried about the absence of sufficient housing in the big, particularly the cities, although not only, that drive the American economy.
0:13:23 And we’re simply not going to meet decarbonization goals.
0:13:25 I mean, we’re probably at this point not going to meet them anyway.
0:13:36 But you’re not going to meet decarbonization goals if you can’t build solar, wind, battery manufacturing facilities, and other things at a much, much, much faster pace than we’ve seen so far.
0:13:43 And that are frankly possible under the way liberal governments, including national and democratic governments, tend to create the rules for construction.
0:13:48 So, yeah, our theory is not just more of everything.
0:13:52 I think we have a line in the book that it’s not an omnidirectional mournness.
0:13:54 You have to choose what you need more of.
0:14:00 Look, we’ve had also, as you know better than anybody, Scott, abundance of consumer goods for a long time.
0:14:12 And behind that abundance of consumer goods where, you know, 40 years ago, you could go to public college debt-free, but you couldn’t have a flat-screen television anchored on your wall in your house.
0:14:17 Now you probably can’t go to college, public college debt-free, and you can have a flat-screen television.
0:14:24 So we kind of constructed government and the global economy to make the things that fill a house cheap and the things that build a life expensive.
0:14:35 Child care, health care, education, housing, energy, and a set of other things that we think of as more of the building blocks of production and the building blocks of flourishing.
0:14:42 And so we, in the book, sort of run through these, not just at a policy level, but also at a more conceptual level, sort of one by one.
0:14:53 Housing, energy, state capacity, these structures that lead to invention, and then the structures and ways we turn that invention into actual technology that is produced in a way people can use.
0:15:07 You have to choose, and if there’s any one, I think, pathology we are pulling at inside the way liberals govern, and we’re both, you know, American liberals, it’s that we often don’t choose.
0:15:16 We lard things up with too many goals, too many standards, too many regulations, and we don’t take seriously that if you’re going to achieve anything, you need to focus on achieving that thing.
0:15:20 Again, anything done well is hard, and we pretend it’s easy and then act surprised when we fail.
0:15:26 So, Derek, I love the idea of abundance, but I’ll put forward a thesis and you respond.
0:15:29 We don’t suffer from a lack of abundance.
0:15:39 What we suffer from is this oligarchical zeitgeist where we’ve decided to optimize the U.S. for the top 1%.
0:15:43 And we don’t suffer from an increase in market capitalization and an increase in wealth.
0:16:01 What we suffer from is policies that essentially insert certain companies in between the consumer on some public goods, including health care, housing, prison system, where the objective or the metrics are shareholder value, not the public good.
0:16:04 The private company inserts themselves in the middle.
0:16:05 It does a great job.
0:16:13 Innovation applies to technology and then creates market power, raises the prices, and we end up with one in four households with children.
0:16:25 I mean, quite frankly, just to sound like a liberal, isn’t our problem not abundance, but quite frankly, that we are slowly but surely sequestering all the abundance to the 1%?
0:16:32 Sometimes I would say the answer to our problems is that the oligarchy is getting in the way of achieving our outcomes.
0:16:36 But let’s talk about housing for a second.
0:16:40 Why is it that California has the worst affordable housing crisis in the country?
0:16:47 Why is it that the five states with the highest rates of homelessness are all states that are governed by Democrats?
0:16:52 Is it because the oligarchy is stronger in democratic states?
0:17:10 Or is it because in place after place governed by Democrats, we have allowed habits and customs and rules and regulations to get in the way of what you and I and Ezra all want, which is more housing supply?
0:17:20 Right. Scott, your last great note for your last great newsletter was about housing being the most important topic for the 2028 election.
0:17:26 Right. We have seen the average age of first time homeowners go from 25 to 37 years old.
0:17:36 We now have a record high number of young people who say they cannot afford a home because the cost of housing as a share of average incomes has gone up and up and up.
0:17:45 Of course, I think sometimes the problems in housing have to do with incumbents, but sometimes the problems in housing have to do with us ourselves and the rules that we write.
0:17:54 So you look at a place like Portland, Oregon, in Portland, Oregon, every single mayor and every single governor that’s elected says housing is our priority.
0:18:03 But if you ask, can we build outside of the current lines that are drawn by the 1972 land use laws, they say, no, we can’t do that.
0:18:13 If you ask if you can build a new apartment building that blocks a view of Mount Rainier, they say, actually, our view of Mount Rainier is more important than the additional than additional new housing units.
0:18:21 So I do think that, of course, there are many situations where the most important problem to focus on is the problem of entrenched money.
0:18:34 But in many cases, for the issues that you and I care most about, which is housing supply and housing abundance, I think we need to take a good long look in the mirror and recognize something I think has gone wrong on our own side.
0:18:51 If the cities and the cities that have the worst housing crisis are also governed by liberals and also I would say the cost of escalating housing prices is not just seen in how much housing is eating up the budgets of people who live in these cities.
0:18:54 It’s also the people who are leaving these cities.
0:18:56 California is losing people.
0:18:58 New York State is losing people.
0:18:59 Illinois is losing people.
0:19:01 Minnesota is losing people.
0:19:12 Working class families, as Ezra just said in his beautifully done new video for The New York Times, working class families are leaving blue states and moving to states that are more likely to be governed by Republicans.
0:19:25 Of course, there are all sorts of indictments that we can make of the power of oligarchy in this country, and we can talk about the many ways that Elon Musk is turning government into some kind of kleptocratic mania.
0:19:34 But look, if we’re really trying to understand why is the housing crisis worse in blue states and blue cities, I think we need to look in the mirror as well.
0:19:43 Ezra, you talk about or you say in the book that for a future that’s pro-growth, pro-technology, and has pro-liberal values.
0:19:46 What does that actually look like in practice?
0:19:47 Give me more.
0:19:56 Well, let’s talk about, I mean, beyond just clearing out, going from NIMBY to YIMBY like they’ve done in Austin or in Minneapolis.
0:20:09 Give me an example beyond housing of how kind of a pro-technology, pro-growth, and pro-liberal values, how that actually impacts things on the ground.
0:20:19 I think you guys could have written your book just on housing because I think what you’re saying really resonates with people where we’ve turned it into an investment class and turned over housing permits to homeowners and took it out of the hands of bureaucrats.
0:20:22 And homeowners have an incentive to restrict the supply.
0:20:29 But give me another example in another sector of how you think kind of being pro-tech and pro-growth might change our current approach.
0:20:31 Yeah, let’s talk energy because I think energy is a useful one.
0:20:41 Imagine a world where it just turned out we never invented a form of energy that didn’t require burning fossil fuels, right?
0:20:42 We figured out natural gas.
0:20:44 We figured out oil and petroleum.
0:20:45 We figured out coal.
0:20:48 But we never invented the solar panel.
0:20:50 We never figured out what to do with a wind turbine.
0:20:53 Didn’t figure out hydropower or geothermal.
0:21:12 You would have this, I think, politically impossible problem, which is that the only way to do anything about greenhouse gas emissions would be to radically cut the living standards of functionally everybody who uses energy around the globe, right?
0:21:14 There just wouldn’t be another way around it.
0:21:16 You could try to make your burning of coal more efficient.
0:21:23 But if we did not keep moving the technological frontier forward, I mean, I grew up, I don’t know where you grew up, Scott, but I grew up outside L.A.
0:21:26 And when I grew up, you still had L.A. coated in smog.
0:21:30 You would still go in and you’d be like looking at this.
0:21:34 You’d think, is it cloudy or can I not breathe today?
0:21:35 Yeah, I remember, I grew up in L.A.
0:21:38 I remember coming home from school and your chest would hurt when you breathe in.
0:21:38 Yep.
0:21:43 And what’s crazy today, and it’s a way I think you know that the only future is not degrowth.
0:21:46 What’s crazy today is L.A. is richer.
0:21:47 It’s bigger.
0:21:48 And you can breathe the air.
0:21:50 And that happens in a lot of places.
0:21:53 I mean, London used to be unfathomably smoggy.
0:21:55 I mean, go back to any writing about the Industrial Revolution.
0:21:57 So, OK, so we didn’t end up in that world.
0:22:04 We ended up in a world where due to a series, by the way, of policies, right, government funding of research,
0:22:09 the German subsidies, particularly for solar, Chinese subsidies for the solar industry,
0:22:15 we ended up over the past 10, 15 years driving the price of solar down by 90 percent,
0:22:18 driving the price of wind down, I think it’s by 79 percent,
0:22:21 and the battery storage around by something comparable.
0:22:25 It is only because of that genuine set of technological miracles,
0:22:28 and I don’t use miracles here to mean just luck, right?
0:22:30 That was a huge amount of policy and human ingenuity.
0:22:37 Do we have any capacity to have a politics around climate change that is not just a politics of sacrifice,
0:22:40 because politics of sacrifice do not typically work,
0:22:46 and they have a terrible tendency to elect strong men from the authoritarian right.
0:22:49 You go to people and you say, we’re going to cut how much energy you have.
0:22:50 We’re going to ration your energy.
0:22:52 Nothing destabilizes a polity faster.
0:22:54 Think about the Yellow Vest riots in France.
0:22:57 Think about how Kamala Harris, in a time of high energy prices,
0:23:01 was running not on the climate investments of the Biden-Harris administration,
0:23:05 but on the oil and gas production increase of the Biden-Harris administration.
0:23:11 So one of the aims of the book is to repair what we think of as a dysfunctional relationship
0:23:14 that has emerged between liberals and technology.
0:23:18 There is a tendency to put technology, I think practically after 2016,
0:23:21 it’s run by a bunch of oligarchic billionaires.
0:23:25 There’s a ton of, certainly in the liberal mind, disinformation and propaganda on Facebook.
0:23:27 Liberals sort of turn on technology.
0:23:30 But there’s a lot you just can’t solve without technology,
0:23:35 and a lot about your politics that really change if you get the right technological advancements.
0:23:37 We’re saying we’re not using housing for this example,
0:23:42 but modular housing would do a lot to change the politics of housing if you could use them
0:23:45 in a lot of cities because you could do public housing much more cheaply,
0:23:48 and you could also do non-public housing much more cheaply.
0:23:56 Energy and continued advance in things like modular nuclear could really, really, really make possible a situation
0:24:03 where you could have countries like China and India continue to grow and continue to give people vastly better lives
0:24:05 while also cutting carbon emissions.
0:24:08 It could leapfrog the kind of development we went through.
0:24:10 It’s also true for healthcare.
0:24:15 So I spent a lot of my career as a reporter on healthcare policy,
0:24:19 and sort of my intention in that reporting is I care about universal healthcare policy.
0:24:21 I was all over Obamacare and the Affordable Care Act.
0:24:25 But how valuable having any kind of health insurance is,
0:24:27 how valuable having private health insurance is,
0:24:29 how valuable Medicare is, Medicaid is,
0:24:35 is dependent on what devices, treatments, surgeries, pharmaceuticals are there.
0:24:39 Medicare and Medicaid that cover Ozempic is more valuable than Medicare and Medicaid
0:24:42 that does not cover Ozempic or Wagovi or the other ones.
0:24:46 And if it didn’t exist, they would all be less valuable, right?
0:24:50 There are people with huge numbers right now of autoimmune conditions we don’t understand.
0:24:53 These insurance products would be a hell of a lot more valuable to people
0:24:56 if we knew how to cure those and the insurance could cover the cures.
0:25:00 So there is a lot you just can’t do if you don’t innovate.
0:25:02 If we don’t figure out green cement and jet fuel,
0:25:04 we’re not hitting our climate targets one way or the other.
0:25:11 So liberalism has to have a technological agenda in addition to a social insurance agenda.
0:25:15 And that means taking the mechanisms and institutions of technological progress
0:25:19 and then the distribution of the fruits of that technological progress seriously.
0:25:23 So, Derek, when we talk about energy policy,
0:25:25 just to steel man this,
0:25:32 that the very Republican state of Texas is now producing more wind energy than anyone,
0:25:34 and that economics ultimately wins out.
0:25:36 Or that’s a case study.
0:25:39 And ultimately, that creates less bureaucracy,
0:25:42 let the market decide, more wind energy,
0:25:43 lower cost of energy,
0:25:46 more tax revenue to reinvest in our schools.
0:25:50 Isn’t the conservative agenda more of an abundance agenda?
0:25:51 It’s interesting.
0:25:53 We’ve gotten a version of this question a few times.
0:25:54 I think it’s a really good question.
0:25:58 Certainly, Texas and Texas politicians do not have, as their North Star,
0:26:02 the idea that climate change is the most important policy in the world, right?
0:26:06 It is liberals and it’s progressives who have all of the backpack pins that say,
0:26:08 let’s ban oil and let’s fix climate change.
0:26:12 Nonetheless, as you point out, you can’t ignore the fact of outcomes.
0:26:15 It is Texas that is building the most renewable.
0:26:20 And it is often places like Georgia and Iowa, not run by Democrats,
0:26:25 but run often by Republicans who do not value climate change as a top-order priority,
0:26:27 that are building the most renewable energy.
0:26:30 And that speaks to the fact that in some cases,
0:26:36 if you allow a market to work without the interference of NIMBY politics,
0:26:42 you sometimes, ironically, end up with more progressive outcomes.
0:26:46 This is as true in energy as you could say it is in housing.
0:26:52 What stands in the way of housing in San Francisco, in Los Angeles, in Boston, in Portland,
0:26:55 is not demand to live there.
0:26:57 It’s constrictures on supply.
0:27:02 And in the same way, I think there are people in California and New York who want to build,
0:27:06 and Massachusetts, who want to build more solar and want to build more wind,
0:27:13 but they can’t do it because the political processes in these states have gotten so good
0:27:17 at the politics of blocking that they’ve prevented the politics of building,
0:27:21 even building things that are in liberals’ interests,
0:27:27 houses, solar, wind, geothermal, even, if you’re a certain kind of progressive, nuclear.
0:27:31 So I think you’ve put your finger on a really, really important tension
0:27:35 between the processes that liberals have and the outcomes that they want.
0:27:43 Why are our outcomes living in Texas if our priorities live in San Francisco?
0:27:49 That is an incredibly important question for the progressive movement to ask itself
0:27:54 if it wants to answer the question and actually build the things that we say we want to build.
0:27:56 We’ll be right back.
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0:30:39 Ezra, I see the epicenter of all the things you’re talking about or the perfect storm of bad things,
0:30:45 whether it’s an obsession with scarcity or the administrative state getting in the way of objectives
0:30:47 or kind of losing the plot.
0:30:50 I think the epicenter for everything you guys are talking about is my industry,
0:30:56 where you have, when the dean announces we’ve rejected 85% of applicants,
0:30:57 what do the faculty and the alumni do?
0:30:58 They stand up and they applaud.
0:31:04 I’m curious if you’ve thought about how this scarcity or non-abundance mindset
0:31:10 has infected higher education and what policy recommendations you guys would make
0:31:11 to address this problem.
0:31:13 I’ve thought about it a bit.
0:31:15 Higher ed is not a huge focus of the book.
0:31:19 But in some earlier, some Californian, and in some earlier work,
0:31:24 one of the things I think about in terms of what happened to the California of the past,
0:31:29 I don’t think there is a greater public achievement,
0:31:33 certainly not in education, in the world than the University of California system.
0:31:34 Oh, right on, my brother.
0:31:38 Literally, right the fuck on.
0:31:44 I am here because of the generosity of California taxpayers and the regents of UC.
0:31:45 Anyway, sorry, I was going to go ahead.
0:31:46 It’s an extraordinary…
0:31:47 I went to UC Santa Cruz.
0:31:47 I went to UCLA.
0:31:52 Right, like I am a full-on product of California public schools through California higher ed.
0:31:54 What was your tuition when you were going?
0:31:56 It was a long time ago.
0:31:59 I don’t remember it offhand.
0:32:01 I’m worried I’m going to give you the out-of-state.
0:32:02 Mine was $7,000.
0:32:06 I think mine was like, yeah, it was like $10,000, I believe.
0:32:10 Mine was $7,000 for all seven years of undergrad and grad.
0:32:13 Do you remember the admissions rate at UC when you applied?
0:32:14 No.
0:32:18 For me, at UCLA, it was 76% when I applied.
0:32:18 And I was one of the 24%.
0:32:19 Do you want to hear something?
0:32:22 So, UC had, when I was in…
0:32:24 I was a shit student.
0:32:26 I had a 2.2 when I graduated high school.
0:32:28 You had a lot of trouble paying attention.
0:32:32 UC had a thing then called eligibility.
0:32:35 And it was a sliding scale.
0:32:46 But if you got above a 3.3 or above a 1,400 on your SATs or something in between that sliding scale, you were guaranteed admission to Riverside or Santa Cruz.
0:32:52 No, by the time I went, UC, I wasn’t doing eligibility anymore because they were too blocked up.
0:32:53 I don’t know if any of them do it anymore.
0:32:56 But when I went, that’s how I got into Santa Cruz.
0:32:58 I qualified in on test scores.
0:33:13 But the thing is, like, in my lifetime and well before it, having built the most remarkable public university system the world has ever known, and, like, take nothing away from Cal State or the community colleges there, which are also great, they added exactly one UC campus Merced.
0:33:16 Fuck did we stop building UCs for?
0:33:18 Did California stop having people?
0:33:20 Did we stop needing great universities?
0:33:29 But I’ve, like, looked into this, and, I mean, one is, oh, my God, like, the fighting in the legislature over where to go and, you know, who gets it and whose ox gets gored.
0:33:35 And we just stopped building a bunch of different kinds of things.
0:33:38 We can’t build high-speed rail, but we also don’t build new UCs.
0:33:41 You know, we don’t build houses, but we also don’t build enough clean energy.
0:33:48 I think the other thing I would say, because I do agree with you, Scott, and have pretty intense views on this, I don’t know.
0:33:55 I have people I respect who will tell me, well, you know, if you double or triple the size of Harvard, it wouldn’t be Harvard anymore, and it would lose quality.
0:33:56 I don’t know that I buy that.
0:34:01 But you could sure as hell open these places up to a lot more innovation.
0:34:06 You could sure as hell do a lot of new things and put a lot of money into new institutions.
0:34:09 And I wonder about the fact that we don’t.
0:34:12 There was a good piece in The New Yorker recently by Adam Gopnik.
0:34:16 It’s not what we’re here to talk about, but here’s what we’re talking about, about the Gilded Age.
0:34:25 And he was making this point about how the robber barons were monsters in a million different ways.
0:34:27 They’re also remarkable in other ways.
0:34:32 But, man, did they leave behind cultural institutions and institutions of learning.
0:34:33 Vanderbilt’s a great university.
0:34:34 Really is.
0:34:36 What are they all doing today?
0:34:39 What are they all doing today?
0:34:41 And he was, like, making the point about museums and art.
0:34:46 I was in Pittsburgh for a family event recently.
0:34:49 And, man, the museums there are great.
0:34:58 We have, like, the federal government has stopped building, but also there’s nothing like the construction of cultural institutions that the rich did in that era.
0:35:12 The rich of this era are building their personal rocket companies and getting their yachts, but they’re not creating, like, new institutions of local or, for that matter, national value.
0:35:19 So there’s something, I think, about our institutional, our absence of institutional ambition.
0:35:27 Elon Musk sure has the ambition to destroy things that have been built in the public sector, but not to make new ones.
0:35:29 And you just kind of see this replicated.
0:35:43 There is, as we stop, the narrow version of this is that as we find that we cannot build rail at any acceptable cost point, we do a lot of less building of rail with tunnels in it because tunnels are expensive and they’re difficult to do.
0:35:47 In other countries, you do a lot more tunneling because they still believe they can build rail.
0:35:52 And when you believe you can build rail and actually finish it on time and on budget, you’ll do the hard versions of rail, which include tunnels.
0:35:55 And I think there’s something like that that is infected.
0:36:05 A lot of state governments, for that matter, the federal government, and a lot of societies wealthy where they just don’t really believe in building great new institutions.
0:36:31 I think it’s impossible to argue against the notion that we used to have these individuals of extraordinary talent that would practice full-body contact violence of capitalism and then became very civic-minded with the spoils of that full-body contact violence of competition.
0:36:34 It appears now we have the former and not the latter.
0:36:40 My fear, though, is that waiting on the better angels of these billionaires to show up is not a strategy.
0:36:47 And that I have now become – I’ve kind of just gone full Bernie Sanders and I’d like you both to respond to this.
0:36:51 And I believe that we just need a massive alternative minimum tax.
0:36:54 My tax rate for the last 10 years has been 17 percent.
0:36:58 I’m very transparent about – from my 30s and 40s, I was averaging over 30 percent.
0:37:01 Then I got very wealthy and my tax rate has been cut in half.
0:37:15 I mean, in order to make these sorts of big, bold investments in rail, in UC, and still have the money to pay for our defense department, Medicaid, Medicare, doesn’t it simply, quite frankly, just come down to restoring a progressive tax policy?
0:37:16 Derek, any thoughts?
0:37:18 Sure.
0:37:21 I’m absolutely a fan of restoring progressive tax policy in this country.
0:37:29 You know, we’re progressives in the American tradition, which means that we believe in big, muscular programs in the style of the New Deal.
0:37:31 We believe in Social Security.
0:37:32 We believe in Medicare and Medicaid.
0:37:45 We know that we’re going to continue to have to spend hundreds of billions of dollars on defense, not only to defend the country, but also to invest in military technology to keep Americans and countries that have American values safe.
0:37:48 But also, yes, institutions cost a lot of money.
0:37:53 Next-generation energy costs money to build, and sometimes it even costs money to subsidize, right?
0:37:59 Fusion technology does not exist right now, and getting it off the ground might be a very expensive enterprise.
0:38:03 The same with building high-speed rail across the country, if that’s what we want to do.
0:38:09 So absolutely, I believe that progressivism requires sufficient funding.
0:38:18 But I also think that an important part of this book, an important framework of abundance, subtly nudges the question toward the opposite side of the ledger,
0:38:33 which is how do we solve the problems that we have with supply, not the demand that comes from taxpayer money, which is important, but also the strategy that comes or the outcomes that come from expanding supply.
0:38:39 In a way, that’s the unspoken question that we’ve been circling around this whole conversation.
0:38:46 In housing, how do we solve the affordable housing crisis with supply, with not reducing a corporate income tax,
0:38:53 but actually reducing a building tax in the cities that have the highest demand for housing and where we have the highest rates of homelessness?
0:38:59 In energy, how do we make it easier to build not only oil and drilling and fracking for natural gas,
0:39:07 but also building the next generation of key energy technology and solar, wind, geothermal and beyond, even nuclear, even in science institutions?
0:39:13 The answer to your question, how do we deal with the fact that education and college costs in this country have gone through the roof
0:39:18 and it is prohibitively expensive now to afford four years of excellent elite college in this country?
0:39:21 Well, how do we solve that problem with supply?
0:39:27 How do we train our eyes on the fact that the UC system essentially stopped building new branches and new schools?
0:39:29 And in fact, it’s not just the UC system.
0:39:34 I mean, name an elite college that has been founded in the last 100 years.
0:39:39 I think two of the last ones that are in to the top 25 of any kind of U.S. News and World Report ranking
0:39:42 are things like Chicago and Stanford, which are over 100 years old.
0:39:46 It’s been a century that we’ve taken a time out from building the kind of institutions
0:39:52 that we used to spring up and pop up every five years in the last half of the 19th century.
0:39:57 And to Ezra’s point, I don’t think it’s a coincidence that the same time that we were inventing things left and right
0:40:03 and building houses and building roads and building canals and building telegraph wires in the late 19th century,
0:40:05 we were also building institutions.
0:40:12 And there was some strange thing in the air that even some of the most unethical people in this country
0:40:18 who did stuff like Rockefeller did to the trade industry of using his monopoly power
0:40:20 to essentially shut down companies and start riots,
0:40:23 nonetheless had a bone in his body that said,
0:40:28 I want to use my money to build something new that doesn’t exist yet.
0:40:32 Why doesn’t that bone exist in the bodies of billionaires today?
0:40:36 So I do think that on top of your very important point,
0:40:40 that a critical part of shoring up government finances in the next generation
0:40:42 is going to be having sufficient tax revenue,
0:40:45 and that sufficient tax revenue is going to be necessary to build a lot of the things
0:40:48 in the physical world, expensive things that we want to build.
0:40:50 I also want us to think about the question,
0:40:53 how do we solve this problem with supply?
0:40:57 And think about all the various stations and departments and corners
0:41:02 that that question can apply to even outside of the scope of our book,
0:41:06 which is, as we’ve said, focused so much on housing and energy and science.
0:41:10 I want to say these questions are not distinct from each other.
0:41:17 And I really want to say here, look, I will tax a rich to any level anybody wants to tax a rich.
0:41:25 I think the marginal value of those dollars, they’re just points on a board at a certain point,
0:41:27 and you should be taxing the shit out of them.
0:41:30 And we still got to use that tax money well.
0:41:39 And the reason California has not built, has absolutely failed to build high-speed rail is not tax dollars.
0:41:41 We tax plenty in California.
0:41:45 And China has a hell of a lot less in tax dollars per capita than we do,
0:41:51 and they’ve built 23,000 miles of high-speed rail in the time California has failed to build 500.
0:41:55 In New York City, in New York State, taxes here are high.
0:41:58 It’s a fairly high-tax jurisdiction, at least compared to other places.
0:42:06 The 2nd Avenue subway, highest cost per kilometer of rail ever recorded in human history.
0:42:14 There’s no amount of taxing we can do that is going to allow us to build a bunch of subway if it’s all going to cost like that.
0:42:17 And by the way, the next phases are projected to cost more.
0:42:19 We have to use taxpayer dollars well.
0:42:23 And the fact that rich people have too much money and we should tax more of it
0:42:27 doesn’t exempt us from the need to use taxpayer dollars well.
0:42:32 And I think this is a conceptual and political mistake Democrats and liberals make a lot.
0:42:34 Because taxing the rich is popular.
0:42:35 It’s great.
0:42:38 But the reason people don’t trust us on all kinds of things,
0:42:40 and something I try to keep telling people,
0:42:43 is like, yeah, Donald Trump won in 2024 on cost of living.
0:42:46 He won because people trusted him on inflation over Democrats.
0:42:50 But if you go look at exit polls in 2020, when people were tired of Donald Trump,
0:42:53 he was even with Joe Biden on the economy.
0:42:57 And if you go look at 2016, he was ahead of Hillary Clinton on the economy,
0:42:59 even as he lost the popular vote.
0:43:02 People do not trust Democrats on the economy.
0:43:04 They don’t trust Democrats to spend your money well.
0:43:07 And part of the reason is we often don’t spend people’s money well.
0:43:11 Now, Musk and Trump don’t give a shit about where money is being spent well and poorly.
0:43:15 They’re trying to gut the Social Security Administration, which spends money incredibly effectively.
0:43:17 Incredibly effectively.
0:43:18 They’re gutting the IRS.
0:43:22 And when you cut people at the IRS, they don’t audit rich people and you lose money, right?
0:43:24 They’re not trying to save money.
0:43:26 They’re not trying to make government more efficient.
0:43:32 But there is not an amount of money we can tax people where that is going to lead to the kind
0:43:35 of public infrastructure we want if we cannot build that public infrastructure.
0:43:38 AOC has a bill to do more public housing.
0:43:39 That’s great.
0:43:41 I want public housing to be palatial.
0:43:43 I want it everywhere.
0:43:48 But if we force public housing to operate under the rules that it currently does, which makes
0:43:50 it much more expensive to build public housing.
0:43:55 Brandon Johnson, the mayor of Chicago, just tweeted out trying to brag about this, that
0:43:59 they had spent, I think it was $1.1, what was it, $11 billion?
0:44:05 It was, I believe it was $11 billion on 10,000 affordable units coming out to $1.1 million.
0:44:06 Or yeah, maybe it’s $10,000.
0:44:11 So yeah, it was coming out to $1.1 million per affordable housing unit funded by the city.
0:44:15 We can’t be spending $1.1 million on affordable housing unit.
0:44:17 And the answer is not, we should tax rich people more.
0:44:22 Maybe we should, but everybody who’s getting taxed there deserves a better return on their
0:44:24 dollar than $1.1 million for this.
0:44:25 So yeah, tax rich people more.
0:44:27 Oligarchy is a big problem.
0:44:29 I’m very worried about oligarchy of attention.
0:44:33 We have most of the world’s attention being dominated on various social media platforms,
0:44:37 but like five guys who are all lined up next to each other at Donald Trump’s inauguration.
0:44:40 I’ve seen a bunch of people be like, well, what about political power?
0:44:41 Yeah, political power is a big problem.
0:44:45 But one way you get political power is you convince people you’re using their money well.
0:44:50 And to do that, you have to accept and admit that you’ve been using it badly and tell people
0:44:53 you got a plan to do it better in the future, or they don’t trust you.
0:44:55 And in a lot of cases, they don’t trust us now.
0:44:56 And they have a good reason for that.
0:45:01 I don’t want to spend too much time harping on the poor mayor of Chicago, whose approval
0:45:03 rating at this point is way below the Mendoza line.
0:45:09 But I think it’s really important to distinguish that form of liberalism from the kind of liberalism
0:45:10 we’re advancing in this book.
0:45:15 There’s a kind of checkbook liberalism that associates success with how much money you can
0:45:15 spend.
0:45:20 That’s a liberalism that brags about $11 billion spent on 10,000 affordable units.
0:45:24 There’s another kind of liberalism that brags not about how much you spend, but about how
0:45:25 much you build.
0:45:31 And that’s the kind of liberalism that would say, look how easy it was for us to build 10,000
0:45:32 affordable units.
0:45:33 Forget the price tag.
0:45:35 Look how quickly we did it.
0:45:37 And look at the people who are now living there.
0:45:43 That’s an outcome-based liberalism that I think is very different from the kind of progressivism
0:45:46 that has become a habit on the left in the last few years.
0:45:49 Yeah, look how awesome are high-speed rails in California.
0:45:50 Don’t you want that, Texas?
0:45:51 Yeah.
0:45:57 Well, even just, you know, manufactured homes cost 30 to 50 percent less that are dropped
0:45:59 on a piece of land as opposed to building on site.
0:46:03 I think at some point in this longer conversation, we’ve got to talk about unions.
0:46:08 If we’re going to talk about inefficiency, but while I have you here, I would be remiss not
0:46:11 to ask you guys to find, because I think you’ve done, both have done really good podcasts on
0:46:12 this.
0:46:17 It strikes me, and this is a bit of a softball amongst three progressives, that the exact
0:46:23 opposite, the antichrist to an abundance culture are tariffs.
0:46:31 Can you give me any sense for the rationale or any color you want to add on the current obsession
0:46:34 with tariffs across the current administration?
0:46:35 Derek, I’ll let you go first.
0:46:38 I think Donald Trump is a scarcity candidate.
0:46:44 I think his political success was created by a sense of scarcity, a sense that America wasn’t
0:46:48 growing fast enough, a sense that people couldn’t afford what they wanted to afford, whether it
0:46:50 was groceries or housing.
0:46:54 What we’ve seen the first few weeks of the Donald Trump administration is that he’s using
0:46:58 America’s existing shortages to demand more deprivations.
0:47:04 He’s saying Americans don’t have enough housing, and therefore we need fewer immigrants.
0:47:10 America doesn’t have enough manufacturing, and therefore we need higher tariffs, which are
0:47:11 essentially a tax on imports.
0:47:12 Right.
0:47:17 America doesn’t have enough science that we think answers the kind of questions that we want,
0:47:20 and therefore we’re going to gut scientific institutions entirely.
0:47:26 I think that’s an approach to politics that essentially says we solve our problems of scarcity
0:47:27 with just more scarcity.
0:47:29 And we’re asking for the exact opposite.
0:47:30 We’re asking for abundance.
0:47:35 We’re saying, yes, there is an affordable housing crisis in this country, and especially
0:47:37 in the cities that people want to live.
0:47:40 Let’s get out of our way and solve this problem with supply.
0:47:46 Yes, we agree with Secretary of Treasury Besson’s plan to increase total American energy production.
0:47:52 Let’s not hamper our ability to build solar, wind, and geothermal, which are certainly the
0:47:54 energy technologies of the future.
0:47:56 Let’s get out of our way and make it easier to build those things as well.
0:48:02 And so I think tariffs are just a perfect, just quintessential example of the way that Donald
0:48:06 Trump looks at the problems of American society today, looks at the shortages and the scarcities
0:48:10 and deprivations that we have, and layers more scarcity on top of it.
0:48:11 That’s his instinct.
0:48:17 And in a way, maybe I’m even giving him and his political habits even too much credit by
0:48:19 assigning them any kind of ideological character.
0:48:22 I do think that personality explains everything that Donald Trump wants to do.
0:48:26 He’s someone who likes to make big pronouncements, make people feel like they’re less than,
0:48:28 get on the phone, work out a deal.
0:48:33 And so he likes a world where he threatens tariffs against the entire world and takes phone call
0:48:37 after phone call after phone call from individual world leaders to work out little deals between
0:48:41 him and that leader to get something for himself and the people who support him.
0:48:48 This is not, in any capacity, a strategy to make more for Americans who want more.
0:48:51 This is not a strategy that’s going to do anything for housing, certainly.
0:48:54 I mean, the National Association of Homebuilders, I don’t know if you saw this when you were putting
0:48:55 together your newsletter.
0:48:59 The National Association of Homebuilders came out with a message after the tariff announcement
0:49:01 that said, this is going to be a catastrophe.
0:49:06 Our inputs include lumber from Canada and drywall material from Mexico.
0:49:10 And now we’re going to increase the taxes on those inputs by 25 percent.
0:49:15 This is a president who understood his mandate, which was all about unaffordability in this
0:49:19 country, to immediately raise the two key inputs of housing by 25 percent.
0:49:21 It’s complete effing madness.
0:49:29 Thinking about solving your problems by expanding supply is so much more rational than whatever
0:49:31 nonsense we’re getting from the government right now.
0:49:35 Can I read y’all J.D. Vance’s tweet that I’ve been really looking for an opportunity
0:49:37 to tee off on, but now maybe I have it?
0:49:39 J.D. Vance tweets.
0:49:40 This was yesterday.
0:49:42 We’re speaking on March 11th.
0:49:45 President Trump’s economic policies are simple.
0:49:49 If you invest in and create jobs in America, you’ll be rewarded.
0:49:51 We’ll lower regulations and reduce taxes.
0:49:56 But if you build outside of the United States, you’re on your own.
0:50:08 Okay, so this toy model of the economy they have is such lunacy.
0:50:16 What if you’re a restaurant and you’ve built your restaurant in the United States and you
0:50:24 employ people locally to cook your food and serve your customers and clean your dishes?
0:50:32 But like most restaurants, some percentage of the fruit and produce that you use is imported
0:50:33 from Mexico.
0:50:40 So here you are investing locally, creating American jobs, and you are not having your
0:50:42 taxes cut and your regulations cut.
0:50:47 You just had a large tax put on one of your main inputs, which is food.
0:50:50 What if I happen to just like, you know, be in the kind of waiting room place?
0:50:54 And I don’t know why I opened up Wine Spectator, because I don’t actually like wine.
0:51:01 But it had an alarmed editorial in Wine Spectator about how American wineries, their biggest
0:51:03 export market is Canada.
0:51:06 And so here are these wineries.
0:51:07 They are growing their grapes in America.
0:51:11 They employ people in America to pick their grapes and make their wine and bottle their
0:51:12 wine and et cetera.
0:51:17 But because they want to sell to Canadians and Donald Trump is starting a trade war with
0:51:20 Canada, they are getting a big price and being made less competitive.
0:51:21 What if you’re a machine?
0:51:29 What if you’re a—you make advanced machinery and a bunch of the input materials and intermediate
0:51:34 materials you need are sourced in from Europe or from Japan, but you do the assembly of making
0:51:36 this highly value-added product here?
0:51:37 Like, are they helping you out?
0:51:38 No, they’re not.
0:51:42 Because one—like, at the core of their politics is suspicion of the rest of the world.
0:51:44 It is suspicion of immigrants.
0:51:46 It is suspicion of other nations.
0:51:50 It is suspicion that trade can ever be positive sum.
0:51:53 That cooperation is something we should actually do.
0:51:57 That you are made stronger by having beneficial interactions with each other.
0:52:01 In the way that Derek said a minute ago that a lot with Donald Trump comes down to personality,
0:52:05 there are people like J.D. Vance around him trying to theory wash his intuitions.
0:52:10 But what Trump fundamentally doesn’t understand is as much interpersonal as it is economic.
0:52:13 He’s not a person who believes in cooperation.
0:52:14 He’s a person who believes in dominance.
0:52:18 And he wants to run everything that way, too.
0:52:21 And so he wants to dominate these other countries and close our border.
0:52:29 Because at the absolute guttural level, he thinks you’re either winning or losing in every single interaction.
0:52:33 And that is not the way the economy works.
0:52:37 This is not the year 1210 A.D.
0:52:39 Like, this is 2025.
0:52:42 We have a complex global economy.
0:52:50 And we are on the forefront of it, racing ahead of Europe in productivity, watching China fall behind where we thought they would be five years ago.
0:52:58 Because we’ve been – we’ve had plenty of failures along the way and plenty of people we didn’t help out and plenty of things we didn’t protect or invest enough in.
0:53:12 But their tariffs, their immigration policy, and their whole general attitude and mental architecture that informs what they do doesn’t actually make sense even when they try to explain it.
0:53:15 Which is why I was doing a podcast on tariffs the other day.
0:53:16 It was the day after Donald Trump’s big speech.
0:53:24 During the podcast, they kept exempting things from their tariff policy while I was trying to explain their tariff policy.
0:53:29 Trump was at the speech the night before saying he had talked to the heads of the big three automakers, and they were all thrilled.
0:53:34 And I’m literally talking about this in the podcast, and my producer’s like, oh, they just exempted auto goods.
0:53:42 And then later in the show, I’m talking about, wasn’t it Trump who did the USMCA trade deal, the US-Mexico-Canada trade deal in his first term, said it was an amazing trade deal?
0:53:45 Now, the first thing he’s doing is tariffs on Canada and Mexico.
0:53:47 Like, what happened to his great trade deal?
0:53:50 A couple hours later, they’re at least delaying tariffs on USMCA goods.
0:53:53 They haven’t thought about this.
0:53:55 They haven’t thought about the knock-on effects.
0:53:57 They don’t have a model of the economy that makes sense.
0:54:03 Stephen Moran, the head of the CEA, his paper, which people are looking at as a holy grail of what all this actually means.
0:54:08 He talks about a narrow path in this dense 41-page paper about how maybe all this goes perfectly.
0:54:14 And his whole theory is that you work with other countries in a way that they don’t put retaliatory tariffs back on you.
0:54:18 If they do put retaliatory tariffs back on you, then his whole theory collapses.
0:54:19 It’s already happening.
0:54:20 We’re already off the narrow path.
0:54:22 They have not thought about this shit.
0:54:24 They’re just breaking things.
0:54:28 We’ll be right back.
0:55:08 Today Explained, Sean Ramos from here with Nadira Goff, staff writer at Slate.
0:55:10 Nadira, Disney’s got a new movie coming out this week.
0:55:12 Is everyone enchanted?
0:55:13 No.
0:55:20 I think that there is a lot of confusion and a lot of controversy around Snow White.
0:55:22 Magic mirror on the wall.
0:55:25 Who is the fairest of them all?
0:55:29 But yeah, it’s safe to say that not everyone is enchanted.
0:55:31 This was my father’s kingdom.
0:55:33 A place of fairness.
0:55:37 But the queen changed everything.
0:55:42 Now I have to ask, as a student of the Brothers Grimm, how many controversies are there?
0:55:44 Well, you’re in luck.
0:55:49 You’re so lucky today is your lucky day because there happens to be about seven.
0:55:50 Oh my goodness.
0:55:54 It’s a human.
0:55:55 What did you think I was?
0:55:55 Nothing.
0:55:56 Ghost.
0:56:00 Snow White and the seven controversies on Today Explained.
0:56:01 Come have some fun with us.
0:56:02 You deserve it.
0:56:10 So we want to introduce you to another show from our network and your next favorite money podcast for ours, of course.
0:56:16 Net Worth and Chill host Vivian Tu is a former Wall Street trader turned finance expert and entrepreneur.
0:56:21 She shares common financial struggles and gives actionable tips and advice on how to make the most of your money.
0:56:28 Past guests include Nicole Yoder, a leading fertility doctor who breaks down the complex world of reproductive medicine and the financial costs of those treatments.
0:56:34 And divorce attorney Jackie Combs, who talks about love and divorce and why everyone should have a prenup.
0:56:37 Episodes of Net Worth and Chill are released every Wednesday.
0:56:41 Listen wherever you get your podcasts or watch full episodes on YouTube.
0:56:42 By the way, I absolutely love Vivian Tu.
0:56:44 I think she does a great job.
0:56:55 We’re back with more from Ezra Klein and Derek Thompson.
0:56:58 While I have you, you’re both great communicators.
0:56:59 You’re both strategists.
0:57:00 You understand positioning.
0:57:01 You understand messaging.
0:57:03 What thoughts do you have?
0:57:06 So as a progressive, I found that I was sort of flat-footed and just overwhelmed.
0:57:17 Just sort of, they’re flooding the zone with things that are meant to, I think, distract us, enrage us, male versus female, gulf of cheaper eggs, DEI causing helicopter crashes.
0:57:24 Because I don’t think they want us focused on the fact that they’re about to increase the deficit by $800 billion a year to give guys like me a tax cut.
0:57:27 That we’re surrendering to a murderous autocrat.
0:57:33 I think they’re saying, look over here because they don’t want to focus on the important things that are just sort of indefensible.
0:57:38 I’m curious what advice, and this has probably already happened, and Derek, I’ll let you go first.
0:57:43 Democratic Party calls and says, okay, we really got to figure out our messaging and our strategy here.
0:57:52 And assuming that people understand that some of these policies are probably just economically ruinous, I don’t even think it’s the tariffs are the most damaging thing.
0:57:54 I think it’s our inconsistency.
0:57:57 You want to see what he’s going to do around tariffs or economic policy.
0:57:58 Look at who I had lunch with last.
0:58:08 And you can’t have a consistent – when no country knows who they’re waking up next to, they’re remiss to do anything with you.
0:58:10 It’s like, well, he could call this off tomorrow.
0:58:14 That’s just no way to operate an economy, much less a country.
0:58:25 What advice would you have for Democrats and the DNC who say are of like mind and think, yeah, we need to take – reusurp government and constitutional authority.
0:58:26 This economic plan is disastrous.
0:58:35 What strategy – you’re in the war room with James Carvell right now advising 2026 congressional candidates and then 2028.
0:58:38 What strategies do you think we need to deploy, Derek?
0:58:40 I think we lost two games in 2024.
0:58:44 I think we lost a substantive game with affordability.
0:58:46 And I think we lost an attention game.
0:58:49 This is definitely something that Ezra can speak to.
0:58:54 I would tell Democrats, remember why we lost the 2024 election.
0:58:59 It was because a plurality of Americans said that they couldn’t afford the life that they wanted.
0:59:01 They couldn’t afford the good life.
0:59:08 And Democrats should be absolutely laser-focused on how to provide the good life for Americans.
0:59:13 And that means pointing out all of the lurid ways that Donald Trump is getting in the way.
0:59:21 I mean, raising tariffs while trying to build a manufacturing base is one of the craziest things I’ve ever heard.
0:59:30 I mean, the worst thing you can possibly do when you’re building a manufacturing base in any country is to make it impossible for domestic manufacturers to sell overseas.
0:59:41 The first thing you want to do if building an industrial base – this is what South Korea did, it’s what Taiwan did – is find a way to make it easier for your domestic companies to sell overseas.
0:59:47 Not to get every overseas buyer to hate you so much that they retaliate their tariffs up to 50%.
0:59:50 So the first thing that I would say is remember why we lost.
0:59:52 We lost because of affordability.
0:59:54 How do we focus on affordability?
0:59:57 How do we give people a set of new answers on affordability?
0:59:59 And frankly, I think our book does that.
1:00:03 It does that by shifting attention toward how do we solve these problems with supply.
1:00:09 And especially how do we solve the mother of all affordability problems, which is housing with supply.
1:00:16 In many cases, the good news here is that Donald Trump, for all of his authoritarian power, does not control housing policy in San Francisco.
1:00:19 He does not control housing policy in Boston.
1:00:21 He does not control housing policy in Los Angeles.
1:00:28 It is those cities run by those citizens and the people that they elect who control housing policy there,
1:00:32 which means that they have the ability to answer problems no matter what Donald Trump does.
1:00:34 Focus on affordability.
1:00:39 The second big mistake that I think the Democrats made in 2024 and in the previous few years,
1:00:45 is I think that we’ve become afraid of talking to people who disagree with us.
1:00:50 There’s been a kind of purity culture that has come up on the left.
1:00:52 And sometimes you could argue it came up for good reason.
1:00:59 Democrats were fighting for causes that they found incredibly worthy and they didn’t want those causes contaminated by voices that they disagreed with.
1:01:12 But as a result, I think it’s created an insular character on the left that doesn’t feel like it is extending an arm for people in the center who agree with some of what we support, but not everything that we support.
1:01:18 So I want to, from a substantive standpoint, absolutely focus like a laser on the issue of affordability.
1:01:24 Not only because it’s the number one reason why we just lost, but because I think it’s going to be the number one cause of the 2020s.
1:01:32 And then number two, I want us to have a different attitude toward reaching out to people who might disagree with us about things that even we find incredibly important.
1:01:42 I want us to be less embarrassed and less shy about talking to the center because ultimately it’s not just about building a coalition that’s 48% plus one.
1:02:00 Ultimately, what we want, I think, is to redefine what the Cambridge historian Gary Gerstle calls a political order, a set of political and economic rules that doesn’t just win two and four year elections, but actually can last for decades the same way that the New Deal order lasted for decades.
1:02:06 And to do that, you have to reach way beyond the 48% that’s automatically going to vote for you in every quadrennial election.
1:02:09 You have to reach out to the 55% and the 60%.
1:02:13 And that requires not just a different kind of substantive focus.
1:02:15 I think it requires a different theory of how to communicate.
1:02:17 I think that’s pretty damn good.
1:02:20 I’ll add very little to it.
1:02:21 Two things.
1:02:26 One is that you have to take seriously that people don’t like you.
1:02:29 You have to take seriously that the Democratic Party brand is trash.
1:02:30 I mean, just look at it in the polling.
1:02:33 It’s less popular than Donald Trump himself.
1:02:36 And Donald Trump is not a popular person or candidate.
1:02:42 So one thing you’re going to have to do is deal with the fact that you’ve lost people’s faith.
1:02:47 And the only way to gain it back is to show in some way or another that you’ve changed, in some way or another that you’ve rethought something.
1:03:05 And that gets to the second, which is that the Democratic Party has become, over time, too internally coalitional, too afraid of giving offense, too afraid of disappointing any members of its coalition, its interest groups.
1:03:10 Donald Trump, if he’s proven anything, it’s that you can reshape what a party is about.
1:03:12 Now, he’s done it autocratically.
1:03:28 But over time, Donald Trump has substantially changed what the Republican Party is on trade, on immigration, on Russia, on Ukraine, on national security, on whether it is important for your leaders to lead a decent Christian life.
1:03:42 Or whether you want, like, the god of the pagans, Elon Musk, with his, as somebody put it, 13-ish children, to be your standard bearer, alongside Donald Trump with his, you know, three marriages, et cetera, and endless sexual harassment cases, lawsuits, reports.
1:03:45 So you can change what you are.
1:03:56 When what you are currently, in the case of the Democratic Party, is a party that says it’s of the working class and is losing working class voters, whether now defined by income or education, then you have to change, right?
1:03:57 Or you are not the thing you think you are.
1:04:00 And I think Democrats need to change.
1:04:09 And that means, in public, saying how the next generation of them is going to be different, and what they have rethought, and what they are not going to do the same next time as this time.
1:04:11 You are going to need resistance.
1:04:16 If I was in the room with James Carville, I could not disagree with more of the James, who I have tremendous respect for.
1:04:24 The Democrats should, as he put it in The Times, play dead and wait for the Trump administration to collapse of its own weight.
1:04:25 I don’t think that works.
1:04:26 I don’t think it’s leadership.
1:04:31 But they do need, in addition to being a resistance, to be an alternative.
1:04:34 And they need to admit the places where they failed as an alternative.
1:04:40 And then the next standard bearer, the people competing to be the next standard bearer, need to show how they’ll be different.
1:04:59 Like, that shows that if you vote for us at this time, you’re getting something that you’re going to like better, or at least it’s going to be different than what you got last time.
1:05:02 There is attentional energy and controversy.
1:05:04 Democrats have been too afraid of it.
1:05:06 I want to propose a thesis.
1:05:07 I have two questions, and I’ll let you guys go.
1:05:08 I’ve been generous with your time.
1:05:14 I think that we oftentimes get focused on, we study to the wrong test.
1:05:17 And I’m trying to think, what is the goal?
1:05:18 What is the mission?
1:05:20 AI, GDP, productivity.
1:05:22 I think it’s all it means to the ends.
1:05:28 But the ends are creating an operating system, a platform, an economy that enables people to have deep and meaningful relationships.
1:05:32 And the three of us, I believe, all have partners and are raising children.
1:05:40 And much to my surprise, I have found that that has given me purpose and a sense of being and a sense of satisfaction that I didn’t anticipate.
1:05:41 I wasn’t planning to have children.
1:05:51 For me, the unifying theory of everything, it should be we reverse engineer all of our public policy and economic decisions to one thing.
1:06:06 And that is people, 18 to 40, should have the opportunities to meet each other, mandatory national service, more freshman classes, more third places, quite frankly, more alcohol, such that they can tax remote works.
1:06:20 One in three relationships begin at work, such that we have more people, quite frankly, having more sex, falling in love, and then have the economic wherewithal to have children.
1:06:33 Universal child tax credit, pre-K, minimum wage of $25 an hour, quite frankly, just stuff more money in their pockets, such that we go back to where we were 40 years ago, where 60% of 30-year-olds have a kid versus 27% now.
1:06:35 I don’t think it’s because people don’t like kids.
1:06:36 I think it’s because they can’t afford them.
1:06:48 But the unifying theory of everything is that any able-bodied American should at least have a reasonable chance that they will have the opportunity to meet somebody and the economic viability to have a family.
1:06:59 And that everything should be reverse-engineered towards that opportunity for young people, that that’s the unifying theory of everything and should drive all of our economic and social policies.
1:07:00 Your thoughts?
1:07:15 I wrote a cover story for The Atlantic called The Anti-Social Century, where I said that maybe the most important social problem facing this country is that Americans spend a record amount of time alone and a record low amount of time in physical face-to-face contact.
1:07:22 And as I’ve continued to report out this story, one of the more interesting parts of it actually relates incredibly deeply to housing.
1:07:37 If you take a look at sort of the life cycle of American aloneness, teens have fewer friends, teens hang out with their friends less, 20-somethings date less, and then 30-somethings are less likely to get married, 40-somethings less likely now to have children.
1:07:47 There’s a kind of life cycle effect of this drawing back from interpersonal relationships, which, Scott, I’m hearing you say is absolutely core to your vision of the good life.
1:08:00 I personally don’t think that it is a political agenda’s job to define and inscribe the good life explicitly into people’s lives.
1:08:09 I think it’s the job of a political agenda to build a platform, a stage, upon which people can make free choices that make them happy.
1:08:17 And the most important part of that platform and stage that I think many young people today are missing is affordable housing.
1:08:26 If you look at the share of young people who still live with their parents in their 20s and even early 30s, it’s higher than it’s ever been outside of a recession.
1:08:35 It’s very, very hard to go on a successful date and get married when you’re still living with your parents in your 20s and 30s.
1:08:44 And the reason that people are living with their parents in their 20s and 30s is not because they don’t have the courage that people in the 1980s have or don’t have the gumption that people in the 1990s have.
1:08:51 It’s they don’t have the money that they need often to afford a place of their own in the cities where they want to live.
1:09:01 And a part of abundance, I think that every great political movement has in America been a kind of redefinition of freedom.
1:09:02 Right.
1:09:07 The New Deal order was about defining the four freedoms of speech and belief from want, from fear.
1:09:20 And in the 1980s, Ronald Reagan created a new political order in this country that some call neoliberalism, which redefined freedom, not freedom of, but freedom from freedom from government.
1:09:24 In a way, I think abundance is another redefinition of freedom.
1:09:36 And at the heart of that freedom is the freedom to live where you want to live, because we have a rational housing market in this country that makes it affordable to have a place of your own in the place you want to live.
1:09:57 And I think if we had that, I think if we had a reasonable supply focused housing policy in this country, you would have more young people not living with their parents, living alone, starting what some call adulthood a little bit earlier, having the confidence that their money goes further so they can afford better dates with whoever they want to date.
1:10:05 And therefore becoming more likely to get married, to get married and have kids, because as we know, fertility rates tend to very commonly track coupling rates.
1:10:09 If you want a country with more kids, you need to make it easier for young people to couple.
1:10:14 I think absolutely core to that is making it easier for people to live where they want to live.
1:10:16 And that fundamentally is a housing story.
1:10:23 So the answer to your question is that it leads, as so many things lead in our book and in American Life Today, it leads to housing.
1:10:27 I’d like to do a whole podcast with the two of you on this.
1:10:30 I definitely agree with Derek that the answer to your question is that people should buy our book.
1:10:31 Like, that is clear.
1:10:37 I think beyond that, I’m probably more pessimistic than both of you are.
1:10:39 So I’m a left natalist.
1:10:43 The lead up here that you offered is mine, too.
1:10:44 I think that family is important.
1:10:46 I think children are important.
1:10:48 I am worried about falling fertility rates.
1:10:53 And I’m worried about them because of what it means about human flourishing, not just what it means about societies replacing themselves.
1:10:55 I’ve done a bunch of podcasts on this.
1:10:56 I’ve done a bunch of reporting on this.
1:11:01 I really recommend the new Gideon Lewis Krauss piece on South Korea in The New Yorker from a couple weeks ago.
1:11:08 But look, you can have the most, from the liberal perspective, pro-natal policy you can possibly imagine, right?
1:11:09 That’s Sweden, Denmark.
1:11:11 Their fertility rate has collapsed, too.
1:11:20 All their great parental leave and paid family leave and, you know, universal pre-K and, you know, egalitarian tax system.
1:11:21 It didn’t do it.
1:11:22 They’re down at 1.1.
1:11:35 I don’t know that we know, at least outside of policy interventions of a scale that nobody really wants to think about, what we could do that would dramatically change that.
1:11:43 I think it’s much, it’s cultural, it’s also technological in terms of, you know, birth control and fertility windows and all the rest of it.
1:11:45 I’m not sure we know how to do it.
1:11:48 I do agree, though, that we could make the whole thing a hell of a lot easier.
1:11:53 I do agree that housing is a big part of that and economics are a big part of that.
1:11:56 And also, I agree that culture is a big part of that.
1:12:16 And I think it matters that, I think you see in J.D. Vance with his scolding of childless cat ladies, I sort of have this thing that comes from something the sort of conservative British feminist Louise Perry said in a Barry Weiss interview, where she has this point that the difference between Andrew Tate and Jordan Peterson is that Tate is a pagan and Peterson is a Christian, which I thought was interesting.
1:12:24 And it made me think about how you could cut the Trump administration the same way, like Elon Musk is a pagan, J.D. Vance is a Christian, that kind of thing.
1:12:29 But J.D. Vance’s scolding of people was an effort to change culture, right?
1:12:32 I think that’s why he was doing it and also because he’s become very resentful.
1:12:38 I think the left has given up on having even any way to talk about what family structures it believes in.
1:12:42 I don’t think you’re going to be able to go back to the 50s the way some of these people think you will.
1:12:44 That includes people like Perry.
1:12:47 I think you have to imagine things that are new thing.
1:12:50 I think that housing actually be a part of it, but also in terms of experimenting more.
1:12:53 Like I know a lot of people want to raise kids in co-living situations.
1:13:00 It’s extremely hard to figure out how you can co-locate with your six best friends, you know, who are coupled and all raise your kids together.
1:13:01 I don’t think it should be that hard.
1:13:03 I think we should make that a lot easier to experiment with.
1:13:12 Like the thing where we’re raising all these kids in two working parent families or often one single parent family, that’s a huge experiment in human history.
1:13:14 That is not how we did it.
1:13:19 So making things that are a little bit more clan-based, a little bit more communal possible again.
1:13:23 But you can’t do it if 70 percent of the housing land in this country is owned for single family.
1:13:26 So I think you don’t just need to make new things possible.
1:13:29 I think you need to make experimentation possible.
1:13:35 And I think culturally, I do think the left needs to figure out how to not just be so individualistic about this.
1:13:44 I hear so many people talk about, and they ask me about in my AMAs and stuff, having kids, like it’s, you know, just a cost-benefit analysis like taking a trip to Costa Rica.
1:13:47 I think there’s something more valuable about that.
1:13:48 And it’s not just about your life.
1:13:55 It is also about the degree to which we should cherish the existence and the gift of existence others get to have, right?
1:13:58 The question of me having kids is not are my weekends better or worse.
1:14:02 Their experience of the weekend is important, in many ways more important than mine.
1:14:20 And so I do think there’s cultural dimensions to this, too, that are not easily amenable to policy, but do require a kind of set of discussions and a sense of what is the good life, particularly in a fairly secular age, that, you know, liberals are pretty uncomfortable having.
1:14:26 I’m not sure abundance of the book solves all of that, but it definitely solves enough of it that you should go check it out.
1:14:31 Ezra Klein is a New York Times columnist and the host of The Ezra Klein Show podcast.
1:14:35 Previously, he was the founder, editor-in-chief, and then editor-at-large of Vox.
1:14:40 Derek Thompson is a staff writer at The Atlantic and the author of the Work in Progress newsletter.
1:14:47 He’s also the author of the books Hitmakers and On Work, Money Meaning Identity, and the host of the podcast, Plain English.
1:14:49 Their new book, Abundance, is out now.
1:14:50 I said this off mic.
1:14:52 I just admire you guys so much.
1:14:53 I think you’re fearless.
1:14:54 I think you’re great storytellers.
1:14:56 Just keep on keeping on, gentlemen.
1:14:56 Well done.
1:14:58 Thank you, man.
1:14:58 I appreciate it.
1:14:59 Scott, thanks so much.
1:15:17 Algebra of happiness.
1:15:25 A lot of young people, more young people than ever as a proportion of the population are struggling with anxiety.
1:15:32 And I did a podcast yesterday with Anthony Scaramucci and Dan Harris from 10% Happier.
1:15:42 And Dan has really been, you know, the term is brave, but very useful in helping other people discuss and address their anxiety.
1:15:43 He struggles with panic attacks.
1:15:50 And he talks a lot about different cognitive behavioral therapy to help them manage through that anxiety.
1:15:55 And he has this statement that I just love, and that is, action absorbs anxiety.
1:15:58 And I’m going to share a story that is not a Hallmark story, but I think it’s relevant.
1:16:00 I coach young men.
1:16:08 And one young man in junior college, about early 20s, we’re just sort of talking.
1:16:09 And I could kind of tell what’s on his mind.
1:16:10 I’m like, what’s on your mind?
1:16:10 I said, everything’s fine.
1:16:11 He’s like, yeah.
1:16:13 He’s like, I’m a little bit freaked out right now.
1:16:14 And I said, what’s up?
1:16:16 And he said, I’ve been having trouble peeing.
1:16:17 I’m like, what do you mean by that?
1:16:18 I have trouble peeing.
1:16:20 But it’s because I have a huge prostate.
1:16:23 He goes, no, it’s been feeling funny and weird down there.
1:16:26 And I’m worried I have an STD.
1:16:28 And I said, well, have you had unprotected sex recently?
1:16:30 And he said, yes, I have.
1:16:36 And I said, look, I know exactly how to do this.
1:16:38 I know exactly what you need to do right now.
1:16:45 Right now, you need to go to urgent care, or there are all sorts of STD clinics in your
1:16:48 city, lives in a city, and you need to get tested right away.
1:16:52 And on the way to the doctor, you’re going to start to feel better, because you’re taking
1:16:53 action.
1:16:57 And fortunately, we live in a society right now where the vast majority, if not all of
1:17:00 STDs, can even can be handled or addressed.
1:17:06 And as soon as you start taking action against this problem or this issue, you’re going to
1:17:06 feel better.
1:17:08 Action absorbs anxiety.
1:17:14 And at the end of life, you’re not going to regret what happened to you.
1:17:17 You’re going to regret being so stressed out about it.
1:17:22 That is, if you’re worried about anything with your health, you immediately go to the
1:17:23 fucking doctor.
1:17:27 And maybe that’s a point of privilege for me, because I have the money.
1:17:33 But if you have resources, if you’re insured, if you can go to urgent care, you want to address
1:17:34 this situation.
1:17:36 Whenever your health is bothering you, immediately.
1:17:39 The moment you make the appointment, you start feeling better.
1:17:40 I am addressing it.
1:17:43 Action absorbs anxiety.
1:17:45 You want to move against this.
1:17:46 This is really upsetting me.
1:17:46 This is bothering me.
1:17:48 How am I going to solve it?
1:17:49 Fuck, I can’t get an internship.
1:17:51 I can’t get a job.
1:17:52 Well, okay.
1:17:54 What do you need to do to get a job?
1:17:55 You need to send out resumes.
1:17:57 You need to put together a resume.
1:18:02 When you start putting together your resume, that action starts absorbing your anxiety.
1:18:03 It’s very simple.
1:18:04 Get out of your head.
1:18:05 Get out of your head.
1:18:09 At the end of your life, you’re not going to be upset about an STD scare, not being able
1:18:12 to get a job or a health scare.
1:18:16 The thing you’re going to be worried about or the thing you’re going to regret is how
1:18:17 anxious you were about it.
1:18:18 And here’s what you do.
1:18:20 You move to action.
1:18:22 Action absorbs anxiety.
1:18:28 This episode was produced by Jennifer Sanchez.
1:18:29 Our intern is Dan Shallon.
1:18:31 Drew Burrows is our technical director.
1:18:34 Thank you for listening to the Prop G Pod from the Box Media Podcast Network.
1:18:39 We will catch you on Saturday for No Mercy, No Malice, as read by George Hahn.
1:18:45 And please follow our Prop G Markets pod wherever you get your pods for new episodes every Monday
1:18:46 and Thursday.
1:18:57 I’m sorry, the tea’s just better here.
1:18:58 The tea’s just better.
1:19:01 It’s like porn for me is better after an edible.
1:19:02 The tea’s just better.
1:19:03 Wrong analogy.
1:19:04 Wrong analogy.
1:19:35 Thank you.

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0:01:52 Welcome to Office Hours with PropG.
0:01:57 This is the part of the show where we answer questions about business, big tech, entrepreneurship, and whatever else is on your mind.
0:02:01 Today, we’ve got two great listener questions lined up.
0:02:03 And then after the break, we’re introducing something new.
0:02:05 The Reddit hotline.
0:02:06 Oh, my God.
0:02:08 It’s not the red phone.
0:02:09 It’s not the bad phone.
0:02:13 It’s the Reddit hotline where we pull questions straight from Reddit.
0:02:20 If you’d like to submit a question for next time, you can send a voice recording to officehoursofproftgymedia.com.
0:02:21 Again, that’s officehoursofproftgymedia.com.
0:02:27 Or if you prefer to ask on Reddit, post your question on the Scott Galloway subreddit.
0:02:28 That’s scary.
0:02:30 What shit must be flying around on that thing?
0:02:34 And we just might feature it in our next episode.
0:02:35 By the way, just a little bit of insight.
0:02:37 Let’s bring this back to me.
0:02:49 So we did in South by Southwest, we did a party, or Vox did a party, which is basically where they feature all their quote-unquote talent or lack thereof, their podcasters, to try and get advertisers to advertise more on our podcasts.
0:02:52 And they let out some information.
0:03:01 Basically, Vox, like every other organization, holds onto information like nuclear codes because an asymmetry of information creates advantage for the people who have the information.
0:03:11 But they did let out the following, that one of our fastest-growing segments of anything I do across this entire – let’s be honest, I’m a total podcast whore.
0:03:13 I’m like, hey, stranger, what’s your name?
0:03:13 Another podcast?
0:03:14 Sure, why not?
0:03:19 But the pod that’s doing or going the fastest is actually Office Hours.
0:03:29 And Office Hours, the vision for Office Hours was when my mom and I – I moved in with my mom for about eight months when she was very sick.
0:03:38 And one of the things we used to do was we would watch her favorite show, Frasier, and I based Office Hours on the Colin show on Frasier.
0:03:40 Anyways, welcome.
0:03:42 Hi, this is Dr. Crane, and I’m listening.
0:03:43 First question.
0:03:47 Hey, baby, I’m here to lose a call in.
0:03:48 Hi, Prof G.
0:03:50 This is Brian from New Jersey.
0:03:59 And I want to say thanks for doing such a great job offering an analysis on a wide range of topics and your genuine concern for people despite party politics.
0:04:04 I’m involved with a small, successful school adjacent to New York City that exists solely on tuition.
0:04:08 Last week, I heard you talking with Jess Tarlov about school choice.
0:04:15 But the reality is not everyone who sends their children to a private school are doing so from a place of excess.
0:04:21 The public schools in our area are overcrowded, and parents have little to no say about what their children are learning or experiencing.
0:04:34 Do you see any value, even if it was a means-tested program, for some sort of voucher or tax incentive, to take children from the public school and support smaller schools that run more efficiently?
0:04:39 From my very slanted perspective, for a third of the money of public schools, we’re doing a better job.
0:04:50 And at the same time, if the public schools were getting two-thirds of the money not to have a child in the classroom, they could devote more resources to the children who are there.
0:04:53 Thanks for listening, and I really look forward to your answer.
0:05:00 So let me be clear, and I want to acknowledge up front, there’s no such thing as a perfect solution where everybody wins.
0:05:10 I think you make a solid argument for why there are instances where vouchers probably help good people afford programs, maybe put some competition on the public schools.
0:05:12 When I look at – so the U.S. is strange.
0:05:18 Our K-12 is some of the worst in the modern or G7 economy, but our universities are some of the best.
0:05:22 And our education or our economy is beating everybody.
0:05:27 So a lot of people would just do the analysis and say, well, shitty K-12, that’s sort of the hunger games.
0:05:33 You have rich parents or you’re excellent and somehow you find a way to a good college, seems to be working for the U.S. economy.
0:05:51 The problem is I think it results in a lot of obesity, anxiety, young people without the skills to thrive in this economy that don’t have a lot of economic power and probably, I don’t want to say get exploited, but leverage for minimum wage that should be $23 an hour, not $7.25 based on productivity or just inflation.
0:06:15 So I feel as if the public school system is yet another example of not a direct conspiracy but the accidental conspiracy of creating the bottom 90 percent who become very cheap inputs for shareholders of bigger companies that know how to manage the information economy and end up, quite frankly, just being exploited and paying a lot of money for shitty sugary food and then becoming obese and then being handed over to the diabetes industrial complex.
0:06:32 Part of that system, though, is I think that when I look at healthy societies where there’s low childhood obesity, they have a private school option, but essentially there’s just much more focus on the resources and measurements for good public schools.
0:06:38 On average, American public school teachers make roughly $70,000 annually while their private counterparts make about $50,000.
0:06:39 So you’re absolutely right.
0:06:55 It appears that, on average, public schools are paying people 40 percent more because, quite frankly, you end up with probably a more difficult situation with a lot of low-income kids that probably bring a lot of anger, maybe a single-parent home where the parents can’t be involved in the kid’s life.
0:07:04 Whatever the excuse is, but public school teachers, the market is saying we need to pay them more, and private schools don’t have to pay as much.
0:07:10 Despite this, private school students consistently score better on assessments in almost every subject.
0:07:14 In some, teachers’ increased wages don’t necessarily correlate with better outcomes.
0:07:14 Why?
0:07:19 Because the public school system is riddled with bureaucracy, quite frankly.
0:07:21 And I think this kind of buttresses your point.
0:07:26 In America, there are four times as many administrators in the public education system than there were in the 1950s.
0:07:35 In 2015, the New York State School Board Association found that firing an incompetent teacher takes an average of 830 days and costs $313,000.
0:07:36 The good news?
0:07:43 School choice bills or laws that allow states to award vouchers to the parents of students in non-public schools are on the rise.
0:07:45 This is true even across party lines.
0:07:53 The 2024 poll of registered voters found that 83% of Republicans, 69% of independents, and 70% of Democrats say they strongly or somewhat support school choice.
0:08:07 I am really torn on this because what I have seen is the net effect of school choice or vouchers just subsidizes wealthy people who are going to send their kids to public or to private schools anyways.
0:08:17 And this is Pulse Marketing, but my kids were at this lovely private school in Gulfstream, Florida called Gulfstream that costs 18 or 20 grand.
0:08:30 And the idea that we were going to give people in the local community would get $10,000 towards a school, I think all that would have done was of the 230 families, 200 of them would have just got a $2 million tax break.
0:08:37 And taking money away from Atlantic, the high school, which is actually a pretty good high school, that they desperately need.
0:08:44 Now, are there probably middle-class families that would be able to attend a better school because of that $10,000 voucher?
0:08:45 Yes.
0:08:50 Is it good to have competition put on public schools?
0:08:50 Yes.
0:08:53 When we’re talking about education, though, I mean, it gets so complicated so fast.
0:08:56 So the Department of Education is supposedly on the chopping block.
0:09:04 And I’m not one of these people that doesn’t think the Department of Education should, you know, is this, it used to be sort of this virtue signaling, everyone rallied around it.
0:09:06 I think it should probably be much smaller.
0:09:08 It’s good at Pell Grants.
0:09:10 It’s good at figuring out student loans.
0:09:16 It’s probably done a lot of harm in terms of universal and mandatory testing, where every teacher now studies to the test.
0:09:18 It’s created a lot of unnecessary stress in our public schools.
0:09:20 Parents hate it.
0:09:21 Principals hate it.
0:09:21 Teachers hate it.
0:09:22 Students hate it.
0:09:27 And I feel as if they, again, are trying to justify their own bureaucracy.
0:09:40 So this is a long-winded way of saying I see your point, but one, I’m on board with a dramatic decrease in the amount of bureaucracy through competition with public schools.
0:09:44 I believe that teachers and principals should be fired and schools should be shut down if they’re not performing.
0:09:46 And new ones should be propped up.
0:09:56 But I think we’ve got to figure out a way to get more parents involved in public schools because the number one signal of whether a school is successful isn’t even resources.
0:09:58 It’s parental involvement.
0:10:07 So trying to make public schools more attractive and the way you do that, I think, is with a lack of bureaucracy.
0:10:10 And also, I just think it’s going to take more resources.
0:10:24 And I don’t think that skimming the most blessed families and the most involved parents off of the top and pulling them out of the public school system, I just think we’re further cementing a have-and-have-not caste system.
0:10:30 Having said that, I think most of it should be left to the states and local governments trying to figure it out.
0:10:38 One of the biggest problems we have in our society is that local schools are based on property tax revenues, so the wealthy neighborhoods have some private schools.
0:10:47 The public school in Palo Alto and in Woodside is better than most private schools nationally because they have a lot of money from property taxes.
0:10:49 So there has to be a leveling up.
0:10:52 The problem is the leveling up isn’t just about resources.
0:10:56 It’s about keeping dual parent households involved in the schools.
0:10:59 This is a difficult, tough question.
0:11:00 More competition.
0:11:06 More holding the teachers’ unions and public schools accountable, not being afraid to shut them down.
0:11:08 Having a reasonable ratio of administrators.
0:11:13 Clearing out the bureaucracy such that you can fire teachers and bureaucrats.
0:11:19 But also, I’m just not down with taking more money for vouchers for the privatization of our education system.
0:11:30 I think, in general, you’ve had an oligarchy that is trying to insert a profit motive into every single public service, which ultimately just creates scale, a better service, and then they start raising the rents on everybody.
0:11:32 Appreciate the question.
0:11:34 Question number two.
0:11:36 Hey, Scott.
0:11:37 Big fan of the podcast.
0:11:40 I’m a young man looking to start investing.
0:11:43 And I want to hear more about your view on the Reddit stock.
0:11:45 I know I listened to the podcast on Monday.
0:11:47 You said you were bullish on this stock.
0:11:50 I tend to agree with you through my own research.
0:11:57 Would love to hear more about your outlook on Reddit and what you see for the next five, ten years with this stock.
0:12:00 Thanks, Anonymous from Unknown.
0:12:02 Really appreciate the question.
0:12:06 So, my IPO recommendation of 2024 was Reddit.
0:12:08 And it was a simple analysis.
0:12:17 I looked at the ten most traffic sites in America, and all of them, except Wikipedia, nonprofit, traded for – were worth between $600 billion and $3 trillion.
0:12:24 And Reddit, at that time, was toggling, based on the metric you looked at, somewhere between the third and the fifth most traffic site in America.
0:12:27 And it was going public in a market cap of $5 billion.
0:12:31 Because, to that point, they had not done a great job of monetizing that incredible attention.
0:12:35 However, I believe, over time, you can monetize attention.
0:12:43 It just – I remember looking at these charts 20 years ago, where newspapers were 10% of attention but 30% of advertising.
0:12:46 And the internet was 50% of attention but only 15% of advertising.
0:12:48 I remember, okay, this is pretty easy.
0:12:54 Find the internet companies that are commanding attention, and eventually, these things are going to calibrate and equalize.
0:12:56 And I saw the same thing here.
0:13:07 And the stock went out at – was priced, I think, at $35 or $38, shot to $60, and then went as high as $240, and has now – has been cut in half with a drawdown.
0:13:15 So, as we’re recording this, their stock has been cut in half in the past month after Q4 earnings that reported underwhelming user growth.
0:13:16 But that’s still up.
0:13:21 I think that still means it’s tripled or quadrupled since its IPO.
0:13:30 Global Daily Active Unique users rose 39% year-on-year to an average of $102 million, just missing analyst expectations of $103 million.
0:13:31 Why did it get hit so hard?
0:13:36 The new meeting expectations in the internet economy is blowing them away.
0:13:37 That’s the expectation.
0:13:39 The expectation is that you’re going to blow away our expectations.
0:13:52 Although Reddit was now or is now the sixth most visited website in the world, it’s worth 50 to 60 times less than other sites that command that same attention, including Google, YouTube, Facebook, and Instagram.
0:13:54 So, what do I think?
0:13:58 I think this company is still a good long-term hold.
0:14:07 It’s got a market cap now of $22 billion, which for a guy like me, one of my many flaws as investors, I anchor off the cheapest it’s ever been.
0:14:10 Yeah, it went public at a valuation of $5 billion.
0:14:13 It traded to $7 or $8 billion that day, and now it’s at $21, but it peaked at $40.
0:14:14 It’s come down.
0:14:16 I think Reddit is a good long-term hold.
0:14:24 I just think, again, if you buy into this notion that eventually monetization catches up with the tension, it’s going to – I think it’s a good long-term hold.
0:14:27 Having said that, my general advice is the following.
0:14:32 Low-cost index funds, because nobody can pick stocks over the long term and outperform the market.
0:14:44 Even Warren Buffett will tell you that they were investing in an unusual time with a lack of information, and the asymmetry of information or your ability to find alpha or stocks that were undervalued was much greater.
0:14:46 They’re the likelihood of doing that than it is now.
0:14:52 Warren Buffett, who got – who’s arguably the best investor in history, is telling people not to be stock pickers.
0:15:06 So having said that, I believe that you can take 30% or should take 30% of your money and have some fun and invest in single stocks or single asset classes where you think you have some sort of insight or you believe that they’re undervalued, and this might be that.
0:15:12 What I would also suggest, though, is that two-thirds plus of your net worth is put in low-cost index funds.
0:15:13 And here’s a bit of the wrinkle there.
0:15:17 Make sure they’re low-cost index funds that aren’t just solely focused on the U.S.
0:15:24 The U.S. stock market is now at 98% in terms of value, meaning it’s only been more expensive on a P.E. ratio, 2% of its history.
0:15:32 European value stocks are in the bottom 2%, meaning they’ve been more expensive on a P.E. basis or traded at higher levels for 98% of their history.
0:15:37 This, to me, says to me that the markets where the rivers or flows of capital are about to reverse.
0:15:44 That was one of my big predictions for 2025 is I think that non-U.S. markets are going to outperform U.S. markets.
0:15:45 Anyways, will you ask?
0:15:46 I like Reddit.
0:15:47 I think it’s a nice long-term hold.
0:15:53 But just be careful believing that me or anybody else can give you advice on single stock picking.
0:15:54 We can’t.
0:15:55 You want to have some fun?
0:15:56 You want to try and find some alpha?
0:15:57 Have at it.
0:16:06 But keep the bulk of your firepower, your dry powder, for low-cost index funds that are diversified not only across the S&P, but across different geographies globally.
0:16:07 Thanks for the question.
0:16:17 We have one quick break, and when we’re back, speaking of Reddit, we’re diving into the depths, into the bowels of Reddit.
0:16:18 Buckle up.
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0:19:52 Welcome back.
0:19:54 We asked and read it delivered.
0:19:55 Let’s bust right into it.
0:20:00 All right.
0:20:02 Armand8194 asks,
0:20:06 Scott, something you used to preach is exclusivity as a great marketing tactic.
0:20:10 No is the sexiest word in the English language.
0:20:10 I always say that.
0:20:13 But recently, you’ve been releasing more and more podcast content.
0:20:15 Can you reconcile the two?
0:20:16 Yeah.
0:20:18 So it’s a fair point.
0:20:20 And that is, and I worry about this a lot.
0:20:23 So we had Pivot.
0:20:24 Then I launched PROFG.
0:20:25 Then PROFG Markets.
0:20:26 Now we have Raging Moderates.
0:20:32 So I’m like AOL in the 90s when you’d stick your hand in a cereal box and you’d pull out a CD-ROM of AOL.
0:20:34 I mean, it’s like to resist is futile.
0:20:40 And I do worry that the ubiquity of me, that people are going to start to have a gag reflex.
0:20:41 I go, Jesus, this guy again.
0:20:46 So what I’m trying to do is create more enterprise value.
0:20:47 What do I mean by that?
0:20:51 So my co-host on PROFG Markets, Ed Elson, does the interviews now.
0:20:55 My co-host on Raging Moderates, Jess, does all the interviews.
0:20:57 So I’m only on about half of the episodes.
0:20:58 We’re about to go daily.
0:21:02 Speaking of like too much of anything is not a good thing.
0:21:06 We’re about to go daily on PROFG Markets because the markets are daily.
0:21:08 And I’m only going to be on twice a week.
0:21:11 I’ll do some like impromptu guest appearances.
0:21:15 But what you’re saying is absolutely true.
0:21:17 I try and create scarcity across my speaking.
0:21:21 I price my speaking fees at sort of an outrageous dollar amount because one, I don’t want to work
0:21:24 that hard and I only want to go to places I like.
0:21:25 And two, pricing is a signal.
0:21:27 So scarcity is key.
0:21:29 I’m very cognizant of that.
0:21:31 I try and take time off, one, because I’m lazy, but B.
0:21:35 So my co-host on Pivot, Kara Swisher, does pretty much every episode.
0:21:37 I take the month of August off.
0:21:38 I take weeks off at a time.
0:21:42 I’m doing a college tour with my son and they said, we’ll set you up for a moment.
0:21:42 I’m like, no, you won’t.
0:21:43 Just find a guest host.
0:21:47 So I think it’s important to have a little bit of scarcity value.
0:21:49 And I’m very cognizant of it.
0:21:50 And quite frankly, you’re right.
0:21:55 I’m worried that at some point I’m just going to dilute my brand equity and it’s just going
0:21:58 to be too much and people are going to get sick of dick jokes.
0:21:59 I’m cognizant of it.
0:22:03 Your theory goes to an important marketing theory, and that is the most profitable companies
0:22:07 in history that have the greatest gross margins create the illusion of scarcity.
0:22:13 I’m wearing a Panerai watch, which is $1,000 of movements, plastic, and glass that they charge
0:22:17 $11,000 for because they’ve created this illusion that Panerais are scarce.
0:22:23 They purposely constrict supply such that when you see the watch you want, they can honestly
0:22:24 say, well, we only have one.
0:22:29 We have artificially reduced the supply of freshman seats at elite universities.
0:22:35 I’m cognizant of the fact that I might be moving myself from what is kind of a scarcity
0:22:37 luxury brand to a mass brand.
0:22:44 And I’m trying to ensure that it’s just not too much Scott all the time through co-hosts
0:22:46 and limiting or reducing some of my appearances.
0:22:48 But you clearly have an instinct for marketing.
0:22:52 And the illusion of scarcity is so important.
0:22:53 In life, it’s really important.
0:22:58 In an interview, when you’re interviewing with somebody, start asking them questions and act
0:23:02 as if you’re interviewing them and give them the impression that you might have another
0:23:06 offer, that you are so good at what you do that you are interviewing them.
0:23:07 Why?
0:23:11 Because my human capital is scarce and a lot of people want to rent it.
0:23:14 You don’t want to be too available to potential romantic partners.
0:23:20 You have to have lines that say, okay, this is unacceptable or don’t be too available.
0:23:22 Scarcity.
0:23:26 Yeah, I think your instincts are right on.
0:23:32 You want to maintain, again, any high margin product equals the illusion of scarcity.
0:23:33 Thank you for the question.
0:23:35 All right.
0:23:36 Next question.
0:23:42 Scott, when you hear or come up with your dirty jokes, where is the line where you think,
0:23:44 ooh, that is too far?
0:23:49 Okay, so I am generally a profane or vulgar person, but there’s a strategy behind it.
0:23:52 And that is, all strategy comes down to one question.
0:23:59 What can we do that is really hard, or put another way, what can we do that our competition
0:24:00 can’t do?
0:24:07 Amazon and Netflix spend tens of billions of dollars on infrastructure and fulfillment and
0:24:11 on content because their competitors can’t because they don’t have access to cheap capital.
0:24:16 So they’re like, okay, Netflix goes, if we spend $18 billion on content, Peacock just
0:24:17 can’t do it.
0:24:18 Hulu can’t do it.
0:24:19 Disney Plus can’t do it.
0:24:20 Even HBO can’t do it.
0:24:22 And so that’s where they go.
0:24:26 And they focus on this kind of brute force spending strategy.
0:24:31 Where I have decided to go in terms of trying to differentiate my podcast is, quite frankly,
0:24:37 one of the reasons I am really crude is that, one, CNBC can’t tell dick jokes.
0:24:41 And I want to be known as provocative and profane.
0:24:47 I also think that if you’re funny and profane, it kind of softens the beach and people become
0:24:48 more open to new ideas.
0:24:51 Also, I want to appeal to younger people.
0:24:57 And quite frankly, young men respond to my type of profanity.
0:24:58 Sometimes I go too far.
0:25:01 Sometimes I can hear myself, the words coming out and thinking, you know, that’s a little
0:25:02 bit much.
0:25:07 I’ve had parents write in and say, I’d like to play this with my kids, but I’ve stopped because
0:25:07 you’re so crude.
0:25:11 I’ve had CEOs call me and say, I would have sent this clip to the entire company, but I can’t
0:25:16 be seen or heard sending out something with these types of, this type of profanity.
0:25:22 I also, my kind of heroes are comedians that were social commentators and were also really
0:25:23 profane.
0:25:26 Whether it was Richard Pryor or Lenny Bruce, or I think Bill Burr is a genius.
0:25:28 These guys are not afraid to be profane and vulgar.
0:25:30 So one, it’s genuine.
0:25:31 I’m a profane and vulgar person.
0:25:33 Two, I want to appeal to young men.
0:25:37 I want my content to resonate with them such that to listen to some of the lessons I have
0:25:40 about what I hope is a positive vision of masculinity.
0:25:45 And also, just purely strategically, it is clear when you listen to the show, this is not
0:25:47 your father’s CMBC.
0:25:48 I appreciate the question.
0:25:54 And just so you know, the other day, I walked into my son’s room to have the sex ed talk
0:25:57 and I walked in with a, you know, with a condom and a banana.
0:25:59 And he said, what’s the banana for?
0:26:02 And I’m like, well, I can’t get hard on an empty stomach.
0:26:04 That’s good.
0:26:05 Thanks for the question.
0:26:11 Hey, Scott, they say wealth typically lasts about three generations.
0:26:15 Are you doing anything different in the way you are raising your children to prepare them
0:26:19 for the advantages they will have entering the market and how to contextualize them?
0:26:21 Are you even considering this as a concern or is it overblown?
0:26:23 Oh, no, it’s a huge concern.
0:26:31 I’m worried if my parents had been wealthy and I knew that was sort of a backstop or a
0:26:35 hammock, the only two things I know I would have in my life if my parents were rich were
0:26:37 a Range Rover and a cocaine habit.
0:26:44 I was, my motivation didn’t come from wanting to be successful or wanting to have a positive
0:26:45 impact on the world.
0:26:48 My motivation was I grew up without money.
0:26:49 It was humiliating for me and my mom.
0:26:53 And I was very focused on, okay, what can I control?
0:26:57 I can control how hard I work and the risks I take because I want economic security.
0:27:00 My kids probably don’t have that same fire.
0:27:03 I think about it a lot.
0:27:06 I think about, you know, not spoiling them.
0:27:07 You fly somewhere nice.
0:27:08 You’ve worked hard.
0:27:10 You want to fly business or first class.
0:27:16 And then I see my 14-year-old playing with his flat seat and I see a 70-year-old woman
0:27:16 roll by.
0:27:17 I’m going to coach.
0:27:18 And I think this is just wrong.
0:27:21 And I say to my partner, the kid should not be in business.
0:27:22 And she says, well, fine.
0:27:27 If you want to fly with coach and coach with them, have at it because they don’t allow kids
0:27:28 alone back in coach.
0:27:31 So the reality is my kids know they have money.
0:27:38 The good news is that I find a kid’s approach to money or anything else is that the parents
0:27:40 have less impact than you think.
0:27:43 And that is, as parents, we like to think we’re engineers.
0:27:44 We’re not.
0:27:45 We’re shepherds.
0:27:48 And that is, we get to choose the land they graze on, point them in the right direction,
0:27:49 decide what they eat.
0:27:51 But the sheep comes to you.
0:27:56 And what I have found is one of my sons, he won’t even let me buy stuff for him.
0:28:01 I’ll take him out and I’ll say, hey, we went to Sunspiel, this great kind of British brand
0:28:04 that’s supposed to be the casual brand for James Bond.
0:28:06 And I wanted to buy him a cashmere hoodie.
0:28:08 And it was 230 pounds.
0:28:08 He’s like, I’m not buying this.
0:28:10 I’m like, no, you’re not buying it.
0:28:10 I am.
0:28:12 He’s like, no, no, no, I’m not going to spend this kind of money on it.
0:28:16 He just is physically uncomfortable with spending money.
0:28:19 And I don’t know where he got that because even when I didn’t have money, I was very comfortable
0:28:20 spending money.
0:28:24 I’ve always, you know, I haven’t got a spending problem, but I’ve always been, I like to think
0:28:26 someone who enjoys life and is not afraid to spend money.
0:28:29 Whereas my other son is like, we’ll pop up and go, can I have two then?
0:28:33 So, and we just haven’t treated them that much differently.
0:28:34 I think about this a lot.
0:28:39 I’m going to put some money aside so they can have, always have access to housing, always
0:28:40 have access to education.
0:28:44 But my plan is to spend it all before I go.
0:28:47 My approach to spending is pretty promiscuous.
0:28:48 I spend a lot of money.
0:28:50 Every year I meet with my team at Goldman.
0:28:52 I look at how much money I made.
0:28:53 I already have my number.
0:28:58 And any additional money above that in terms of net worth, I either spend it or I give it
0:29:03 away because I want to make sure my kids have some advantage, housing, access to education.
0:29:06 But I don’t believe in dynastic wealth.
0:29:08 I know a lot of rich kids.
0:29:11 I wouldn’t say they’re any more fucked up than other kids, but they’re no less fucked up than
0:29:12 other kids.
0:29:16 So I don’t think you’re really giving much advantage to your kids with extraordinary wealth.
0:29:17 Is it a competitive environment?
0:29:21 Do you want them to have some of the opportunities that you’ve worked so hard to give them?
0:29:22 Yeah.
0:29:26 I want my kid to be able to live where he wants to live, to pick the career he wants to
0:29:28 pick, which is obviously extraordinary advantage.
0:29:31 But just being blunt, I’m going to offer that to my children.
0:29:35 I think you use money with your kids to lever up or lever down.
0:29:40 If one of my kids decides to teach public school, I’m going to probably give him a decent amount
0:29:41 of money.
0:29:49 If one is doing nothing and kind of just ne’er-do-well or I’m not going to give that kid any money.
0:29:55 So I think you have some control over it, not a lot, but it is something I think about all
0:29:55 the time.
0:30:01 And my approach, my way of expressing concern about this problem is I am spending money like
0:30:04 a fucking gangster in the 50s just diagnosed with ass cancer.
0:30:05 Hello.
0:30:06 Hello.
0:30:07 What, Vegas?
0:30:08 Daddy’s in.
0:30:09 The dog is in.
0:30:11 I start from yes.
0:30:14 That’s all for this episode.
0:30:18 If you’d like to submit a question, please email a voice recording to officehours at
0:30:19 prof2media.com.
0:30:21 That’s officehours at prof2media.com.
0:30:26 Or if you prefer to ask on Reddit, just post your question on the Scott Galloway subreddit
0:30:30 and we just might feature it in our next Reddit hotline segment.
0:30:31 What a thrill!
0:30:44 This episode was produced by Jennifer Sanchez.
0:30:45 Our intern is Dan Shallon.
0:30:47 Drew Burrows is our technical director.
0:30:50 Thank you for listening to the Prof G pod from the Box Media Podcast Network.
0:30:55 We will catch you on Saturday for No Mercy, No Malice, as read by George Hahn.
0:31:01 And please follow our Prof G Markets pod wherever you get your pods for new episodes every Monday
0:31:01 and Thursday.