Breaking Points with Krystal and Saagar - 6/29/21: Syria Bombs, Unemployment Benefits, BlackRock's Power, Tax Cuts, Mike Gravel, Cancel Culture, Loss of Friendship, Facebook, and More!

Episode Date: June 29, 2021

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Enjoy the show, everybody. Happy Tuesday. We have an amazing show for everybody today. What do we have, Crystal? Indeed we do. We've got some new insights into just how influential one Wall Street firm was in crafting those bailouts early in the pandemic during the Trump administration. We also have some new comments from our friend Josh Gottheimer about salt tax. Surprisingly, getting a little bit of pushback on CNBC. That's how you know that you've really lost the narrative wars when even CNBC is like, this tax cut is only for rich people. I don't know what you're talking about. We're going to honor the loss of a true American hero, Mike Gravel. We've got Matt Stotler in the show to talk about a big blow to some of the antitrust movement.

A judge ruling against the states and the FTC in a case against Facebook, alleging that they are monopolists. But we wanted to start with those strikes in Syria from President Biden. This is really important. And, you know, we can't let these things just go unnoticed. So let's put this up there on the screen. Glenn Greenwald, of course, he wrote a great piece on this. Biden's lawless bombing of Iraq and Syria only serves the weapons industry, which is funding both parties. And I'm glad that Glenn is pointing to the financial incentive here, which is that picture there. Secretary of Defense Lloyd Austin, who himself was a member of the Raytheon board and before that was head of CENTCOM in the United States military. And here's the thing.

General Austin actually did a whole radar on this on Rising. He was the person who started that whole failed train and equip program in Syria where like it was like a billion dollars or something and half the weapons ended up in the hands of Al Qaeda. And at the end of the day, they had like three or four trained soldiers, all things considered. So it's a complete and total joke. He has a very failed record in the region. But it does go to show that this strategy actually began under Lloyd Austin and that the ground was laid from Barack Obama to Donald Trump, who ramped it up, and now to Joe Biden, who I believe this is the second time that he's used these quote unquote authorities. And it is a very tricky question. Here's the thing. In 2014 and 2015 and more, whenever people started doing this in Syria, I remember thinking, this is kind of crazy. You know, Bashar al-Assad is the legally, quote unquote, I guess, internationally recognized president of Syria.

I don't like Assad. I think he's a genocidal murderer. That being said, he's still the president. And under United States law, we have to declare war against another country if you're going to bomb that country. We have now bombed it countless numbers of times. We're not the only ones. The Israelis have bombed it. The Iranians. There's all kinds of people that are playing around in Syria.

But here's the difference. In our country, Congress is supposed to have a say. And the real joke of this all is that it's all authorized under the 2001 AUMF and the response to 9-11, which had to do with Al-Qaeda. But in this case, the bombs that we're dropping are on Iranian-backed Shia militias who themselves are in a sectarian war against ISIS. So you're like, wait, what? And I'm not glorifying the Iranian militias here, okay? Like they have their own agenda. I'm just saying like, if you're going to use the Al-Qaeda, ISIS, AUMF against the people who are actually ideologically opposed to that,

I think that's ridiculous. If you want to bomb Iran in militias and possibly escalate war within that region, Congress should have a say. But they're never going to say because nobody wants the blowback from 2001 or from 2003, which happened when all the senators went on the record for the Iraq war. So they let the president just do whatever the hell they want. And that is incredibly dangerous as a precedent. This is just the latest example. Yeah. I mean, there is not even a fig leaf of cover to pretend that this is lawful. Yeah. This is under U.S. law, clearly unconstitutional. But because Congress is complicit, because they don't actually want to have responsibility for war powers, Nancy Pelosi immediately comes out and says, oh, of course this is justified. No problem. So this is clearly

lawless. Glenn makes the case extraordinarily effectively. The precedent was set in the Obama administration. It was continued in the Trump administration. And now Biden's able to pick right back up. And this is the way that, by the way, executive power works. No president, be they Democrat or Republican, ever says, you know what? The guy before me did too much, went too far, abused these powers, took too much power for himself. I'm going to walk it back. That literally never happens. Whatever expansions of power, whatever lawless behavior happened in the administration before, you can bet that the next one is going to engage in very, very similar things. So there's a few

things going on here. First of all, there's this weirdness of clearly these strikes are on Syrian and Iraqi soil, but they're framed and messaged like we're hitting Iran. So it's almost like they're trying to create this public confusion and loophole that, well, we're not really going after Syria and Iraq. There's a messaging attempt to be like, you guys hate Iran. so it's cool that we hit these Iranian-backed militias. So that's one piece of what's going on here. Another piece of what's going on here is there's this continued justification for more bombing and more bombing and more bombing. Already, reportedly, there's been retaliatory strikes from these Iranian-backed

militias, as the Biden administration puts it. So what's that going to justify? It's going to justify potentially the next time that they feel like appeasing Israel or sending a message to domestic hardliners or just, you know, giving another contract to their buddies at Raytheon or Boeing or whatever. They're going to have all the justification they needed because they struck us, we struck them, now they strike us back. And so the cycle can just endlessly continue without a single stop. And Trita Parsi has been pointing out this should not be, these actions from the U.S. shouldn't be divorced from the continued negotiations over the JCPOA in an attempt to rejoin the Iranian nuclear deal. So this is a way, potentially, of sort of appeasing

Israel, just, oh, we're still tough on Iran, we're still doing the things that you ultimately want us to do, so that we can keep them quiet and we don't have another situation where, you know, the Israeli prime minister comes and gives a big speech to Congress and turns it into this whole partisan spectacle. So basically dropping bombs to benefit the defense industry, to benefit like sort of public domestic messaging, and with not even a fig leaf of cover that this is ultimately constitutional. What Biden claims and what Pelosi backed him up on is that this was in self-defense. Right. Were we threatened by Iran here on our home? So were we threatened? Are we supposed to be in Syria at all? Do we have any justification to be there whatsoever?

No, not at all. So this all of this reasoning is completely bogus. And honestly, no one could even make an honest case for this being constitutional. The Constitution is very clear. War powers rest with Congress. Congress has abdicated those powers. They don't want the responsibility. And so the commander in chief, whether it's Trump or Biden or Obama, can do whatever the hell they want and completely unchecked. Yeah, war is serious business. You can't just send American soldiers to go fight and die for nothing. And we're supposed to all have a say in that. And that's the problem. And it's like, look, with Iran, yeah, I mean, it was technically self-defense, I guess, because they attacked our troops who were in Iraq. Why are we still in Iraq right now? I mean, look, you can throw 2011 at me all you want in terms of leaving and all of that. It's

not even close to the same situation. ISIS has essentially been eradicated. The Iraqi government and military are 10 times stronger than they were back then. There's actually no real reason why the United States has to have thousands of troops in Iraq right now, let alone Afghanistan doing God knows what. And that is actually what is creating a death spiral here. So let's put this next tweet up there on the screen in terms of congressional outrage. Now, not everyone criticized Biden. Democratic Speaker of the House Nancy Pelosi said that the strikes, quote, appear to be a targeted and proportional response. So the Speaker of the House is supporting, abdicating her own responsibility. It's her job in order to make sure that war powers and war responsibilities are held within the purview

of Congress. And she has completely abdicated that. And go and see what Biden had to say. Like, you can just see the casual nature in which we just discuss launching bombs once again on foreign soils country. Let's take a listen. We'll never get a nuclear weapon on my watch as they say and and you know I directed last night's airstrikes targeting sites used by the Iranian backed militia groups responsible for recent attacks on US personnel in Iraq and I have that authority under article two and even those up in the Hill who are reluctant to acknowledge that and acknowledge that's the case. I also want to be clear, as I said, my team and I are working closely with the Israeli government and took office earlier this month. I'm looking forward

to hosting Prime Minister Bennett. I mean, I think you can just see it right there. Of course, he's sitting next to the Israeli Prime Minister, or President, too, while all this is happening. And just to take it back to the legal front. Not an accident, by the way. Not an accident. I mean, that shouldn't be seen as happenstance. I want people to know just how crazy things have moved. And Glenn pointed this out.

Let's put this up there. Which is that in 2011, this is when everything changed. Which is that the House rejected a Libyan authorization measure in order to bomb Libya. And then Obama bombed Libya anyway with NATO. I want everyone to remember NATO, whose job it is to protect us all from a nuclear attack against Russia, or I guess China now, and some sort of self-defense measure, we went in and actively bombed Libya, disintegrated that country into whatever the hell it is right now. I think there's a literal slave markets that are happening there. So thank you, Obama. But you can see that that was a demarcation point.

And the moment that the Dems, I think it was in the Senate at the time, let Obama get away with that. And let's be real, the Republicans didn't care that much. John McCain was down there on the ground in Libya, basically trying to get Obama to bomb it even faster. The moment that that happened, it was over. 2011, we have had now nine, yeah, 10 years of lawlessness in the way that we operate overseas, especially whenever it comes to these AUMFs. All those troops, I remember when those four troops

got killed in Niger and all those Americans were like, wait, we have troops in Niger? Look, what is going on here? It was like, oh, we have hundreds of troops in Niger, Somalia, Libya, I mean, Afghanistan, Iraq, Syria, Yemen. Who has voted in Congress in order to ensure all of this? No one, and that's not even to discuss the U.S. assistance in some of these other proxy conflicts. That's a legitimate policy effort, and more so the president has purview over, and we should debate that. But in terms of the actual U.S. boots on the ground, people should be stunned to see what these people have gotten away with. The Obama people pushed it, the Trump people multiplied it by 10, and the Biden people are just going to

continue using the authorities they have here. Nothing will happen until Congress does something about it. Well, and when we think about authoritarianism, when we think about an executive just taking power and having absolutely no accountability to the people, that's what's happened in the area of war making. And now this is the third president in a row. George W. Bush also took a lot of powers for himself there as well, but he did go to Congress and get an AUMF. So you had them all complicit, which was, you know, not a good state of affairs either. what's happened. The founders really expressly were concerned about war-making powers. This is supposed to be a very serious business and actually foresaw exactly some of the conflicts of interest and how a strongman leader could be in a position of using war-making to bolster his image or using war-making to bolster his partisan allies or using war-making bolster his, you know, his allies around the world that were personally profitable to him. And so those checks were expressly written to the Constitution

for a reason so that the people of the United States would have some say in these activities. That's all gone. I mean, we just need to be really clear eyed about that. And even though it almost feels routine now to see these news items about, you know, more bombs dropped in Syria, more bombs dropped in Iraq. Oh, we've got troops on the ground in places that we didn't even know we had troops on the ground. Oh, you know, we said we're getting out of Afghanistan, but maybe we're not, or maybe we're going to keep contractors there forever, et cetera, et cetera. We can't get complacent in pretending like this is a normal state of affairs or that this is the way that the country is ultimately supposed to operate.

I did want to give a little bit of credit. There were a few lonely voices in Congress who did criticize this decision. You had Ilhan Omar saying that Congress should be consulted. Such strikes are a cycle of violence. You had Senator Chris Murphy also critical of this. You had Representative Barbara Lee saying, hey, maybe the U.S. government should spend more on housing for Americans instead of wars in the Middle East. So you did have a few a few rogue voices out there critical of this decision. But when you got the speaker of the House saying, oh, yeah, this is fine. This is justified. We're cool with this. And very little media consternation, you just know that Biden's going to continue to act this way.

If it's Kamala Harris who comes next, or Trump again, or Ron DeSantis, or whoever ends up being the next president of the United States, they're going to do the same damn thing. They will all do it. And remember this, the people who are in that room who tell them, Mr. President, you need to bomb Syria, that doesn't change. They're all the exact same people. In many cases, they've been in and out of government multiple times, and a lot of them made a lot of money in the interim period. Maybe I'm just a cynical man, and I think that has something to do with it. But on the domestic front, Crystal, I guess this is just as terrible. What the hell is going on? Yeah. Okay. So obviously, you all have probably been following

this debate about there's a lot of jobs that are going unfilled and workers have for the first time maybe a little tiny bit of power in the marketplace. So the instant reaction to this state of affairs rather than being like, hey, how do we make these jobs more appealing so it's worth workers' time to switch jobs, to come into these new jobs so that they can actually earn a living wage and be able to take care of their kids and all of that. Most of the reaction, and this was led by Republicans, but it's had bipartisan support as well, was we got to cut these unemployment benefits. People are getting fat and lazy. We got to force them back into the workplace so that employers can continue to have the powerless labor market that they've become accustomed to. So we're starting to get some results. Some of the states went ahead and cut those unemployment benefits. And so we're now

starting to get some results to see whether this had the intended impact of forcing workers back into the market so that these jobs could ultimately become filled. Stephen Greenhouse over at the New York Times had an analysis of the data so far. And it's early, and it's a little bit anecdotal, but so far, it looks like the people who thought that cutting the unemployment benefits would fix everything and make things great for employers again, they were wrong. We can throw this tear sheet up on the screen. So workforce development officials said they had seen virtually no uptick in applicants in Missouri since the governor of that state announced that they would end the $300 weekly supplement to other benefits. And the online job site Indeed

found that in states that have abandoned the federal benefits, clicks on job postings were below the national average. And you know, it shouldn't be a surprise, Sagar, because we've actually already had a natural experiment with this. Remember at the beginning of the pandemic that unemployment plus up was $600, not $300. That's right. And they cut that back to $300. So if the theory of the case was correct, that all you need to do is cut these benefits and workers will flock back to the marketplace, we would have seen that at least some impact when you cut it from $600 to $300. And that's not what we saw at all.

In fact, most workers returned to work before the benefits were even cut. Most people want to work and provide but have work that's meaningful and actually allows them to care for their family if they have a family, allows them to live in an apartment. And so the focus on just let's make this as punitive as possible to get workers back into the workplace, it's not even effective, let alone moral. So that's what really comes out of this article. One other piece that I wanted to quote, because I thought this was really well put. He says, he writes here, this divide raises a fundamental question of what a healthy labor market actually looks like. Does it mean workers are on such a knife edge that they feel compelled to take the first job that comes along? Or is it one in which employers are the ones who have to scramble

and feel pressure to raise wages and improve working conditions? Are the economy and the public better off when workers get to be choosy or when employers do? Which I thought really sort of crystallized what the core tension and question here is in terms of how you look at a healthy labor market. I think it's very important that we understand this story because welfare politics is extraordinarily potent and it is taking off. I want people to know that a lot of what has been internalized by the American public is that the unemployment benefits are bad. And I

actually think in the future that some sort of welfare politics will be very much within our purview, especially if the economy continues to do very well. So let's put this up there on the screen. Jordan Weissman actually pointed this out. He is actually very in favor of this policy, but he points out New York Times survey. So a New York Times survey says that 52% of Americans want that $300 per week UI benefit to end immediately. Another 30% want to last through September, while 15% want them to go on indefinitely. And even 27% of Democrats think that they should end it now. So a slight majority of Americans think that it should end. And I think the reason why is because the way that this is communicated, it does seem intuitive for a lot of people. But the problem is this. Stop thinking of

people as widgets. People are not widgets who are saying, well, I'm earning $150 more per week by sitting on my couch and doing nothing than I was in what I was doing previously. I've said this a million times at this point. I think this is the true and total revenge of our failed policy of pushing people onto unemployment in the first place and, in a way, giving people a chance to reassess. Is this for me? Should I be doing this? Do I want to drive for Uber? So I take an Uber every day and I ask these guys, they're throwing money at them in order to go and drive. And guess what? A lot of people still don't want to drive. You know why? Because driving for Uber

sucks for a lot of people. And same with driving for Lyft. I don't want to just single out Uber or Lyft. Rideshare in general isn't fun. You know what else isn't fun? A lot of service jobs. What else isn't fun? Some restaurant jobs. People did it in order to make ends meet. But when they took a year and a half in order to reset, they said, yeah, I just don't want to do this anymore. That is a powerful force. And you know what? We could have spared ourselves if we wanted to. We created the natural experiment, separating people from their jobs. So this is the time I'll keep saying again, was a disaster. Do you know how difficult it is once you've spent a year and a half doing something else to say, yeah, I'm going to go back to doing the exact same thing? How many people

actually want to do that? Not many. And this is the final revenge, I think, against Washington policy. In a way, I don't blame people for thinking. But what I would encourage them is to say, think a little bit more like human beings. If you did something else for 16 months, would you not reassess and think, maybe I want to do something different? Maybe I want to move somewhere? You know, I was looking at the data. People are moving in rates that you wouldn't believe. Not just in terms of buying houses. They're moving states. They're thinking about going south, going west, even some going north. New York and California have lost tens of thousands of people. And it's not just rich people that are moving. Many middle class people as well. People are reassessing their

lives. I'm sure we're, subconsciously, maybe that was part of it for us too. I don't know. That's true. I mean, if you think about it, I mean, we're part of a great societal trend. I mean, Joe Rogan, all those people, they moved to Austin. Like this was a great reset button for a lot of people. And that's going to just be a crazy situation. And I have deep and total sympathy with many businesses who cannot find people to work. And most Americans are generally pro-business. They don't want them to suffer, which is why they are saying, let's end these unemployment benefits. I've said it a million times, pay people to go back to work. There's an easy, easy way to do this.

Use those UI benefits, give them to people whenever they go back to work, make it transferable, and let it phase out in like September, October, November, whenever. Let's make this easy on the business and let's pay people a little bit more money. Yes. And there has to be two pieces to the, isn't reset, that's like a conspiratorial term. No, great reset. The great reset. Okay. So we can say reset. Some people are going to be mad at you for saying the great reset. Okay. Or that is a conspiracy, but go ahead. Whatever. The rethink, the great rethink that people are going through. There has to be two pieces. There has to be, on the one hand, the desire and ability of workers to switch it up, you know, that was forced upon them, right?

I think if you had asked people at the beginning of the pandemic, what's the policy that you want? They didn't want the instability of not knowing what job that they were going to go back to. They wanted to stay attached to their job. Now, I actually think that what the ideal policy would have been, rather than forcing people to stay attached to their job, rather than doing the custom balance, for example, of the airline industry that we've covered how much that, you know, how exploited that ultimately was, if you had given people direct aid but made it, you know, a certainty so you know what's coming in, you know you're going to be fine for the duration of the pandemic. And that would have still allowed people to, hey, I'm going to go back to school. Hey, I'm going to rethink whether I want to be in the restaurant

industry working for tips. Hey, I want to rethink whether I want to be on the front lines in Walmart doing this job for low pay with terrible schedule and no flexibility and all of that stuff. To me, that would have ultimately been the ideal situation. But so you have to have two pieces. You have to have on the one hand, this sort of rethink that we're seeing, which is happening at every level of the workforce. It's happening among, you know, affluent white collar professionals. It's happening among blue collar workers. It's happening among service workers. We're seeing these shifts occur. But you also have to have a corresponding shift among the public of thinking, you know what? Low prices and cheap goods are not the only thing that I care about.

Because the reality is in countries where you have people actually earning workers who didn't have to like shit in a bag and piss in a bottle and not ever see their kids make your stuff, it costs some money. It costs a lot. It costs a little more to know that it costs a little more money. And now there's a lot of fear mongering about like this Chipotle story in New York and whatever about the, about all the burrito costs are going through the roof or whatever. When they've done the analysis of, hey, if McDonald's paid their workers a living wage, how much would the cost of the Big Mac go up? And the numbers are pretty small. It's like, oh, you'd have to pay short-term one of I want the Big Mac and the mug and the Walmart goods as cheap as I can possibly get them. So there has to be a shift as well in accepting that, look, a lot of these costs can be absorbed, especially by behemoths like Walmart and Amazon, et cetera. But yeah, some portion of it, a relatively small part,

is going to get passed on to consumers, and things are going to cost a little bit more. So you have to have that rethink as well, or you have to have the government get more directly involved in subsidizing wages. Because I was looking at the numbers also in this Stephen Greenhouse article. He focused in, he did like a profile of a jobs fair outside of St. Louis or in St. Louis where there were jobs that were being offered. They were like $11 an hour, $14 an hour, $12 an hour, et cetera.

And the employers were thinking like, these are pretty good jobs. These are decent wages. But for the workers, they're looking at the fact that if you've got a kid in St. Louis, it would require $30 an hour in order to be able to live and support a child. If you've got two adults working with two children, they'd each have to earn roughly $21 an hour. So even when we're talking about, and St. Louis is not like a crazy expensive place. It's like a mid-level metropolis. We're not talking about New York or D.C. or L.A. or San Francisco. This is like, you know, pretty standard cost of living for a normal city across the country. And $15 an hour is not a living wage, especially if you have kids.

And especially, God forbid, you're a single parent trying to raise a kid. So that's the reality that's facing workers. And for so long, we've just accepted them to like suck it up and suffer and figure it out by some magical means. For the first time, workers are actually in a position to have a tiny, tiny bit of power in the workplace. And there are a lot of people that cannot handle that and see that as a disaster rather than seeing it as a good thing after 40 years of workers getting routinely screwed year after year after year. They see it as a disaster because people are presenting in zero-sum terms and we just shouldn't present it in zero-sum terms. It doesn't have to be that way. The government's presenting

it that way. They're actually the ones who made it semi-zero-sum by screwing a lot of the workers and sending them home in the first place and then not compensating them for it. The study just came out that half the people who applied for unemployment benefits did not get their unemployment benefits. Oh, maybe that's the reason why we need a stimulus check. Looking at you, all the people who said that that shouldn't be part of the policy. So going back and just looking at it is it doesn't have to be zero sum. It really doesn't. Like you can have worker power and you can help businesses too by paying them money. And we can especially make it small business cut off and not have it so that Amazon and Jeff Bezos and all those people are benefits.

This is called policy. The problem is nobody wants to do it. It's easier to just fake, to set fake terms of the debates and then just fight around this. And people get scraps. And unfortunately, I think that's exactly where we are. Hey, so remember how we told you

how awesome premium membership was? Well, here we are again to remind you that becoming a premium member means you don't have to listen to our constant pleas for you to subscribe. So what are you waiting for? Become a premium member today by going to BreakingPoints.com, which you can click on in the show notes. And speaking of fake terms of debates and all of that, BlackRock, our favorite company, the new American real estate company. I'm just joking.

Yeah, America's landlord. I know you guys love it. America's landlord, who the neoliberals say that we should welcome into our neighborhoods, despite the fact that they would definitely raise them to the ground if they could. Let's put this on the screen. This is a perfect example. You want to know how the government works? Top U.S. officials consulted with BlackRock as the markets melted down. The world's largest asset manager was central to the pandemic crisis response.

Emails and calendar records underscore how Larry Fink, who is the head of BlackRock, was in frequent touch with Secretary of the Treasury Steve Mnuchin and Jerome Powell, the chairman of the Federal Reserve, in the days before and after many of the Fed's emergency rescue operations were announced in late March. And the emails, which were obtained by the New York Times through records requests, they show how Mr. Fink was part of this entire rescue package, referring to it as, quote, the project that he and the Fed were, quote, working on together. And I think this underscores how Larry Fink, Steve Mnuchin, Jerome Powell, and Larry Kudlow

were all together on a call the day before the Fed's big announcement. So here's the thing. There's been a lot of criticism of the Federal Reserve. I would say in general that they acted well. And I know that's going to piss a lot of people off, but I. I would say in general that they acted well. And I know that's going to piss a lot of people off, but I believe that their job was to stabilize the American financial system and also make it so that we don't have runaway inflation and all that. And I know we're going to get a lot of criticism for that, but remember, there's a dual part of

the Fed's mandate, which is also on unemployment. And I would say that in general, they acted in the better interest. But I would say that this does show who gets their phone calls answered and gets to shape American policy. It's BlackRock. And if you think that it is just a Steve Mnuchin thing, Larry Fink has two former senior aides who are top people in the White House. So the former National Economic Council director was Larry Kudlow, who is a friend of Larry Fink. And now the current head of the National Economic Council, Brian Deese. Yeah, he was the former chief of staff for Larry Fink. So tell me who runs the government. Go ahead and tell me. And I know that this is going to

seem conspiratorial almost in a way, but here's the deal. These people have intimate knowledge of American financial policy before it's even announced. They are the ones who everything is crafted towards. And I don't think it's a secret why Larry Fink is richer than ever today as a chief executive of BlackRock with, by the way, connections in both administrations than a lot of Americans were in the beginning of March of 2020. BlackRock was one of the companies that profited tremendously during the pandemic. Now, of course, they say, let's put in the lawyerly language, et cetera, et cetera, that there was a complete wall of separation between Mr. Fink and between what they were doing in terms of buying and selling and looking to profit in the market. There was absolutely no communication between them. There was no possibility for corruption. This was all on the up and up, et cetera, et cetera.

According to BlackRock. According to BlackRock. What was really fascinating here is that they actually have the receipts of who it was that Mnuchin was talking to, how many phone calls went out just before that effort was announced. Number one was Jerome Powell, the Fed chair. Makes sense. Number two, Larry Fink of BlackRock. Number two. More than the president. More than the president. Number three was Mike Crapo.

I didn't remember him being that involved. He was the banking chairman. That's why. Okay. You've got Pat Toomey, who has terrible politics as well. You've got Larry Kudlow is next on the list. And it goes on from there. But the person who got the second most number

of phone calls from Steve Mnuchin, who of course is a Wall Street creature himself, was Larry Fink. Yes. What does that tell you about? That's incredible. I mean, this is the proof right here. By phone call. More than the President of the United States. Who runs the government? That's a stunning thing. Who drafted the bailout provisions? Who directed the entire response? This was what was really happening behind the scenes. And so it's no surprise that not only BlackRock, but all of their peers, you know, they did tremendously well. And on the Fed's response here, my biggest issue with the Fed response was that we have all these systems built into place that are like automatic

stabilizers for the market. Oh, yeah. So you don't, you know, the second that there's a problem, they shore it up, the trillions go in, they're good to go, make sure that there's total stability. And these guys, they never have to worry

about the things that you all had to worry about during the pandemic. And there's nothing equivalent like that for the American people. That's the big issue with the whole way that this is all set up. And it's not an accident because the reason it's set up that way is because you got guys like Larry Fink who are pulling the levers behind the scenes. So it's an incredibly important and revealing piece of reporting about how that bailout was ultimately

crafted and who has a presence here. Something that we were talking about from the beginning with the bailout provisions? Because you had the piece that we knew was that Trump was talking to CEOs. He was talking to Wall Street guys. And there was no, you know, hey, let's go talk to union leaders. Hey, let's go talk to actual working people and see what's going on for them. See how their, you know, voices might impact this process and what they would like to see, what would make their lives possible to get through all of this. And, you know, Trump was sort of like, I don't know that I would say he's uniquely tied to Wall Street, but he was certainly unafraid of bringing all kinds of Wall Street people in his administration. Obama was

basically put into office by Wall Street. And Biden has a lot of those same ties. So this is part of the bipartisan infrastructure. It's just as likely that Larry Fink would get a call from the Biden administration as the Trump administration. Oh, absolutely. I want people. And yeah, I mean, given that he has two former aides and one of his other aides is the number two with the Treasury Department, nothing has changed here. And look, there's another story which I think underscores something very clearly. This is around Peter Thiel and how he used a Roth IRA account to turn it into a $5 billion account, which he never has to pay any taxes on. This is one of the most stunning things I've ever seen.

So let's put this up there from ProPublica. They call him Lord of the Roths. How Peter Thiel turned a retirement account for a middle class into a $5 billion tax-free piggy bank. This is honestly crazy. And look, I'll just say, we're covering this story. I mean, Peter Thiel is somebody who I respect and who I actually see the world very similarly to in the way he views the economy and China and all of that. But this is some of the most brazen tax avoidance I've ever seen in my entire life. Essentially what he did is that back whenever he was the CEO of PayPal, he put $2,000 into a retirement account, a Roth IRA, which has an

income cap in terms of when you're able to put it in. It's made it so that it's like post-tax income, you can invest it, and then the proceeds on that, you don't have to pay any taxes on. It's a way in order for middle-class people in general, in order to build retirement accounts while also being able to not have to pay taxes in their later years, in their elderly years. But what he ended up doing with this account is he used the Roth IRA to then go through and buy a non-public PayPal stock, which he was the CEO of, and pennies on the dollar. So PayPal, which eventually sold to eBay for like billions of dollars or whatever, that's how he made a lot of his wealth as well. So the Roth IRA exploded, and then he kept using the Roth money in order to buy non-public stocks in other companies, which he had access to in order to keep buying.

And so this has now ballooned to $5 billion. And that $5 billion, he does not have to legally pay once he hits the retirement age, a single dime in taxes on. Think about that. $5 billion untaxed. This is probably one of the most brazen tax avoidance schemes in modern American history, which is totally legal. That's what I mean. So under the pretext of the law, nothing illegal going on here. But if you want to see how messed up the American financial system is in the way that we tax wealth and financial transactions and more, this is the most prime example that there is. $5 billion completely tax-free. I don't know what to say, Crystal.

I mean, it's totally nuts. Well, and I'm sure you guys know, I mean, the intention of Roth IRAs is to allow middle-class Americans to build a retirement account for themselves. That's why it was passed. That's what these are supposed to be used for. And so he's using this vehicle and just like blatantly abusing it. And as you said, this $5 billion, he won't pay a single penny of taxes on as long as he waits until he's six months shy of his 60th birthday. And then he can do whatever he wants with it and never, never face a single penny of taxes on any of that money. And by the way, I mean,

what's really been, there's been some really fascinating things about, this all comes from the trove of IRS documents. Which has been great. From billionaires that ProPublica has been reporting on. And of course, one of the hilarious, sad, outrageous, ridiculous aspects of all of this reporting has been the response from both the Biden administration, but also mostly from the right that are like, how dare they release these tax returns? Not like, whoa. I mean, they've just taken like the real issue is that how dare we understand

how these billionaires are getting away with, you know, legalized theft from the United States Treasury. They really think that the operant issue here, the thing we should all be really concerned about, is the fact that any of us got to find out any of this information. I doubt Peter Thiel cares. Like, he still doesn't have to pay those taxes. Incredible. Well, and I guess that is one thing you have to say about him.

Like, he's very aggressively, publicly anti-tax. So this is consistent with, I guess, his philosophy. But in addition to these technically very highly dubious and sketchy and aggressive, but maybe technically legal schemes, we also know that a lot of billionaires, they are engaging in illegal tax avoidance. One of the things that we learned this year is that there's a massive gap in IRS enforcement. It's more complicated and more expensive to go after people who are at the top of the food chain because they've got the lawyers and they've got all these complicated schemes employed that makes it much harder to go after them. And we know that there's a massive amount of just tax cheating at the top as well. So in addition to these like legal schemes that are being revealed by ProPublica, there's also clearly, this is again

from the IRS commission, there's a lot of illegal tax cheating going on with these people as well, which is just, again, it's bananas that it's not good enough for you that you get to take this $5 billion and not pay a single penny in tax on it while you all are wage earning and paying in what you owe and doing what you're supposed to do and really supporting the entire country and making it possible so that we can have infrastructure and have the nation that we have as much as it's sort of crumbling underneath us right now. And these people get away with doing none of that. And it's not enough for them to engage in the legal schemes. They've also got to go that extra mile and make sure they pay even less taxes by

just out and out cheating on it. That's what's really outrageous here. And, you know, I'm obviously I'm not super concerned about like deficits and that doesn't drive my politics, et cetera. This is a basic matter of fairness. It's a basic matter of feeling like the country is set up for the many rather than the few, like Peter Thiel. And I think it also reveals as we're heading more into these tax debates about, oh, do we lift the marginal tax rate? Do we lift the capital gains tax rate? What can we do here? You got to really get at some of these schemes. And you really got to go after wealth.

Because ultimately, there are so many tricks to disguise money as wealth versus income. And of course, it's only income that you can possibly have a chance at taxing. That, you know, to lift the top marginal tax rate a few points, I don't think that would change Peter Thiel's situation one eye. None of the billionaires. This is why I have become an enthusiastic supporter, actually, of estate tax. Because you know what the easiest way in order to capture all this stuff is? Upon death.

Yeah. Whenever he tries to pass it off to somebody. I am a huge supporter of the estate tax. That's what it is. And look, we can carve it out for the farmers. I've heard it all before. Listen. They'll find one person in the entire country.

They'll find the one farmer out there who deserves it look do a whole farmer carve out i don't care these are the types of people where i do believe at this point that even with all the legal maneuvers like with the roth i are in there there's always just going to be people out there who do something like this and there's just the only way to capture it is upon death that's it in order to tax the estate whenever we're talking about inheritance so inheritance just has to be one of the only ways that we can do this. And we can do it legally. It's already written into the tax code.

There's not constitutional concerns the way they are with the wealth tax. So I think that this is probably just the absolute best way to go. I know that'll piss a lot of people off. But, I mean, you can't look at this and say that some money on that has to be taxed. I'm sorry. That's the country that we live in. It has to be. And. I'm sorry. That's the country that we live in. It has to be. And it's just not fair.

Well, we're not supposed to be a nation that believes in, like, dynastic wealth. Yeah, I don't believe in that at all. That's supposed to be what we're all about. That if your parents happen to do well, that you should be set up for life and that we should have this permanent plutocracy class. And because the estate tax has been chipped away and chipped away and chipped away, and because there are so many loopholes also involved in the estate tax, that's exactly the system that we've ultimately set up as an American aristocracy. No, bingo. Look,

intergenerational wealth from coming to lower middle class to upper middle class or upper middle class to upper class, and we're talking about still below the top 2% of income, totally cool. That's bedrock of the American way of life, home, and all that. But this is talking about billionaires, and we're talking about the American aristocracy. That is something we are 100% against here on this show. Yes. Speaking of, this is the other piece of politicians protecting billionaires and the wealthy from paying taxes. One of the primary movers and shakers in helping to fighting to cut taxes for the wealthy has been Congressman Josh Gottheimer. Notably, very, very much in favor of aggressively advocating for reinstating that SALT tax cap. Of course, you guys know the statistics that that would overwhelmingly benefit the top 1% of income earners.

Those are the types of people that are very influential in sort of like local congressional districts, the type of people who might be kicking in campaign cash, might be holding local fundraisers for you, etc. So Congressman Gottheimer actually went on CNBC to continue to push aggressively to get that SALT tax cap back reinstated. And he actually got a tiny bit of pushback from this anchor. Let's take a listen to what happened. In terms of those leaving the state versus coming. So you start looking at numbers like that and then look at the census numbers and the growth compared to other states over that same period of time. You realize that New Jersey and New York and places like that

are not gaining, not gaining people. We're losing people net-net to other states, especially at the top end. We're losing a lot of people and businesses and jobs. So this is really about our economy. It's about making sure we make things more affordable for families so they can stay here when they retire. And the bottom line is, I believe we're going to fight for and get the full reinstatement of the salt deduction when all things are said and done if we go forward with this package on reconciliation. So what was notable about that is first she did actually push him on a couple of questions. But then while he's talking there, for those of you guys who are listening, they actually throw up a graphic that accurately portrays

who the SALT tax cap would benefit. So while he's out there making the case that, oh, this is going to be great, right? Middle class. Middle class tax cut. This would be good for bolstering the middle class in the state of New Jersey. Even CNBC is kind of like passive aggressively

calling bullshit on his talking points there by putting up a graphic on the screen that shows, no, actually overwhelmingly this is going to benefit the top 1% of income earners. Oh, yeah. I mean, I could put the graph up a million times. We already have. In terms of the people who this benefits, it's people who make over a million dollars. I mean, I always get contacted by like some guy who makes like 300 grand or something

and lives in New Jersey. He's like, do you have any idea how expensive it is to live in northern New Jersey? And you know, sir, I do generally feel for you. I do also think that the extra $20,000 or whatever there combined with the policy, which is going to benefit multimillionaires to the tune of millions of dollars in their taxes. Well, I'm sorry. And if you want to change the tax code to benefit you, I'd be for that. But this is the thing, which is this is overwhelmingly a gift to the top 1% of New York and California. Call it for what it is. And it just so happens the Speaker of the House of the Democratic Party is from San Francisco, which is one of the overwhelming places where the SALT tax

deduction is overwhelmingly beneficial. And the majority leader is from New York State, which is another place where the SALT tax is hugely beneficial. I just wonder why this happens to be in our debate. But Crystal, you flagged this, too, around who exactly has done a little bit of an about-face on this, and it's kind of nuts. Gives me no pleasure to report on this one. So Bernie Sanders had actually talked about this before

in a previous interview. Let's take a listen to what he said explicitly about the SALT tax. Restoring the state and local tax deduction, the SALT, which is a tax break for rich people in blue states. You don't support that. No. What do you think if Democrats bring that back? It sends a terrible, terrible message. So ultimately, what you have got to do, and fairness to Schumer and Pelosi, it is hard when you have tiny margins. But you have got to make it clear which side you are on. And Crystal, so what is in his new budget? Let's put this up there on the screen. It's Bernie himself who's actually included the SALT tax there. Yeah.

SALT in the wound. That is right. SALT deduction relief included in Bernie Sanders' budget proposal after him saying accurately that it sends a terrible, terrible message about which side the Democratic Party is on. And look, this isn't a done deal yet, but there's also a story here about like Gottheimer and the other salt tax caucus members. They drew a red line on this. They were, yeah. I mean, no salt, no dice. I think that's what Gottheimer or one of his acolytes said about this tax. And progressives initially drew a pretty firm line and were clearly opposed to this.

And it seemed like it was going to be, you know, an area of some tension and friction and that we're going to have to have some kind of a public debate about whether this ultimately gets included. But, you know, it appears that they are beginning to cave on this. And so, again, it's just this asymmetry

of the right-wing Democrats willing to go so hard. And so, again, it's just this asymmetry of the right-wing Democrats willing to go so hard. And when they do go so hard, they win. And the progressives, you know, they may say they need this or that, or we need climate change this, or we definitely need the reconciliation bill to be tied together with the infrastructure package is the perfect recent example. And then when Biden gets pushed on that, when he initially takes the correct position from the progressive point of view of these things got to be tied together, he instantly caves to not just the right-wing Democrats, but instantly caves to the Republicans on those things. So all of this idea

of like, oh, progressives, we promise you, you've got so much influence in this administration. Just look at all these. Look, we patted you on the head with a nice little tweet. Ron Klain sent out a nice tweet about you. Don't you feel influential? Don't you feel powerful? Ultimately, when it comes down to it, it seems like there are very few wins here. And that's before even talking about like minimum wage hike, gone, nowhere to be found. Public option, gone, nowhere to be found. Now they're trying to act like if they manage to get the Medicare age lowered by five years, that that's some gigantic win and would it be an improvement? Yeah, it's an improvement. But let's not pretend when,

you know, Medicare for all was whatever we were talking about just a year prior, that this is anything approaching what is required in the moment or what Americans need and what the left has stood for. So just one more. It's a good illustration of power. One more sad example of that. And actually, it fits in a way with our with what we wanted to talk about next, which is the passing of American hero Mike Revell, who certainly was willing to go against the grain and push power and do things that were very uncomfortable for his own side. It's like going into the Senate. You know, the first time you

get there, you're all excited. My God, how did I ever get here? Then about six months later, you say, how the hell did the rest of them get here? And I got to tell you, after standing up with them, some of these people frighten me. They frighten me. When you have mainline candidates that turn around and say that there's nothing off the table with respect to Iran, that's code for using nukes, nuclear devices. I've got to tell you, I'm president of the United States. There will be no preemptive wars with nuclear devices. In my mind, it's immoral, and it's been immoral for the last 50 years as part of American foreign policy. Let's use a little moderator discretion here.

Senator Gravel, that's a weighty charge. Who on this stage exactly tonight worries you so much? Well, I would say the top-tier ones. The top-tier ones. They made statements. Oh, Joe, I'll include you, too. You have a certain arrogance. You want to tell the Iraqis how to run their

country. I got to tell you, we should just play get out. Just play get out. It's their country. They're asking us to leave and we insist on staying there. And why not get out? What harm is it going to do? Oh, you hear the statement, well, my God, the soldiers will have died in vain. The entire deaths of Vietnam died in vain. And they're dying in vain right this very second. You know what's worse than a soldier dying in vain is more soldiers dying in vain. That's what. Little taste there of the total passionate moral clarity that Senator Mike Gravel had. Didn't care who he made uncomfortable. Didn't care whether it went against- Calling out Joe Biden.

He called out Joe Biden as well in those debates, Hillary Clinton, Barack Obama. Totally fearless. And by the way, Sagar, it's 50 years ago today that Mike Gravel read the Pentagon Papers- Wow, on the Senate floor. Into the congressional record. The Nixon administration had tried to blog. There was a Supreme Court case. New York Times was moving forward with publishing some of these memos. I mean, this was really a look at exactly what normally gets hidden from the public of how these incredibly significant war-making decisions were made. One of the things that was revealed is basically like there was no debate effectively within the administration over like, well, should we even be doing this?

It was just a total assumption that, of course, you know, foolish hypothesis about the domino effect and how ultimately communism would sweep through on Asia and then to Europe and it'd be the end of the world. So an absolutely fearless iconoclast. I was a little bit pissed off about the way that, I don't know if you read any of the mainstream obituaries, but they all painted him as like this weirdo, gadfly, crank, et cetera. And that's the danger of if you dare to go up and challenge Joe Biden and Hillary Clinton and Barack Obama and the powers that be within the Democratic Party, then even to your dying day, they will smear and dismiss and try to marginalize you as a kook. No, it's very sad. He did a heroic thing with the Pentagon Papers. And you're right. I mean, you know, I interviewed him. I think we both interviewed him twice while he was around. He was just so fun to talk to. He was a hilarious guy too, in terms of getting into contact with him and seeing exactly. He had some real thoughts about Pete Buttigieg. Yeah, he left it all out on

the table on Pete Buttigieg. I believe he said, he's like, I just think he's young and he's gay. He got himself in trouble for that one. I know the Gravel kids were very mad at him. But look, that's who he was. He said it exactly

how it was. And he called out everybody. He was somebody who it was a real joy in order to talk to. And I think those kids actually deserve a legacy

as well as that documentary. We had the documentarian on on Rising. Yeah. I forget his name, but American Gadfly. And I know that everybody, you can go watch that right now if you want to learn a little bit more about him. So it was a fascinating thing to see. I think, how old was he? Like 92? 91, I think. 91 years old and still able to have an impact on American politics so many

years later. Incredible thing and inspire an entire generation. Yeah, he was age 91, died at home with his family. I feel like you're incredibly lucky to have gotten to speak with him while he was still here. And I mean, he was very sharp and cogent in our interview. Oh, absolutely. This was like a year ago. Yeah, in our interview with him. And I absolutely agree with you, the fact that you now have the Gravel Institute carrying on his fearless legacy, that you had a younger generation who really learned about just how much courage this took and how significant this act was in American history is a profound service. So rest in power, Mike Gravel. You will absolutely be missed for legendary moments like the one that we just played you. Yeah, that's right.

Wow. You guys must really like listening to our voices. While I know this is annoying, instead of making you listen to a Viagra commercial, when you're done, check out the other podcast I do with Marshall Kosloff called The Realignment. We talk a lot about the deeper issues that are changing, realigning in American society.

You always need more Crystal and Saga in your daily lives. Take care, guys. All right, Crystal, what are you taking a look at today? So I don't know if y'all have noticed, but the modern GOP doesn't really stand for a whole lot of anything these days. I mean, quietly, they certainly still fight for the same corporate tax cuts and neocon wars that they have long supported. But publicly, they're not quite so confident about going to bat for the economic protection of the wealthiest among us. Instead, they've really staked their entire political project on one big theme,

cancel culture. The idea that all of these stick-in-the-mud liberals are using authoritarian tactics to silence debate, ban books, pull Twitter accounts, and fire wrong thinkers. So I was shocked, shocked to see the right leap in luck step to cancel an American athlete for daring to protest. Just kidding, of course. Hypocrisy on speech issues is literally par for the course for all partisans who fully support censorship, so long as it only applies to their ideological enemies. So here's the story this time. Olympic hammer thrower Gwen Berry, she secured her spot on the U.S. Olympic team with a bronze medal finish. As the national anthem played while Berry was on the podium, she turned her back to the flag and towards the stands and

placed a t-shirt over her head that read activist athlete. Now, apparently the action wasn't actually fully planned. Barry had thought that the anthem would be played before she took the podium. In any case, she explained her actions by saying that, quote, my purpose and my mission is bigger than sports. I'm here to represent those who died due to systemic racism. That's the important part. That's why I'm going. That's why I'm here today. Now who died due to systemic racism. That's the important part. That's why I'm going. That's why I'm here today. Now, maybe you support the statement. Maybe you don't.

Here's the thing about the First Amendment. You don't have to like what a person is saying or support the cause they're backing to believe in their right to protest. But, of course, some of the very same people who appear in Fox News segment after Fox News segment, hand-wringing about censorship, immediately melted down over Barry's protests and called for her to be canceled. For example, here is Dan Crenshaw calling for Barry to be banned from the Olympic team. She turned her back on the flag during the anthem, and she also put a black T-shirt over her face that said, activist athlete. We don't need any more activist athletes. I, you know, she should be removed from the team.

The entire point of the Olympic team is to represent the United States of America. It's the entire point. Okay. So, you know, it's one thing when these NBA players do it. Okay, fine. We'll just stop watching. But now the Olympic team,

and it's multiple cases of this, they should be removed. That should be the bare minimum requirement is that you is that you believe in the country representing. But look. Now, I am old enough to remember a time when Congressman Crenshaw was distraught about cancel culture. Can throw his tweet there up on the screen. He's passionately arguing, as he does here, that we need to cancel, cancel culture. He was far from the only hypocrite

here, though. Here's Mike Huckabee with a similar sentiment, saying that Barry's protest was disgusting, and also calling for her ban, saying she doesn't deserve to wear the same flag as those who died for her arrogant, childish stunt. What can we do to push back against this authoritarian instinct to silence all dissenters? Well, let's ask Governor Huckabee. Brandon writes, Mike Huckabee, what do you think it's going to take to reverse the cancel culture trend? You know, I'm going to tell you, it's simpler than people think it is. It's standing up and saying no. Thank you for that, Governor.

That's the wrong camera, guys. What's going on today? Ready? Thank you for that, Governor. Naturally, Peter Doocy was already at the White House press briefing with a question on Gwen Berry to feed into Fox's latest addition to the culture war. Gwen Berry, who hopes to represent the United States as an Olympian on the hammer throwing events, won a bronze medal at the trials and then she turned her back on the flag while the anthem played. Does President Biden think that is appropriate behavior for someone who hopes to represent Team USA? I mean, it's not like there's anything important going on, guys, like bombs being dropped in Syria, numbers of hungry Americans suddenly jumping upwards, or preparations underway to literally sell off the nation's public infrastructure.

All of these instances of hypocrisy, though, they really just give away the game. They aren't opposed to cancel culture and censorship. They just want to be the ones who are doing the censoring. And for most of American history, conservatives have, in fact, been in charge of doing most of the censoring. And the fact that there's any slippage in this power is now cause for a complete meltdown. But liberals are not getting off the hook in this monologue either. So over on YouTube, Right Wing Watch, a channel that reposts content from right-wing sources in an attempt to expose conspiracy theories and fringe views and bigotry. They were permanently banned from

YouTube for a few hours yesterday before ultimately being reinstated. Now, first of all, let me just say, given all that we just discussed with Gwen Berry, wasn't holding my breath for principled conservatives to complain about the censorship, and they didn't. And second of all, let me make the obvious point that anyone on the pro-censorship left who thought this crap wouldn't come for them too was a fool. Right-wing Watch having their channel temporarily banned is far from the first instance of left content being pulled from these platforms. But in addition, right-wing watch's brief cancellation presents a vexing and confusing problem. You see, the entirety of their channel was simply reposting verbatim right-wing content from other locations. And it is the position of quite a few liberals

that while the original right-wing content should be banned, the repost of that very same content by Right-Wing Watch should, for some reason, be allowed. So again, by this thinking, the good guys should be allowed to post the very same content that is disallowed for the bad guys. Now, I don't personally feel excited about letting our tech oligarchs make these kinds of determinations of moral character and of intent. For the right, they take the exact opposite position. They're either silent or happy that right-wing watch was temporarily banned, but they would be outraged and going on Fox News to complain if the original content were banned. Again, it's the same content

just posted by different channels. So what I've come to realize with all of this is that actually liberals and conservatives have exactly the same position on the issue of cancel culture. They like it when it serves them and they hate it when it doesn't. The right happens to be savvy enough to adopt the language of freedom while pushing for authoritarianism. Liberals are more honest that they actually do want censorship by big tech of their ideological opponents, but they offer a more politically stupid framing of that same position. So it all comes down to this. If you are confident that given a free and fair hearing, your ideas will actually win, then fight for openness. The right to put those ideas in front of the American people on

an equal playing field. The terrible instinct to try to work the refs and rig the rules, that comes from a lack of confidence that you're offering anything that can stand on its own merits. It says everything about the bankruptcy of mainline Democrats and mainline Republicans that they would rather silence dissent than have to actually make a compelling case. And I thought this brief thing with the right wing. One more thing, I promise. Just wanted to make sure you knew about my podcast with Kyle Kalinsky. It's called Crystal Kyle and Friends, where we do long form interviews with people like Noam Chomsky, Cornel West and Glenn Greenwald. You can listen on any podcast platform or you can subscribe over on Substack to get the video a day early.

We're going to stop bugging you now. Enjoy. Sagar, what are you looking at? Part of the reason that I love doing this show is that Crystal and I are truly free of the day-to-day news cycle. And if we want and don't have to rely on clicks or algorithms to ensure our success. Instead, it gives us the space when we would like to dive a little bit deeper. Look at our politics, the state of our country, and our culture. Point out to all of you some of the reasons that all of us are living life the way that we are. Why are we so frustrated? What needs to be fixed? I stumbled across a quote yesterday on Instagram. It actually really hit home to me. I wanted to

share it with all of you. It's an excerpt from The Demon-Haunted World by Carl Sagan in 1995. Quote, I have a foreboding of an America in my children or grandchildren's time, when the United States is a service and information economy, when nearly all key manufacturing industries have slipped away to other countries, when awesome technological powers are in the hands of very few, and no one representing the public interest can even grasp the issues, when the people have lost their ability to set their own agendas or knowledgeably question those in authority. Adding that our critical faculties in decline will be unable to distinguish between what feels good and what's true. We slide, almost without noticing, back into superstition and darkness. I truncated that quote slightly. I encourage you all to go

read the full thing. But I'm just struck by how absolutely spot on that rings today. We feel increasingly disconnected, consumed with short form media. As Carl says in there, 30 second soundbites have been reduced to 10. He predicted the rise of TikTok in 1995. And look, I'm not a technological doomerist or anything, but increasingly, especially after a year of isolation for so many, I look around and I just feel like there's a tension in the air that gets thicker. And that's not just, it turns out you can actually kind of quantify that. The number of Americans who are reporting lots of close friends is down dramatically. In 1990, around the time that Carl Sagan wrote that book, 33% of Americans said they had 10 or more close friends, not counting relatives. The distinct minority were the 3% of Americans said they had 10 or more close friends, not counting relatives. The distinct

minority were the 3 percent of Americans who said they only had 3 close friends, including relatives, with varying percentages that you can see there. Now, in 2021, the number of Americans reporting 10 or more close friends, that dropped to 13 percent of Americans, a full 20 percent decline. And it's not like it was spread out. The number of Americans who reported between 6 and 9 friends in 1990 is now roughly equal to the 12% of Americans in 2021 who say they have none. Zero close friends. In 1990, that wasn't even a statistically significant category. It didn't even rate. Not many people even had any no close friends. So the pandemic wasn't the only cause. The main one seems to be this.

Americans are working longer hours and traveling more for work than ever before. It seems to have come at the cost of maintaining close friendships. Those close friends who you do still have, well, statistically today, you are much more, orders of magnitude more likely to make friends at work than anywhere else, including school, in your neighborhood, in your place of worship if you attend one, or even through your existing friends. Again, I don't want to paint too devastating of a picture here. People still have best friends. Many people have situational friends. But what I really see in the data is the total loss of community for a lot of Americans and the true triumph of the professional managerial class over everyone else. Now, I am one of these archetypal PMC Americans in a lot of way. First generation American, grew up in a smaller town,

moved to a major metropolis for college, never left. Work in the service sector. All of the people that I'm friends with in DC generally are people I met through work or work-related activities. This is the life of the cosmopolitan elite. It has been that way for decades. But the difference is that unlike in 1990, the elites have now structured the economy even more so, such that everybody now has to live life the way that they do. Now, I fully recognize that the way

that I and many of my friends live is not for most people. And there is nothing wrong with that. The problem that we have is that because we have a top-down economy and culture, elites have transferred their love of work down to people who don't necessarily want to live this way. They have transferred their lack of connection to geographical places to people who really enjoy living 10 miles away from their mom. And they have transferred their indifference to marriage and having kids down to many of the people who want to do so much earlier than they are, but are not able to do so for economic reasons. I don't want to say any of this to bum you out, only to say what we have is pretty precious, and we should fight for it. And we shouldn't allow

people, frankly, who are like me, to have all the power in the world. Work is important, but it shouldn't be everything. I mean, look, the worst times I've ever had in life were moments where you put work before everything. And yet, that's the value set that we've cherished. And we have now forced most Americans to comply and live their lives this way. Coming back to Carl Sagan's quote, I think it comments about the power in the hands of the few is what matters most. The keys to power, be it technology, government, cultural, or economic, all lie in the hands of the few is what matters most. The keys to power, be it technology, government, cultural, or economic, all lie in the hands of fewer people than ever before in modern American history. And the populace is increasingly distracted to their benefit, watching videos and engaging in algorithms or work that adds billions to bottom lines,

while people lose all of the things that make life worth living. The only way out of this hellish system is to change it. And the luck that we have is that there are enough people out there who aren't too old, who still have a chance. So let's just do what the boomers did. Let's just change the country to the way that we want it. Our lives and our happiness actually can literally depend on it. I thought this data was really interesting, Crystal, about close...

Research Director for the American Economic Liberties Project, Matt Stoller, joins us now to talk about that landmark decision in the Facebook case. Good to see you, Matt. Thanks for joining us, sir. Thanks for having me. Absolutely. So, we had this big court decision. Let's put this up there on the screen. It broke on CNBC. Yesterday, district court, who is throwing out the FTC and state antitrust complaints against Facebook. Facebook stock, Matt, afterwards climbed a collective one, is worth now $1 trillion after the U.S. court's dismissal of these antitrust lawsuits. And it was an Obama-appointed judge who made this decision in the first place.

Lay out for us exactly what happened here. Is this the end of the antitrust suit against Facebook? Does the government, do the state attorneys general, do they have the ability to appeal this? And then what does this generally say about the, you know, legal legacy that a lot of establishment liberalism has left us on this? Yeah. Yeah, no, it's like $1 trillion. That's like nicely poetic, because usually stocks like react, but it's not usually like that fun a number. Right. Yeah. So, so the last week, Congress was debating, there's a context here. Last week, Congress debated, and actually the Judiciary Committee passed a bunch of laws, some to strengthen general purpose antitrust laws, some to actually take on

big tech directly. And all the bills passed, just the committee. But there's this debate in Congress about whether our laws are strong enough to deal with the tech firms writ broadly, but also monopolies more generally. And the big problem that we have is the main one. It's not the only one is that the judiciary, like judges are super deferential to monopolists. And so there's this big controversy last week in Congress. And then today, uh, and a bunch of people are like, ah, the laws are fine. And then today a judge or yesterday, a judge dismisses these cases, these antitrust cases against Facebook and big headlines. It's not as it's sort of from, I'm an anti-monopolist, but it's not as bad as it seems. The headlines are kind of worse because the judge, the state, there are two cases and the judge said one of the cases can be refiled.

The other one is done. Right. So one case is a set of state attorneys general. He dismissed that entirely. They have to appeal. They can't refile for weird bureaucratic reasons that are problematic, can be fixed by Congress. That's a problem. He basically said they waited too long. And because of bureaucratic reasons, state AGs are not considered part of government when they bring an antitrust case. They're considered private plaintiffs. It's weird and dumb and they should fix it. But that case is kind of done. They can appeal it. Um, but it's a very narrow bureaucratic appeal. The other one, which is the federal trade commission, uh, they are trying to undo mergers. They have two basic claims. They're saying Facebook bought WhatsApp, they bought Instagram and those were to its monopoly. they also marketed an open platform and said come

build on our platform and then they killed apps like Vine or others who they perceived as competitors and the FTC said that that's a violation of anti-monopoly laws. And the judge said that the murder claim can go forward. They can go after the acquisitions of Instagram and WhatsApp, but the other ones can't. But then he dismissed the whole complaint because he said, well, the FTC didn't prove that Facebook had monopoly power. However, they can refile it in 30 days. So it's a kind of bureaucratic judge who's a little bit of a snob saying to the FTC, you know, I buy a lot of your complaint, but I don't like how you wrote it. I think you were a little lazy and you got to

show me some respect. So write it again and submit it again. And also this one particular complaint about Zuckerberg crushing people. Zuckerberg is allowed to crush anyone who wants. He wants. That's how the law works. And so we're not going to allow that to go forward. So that's where we are. And it shows a lot about how screwed up our legal system is, that judges are so deferential to monopoly power.

Yeah. But it also, it's not the end of the road here. It's kind of a better headline for Facebook than it actually is in practice. Interesting. So yeah, just to bolster what you were saying there, part of what the judge wrote is that the FTC's complaint says almost nothing concrete on the key question of how much power Facebook actually had and still has in a properly defined antitrust product market. It is almost as if the agency expects the court to simply nod to the conventional wisdom that Facebook is a monopolist. Do you think that there was any truth to the claim that the FTC basically didn't do an effective job of really making the case that Facebook is a monopolist here?

As the judge is saying, basically, like, y'all just assumed that I was going to think that they were monopolists, but you didn't really prove their case. Do you think that that argument from the judge had merit? I, you know, I mean, you know, it's Facebook. Come on. I mean, the judge basically wrote that. He's like, yeah, it's it's Facebook. Everybody knows it's a monopolist, you know, but you have to be more evidence. And you could make one of two claims about it.

One is that the Fc had a lot of information about the market structure including market shares they could have said you know facebook is sticking more ads in the news feed which is a degradation of product quality they're doing a lot of things that indicate that they have market power and the they didn't do that and they didn't do it for strategic reasons they they wanted to hold back because later on in the trial, they want to present this evidence and they don't necessarily want to give that away what their whole strategy is. Or you could say they didn't do a particularly good job at, you know, they just they just sort of were bad at what they do. They don't know, really know how to litigate one of these. Either one is sort of a legitimate viewpoint.

But the judge, you know, the third, the broad like issue here is that this is a motion to dismiss, which means it's not even the trial. It's just a question of whether the judge says if any in under any plausible scenario, a jury might rule for the government. And he's like, no, there's no way that the jury would ever with this complaint even rule against the government. So it's kind of an insane decision from a judge. And I mean, the FTC should have sort of should have seen this coming. They should have done a better job. But, you know, the law, like it really should be fine to bring a case and say, look at Facebook, their Facebook, right? They're clearly a monopoly. I want to, you know and they're doing these things i should get

a trial you don't necessarily win the trial but you should get a trial that's how the law should and so it's a crazy decision the ftc also kind of bad at what they do but uh and like facebook you know make better kind of better arguments but we're at the dismissal stage so that should require a much lower standard of proof. Gotcha. Makes sense. And so, Matt, just generally in the future, like you're saying, it's not as good for Facebook as some people might say. What are the developments in the congressional and then the FTC front?

Like you said, they're going to have to refile. That's one thing that can happen here. Is there promising action on the federal level, which seems to be most promising at this time? Yeah. So just to bring like a broader context here. So the claims that the government made about Mark Zuckerberg crushing rivals and doing things to maintain his monopoly, this is not just about Facebook. This kind of behavior happens in every industry you could think of. It is why insulin prices are so high. It is why in many cases, it's really hard to find the best airline price. It is why you see high prices and lower wages across the board in virtually every industry that you can think of, from peanut

butter to hospitals to mail sorting software, whatever it is. This is why it's because judges rule this way. And we're seeing it on Facebook, right? This is how the law applies in this particular case. But, you know, imagine if people weren't paying attention, how deferential a judge would be. But going forward to your question, what is likely to happen is that you're going to see more action. judge. So this isn't like some, you know, the Democrats aren't going to be like, oh, this is an evil Trump judge, which is silly. But, you know, it's a judge who just said, I'm not going to really buy that Facebook is a monopoly. So this adds a lot of fuel to the fire when people in Congress who want to change the antitrust laws, who want to say, let's make this stricter, let's take away discretion from judges in making these kinds of claims. And that's what I think

the big takeaway is here. I think in 30 days, you're going to see the FTC bring a different, more sophisticated set of claims, and then we'll move on from there. Matt, the last question I have for you is some make the case that social media companies are basically natural monopolies, right? They're sort of similar to public utilities, like obviously the value of a social media company is that everybody's there. And so this creates a sort of natural monopoly situation. Do you think that that is, in fact, the case? And what would the policy implications of that ultimately be? Yeah, it's a great question.

You know, we've had these kinds of network systems before, everything from railroads to telegraphs to the phone system in, you know, AT&T. I think it's sort of an open question whether whether these are kind of quote unquote natural monopolies. AOL Instant Messenger could, said you have to open up your system to rivals. And then a bunch of rival instant messengers, clients got in and started to open up and make that a competitive market. It's really clear there are network effects here. There are economies of scale. But, you know, the Internet is a it is a has network effects and economies of scale. There's nothing that says that that network effects and economies of scale. There's nothing that says that network effects

and economies of scale have to be contained by a corporation. Like email has network effects and economies of scale and no one owns that. But it is possible that some of these systems have to be contained within a corporate entity. I'm not sure about social networking. If that's the case though, and maybe even if it's not the case, then the traditional American remedy to that is public utility law.

So that would be the government saying, here are the prices you can charge in terms that you can set. That would be privacy or it would be, you know, how you can you can amplify or whatever. And then, you know, you you usually non-discriminatory treatment of all comers onto the platform. Basically, if it's a, if it's an important social institution, as the railroads were, as the telegraphs were, as the telephone was, um, as the internet is, then the government sets the terms and conditions. We, the people set the terms and conditions so that nobody gets, uh, so everybody gets equal access to this vital social resource. I'm not totally convinced that it's a natural monopoly, but if it is,

or if there are network effects that you can't get away from without having a corporate structure overlaid, then, you know, we have rules, we have ways of dealing with that and we should just sort of bring them back. They're pre-1970 rules, but they work. Yeah, that's a really smart point. Really appreciate you joining us, Matt. Really appreciate it. Great to see you, Matt. Thank you. Thanks a lot. Absolutely. Thanks for everybody watching. We really appreciate it. If you guys want to support our work here, you can support us at become a breaking points premium member, you get to watch the entire show uncut completely one hour early, listen to it uncut as well. We would really appreciate it yesterday. Um, you know,

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