Morning Wire - State of the U.S. Economy & New Twitter Controversy | 9.8.22

Episode Date: September 8, 2022

The economy gets both good and bad news, a recent report details Twitter’s attempt to monetize porn on the platform, and the Biden administration’s expansion of student loan forgiveness for government workers pays out billions of dollars. Get the facts first on Morning Wire.  Learn more about your ad choices. Visit podcastchoices.com/adchoices

The Fed hikes rates, stocks rally, and the red-hot job market cools down. We have the latest on the state of the U.S. economy. I'm Georgia Howe with Daily Wire Editor-in-Chief John Bickley. It's Thursday, September 8th, and this is Morning Wire. A new report reveals that Twitter explored monetized pornography as recently as this spring. What derailed the plan, and how is the company explaining the move? And President Biden used a waiver to forgive all. all of the student loans of some government and non-profit employees,

with one teacher writing off almost half a million in loans. We take a closer look at the underreported program. Thanks for waking up with Morning Wire. Stay tuned. We have the news you need to know. While grocery store meat prices continue to rise, Good Ranchers has your back. Their inflation-proof model locks in your price the day you subscribe for the life of your subscription.

You've got to go to Good Ranchers.com slash wire and get $30 off your order plus free shipping. That's good ranchers.com slash wire. Enter promo code wire at checkout. Good Ranchers, American Meat delivered. After months of persistent inflation and stagnant wage growth, new data shows the labor market is beginning to cool off as the Federal Reserve prepares to raise interest rates even higher. Here with more on the state of the economy is Daily Wire senior editor Cabot Phillips. Cabot will get to interest rates in a sec, but first, tell us about these latest numbers and what it says about the U.S. economy.

Well, according to the Labor Department's latest report, the red-hot job market that we've seen over the last six months is finally starting to cool off as employers added around 315,000 jobs in the month of August. That's about in line with projections and still well above pre-pandemic levels, but it's down nearly 40% from the month before. So pretty significant drop-off. Another interesting note from the report, the number of 25-year-old women in the workforce spiked last month, hitting their highest levels since 2000. And while some celebrated the move as a step towards gender equality in the workforce, there were others who cautioned that it's likely the result of mothers having to leave the home to find work because of the rising cost of living. Essentially, inflation has created sort of an all-hands-on-deck mentality for families to get by.

Yeah, what about inflation? Where do you think stand there? So the latest figures show inflation at 8.5%, which is an improvement for months before, but obviously it's all relative when you're talking about record rates. And the big problem now is that wages grew just 5.2% over the last 12 months. So even if most people are getting a 5% raise over the course of a year, they're just not able to keep up with the pace of inflation. Their money is worthless. The other issue is that even if inflation does slow, much of the damage has really already been done because prices on common goods are now elevated anywhere from 10 to 15, even 20%, in some cases beyond where they were a year ago, and wages have not risen enough. So unless there's deflation, prices may stop rising, but for the most part, they won't be going down anytime soon.

How is the Fed responding to the latest economic developments? Right now, all signs point to another interest rate hike in the 0.5 to 0.75 range. As we've talked about on the show, the Fed's main goal right now is to make it actually more difficult for people and businesses to borrow money because they want to slow the economy down with the overall hope of curbing inflation. So is there any solidly good news on the economy? economic front. You're speaking my language, John. You know, I'm always trying to find reason for optimism. Well, in this case, the good news would probably be the trade deficit. The Commerce Department released their latest data on Wednesday and showed that in the month of July, the U.S. was able to

increase exports by 3 percent, and as a result, cut the trade deficit by 12.6 percent. Remember, a trade deficit occurs when a country imports more goods than it exports, and a large deficit can subtract from a country's GDP. Now, we did still see a $70 billion trade deficit. last month, which is well above pre-pendemic levels, but a step in the right direction. Now, some economists fear that the reason the deficit was cut is because there was a decrease demand for imports due to higher costs and supply chain complications and that it could actually be a sign that the global economy is heading in the wrong direction. So even the good news here could be a bit deceiving. We just don't know yet. Obviously, the economy is going to play

a huge role in the midterms. What's the latest there? Well, look, Republicans are clearly hoping the economy stays at the forefront of the national conversation because polling has consistently shown that voters trust them over Democrats when it comes to lowering inflation. For example, a number of polls in August showed them with anywhere from an eight to 12 point advantage when voters were asked which party they trusted with the economy. So unless there's a massive economic turnaround in the next two months, you can expect to hear Republicans really hammering this issue ahead of November. Yeah, it makes sense. Kabbitt, thanks for reporting. Anytime. That's Daily Wire's Senior Editor, Cabot Phillips.

Coming up, a recent report reveals Twitter's attempt to get into the porn industry. Do you like to be the first to know about trendy news and current events? If so, you've got to get the Daily Wire Plus app. Not only will you receive mobile notifications whenever something's happening, but you'll also have access to the best commentary to break it all down. Download the Daily Wire Plus app and keep up with the facts no matter where your day takes you. A recent report revealed that Twitter tried to increase its revenue base by monetizing porn on the platform. The story claims that the social media giant was looking to compete with the highly profitable pornography site, OnlyFans, but had to back away from the plan due to its failure to police child pornography.

Here to give us the details on the report and how Twitter is handling this latest round of bad news is Daily Wire Culture reporter Megan Basham. So, Megan, another day, another negative news cycle for Twitter. You are reporting that there's now a new leak, and it's claiming that Twitter explored getting into the porn business. what exactly did we learn? Well, you know, some important context here is that while Twitter makes a lot of headlines due to how many journalists and politicians tend to use it, it's not actually particularly profitable. So when it comes to revenue, so far this year, it actually comes in behind lower profile apps like LinkedIn and WhatsApp and well behind Facebook and TikTok.

Plus, its stock has really been struggling. So in order to better monetize the site, this past spring, Twitter execs, reportedly explored the idea of adopting a similar business plan to only fans. Now, this story comes from the online news outlet, The Verge. And they say they reviewed 58 pages of internal documents and spoke to a number of current and former staffers who told them that Twitter's idea was to allow adult content creators to sell subscriptions, and they would then take a healthy cut.

Now, according to the story, Twitter execs knew this was going to cost them some traditional advertisers, but their thinking was that the huge amounts of money that porn tends to generate would offset any of those losses. To that end, they put together a team of staffers called the Red Team that were supposed to research the feasibility of this OnlyFans model. And what the team reported back is that Twitter has a problem with child pornography. A direct quote from the leaked documents. Twitter cannot accurately detect child sexual exploitation and non-consensual nudity at scale. Well, even worse, according to the verge, Twitter leaders have known for over a year that this was a problem, yet they haven't really made much effort to address it. Now, how is Twitter responding to this?

Well, they aren't denying that they considered trying to monetize porn or that they formed a team to explore that option. A company spokesman told the Washington Post, it was just part of an ongoing and reflective dialogue. And she said the Red Team project led the company to decide to prioritize elsewhere. But when it comes to exploiting children, she said Twitter aggressively fights it and has invested in technology to enforce a zero tolerance policy against any kind of child abuse. Now, why is it that Twitter has had so many negative headlines in the past year compared to some of these other platforms? Just last week, you reported on another leak about potential foreign spies working at Twitter and gaining access to user data. Why does Twitter seem to have so much more internal chaos than some of these other platforms? You know, that's a very fair question. And I think part of it is that Twitter was always designed to be, say, more of a rough and tumble platform than some of these other social media companies. It allows anonymous users, for example. I sometimes joke that Twitter is Thunderdome compared to Facebook or Instagram. If you have the right kind of temperament, that's actually part of its appeal. But it also means that it tends to draw more extreme and combative forms of self-expression. People don't go there to post pictures of their family vacation.

As Elon Musk said, in many ways, it does function as the 21st century town square. It's a place where a lot of cultural and political ideas are debated and sometimes hotly debated. Now, that can be a good thing, but the downside is it doesn't make it especially attractive to advertisers who by nature want to avoid controversy. So that's led to Twitter's perpetual problem of how to make money on what it offers. And what we know so far is that neither Elon Musk nor pornography are going to perform. provide the solutions for that. All right. Well, Megan, it seems like every week you give me another reason to not be on Twitter, but thank you so much for reporting. That's what I'm here for. Thanks, Georgia. That was Daily Wire Culture reporter, Megan Basham. We've heard a lot about President

Biden's plan to forgive $10,000 in student loans for people making less than $125,000 annually. But the administration has quietly enacted a far more expansive forgiveness program for government and nonprofit employees. Here to discuss is Daily Wire investigative reporter Luke Roziak, who recently reported on this for the Daily Wire. All right, Luke, what do we need to know here? Well, we've heard a lot about the $10,000 student loan plan, but this is a whole separate initiative that's a big deal

and has really flown under the radar. The Public Service Loan Forgiveness Program, or PSLF, has been around since 2007. It forgives all student loans for government employees after 10 years of following all the rules, like making payments on time. But in October 2021, the Biden administration stopped enforcing those rules, opening it up to far more people than actually qualified. They called this change a waiver.

From its inception until then, the program only forgave a total of billion dollars. In the last 10 months alone, it's forgiven $10 billion covering 150,000 workers. Now, when most people think of a waiver, they think of a slight tweak, but this is a dramatic alteration here. Does President Biden actually have the authority to change this program so drastically? Well, this is definitely a loophole or a gray area. What expert I spoke to said a change like that

would typically require going through the rulemaking process. Now, they've proposed making these changes permanent, but that hasn't been approved yet. They are also citing coronavirus as a reason for it, but this expansion continues until next month. Even though coronavirus isn't really hindering anyone for making payments at this point. All right.

So who are we talking about here? Who's eligible for this program? Well, so it's federal, state, and local government workers, plus nonprofits, which includes activist groups like the Center for American Progress, Planned Parenthood, and wealthy entities like Yale University. But perhaps the biggest beneficiary winds up being teachers, whose union is, of course, really tight with the Biden administration. On Labor Day, the American Federation of Teachers,

that's Randy Wine Garden, took credit for forcing this expansion. It touted that one teacher used it to get out of paying $450,000 in student loans. $450,000, half a million for one person. Yeah, that's the truly remarkable thing about this program. There literally is no limit. The average debt forgiven under these waivers is $60,000. You could stay in school for years, taking on necessary classes, and as long as you work for the government for 10 years, it's so.

some point, it would go away. The Department of Education says people who qualify for the program currently have a combined $133 billion in loans. The Congressional Budget Office has pointed out the impact of this on the federal budget and suggested capping it at $55,000 per person. Is there an income limit for this program for the government workers? No, there's no limit. You can get unlimited debt forgiven no matter how much money you make. Now, one of the most frequently cited examples we have for the other program, the $10,000 in forgiveness, was that it might benefit teachers, but we now learned that there actually is another way they can get debt forgiven. Right. Public school teachers have qualified for this program in some form for a long time.

So loan forgiveness was sold as a way to help them and also to help people who are really struggling. But government workers have stable jobs. It seems like if anyone could pay their student loans reliably, it was that. And basically what this waiver now does is say that even if you didn't pay your loans on time when you were employed by the government, so you wouldn't have qualified for the PSLF under the real rules, we're just going to go ahead and forgive those loans anyway. Well, sounds like this is a lot of money we're talking about here. It is. Luke, thanks for breaking that down for us. Absolutely.

That was Daily Wire investigative reporter Luke Roziak. Other stories we're tracking this week. Russian President Vladimir Putin and Chinese President Xi Jinping, planned to meet next week in Uzbekistan. Russian officials said Wednesday. Russia resumed shelling near Ukraine's Zaporizia nuclear power plant on Wednesday, according to local officials. The day before, the UN Atomic Watchdog Agency requested a safe zone around the plant.

Cleopha Abston, the man accused of kidnapping and killing young Memphis teacher Eliza Fletcher, was arraigned in court on Wednesday on murder charges. Abston was ordered to be held without bond. In an interview on Tuesday, Hillary Clinton said she won't run for president again. Thanks for listening to Morning Wire. We created this show to bring more balance to the national conversation. If you love our show and you stand with our mission, please consider subscribing, leaving us a five-star rating,

and most importantly, sharing our podcast with a friend. That's all the time we've got this morning. Thanks for waking up with us. We'll be back tomorrow with the news you need to know.