Breaking Points with Krystal and Saagar - 6/20/22: Recession Warnings, Uvalde Coverup, Buttigieg Failures, Biden Fitness, Assange Case, Global Unrest, & More!

Episode Date: June 20, 2022

Krystal and Saagar talk about recession indicators, crypto markets, unionization efforts, Uvalde police coverup, Pete Buttigieg's incompetence, Biden's bike fall, Julian Assange prosecution, Krystal on Maher, global unrest, Biden & Jimmy Carter, and global inflation with Peter Zeihan!To become a Breaking Points Premium Member and watch/listen to the show uncut and 1 hour early visit: https://breakingpoints.supercast.com/To listen to Breaking Points as a podcast, check them out on Apple and SpotifyApple: https://podcasts.apple.com/us/podcast/breaking-points-with-krystal-and-saagar/id1570045623 Spotify: https://open.spotify.com/show/4Kbsy61zJSzPxNZZ3PKbXl Merch: https://breaking-points.myshopify.com/New Yorker Feature: https://www.newyorker.com/culture/culture-desk/the-rise-of-the-internets-creative-middle-class Peter Zeihan: https://zeihan.com/end-of-the-world/  Learn more about your ad choices. Visit megaphone.fm/adchoicesSee omnystudio.com/listener for privacy information.

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Happy Monday. We have an amazing show for everybody today. What do we have, Crystal? Indeed, we do. Lots of stuff that is breaking this morning. First of all, we have some new comments from some of our leaders, including President Biden, about whether or not we might be heading towards a recession. Very telling comments indeed. We also have a new union, Apple Store Workers Outside of Maryland. Big deal. Forming Apple's very first union. So that is exciting. We'll give you those details there.

And whether or not the fact that the economy is sliding off of a cliff may impact that wave of labor organizing. We also have some, I mean, you just can't make it up the stuff that continues to come out of Uvalde. Cover up. Now they are. I mean, it really is like a whole of state cover up at this point from the governor all the way down to the local officials trying to keep the public from ever seeing body cam footage. But we do have some sources within the investigation revealing some important details, some new lies about exactly what went down on that horrific day. We're also learning more about just how screwed up the airline system is.

Price gouging, scheduling flights that they know they have no prayer of ultimately staffing. We also have Pete Buttigieg in a position to potentially do something about it and basically not acting. So we'll take you through that. You guys probably also saw President Biden taking a spill off his bike. It appears to be fine, but raising new questions about whether or not he should run again in 2024, if that's the Democrats' best chance. And we also have some new troubling developments in Julian Assange's case. They're continuing, you know, the U.S. and the U.K. government continuing to push for him to be extradited here. So we've got all of that for you. Also, Peter Zaihan going to be back here again. Of course, there are a lot of things that he can get into. But we want to focus in particular on how we may be entering a new phase where inflation is a lot higher than it used to be as globalization sort of is going away in certain respects.

So it would be interesting to talk to him. But we wanted to start with these latest comments. With regards to the recession, we heard from Janet Yellen. She's, of course, the Treasury Secretary, about whether or not she thought there would be a recession and also how long she thinks inflation is going to hang around. Let's take a listen to that. I don't think a recession is at all inevitable. Chair Powell, clearly inflation is unacceptably high. It's President Biden's top priority to bring it down. And Chair Powell has said that his goal is to bring inflation down while maintaining a strong labor market. That's going to take skill and luck, but I believe it's possible.

I don't think a recession is inevitable. Prices are going to go up before they go down, right? Again, most economists expect the inflation rate to move up to around 7 percent by the end of the year. Does that sound about right to you? Well, we've had high inflation in the first half of this year, and that locks in high inflation really that the pace of inflation is likely to come down. Although, remember, there are so many uncertainties relating to global developments. So there's a lot to read between the lines here. I mean, first of all, it's never a good situation when you're using language like, well, it's not inevitable. It's not inevitable.

It's like, OK, so what are we talking, like a 5% chance of avoiding it, a 1% chance of avoiding it? So there's that. And then there's also the fact that, you know, in spite of the fact the Fed's taking some pretty extraordinary action now, increasing the level and the pace at which they're lifting interest rates, there's still every expectation that inflation is going to continue at least through this year. And what does that mean? That means the Fed will continue to act and potentially continue to escalate those actions. Ultimately, since that's basically the only thing that we're doing to tame inflation, that means they are coming after, you know, you,'ll get to in a little bit when we talk about unionizing, I mean, that is part of what has enabled a lot of the activism across the country. So yes, of course, we have to get inflation under control because it is devastating to working class people. But when we only lean on the Fed to do it, we leave a lot of things off the table. And by the way,

where we are at this point, a lot of that, to the extent that the extra stimmy checks in the accounts and whatever help to spike inflation, a lot of that is burned off. There are a lot of that, you know, to the extent that the extra stimmy checks in the accounts and whatever help to spike inflation, a lot of that is burned off. There are a lot of other issues that we're facing that are causing inflation. The Fed has nothing to do with it. Yeah, I mean, we see that all in the credit card data. We see it in all the increased borrowing and the cooling off of the housing market. Even in terms of demand, Americans are beginning to curb both restaurant and gas use, meaning that quality of life is declining. And I'm not saying it's a right, but any time that you have to have to diminish your quality of life in order to make basic ends meet, viral videos going around of people saying, I got to choose between food or gas this week.

I mean, that is a horrific position in order to be in. You also see that the talking point originated with Biden himself. Let's put this up there on the screen. He did his first sit-down interview, finally, with the Associated Press, only 30 minutes. But actually, he was pressed on inflation. Here's what he said. First of all, it's not inevitable whenever it comes to the recession. So we see that that bled into the Treasury Secretary's comments. Secondly, he says, quote, we're in a stronger position than any nation in the world to overcome this inflation. Then he pivoted to

defending himself and saying that we have the strongest job market since World War II, and that we have 3.6% unemployment rate, and talked about wages. I don't know why they continue to go to this post-World War II talking point. You know, this is a good parallel, actually. Consumer sentiment post-World War II was actually terrible. We had very high inflation at that time, and Truman nearly got kicked out of office for it because there was massive chaos in the labor market. Because once again, global events, you come out of a crisis, it spikes huge problems, and it sparks real questions like, what exactly are we going to do as an economy, and how are we going to conduct commerce coming out of this? And Biden doesn't have an actual answer for that. And this just gets to what you're pointing to. There's only two ways really to, quote unquote, solve inflation. You can induce a recession,

which is basically what the Fed has decided to do. Or you can try and deal with many of the supply side factors. Well, guess what is much, much harder to do both politically, but would actually solve the key problem in the future. Because this is the thing, even with inducing a recession. Recession to the extent that it can, quote, solve inflation, that just means that you're going to reduce demand for everything across the board and hurt all business. Okay, I mean, I guess that means the price is down, but you know, 1979 was a miserable year. 1980, we actually went into one of the most painful recessions since the Great Depression in 1981, which is a direct result of the Federal Reserve.

And to the extent that inflation was even, quote, solved after that, it was mostly a result of the global cooling off on the oil markets and learning how to deal with OPEC, the Iranian Revolution, and all of that. So even there, the Iran-Iraq war probably had more to do with solving inflation than the actual Federal Reserve. I'm reading a book about the 70s right now, so it's very well read up on this. Well, yeah, and Sagar will be talking more about that in his monologue, The Parallels. We've both been pretty fascinated by the parallels lately because even within the left group in fighting, there were parallels. There's just a lot of strange parallels going on. But, yeah, I mean, there was one other detail in this interview with Biden that's a little bit of an aside, but I think the audience would be interested in it, which is remember how they hung the portrait of FDR in the White House. This was a signal like, I get it and I get the challenge and we're going to have a new, new deal and I'm taking on the mantle of Roosevelt. Well, you learn in this interview that he actually had nothing to do with it.

It was, I guess, John Meacham that hung it there. And he looked at it and said, why Franklin Roosevelt? Not that I don't like Franklin Roosevelt, but why put that big portrait of Franklin Roosevelt? And Meacham said, no one ever inherited that kind of big circumstances and dire, more dire straits than he did that last time. And I said, oh, that's encouraging.

So anyway, apparently Biden never really embraced this FDR thing. I think that's pretty clear at this point. But go ahead and put this next tear sheet up on the screen, because this article, I really recommend people actually go and read the whole thing. It's from David Lynch at The Washington Post. Fed's interest rate hikes may mark start of tough new economic climate. And I'll read you a little bit of this. So they said, for 40 years now, the formula for U.S. economic growth has been the same, cheap money. And that has been led by the Fed. Consumers could borrow easily to buy homes and cars.

Companies, whether profitable or not, could tap bond investors for cash to fund their operations. Washington could afford to bail out both Wall Street and Main Street by running eye-popping budget deficits made possible by borrowed funds. Now, with the end of that easy money regime, you're in a very, very different era. So, I mean, you remember not that long ago, the sort of conventional wisdom was stock market only goes up. And you can understand why people felt that way, because we had a crash during the coronavirus crisis, but it was very short because immediately the Fed leaps into action to backstop everything. And so even as much of the economy was on hold, I mean,

people were at home, there was very little that was actually happening. The stock market kept going up and up and up. So you were seeing these twin headlines of like, you know, massive unemployment, massive numbers of people filing for unemployment claims, and yet stock market at record levels. So there was just very recently this assumption that, oh, you can't lose, right? I mean, this thing is, it was fake. It was completely divorced from any kind of reality. It was backstopped and propped up by the Fed. Now that's being pulled back. And so we're going to talk in a minute. Of course, crypto has taken it on the chin. But you had asset bubbles in basically every category. Now the air is coming out of the tires in every single way.

That is leading to a very new reality. I mean, you've had, they say now the total value of debt that's considered distressed by S&P global ratings has nearly doubled over the past month to $49 billion. That includes securities for companies that you know and have heard very much about, Rite Aid, Bed Bath & Beyond, they mentioned. So, you know, this is a pretty extraordinary shift. And I think it really remains to be seen how the economy handles it, because we've had effectively zero interest rates for the Fed more or less for quite a while now, certainly the last decade. The amount that they have propped up these asset classes has been

extraordinary. By the way, that's part of what fed inflation. I know everybody loves to talk about what went to consumers and regular working class people, but there was far more money, trillions of dollars that was injected into to backstop the markets that fed inflation ultimately also fed massive inequality. And so now as they try to unwind that, it's going to be you may not have benefited from that on the way up, but it is going to be pain all the way around. If the only way we can get out of this cycle is for the Fed to trigger a recession, which is where we're headed. Yeah. And I just – emphasizing again, there's actually a decent quote here by the chief research officer at Barclays Bank, where she's like, look, the truth is that the economy – this economy is designed to run off of low interest rates. And so we are reshaping the fundamentals of all of the Fortune 500 companies and the way that they are going to have to behave,

all the way from the fact is now that higher interest rates mean that they are going to have to spend more in paying down their debt. Two, they're not going to be able to freely borrow in order to invest in any of their actual resources, in capital, both in equipment. Their expenditures are going to be able to, probably going to go down as a result of this. This also means, though, that they have to protect their stock price. To protect their stock price, there is only one way to do that whenever money is expensive to borrow. You have to cut costs, which will mean you have to either cut wages or not give wage increases to keep pace with inflation, or you have to fire people. And unfortunately, I think that's the direction that we're going to be heading in. And it really is a result of government policy

and of the Federal Reserve. It will have broad impacts on everybody's retirement portfolios, on your ability to borrow. More importantly for all of you, I think we're listening to the show, is just the sheer ability in order to get hired and the labor market mobility that we saw over the last two years, which was extraordinary. And, you know, we're about to get to the labor movement. It could cripple the labor movement. You know, if you see unemployment tick up, which is the explicit goal of the Federal Reserve right now, well, what does that mean? I mean, it means that you're going to have less of a competitive of a job market. So you put all that together and it's a grim picture for people. I don't think there's another way to say it. There's no doubt about it. And, you know, all that, the froth and the excess that were in the markets that fed things like these zombie

companies, which are losing money every single quarter, but because they can borrow money so cheaply, they're able to make their interest payments and kind of continue to limp along. You had the massive growth of these SPACs, special purpose acquisition companies. They call them blank check shell corporations that avoid a lot of regulation. A lot of those sort of spectacularly failed. And so because you had these massive trillions injected into the market in this way, you created all of these things that now are being pulled back dramatically. And I don't think anyone knows exactly how this is going to play out because we've never been in exactly this place before, even though there are a lot of parallels with the 70s.

We've not ever been exactly in this place before. And, Sagar, something you've been pointing to is the consumer sentiment. I mean, if you just ask the American people how they're feeling about things, it is not good at all. Go ahead and put this up on the screen. You can see the best sentiment here they show in this chart, they say was in 2000. And this goes back to, it looks like about 1950. The worst sentiment is now. Right now. So worst sentiment now than even during, you know, financial crash 2008, 2009. And the 1970s of high inflation. And the 1970s, good point. Literally the worst consumer sentiment on record in the United States.

And people just don't seem to grapple with that. It's why Putin's price hike doesn't land. It's why best economy since World War II doesn't land. Unless you are speaking to that sentiment, you are not going to be a successful politician. And Biden, the administration, they have no answer for this. They continue to just be dawdling. They don't appear in step with the broad problem of Americans. I've been saying this now, we've been saying this now for what, a year? It's like, I don't know how long it takes to learn, and I get these stupid leaks coming out of the White House. Jeff Stein had a story over the weekend about how one idea was to give people gas rebates in order to spend on gas, which would have been a problem

given that you don't deal with supply, but they couldn't even do that. Why? Because we don't have enough semiconductor chips in order to make that happen. So even their stupid idea is not actionable because of a supply problem that they also – and Congress refuses to address. It's too perfect. And then there's also just – this is another thing that Jeff Stein tweeted.

They've been considering this for four months. Oh, my God. Four months. And they're still apparently considering it. Right. It's like, shit or get off the pot. I mean, honestly. It doesn't matter. Think about this. Not just on this not just on this student loan like all these things they float them they

think about they agonize them it's like jesus christ people are suffering now take act even if it's experimental like i mean that's part of what fdr did was like we're just gonna throw everything against the wall we're gonna figure out what works what doesn't work but we're gonna act we're gonna try things we're gonna be creative and think outside the box. And I think that more than anything has hamstrung him. Because if you look at the trajectory of his entire career, what has he always done? I mean, he's always tried to locate himself in the safest, most centrist part of the Democratic Party. And there's no answers there for a situation like this. I mean, that's why his only move here, he put on his op-ed of, oh, here's my plan,

et cetera, et cetera. It boiled down to, eh, leave it to the Fed. Leave it to the Fed. That's it. And the only thing the Fed can really do is trigger a recession that massively hurts you and doesn't even deal with the real core of the reasons that we ended up in this situation in the first place. It is a sad, sad state of affairs, ultimately. Yeah, that's right. Let's talk about crypto. Well, some brutality in the crypto markets. Let's put this up there on the screen. Bitcoin falling below $20,000 for the first time since 2020. This is just a broad problem in the entire market, from Bitcoin to Ethereum. On Saturday, at one point, Bitcoin was down to $17,000, which is the lowest that they've seen in well over two and a half years. You also had Coinbase, one of the largest trading platforms for crypto assets, laying off 18% of its staff, citing the recession and crypto decline specifically as the reason the bank Celsius, remember, which we talked about previously, which was pausing all of its withdrawals. And also there's a hedge fund, which as a result of both crypto and the broader stock market decline had major challenges. So you put all these together,

presaged by that Terra USD coin, the decoupling of the stable coin that we talked about previously, and you see a contraction of almost $7 trillion in wealth in decline that you've seen over just the last couple of months. All that put together just spells real doom times, I think, for some of the biggest froth in the crypto community, both from NFTs to some of the high interest loans that people were taking out. Actually, I saw an interesting story about how with crypto, and I warned about this before, people, which is that people were staking their crypto on behalf of cash loans. So based on the present value of their asset. Well, then the banks and other of these crypto banks started doing margin calls once the asset declined and nobody would pay up on their margin call. And because all of this isn't, none of this is regulated under

the SEC or FDIC, and so they don't have a lot of, I mean, they have some legal recourse and they can try and settle it eventually through lawsuit, but you either have the cash on your balance sheet or you don't. And that was part of the reason why they had to pause that. We'll point this New York Times story up on the screen, which everybody's trying to point to, you know, what exactly is happening in the crypto markets. And they're pointing really to tether the decline and the unpegging away from the stablecoin as a real indicator of just where so much of the froth had been concentrated. And I think this is really a peelback, both in the economy and also in crypto, back to fundamentals. I mean, five years

ago or so, when I got into the crypto community, I told this before, it was about censorship-resistant money, and it was about trying to hedge inflation in places like Argentina and others, where they have like 60% hyperinflation to have a semi-stable asset that people can conduct commerce in. But then it became like blockchains, which became architects for all of this complicated financial instrumentation that Wall Street was using. Massive loans were flying around. And look, for a time, mega billionaires are being made. You know, Sandbank, there are hundreds of billionaires that became minted in just the last two years. I guess they're not billionaires anymore, but were on paper at least at some point. So there was a lot of real wealth being generated. And then the decline in that from NFTs and more, my concern is not with

the people who are billionaires and now 100 millionaires. It's with normal folks. You know, we talked about on Reddit and others, people, specifically many influencers and celebrities like Paris Hilton and like Reese Witherspoon and other people were chilling NFTs to their fans and getting paid huge money in order to do so. By the way, they're getting paid in cash, just so we all know. Yeah, for sure. Those people are getting paid in cash and convincing people to put their life savings into non-fungible tokens. I'm not even an unbeliever in the underlying technology of it, but the sheer matter is that when you're spending hundreds of millions of dollars on these platforms,

you're going to get caught holding the bag. And unfortunately, that is what happened to a lot of average people. They also point to Latin American countries, which were buying either Bitcoin or crypto currencies as part of their balance sheets as heads against inflation, El Salvador being one. Well, they're in serious trouble now because of the decline in asset. These are developing countries which need that money. They are not the reserve currency in order to pay for different expenditures and other things in their own country. So the decline has had very real world consequences, even for, I saw a story on Terra specifically. Again, in Argentina and some other countries

where they have hyperinflation, people put their life savings in these assets because they said, at least I can invest in something which is pegged to the U.S. dollar, which is more stable than my own currency. And now they're left with almost nothing. So it wiped many normal people's savings completely out. Now, that's why you shouldn't go in on any asset class, but there you go. I mean, a lot of—that's true. A lot of—I mean, and a lot of the people involved here were ultimately just fraudsters and hucksters. Yeah, many people.

I mean, there were, you know, tons of just pump-and- and dump schemes and rug pulls and all kinds of just outright fraud. Not to mention part of this article about Tether, which I had actually followed before, is the fact that, you know, the whole idea of Tether is that it is backed by U.S. dollars. So that was that was the claim. And then Letitia James, who's the attorney general of New York, who's gone after all kinds of different people, Amazon and Facebook and Trump and all kinds of others, she said, I don't think this is true. And turns out it wasn't true. There was also a CFTC investigation that found out of their sample timeframe that they were looking at, only about a quarter of the time did Tether actually have sufficient cash reserves. Now they say, okay, we have transparency now, and sure, a lot of our reserves are held in commercial paper, which isn't totally liquid, but we're working to change that.

There was a bit of a run, because this is effectively, even though there's lots of complicated jargon here and newfangled ideas, it ultimately comes down to this is basically a bank, and there was a run on the bank. And they were able to get through that, even though it de-pegged for a while. So they're saying, hey, that means we're good to go. But there's still a lot of questions over whether if things continue to crash. I should say crypto is, I think, up a little bit this morning from the lows that we experienced just recently. But if there is a serious crash and there's an even more serious run on Tether,

are they going to be able to ultimately stand up? And this is one of the sort of bedrock underpinning of the entire crypto world. So if Tether were to fall, you'd have massive spillover effects into all kinds of other things. And so that's the part that they're looking at here. I think the kicker to this article kind of says it all. Because as you said, you know, the idea, I really understand the appeal of the initial idea, right? I genuinely do. And for a long time, it's very crypto sort of

just agnostic, because it was interesting, right? And I think in certain situations, like in countries that are kind of destabilized, hyperinflation, whatever, the whole idea, okay, this will be a hedge against inflation. Well, we can see very much now that that is not the case. The original concept is this will be an actual medium of exchange. Well, it turned into just a massive speculative asset that is not backed by anything. And I know a lot of crypto believers will say, well, the U.S. dollar is also just based on an idea. But that's not true. We have the largest, like the largest military in the world is backing the U.S. dollar. The U.S. government is not amazing these days, but the United States of America isn't

nothing. So it is a very different scenario here. And ultimately, to the point of a lot of this just became about gambling in a casino and finding the next greater fool, the quote at the end of this piece, they say, everyone's freaking out. Like, oh my God, I lost my life savings, said Mr. Collins, who founded Tether with Mr. Pearson, now runs a crypto venture called BlockV. That's a tragedy. But it's just as much of a tragedy when someone says, I went to a casino and lost my life savings. That doesn't mean let's regulate casinos out of existence. So even their advocates are basically comparing it to a casino right now. By the way, casinos, extremely highly regulated also. That's true. Yeah, that's actually, yeah. I mean, there's the Nevada Gaming Commission

and all kinds of oversight, even though I do think a lot of those are very exploitative. I mean, listen, at the end of the day, it was speculative. And one of the warnings always at the top was, if you get in, you better be willing to lose it all. I don't think a lot of people were actually told that message. They just saw people making extraordinary amounts of wealth. And I think a lot of these people, specifically influencers and others who were pushing their average person into some of these assets without understanding any of the underlying risk. Yeah. That was the major problem. I mean, I think I'm pretty sure any time I've advocated Bitcoin, I've been like, listen, I've at certain points been down up to 100 percent.

And that's something that you should know. The day that I bought Bitcoin, I anticipated losing every single dollar of it. But I was like, you know, this is kind of interesting. I didn't do it to make money. I was like, this is a cool project. It's an interesting idea. And the idea of censorship resistant money, especially whenever we point to, you know, the Canadian protests and others with crypto, although the government did end up seizing that, just showed me, I was like, huh, that's a cool use case. But if you did it in order to try and go number go up, it's like, well, then that's equivalent to investing in some penny stock scheme. Yeah.

Well, and even some of the idealism turned out a lot of the people involved, you know, they said what they thought was convenient for their own bank accounts. So like Sam Bankman Freed, for example, if you're truly invested in like the libertarian ideal, I would think that going and influence peddling with the Democratic Party and other powerful political officials, kind of anathema to the best case for that worldview. And yet that's exactly what he was in the process of doing. I think ultimately Stoller makes the case for this in a piece that posted over the weekend in order to make sure that when the bottom falls out, their behinds are ultimately protected. They didn't manage to pull that off in time. There was an incredible, I recommend, apparently it was controversial, the piece that Stiller put out, but I think it's worth watching and you can judge for yourself. But he does have a clip in

there that's pretty extraordinary of one of these big boosters who's like, take all your life savings and put it in crypto. The smartest thing you can do is put everything you have in crypto. And if you don't have it, mortgage your house, take out credit cards. You need to spend all day, every day thinking of how you can get every single penny you possibly can into crypto. Like that's the level of insanity and irresponsibility. And just, I mean, it's so wrong to say that to anyone about literally anything, let alone something as speculative as crypto. Yeah. It would be wrong to say that about the dollar too. Okay. Anything, literally anything. Okay. So I mentioned a couple of times, we have a new

development in the labor movement that is pretty exciting. So the first ever Apple Store has now unionized. This is in a suburb outside of Baltimore, Maryland. Let's go ahead and put this up on the screen. This is from More Perfect Union. They say, breaking in a historic victory, Apple Store employees in Maryland win the first union at Apple despite a nationwide anti-union campaign by Apple management, workers voted overwhelmingly, 65 to 33, to unionize with, I think this is the, the Twitter handle here is at machines, T-S union, machinists, I think. Right. Yeah, that's right.

So, anyway, I think it's like United Machinists of America, something like that. Okay, so Apple workers on side of Baltimore unionizing. Very exciting. It's interesting in the video that More Perfect Union talks about here. They interview the workers, and some of them said, you know, I've worked here for a long time. Before the pandemic, we had a horrific situation. You guys remember when Apple was caught basically degrading their old phone batteries so that people would be forced into new phones? Who's taking the brunt of the abuse from customers who are pissed off, rightfully, about what's going on? These Apple

store workers, pre-pandemic, I'm sure if you guys have ever been in these, they're totally packed. I always find a very stressful environment. So they're in there day in, day out and felt like they had no say in the conditions of their workplace and just having to, like, take this abuse from customers and, like, no way to really deal with it. Then, of course, the pandemic presents a whole other level of challenge. And they talked, too, about how they were really inspired by it. They saw what happened with Amazon. They saw what happened with the Starbucks workers. And that sparked the idea of, hey, if they can do it, we can do it too. So that was interesting.

I mean, of course, the thing I'm very worried about, though, is there's a lot of factors for why right now you see all this grassroots labor movement organizing, workers saying, hey, we're not going to quit our job. We're going to stay here and organize. I think the biggest factor underpinning that is, number one, you have some natural leaders who have kind of galvanized the movement. But number two, you have, for the first time in a long time, the amount of productivity gains actually going to workers going up. And so you had workers in an actually comparatively strong position because there

are lots of jobs out there. There just aren't a lot of good jobs. So that gave them a lot of leverage. It's not easy right now to hire replacement workers as it has been for most of my life where people could just be treated as disposable. If we end up in a recession and the Fed is outright saying we want to cool off the labor market and depress wages, well, that's going to really make it a lot more difficult and take a lot of that leverage out of this burgeoning movement. So Bloomberg had an article about this. Let's go ahead and put this up on the screen here. They say Fed's inflation battle to strip workers of rare bargaining power. Tight pandemic labor markets made employers offer better deals, but cure for soaring prices may mean higher unemployment too. And again, this is not speculative. This is, you know, outright what they are saying

and what they are telling you. So the fact that we've had a little bit more power flow to workers, that could all very easily be reversed because ultimately, you know, when you're just desperate to have a job, any job, it's a lot harder to take that risk of unionizing. We've seen how companies have been shameless about firing workers who get involved in these efforts. I think that the Great Recession is a good reminder of this. You know, when employment, unemployment was like 10%, that was actually one of the periods where unionization and pushback against both union rights and worker power was at its highest level. And it was capitalized on, obviously, by a lot of anti-union movement. And it was specifically because they had the ability in order to mass replace workers. Now, look, unemployment is only 3.6%. And of course, every business that you go to has a help wanted sign. But as you begin to see contraction, and if specifically, if you start to

see firings or worse, not new hirings, putting back on hours, people closing their stores, and not posting new listings, that's when we're going to see major issues. And it almost always starts at the lowest end of the income spectrum, which is where we've seen some of the highest growth. So you could see a real yo-yo effect of 2019, not a lot of power. There was a tightening labor market, certainly. But then 2020, 2021, that didn't have a particular amount of impact. And then when unemployment really begins to rise, that is when power goes away. And it goes away very quickly. I don't think we should really underestimate how fast the Federal Reserve and some of this monetary policy can

trigger a recession. It can happen within six to eight months. I mean, by some measures, we're already in recession. Personally, I don't even like these economic metrics like bear market at 20%. It's very arbitrary. Yeah, it is arbitrary. To me, it's about people. Ask people how their... People are the economy. We are the ones who conduct commerce. When people tell you they're the lowest consumer sentiment on record, that's a recession, in my opinion, because it's not even just about their spending. It's about expectations. Expectations are one of the biggest parts to manage inflation. And you can see you have the Treasury Secretary saying it's not going to come down anytime soon.

Biden, I mean, there's no plan, as I can see right now, to do anything about it, which is going to drive people to be even more pessimistic, which means that they're going to pursue or consume less gas, maybe buy less stuff, not invest in new things, not buy a new house because of the mortgage rate. That's where everything starts to bleed into. I mean, having it I mean, we put that one tweet up there last week where someone was like, I have a 1.75% mortgage. Like I'm not moving. And whenever mortgage is 6%, I'm just not going to sell my house. Well, that is a lot of people right now. Same with cars. I mean, I don't know if anybody's seen the used car market recently. It's out of control. I mean, you know, like a basic SUV is going for like $45,000, $50,000. That's complete insanity. So it's very tough for people right now. It is. And what we have seen routinely is, you know, with the people at the top, it's like heads they win, tails you lose.

When, of course, the market crashes and assets collapse and, you know, housing is a lot cheaper. Like for them to take on the higher interest mortgage, well, they don't even have to because they have to, they have enough sufficient capital to just be able to buy up distressed assets so that when things rebound, they get richer and richer than ever before. So, you know, I mean, on the other side of in terms of if the labor surge will continue, which I think has been really exciting and is a representation of actual true democracy and giving people a sense of autonomy and power within their day-to-day lives. Some of I think that has come not just from the changes in the labor market and the very

low unemployment rate, but I think it also has come from a genuine shift in how people are thinking and relating to their work after the pandemic. I think part of it has come from a young generation that was inspired by the Bernie Sanders movement and, you know, the focus on the working class and on the labor movement that was sort of like a re-education for a generation that is kind of, because labor unions have been crushed almost out of existence, has been kind of disconnected from labor. So I do think that there are other factors at play that aren't just related to like the baseline metrics of the economy.

There's just no doubt about it, that this landscape will make things a lot more difficult. Okay, let's talk about Uvalde. So some new and interesting revelations. Let's start with the first and the foremost, which is that, let's put this on the screen, Uvalde and Uvalde police have hired a private law firm to fight against being required to release body camera footage and other records related to the school shooting. They say that files could be highly embarrassing and involve emotional and mental distress. I mean,

I think it probably caused more emotional mental distress whenever little children were killed because you weren't doing your job. And the city is now working with this law form to not just release body camera footage, which I mean, I guess you could make an argument about that, but this is specifically about all records related to the mass shooting. This is a letter that they were actually given in response to public information requests. Obviously, reporters and everyone else across Texas has been trying to FOIA body camera footage, photos, 911 calls, emails, text messages, criminal records, and everything. and they are blocking every possible thing that they can because the city has not voluntarily released one scrap of information as a result of this. And here's the thing, which is that the city is now actually asking Ken Paxton, who's the attorney general, who we'll get to,

for a determination on what information is required to release to the public, which apparently is the standard practice in the state of Texas. So the Texas AG now has the ability to determine which and any, if all, records should be released. They're hiding and fighting behind this lawsuit. Meanwhile, the Texas Attorney General and the governor have the ability right now in order to release all of this to the public, which it certainly should be, in order to make these gentlemen be held to account. Remember that guy, Pete Arradondo, the chief of Uvalde CISD police? He remains completely unavailable to the public. He's been dodging reporters. Their hope is all of us will just completely move on. At the same time, the San Antonio Express, doing some great journalism here,

let's throw this on the screen, they have a source which says that the police never tried to open the door to the classrooms where the Uvalde gunmen had kids trapped. Now, we had some indications of this in the official timeline that was given eventually that came out on how they were all holding outside, about how eventually Border Patrol had to ask and go and get the key in order to try and enter the classroom. But this makes it official. Surveillance videos show they did not try even once in order to open the door to the classrooms where the gunman had the kids trapped for 77 minutes. There also are major questions here. Why was that door unlocked in the first place in addition to the back door? Remember, originally, the cops tried to blame a teacher. They were like, oh, a teacher put a brick or something in the door while they went

to go get their cell phone out of their car. No, surveillance video and the lawyers of the teacher contested that, and it's been confirmed now that she actually closed the door. She didn't do anything wrong. And they show also that perhaps the classroom door had been both unlocked during the classroom, but also the school door. And all of this just points to not only total and gross incompetence on behalf of the police officers, but now full-fledged cover-up by the state. Yeah, no, that's right. And it's at every level. And remember this dude Pete Arradano.

He's now on the city council. Yes, right. So he's involved in making these decisions at the city level as well in terms of how they're going to approach this and what they're ultimately going to release. But it sure appears like from the bottom all the way to the governor, we're going to get to the AG and the governor in just a moment, they want to completely stonewall the actual details of what happened that day coming out. And we have already seen so many lies that they have had to pull back. You just have to wonder, like, what else could they possibly be hiding?

Because this is complete insanity. I mean, this thing about the door. I'm just, I'm beside myself. Because Arradondo, remember his lawyer came out and said, no, he was trying every key. And with every key was just prayerful and hopeful that it would unlock the door. Well, the way he said it, it made you think, right, that he was trying the keys on the door to the classroom the gunman actually is. No. According to this source, he was trying the keys on a different classroom door to see if he could find a master key that might unlock all of the doors.

Okay. The doors, remember the gunman went into one classroom and then there was an adjoining door, so he was able to get into two classrooms and massacre almost all of the kids and the teachers that were in those two rooms. Well, one of them, it appears like, had malfunctioned and was unlocked. Because remember, these doors were all supposed to automatically lock once they're closed. Now, it looks like the way the gunman was able to get in is because one of these locks, the back door locked malfunctioned. Now, one of these classroom

door locks malfunctioned. So he was able to waltz right in. They are saying in the investigation that he would have been unlikely to be able to lock that door himself from the inside. So the whole time the cops were standing outside the door, it was unlocked. All they had to do was turn the doorknob. I mean, that's, that just, I can't, I can't even believe every time we get a new revelation, I just cannot believe the callous, cowardice failures of every single one of these people. It's mind boggling. And a police source actually says, surveillance video confirms that the officers all had access to a crowbar tool that could have opened the door to the classrooms. Right, so even if it was locked.

Even if they wanted to. If you wanted to, you could have gone in there even if it was locked. Even if it was locked, they could have tried to blast their way in there. They could have tried to open the door. They waited 77 minutes. I mean, all of this is just a massive screw-up. Not even screw-up. Willful, almost, incompetence.

I don't even think we know the half of it yet. Yeah, I agree with you. I mean, the lengths they're going to to keep the body camera footage and all of this from coming out. I don't think we even know the half of it. And one of the experts they point to as well said this is kind of the problem with the body worn cameras. You know, the idea is this like police accountability. But in reality, oftentimes the police departments themselves who basically get to decide what gets released and what doesn't. So, of course, in a situation where you had sketchy behavior or outright violations of their code of conduct or even illegal behavior, somehow the police

department finds a way to say, oh, we'd love to, but we can't release that particular footage. And, you know, that's part of the story of what's going on here, too. And then in terms of Ken Paxton, let's throw this on the screen. The Texas Attorney General says, well, God always has a plan whenever he's asked about the Uvalde shooting. Look, I just think that it points to this guy needs to step up for Texas. Him and Governor Abbott need to have a full-fledged actual investigation, get all of the records and the police footage, everything out, edit it together, and explain to the citizens of Texas what went wrong here. And this is not throwing, you know, everybody under the bus. It's the people who are responsible. Root them out of government, throw their asses out of office,

appoint new people. Frankly, Uvalde PD should probably be disbanded. At the very least, Uvalde CISD. And the state should step in. And, you know, we have- Defund the Uvalde police, that be disbanded, at the very least Uvalde CISD, and the state should step in. Defund the Uvalde police, that's what you're saying? Well, I didn't say defund it. I said, road, take it away and put some new people in there. And in the meantime, the Texas Department of Public Safety should step up. You know, even apparently the school itself has yet to reopen. I mean, there's just so much that needs to actually happen down there. And I think a lot of it is being forgotten.

And I, unfortunately, you know, look, what happened is that we had a national conversation or whatever about gun control. We have a supposed deal which may come by the end of this week.

Looks like that's falling apart. Yeah, right. That looks like it's falling apart, which at the Texas GOP convention, as I said, you know, John Cornyn, I thought he was going to face some trouble over this and he was booed on the stage and is apparently getting significant pushback over the red flag provisions of the law.

But all of this has foregone that a lot of the public I think is still very interested in this, but I think the national media and the conversation is continuing to pass these kids by. And these are really the most direct way that we can at least hold the people responsible for what they did. It's the very, very, very least that could possibly be done. And just to read you the whole Paxton quote here, because he got asked specifically by a pastor what he would say to the victim's families. He says, I'd have to say, look, there's always a plan. I believe God always has a plan. Life is short no matter what it is. Yeah. Come on, come on. And then the last piece of this is, I think we did our best to give the governor, Greg Abbott, credit for admitting, you know, saying he was furious about the way that he had been

misled because originally he came out and disseminated the lies that were being fed to him. And you all know how that original timeline just completely fell apart. Multiple lies, multiple shifting storylines. So he says he's ultimately livid. We'll go ahead and put this piece up on the screen. So the Texas Tribune and ProPublica have submitted about 70 requests to state and local agencies for emergency response documentation surrounding the mass shooting at Robb Elementary most likely will not be released publicly for months if ever. Greg Abbott's office specifically and the Texas Department of Public Safety, the U.S. Marshal Service, and the city of Uvalde are asking the state's attorney general for permission to withhold records that may offer tangible answers to the contradictory accounts. So again,

whole of government cover-up from the local officials, the police department, the city council, all the way up to now we know the governor of Texas and the U.S. Marshal Service trying to block the release of records that would finally tell us the truth of what actually happened that day after being fed so many lies. Yeah, they need to, like I said, stand up for Texas, stand up and show the country, you know, what really happened here and try and take charge of the situation. So I just think it's such a catastrophe. All right, guys, a little update on the summer travel season, which is not as frivolous as my lead there makes it sound. Go ahead and put this tear sheet from Politico up on the screen. So Pete Buttigieg, our great transportation secretary, he says the U.S. might act against airlines on consumers' behalf.

So apparently, and I'm just learning a lot about this, the transportation secretary, which is what Pete's job is now, actually has a lot of power to go after airlines who are abusing consumers. And what we are seeing take place repeatedly now, this summer, there was a whole Memorial Day, complete debacle, thousands of flights ultimately canceled. Turned out the day I was flying to LA with Kyle, we got very lucky because that ended up being one of the worst days of the year also for flight cancellations. 1,700 some flights canceled. The next day was almost just as bad. And not only that, what it turns out is, you know, obviously in the summer there's weather,

there's issues. We all get that. And sometimes it's ultimately unavoidable. But what it looks like is happening is these airlines don't have sufficient staff to man the flights that they are scheduling. So when you're booking your flight, they basically know in advance we're not actually going to have the pilots or the crew available to fly all these flights that we are booking. So they are knowingly screwing you over, and then you're in a taxi on the way to the airport, and you get that text that your flight is canceled. And then they don't have anywhere near sufficient customer service representatives to get people rebooked. They're screwing people on the price. So they have escalated ticket prices way beyond what ultimately is justified

by their legitimate increase in cost. And they are ripping consumers off when it comes to there are regulations about when you are required to give a mandatory refund, either because your flight is canceled or because you suffer an extraordinary delay. And they're sitting on, you know, trillions, billions of dollars that they are supposed to have given to passengers that they instead dupe passengers into accepting like, oh, we'll give you a credit for future travel instead. So Pete could be doing a lot about this. And ultimately, all he did was meet with the airline executives, sort of quiz them on a few things and say,

oh, well, I want to see how July 4th goes. And then here's the part that's kind of funny. The very next day, this is from Matt Stoller, after Transportation Secretary Pete Buttigieg met with airline leaders to, quote, quiz them about widespread flight disruptions, his own flight was canceled and he had to drive from Washington to New York. The last piece here, this is a fantastic piece from American Prospect written by Robert Kuttner. Go ahead and put this up on the screen. So the title here is Pete Buttigieg's day job, the ambitious transportation secretary, has the power to go after multiple abuses by the airline and signal administration support

for suffering consumer. He has barely touched it. This goes through a lot of what I just said about the price gouging, about the intentional staffing issues, about, of course, they want to pass blame. And I think there is also blame to go here with the FAA, which falls also under Pete's, you know, the FAA's short staff. That's causing problems as well. But the last thing I'll say about this, which really sticks in my craws, they say, he points out, remember, the airlines are saying, oh, we're having trouble getting pilots. It's so hard, et cetera, et cetera. First of all, there's actually a surplus of new pilots. There are plenty of pilots available to

be hired. Second of all, you might recall, we gave the airlines a massive $60 billion bailout explicitly under the promise that they would not lay off their people. So what did they do instead? To technically comply with that provision, they instead pressured and incentivized their pilots to retire so that they could keep some of that bank for themselves. So they got around that rule, and now when they're like, oh, we don't have enough staff. Well, yeah, because you pressured them out in spite of the fact that you got a bailout custom designed to keep your staffing levels where they are supposed to be. So anyway, they're evil, they're screwing you over, and Pete's not doing anything about it. That's a major cluster on everything.

I mean, even – this is, again, where I look at this, and I'm like, okay, to the extent that it's an FAA problem, okay, fine. Then call people up out of the – you know, the military has a ton of air traffic controllers. Last time I checked, Florida, every national guard in the country all has these people, which we've done many times in the past. Disaster. Reagan did it in the traffic control strike back in the day. It's not hard in order to try and fix. Have an incentive. They won't even backfill that. It's like these are the things, the very basic mechanics of government, where both pushing back and trying to crack down on consumer exploitation by the airlines, in addition to having, I think, serious ground delays as a result of FAA. It's a cluster. Also, jet fuel doesn't help any of this, which I've

talked about previously. Reading the Robert Kuttner piece is just extraordinary. It always just reminds me the government is very powerful when it wants to be. I mean, it certainly has all of this, you know, so much regulatory authority going back all the way to the days of the 1970s, which is written into statute. But we just don't have competent people who are trying to have balance and look out for consumers. So Buttigieg was here, was explicitly humiliated by the airline industry. They basically just don't care what he has to say because they think he's full of it. And are they wrong? I mean, they can probably just continue to get away with it. Is the Biden administration really going to do anything? It's very basic

things like this that make you feel like your country and your society is just falling apart or fraying. When you have flights, 1,700 flights or something a day getting canceled, it's the peak of the season. Hundreds of thousands of people are traveling. TSA travel is like 90% of what it was pre-pandemic. International travel is booming. There's no like COVID test requirements and all this right now. And yet, you know, every time I've flown during the pandemic, there's always one or two things that go wrong for no reason. And you end up waiting forever. And it's just one of those, you're like, why, why is this happening? It's just a complete like fraying of all of this and air travel, you know, air travel, I think in the 2010s was a basic, just bedrock of it. Yes, it was miserable and it was annoying that you have to

pay for bags and Coke and all that, but it became an unpleasant but generally accessible experience to most Americans. And I think a lot of that is slipping away both on price and in terms of inconvenience, which remember, this has impacts on people going to funerals, people going to weddings. It's not like time off is doled out in this country. Every day you get burned for people who have honeymoons or a lot of people getting married. I was actually reading about how many people's honeymoon plans are getting destroyed. I mean, look, people spend thousands and thousands of dollars and they can't arrive on time or whatever. So, look, there's major life impact to these things. Every delay, every cancellation ripples through.

It's not just like rich businessmen. It also shows you the problem of putting someone who has like, whose only aspirations are for their own political career. Yeah, he has no competence, zero. In charge of an agency. It's not just he has no competence, which is true, but he also has no incentive to take on powerful interests in industries because that could come back to bite him in terms of his political career. And that's one of the things Kuttner points out here is, oh, Pete's happy to travel around and hand out checks and pose it like a ribbon-cutting ceremony, doling out the money that was passed in the infrastructure bill. But when it comes to tackling head-on a powerful industry interest, for some reason there,

he's completely hands-off. He never brings it up, and his testimony rarely gets asked about it, even though, you know, again, this is an area where he has tremendous power, and the airline industry is just outright screwing people over. So just to give you one small example of what he could do. He could demand that he be given from the airlines their records of what their staffing levels are and how they're going to staff all the flights that they're booking. So instead of just sort of quizzing them on a Zoom or whatever he did and saying, ah, I hope you guys have a plan now for July 4th. I'm going to wait and see. He could actually demand the records because we know they've been foolish in the past and see how are you going to cover all these flights that you

are booking. But of course, he's not. He's not doing that. Said he's just getting his own flight canceled and having to drive places. Yeah. Humiliation. Total. America is being humiliated by American Airlines and all of them. Yeah. OK, let's get to it. The fall. Obviously, this happened over the weekend, President Biden, how'd you say it took a spill off of his bike? I don't know what I said. Let's take a look. Let's all watch the video. For those who are just listening, don't worry, it's only eight seconds. Let's get to it. So the president there falling off of his bike. The excuse that they're – I'm not saying he's lying.

I honestly don't ride bikes, so I don't know a lot about that. But he says he got his foot stuck whenever he was unclipping his foot from the pedals. I've done a lot of biking. Anyway, go ahead. I've done a lot of biking. It looks like – it doesn't look like his feet are clipped in. Like, you know, you get the shoes, those of you who are Peloton riders, too, it's the same thing. The shoes that clip into the pedal.

It looks like he just has the little baskets that your foot goes into. One of them he, you know, pulls out no problem. The other one gets twisted up in the basket. Right. Okay, so here's what they're saying. He got his foot caught in the toe clip at the top whenever he was trying to put his foot down. And that's what resulted in him falling. Now, this is just broadly indicative of, and of course, you know, it was capitalized on by, it is very hard to watch. Of course, he's the president, you know, he's an 80 year old man,

and I don't want to see any 80 year old fall. It is though coming on the heels of a broader conversation in the U.S. press right now, which is finally sanctioned, is Biden might just be too old to be president or at the very least to run for president. Again, let's throw the next one up there on the screen. This was like a big breakthrough article for the D.C. press, which is Mark Leibovich writing in The Atlantic why Biden shouldn't run in 2024. For those who don't know Leibovich, he's an interesting guy, kind of curmudgeonly. He wrote this book called This Town back in 2010, which kind of lambast, it was like a bonfire of the vanities, Tom Wolfe takedown of Washington DC culture, the uber rich who run politics here in the city. But he writes in here, frankly, he just seems old as a direct quote from a senior administration official.

And he just says, he says even to put it bluntly, Joe Biden should not run for reelection. He is just too old. Biden will be 80 in November. He will be 82 if he begins a second term. The numbers keep moving more ridiculous from there. It's not 82 that's the problem. It's the 86, as somebody said recently in a focus group. And again, not to take anything away from the accomplishments or the livelihoods of elderly Americans, but look at Dianne Feinstein. Anybody who knows somebody who is old knows that when you're this

age, things go real quickly. You know, even a fall, it's a serious issue. I was telling you before, the number one cause of death, this is according to the CDC, accidental cause of death for 65 plus Americans is falling. You could break a hip and you could die very quickly. People go very, you know, off the rails whenever they're very old and they can deteriorate. And that's why you should try and take care of yourself,

lift weights and all that to prevent that from happening. But he's already on that side of 80. lift weights and all that to prevent that from happening. But he's already on that side of 80. Look, he looks good for an 80-year-old. It's impressive that he can even ride a bike and he seems like relatively physically fit for his age. But that doesn't take away from the fact that it is uncomfortable to watch when this is the leader of the free world.

And there are many instances where having these types of spills and others publicly are major political problems because Americans aren't stupid. They hold nothing against elderly Americans in the aggregate. They have to consider it, though. It's our duty to consider it when you're entrusting somebody with an enormous level of public service. And that's why I just think it's dishonest when the Biden defenders and all of them are like, what are you talking about? Like, who hasn't fallen off the bike? Listen, do I need a PhD in exercise science to say that Lance Armstrong falling off a bike is different than an 80-year-old falling off a bike? It's not the same. And it shouldn't be

uncomfortable even, and knowing that I'm going to get attacked for even doing this segment, in order to talk about it to people. Like this is our job. We have to acknowledge these uncomfortable truths about people who are in public service. Here's what I say is it should be for sure a factor that people are allowed to consider, allowed to talk openly about. I don't think like Leibovich kind of floats in here like maybe we should have an age limit for politicians. I don't believe that at all. In fact, if it was up to me, I might lower the age limit at the bottom end, because ultimately you have to have faith in democracy and allow people to make their own decisions about who they think is best capable. So even with Biden,

would I take, you know, a clearly aging and not in his prime Biden over a Kamala Harris or Pete Buttigieg? Yes. Okay. Way happier to have Biden in there, especially right now with the Ukraine war not that I'm happy with exactly how he's done it, but he has resisted some of the most maximalist, most insane hawks within his own administration and within the deep state. I don't know that Pete or Kamala would have done the same. So I think that's one factor that people should be able to consider and discuss openly. I think these politicians should have to subject themselves to rigorous questioning from the press, to rigorous debates, so that you have an ability

to actually assess what their capability is in order to do the job, you know, as opposed to like Dianne Feinstein, part of how she's still able to be in there despite notable, notable decline, way beyond, you know, what we're seeing with Biden here, is because she doesn't have to face the public ever. So very hard for the public to get their hands around how she's faring at this point in her career, ultimately. So that's my view, is it should be a completely acceptable, open part of the discussion that we can all engage in. You know, is he up to the task? Is he up to the task today? Do we think he'll be up to the task four or six years from now?

And what are the alternatives? And let's measure them up against each other. So I'm just in favor of, like, more democracy, more engagement on these issues so that people have a full range of options and can sort of balance these various pros and cons of various all very flawed people. I think, you know, the only push I would give on that is look at California. California is a one party state rigged primary system with Dianne Feinstein and the political elite there run the state, sadly, like an oligarchy for 55 or 50 or so million people. They're covering up Feinstein, you know, Nancy Pelosi, Padilla, all of her colleagues, Gavin Newsom, everybody knows she's senile.

And yet they don't do anything about it. Well, not only do they not do anything about it, they cover for it. Yeah, they cover it up. And remember, progressives wanted to primary her. Yes, and they said no. And they, you know, they did everything they could to quash that out of existence. I mean, ultimately, there's no workaround for having a functioning democracy. That's just the bottom line here. She can't remember things. to quash that out of existence. I mean, ultimately, there's no workaround for having a functioning democracy. Yeah.

That's just the bottom line here. She can't remember things. Like, again, I feel bad for her. She just lost her husband. It's probably extraordinarily difficult. You've been in public service your whole life. This is all you have left. I know why you want to cling to it.

I don't blame you for wanting to do that. However, you represent the interests of the largest state in the country. And those people have a say and deserve competent leadership and government on their behalf. How do we know that her constituent services are even close to the level that they should be? Well, you can't say that. But again, with Biden, like consider the alternative. I get it.

Would you really want him to be like age limited out and then we're like, I guess we're going to have President Kamala Harris now. No. So I think it's better to push for more democracy, to push for mandatory debates, to push for, you know,

the press to actually do their job with regards to this than it is to put in sort of arbitrary limits that may leave us with even worse choices. And to the press, the press, of course, has to bear a ginger. They're like, he fell, but he's totally fine.

Let's put this on the screen for Dave Portnoy, which I thought was particularly hilarious. With the amount of bike apologists coming out of the woodwork to defend Biden, saying falling on your skull happens all the time, you'd think they'd ban bicycles in this country. People out here making it seem like bike riding is more dangerous than swimming with sharks. Look, just be honest with people. That's all anybody wants. Everybody can see.

I think bike riding is actually more dangerous than swimming with sharks. Actually, yeah. I bet there are way more. I mean, there are definitely way more bike deaths than there are shark deaths. How many shark deaths are there? Not many. Not many. So, actually, I think it is more dangerous.

Yeah. shark not many not many so actually i think it is more dangerous yeah we should work to have a society where bike lanes are more protected and where people can bike more safely but it is actually but bikers that also means that you can't be annoying and just cut people off for no reason i'm not just speaking you know uh out of turn here in washington dc i'm pro biker i mean generally but uh sometimes they're really annoying okay let on. Okay, this is a very serious story here with regards to Julian Assange. And I think it's always important to remind us of the context and the backstory here. Of course, Assange had a WikiLeaks. They have released information that was very uncomfortable and damning in certain circumstances about both Republicans, George W. Bush in particular, and Democrats, Hillary Clinton in particular, in the U.S. context. But they are not just a U.S.-focused organization. They have released

embarrassing information about almost every country on the planet. The Obama administration hated Julian Assange, hated WikiLeaks, wanted to persecute him, wanted to prosecute him, and his Department of Justice said, you can't do it without also criminalizing the act of journalism and publishers like the New York Times. Trump administration comes in and after considering assassination plots, they decide to go with the more moderate approach of let's indict him and let's prosecute him under really a quite novel legal interpretation, which really, I mean, this is truly an attack on journalists, on publishers. If you criminalize Assange, you are effectively criminalizing the act of journalism. Biden administration comes in and

decides to continue that same prosecution. So that's where we are today. Julian is in a prison in the UK, and he has been going through a series of legal battles to try to prevent being extradited to the United States where he would face trial. They experienced the latest setback just last week. Let's go ahead and put this up on the screen. I have to tell you guys, I do not understand the UK court system. This is confusing as all hell to me, but I'm just going to read you from this article. The headline is UK government orders the extradition of Julian Assange to the US, but that's not the end approved the U.S. government's request to extradite Julian Assange, the Australian founder of WikiLeaks, faces 18 criminal charges of computer misuse and espionage. That decision means Assange is one step closer to extradition, but has not yet reached the final stage in what has been a years-long process.

Patel's decision follows a March decision to deny leave to appeal by the U.K. Supreme Court, affirming the high court decision that accepted assurances provided by the US government included there were no remaining legal bars to Assange's extradition. But as they point out in the article, there are additional appeals that Assange can ultimately pursue here. And WikiLeaks has already announced that they will, in fact, appeal the Home Secretary's decision in UK courts. He can appeal on an issue of law or of fact, but has to get leave, has to get permission of the High Court in order to launch that appeal. They do expect that this appeal will include some new information, including my aforementioned reports of plots to assassinate Assange. There are also some legal issues, including whether or not these charges were political offenses that may be considered that haven't exactly been considered in the past. And then even if those appeals are exhausted, there is still one other potential place that

they could go, which is to the European Court of Human Rights, where Assange could take a human rights action and try to ban this extradition as well. One other wild card in here is Assange is an Australian citizen. Australia has been kind of hands off as to what they want to do here. But they do have a new prime minister in Australia who's from the Labor Party, Albanese. And he's been more pro-Assange. So does he kind of get involved here? Hard to say. Hasn't happened yet, but we'll see. I think that's actually a wild card, which may have the most amount of success given that he is a citizen. And they point to there has been an

instance where there was an Australian citizen imprisoned in Guantanamo Bay who actually was brought back by Australia after consular pressure by Australia on the United States. So that is not without precedent. Politically, very interesting to see who is speaking out against this. Real horseshoe here. This is horseshoe in particular. Let's put this on the screen. From Marjorie Taylor Greene.

If we really care about the First Amendment, we should care about Julian Assange. Freedom of the press is the protection of the ability to expose the truth and publish it. This should always be protected, and this freedom should always be handled with the most respect. Assange. Freedom of the press is the protection of the ability to expose the truth and publish it. This should always be protected, and this freedom should always be handled with the most respect. If they are upset over the Khashoggi killing, they should be upset over Julian Assange. Is the American press afraid to speak out on behalf of the U.S. tradition of Julian Assange? Is it because it's not a government prosecution or an attack on a journalist, but yet our own. The ruling regime in America persecutes their enemies in order to strike fear in anyone who dares expose corruption

and stand up against it. What happens when everyone becomes too afraid to tell the truth and publish it? Silence will protect evil. Wow. Alongside one of her House colleagues, Ilhan Omar. Let's throw this on the screen. Here's where she goes and said,

the prosecution of Assange is still indefensible. She's quote tweeting one of her previous clips that she made in December of 2021 where she clipped out Mehdi Hassan making the case for why the prosecution of Assange is indefensible. So this makes them two of the most high profile members of the U.S. government who have spoken out on behalf of Assange. I mean, people don't forget, like in the Senate, I believe not even Rand Paul has spoken on behalf or at least tried to get a pardon for Julian Assange. He did try for Edward Snowden. The politics of this were very dicey. And frankly, most people were afraid of crossing the CIA and the intelligence community after in 2017, they branded WikiLeaks like a foreign intelligence association. So people in Washington know that if you speak out on behalf,

you could have some serious problems in terms of what you want and push back against you by the national security state. So it is actually genuinely courageous for two members of Congress to do this because it's extraordinarily uncommon. I guess what I want to see is, okay, I do appreciate them saying the right things, but are you going to pressure the people in your own party to take action? I mean, if you're MTG, what are you going to say to Donald Trump? He's the one who started the prosecution here. If you're Ilhan Omar, do you have any leverage within the Biden administration that you can use to actually press the case here? So while I appreciate the words, these are also people who are in positions of power and have influential friends who might be in a position to do more than just words.

Right. And Trump didn't actually pardon Julian Assange when he had the chance back in 2020. He was asked to specifically. His administration started the prosecution. Multiple times. Yeah. And then he decided not to pardon him. And Biden is continuing that Trump era prosecution rather than going back to what Obama had said and saying, listen, we can't go after this guy. Right. And you even remember, there was that Congressman Dana Rohrabacher who tried as well from California. I think he even met with Assange when he was in the embassy. But anyway, he also tried in order to get a pardon and and Trump, at the end of the day, refused to do so. Biden

continuing the prosecution. The DOJ under Biden has said repeatedly that they're pro-press freedom and all of this stuff. But in general, the Merrick Garland DOJ has taken on a pretty hawkish prosecutorial tone towards any dissent, be it domestic and towards Assange as well. So it's a troubling thing for the security services to set that precedent. We have a clip here of Assange's wife speaking out on his condition. Let's take a listen. Julian Assange's wife, Stella, is with me here in the studio. What is his state of mind? What is his health? Because it has been suggested that if he were to be extradited, he could take his own life. Well, his health is deteriorating by the day. He's been in Belmarsh prison for over three years. He's not serving a sentence. He's just there at the behest of the US government who wants to extradite him to the United States to serve a

life sentence. He's struggling every day is a struggle. In October, he had a mini sentence. He's struggling every day is a struggle. In October, he had a mini stroke. He's going through extremely stressful situations. Last night, I spoke to him, and he had extreme anxiety. He hadn't slept all night when I spoke to him today. And after the decision came down, they took him to a bear cell, and he's going to be there until Monday, and strip-searched him. It's easy to forget. You know, I mean, the principle and the attack on journalism is extraordinarily important, but this is a human being with a family whose life has been destroyed and put in jeopardy.

I mean, he suffered a stroke, as Stella says there, and it's devastating what has been done to him ultimately. And there's a lot of concern right now about the future of democracy in this country. And I think if you really care about such things, obviously free press, essential to the functioning of democracy, and this is the most direct attack on free press that is ongoing in this country right now. It's just a terrible precedent to set. It would criminalize a lot of acts of journalism.

And it's the last thing we need in this country when we're in the middle of such fraught times. So there we go. Okay. At the same time, we had a viral moment, Crystal, schooling some people on the Bill Maher real-time experience. Do you want to describe it for people before we throw to the clip? Yeah, so as you guys probably know, I flew on to L.A. over the weekend, and I went on real-time with Bill Maher. It's such a—I don't know why that just stresses me out.

It's a very different— A lot of lights and audience and all that stuff. Yeah, there's a live audience, and you fly all the way out there to do it, and you know that you've got to be super, super punchy to get your points in because— It's like TV. Yeah, and you know it's also going to be combative and confrontational, which stresses me out too. And we're so used to having the time and space— To talk.

To talk and go down any avenue we want and think out loud and kind of like, you know, and have things taken in good faith and all those things. And like this, you got to be on and on. So I was extremely stressed out going into this. But ultimately, you know, we talked some about January 6th and that conversation was fine. You know, I wanted to talk about some of the more underlying issues because that's what we do, and that wasn't really – there wasn't really the time and space for that. Interesting. Then we got into inflation, and I got very combative, I guess, with the, in my mind, very simplistic explanation that this is all just about the money that was given to working-class people. And the point I wanted to make, which I think is something that you guys are familiar with watching this show, is, okay, we can talk about that. And I'm not dishonest enough to say that that has nothing to do with the inflation we're facing. But we just completely ignore the trillions

of dollars that went to the top that helped to fuel inflation. Somehow that's fine. But God forbid you get a stimmy check in your bank account. So that was the point I was trying to make. And that was also the moment that has gone now at this point, actually super viral. So let's take a look at that. Well, I mean, part of this inflationary problem is because we put too much money into the economy. There's way too much government spending, and that's why we have inflation. So that's a large part of that. It's just basic economics. That is not basic economics. We had this thing called a pandemic. We had a supply chain crisis. And oh, by the way, there's a war in Ukraine. It's played a role.

It's played a role. So to act like the only reason we have problems now is because people got a little bit of money in their bank account is just not honest. And you, a little bit of money? They got more than we spent in World War II. So you don't act like the pandemic. But hold on, hold on. Whoa, whoa, whoa, whoa. Hold on.

Don't act like, you said don't act. Don't act like we had to react to the pandemic exactly the way we did. We had to spend $6 trillion on the forever flu the trillions that the Federal Reserve shot at Wall Street? For some reason, people don't get upset about that. And that fueled the trillions of dollars the Federal Reserve shot at Wall Street to backstop the stock market and the bond market. No one gets upset about that, even though that was a massive factor in inflation. I don't know what you're talking about. What do you mean shot at Wall Street? What are we talking about? We're talking about buying assets, buying stocks, buying bonds, buying treasury bills.

When? So that they expand the balance sheet. This is during the crisis, the coronavirus crisis. When the stock market crashed, that is what the Fed did. They went into action. They shot trillions of dollars. But the stock market didn't crash during. Now it's crashing.

It's crashing now. It crashed and the Fed came in and backstopped it. That's what happened. It crashed and we never heard about it? No, it crashed. Go back and look at it. When? It fell off a cliff.

When? The treasury bond market stopped functioning and the Fed took extraordinary action. It's never taken in history. I don't remember that. Somehow no one gets upset. What do you mean the first week of the pandemic? Somehow nobody gets upset about the rich people who got tons of money and tons of support, way more than working class people did.

Sure they did. But oh my God, people were able to feed their kids and they had a little bit of money in their bank accounts. It was the worst thing in the world. No. That is one small part of the inflation story and is, by the way, not the only thing that we can deal with to get out of this mess.

Is it a small part, Jimmy? Gas prices we can largely attribute to an administration that's been waging war on the fossil fuel industry. That's ridiculous. U.S. production is up. It will be at record levels next year.

The fossil fuel companies themselves are flush with cash but will not invest in new drilling because they would rather give it to their shareholders. That's the truth. So there's a lot going on there. That's very stressful. Also, the stock market crash in March of 2020. Like what? What are you talking about? Well, I actually, I get why you might have forgotten because the Fed leapt into action.

But that was such a seminal moment that really determined our trajectory everywhere since then. Because remember, the politicians, they were actually, it was unclear that they were going to do much of anything for anyone at the time. Remember, we were, I mean, we were beside ourselves. I'm like, they may not act at all. And then once the market crashed, that's when they were like, ah, shit, we got to do something. And of course, the overwhelming amount went to the top, as it always does. But they had to sweeten the deal with some stuff for regular people. Remember, at the time, there were all those stories about senators who sold everything they had, who sold a bunch of their stock before the crash so they could avoid the fallout.

So the crash ultimately was very short exactly because of what I tried my best to explain there in a very short period of time of the extraordinary action that the Fed ultimately took. And that's why you ended up with these dueling headlines of, oh my God, the stock market's at record levels, but meanwhile, unemployment is also at record levels. The reason you had that dueling reality is because of the Fed's actions there. And so if you don't understand that history, you're gonna have a hard time understanding what's unfolding before us right now. Yeah, I just think that,

I don't know how you could have forgotten that crash. I mean, crash just think that, I don't know how you could have forgotten that crash. I mean, crash, even today, the headlines are all largest stock market crash since the 2020 crash of coronavirus. Actually, I just looked, 2020 market crash even has its own Wikipedia page. And actually at the time, there were Black Monday one, Black Thursday,

and then there was Black Monday two, where they specifically talk about how on February 17th, that's when the Asian markets began to crash as a result of reports coming out, not only of China, but South Korea and initial lockdown procedures. That's what triggered massive market sell-off. March of 2020 leads to the eventual discussion around stimulus checks, of lockdowns. April of 2020 is when all of this gets solidified into place. By May, it's largely forgotten and cheap capital floods the system. But that was a pivotal economic time. I mean, we are going to study that period. Economists are going to study

that period for decades. That is equivalent to quantitative easing post Great Recession, equivalent to Great Depression-type monetary policy. And yeah, like you said, I guess I could forgive Bill for not remembering it. But even, yeah, I mean, with great respect to Jamie Kirchick and all of that, this is the issue with not understanding markets, both oil markets and stock markets, as to the exact mechanisms. Because if you want to sit there and talk about demand inflation based upon stimulus checks and overstimulation, fine, yeah, we can have that conversation. But to what extent is it part of the current solution?

Actually, not really, as we pointed out here. The stock market and the demand inflation, that stuff is mostly gone. Consumer demand as a result of stimulus checks and savings and all of that has tapered off. The current solution and to what we're grappling with is an extraordinarily different and difficult time that doesn't have a lot to do with what happened in March of 2020. So yeah, It's a captured discussion. Yeah, and I think it also, it reminded me, I'm so used to existing in this ecosystem. Yeah, it's different. And, you know, and I know that you guys who watch regularly, like, you're very aware of this. We talk about this stuff a lot.

We've gone out of our way to really dig into kind of the workings of the Fed this year. Yeah, we read a lot. Because it's so central. Like, we've really tried to challenge ourselves to understand on a deeper level what's happening in the oil markets, what's happening with inflation, what some potential solutions are, what the truth is and what the talking points from both sides. We're not perfect. We really try to understand in depth what's happening here. But a cable news format just doesn't allow for that. No, it doesn't. It does not allow for that. How long was that segment?

Like seven minutes? On YouTube, all it said was seven minutes. I don't even know. I think the entire panel discussion they said was 30 minutes. It felt like it was nothing. And we covered, you know, three or four different topics within that time period. And you got, you know, obviously a lot of crosstalk and getting cut off and all that stuff. So to try to make a nuanced point and explain the trajectory of how we got here and all these pieces that are going on, it's just – and that's on real time.

You have way more space than you do in like a cable news segment. Yeah, that's why I don't take cable. So that's why the American people are being fed a very non-nutritious diet in terms of understanding these seminal moments that really have been instrumental in getting us to where we are and determining where we're going to go next. And that market crash and the response to it was an absolutely crucial one. So listen, I had a great experience. I'm really grateful for them having me on and giving me the ability to do my best to explain the world as I see it and some of the things that we talk about on this show. So I'm extremely grateful for that. Bill couldn't have been nicer. After the fact, they do a little, you know, little like get together on the patio, open bar, whatever.

So I got to chat with him a little bit. And that was really nice as well. But I will tell you the other thing that was funny, which I've never done this to myself. I really have never done this to myself before. But I had such a hard time gauging whether I did well and got my points off or not. That's interesting. And so I really – and I hate watching myself back. I really should have watched myself back because if I did, I would have been like, okay, I did okay.

I got my points across. But I tortured myself that night like, oh, man, I think you, like, there's certain moments in I was replaying. I'm like, you should have said this. You should have said that. Maybe you came off in a bad way. Like, maybe you were too aggressive. I really, really was torturing myself. And I've been thinking about why that is because I really genuinely normally don't do that.

Even when I have actually performed kind of poorly, I'm usually like, ah, what are you going to do? But I think it's because I really did put, feel a sense of responsibility to represent us and represent this community and like the way that we look at things and try to put that out in the world a little bit. So I really, like I felt this pressure to do that, not just like like, for me to do my bus, but to try to represent what we're doing. I totally get what you're saying. I would also be incredibly stressed out. I was really stressed.

Because, yeah, like you said, I mean, I see these people. I know these people. I've known Jamie for a long time. I don't know Bill, but I do know their worldview. And it's so dramatically different than all of us that dealing with it and confronting it on national television yeah which is i mean look i'm not going to say it's a forte because you came up more cables you're used to more of the time but not having the ability to explain myself and have to hit the talking points is the thing i hated most always yeah about cable and having to return to that

after having the freedom here of talking in the way that we do would be very difficult and i don't think there would be another way to do it than the way you did, which is to have to be combative. I mean, to the extent that we ever cut things off on this show, it's because of studio time, like literally because we're like, we have to get out of here in order to produce our show on time. That's it. It's not because, you know, I often feel that they restrict it artificially in order to induce these results. I really do think it's suboptimal at the best for discussion. The first thing I noticed when I shifted from cable news to YouTube and to independent media is that you just have so much more space and so much more attention from the audience to lay out more complex arguments and points. You know, I write a monologue for cable news. It was like, I can hit one point. I can hit it a few

times. That's the best you're going to do. With this, obviously, you guys know how we write our monologues. And, you know, we put a lot into it. They go in a lot of directions. We try to make them, you know, complex and nuanced and really try to get at whatever it is that we're trying to explain. So in any case, I think it was useful, judging by the reaction, which has been extraordinary. Yeah, it went very viral. I think it was useful to go on, even though it really stressed me out. But I am also extremely, extremely grateful for the time and the space and the attention from you guys and the, you know, and what you guys, what you guys give back to us also allows us to kind of bring our best to the show. So thank you for that. I agree. Crystal, what are you taking a look at? Well, the bread

riots have arrived. A state of emergency has been declared in Ecuador, where a general strike sparked by mass inflation enters its second week. The country's president, Guillermo Lasso, a conservative businessman elected just last year, imposed the decree on Friday after mass protests led by the country's indigenous communities blocked roads, burned tires and demanded price freezes and loan forgiveness. Not only do these protesters want fuel prices lowered and frozen, but they also want the same for essential goods and services. We are literally starving to death. There is no work. Farm products are minimised.

There is no proper support from the government. With the rise in fuel prices, everything is more expensive. The government doesn't hear us. Does it hear the poor farmers? No, it doesn't. Does it know the price of fertilisers? No. And our products are already cheap. How are we going to survive to feed our children? So Ecuador's indigenous communities, they overwhelmingly grow that nation's produce, and they've been devastated by rising oil and

also rising fertilizer prices. The country's farms are heavily dependent on fertilizer from Russia. So in addition to being hard hit during the coronavirus crisis, Ecuador is now suffering with huge spikes in the cost of food production. And they are far from alone. Reuters lists Argentina, Chile, Cyprus, Greece, Guinea, Indonesia, Iran, Kenya, Lebanon, the Palestinian territories, Peru, Sri Lanka, Sudan, and Tunisia, all as nations where significant protests and unrest have erupted over spiking food and fuel prices just in recent months. So to give you a flavor of that, according to Reuters, Cypriot farmers dumped tons of milk and lit bales of hay outside the presidential palace in the capital Nicosia on May 18th in protest at high prices and production issues. Lebanese

truck and bus drivers and others blocked roads in January to protest against soaring prices. The protesters accused politicians of failure to address an ongoing economic crisis since 2019. And nationwide protests in Iran have continued since early May in response to a government decision to cut bread subsidies. Those protests have triggered a brutal government crackdown that has been harsh enough to trigger alarm among UN officials. Of course, the specifics are different in every country, but the overall picture is pretty similar. COVID despair, political dysfunction, and escalating inequalities provided the tinder, and massive inflation caused by supply chain crises, the war in Ukraine, and the West's response to the war in Ukraine lit the match. As grain prices rise and hunger spreads, we should expect even more instability. The Horn of Africa, the Middle East, and North Africa have suffered the

most brutal consequences from a combination of climate crisis, Russia's war on Ukraine, and again, our response to that war. Western sanctions on Russian banks have made it impossible for countries dependent on their grain and their fertilizer to buy either of those things. As a result, 50 million people are facing famine, 750,000 already in what is described as catastrophe. Many of these are in Afghanistan because we stole their country's central bank reserves, and in Yemen where our friends the Saudis have used U.S.-made weapons to cause the worst humanitarian crisis on the planet. Our guest today, Peter Zaihan, has been among those who are sounding the alarm, warning that we are facing a massive crisis with likely unrest.

He actually predicts this current food crisis will grow to three to four times worse than the crisis that triggered the Arab Spring. This is a devastating picture. It's feeding desperation and populist discontent around the globe. It's hitting poor, middle class, and wealthy nations alike. And by the way, citizens also expressing their outrage at the ballot box in Colombia. Vot voters tossed the dominant elite ideological faction out of power in the first round of voting, opting instead for a second round choice between a leftist former militant radical championing a Bernie-style agenda and a Trumpian businessman known for his TikToks, his invading against corruption while being under investigation for corruption, and his seeming lack of knowledge about really much of anything.

And yesterday, in a true stunner, the leftist Gustavo Petro pulled off the win. That marks the first time in history that that nation will have a left-wing president. It is a full-on rejection of decades of Colombian politics and sets up some pretty interesting clashes with the good old U.S. of A. over drug policy and trade, among other things. Now, with Lula holding a commanding lead in polls in Brazil, the left has really been cleaning up lately in Latin America. Okay, let's move over to France. Center-right neoliberal Emmanuel Macron was just blocked from a majority in parliamentary elections, the first time that the president has failed to

secure an outright majority in that country in the lower house in 20 years. Blocking his path was a left-wing coalition, including Socialist, Green, and Communist parties. This alliance brought the French left back from the dead to secure the second largest number of seats of any group. But the real surprise came from Marine Le Pen's far-right party National Front. They went from a measly eight seats in 2017 to a record-breaking roughly 90 seats this year, outperforming polls and shocking observers. This is by far their best performance. So a left and right surge swamped the center-right, making life much more difficult for Macron and for his completely terrible plans to lift the retirement age. But the populist revolt, it really is a global phenomenon. As I covered previously in Australia, you might recall, voters tossed down a conservative government in favor of

the Labor Party. But perhaps even more significant, record numbers voted for independent candidates handing the Green Party their best showing in that country in history. Now here in the U.S., our deep discontent will surely translate into a major rejection of the governing Democratic neoliberals this fall. But since our two-party system leaves us with a weak choice between two fundamentally inadequate parties devoted to the economic model of the past, the shift in power is really unlikely to lead to real voter satisfaction. What comes next? Anyone's guess. There is no chance the fomenting global tumult is going to leave us unscathed. Sagar, number of countries, very interesting results.

I mean, you have the... And if you want to hear my reaction to Crystal's monologue, become a premium subscriber today at BreakingPoints.com. All right, Sagar, what are you looking at? Well, as you all know, when I'm confused, I turn to history to try and remind us of what our times might look like. It's never really a perfect replica, but can teach us always a lot. Only months after Biden was elected, there were Republicans calling him the next Jimmy Carter. And I actually even pushed back on that at the time. Inflation wasn't nearly at the highs that we see today. Gas was expensive,

yes, but it wasn't astronomically expensive. Russia had not yet invaded a smaller nation in pursuit of its empire goals. And Biden, while incompetent from the beginning, had not as much time to prove it to all of us. But I am genuinely sad to say today, especially after reading Jonathan Alter's biography of Jimmy Carter, which came out last year, that Biden really is Jimmy Carter, except honestly, worse in many respects. Let's review just the circumstances. First and foremost is a fascinating history of Biden I did not know. In 1976, a spirited Democratic primary was underway to determine who would challenge Gerald Ford. The country was emerging from the wounds of Watergate. McGovern was a total disaster. Nobody knew which Democrat to turn to. The Washington establishment was pushing various senators and others, but a peanut farming first term governor of Georgia named Jimmy Carter decided to run.

Nobody supported him except for one young senator who said they needed new leadership in the party. That senator was Joseph R. Biden, 33 years old at the time, and became the first sitting politician to endorse Carter by saying that since he wasn't old enough to be president, he would at least then endorse Carter himself. His blinding ambition and arrogance was evident even then. But what strikes me is how much Biden has become the heir to Jimmy Carter. Let's take a look at the conditions and their similarities, starting with the economy. Right now, the U.S. Consumer Sentiment Index is at the lowest point since they began measuring in the 1950s, coming in at 50.2. The last time that conditions were that low, you guessed it, 1979 and the early 1980s, right at the nadir of Jimmy Carter's presidency. Inflation is similar with the highest prices today seen since 1979,

exactly when Jimmy Carter was president. Crude oil experienced a similar supply shock under Jimmy Carter following the Iranian revolution. Iran at the time was the second largest producer of oil in the world. And during the hostage crisis, we instituted an embargo, which caused massive pain at the pump here in the United States. It got so bad, gas lines and rationing happening. Our way of avoiding that today is just lift all controls and actually let the price go as high as possible. The theory being if price gets high, enough people won't drive. What I'm struck though by is how similar both Biden are in terms of how they got elected and who got them there. Nobody really loved Jimmy Carter in 1976. Carter won the Democratic nomination by outlasting everyone else and by adeptly playing up his squeakily clean

image in the wake of Watergate. He cobbled together enough votes to actually win the primary. But his core problem was that the same one that dogs Joe Biden. There was no core Carter constituency. Most people shrugged their shoulders and like, yeah, whatever. He's fine enough, I guess. Better than the other guys. He was a default choice more than an affirmative one. One where Democrats thought he was fine, but didn't really love him at all. Now to the general electorate, he was the same. Carter was a choice to rebuke Gerald Ford and the failures of the Nixon administration post Watergate far more than it was a choice of Jimmy Carter. He was the anti-choice just as Biden was the anti-choice to Trump. Now the

problem politically for the two of them is that when you're the anti-choice and then you actually have to run things, then you're responsible and people actually get to get a good look at you. Carter ultimately fell to nearly a 20 percent approval rating as president. That's the all time low. Right now, Biden is impressively running above or below where Carter was at the time of his presidency. But of course, he still has some time to catch up to him. The problem that dogged Carter and dogs Biden is the same. Nobody really liked him that much. Beyond the circumstances of even the political conditions, what really unites the two men is their inability to meet the moment and

inspire creative thinking. Consider this. I read through the entire Jimmy Carter crisis of confidence speech, where he laid out his plan in 1979 to lower gas prices and to ease the pain of the American people. Here's what he came up with. Number one, the same reason that we had the problem in 1979 was that Americans had lost their way and they were consuming too much stuff. That's what he led with. He then announced a plan, and I'm not kidding you, to raise the price of oil so that people would use less of it. And at the same time, Carter raised prices at the pump. He extolled the virtues of, quote, alternative sources of energy, like, quote, gasohol and solar power. To bolster his ambitious plan, Carter proposed a windfall tax on oil companies. Now, your ears must be ringing because all three of those things are

what the Biden administration is trying to do today. It was rejected in 1979 and it should be rejected today because it's not actually a feasible plan for reasons that we've gone over here ad nauseum. And the reason I think Biden is worse than Carter is, look, to be fair, Carter was at least facing novel problems that had not been seen in his lifetime. That is not an excuse that Biden has, and he should have still have met the moment, certainly. But Biden is so old, he was actually a sitting U.S. Senator and involved at the time of the 79 crisis.

He probably watched that speech, and he has not updated policy since then. That's a failure that makes him worse. It's just one of the many tiny examples to show Biden's timidity to actually confront problems, to think differently. The thing about Carter is that just like with Biden, many events were out of his control. Joe Biden is not solely responsible for inflation. He is not solely responsible for gas prices. And he didn't force Putin to invade Russia, just like Carter didn't force the Ayatollah to take over Iran or force OPEC to boycott the U.S. or force Russia to invade Afghanistan.

What made Rush Carter a failure was his inability to react in kind to these crises by giving the American people a plan and confidence, anything that he might actually do something about it or at very least, try to do something for people's lives. After 18 months, we can confidently say we are worse off than the day that Joe Biden took office. And just like in 1979, waiting in the wings is a candidate that said, make America great again, who ended up winning one of the biggest landslides in American history. The inevitability of that outcome just seems more and more likely every day that passes. Isn't it just crazy how much history repeats itself? And if you want to hear my reaction to Sager's monologue, become a premium subscriber today at breakingpoints.com.

Joining us now, again, friend of the show, Peter Zayhan, he's the author of the book. Let's throw this up there on the screen. The end of the world is just beginning. You can go out and buy it right now on the shelves. Peter, I've come to really appreciate your analysis. And one of the things that we wanted to expand on with you is something that you and I had talked about previously, which is globalization and inflation, about how part of the reason why we've had low inflation over the last 30 years is actually a result of global conditions, which are coming to an end, which you write about

in your book. And I'd love for you to be able to expand on that for our Breaking Points audience. Yeah, of course. So in the world before globalization, so World War II and before, there was little trading, or what existed was basically an imperial government raiding the rest of the world for markets or for resources. So we had hundreds, really thousands of different separate local economic systems, and you could only source materials from within your own geography. And so if you didn't have oil, you didn't industrialize. If you didn't have food, your population was really low. But globalization made the world safe for everyone. And so any sort of international economic exchange, regardless of what it was, could happen.

And the U.S. Navy ensured that it could happen on the high seas without a military escort. That was kind of the whole basis of it. And so all of these little disparate parts started amalgamating eventually into one total global whole by the time we got to the 1990s. And when you are in a bigger pool like that, everyone specializes and everybody adds value. So you get diversification of production, you get greater bulk of production, you get a lower cost of production. And it works in every economic sector, whether it is energy or agriculture or finance. It is that diversification and that volume that is the world we understand. That's the world we've been in since 1990. And it's the most atypical period in human history. What's going on now, part with the Ukraine war, part with

nationalism, part with terrorists, whether it's from Biden or from Trump, it all takes us into the same place. It breaks up that global whole. And as you do that, we lose all those synergies and all those economies of scale. And we feel that as shortages and inflation. So what we're going through right now, even if nothing else plays in, this is kind of our new norm for the next several years until we adapt to whatever. So globalization isn't like, you know, a switch that you flip on or off, or at least that's not my understanding of it. So how far will we go back to that prior to World War II era when you really have much more limited trade? Is this like a 20% dial back? Is it a 50% dial back? Is it an all the way back? How do you sort of see that landscape?

It really depends where you are and how you feel it's going to depend upon what your local geography of trades ends up being. So on the positive side, look at North America. So the United States has the best demographic structure in the world, the most stable capital structure in the world. It's the home of the global currency. Mexico is the best demography in the advanced developing world. We've got a first-rate manufacturing system. We're the world's largest producer of food and of energy products. So even if North America is 100% on its own, we're probably only looking at about a 10% to a 15% drawback. That's our entire import and export portfolio outside of North America. That's awkward to adjust to,

particularly in manufacturing, but it's totally doable. Then look at China. 85% of the energy comes from somewhere else. 90% of the inputs that go into their agriculture sector come from somewhere else. About half of the raw material inputs that go into their manufactured goods come from somewhere else. The medium and high quality components in that all come from somewhere else. And their export markets is how they employ their population. So if you deglobalize the Chinese economy, you're talking about a reversion to pre-industrial standards of living. And that can happen surprisingly quickly because all of the inputs that are responsible for manufacturing are similar to the ones that are responsible for keeping people alive. So if something happens to

agricultural or energy markets, that is the end of the People's Republic of China as a significant power. Yeah. And that's, I think, one of the most provocative and I think interesting points you've been making in your book tour here. And actually, I saw a piece I wanted to ask you about. It just broke this morning, how Russia has now become the largest supplier of oil to China, given the discount markets that were happening there. What do you make of that global realignment, given the fact that they do import so much of their energy? This will backstop the Russian economy, of course. Of what import should we make of the Russians being able to fill in and become the largest supplier of oil, even more so than Saudi Arabia to China? Well, there's a short-term issue and a longer-term issue. The short-term issue is that in absolute terms, China hasn't

risen up that much. Russia was already number two, and the difference between number two and number one were small, and they regularly went back and forth. So there's a bit of a statistical play there. A little bit longer term, the crude that comes from Russia to China is not the normal stuff that you see on international markets. It's all from eastern Siberia, and the Russians don't know how to operate any of those fields. They're just beyond them technologically. So all of the production that ends up in China is actually dependent upon Shell and Halliburton and the rest, and they have now all left Russia. So we're going to get an interesting real-world experience on how fast the most technically advanced fields in the world can fall offline because of lack of technical skill. Will that be this year? Will that be next year?

I don't know. But this is the end of China's ability to get Russian oil, not the beginning. Fascinating. So our basic plan in the U.S. to deal with rising inflation is to hope the Fed jacks up rates and gets this thing under control. Given that there are a lot of- That is the traditional method. I'm not saying it there are a lot of- That is the traditional method.

I'm not saying it's not painless, but it is the traditional method. Yes, but given that inflation is being driven by a lot of things that aren't just the amount of demand within our economy, how successful do you think that that approach will be this time around? It totally can be successful.

Whether it can be successful without recession, I think is kind of an obvious question. Considering that we're dealing with demand and especially supply shocks here is the problem. If it was just a demand shock, if this was just us returning from COVID and starting to travel again and going back to our more normal consumption pattern, if it was just that, then interest rates probably are the tool. But there's simultaneously a supply shock. So the three big things that are going on in the world, the Ukraine war is shocking international energy and agricultural markets. Number two, China's falling out of the system. COVID is the proximate cause, but it's only one of many. So manufacturing has to reshore or at least shore somewhere else. That means we have to build up the entire supply chain somewhere else. That was going to be inflationary all by itself. So that's kind of a combined supply and demand shock. And then third, and by far most importantly, the baby boomers, the largest

generation we've ever had, is leaving the workforce. And the replacements on the young side are the Zoomers, and they are the smallest generation we have ever had. So we have a 400,000 worker shortage this year, and it will increase every year for the next 12 until peaking in 2034 at about 900,000. So we have a problem with our supply of labor. That is by far the number one cause of inflation this year and probably next year as well. And interest rates are useless for dealing with that. Right. I think it's such an excellent point. And one of the last things I want to get with you, Peter, is we talked previously about how companies need to get more used to having inventory. And so we can move away from just-in-time delivery. The four-letter word.

Yeah, one of the worst words for many companies' balance sheets. How do you incentivize that and change that? Because from what I'm seeing, given interest rates and all of that right now, it's actually more likely that they're going to try slash and burn cost and they won't even have the incentive in order to invest. So we may actually be inducing some other problems on that side. Or do you see it differently? I'm curious. Well, a couple things to keep in mind is demand is shockingly stable in the United States right now. We're bouncing back from COVID. Americans have more than $2.5 trillion in the bank. This is the most cash flush the American consumer has been since the dot-com bubble. So demand, even in an era of high inflation, is going to continue.

Ignore customer confidence surveys. Look at retail sales. Look at what we actually do, not what we're bitching about. And that would suggest that the demand is still there. And as long as demand is still there, the cost cutting is going to be held in check because there is someone to sell to. There is someone to sell to at the prices that people have to pay now. The role for government here is very small. There may be some specific critical materials, as we've just discovered baby food might be on that list, where having a regulation for additional inventory stocks might make some degree of sense. Although with government regulation, by the time we get around to that being in place in an intelligent way, we'll probably be on to the next crisis by then. But I think this is entirely a private sector

issue. Companies are going to discover, companies have discovered that if you have to wait on a part nine months, is it really a viable part of your supply chain? And you have to find another supplier. And especially what we're seeing in the IT space is that China has now been offline for so long. Shanghai was down for two months. It's about to go down again. We're seeing manufacturers being forced to relocate to places like Mexico, the United States, and Vietnam, kind of the three big winners out of this. But it still takes time. And so companies are now making orders in mass for product that is not yet coming out of this. But it still takes time. And so companies are now making orders in mass for product that is not yet coming out of supply lines because the supply lines aren't yet in place.

But it is providing some of the capital flow that is necessary to build up this new system. On the back end, it'll be a more stable system with shorter steps that is more economically viable, that employs North American workers, that is closer to home, that is cheaper to operate. These are all good things. We don't get there in a year. Yep. Well, you always leave us with something to think about, Peter. So everybody go out, buy the book. We're going to have a link down in the description. We love talking to you. Hope that you'll come back and we appreciate you joining us. Not a problem. Until next time.

Absolutely. Thank you guys so much for watching. We really appreciate it. I promise that announcement, it's coming. It's coming, people. It's coming on the live tour. The tickets are coming as soon as we could shake out all the issues. I don't know why these things take much longer than anybody actually tells you, but hey, listen, that's how it goes sometimes. So it is coming. Thank you all so much for your support. We obviously deeply appreciate it in these crazy and these troubled times. And Crystal, you going on Bill Maher, I think it's just an affirmation of what we do here every day, you know, and why we do the show the way that we do it. Yeah, it felt like that.

I felt very grateful. Felt very grateful for this show. I'll just say that. I felt very grateful for the space we have here and the format we have here and the ability to sort of like really dig into these issues from a variety of perspectives like being able to dig in with Peter Zaihan I mean that's, it's a great thing that we're extremely grateful to be able to do so thank you guys for that.

Certainly. We'll see you all tomorrow. this is an iHeart podcast