Speaker 1: Hey, guys, ready or not, twenty twenty four is here,
Speaker 1: and we here at breaking points, are already thinking of
Speaker 1: ways we can up our game for this critical election.
Speaker 2: We rely on our premium subs to expand coverage, upgrade
Speaker 2: the studio ad staff give you, guys, the best independent.
Speaker 3: Coverage that is possible.
Speaker 2: If you like what we're all about, it just means
Speaker 2: the absolute world to have your support. But enough with that,
Speaker 2: let's get to the show. There's always been a lot
Speaker 2: of questions about Bohemian Grove ever since Richard Nixon was
Speaker 2: caught on tape talking about it, since Alex Jones infiltrated
Speaker 2: it and gave us some shocking footage from inside. But
Speaker 2: this one is actually a much more pedestrian problem.
Speaker 3: Let's gohead. Put this up there on the screen.
Speaker 2: The actual workers at Bohemian Grove are suing the elite
Speaker 2: club for wage theft. What they say is that Bohemian Grove,
Speaker 2: despite being a billion air playground, is accused of failing
Speaker 2: to pay overtime and not giving them enough breaks. In fact,
Speaker 2: one worker described members as obscenely wealthy, with private jets,
Speaker 2: multimillion dollar cars, two hundred thousand dollars watches homes on
Speaker 2: the beach in Malibu. They said that they would have
Speaker 2: to perform tasks that or beyond their job duties, including
Speaker 2: such as one instance where a billionaire member forgot to
Speaker 2: bring underwear to the camp and the valets were asked
Speaker 2: to hand wash it. They explained over the years, the
Speaker 2: conditions overwork, lack of pay for overtime, lack of breaks
Speaker 2: worsening despite promises for workers do better. They include quote
Speaker 2: kind words from some of the very wealthy members friendship
Speaker 2: coworkers coming back year after year for their job. It's
Speaker 2: still going on, and they say that even if you
Speaker 2: work twenty three and a half hours a day, your
Speaker 2: daily rate is still your daily rate. So surprised to
Speaker 2: no one, the billionaire kind of secretive hub remains a
Speaker 2: place where their staff apparently doesn't get treated very well.
Speaker 2: And you know, if you're going to ask a guy
Speaker 2: to hand wash your underwear, you may want to pay
Speaker 2: him well. Is when you're at worth that much so
Speaker 2: that he doesn't talk about it.
Speaker 3: In the press.
Speaker 1: I mean, that's the thing, is like these people could
Speaker 1: afford to treat these workers like very well, and then
Speaker 1: you wouldn't have this lawsuit and all these embarrassing claims
Speaker 1: out in the press, and to get more specific, they
Speaker 1: say that the Bohemian Grove treasure Bill Dawson has personally
Speaker 1: directed workers to falsify payroll records and to work off
Speaker 1: the clock.
Speaker 4: The valets here say.
Speaker 1: They were only paid for eight hours despite working sixteen
Speaker 1: plus hours a day, sixteen plus hours a day without
Speaker 1: breaks for the duration of the fourteen day summer camp.
Speaker 1: Another allegation claims a worker was directed to hide from
Speaker 1: a payroll employee when they made a surprise visit to
Speaker 1: the camp as they were being paid under the table.
Speaker 1: We just want this to stop, said a former valet
Speaker 1: at the camps to requested to remain anonymous for fear
Speaker 1: of retaliation from the clubs or members.
Speaker 4: I mean, this is like.
Speaker 1: Our whole society just in a nutshell right here, workers
Speaker 1: being used in abuse, these incredibly wealthy, powerful, secretive billionaires
Speaker 1: thinking that just them being like offering them some kind
Speaker 1: words is all they really want and need, not like
Speaker 1: actually getting paid for the hours that they're working and
Speaker 1: not being treated like indentured servants.
Speaker 4: Unbelievd. I mean, it's just it's too perfect.
Speaker 3: Honestly, it is a bit too perfect. So there you go.
Speaker 3: The latest from Bohemian Grove. Will keep everybody updated and
Speaker 3: we'll see you later.
Speaker 1: So if you have existed online, you are probably aware
Speaker 1: of a new phenomena where a number of orcas has
Speaker 1: been attacking primarily yachts off the Iberian Peninsula. And apparently,
Speaker 1: so the story goes, according to scientists, there may have
Speaker 1: been one Orca that originally was traumatized by one of
Speaker 1: these boats, learned how to ram and disable them, and
Speaker 1: has taught her Orca friends how to do. They're riding
Speaker 1: back and that has really captured the imagination of people
Speaker 1: online who've been talking about in Orca uprising against the yachts.
Speaker 1: So onque of course, the Atlantic has to come in
Speaker 1: as a buzzkill for everyone involved and pen this way
Speaker 1: too self serious piece, go on and put it up
Speaker 1: on the screen titled killer whales are not our friends?
Speaker 1: Stop rooting for the Orcas ramming boats. This is by
Speaker 1: Jacob Stern. I'll read you a little bit at the
Speaker 1: beginning so you get a sense of it. In recent months,
Speaker 1: orcas and the waters off the Iberian peninsul have taken
Speaker 1: a ramming boats. The animals have already sunk three this year,
Speaker 1: damaged several more. After one of the leavest incidents, in
Speaker 1: which a catamaran lost both of its runners, the boat's
Speaker 1: captain suggested the assailants have grown stealthier and more efficient.
Speaker 1: Looks like they knew exactly what they're doing, he said.
Speaker 1: Scientists have documented hundreds of orca boat incidents off the
Speaker 1: Spanish Portuguese coast since twenty twenty, but news coverage of
Speaker 1: these attacks is blowing up right now, thanks in part
Speaker 1: to a creative new about why they're happening.
Speaker 4: Couldtation vengeance? Now that's a story.
Speaker 1: This author then goes on to talk about how you
Speaker 1: shouldn't like, idealize or anthropomorphize orcas, and that if you
Speaker 1: want to do that, they're actually really brutal and terrible.
Speaker 1: Though recent events may fit the story of these organs
Speaker 1: being anti colonial warriors. Lol, you can't just anthropomorphize animals selectively.
Speaker 1: What about all the other evidence we have of orc
Speaker 1: as cruelty or even wickedness. Scientists say they hunt and
Speaker 1: slaughter sharks by the dozen, picking out the liver from
Speaker 1: each one and leaving the rest of the carcasses.
Speaker 4: To rot Uneaten orc is killed for sport.
Speaker 1: They push, drag, and spin around live prey, including sea turtles, seabirds,
Speaker 1: and sea lions. Some go as far as to risk
Speaker 1: breaching themselves in order to snag a baby seal, not
Speaker 1: to consume, but simply to torture it to death. Once
Speaker 1: you start applying human ethical standards to apex predators, things
Speaker 1: turn dark. Fasts your views on hashtag ORCA uprising.
Speaker 2: I mean, I still support them. Yeah, they're vicious killers,
Speaker 2: but so are a lot of things in the animal kingdom.
Speaker 2: So what I mean it's also like, yeah, like you said,
Speaker 2: why are we taking this so seriously in general? I mean, look,
Speaker 2: even if they are the vicious demons of the sea,
Speaker 2: we're the ones who are hurting them, So like, why
Speaker 2: shouldn't they make us? Yeah, exactly, we're the vicious demons
Speaker 2: of the land. I guess whenever you look at it.
Speaker 2: So I thought, the whole thing is a bit silly.
Speaker 2: And I also I don't like though that he's actually
Speaker 2: falling into the trap of so called anthropomorpha right, portraying
Speaker 2: it as somehow putting a value judgment on killing baby seals.
Speaker 2: It's like, okay, well, actually, a huge number including us
Speaker 2: not that long ago of species in the animal kingdom
Speaker 2: kill their young like it happens quite often, including our
Speaker 2: closest cousins, the chimpanzees. Bears literally eat many of their
Speaker 2: young sometimes. I believe in some cases where there's like
Speaker 2: a offspring of another alpha male who's killed, that all
Speaker 2: of their offspring will just be killed. It's part par
Speaker 2: for the course in the animal kingdom. That's the brutality
Speaker 2: if you even think it's brutal of evolution. In many ways,
Speaker 2: it's actually a very elegant system. So it's one of
Speaker 2: those where I get annoyed at this value judgment on
Speaker 2: the orca itself. And I think that any time, and
Speaker 2: this is a little Ted Kaczynski hat coming on, where
Speaker 2: you see things in the wild evolve as a system
Speaker 2: to try and push back against the encroachment of mankind,
Speaker 2: can't help but cheer for it.
Speaker 1: Just the thing that just to me was so funny
Speaker 1: is like everyone's joking about, like everyone's having a good
Speaker 1: time on the internet with this right making memes doing
Speaker 1: their thing, pretending that the orcas are anti colonial warriors
Speaker 1: like they said, And then you have to come in
Speaker 1: and do this like very self serious analysis of well,
Speaker 1: actually they kill baby cereals and blah blah, bless, like
Speaker 1: no one was actually thinking that the orcas were like
Speaker 1: the vanguard of the revolution. Here, guys, everyone's just having
Speaker 1: fun on the internet. I liked some of their responses
Speaker 1: to this piece. One of them said they're not called
Speaker 1: best friend whales after all. Another one said did a
Speaker 1: yacht right, which I thought was pretty good. And then
Speaker 1: also regards to like the rogan RFK thing, there were
Speaker 1: a bunch of like one hundred thousand dollars to be
Speaker 1: the orca thing. So anyway, that's the state of the discourse.
Speaker 5: I'm with the organs.
Speaker 3: I still think organs are cool.
Speaker 2: I think what they do is brutal, but I think
Speaker 2: a lot of things that are in the animal Kingdom
Speaker 2: are brutal in facts, that's what I think is cool.
Speaker 2: Some interesting developments in the social media world. It looks
Speaker 2: like Mark Zuckerberg will be launching a new Twitter competitor.
Speaker 2: Let's go ahead and put this up there on the screen.
Speaker 2: They are calling it Threads. It will be was code
Speaker 2: named inside of the company called Project ninety two, and
Speaker 2: screenshop screenshots suggest it will feature continuous scroll of text
Speaker 2: like Twitter with buttons similar to like and to retweet. Ryan,
Speaker 2: You've been looking into this a little bit for us.
Speaker 2: What do you know what's going on here?
Speaker 6: So basically what's coming out of Facebook is they think
Speaker 6: that Facebook is I mean sorry, they think that Twitter
Speaker 6: is quite vulnerable advertising revenue collapsing. And you've got a
Speaker 6: lot of liberals, kind of liberals freaking out about it leaving.
Speaker 6: And you've got they're thinking is that athletes and celebrities,
Speaker 6: which which once made Twitter, you know, the kind of
Speaker 6: place that it was for everybody to be, are themselves
Speaker 6: with me. Because if if the journalists are going somewhere else,
Speaker 6: then the athletes and the celebrities who are there because
Speaker 6: the journalists are there that are going to go somewhere
Speaker 6: else as well. And so what they're doing is they're
Speaker 6: linking it up with Instagram but making it a separate account.
Speaker 6: So the way it would work is that if you're
Speaker 6: on Instagram, you can port your user name over and
Speaker 6: you can alert all of your followers that you're that
Speaker 6: you're over there, and your blocklists, your safety features that
Speaker 6: people appreciate over at Instagram, know the ways those will
Speaker 6: all carry over.
Speaker 5: To the other thing. And so they're really gearing this
Speaker 5: toward I think.
Speaker 6: The kind of people who are interested in a Mastadon
Speaker 6: or a Blue Sky, And in fact, they're saying it
Speaker 6: will be interoperable with Mastadon.
Speaker 3: See that's where I'm confused.
Speaker 2: How would it be interoperable Because Masdenon is a decentralized
Speaker 2: I'm assuming they're building it on top of that arc.
Speaker 6: So this would also be decentralized as well. And so
Speaker 6: they're reaching directly out to a bunch of celebrities and
Speaker 6: athletes trying to convince them to come over, which is
Speaker 6: the opposite of Elon Musk's approach, which is to reach
Speaker 6: out directly to celebrities and athletes and insult them, try
Speaker 6: to try to try.
Speaker 4: Well.
Speaker 2: See that's the fascinating part here, which is in terms
Speaker 2: of how you can actually get this going, you would
Speaker 2: need a actual network of people. Because we talk about
Speaker 2: this all the time. We had Jack Dorsey on the
Speaker 2: show very recently. We asked them about it. And you know,
Speaker 2: the whole point of Twitter is that everybody's on Twitter, right,
Speaker 2: you know, it's the network effect of all of that.
Speaker 2: So when you start an alternative, you going after elite
Speaker 2: users is smart because you know, Twitter is really only
Speaker 2: used by some ten percent of its user base. It's
Speaker 2: more like everybody follows those people and to the extent
Speaker 2: they engage with that they're engaging with like replies, retweets
Speaker 2: of those individual very small select group.
Speaker 3: The problem though, is that.
Speaker 2: You still need the masses of people to make it
Speaker 2: in an effective communication tool. That said, it's not a
Speaker 2: smart it's not a dumb play because you look at
Speaker 2: this company, it's in turmoil. You know, people, whether people
Speaker 2: are engaged or using it, nobody knows based on the data.
Speaker 2: If there was ever a time where you might be
Speaker 2: able to replace it, it could be Now Facebook has
Speaker 2: good relationship with advertisers. They obviously if they've got the
Speaker 2: cash and the money to burn as much as possible
Speaker 2: to try and prop it up for as long as needed.
Speaker 3: So maybe it'll work. I don't know.
Speaker 6: And if it does work, what it would probably wind
Speaker 6: up being is a liberal Twitter, right, and which would
Speaker 6: fit into the way that we're kind of splintering in
Speaker 6: our social media world that it's basically impossible, kind of
Speaker 6: to build these mono platforms anymore where everybody is on board,
Speaker 6: because you already see an over on Blue Sky. As
Speaker 6: you see conservative people start to join right, then you
Speaker 6: then see a reaction of people saying, well, I'm quiting
Speaker 6: if this person's over over here. Like the idea that
Speaker 6: you're everybody can be on the same platform seems very
Speaker 6: It seems quaint at this point, and so I could
Speaker 6: imagine it being uh, you know, it would run from
Speaker 6: the left to the never trumpers.
Speaker 3: Yes, it's very possible.
Speaker 2: No, No, I mean I think the use case is there
Speaker 2: for a small number of political users. The question is
Speaker 2: it there for everybody else. Let me give you an example.
Speaker 2: I Well, one of the ways that I relax is
Speaker 2: I like to listen to like business podcasts, like stuff
Speaker 2: that has nothing to do with politics. You know, it's
Speaker 2: been interesting for me and for Crystal, Like we never
Speaker 2: you know, intended to become small business people and suddenly
Speaker 2: we're running a business and it's like it's it's fun
Speaker 2: for me to listen and to engage. For example, I'm
Speaker 2: giving this examples business Twitter, So like I'm looking at
Speaker 2: all these entrepreneurships. Some of these people are really annoying
Speaker 2: and they're faking, you know, their business. But somebody you
Speaker 2: learned some cool stuff there anytime I get into a
Speaker 2: sub watches for example, or I like the watch if
Speaker 2: this is actually an Omega swatch, the Moon swatch, and
Speaker 2: you know, let's start looking. You know, if you engage
Speaker 2: with it a little bit, you'll find these fascinating threats.
Speaker 7: You know.
Speaker 2: That's where I don't know if the user base of
Speaker 2: current Twitter, I think they're fine.
Speaker 3: You know, watch Twitter.
Speaker 5: They don't care about the vigureship, whatever's going Watch.
Speaker 2: I think Watch, We're just gonna stay. There's nothing wrong
Speaker 2: with current Twitter. There's nothing wrong with you know, the
Speaker 2: men's wear guy.
Speaker 3: I love that guy, by the way, Derek Guy on Twitter.
Speaker 3: He's a Here's lib.
Speaker 2: But you gotta give it to him. The man knows
Speaker 2: that address. He's got great taste. His threads you know,
Speaker 2: and stuff are very useful. I don't see like there's
Speaker 2: there's nothing wrong for his with Twitter. For him right now,
Speaker 2: right like, it's actually working well. There are multiple different
Speaker 2: Twitter subcultures that I live in and engage with, of
Speaker 2: which censorship is just not an issue. Like and from
Speaker 2: what I've been told, NBA, Twitter is lit.
Speaker 3: It's so much fun.
Speaker 2: If you ever watch TV, if you're engaged in like
Speaker 2: shows I like to watch trashy reality TV sometime my fiance.
Speaker 2: My fiance tells me that Love Island Twitter is the
Speaker 2: best Twitter, right, So for them, you know, they don't
Speaker 2: they're not having issues, so that you and I could
Speaker 2: talk about here with all of that's the real success.
Speaker 2: You know, you have to be able to get normy
Speaker 2: stuff that has nothing to do with politics over. I
Speaker 2: just question whether that will pour it over to Yeah.
Speaker 2: Actual it's a competitor. It's a real question, and.
Speaker 6: It raises a question of what was it that originally
Speaker 6: brought everybody over to Twitter? And in my kind of
Speaker 6: oral history of it, I would say that it was
Speaker 6: in you know, twenty eight nine ten. Journalists, whether it's
Speaker 6: sports journalists, political journalists, are there. Watch journalists, Ye, there
Speaker 6: are actually watching, Yes, shout out to because because the
Speaker 6: watch journalists were there and the big watchmakers, yeah, are
Speaker 6: going to be there and so and then people are
Speaker 6: going to like watching the kind of engagement back and
Speaker 6: forth between the watchmakers and the watch journalists.
Speaker 5: And same with sports.
Speaker 6: Same of course in politics you don't have the same
Speaker 6: kind of world of journalism that you had in twenty ten'rue.
Speaker 6: And so even if you did get everybody from CNN
Speaker 6: and MSNBC in the New York Times to join this
Speaker 6: new Twitter.
Speaker 5: If they end up calling it threads or whatever.
Speaker 6: That doesn't necessarily mean the same to the public because
Speaker 6: what the old Twitter is. Because all the journalists were there,
Speaker 6: then the politicians were there, and then the politicians realized
Speaker 6: that they had to be authentic if they wanted to
Speaker 6: get any engagement.
Speaker 5: And then people were like, oh, wow, we're actually engaging.
Speaker 6: I can yell at a politician and the right and
Speaker 6: they care about and they actually, we'll do something about
Speaker 6: it too. But if the politicians don't believe that the
Speaker 6: journalists have the same power that they used to, then
Speaker 6: they're not going to engage in the same way.
Speaker 5: So I don't know. It depends on what kind of
Speaker 5: world we live in whether or not this can be recreated.
Speaker 5: Maybe it can. Maybe this is a river that has
Speaker 5: just and the water is flown.
Speaker 3: By maybe right.
Speaker 2: Yeah, I'm not so sure a competitor will work, but
Speaker 2: I'm interested.
Speaker 3: I always like looking at new stuff.
Speaker 2: You know, something that I think a lot of people,
Speaker 2: including me, who thought that social media was dead and
Speaker 2: was over, was the rise of TikTok TikTok completely cannibalized Instagram,
Speaker 2: it nuked a lot of short form video competitors, and
Speaker 2: it's the unequivocal winner in the social media war within
Speaker 2: just a couple of years in the United States. So,
Speaker 2: you know, put the Chinese complaints about it aside, of
Speaker 2: which I very much agree with. But as a matter
Speaker 2: of tech, it worked. I mean, it disrupted the industry completely.
Speaker 2: So that is you know, sho, we shouldn't count these
Speaker 2: things out before they happen. I'm a little bit skeptical,
Speaker 2: but again, like I said, you never know.
Speaker 8: Hey, folks, it's Kink Clippin sign with breaking Points, the
Speaker 8: Intercept edition. I want to talk to you today about
Speaker 8: my new story titled Pentagon's Secret Service troll social media
Speaker 8: for mean tweets about generals. Let's get element one up
Speaker 8: on the screen there. So when Chairman of the Joint
Speaker 8: Chiefs of Staff General Mark Milly enters into his scheduled
Speaker 8: retirement later this year, one of the perks he'll enjoy
Speaker 8: will be a personal security detail to protect him from threats,
Speaker 8: including even embarrassment. That's right, your tax dollars will pay
Speaker 8: for this via the Pentagon's equivalent to the Secret Service,
Speaker 8: and that's called the US Army Protective Services Battalion. The
Speaker 8: battalion is tasked with safeguarding top military brass from the
Speaker 8: Chairman of the Joint Chiefs to the Secretary of Defense.
Speaker 8: The unit protects these current as well as former and
Speaker 8: retired high ranking military officers from assassination, kidnapping, injury, or embarrassment.
Speaker 8: And that's a direct quote from Army records that I'd
Speaker 8: like to show you, guys on Element two on the
Speaker 8: screen now. So this reporting is based on a number
Speaker 8: of obscure government documents I obtained in which I'm going
Speaker 8: to show you during this episode. So you don't have
Speaker 8: to take my word for any of this, and I
Speaker 8: don't blame you if you don't, because a lot of
Speaker 8: it is pretty outrageous. To give you some background, the
Speaker 8: battalion has existed under a number of different names going
Speaker 8: back to nineteen seventy one, but more recently it expanded
Speaker 8: its mandate to include, let's get Element three on the
Speaker 8: screen now, monitoring social media for quote direct, indirect and
Speaker 8: veiled threats, as well as identifying quote negative sentiment regarding
Speaker 8: the people that it protects. According to a procurement document,
Speaker 8: dated twenty twenty two. So the country's national security apparatus
Speaker 8: has become pretty obsessed with disinformation and social media, particularly
Speaker 8: after the twenty sixteen election, as I've reported on this
Speaker 8: show before, and as a consequence of that, agencies and
Speaker 8: offices have sprouted like daisies and just proliferated all across
Speaker 8: the federal government to try to respond to.
Speaker 7: This purported threat.
Speaker 3: Protective details of the past.
Speaker 8: Generated a know, a pretty fair amount of controversy, particularly
Speaker 8: the trub administration might recall his Education Secretary of Bessie Devas,
Speaker 8: had an around the clock security detail that racked up
Speaker 8: over twenty four million dollars in costs, led to a
Speaker 8: huge scandal whole news cycle. Sam was the case with
Speaker 8: Scott Pruitt, who ran up over three point five million
Speaker 8: dollars and led to a Inspector General report that said,
Speaker 8: you know, what was the reason for any of this?
Speaker 8: That they weren't very persuaded by the threats that he alleged.
Speaker 8: But now that it's the Biden administration, you don't hear
Speaker 8: much about this stuff anymore. But so the procurement document
Speaker 8: that I described before, which I obtained an unredacted copy
Speaker 8: of describes the armi's need to quote mitigate online threats
Speaker 8: as well as identify positive or negative sentiment about top
Speaker 8: defense officials. Let's get element four up on the screen
Speaker 8: now to quote from it. It says that the Battalent
Speaker 8: has a requirement to provide services to the Department of
Speaker 8: Defense officials in order to mitigate online threats direct indirect
Speaker 8: or veiled, as well as identify positive or negative sentiment
Speaker 8: about these senior high risk personnel. Let's get element five
Speaker 8: on the screen now. So here, the document goes on
Speaker 8: to describe the software it would used to do that,
Speaker 8: and that that is a reliable threat mitigation social media
Speaker 8: threat mitigation service, a web based toolkit with advanced capabilities
Speaker 8: to publicly to collect publicly available information, and also to
Speaker 8: provide the military with anonymity. When it goes about doing that,
Speaker 8: I mean, that's a really interesting point. Why do they
Speaker 8: need the anonymity?
Speaker 3: They don't say so.
Speaker 8: Long story short, your texts are paying for the Pentagon
Speaker 8: to monitor social media and things like negative sentiment and
Speaker 8: direct indirect or failed threats. What any of that means
Speaker 8: is your guest as good as mine, Because they don't
Speaker 8: define any of it and When I went to go
Speaker 8: ask them for comment, as I always do, they wouldn't.
Speaker 8: They didn't have an answer for me. But what we
Speaker 8: do know is that they're they're putting money towards trying
Speaker 8: to meet these threats and and and protect these generals
Speaker 8: from whatever or however it is that they define veiled
Speaker 8: and indirect threats and negative sentiment. So make that what
Speaker 8: you will. Once again, I'm Kinklbin sign with Breaking Points
Speaker 8: Center Set Edition. Thanks so much for joining me. Guys.
Speaker 9: Hey, I'm Matt Stoler, author of monopoly focused substack newsletter
Speaker 9: Big and an anti trust policy analyst. Have a great
Speaker 9: segment for you today on this Big Breakdown. It's an
Speaker 9: anti trust analysis of the proposed merger between the PGA
Speaker 9: Tour and the Saudis Live Golf, which was announced about
Speaker 9: two weeks ago. It actually already feels like quite a
Speaker 9: while and the narrative on the deal since it was
Speaker 9: first announced has completely changed, So I'm going to go
Speaker 9: into that as well. Okay, so let me give you
Speaker 9: the TLDR. The deal is already falling apart. Now, first,
Speaker 9: let's start at the beginning. Here's c NBC's David Faber
Speaker 9: going on the details of what happened the day of
Speaker 9: the announcement.
Speaker 10: The PGA Tour and at Saudi back competitor Live Golf,
Speaker 10: along with Europe's DP World Tour, have agreed to merge
Speaker 10: in expectation of creating a global entity for the game
Speaker 10: of golf. The agreement, which is not yet a definitive agreement,
Speaker 10: the hostility between Live and the PGA, along with the
Speaker 10: litigation between the parties, and it calls for the giant
Speaker 10: Saudi Sovereign Wealth Fund PIF, which created Live, to invest
Speaker 10: significant I'm told what will be billions of dollars into
Speaker 10: the new entity.
Speaker 3: That's over time.
Speaker 7: Okay, So it was a big deal. It was a
Speaker 7: huge deal.
Speaker 9: It was announced globe changing, you know, the Saudi's geopolitical
Speaker 9: like changing the world of golf, like Donald Trump was
Speaker 9: involved as sort of a massive, massive thing.
Speaker 7: But here is the gist of the term.
Speaker 9: So this was according to the Athletic as best as
Speaker 9: they could tell.
Speaker 7: Okay.
Speaker 9: So the tour is receiving upwards of two to three
Speaker 9: billion dollars plus all the litigation between the two parties,
Speaker 9: and there's a lot of it, and it's very bitter.
Speaker 9: Is going away now the background to this deal, as
Speaker 9: far as we can tell, and there here's important context
Speaker 9: is that the PGA Tour has been the ruler of
Speaker 9: pro golf for many decades. In nineteen ninety four, for example,
Speaker 9: the Federal Trade Commission actually investigated the PGA Tour for monopolization.
Speaker 9: But Congress back then was, as one would expect, a
Speaker 9: fan of old rich golfers, and Congress actually threatened to
Speaker 9: cut the budget of the anti trust enforcers by twenty
Speaker 9: percent if they went ahead with a case. So the
Speaker 9: FTC said, okay, we'll drop the complaint. The vote was
Speaker 9: four to zero, and until twenty twenty one, that's pretty
Speaker 9: much how things in the world of pro golf remained. Then,
Speaker 9: the Saudi government, through its public investment funder PIFF, decided
Speaker 9: to finance a competitor to the PGA Tour.
Speaker 7: It's called Live Golf. Now.
Speaker 9: Live Golf started learning top players and putting on rival events,
Speaker 9: and it created competition in the space.
Speaker 7: Wasn't profitable.
Speaker 9: It was a sort of a geopolitical push, but it
Speaker 9: did create real competition for the first.
Speaker 7: Time in many decades.
Speaker 9: Now, part of this is that the two entities have
Speaker 9: been in a bitter antitrust suit over the nature of
Speaker 9: this competition, and it's been going on for about a year.
Speaker 9: There are allegations of anti competitive behavior on the part
Speaker 9: of the PGA Tour, and the PGA Tour itself is
Speaker 9: under investigation by the government.
Speaker 7: Yet again. Now the story gets weirder.
Speaker 9: As I noted, Donald Trump is involved with his properties
Speaker 9: hosting live golf events put on by his Saudi allies.
Speaker 9: He really wants in on professional golf money and PGA
Speaker 9: Tour prestige. Now, if you read the antitrust complaint filed
Speaker 9: against the PGA Tour last year, it seems pretty clear
Speaker 9: that the PGA Tour has been a problematic ruler of
Speaker 9: pro golf going back decades, but especially now when they
Speaker 9: actually face arrival. So quote, members of the tour receive
Speaker 9: a substantially lower percentage of the tour's revenues than professional
Speaker 9: athletes in other major sports end quote. That's what the
Speaker 9: players argued when Live began challenging the PGA Tour. It
Speaker 9: quote threatened lifetime bands on players who play in even
Speaker 9: a single live golf event and threaten sponsors, vendors, and
Speaker 9: agents to coerce players to abandon opportunities to play in
Speaker 9: live golf events.
Speaker 7: End quote.
Speaker 9: Now this bitterness, but also the general competition is consistent
Speaker 9: with pretty much all sports leagues. Rivalry and sports leagues
Speaker 9: tends to push up compensation for players, and consolidation tends
Speaker 9: to do the opposites what you'd expect with monopoly. When
Speaker 9: you are selling sports services as an athlete to one entity,
Speaker 9: you're a price taker. When you have a choice of two,
Speaker 9: they have to bid for your services. Okay, So to
Speaker 9: ward off the new competition, the strategy of the PGA
Speaker 9: Tour they want to maintain their monopoly, was to denigrate
Speaker 9: live golf as funded by murderous thugs. And because of
Speaker 9: the Saudi government's bad track record here on human rights,
Speaker 9: I mean, they're murderous thugs, a lot of players refuse
Speaker 9: to play in the new league. So this merger docked
Speaker 9: everyone who believed the PGA Tour's human rights rhetoric.
Speaker 7: Those who believed it. Of course.
Speaker 9: Now on a broader level, the public discussions were initially
Speaker 9: quite frantic about the rise of Saudi influence. Here's a
Speaker 9: headline in the New York Times the day of the deal.
Speaker 9: Oh my god, the Saudis are so influential now they
Speaker 9: weren't influential before. I saw Tom Friedman and Andrew Ross
Speaker 9: Sorkin on CNBC the morning of the announcement wondering whether
Speaker 9: the Saudis could do the same thing to the NBA
Speaker 9: or other sports leagues as part of this giant geopolitical
Speaker 9: play to control athletics, as if athletics is not already
Speaker 9: dominated by huge sums of money and corporate power. But
Speaker 9: let's ask a different question. Is this deal legal? Is
Speaker 9: it actually going to happen? After all, we have anti
Speaker 9: trust laws that prohibit illegal mergers. There is a lot
Speaker 9: of gray area and anti trust law. You know, some
Speaker 9: mergers it's like it's not totally clear that it's going
Speaker 9: to reduce competition, so it's not clear that the Clayton
Speaker 9: Act applies. That's what a lot of cases are about.
Speaker 9: But here's the thing. When two companies, the only two companies,
Speaker 9: want to merge to a monopoly and they announce it
Speaker 9: as such, that's just a violation of black letter law.
Speaker 9: And did that happen here? Well, for that, I'll go
Speaker 9: to the head of the PGA tour j Monaghan, who
Speaker 9: said that this merger is good for his organization because
Speaker 9: it allows them to quote take the competitor off.
Speaker 7: The board end quote.
Speaker 9: Okay, when a corporate leader publicly says the point of
Speaker 9: a merger is to monopolize a market and eliminate a competitor,
Speaker 9: I mean that's pretty crazy, and I can only imagine
Speaker 9: what's in the private correspondence that usually lawyers go through
Speaker 9: when putting together an anti trust case.
Speaker 7: Now it's not just me saying this.
Speaker 9: All of the anti trust nerds that I'm friends with
Speaker 9: or that I know were in total disbelief at the
Speaker 9: audacity of these deal makers. So scholar Herb Hobbin Camp,
Speaker 9: who's generally monopoly friendly and very well respected in the
Speaker 9: antitrust bar said that this merger would be problematic in
Speaker 9: at least three markets, so live attendance, TV, broadcast rights
Speaker 9: and advertising and call for compensation. Now, given that Live
Speaker 9: Golf and the PGA Tour have been bidding aggressively for
Speaker 9: the services of golfers, it seems pretty obvious that this
Speaker 9: deal will monopolize at least one of those markets. So
Speaker 9: that's how we antitrust works. It's about markets, specific markets.
Speaker 9: So Herb hobbin Camp puts out three markets, but others
Speaker 9: can do it differently. Everybody agrees that there's just a
Speaker 9: monopoly going on here. So now it is unusual for
Speaker 9: a corporate leader to announce he's doing a deal to
Speaker 9: remove a competitor. As Bloomberg reporter Leah Nylan reported, one
Speaker 9: reason he might be doing that is because quote, no
Speaker 9: antitrust lawyers were involved in the PGA Tour live discussions.
Speaker 7: That's crazy.
Speaker 9: Every merger of any size involves at least calling an
Speaker 9: anti trust lawyer and saying, hey, what do you think?
Speaker 7: But not this one.
Speaker 9: And so this choice to just not even talk to
Speaker 9: an anti trust lawyer when they actually have anti trust
Speaker 9: lawyers on retainers suing each other, it just doesn't make
Speaker 9: any sense.
Speaker 7: Both the PGA Tour and Live Golf.
Speaker 9: You know, they've got a big fight, and they didn't
Speaker 9: ask one of their anti trust lawyers to attend a
Speaker 9: meeting where they sought to merge to a monopoly. They
Speaker 9: also have deal maker lawyers, and it's well, they're not
Speaker 9: specialists in an anti trust like they know that, you know,
Speaker 9: two to one merger is illegal, So like what is
Speaker 9: going on here? And then there's the announcement itself, which
Speaker 9: is pretty vague. Apparently after saying it's a merger. The
Speaker 9: PGA Tour is now saying it's not a merger, it's
Speaker 9: an alliance, or it's a joint company in which they
Speaker 9: will put all assets, or maybe it's a framework.
Speaker 7: Who knows.
Speaker 9: One very clear point for the PGA Tour is that
Speaker 9: whatever this deal is, it is intended to remove a competitor,
Speaker 9: and legally that is what matters. So as a result,
Speaker 9: most anti trust lawyers who have commented on this deal publicly,
Speaker 9: from the far right to the far left, have scoffed
Speaker 9: at the very notion that this deal as announced is legal.
Speaker 9: So I'm going to put a couple of tweets on
Speaker 9: the board. Here's the former White House Competition chief Tim
Speaker 9: Wu He's a Columbia law professor's focus on anti trust.
Speaker 7: He tweeted the deal won't survive.
Speaker 9: Libertarian anti trust lawyer Josh Wright, who's at George Mason,
Speaker 9: he mocked the combination and indeed it is a joke. Indeed,
Speaker 9: it's so stupid that the PGA Tour and the Saudis
Speaker 9: have managed to turn Congress somehow against rich white golfers.
Speaker 7: That is on accomplishment.
Speaker 9: So Senator Richard Blumenthal, for instance, has demanded that the
Speaker 9: Anti Trust Division look into the merger. The Anti Trust
Speaker 9: Division is looking into the merger, and now the deal
Speaker 9: is probably going to face a challenge from enforces.
Speaker 7: It's like almost impossible not to.
Speaker 9: It's just it's just disrespectful to just merge to monopoly,
Speaker 9: like doing a cocaine deal, giant cocaine deal in front
Speaker 9: of a police station. There's also going to be a
Speaker 9: congressional hearing.
Speaker 7: Now. A different lawyer pointed out that.
Speaker 9: It's it actually gets worse because it's not just the
Speaker 9: Department of Justice with jurisdiction, but Great Britain and the
Speaker 9: European enforcers also have jurisdiction because you know, it's a
Speaker 9: global compinsation, it's a global monopoly. So now you can
Speaker 9: get around anti trust if they just pass a law
Speaker 9: saying that anti trust doesn't apply in this particular case.
Speaker 7: And that has happened.
Speaker 9: So in nineteen sixty six, when the AFL and the
Speaker 9: NFL wanted to merge football leagues, Congress actually had to
Speaker 9: grant an exemption to anti trust law. A side note,
Speaker 9: the politician who did that was from Louisiana and he said,
Speaker 9: if I'm going to grant this exemption, you have to
Speaker 9: start a football team in New Orleans, and that's why
Speaker 9: we have the New Orleans Saints. So you can thank
Speaker 9: anti trust for the New Orleans Saints. At any rate,
Speaker 9: The point here is that unless America, the American government,
Speaker 9: the European Union, and the British government all grant an
Speaker 9: anti trust exemption, as Congress did for football in sixty six,
Speaker 9: the deal seems kind of crazy. So okay, to put
Speaker 9: it nicely, the legal situation in dice is dicey, and
Speaker 9: that's starting to have impacts on the discussions of whether
Speaker 9: the deal will actually go through. So large Wall Street
Speaker 9: players are now possibly involved on the side of the
Speaker 9: actual golfers. So the legal situation is, to be nice, dicey,
Speaker 9: and that's starting to have impacts on the discussions of
Speaker 9: whether the deal will actually go through. Large Wall Street
Speaker 9: players are now possibly involved on the side of the golfers.
Speaker 9: Let's take a listen to CNBC talking about this.
Speaker 10: I'm also told that Patrick kent Lay, one of the
Speaker 10: players who's also a player director whose sponsor includes Goldman Sachs,
Speaker 10: is probably getting some good advice from the likes of
Speaker 10: Goldman Sacks. Here and has been an important voice here
Speaker 10: in terms of what are we going to get as
Speaker 10: players here for stepping up and saying yes to all
Speaker 10: of this, given that we were willing to accept a
Speaker 10: lot less to stay at the PGA, so to speak,
Speaker 10: than go to live golf.
Speaker 9: In light of how a lot of the players, like
Speaker 9: top player Roy McElroy, are responding to player compensation in
Speaker 9: this deal, it's hard to see how it's gonna go
Speaker 9: smoothie for all sides without a lot more money being
Speaker 9: put into the actual arrangements. So let's take a listen
Speaker 9: to what he said.
Speaker 6: Should the golfers who maybe stayed loyal and turned down
Speaker 6: live should they be made whole financially?
Speaker 5: I mean, the simple answer is yes. The complex answer
Speaker 5: is hard.
Speaker 3: Does that happen?
Speaker 9: Let's just be real here. There's no actual reason to
Speaker 9: allow the merger. It doesn't have to happen. Unlike team
Speaker 9: sports such as football or baseball, golf is actually a
Speaker 9: sportive individuals, and it doesn't actually require leagues.
Speaker 7: It's more like boxing.
Speaker 9: You can have boxing matches without having boxing leagues. You
Speaker 9: can have lots of different types of tournaments. You don't
Speaker 9: need just one league for golf. In fact, that's what
Speaker 9: a bunch of the anti trust complaints and investigations have
Speaker 9: been about from the nineties to today. Now, obviously the
Speaker 9: PGA Tour and Saudi leaders understand at some level these
Speaker 9: legal and operational realities. The people who run the PIF
Speaker 9: are sophisticated. Sow's the PGA Tour. So what's really going on? Well, honestly,
Speaker 9: I don't quite know. One possibility is that the Saudi government,
Speaker 9: which funded live golf through its sovereign Wealth Fund, is
Speaker 9: trying to avoid embarrassment. In February, a court ruled that
Speaker 9: the Saudis had to make their emails public in their
Speaker 9: antitrust suit with the PGA Tour. They claimed, Oh, we're
Speaker 9: a government, we don't have to do that. We're not
Speaker 9: like a regular company. Governments do have what's called sovereign immunity.
Speaker 9: But a judge said, look, you have sovereign immunity when
Speaker 9: it's government business. But you guys are running a golf league.
Speaker 9: That's like you're more like a corporation. So yeah, you
Speaker 9: have to tell us what's going on. You have to
Speaker 9: give us your emails, and the Saudis don't want that.
Speaker 9: Neither's the PGA Tour, but they knew it was going
Speaker 9: to happen that the Saudis didn't. So one thing that's
Speaker 9: going on here is that their ending all litigation between
Speaker 9: Live Golf and the PGA Tour, and the Saudi emails
Speaker 9: will remain private. It's true that there could be a
Speaker 9: merger challenge and so bad emails could come out even
Speaker 9: if they try to bring this merger to a completion.
Speaker 9: But a more likely path is that the Anti Trust
Speaker 9: Division at the Department of Justice investigates the deal, the
Speaker 9: Saudis drop their merger attempt before the trial, and Live.
Speaker 7: Golf shuts down.
Speaker 9: There could be some sort of Saudi investment in the
Speaker 9: PGA Tour later. Meanwhile, everyone gets the headlines now, which
Speaker 9: obscures the reality that the Saudis don't want emails made
Speaker 9: public and they can blame the Anti Trust Division for
Speaker 9: the collapse of Live Golf, even though what's really going
Speaker 9: on is Live Golf was never profitable in the first place. Iterrate,
Speaker 9: something weird is going on here, and if the deal
Speaker 9: goes through, which I don't think it will, it's likely
Speaker 9: because of high level political decision from the Bidy administration,
Speaker 9: the EU and the British government to move it through
Speaker 9: as a favor to the Saudis.
Speaker 7: I don't think that's going to happen. It's easier just let.
Speaker 9: Live Golf die and then have the Sadis make a separate,
Speaker 9: unrelated investment in a few years, or really not even
Speaker 9: do that.
Speaker 7: There are a lot of other possibilities.
Speaker 9: Maybe they'll find a way to do some sort of
Speaker 9: investment or change the terms to make the deal palatable,
Speaker 9: though honestly I can't see how they do that and
Speaker 9: make it legal. But when you're dealing with Saudi Arabia,
Speaker 9: Donald Trump Global, you can get to things like money laundering,
Speaker 9: arms dealing, espionage, weird diplomacy, and all sorts of other
Speaker 9: conspiratorial stuff.
Speaker 7: And I don't like speculating on that.
Speaker 9: Because it's like seeing ripples on an ocean and trying
Speaker 9: to guess what's happening beneath. But one thing I can
Speaker 9: say is that this deal in its current form doesn't
Speaker 9: make any sense, and that's starting to become clear. Thanks
Speaker 9: for watching this big breakdown on the Breaking Points channel.
Speaker 9: If you'd like to know more about big business and
Speaker 9: how our economy really works, you can sign up in
Speaker 9: the in the description below for my market power focused newsletter.
Speaker 7: Big thanks and have a good one.