Breaking Points with Krystal and Saagar - 9/21/21: Roe vs Wade, Stock Market Tanks, Debt Ceiling Battle, Maskless SF Mayor, Obesity Crisis, Natural Immunity, SALT Tax, Drug Prices, and More!

Episode Date: September 21, 2021

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This is an iHeart Podcast. I also want to address the Tonys. On a recent episode of Checking In with Michelle Williams, I open up about feeling snubbed by the Tony Awards. Do I? I was never mad. I was disappointed because I had high hopes. To hear this and more on disappointment and protecting your peace,

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process, learn. Learn from it. Check out this exclusive episode with Ja Rule on Rock Solid. Open your free iHeartRadio app, search Rock Solid, and listen now. You say you'd never give in to a meltdown. Never let kids' toys take over the house. And never fill your feed with kid photos.

You'd never plan your life around their schedule. Never lick your thumb to clean their face. And you'd never let them leave the house looking like less than their best. You say you'd never put a pacifier in your mouth to clean it. Never let them stay up too late. And never let them run wild through the grocery store. And I'll three. So when you say you'd never let them get into a car without you there, no, it can happen. One in four hot car deaths happen when a kid gets into an unlocked car and can't get out.

Never happens before you leave the car. Always stop. Look, lock brought to you by NHTSA and the ad council. Hey guys, thanks for listening to breaking points with crystal and saga. We're going to be totally upfront with you. Look, lock. Brought to you by NHTSA and the Ad Council. millions of dollars doing it. To help support our mission of making all of us hate each other less, hate the corrupt ruling class more, support the show. Become a Breaking Points premium member today, where you get to watch and listen to the entire show ad-free and uncut an hour early before everyone else. You get to hear our reactions to each other's monologues. You get to participate in weekly Ask Me Anythings, and you don't need to hear our annoying voices pitching you like I am

right now. So what are you waiting for? Go to BreakingPoints.com, become a premium member today, which is available in the show notes. Enjoy the show, everybody. Happy Tuesday. We have an amazing show for everybody today. What do we have, Crystal? Indeed, we do. Big stock market drop yesterday. That famous graph of rich people's feelings was down. We're going to dig into what exactly is going on there. Actually, very interesting story about the real estate market in China and whether they may be facing their Lehman Brothers moment right now. So we'll talk about all of that. I did a super deep dive into all of this yesterday. I know you did too. Crystal is now an expert in Chinese real estate markets. I wouldn't go that far, but I did learn a lot. There is a debt ceiling crisis that is headed

our way imminently. We'll talk about what is happening there. San Francisco Mayor London Breed with some incredible comments trying to defend herself after being caught maskless partying at a nightclub in violation of her own public health order. Very awkward situation. Very reminiscent of Gavin Newsom. French laundry vibes there. New study that's very disturbing about how much

childhood obesity ticked up during the pandemic and what is going on there. We've got David Sirota on as well to break down what exactly is going on with that big Democratic reconciliation bill. It really seems to be in big trouble right now. Frankly, it's hard for me to see how they get either the reconciliation bill or the bipartisan infrastructure bill done at this point. But David is kind of expert in knowing all the nuances of how these things actually move through Congress. But we wanted to start with a big announcement yesterday regarding the Supreme Court and Roe versus Wade. Yeah, Crystal, you and I were just talking about this. I think a lot of the professional

kind of intelligentsia and news people are overlooking what could be probably one of the most significant political events of our entire lifetime. So let's put this up there on the screen. The Supreme Court yesterday set a date for oral arguments in the Mississippi abortion case, December 1st, 2021. So this is very important because as Kate notes there specifically, many past abortion laws that we have seen to try and test the conservative court, quote unquote, have been kind of like what we see in Texas. Six-week so-called heartbeat bill, same thing down in Alabama. The Mississippi case was incredibly important on this ground because the brief specifically says we want you to overturn Roe versus Wade. There was no six week. There was no like instituting some sort of regulations, which make it so there's only like four abortion clinics or whatever in the state. It was straight up. We want you to overturn the pass court decision. So that is

actually one of the most significant things that the court has taken in quite a long time because it gives us some insight into the fact that they are willing to hear and finally decide either one way or the other. Now, look, we've got 6-3 right now currently on the Supreme Court. Many people who I've spoken to in the conservative legal movement are both, I mean, you know, they're the ones who are happy about it, but I asked them for dispassionate analysis. I said, okay, so what does this mean? I mean, previously what I'd heard was, well, they have a 10-year project to try and overturn Roe versus Wade. They're like, they'll change Casey. They'll change the way the regulations. But the fact that Mississippi kind of teed it up for them in such a specific way and that the court

was willing to accept it, this signals that they'd be willing to do it. And here's why I think it matters more than anything. So the people that I spoke to said that in fall or summer of 2022 is when, because they're hearing the arguments in December, fall or summer is when the actual ruling on it would come. Now, you may know November of 2022 is the election. So there we go. We've got November 2022 and potentially bombshell decision that could come, which would completely, in my opinion, reshape American politics. You could almost throw everything currently in the discourse out the window except for COVID. And that's what the entire election could be about. Yes. It is a very highly significant development. Abortion pro and anti-organizing has been a centerpiece and a focal point of American politics, obviously, for decades now. It's been a huge motivator for the right. Huge. I mean, even you think about Donald Trump's election back when now evangelicals are his strongest base, but back when there was some squeamishness about him and his personal conduct and how's this all

going to work out, when he released that list of Supreme Court justices with the implicit promise of these are the people who are actually going to get it done. What's been on your wish list now for decades. That was what really gave them confidence. Of course, Mike Pence on the ticket helped to add to that confidence there. They end up staying sticking with him even after the grandma by the P word comments, et cetera, come out. Big part of motivating the conservative base for years and years and years. So in some ways, if they actually get Roe versus Wade overturned, it's going to take some of the energy out of that movement because they've been questing after this time and time again. Now, as far as the

Mississippi law goes, you're correct in saying this was essentially crafted to force the Supreme Court to actually make a decision on Roe versus Wade. Why is it so directly a challenge for Roe versus Wade? Well, part of the law undergirding or the idea undergirding Roe versus Wade is this idea that abortion rights are guaranteed until fetal viability. Mississippi directly goes after that piece with a 15-week ban that is very clearly, it's not borderline, that's very clearly before fetal viability. And that's why it forces the Supreme Court into what is effectively a tough position here because I think the justices have been very leery of actually fully overturning Roe versus Wade. And we should be clear, because it has long been the

case that conservative states have been able to effectively ban abortion through all of these regulations and restrictions and infringements so that you have states that have one or potentially zero abortion clinics even operating in the state. That's been sort of a comfortable space for them to operate in. Now conservative activists are saying, no, no, we want the real deal. We want Roe actually gone. And so that sets up where we are now with these justices having their hand essentially forced to actually make a decision on something conservative activists have wanted for a long time and something that we should also say is wildly out of step with the American public. You know, I was just looking at the recent polling. There's, I think we have a Monmouth

University poll we can put up. Some of this is with regards to the Texas law that was just passed, which had really weird provisions in it. There's essentially like a bounty provision. It's not state lawmakers or regulators who are in charge of enforcing this Texas law. It's private individual citizens who can receive a $10,000 bounty if they turn in someone who conducted an abortion in violation of the law. That, of course, like even Republicans thought that that was strange and not necessarily a good thing. But if you look overall, what this poll reveals is that 6 in 10 Americans say that abortion should be either always legal or legal with some limitations. Another 24% say it should be illegal except for rape, incest, or to save the mother's life.

Those provisions, those exceptions are not present in the Texas law. Only 11% say it should always be illegal. So that 11% of the population is effectively who Republicans, conservative activists, and potentially the Supreme Court are going to ultimately side with. My view on abortion rights from a political perspective, and you and I have very different views about what is moral and what is just and what should be the policy, but from a political perspective, and you and I have very different views about what is moral and what is just and what should be the policy. But from a political perspective, whoever is seen as more extreme on the issue is the party that's going to lose out on it. Republicans and potentially the Supreme Court is putting Republicans in the place of taking a very extreme position on abortion that is out of step with where the American population is. Yeah, and this is something that

many socially conservative people don't want to hear, but it's absolutely true. It's like if you look at the politics of it, whenever you see like Ralph Northam or whatever advocating abortion up until like third trimester, then you're going to lose. And whenever it's on the other side, that's also incredibly unpopular. And the reason we're putting the polling there is because, as we have seen, if this becomes the litmus test issue, this could actually be one of the things that could stop any prediction of a big GOP wave in the November elections. Because then, like I said, it will be a referendum both on COVID, but also on how you feel about Roe versus Wade. Every single Republican politician will have to say they either agree or don't agree with the decision, the same thing, vice versa, whenever it comes to the Democrats. And I don't think there is a denying that the Democrats generally have the public opinion in

a post-Roe environment when many Southern states will make abortion explicitly illegal. And just to give you a preview, you actually pointed this out. Let's put this up there from the Gavin Newsom recall. So look, obviously California is a very liberal state, but one of the things that he consistently hammered against Larry Elder was not only opposition to minimum wage, but it was actually about the wake of the Texas abortion case and talking specifically there about being pro-choice. So that one's very important. You guys might remember this when Marshall was sitting in. I brought you this column from Matthew Continetti over at the Free Beacon. Let's actually put it up

there on the screen. One of the things he points to is that back in the 2012 election, when Todd Akin was asked, you know, made the whole legitimate rape comment, it became not only the death knell for Todd Akin's own campaign, but actually spiraled into something that almost every Republican in the country was then have to be asked about. And so what he's pointing to here is he's like, look, there's Afghanistan, there's the COVID lockdowns, you're seeing, you know, Glenn Youngkin is tied. He's like abortion is almost one of the only issues where because, like you said, the energies existed on the right for so long that in a post-Roe, especially in a post-Roe environment. But, you know, especially with the Texas abortion law, it would actually galvanize and activate many voters who feel, you know, obviously the opposite, who are, you know, not just pro-choice, but like kind of vehemently so.

And they have been in a more comfortable spot for quite a long time. They haven't felt the need to go to the ballot box in order to validate that vote. So all of the politics of this, I would say, are not good for Republicans. Many social conservatives I know are like, well, it's worth it. Who cares? And I'm just like, well, okay, you know, but I think we should at least be honest about, look, this whole segment to me is keep your eyes open about where things are headed. Yeah. Because I really do not think the national media is paying attention to the fact this could be a very, very, very, very different country in, what, a matter of a year?

Yeah, this could be a massive political moment. Right. That totally upends our expectations for what would happen in the midterm election. A couple more things on the politics of it. You point to Glenn Youngkin in Virginia. That race is extraordinarily close when it really shouldn't be given where Virginia is at this point. What they found in the polling is that the exurbs, which had moved to Biden and moved increasingly to Democrats and Democrats were sort of feeling like, OK, the exurbs, which had moved to Biden and moved increasingly to Democrats, and Democrats were sort of feeling like, okay, these exurban counties are now kind of like

Fairfax. They're solidly in our corner. They've started to move more towards Youngkin, who's this private equity dude who, you know, portrays himself as very moderate, sort of businessman type of approach. This is the type of issue that could flip those votes in those exurban counties, especially among women, very, very, very quickly. So Terry McAuliffe has been already leaning into this messaging about the extremism, especially of that Texas law, which really caught people's attention. There are also some numbers about a lot of people actually took note of that law and were paying attention to what was going on there. There was one more number I wanted to highlight in that Monmouth poll, which is they asked specifically on Roe versus Wade, and they

found 62% of Americans say that the Supreme Court should leave Roe in place, while just 31% want to see the decision revisited. So again, even if you throw in margin of error plus pollsters under sample conservatives, even if you throw all of those things into the mix, you still have a hefty margin on the side of Roe remaining in place. But more to the point, what have we been talking about with regard to the midterms? Enthusiasm. Republicans have been very motivated. They're very upset that obviously Democrats are, you know, in power in the House, in the Senate, presidency. They don't like that. They don't like some of the provisions that are being put into place. So they have been much more enthusiastic and much more motivated than Democrats who have

broadly, you know, gone back to brunch and feel pretty good because Donald Trump is out of the White House. This is the type of thing that could flip that enthusiasm and turn it on in just a moment's notice. And you saw this a little bit with Gavin Newsom, which is why the California race is significant here. Look, Gavin Newsom never should have been in trouble in California at all. Of course, part of that is just because of the weirdness of the recall process there. But there is no doubt that he opened up a massive gap at the end. And also that Democratic base voters got super enthusiastic right at the last minute. And that Texas law is a big part of the story. Why? Because then it became real. It became concrete. He could point to a very clear example of, hey, do you want this to come to California? Now, was that realistic? No. California still got two-thirds Democratic

majority in the Senate and whatever. They weren't going to pass this kind of law. But it made the threat very real to people, and it was highly motivating. You can only imagine how motivating it would be for a lot of base Democrats, especially the type of suburban voters that Democrats have come to count on now for their majorities, if Roe was actually threatened or ultimately overturned. Yeah, I think that's right. And, you know, our producer James pulled this, let's put it up there from the Wall Street Journal, is that Texas doctor, there's a Texas doctor who actually openly came out and was like, I violated the actual law. And now his private

action is being brought there against him. So that's another thing, you know, can turn into a media spotlight. I think it is one of the biggest stories in the country, as much as some people don't necessarily want to talk about it. I don't think the media is really setting expectations. The Biden administration, interestingly enough, seems to have their eyes on what is happening here. And in terms of the timeline this could all happen like I said very very quickly in terms of the judgment the justices have like I believe a 25-30 day period after hearing it in order to actually issue a judgment and from there then the state legislatures and all of them can meet and you'll be living in a totally different environment so something very much like right in your face the moment I saw it

I thought hmm you know let me reach out. Let me try and figure out exactly what's going on here. And the more I heard back, I was like, wow, this really, really could be one of the biggest stories that, you know, of our lifetime in terms of politics. I think especially because a lot of the Biden economic agenda effectively is falling apart. Which we'll get to. Yeah, which we will get to, especially with David Sirota, and I'm also talking about it in my monologue. But it is very likely that Democrats are coming into the midterms without a whole lot of concrete, tangible achievements that they can point to. And what we've seen, if there's one

thing we've learned, it's how, and not just this election cycle, but over decades now, it's how potent culture war really is. I mean, this is part of Thomas Frank, What's the Matter with Kansas? Part of what really adhered and moved a lot of white working class voters solidly into the Republican camp were issues like abortion rights and the distance between their own values and what they saw in the Democratic Party. So if that issue is, in a sense, sort of taken off the table, if they actually get what they want, politically, it does create a lot of challenges for Republicans because they can always use this as a way to motivate their vote. This time, give us power and we'll get that Supreme Court. It's going to happen this time. No, this time we're really going to do it. This time we're really going to mean it. And that's worked for a whole lot of years, even as the Supreme Court has not actually delivered on what's been promised to conservative voters. shift, not just for the midterm elections, but if you take that motivating issue effectively out of play, that gives Republicans actually a challenge at the ballot box to convince people that they still need to turn out, that there's still huge issues at stake for them when, let's be frank,

the Republican Party doesn't stand for a whole lot these days other than, we like Donald Trump. It really will set the map. I'm increasingly convinced of that. Interesting story here. So stock market, big drop yesterday. You can throw this CNBC tear sheet up on the screen that has the details. S&P 500 fell 1.7 percent, posting its worst daily performance since May 12. Broad sell-off with each of the main 11 sectors of the benchmark registering losses. Dow Jones Industrial Average also lost 614.41 points, or 1.8%. That was its biggest one-day drop since July 19th, and the tech-heavy Nasdaq dropped 2.2%. So, significant drop in the graph of rich people's feelings.

What analysts are saying is going on is a few things. Number one, COVID. Obvious. Delta variant is surging, creating a lot of uncertainty. Some new potential pullback, although consumer spending numbers that came in were actually relatively strong. But some still uncertainty about how is the economic picture going to fare, especially when you've just pulled a lot of the supports, the pandemic era supports, out from underneath the individual American consumer. So that's one obvious thing. Another thing is the D.C. brinksmanship that we're going to be talking about more.

You've got three things coming together. You've got potential government shutdown. You've got potential debt ceiling breach. You've got all the machinations around reconciliation bill that's also creating some uncertainty on Wall Street. But the one that I did the deep dive on is there are deep concerns about China and in particular, this gigantic property development group called Evergrande. So Evergrande has a massive amount of debt, $300 plus billion in debt. Now, the property and real estate market in China in general accounts for a huge percent of their GDP, something like 30%. That is massively more than the

U.S., even in the buildup to our own housing crisis. Okay, so this is a really, really significant part of the economy. And what has effectively happened here is that Evergrande and other large property development groups in China, they have used debt to grow and grow and grow. It's kind of a borrow from Peter to pay Paul kind of a scenario. You take out all this debt, you pay your contractors, you build the houses, you get payments in from people to build new houses, new apartments, and you're able to keep the cycle going as long as there is demand and housing prices keep going up. So two things happen. Number one, that demand and the housing market started to cool off. That put Evergrande in a very difficult position. In addition, the Chinese government has instituted what they're calling the Three Red Lines policy, which basically they recognize, and you can understand this from an American perspective

because we're seeing a very similar thing. Housing prices are just going up and up and up. They're getting wildly out of reach for people. It's totally overheated. It's this gigantic bubble. They're worried about these companies like Evergrande having these huge amounts of debt. So they put these new restriction regulations in place to try to slowly deleverage some of these property development giants. So all of these things came together to make it impossible for Evergrande to continue to

borrow more money, to continue kind of this scheme and this, you know, effectively a pyramid scheme, or like I said, borrowing Peter to pay Paul. So now they're in a place where they are on the verge of complete default. People are calling it a potential Lehman Brothers moment. You'll recall in the U.S. in the financial crisis, Lehman Brothers went under. They were so enmeshed with the entire economy that that triggers this massive domino effect, leads to the balance, leads to this whole collapse. Well, it's a similar deal here in that you have Evergrande very much enmeshed in the entire economy because I call them a property development group. That's the core of what they do. They do all kinds of other stuff, even with just that. Electric cars. Yeah, electric cars, which they

haven't actually built any, but they have an electric car division. They own a soccer team. They have a theme park. They've got mineral water or something. They've got their hands in all kinds of things. They've got 200,000 employees. They have 1,300 different projects in more than 280 cities across China. And another couple more aspects of this, one and a half million regular Chinese citizens have given them deposits to build houses that have not actually been built yet. So Chinese public, very upset about what's going on right now and wondering if they're ultimately going to get their home that they paid for, not to mention upset that they see those who are already homeowners, they see prices declining. So the

thing that they invested their life savings in and wanted to build wealth through, which has been a key driver of Chinese wealth creation, that seems to be not working out for them right now. So there have been protests taking over the headquarters of Evergrande. And then the last piece of this, before I play a little bit of what the BBC had to say about this, or Reuters, sorry, had to say about this, is the fact that a lot of these cities in China, especially second and third tier cities, the way that they finance their operations is through these land sales. That's how they make up the revenue that they need. Evergrande and other property development groups have been a key component of financing, of buying this land and helping to finance these cities. So again, that's why, even though one thing that's different

is Lehman Brothers didn't have like real assets. Evergrande has real assets, real property, real companies that they are trying to offload in a certain way, causing, again, prices to continue to go down. But the contagion and the potential for a sort of domino effect, because they are so intertwined with all of these development companies, with all kinds of different banks, with 280 different Chinese cities, that's why this is such a big deal right now. Let's take a listen to a little bit of what Reuters had to say about it. Pressure on property group China Evergrande has intensified.

Fears over its ability to repay investors triggered protests earlier this week and will likely rattle Beijing. The cash-strapped group, which has about $305 billion in liabilities, said on Tuesday it's engaged advisers to examine its options. It warned of default risks amid plunging property sales. Regulators and financial markets are worried that any crisis could ripple through China's banking system and potentially trigger wider social unrest. In the latest development, Evergrande said two of its subsidiaries had failed to uphold guarantee obligations for $145 million worth of wealth

management products. So you've got a lot of upset people there at Evergrande HQ. You've got, you know, China warning banks that they're not going to make their interest payments. You have this massive debt burden that is way beyond what their assets can support and certainly way beyond what their cash on hand can ultimately support. And the big question is, is the Chinese government going to come in and bail them out? Now, you may think that that's obvious. I thought it was. Yeah, it's obvious. Of course, they'll come in and bail them out. They're going to be fine. Of course, like every other big company in China, they're totally intertwined with the Chinese Communist Party. So they're going to come in and bail them out, and it's all going to be fine.

That may well be the case. But Xi Jinping has been trying to institute these reforms, and this isn't the first time where they've had to deal with the situation of companies getting way on over their skis, being way over leveraged in this insanely irresponsible way. And so they are concerned about this idea of too big to fail, this concept of moral hazard. The fact that if we bail them out, then all these other property groups, all these other gigantic corporations know that they can just wildly borrow and spend and grow, grow, grow without any concern of what the ultimate ramifications might be because we've essentially said, yeah, you are too big to fail. And so we're putting in a backstop here. Yeah. And this is the fascinating part, which is that I did not know this. Evergrande's total debt burden is the biggest for any publicly traded real estate management or development company in the world.

Huge. Okay, so the entire world, they have the largest of any publicly traded real estate company. What's even more interesting, and there's so many connections to the financial crisis, it's just so hard, is that they, despite having piled on this debt, have been paying out billions of yuan in dividends to their stockholders. The largest shareholder is, of course, their owner, Mr. We. Now, Mr. We has made $5.3 billion in dividend payments just since October of 2018. And the biggest problem is his company is, as you mentioned, those three red lines,

he is now in violation of all three. So there's a lot going on here. I think the most important part is that most Chinese financial engineering does not result in losses actually in China and to the Chinese people. Usually the people who get screwed are us or their own billionaires in terms of throwing each other in prison. There's a lot of like financial scheming or, you know, Jack Ma or whatever, like the richest people. Here, you actually have a case of their financial engineering and their kind of like crazy rapacious capitalism, which they borrowed from us, actually screwing over normal Chinese people who housing is incredibly important to the Chinese middle class. They see it as a way to actually build equity and wealth. They actually lined up outside of Evergrande 25 years ago in order to go and put down deposits on apartment buildings because they were so excited about some of these reforms that were introduced within the economy. So ownership and property is a huge part of Chinese society, of your social status and all that. Losing out on

that and having that rug pulled from under you by these kind of billionaire elites makes it now that the CCP has a real choice. Do they bail out the company and make sure that the deposits are safe for these 1 million or so Chinese? Here's the other problem. It's not just Evergrande. They happen to be the most leveraged and the most screwed. But you were telling me, and I looked into it, they have all of these interconnected deals all across of China with all these other real estate companies. And actually, if you're closely watching the Hong Kong Stock Exchange, just very recently, we saw an 87% drop in a single Shanghai-based developer on the Hong Kong exchange yesterday before trading was paused. The entire exchange is kind of in chaos as there's other real estate companies all across China, which are beginning to go in free fall. And it actually has a lot of connections to our own housing crisis in terms of when you have 30% of the economy

built up into a single sector, then you allow all of this debt in order to spiral on top of each other, which is built only on the premise that the value goes up, hence the stonks ticker, because the stonks go up. It's like, well, as long as it goes up, we're good. But oh, the moment that it goes down a little bit and some of our debt obligations comes into clear view, then it's a total disaster. It's a big, big moment for Xi Jinping because, look, the CCP, what they care most about other than making themselves rich is actual legitimacy amongst the Chinese people. And if Chinese people, a million or so, in the so-called socialism with Chinese characteristics lose their houses, that's maybe an expectation here in the United States. That's a central guarantee of the CCP. If they lose that, massive social unrest within China.

And you can see how the questions here are not clear cut. Because on the one hand, as you said, what allowed this whole scheme to continue was prices going up and up and up. Some of it artificially so. And so as long as that was continuing, basically the music didn't stop. On the other hand, prices going up and up and up means that young people who want to And so as long as that was continuing, basically the music didn't stop. three red lines and trying to reel things in and kind of take the foot off the gas pedal so that they can balance in affordability with, you know, hopefully not having housing prices fall off a cliff too much. Of course, they've also got a demographic issue, which just means that demand is not as much as it used to be. So these are thorny questions that they have to deal with right now. So look, I think still probably what is most likely to happen is they're going to suck it up and they're going to bail them out.

Most likely, yeah. That is most likely the case because the risk here is so high because you are talking about, look, you're talking about 200,000 employees. You're talking about innumerable contractors. That's reportedly some of the people who have been storming the headquarters are these contractors who are like, we're not getting paid. There are employees not getting paid. You're talking about 280 different cities that are enmeshed and intertwined with Evergrande. You're talking about all these different financial institutions. I think I saw it was like 171 domestic banks and 121 other financial firms that Evergrande owes money to that's not going to be able to make their interest payments to a lot of those banks. So it's just such a gigantic risk

and so intertwined throughout the Chinese and ultimately global economy. That's why you would still probably bet on them just saying, well, I guess it is too big to fail. And I guess we are just going to continue to have that moral hazard. But it is not a certainty whatsoever. I just saw a flash from Bloomberg. Wall Street bets on China to bail out Evergrande. So, we'll see. The Wall Street guys- Well, you know, those guys, they never get it wrong. They never get it wrong. I mean, my faith- Here's the thing. I'm just so saddened to see BlackRock and many other private equity groups who took a big position in Evergrande and put and imported so much of the Chinese system into our own markets. It used to be that our markets infected the rest of the world.

Now it seems that they are coming to infect ours. It's just the triumph of globalization. I'm just so happy for Wall Street for having to brought this to our shores. And now, you know, possibly wiping out 401k benefits for like firefighters because the Chinese can't have their real estate markets under control. Just a triumph for America. Great for us. Great for your average Chinese citizen. Just beautiful story all the way around. Thank you, everybody. 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. Speaking of beautiful stories, we've got a real mess in D.C. right now. There are effectively three different issues coming to a head all at one time. In a single month.

Right. Literally right now. Okay, so you've got the reconciliation bill that we've obviously told you a lot about. Mansions, cinema, God, all these people

creating a lot of questions about whether not, you know, I've always been of the belief like they're going to get something through. I am no longer so certain in that position because it looks like there are some real irreconcilable differences here. We're going to get to that piece more with David Serota. So that's number one. Number two, you have a looming government shutdown on September 30th if they don't pass a stopgap spending bill. So that's number two. And number three is you have a potential debt default if the debt ceiling is not lifted or suspended by mid-October. You know, they have to do these estimates of when the government's actually going to run out of money. They think it's going to be mid-October. So that's kind of the hard deadline of when the debt ceiling has to be either lifted or suspended. Republicans, while they held power, they just suspended it

so that they wouldn't have to put a hard number on like, you know, we're increasing the debt a quadrillion dollars or whatever it is, because there's all this fear politically around assigning a number to it and then getting hit with ads about what a reckless and irresponsible spender you are, even though, which you guys are all smart enough to know, the debt ceiling is arbitrary. It's sort of silly. It's all about just increasing the limit so you can pay for the things that you've already committed to spending. So this isn't about new spending or anything like that. So Republicans don't want to help Democrats out of the jam that they found themselves in. And what Democrats are effectively betting on at this point is that Republicans will be too

scared of getting assigned blame for a government shutdown to allow the government to be the ones that stand in the way of the government shutdown. So they've tied these two things together, the government shutdown, the spending bill that they have to pass to avoid that, and the debt default. So they want to pass a stopgap spending bill that includes an increase in the debt ceiling. That's the Democrats' bet right now.

Now they have another alternative. They can lift the debt ceiling on their own through reconciliation. So through the, you know, they would just need their people in the Senate, 50 votes and, you know, majority in the House. So they could do it on their own through reconciliation. But they're worried about doing that because of political considerations. Congressman John Yarmuth, my former congressman back in Louisville, who is the chair of the House Budget Committee and who is oftentimes a little bit too honest about how things actually work in Washington, which is why I enjoy him quite a lot. He explained very specifically why Democrats do not want to do this themselves to reconciliation.

Let's take a listen to what he had to say. But so I don't understand what what's their plan. What's the fallback plan if Republicans are sticking to this threat? I mean, how do you see this standoff ending? Well, ultimately, they're going to have to vote for it or we're going to have to we're going to have to have a vote and do it by ourselves. We can do it through reconciliation. Leadership has said they don't want to do that. The reason is if we do that through reconciliation, we actually have to specify a number that only leads to further chaos in a certain period of time. So what we should do is abolish the debt ceiling because we're the only country in the

world that has one that operates like this. But what we ought to do is just raise it to an extraordinarily large amount that we'll never reach. That's probably not viable politically, but we'll get to the debt ceiling raise. There is no alternative. And Mitch has said this many, many times over the last few years, that there is no alternative to raising the debt ceiling. So Congressman Yarmuth there saying effectively, yeah, I mean, that's why i do kind of like this guy he is saying what he would do is he would just lift the debt ceiling to some like absurdly ridiculous number right and then not have to worry about it again which seems like a pretty sound strategy from my perspective and i think it would be i've never actually seen negative political ads around the debt ceiling.

There seems to be this fear that, oh, they're going to use this against us. But, I mean, they're going to say you're spending too much money anyway, whether they have the absurdly large debt ceiling number or not. But effectively, that's why Democrats don't want to do this on their own because they don't want to have to put a specific number to it and give Republicans a talking point to work with. They're betting on forcing the GOP to help them with the stopgap spending measure. They're betting on the fact that if Republicans don't vote for the stopgap spending bill and the government shuts down, they can blame Republicans and Republicans won't want that. So far, Mitch McConnell is holding strong. We have a tweet McConnell saying on the Senate floor that GOP will not support legislation with the debt limit suspension included in it. So that's where we are. It's kind of a game of chicken, but one in which Democrats have an out, which is the reconciliation bill if they choose to use it. Yes, but part of the problem, and which we'll get to

with David Sirota, is if they wanted to include the debt ceiling, they would have to redraft reconciliation instructions, which would mean more votes back on the Senate floor and you'd pick it over to the House. And there's a time limit that the infrastructure bill is supposed to pass on September 27th, which is really soon. And those two things are tied together. So that's the other piece. Exactly. So timeline wise is very complicated. McConnell saying that they won't support it. Not only will they not support it, they won't support cloture, which means that they won't even allow it to come to the floor. So they're effectively trying to force them into it. I agree with you, though, on the political consequences. Look, I mean, extraordinary spending, extraordinary crisis, all of this,

saying Democrats raised the debt ceiling to like X. I just don't buy it. I don't buy that that's going to have any consequence whatsoever. We suspended the debt ceiling altogether under the Trump administration because we had to spend a historic amount of money during the coronavirus crisis. Debt politics in this way just seems so 2010. And then even back in 2010, the debt ceiling fight had nothing to do with actual debt. What was it? It was Republicans needed to show that they were standing up to Obama, that they were trying to extract concessions. They never cared about the debt and voters didn't care about the debt either. They just liked the fact that they were making life difficult for the Democrats. So that's pretty much what this entire thing is about.

I mean, shutdown politics are really complicated. Obama bet big that he would not get blamed for the Boehner and Ted Cruz shutdown. And, I mean, it was kind of 50-50. At the end of the day, Trump, I mean, complete disaster, his whole shutdown. Especially because he caved. Not only did he shut the government down for two weeks, he didn't even get anything in return. So that didn't work out. My personal theory is that while in the short term, yes, the chaos may go blame to the

Republicans. McConnell learned very well through the Obama administration. If you cause enough chaos, and especially, we always know shutdowns have an adverse impact on the economy. They have an adverse impact on service, and they make it so that the overall feeling of chaos in Washington, people very, very rarely blame the guy whose name they don't even know. Most people don't even know who Mitch McConnell is. They don't even know, you know, the arcane set procedure. They're just like, hey, what's going on under Joe Biden's presidency? So I would not bet that a shutdown, maybe in the short term, but I think in the long term, it would damage the Biden presidency, which I think is what, frankly, McConnell is going for.

We have an interesting explainer, Thad, from Catherine Rampell, which we animated here. Let's put this up there, and I'll read it for the people who are just listening, which is that the answer as to why this wasn't in reconciliation in the first place is a little bit silly. But if Congress acts through regular order, they can vote to raise the debt limit, like we were explaining, only to a specific dollar amount. In recent years, what we've explaining, only to a specific dollar amount. In recent years, what we've been doing is suspending it. That way, we don't have headlines which say that Congress raised debt to $30 trillion. So in other words, Congress really only deals with the debt

limit if, through reconciliation, their only option is to raise it to a specific dollar figure, and they're not allowed to suspend it. So Democrats afraid of what that headline is. You know, Crystal, this goes to show how wimpy they are too. There was this entire thing where the Dems were like, we're going to remind the American people that this was Trump debt too. And that's why the Republicans, I'd be like, first of all, McConnell doesn't care about looking like a hypocrite because he knows in the long run, you will suffer. And number two, I just think this entire thing is dumb. Put it in the damn reconciliation and let's all move on. You should have done that from the beginning.

I truly do not believe that most people give a rat's ass about the debt ceiling or whatever. Now, spending, inflation, that's a whole other story. But in terms of the actual debt ceiling, just no way. Yeah, I mean, they should have put it in the reconciliation bill from the beginning in the budget instructions. And I think John Yarmuth's suggestion that they just make it some silly, absurd number that you'll never, ever reach is a smart one because then you're effectively getting rid of the debt ceiling. And these politics just suck because they're so meaningless. This isn't about anything, right? It's this arbitrary thing that

no other country has. But, you know, it turns into this leverage or weapon in the arsenal of whoever wants to wield it at the time. I also think you're right about the politics of it. Number one, because, look, voters understandably basically blame the party in power when things are a mess in Washington and Democrats have control of everything. So, and look, they're not wrong to blame them. Like, Democrats had an out for this, right? Like, could have put it in their budget instructions and then you wouldn't be in this place. So, they're not totally wrong to be like, this is kind of on you guys. You had an ability to deal with this and you didn't deal with it. The other thing is that Republicans, anytime there's government dysfunction, that plays into their sort of fundamental philosophy and ideology that government can't work, government doesn't work, government's a mess.

Best thing you can do is just cut the budget, strip power from government except, you know, their power. They like to keep that part, mismanagement, etc. That is ultimately very effective politically for them. So I don't think that these politics are good for Democrats any way you cut it. They've backed themselves into a corner here, and I'm not sure exactly how they ultimately get out of it. Absolutely. Okay, let's move on to another thing. Speaking of hypocrisy, chaos, and all of that, the city of San Francisco has some of the most stringent lockdown procedure vaccine mandates in restaurants, as well as mask mandates. Now, that has been a matter of consternation for a

lot of people who live in that great city. And recently, their mayor, London Breed, was seen in a bar partying maskless, actually with a Black Lives Matter founder, but that's kind of beside the point. Now, when she was pressed on whether what she was doing was hypocritical, she delivered one of the most ridiculous defenses that we have yet seen. We put together an entire mashup of this long six and a half minute answer that you gave. Let's take a listen. While I'm eating and I'm drinking, I'm going to keep my mask off. And yes, in the end time, while we're drinking like everyone else there, we were all having a good time. And again,

all vaccinated. So the fact that this is even a story is sad. The message I want to get out is support our nightlife venues, support our restaurants. Go out and enjoy yourself. Make sure you are vaccinated because of the requirements. But don't feel as though you have to be micromanaged about mass wearing. Like we don't need the fun police to come in and try and micromanage and tell us what we should or shouldn't be doing. We know what we need to do to protect ourselves. And Dwayne Wiggins are.

But I don't know about you, but if you know who they are, I don't care where you're sitting. You're going to get up and start dancing. My drink was sitting at the table. I got up and started dancing because I was feeling the spirit and I wasn't thinking about a mask. I was thinking about having a good time. And in the process, I was following the health order. She was feeling the spirit. We can't be the fun police. Here's the thing. I agree, Madam Mayor. Here's the problem. Your constituents are not allowed to feel the spirit in the same way.

You are the fun police. You are the fun police. And just so people realize what was going on here, we have a video. So let's put this up there. I'll speak over it. There is the mayor all the way back there in this crowd of unmasked people at this bar, all in close quarters. They're having a great time, not a mask in sight. She's dancing. She's putting her hands up there. If you're just listening, I highly recommend that you go on YouTube and you just

come and watch this segment because you have to see how ridiculous it all is. And once again, here's the thing, Crystal, I support every person in San Francisco having the ability to do exactly this. There is no reason they shouldn't be allowed to, but the mayor's own guidelines say that vaccination status does not matter, that you do have to wear masks in the proximity of people indoors. So which is it? And it just happens so often. Gavin Newsom's French laundry. I mean, you know, what was it? The Austin mayor, Steve Adler, who was like, do not relax. Now is not the time for the city of Austin. Do not travel while he's in a, where was he? He was in Mexico somewhere like Cozumel or Cancun. And you could literally see the ornate hotel in the background of the video.

There was the Denver mayor who went and left the city during Thanksgiving, even though he was like, do not travel during Thanksgiving. It just happens over and over again. It's like they have one set of rules for everybody else, and then they live differently. And all many people are asking is to just simply live under the same guidelines that clearly is governing these elite structures. So I think it's important to separate a couple of things out. First of all, overall, mask mandates in businesses and even, you know, like the vaccine or test requirements that Biden put into place are really popular.

Fox News just did a poll that found, where is it, 67% support manning students and teachers wear masks, 66% say businesses should require massive employees and customers. So the issue isn't as much, like, especially in a city like San Francisco. I'm sure mask and vaccine requirements are extraordinarily popular. But what we saw with Gavin Newsom is that what people despise is the hypocrisy. And that's really, really understandable because that gets to this sense that like, oh, you think you don't have to play by the rules. You think the rest of us do, but that you're somehow exempt. Somehow, magically, the virus doesn't matter when it comes to you. think that hypocrisy is what people across the political spectrum, no matter what you think about masks and vaccine mandates and all of this, absolutely recoil from. You know, it's interesting

because she does make a very effective case here for if you have vaccine mandates, then yeah, what are you so worried about? People should be able to go and have fun and be massless and party and drink and celebrate and all of those things. Like, no big deal. And so, you know, and if you don't have the vaccine mandates, then probably the mask mandates indoors make more sense. But to have both, she makes the case, I think, quite effectively, is a little unnecessary and a little bit over the top.

So, yeah, you don't need the fun police, but you kind of are the fun police. And so if you're going to put those restrictions into place, you need to be the one first and foremost following it. I guess Mario Bowser, that was another example. Mario Bowser, Pelosi in the salon, I also forgot about. Yeah, here in our own home city that also got caught at a wedding, maskless at the table, et cetera, et cetera. And look, again, if you believe in these restrictions and you think they're necessary to keep people safe, you've got to be the one leading the charge and setting the example for everybody else. That's like the basic definition of being a leader. 100%. And, you know, it just continues to cascade.

Let's put this up there. From the Emmys, a lot of people pointed out that people at the Emmys, a lot of these celebrities were not masked. The L.A. County Department of Public Health says, look, they're not in violation because there's an exception for film, TV, and music production. And there are, quote, additional safety modifications. That's not true. There were no additional safety modifications. And to the extent that they mean that, they mean what Glenn Greenwald has consistently pointed to, the servant class on the sidelines and the people who are operating the cameras and elsewhere who are all required to wear masks while everybody's partying up at the Emmys. It's just – and look, I know we lead hypocrisy.

You can give a million stories. But it's a very ugly and terrible image. People were pointing to the same thing at the Met Gala. Take AOC's side out of it because it's not even about her. All the other rich financiers and all those people, you know, with their masked servants serving them food and elsewhere. It's just a dramatically stark vision of like restrictions apply to these people. Restrictions don't apply to these people, restrictions don't apply to everybody else. Well, and even take it down to a more sort of like day-to-day life situation, and this is something we've talked about a lot, is the way that there's a class of people who are meant to be served

and a class of people who are meant to do the serving. And if you go in a store in Virginia right now, Virginia doesn't have indoor mask mandates. And so you're very likely to see all the cashiers, all the service workers, all the people who are stocking the shelves, cleaning the floors, they're all required by their companies to wear masks. Is it because they're worried about their safety and protection? No. It's because they want to make the customers feel comfortable, the ones who are meant to be served, not to be the servers, who can feel free to able to make their own choices about what safety looks like. And those

who have to be mandated, who have to be forced, who have to be rendered essentially like invisible and anonymous by these masks, not again for the protection of themselves, but for the protection of the people who actually matter. And that is extremely gross. Yeah. You know, every time I go out to eat, it just absolutely kills me because the waiters and the chefs, you can actually, I went to a restaurant recently with an open kind of kitchen environment. These chefs are all just sweating. I mean, just covered in sweat in this hot environment.

I mean, anybody who's read like Kitchen Confidential or whatever knows just how difficult it is to even work in a kitchen in the first place. And they're all wearing masks. Every diner in the place, people are drinking, having a good time. And the waiter, you know, has to, you know, he has to like try and come really close to try and tell you because you can't hear anything. I just, you know, I find the whole thing, it's always made me uncomfortable. But, you know, especially at this level, as you point to, they don't have a choice. Everybody else, you get to sit down, you get to have a good time. And that really does stick with me. I don't think it's right.

Yeah, I agree with you. Okay, we're going to get to another pandemic story here. This one really caught my eye. And it's just really distressing in terms of the overall societal impact that our response to coronavirus has had. We've previously brought you the drug overdose numbers, the heroin numbers, suicide we took a look at, but now we have some of the numbers in on childhood obesity from a massive new study from the CDC. So let's put this up there on the screen. NPR actually covered it.

So American children, so this was a study that looked at 432,302 people between the ages of 2 and 19 years old. And they found that the percentage of obese children and teens increased to 22% compared with 19% before the pandemic. That overall increase is literally, if you extrapolate it to the general population, millions of children and teens who actually gained not just weight, but became clinically obese during the time of the pandemic. The BMI overall increase is especially distressing because the average weight gain for children is 8.8 pounds before the pandemic, overweight, to 14.6 pounds in August of 2020. That actually kicks you from moderately obese to actually clinically obese. And what do we know? Which is that one of the overall risk factors in COVID, probably the

biggest risk factor in COVID, is obesity. And we were talking before the show, this is not to shame any parent. This is not to shame anybody out there for this happening. If you are a working class parent, especially if you're single and you just got the school lunch system or whatever removed out from under you, oh, and you have to go work at the grocery store or whatever as an essential worker, or you have to struggle with COVID, unemployment. Yeah, it's going to be a tough time. It's going to be a tough situation. It's not your fault. These are major macro decisions that were made at the overall societal level. Let's throw Alec McGillis' tweet up there on the screen because he actually also shows some of the data and the movement.

The rate of body mass index increase doubled during the pandemic compared to the pre-pandemic period. So a literal doubling in the BMI increase percentage-wise for these children ages 2 and 19. And here's the thing. As anybody who's been overweight, especially me, I was overweight as a child, what do we know? Once you put it on, it's very difficult to come off. Lifestyle choice, look, I'm lucky. I have gym membership, all this, I can afford to eat healthy. A lot of people can't. A lot of people have to work two jobs or whatever. And the easiest thing in the world, whenever you're stressed in order to reach for junk food, that's literally what it is. And so you put that all together, the fact that it's cheap, the overall

societal impact, and we're going to be living with this for a really long time to come, health-wise, but society-wise too. This really changes kind of the makeup of who we are. It's really sad because, and it was also very predictable because when you think about it, like, okay, you're not going to gym class anymore. You know, you're not getting out of the house and moving around even just to walk between classes and go to gym class and have that just like daily exercise and movement built into your schedule. So that's gone. You're sitting at home. If, you know, if your parents especially are financially stressed, it's not just what's easiest and can fit most readily into a super busy life where you're just trying to keep body and soul together.

It's also what's cheapest. So that's what's there for you, whereas a little school lunch is no great shakes. Yeah, I didn't say it was great. But there's at least some requirements about nutritional value. And also it's just it's structured. So during the day, that's your only opportunity to eat. So you don't have this ability to just grab what's ever around whenever it's around. I mean, I think anybody who's shifted from like office work to working at home or had a time when they had to be at home for whatever

reason can relate to suddenly you start thinking about food all day long because you just are there and it's right there. And then you layer on top of that the stress of all of this, the stress of routines radically changing, the stress of being very fearful of a dangerous disease. All of these factors, major contributors that, again, very predictable that this would be the incredibly sad and regrettable outcome. Because like you said, especially weight that is gained in childhood and young adulthood, very, very difficult to ever overcome that. It's extremely hard. These are critical years. And so if you start off on the wrong track, it's not impossible. You proved that, certainly. Still trying to prove it. It's very difficult. I mean, you work really, really hard at it. People don't know.

You work every day really hard to maintain where you are. So it just brings me back to a monologue. I think I did this monologue while you were out, actually, about how there was this assumption that an abundance of caution came with no cost. That the only costs were if you weren't cautious enough, and there was increased viral spread, et cetera, but there were costs on the other side of being too cautious. Now, look, I think at the beginning of the pandemic, before we knew what the impact was on kids and how at risk they were, I think it was very understandable. And I can tell you, as a parent, I pulled my kids out of school even before the

school shut down because you just didn't know what the risk was. But once we did find out, there wasn't an adjustment for the fact that you're going to have weight gain, you're going to have increased addiction, you're going to have increased depression, you're going to have increased suicide. You're going to have millions of kids who just have a completely lost year of school, at least, that's going to set them back for their entire life. Because again, these are, if you're talking about kindergarten, first grade, second, these are critical years that if you lose out and you get behind, you guys know how it works, and you get tracked in a certain direction, and you're always one step behind where you should

have been. And that's the way the system comes to view you. And it's, again, very difficult to overcome. So like I said, I think at the beginning, it was really understandable that people just said, look, we got to keep these kids safe. And yeah, there are costs, but that's what we're going to do. But over time, we lost sight of the fact that if you do have this consistent abundance of caution approach, that there are costs, that they are really significant, and that they should be weighed and considered with just as much significance as the cost and the risk of the pandemic. And I just never saw that adjustment happen, and we're seeing some of the fallout, very sadly. We are not seeing that happen. If anything, there's been an escalation. We have to do

everything we have can to keep children in school. I don't even, you know, however stringent, whatever, but it has to happen. As you're pointing to, I mean, think about it too. A lot of these kids, even little kids, had to sit in front of a computer all day. You think that's healthy? Yeah. Go ask anybody who's ever worked a cubicle job whether that's good. You don't have recess. You don't have the same gym class. Many people also lost their support systems through workouts in terms of school sports. That was a very key part for many people who develop healthy habits throughout their lives.

Now that's a support system which has been completely lost. So this has been a major societal cost which is completely undercovered now, except by, you know, maybe Fox because of like lockdowns, whatever. We need to be able to talk about this without any of this culture war nonsense and just start from the very basic premise of this is a really big problem. As you said, yeah, we can forgive it, maybe, you know, in the first couple of months, five months, something like that. But after that, it was starting to become pretty clear. And there was a choice to be made. Everything is a choice. Everything has, you know, one, every action is an equal and opposite reaction. And the reaction is not having any discussion right now in the

mainstream. Yeah. I mean, I think about my own kids who have almost every privilege you can imagine, except we have really, really crappy internet at our house. See, that's a good thing. That is one thing. It is good in certain regards, but it did make virtual schooling a little bit challenging. But it was hard on my kids. I mean, my daughter, who was 12 during the year that she was out of school, she's a very extroverted person to have those social networks cut off. And also just, it was hard for her to learn outside of the classroom online. It's hard for anyone to do that. And especially if you are a certain type of learner. My son was seven. You know, again, these are really important years. He's a little boy. He's got tons of energy and he's distractible

and all of that. Like for him to sit in front of a computer all day, it was tough. And those were like the best possible circumstances. And there was definitely a toll that was paid by my kids. I can only imagine what the case was for kids whose parents are super stressed, trying to work multiple jobs, single mom, all of those situations just layer on top of that additional burdens, additional difficulties. And of course, the cost fell most heavily on the most vulnerable kids who have not only do they, of course, not have a voice in the halls of Congress, but their parents don't have a voice in the halls of Congress. So those costs have been largely ignored. Completely agree. Wow. You guys must

really like listening to our voices. Well, 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 Sagar in your daily lives. Take care, guys.

All right, Sagar, what are you looking at? Well, perhaps no public messaging campaign has defied rationality, been as idiotic, and generally been all over the map more than the public health establishment since the beginning of the pandemic. First, coronavirus, we were told, was not airborne, so we should not wear masks and we should wash our hands all the time. Then, that wasn't quite right. We had to social distance for two weeks to stop the spread. Then, actually, it is airborne, so do wear a mask. Also, the stuff is still closed. Also, surface transmission is still possible. Then, surface transmission clearly isn't possible.

Masks work. Now we have a vaccine, which does prevent hospitalization and death. But let's all be honest. It does not prevent infection at nearly the rate that many people were led to believe several months ago. I myself can obviously attest to that, having gotten COVID after being fully vaccinated. Crystal and I have also brought you the news about booster shots, how the Biden administration announced that they would be necessary for everybody. Until then, the FDA itself rejected those plans

and senior officials within the agency literally resigned out of protest. In short, it's been a real mess. Parsing what's true, what's not, has been extraordinarily difficult, which is why, after nearly 18 months of this, my position is that everything should be on the table for discussion, especially amidst the Biden administration's new mandate that all businesses who employ or more than 100 people have to either require a vaccine or regular testing and paid time off. Such a measure requires the ability to answer the questions of millions of those who are skeptical. And one of the chief ones that I've heard is this, but what if I already got COVID? Natural

immunity has been shown to be just as effective, if not more so, at defending against future infection from COVID in addition to hospitalization and death. Should that not be taken into account? Note, it is not just a crank or a pundit like me who is asking this. The very day of Biden's policy was announced, Dr. Sanjay Gupta of CNN asked Dr. Fauci if an exception should be made. Here was his answer. And just real quickly, there was a study that came out of Israel about natural immunity. And basically, the headline was that natural immunity provides a lot of protection, even better than the vaccines alone. What are people to make of that? So as we

talk about vaccine mandates, I get calls all the time. People say, I've already had COVID. I'm protected, and now the study says maybe even more protected than the vaccine alone. Should they also get the vaccine? How do you make the case to them? You know, that's a really good point, Sanjay. I don't have a really firm answer for you on that. That's something that we're going to have to discuss regarding the durability of the response. So he has got no answer. Even worse, when Fauci was pressed this weekend by Natural Immunity, by Meet the Press,

he actually admitted people who get COVID have stronger immunity and that their immunity is higher than two doses of a vaccine. But his only caveat is that the durability of immunity is unclear. But for those of us who are honest and pro-vaccine, we also know that the answer to the longevity of vaccine protection is also up in the air. Hence, all of the discussion of booster shots. This is the problem with this type of public messaging. It is clear that the public health officials want everyone to be vaccinated. Great. I agree with them 100%. The fact of the matter, though, is that natural immunity is great, but to get it,

you have to get COVID. And for a small subset of our population, getting COVID is a death sentence. Just ask the 1,500 or so people who died in the United States yesterday. Clearly, getting a vaccine, which over a billion people have gotten and provides protection from infection and insurance of zero death or minimal hospitalization in case of infection is a far better option. Yet, for those of us who are pro-vaccine, we have to listen to people and be honest about what the facts are. Marty McCary, he's a professor at Johns Hopkins Medical School, made this point in the Washington Post of all places. He writes, quote, one reason public health officials may be afraid to acknowledge the effectiveness of natural immunity is they fear it will lead to some to

choose getting an infection over vaccination. That's a legitimate concern, but we can encourage all Americans to get vaccinated while being honest about the data. He adds importantly, in my clinical experience, I found patients to be extremely forgiving with evolving data if you are honest and transparent with them. Yet, when asked the common question, I've recovered from COVID, is it absolutely essential I get vaccinated? Many public health officials have put aside the data and responded with a synchronized yes, even as studies have shown that reinfections are rare, often asymptomatic or mild when they do occur. That is very well said. If you liked it, maybe you would be compelled to share it on social media.

There's just one problem. As we have seen now repeatedly, big tech companies have taken it upon themselves to be enforcers of the public health establishment, despite their own past lies on the lab leak theory, masks, and so much more. Many users brought to my attention over the weekend that Instagram has actually taken it upon itself to ban the hashtag natural immunity on their platform. So look, as usual, this is the problem. At the beginning of the pandemic, Instagram and these platforms had a huge issue. Some people are actually saying some crazy stuff, like Bill Gates is implanting microchips into people. That stuff is easy to take down. But then it became clear that they would have to take down whatever they thought to be true, or even more dangerously, what the establishment wished to be true, not what was actually true itself. By doing that, they put us on the road to hell.

Now, some people can legitimately point to the fact that Instagram, the media, and more are actually ignoring science in the goal of getting people vaccinated. And the entire case for immunization and exit from the pandemic should instead have been scientifically based all along. And here's what's worse. Discussion of natural immunity does not in any way preclude vaccination. If anything, it actually shows us a great way out of the pandemic. If we must insist on a policy of checking people's status, you can combine the vaccinated population with those who have natural immunity would give us a better overall picture of our level of herd immunity. And if somebody really prefers getting COVID, which is a virus where you'll probably be fine, but you know, anything could happen to a vaccine that's been administered with no real problems to a billion and a half people, you know, that's on them at this point. It's time

for some actual honesty in this discussion because it's the only way out of this nightmare. And it's interesting, Crystal, you know, I was reading Dr. McCary's paper and- 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. Crystal, what are you taking a look at? Well, Democrats have decided that they are not going to really tax the rich and may even hand another tax break to the well-off. That is

obviously a stunning reversal from a party that routinely pretends to care about progressive taxation and breaking up dynastic wealth. AOC's MetGallag dress could not be reached for comment. All right, so here is the background on all of this. First of all, you guys know this. Outrageous wealth has never been at more grotesque levels. U.S. billionaires got 62% richer during the pandemic, even as normal people lost their jobs, their businesses, their savings, and more. To give you a sense, the amount of wealth billionaires gained in one single year would pay for half of the $3.5 trillion social spending that Bernie and Biden have proposed. Second of all, because this gilded age on steroids situation is so manifestly disgusting, taxing the rich is really quite politically popular. New York Times highlighted

a range of polls showing support for the idea. They emphasized in particular a Pew Research poll finding many more Americans are concerned that the rich do not pay their fair share than those who are upset about the size of their own personal tax bill. A new analysis also just came out looking at the popularity of various provisions of the Democrats' reconciliation bill and taxing rich people ranked near the top in terms of levels of support. Provisions that would require corporations actually pay taxes, increasing the capital gains rate, and upping taxes on the top 2%. They all enjoyed more than 70% support among the population. That is huge. We also know that the Democratic Party is well aware of the popularity of taxing the rich.

Top Democratic pollster John Anzalone, he was practically begging the Biden administration to lean into a message about taxing the rich. He told Axios that Biden, quote, should make raising taxes on the wealthy and corporations a standout feature of his messaging rather than a necessary evil to fund his $3 trillion-plus spending plans. So there's a massive need. It's extremely popular. Democrats know that it's extremely popular. So are they going to actually do it? Nah, don't think so. In the time it has taken to get the reconciliation bill moving and come up with hard proposals with regard to the pay-fors, lobbyists have been able to do their dirty work. They have watered down Biden's original proposals, they've erased altogether the ones that actually had real teeth, and they have simultaneously

resuscitated a tax break for the wealthy. The end result of all of this is that now we are looking at a situation where some well-off Americans would pay even less in taxes under Biden than they did under Trump. That's right, The current Democratic position flirts with a tax cut for the wealthy at a time of the most extreme inequality in history. So here is that data and analysis. As you know, Democrats want to reinstitute the SALT tax break as part of the reconciliation package, a move that Bloomberg writes would erase most of the House's tax hikes for the 1%. Here is the lead graph. High-earning taxpayers would face much's tax hikes for the 1%. Here is the lead graph. High-earning taxpayers would face much smaller tax hikes or even cuts if Democrats decide to restore the federal deduction for state and local taxes

in legislation that is now moving through the House. There is, though, a more under-the-radar change that is also extremely important and I wanted to highlight. So last week, the highly influential House Ways and Means Committee, they put out their proposal for what taxes to use to pay for Biden's reconciliation package. And effectively, the plan gives a multi-trillion dollar pass to the wealthiest Americans. The committee focused on lifting taxes on income, including a surcharge on income over $5 million. But of course, the wealthiest people, they don't actually really earn income. Instead, they either have capital gains or they engage in a strategy like Elon Musk does. That strategy is called buy, borrow, die. And it effectively allows them to skirt taxes forever.

Here's how it works. It's actually pretty straightforward. You buy an asset or in Musk's case, start a company. As that asset increases in value rather than selling it, which would trigger taxes, they borrow against it, avoiding taxes on their actual wealth for their entire lifetime. Then when they die, they can pass that asset to their heirs. Currently, a provision in the tax code called a step-up basis allows those heirs to avoid paying capital gains on any of the increase in value that happened for that asset over the lifetime of Musk or whoever it is that leaves it to them. So again, buy, borrow, die. The end result is that this strategy routinely allows massive fortunes to escape taxation forever. Now, Biden had proposed ending this massive giveaway to the wealthiest Americans,

a key driver of the sort of dynastic wealth that is so destructive to civil society and the basic notion of the American dream. But House Dems had other ideas. This was just one of the ideas for taxing wealth and closing massive tax avoidance loopholes that was stripped down in the Ways and Means Committee proposal. Now, I know this is wonky, but let me just say this really simply. If you care about inequality and having basic buy-in to our society at all, you should care about taxing wealth, and in particular, taxing massive inherited estates.

When people feel like they're stuck in whatever class they were born escape all accountability and have completely bought the government, you end up with really ugly politics and seething, unaddressed rage. That's what we've seen. These things are deadly serious. After all, nothing explains the screwed up state of our nation and our politics better than the fact that zero bankers were jailed for their crimes in 2008, and instead they just got richer than ever. One of the Democrats on the House Ways and Means Committee explained why their proposals were so timid and so milquetoast, why they'd given the billionaire class exactly the tax plan that they were hoping for. Congressman Bill Pascrell of New Jersey, who supports the SALT tax repeal, he said,

I am very suspect of a wealth tax. I think it's perceived as soak the rich. I don't think it is, but that's how it's perceived. Well, Congressman, if taxing wealth is seen by voters as soak the rich, that is all the more reason to do it. And Sager, in spite of AOC's dress, it looks like Democrats have basically... Joining us now, we have the founder of The Daily Poster, the one and only David Sirota. Great to see you, sir. Good to see you, David. Good to see you. Good to see you. To start with, we were taking a look at your most recent piece at The Daily Poster about these corporate Democrats who have just completely collapsed when it comes to drug price negotiations.

Of course, this is something that Democrats have run on for literally more than a decade. It's something that even really super annoying moderate corporate Democrats like Kyrsten Sinema ran on, promising to lower prescription drug prices. It polls at somewhere around 90 percent. Literally everyone supports it, except it seems for these obnoxious people and every Republican who also wouldn't back it. Yeah, that's exactly right. You basically nailed it, except you've got three House Democrats who voted to try to kill it. And those three House Democrats took a whole lot of money from the pharmaceutical industry and are now facing really angry constituents. The response and the justification that they're offering to their constituents is actually

quite revealing, especially Congressman Scott Peters from the San Diego area, who represents a very safe Democratic district. He was asked, he's the number one recipient of pharmaceutical money in the entire United States House of Representatives in this election cycle. And his constituents are mad that he voted this way. And they asked him why he did this. And can he please stop taking so much pharmaceutical money? And he said no, because he does not want to, quote, unilaterally disarm. And to not take the money would mean, quote, it would be like, quote, defunding my campaign, which is really revealing, isn't it? Because it really kind of says he can't even imagine running a campaign, raising money in a grassroots way for a campaign without giant money from the pharmaceutical industry. I mean, it really is a

window into how some of these lawmakers see the world and how they built their political careers. I mean, he is basically admitting he could not have the resources to run a campaign unless he raked in all of that pharmaceutical money. So David, I mean, let's switch gears entirely to the entire reconciliation bill. Let's put this up there on the screen. Sinema making some comments there about what exactly. She says that if the House delays its scheduled September 27 vote on the bipartisan infrastructure plan, or if that vote fails, she will not back the reconciliation bill. How serious are we to look at this? And if that's the case, David, doesn't this effectively mean

the entire legislation is going down? And why is she doing this? I mean, I think if you believe that she will follow through on that, then you're right. Then the entire reconciliation bill, which let's be clear that reconciliation bill is a technical term. That's the entire Democratic Party agenda, the promises that were made in the 2020 campaign. And before that, that's basically done because it is a 50-50 Senate where any one senator, if they join with the Republicans to kill the reconciliation bill, that means it's over. So this is a game of chicken. And you've got the House progressives, 16 at least, who have been on record saying we're not going to vote for the bipartisan, business-backed infrastructure bill unless it remains linked to the reconciliation bill. Now, you can ask, why would Sinema and someone like Joe Manchin threaten to kill the reconciliation bill?

Well, we have a story coming out very soon about part of the reason that may be at work with Kyrsten Sinema when it comes to prescription drug prices and the pharmaceutical industry. But more broadly, you've seen this opposition be announced by these corporate Democrats almost immediately after there was a big Washington Post story about this, almost immediately after the collective power of corporate America began lobbying aggressively, an aggressive campaign to kill the reconciliation bill. So to my mind, it goes back to when money says jump, corporate Democrats say how high. And they're willing to do that even if it means destroying

their own party's promised agenda. So the bet from progressives and also from Pelosi, who's been an unusual ally in some of this, at least to a certain extent, was that these corporate Democrats like Sinema and Manchin et al. care so much about this bipartisan infrastructure deal that they won't blow that up. And if progressives credibly threaten, as they have, to withhold their votes from that bipartisan infrastructure deal causing it to tank, that that would be real leverage, that would be real power. Do you think they miscalculated here? I mean, do you think that Manchin and Sinema and these other people, do they really care that much about this bipartisan infrastructure deal

such that that constitutes real leverage in the negotiations? I think they do. And I think that, but I would put it this way. I think they're banking on House progressives simply backing down. Because let's be honest, that's what House progressives have done forever and ever in situations like this, in standoffs like this. Now, it is my view that you could have the bipartisan infrastructure bill be voted down. You could have the reconciliation bill initially be voted down. But as I've said before, that does not preclude them bringing those bills right back up. I mean, that can happen. We've seen

that happen in the past. So I think this game, this standoff, this game of chicken may continue for a couple of iterations. And I think you're going to see that Manchin and Sinema are going to try to rely on House progressives ultimately blinking, ultimately folding. And I think Nancy Pelosi is banking on the reconciliation bill being watered down into nothing so that she can say to Manchin and Sinema, look, I basically gutted the bill you didn't want. Then she can go to the House progressives and say, hey, listen, I kept a reconciliation bill, regardless of what's in it,

just something called a reconciliation bill. I kept that linked to the infrastructure bill and we're passing that. The problem there, of course, is that if you gut the infrastructure, excuse me, the reconciliation bill, that's what actually matters. Not a bill just called a reconciliation bill, but what's actually in the reconciliation bill, that's what actually matters. Not a bill just called a reconciliation

bill, but what's actually in the reconciliation bill. And what we've reported on before is that the House progressives have not stated exactly what they want in the reconciliation bill. They've not been clear about what their deal breakers are. They've not said this, this, this must be in the reconciliation bill. They've only said they want a robust reconciliation bill. So I think that's where we're actually moving, where that idea of robust becomes the place where the negotiations really happen and, frankly, where the bad stuff will happen, where the stuff will get cut out of it that needs to be in there. Let's talk about this politically. You know, it's interesting, David. Increasingly, I am just reminded of Obamacare, which is that it started out as something where Obama seemed to have the political high ground. Then as things dragged on and people got involved, nobody could actually understand exactly what was in the bill.

And it became an overall net win for Republicans because they could attack the idea. Is that kind of what you see happening here, especially if there are middling results within the bill itself? Look, I think what the Obama, the early Obama era taught was that if you do not deliver quickly material gains to people, to regular people, that they can understand. And if you do not deliver it in a robust, a real way, that you become, as the majority party, vulnerable to attacks by Republicans. That's a basic broad stroke story of what happened in the early Obama years. And I think that's the danger here, is that if you do not pass a big enough bill with enough direct aid that the average voter can understand and can feel in their lives, then you run the risk of having it be attacked.

Not just attack, because it will be attacked, but have those attacks be effective. Have the Republicans run around saying, see, they promised you all these things and they didn't deliver. It is my view that you have to deliver to make the case that you fulfilled your promise and that you are materially improving people's lives. A gutted reconciliation bill, an infrastructure bill, and only an infrastructure bill that includes projects that we know are slowly financed, that the direct benefits take some time. I mean, the whole idea of shovel ready, oftentimes infrastructure bills take a long time to spend that money.

So if you get a gutted reconciliation bill on things that are easy to understand and only an infrastructure bill, then the Democrats are going to be left campaigning saying, hey, we delivered for you. And the Republicans are going to be saying to the public, do you even realize you don't see those benefits? Do you? Right. And it'll be a dishonest argument. But again, the point is you have to deliver in order to be able to campaign and say you have materially improved people's lives. The Obama administration early on was not really able to make that case, and they got, as Obama said, shellacked in the 2010 elections. That's the situation we may be in right now. Yeah, I think this is an important sort of like political, theoretical divide,

because I think because members of Congress are here in Washington and they're very fixated on the process and they're very fixated on like what pundits are saying on Fox News about them or whatever, they think that what people are going to judge them by is whether they liked this particular process or not and whether they gave Republicans a talking point around spending or not. What you they gave Republicans a talking point around spending or not. What you're saying is that what really matters is if voters are going to the polls and feeling like, hey, you know what? Delta variant's under control. I got a job. I feel like things are moving forward. I got a little more money in my bank account. And they don't really care

about whether it required getting rid of the filibuster or overruling the Senate parliamentarian or whatever tactics you have to use to get there, they care more about the end result. That certainly seemed to be the lesson of the Obama era. And at times, the Biden administration has seemed to have taken in that lesson. But this whole situation with deferring to the parliamentarian, not being willing to get rid of the filibuster, separating the infrastructure bill and the rest of it in this convoluted process that has dragged everything out and kept immediate relief from reaching Americans has really created a major issue for them. Because again, people don't care about process. They care about did you deliver or did you not deliver? Especially when you're the majority party, correct. I would totally

agree with you that if you're in the minority party, the process of tying something up in the process arguably helps serve your political goals. If you're the majority party, the voters want to see that you are actually delivering things, that you are, quote, getting things done. And those are going to be the questions at the end of the day. Now, look, there's going to be a lot of misinformation, a lot of campaigns are rough and tumble. There'll be a lot of stuff thrown at Democrats, even if they deliver the best possible set of bills. That's inevitable. But as the majority party, the best chance you have to actually win re-election, to be given more years in power, is to say, look at what we've actually delivered. And I agree with you that the parliamentarian,

the filibuster, all of the worshipping of norms that Democratic leaders are going out there and trying to justify in action, none of that will matter at the end of the day if they did not deliver material gains for regular people. So, David, you seem to be indicating here that you think, you know, there's this September 27th deadline for the infrastructure bill. You seem to think that both infrastructure and reconciliation may go down in the short term. And then there may be another round of haggling and negotiations where, you know, probably something sort of paltry and inadequate gets offered on the reconciliation side. A lot of pressure is brought to bear on progressives to like, listen, you guys got to go along with this and you don't want to keep, you know, bread out of the mouths of hungry children or whatever it is they use to shame progressives into compliance. That seems to be where you sort of think things are ultimately headed. Yes, that's what I think is going to happen. And I think that Pelosi and Schumer

will rely on the idea that the public doesn't really understand the difference between, let's say, a $3.5 trillion reconciliation bill and a $500 billion reconciliation bill. Of course, there is a huge amount of difference that that will mean on the idea that we just talked about of actually delivering material gains for people. But I think in the short term, people will see that we passed something called a reconciliation bill that has some climate stuff in it. It doesn't matter how much we're actually spending. It doesn't matter how much we're actually doing. We can say we passed something. Now, I think something is probably better than nothing. But again, to go

back to that fundamental principle, if you're not delivering real gains that people can feel in their lives, every dollar that you're not delivering of those real gains, you are increasing the risk to yourselves as the majority party in the upcoming elections. Yeah. Well, Pelosi's not a person who cares about the actual reality of people's lives. She cares about a talking point, which is why, as you said, for her, $3.5 trillion, $2 trillion, $1 trillion, $800 billion, whatever it is,

if she's got that talking point of, we did the thing, that's really all that she's ultimately after here. And that's where the divide between her and the progressives is going to become very clear. David, thank you as always. Guys, go and subscribe to The Daily Poster. They are constantly doing phenomenal work

highlighting and uncovering stories that no one else is paying attention to. David, thank you so much for your time this morning. Thanks, David. We'll have a link down there in the description. Thank you. Thanks to both of you. Our pleasure.

Thank you guys so much for watching. We really appreciate it. You know, we've been trying to hammer this home, but we have been very much at the mercy of the YouTube gods in terms of demonetization. They have not been kind. Largely because we've been covering this thing called the news, like 9-11, Me Too, Jeffrey Epstein. It's really interesting, Crystal, how some of the most consequential stories that we have to cover are, quote unquote, not suitable for advertisers, which makes it, what, impossible to actually do the news on YouTube. The only way, and as we've said, we literally, if it were just YouTube revenue, we'd be dead. Couldn't pay the bills in order to keep the lights on here. So link is down there in description if you can help support

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host of Rock Solid Podcast. June is Black Music Month, and Sagar.com. through that process, learn, learn from it. Check out this exclusive episode with Ja Rule on Rock Solid. Open your free iHeartRadio app, search Rock Solid, and listen now. I also want to address the Tonys. On a recent episode of Checking In with Michelle Williams, I open up about feeling snubbed by the Tony Awards. Do I? I was never mad. I was disappointed because I had high hopes.

To hear this and more on disappointment and protecting your peace, listen to Checking In with Michelle Williams from the Black Effect Podcast Network on the iHeartRadio app, Apple Podcasts, or wherever you get your podcasts. You say you'd never give in to a meltdown. Never let kids' toys take over the house,

and never fill your feed with kid photos. You'd never plan your life around their schedule, never lick your thumb to clean their face, and you'd never let them leave the house looking like, uh, less than their best. You say you'd never put a pacifier in your mouth to clean it. Never let them stay up too late. And never let them run wild through the grocery store.

We have one aisle six. And aisle three. So when you say you'd never let them get into a car without you there, no, it can happen. One in four hot car deaths happen when a kid gets into an unlocked car and can't get out. Never happens before you leave the car.

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