Pivot - Guest Episode: Stay Tuned with Preet: College Cartels and Facebook Follies (with Scott Galloway)

Episode Date: December 31, 2021

Preet answers listener questions about Michael Cohen’s assertion that former Trump Organization CFO Allen Weisselberg is “not the key” to the Manhattan DA’s investigation. He also addresses the news that former Trump chief of staff Mark Meadows has decided to cooperate with the House Select Committee investigating the January 6th attack.  Then, Preet interviews Scott Galloway, professor of marketing at NYU’s Stern School of Business, and host of The Prof G Pod and Pivot. They talk about how the pandemic has changed the nature of work, the cartel-like behavior exhibited by elite higher ed institutions, and what to do about Facebook.  For show notes and a transcript of the episode, head to: https://cafe.com/stay-tuned/college-cartels-and-facebook-follies-with-scott-galloway/ Don’t miss the Insider Bonus, where Galloway answers a lightning round of questions. The CAFE merch store is now open! Head to cafe.com/shop for some holiday favorites.  As always, tweet your questions to @PreetBharara with hashtag #askpreet, email us at [e-mail], or call 669-247-7338 to leave a voicemail. Stay Tuned with Preet is produced by CAFE and the Vox Media Podcast Network. Executive Producer: Tamara Sepper; Senior Editorial Producer: Adam Waller; Technical Director: David Tatasciore; Editorial Producers: Sam Ozer-Staton, Noa Azulai. Learn more about your ad choices. Visit podcastchoices.com/adchoices Learn more about your ad choices. Visit podcastchoices.com/adchoices

Hey, everyone. You may notice that I am in fact not Kara Swisher or Scott Galloway. I'm Preet Bharara, and I'm the host of a podcast called Stay Tuned with Preet. On Stay Tuned, I speak with authors, lawyers, journalists, and more to break down legal topics in the news and help us all understand their impact. I also happen to be Scott and Kara's favorite colleague. all understand their impact. I also happen to be Scott and Cara's favorite colleague. I recently had Scott on Stay Tuned, and we discussed everything from how the pandemic has changed the way we work, to what we should do about Facebook, aka Meta, to his beliefs that elite universities have created a virtual caste system in this country. It was an interesting, thought-provoking conversation that I think you will all enjoy. If you like what you hear, check out Stay Tuned with Preet anywhere you listen. Scott Galloway, welcome to the show.

It's good to see you, although I'm not seeing you. So let's be honest. I'm sloppy seconds. Who canceled? Why am I here? Nobody canceled. We've wanted you for a long time. You are now my colleague at two fine institutions.

I know one. What's the second? New York University. I teach at the law school. You were a professor of marketing at the Stern School of Business. And the other is, of course, Vox Media. And we have become, you might as well tell people, we've become very close. Well, I'm glad to see you're finally investing in our relationship and more in touch with

your emotions. Can I make an opening comment about you? That depends. Go ahead. Yes. Let's talk about my favorite subject, me. Hold on. I'm reminded that we have a third institution. We both also work for CNN. Oh, that's right. You know what? I was literally taping my pilot, and they asked me for a list of people who'd be great contributors. I'm like, you know who'd be great? Preet Bharat. And they go, yeah, he's on payroll. We already got him.

We already got him. We already got him. My goal is to work for everyone you work for. There you go. There you go. That's the easiest way to look good. So there are many indicia of your self-confidence. There's a bunch of people who know you and follow you on social media.

But one in particular struck me because you go on hiatus sometimes from one of the podcasts you do with our friend and other colleague, Kara Swisher. The Pivot podcast, which is also part of the Vox Media Podcast Network. I'm going to stop doing any promotions in a moment. But you went on break for a while, and Karen needed a bunch of guest co-hosts. I served one time. And that's not a thing that I like to do. I finally did. It took me years to do that because I'm always worried that people are going to find out that the substitute is a lot better than I am. And I'm going to be like that quarterback who gets injured, who's very, very good, but not.

And then Steve Young comes off the bench. and I'm going to be like that quarterback who gets injured who's very, very good but not. And then Steve Young comes off the bench. Yeah. And all of a sudden, nobody wants Preet back. Yeah, no. How did you develop such self-confidence, sir? First off, well, thank you, I think. You know, it's more really everyone has to have a code and I'm getting very serious.

One of my codes or a huge point of inspiration for me professionally and personally is my atheism. I think there's going to be a point where I look into my kid's eyes and know our relationship is coming to an end. And so I do try and ask myself, will I regret doing this action or activity when I'm at the end? Because the end is just coming a lot faster than I anticipated. I think we're about the same age, but I just can't get over the waterfall or the speed or the velocity that time is accelerating into. And I just don't think I'm going to regret taking all of August off for the rest of my life. And I tell everyone I work for, even the CNN deal, and they kind of – they looked at me pretty aghast. I'm like, I take all of August off.

And so let me be clear. I'm still rabidly insecure. I listen to all your podcasts, and I look at the tweets to see to make sure that you're not too much more popular than me. But it's not a function of being secure. It's a function of fear of death or recognition that death is coming sooner than I like, and I want to spend August in beautiful places in Europe with my family. You know, I learned some things about you as our crack team here developed a Scott Galloway memo, and it was interesting to see, and I was sorry to hear,

you didn't have the greatest of all childhoods. I think you're trying to set me up for success, and I appreciate you saying that. It depends how you—it depends the aperture or the perspective of the lens, and I think that's one of the things you start to evaluate or register as you get older. Until the age of 40, I was very fond of virtue signaling or the humble brag of saying I was raised by a single immigrant mother. Our household income was never above $30,000 or $40,000 a year. I was a Pell Grant kid. And you think to yourself, and then based on the lens focused on where I lived in California,

I was probably, you know, I describe my household as being upper, lower, middle class. And I was worse off economically or from a family support perspective than most of my colleagues. But all you have to do is zoom the lens out a bit. And I started doing this when I hit my 40s and recognized I was born a white, male, heterosexual in 1964, which basically put me in the top one percentile of the most fortunate people in the world. Because what did that give me, Breed? It gave me access to the University of California, Los Angeles, and UC Berkeley, not only for essentially for free, but for unremarkable kids. I couldn't get in now. And that was an incredible blessing. My roommate in my fraternity my freshman year, Pat Jarvis, was born a white male homosexual. And I go on to be,

to do, you know, have what I would describe as a fairly, you know, remarkable career. I'm the first person to graduate from high school from both sides of my family, either side of my family. I got free education. I was born into the internet age. I came at professional age out of Berkeley in the nineties. We're processing power and cheap capital. We're fueling anybody, much less somebody with a shaved head and a good rap. I could raise tens of millions of dollars. So I'm here because, you know, it's kind of 50% luck, 50% timing, and the rest is talent. So all I need to do is take the lens back. And then my college freshman roommate, God reached into his soul and made one slight change, changed his sexual orientation, and he died alone of AIDS at the age of 33.

So, all you need to do, you know, in my life is just take the aperture back, take the perspective back. And it's like, well, did you grow up under hard conditions or are you the luckiest, one of the luckiest people in the world? And as I've gotten older, I recognize that, yeah, things were a little bit harder for me than a lot of my colleagues growing up. But I also wonder if that is why I'm here. I often say, I know you have kids, and I don't know if you feel the same way, but I often say I wouldn't have what I have if my kids, you know, if I'd had what my kids have.

And that is at a very young age, I registered that the connection between success, influence, and economic security and work. And I struggle with how my kids are going to make that connection. Anyways, long-winded way of saying, yeah, relative to, if you zoom in relative to my peer group at the time, I probably had it a little bit tougher. But if you zoom back to the country as a whole, much less globally, incredibly blessed. And I get all that, but it was as recently as 2019 that you talked about what the sort of the mood in the home was. You wrote, slowly our home became infected by ambivalence. And then you said this, which struck me given what I know of you and your personality now.

You write that for a variety of reasons, there was, quote, no affection, no teasing, no arguing, no discipline, no conversation, end quote. You are a person who is very affectionate. You tease, you argue, you make your living by conversation. Was that a conscious rebellion against what your house felt like when you were young, putting aside all these other issues of privilege? Hmm. I get, you know, I feel a lot of emotion just hearing you articulate those things. Yeah, I agree. My parents accomplished what I think the box you want to check as a species or, you know, as parents, and that is they were much better to me than their parents were to them. But they were European. My father,

I would describe as a fairly low character person, started his third marriage while I was married to his second wife, my mom, and just wasn't around a lot or especially engaged. He wasn't a bad person, you know, never abused me or anything like that. I think my mom was suffering from kind of what I call low-grade depression. And all I remember growing up was just sitting around the dinner table and no one saying a word. And there was just this sort of uncomfortable tension. And then my parents went through what I think a lot of families go through, and that was a pretty ugly divorce where, you know, when my dad came to pick me up every other weekend, my mom wouldn't walk me out because she didn't want to see his car.

You know, that kind of bulls**t. I was an eight-year-old. I was delivering very heated, vitriolic messages back and forth between the two of them. You know, tell your father if I don't get the child support in the next week, I'm calling the police. And my dad's saying, I'm not paying. You know, you don't do that to an eight-year-old. And it's not because they were bad people. They were just, they didn't know any different. But I'd like to think that there's a certain

amount, you know, whatever doesn't kill you makes me stronger. I decided at an older age, once I had kids, that I was going to really be affectionate. And that not only because I thought it was the right thing to do for them, I think the best thing you can do for a kid is just in explicit and implicit ways, every day tell that kid you're wonderful. That someone impressive and a good person, you know, me, dad or mom, just thinks you're wonderful. And I think over time they start believing it.

And I think that's hugely important. What about when they screw up? Yeah, so this is where I think I'm not a great dad. My partner is a disciplinarian. And what I've come to appreciate is discipline is really hard because it's much easier to say, hey, let's go to IPIC and watch the new Avengers film, even though you got a C on your test or that you've been acting out and you've been really difficult. You know, my partner runs the household like a Panzer tank division, and I've really come to respect how important that is. I'm not as good around the disciplining stuff.

I'm kind of the— Well, maybe it's okay if you compliment each other in that way. So you get to be fun dad? And is there any resentment about that? I think there's resentment that I'm just not as competent as I should be and that I don't participate as much as I should. But like everybody finds their dynamic, but circling back to affection,

I spent a lot of time thinking about coaching young men. And I would say to young men that if you don't have the confidence to be affectionate, and not only, affection is a young man. You're taught, at least my generation, you were taught that it either signaled weakness or homosexuality. And both of those things were considered bad things.

And what I would coach young men is that if you don't really embrace affection, and that is affection with your mate, affection with your parents, and especially affection with your kids and your boys. I remember this exact moment. My best friend, Lee Lotus, this Italian guy, his father looked like Burt Reynolds. His father, for me growing up, was like the image of masculinity. And when his father, Lee Sr., used to show up, he'd walk over to Lee and kiss him on the lips as an adult man.

And I thought, you know, if Burt Reynolds can kiss his son on the lips, so can I. And it was one of those moments where I thought, these guys get it. They're affectionate with each other. They love each other. They express that.

And I grew up in a household where I didn't have that. So at a very young age, I thought, as long as my kids are going to let me, I'm going to be very affectionate with them. And it's a gift from God. It's where our species, mammals, we're supposed to touch. My dogs every night do the same thing. They come lay on me because that's their natural state. I think that's our natural state. I hug my kids nonstop. Two of them are now in college. We just saw them over the Thanksgiving break and they flew back to college and we came back home to New York from the

Chicago area. And it's hard to explain for people who are in families where that doesn't happen. But I think if families hug each other all the time every day over time that makes a big difference and i think i think there are actually studies that bear this out but i think i think you're right i want to ask you one more question about one more question about your younger days and then get to something that you mentioned in passing a few minutes ago and that is so you were a young man working on Wall Street in the 80s. Do you have any observations about that time period and what that was like? So I got a job.

First off, I had no idea what investment banking was, but I thought it would impress women. So I thought— Who you also wanted to hug. Yeah, sort of. But also my roommate desperately wanted to be an investment banker and I was very competitive with him. And I thought, well, if Gary wants to be an investment banker, then I'm going to be an investment banker. I had no idea what it was,

but I interviewed well and I got a job at Morgan Stanley. And I'd heard they didn't drug test, which was one of the reasons I accepted an offer with them, which ended up being not true. But anyways, I started at Morgan Stanley in 1987. I was very fortunate to be there. It was kind of my boot camp. I didn't do very well. I got a 2.27 GPA out of UCLA. I spent the majority of my efforts trying to figure out a way to make bongs out of ordinary household items. How'd you get the Morgan Stanley job? I lied about my grades. Oh.

I lied. All right. Yeah, I'm not proud of that, but yeah, I lied. And they didn't check transcripts at the time, which is probably why I can never... This podcast is why I can't run for Senate. Anyways, but my observations, it was very male. Asshole behavior was tolerated and even encouraged, but it was a fantastic bootcamp for me.

And attention to detail, working hard. And I recognize that not because of UCLA, but because I hadn't worked as hard. I wasn't as skilled as my analyst class. And every Tuesday morning for the first year I worked there, I would go into work Tuesday at 9 a.m. And I wouldn't leave till Wednesday at 5 p.m. because I didn't have dogs or spouses waiting for me at home. I was physically fit and I wanted to signal that I kind of came to play. And that kind of behavior was really rewarded, for better or for worse. They used to give you a clean white shirt, and at the end of the year, they'd count how many white shirts you had. So it was sort of an abusive, testosterone-filled behavior or environment, which I think has changed a lot for the better.

I learned a lot about the markets. And more than anything, I learned about attention to detail because we used to have to read prospectuses frontwards and backwards. And most jobs are one of two things. They're either very interesting but a lot of pressure, or they're either kind of boring but not a ton of pressure. Investment banking is this unique combination of incredibly dry, boring material with a ton of pressure placed on it. That's why they have to pay them so much. You're not doing deals on the Concord. You're proving a prospectus. And if you get the true interest cost calculation wrong,

you're going to get fired. It's like if there's any mistake in the document, you're going to get fired as an analyst. And that was a great training for me. I think you get some of that training, I would imagine, in law school and working for the Southern District. You know, kind of everything that leaves your desk has to be pretty close to perfect.

It's actually not that different from my recollection of experiences as a junior associate at a top law firm where the young lawyer who just graduated from the great law school or had the great clerkship is not going and fighting courtroom battles. You're sitting there and it's not a prospectus, although if you're on the corporate side, maybe that's part of your job. But on the litigation side, your job is to really fly spec a brief that you're probably not even senior enough to have written or drafted. That's a mid-level associate, most likely. And you're checking every site. You're making sure that every comma,

Yeah, everything. period, hyphen, em dash, Yeah, 100%. is correct. And it's not inspiring work, but I've often said something parallel to what you just said, which is it is a training in how to be detail-oriented and in rigor. 100%.

And if you don't have that as a foundation for other things you do later, you're in trouble. It's like serving in the Marines. You're glad you did it. You came up with skills. You wouldn't want to do it again, but I absolutely needed it. And it also was a blessing in that is I knew I didn't want to do this the rest of my life. And that's a blessing. When you go into something that's a great training, the pedigree of Morgan Stanley probably got me into graduate school. It gave me an incredible kind of boot camp. And also, I was blessed to find out this absolutely is not what I want to do with my life. And that's a blessing to figure that out quickly.

It is. So it's interesting what you said earlier in the conversation about having made the decision you want to take August off. There is a lot of discussion these days about the nature of work, how people work, how much people work, where they work. I know that you and Cara talk about this all the time. This August off issue, there are people in America who make fun of the Europeans who do some version of this. Should the American workforce be clamoring for a month off every summer? So first off, I need kind of a disclaimer here, and that is a lot of this is a function of my privilege. A lot of people just can't engage in this conversation, much less have the option to do it. So I recognize that I'm privileged to be able to do this.

Well, more people would have the option to do it if their employers paid them for that month off. That's right. I think there is something to be said. You know, it all depends. I say this because my ability to take August off is because not that long ago, just 10 years ago when I started L2, an analytics company, me and my partner on Thanksgiving, every Thanksgiving for about eight years, we left for Europe Wednesday night because Thursday and Friday were opportunities to work in Europe because America was taking two days off. And that was our opportunity to lap the competition. That's how we thought. And I think you need a certain amount of that warrior attitude with a small business.

There's a Hallmark version or Hallmark Channel version of small business that, oh, yeah, everybody gets to bring their dog and has a lot of family leave. And it's never the person. It's the role. Startups are hand-to-hand combat. And I think you just have to work your ass off. I've never known anybody who got to a certain level of economic security and then had the option to take August off as I do without spending 10, 20 years plus working their ass off.

And it's just, what I call it is, there is no such thing as balance, there's only trade-offs. And you have to decide at a young age, where do you expect to be economically and in terms of influence. And if you do want to be in the top 10%, much less the top 1%, there's going to have to be kind of a multi-year stretch

where you are working very hard, very hard. And I did that. And as a function of that, I want to take advantage of some of the economic security I have and take August off. Now, the larger question around whether it should be a societal norm, I don't know. I think in America, we've decided that we believe in winners and losers. I think America becomes more like

itself every day and that it's a loving, gentle place for people with money and a rapacious, harsh place for people without money. And there's just no getting around it. The more productive you are, the more progress you can make relative to your competitive set, the more economics you can capture. So I like the idea of more people taking August off. My new company, Prop G Media, I try to actively encourage people, and it's more than just words. We shut down and we take time off. But that's because we're sort of blessed with a certain amount of credibility and economics that come from experience. And the fact that a lot of us log those decades of work, I can't imagine how hard you must have worked, Preet.

I can't imagine as an associate or as the person running the Southern District, I just can't imagine it was a lifestyle job for you. No, it wasn't. And look, one of the reasons that I was happy to be in public service was when I missed birthdays and I missed events for my kids.

And I was working Saturday and Sunday and all the time. It was not on behalf of some corporations doing some other corporation. Yeah. It was on behalf of the public. I've had this conversation with friends of mine and that's, that's why I choose to do what I do now. It's, I think it's valuable and worthwhile and it has meaning. There are a lot of people who work at jobs where they have some professional connection and professional pride in what they do. But if the work doesn't have meaning, then it's not for me. And so maybe it's the case that for lots and lots of folks who do work that isn't inspiring like that, the massive men live lives of quiet desperation. So it was said, should they get the benefit of more benefits from their company's family leave and those sorts of things?

And also an entire month off like a lot of Europe does. And another example of something that's been debated a lot recently and I wonder what you think, the four-day work week. And there are some studies that show that in certain industries there's the equivalent level of productivity with a four-day work week.

And then I want you to comment on that. And then my last question is, this issue of how people work and how hard they work and where they work, has that been disrupted temporarily, not at all, or forever by COVID? So a lot in there. So I think that the four-day work week, there's a large cohort of the American working population that doesn't live to work, they work to live. And God bless them, there's nothing wrong with that. And they want to make a good living, but they have a balanced life and the opportunity to not have to commute or spend an hour or two hours or three hours a day getting ready, putting on a suit or a pantsuit, blow-drying their hair, commuting on the Long Island transit. To offer them that Friday at

home or a flexible work week is a huge benefit, and there's a war for kind of information workers. So it's another form of compensation that companies will reluctantly but will be forced to offer. I think that's coming. And I think COVID has trained corporations how to rent human capital more efficiently, even if that human capital does not show up into a 50-story amalgam of asbestos, steel, and glass. We've just gotten better at it. We can maintain much more productivity.

And also, when you give people back two hours a day and you kind of split it with them, everybody ends up better off. And it costs about $28,000 a year for corporations to office an individual. So, if they let them work from home, everyone's kind of starting. Is that the average everywhere? That's not a New York City average, is it? No, I think it's national.

It's more expensive than you think. When you talk about security, the real estate, the insurance, a lot of times they compensate you for your transportation. It's pretty expensive, all the people to kind of get you that cubicle or get you that corner office. As a sort of macroeconomic – on a macroeconomic level, is this a good thing for corporations to embrace it? Because the other debate that's been going on – there were a couple of articles recently that I saw, this tug of war between the employees on Wall Street and the major banks, J.P. Morgan, among others. We talked about your time back in the heady 80s.

Who's going to win that battle, and who should win that battle? Well, we have a tendency, whenever we're faced with a dilemma or a problem that has a lot of different dimensions to it, we want to bifurcate it into zeros and ones because that's the easiest way to process information and get to a decision. And the conversation is usually framed around we're going all remote. They talk about companies that are all remote. And then they talk about, you know, Jamie Dimon says everybody has to be in the office five days a week back to normal. And the answer is 90% of companies will be neither. They'll be somewhere in between. Apple has said that they've requested that people be back on

average three days per week. And when you think about that, that is just a tectonic shift in work and assets. Now, what do I mean by that? If the gross destruction and demand for office space is 40% across most corporations, in other words, they're asking people or demanding that people be in the office 40% less. Because I do think there's a lot of value to being in the office, but there are just going to be certain days where you could probably get most or all of what you needed to get done at home. And people will be more tolerant and more demanding of that type of flexibility. But if 40% of the demand for commercial real estate office space goes down or gets evaporated, even if it comes back to 30 or 20 because people are going to want more space per employee for distancing

or they want it to be more inspirational for when people do show up to work, you're talking about a $6 to $12 trillion asset class, depending on how you calculate it. So what you're going to have is the dispersion or the reallocation of $2 to $3 trillion of the GDP of Germany from offices to residential. It's an enormous shift in our economy. Now, just going back to something you said really struck me. You said that you didn't mind working Saturdays and Sundays because it was meaningful work on

behalf of the state. You're much more, quite frankly, thoughtful, and you're much more of a patriot than I was as a young man. I know the moment, the moment, and there's some virtue signaling here, but I know the moment I decided I was going to work really, really hard. And up until that moment, I had been an extraordinary underachiever. And it was my second year in graduate school when my mom got very sick, and she got discharged from the hospital early. It was obviously clearly too early. She was at home. I flew home. It was just one of the worst weekends of my life trying to figure out what to do with my very, very sick mom. And I recognized at that moment, we don't have enough money. If I had money, I could take care of my mom and I can't. And I remember literally at that moment, I wasn't about serving the Commonwealth.

I wasn't about doing something meaningful. I decided at that moment, I wasn't about serving the Commonwealth. I wasn't about doing something meaningful. I decided at that moment, Preet, I was going to be rich. And it sounds gross and it sounds materialistic to say that. But at that moment, I said, whatever the f**k it takes. Just to defend your younger self for a moment, you weren't saying it because you wanted fancy baubles or, you know, a bunch of Le Creuset cooking pots, right? I wanted some of that. I wanted some of that. But it was really, it was healthcare shoved in the face of a family that was underinsured. I mean, don't you, I imagine you feel the same, I don't know what you call it, masculine, you feel these very protective notions around your mother.

And when you're the only child and you're the boy and you're 27, you're supposed to be taking care of your mom. And I wasn't, or I felt like I had failed. And that was really motivating for me, really motivating. So do you think these changes will be permanent? It sounds like you do. Yeah. That the economy is permanently changed for people who can, and not everyone can, of course, for the people who can accomplish their work from home. I mean, I guess, but let me make another comment before you answer. There seems to be a generational

shift, and this is anecdotal on my part, but I ask everybody that I hang out with, have lunch with, have interactions with outside of cafe, if they go to the office or not. And basically everyone who runs a business or is the head of their firm or is in leadership, whether it's a hedge fund or a consulting business or whatever else, for many, many months, they always tell me, I go in basically every day and i say what about the 30 people who work for you and the young people don't and and the older people i wonder if it what the psychology of that is part of it in their case is obviously it's their business they have the investment they kind of feel like you need to be with the ship you, the captain doesn't leave the ship kind of mentality. But do you think people will come around and the pendulum will swing back to eventually everyone comes back? So I'm just re-asking the same question in a third way. What's it

going to look like in five or 10 years? Oh, no, it's a structural shift. We've just gotten much better. I mean, first off, if anyone complains or talks a big game about privacy or demands that everyone's back in the office, it means they're over the age of 40, if not over the age of 50. There's just certain tells on how old you are. I can't think of a CEO under the age of 40 who's put out a mandate that everybody needs to be back in the office five days a week. Is part of that because people think that folks are screwing around

and goofing off if they can't be seen working? It's just what they're used to. Yeah. I know the CEOs of Goldman and J.P. Moore. It's just what they're used to. And to a certain extent, there are – in a situation like that when somebody says, give me the 10-year and they're on the phone with a big client about to make a trade that's very time-sensitive, you can see why it's important they're together. When they're doing deals, there is a magic and an electricity to people bumping off each other in person.

So there are certain industries where they're going to need to be back in the office, call it three days a week. I don't think, I think unless it's a kind of a time-sensitive job or you're the monitor at a nuclear power plant or something, I don't think any industry is not going to see the greatest destruction

in time in office of the human capital they rent. It's going to be, it's a structural change. And this has gone on so long that companies and people have gotten really good at it and technology has gotten really good. I mean, in the 60s, the economist Peter Drucker said that these huge office towers would be like the pyramids and that is we would come and marvel at them, but they would serve no functional purpose. And he was a little bit early, but I don't know what they're going to do with all those buildings in Midtown. When I, my, we talked about my first job, Morgan Stanley, that was 1251 Avenue in the Americas. They track for security purposes, how many people are in the building. On an average weekday pre-COVID, there was 8,500 people in the building. I was averaging 500. I

think it's over a thousand now, but it's nowhere near 8,500. And the building. I was averaging 500. I think it's over 1,000 now, but it's nowhere near 8,500. And the number of people who've returned to office, I mean, we're a year and a half into this thing, is 34%. So still two and three people are not back in the office full time. So this is a permanent structural shift. There's just no getting around it. What's interesting is to think about the second order effects. And one-order effect that I've been thinking a lot about is that one in three relationships used to begin at work. And because of horrific abuses of power— Is that a real stat? One in three relationships begin at work.

One in three in school and arguably like one in three other, including online. And what's the biggest change has been or one of the biggest changes? three other, including online. And what's the biggest change has been, or one of the biggest changes, I think a lot about how young people form households and mating, specifically mating inequality, is now two and three relationships are beginning online, which has led to this very strange thing called mating inequality. And that is similar to when Amazon put all books online or made all books available, the top 1% of books skyrocketed in value. And all the near-rare books, there were so many of them, they plummeted in value. And what you're having now, it is such a boom in online dating because people don't meet at work any longer. You have the genie coefficient or the inequality, if you will, is greater and mating now than it is in income. And

that is, if you have 50 people on Tinder or 100 people on Tinder, 50 men and 50 women, four to 10 men will get 90% of the attention, mostly based on their ability to signal that they have their shit together and someday might have resources. And that leaves 90% of the men fighting over 10% of the women. And so you're going to see, I think, a decline in marriage rates. You're going to see what I call Porsche polygamy with a top 10% in terms of attractiveness of men are having 80% of the sex and the mating opportunities. And with the scariest stat I've seen, and I think this directly goes back to people not being in the office or coming together in senses of places of physical community, what you're going to see is, or you're seeing, is that now not only is there two and three, or for every one male graduate in college, there's going to be two female graduates.

But the number of men who have not had sex before the age of 30, and people hear sex and neurons fire everywhere, but think of it as a key step to establishing a long-term relationship. In 2008, 8% of men had never had sex before the age of 30. Now, it's's 28 or 29%. So when you're walking down the avenue that is America and men and women pass by you, there's twice as many women with a college degree and one in three of those men under the age of 30 have never taken that step to an intimate relationship. And I think that's very bad for society because the most dangerous person in the world is a young, broke, and alone male. And we're producing way too many of them. is a young, broke, and alone male.

And we're producing way too many of them. We'll be right back with more of my conversation with Scott Galloway after this. You and I have talked about this, and we talked about it on the show a bunch. You have a lot of criticism for the way higher education is done. In part, how many people are permitted to get educated at universities? And you have a view of public universities and private universities. And one thing that I know you've talked about is the scaling up of enrollment. How many people should a typical public university accept and how much more than they accept now and why? That's an interesting question. So, let's set some context. 50 years ago, one in four jobs

needed a college degree. Now, it's two in three. So, the number of people, the number of jobs that demand a college degree has gone up, has doubled, if not tripled. At the same time, the number of jobs that demand a college degree has doubled, if not tripled. At the same time, the number of seats at universities has just kept pace with population growth. So it doesn't account for the fact that the number of jobs we need or the demand to college degree has skyrocketed. So at your top 200 universities, you've really seen just college seats, freshman seats, has barely keep pace with population growth. And you're seeing an explosion in applications. And some of that is a good thing. More women are applying to college, more people of color now have the confidence and the opportunity to go to college. There's some wonderful things

about this. But what you have is the kind of the emergence or the gestalt of what I call a rejectionist luxury positioning of the top 200 elite universities. The first is it's fed off of fetishization. I bet the Southern District has its colleges it likes to recruit from. I bet NYU Law, UVA, Harvard Law, and we fetishize these universities. And these universities have decided, administrators and faculty have decided, we're no longer public servants, we're Birkenbags. And once we get in, once we get citizenship, we want to militarize the border. And the deans stand up and brag that this year we turned away 92, 93, 95% of our graduates,

and everyone stands up in applause, which in my mind is tantamount to the head of a homeless shelter bragging that he or she turned away nine in 10 people that showed up last night. And what you have is this cartel that, in my opinion, and I would love your legal view on this, that the FTC and the DOJ should investigate because essentially you can't get student – you can't borrow money to go to college unless you're accredited. And the accreditation organizations, which are run by, you guessed it, the incumbents, have only let in about 150 new universities in the last 30 or 40 years, which means they have grown the total number of universities like 0.7% a year. So you have restricted supply. And then the top 200 universities have this non-economic reward out of having a luxury positioning such that they can raise their prices faster than inflation. Education costs and inflation on a just a basis have risen faster than healthcare. It's risen probably faster than any big category you can find. And we kind of get virtue points or we get a non-economic reward from feeling like we're luxury brands. And the result is prices

have skyrocketed. And then what happens is America is slowly but surely turning into a place where it's never been easier to be a billionaire, but it's never been harder to be a millionaire. And this is my kind of personal experience with this, and that is when I applied to UCLA, it had an acceptance rate of 74%, and I had to apply twice. I was struck when I saw that figure in preparing for this interview.

74%, and you know what it is now? Single digits, I'm guessing. It's 12%. So it's literally six times as hard. And people, how many times have you been in a cocktail party and people say, oh, I would never get into the school I went to? Oh, I say it. I say to cocktail parties and in my own home. But here's the thing. That means your daughter's not getting it, or it's going to be much harder for your daughter to get in. And I can prove to each of us mathematically, and you've used this stat before, that 99% of our kids are not

in the top 1%. Right. And what college has become, and it really is sort of a reflection of America, and something I think we need to check back from, is that America used to be about giving everyone a shot at being in the top 10%. If you're a good person, you work hard, a little bit of luck, in this society, you can save a million dollars for retirement. And you can afford to send your kids to school and you go on nice vacations, maybe give some money away. Now it's

about the Hunger Games. It's become a billionaire or die trying. And college has largely become among the elite schools, a place that lets in two cohorts. The first is the children of rich kids. Rich kids, if you're from a top 1% income-earning household, you're 77 times more likely to get into an elite university. A third of the top 100 schools have more kids from the top 1% income-earning households than from the bottom 60%. And then the second cohort is what I refer to affectionately as the freakishly remarkable. is what I refer to affectionately as the freakishly remarkable. Kids who by the age of 17 managed to be the captain of the lacrosse team, have patents, and then find time to dig wells in Africa.

And God bless them. But guess what? Most of us don't peak at 17. And is college about giving the unremarkable a shot at remarkable opportunities to be a good citizen, pay taxes? And for me, this is a personal story. There's just, I wouldn't be here. It's so easy to credit your grit and character when looking at your success and then blame the markets for your failures. I have no such delusions. The reason why I am here right now with Preet having this conversation is because of the generosity

and vision of California taxpayers and the regions of the University of California. And we absolutely need to go back. We need to demilitarize the border for entry into what is the American dream. And that's what's happened among elite universities. Isn't one reason for that their super-focused competitiveness? And I've made this point before when I was in the U.S. Attorney's Office. I think competition is good. Competitive spirit is good. People ordinarily think about competition as between two restaurants or two bookstores in town, private enterprises. But there's competition

among public service-oriented institutions as well. The FBI is competitive with the NYPD, whether you like it or not. And that sometimes has bad externalities. The Southern District of New York was competitive with the Eastern District of New York. We wanted to get the better cases. It's the only city in the United States of America, New York City, that has two separate federal U.S. attorney's offices in the city. We technically had jurisdiction over two boroughs. They had three. But in the field of higher education, and you have these public and private universities, both founded in the spirit of the public interest and to make good citizens and educate them so they can be employed and contribute to society, they're essentially in

the public interest. How has it gotten to the point where they're so competitive with each other that the tiny fractions of a difference in their yield with respect to who decides to go to those schools or what their SAT averages are, which they care about so much so they can notch up one point on US News and World Report. Why is it the case that these universities

care so much about that thing, which seems to me, based on what you're saying and what I've read, is driving a lot of this problem? So it's multidimensional, but the word you use is certification. You talked about U.S. News and World Report. There's nothing you can do, in my view, to set yourself up better. Everything in your life gets better. Your access to health care, your access to better jobs, your access to promotion, you're less likely to have a stroke, heart disease,

you're more likely to marry a mate that's more interesting than you. Nothing can do all of that like the certification you get from a luxury brand called a great university. And we talk about Apple and Google and Amazon as being the best brands in the world. Bullshit.

The best brands in the world, hands down, are MIT, Stanford, and Harvard. No one pays Apple $100 million to put their name on the side of a building on the Apple campus. The strongest brands in the world, hands down, are American elite universities. So the certification there is so incredibly powerful. And then as academics and as tenured faculty

and as leadership, we've discovered this incredible business model, and that is reduce the number of admittees such that you can go up in U.S. News World Report who has instituted this very damaging metric called admittance rate. And the lower your admittance rate, the higher you go in the rankings. Kids have very little actual experience with the university, so they base everything off certification. very little actual experience with the university, so they base everything off certification. So, your ability to say, I'm a graduate at Dartmouth makes you a more attractive person for the rest of your life. And how attractive that brand is, is based on the rejectionist culture it's able to promote. And then it works out being a fantastic business model, because when we enter into this cartel of rejectionism such that we can raise prices faster than inflation, which we've done for the last 40 years. There's never been an assault on prosperity of the middle class like

higher ed in the U.S. If you think about runaway inflation, what it does is it decreases purchasing power and prosperity of people whose wages don't keep pace with price increases. There has been no sector in America that has experienced the type of inflation without the commensurate increase in wages as higher education. And most of that decrease in prosperity has been borne by middle-class households who've had to transfer $1.5 trillion in student debt, transfer that kind of wealth from middle-class households to the endowments and salaries and bloat of these universities. And it's an amazing business model. In the midst of a pandemic, when we're at NYU essentially charging people $60,000 a year

for what is a more boring version of Netflix where they have to dial in eight times a week and watch a professor who brightens up the Zoom by leaving it teach, and they don't get the campus experience, don't get the electricity, don't get the better teaching of an on-campus experience, and yet we decide to raise tuition 3%. Why? Because we can. Because guess what, Preet? Everybody in lockstep among

the top universities just happens to raise their tuition the exact same amount. And by promoting these luxury brands that are fed in by these rankings, and then by restricting the number of freshmen seats, if you stacked the endowment of Harvard in $100 bills, the Virgin Galactic Orbital One would barely clear it. It has the GDP of Costa Rica in its endowment and it's reduced the number of students it admits. Stanford has exploded their endowment. They have tripled the number of applicants they did 20 or 30 years ago

and they haven't increased their freshman seats because it is great once you're in to pull up the bridge behind you. And the result has been an economic model. Everything we do at elite universities really answers one question. How do I, a faculty member administrator, increase my compensation and decrease my accountability? And occasionally, we do kind of civic things and let in these really remarkable kids from the inner city to smudge or smear Vaseline over the lens of

the corruption that higher ed has become. We have morphed from being the greatest upper lubricant in mobility in the history of capitalism to the enforcer of the caste system. You want a caste system, don't go to Europe. Come to U.S. higher ed. We cement people's wealth. We help them build dynasties. And we let in a few remarkable kids to kind of make ourselves feel better. And then we let in international kids and call it diversity, which is bullshit. We let them in because they check a box. They pay full fare. 100%. Easiest way to get into Dartmouth is to check that little box that says, I will never seek financial aid. And that's what a lot of the foreign students.

Now, it changes at the PhD program where we bring in this incredible secret sauce that is one of the biggest advantages in America. And that is we bring in remarkable graduate students from all over the world. And the fact that we would do anything to decrease that supply is tantamount to the Tampa Bay Buccaneers getting every top player in the world and saying, no, we don't want to do that. It makes absolutely no sense. But we have figured out this ultimate cartel and luxury positioning that feels good for everybody, raises prices for everybody, except it soaks the middle class. and the middle class is no longer in love with the unremarkables. And it's just, what do we want America to be? Do we want it to be optimized to find the top 1%,

household kids from households, top 1%, and remarkable kids and turn them into billionaires? Or do we want to give unremarkable kids a chance to have remarkable futures? And I think it's absolutely got to be the latter. So let's do a thought experiment quickly. Yep. The school that I know best is my alma mater.

Harvard has about 1,600 kids in every class. A little different this year because of the pandemic, but ordinarily for many, many decades, it's been about 1,600 kids. You become the president of the university, and let's say you have unfettered power to change very basic things. The real president probably doesn't, but let's say you do.

And you decide, tell me if this is something that you might do in your first 100 days in office as the president of Harvard University. Increase by 50% the number of students who come in as freshmen every year. So you go from 1,600 to 2,400. Would you do that, A? And B, or more, what would be the consequence, positive and negative? Yeah, so I think any university that isn't growing its freshman seats faster than population should lose its nonprofit status. They're no longer a public servant. They're a hedge fund educating the children of their donors and some remarkable kids, just to gloss over that fact. children of their donors, and some remarkable kids, just to gloss over that fact. So if I were the president of Harvard and have a magic wand, I'd say, all right, we need to, this is a transformative

process, what we have here. The education, the certification, the networking is transformative in people's lives. And why wouldn't we take this unbelievable product and, you know, to redistribute the elites, but still maintain the elitism is still a form of bigotry. Bigotry is your exclusion or discrimination against a specific group. And I believe that elite universities have become bigoted against unremarkable kids. And that is, well, why are you there? If you have a GDP, so what would we do? Immediately commit to doubling enrollment every, call it, I don't know,

six or seven years for the next two or three decades. And by the way, the University of California has just announced they're going to increase their freshman seats by 20,000 students or the size of a U.S. campus in the next 10 years because they haven't lost the script. And they also realize economically there are a lot of corporations that are just so hungry for people with these skills and they can't find them. So you do that at Harvard.

Yep. Do you do that on the premise that the other elite schools will follow suit because you're a first mover? And if they don't follow suit, what happens to the US News and World Report rating? What happens to applicants? What happens to faculty? What do you think happens? So I think there's a lot of scare tactics that are total bulls**t. The first is that our brand, the reason why our brand is so strong is because we're so exclusive. When UCLA was letting in 74% of its applicants, it wasn't like it was this sh**ty Winnebago Joey bag of donuts brand. So, you know, I mean, maybe it wasn't the elite university and maybe it didn't feel like the Ritz-Carlton Brentwood, which it feels like now, but it was still a really strong brand. It

was a strong enough brand for me to get a job at Morgan Stanley, which was considered kind of the premier job in the nation at the time. It was a strong enough brand for me to get into a great graduate school. So the notion that if we raised our, so Harvard gets 55,000 applicants to let in those 1,400 students. If they raised it to 14,000, that would still just be a drop in the bucket. That would still be an incredible, it's as if we have this life-saving gene therapy and we decided, yeah, we're only going to give it to 1,400 people. So yeah. And by the way, I think just to elaborate on the point you just made, Harvard by its own admission says and broadcasts,

and this is how they explain diversity such as it is there, they could fill every single seat in the freshman class with someone who has, you know, people who are straight-A students with 1600s on their SATs, and there would be many people left over. So to expand the class wouldn't, as some might imagine, be to lower the quality or even the testing credentials of the kids who were coming in, right? Well, if you even care about that. And I know that's not the focus here. But specifically, the head of admissions at Harvard said we could have doubled. He said this, I I think 10 years ago, we could have doubled our freshman class without sacrificing any quality. And then the question becomes, well, if you're sitting on $45 billion endowment,

why wouldn't you? And they will claim, here's another myth, that they're space constrained. That's what Stanford says. We're space constrained. And here's what we need from our faculty. You need to take 50% of your courses or move towards 50% of your sessions being online. And the dirty secret, and I say this as someone who loves teaching in person, the dirty secret of higher ed is that we could easily take 50% of our courses, make them synchronous, they're still live, but they're online. And for the ones where there's not a lot of interaction, which there isn't they're still live, but they're online. And for the ones where there's not a lot of interaction, which there isn't a lot of sessions, do it online.

And overnight, you essentially double the capacity or the supply of that university. And for example, at UCLA and at Berkeley, and I've met with both chancellors recently, we're not doing a lot with our campus during the summer months. We aren't offering hybrid of classes because in order to support the incredible prices, especially elite universities, we want them on campus and we don't want to be teaching hybrid because we don't want to be compared

to a lot of the startups, the online startups. We can massively increase supply. We need a grand bargain, not with the Ivy League because let's not talk about Harvard. I've written off. They're doubling down on exclusivity. That's what they want to do.

It's the public universities. Two-thirds of our kids end up at our great public universities. That's where we're going to move the needle for America, Preet. And I think we need a grand bargain. And it goes something like this. We go to the state legislatures and say, look, we need you to step up and increase funding by 50% over the next 10 years. But what we are going to do as faculty is we're going to commit to and embrace a big and small tech, and we're going to increase our enrollments by 100% at Ohio State, University of Texas, University of North Carolina, Cal State. There's just some amazing, the Gophers, the Badgers, there's some amazing public schools that have the scale, the capacity, the brands, and I think the inclination. I still think there's a lot of leadership there that hasn't lost the script,

that sees their role. The University of Illinois, University of Georgia, these are amazing platforms. And we're going to use small and big tech to, I don't think you can decrease costs. I think what you could realistically do is increase productivity and increase or decrease the cost per student. But UCLA should go from 6,000, I think it is, freshmen to 12 in the next 10 years with a mix of big and small tech and also ask our state legislatures to step up. Now, that takes on a second-order effect, and this is a more politically sensitive topic. And that is I think we have shot ourselves in the foot at public universities because the state funding – federal funding has gone up, but state funding has largely stayed static. And I

think a lot of that is that because typically speaking, 50% of state legislatures are Republican. And education, funding education used to be kind of a bipartisan priority. And now I think a lot of people, a lot of our colleagues on the Republican side of the aisle and state legislatures see these universities as moving almost towards promoting an orthodoxy that is counter to their beliefs. And so they're less inclined to be generous and think about how they increase funding to our great public universities. So I think that we've shot ourselves in the foot and have become places where honest and open debate isn't encouraged. There's a certain orthodoxy that is promoted that is, I think, unhealthy in terms of the notion that a campus used to be a

place you'd place outside the city so you could think provocative things and have provocative arguments from both sides of any argument. I think we've lost some of that credibility. I think it's hurt us long-term in terms of funding. But I think there needs to be a grand bargain between citizens, alumni, administrators, and faculty to say, we need to dramatically expand the University of Michigan. We need to dramatically expand University of North Carolina Chapel Hill. I mean, for example, we've got Tide Pods. We've got a Porsche SUV. Every great company has innovated. We've got Google Owns Waze. We've got amazing innovation and different packaging, different technology. What would happen

if Berkeley or MIT did a two-year course in cybersecurity for high school grads and said, all right, you don't want a traditional four-year degree.

We're going to charge you $30,000 or $40,000. You're going to go 19 months straight. You're good at math. You don't want a traditional BA, but we're going to come up with different types

of unbundled micro-certifications. What would the demand be in the workforce for that? But we don't want to do that. What's interesting is we don't have that, and people might find this controversial, but we do have schools of journalism, about which there has been a lot of debate, because you can become a journalist without going to journalism school. Journalists don't make a lot of money, but journalism schools charge a lot in tuition. Or social science or social work.

Yeah, look, the universities have been some of the most non-innovative places in whatever you want to call this, in industry. I've been teaching 21 years. If you went into my class 21 years ago, the content's a little different, but the technology, the format, the only thing that's changed is tuition is up 150%. And think about any product that you charge $60,000. You can't even think of it.

Think of any expensive product and think about what it was 20 years ago. Think about the car that was produced 20 years ago. Think about your phone 20 years ago. Think about the way you consume media 20 years ago. Think about your phone 20 years ago. Think about the way you consumed media 20 years ago. Even healthcare, if you went in for a kidney transplant now versus 20 years ago, I would imagine the procedure, the pharmaceuticals, the rehab is dramatically different. Not a lot. The only thing that's really changed at our universities is the debt that we're placing on young people. And that means something is wrong because this isn't, and when you look at it, it's obvious why it's happened. We've

entered a cartel, which is really advantageous for the institutions, for the endowment, and for the tenured faculty and the administrators. For everybody else, for America, I think it's been a bad thing. So I expected to get to this far earlier, so we don't have a lot of time. But I do want to get your thoughts with respect to another institution that was actually founded on a college campus, one that we were talking about earlier. Give us, in a nutshell, your biggest concerns and problems with that thing called Facebook. and problems with that thing called Facebook? Oh, look, we have an organization that influences people and serves them their content to a population that's greater

than the Southern Hemisphere plus India. And it's run by an individual who can't be voted out of office, so probably with us for 50 years, who started his professional life with a site evaluating women on their physical appearance, screwed over his best friend in school, then f***ed over other friends outside of school, does not appear to have really any sense for the damage around our elections, teen health, how coarse our discourse has become. I think Mark Zuckerberg, I said this

five years ago and everyone thought I was crazy. I think Mark Zuckerberg is the most dangerous person in the world. Biology is going to take care of Putin. Democracy took care of Trump. What gets Mark Zuckerberg, who may be a well-meaning person but just doesn't have the life experience and maturity or the perspective to be responsible for the algorithms that decide the content and kind of the decisions that a third of the world's population makes. So, and in addition, our idolatry of innovators, the fact that we now have more lobbyists who work for Amazon in Washington than we have sitting U.S. senators, the fact that there are now 1,700 people working in PR and communications for Facebook and 1,100 people in the newsroom of The Washington Post, we've been overrun. We fetishize these individuals. Only 8% of our elected individuals have a background in

engineering or technology. We don't know how to regulate them. We're overrun. And these platforms are there to make money, and they do that. That's their job. So in addition to being the most dangerous person in the world, I just don't think we're doing our job. I think we're supposed to elect talented, thoughtful people with backbone who will regulate these companies and hold them to the same standards we've held everyone else. And I want to just wrap up with saying I think big tech is a net good for the world. I'm not an anti-tech person. I own their stocks. Amazon's the largest recruiter out of my class.

The problem is with the word net, and that is fossil fuels I believe we're a net gainer from, but we still have emission standards. We're net gainers from pesticides, but we still have an FDA. There's no regulatory body. There's no algebra of deterrence. When they weaponize our elections, when they depress our teens, when they violate our privacy, we issue a fine that is the equivalent of a $50 parking ticket on a meter that costs $100 every 15 minutes. The incentive is to break the law. So now let's pretend you have a magic wand again. Yep.

Not as the president of the university, but as, you know, social media czar of the universe. Yep. Regulate Facebook slash break it up or abolish it. Oh, you don't want to abolish it. They create tremendous ecosystems. They create tremendous economic value. There's a lot of very positive things about social media. What I think we do is what we've done with every other industry. I think, one, antitrust. We return to our proud legacy of breaking companies up, which is accretive for shareholders, good for job growth, good for venture capital, good for the tax base, good for the planet. The only person or stakeholder that loses in a breakup is the CEO who wants to sit on the iron throne of all seven realms, just not Westeros. And unfortunately, with dual-class shareholder structures, that non-breakup happens for way too long. Two, we regulate them. Any trust, then regulation.

But also, Preet, and I'm curious to get your thoughts on this, I don't think any of this stops until there's a perp walk. Because let me give you an example. You're always saying this to me. But let me give you the example. Let me set this up. Yes. You think people should go to prison.

What should Mark Zuckerberg go to prison for? Well, let me just set it up first. If somebody calls you and says, Preet, so your kids are already in college. But if they called you a few years ago and said you had a good kid, good kid but not a great kid. But in your eyes, they're great. They just need a little help. And says, Preet, I can get you into Stanford. I'm the sailing coach. We have scholar athletes. By the way, if you make a hundred or $500,000 donation, I can streamline this. I actually empathize with the parents who did that. But then Aunt Becky did a perp walk and you're hanging up the phone now. What is their incentive not to continue to break the law

when the penalties are just 11 weeks of cash flow? So you asked me, what is the algebra deterrence? What is the perp walk? I think it's cartel pricing that case in Texas. I think they have lied to conference. I think there might be disclosures to the SEC that are mandated that they did not make about the performance of their business

and what the research was showing. But I would put it to you, does any of this change without a perp walk of someone in big tech? And then I'd put the question back to you, what if any laws had been broken? And have none been broken? Yeah, I don't know. Well, the evidence we have that no criminal law has been broken, and this is not proof positive, that there have been no criminal cases brought. And there are a lot of very aggressive prosecutors in the Justice Department and at various other places and attorneys general's offices. I think there are probably civil sanctions,

and we're seeing, as you have said, a step up in antitrust enforcement, which often happens when a Democratic administration comes in. So we'll see. It is true that if you charge someone with a crime and you succeed in convicting them of the crime, then there's a deterrent effect. The mere arrest of someone based on scant evidence and a dubious claim of the violation of a criminal statute, if that person gets acquitted swiftly or the case gets dismissed swiftly, does not work a deterrent effect.

You're worse off. You're worse off. Yeah. And so, you know, prosecutors don't think about, you think in tandem about what is the crime that was committed and what will that, and what will the deterrent effect be of enforcement of, of those statutes. But you don't think in a vacuum, you know, people are sort of generally bad and generally doing bad things. Someone should go to jail. That's putting it backwards. And it's often the case, as was true with the financial crisis. There's a lot of people who act in bad faith, whose impact on society is negative.

And it's not necessarily the case that there's a, you know, federal or state criminal statute, as opposed to regulation, but a state or federal criminal statute that has, A, been violated, B, you can prove beyond a reasonable doubt, and C, that you can get a unanimous jury to agree upon. It's not so easy. So distinct of the law, let me ask you another question, or not distinct of the law, based on your background as a prosecutor and your law background. So two-thirds of extremist sites that men join on YouTube, the site or the page has been suggested to them by the algorithm. They didn't find it. It was suggested to them. Since 2012, since social has gone onto mobile, specifically Instagram, we've seen an explosion in hospital and emergency room admittance, not self-reporting, but actual admittance from teenage girls with self-harm.

It's actually much more prevalent for teenage girls than it is for teenage boys. Boys bully physically and verbally. Girls bully relationally, and we put these neutron bombs in their hand. It looks as if the insurrection, or at least a component of it, was organized on Facebook and that they turned a blind eye to a lot of this. on Facebook, and that they turned a blind eye to a lot of this. Aren't there millions of people in prison who've done far less damage to the Commonwealth and each other than some of these executives at big tech? Yeah. No, that's true. And you're pointing out a gap in law whereby lots of people can get away with a lot of things. Like you saw that, again, in the financial crisis. Yeah. People of bad faith sold bad junk that they were putting across

as might've been valuable. But then we talked about prospectuses or prospecti, if that's the plural, that you were fly specking back in your days at Morgan Stanley. And smart lawyers and smart accountants know what the limits of the law are and know what caveats to put into footnote 461 very deep down in the prospectus just to give one example of how they can avoid criminal liability and the question is what was known what was not known and what the particular laws are and look there are huge gaps in society with respect to what the legal regime criminalizes and what it doesn't there's probably a lot of things that shouldn't be criminalized and more things that should be. But I think, look, I think the revelations of the whistleblower in recent times

about Facebook and the thing that you're talking about specifically, which has not been known really until recently. I mean, some of these bad things you're talking about are just things that sort of buyer beware. But if it's the case, like with Philip Morris and that analogy you have made and others have made, if it's the case that there were executives who knew the harms that were being caused, went ahead anyway, made misrepresentations about the harms, whether it's in connection with securities offerings or otherwise, yeah, then we're getting closer to what you're talking about. Do you think it's going to happen? I don't know. I don't make predictions about that. But I think that the likelihood grows as more and more people feel comfortable coming forward with information. And more and more politicians on both sides of the aisle are talking about legislation. to the political spectrum for different reasons, and you have more aggressive prosecutors around,

I still think at the end of the day, the most likely thing that happens in these circumstances is civil enforcement. And even that's not nothing. I mean, I guess my question for you, and then we have to come to an end shortly. What about the reaction to Facebook itself? You have a company that is facing these threats, maybe not existential threats, from regulators, from politicians, from consumers. It's no longer a cool brand. Are you surprised at how they're reacting? And how successful will changing the name to Meta be? Oh, they've been brilliant. Whether it's deploying incredibly charming people to talk about the important discussion around gender balance or personal loss, to create these weapons of mass distraction so we don't focus on the negatives or really eloquent people with British accents then being thrown at the media or changing the name to meta to talk about the exciting world of the metaverse versus really

talking about the insurrection and, oh, I get a subpoena or asked to come testify in front of some government body. Well, you really should get the CEO of Facebook or asked to come testify in front of some government body. Well, you really should get the CEO of Facebook. There will be a new CEO of Facebook. I'm Mark Zuckerberg. I'm just going to talk about the metaverse. They've been brilliant. There's very few companies that have deployed, again,

this delay in obfuscation the way that Facebook has. So I would argue that they've been brilliant. I think it's been devastating for the Commonwealth how adept they've been. I loosely and affectionately call it cancer Mark Zuckerberg and his lipstick on cancer Sheryl Sandberg. I think they've done tremendous damage to the Commonwealth. And I don't even think it's their fault at the end of the day. I think it's our inability to regulate them and apply the same standards that we've applied to every other industry and every other company. I think the person who's at fault here is the man or the woman in the mirror, and that is the citizens who elect regulators, elect public officials to prevent a tragedy of the commons, which is unfolding every day with these technologies. There's absolutely no reason we can't regulate them. Scott Galloway, thank you for being on the show. Thanks for having me,

finally. Whoever canceled last minute, thank you. Well, that's it for this episode of Stay Tuned. Thanks again to my guest, Scott Galloway.