Speaker 1: Hello, They're Happy Thursday. Welcome to another episode of the
Speaker 1: Chuck Podcast. Got a terrific guest today, the former chair
Speaker 1: of the FTC Federal Trade Commission, Lena kah is going
Speaker 1: to join me for a conversation about sort of consumer
Speaker 1: protection in the age of in this age of AI
Speaker 1: big tech corporate consolidation, the fact that she was one
Speaker 1: of the few Biden appointees that had a fan base
Speaker 1: on the right as well as on the left. And
Speaker 1: I hope it's both one part education about what exactly
Speaker 1: the FTC should and can do, and one part sort
Speaker 1: of warning, if you will, about about the things that
Speaker 1: the government should be doing but hasn't been able to do.
Speaker 1: I of course believe we're in a moment here not
Speaker 1: dissimilar to the moment Teddy Roosevelt face miss the original Trustbuster,
Speaker 1: if you will, And we're in a similar period, right,
Speaker 1: the rise of the robber barons, the rise of the prologarts.
Speaker 1: So I really have been looking forward to this interview.
Speaker 1: I enjoyed it. I hope you will too. But before
Speaker 1: we get to it, this was kind of Look, we
Speaker 1: have plenty of days where we say wow, this was
Speaker 1: kind of a crazy day. In the Trump era. And
Speaker 1: you know, if you just's you could probably say about
Speaker 1: half the days, you could say this is kind of
Speaker 1: a crazy day in the Trump era. But we were
Speaker 1: felt as if the morning began. I'm speaking to you
Speaker 1: now it's Wednesday evening on July sixteenth, but this day
Speaker 1: began on Wednesday, July sixteenth, where we thought we were
Speaker 1: about to cover a story. Is the President of the
Speaker 1: United States going to fire the chairman of the Federal
Speaker 1: Reserve as a way to turn the page on the
Speaker 1: Jeffrey Epstein scandal. And that's exactly what it seemed to
Speaker 1: be what was building. There was a leak of this
Speaker 1: meeting that he had, and I've been in the room
Speaker 1: when Donald Trump has shown letters. Look, I've got a
Speaker 1: firing letter. I had a bizarre heads up about his
Speaker 1: indecision to fire people at one point and had an
Speaker 1: interesting off the record with him before a firing when
Speaker 1: he was asking for the opinions. You know, I've come
Speaker 1: up with this letter saying I'm going to fire so
Speaker 1: and so and so. He did it. This is not
Speaker 1: a new thing for him. This is sort of how
Speaker 1: he operates. He'll get somebody will put me, get me
Speaker 1: a release, give me a letter, I'm going to fire somebody.
Speaker 1: So apparently you had this letter together. Whether he's going
Speaker 1: to fire Jerome Powell. Clearly they've and I told you
Speaker 1: about this on Monday. I said, this is a story
Speaker 1: that should be getting more attention, And boy did it
Speaker 1: start getting attention, because it was clear something was afoot
Speaker 1: where in order to get around the question about whether
Speaker 1: the President had the power to fire the chairman of
Speaker 1: the Federal Reserve. I couldn't fire him over a policy dispute.
Speaker 1: That was pretty clear. The Supreme Court seemed to make
Speaker 1: that clear to him, even as they've given him a
Speaker 1: green light to fire, to have a more executive authority
Speaker 1: on to hire and fire. The loophole they were developing
Speaker 1: was all about, well, he's overseeing this renovation of the
Speaker 1: Federal Reserves headquarters in Washington. There are cost overruns, and
Speaker 1: the president did they believe they did have the legal
Speaker 1: authority to fire him early on that so it looked
Speaker 1: like they were manufacturing this authority. Well, of course, what
Speaker 1: did the market. The markets had something to say to him.
Speaker 1: The markets started awfully on Wednesday morning, and then of
Speaker 1: course by noon he's backed off. But it does feel
Speaker 1: as if you can't help but wonder. And I'm going
Speaker 1: to use the words of my friendly and Caldwell over
Speaker 1: at PAK where she said many Republicans she was talking
Speaker 1: to over the past few days had predicted that Trump
Speaker 1: was going to do something pretty dramatic in order to
Speaker 1: distract from and that the anti Powell letter that he
Speaker 1: produced was part of that idea that maybe feeding that
Speaker 1: to his base could distract him. But I think he's
Speaker 1: finding out now that this story is not not going
Speaker 1: away at all, and he decided to light the fuse, right,
Speaker 1: and the fuse that he lit is he attacked his
Speaker 1: own supporters on this story, and he attacked them in
Speaker 1: a way that I've always wondered what happens. He attacked
Speaker 1: him in a way frankly that mainstream media and the
Speaker 1: left has attacked his supporters at time, like you guys
Speaker 1: are idiots. You're being duked, and that is usually not
Speaker 1: a good way. You know, nobody is going when you
Speaker 1: tell somebody they've been duped, Right, there's an expression it
Speaker 1: is easier to con somebody than it is to convince
Speaker 1: somebody they've been conned. Well, here's what he wrote. This
Speaker 1: is this morning is truth. So the radical left Democrats
Speaker 1: have hit payder again, just like the fake and fully
Speaker 1: credited Steele docia, the lying fifty one intelligence agents, the
Speaker 1: Laptop from Hell, which the Dems swore had come from Russia, No,
Speaker 1: it came from Hunter Biden's bathroom, and even the Russia
Speaker 1: Russia Russia scam itself, a totally fake and made up
Speaker 1: story used in order to hide crooked Hillary Clinton's big
Speaker 1: loss in the twenty sixteen election. These scams and hoaxes
Speaker 1: are all the Democrats are good at. They are no
Speaker 1: good at governing. Also, unlike Republicans, they stick together like
Speaker 1: glu Actually that's not true. I'm going to have a
Speaker 1: little comment about that with Hunter Biden, and I don't
Speaker 1: they got a Biden agrees with them on that. Their
Speaker 1: new scam, he writes, is what we will forever call
Speaker 1: the Jeffrey Epstein hoax. And my past supporters have brought
Speaker 1: into this bullshit, hook line and sinker. They haven't learned
Speaker 1: their lesson and probably never will, even after being conned
Speaker 1: by the lunatic left for eight long years. Actually, his
Speaker 1: supporters weren't cone by the left because they've stuck by him.
Speaker 1: But anyway, but I digress. I've had more success than
Speaker 1: six months than perhaps any president in our country's history.
Speaker 1: And all these people want to talk about with strong
Speaker 1: prodding by the fake news, and the success star of
Speaker 1: Dems is the Jeff free Epstein hoax. Let these weaklings
Speaker 1: continue forward and do the Democrats work. Don't even think
Speaker 1: about talking of our incredible and unprecedented success because I
Speaker 1: don't want their support anymore. Thank you for your attention
Speaker 1: to this matter. Make America great again. Well to say
Speaker 1: that that went down that that didn't go down well
Speaker 1: with his supporters is an understatement. And look, he is behaving.
Speaker 1: What's interesting here The word hoax is an incredibly important
Speaker 1: word that he used here because hoax is the word
Speaker 1: that he always attached to Russia, and hoax is in
Speaker 1: some ways, you know, I would say it's Trump speak
Speaker 1: for I have no other explanations for my weird behavior. Right.
Speaker 1: You know, one of the hallmarks of the twenty sixteen
Speaker 1: Russia scandal was it was it was clear Russia was infiltrating,
Speaker 1: you know, was trying to you know, manipulate our our
Speaker 1: political conversation or discourse, or I mean that's been proven. Right,
Speaker 1: the Justice Department charged a group out of Russia. Sanctions
Speaker 1: were had like this is this is not in dispute.
Speaker 1: Marco Rubio signed on to an investigation. The current Secretary
Speaker 1: of State for Donald Trump signed on to an investigation
Speaker 1: by the Senate that also, that is not in dispute.
Speaker 1: The Russian government wanted to get involved, disrupted our election
Speaker 1: in any way they thought they could, and yes, they
Speaker 1: had a preference, and their preference they wanted Trump, not Clint. Now,
Speaker 1: of course, what's in dispute was whether the Trump campaign
Speaker 1: was colluding with the Russians to do this, or whether
Speaker 1: they were just happily accepting the help the way you
Speaker 1: might accept help from a surrogate or a labor union
Speaker 1: or some other outside group, no different than the Koch
Speaker 1: brothers paying for advertising to help the Republican ticket. This
Speaker 1: was just, oh, the enemy of my enemy is my
Speaker 1: ally and Trump's. But it was Trump's person behavior about
Speaker 1: it that actually brought on more suspicion, and in fact,
Speaker 1: there's something very similar is happening here. John chap who's
Speaker 1: now The Atlantic, formerly of New York Magazine. He writes
Speaker 1: this se because sometimes people sound guilty even if they aren't,
Speaker 1: especially if their government officials still, whatever probability you had
Speaker 1: in your mind that the Epstein files contained damaging material,
Speaker 1: you should probably raise it after listening to Trump's remarks
Speaker 1: on the subject. And that's the thing, right, It's the
Speaker 1: same thing that happened with the Russian investigation. The more
Speaker 1: he said things like, hey, Russia, if you're listening, you know,
Speaker 1: the more he would talk about how much he loved
Speaker 1: the wiki leagues and how much he seemed his campaign
Speaker 1: appeared to be at least either really nimble for when
Speaker 1: there were new wikileague releases or sometime Hoow got a
Speaker 1: heads up and look like they were coordinating. Now, perhaps
Speaker 1: they just it was Julianasan who was very helpful to
Speaker 1: the Trump campaign, and it had nothing to do with
Speaker 1: the Russians. I think there's a lot of I think
Speaker 1: it is a reasonable conclusion that Trump didn't collude with
Speaker 1: the Russians. But at the same time, he didn't mind
Speaker 1: getting their help. Uh, and a lot of a lot
Speaker 1: of folks didn't mind it, and didn't certainly didn't tell
Speaker 1: them to stop, and certainly didn't you know, there was
Speaker 1: one of the great uh, one of the weirder scandal
Speaker 1: near scandals of the two thousand election. I'm gonna do
Speaker 1: a little diversionary history lesson here Al Gore, George W. Bush.
Speaker 1: Al Gore gets mailed a videotape of George W. Bush's
Speaker 1: debate prep and they don't understand and it clearly came
Speaker 1: from some staffer, uh in, you know, the Bush's media consultants.
Speaker 1: Mark McKinnon's firm had never really worked with Republicans before
Speaker 1: working with with with Bush. So there was some speculation
Speaker 1: that there was some sort of cranky Democratic staffers working
Speaker 1: on behalf of McKennon and Bush that may have may
Speaker 1: have done this. Well, the Gore campaign was petrified, thought
Speaker 1: they were being framed, and they went directly to the
Speaker 1: FBI right and it basically became a nothing burger. Donald
Speaker 1: Trump didn't actually go, you know whatever, they knew what
Speaker 1: the Russians were, They didn't go running to the FBI going, hey,
Speaker 1: look we are worried the Russians are doing this. You know,
Speaker 1: John McCain and Barack Obama's campaign were hacked in eight
Speaker 1: and they took that dispute and they made sure law
Speaker 1: enforcement knew before it ever went public. So my point
Speaker 1: is is that it's pretty clear Donald Trump had no
Speaker 1: interest in alerting law enforcement, had that something that was
Speaker 1: benefiting their campaign. But hey, this isn't on the up
Speaker 1: and up. That ain't the way Donald Trump acts, thanks behaves,
Speaker 1: et cetera. So my point is that I think it's
Speaker 1: certainly plausible that two things can be true at the
Speaker 1: same time. Right, And of course, you know, Trump the
Speaker 1: advantage of the Steele dosia at the time is what
Speaker 1: Trump was so successful at doing is if you can
Speaker 1: discredit the steel dosier, you know, then it makes it
Speaker 1: easier to discredit everything else. And then still does say
Speaker 1: there was enough there that they could plausibly discredit the
Speaker 1: story of Michael Cohen going to the Prague and the
Speaker 1: whole you know, Ppe tape business that it turned out
Speaker 1: like you know, I'm one of those that if if
Speaker 1: it existed, it'd be out already. So it's it's likely
Speaker 1: that this was and it's possible Christopher Steele was being
Speaker 1: played by other Russians in that that all of this
Speaker 1: was a mess there. But let me come back to Epstein, right,
Speaker 1: which is, you know, I don't think a lot of
Speaker 1: people Again, you go back to Trump's relationship, and it
Speaker 1: was something I talked about before that I'm going to
Speaker 1: go back. The most plausible explanation is yet a whole
Speaker 1: bunch of rich people who had no problem taking free
Speaker 1: plane rides with Jeffrey Epstein, free stuff from him, no,
Speaker 1: you know, and knew who he was, always had the
Speaker 1: you know, Donald Trump is on the record talking about
Speaker 1: how young Jeffrey liked them, and they didn't look the
Speaker 1: other way, right, or they just chose to look the
Speaker 1: other way. It didn't bob, you know, because that's how
Speaker 1: much they wanted the free airplane. And this so called
Speaker 1: client list is. And again I go back to the government.
Speaker 1: If they have you cannot do what they what what
Speaker 1: some of these folks want, release everybody that may have
Speaker 1: been associated with him, which may simply be were you
Speaker 1: on the air and an airplane with him at any
Speaker 1: one time? And of course people are going to take
Speaker 1: that and assume if you were ever on an airplane,
Speaker 1: you're a ped You're you're a pedophile too, right, And
Speaker 1: that's where and this is so the question is is
Speaker 1: that what Trump's afraid of? But now the more that
Speaker 1: he digs in his heels, the more he digs in
Speaker 1: his heels, the more he digs in his heels, and
Speaker 1: now it's like, you know, I'm not going to sit
Speaker 1: here and say I believe that he was doing the
Speaker 1: same things Jeffrey was doing Jeffrey Epstein was doing. But
Speaker 1: the more the more defiant he sounds, the more he
Speaker 1: digs in his heels, and the more he attacks his
Speaker 1: own supporters, the more clearly it's going to raise questions.
Speaker 1: Now let's go back to why is he having a
Speaker 1: hard time. Normally he can just tell his supporters, you know,
Speaker 1: do his own Jedi my trick. These aren't the hoaxes
Speaker 1: you're looking for. Pay no attention. Oh these ass isn't
Speaker 1: the hoax we're looking for. You know, this work done?
Speaker 1: Fox News? Oh hey, don't pay any attention to Jeffrey Epstein,
Speaker 1: got it? And Fox News salutes the flag. They don't
Speaker 1: cover anything in the Jeffrey Epstein story. Charlie Kirk said,
Speaker 1: you know, when Trump said he was done with it,
Speaker 1: Charlie Kirk then saluted the flag, said he's done with it.
Speaker 1: Then he got attacked for that, then he came back.
Speaker 1: So he's kind of a mess, right, But there's a
Speaker 1: reason why. And again I go back to I go
Speaker 1: back to the point of the hardest thing to do
Speaker 1: is it is harder to give in somebody they've been
Speaker 1: conned than to actually con them. And that's where we are.
Speaker 1: And you've got to understand the importance of Jeffrey Epstein,
Speaker 1: and the best way to understand it is in this
Speaker 1: fascinating retort. So Donald Trump drops that explosive truth social
Speaker 1: post telling anybody on his that supposedly is in MAGA
Speaker 1: that believes the Jeffrey Epstein hoax, I don't want your
Speaker 1: support anymore. You're just doing the bidding of the Democrats. Well,
Speaker 1: the sort of the the unofficial pope of the pedophile
Speaker 1: conspiracies is now Michael Flynn, the disgraced former general retired
Speaker 1: general that was the National Security Advisor for about I believe,
Speaker 1: I believe for about two Scaramucies, right. I think it
Speaker 1: was twenty two days he survived. Scaramuccie is eleven days.
Speaker 1: If I'm not mistaken. I hope I have that right.
Speaker 1: Anthony will let me know if I've gotten that wrong.
Speaker 1: So I think Flynn was two Scaramucies in office there,
Speaker 1: and he went real deep into QAnon, to the point
Speaker 1: where it's almost like he decided whether if no one
Speaker 1: knows who Q is, I'll let people think it is me.
Speaker 1: So anyway, you have to understand this. So he writes
Speaker 1: this very long post on X and he's directed at
Speaker 1: Donald Trump. Let me read a portion of it. He
Speaker 1: says to Donald Trump, I hesitated to write this, however,
Speaker 1: with the utmost respect and deference to you for all
Speaker 1: you've withstood. If you know it better than me, what
Speaker 1: the deep state can do when they want to turn
Speaker 1: on a person. The Epstein affair is not about who
Speaker 1: killed him or if he committed suicide. Personally, I'm glad
Speaker 1: this known pedophile is debt, but neither is this a hoax.
Speaker 1: This issue goes beyond that. Michael Flynn writes, there are
Speaker 1: millions of Americans who overwhelmingly voted for you to be
Speaker 1: our president, and we want you to be massively successful,
Speaker 1: no more than me personally. I still have a target
Speaker 1: on my forehead. Our country is facing a level of
Speaker 1: internal subversion, and it is a relentless attack on the
Speaker 1: very foundation for constitutional republic. So he is knee deep
Speaker 1: in this belief that there are these hidden forces coming
Speaker 1: after him. All right, He's really and the question is,
Speaker 1: does he really believe it, or is this just a
Speaker 1: giant grift because it bailed him out of financial trouble.
Speaker 1: I certainly assume it's a financial grift. But we'll see,
Speaker 1: he continues. I'm not going to read the whole thing,
Speaker 1: but he continues here at the end, because this is
Speaker 1: part's important, he says. An element that is of great
Speaker 1: importance surrounding this Epstein affairs the fact that this man
Speaker 1: was a known pedophile, had a list of clients who
Speaker 1: represented the upper crust of society and likely did untowards
Speaker 1: things to children on his island, in his homes in
Speaker 1: New York City and New Mexico and maybe elsewhere, and
Speaker 1: he was convicted of it. I want to single out
Speaker 1: the word pedophilia here a minute, so as you know,
Speaker 1: the entire QAnon bizarreness is sort of the importance of
Speaker 1: believing your political opponents or pedophiles is important in the
Speaker 1: whole dehumanization process. Right. This is I think at the
Speaker 1: heart of this of this unfortunate climate that we're all
Speaker 1: living in right now. And it's it's harsher, of course
Speaker 1: online than it is in real life, but it's had
Speaker 1: some real life consequences, right that this gentleman that really
Speaker 1: thought there was some sort of you know, kids being
Speaker 1: held captive in the basement of a pizza shop in Washington,
Speaker 1: d C. He shows up and there is no basement,
Speaker 1: nothing is there, And he was about to possibly kill
Speaker 1: a whole bunch of innocent patrons and the owner of
Speaker 1: of of a pizza shop in Washington, d C. But
Speaker 1: Jeffrey Epstein doing what he did, he's sort of like
Speaker 1: the Kevin six degrees of Kevin Bacon game for these
Speaker 1: for this, for this crazy conspiracy theory, once you have
Speaker 1: bought in that the Left is not just against you culturally,
Speaker 1: but is against you because they're a cabal of pedophiles.
Speaker 1: And again, this is this is what this crowd is believing.
Speaker 1: This is where Marjorie Taylor Green gets her gets her
Speaker 1: energy from. This is Michael Flynn, this is this, This
Speaker 1: is this world. This is how Dan Bongino made a
Speaker 1: fortune uh uh conning these people with his media. And
Speaker 1: all of a sudden, if Donald Trump is saying that
Speaker 1: Jeffrey Epstein story is a hoax, it shatters the entire
Speaker 1: conspiracy that was built up. It's sort of like it's
Speaker 1: like it's it's an extraordinary It's like knocking down a
Speaker 1: foundation pillar. Right if you have a house on stilts,
Speaker 1: and if you get the right one, you know, or
Speaker 1: if you're in Jenga, it's like if you pull the
Speaker 1: wrong leg, everything collapses. And if if Jeffrey Epstein is
Speaker 1: not proven to have been the sort of the chief
Speaker 1: recruiter of victor of young kids to feed this pediph
Speaker 1: this manufactured pedophilia, uh uh ring that that this conspiracy
Speaker 1: supposedly has cocked it and supposedly exists. You need the
Speaker 1: Jeffrey Epstein story right because Jeffrey Epstein put a face
Speaker 1: to it. Jeffrey Epstein may actually be a pedophile. Jeffrey
Speaker 1: Epstein knew all these famous people right now? Does that
Speaker 1: mean just because he knew these famous people, does that
Speaker 1: mean all of them are now this well? To Michael Flynn,
Speaker 1: it is right now, Whether again I go back, I
Speaker 1: don't know whether Michael Flynn really believes this now or
Speaker 1: whether this has just been so financially lucrative for him
Speaker 1: to be the face of this of this crowd that
Speaker 1: he has as the high unofficial high priest of the
Speaker 1: QAnon crowd and believers of this conspiracy, he had to
Speaker 1: push back or his financial empire would crump. So this
Speaker 1: is the part where you send up. You end up
Speaker 1: finding out does Donald Trump fully understand his base? Right?
Speaker 1: There's sort of and there's always been two distinct bases
Speaker 1: with tru. There's the actual working class space, the ones
Speaker 1: that demographically are non the non college educated crowd, the
Speaker 1: people that you know, the different people that shower at night,
Speaker 1: shower after work versus showering before work. Right, that's sort
Speaker 1: of like do you shower, do you shower when you
Speaker 1: come home for work, or do you shower before you
Speaker 1: go to work? Right? That that sort of blue collar,
Speaker 1: white collar mindset. And then there's the crazy conspiracy theorists.
Speaker 1: And Donald Trump fed those conspiracy theorists. Right, he has
Speaker 1: built his entire political profile on a conspiracy theory. It
Speaker 1: began with burtherism. Right. How did he how did he
Speaker 1: convince the anti Obama right, the ones that were the
Speaker 1: most vocal who decided not to oppose Obama on policy
Speaker 1: but simply oppose him whether on otherism, right, the fact
Speaker 1: is he a real American? And questioning whether he was
Speaker 1: an American? Trump, of course rode that wave of conspiracy theory,
Speaker 1: and so one of his habits is this comes back
Speaker 1: to what he did with David Duke. Right, Why couldn't
Speaker 1: he immediately denounce David Duke because David Duke sent something
Speaker 1: nice about him? Why couldn't he immediately denounce Vladimir Putin
Speaker 1: because Putin said something nice about him? So he is
Speaker 1: sort of catered, right. He appeases this crowd of conspiracy theorists,
Speaker 1: and he'll feed him every once in a while. Right,
Speaker 1: He'll feed the velociraptor every once in a while, And
Speaker 1: suddenly the velociraptor has a taste for this and has
Speaker 1: a taste for this. And of course they've kept feeding
Speaker 1: and feeding and feeding until they caught the car. They
Speaker 1: run the government, the head some of the lead characters
Speaker 1: pushing the conspiracy theory are actually in now the deep
Speaker 1: state themselves, Dan Bongino and Cash Patel and Pam Bondi
Speaker 1: got into it as she's been trying to debushify herself
Speaker 1: and retrumpify her self, if you will. And here they are.
Speaker 1: And so whatever the truth is, and I you know,
Speaker 1: I'm still one of those who believes that what they
Speaker 1: have they don't if they had evidence that somebody else
Speaker 1: committed a crime on Jeffrey Epstein's island, they would have
Speaker 1: brought the charges. Okay, this idea that charges wouldn't have
Speaker 1: been brought, I just you know, I under I understand.
Speaker 1: You know, nobody wants to get in the way of
Speaker 1: a good conspiracy theory. The conspiracy theories are always more
Speaker 1: interesting than the truth. But when you've spent twelve years
Speaker 1: torching institutions, torching those who were trying to speak the truth,
Speaker 1: and then you're in charge of set organization and then
Speaker 1: you're like, you can't believe they don't believe you, and
Speaker 1: it's like, well, you know, you reap whatt yourself. So
Speaker 1: but I do think to truly understand why Trump did.
Speaker 1: I don't think full appreciates how important Jeffrey Epstein is
Speaker 1: as a connective tissue to this weird Like I said,
Speaker 1: one of the dehumanization tactics of the right has been
Speaker 1: to manufacture this pedophilia business. And so it is it
Speaker 1: is that is the long tail of crazy here that
Speaker 1: has brought Epstein into this sort of swirl, if you will,
Speaker 1: And why it is so important for this crowd that
Speaker 1: you know, the proof of Epstein's guilt Seeing this is
Speaker 1: sort of it will become. It is this idea that hey,
Speaker 1: we're not crazy. See we're right, We're right, We're right.
Speaker 1: There was a pedophile ring. You know, we kept telling
Speaker 1: you there was one, and here it is. And if
Speaker 1: it's not there, you know, for some of these people,
Speaker 1: if they're true believers, it it becomes a oh my god.
Speaker 1: You know, this could be the moment that they maybe
Speaker 1: feel cond I'll say this. You know, we've all wondered
Speaker 1: when you know the Trump err is going to end
Speaker 1: at some point, does it end with a whimper? Does
Speaker 1: it end with a loud bang? Does it end you know?
Speaker 1: I don't you know, I don't think any of us
Speaker 1: believe it's going to It was going to end with
Speaker 1: a rousing closing argument in some sort of courtroom, you know.
Speaker 1: And there was a lot of prosecutors that dreamed of
Speaker 1: that they were somehow going to be a TV lawyer
Speaker 1: and be portrayed in a TV movie someday, that they
Speaker 1: were going to get him right. It was never going
Speaker 1: to end this way. It always was going to end
Speaker 1: when he got exposed for being a hypocrite, right and
Speaker 1: for for duping his own people. I think a lot
Speaker 1: of us thought it, but still believe it will be
Speaker 1: when it hits their own pocketbook, when they realized the
Speaker 1: policies that he's advocating are a disaster and they're going
Speaker 1: to be economically punishing here in a few months. Unfortunately.
Speaker 1: I really hope, uh you know, I mean, look, you know,
Speaker 1: buried in this sort of story to end about him
Speaker 1: toying with firing Jay Powell, which clearly doing it feels
Speaker 1: like he was trying to do it as a way
Speaker 1: to distract from Epstein. But the point is he's going
Speaker 1: to get control of the FED in a year no
Speaker 1: matter what. And the fact that we're going to have
Speaker 1: a president who, by the way, is now showing so
Speaker 1: many signs of age, and it is it is, you know,
Speaker 1: whether it's falling asleep at events more often now, whether
Speaker 1: there's you know, he's there's clearly a bunch of medical issues.
Speaker 1: He's not disclosing, you know, what's wrong with his hand.
Speaker 1: We've seen that, you know, there's there's there's something he's
Speaker 1: dealing with, some sort of health issue that they're not disclosing.
Speaker 1: And of course they've so uh scared the press score
Speaker 1: that covers them. It seems like nobody will ask about
Speaker 1: this as directly, you know, and if they do, he
Speaker 1: you know, he chastises him as evil by the way,
Speaker 1: you know, and all this business, this weird use of
Speaker 1: the word evil, which is again ahuman as dehumanization tactic
Speaker 1: in order to give a green light for his supporters
Speaker 1: to treat fellow Americans like they're not American and that
Speaker 1: they're not human. But something is off about him, right,
Speaker 1: He didn't seem to remember that he appointed J. Powell. Now.
Speaker 1: I accept the premise that in his first term he
Speaker 1: let way too many other people influence him that maybe
Speaker 1: now he regrets. I think there's no doubt he was
Speaker 1: on the job training, he did not understand how everything worked,
Speaker 1: and he took a lot of other people's advice, and
Speaker 1: he was surrounded by folks that were more in the
Speaker 1: mainstream than I think many gave credit. I go back,
Speaker 1: you know, Mike Pens and Wrytes prepus stacked that first
Speaker 1: Trump term with a lot of conservative normies, if you will,
Speaker 1: who I think prevented economic calamity before. They couldn't get
Speaker 1: in his way to you know, once COVID hit the crazy,
Speaker 1: you know, there was only so much they could do
Speaker 1: to keep him from from totally messing things up. And
Speaker 1: you know, by the time COVID came, they couldn't stop it,
Speaker 1: and the public reacted as you might expect. So so,
Speaker 1: but the fact that he can't remember that he appointed
Speaker 1: him or that it's not I don't think that's a denial.
Speaker 1: I think that is some weird you know, maybe it's
Speaker 1: cognitive dissonance, but maybe it's something else. But there's definitely
Speaker 1: he is showing just simple signs of age. He tires earlier.
Speaker 1: You can see it. Anytime after four o'clock in the afternoon,
Speaker 1: he seems to fade a little bit. And you can
Speaker 1: just look. I mean even when he if you look
Speaker 1: at his where he was celebrating with the soccer team,
Speaker 1: even the celebration, he just seemed a little off. He
Speaker 1: seemed like he was a little struggling to sort of
Speaker 1: have the energy to be there. So there's definitely you know,
Speaker 1: who knows, they're not never going to say anything, and
Speaker 1: whatever they release is not going to you know, you
Speaker 1: can't take it to the bank. Right We are now
Speaker 1: living in an era where any press release that the
Speaker 1: Trump administration puts out is not factual. You have to
Speaker 1: assume it's not factual at all, and you have to
Speaker 1: figure out, okay, where what's relevant here. It's very it's
Speaker 1: never been harder to be a reporter on any government
Speaker 1: agency because you certainly have to acknowledge whatever you know
Speaker 1: they're there, Uh, you have to acknowledge their point, you know,
Speaker 1: what their response to an article. But sometimes there's you know,
Speaker 1: it's so much cognitive dissonance that it almost makes your story.
Speaker 1: I mean that guy Stephen Chung will say things that
Speaker 1: just are non sequiturs, right, which is the point? Right?
Speaker 1: They almost kind of want because the more the more
Speaker 1: they confuse the story, the harder it is for a
Speaker 1: negative story to stick. So it's a it's a tactic
Speaker 1: and it's been been quite successful one. But but there's something,
Speaker 1: you know, there's something here. I think this is proof
Speaker 1: he doesn't fully understand his own voters. Sometimes he certainly
Speaker 1: doesn't understand what he the monster he has created with
Speaker 1: this mainstreaming so many conspiracies over the last decade. And
Speaker 1: you know, if this is the way it ends, you
Speaker 1: might want to give an applause to the Writer's room
Speaker 1: on this one. Right, it's a it's a more unique
Speaker 1: ending than something that just uh, that just goes out
Speaker 1: with a whimper. But you know this, I don't think
Speaker 1: he gets out of this Epstein debacle unscathed. I think
Speaker 1: at some point his folks this this also has the feel,
Speaker 1: you know, one of the even in the pre Trump era,
Speaker 1: there was always the summer silly season where there'd be
Speaker 1: some summer scandal that would kind of just catch a
Speaker 1: White House sleeping a little bit, but catch them off guard.
Speaker 1: I think they weren't. You know, they've been focused on
Speaker 1: some other things. They didn't really understand how explosive what
Speaker 1: they were dealing with with Epstein. So if you told
Speaker 1: me by September, they're in a different place and this
Speaker 1: is sort of still still percolating, and there's still some
Speaker 1: people that won't forgive them, But it's a smaller cabala
Speaker 1: people that won't surprise me. But the fact is, you know,
Speaker 1: it's it's like Rocky four and the first time he
Speaker 1: made Drago bleed. It bleeds right, it's human. This one's
Speaker 1: drawn blood and Trump. The question is how debilitating politically
Speaker 1: is it going to be? All Right, I've gone on
Speaker 1: long enough with my intro here. I really hope you
Speaker 1: enjoy this conversation with Lena Khan. It was fascinating to me.
Speaker 1: I think you'll learn a lot and hopefully understand even
Speaker 1: better the role of the ft S And joining me
Speaker 1: now is the former head of the f t C
Speaker 1: Federal Trade Commission. The alphabets sometimes folks get confused. Uh,
Speaker 1: it's Lena Khan. Lena, welcome to the Todd Past. Thanks
Speaker 1: for being here, Thanks for having me so before we
Speaker 1: get into some of the nitty gritty of some of
Speaker 1: the work that you left to your successor, and in
Speaker 1: some cases, I'm curious how pleasantly surprised you are that
Speaker 1: some of your work is continuing. Uh, And we will
Speaker 1: get into that. But you were the youngest FTC chair
Speaker 1: and I guess did you know you wanted to be
Speaker 1: the chair of the FTC? And when did you know
Speaker 1: you wanted to do that? And how does one become that?
Speaker 1: I mean literally, for those that you know, trust busting
Speaker 1: and the demand for government regulation is something that's always
Speaker 1: sort of in the ether, but a lot of people
Speaker 1: don't understand how specifically it would work, how the FTC works.
Speaker 1: How did you know you wanted to do this when
Speaker 1: you were younger?
Speaker 2: Yeah, I've had a somewhat unusual path to antitrust and
Speaker 2: consumer protection. I actually always growing up, wanted to be
Speaker 2: a journalist and was really into kind of research and
Speaker 2: reporting and figuring out how to tell stories that are
Speaker 2: kind of holding power to account. I graduated shortly after
Speaker 2: the financial crisis, and so journalism jobs were pretty difficult
Speaker 2: to come by, and ended up landing at a think
Speaker 2: tank and research organization where my job was to document
Speaker 2: the effects of market consolidation. And so I was doing
Speaker 2: a lot of reporting by talking to farmers, say, and
Speaker 2: figuring out, hey, this big merger happened a few years ago,
Speaker 2: what does it look like to be a chicken farmer
Speaker 2: in today's America. I was on book publishing, rental cars, airlines,
Speaker 2: and really saw how over the last few decades, a
Speaker 2: secret trend across the American economy has been increasing consolidation.
Speaker 2: And so whereas decades ago you would have dozens and
Speaker 2: dozens of competitors, increasingly now you just have a small
Speaker 2: number of companies that dominate, be it in meatpacking, be
Speaker 2: it in airlines. If you go to the grocery store,
Speaker 2: it might look like there are dozens of brands, but
Speaker 2: they're actually just owned by a handful of companies, be
Speaker 2: it for diapers or laundry detergent or snacks. And the
Speaker 2: costs of this are really severe. I mean, Americans pay more,
Speaker 2: wages are lower, small and independent businesses can't compete on
Speaker 2: a level playing field. And yet, at least a decade ago,
Speaker 2: it seemed like something that was really fringe and marginal
Speaker 2: to the public conversation. And so I got really excited
Speaker 2: about the possibility of trying to reinvigorate our nation's anti
Speaker 2: monopoly laws. And that's kind of what led me on
Speaker 2: this work.
Speaker 1: One of the ways that I try to provide optimism
Speaker 1: when I do my talks and explaining the current era
Speaker 1: is I always ground it in, hey, this is kind
Speaker 1: of familiar. And if you look at our politics today,
Speaker 1: if you look at sort of the issue of income
Speaker 1: and equality today, our polarization today, it's very very similar
Speaker 1: to the late nineteenth century, early twentieth century. Right, you
Speaker 1: have the big titans of industry, we have the tech
Speaker 1: brologarchs today, you have you know, you have this sort
Speaker 1: of you know, we had a rise of nativism back
Speaker 1: then that seems to be coming back. Obviously, there's concern
Speaker 1: as we transition. Back then it was a grand economy
Speaker 1: to an industrial economy. Now we're transitioning from an industrial
Speaker 1: economy to do whatever we're going to call us right,
Speaker 1: we still haven't figured it out. Is it a service economy,
Speaker 1: is it a tech economy? However we want to call it,
Speaker 1: And with it will come over time more people noticing, Hey,
Speaker 1: wait a minute, something's off here. Looking at that historical comparison,
Speaker 1: he said, play professor for me. We're am I right,
Speaker 1: and where do you think I'm a little off base
Speaker 1: on a comparison.
Speaker 2: I'm so glad you noted that, because you're right. The
Speaker 2: historical parallels are incredibly striking. It was the Industrial Revolution
Speaker 2: that delivered so many advances for Americans, but also allowed
Speaker 2: a very small number of companies and individuals to concentrate
Speaker 2: a tremendous amount of power. And it was the ability
Speaker 2: of these monopolists and these industrial trusts to abuse that
Speaker 2: power that set in motion of movement anti monopoly movement
Speaker 2: to make sure that government had the tools and the
Speaker 2: authority to check corporate abuse and to try to create
Speaker 2: an economy that's really delivering fairness for everyday people. And
Speaker 2: I think you know, at the FTC, I was able
Speaker 2: to travel the country and meet with a lot of
Speaker 2: communities and try to understand what are the economic points
Speaker 2: that people are facing, and so many of the daily challenges,
Speaker 2: be it, you know, the inability to afford your medicines,
Speaker 2: having to ration things like insulin, to not being able
Speaker 2: to afford your groceries, to having another job offer but
Speaker 2: not being able to switch because you have a noncompete,
Speaker 2: to you know, being abused by your corporate landlord. I mean,
Speaker 2: so many of the day to day pain points that
Speaker 2: are really squeezing Americans and making them feel like they're
Speaker 2: not getting a fair shake no matter how how hard
Speaker 2: they're work than not able to get ahead. I think
Speaker 2: a lot of that economic anxiety is very ripe and
Speaker 2: not all too different from what people were facing a
Speaker 2: century ago.
Speaker 1: I'll be honest, I hear I've heard a few of
Speaker 1: the phrases and words I feel like, and I feel
Speaker 1: like when we all talk about these things, the famous
Speaker 1: Teddy Roosevelt speech, and also otomy right like, I can
Speaker 1: sort of hear some of that language just known and
Speaker 1: what you were talking about. I guess the question, you know,
Speaker 1: one of the things that strikes me about hearing you.
Speaker 1: The way you talk about this is as we have
Speaker 1: this debate on the left about capitalism versus you know,
Speaker 1: is it are we in late today capitalism? Is it failing?
Speaker 1: In some ways you're articulating that, hey, if capital you know,
Speaker 1: capitalism in its purest or free market form should be uh,
Speaker 1: should be egalitarian of sorts. And in some ways we've
Speaker 1: we're perverting capitalism with this consolidation of power. It's not
Speaker 1: that isn't capitalism, right? I mean, it's like I always
Speaker 1: joke the NFL is one of the great socialistic enterprises
Speaker 1: that exists, right, it is not. The teams do not
Speaker 1: compete against each other, right, They share all of their
Speaker 1: revenues equally, and they have marginal ways that they get
Speaker 1: to do this. Do you count yourself as a sort
Speaker 1: of in some ways a pure capitalist who just thinks
Speaker 1: the rules need to be fair.
Speaker 2: I mean, we absolutely need the rules to be fair.
Speaker 2: And one of the key principles that we've used to
Speaker 2: structure our economy is this idea of competition, right, the
Speaker 2: idea that we want to have markets where if you
Speaker 2: have a good idea, if you have the talent to
Speaker 2: kind of bring a new idea to market, bring a
Speaker 2: new business to market. You should be able to compete
Speaker 2: on a level playing field, right, And so much of
Speaker 2: the innovation, the breakthrough advances in our country, be it
Speaker 2: in Silicon Valley, be it in areas like medicines have
Speaker 2: come from upstarts, right, from somebody with a good thing
Speaker 2: being able to fairly compete. And you're absolutely right that
Speaker 2: as our markets become more and more dominated by smaller
Speaker 2: and smaller number of companies, and those monopolies abuse their
Speaker 2: power to squash out their arrivals to kind of rig
Speaker 2: the playing field, we all lose out right. People. People
Speaker 2: feel like it's not fair, and materially the consequences and
Speaker 2: the outcomes are worse for us as an economy.
Speaker 1: Some of the places where I think that there is
Speaker 1: a left right convergence on agreement that the government needs
Speaker 1: to do something is the role of the tech big
Speaker 1: tech companies. Right. I'm going to ask from a very
Speaker 1: selfish point of view, which is media. I look at
Speaker 1: the issue of distribution and we in media, and I
Speaker 1: don't care where you are these days, whether you're at CBSNBC, ABC,
Speaker 1: whether you're an independent substacker or somewhere in between. You
Speaker 1: do not control your distribution. Distribution is in the hands
Speaker 1: of some a handful of tech companies who can dial
Speaker 1: up or dial down the algorithms, and there is no
Speaker 1: transparency and how it works and how it does walk
Speaker 1: me through the difficulties. It is for THETC to play
Speaker 1: a role here in trying to because I just I
Speaker 1: think you've been I think you tried. I think you're trying.
Speaker 1: I think there's some form of this of your successor
Speaker 1: at least keeping some of these cases going. But is
Speaker 1: in my great fear is that we're going to get
Speaker 1: resolution and it'll be obsolete tech that we finally were
Speaker 1: able to you know, we're finally able to resolve some issues,
Speaker 1: but it's no longer the prominent thing. Meanwhile, this consolidation
Speaker 1: of power has destroyed the entire media ecosystem.
Speaker 2: It's a very valid fear, and candidly, I think enforcers
Speaker 2: and policymakers in DC were generally slow to kind of
Speaker 2: recognize the enormous problem of tech consolidation. Right in the
Speaker 2: early two thousands, there was almost this like religious zeal
Speaker 2: that these tech companies were spreading this idea that there
Speaker 2: were these revolutionary companies that were just going to be
Speaker 2: you know, really fantastic for people. And there was almost
Speaker 2: like this you know, move fast and break things type mentality,
Speaker 2: and there was a sense that these markets moved so
Speaker 2: quickly that if anything, it's better to get out of
Speaker 2: the way, that the government should be a stands off
Speaker 2: as possible. And I think what we've seen is that
Speaker 2: there were enormous costs to that. Right, we now have
Speaker 2: just a handful of companies that are controlling key arteries
Speaker 2: of commerce, key arteries of communication, and that functionally means
Speaker 2: that these companies are getting to call the shots on
Speaker 2: slots of business activity. Right. You noted, they're getting to
Speaker 2: effectively call the shots on what content gets heard or
Speaker 2: seen with no transparency and no accountability, right because there's
Speaker 2: no competition in the market. If you don't like what
Speaker 2: a Google algorithm is doing, you don't really have that
Speaker 2: much choice. And that's what was so eye opening for
Speaker 2: me is that there were actually thousands upon thousands of
Speaker 2: businesses that were enormously alarmed and disturbed about the power
Speaker 2: that these tech companies had accumulated because they could only
Speaker 2: their access to customers was entirely dependent on the whims
Speaker 2: of an Amazon or a Google, and I would have
Speaker 2: companies tell me, you know, I woke up today for
Speaker 2: some reason, on Amazon, I went from page one to
Speaker 2: page seven, or on Google from page one page seven.
Speaker 2: And if this does I don't know why, nothing changed
Speaker 2: on my end, But if this doesn't get fixed, my
Speaker 2: business is going to go bankrupt. And you know, I
Speaker 2: remember there was a business who was quoted saying Google
Speaker 2: has more power than the government. Right, the government can
Speaker 2: tax me, but if changes an algorithm, my business is
Speaker 2: going to go under. And so I think people started
Speaker 2: to realize just the enormous power these companies have. If
Speaker 2: it's not how to account can just be extremely abusive.
Speaker 1: Let's good to something. How did we get to the
Speaker 1: point where I have to be I have to consent
Speaker 1: for my data to use an app versus the app
Speaker 1: having to consent to me to get data. Do you
Speaker 1: see what I mean? Like we've totally reversed the permission structure,
Speaker 1: which is I basically I'm being coersed to give up
Speaker 1: something to use a product, right to use a Google
Speaker 1: apport simply to update a product I've already purchased. But
Speaker 1: if I want a free update, I've got to you know,
Speaker 1: instead of you know, I got to give something in return,
Speaker 1: And there's no alternative, like I could say, Hey, I
Speaker 1: don't want to give you this data? Can I buy it? Right?
Speaker 1: They're not even they're not even giving me access to
Speaker 1: this updated version of the apps. How did we get
Speaker 1: here where we're they're not asking us permission, but essentially
Speaker 1: we're being coerced.
Speaker 2: It's a really important question. And a key moment was
Speaker 2: in the early two thousands where some of these businesses
Speaker 2: started adopting business models that were premised effectively on surveiling
Speaker 2: you and harvesting all of your data.
Speaker 1: Right.
Speaker 2: Companies like Google, Facebook decided they were going to monetize
Speaker 2: their companies not by charging customers in terms of dollars,
Speaker 2: but instead by collecting data on them and then selling
Speaker 2: that to advertisers. And what that did from a business
Speaker 2: perspective was create an incentive to collect as much information
Speaker 2: on you as possible. Right, And so they're collecting it
Speaker 2: when you're on their website, but they're also collecting it
Speaker 2: across the internet. Now it can be combined with data
Speaker 2: collected on your phone, including your precise geolocation, and there's
Speaker 2: just a huge business incentive because that's how they make money.
Speaker 2: And it's really striking because you know, America has a
Speaker 2: long tradition of being very skeptical of government surveillance, but
Speaker 2: we are now increasingly being surveilled by these private companies
Speaker 2: and we don't know what's happening with that data. At
Speaker 2: the FTP sometimes found it was actually being sold just
Speaker 2: to the highest bidder, even if that meant selling it
Speaker 2: to foreign adversaries, and sometimes it is sold to the
Speaker 2: government or used by the government, and so it seems
Speaker 2: like there's this whole workaround. And you know, companies have
Speaker 2: adopted this notice and consent where they think if they
Speaker 2: just present you this long terms of service and you
Speaker 2: agree that that means you're consenting. But we all know
Speaker 2: that's a fiction. And as you noted, we have to
Speaker 2: use these services to navigate day to day life, and
Speaker 2: so it does feel like coercion.
Speaker 1: Well, the South Park Boys probably have the best illustration
Speaker 1: of what happens with the agreement. They did a whole episode.
Speaker 1: I have no idea how familiar with that, but this
Speaker 1: is I recommend it. They did this like a decade ago,
Speaker 1: sort of mocking the automate. What do you mean you
Speaker 1: didn't read your permits and services and now one of
Speaker 1: the boys ends up being a human experiment for Apple
Speaker 1: to become a human centipede iPad or something like that.
Speaker 1: I mean, it's absurd, but it was really well, it
Speaker 1: was satire done exactly to point out this absurdity of
Speaker 1: terms and conditions and the fact that nobody actually reads
Speaker 1: it and you have no idea what you've just consented to,
Speaker 1: and this idea that oh it's on you. Oh come
Speaker 1: on like that. That's not where, that's not realistic. What
Speaker 1: let's this you just talked about the hands off approach
Speaker 1: that essentially government decided to take on the tech industry
Speaker 1: in the first two decades of the century. Here we
Speaker 1: are at AI at this moment, and that is exactly
Speaker 1: the same conversation all these AI had, don't regulate us, right,
Speaker 1: And we just saw that bill there was going to
Speaker 1: be an attempt to put a moratorium on state based
Speaker 1: regulations for ten years. As soon as it popped up
Speaker 1: there there were there were at least a few people
Speaker 1: howling about it, and they got stripped out. A reminder
Speaker 1: sometimes transparency is still the best disinfected that you have
Speaker 1: on sometimes on bad policy, but it certainly looks like
Speaker 1: we're about to do the same make the same mistakes
Speaker 1: with AI that we made with social media.
Speaker 2: It's a key risk. And you know, I think we've
Speaker 2: seen some interesting dynamics with AI where some times these
Speaker 2: moments of you know, technological advances and break through advances
Speaker 2: are actually a moment where the market opens up and
Speaker 2: you get new players. And so it was actually you know,
Speaker 2: Microsoft being disciplined by anti trusts that allowed thes and
Speaker 2: the facebooks and the Googles to come in and and
Speaker 2: youer more competition. The risk we're seeing now is that
Speaker 2: this technological revolution will instead allow the existing giants to
Speaker 2: just expand and double down on their power.
Speaker 1: Well let's talk about that real quick, because who could
Speaker 1: start up an AI company on their own? Right now?
Speaker 1: You need to have so much money to get power,
Speaker 1: so much money to get the computer, you know, actual electricity,
Speaker 1: computing power. The barrier to entry is super high. This
Speaker 1: is not so the only companies that can afford it
Speaker 1: are the companies that have already the already have the
Speaker 1: power and the resources.
Speaker 2: Right, That's exactly right. Kind of every step of the way,
Speaker 2: you're basically dependent on the whims of these existing giant
Speaker 2: And I think the other really incredible component here is
Speaker 2: that a lot of these models are being trained on
Speaker 2: people's data. Right, we were just talking about consent and
Speaker 2: the lack of consent. I mean, when I was at
Speaker 2: the FTC, we were talking to creators, writers, graphic designers
Speaker 2: who said, I just woke up one day and my
Speaker 2: life's work had been ingested by this model that is
Speaker 2: now spitting out stuff that is competing with me, and
Speaker 2: it was trained on me, and nobody asked me, and
Speaker 2: nobody paid me. How is that fit? Right? And so
Speaker 2: we've already seen what some of people would call theft
Speaker 2: in terms of just how much of that information has
Speaker 2: already been ingested and monetized without any consent or compensation.
Speaker 2: I think the other potential abusive practice we could see
Speaker 2: is this idea of surveillance pricing. We're not only is
Speaker 2: your data being collected on you, but then it is
Speaker 2: being used against you to price as much as you
Speaker 2: will pay. So imagine you had a death in the
Speaker 2: family and you got an email notice about where the
Speaker 2: services are going to be. You go to buy a
Speaker 2: plane ticket and the airline company knows you are trying
Speaker 2: to get to a funeral, it's an emergency, and maybe
Speaker 2: they'll overcharge you, right, And I think that's going to
Speaker 2: be one of the next frontiers of potential abuse that
Speaker 2: we have to be on guard for.
Speaker 1: Now, this is something you know. Is the FTC set
Speaker 1: up to be proactive or is the entire premise of
Speaker 1: the agency or reactive agency? Right? And I think I
Speaker 1: know the answer to that question, but I feel like
Speaker 1: that's the inherent flaw in the FTC.
Speaker 2: Now, well, it's a good question, and I mean, I
Speaker 2: think what it sounds like what you're suggesting by reactive
Speaker 2: is if the agency is primarily bringing lawsuits, is it
Speaker 2: bringing lawsuits effectively after the fact, once it's too late
Speaker 2: you're going to Yes, No, you're You're right that one
Speaker 2: of the main things the agency does is bring lawsuits
Speaker 2: to kind of go after kind of conduct that's already happened.
Speaker 2: We did also do making and so we can get
Speaker 2: through rules like one of the ones we pushed through
Speaker 2: was a ban on noncompete clauses. These are clauses that
Speaker 2: basically block you from taking a job editor or starting
Speaker 2: your own business.
Speaker 1: It's a huge thing in the media business. It's a
Speaker 1: huge thing in me. Now there's coercion ways to do it.
Speaker 1: You know, they can pay you to be you know,
Speaker 1: to try to try to do that and compensated. And
Speaker 1: is that still legal or noncompete they still compensate. Yeah, no,
Speaker 1: I think if.
Speaker 2: You're compensated, that's a very different situation.
Speaker 1: Believe, not compete without compensation.
Speaker 2: Compensation, and not even for executives in the boardroom, but
Speaker 2: for security guards and janitors and fast food workers. I mean,
Speaker 2: when we were doing this work at the FTC, we
Speaker 2: heard from a bartender in Florida who was being harassed
Speaker 2: at her job. She went to go find a job
Speaker 2: at a different restaurant, and once she was going to start,
Speaker 2: she got hit with a lawsuit for tens of thousands
Speaker 2: of dollars because she had a non compete and her
Speaker 2: original restaurant was trying to block it. I mean, they're
Speaker 2: just such absurd and horrifying stories about how these non
Speaker 2: competes are abused. So we've got put through a rule
Speaker 2: to ban them in the vast majority of contexts, it's
Speaker 2: currently being litigated pushed back against. I think the biggest
Speaker 2: challenge for the FTC candidly is its size. I mean,
Speaker 2: this is a tiny agency relative to its mission and mandate.
Speaker 2: It oversees economic activity across the vast majority of the
Speaker 2: US economy, and at its height when I was there
Speaker 2: was around thirteen hundred people. Now smaller, we've seen, you know,
Speaker 2: a brain drain, a lot of attrition, people kind of
Speaker 2: trying to flee. And it's tough. You know, we've heard
Speaker 2: about DOGE cuts and the agency shrinking further, and so
Speaker 2: I think that's a challenge.
Speaker 1: And yet there is you know, there is a heart
Speaker 1: of of the populist right that very much. You know,
Speaker 1: we're cheering you on when it came to Facebook and that,
Speaker 1: and cheering you on when it came to Amazon. And
Speaker 1: yet it doesn't seem as if that is it doesn't
Speaker 1: seem like that part of that base as a voice
Speaker 1: in this current administration. That's what it's been more lip service.
Speaker 2: It's such an interesting question, and you know sometimes it
Speaker 2: changes week by week, but you're right, it does seem
Speaker 2: like overall there has been a drift right, if there's
Speaker 2: a fight between the kind of populist wing and the
Speaker 2: corporateest wing. It does seem like more and more the
Speaker 2: kind of corporatist wing is winning out. I mean, we
Speaker 2: do see some pushback and kind of efforts to grapple
Speaker 2: through this, you know, at the FTC. I think you're
Speaker 2: right that there was kind of support among Republican members
Speaker 2: of Congress, but there's almost support at a grassroots level, right,
Speaker 2: I mean, I would get.
Speaker 1: More support on the grassroots level, frankly, right, Yeah, I
Speaker 1: think that's right.
Speaker 2: I would get letters from, you know, people saying I'm
Speaker 2: a lifelong Republican, a hardcore free market capitalist, but if
Speaker 2: the FTC bans noncompetes, it'll be the best thing government
Speaker 2: has ever done. I would have Republican business owners coming
Speaker 2: to me nearly in tears, right, independent pharmacists, farmers, saying
Speaker 2: my business is about to go under because of this
Speaker 2: massive middleman that's squeezing me out. And so I think,
Speaker 2: you know, this issue of unchecked corporate power, of monopoly
Speaker 2: abuse has become so acute that it affects every part
Speaker 2: of our country, then there's a lot of support for
Speaker 2: taking it on.
Speaker 1: It sort of in hearing about some of the most
Speaker 1: egregious monopolistic practices, it seems as if it's more egregious,
Speaker 1: the more mature said industry is, So take pharmaceuticals. You
Speaker 1: brought up the independent pharmacy issue versus Frank, you know,
Speaker 1: the two giants, and I guess it's one and a
Speaker 1: half giants, right. I think Walgreens is struggling to keep
Speaker 1: up with CBS. Is it even possible to be an
Speaker 1: independent pharmacist anymore? And is it just that feels like
Speaker 1: an extraordinarily consolidated thing. And what role should the FDC
Speaker 1: have in something like this? On behalf of independent pharmacists.
Speaker 2: So this was a big area of focus for us
Speaker 2: because independent pharmacies, especially in rural area areas, play such
Speaker 2: a critical role. I mean sometimes they are the only
Speaker 2: kind of healthcare provider nearby. And what's been so interesting
Speaker 2: is that communities generally love their independent pharmacists, and these
Speaker 2: independent pharmacists are kind of, you know, offers.
Speaker 1: Kind of like doctors. I mean, look, I'm my my
Speaker 1: grew up in northwest Florida. Pensacola is a pretty mature community.
Speaker 1: But some of the outlier communities where are families from
Speaker 1: very much and there's a you know, small independent pharmacist
Speaker 1: that was like the family called them up right, you know, Hey,
Speaker 1: my kids got a cold. What what should I tell?
Speaker 1: I mean, they treat the pharmacist almost like a doctor.
Speaker 1: That's how important they are, you know. And just see
Speaker 1: I've seen it sook, you know, with an in law
Speaker 1: who was suffering and a prescription ran out on a Saturday.
Speaker 1: They didn't know what else to do, right, and it
Speaker 1: so it really is a community lifeline in these smaller
Speaker 1: and these smaller communities.
Speaker 2: That's right. And a lot of these independent pharmacies are
Speaker 2: being squeezed, not because their communities don't love them and
Speaker 2: benefit from them, but because there are these actors called
Speaker 2: pharmacy benefit managers. There are these kind of middlemen in
Speaker 2: the healthcare system that coordinate between the pharmacy and the
Speaker 2: health insurance and the drug manufacturer.
Speaker 1: Why do they exists? I mean, this is my big question.
Speaker 1: I don't I'm going to I watched a lot of
Speaker 1: you know, if you're living, if you live in the
Speaker 1: DC market, you hear about PBMs. It's the only place
Speaker 1: you hear about it, right, because it's a fight over legislation,
Speaker 1: and they're trying to fight for their existence and all
Speaker 1: of this stuff. And no matter how much I even
Speaker 1: follow the issue, and I like, what the hell are
Speaker 1: these and why do they exist?
Speaker 2: So in theory they came into existence to try to
Speaker 2: make prices lower for people, but there's good evidence that
Speaker 2: they're actually having the opposite effect, right, And so now
Speaker 2: these PBMs have actually vertically integrated with the health insurer.
Speaker 2: Some of them have their own mail order pharmacy, and
Speaker 2: pharmacies will tell us that patients are coming to them
Speaker 2: and saying, Hey, I've been fulfilling my prescription with you
Speaker 2: for years, but I just got this letter from my
Speaker 2: insurance company saying now I can only fulfill this through
Speaker 2: their mail order pharmacy. And guess what. The mail order
Speaker 2: pharmacy is using trucks in the heat, and by the
Speaker 2: time your medicine gets to you, it actually ended up
Speaker 2: getting spoilt. And so they're just all these perversions. The
Speaker 2: PBMs are also responsible for reimbursing the pharmacies. Pharmacies tell
Speaker 2: us they are routinely under reimbursed, and so they're actually
Speaker 2: losing money when they are providing patients with life saving medicines,
Speaker 2: and so it seems like a big, big perversion. We
Speaker 2: investigated this at the FTC. We sued the PBMs for
Speaker 2: practices that we alleged lading drug prices. But there's a
Speaker 2: lot more to be done here.
Speaker 1: Let's talk about the cases that you didn't you weren't
Speaker 1: able to finish, right you, you know, would would have
Speaker 1: liked that more time. And what's going to continue? Where
Speaker 1: are you relieved? Where it looks like the FTC is
Speaker 1: going to stay on this?
Speaker 2: Well, so far we have seen the Facebook litigation continue.
Speaker 2: We s that there was a huge scramble by Mark
Speaker 2: Zuckerberg to try to settle that on the eve of trial.
Speaker 2: They didn't do it. They'll let the trial happen. We're
Speaker 2: waiting to get out.
Speaker 1: It was a cynic. I assumed he was going to
Speaker 1: get it. I'll be honest. I figured somebody would tell
Speaker 1: him what the number was and he'd write the check.
Speaker 1: The fact that it didn't happen was oddly surprising.
Speaker 2: Yeah, it's interesting, and I think we're all going to
Speaker 2: have to be very vigilant about what happens down the line,
Speaker 2: because there is a world in which the FTC wins,
Speaker 2: and then that's another leverage point.
Speaker 1: And is that and they settle anyway?
Speaker 2: Right backed something? And I think that's why a lot
Speaker 2: of this seems like a double edged short, it just
Speaker 2: seems like so much willingness by the White House to
Speaker 2: use law enforcement as a political cudgel to extract favors
Speaker 2: or kind of punt received enemies, and so the potential
Speaker 2: corruption of these cases is a big risk to my mind.
Speaker 2: So far, our lawsuit against Amazon is going forward. Our
Speaker 2: lawsuit against John Deere is going forward. This is a
Speaker 2: lawsuit where we alleged Deer was illegally making it very
Speaker 2: difficult for farmers to fix their own tractors and equipment
Speaker 2: fixed by a deer dealer, which meant not only was
Speaker 2: it more expensive, but you had to wait an incredibly
Speaker 2: long time, and sometimes that would result in farmer's crop
Speaker 2: getting ruined. So that those litigations are still going forward.
Speaker 2: We have seen some backtracking on the consumer protection side,
Speaker 2: which is where we've been very active in terms of
Speaker 2: taking on these junk fees, requiring that businesses make it
Speaker 2: as easy to cancel a subscription as it is to sign.
Speaker 2: A judge just tossed out that rule, and we're going
Speaker 2: to have to see where the FTC stays strong or
Speaker 2: backs off.
Speaker 1: Well, I could, I could, I could go on a
Speaker 1: number that they went the impossibility when you sign up
Speaker 1: for something to then cancel it. It is And it
Speaker 1: doesn't matter whether I'm talking about national season tickets, who
Speaker 1: like they will literally send an email on a notice
Speaker 1: but no link, and then they'll like be on the
Speaker 1: lookout for the link two or three weeks later and
Speaker 1: they don't ever And that's just them, And this is
Speaker 1: this is just an example across the board with these
Speaker 1: subscription services, no matter what it is, right, whether it's
Speaker 1: a small subscription for for for a magazine or something,
Speaker 1: or a large one for a streaming service or season
Speaker 1: tickets or whatever it is, it does seem as if
Speaker 1: that there is a lot of fast and loose when
Speaker 1: it comes to these auto renewals, if you will, and
Speaker 1: that that feels that feels like one of those one
Speaker 1: of those issues that if the government could find a
Speaker 1: way to clamp down on it, it would be enormously popular.
Speaker 2: Yeah, you know, we tried to clamp down on it.
Speaker 2: I mean, I think the idea that companies shouldn't be
Speaker 2: able to trap you in subscriptions is as unobjectionable as
Speaker 2: it comes, frankly, and unfortunately, it's an area where we've
Speaker 2: seen increasing abuse because more and more businesses are becoming
Speaker 2: a reliant on subscription based revenues. So even for things
Speaker 2: like a printer, sometimes you need a subscription for your
Speaker 2: printer to work.
Speaker 1: Right, Can I thank you for bringing that up? That
Speaker 1: drives me bonkers? No, I'm not doing that with your
Speaker 1: tone or subscription. And it's like, it is, like, what
Speaker 1: do you lean I've got to sign up for a
Speaker 1: subscription after I bought your product. That's just a weird
Speaker 1: I am. Now. Maybe I'm just old guy, right and
Speaker 1: I'm just like not used to it, but I'm like,
Speaker 1: it's funny just because I did like a subscription. Really, God,
Speaker 1: you are just nickel and Diamond. It goes back in.
Speaker 1: This may be a tad before your time, but it
Speaker 1: was Circuit City and best Buy used to just try
Speaker 1: to force you to buy these, and Amazon now does
Speaker 1: it too. Actually, if you buy any sort of product, hey,
Speaker 1: do you want to buy insurance on it? Or you
Speaker 1: want to buy a you know, they sort of force
Speaker 1: these back then. It was a bit predatory the way
Speaker 1: Circuit City did it. I think actually the government claimed
Speaker 1: down on them at the time.
Speaker 2: Interesting, and what was really suprising was when we started
Speaker 2: investigating some of these practices. The executives internally were not
Speaker 2: subtle that this was a deliberate business strategy, and sometimes
Speaker 2: they would actually have kind of low level employees saying, hey,
Speaker 2: we're getting a lot of customer complaints that our subscription
Speaker 2: process theems deceptive, where people are being enruled without knowing it,
Speaker 2: or once they're enrolled they can't easily cancel.
Speaker 1: And as you're saying, the execs, let's see it as
Speaker 1: a feature, not a bug.
Speaker 2: Yeah. I mean sometimes, and this happened at Amazon, you
Speaker 2: know where it happened at Adobe, where a lower level
Speaker 2: employee said, let's fix this, here's an alternative, and the
Speaker 2: executive said, no, you know, I think we'll leave it
Speaker 2: how it is. So, you know, I think another component
Speaker 2: here is the courts. I mean the number of rules
Speaker 2: that were pushed through in the last administration that would
Speaker 2: have materially improved people's lives. I mean this click to
Speaker 2: cancel rule, our rule banning non competes. We had rules
Speaker 2: from the Consumer Financial Protection Bureau that would limit medical
Speaker 2: debt from being used on your credit report, that would
Speaker 2: have limited overdraft fees. A whole set of rules have
Speaker 2: been tossed out by courts. Sometimes I think on pretty
Speaker 2: bogus basis. I think there is going to be if
Speaker 2: kind of Democrats get a chance to govern again in
Speaker 2: four years, it kind of broader reassessment of how is
Speaker 2: to govern when you have courts that are so hostile
Speaker 2: to some of this governing.
Speaker 1: Well, you know, some of this stuff though is not
Speaker 1: everybody knows about it, and in some ways, you know,
Speaker 1: what lessons have you learned about how to communicate what
Speaker 1: you're doing, because that sometimes you know, if you can
Speaker 1: communicate it right, well, the public won't, you know, won't
Speaker 1: accept the idea of another administration rolling it back. And
Speaker 1: there were times that I thought, oh my god, you
Speaker 1: guys are doing a tremendous amount of stuff, but it's
Speaker 1: almost like you're over the public's not. There's too much
Speaker 1: and the public's not going to realize what you're doing.
Speaker 1: And if they don't, then it doesn't take root. And
Speaker 1: if it doesn't take root, becomes easy to throw out.
Speaker 1: What what have you? What did you learned ear in
Speaker 1: your four years that if you ever got another shot
Speaker 1: at this, what would you is there is there different
Speaker 1: ways would you would you sort of tackle less at
Speaker 1: any one time? Right? Because there's so much you want
Speaker 1: to do, like, how much do you think the communications
Speaker 1: strategy has to be a part of what you're doing.
Speaker 2: You're right that it's absolutely essential. And you know, the
Speaker 2: ftc U for some years now had had been kind
Speaker 2: of in the shadows, uh, you know, people didn't know
Speaker 2: what it was, what the agency did, and so it
Speaker 2: was a bit of a departure candidly when I was
Speaker 2: there for for the FTC to be as out there
Speaker 2: as it had been. And we did that for a
Speaker 2: couple of reasons. One was I think in DC sometimes
Speaker 2: there can be this tendency to over index on kind
Speaker 2: of the expert class for how we understand the economy,
Speaker 2: and that can create certain blind spots where you really
Speaker 2: have to talk to people and understand what is people's
Speaker 2: lived in experience to understand what those pain points are.
Speaker 2: And so we did listening sessions, We did regular open
Speaker 2: commission meetings where anybody in America could sign up and
Speaker 2: talk to the Federal Trade Commissioners, and just really broadened
Speaker 2: the voices we were hearing to make sure we had
Speaker 2: a real three sixty view of the economy rather than
Speaker 2: of you that was dominated by the kind of lobbyists
Speaker 2: and the lawyers and the kind of class. But it
Speaker 2: was also to be able to communicate, right, I mean,
Speaker 2: the FTC is the agency where if it's doing its job,
Speaker 2: if it's taking on monopolies and corporate law breakers, it
Speaker 2: is going to face pushback from those corporate interests, and
Speaker 2: you need to make sure that you are building the
Speaker 2: countervailing support from the people that are benefiting from this work.
Speaker 2: You know, we had a small agency. We had a
Speaker 2: heroic comms team, but it was very small, and so,
Speaker 2: you know, I think figuring out how can kind of
Speaker 2: other players and government and political system alsolifying this will
Speaker 2: be key.
Speaker 1: You know, one of the challenges. It's funny you bring
Speaker 1: up to sort of kind of broaden what the FTC
Speaker 1: folks were hearing about the economy. And one of my
Speaker 1: more complaints about traditional media over the last two decades
Speaker 1: when it comes to coverage of the economy is I
Speaker 1: used to argue we don't cover the economy, we cover markets,
Speaker 1: and the CNBC afflication of business coverage right when I
Speaker 1: was you know, coverage of the economy was much different
Speaker 1: in the eighties and nineties, and then when we all
Speaker 1: became so market focused, Right, there's a part of me
Speaker 1: that thinks that it almost made people more comfortable with
Speaker 1: consolidation because consolidation was good for the stock market than
Speaker 1: stock market was good for retirement. Like we sort of
Speaker 1: perverted what even economics reporting was right. The economy is people.
Speaker 1: The economy is not markets. And the only business coverage
Speaker 1: in mainstream media today is markets. Right, whether it's Fox
Speaker 1: Business Channel or SANBC, you don't really get the same
Speaker 1: kind of consumer protection coverage that used to be quote
Speaker 1: unquote business coverage. Now it feels like it's all about
Speaker 1: markets and all about equity.
Speaker 2: That's such a profoundly important point, and I think one
Speaker 2: of those kind of hidden shifts that does really have
Speaker 2: enormous downstream consequences for how policy makers, even as you said,
Speaker 2: understand what the economy is. Right, and if you're just
Speaker 2: using for your understanding of the economy the stock market
Speaker 2: as the key proxy of whether people are doing well
Speaker 2: or not, we're going to miss a lot. And sometimes candidly,
Speaker 2: stock prices go up because companies are doing things that
Speaker 2: are profitable for them but actually bad for regular people.
Speaker 2: And so not only can it be inadequate, but it
Speaker 2: can sometimes be you know, the inverse, and so I
Speaker 2: think that's a problem. And I think, you know, one
Speaker 2: thing that's been interesting is this broader conversation now happening
Speaker 2: in DC but across the country about how it is
Speaker 2: it that that people should govern and how is it
Speaker 2: that people should kind of win elections. And it does
Speaker 2: seem like those people who are focusing on listening to people, right,
Speaker 2: we just had money when in New York City he
Speaker 2: went to all cards and asked them, Hey, what is
Speaker 2: it that's making your business? Right, kind of that on
Speaker 2: the ground level economics, economy reporting, and to bring to
Speaker 2: it a sense of curiosity, right, just like there's a
Speaker 2: lot we don't know in DC, and making sure we're
Speaker 2: actually going out there and asking people who are kind
Speaker 2: of experts in their own domain. So I think we
Speaker 2: need a lot more of that.
Speaker 1: So one of the things that I've I sort of
Speaker 1: get on my hobby horse about when it comes to
Speaker 1: government regulation is algorithms. I don't see any good that
Speaker 1: comes from an algorithm personally, I understand, you know, and
Speaker 1: I feel like they're you know, I don't want an
Speaker 1: algorithm trying to suggest what I might like. I want
Speaker 1: to decide what I like, and then I might say Yeah,
Speaker 1: let's personalize a search, and you go ahead and me
Speaker 1: stuff that's similar to this. But I want control of that.
Speaker 1: If I'm going to sound a little rubish and go
Speaker 1: ahead and say it, which is, God damn it, I
Speaker 1: want my government to I mean, who's who's regulating these algorithms?
Speaker 1: They're black boxes and it is it is. How I
Speaker 1: interact with Google is different than somebody else interacts with Google,
Speaker 1: and I have nobody sort of I have no idea
Speaker 1: whether I'm I'm getting a fair look or not because
Speaker 1: I don't know how the algorithm works. Do you should
Speaker 1: the act? Who should and should government basically be in
Speaker 1: the business of regulating algorithms.
Speaker 2: It's a great question, and I think one of the
Speaker 2: places where it's most acute right now is when it
Speaker 2: comes to kids. Right there's been a huge epidemic of
Speaker 2: you know, social media addiction abuse on these platforms, and
Speaker 2: parents feel like they don't have any control of what
Speaker 2: their kids are seeing. And these companies, again, their business
Speaker 2: model is to monetize data. And it's been shown that
Speaker 2: the content that is does best is oftenheims the content
Speaker 2: that is most divisive or most inflammatory.
Speaker 3: Because there's exspectives of you, all right, the incentives to
Speaker 3: keep you on the platform, to see more advertisements, to
Speaker 3: see more whatever, and well, okay, you've learned human psychology,
Speaker 3: and if you're using human psychology against us, that's I
Speaker 3: thought that was manipulative.
Speaker 1: I thought that was something that the FDC was supposed
Speaker 1: to say, No, you can't do that.
Speaker 2: I mean, we've had executives from some of these companies
Speaker 2: acknowledge publicly that some of the techniques that they're using
Speaker 2: are basically similar to how people are designing slot machines
Speaker 2: for gambling in terms of like they're designed to keep
Speaker 2: you addicted. And so the fact that we haven't had
Speaker 2: kind of extensive government involvement here, I think is creating
Speaker 2: a lot of pain and going to lead to a
Speaker 2: lot of problems.
Speaker 1: We got a few more minutes here. Who owns data
Speaker 1: and where should you know? So Frank McCort, the former
Speaker 1: owner of the Dodgers, was working on something called Project Liberty.
Speaker 1: He wrote a piece he was now, I think he's
Speaker 1: trying to be one of the folks that might buy TikTok.
Speaker 1: We'll see, but he's actually, you know, he he he
Speaker 1: has pitched this idea that data should be in a
Speaker 1: public trust that Amazon should known data, Google should know
Speaker 1: own data that you know, they essentially should license the
Speaker 1: use of data, but that data should be almost like
Speaker 1: a public utility. I guess what would that could that happen,
Speaker 1: what would that look like? I mean, at what point,
Speaker 1: you know, I've been waiting for my data built privacy
Speaker 1: Bill of Rights to be passed by a Congress for
Speaker 1: the last twenty years, and it's not happened. I think
Speaker 1: we inherently and here's what's sort of frustrating. Individual data
Speaker 1: is worthless, collective data is infinitely valuable. It seems that
Speaker 1: we've got that this is sort of one of the
Speaker 1: hardest issues to tackle, and yet it's at the heart
Speaker 1: of almost all of these current antitrust conversations.
Speaker 2: You're right, and the companies will say that they own
Speaker 2: the data, effectively, that once they have collected it, that
Speaker 2: it is their property, and there are all these basic
Speaker 2: questions about, well, how does that work if it was
Speaker 2: actually my data, but now it's being complete your data,
Speaker 2: you know. To my mind, that's a key question. But
Speaker 2: another key question is should some of this data be
Speaker 2: off limits for monetization in the first place? I mean,
Speaker 2: at the FTC. We would do investigations where we would
Speaker 2: find that companies like health apps, we're collecting sensitive information,
Speaker 2: health information from people and then selling that on to
Speaker 2: these data brokers and then you know, all sorts of
Speaker 2: bad actors could get their hands on it. We had
Speaker 2: geolocation from your phone being sold, including to stalkers and abusers.
Speaker 2: There's just huge risks here. And so one thing that
Speaker 2: we did through some of these law enforcement actions was
Speaker 2: say that for sensitive data, for data about your browsing
Speaker 2: history on the internet, your precise location, your health, that
Speaker 2: data by default cannot be sold. That unless you are
Speaker 2: affirmatively agreeing and consenting to that data be sold. The
Speaker 2: default is it cannot be And so you know, I
Speaker 2: think we need some more of those bright line rules
Speaker 2: to get past this fiction. The default is everything is
Speaker 2: collected and sold. And then we need to think about
Speaker 2: some of the business models and the monetization and the
Speaker 2: algorithm and how all of that fits together.
Speaker 1: Look, I give Apple credit the ask app not to track, Like,
Speaker 1: why was that so hard? Why is that so hard?
Speaker 1: And is that now I've heard that there are a
Speaker 1: whole bunch of small I guess in gaming companies, you know,
Speaker 1: who may who made money simply on quote unquote free acts,
Speaker 1: right that it hurt their businesses. I'm not shedding a
Speaker 1: tear over that. If that's how they if that was there,
Speaker 1: if that was their north star and how to make
Speaker 1: money for their business.
Speaker 2: Yeah, I mean, I think what was so striking is
Speaker 2: once Apple introduced that. I think they reported that over
Speaker 2: sixty percent of Americans chose not to have their data,
Speaker 2: you know, shared, which is very important because sometimes hear
Speaker 2: from these companies as well, Americans don't really care about
Speaker 2: privacy because if they did, they wouldn't agree to use
Speaker 2: all our services. And as we started off with, you know,
Speaker 2: the consent here is a fiction, and when you actually
Speaker 2: get people to overwhelming there is.
Speaker 1: Some generational data on this. You know, my kids, I
Speaker 1: have an eighteen year old and twenty one year old,
Speaker 1: they're you know, they they're sort of they're weirdly more
Speaker 1: comfortable with more of their data out there, you know.
Speaker 1: And now I would argue, well, they've been sort of
Speaker 1: you know, they've been sort of trained, if you will. Unfortunately,
Speaker 1: you know, and maybe that's on me as a parent,
Speaker 1: didn't realize how much this was happening, right, You just
Speaker 1: don't fully appreciate it until they're like, yeah, you know,
Speaker 1: this is the price of doing business and on the internet,
Speaker 1: which you know, you know, I guess that's what these
Speaker 1: big tech companies are counting on, right, that we're just
Speaker 1: going to be we care about using the products too
Speaker 1: much to worry about the personal stuff.
Speaker 2: Yeah, I mean, I think sometimes this is also true
Speaker 2: where privacy can sound kind of abstract, but once you
Speaker 2: lay out how this data can be used against you,
Speaker 2: including by setting a specific price for you that is
Speaker 2: different from the price you're friends.
Speaker 1: Or surveillance pricing, like how do you well? That feels
Speaker 1: like how are you going to be able to prevent
Speaker 1: that without sort of micro managing and regulating algorithms in general? Right?
Speaker 1: I mean, isn't that that to me? That gets that
Speaker 1: to why I want this? And I know the tech
Speaker 1: companies would find this invasive and onerous because they don't
Speaker 1: want to admit how manipulative, intentionally manipulative these algorithms are
Speaker 1: being built to do.
Speaker 2: That's right, and there are real battles happening, I mean
Speaker 2: in state legislatures in Congress. It does it's clear that
Speaker 2: whenever lawmakers have tried to do something here. There has
Speaker 2: been ferocious pushback, farrocious lobbying, and just a clear example
Speaker 2: of companies using their economic power as political power.
Speaker 1: Let me get you out in here on this. How
Speaker 1: can the average person keep an eye on this or
Speaker 1: this issue of surveillance pricing? Just my guess is this
Speaker 1: is something that's going to become a bigger issue. It's
Speaker 1: not going to go away. It's actually going to become
Speaker 1: more as this happens. Is there any good consumer tips
Speaker 1: to sort of to you know, double check to see
Speaker 1: if this is happening to you.
Speaker 2: Yeah, it's a great question, and it's ultimately not something
Speaker 2: that can be fixed by us as individuals. Really, do
Speaker 2: you need the government to kind of come in and
Speaker 2: work on our behalf? I mean, you know there are
Speaker 2: browsers that are more designed for privacy and more designed
Speaker 2: to limit how much data can be collected on you.
Speaker 2: They recommend kind of clearing your cookies to try to
Speaker 2: limit collections. So you know, there are things on the
Speaker 2: margins that people can do to try to protect more
Speaker 2: of their privacy. But it's tough, and I think kind
Speaker 2: of telling lunched officials to kind of work on this
Speaker 2: is going to.
Speaker 1: Be key if it sounds like I've always joked that
Speaker 1: thank God for the EU. They seem to care about
Speaker 1: my privacy more than my United States government? Does you know?
Speaker 2: It's an interesting question. They do have this, this GDPR.
Speaker 2: I think there are split opinions on how effective it
Speaker 2: has been. Some people have said, Okay, it's just created
Speaker 2: this kind of endless set of clicking, and we don't
Speaker 2: know if there are actually any.
Speaker 4: Serious contract company hate it. The tech companies hate it.
Speaker 4: And if they hate it, I'm like, well, maybe you
Speaker 4: know they're squealing. That tells me something.
Speaker 2: Yeah, yeah, I know the US is behind on this one.
Speaker 2: We don't have any federal privacy lows.
Speaker 1: So what's next for you, Leanah.
Speaker 2: You know, figuring out how to continue this work. I
Speaker 2: think there's a huge movement afoot, candidly to figure out
Speaker 2: how do we have our government be more responsive on
Speaker 2: these economic power issues. I'll be teaching anti trust law
Speaker 2: and so excited to help train the next generation, but
Speaker 2: very interested and how do we make sure that people
Speaker 2: in DC are really hearing from people across the economy
Speaker 2: and as you put it, you know, not just using
Speaker 2: the stock markets as a barometer for whether the economy
Speaker 2: is working, and how do we make that better? How
Speaker 2: do we govern better?
Speaker 1: Yeah, I'm unfortunately worried that the c has been captured
Speaker 1: a little bit on this, that there's a little bit
Speaker 1: of bipartisan capture on markets, on tech, on fear of
Speaker 1: China being used. Right, every time they want to stop
Speaker 1: a rate, no, no, no, no, that is going to
Speaker 1: bet us. It's almost used as a threat. So I definitely,
Speaker 1: I definitely think that you're going to have plenty of
Speaker 1: people very curious on what you do next and how
Speaker 1: much you can amplify it. So good luck and and
Speaker 1: enjoy the person you teaching this fall. You're going right
Speaker 1: back into it. Yeah, all right, Well, there's there's nothing
Speaker 1: more uplifting than teaching college kids. That's what I have
Speaker 1: found in it. No matter how cynical you get, right,
Speaker 1: it sort of it gives you hope. So enjoy that
Speaker 1: time back in academia. And I hope we talk again.
Speaker 2: Thanks so much.
Speaker 1: So I hope you enjoyed the conversation with Lena Kahan.
Speaker 1: I want to you know, one of the things that
Speaker 1: we dabbled in on is the issue of AI right
Speaker 1: and what what is government's role and how are consumers
Speaker 1: going to get protected as we advance in AI And
Speaker 1: as I was preparing, I stumbled on something. And this
Speaker 1: is going to be come across a bit self surfing serving,
Speaker 1: and I apologize in advance. I'm not usually interested in
Speaker 1: trying to insert myself into a story, says the guy
Speaker 1: that's trying that's broadcasting on YouTube. But I take anyway,
Speaker 1: So go ahead and stark at me. I get it,
Speaker 1: but in all seriousness. So what happened earlier this morning?
Speaker 1: I was preparing my interview of Lena Khan and I
Speaker 1: had interviewed Jonathan Canner, who was the head of the
Speaker 1: Anti Trust Division during the previous Justice Department, and it
Speaker 1: was an interview I conducted with him when NBC owned
Speaker 1: my podcast, And so I was looking for it, right,
Speaker 1: did the old fashioned Google search? Right, They're seeing if
Speaker 1: I could find it somewhere archive. I just wanted to
Speaker 1: see if I could find transcript something of it. And
Speaker 1: as I'm you know, I rarely I hadn't Googled myself
Speaker 1: in a while. I was just doing Chuck Todd podcast
Speaker 1: Jonathan Canter, right, And as I'm typing, you know, Google
Speaker 1: will helpfully give you other things as you type a
Speaker 1: person's name, and suddenly the words Duck Todd illness shows up,
Speaker 1: and I'm like, I wonder what that is. I was curious,
Speaker 1: so I hit it. And now, of course everybody has
Speaker 1: experienced the Google the way the Google pages work. Now
Speaker 1: you get the AI, you get Gemini's quick summary of
Speaker 1: the search in your thing. And so when you do
Speaker 1: Chuck Todd illness, here's what happens. The AI overview ends
Speaker 1: up saying the following. Chuck Todd, the former host of
Speaker 1: Meet the Press, is publicly disclosed that he has Parkinson's disease.
Speaker 1: He revealed his diagnosis in twenty eighteen after being diagnosed
Speaker 1: in twenty thirteen. While specific details about the progression of
Speaker 1: his illness are not widely publicized, there have been reports
Speaker 1: of symptoms like fatigue, any way changes, as well as
Speaker 1: a decrease in public appearances. Okay, there's nothing about this
Speaker 1: is true. I don't I'm not going to say it.
Speaker 1: I don't feel like i've been you know, this is defamatory.
Speaker 1: I don't have Parkinson's disease. I get a physical anyway.
Speaker 1: My point is, none of this is true. I've not
Speaker 1: had any illness. I would tell you. Is there something nothing?
Speaker 1: You know, I've had a few kidney stones that I've
Speaker 1: gone public with. I've not gone what I've gone. I
Speaker 1: think I'm up to nearly a year without a kidney stone,
Speaker 1: but I frequently get those. That's about the worst health
Speaker 1: problem I've had to deal with. And I'm sitting here going,
Speaker 1: wait a minute, this is in a this is the
Speaker 1: AI search. And then of course you can do Chuck
Speaker 1: Todd illness update. And then it claims Chuck Todd, who
Speaker 1: was diagnosed with Parkinson's disease in twenty thirteen, has publicly
Speaker 1: acknowledged his condition and has been managing it while continuing
Speaker 1: his media career. I have never publicly acknowledged this because
Speaker 1: there is nothing to acknowledge. And then it says he
Speaker 1: shared his diagnosis in twenty eighteen and has since been
Speaker 1: involved with the Parkinson Association of Central Florida, even serving
Speaker 1: as president in twenty twenty one. Not true, says Todd
Speaker 1: has spoken about his low gluten free diet. That is true,
Speaker 1: and his exercise routine. That is true, but everything else
Speaker 1: is not true. It appears that there is a gentleman
Speaker 1: with the first name of Todd who's involved with the
Speaker 1: Parkinson Association in Central Florida, So that got conflated. The
Speaker 1: point is is that here I am, who is going
Speaker 1: to you know, where does one go? I have sent
Speaker 1: a note to Google to say, hey, this is all wrong.
Speaker 1: I don't know how much more to tell you this
Speaker 1: is all wrong, and you know it's it's it gets
Speaker 1: into a large you know, this could have been something,
Speaker 1: you know, truly defamatory, could have been something horrendous. You
Speaker 1: could be accused of a crime. You know where do
Speaker 1: you who?
Speaker 4: You know?
Speaker 1: Do I can I control what is said about me,
Speaker 1: especially when it's not true what is said about me?
Speaker 1: And look, as somebody who's been a public figure, there's
Speaker 1: been plenty of garbage said about me that hasn't been true,
Speaker 1: plenty of garbage that has been set about my family
Speaker 1: that isn't true. And for the longest time we all
Speaker 1: just sort of ignored it. We figured, oh, you know,
Speaker 1: it sort of will go, you know, the non truth
Speaker 1: stuff just sort of goes away and dies. But what
Speaker 1: has happened with these all these AI tools, these large
Speaker 1: language models have trained themselves on the garbage that has
Speaker 1: been saved on the internet. So even if you know,
Speaker 1: take Gemini. In this AI business, it's probably eighty five
Speaker 1: percent correct, which is B plus right BB plus material.
Speaker 1: The problem is that fifteen percent that is wrong taints
Speaker 1: at all. And this is the inherent flaw right now.
Speaker 1: I think in where we are in AI, I hope
Speaker 1: this is a good lesson right, like the Grock incident
Speaker 1: with how quickly you know? And Elon Musk wanted to
Speaker 1: do He didn't like the answers that groc was giving
Speaker 1: and he wanted to give new answers, and suddenly he
Speaker 1: created a Nazi AI persona you know I. You know,
Speaker 1: maybe by sharing this story more people will to understand
Speaker 1: is that that AI is not all knowing A has
Speaker 1: got a lot more flaws right now, and an inherent
Speaker 1: flaw is what you the data you have trained the
Speaker 1: AI on right. And Google doesn't fully appreciate that there
Speaker 1: is a lot of garbage, particularly about public figures that
Speaker 1: isn't true for a variety of reasons, right, And nobody
Speaker 1: is saying they have to fact check everything, but you know,
Speaker 1: there's got to be some form of of truthiness that
Speaker 1: that is there, and a consumer, whoever it is, an
Speaker 1: individual has got to have some right to correct you
Speaker 1: know a right to get this, you know, because this again,
Speaker 1: I you know, this is not being accused of having
Speaker 1: a disease that you don't have, is not you know,
Speaker 1: it's not going to you know, cause me problems personal
Speaker 1: whatever it is, that's not the issue. I don't. You know,
Speaker 1: this is not fair to people that are dealing with
Speaker 1: Parkinson's whose stories should be told and who's you know,
Speaker 1: should be and things like that. So I just wanted
Speaker 1: to share this story because this is a warning. All right,
Speaker 1: AI is very flawed right now, Okay, I have a
Speaker 1: personal experience with it, and clearly Google's AI is not
Speaker 1: as and yet what is Google doing every time you
Speaker 1: do a Google search it produces the AI overview. First,
Speaker 1: I watch my son. He just takes AI overview and
Speaker 1: just assumes it's fact. And you know, like the early
Speaker 1: days of Wikipedia, there's a lot of manipulation still out there.
Speaker 1: I'm not saying that over time this won't get better
Speaker 1: as these AI, but to put it out there in public,
Speaker 1: I mean, this is what happens when these tech companies
Speaker 1: essentially want to test their technology out in public, sort
Speaker 1: of let it all crowdsource the problems away. Well, there
Speaker 1: are people that get caught up in that crowdsourcing of
Speaker 1: information where you may defame them, you may harm them,
Speaker 1: you may do harm to them, or you may cause
Speaker 1: them so much anxiety they do self harm. So I
Speaker 1: share the story. I hope Google. I am happy whoever's
Speaker 1: listening from Google, I am happy to participate. So you
Speaker 1: guys need to figure out why how this happened. I'm
Speaker 1: happy to help out in any way if I can
Speaker 1: help you, Because look, I'm not an AI skeptic. I
Speaker 1: want to. I want to. This is a probability. You know,
Speaker 1: I know what AI is. It's not intelligence, it's not
Speaker 1: you know, a robot. It is simply probability. Uh, it's
Speaker 1: it's a probability, uh, sample of of what you know,
Speaker 1: what's likely to be said next, what's the next word,
Speaker 1: et cetera. So I'm you know, I'm I am pro
Speaker 1: the concept of continuing to try to make this work.
Speaker 1: But it's possible. We haven't fully uh Uh. This stuff's
Speaker 1: half baked and it's being released to the public, probably
Speaker 1: in an attempt to try to catch up to the
Speaker 1: folks over at Open AI. Why why Google's doing this
Speaker 1: and all this stuff? And they're pushing it out there
Speaker 1: for for a variety of reasons on that. Maybe it
Speaker 1: has to do with making it look like they're on Hey,
Speaker 1: we have AI tools too, but I'm here to tell
Speaker 1: you this AI tool ain't working the way it's supposed to.
Speaker 1: And anybody that's been in the public space, like myself,
Speaker 1: who has had so much bullshit written about them, stuff
Speaker 1: that's not true. This is how it can all get
Speaker 1: cobbled together and create literally a fictional story that the
Speaker 1: only thing that is correct is that I've worked for
Speaker 1: NBC and my name is Chuck Tad. All right, let
Speaker 1: me deal with a couple of questions there. So, Helena Khan,
Speaker 1: I didn't I would have told you about that, but
Speaker 1: I didn't want to make the interview about that. But
Speaker 1: the FTC come on, Where where do we go as
Speaker 1: citizens to essentially correct when our persona is misidentified and
Speaker 1: miss h and frankly just wrong by the by by
Speaker 1: one of these big tech companies on this front. All right,
Speaker 1: let's do a couple of ask Chucks, Ask Chuck. Okay,
Speaker 1: first question comes from the Essa in Charleston, South Carolina,
Speaker 1: home arguably to one of the best eating towns in America,
Speaker 1: probably at least you know, in the top five, not
Speaker 1: tops of New Orleans. But it's if I said about Charleston,
Speaker 1: it's New Orleans without the refraff, and yet some of
Speaker 1: us do like the riffraff in New Orleans. Don't get
Speaker 1: me wrong, but here's the question. If the Trump administration
Speaker 1: is so adamant about deporting violent illegal criminals, why didn't
Speaker 1: they start by clearing out the prison system. Republicans love
Speaker 1: to use Lake and Riley as their example for ridding
Speaker 1: America of this dangerous criminals, but her killer, Jose Antonio Evara,
Speaker 1: is still sitting in a Georgia prison living off of
Speaker 1: taxpayer dollars. It seems that if Republicans were serious about
Speaker 1: cleaning up fraud, waste, and abuse, this would be a
Speaker 1: good place to start. Instead of rounding up migrant workers
Speaker 1: from the fields they are working in people off the
Speaker 1: streets who may actually be US citizens. Am I missing something, Vanessa,
Speaker 1: You're not. You know, I don't have a good answer
Speaker 1: to this question other than boy, that's a really What
Speaker 1: I want to do is send this over to whoever's
Speaker 1: going to interview Christino next. Right, this is a ter
Speaker 1: question that needs to be asked if I get an
Speaker 1: opportunity to ask anybody in the in the DHS system,
Speaker 1: whether it's Stephen Miller, who I may you know, whether
Speaker 1: it's for my newsphere show or here So I did.
Speaker 1: It's a terrific question and I want to know the
Speaker 1: answer to that, and hopefully somebody listening also wants to
Speaker 1: know the answer to that. That is a outstanding observation.
Speaker 1: Second question comes from Jeff H. By the way, like
Speaker 1: you know, if you're absolutely right sidey, that seems to
Speaker 1: be would probably I bet you if you pulled that question,
Speaker 1: should American tax dollars be used to how's criminals who
Speaker 1: are here illegally? I have a feeling I know how
Speaker 1: that would how that poll question would go. This next
Speaker 1: question comes from Jeff H. He says, what do you
Speaker 1: think about eighteen years for term elaments on senators and representatives?
Speaker 1: We've got to get people out of these positions before
Speaker 1: they become decrepit. Jeff, here's all I want to tell you.
Speaker 1: I'm on Monday next week. I'm dropping an interview with
Speaker 1: Larry Lessik, who is a Harvard Law School professor who
Speaker 1: is focused and he's got this campaign finance law that
Speaker 1: has passed in Maine that the Feds are that some
Speaker 1: are trying to say is unconstitutional. But if they successfully
Speaker 1: argue their case, he thinks he might be able to
Speaker 1: make super Pack essentially obsolete right by limiting all donations
Speaker 1: to super packs to five thousand dollars. I'm not going
Speaker 1: to get into the details of this, but in that conversation,
Speaker 1: Larry and I talk about the idea of a constitutional convention,
Speaker 1: because ultimately term limits would have to be put in
Speaker 1: the constitution. That the only way you can make it constitutional.
Speaker 1: And there's a lot of argument to be made. We're
Speaker 1: due for a constitutional convention. Deal with campaign money, right,
Speaker 1: things that the Supreme Court is said is unconstitutional, deal
Speaker 1: with campaign money, deal with age limits, term limits. It's
Speaker 1: you know, maybe you do it as age limits we have,
Speaker 1: we have age minimums to run for office, right, twenty
Speaker 1: five for the House, thirty for the Senate, thirty five
Speaker 1: for the presidency. I'd argue those are kind of obsolete now,
Speaker 1: you know, you know, should there really you know, maybe
Speaker 1: you just if you're eligible to be in Congress of
Speaker 1: twenty five, why is there you know, why make a
Speaker 1: difference on the Senate and the presidency at that point.
Speaker 1: But if you're going to put in age maximum, since
Speaker 1: age minimums are in the constitution, age maximums have to
Speaker 1: be in the constitution. So I think this is a
Speaker 1: is it eighteen years? I think eighteen years for instance,
Speaker 1: is a I'd call that a generation right? And is
Speaker 1: it eighteen years collectively? Right? That? Or is it eighteen
Speaker 1: years in each chamber too? That that's another question that
Speaker 1: some might have. But a good constitutional convention, balance budget
Speaker 1: amendments another thing where you might have some some people
Speaker 1: on the right want this, some people on the left
Speaker 1: want this, you know, just like the original constitutional convention,
Speaker 1: you would get some interesting compromises. And I'm going to
Speaker 1: leave it at there. This is the long one. And
Speaker 1: on that so I've got a bunch of other questions.
Speaker 1: We'll save it. We'll save it for We'll save some
Speaker 1: of them for next week. I promise you know me,
Speaker 1: I will get to all of them. That is the goal.
Speaker 1: All right. With that, I hope you enjoy your weekend
Speaker 1: and I will see you in about seventy two hours
Speaker 1: or so until we upload again.