Breaking Points with Krystal and Saagar - 6/23/23: Bohemian Grove Sued, Killer Whales Attack Yachts, Zuckerberg's Twitter Competitor, Pentagon Social Media Patrols, LIV Golf Merger Falling Apart

Episode Date: June 23, 2023

This week we discuss Bohemian Grove sued over Worker abuse, Journalists backing Yachts over Killer Whales during recent ocean attacks, Zuckerberg planning his own version of Twitter called "Threads" to be released soon, Ken Klippenstein covers The Pentagon patrolling social media for mean tweets about US Generals, and Matt Stoller covers the LIV Golf merger falling apart.To become a Breaking Points Premium Member and watch/listen to the show uncut and 1 hour early visit: https://breakingpoints.supercast.com/Merch Store: https://shop.breakingpoints.com/ Learn more about your ad choices. Visit megaphone.fm/adchoicesSee omnystudio.com/listener for privacy information.

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Let me hear it. Listen to voiceover on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts. A lot of times, big economic forces show up in our lives in small ways. Four days a week, I would buy two cups of banana pudding, but the price has gone up, so now I only buy one. Small but important ways. From tech billionaires to the bond market to, yeah, banana pudding. If it's happening in business, our new podcast is on it. I'm Max Chastain.

And I'm Stacey Vanek-Smith. So listen to Everybody's Business on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts. Hey, guys. Ready or Not 2024 is here, and we here at Breaking Points are already thinking of ways we can up our game for this critical election. We rely on our premium subs to expand coverage, upgrade the studio, add staff, give you guys the best independent coverage that is possible. If you like what we're all about, it just means the absolute world to have your support. But enough with that. Let's get to the There's always been a lot of questions about Bohemian Grove ever since Richard Nixon was caught on tape talking about it, since Alex Jones infiltrated it and gave us some shocking footage from inside. But this one is actually a much more pedestrian problem. Let's go ahead and put this up there on the screen. The actual workers at Bohemian Grove are suing the elite club for wage theft. What they say is that Bohemian Grove, despite being a billionaire playground, is accused of failing to pay overtime and not giving them enough breaks.

In fact, one worker described members as obscenely wealthy with private jets, multimillion-dollar cars, $200,000 watches, homes on the beach in Malibu. They said that they would have to perform tasks that were beyond their job duties, including such as one instance where a billionaire member forgot to bring underwear to the camp

and the valets were asked to hand wash it. They explained over the years the conditions, overwork, lack of pay for overtime, lack of breaks, worsening despite promises for workers to do better. They include, quote, kind words from some of the very wealthy members, friendship, and co-workers. That's so nice. Coming back year after year for their job. It's still going on, and they say that even if you work 23 and a half hours a day, your daily rate is still your daily rate. So surprise to no one, the billionaire kind of secretive hub remains a place where their staff apparently doesn't get treated very well. And, you know, if you're going to ask a guy to hand wash your underwear, you may want to pay him well is when you're worth that much so that he doesn't talk about it in the press.

I mean, that's the thing. It's like these people could afford to treat these workers like very well. And then you wouldn't have this lawsuit and all these embarrassing claims out in the press. And to get more specific, they say that the Bohemian Grove treasurer, Bill Dawson, has personally directed workers to falsify payroll records and to work off the clock. The valets here say they were only paid for eight hours despite working 16 plus hours a day. 16 plus hours a day without breaks for the duration of the 14-day summer camp. Another allegation claims a worker was directed to hide from a payroll employee when they made a surprise visit to the camp as they were being paid under the table. We just want this to stop, said a former valet at the camps who requested to remain

anonymous for fear of retaliation from the clubs or members. I mean, this is like our whole society just in a nutshell right here. Workers being used and abused, these incredibly wealthy, powerful, secretive billionaires thinking that just them being like offering them some kind words is all they really want and need, not like actually getting paid for the hours that they're working

and not being treated like indentured servants. It's unbelievable. I mean, it's too perfect, honestly. It is a bit too perfect. So, there you go. The latest from Bohemian Grove. We'll keep everybody updated and we'll see you later. So, if you have existed online, you're probably aware of a new phenomena where a number of orcas

has been attacking primarily yachts off the Iberian Peninsula. And apparently, so the story goes, according to scientists, there may have been one orca that originally was traumatized by one of these boats, learned how to ram and disable them, and has taught her orca friends how to do this. They're fighting back. They're fighting back. And that has really captured the imagination of people online who have been talking about

an orca uprising against the yachts. So on cue, of course, the Atlantic has to come in as a buzzkill for everyone involved

and pen this way too self-serious piece. Go ahead and put it up on the screen. Titled, Killer Whales Are Not Our Friends. Stop Rooting for the Orcas, Ramming Boats.

This is by Jacob Stern. I'll read you a little bit at the beginning so you get a sense of it. In recent months, orcas in the waters off the Iberian Peninsula have taken to ramming boats. The animals have already sunk three this year, damaged several more. After one of the latest incidents in which a catamaran lost both of its rudders, the boat's captain suggested the assailants have grown stealthier and more efficient. Looks like they knew exactly what they're doing, he said. Scientists have documented hundreds of orca boat incidents off the Spanish-Portuguese coast since 2020,

but news coverage of these attacks is blowing up right now thanks in part to a creative new theory about why they're happening. Cotation vengeance. Now that's a story. This author then goes on to talk about how you shouldn't, like, idealize or anthropomorphize orcas and that if you want to do that, they're actually really brutal and terrible. No, they're killers. Though recent events may fit the story of these orcas being anti-colonial warriors, lol, you can't just anthropomorphize animals selectively. What about all the other evidence we have of orcas' cruelty or even wickedness? Scientists say they hunt and slaughter sharks by the dozen,

picking out the liver from each one and leaving the rest of the carcasses to rot uneaten. Orcas kill for sport. They push, drag, and spin around live prey, including sea turtles, seabirds, and sea lions. Some go as far as to risk

breaching themselves in order to snag a baby seal, not to consume, but simply to torture it to death. Once you start applying human ethical standards to apex predators, things turn dark fast. Sagar, your views on hashtag orca uprising.

I mean, I still support them. Yeah, they're vicious killers, but so are a lot of things in the animal kingdom. So what? I mean, it's also like, yeah, like you said, why are we taking this so seriously? In general, I mean, look, even if they are the vicious demons of the sea,

we're the ones who are hurting them, so like, why shouldn't they fight that? So what does that make us? Yeah, look, even if they are the vicious demons of the sea, we're the ones who are hurting them. So like, why shouldn't they? So what does that make us? Yeah, exactly. Who are we? We're the vicious demons of the land, I guess, whenever you look at it. So I thought the whole thing is a bit silly. And I also, I don't like though, that he's actually falling into the trap of so-called anthropomorphic by portraying it as somehow putting a value judgment on killing baby seals. It's like, okay, well, actually a huge number, including us not that long ago, of species in the animal kingdom kill their young.

Like it happens quite often, including our closest cousins, the chimpanzees. Bears literally eat many of their young. Sometimes, I believe in some cases where there's like offspring of another alpha male who's killed that all of another alpha male who's killed, all of their offspring will just be killed. It's par for the course in the animal kingdom.

That's the brutality, if you even think it's brutal, of evolution. In many ways, it's actually a very elegant system. So it's one of those where I get annoyed at this value judgment on the orca itself. And I think that any time, and this is a little Ted Kaczynski hat coming on, where you see things in the wild evolve as a system to try and push back against the encroachment of mankind, I can't help but cheer for it just a little. The thing that just to me was so funny

is like everyone's joking about, like everyone's having a good time on the internet with this, right? Making memes, doing their thing, pretending that the orcas are anti-colonial warriors, like they said. And then you have to come in and do this, like, very self-serious analysis of, well, actually, they kill baby seals and blah, blah, blah. It's like, come on. Like, no one was actually thinking that the orcas were, like, the vanguard of the revolution here, guys.

Everyone's just having fun on the internet. I liked some of the responses to this piece. One of them said, they're not called best friend whales after all. Another one said, did a yacht write this? Which I thought was pretty good. And then also in regard to like the Rogan RFK thing, there were a bunch of like $100,000 to debate the orca thing. So anyway, that's the state of the discourse. I'm with the orcas. I still think orcas are cool. I think what they do is brutal, but I think a lot of things

that are in the animal kingdom are brutal. In fact, that's what I think is cool. Some interesting developments in the social media world. It looks like Mark Zuckerberg will be launching a new Twitter competitor. Let's go ahead and put this up there on the screen. They are calling it Threads. It was codenamed inside of the company called Project 92,

and screenshots suggest it will feature a continuous scroll of text like Twitter with buttons similar to like and to retweet. Ryan, you've been looking into this a little bit for us. What do you know? What's going on here? So basically what's coming out of Facebook is they think that Facebook is, I mean, sorry, they think that Twitter is quite vulnerable. Advertising revenue collapsing and you've got a lot of liberals kind of, liberals freaking out about it, leaving. And you've got, they're thinking is that athletes and celebrities, which once made Twitter, you know, the kind of place that it was for everybody to be, are themselves.

Because if the journalists are going somewhere else, then the athletes and the celebrities who are there, because the journalists are there, are going to go somewhere else as well. And so what they're doing is they're linking it up with Instagram but making it a separate account. So the way it would work is that if you're on Instagram, you can port your username over and you can alert all of your followers that you're over there. And your block lists, your safety features that people appreciate over at Instagram, those will all carry over to the other thing. And so they're really gearing this toward, I think, the kind of people who are interested in a Mastodon or a Blue Sky.

And in fact, they're saying it will be interoperable with Mastodon. See, that's where I'm confused. How would it be interoperable? Because Mastodon is a decentralized platform, so I'm assuming they're building it on top of that architecture. So this would also be decentralized as well.

And so they're reaching directly out to a bunch of celebrities and athletes trying to convince them to come over, which is the opposite of Elon Musk's approach, which is to reach out directly to celebrities and athletes and insult them and try to drive them. Well, see, that's the fascinating part here, which is in terms of how you can actually get this going, you would need an actual network of people. Because we talk about this all the time. We had Jack Dorsey on the show very recently. We asked him about it. And the whole point of Twitter is that everybody's on Twitter. It's the network effect of all of that. So when you start an alternative, going after elite users is smart because Twitter's really only used by some 10% of its user base. It's more like everybody follows those people.

And to the extent they engage with it, they're engaging with replies and retweets of those individual, very small select group. The problem though is you still need the masses of people to make it an effective communication tool. That said, it's not a smart – it's not a dumb play. Because you look at this company, it's in turmoil. You know, people – whether people are engaged or using it, nobody knows based on the data.

If there was ever a time where you might be able to replace it, it could be now. Facebook has good relationship with advertisers. They obviously – they've got the cash and the money to burn as much as possible to try and prop it up for as long as needed. So maybe it'll work. I don't know. And if it does work, what it would probably wind up being is a liberal Twitter. Right. And which would fit into the way that we're kind of splintering in our social media world.

That it's basically impossible kind of to build these Mono platforms anymore where everybody is on board because you already see and over on blue sky as you see Conservative people start to join right you then you then see a reaction like of people say well I'm quitting if this person's over over here like the idea that you're everybody can be on the same platform Seems very seems quaint at this point. And so I could imagine it being, it would run from the left to the never Trumpers. Yes, that's very possible. No, no, no, I mean, I think the use case is there for a small number of political users.

The question is, is it there for everybody else? Let me give you an example. One of the ways that I relax is I like to listen to business podcasts, like stuff that has nothing to do with politics. It's been interesting for me and for Crystal. We never intended to become small business people, but suddenly we're running a business.

It's fun for me to listen and to engage. For example, I'm giving this example. It's business Twitter. I'm looking at all these entrepreneurship. Some of these people are really annoying, and they're faking their business. But you learn some cool stuff there. Anytime I get into watches, for example. I like the watch.

This is actually an Omega swatch, the moon swatch. And start looking. Be engaged with it a little bit. You'll find these fascinating threads. That's where I don't know if the user base of current Twitter. I think they're fine. Watch Twitter. They don't care about censorship. You think Watch Twitter, I think they're fine. You know, watch Twitter. They don't care about censorship or whatever.

You think watch Twitter is gone? Huh? You think watch Twitter is – I think watch Twitter is going to stay. There's nothing wrong with current Twitter. There's nothing wrong with, you know, the menswear guy. I love that guy, by the way, Derek guy on Twitter. He's a huge lib, but you got to give it to him.

The man knows how to dress. He's got great taste. His threads, you know, and stuff are very useful. I don't see – No pun intended. Like there's nothing wrong for his – with Twitter for him right now, right? He's got great taste. His threads, you know, and stuff are very useful. I don't see. No pun intended. Like there's nothing wrong for his, with Twitter for him right now, right? Like it's actually working well.

There are multiple different Twitter subcultures that I live in and engage with of which censorship is just not an issue. Like from what I've been told, NBA Twitter is lit. It's so much fun. If you ever watch TV, if you're engaged in like shows, I like to watch trashy reality TV sometime. My fiance tells me that Love Island Twitter is the best Twitter. So for them, they're not having issues that you and I could talk about here with all of them. That's the real success. You have to be able to get normie stuff that has nothing to do with politics over.

I just question whether that will port over to an actual competitor. It's a real question. And it raises the question of what was it that originally brought everybody over to Twitter. And in my kind of oral history of it, I would say that it was in 2008, 9, 10, journalists, whether it was sports journalists, political journalists, are there watch journalists? Yeah, there are actually watch journalists. Shout out to Hodinkee and all those guys. Because the watch journalists were there,

then the big watchmakers are going to be there. And then people are going to like watching the kind of engagement back and forth between the watchmakers and the watch journalists. And same with sports, same with politics. You don't have the same kind of world of journalism that you had in 2010. That's true. And so even if you did get everybody from CNN and MSNBC and the New York Times to join this new Twitter, if they end up calling it Threads or whatever,

that doesn't necessarily mean the same to the public because what the old Twitter did is because all the journalists were there, then the politicians were there, and then the politicians realized that they had to be authentic if they wanted to get any engagement. And then people were like, oh, wow, we're actually engaging.

I can yell at a politician and they care about this. And they actually will do something about it too. But if the politicians don't believe that the journalists have the same power that they used to, then they're not gonna engage in the same way. So I don't know. It depends on what kind of world we live in, whether or not this can be recreated.

Maybe it can. Maybe this is a river that has just, and the water has flown by. Maybe you're right. Yeah, I'm not so sure a competitor will work, but I'm interested. I always like looking at new stuff. You know I'm not so sure a competitor will work, but I'm interested. I always like looking at new stuff. You know, something that I think a lot of people, including me, who thought that social media was dead and was over was the rise of TikTok. TikTok completely

cannibalized Instagram. It nuked a lot of short form video competitors. And it's the unequivocal winner in the social media war within just a couple of years in the United States. So, you know, put the Chinese complaints about it aside, of which I very much agree with, but as a matter of tech, it worked. I mean, it disrupted the industry completely. So that is, you know, we shouldn't count these things out before they happen. I'm a little bit skeptical, but again, like I said, you never know. Hey, folks, it's Ken Klippensen with Breaking Points, The Intercept Edition. I want to talk to you today about my new story titled, You never know. even embarrassment. That's right, your tax dollars will pay for this via the Pentagon's equivalent to the Secret Service, and that's called the U.S. Army Protective Services Battalion. The battalion is tasked with safeguarding top military brass from the chairman of the Joint Chiefs to the Secretary of Defense. The unit protects these current as well as former and retired high-ranking

military officers from assassination, kidnapping, injury, or embarrassment. And that's a direct quote from Army records that I'd like to show you guys on Element 2 on the screen now. So this reporting is based on a number of obscure government documents I obtained, which I'm going to show you during this episode so you don't have to take my word for any of this. And I don't blame you if you don't, because a lot of it is pretty outrageous. To give you some background, the battalion has existed under a number of different names going back to 1971. But more recently, it expanded its mandate to include, let's get element three on the screen now, monitoring social media for, quote, direct, indirect, and veiled threats, as well as identifying, quote, negative sentiment regarding the people that it protects, according to a procurement document dated 2022.

So the country's national security apparatus has become pretty obsessed with disinformation and social media, particularly after the 2016 election, as I've reported on this show before. And as a consequence of that, agencies and offices have sprouted like daisies and just proliferated all across the federal government to try to respond to this purported threat. Protective details of the past generated a pretty fair amount of controversy, particularly under the Trump administration. You might recall his education secretary, Bessie DeVos, had an around-the-clock security detail that racked up over $24 million in costs, led to a huge scandal, a whole new cycle. Same was the case with Scott Pruitt, who ran up over $3.5 million and led to an inspector general report that said, what was

the reason for any of this? They weren't very persuaded by the threats that he alleged. But now that it's the Biden administration, you don't hear much about this stuff anymore. But so the procurement document that I described before, which I obtained an unredacted copy of, describes the Army's need to, quote, mitigate online threats as well as identify positive or negative sentiment about top defense officials. Let's get element four up on the screen now. To quote from it, it says that the battalion has a requirement to provide services to the Department of Defense officials

in order to mitigate online threats, direct, indirect, or veiled, as well as identify positive or negative sentiment about these senior high-risk personnel. Let's get element five on the screen now. So here the document goes on to describe the software it would use to do that. And that is a reliable threat mitigation, social media threat mitigation service, a web-based toolkit with advanced capabilities to collect publicly available information, and also to provide the military with anonymity when it goes about doing that. I mean, that's a really interesting point. Why do they need the anonymity? They don't say. So long story short, your tax are paying for the Pentagon to monitor social media and things like negative sentiment and

indirect or failed threats. What any of that means is your guess is as good as mine, because they don't define any of it. And when I went to go ask them for comment, as I always do, they didn't have an answer for me. But what we do know is that they're putting money towards trying to meet these threats and protect these generals from whatever or however it is that they define veiled and indirect threats and negative sentiment. So make of that what you will. Once again, I'm Ken Klippenstein with Breaking Points, the Intercept Edition. Thanks so much for joining me, guys. which was announced about two weeks ago. It actually already feels like quite a while and the narrative on the deal since it was first announced has completely changed. So I'm gonna go into that as well.

Okay, so let me give you the TLDR. The deal is already falling apart. Now, first let's start at the beginning. Here's CNBC's David Faber going on the details of what happened the day of the announcement. The PGA Tour and its Saudi-backed competitor, Live Golf, along with Europe's DP World Tour, have agreed to merge in expectation of creating

a global entity for the game of golf. The agreement, which is not yet a definitive agreement, ends the hostility between Live and the PGA, along with the litigation between the parties. And it calls for the giant Saudi sovereign wealth fund, PIF, which created Live, to invest significant, I'm told, what will be billions of dollars into the new entity. That's over time. Okay. So it was a big deal. It was a huge deal when it was announced. Globe changing, you know, the Saudis geopolitical, like changing the world of

golf, like Donald Trump was involved. It's sort of a massive, massive thing. But here is the gist of the term. So this was according to The Athletic, as best as they could tell. Okay, so the tour is receiving upwards of $2 to $3 billion, plus all the litigation between the two parties, and there's a lot of it, and it's very bitter, is going away. Now, the background to this deal, as far as we can tell, and there here's important context, is that the PGA Tour

has been the ruler of pro-golf for many decades. In 1994, for example, the Federal Trade Commission actually investigated the PGA Tour for monopolization. But Congress back then was, as one would expect, a fan of old rich golfers. And Congress actually threatened to cut the budget of the antitrust enforcers by 20% if they went ahead with a case. So the FTC said, okay, we'll drop the complaint. The vote was 4-0. And until 2021, that's pretty much how things in the world of pro golf remained. Then the Saudi government, through its public investment funder, PIF, decided to finance a competitor to the PGA Tour. It's called Live Golf. Now, Live Golf started luring top players and putting on rival events, and it created competition in the space. It wasn't profitable.

It was a sort of a geopolitical push, but it did create real competition for the first time in many decades. Now, part of this is that the two entities have been in a bitter antitrust suit over the nature of this competition, and it's been going on for about a year. There are allegations of anti-competitive behavior on the part of the PGA Tour, and the PGA Tour itself is under investigation by the government yet again. Now the story gets weirder. As I noted, Donald Trump is involved with his properties hosting live golf events put on by his Saudi allies. He really wants in on professional golf money and PGA Tour prestige. Now, if you read the antitrust complaint filed against the PGA Tour last year,

it seems pretty clear that the PGA Tour has been a problematic ruler of pro golf going back decades, but especially now when they actually face a rival. So, quote, members of the tour receive a substantially lower percentage of the tour's revenues than professional athletes in other major sports, end quote. That's what the players argued. When Liv began challenging the PGA tour, it, quote, threatened lifetime bans on players who play in even a single Liv golf event and threatened sponsors, vendors, and agents to coerce players to abandon opportunities to play in live golf events, end quote. Now, this bitterness, but also the general competition is consistent with pretty much all sports leagues. Rivalry in sports leagues tends to push up compensation for players and consolidation tends to do the opposite.

It's what you'd expect with a monopoly. When you are selling sports services as an athlete to one entity, you're a price taker. When you have a choice of two, they have to bid for your services. Okay, so to ward off the new competition, the strategy of the PGA Tour, they want to maintain their monopoly, was to denigrate Live Golf as funded by murderous thugs. And because of the Saudi government's bad track record here on human rights, I mean, they're murderous thugs, a lot of players refused to play in the new league. So this merger shocked everyone who believed the PGA Tour's human rights rhetoric. Those who believed it, of course. Now, on a broader level, the public discussions were

initially quite frantic about the rise of Saudi influence. Here's a headline in the New York Times the day of the deal. Oh my God, the Saudis are so influential now, like they weren't influential before. I saw Tom Friedman and Andrew Ross Sorkin on CNBC the morning of the announcement wondering whether the Saudis could do the same thing to the NBA or other sports leagues as part of this giant geopolitical play to control athletics, as if athletics is not already dominated by huge sums of money and corporate power. But let's ask a different question. Is this deal legal?

Is it actually going to happen? After all, we have antitrust laws that prohibit illegal mergers. There is a lot of gray area in antitrust law. You know, some mergers, it's like it's not totally clear that it's going to reduce competition. So it's not clear that the Clayton Act applies. That's what a lot of cases are about. But here's the thing. When two companies, the only two companies Want to merge to a monopoly and they announce it as such That's just a violation of black letter law and did that happen here? Well for that I'll go to the head of the PGA tour Jay Monahan who said that this merger is good for his Organization because it allows them to, quote, take the competitor

off the board, end quote. Okay, when a corporate leader publicly says the point of a merger is to monopolize a market and eliminate a competitor, I mean, that's pretty crazy. And I can only imagine what's in the private correspondence that usually lawyers go through when putting together an antitrust case. Now, it's not just me saying this. All of the antitrust nerds that I'm friends with or that I know were in total disbelief

at the audacity of these deal makers. So scholar Herb Hovenkamp, who's generally monopoly friendly and very well respected in the antitrust bar, said that this merger would be problematic in at least three markets, so live attendance, TV broadcast rights and advertising, and golfer compensation. Now, given that Live Golf and the PGA Tour have been bidding aggressively for the services of golfers, it seems pretty obvious that this deal will monopolize at least one of those markets. And that's how antitrust works. It's about markets, specific markets.

So Herb Hovenkamp puts out three markets, but others can do it differently. Everybody agrees that there's just a monopoly going on here. So now, it is unusual for a corporate leader to announce he's doing a deal to remove a competitor. As Bloomberg reporter Leah Nyland reported, one reason he might be doing that is because, quote, no antitrust lawyers were involved in the PGA Tour Live discussions. That's crazy. Every merger of any size involves at least calling an antitrust lawyer and saying, hey, what do you think? But not this one. And so this choice to just not even talk to an antitrust lawyer when they actually have antitrust lawyers on retainers suing each other. It just doesn't make any sense.

Both the PGA Tour and Live Golf, you know, they've got a big fight, and they didn't ask one of their antitrust lawyers to attend a meeting where they sought to merge to a monopoly. They also have dealmaker lawyers, and it's not, well, they're not specialists in antitrust. Like, they know that, you know, two-to-one merger is illegal. So, like, what is going on here? And then there's the announcement itself, which is pretty vague

Apparently after saying it's a merger the PGA tour is now saying it's not a merger It's an alliance or it's a joint company in which they will put all assets or maybe it's a framework Who knows one very clear point for the PGA tour is that whatever this deal is It is intended to remove a competitor. And legally, that is what matters. So as a result, most antitrust lawyers who have commented on this deal publicly from the far right to the far left have scoffed at the very notion that this deal, as announced,

is legal. So I'm gonna put a couple tweets on the board. Here's the former White House competition chief, Tim Wu. He's a Columbia law professor, focuses on antitrust. He tweeted that the deal won't survive. Libertarian antitrust lawyer, Josh Wright, who's at George Mason, he mocked the combination. And indeed, it is a joke. Indeed, it's so stupid that the PGA Tour and the Saudis have managed to turn Congress somehow against rich white golfers. That is an accomplishment. So Senator Richard Blumenthal,

for instance, has demanded that the antitrust division look into the merger. The antitrust division is looking into the merger, and now the deal is probably going to face a challenge from enforcers. It's almost impossible not to. It's just disrespectful to just merge to monopoly, like doing a cocaine deal, a giant cocaine deal in front of a police station. There's also going to be a congressional hearing. Now, a giant cocaine deal in front of a police station. There's also gonna be a congressional hearing. Now a different lawyer pointed out that it actually gets worse because it's not just the Department of Justice with jurisdiction, but Great Britain and the European enforcers

also have jurisdiction. Cuz it's a global combination, it's a global monopoly. So now you can get around antitrust if they just pass a law saying that antitrust doesn't apply in this particular case. And that has happened. So in 1966, when the AFL and the NFL wanted to merge football leagues, Congress actually had to grant an exemption to antitrust law. A side note, the politician who did that was from Louisiana.

And he said, if I'm going to grant this exemption, you have to start a football team in New Orleans, and that's why we have the New Orleans Saints. So you can thank antitrust for the New Orleans Saints. At any rate, the point here is that unless America, the American government, the European Union, and the British government all grant an antitrust exemption as Congress did for football in 66. The deal seems kind of crazy. So okay, to put it nicely, the legal situation is dicey. And that's starting to have impacts on the discussions of whether the deal will actually go through. So large Wall Street players are now possibly involved on the side of the actual golfers.

So the legal situation is, to be nice, dicey. And that's starting to have impacts on the discussions of whether the deal will actually go through. Large Wall Street players are now possibly involved on the side of the golfers. Let's take a listen to CNBC talking about this. I'm also told that Patrick Cantlay, one of the players who's also a player director, whose sponsor includes Goldman Sachs, is probably getting some good advice from the likes of Goldman Sachs here and has been an important voice here in terms of what are we going to get as players here for stepping up and saying yes to all of this,

given that we were willing to accept a lot less to stay at the PGA, so to speak, than go to live golf. In light of how a lot of the players, like top player Rory McElroy, are responding to player compensation in this deal, it's hard to see how it's going to go smoothly for all sides without a lot more money being put into the actual arrangement. So let's take a listen to what he said. Should the golfers who maybe stayed loyal and turned down live, should they be made whole financially? money being put into the actual arrangement. So let's take a listen to what he said. Should the golfers who maybe stayed loyal and turned down live, should they be made whole financially? I mean, the simple answer is yes. The complex answer is how does that happen? Let's just be real here. There's no actual reason to allow the merger. It doesn't have to happen. Unlike team sports, such as football or

baseball, golf is actually a sport of individuals, and it doesn't actually require leagues. It's more like boxing. You can have boxing matches without having boxing leagues. You can have lots of different types of tournaments. You don't need just one league for golf. In fact, that's what a bunch of the antitrust complaints and investigations have been about from the 90s to today. Now, obviously the PGA Tour and Saudi leaders understand at some level these legal and operational realities. The people who run the PIF are sophisticated. So is the PGA Tour. So what's really going on?

Well, honestly, I don't quite know. One possibility is that the Saudi government, which funded Live Golf through its sovereign wealth fund, is trying to avoid embarrassment. In February, a court ruled that the Saudis had to make their emails public in their antitrust suit with the PGA Tour. They claimed, oh, we're a government. We don't have to do that.

We're not like a regular company. Governments do have what's called sovereign immunity. But a judge said, look, you have sovereign immunity when it's government business, but you guys are running a golf league. That's more like, you're more like a corporation. So yeah, you have to tell us what's going on. You have to give us your emails. And the Saudis don't want that. Neither does the PGA Tour, but they knew it was going to happen, that the Saudis didn't. So one thing that's going on here is that they're

ending all the litigation between Live Golf and the PGA Tour, and the Saudi emails will remain private. It's true that there could be a merger challenge, and so bad emails could come out, even if they try to bring this merger to a completion. But a more likely path is that the antitrust division at the Department of Justice investigates the deal, the Saudis drop their merger attempt before the trial, and Live Golf shuts down. There could be some sort of Saudi investment in the PGA Tour later. Meanwhile, everyone gets the headlines now, which obscures the reality that the Saudis don't want emails made public, and they can blame the antitrust division for the collapse

of Live Golf, even though what's really going on is Live Golf was never profitable in the first place. At any rate, something weird is going on here. And if the deal goes through, which I don't think it will, it's likely because of high-level political decision from the Biden administration, the EU, and the British government to move it through as a favor to the Saudis. I don't think that's going to happen. It's easier to just let LiveGolf die and then have the Saudis make a separate unrelated investment in a few years or really not even do that. There are a lot of other possibilities. Maybe they'll find a way to do some sort of divestment or change the terms to make the

deal palatable, though honestly, I can't see how they do that and make it legal. But when you're dealing with Saudi Arabia, Donald Trump, global sports, you can get to things like money laundering, arms dealing, espionage, weird diplomacy, and all sorts of other conspiratorial stuff. And I don't like speculating on that because it's like seeing ripples on an ocean and trying to guess what's happening beneath. But one thing I can say is that this deal in its current form doesn't make any sense. And that's starting to become clear. Thanks for watching this big breakdown on the Breaking Points channel.

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