Morning Brew Daily - Bud Light Out as Top US Beer? & How The Debt Ceiling Deal Impacts You

Episode Date: June 1, 2023

Episode 72: Neal and Toby discuss how a almost 30% drop in Bud Light sales revenue may dethrone the beer as the US's top brew. Who is hot on their heels? Plus, what is actually in the Debt Ceiling Deal and how will it impact you and the economy. Also, why the National Eating Disorder Association phased out their chatbot and which airline is weighing passengers before getting on planes. Neal shares his favorite numbers and in honor of the Scripps National Spelling Bee, Toby challenges Neal to spell some of the toughest words in the dictionary. Learn more about our sponsor, Fidelity: https://fidelity.com/stocksbytheslice Learn more about our sponsor, Brex: https://brex.com/morningbrew Listen Here: https://link.chtbl.com/MBD Watch Here: https://www.youtube.com/@MorningBrewDailyShow Learn more about your ad choices. Visit megaphone.fm/adchoices

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pwc.com slash US slash brew AI. That's pwc.com slash us slash brew AI. Good morning, Brew Daily Show. I am Neil Fryman. And I'm Toby Howell. On today's show, we will discuss the four key things you need to know about the debt ceiling deal that was passed by the house last night. And New Zealand's national airline wants to know how much you weigh before boarding a flight. Then we will dive into a story about a nonprofit that tried to replace all its workers with an AI chatbot

before finishing up by talking about the script's national spelling B finals that are taking place tonight. This section might even include a little spelling quiz from my good friend Neil over here. Hope you've been studying. Neil, it's Thursday, June 1st, let's ride. All right, I just want to give a huge shout out to everyone who listened to the podcast yesterday. We were kind of hoping that this new 7 a.m. start time would lead to a better listening experience for all of you guys. and holy moly did you guys come through welcome to all the new people we had our biggest download days ever and we actually jumped up to number two on the business podcasting charts.

Dave Ramsey, we're coming for you. I know. Gosh, maybe we should go to 6 a.m. We can take down Dave Ramsey. But yeah, big day. Thank you, Dave. Yeah, thanks to everyone who listened and welcome to all the new people. Apparently my five alarms set up generated a lot of debate and I'm genuinely curious how else you would wake up at 4 a.m.

I know. I'm a two alarm guy. Oh, two, just fewer alarms? Yeah, I just get a little nervous when I see five all in a row, so I'm a two guy. Five gives me like this calming feeling. Security. So anyway, people were talking about that. I know.

Thank you to everyone. All right, Neil, let's get into our top story. It's June 1st, which is officially the first day of Pride Month, and boy, is there a lot of controversy surrounding the LGBTQ space and how businesses align themselves with it. So to start off with, Bud Light is on the verge of losing its status as the number one beer in America. Sales ending the week of May 20th declined 26% compared to the same week in 2022. And overall, since the controversy, Bud Light has seen sales declines of 17% and 24% in April and May, respectively. So what controversy am I referring to? Well, ever since Bud Light partner with transgender influencer Dylan Mulvaney on April 1st, the brand has been the target of boycotts from its core kind of conservative leaning customers. And Neil, I remember we talked about this when it first kind of started getting steam. And, you know, we saw Kid Rock kind of shooting cases in Bud Light with a rifle.

And we didn't really give it too much time a day because we've seen these boycotts kind of gain a ton of publicity and get a bunch of airtime and then fizzle out before they can leave kind of a lasting business impact. But that doesn't seem to be the case with Bud Light. No, it feels like a broader push against woke corporations or what is considered woke corporations. But usually this Pride Month feels a little different because usually corporations are criticized by the left for doing what's known as Rainbow Capitalism. You know, they put a rainbow branding on everything. They sponsor these pride. It's like Pride Parade sponsored by Citigroup and everyone's like, okay.

But the point is they were criticized on the left for saying this is like surface level. solidarity with the LGBTQ community. But now there's been a ton of pushback on the right this year because they think corporations have sold out to, you know, what they call the woke mob. And company's response to that has been criticized by the left because they're acquiescing to conservative pushback. So now they're in this very delicate situation where they're getting hate from both sides. Yeah, rock in a hard place for sure.

I also want to take a moment to compare what is happening with Bud Light to what is happening with Chick-fil-A and Target. So both of these companies have also been kind of at this center of this conservative mailstorm that we're talking about. They've received backlash from a small set of shoppers. Actually, after receiving backlash from a small set of shoppers, Target started removing Pride-themed item from its shelves just before Pride Month kicked off. And Chick-fil-A, which is one of the more conservative- They're literally not open on Sundays. I know, leaning institutions in America and who has for years donated against LGBT.

TQ charities also started receiving backlash because they hired a VP of diversity, equity, and inclusion. So obviously, there's a lot going on in this kind of conservatives applying pressure to brands using their wallets. But I think the difference between those three companies that I just mentioned is that Bud Light is the only one seeing just a true impact of sales. I mean, Target stock price has taken a pretty substantial hit over the last few weeks. But I think it's because Bud Light just serves the most replaceable product.

Like beer, I hate to say it, but beers kind of taste relatively the same. And we're seeing this in the data because even as Bud Light sales have kind of fallen over the past weeks, Miller Light is up 20% over the same period. Coors Light is up 22% of the same period. So they're basically absorbing all those sales from Bud Light. Yeah. This whole thing started with Ronda Santis war on Disney last year, and it's only ramped up. And yeah, I think Bud Light was the main lightning rod recently.

And now what's happening to Target, Chick-fil-A, that might be a small thing. But also it's happening at Coles, which is selling some pride items. Everyone's calling like Bud Lighting. And now there's actually, we read this yesterday, which was super interesting. There's a anti-woke SPAC called Columbia. Acquisition Corp and it's an online marketplace for companies and what it calls the Patriot Economy That that company includes a section called ditch target 2.0. Yeah, I think it's very funny that First of all, SPACs are back in the news. It hasn't been it's been a minute since we talked about those, but yeah, now

I think it's more just a capitalizing on like the current I don't know topic de jure and calling it an anti-woke spec who knows how good this This company actually is, and we'll see what their financials actually are, but it's definitely making headlines right now. It feels like it's capitalizing on this particular political moment. Speaking of politics, let's move on to the debt ceiling, which the circus is on mile 25 of its marathon. So it's almost over.

Despite some detractors from longmakers yesterday, the House passed the agreement last night. That would suspend the debt ceiling through 2025. It'll head to the Senate next where it should pass, and then Biden will sign a into law and we won't have to hear about this again. Thank goodness. For a few years. There are a bunch of important measures included in this deal that are not specifically debt ceiling related. So Toby and I are just going to run through those really quickly so you know what those are. First of all, this, if you wanted to reduce the deficit by, you know, this whole thing is about reducing, you know, limiting government spending and having us not breach the debt ceiling all the time. But this is not

really going to do much to that regard. The agreement would cut spending by $1.5 trillion over the next 10 years, according to the CBO. That sounds like a lot, but it's really just a drop in the bucket. It means the federal debt, which is now 97% of GDP, will rise to around 115% of GDP in a decade instead of 119%. And that's because the largest spending areas of the government are just off limits. We're not touching those. Those are Social Security, Medicare, the military. That accounted for 77% of last year's budgets. So if you, we only put, the lawmakers only focused on cutting spending in less than 15% of the overall budget, which is called non-defense discretionary spending. Crumbs. Crumbs. Yeah. So, I mean, some people will say, you know,

many, many Democrats will say like, yeah, we're not touching Social Security or Medicare. We would never do that. But so anyone who's billing this as sort of like restraining government spending is not correct. Yeah. Okay, the next thing that you guys should know about is student loan payments are starting back up. So student loan repayments have been on hold since March of 2020, which has been costing the government roughly $5 billion a month in lost revenue. And this new debt agreement would require some 43 million Americans to resume those payments starting in September, which is slightly earlier than expected. I say slightly because the Education Secretary was ready to restart loan payments around the same time anyways.

But this is a real tough blow if you're a normal person who likes to, you know, have money in your bank account. Some economists are estimating that restarting these loan payments could result in a 40 billion reduction in disposable income for households. And I quote from a former Federal Reserve economist, these aren't trivial payments, so it cannot be good for demand. So brutal blow for people who just like spending money, basically. Well, it's going to, it was going to happen.

no matter what. But there is this Biden's plan to freeze or to cancel up to $20,000 in student debt per borrower. That is separate from this. And that is being hurt. That was heard by the Supreme Court. And they're expected to issue a ruling this month. So that'll be something really closely to watch. The next thing that we want to tell you about is this controversial 6.6 billion pipeline that is getting expedited over the concerns of environmental advocates. It's called the Mountain Valley Pipeline. And it's going to carry natural gas across. a thousand streams and wetlands from West Virginia to Virginia. How did this pass? This is seen, this is like politics at its finest. This is seen as a gift to Joe Manchin, who's the Democratic

Senator from West Virginia and who's a big supporter of the pipeline in exchange for his crucial vote last year for the Biden administration's inflation reduction act. For some liberals, this is seen as another false promise by the Biden administration to rain in emissions. He already approved, remember the Willow Oil Project last year in Alaska, which is one of the biggest oil projects on federal land ever. And this is just a little bit of politicking to get everyone on board. But environmental advocates are not happy about this pipeline. This is Biden scratching mansion back after mansion scratched his. That's exactly right.

Okay. The final thing that this deal addresses is that there's some changes to the food stamp program in the U.S. This program is known as the Supplemental Nutrition Assistance Program or Snap, not to be confused with Snapchat. So it extends the work requirement from the top age of 49 currently to 54. But actually, in a strange turn of events, because Republicans actually wanted to pull back spending here, this deal results in more people being eligible to get food stamps because there's a ton of new exemptions for veterans or people experiencing homelessness. So in total about 78,000 additional people would gain benefits per month on average rather than losing it. So just a crazy, again, that somehow we're increasing spending here on this program when a lot

of people thought that there was going to be some cuts going. Yeah. So some people say that Biden kind of steamrolled McCarthy, the House Speaker, with this deal. But again, it doesn't seem like the needle has moved much with this debt ceiling deal. It's kind of what would have happened anyway during the normal. process of the government. So I'm just glad that they're voting on it and that hopefully, hopefully we'll have more exciting things to talk about going forward.

All right, let's move on to our next story. Neil turns out that not every job is replaceable by AI and nor should they be. That's what the National Eating Disorders Association found out when it tried to replace the scores of workers and volunteers who manned its help hotline with an AI bot named Tessa. This is a juicy story already, Neil, and it gets juicier because after its workers decided to unionize in early May, NEDA executives announced that by June 1st, AKA today, it would be ending its help hotline after 20 years and using its new wellness chat bot Tessa as the main support system available on its platform going forward. Rollout did not exactly go to plan because it turns out Tesla is not great at giving advice.

It was recommending unhealthy eating habits, like cutting 1,000 calories a day to some people who were coming to it for help. And this has created a ton of backlash, obviously, because it's probably just another instance of people thrusting too much responsibility and placing too much trust in an AI chatbot where it probably shouldn't. Yeah, I mean, this thing had been in development since 2022, and we should say that it is not chat GPT related. Like this was before chat GPT, it feels more of like a. customer service bot, which sounds even worse when you're talking about crisis counseling and the fact that people were

calling in in a time of vulnerability and distress in their lives and you get a chatbot at the other end. It seems like a little bit of a mistake to just kind of apply the AI chat bot bandaid to a particularly sensitive profession that feels like

you need actual human empathy and we're realizing now from this episode that maybe robots yet cannot replace human empathy. I know. Just a big win for humans in general, but also, like, it's crazy that there's the union busting side of this, that they fired all their workers and said, you get, it is touching on all the hot button topics around AI.

And, yeah, we're seeing that you can't just replace your entire workforce with a single AI bots. We have seen that in some, in some industries. You know, IBM said it was, you know, freezing hiring and it was going to replace maybe a third of its future hires with automation. and there was an article the other day about hedge funds using chat GPT to sort of comb through documents.

So there may be particular use cases. Not AI help. Yeah, I feel like chat that, you know, when you look on some of the industries that chat GPT or AI could replace, you know, customer service is one of them. For sure. But this is nothing,

this feels like the most akin to customer service because you're asking for help from another person. But this is not, It was not effective. Yeah, a little too sensitive. All right, before we jump into the next story, we're going to take a quick break.

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terms at AKA.m.m.S. College PC. All right, Toby, New Zealand's national airline, Air New Zealand, is asking passengers to weigh not only their luggage, but also themselves when they board international flights. This is a program intended to determine the average weight of its planes before takeoff, which is something airlines need to know to fly a plane safely. Air New Zealand is complying with a requirement. from the country's airline regulator, the Civil Aviation Authority, to determine the weight of its passengers through this program.

So just to calm your concerns when you're flying back home from New Zealand, first of all, this is completely voluntary. You do not have to weigh yourself when you board this plane. And when you step on the scale, your weight won't flash before everyone, like it is with luggage, when, you know, you go over 50 pounds and you have to pay extra. It'll be sent to a secure database where it will be anonymized, according to the airline. Air New Zealand is hoping to get at least 10,000 volunteers before this program is over this month. It is a crazy headline to hear when you first read it because you're like, wait a second. They're going to make me weigh myself. And then, yeah, throughout doing research for this, we found that this is not the first time that weight and airlines have kind of been in the news.

An airline called Samoa Air in 2013 actually launched a program where they were charging people by their weight. This is not that. This is just getting... This is just getting data. But it makes sense for... Samoa Air. I mean, I'm not defending that decision, but I'm saying Samoa Air is in the Pacific Islands where smaller planes are extra sensitive to balancing weight. And so it, you know,

an extra couple, more pounds will cause it to burn a lot more fuel. So, no, weight matters in. Weight matters. Airlines, but obviously, again, another sensitive topic and you don't want to be, I already get secondhand like embarrassment when I'm weighing my bag. And I'm like, oh, I hope it's not over 50 pounds, like please, please be nice to me. So I can see why people, when they saw this headline, we're like, whoa, wait a second. Yeah, but then it's sort of like, then you dive in a little bit. You're like, oh, this is super interesting.

It actually could help out the industry in general to know, like, someone's got to do it kind of thing. Right, exactly. Experts were like, yeah, well, thank you, Air New Zealand, because now many airlines around the world are about to get some valuable information about their, their housemen. Let's get more efficient, better fuel economy. I'm all for it. All right. Neil, let's move on to.

to our Thursday segment called Neal's Numbers, where I run you through three stats that I read in the week's news. Favorite segment of the week. All right, here we go. Ready? First is, you know how as a kid you went to a beach and tried to dig a hole to China? Oh, many a time. Well, China is pulling a reverse.

It's drilling a ridiculously deep hole, 10,000 meters or almost 33,000 feet into the Earth's cross. This hole will go through 10 layers of rock and reach the literal Cretaceous era. When it hits rock, that is 145 million years old. So why dig a deep hole? Great question. President Xi Jinping wants to explore deep earth to find mineral and energy resources

and also detect tectonic disasters like earthquakes and volcanoes. Surprisingly, this won't be the deepest hole ever made by humans. In 1989, for some reason, Russia drilled a hole more than 40,000 feet deep, and it only took 20 years. This is honestly gets me excited. I don't know if it is because of the kid of me, but there's something so intoxicating about just digging as deep as you can. So let's hope they find, I don't know, something good or maybe we don't want them to find something good. They said it was going to be hard.

They said it was going to be like the construction difficulty of the drilling project. It was compared to a big truck driving on two thin steel cables. It doesn't sound easy. I know. Like five feet down, I stop and get bored. Yeah. Let's move on. Thanks to a new CDC report,

we know what is by far the leading cause of restaurant food poisoning. in the U.S., and it is sick workers making the food. 40% of all restaurant food poisoning outbreaks with a known cause between 2017 and 2019 are linked to food workers who showed up while sick or contagious. Experts said this is what happens when you don't have paid sick leave. Employees fill the need to come into work, even if they're not feeling well because they need the paycheck. The U.S. is the only wealthy country in the world without federal paid sick leave, and only 44%

of restaurant managers told the CDC in their report that they offered paid Sick leave. Yeah, I mean, I remember when the Chipotle outbreak happens. I remember when these things happen. And, I mean, it makes sense. Yeah, you don't want people who have the sniffles handling your head. No, but you need to pay them to stay home. Yeah.

Our final one pertains to this Miami Heat versus the Denver Nuggets, NBA Finals tonight. So everyone on the court is being paid very handsomely, including the Nuggets mascot. So according to a new report by the Sports Business Journal, the performer who plays the Nuggets mascot Rocky makes $625,000 per year, which is 10 times the pay of the average NBA mascot. Who is this performer and how do we learn salary negotiation tips from them? The Fox affiliate in Denver did some investigative reporting, and they think that the Rocky is played by this family of performers. It's believed that this family is related to a guy named Ken Solomon, who was rocky in

1990 and may have passed a torch to, at the very least, his son. So in my mind, we've got this soprano style shakedown happening on the front range with the Solomon mascot mafia. I think he deserves every single penny because I've seen him do like the trampoline dungs. Oh, so he's very, very athletic, like very good. He comes down from the ceiling sometimes on like cables. so I think he's underpaid. Who do you think should be the highest paid

mask on sports? Oh, man. What's the Phillies fanatic? Yeah, it's clearly the fanatic. That suit is so heavy. Yeah, I always think of like, dang, that is carrying some weight. He's also the cutest, and he's got the dances, and he's got his little ATV.

He's got a million dollars a year. I'm preaching to the choir because we've got a lot of Philly fans involved with this show. All right, Neil, thank you for those numbers, as always. I always just leave with a big smile on my face, learn so much. Let's move on to our final story. I am super pumped to finish the show with this story, or should I say, I find myself brimming with an elevated sense of enthusiasm as we approach the culmination of this performance. I said that with such pedantic rigor, because that's because the script's national spelling B finals are today. So over the past two days, a field of 231

middle and high schoolers ranging from just nine years old up to 14 years old, have a been whittled down to a field of 11 finalists. This year's winners will go home with $50,000 in the cash prize as well as the official championship trophy. Honestly, this is always such a fun time of year and especially for just kind of

nerds, I guess, like us. It's very fun to watch. I'm a geography B guy personally, but I do love watching the Spelling Bee. It's been running since 1925. So I think this is the oldest national education promotion that the U.S. has and just

keeps trucking. Love the 25th annual Sputtonham County Spelling Bee musical. Everything about, you know, educational competitions we're all for. Akiel and the B, great movie as well. But in honor of the Spelling Bee, I want to put you on the hot seat. So I went through Scripps National Spelling Bee's study list, and I snagged three words of varying difficulties. They break it down at a level one, level two, and level three. So I took one from each one. and I'm going to give you the words and see how you do. I'm going to turn, I can't use a scratch pattern. No scratch pattern.

I'm going to turn down my computer. A man of honor. Okay, your first word, fuchsia. Fuchsia. You can ask for the language of origin if you want. I know, I don't care about the language of origin. F-U-C-H-I-A. Oh my gosh, absolutely nailed it.

I gave that one to my roommate last night. I'm not kidding. It took them 23 tries to figure it out. All right. And let me be all downhill from here. Well done. Okay. Level two, connoisseur.

C-O-N- Oh, no. N-E. I'm just going to say random letters now because I'm definitely not. Cona. C-O-N-N-E-S-S-I-E-U-R. You had all the right letters, but not in the right order. It is C-O-N-N-O-I-S-E-U-R.

Okay. I was just, I'm happy that I got the two ends and the two S's. Yeah, no. You were doing well. It's the con, no. It's a C-O-N-N-O. That is a hard word to spell.

All right, level three is Whipperwill. I don't even know what that means. It is a medium-sized bird within the Nightjar family, and the language of origin is itself. It is imitive of its call. So it's Whippoorwill. Yeah, exactly. Wait, so say it again? Whipper will.

All right. W. W. It's not W. No, it's W. Okay. Well, I don't know if there's going to be an H here. I, we're going to go no H.

WIPPR. Wipper. I-R-W-H-I-R-L. Not quite. Again, you got most of the letters. W-H-I-P-O-O-R-W-I-L. So WIP-P-R-P-R-W-L. There you go.

You did really, I want to keep going. Great start. This is very fun. With fuchsia and connoisseur was close. And then Whippoorwill was, yeah, that's a level. Wipper will. Right there.

Wipper will. Tune in tonight. I said WH.I.R.L. Yeah, tune in tonight. I think it's on like a weird channel. Yeah. Probably stream it. I'll in at 8 p.m. tonight.

All right. That is our show. I am buzzing with energy after that spelling B. If you have any other words you want us to spell or any other comments or questions about the episode, definitely write in to us or say hi. at MorningBrewdaily at MorningBrew.com. Huge shout out to our crew who makes our show happen. Emily Milliron is our editor and producer.

Samantha Velas and Raymond Lue are the associate producers. Yuchinawa Ogu is our technical director. Billy Minino is on audio. Hair and makeup went to go try out to become an NBA mascot, unsurprisingly. Devin Emery is our chief content officer and our show is a production of Morning Brew. It's great show today, Neil. Let's run it back tomorrow. All.

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