Speaker 1: Hey, guys, ready or not, twenty twenty four is here
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Speaker 3: Good morning, everybody, Happy Thursday. We have an amazing show
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Speaker 1: What do we have, Crystal, Indeed, we do lots to
Speaker 1: get to you this morning. We have the latest fallout
Speaker 1: over that alleged strike on the Kremlin. Will tell you
Speaker 1: what we know about all of that. We also have
Speaker 1: another bank that may be teetering on the brink of failure.
Speaker 1: This comes as the Fed hikes interest rate rates yet
Speaker 1: again and we face down the dead ceiling deadlines. So
Speaker 1: there's a lot going on in terms of the economy.
Speaker 1: We have new details about exactly who Jeffrey Epstein was
Speaker 1: hanging out with and how often. Larry Summers I have
Speaker 1: some questions for you, and a new effort by our
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Speaker 1: being right wing. You're gonna love this one. You're gonna
Speaker 1: love this one. Also excited to talk to you be
Speaker 1: Ben Smith in the show. He has a new book
Speaker 1: out and he's talking about you know, he was with BuzzFeed.
Speaker 1: BuzzFeed obviously has gone under. He was part of that
Speaker 1: whole twenty tens media build up. Very insightful guy. He's
Speaker 1: got his own new media company now, so I want
Speaker 1: to hear from him about the failures there, lessons learned,
Speaker 1: how we can keep from you know, any cautionary tales
Speaker 1: that we should learn from there.
Speaker 3: That's right.
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Speaker 2: we will be talking to Ben Smith about. Yes, yeah, indeed,
Speaker 2: all right, let's start off with Ukraine. So obviously Emily
Speaker 2: and Ryan did a great job yesterday of talking about
Speaker 2: what was going on in the alleged attack on the Kremlin,
Speaker 2: potentially an assassination attempt, that's what the Russians are claiming
Speaker 2: by the Ukrainian intelligence services on Vladimir Putin's life. Well,
Speaker 2: in terms of what we know about both reaction by
Speaker 2: the Russians and then the initial denials by the Ukrainians,
Speaker 2: here's what we have so far. President Zelenski of Ukraine
Speaker 2: was actually in Finland when the attack happened, and he
Speaker 2: addressed the allegation on camera in English.
Speaker 3: Here's what he had to say.
Speaker 4: We don't attack Putchin or Moscow. We find on our territory,
Speaker 4: we're defending our religious insidd we don't have you know,
Speaker 4: enough weapon for these That's why we don't use.
Speaker 3: It anywhere for us. That is the deficit.
Speaker 4: We con'tpand it and we didn't attack Putin.
Speaker 5: We leave it to tribunal.
Speaker 2: Just gonna say, I would say it begs belief just
Speaker 2: because and we'll get into this in a little bit
Speaker 2: about the way that they are specifically phrasing their denials.
Speaker 2: But I think it's also just worth for anybody who's
Speaker 2: just joining us and hasn't seen the video. This is
Speaker 2: some crazy video in downtown Moscow. Let's go and put
Speaker 2: this up there on the screen. I mean, what we
Speaker 2: are watching here is this. You know, this is the
Speaker 2: heart of power inside of Russia. And you can see
Speaker 2: a drone very clearly coming and striking the flag which
Speaker 2: is on top of the domed building there. And actually
Speaker 2: whenever there's some zoomed out photos and video of this crystal,
Speaker 2: you literally watched the drone fly pass the Kremlin, the
Speaker 2: entire seat of power and all legitimacy of authority in Russia,
Speaker 2: before exploding on top of the flag. The Russians claimed
Speaker 2: that anti aircraft was used to blow up other drones
Speaker 2: that were in the area. There's again, the circumstances around
Speaker 2: all of this are unclear. I want to go back
Speaker 2: to though, the initial denial, the denial now by the
Speaker 2: Ukrainian regime. Let's go and put this up there on
Speaker 2: the screen. And this was a screenshot that was flagged
Speaker 2: by our producer. Following the news, the actual chief of
Speaker 2: staff to President Selenski actually posted three fire emojis on
Speaker 2: his telegram channel without any commentary, but then deleted the
Speaker 2: post shortly afterwards.
Speaker 1: The post is almost more of a deleting the post is.
Speaker 3: A little bit of a tell, I would say.
Speaker 2: And the other reason that I think it's so important
Speaker 2: to think about all of this is that if you
Speaker 2: read the detailed response, not just by Zelenski, but by
Speaker 2: the Chief form Policy Advisor to Ukraine, who actually put
Speaker 2: out a tweet in English, he said something which calls
Speaker 2: calls into question the entirety of the statement. He said, Crystal,
Speaker 2: we have never used drones or perpetrated any attack on
Speaker 2: Russian soil. That's why even pro Russian or pro Ukrainian
Speaker 2: accounts who I follow, people like Michael Weiss and others,
Speaker 2: are saying this is ridiculous.
Speaker 3: They're like, the idea that the Ukrainian.
Speaker 2: Intelligence services have not carried out both assassination campaigns and
Speaker 2: even air like attacks on Russian soil is ludicrous.
Speaker 3: You know Whychris.
Speaker 2: We even know from the leaked set of Pentagon documents
Speaker 2: that they not only have done so, but want to
Speaker 2: do so with long range weapons. So there's a lot
Speaker 2: if you parse the language. You know, Zelenski funnily enough
Speaker 2: is saying, oh, well, we don't.
Speaker 3: Have the weapons. First of all, you have the weapons. Second,
Speaker 3: you actually want more so you can do even more
Speaker 3: of this.
Speaker 2: And third, the idea that the Ukrainian intelligence services have
Speaker 2: not carried out multiple attacks on Russian soil throughout the
Speaker 2: course of this war is just a lie. Absolutely on
Speaker 2: its face, even the most pro Ukrainian accounts will tell
Speaker 2: you that. Now does any of this mean that they
Speaker 2: are directly responsible? Who knows a genuine who knows moment?
Speaker 2: Is it technically possible the Russians could have carried out
Speaker 2: a false flag?
Speaker 3: Maybe? I mean, let's think about it a little bit.
Speaker 3: But first though, I.
Speaker 2: Think we should note that the people who are the
Speaker 2: most pro Ukraine here in Washington all want to call
Speaker 2: it a first flag, because I think by saying that,
Speaker 2: they are explicitly acknowledging this is a dangerous escalation. One
Speaker 2: of those is the former CIA director Leon Peta, Here's
Speaker 2: what he had to say, and.
Speaker 3: Former CA Director of President under President Obama Lee Panetta.
Speaker 3: Secretary of Panetta sources.
Speaker 5: TELCNN that US officials had no warning that an attack
Speaker 5: like this was coming, and that.
Speaker 3: The Ukrainians assure them privately they had nothing to do
Speaker 3: with it.
Speaker 6: What's your take, Jake, This really does smell like a
Speaker 6: false flag operation on the part of the Russians, a diversion,
Speaker 6: if you will.
Speaker 3: So, false flag. They said, it's a diversion.
Speaker 2: I mean, again, look, anything is possible, but I think
Speaker 2: we should consider a couple of things I'm curious what
Speaker 2: you think, Crystal.
Speaker 3: Yeah.
Speaker 2: Number one is this, It's humiliating to have a drone.
Speaker 2: It's like the Chinese balloon thing. But for the Russians,
Speaker 2: you have a nation that you are at war with
Speaker 2: that is able to penetrate your most innermost defenses and
Speaker 2: strike at the seat of power in Mosk.
Speaker 3: I mean that's humiliate.
Speaker 2: That would be like if somebody, you know, blew up
Speaker 2: the statue on top of the Capitol building. That's insane, right,
Speaker 2: think about the what that response would look like and
Speaker 2: the questions it would call to the actual like command
Speaker 2: and control of the Russian regime.
Speaker 1: Yeah.
Speaker 2: Second, you know, okay, everyone's saying it's a false flag
Speaker 2: and all that, but we also, again, as I've laid out,
Speaker 2: Ukrainian intelligence services have long both wanted the weapons to
Speaker 2: carry out attacks like this, have you know, justified this
Speaker 2: and also are you know, we're obviously gleeful as we
Speaker 2: initially showed you in that So I just think much
Speaker 2: of the false flag discourse is centered around the fact
Speaker 2: that the true here's the basic truth. Whatever you think
Speaker 2: this is definitely ratcheting things up a notch well.
Speaker 1: And whatever you think, it's definitely in the realm of possibility.
Speaker 1: I mean, even the biggest Ukraine stands who want to
Speaker 1: believe Panetta that, oh, that has all the hallmarks of
Speaker 1: Russian disinformation and a false flag in the infamous words
Speaker 1: where it used to dismiss the Hunter Biden laptop story.
Speaker 1: Even if you want to believe that, you have to
Speaker 1: acknowledge the Ukrainians have done some crazy crap already, and
Speaker 1: they've done it on Russians, and you also have to acknowledge, Yeah,
Speaker 1: the Russians are liars. So are the Ukrainians. I mean,
Speaker 1: we know this and look he to battle heat a war.
Speaker 1: I get it. Okay, maybe you can make some excuses
Speaker 1: for them, but you cannot rely on the word of Zelenski,
Speaker 1: whether or not anyone in the Ukrainian State, Ukrainian Rotary
Speaker 1: Club or whatever had to do with this attack. I
Speaker 1: think your point about you know, it's hard to imagine
Speaker 1: that this would be the type of false flag that
Speaker 1: they would want to stage, given that also throughout this
Speaker 1: war it's really been putin has really attempted to sort
Speaker 1: of protect the population from the fallout of the war
Speaker 1: and not make it feel like this is on their soil.
Speaker 1: And this is coming for them directly in order to
Speaker 1: try to maintain support for the war efforts. So you know,
Speaker 1: it flies in the face of that as well. But
Speaker 1: just think about it. I mean, we had we know
Speaker 1: two very very likely that Ukrainians were involved in two
Speaker 1: separate assassinations on Russian soil with pro Russian war bloggers. Effectively,
Speaker 1: we know that they were very likely involved in the
Speaker 1: Crimean Bridge. We still don't really know exactly what happened
Speaker 1: with Nordstream. They may have been involved and may have
Speaker 1: been us on our own, etc. But it's not crazy
Speaker 1: to think that they were involved in blowing that up
Speaker 1: as well. We know from the leaked documents that they
Speaker 1: were very interested in obtaining long range missiles from US
Speaker 1: so that they could strike further onto Russian soil. So
Speaker 1: to act like, oh, there's no way this could be them,
Speaker 1: I think that that is incredibly, incredibly naive. I think
Speaker 1: it is wilfully blind, and it frankly irritates me that
Speaker 1: the media is not more clear about these things because
Speaker 1: you have so much of the population that they just
Speaker 1: see Zelenski as a hero and they just dismiss it
Speaker 1: out of hand. There's no way possible that he could
Speaker 1: have done this. Think about the incentive that they have
Speaker 1: here too, which is something that we have always flagged
Speaker 1: as a real danger. It is in the Ukrainian's interest
Speaker 1: to have an escalation that would draw us directly into
Speaker 1: the conflict. So when we look at something like this
Speaker 1: and we're like, this is insane. You're trying to potentially
Speaker 1: assassinate the leader of a nuclear arm superpower, Like, what
Speaker 1: in the world are you up to? But their calculus
Speaker 1: is very different. Their interests are not, in this way
Speaker 1: actually aligned with us. They would like to see some
Speaker 1: sort of escalation that forces our hand and draws us
Speaker 1: directly into this war because frankly, that is the only
Speaker 1: way that they would outright win. So that has always
Speaker 1: been there. But I just really want to urge people
Speaker 1: to think about how much fire we are playing with here,
Speaker 1: because even if you submit, there was like a one
Speaker 1: percent chance that this was the Ukrainians. You have to
Speaker 1: these are our partners and allies. They did not warn us,
Speaker 1: probably in advance that they were going to do this.
Speaker 1: We have no control over them, and we also know
Speaker 1: from the late documents them from a lot of other reporting,
Speaker 1: we have less insight in some ways into what the
Speaker 1: Ukrainians are up to. Because we don't have these deep
Speaker 1: intelligence networks that we've been working on for decades with
Speaker 1: regard to your Ukrainians, and they don't let us in
Speaker 1: on what they're up to. We have less insight into
Speaker 1: their operations in some ways than the Russians. So we
Speaker 1: are playing with fire. This is an insane situation, and
Speaker 1: it just reminds me again, whatever we can do to
Speaker 1: get this conflict to an end is incredibly critical.
Speaker 3: This is the issue. You know, the NAFO people who
Speaker 3: are out there are all.
Speaker 2: Like, well, the Moscow has tried to assassinate Zelensky, who's
Speaker 2: defending Moscow? Okay, right, if the Ukraine listen, here's my
Speaker 2: general take on the matter. People dismiss any concern of
Speaker 2: ours as some sort of condemnation on Ukraine. Now here's
Speaker 2: the deal. If Ukraine wants to put itself in a
Speaker 2: position to risk its annihilation.
Speaker 3: They are free to do that.
Speaker 2: But then it should said risk happen, They should bear
Speaker 2: one hundred percent of the risk and of the possibility
Speaker 2: without any of the escalation coming back on us. And
Speaker 2: that's part of why I'm so annoyed by the discourse
Speaker 2: around this, he's saying that Ukraine is quote unquote not
Speaker 2: justified or doesn't have the right to retaliate. You can
Speaker 2: do whatever you want, but whatever you want, you should
Speaker 2: keep us out of it. And that's the problem, which
Speaker 2: is that they don't seem to understand we are tied.
Speaker 3: At the hip.
Speaker 2: Not my choice, I can tell you that, but by
Speaker 2: the choice though of the President of the United States,
Speaker 2: of NATO and the entire Western Alliance seems to have
Speaker 2: lost their minds, and they seem to think that, you know,
Speaker 2: we are going to rise and fall with whatever.
Speaker 3: Happens to Ukraine.
Speaker 2: And if that's the case, then then of course, as
Speaker 2: you said, Ukraine is of their fate, and what happens
Speaker 2: to them is now directly tied to us, and so
Speaker 2: we should have some say in the matter.
Speaker 1: When you're dealing with nuke's, what's going on here is
Speaker 1: tied to everyone on the planet, right, I mean, even
Speaker 1: if we weren't so directly involved and basically a proxy
Speaker 1: you know, fighters alongside of the Ukrainians, with by the way,
Speaker 1: some limited number of boots on the ground and providing
Speaker 1: a lot of intelligence to help them with their targeting
Speaker 1: and all of those, and of course the money and
Speaker 1: the weapons and all that we have sent over there.
Speaker 1: Even if that wasn't the case, every single person on
Speaker 1: the planet should be concerned about what's going on here.
Speaker 3: Sure.
Speaker 2: And then also this is another important thing. And by
Speaker 2: the way, this is coming from Bellincat, which is definitely
Speaker 2: one of the more of a pro Ukrainian group. I
Speaker 2: think it'd be fair to say, put us up there
Speaker 2: on the screen. They are acknowledging that there are apparent
Speaker 2: Russian Ukrainian attacks within Russia and Russian controlled territory over
Speaker 2: the last four days, all using drones. There was a
Speaker 2: drone attack on a huge fuel storage facility in Crimea.
Speaker 2: There was a drone attack on an oil depot near.
Speaker 3: The Kirch Bridge.
Speaker 2: There was a two major train derailments in a region
Speaker 2: inside of this territory. And there also now is the
Speaker 2: drone attack at the Kremlin. Lots of people kept saying, oh, well,
Speaker 2: this is an isolated incident. No, it was part of
Speaker 2: a concerted Ukrainian drone campaign against targets inside of Russia.
Speaker 2: Now once again they can do what they would like,
Speaker 2: but if they get retaliated against and they get a
Speaker 2: city wiped out or something like that. Well, then that's
Speaker 2: on them, because that's what war looks like. And then
Speaker 2: the idea that we should get drawn into it even more,
Speaker 2: which is what a lot of people hear and Washington want,
Speaker 2: I think is very problematic. I just you know, for me,
Speaker 2: the fact that so many people want to call it
Speaker 2: a false flag is the tell in and of itself,
Speaker 2: because they have to because by doing that they can
Speaker 2: push responsibility off the Ukrainians because if we all acknowledge
Speaker 2: it is look, let's just say it's probably almost certainly
Speaker 2: it was the Ukrainian regime, Well, then they have to
Speaker 2: acknowledge them that they've done something incredibly risky.
Speaker 1: I also want you to think about, you know, with
Speaker 1: Panetta there on with Jake Tapper, Now, if you ever
Speaker 1: had anyone with a critical view as we do, or
Speaker 1: a skeptical view as we do, go on and say,
Speaker 1: you know, this really looks like a Ukrainian attack. Oh,
Speaker 1: they be up at arms. There's no way you could
Speaker 1: just say that without tap or jumping in impress, which
Speaker 1: you know what he should, right, but you got to
Speaker 1: do it on the other side too, And Panetta is
Speaker 1: just allowed to float this with no backing, no evidence,
Speaker 1: no nothing, just because he wants it to be true,
Speaker 1: and no pushback. For the media, this becomes the accepted narrative. Also,
Speaker 1: to linger on that tweet that we put up earlier
Speaker 1: showing the various drone attacks in and around Russia from Ukrainians,
Speaker 1: that also really undermines Zelensky's claim that we don't even
Speaker 1: have the weapons.
Speaker 3: Toe That's what I'm saying.
Speaker 1: So, if your statement of denial really doesn't hold up
Speaker 1: to scrutiny, that should cause people to have a lot
Speaker 1: of question marks about what else you're presenting here and
Speaker 1: whether it is in fact accurate or not. Again, let
Speaker 1: me just say, if you are more inclined than we
Speaker 1: are to believe Zelensky's denials and believe this was a
Speaker 1: potential false flag, please acknowledge there is at least a
Speaker 1: chance that this was the Ukrainians, and if there's even
Speaker 1: a chance that they are freelancing and engaging this type
Speaker 1: of incredibly reckless actions, that should change your whole way
Speaker 1: that you're thinking about this war.
Speaker 3: Yeah.
Speaker 2: Absolutely, Let's go to the next part here about Yeah,
Speaker 2: how are the Russians taking this? Turns out not? Well,
Speaker 2: let's go and put this up there on the screen.
Speaker 2: Dmitriy Medvedev, the former president of Russia, says, after the
Speaker 2: attack on the Kremlin, there is a need to now
Speaker 2: quote physically eliminate Zelensky. He says, after today's terrorist attack,
Speaker 2: there are no options left other than the physical elimination
Speaker 2: of Zelensky and his clique. He is not even needed
Speaker 2: to sign the Act of Unconditional Capitulation. Hitler, as you know,
Speaker 2: did not sign it either. There will always be some
Speaker 2: kind of changer like this, Hits President. Admiral Donuts, wrote
Speaker 2: Medvedev in his telegram channel.
Speaker 3: And by the way, Medvedev, remember.
Speaker 2: Was supposed to be the reasonable one whenever Putin was out. Now, look,
Speaker 2: he's basically lost it in terms of his rhetoric now
Speaker 2: for quite some time. But really his designs and his
Speaker 2: rhetoric and all that are aimed not just at Zelenski,
Speaker 2: they're really aimed at us. Just to show you what
Speaker 2: the temperature is inside of the Moscow elite, let's go
Speaker 2: to the next one. Here up on the screen, the
Speaker 2: speaker of the Duma, you know, basically the Russian Congress,
Speaker 2: says that Russia should use quote weapons to destroy the
Speaker 2: KEIV regime. As Samuel Romani here says, aside from nuke's
Speaker 2: what are said weapons exactly right? Which is you know
Speaker 2: what exactly is on the table? Well, now, listen, nuclear
Speaker 2: saber rattling has long been part of the Russian rhetorical campaign.
Speaker 2: Obviously they can credibly back it up because they have
Speaker 2: more nukes than everybody else on the planet. But you
Speaker 2: should also pair it with some recent news which was
Speaker 2: passed off as some sort of secondary thing, but is
Speaker 2: pretty alarming.
Speaker 3: Let's put this up there on the screen.
Speaker 2: The Federal National National Security and Nuclear National Security Administration
Speaker 2: here in the US is now setting up an advanced
Speaker 2: network across Ukraine with radiation sensors to detect a nuclear
Speaker 2: blast that could verify an attacker's identity. Again, this is
Speaker 2: US tax pay dollars in a US agency that is
Speaker 2: now wiring up Ukraine with the same sensors and unit
Speaker 2: of atomic experts that are monitoring all of this equipment,
Speaker 2: with the same radiation sensors that we have here at home.
Speaker 3: Now, we don't know all.
Speaker 2: Their allies that have said sensors and have the same network,
Speaker 2: but I do think at the very least it seems
Speaker 2: important to say, you don't do this unless you think
Speaker 2: that the chance is greater than one percent. And as
Speaker 2: all policy makers have always made around nuclear policy, the
Speaker 2: policy of one percent, because the risk is so catastrophic
Speaker 2: that you have to take it and treat it almost
Speaker 2: as if it's on the table as fifty to fifty.
Speaker 1: Yeah, yeah, I think that's right. And this is in
Speaker 1: direct contrast. We've been receiving assurances in the media and
Speaker 1: from administration officials for a while now of like, oh,
Speaker 1: we don't think that's going to happen. We don't think
Speaker 1: there's going to be any nuclear deployment. There was some
Speaker 1: increased concern a while ago, but we really don't think
Speaker 1: Putin's going to go in that direction. I think this
Speaker 1: action speaks louder than those words, is what I would say. Clearly,
Speaker 1: they do think that there is some level of significant
Speaker 1: risk that Putin does introduce nukes into this conflict. I
Speaker 1: don't have to tell you how terrifying that potential scenario is.
Speaker 1: They also talk in this article about how they feel
Speaker 1: fear a potential reactor threat scenario. They have a nuclear
Speaker 1: power expert who says that Russia, if it suffered a
Speaker 1: humiliating defeat and withdrew from Ukraine might retaliate by firing
Speaker 1: on a reactor it's spent fuel storage areas in order
Speaker 1: to release high radioactivity into the environment. That's one of
Speaker 1: the biggest dangers. This doctor Lyman his name said, if
Speaker 1: they wanted to render as much of the countryside as
Speaker 1: they could uninhabitable, those reactors might become targets. So that's
Speaker 1: another potential threat that they're monitoring here as well. It's
Speaker 1: also interesting the way they talked about this agency outfit
Speaker 1: group within the Energy Department that they describe as a
Speaker 1: shadowy unit of atomic experts that apparently they didn't even
Speaker 1: want to acknowledge the existence of until very recently. So anyway,
Speaker 1: there's that too.
Speaker 2: Yeah, great, And by the way, what's opening on top
Speaker 2: of all of that after the attack put this up
Speaker 2: there on the screen. The US is sending a Ukraine
Speaker 2: three hundred million dollars more in additional military aid, including
Speaker 2: an enormous amount of artillery rounds, howitzers, air to ground
Speaker 2: rockets ammunition as the launch of the Spring offensive against
Speaker 2: the Russian forces approaches. The new package also includes hydro
Speaker 2: seventy rockets unguided rockets that are fired from an aircraft.
Speaker 2: It includes an undisclosed number of rockets for high mars, mortars,
Speaker 2: howitz surrounds, missiles, anti tank rifles. The weapons all will
Speaker 2: be pulled from existing Pentagon stocks so that it can
Speaker 2: go quickly to the front line in case you're wondering
Speaker 2: where it's all coming from, which is our own stocks
Speaker 2: of military resources, of which we are going to probably
Speaker 2: take a decade to have to replace. I encourage everybody
Speaker 2: to go read. You know, might probably do a monologue
Speaker 2: on this soon. The level of how much this is exposed,
Speaker 2: how hollow and useless are defense industrial complex is. For
Speaker 2: all of the talk of the military industrial complex, I
Speaker 2: always try and emphasize this point.
Speaker 3: They're not even good at what they do.
Speaker 2: We have like one plant that produces weapons waste, and
Speaker 2: then we just had a.
Speaker 1: Fighting amount of money.
Speaker 3: Yeah, and you're like, what are we paying for?
Speaker 2: You know, we pay the size of the GDP of
Speaker 2: small African nations on a yearly basis, and we don't
Speaker 2: even have enough weapons to send to a measly country
Speaker 2: like Ukraine, let alone, you know, defend the United States
Speaker 2: of America. That's a whole other subject for another time.
Speaker 2: The point is, though, is that it is a zero
Speaker 2: sum game and we are not. Basically, we don't have
Speaker 2: a resources that we necessarily could need. And I think
Speaker 2: also at this point we should all acknowledge the coming
Speaker 2: Ukrainian Spring offensive. It's happening at some point. We don't
Speaker 2: know when it could happen.
Speaker 3: Literally today, it could have already begun, you know, with
Speaker 3: the drone campaign.
Speaker 2: It could happen in a week. America doesn't even know.
Speaker 2: Our own intelligence services don't know this. Zelenski doesn't want
Speaker 2: to tell us apparently, and I guess in some way
Speaker 2: you can sympathize he's like, well, you know, we didn't
Speaker 2: even know about these League documents, Like why should we
Speaker 2: tell you anything?
Speaker 1: Is it is gonna end up in the press now,
Speaker 1: I don't blame him us, yeah, right right. I mean,
Speaker 1: we have a lot of strategic leverage here that we
Speaker 1: could be using if it was important to us to
Speaker 1: know what the hell they were up to. But you know,
Speaker 1: apparently it's not that important to our our leaders and
Speaker 1: the peace you're pointing out saga with regards to the
Speaker 1: military industrial complex. This is why actually some of the
Speaker 1: voices of restraint have come from the Pentagon. I mean,
Speaker 1: think about General Bully, because they're very aware of what
Speaker 1: this does to our own readiness and preparedness. The last
Speaker 1: thing I want to say with regard to the Russian
Speaker 1: response here is listen, if Putin was killed, died, sassinated, whatever,
Speaker 1: It's not like we would be shedding tears here. However,
Speaker 1: I think we have a realistic, realistic understanding, and no
Speaker 1: one needs to confuse themselves about the fact that it's
Speaker 1: not going to be doves that come to power in
Speaker 1: the wake of that death. The ascendant voices within Russia
Speaker 1: are harder line, if anything, then Putin. They are more
Speaker 1: pro war, they are more aggressive, more brutal. And I
Speaker 1: know you may think that that's not possible, but believe me,
Speaker 1: it is. So don't think that if Putin was gone
Speaker 1: or taken out, that this would be an improvement in
Speaker 1: the city situation. It could actually make things much worse.
Speaker 1: And you know, as we've said before, the biggest risk
Speaker 1: in terms of nuclear usage deployment is if Russia is
Speaker 1: truly desperate, truly backed into a corner. And I think
Speaker 1: that this incident, whether you think it's you know, most
Speaker 1: likely that it was the Ukrainians or only possible that
Speaker 1: it was the Ukrainians. It should really bring home to
Speaker 1: you the grave risks that are a tendant to continuing
Speaker 1: this conflict and allowing it to go on as we have.
Speaker 2: Yeah, I mean, we just read that thing about Medvedev,
Speaker 2: like that's the moderate guy you know inside of Russia
Speaker 2: or the do must be these are established politicians who
Speaker 2: are the real alternatives to putin people. Always I've heard,
Speaker 2: always heard that with the Chinese Communist Party too. They're like,
Speaker 2: who knows what the hell would come next? You have
Speaker 2: no idea like that level of authoritarianism could could actually,
Speaker 2: you know, look like child's play compared to what some
Speaker 2: facets within the party or the military or whatever do desire.
Speaker 2: Not everybody's like us, you know, and our system. That's
Speaker 2: a lesson that I think a lot of people should remember.
Speaker 2: Let's go ahead to the next one with the economy.
Speaker 1: Yeah, so we've got kind of a lightning round of
Speaker 1: big economic news that is all coming together this week
Speaker 1: that should similarly make you pretty nervous. So we told
Speaker 1: you earlier this week on Monday, we have the second
Speaker 1: largest bank failure in history, and now it looks like
Speaker 1: We've got yet another bank, this would be the fourth
Speaker 1: one in just a few months that is teetering on
Speaker 1: the brink. Let's put this up on the screen from CNBC.
Speaker 1: We're talking about pac West here. This is a report
Speaker 1: from yesterday. Their shares fell more than fifty percent after
Speaker 1: hours on a report that the bank is considering quote
Speaker 1: strategic options. That means again it is teetering on the brink.
Speaker 1: I'll read you a little bit of this report. The
Speaker 1: regional bank is assubsing options, including a possible sale, bringing
Speaker 1: in advisors to evaluate longer term plans for the business,
Speaker 1: according to one person familiar with the matter. They later
Speaker 1: confirmed they were still in discussions with momultiple potential investors
Speaker 1: and partners of the company will continue to evaluate all
Speaker 1: options to maximize shareholder value and the all regional bank
Speaker 1: shares have basically been hit hard recently after the collapse
Speaker 1: of Silicon Valley Bank, and PacWest has not been immune
Speaker 1: to that. Just to give you a sense of the
Speaker 1: size of this, this is an LA based bank that
Speaker 1: has a roughly seven hundred and fifty million dollar market cap,
Speaker 1: so it's no small potatoes and it's down by seventy
Speaker 1: two percent this year through Wednesday, so has just been battered. Now.
Speaker 1: I will tell you this morning, what they're saying, the
Speaker 1: folks at pack West is that core deposits have actually
Speaker 1: increased since March. According to them, in the wake of
Speaker 1: the Silicon Valley bank collapse, because that's been a major
Speaker 1: issue for some of these regional banks is depositors have
Speaker 1: fled to the big boys like JP Morgan Chase, But
Speaker 1: they say that hasn't been the case for them. They
Speaker 1: did confirm their inn talks with several potential investors seeking
Speaker 1: a call markets after a sixty percent stock route. That
Speaker 1: made it the new focal point of concern over the
Speaker 1: health of US regional lenders. So earlier in the week,
Speaker 1: the message that was coming out from IRO was like this,
Speaker 1: these are just one off situations. There's no contagion. I
Speaker 1: think this shows you that there is a lot more
Speaker 1: fragility throughout the sector. Then maybe they want to admit.
Speaker 2: Yeah, they are really not telling us, you know, the
Speaker 2: full thing of what's going on. I actually read with
Speaker 2: interest tweet by Bill Ackman, the billionaire investor. I mean, look,
Speaker 2: he's talking about the financial system, so maybe's talking about
Speaker 2: something that he was talking about and I actually.
Speaker 3: Thought it was worth reading.
Speaker 2: He says that the regional banking system is at risk
Speaker 2: SVB depositors. Bad weekend woke up uninsured depositors everywhere. The
Speaker 2: rapid rising rates impaired assets and drained deposits, zeroing out
Speaker 2: shareholders and bondholders massively increases bank's cost of capital. The
Speaker 2: FDIC's failure to update and expand insurance regime is hammering
Speaker 2: more nails in the coffin. First Republic Bank would not
Speaker 2: have failed if the FDIC had temporary guaranteed deposits with
Speaker 2: a new guarantee regime was created. Instead, we are watching
Speaker 2: Domino's fall as great systemic and economic costs. Banking is
Speaker 2: all a confidence game. At this rate, no regional bank
Speaker 2: can survive bad news or bad data, as a stock
Speaker 2: price plunge will inevitably follow. Ensured and unsure deposits are
Speaker 2: withdrawn and quote pursuing strategic alternatives just means an FDI
Speaker 2: shutdown over the coming weekend. There is no incentive to
Speaker 2: bid until Sunday.
Speaker 3: After the failure. So look he's talking there.
Speaker 2: You know he wants a better insurance regime, which I
Speaker 2: do think probably should be on the table just one
Speaker 2: that doesn't, you know, come at the cost of increasing
Speaker 2: our fees. But I thought it was actually well said
Speaker 2: in terms of how the game is structured around how
Speaker 2: these weaker regional banks you're dead in the water now
Speaker 2: at this point.
Speaker 3: You know, all it really.
Speaker 2: Takes is because confidence is so shaken at this point
Speaker 2: for these regionals. It only takes one piece of bad
Speaker 2: news that you might have been able to weather in
Speaker 2: the past, and you can just collapse.
Speaker 1: Yeah, that's right, right, that's right. And the reason why
Speaker 1: this bank in particular is vulnerable is because of where
Speaker 1: it's located and what its client basis, so similar depositor
Speaker 1: base as we saw with First Republic, as we saw
Speaker 1: with Silicon Valley Bank, And so that's why investors and
Speaker 1: others are looking at this one going, h are you
Speaker 1: all going to be okay? This does not look particularly good.
Speaker 1: So I think the FDIC point is really important. We
Speaker 1: covered earlier in the week how they just put out
Speaker 1: a report of their recommendations of how to change the
Speaker 1: deposit insurance system. I think that's important. I think it's
Speaker 1: important we deal with that quickly so that at the
Speaker 1: very least there is some certainty because That's one of
Speaker 1: the things that was so unnerving after the response to
Speaker 1: Silicon Valley Bank is we were, you know, reporters were
Speaker 1: asking questions of Janet Yellen and others like, okay, so
Speaker 1: does this mean that effectively all deposits are insured in
Speaker 1: the entire system, and like what does that mean in
Speaker 1: terms of who's backstopping that? And how's that going to
Speaker 1: all work out? And they really hedged, you know, she
Speaker 1: gave a different answer than Jerome Pale gave. It seemed
Speaker 1: like they were not on the same page. What's the web?
Speaker 1: So if anything, whatever the ultimate regime is going to be,
Speaker 1: they need to figure it out. They need to make
Speaker 1: it really clear. And too, by the way, they got
Speaker 1: to stick to it as well. You can't have it
Speaker 1: then be Lucy goosey and all right, we're going to
Speaker 1: take it on a case by case basis, because then
Speaker 1: you end up with, you know, you end up with
Speaker 1: a lot of moral hazard. You end up with some
Speaker 1: people being treated, usually you know, wealthy depositors being treated
Speaker 1: in a way that is kind of unfair. So anyway,
Speaker 1: that's incredibly important. The other piece of this that Acman
Speaker 1: is very obvious to a lot of folks. Is part
Speaker 1: of what has pushed these banks off the cliff has
Speaker 1: been the FEDS program of aggressive interest rate hikes. And
Speaker 1: let's put this next piece up on the screen. They
Speaker 1: have decided they are going to continue in that direction.
Speaker 1: They just increased rates another quarter point. But they did
Speaker 1: signal a potential end to the hikes. I think it
Speaker 1: is a major question mark where things go from here,
Speaker 1: whether they continue the interest rate hikes or whether they
Speaker 1: press pause. Powell made it very clear they have no
Speaker 1: intention of cutting rates at this point. This was a
Speaker 1: widely expected decision. Nevertheless, this pushes the FED funds rate
Speaker 1: to the highest level since August of two thousand and seven.
Speaker 1: So it gives you a sense of how extraordinary this
Speaker 1: path of interest rate hikes has been. Just to give
Speaker 1: you a little bit of the Fed speak here of
Speaker 1: how they altered this particular statement versus the last one
Speaker 1: that is making people feel like, okay, this might be
Speaker 1: the end of the rate hikes at least for a while.
Speaker 1: They omitted a sentence that was present in their March
Speaker 1: comments saying that quote, the Committee anticipates that some additional
Speaker 1: policy firming may be appropriate for the Fed to achieve
Speaker 1: its two percent inflation goal, So they took that line out.
Speaker 1: People took that as all of these statements, just so
Speaker 1: you know, are really carefully worded and parsed, etc. So
Speaker 1: they were taking that removal of that statement as significant
Speaker 1: in an indicator that perhaps this might be the last
Speaker 1: rate hike. This decision to hike rates by a quarter
Speaker 1: point was unanimous, which is also really noteworthy. The post
Speaker 1: meaning statement also noted that tighter credit conditions for households
Speaker 1: and businesses are likely to weigh on economic activity, hiring,
Speaker 1: and inflation. Now, they did have something similar to that
Speaker 1: language in the March statement as well, but basically you
Speaker 1: could look at this as them saying, you know, we
Speaker 1: don't potentially we don't need to hike rates anymore because
Speaker 1: we already have this gigantic weight on the economy that
Speaker 1: is probably going to pull inflation down. And you know,
Speaker 1: they have been warning as well, even the fed's own
Speaker 1: economists have been warning that we are likely to see
Speaker 1: some sort of a recession due to these rate hikes
Speaker 1: and the banking issues that have resulted.
Speaker 3: It's really important.
Speaker 2: Let's go and put this next one up there on
Speaker 2: the screen too, just to hammer home, like why it
Speaker 2: all matters for you, which is this massively increases all
Speaker 2: of the interest rates on credit cards. Currently, the credit
Speaker 2: card interest rate average is twenty percent as of April
Speaker 2: twenty six. That is up from sixteen percent just March
Speaker 2: of last year. Car Loans currently are at one of
Speaker 2: the highest levels in modern history. The average interest right
Speaker 2: now on a car loan is seven percent in March.
Speaker 2: It's at least one point from just six months earlier,
Speaker 2: and obviously a lot more than where things were just
Speaker 2: a couple of years ago. Student loan rates obviously variable
Speaker 2: student loan rates, it's killing a lot of people. Currently,
Speaker 2: borrows with a federal undergraduate loan dispersed after July one
Speaker 2: are now paying five percent interests.
Speaker 3: A year earlier it was at three point seven.
Speaker 2: Obviously, every even one point on that is thousands of
Speaker 2: dollars on the average balance for people. And then mortgage
Speaker 2: is one where it really is just murdering people. So
Speaker 2: actually I'm looking at a graph from Politico that just
Speaker 2: came out this morning. The average monthly mortgage payment for
Speaker 2: a typical US home has grown fifty percent since January
Speaker 2: thirty first, twenty twenty two. Currently, as it stands, home
Speaker 2: with a five percent down payment at a thirty fixed
Speaker 2: year rate is at two two hundred and thirty seven dollars.
Speaker 2: In January of twenty twenty two, it was fifteen hundred bucks.
Speaker 2: So I mean that's a ton of money. That's what
Speaker 2: twenty four thousand dollars extra per year with the vast
Speaker 2: majority of it going to interest. So you're not even
Speaker 2: touching your principle now personally only with the you know,
Speaker 2: five percent down is pretty risky, you know, just in
Speaker 2: general terms.
Speaker 3: Of putting stuff down.
Speaker 2: But we got to be real about where things are
Speaker 2: with our current financial picture for most Americans, and you're
Speaker 2: just getting the rawest deal because the real estate market
Speaker 2: has basically gone flat. It hasn't gone down right like
Speaker 2: some places. It's gone down, but instead of growing thirteen
Speaker 2: percent or whatever year over year, it just hasn't grown
Speaker 2: by any percent. But that doesn't mean that the price
Speaker 2: isn't still crazy out of reach, and you have a
Speaker 2: fifty percent increase in your overall mortgage payment, like you're
Speaker 2: paying a ton more money for basically the same house. Yeah,
Speaker 2: and the crash that everybody wanted it just didn't happen.
Speaker 2: And the reason it didn't happen is because basic supply
Speaker 2: and demand, we just don't have enough housing for most
Speaker 2: For people who want to buy a house air go,
Speaker 2: the price is sky high.
Speaker 1: Yeah, And one rates are high. That means that there's
Speaker 1: a dis incentive also to build additional housing stock, which
Speaker 1: is so I mean, especially in a nation that has
Speaker 1: as much debt as we do. The fact credit card
Speaker 1: interest rates are up, new car loan rates are up,
Speaker 1: student loan debt rates are up, I mean, mortgage rates
Speaker 1: obviously up. All of these pieces really adds up to
Speaker 1: an affordability crisis across America. And then you add to
Speaker 1: that the fact that inflation has slowed somewhat but is
Speaker 1: still a significant problem. I also just want to underscore
Speaker 1: something that I talked about my monologue earlier this week,
Speaker 1: which is that the commercial real estate market is something
Speaker 1: we really have to keep our eyes on in terms
Speaker 1: of bank and economic stability because you have a few
Speaker 1: things coming together. Number One, people are not working in
Speaker 1: the office the way that they used to, not anywhere
Speaker 1: close and it's not going back. So anybody who is
Speaker 1: in or around a metro area, we certainly see it
Speaker 1: here in DC. These downtowns are totally different, and there's
Speaker 1: been a lot of ideas, Okay, we should this office
Speaker 1: space to residential space to deal with the housing issue.
Speaker 1: It's not that simple. It's hard to convert them. There's
Speaker 1: zoning issues, there's all kinds of challenges there, so it's
Speaker 1: not easy to do that. Meanwhile, half of the multi
Speaker 1: trillion dollar market, half of that debt comes due in
Speaker 1: just the next two years. And guess what it's banks
Speaker 1: like pac West. I don't know specifically what their balance
Speaker 1: sheet is, so I'm not speaking specifically to them, but
Speaker 1: that type of regional, mid sized bank, they're the ones
Speaker 1: that overwhelmingly hold this type of debt. And just as
Speaker 1: your mortgage rate, you know, if you're going to try
Speaker 1: to buy a house, is going up, their rates in
Speaker 1: the commercial real estate market are also have also gone
Speaker 1: up significantly, while the value of those properties is getting
Speaker 1: crushed because there just isn't the demand for office space
Speaker 1: that there used to be. So I think that is
Speaker 1: a huge cloud looming over the market, something Charlie Mungro
Speaker 1: is worrying about that I really want to keep our
Speaker 1: eyes on, and that is obviously tied into what the
Speaker 1: FED decides to do here as well. Now there's another
Speaker 1: piece here that I want to point to. We're supposed
Speaker 1: to get the sort of big jobs report that everybody
Speaker 1: really pays close attention to on Friday, so we'll keep
Speaker 1: our eyes out for that. In the meantime, we got
Speaker 1: the ADP Jobs Report. Let's put this up on the
Speaker 1: screen from CNBC. That report showed that private payroll surge
Speaker 1: by two hundred and ninety sixty thousand in April. Now
Speaker 1: that's a lot higher than expected. I do want to
Speaker 1: warn frequently, especially in recent months, for whatever reason, after
Speaker 1: the fact, these estimates have got consistently revised down, so
Speaker 1: it may not be as good as it looks. But
Speaker 1: the reason this is significant is on the one hand,
Speaker 1: you're like, okay, well, that's great. If you know more
Speaker 1: people are getting hired and there's this huge job growth,
Speaker 1: that's great for workers. You know, creates a tight labor market,
Speaker 1: makes it so that they can be choosier, they can
Speaker 1: demand higher wages, et cetera, et cetera. But the thing
Speaker 1: that cuts against that is, as the Fed is in
Speaker 1: this place where they have a giant question mark about
Speaker 1: what they're going to do next, things like this they
Speaker 1: look at as like, oh, well, we got to keep
Speaker 1: hiking rates and trying to crush the economy because clearly
Speaker 1: we haven't crushed workers enough, so it sort of cuts
Speaker 1: in both directions.
Speaker 2: Yeah, the economy thing is just really difficult because you know,
Speaker 2: even if you look at the unemployment rate, the unemployment
Speaker 2: rate is basically fake because we have more job openings
Speaker 2: than we have actual people who.
Speaker 3: Are in the job market.
Speaker 2: And that's part of the problem, which is that we
Speaker 2: have what seven to ten million prime age males who
Speaker 2: are just like literally not working. That's a societal problem,
Speaker 2: that's not an economic problem, and it's.
Speaker 3: One of those where you have no idea how to
Speaker 3: fix it. The vast majority of these.
Speaker 2: People are either playing video games on drugs, who are
Speaker 2: basically dropped out of society and are not they don't
Speaker 2: have no interest in participating in civic life or economic life.
Speaker 2: And again, like you can't just I don't know, can't
Speaker 2: You can't interest rate cut or hike your.
Speaker 3: Way out of that.
Speaker 2: That's a way bigger hole of government societal approach. I've
Speaker 2: been thinking about it a lot too, just because I
Speaker 2: think we keep trying to solve things with these blunt
Speaker 2: instruments when actually we have much more downstream factors, which
Speaker 2: you know, material realize in crazy things like housing prices
Speaker 2: and all this other stuff.
Speaker 1: Although remember we looked at that report that said most
Speaker 1: of the decrease in labor market participation was actually people
Speaker 1: who were going from like working full time plus to
Speaker 1: scaling back their hours, So it wasn't as much people
Speaker 1: who were pulling out of the workforce all together. It
Speaker 1: was more people who had had a reassessment during COVID
Speaker 1: and were like, you know what, my whole life is
Speaker 1: not my job.
Speaker 3: So that's definitely part of it.
Speaker 2: I'm talking about people who literally don't participate in the
Speaker 2: labor force at all.
Speaker 3: So this is a reduction in the labor force participation rate.
Speaker 2: But I'm saying like even in terms of the people
Speaker 2: who count to the rate specifically, they don't because they're
Speaker 2: not even seeking work. And yeah, I mean, look, that's
Speaker 2: a whole other thing that we've probably done quite a
Speaker 2: bit of work on. But I do think it is
Speaker 2: something we always have to think about whenever it comes
Speaker 2: to the way that we look at these statistics and
Speaker 2: the White House is like, oh, we have a three
Speaker 2: percent on employment rates, Like it doesn't even touch what
Speaker 2: is really going.
Speaker 1: It's always that's always a misliking statistic. There's a lot
Speaker 1: more going on there. The last piece about this Job's
Speaker 1: report that I think it's important to note is something
Speaker 1: else that we've been trying to highlight, which is how
Speaker 1: the economy is doing. It's very uneven. It's very strange
Speaker 1: because obviously, I mean the tech sector, advertising rates, any media,
Speaker 1: these industries are getting crushed. And in fact, if you
Speaker 1: look within these this Job's report, you have leisure and
Speaker 1: hospitality doing great gain of one hundred and fifty four thousand,
Speaker 1: Education and health services sixty nine thousand ad Construction actually
Speaker 1: fifty three thousand jobs added. Other sectors posting solid increases
Speaker 1: were natural resources and mining, trade, transportation utilities. But there
Speaker 1: were a couple sectors that are actually losing jobs right now.
Speaker 1: One is the financial sector because of these deposit runs
Speaker 1: and bank failures, et cetera. Et cetera, lost twenty eight
Speaker 1: thousand jobs for the month. Manufacturing also took a hit
Speaker 1: that's really noteworthy, down thirty eight thousand jobs, and it
Speaker 1: has been in contraction for the past six months. This
Speaker 1: in spite of the fact that the Biden administration has
Speaker 1: made some efforts to try to reshore and certainly, you
Speaker 1: know Biden would like to see manufacturing growth, So the
Speaker 1: fact that that sector continues to shed jobs, I think
Speaker 1: is worth noting. All right, let's get to this piece
Speaker 1: about what the hell is going to happen with the
Speaker 1: debt ceiling. Just to remind you, we are rapidly approaching
Speaker 1: the deadline. It's looking like early June when we would
Speaker 1: no longer be able to engage in what they call
Speaker 1: extraordinary measures to keep from defaulting on any of our
Speaker 1: congressionally approved obligations. So Democrats are trying to figure out
Speaker 1: what their plan is. Biden had long been saying we're
Speaker 1: not going to negotiate. We want to clean debt, sealing, increase,
Speaker 1: that's that. But after McCarthy was able to get the
Speaker 1: Republican House caucus to coal us around a package that
Speaker 1: they were able to narrowly pass through the House, Biden blinked.
Speaker 1: He did decide to meet with congressional leaders, including McCarthy
Speaker 1: and McConnell. So here's another piece of what Democrats are
Speaker 1: trying to float to deal with this whole situation. Put
Speaker 1: this up on the screen. The headline here is Democrats
Speaker 1: unveiled plan to bypass McCarthy ondebt ceiling increase. I think
Speaker 1: that's a little bit misleading of a headline, just because
Speaker 1: I don't think this has actually going to work, and
Speaker 1: they make it sound like it could. But the idea
Speaker 1: here is a discharge petition through the House that would
Speaker 1: force a vote on a clean debt sealing increase. In
Speaker 1: order to successfully use a discharge petition, you have to
Speaker 1: get a majority of members to say yes to bringing
Speaker 1: a vote to the floor. That means they would need
Speaker 1: a few Republicans to go along with them, and that
Speaker 1: seems at this point very unlikely, they say. Minority Leader
Speaker 1: Hakeem Jeffries and a Dear Colleague letter on Tuesday wrote,
Speaker 1: the Democrats play to file that discharge petition, which, if
Speaker 1: signed by two hundred and eighteen House members, would force
Speaker 1: a vote on a clean debt ceiling increase. So far, Republicans,
Speaker 1: even they interviewed some of the more sort of like
Speaker 1: moderate ones, they're all saying no. It would require signatures
Speaker 1: of five House Republicans to force a vote. Don Bacon,
Speaker 1: who's one of those moderates, told Axios Leader Jeffries refuses
Speaker 1: to negotiate that's not how it works in a divided government.
Speaker 1: We have to govern, which means we must find some agreement.
Speaker 1: We must negotiate. Another moderate Republican, speaking on the condition
Speaker 1: of anonymity, told Axios, I don't support a discharge petition.
Speaker 1: Biden has been doing a horrible job of outreach to moderates.
Speaker 1: They won't get that through, said another House Republican. So
Speaker 1: you know, this is an attempt by Democrats to put
Speaker 1: some pressure on McCarthy and show that they have some
Speaker 1: sort of a path to a clean debt ceiling increase.
Speaker 1: But it looks to me unlikely to work.
Speaker 2: It's unlikely, But it's one of those where it's like
Speaker 2: a pull the rip chord situation, like a reserve shoe,
Speaker 2: where at the very last moment, if five people were
Speaker 2: willing to sign on, they could just sign on to
Speaker 2: it, it would discharge.
Speaker 3: It come to the floor, they can amendment, they could
Speaker 3: pass it.
Speaker 2: Then it would be a question then of whether the
Speaker 2: Senate would be So I don't think it is in
Speaker 2: any way something that's going to happen immediately, but it's
Speaker 2: I wouldn't even call it a Plan B, it'd call
Speaker 2: it like Plan E. Yeah, you know for the very
Speaker 2: very last days of what it.
Speaker 1: Might well, it's like if there was some like major
Speaker 1: economic fallout exactly, and the moderates started getting freaked out,
Speaker 1: because these are they do in the Republican Caucus. Now
Speaker 1: you know, they have a number of members. We always
Speaker 1: point to the New York Congressional delegation, that one in
Speaker 1: seats where Joe Biden also won. They feel a lot
Speaker 1: of pressure in terms of the reelect and they do
Speaker 1: not want to be saddled with responsibility for some sort
Speaker 1: of calamitous debt sealing situation. So you could see if
Speaker 1: there was some major repercussions or for those that are
Speaker 1: you know, particularly tied in with Wall Street, if there
Speaker 1: starts to be major market repercussions and their Wall Street
Speaker 1: donors start freaking out, then you might see potentially five
Speaker 1: Republicans being like, all right, let me get on board
Speaker 1: with this discharge petition. There is another way though, potentially.
Speaker 1: I mean we've talked before about minting the coin and
Speaker 1: some of the other workarounds. There's a New York Times
Speaker 1: report that Biden aids are actually debating whether the debt
Speaker 1: ceiling is constitutional. So this is interesting. Yeah, so let
Speaker 1: me tell you. This is based on the fourteenth Amendment
Speaker 1: clause which states that quote, the validity of the public
Speaker 1: debt of the United States, authorized by law, including debts
Speaker 1: incurred for payment of pensions and bounties for services in
Speaker 1: suppressing insurrection or rebellion, shall not be questioned. There are
Speaker 1: some legal analysts, not like weird kooks, with some serious
Speaker 1: people who look at this and are like, that means
Speaker 1: that basically the debt sealing is not constitutional. And when
Speaker 1: you have these two conflicting instructions coming from Congress, one
Speaker 1: of them is, hey, spend this money and it's obligated
Speaker 1: and we've created, you know, these debts and obligations, and
Speaker 1: the other one is, don't do what you need to
Speaker 1: do to make sure to pay these things that we
Speaker 1: told you to pay that you know, the fourteenth Amendment
Speaker 1: basically comes in and says you got to honor the
Speaker 1: obligations that you've made. So they say, in terms of
Speaker 1: how this would go, what the economic fallout would be, quote,
Speaker 1: they say, there's a broad consensus on both sides that
Speaker 1: the move risks roiling financial markets. It's likely to cause
Speaker 1: a surge in short term borrowing costs because investors would
Speaker 1: demand a premium to buy debt that could be invalidated
Speaker 1: by a court. Moody's analytics anonymist Mark Zandi modeled a situation.
Speaker 1: What he believes would happen is there would be short
Speaker 1: term economic damage as people freaked out and this worked
Speaker 1: its way through the court system, but there would be
Speaker 1: long term gains if the Court's upheld that constitutional interpretation,
Speaker 1: because you would then remove the threat of future brinksmanship
Speaker 1: over the limit. Quote. The extraordinary uncertainty created by the
Speaker 1: constitutional crisis leads to a selloff in financial markets until
Speaker 1: the Supreme Court rules, but the economy avoids a recession
Speaker 1: and quickly rebound. So do I think it is likely
Speaker 1: that this direction is going to be pursued where the
Speaker 1: White House just decides the stet ceiling is unconstitutional, we
Speaker 1: are not going to abide by it, and you know
Speaker 1: it works its way through the court system. Do I
Speaker 1: think they even take that approach? No, I think it's
Speaker 1: unlikely because Biden's such an institutionalist. Jeff Stine had done
Speaker 1: previous reporting about, you know, discussions behind the scenes, and
Speaker 1: they had sort of dismissed out of hand all of
Speaker 1: the potential workarounds, but at least somebody in the administration
Speaker 1: is considering this option.
Speaker 2: So if anybody wants to know the history behind it,
Speaker 2: it's kind of interesting. The reason why the re radical
Speaker 2: reconstructionists in Congress added this to the fourteenth Amendment is
Speaker 2: because they were afraid that former Confederate states when they
Speaker 2: were readmitted, would gain political power and would repudiate previous
Speaker 2: federal debts to guarantee instead Confederate debt incurred during the
Speaker 2: war to back there. So basically they would repudiate like
Speaker 2: Union debts in order to try and pay off Confederate debts.
Speaker 2: So what they did is they added this in saying
Speaker 2: that the clause would make sure that they would guarantee
Speaker 2: all of the debts that were incurred by the United
Speaker 2: States during the Civil War, the specifically the Union army,
Speaker 2: and it would also, in their view, hopefully discourage loans
Speaker 2: to future insurrectionists in the event that somebody were to
Speaker 2: try and guarantee debt, you know, to some official or
Speaker 2: whatever who had not been what was a term, I forget,
Speaker 2: reconciliated or whatever at the time, they had to like
Speaker 2: swear an oath.
Speaker 1: That's where the bounties for services in suppressing insurrection? Are
Speaker 1: rebellion right? That language comes from.
Speaker 2: Anyway, fun history lesson as it's kind of interesting, you know,
Speaker 2: just to think about how all that played out and
Speaker 2: how it may now interact with the debt ceiling, and
Speaker 2: the debt ceiling is interesting. I remember talking about this
Speaker 2: in twenty eleven because on the one hand, you know,
Speaker 2: you have the House of Representatives which is supposed to
Speaker 2: appropriate on money, which they have done here technically, but
Speaker 2: then the debt ceiling itself was not really even in
Speaker 2: question up until the twenty tens with the Tea Party era.
Speaker 2: Then all of these legal interpretations. The big problem too,
Speaker 2: though with this plan is you know, it does have
Speaker 2: to survive the Supreme Court.
Speaker 3: Like you know, you can't just do whatever you want.
Speaker 2: So even if you agree and you have some legal
Speaker 2: authors or theories or whatever like, it would still get challenged,
Speaker 2: no question, by the Speaker of the House.
Speaker 3: You would just sue the president.
Speaker 2: And given that we have a conservative Supreme Court, I
Speaker 2: don't really think this one is on the table. Of
Speaker 2: all of the unilateral options. I think mint the coin
Speaker 2: has the best choice. But as Jeff laid out in
Speaker 2: his piece, that one is not again arantee either. Yeah,
Speaker 2: in terms of the legalistic framework the Federal Reserve and
Speaker 2: their acceptance of the coin.
Speaker 3: The way the Congress and all that would have it.
Speaker 3: The easiest way is.
Speaker 2: Just freaking past the debt ceiling, but that's probably not
Speaker 2: going to happen.
Speaker 1: I mean, I am in favor of them trying and
Speaker 1: all of these workarounds because I think this having every
Speaker 1: few years like this manufactured, genuine crisis occur. I think
Speaker 1: this is an insane way to run a country. And yeah,
Speaker 1: if you want to fight over what the spending should be, etc.
Speaker 1: You fight, you fight it when you're appropriating the money,
Speaker 1: not after you've already said we're going to pay X
Speaker 1: and Y and z, and then you're not willing to
Speaker 1: lift the debt ceiling like this weird technicality that we
Speaker 1: have as like an accident of history that they have
Speaker 1: to go through with, and you're going to use that
Speaker 1: to hold the entire country hostage. I think it's terrible.
Speaker 1: I think it's insane that we have this situation. So
Speaker 1: I am in favor of, even if there is some
Speaker 1: risk involved, trying to engage in one of these workarounds.
Speaker 1: But I think you're right in terms of the Supreme Court. Unfortunately,
Speaker 1: if the makeup of the Court was different, perhaps there
Speaker 1: might be more appetite for pursuing one of these workarounds.
Speaker 1: But I also just am fundamentally skeptical that Biden would
Speaker 1: do anything that's outside of the norms and outside of
Speaker 1: the box because he's such institutionalists. So, yes, we will
Speaker 1: see how this all works out. Surely will So this
Speaker 1: is an interesting development. Of course, we have long been
Speaker 1: covering the fact that it is insanely corrupt that members
Speaker 1: of Congress can trade stock with regard to companies that
Speaker 1: are directly impacted by the actions that they are taking
Speaker 1: as members of Congress, by inside information that they are
Speaker 1: receiving as members of Congress. There has been a big
Speaker 1: nationwide swell of grassroots bipartisan support to do something about
Speaker 1: this obviously insane situation. The issue had kind of fallen
Speaker 1: off the table. Every once in a while one of
Speaker 1: the parties would pick it up, and Kevin McCarthy, who's
Speaker 1: running for speaker, was before they know Republicans even got
Speaker 1: the majority, was like, oh yeah, we'll pass the stop
Speaker 1: trading ban when I'm Speak of the House. That we
Speaker 1: didn't hear anything about it. Nancy Pelosi did like a
Speaker 1: fake effort and inserted a poison pill to make sure
Speaker 1: it didn't pass. Well, we have a new effort and
Speaker 1: it's being spearheaded by two very unlikely allies, Matt Gates
Speaker 1: and alexandri Acossio at Cortes among Also, they have like
Speaker 1: you know, bipartisan like problem solvers, Caucus centrist type people
Speaker 1: who are involved in this effort as well. Gates was
Speaker 1: asked about his decision to work with AOC, someone he
Speaker 1: is very ideologically opposed to, and he had an interesting response.
Speaker 7: Take listen to us, AOC is wrong a lot. She'd
Speaker 7: probably say the same thing about me, But she's not corrupt,
Speaker 7: and I will work with anyone and everyone to ensure
Speaker 7: that Congress is not so compromised. We should disallow congressional
Speaker 7: stock trading for the same reason we don't allow the
Speaker 7: referee to bet on the game.
Speaker 3: And this is not a small amount of money.
Speaker 7: Seven hundred and eighty eight million dollars worth of securities
Speaker 7: traded by members of Congress last year. About one in
Speaker 7: every four members of Congress is doing this. And it's
Speaker 7: not exactly like I'm elected with a bunch of Gordon
Speaker 7: Gecko's and Bobby Axelrod's take. Lois Frankel, who you just mentioned.
Speaker 7: She's been a lawmaker since I was five years old,
Speaker 7: and I'm supposed to believe that all of a sudden
Speaker 7: she's making moves like she's Warren Buffett.
Speaker 1: Yeah, and we're about to talk about Lois Frankle specifically
Speaker 1: what he's referring to A good point, you know. To
Speaker 1: be honest with you, I'm not surprised that Gates is
Speaker 1: willing to work with AOC. I'm a little surprised that
Speaker 1: AOC is willing to work with Gates. I mean, I'm
Speaker 1: glad to see it, but I am a little surprised
Speaker 1: by it.
Speaker 3: I'm shocked that she's willing to do it.
Speaker 2: But the details of the bill itself are actually quite good.
Speaker 2: Let's go ahead and put this up there on the
Speaker 2: screen around the actual bill to ban these lawmakers from
Speaker 2: owning stocks. What it would do is called the Bipartisan
Speaker 2: Restoring Faith and Government Act. It's also sponsored by Brian
Speaker 2: Fitzpatrick and Raja christian Worthy, who's another Democrat.
Speaker 3: And where they're coming.
Speaker 2: To is one of the more stringent prohibitions on members
Speaker 2: spouses in any dependence from owning individual stocks making trades,
Speaker 2: requiring all members or covered family members who currently own
Speaker 2: any individual stocks to divest or place them in a
Speaker 2: completely qualified blind trust. Even I personally have issues with
Speaker 2: the blind trust thing, but it's one of those where,
Speaker 2: you know, willing to compromise, we can get to an
Speaker 2: actual qualified one.
Speaker 3: It would be even as fake as some of those
Speaker 3: can be.
Speaker 1: It's going to be monumentally difficult to get a majority
Speaker 1: of members of Congress to agree to this because they are,
Speaker 1: many of them profiting royally off of the inside information
Speaker 1: that they hold, and they are going to be loath
Speaker 1: to give up their ability to what was that crunchhaw said,
Speaker 1: better themselves, better themselves.
Speaker 3: Opportunity to better yourself.
Speaker 1: And to go that extra mile and do what I
Speaker 1: think should be done, which is they should all have
Speaker 1: to divest they're holding completely in none of this qualified
Speaker 1: blind trust thing. I think we have to live in
Speaker 1: the realm of political reality that that would be impossible
Speaker 1: to accomplish. That's unfortunate, but that is reality. So I
Speaker 1: think accepting some sort of compromise qualified blind trust situation
Speaker 1: here is the best we can possibly hope for. I
Speaker 1: would love to see, you know, once we get more
Speaker 1: details on the bill, i' love for someone who's the
Speaker 1: subject matter expert to look into because not all qualified
Speaker 1: blind trusts are quick created equal. So what are the
Speaker 1: specifics of those provisions and how much teeth does it have?
Speaker 1: I think that's a really important point. But we also
Speaker 1: had some news this week that underscores why this is
Speaker 1: so important. As they were referring to in that Matt
Speaker 1: Gates segment, put this next peece up on the screen.
Speaker 1: A Democratic Congressman Lois Frankel. She sold First Republic stock
Speaker 1: before the takeover and the collapse and bought JP Morgan stock,
Speaker 1: and of course JP Morgan Chase ends up being the
Speaker 1: massive beneficiary of this collapse because they get a sweetheart
Speaker 1: deal from the government to take over First Republic Bank.
Speaker 1: So looks like a really intelligent, just insightful, prescient, eerily
Speaker 1: prescient trade that Frankel was able to make.
Speaker 2: Your soccer, these guys are, I mean, there's just so
Speaker 2: shameless about their action, as you know, as Matt said,
Speaker 2: like the to somebody who has been in Congress for
Speaker 2: literally decades, and what I always just come back to
Speaker 2: with all of them is how is not enough? Like,
Speaker 2: why is it not enough to just sit with your
Speaker 2: personal finances? I just looked it up. She's worth two
Speaker 2: point five million dollars. That's plenty of money. If you
Speaker 2: want to make more money, you can leave Congress. But
Speaker 2: it's never enough for them. You know, she's literally been
Speaker 2: in the House of Representatives for decades. That's another question.
Speaker 2: How exactly you become a millionaire when you're a House
Speaker 2: of Representative of And she's somebody who's long been on
Speaker 2: the list of trading in companies that have been influenced
Speaker 2: directly by their committees. You know, a household or what
Speaker 2: should be some sort of household name. But is such
Speaker 2: a common activity that we have to only call it
Speaker 2: out in extraordinary times. That's why I think it's sick
Speaker 2: about it.
Speaker 1: When you see this one where you're like, come on, really, really, yeah,
Speaker 1: I think it's always important to underscore when you look
Speaker 1: at the overall number, do you really believe that these
Speaker 1: people are consistently beating the markets and doing better than
Speaker 1: you know, people whose job it is to make these
Speaker 1: sorts of trades. No, So, yeah, it is a disgraceful,
Speaker 1: disgraceful situation. I hope that this bipartisan effort picks up substeem.
Speaker 1: I'm really glad to see it moving forward, and we
Speaker 1: will certainly keep close track of it.
Speaker 2: Yes, we certainly will. I hope that it goes somewhere.
Speaker 2: But you know, you never know whenever it comes to
Speaker 2: things like this. In fact, you do know, which is
Speaker 2: unfortunately every single effort has been quashed.
Speaker 3: Let's go ahead and move on to Epstein.
Speaker 2: We want to give everybody and update two separate things
Speaker 2: coming out, actually one yesterday and another one today. Let's
Speaker 2: go and put this up there on the screen. Jeffrey
Speaker 2: Epstein Documents, Part two. Quote Dinners with Larry Summers and
Speaker 2: movie screenings with Woody Allen. My personal favorite is mister Summers, who,
Speaker 2: of course the former president of Harvard, former US Secretary
Speaker 2: of the Treasury, one of the most influential people in
Speaker 2: US economic.
Speaker 3: History, probably in decades.
Speaker 2: And it turns out not only was he hanging out
Speaker 2: with Jeffrey epstcene, he was even raising money from Jeffrey
Speaker 2: Epstein well after he was a convicted sex offender. In
Speaker 2: one case, he says, quote, I need small scale philanthropy advice.
Speaker 2: My life will be better if I raise one million
Speaker 2: dollars for Lisa.
Speaker 3: Lisa, by the way, is his wife. Mostly it will
Speaker 3: go to.
Speaker 2: Make a PBS series and for teacher training ideas.
Speaker 3: And it's because he.
Speaker 2: Wanted to raise this one million for his wife's pet
Speaker 2: PBS poetry project. Now, who amongst us has not had
Speaker 2: access to millions of dollars of our own personal wealth
Speaker 2: but felt the need to placate your do nothing wife's
Speaker 2: poetry PBS poetry idea by soliciting funds.
Speaker 3: From a billionaire.
Speaker 2: It's just very from a pedophile billionaire or pedophile multimillionaire, whatever.
Speaker 3: It's just such a common situation for some.
Speaker 2: Very relatable my life will be better, Well, then spend
Speaker 2: your own one million living on a Caribbean island.
Speaker 3: You're living in Cape Cod all these other places. It's
Speaker 3: just totally ridiculous.
Speaker 2: But what comes across in the new Epstein documents is
Speaker 2: not just his relationship with Summers. It's the fact that
Speaker 2: Summers felt so comfortable raising money from him after years
Speaker 2: of working with him throughout the Harvard Tenure reed Hoffman
Speaker 2: the billionaire venture Capitalists. He even visited Epstein's private island
Speaker 2: in the Caribbean.
Speaker 3: He was scheduled to stay over at his townhouse in
Speaker 3: twenty fourteen.
Speaker 2: Woody Allen, Now that one's a little bit less surprising,
Speaker 2: attended quote dozens of dinners with his wife. Yes, sur
Speaker 2: he did, at Epstein's mansion and invited him to film
Speaker 2: screening ade Barack. We've talked about that a lot either
Speaker 2: former Israeli prime minister.
Speaker 1: But you know, maybe we knew this already and I forgot.
Speaker 1: He says he was introduced to Epstein by another former
Speaker 1: Prime Minister of Israel, Troman for US.
Speaker 2: Oh yeah, okay, you know you have and you also
Speaker 2: had on the list Leon Black, who was one of
Speaker 2: the richest men on all of Wall Street with a
Speaker 2: former founder of Apollo Global Management, scheduled quote more than
Speaker 2: one hundred meetings with Epstein from twenty thirteen to twenty seventeen.
Speaker 3: Don't forget it's already blew my mind.
Speaker 2: Well, it's already come out through tax records that Leon
Speaker 2: Black paid Epstein over one hundred million dollars quote for
Speaker 2: taxis sure that.
Speaker 1: Must be some good tax.
Speaker 3: Great tax adviies.
Speaker 2: Once again, it's so ridiculous on its face. You have
Speaker 2: Jeffrey Epstin, who's not a qualified tax professional. You're worth
Speaker 2: nine billion. When you have nine billion, you have the
Speaker 2: top tax people on the planet who are available to you,
Speaker 2: who are not convicted sex offenders.
Speaker 3: So you know, like it just begs belief.
Speaker 2: There's a new report that came out just this morning,
Speaker 2: Crystal that I feel compelled to mention. In one day,
Speaker 2: September eighth, twenty fourteen, Jeffrey Epstein was scheduled to meet
Speaker 2: with Bill Gates, Thomas Pritzker, Leon Black, and Mortimer Zuckerman,
Speaker 2: four of the richest men in the entire country. That's
Speaker 2: just one day September eighth, twenty and fourteen, well after
Speaker 2: he had already been convicted as a sex offender. Literally,
Speaker 2: in the ten am hour, he was meeting with pritz
Speaker 2: Gren Gates. At the eleven thirty am hour, he was
Speaker 2: meeting with Black two pm, Mortimer Zuckerman three pm, the
Speaker 2: top lawyer at Goldman and the former White House Council
Speaker 2: Katheryn Rumler five pm Leon Botstein. I mean, every single
Speaker 2: one of the people who I'm just naming here are
Speaker 2: literally like titanically powerful and rich people, which is insane.
Speaker 3: Like, whenever you want.
Speaker 2: To think about it, all of it, by the way
Speaker 2: was actually scheduled to happen in and around either his
Speaker 2: residence or like at the Four Seasons Hotel, And I
Speaker 2: just think, like it's such a perfect view into how
Speaker 2: all of this intersects. The last person who he was
Speaker 2: scheduled with was a quote philanthropic advisor to wealthy families,
Speaker 2: And I just can't get away from this, Like, when
Speaker 2: you're worth a hundred billion, like Bill Gates, why do
Speaker 2: you need help raising money for anything? You have more
Speaker 2: money than God, Like you can fund anything.
Speaker 3: You want marriage out of pocket.
Speaker 2: That's my point though, that they are all of their
Speaker 2: excuses are bs. They don't need help raising money, They
Speaker 2: need help with something else. And the question is what
Speaker 2: is that something else? And that's what I would like
Speaker 2: to know well.
Speaker 1: And the other question is I mean, this is clearly
Speaker 1: not just him casually meeting this person or that person
Speaker 1: that hopped on. This was a very intentional, strategic pursuit
Speaker 1: of people with wealth, power, fame, et cetera connections that
Speaker 1: he engaged in as his job. I mean, this was
Speaker 1: his job was to meet and understand all of the
Speaker 1: you know, deepest needs and desires and whims and and
Speaker 1: help solve the problems of whatever wealthy, powerful person he
Speaker 1: could get his books into, which apparently was.
Speaker 3: A whole lot all of them.
Speaker 1: You know, just to go back to the Lean black one,
Speaker 1: more than one hundred meetings with Epstein from twenty thirteen
Speaker 1: to twenty seventeen. I don't know if I have one
Speaker 1: hundred meetings with my parents like that is. So that's
Speaker 1: like you're having like a weekly meeting for years. Yeah,
Speaker 1: I mean, this is that blows my mind. And you
Speaker 1: know he was pushed down of Apollo Global over whatever
Speaker 1: the hell was going on here. That one blew my mind.
Speaker 1: There was also there was.
Speaker 3: Twenty five times a year. That's actually every other week. Yeah, yeah,
Speaker 3: you do the like you are.
Speaker 1: A busy, powerful person and you're making time for Jeffrey
Speaker 1: Epstein every other week.
Speaker 3: Yeah, that's pretty crazy. That is cool. Fifty two weeks and.
Speaker 1: And you know we don't have the more than one hundred, right,
Speaker 1: so you know, it's it's more than every other week.
Speaker 1: So anyway, that is fun. Okay, So there's that. There's
Speaker 1: also a couple of anecdotes in this article that I
Speaker 1: think are really worth going over. One they talk about
Speaker 1: this woman Ava Anderson Dubin a longtime friend and wife
Speaker 1: of hedge fund billionaire Glenn Dubin, invited Epstein to charity
Speaker 1: event to which he contributed in the summer of twenty fifteen.
Speaker 1: Epstein sent her a quote funny story about checking into
Speaker 1: a California hotel with a young woman. Quote from Epstein.
Speaker 1: I went to park the car and the bellman said
Speaker 1: to this young woman, is that your father? He wrote
Speaker 1: in an email, referring to his female companion, who was
Speaker 1: then in her twenties a little old for him. And
Speaker 1: this woman, this billionaire wife or whatever, wrote back Glenn.
Speaker 1: Her husband laughed so hard. What a hilarious joke about
Speaker 1: how young the woman you're with, that they think that
Speaker 1: she's your daughter. So he clearly felt comfortable sharing some
Speaker 1: of his preferences with some of the circle. And there
Speaker 1: was another piece in here where we talked to this guy,
Speaker 1: Barnaby Marsh, who was an executive at a large charitable fund,
Speaker 1: the John Templeton Foundation. He met with Epstein roughly two
Speaker 1: dozen times off and for breakfast at the townhouse, according
Speaker 1: to these documents, And he said, so many of these
Speaker 1: billionaires knew him. Nobody ever said watch out for him.
Speaker 1: He said, Epstein convene people, including Microsoft co founder Bill Gates,
Speaker 1: to try to solve problems facing rich donors, such as
Speaker 1: how to make large gifts. Epstein told mister marsh that
Speaker 1: Epstein was managing money for mister Gates. Gates denies that
Speaker 1: that is the case. But I thought that quote was
Speaker 1: incredibly revealing that he's like, yeah, everybody just accepted this guy.
Speaker 1: All these billionaires knew him. He was part of the club,
Speaker 1: so no one asked any questions because he was in
Speaker 1: the club.
Speaker 2: I I just, frankly, don't believe it's that easy. Maybe
Speaker 2: I'm wrong, and maybe I'm very naive. Like, as I
Speaker 2: come back to this, when you're worth billions and billions
Speaker 2: of dollars, every single one of these people, you have
Speaker 2: enough money to quote unquote fund whatever you want completely
Speaker 2: out of your pocket. So why do you need this
Speaker 2: sketchy guys help doing this. Clearly something else is happening.
Speaker 2: I don't know what that's something else is. I will
Speaker 2: leave it to you to speculate. I am just saying,
Speaker 2: as you said, Crystal, you don't meet with somebody twenty
Speaker 2: five times twenty five times a year on average. That
Speaker 2: I have great friends who I don't see that often.
Speaker 1: Yeah, close, so not even close?
Speaker 3: Yes, ask yourself who you have met twenty five times?
Speaker 2: It better be like somebody who is basically colleague, people, kid,
Speaker 2: your kid, your culosest closed and even then you know
Speaker 2: the close ones, don't keep them that close.
Speaker 1: Whenever it comes to fans every other week, who do
Speaker 1: you meet with every other week in your life?
Speaker 2: And when you're worth nine billion dollars, you know, so
Speaker 2: anyway you can take that for what you will.
Speaker 3: Also have good news.
Speaker 2: The private island that he had, let's go and put
Speaker 2: this up there on the screen, has been bought by
Speaker 2: another billionaire.
Speaker 3: Stephen deck Off has agreed to purchase.
Speaker 2: The two islands for just a mere sixty million dollars.
Speaker 2: What exactly his plans are for the island, you know
Speaker 2: who knows, probably got a great deal on it because
Speaker 2: nobody else wanted it.
Speaker 1: They said that this was half of the initial list price.
Speaker 1: And apparently, you know, the rumor is or what was
Speaker 1: reported out as he wants to build some sort of
Speaker 1: a like resort.
Speaker 2: Well, it already was an exclusive resort for a certain
Speaker 2: other people with other proclivities.
Speaker 1: Kind of kind of perfect that you know, another billionaire.
Speaker 1: He sees a profit opportunity here, cour doesn't care about
Speaker 1: the history of it, going to go for the money
Speaker 1: making opportunity.
Speaker 3: All right, let's talk about the debates.
Speaker 1: Yeah, you guys are going to love this one. So now,
Speaker 1: apparently Cordion Media Matters wanting there to be debates is
Speaker 1: actually right wing and is just a plot, you know,
Speaker 1: against whatever. Okay, put this up in the screen. Let
Speaker 1: me read you a little bit of this. The headline
Speaker 1: is right wing media are exploiting RFK Junior as a
Speaker 1: spoiler candidate against Joe Biden. They say, many conservative media
Speaker 1: figures are celebrating longtime anti vaxxer RFK Junior's campaign as
Speaker 1: a potential spoiler against President Joe Biden's reelection, using his
Speaker 1: entry into the primary to call for democratic debates. Oh
Speaker 1: my god, can you imagine calling for debates that's horrifying,
Speaker 1: which the usually aren't held, they say when a party
Speaker 1: is running an incumbent. Now let me just pause and
Speaker 1: that first sentence because everything about it irritates, I mean,
Speaker 1: the framing of him as a potential spoiler. He's not
Speaker 1: running against him as an independent right right, if this
Speaker 1: was a like Jill Stein situation, who's running as you know,
Speaker 1: Green party or third party or whatever. I can see
Speaker 1: the case right, I could see how they could frame
Speaker 1: him or as a spoiler candidate. Now, I still wouldn't
Speaker 1: accept that framing because I think democracy is good and
Speaker 1: I think it's better to have more choices than fewer choices.
Speaker 1: But I could at least accept that there is an
Speaker 1: alternative view and that this could be a damaging thing
Speaker 1: to Joe Biden's reelection prospects. He and Marian Williamson too.
Speaker 1: They're not running against Joe as third party candidates. They're
Speaker 1: running against him in the primary. And all they want
Speaker 1: is exactly what the demomocratic base once, which is for
Speaker 1: people to be able to evaluate alternatives. Now, listen, I
Speaker 1: have no doubt that Steve bann and the other people
Speaker 1: that they quote here are they interested in sowing chaos
Speaker 1: and the Democratic Party, no doubt about it. Are they
Speaker 1: like good intention and just really want to see democracy
Speaker 1: plan and of course they don't want to see that.
Speaker 1: But to frame this as exclusively the interest and domain
Speaker 1: of you know, right wing like Steve bannonites is just incredible.
Speaker 1: It's not just misleading, it is an out and out lie,
Speaker 1: and so let me show you how I know that
Speaker 1: to be the case. There was just a poll that
Speaker 1: was done by Newsweek and they asked people to put
Speaker 1: this up on the screen. They asked, Joe Biden voters, Okay,
Speaker 1: not all voters, just people who voted for Joe Biden
Speaker 1: last time around. Should the Democratic Party hold primary debates?
Speaker 1: Guess what? Seventy nine percent of them said, obviously, like,
Speaker 1: we actually believe in democracy and we would like to
Speaker 1: see some primary debates. Are those right wing people looking
Speaker 1: for a Joe Biden spoiler to reelect Trump? Of course not.
Speaker 1: They just look at the reality of this very aged
Speaker 1: president and their deep concerns about the future of the
Speaker 1: country and by the way, his ability to defeat Donald Trump,
Speaker 1: and they're like, maybe we should at least have a
Speaker 1: chance to evaluate our options. And the last thing I'll
Speaker 1: say about the cigar, if I gets your reaction, is
Speaker 1: part of the cope in that Media Matters article is
Speaker 1: all about how well they didn't have. You know, they
Speaker 1: don't normally have debates in the primaries when there's an
Speaker 1: incumbent president. First of all, oftentimes there isn't a significant challenge.
Speaker 1: And whatever you think about Mary and Williamson and RFK Junior.
Speaker 1: They're already both pulling in double digits RKS at like
Speaker 1: twenty percent. Okay, these are significant challenges. They have nationwide followings.
Speaker 1: People deserve to hear from them, and if you have
Speaker 1: issues with them, then you shouldn't be worried about them
Speaker 1: being up on a stage. Great they can be exposed
Speaker 1: as the clowns that some people think that they are,
Speaker 1: or perhaps they will have interesting things to add to
Speaker 1: the conversation that'll be relevant and by the way, might
Speaker 1: actually make Joe Biden a better candidate if he is
Speaker 1: able to survive that process. I think it is an
Speaker 1: insane argument to say that, oh, well, because we didn't
Speaker 1: really have democracy in the past, we shouldn't have democracy now.
Speaker 1: Like that is a ridiculous absurd you know, fig leaf
Speaker 1: to try to use to cover your anti democratic authoritarian tendencies.
Speaker 2: Here, once again, I always come back to nineteen eighty
Speaker 2: President Jimmy Carter is weak, feckless, some would say, some
Speaker 2: would say about to get wiped out by Ronald Reagan.
Speaker 2: That was empirically true.
Speaker 3: Senator Ted Kennedy decides to run against him.
Speaker 2: They do have actual debates on the debate stage, they
Speaker 2: fight it out in a big primary and guess what, Crystal,
Speaker 2: he won only thirty seven percent of the vote.
Speaker 3: You know Ted Kennedy did at that time. That's not
Speaker 3: too far away.
Speaker 2: If you combine Mary Anne Williamson and Bobby Kennedy or
Speaker 2: and yeah, what is he his nephew? I guess rfk
Speaker 2: Junior would be Ted Kennedy's nephew. So it wasn't that
Speaker 2: long ago that you had a competitive primary with the
Speaker 2: debate where Kennedy only ended up winning thirty seven percent,
Speaker 2: and that was only in a one off. So if
Speaker 2: you have two candidates in the race or roughly around that,
Speaker 2: then why shouldn't they be treated in the exact same
Speaker 2: seriousness in way that we handled the nineteen eighty Democratic
Speaker 2: presidential primary. It was totally reasonable, and by the way,
Speaker 2: there's a lot of evidence to say Carter was probably
Speaker 2: better off for it because it made him sharp and
Speaker 2: had to defend his record before he went into the
Speaker 2: incumbency fight against Ronald Reagan. So it's not even like
Speaker 2: it was all that bad, and it also shored up
Speaker 2: as his support because he definitively won the primary.
Speaker 3: Again, he wasn't just handed the nomination.
Speaker 1: The Republicans had a very spirited debate in twenty sixteen,
Speaker 1: and guess what, it didn't hurt Donald Trump. He ends
Speaker 1: up winning, and I think probably made him a better
Speaker 1: candidate for better or worse, because he went through that
Speaker 1: democratic process. Barack Obaman, Hillary Clinton had a very spirited
Speaker 1: primary debate, and guess what, it really sharpened him and
Speaker 1: made him a much more effective candidate going in two
Speaker 1: thousand and eight. So this notion that democracy will damage
Speaker 1: the prospects of whoever emerges from the Democratic primary, I
Speaker 1: think is ludicrous. I think it's ahistorical, and I think
Speaker 1: it's just incredibly intentionally misleading. So we see the path
Speaker 1: they're on here. Number one, they just dismiss any potential challengers.
Speaker 1: These ones aren't serious. It's like according to who because actually,
Speaker 1: if you're as American people, and this is with total
Speaker 1: media blackout, total media's mirror campaigns, still, the Democratic primary
Speaker 1: base is like, we see something there to the tune
Speaker 1: of double digit support. And I'd be very interested, by
Speaker 1: the way, to see a pole out of New Hampshire
Speaker 1: specifically of these three candidates. I think you would see
Speaker 1: a pretty interesting landscape. So they want to just dismiss
Speaker 1: them as kooks and wacos. You have no choice because
Speaker 1: you know, none of them are quote unquote serious. Any
Speaker 1: sort of plot to have a real democratic, small d
Speaker 1: democratic process is just a right wing scheme, spoiler scheme.
Speaker 1: And you know, bottom line, we just don't think that
Speaker 1: you should have a choice in the interest of saving democracy.
Speaker 1: We should have no democracy effectively.
Speaker 2: Yeah, I think it's completely ridiculous. I support debait I
Speaker 2: think debates are good. I'm doing my monologue today about
Speaker 2: debates about presidential debates and how there are different ways
Speaker 2: that we can fix it. And yeah, I just come
Speaker 2: back to the truth that at the times in American
Speaker 2: history when we had the least amount of direct democracy.
Speaker 2: So I'm talking here about like when senators were appointed
Speaker 2: at one point by the state legislature, which is insane
Speaker 2: in aspect, they were basically.
Speaker 3: Just bought off.
Speaker 2: It's like whoever the richest guy was was the person
Speaker 2: who would get himself appointed to the Senate. And it
Speaker 2: was outrageously corrupt. And even in terms of the primary
Speaker 2: system or the convention system, where you'd have like smoke
Speaker 2: filled back rooms in the pre primary age, which again
Speaker 2: not that long ago really only created in the nineteen sixties.
Speaker 2: Before that time, it was outrageously corrupt because you had
Speaker 2: the big business interest and all these other people just
Speaker 2: pick who they decided to be was president. Now, look,
Speaker 2: I love FDR. I think he was a great president,
Speaker 2: but think about this. They selected Harry Truman. They didn't
Speaker 2: even tell anybody that FDR was deathly ill whenever he's
Speaker 2: running for his fourth term. And they effectively selected this
Speaker 2: man for political purposes with no truth to the American
Speaker 2: people that he very likely would become the next president
Speaker 2: of the United States. That's crazy, like when you really
Speaker 2: consider it. On the merrits, it worked out. I think
Speaker 2: Truman was a good president, but it could have gone
Speaker 2: the other way. It could have gone the Andrew Johnson way,
Speaker 2: which he has well.
Speaker 1: Also. I mean, here's the other thing. Joe Biden doesn't
Speaker 1: do many press appearances, he doesn't give many interviews. So
Speaker 1: you have a Democratic base that continues to be very
Speaker 1: concerned with electability and really wants to make sure that
Speaker 1: they can defeat you know, Donald Trump or if it's
Speaker 1: Rond De Santis or whoever it ends up being, but
Speaker 1: probably Donald Trump. They're very interested in that and they
Speaker 1: deserve an opportunity to assess whether Joe Biden is still
Speaker 1: that candidate, and I think that there are some real
Speaker 1: questions about that. And by the way, if Biden's own
Speaker 1: team felt confident in his ability to you know, perry
Speaker 1: and debate and articulate a vision, they would be approaching
Speaker 1: the campaign with a very different strategy. Right now, there
Speaker 1: are no big campaign rallies planned. He launches with this
Speaker 1: low key video. Now he's really planning on just trying
Speaker 1: to stay in the shadows and hope that Trump is
Speaker 1: insane enough that people are like, all right, I guess
Speaker 1: we got to stick with Joe. And he's hoping that
Speaker 1: the media, like this person did for them, will just
Speaker 1: try to convince the whole Democratic base that you have
Speaker 1: no other options, so stuck it up and vote for
Speaker 1: Joe again.
Speaker 3: Very true, Chriscell, What are you taking a look at?
Speaker 1: There is a new shocking report out of Louisville, Kentucky.
Speaker 1: So apparently the Department of Labor found that two ten
Speaker 1: year olds were working unpaid shifts at a McDonald's restaurant.
Speaker 1: This is just as horrifying as it sounds. According to
Speaker 1: CBS News, officials said The children were not paid yet
Speaker 1: sometimes worked as late as two am, and they quote
Speaker 1: prepared and distributed food orders, cleaned the store, worked at
Speaker 1: the drive through window, and operated a register. Investigators learned
Speaker 1: that one of the two children was allowed to operate
Speaker 1: a deep friar that is a prohibited task for workers
Speaker 1: under the age of sixteen. Now there's a good reason
Speaker 1: kids under sixteen are barred for working the deep frier.
Speaker 1: It's really dangerous. Just a year ago, a fifteen year
Speaker 1: old in Tennessee suffered hot oil burns while working the
Speaker 1: deep frier at a different McDonald's. Now, the owner of
Speaker 1: this offending McDonald's, Bower LLC, claimed no awareness of the
Speaker 1: fact that ten year olds were working the register, manning
Speaker 1: the drive through, and operating the deep frier. Owner Sean
Speaker 1: Bauer told CBS News the kids were not approved to
Speaker 1: be in that part of the restaurant and that they
Speaker 1: were there at the direction of and in the presence
Speaker 1: of their parents. But this is far from the first
Speaker 1: child labor law violation from mister Bauer's company. They were
Speaker 1: hit with a forty thousand dollars assessment after the Department
Speaker 1: of Labor found they had twenty four kids under sixteen
Speaker 1: working longer than approved hours. Nor is this a problem
Speaker 1: confined to this one McDonald's franchisees. There are three McDonald's franchisees,
Speaker 1: which combined operates sixty two McDonald's that were found to
Speaker 1: have worked three hundred and five children longer than the
Speaker 1: allowable hours. Now, this is part of a larger trend which,
Speaker 1: through new laws and violations of existing laws, is working
Speaker 1: to roll back a century's worth of child labor protections.
Speaker 1: According to the Economic Policy Institute, the number of child
Speaker 1: labor law violations has skyrocketed over two hundred percent since
Speaker 1: twenty fifteen, and we have seen a thirty seven percent
Speaker 1: increase just year over year. A recent investigation found kids
Speaker 1: aged thirteen to seventeen employed by a meat packing sanitation company.
Speaker 1: These kids were forced to clean backsaws, brisket saws, and
Speaker 1: head splitters at meat packing plants owned by some of
Speaker 1: the top names in big food in this country. New
Speaker 1: York Times recently published a heartbreaking report on the way
Speaker 1: undocumented kids are being funneled into a nationwide network of
Speaker 1: effectively indentured servitude, exploited for low wages, backbreaking labor, and
Speaker 1: horrifying conditions, all because their youth and immigration status make
Speaker 1: them easy prey. Just as disturbing is the successful industry
Speaker 1: lobbying effort to make some of these harmful practices perfectly legal.
Speaker 1: This year alone, eight bills have been pushed in six
Speaker 1: different states to roll back child labor restrictions. Arkansas made
Speaker 1: headlines when Governor Sarah could Be Sanders signed a law
Speaker 1: repealing restrictions on fourteen and fifteen year olds as a
Speaker 1: group of children appearing rather bereft looked on. We covered
Speaker 1: recently how Iowa has gone even further. A newly signed
Speaker 1: law brings us straight back to dickens, with young teens
Speaker 1: working on assembly lines, in meat coolers, in construction, and
Speaker 1: in industrial laundries, and a circle back here to McDonald's
Speaker 1: illegally employing literal ten year olds. One of the main
Speaker 1: drivers behind these changes is the powerful National Restaurant Association,
Speaker 1: a giant lobby for big food interests including McDonald's. More
Speaker 1: perfect union basically got one of their lobbies to admit
Speaker 1: that they wrote the draconian Iowa bill. The timing of
Speaker 1: this push to kids into meat lockers and handling deep friars,
Speaker 1: by the way, is no accident. For my entire life,
Speaker 1: employers had the upper hand with workers in every single way.
Speaker 1: They could treat the most disposable, they could crush any
Speaker 1: fledgling union attempts, they could steal their wages, and they
Speaker 1: could pay them very little. Well, a lot of this
Speaker 1: is still going on, but now workers are trying to
Speaker 1: get immodicum of power back. Unemployment is low, labor market
Speaker 1: is tight. That gives individual workers more power on their own,
Speaker 1: since they can leave an abuse of low paying or
Speaker 1: exploited of jobs with a higher level of confidence that
Speaker 1: they will be able to find something else. In fact,
Speaker 1: even as inflation continues to buy there's some decently encouraging
Speaker 1: things happening for the lowest wage workers. Working paper from
Speaker 1: the National Bureau of Economic Research finds that wages are
Speaker 1: rising quickest for the lowest paid workers. That this trend
Speaker 1: has actually reduced inequality. That's a phrase I have not
Speaker 1: heard in my entire life. This trend has also shrunk
Speaker 1: the college wage. Premium retailers like Target and Walmart have
Speaker 1: been forced to hike wages in order to retain or
Speaker 1: attract the workers that they need to staff their stores.
Speaker 1: And obviously they're not doing all of this out of
Speaker 1: the goodness of their hearts. But rather than have to
Speaker 1: raise wages, big business would rather maintain their record breaking
Speaker 1: profit margins and just find cheaper and more vulnerable labor.
Speaker 1: And that, of course, is where the kids come in.
Speaker 1: Employers love child labor for the same reason today as
Speaker 1: they did a hundred years ago. Kids are cheap, they
Speaker 1: can be more easily manipulated, and crucially, they're less likely
Speaker 1: to form a union. In fact, it was the labor
Speaker 1: movement which successfully pushed the first federal child labor protections.
Speaker 1: All the way back in the nineteen thirties, photographer Lewis
Speaker 1: Hine traveled the country documenting kids in dangerous and horrible
Speaker 1: working conditions. This shocked and horrified America. At the same time,
Speaker 1: activists made the case of the country that child labor
Speaker 1: was bad for everyone except big business because it also
Speaker 1: depressed wages for adult workers. That was a compelling argument
Speaker 1: at the time, as the nation was struggling through the
Speaker 1: Great Depression. Organized labor made the success of this multi
Speaker 1: pronged effort possible. Now, in our current moment, unions have
Speaker 1: been beaten back. Union density is at historic lows. However,
Speaker 1: employers especially those in the service sector, feel the threat
Speaker 1: of potential unionization like they haven't in decades. Successful union
Speaker 1: drives at Starbucks, Rii, Chipotle, and elsewhere they have made
Speaker 1: fast food and retail a real target. The desire to
Speaker 1: avoid a union is another often overlooked reason that big
Speaker 1: business prefers to rely on young teens for their workforce
Speaker 1: or even apparently ten year olds. Now, if there's one
Speaker 1: thing I've realized in the past few years, it's that
Speaker 1: bad old ideas they're never really dead. They're just dormant,
Speaker 1: waiting for a moment of opportunity to rear their ugly
Speaker 1: heads again. Whether it's the post dobs whores, women being
Speaker 1: forced to bleed out in a parking lot until they're
Speaker 1: near death before doctors will actually treat them, or new
Speaker 1: effort to trap spouses in unhappy or abusive marriages by
Speaker 1: rolling back no fault divorce laws, or kids being sent
Speaker 1: to clean head splitters in meat packing plants when they
Speaker 1: should be you know, doing homework and getting ready for
Speaker 1: school or just being kids. We must apparently remain ever
Speaker 1: vigilant to make sure that rights remain intact and that
Speaker 1: our fast food is not being served up by Happy
Speaker 1: Meal age children. These days, nothing is sacred. This story
Speaker 1: has sparked a national outcry just because of the tender
Speaker 1: age of these because.
Speaker 3: They're so young.
Speaker 2: And if you want to hear my reaction to crystals
Speaker 2: model become a premium subscriber today at breakingpoints dot com.
Speaker 1: All right, sorry are we looking at well.
Speaker 2: In nineteen sixty four, Marsha McLuhan published a landmark book.
Speaker 2: It was titled Understanding Media the Extensions of Man. In
Speaker 2: the book, McLuhan coined a popular phrase that you might
Speaker 2: have heard quote, the medium is the message. The theory
Speaker 2: behind it is that focusing on the content produced in
Speaker 2: mass society is less important than a study of the
Speaker 2: medium producing the content, as in, don't look to critique
Speaker 2: a specific TV show, look to cable TV and the
Speaker 2: distribution itself. The medium is the message a very useful
Speaker 2: analytical tool. Another way to think about it is systems
Speaker 2: versus individual actors. Many neoliberals today speak about how politics
Speaker 2: is broken. What they really mean, though, is their party
Speaker 2: is good and the other party is bad.
Speaker 3: But when people like me say.
Speaker 2: Politics is broken, we're seeing the whole system, both parties.
Speaker 2: We're taking a step back. It's not about red and blue.
Speaker 2: We're talking about the construct itself. Why that is poisonous.
Speaker 2: That's the framework I'm using to look at our current
Speaker 2: presidential debates, events which both mean everything and are meaningless.
Speaker 2: We have reams of political science evidence that exists to
Speaker 2: say presidential debates have almost no impact on the eventual
Speaker 2: outcome of an election anymore, there is decent evidence to
Speaker 2: say they are matter a lot in the context of
Speaker 2: primary debates intra party, where hyper committed voters want to
Speaker 2: see how candidates fare against each other and see if
Speaker 2: they could ever see them as president. Yet that's not
Speaker 2: the only reason to have debates, is it. Sometimes it's
Speaker 2: not just about whether it would change in election. Sometimes
Speaker 2: it's the only forum that exists where candidates can get
Speaker 2: pressed directly about what they actually think, not just from
Speaker 2: their opponent, but also by the press. That's why I
Speaker 2: was heartened to see some news that the mainstream media
Speaker 2: is actually freaking out about right now, the Republican Party,
Speaker 2: and specifically Donald Trump's effort to ditch the Commission on
Speaker 2: Presidential Debates. Top Republican officials on Trump's behest recently met
Speaker 2: with the largest TV networks in the country to pose
Speaker 2: an interesting question to them, what would you do if
Speaker 2: the party ditched the Commission on Presidential Debates and sets
Speaker 2: up a new one outside.
Speaker 3: Of the existing system.
Speaker 2: The TV networks did not give an answer, but the
Speaker 2: leak is no coincidence. The Commission on Presidential Debates is
Speaker 2: a perfect example of how flawed and terrible our current
Speaker 2: system is and how much the dying establishment media maintains
Speaker 2: control on our discourse. For historical context, the Commission on
Speaker 2: Presidential Debates is not some hallowed institution. It was only
Speaker 2: created in nineteen eighty seven by the chairs of the
Speaker 2: Republican and Democratic parties.
Speaker 3: But well, a lot of.
Speaker 2: People don't know is that the reason this was created
Speaker 2: was specifically to rig the system by both candidates. You
Speaker 2: see before the Commission on Presidential Debates, the League of
Speaker 2: Women Voters sponsored presidential debates from nineteen sixty to nineteen
Speaker 2: eighty eight. By all accounts, the actually did a fantastic job.
Speaker 2: To this day, you can go back and you can
Speaker 2: watch debates from nineteen sixties to nineteen eighty eight, and
Speaker 2: you can see much more substance than any of the
Speaker 2: debates in the cable TV.
Speaker 3: The reason the League.
Speaker 2: Itself pulled out from the debates, is one that pertains
Speaker 2: to our subject. In nineteen eighty eight, the Ducaccus and
Speaker 2: Bush campaign negotiated a secret memorandum of understanding where the
Speaker 2: two campaigns met and hashed out terms of how the
Speaker 2: debate would go, including but not limited to the selection
Speaker 2: of questioners, the composition of the audience, hall, access for
Speaker 2: the press, and tons of other issues like that. The League,
Speaker 2: to its credit, said no, we're not doing that. We're
Speaker 2: not going to give you any of that. Our debates
Speaker 2: are independent and we are up to us. So what
Speaker 2: do the campaigns do? They ditched the League and they
Speaker 2: created our current system. The Commission on Presidential Debates is
Speaker 2: sponsored by massive fortune five hundred companies, so called luminaries
Speaker 2: of society. These people together partner with establishment media journalists
Speaker 2: like Chris Wallace last time around for debate. For our
Speaker 2: current debates from that point forward, they negotiate the awful
Speaker 2: and staid format that we have all become used to,
Speaker 2: the so called head to head debate in round one,
Speaker 2: where the answers are fake and they're short, and all
Speaker 2: the rules are agreed to beforehand, then you learn absolutely nothing.
Speaker 2: The famous town Hall debate for the second one, that
Speaker 2: too is rigged, it's a TV event, and then finally
Speaker 2: the Foreign policy debate.
Speaker 3: They've become predictable.
Speaker 2: Affairs where Americans learn nothing and again to reiterate this
Speaker 2: is by design. The entire reason for the Commission's existence
Speaker 2: is specifically because campaigns and major parties want as much
Speaker 2: control as possible, even they seem to have gotten carried away,
Speaker 2: though in fact, one of the reasons the Trump campaign
Speaker 2: doesn't trust the Commission is because during the scheduled second debate,
Speaker 2: the selected moderator was c SPAN Steve Scully. Trump ended
Speaker 2: up missing that debate because he contracted COVID. But there
Speaker 2: was one issue with Scully. He was actually an intern
Speaker 2: for Joe Biden in his college days. I mean, come on,
Speaker 2: there are a lot of liberal journalists in this country.
Speaker 2: Can't you at least select one that didn't work for
Speaker 2: one of the guys on the stage. It's just absurd. Now,
Speaker 2: the only reason he didn't get more attention is because
Speaker 2: that debate never happened. But it does reveal how deep
Speaker 2: the rot inside the Commission has actually gone. It's time
Speaker 2: to just blow up the Commission on President Debate it's
Speaker 2: time to kick it back to an open system. Let
Speaker 2: chaos reign, because inside of chaos we might.
Speaker 3: Actually accidentally get information.
Speaker 2: And let's basically anyone who should be able to bid
Speaker 2: for both of those candidates get a format, and let's
Speaker 2: change the rules, because I think all of us can
Speaker 2: agree that the current system is not working for us. Unfortunately,
Speaker 2: though as I already said, this is less likely to happen.
Speaker 2: Biden's an institutionalist. He almost certainly is going to stick
Speaker 2: to the Commission because he likes so much control they're
Speaker 2: willing to give him.
Speaker 3: But this is an opportunity.
Speaker 2: Nonetheless, if Trump pulls out, who knows what's going to
Speaker 2: happen next time around. And when it does, people like
Speaker 2: us and all of us will be waiting. And I
Speaker 2: think that's the fun part around this. I mean, the
Speaker 2: Commission on Presidential Debates is just complete bs.
Speaker 1: And if you want to hear my reaction to Sager's monologue,
Speaker 1: become a premium subscriber today at breakingpoints dot Com.
Speaker 3: Joining us now is Ben Smith.
Speaker 2: He's the editor in chief of Semaphore and he's also
Speaker 2: the author of a great new book, Let's go and
Speaker 2: put it up there on the screen traffic, genius, rivalry
Speaker 2: and delusion in the billion dollar race to go viral
Speaker 2: Ben Very apt timing with this new book, given the
Speaker 2: current end of BuzzFeed News, of which you were once
Speaker 2: at the helm of the news that we might see
Speaker 2: a bankruptcy soon from Vice. Many of the titans of
Speaker 2: the twenty tens media era appear to be on their
Speaker 2: way out. It's something that you were literally involved in,
Speaker 2: and now you're writing about it in retrospect. First of all,
Speaker 2: why do you decide to write the book as kind
Speaker 2: of a look back on something as you start something new?
Speaker 2: And how does it relate to everything is going on
Speaker 2: right now?
Speaker 8: Yeah, and thank thanks for having me on and congratulations
Speaker 8: on the show.
Speaker 3: Thank yous.
Speaker 8: The you know I was when I was in After
Speaker 8: I left BuzzFeed in twenty nineteen, I went to The
Speaker 8: Times and was the media columnist for a couple of years,
Speaker 8: and I guess found myself feeling like it was, as
Speaker 8: you say, kind of the end of an era, but
Speaker 8: also then wondering kind of okay, what was that did
Speaker 8: we all just live through?
Speaker 5: You know, where where did it begin? And why?
Speaker 8: And I had, I think been on the margins of
Speaker 8: it as a young reporter in New York in the
Speaker 8: early aughts and kind of knew that there were these
Speaker 8: new things, these new blogs sites called Hoffington Posts, but
Speaker 8: I was off blogging about politics and New York politics
Speaker 8: sort of a different thing, and really stepped into the
Speaker 8: middle of it really twenty twelve when I joined BuzzFeed
Speaker 8: and heard all these stories about like the weird origins,
Speaker 8: and was fascinated by that and just thought, I don't know,
Speaker 8: partly because we all had a little bit extra time
Speaker 8: on our hands during the pandemic, that it would, yeah,
Speaker 8: that it would be interesting to go back and just
Speaker 8: try to understand where this all started and who where,
Speaker 8: you know, how we got to where we'd gotten to
Speaker 8: where we are now.
Speaker 1: Yeah, And what do you think are some of the
Speaker 1: qualities that defined the ascendant business models and kind of
Speaker 1: insos of these you know, what were truly media superstars
Speaker 1: at the time, BuzzFeed News, Vice News in particular, they
Speaker 1: had huge valuations. People were throwing money at them. This
Speaker 1: was thought, you know, this was the new big thing.
Speaker 1: What do you think were some of the com menalities there?
Speaker 8: Well, I think you sort of, you know, have to
Speaker 8: put your head back in what feels like this very
Speaker 8: far away moment of the early two thousands where you know,
Speaker 8: the mainstream media, the Conde Nasts and New York Times
Speaker 8: is in television networks really weren't on the Internet in
Speaker 8: any meaningful way, and if you were, like most of
Speaker 8: us on the internet, they weren't, you know, they felt
Speaker 8: totally disconnected, and they had actually also blown the biggest
Speaker 8: story of our careers, the Iraq War, in large part,
Speaker 8: and so there was a sense that I think people
Speaker 8: forget that they were, that people were ready for something
Speaker 8: really new and were suspicious of these institutions that was
Speaker 8: deserved and so the you know, yeah, these these places,
Speaker 8: in differing ways, were sort of waging an assault on
Speaker 8: the establishment and using these new tools to tell different
Speaker 8: stories different ways, sometimes very explicitly. I think Gawker really
Speaker 8: was like, We're going to rip the masks off these
Speaker 8: hypocrits and show them what they really are. That was
Speaker 8: sort of its mission, and at times in really delightful ways,
Speaker 8: like this site Jezebel, which actually it was women's blog
Speaker 8: that they launched in seven and immediately did that and
Speaker 8: just these very kind of literal senses. They put out
Speaker 8: a bounty, a ten thousand dollars bounty for unretouched photographs.
Speaker 5: For one of these magazines, which at the time was
Speaker 5: like a really revelatory thing to do.
Speaker 8: And somebody in fact did like steal or take a
Speaker 8: photo of Faith Hill, the country singer that had where
Speaker 8: she still had her smile lines at her freckles, and
Speaker 8: brought it to them and they triumphantly posted it. But
Speaker 8: it really did, you know, put pressure in these magazines
Speaker 8: to represent women more like they were like, which is
Speaker 8: sort of a small metaphor for what they at their
Speaker 8: best I suppose we're trying to do.
Speaker 2: I read the Yeah, the New York Times piece that
Speaker 2: you published around Jezebel, and I thought it captured everything
Speaker 2: both about the blogging era but also about audience capture.
Speaker 2: That's something you and I had talked a little bit
Speaker 2: about before, Ben, just about how some of the very
Speaker 2: early signs of what was to come were all present
Speaker 2: within that. One of the things that I think were
Speaker 2: a lot of people got excited, both investors and I
Speaker 2: think people working in it was feeling that they were
Speaker 2: on the forefront of something new at the time.
Speaker 3: So in retrospect, how new.
Speaker 2: Was doing news on the Internet, and what are some
Speaker 2: of the lessons for you know, people like us, people
Speaker 2: like yourself that are still trying to actually build something new.
Speaker 8: So I do think digital media represented a big cultural shift.
Speaker 8: I mean I think that, you know, it's sort of
Speaker 8: for historians of the future to look back, but the
Speaker 8: extent to which you know, if you wanted to distribute
Speaker 8: information widely, you needed to control a printing press or
Speaker 8: a television tower or then a capable channel. I mean
Speaker 8: that was real, like that is how the world was organized,
Speaker 8: and that suddenly the gatekeepers couldn't really hold the gates,
Speaker 8: you know, for better and for worse. And I think
Speaker 8: that's all still being sorted out. Really did change society
Speaker 8: and politics and the media, and you know, and there
Speaker 8: were these huge opportunities, and you know, I think initially
Speaker 8: one of the things that's again so interesting to go
Speaker 8: back was that it was assumed that this was fundamentally
Speaker 8: kind of a progressive space. Facebook in particular was where
Speaker 8: college kids hung out, so obviously that was a place
Speaker 8: that would support Barrock Obama, and that these were all
Speaker 8: tools that would in some sense culminate in Barack Obama's
Speaker 8: election in two thousand and eight. And I think one
Speaker 8: of the big surprises for me in reporting it was
Speaker 8: how close your people, Saeger, the kind of populist right
Speaker 8: wingers were all along to that. You know, the guy
Speaker 8: who founded four Chan, which I'm not sure you want
Speaker 8: ownership of, but was working out of us for his offices.
Speaker 8: And Andrew Breichbart was a co founder of Huffington Post. Yeah,
Speaker 8: and Steve Bannon was hanging around there as well, and
Speaker 8: you sort of and I think in some ways it
Speaker 8: was best suited for a kind of anti establishment, unconstrained
Speaker 8: right wing politics that grew up in the twenty tens
Speaker 8: and used these tools to their fullest extent. In some sense,
Speaker 8: the election of Donald Trump is then the real culmination
Speaker 8: of all of it.
Speaker 3: No, I think that's true.
Speaker 1: So what do you see us bringing about the end
Speaker 1: of that era? And what media era do you think
Speaker 1: that we are living in or entering now?
Speaker 5: Yeah?
Speaker 8: I mean I wish I knew with total clarity, but
Speaker 8: I you know, I think ultimately it's always going to
Speaker 8: be I mean, these aren't machines.
Speaker 5: It's ultimately the consumers.
Speaker 8: People get sick of it, and I think the same
Speaker 8: way people were sick of the old media twenty and four.
Speaker 8: By twenty sixteen twenty seventeen, the notion that wow, you
Speaker 8: can just go on Facebook and like hear from everyone
Speaker 8: and you can get cat pictures and thoughtful articles and
Speaker 8: insane politics like all in one place no longer felt
Speaker 8: so fun and interesting and people, I think, I mean,
Speaker 8: I feel very disoriented looking at social media now, and
Speaker 8: it's not a great experience for telling you, like, hey,
Speaker 8: what is happening in the world actually, And so I
Speaker 8: think there has been this swing of the pendulum in
Speaker 8: reaction essentially toward you know, in particular kind of trusted institution,
Speaker 8: individual voices. I think it's people are, for whatever reason,
Speaker 8: across different areas a little less connected to brands and
Speaker 8: more to people. But I think that's, you know why
Speaker 8: the kind of stuff you guys do is very successful,
Speaker 8: one of the one of the many reasons co but
Speaker 8: looking for people who can help synthesize this flood of
Speaker 8: information and organize it and not just and I think
Speaker 8: you know, it's it's and and of course like that's
Speaker 8: our bad at Semaphore that that you know that people
Speaker 8: are looking for kind of human transparency and the journalism.
Speaker 8: For me to say here's what I found, here's my opinion.
Speaker 8: But you know, there's room for someone reasonable to disagree
Speaker 8: with me and then also to do the service of
Speaker 8: trying to bring in voices from all over I mean,
Speaker 8: and not just feed you our own perspective.
Speaker 2: Yeah, I think I think it's very important for people
Speaker 2: to understand, which is that a certain point, like there's
Speaker 2: so much information out there that help making helping people
Speaker 2: make sense of all of it is actually you know,
Speaker 2: where a lot of the news business has gone. But
Speaker 2: something you always have emphasized and that we always keep
Speaker 2: in the back of our minds too, is, at the
Speaker 2: end the same time, though nothing does beat new information,
Speaker 2: nothing does beat scoop.
Speaker 3: So whenever you look at this fusion of like new and.
Speaker 2: Old journalism, what do you think like a happy medium
Speaker 2: looks like for the future media companies like yours, like
Speaker 2: ours and all the others wants to come.
Speaker 8: I mean, I think we're headed into a much more
Speaker 8: splintered universe where the thing is, like the crazy thing
Speaker 8: about the Facebook and Twitter era was there were just
Speaker 8: these two giant platforms that totally dominated the news business
Speaker 8: and everyone, every journalist in some sense or most of
Speaker 8: them were thinking about them, and not only people were
Speaker 8: also thinking about like, you know, making broadcast television shows.
Speaker 8: But those two platforms dominated. I don't think we're I
Speaker 8: don't think I really see that even now. I don't
Speaker 8: think those two platforms are as dominant anywhere near as
Speaker 8: they were. And so you're looking at a much more splintered,
Speaker 8: diverse landscape without sort of this is the single trick
Speaker 8: that will you know, succeed.
Speaker 1: Yeah, And what do you see as the sort of
Speaker 1: current state of Twitter in particular, which for so long
Speaker 1: has been such a you know, shaper of elite discourse
Speaker 1: in particular, and was at times, and we really leaned
Speaker 1: heavily and still do on Twitter to surface stories for
Speaker 1: our show. But I'm finding personally I rely on it
Speaker 1: less and less. It's just, you know, it's not like
Speaker 1: an ideological anti eline thing. I just find it less
Speaker 1: useful these days. Do you think that that is the case.
Speaker 1: Do you think that Twitter and other social media platforms
Speaker 1: are actually going to become less important in terms of
Speaker 1: the news media business.
Speaker 8: And they've obviously have become less important, And that's right,
Speaker 8: partly because it used to just do this very useful
Speaker 8: thing of when you wanted to know what was happening,
Speaker 8: you could look at Twitter and it would tell you
Speaker 8: here's what is happening in the world, right, And now
Speaker 8: you look at Twitter and you just know what is
Speaker 8: happening on Twitter, which I find riveting as a long
Speaker 8: time Twitter user, and it's fun and weird.
Speaker 5: But you know, but I have to go somewhere else
Speaker 5: if I want to know what the news is.
Speaker 8: And so I think, you know, I think Elon has
Speaker 8: made mistakes and has kind of has sent like an
Speaker 8: ideology about how the news media works that isn't really
Speaker 8: connected to reality, but also that it was probably doomed
Speaker 8: like that. These social platforms are fundamentally these social institutions
Speaker 8: that get cool and then that people get sick of
Speaker 8: and you're mostly there because your friends are there, and
Speaker 8: then they leave and you leave. And doesn't mean these
Speaker 8: doesn't mean that Twitter and Facebook won't exist in ten years, right.
Speaker 8: I mean, I think Reddit is a great example of
Speaker 8: a social platform that you know, is great and is
Speaker 8: incredibly powerful and fun and interesting and I go on
Speaker 8: many days of the week, but isn't culturally central, isn't
Speaker 8: central to news and politics.
Speaker 2: Yeah, I think that's all really smart I encourage everybody
Speaker 2: to go buy the book. We all the linked down
Speaker 2: in the description of this video. Ben really appreciate you joining.
Speaker 1: Us, sir. Thanks for your time. Ben, good to see you.
Speaker 5: Thank you for having me.
Speaker 2: Guys, absolutely all right, guys, thank you so much for watching.
Speaker 2: We really appreciate it. Thank you as always to all
Speaker 2: the monthly, yearly lifetime memory signing up. We love you all,
Speaker 2: every single person. You're all equal in the eyes of
Speaker 2: Breaking Points and the community, just because you are all
Speaker 2: contributing and helping us scale up. So much of the
Speaker 2: discussion that we all just talked about is a big
Speaker 2: reminder to me and on vindication honestly of our strategy.
Speaker 2: You know, we have not taken on one scrap of
Speaker 2: business debt here. Everything is financed through a cash flow process, exclusively,
Speaker 2: almost entirely by our premium subscribers. A lot of the
Speaker 2: buzzfeeds and all these people they raised billions of dollars.
Speaker 3: They had bosses who were not their own body.
Speaker 2: I don't know if anybody's taking notice of what's going
Speaker 2: on right now over at barstool.
Speaker 1: Where I saw something. What is going on?
Speaker 3: All right, let's spend some time, maybe we'll clip this out.
Speaker 2: Let's let's clip this out seper segment on this because
Speaker 2: this is actually a very vindicating I think for a
Speaker 2: lot of my theories and our theories around how to
Speaker 2: run him at the company. So Barstool had this guy
Speaker 2: who worked for them, and he was on the air
Speaker 2: and he was singing along to a rap song because
Speaker 2: he had the lyrics. He had the lyrics that were
Speaker 2: in front of him. One of the words that he
Speaker 2: rapped on the air was the N word. Okay, so
Speaker 2: he did that. He turned wide as a sheet. He
Speaker 2: clearly was deeply apologetic about it. He said, I shouldn't
Speaker 2: have done He's been very apologetic. Barstool then is owned
Speaker 2: or currently is owned by a larger company called pen
Speaker 2: Gaming and the gambling institution.
Speaker 3: Barstool did not want to fire him. They want to
Speaker 3: discipline him whatever.
Speaker 2: Pen Gaming, the top company came in over the top
Speaker 2: and overruled both the CEO of Barstool and Dave Portnoy
Speaker 2: and said, no, we're going to fire this guy.
Speaker 3: He's literally getting and as part of the talent.
Speaker 2: Now, whether you agree on whether you should be fired
Speaker 2: or I personally don't think you should be fired, Whether
Speaker 2: you agree or not. The fact is is that the
Speaker 2: people who run the company didn't want to fire him,
Speaker 2: but because they sold the company, they don't have control
Speaker 2: over their own employees. And now there's this whole split
Speaker 2: in the barstool community. And it's very messy because you
Speaker 2: have Dave Portnoy openly saying I did not want to
Speaker 2: fire one of my own employees, and at the same time,
Speaker 2: you have people who work at Barstool who are like,
Speaker 2: I don't agree with this from my bosses. You have
Speaker 2: Barstool fans who are all like part of the cold
Speaker 2: not in my barstool moment. They're like, I ride or
Speaker 2: die for Barstool because I don't agree, you know, with
Speaker 2: so much of the mainstream culture. Now Portnoy is like,
Speaker 2: I'm going to stop selling the cancel Cancel culture.
Speaker 3: Sweatch.
Speaker 2: It's just a messy situation, and it's one of those where, yeah,
Speaker 2: you know, at the end of the day, and at
Speaker 2: least he was honest. People were like, you're a sellout.
Speaker 2: He's like, yeah, I sold it, sold for the cast.
Speaker 2: But that's a really cautionary tale.
Speaker 1: Where reminds me of the eight exactly. Yeah, because we
Speaker 1: talked about this before but as but Nate Silver said,
Speaker 1: as your client another twenty ten's personality. But Nate Silver
Speaker 1: out at his own baby five thirty eight. Why because
Speaker 1: he sold it's created me, that's his thing, like that
Speaker 1: real brand. Anyway, we will not do that.
Speaker 2: It's a caution just to show people like listen, you
Speaker 2: know you it's a deal with the devil in any respect. Sure,
Speaker 2: you know Portnoy it did certainly well. Many people there
Speaker 2: also did well. But the core of the brand was
Speaker 2: about dudes online shit posting, going against the culture. And
Speaker 2: it's like whenever you sell you know, even to and
Speaker 2: by the way, the claim is, since we're going.
Speaker 3: To do a segment on this and this is gonna
Speaker 3: be posted.
Speaker 2: The claim is that pen gaming would have faced regulatory
Speaker 2: pressure by gambling regulators. Come on that what look maybe
Speaker 2: no personally what bullshit?
Speaker 3: No, that's deplete bullshit.
Speaker 2: So you're one subsidiary employee company made a mistake and
Speaker 2: said something which look, you know, discipline whatever. Okay, but
Speaker 2: the idea that if he still remains with the employee
Speaker 2: of the company, that you were going to get lose
Speaker 2: your regulatory license, not just in one state, but like
Speaker 2: all states.
Speaker 3: I don't. I don't believe that for a second.
Speaker 1: That's that is nonsense. I mean, look, if you want
Speaker 1: to fire the guy they just fired, it goes. Don't
Speaker 1: use to what we were saying about Tucker Carlson, number
Speaker 1: one rated the news host when they're like, you're gonna
Speaker 1: wear a sweater, right, yeah, he wore the sweater.
Speaker 3: That's the point.
Speaker 1: That's it right there, That is it right there.
Speaker 2: That is why we ask people just so you know,
Speaker 2: for premium subscriptions because we're not.
Speaker 3: Going to be in this issue.
Speaker 1: We will not do that.
Speaker 3: You know, We're not going to be where.
Speaker 2: Somebody you will wear the sweater, yeah, or somebody's gonna
Speaker 2: tell us what to wear, or somebody's gonna tell me. Listen,
Speaker 2: we fire somebody's because they deserve to get fired, not
Speaker 2: because somebody's going to tell me that they.
Speaker 3: Need to get fired.
Speaker 2: And that is where you look at that and they're
Speaker 2: real perils. So one of the things that we are
Speaker 2: committed to here is making it so that you are
Speaker 2: the people who help fund and support all of our
Speaker 2: work here. And we will if we have to scale slower,
Speaker 2: so be it, because ain't nothing in the world is worth.
Speaker 3: Somebody telling you how to run your own affairs.
Speaker 1: Keep the overhead low, build step by step like we
Speaker 1: have been, and rely on your support, which you guys
Speaker 1: have come through in amazing way. Programming Note I will
Speaker 1: be out next week.
Speaker 3: Yes that's right. Everybody's say congratulating married this.
Speaker 1: Weegain, So I'll be out for next week. But Ryan
Speaker 1: Graham will be in this chair and we'll do a
Speaker 1: fantastic jobs.
Speaker 3: We'll hold down the four for all of you, and
Speaker 3: we will see you all later