The Prof G Pod with Scott Galloway - America’s Progress Has Stalled — with Derek Thompson

Episode Date: February 2, 2023

Derek Thompson, a staff writer at The Atlantic and host of the Plain English podcast, joins Scott to discuss why he believes America is at a standstill when it comes to progress, including the lack of trust in institutions and a need for an abundance agenda. Follow Derek on Twitter, @DKThomp.  Scott opens by discussing potential business opportunities for WhatsApp. He then shares his thoughts on Buzzfeed’s decision to use OpenAi to create content. Algebra of Happiness: understanding the purpose of profanity. Learn more about your ad choices. Visit podcastchoices.com/adchoices

Join Capital Group CEO Mike Gitlin on the Capital Ideas Podcast. In unscripted conversations with investment professionals, you'll hear real stories about successes and lessons learned, informed by decades of experience. It's your look inside one of the world's most experienced active investment managers. Invest 30 minutes in an episode today. Subscribe wherever you get your podcasts. Published by Capital Client Group, Inc. Support for PropG comes from NerdWallet.

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cards, savings accounts, mortgage rates, and more. NerdWallet, finance smarter. NerdWallet Compare Incorporated. NMLS 1617539. Episode 232. 232 is the area code of Sierra Leone. In 1932, Amelia Earhart completed the first nonstop solo flight across the Atlantic by a woman. True story. Last week, I had a colonoscopy and the prep was a little much, but I think we found her aircraft. Can you come to the back of the plane with me so we can have a talk? Go, go, go! Welcome to the 232nd episode of the Prop G Pod. In today's episode, we speak with Derek Thompson, a staff writer at The Atlantic and the host of the podcast Plain English. I like

Derek a lot. Nice kid. Looks like he's eight. Is that true? That's probably not true. Looks like he's 19. Anyways, super impressive, nice young man. We discuss with Derek why he believes America is at a standstill when it comes to progress, including a lack of trust in institutions, the detriment of strong political biases, and polarization. What's happening? What's going on? The dog is in Miami. Alert the media. That's right. And guess what? The weather is much better in Miami than in London. I'm just figuring that out. And I'm also figuring out that the weather has an enormous impact on my mood. And you don't want the dog more of an asshole than he usually be honest, Florida's got its own thing going on, right? Whenever you hear about some dude who like, I don't know, murders his family and then goes and takes his dog for a walk or something and gets his dog, takes his dog to the groomer after killing

everybody, you know that dude is from Florida. However, there's Florida and there's Miami. Miami just is totally different. Florida is a wonderful place to live. It gets about 1% less wonderful every meter you travel from the ocean. You're 100 meters in from the ocean. There's very few redeeming qualities about Florida. You're on the ocean. It is a wonderful place, a wonderful state to hang out in. Anyways, a bit of a digression. We have housekeeping, however. We want to break down how our show works for those of you who are new around here

and honestly for those of you who have been around since the start as our programming has changed quite a bit since March of 2020. There's something called brand architecture, actually, in the world of brand strategy and that is you try and figure out the relationship between different brands and how you endorse them. Initially, it was Gap's Old Navy, then it was Old Navy by Gap, and then it was just Old Navy. There's halo strategies, endorsement strategies, sub-brands. It's not Tab, it's Diet Coke, et cetera. Anyways, I did that shit. I literally got paid a lot of money for about 10 years to help brands, among other things, figure out their brand architecture.

And why is brand architecture such a big sector in the consulting world? Because of mergers and acquisitions and spins and what have you. By the way, it used to be, I think, Dayton Hudson Target or Target, a Dayton Hudson company. Oh, my God. The fun facts keep rolling in. On Mondays, our market show delivers an update on the news impacting the capital markets. And you hear our insights on the top business stories,

market performance, and predictions for the week ahead. That's on Mondays, our market show. Markets Mondays. Mondays markets, I'm helping you. On Wednesdays, it's office hours where we answer your questions. By far, my favorite part of the week. Is that my favorite part of the week? It's probably my

favorite part of the work week. Occasionally when I'm writing my newsletter, No Mercy No Mouse, which comes out on Friday, I get the right balance of alcohol and THC and I write something that I think is actually worth reading maybe again at some point in my life. That's the most rewarding part of the week, at least professionally. But the part of the week that is consistently most rewarding is office hours where people call in. So that's on Wednesday. We answer your questions and we love hearing your questions. Anyways, let's review. Monday markets, Wednesday office hours. It doesn't really roll off the tongue. On Thursday, we dig beyond the headlines of the business and tech worlds and then bust into a conversation with a blue flame thinker. In addition, on Thursdays,

beyond digging the headlines, blah, blah, blah, on our blue flame thinker, you get the algebra of happiness segment delivered by yours truly. This is when we get in touch with our softer side. And on Saturdays, our friend, actor, and rock on tour, George Hahn reads our

No Mercy, No Malice newsletter. Monday markets, Wednesday office hours, Thursday, our conversation, Saturday, No Mercy, No Malice. Oh my God, enough about us. Let's get on with the news. We often harp on the fact that meta is a net negative for society. We don't harp on it. We just point out facts. But arguably one leg of its business that we don't give enough attention to, WhatsApp. We're talking about it today because CNBC reports that a growing

number of London Brits are using WhatsApp for luxury home purchases. I would not have guessed that. And that off-market home sales in London reached a record high in the last quarter of 2022, accounting for 22% of transactions. One in five home transactions are done off-market. You know, is that sort of surprising? Maybe. But what's really surprising is that WhatsApp, a lot of them are happening on WhatsApp. Facebook bought it for $19 billion in 2014. And, you know, is that sort of surprising? Maybe. But what's really surprising is that WhatsApp, a lot of them are happening on WhatsApp.

Facebook bought it for $19 billion in 2014. Roughly 2 billion people use it. So think about this. Everyone thought it was just a crazy acquisition. And that is one of the biggest acquisitions in tech history. And people thought that Mark had overpaid, given that he only paid a billion dollars for Instagram, which is arguably maybe next to YouTube, the best acquisition in the history of tech. But roughly 2 billion people use it now. So think about it this way. They paid about nine and a half bucks per user.

And even though they don't really monetize it now, you got to think at some point, they're going to be able to get more than nine and a half bucks per user. I also think it's one of the strongest brands globally. So many people use it. WhatsApp makes money through its WhatsApp business API. What is that? I don't know.

Business of Apps estimates that WhatsApp brought in $8.7 billion in revenue in 2021, with the majority of it coming from the B2B side of the app. So I take that back. I didn't think it was being monetized. I guess it is. So that's $9 billion. This is just a fraction of Meta's annual revenue in 2021, which was around $118 billion. In 2020, WhatsApp launched a payment feature in India, its largest market with roughly 400 million users. My God, think about that. 400 million people in India using WhatsApp. So this sounds like something that

could end up being the growth vehicle that Meta is so desperate for. For a long time, it was Instagram. Instagram's growth appears to be flatlining. So what would be the right business strategy here? What would you advise the Zuck if you were on the board? By the way, it's not a real board. We have dual-class shareholder companies. You're just an advisory board. You're just showing up, having dinner, and collecting a check. You really have no real meaning. Anyways, what would I do if I were on that board and I actually had any teeth and could get anything done? I would say, hey, boss, what the fuck are you doing? Put a billion dollars into a legless universe that nobody is using. By the way, true story, Horizons World,

that is the premier metaverse constructed by Meta, is getting less traffic than MySpace. MySpace now, MySpace gets triple the traffic of Horizons or Horizons World or whatever it's called. And more than 90% of the world's created get less than 100 people to come to them. This thing is just so hilarious what a failure it is. I mean, this is right up there with Diem or Portal or name whatever else Meta has tried to home grow. It just doesn't work. It is not an innovative company. It is a great acquirer and it's great at growing its current assets.

And what could they do? They made a great acquisition with WhatsApp. They should double down with that. It is a global brand. It could be the largest payment and communications company in the world. And that is probably worth somewhere between 100 and $300 billion.

And now Meta's entire company is worth $300 billion. So what could you do or what would you do if you were on the board and actually gave a good goddamn about shareholder value? You would say, hey, boss, we need you to double down on WhatsApp. We need to stop the silliness around the metaverse. And then what are we going to do?

We're going to spin WhatsApp. And that thing on its own is worth more than Orange, Verizon, AT&T, Vodafone. You name the telco. This is the premier telco in the world. WhatsApp. Oh, my God. This is where you come for the insights.

How do you say insights in Espanol? I don't know. All right. What else is happening? Let's talk about, let me think about it. AI, as in artificial intelligence. BuzzFeed plans on using OpenAI, the firm behind Chat down 30% over the past year. The trailing 12 months free cash flow is a negative $39 million. That's not terrible. It's almost break-even. And they laid off 12% of their workforce in December 22. Now, what's going on here? What's going on here? ChatGPT, the majority of people or companies

are looking at it through the lens of not value creation, but cost reduction. And when BuzzFeed announces they're going to use AI, the market doesn't go crazy because it thinks, wow, it's going to differentiate its service and it's going to have great articles. No. The reason that the stock triples is they assume that 50% of the people at BuzzFeed are dead woman or man walking, and that is they had just got fired, they just don't know it yet. And when likely 70 or 80 percent of your expenses at BuzzFeed are individuals who are editing or writing or creating algorithms to try and create new content, and they say, oh, okay, chat GPT, we'll get a site license or a company-wide license, and slowly but surely, we are going to massively reduce our workforce. What robotics did to manufacturing, this has the potential to do to media, information-based companies, maybe in certain parts of education.

I think over the long run, it'll create jobs. There's always a panic with a new technology that we, in fact, are going to destroy jobs. But over the long term, people come up with new applications and you actually increase the number of jobs. It's just that what we're really bad at, especially in America, is protecting the people who are put out of work. We don't want to invest in retraining them or supporting them while they try to figure out a new career. That's what we're really bad at. But generally speaking, these innovations in technology result in more productive economy, more jobs, and better paying jobs. Having said that, having said that, something that fascinated me, fascinated me, and it just struck me as like, wow, this just makes so much sense. You know when you read something and you

go, this is true? So my friend Raoul Pal, Raoul Pal, I think I'm saying it as nice, Raoul Pal, anyway, super bright, super nice guy. Kind of like this rare breed of rational Web3 guy. He's been talking about Web3 and crypto for a while, but I find him reasonable, which makes him 0.0001% of that community. Anyways, he said something that really struck me. He said, he had put out a tweet that said, chat GPT is one of the biggest deflationary shocks in all of history. And that just struck me as so right on the money. Because think about just, even if chat GPT doesn't, or AI doesn't live up to the hype, the perception that your job is under threat means that the most stubborn part of inflation, right? Let's back up

inflation. What is inflation? Inflation is when there's too much money chasing too few goods. There's a demand side and a supply side. People have money and want to buy shit. That's the demand side. The supply side, that is our ability to produce goods for people to buy, got a huge shock in the form of COVID and then the invasion of Ukraine. So, we had food and energy shocks, right? That seems to be fixing itself. The gunk is coming out of the supply chain. China is coming back online. We had reports of huge earnings misses from the chip makers. Why? Because they couldn't make enough during COVID because everyone wanted to be home and wanted more processing power and wanted a new laptop and wanted to upgrade their home audio system, what have you. But all of a sudden, boom, they

build in or they build up their infrastructure, their production capabilities, and wham, fears of a recession or a more normal state of income. And all of a sudden, there's a mismatch between supply and demand, and people can't get rid of these chips. Look what's happening at Tesla. They're cutting prices. Why? Because their production ramped up and it looks like they're producing too many cars. The price of chicken is coming down. The cost for containers to ship stuff from China to here, petroleum, natural gas, you name it. These things have absolutely plummeted in price even back to pre-pandemic levels. So on the supply side, we are seeing real relief around inflation. In other words, we are producing more goods.

The thing that has been most stubborn when you look at the levers around inflation have been wages. It has been really hard to slow the increase in wages. And okay, that's good on many levels, but when everyone is having to pay people more, it is inflationary, right? They have to raise the price of their products so they can afford to keep their people on the front line, and prices go up, and it becomes this inexorable upward spiral. Now, having said that, chat GPT might be the ultimate deflationary vehicle because, quite frankly, it not only reduces your dependence on certain employees and certain jobs,

but I think this is the key. I think it's psychological. And that is for the last 10 years, and I know this firsthand, if you were the CEO of an information age company, every conversation around HR was how do we keep our people happy? And it usually came down to

compensation, economic and non-economic. What's interesting is that I find non-economic compensation is more powerful. People want to work in a nice office. They want to have fun off sites. They want you to spend more time thinking about their career and coaching them. That's what they want. They really value non-economic compensation, which was weird because when I was their age, I was all about the Benjamins. I could give a shit, but maybe that's because I worked in a horrible atmosphere called Morgan Stanley. Anyway, they also want to be paid more. And the general belief, or my general belief, was that if you weren't increasing someone's compensation by 10, 20% a year and they were good, they were probably going to leave because there

was such a war on talent for the last 14 years. Now, if you're under the age of 40, meaning you kind of came of professional age in the midst of the most historic bull market in history, you're under the impression or the delusion, quite frankly, or the hallucination that your labor is always in demand, that you could just be you, just do you, and your compensation is going to go up dramatically the following year. Well, guess what? Capital and management has the upper hand, or at least the perception of the upper hand,

and aren't going to feel the same pressure to raise compensation as quickly as they have over the last 14 years. And that is going to bring down inflation. And what was one of our predictions in Q3 of last year, when inflation was roaring, that it would come down as fast as it went up. And one of the reasons, one of the reasons it's coming and giving it real wind or real headwinds around inflation, AI, chat GPT. Chat GPT's biggest impact on society over the next 12 months won't be the new things it can do, but the people it can replace. We'll be right back for our conversation with Derek Thompson.

I just don't get it. Just wish someone could do the research on it. Can we figure this out? Hey, y'all. I'm John Blenhill, and I'm hosting a new podcast at Vox called Explain It To Me. Here's how it works. You call our hotline with questions you can't quite answer on your own. We'll investigate and call you back to tell you what we found. We'll bring you the answers you need every Wednesday starting September 18th. So follow Explain It To Me, presented by Klaviyo. Mike Gitlin. Through the words and experiences of investment professionals, you'll discover

what differentiates their investment approach, what learnings have shifted their career trajectories, and how do they find their next great idea? Invest 30 minutes in an episode today. Subscribe wherever you get your podcasts. Published by Capital Client Group, Inc. Welcome back. Here's our conversation with Derek Thompson, a staff writer at The Atlantic and the host of the podcast, Plain English. Okay, Derek, let's bust right into it. Your recent feature story for The Atlantic, you wrote, we have become too enthralled by the eureka myth and more to the point, too inattentive to all things that must follow a eureka moment. So let's start there. What is the eureka myth and why is it problematic? The eureka myth is my name for this idea in science and technology that the most important

thing when it comes to human progress is that we discover new things. It's that we invent new things. So for example, if you're telling a story about progress in the 19th century, you'd say, the moment that Thomas Edison built the first incandescent light bulb, 1879, that's really what the great leap forward was. Or if you are looking at the story like smallpox, which is the story that I wrapped this article around, you'd say that the big moment in history was 1796, May 14th, when a physician in London, Edward Jenner,

administered the first vaccine in human history to young James Phipps to inoculate him from smallpox. But what that idea, this idea that eureka moments are the most important stories in progress, what that overlooks is the fact that at the moment of invention, nothing has really happened that changes people's lives.

At the moment that the first vaccine was administered, there were a billion people in the world and one of them had been vaccinated. That's not progress. That's a zero to one moment. It's not full progress. The one to one billion job of extending the vaccine around the world,

that is true progress. Same thing with electricity or same thing with something like the computer chip. The invention of these things is wonderful. It's really great to have it be birthed into the world. But real progress requires that we actually build what we invent. You need the rest of the story.

You need to actually build what we invent. And the U.S. does not build enough houses. We don't build enough solar panels. We don't build enough nuclear reactors. We invented all of this stuff and we do not build enough of it. And that is what I want us to do in this century, not just invent, but also implement. I mean, isn't this, to a certain extent, that we're big, bold thinkers, and we also just want to get rich quick?

I'll just relate this. I've been an entrepreneur my whole life, and I've always thought, okay, it's the small stuff that determines whether you win or lose, that it's the last 10%. All we need to do is take an existing consulting service, an existing analytic service, and just be a little bit better than anybody else across a number of dimensions. We didn't need to reinvent the wheel here. Do you see companies, is it a function of the, and I hate to say this, they're spending too much on R&D and not enough on operations? I think that that is exactly what's happening at the national level. And so I want to distinguish my critique of what's happening at the national level and then a critique of what might be happening inside of individual companies. So it is absolutely the case that at the national level, we have become enthralled to the Eureka myth.

And we are operationalizing that illusion by spending more money than ever on research and development. But even as we've become this country that invents the elevator in the 19th century and then the solar chip and the microchip in the 1950s and then the first mRNA vaccines in the 21st century, we are not the country that does the best to actually build out these things. We have a housing shortage. We don't build enough solar panels. We don't have the technological frontier in advanced semiconductors. We fell very quickly from third in the world to 37th in the world in terms of vaccination rate. I would diagnose this at the broadest level as being

a problem of culture. I think that the culture is the universal substrate here. One of the reasons why I think we have this problem in the U.S. is that we have a trust problem in American culture. You look at Democrats and Republicans and you look at their trust in institutions, it is plummeting across the board. We don't trust media as much as we used to. We don't trust each other as much as we used to. We don't trust each other as much as we used to. We don't trust whether companies or government. And I think that in a world where trust is impermanent, mayday, mayday decline, it is often harder to build what we invent.

And why do you think, I mean, Jonathan, hi, my colleague at NYU talks a lot about it's difficult to have a democratic society that prospers without having a certain set of collectives or shared values as evidenced by trust in institutions. Where do you think our erosion in trust in institutions sprang up or where did it begin? I think there's a couple different sort of waterways that feed into this collective decline in trust. I think one of them is the fact that you look at something that happened in U.S. society since maybe the 1960s and 1970s, when a certain kind of apocalyptic thinking became very in vogue in intellectual circles and then in the general public. You had the 1960s and 1970s, people becoming much more concerned about the environment, often for good reasons, about overpopulation, I think for sometimes less good reasons, about the fact that the government was hiding things

from them, that we had built nuclear weapons and that we would use them to destroy the world. And we moved, I think, from a society that was broadly optimistic about science and technology to a society that was broadly fearful of science and technology to a society that was broadly fearful of science and technology and by extension of elites. So I think that's one headway for this. Another, I think, is the fact that, and I struggle with exactly how to talk about this, but actually in a previous conversation on my podcast, I think Scott, you and I talked about it a bit. I think that as society becomes more media focused, as we all become players in an attention economy, we all learn the same strategy. And one really, really effective strategy for getting attention is catastrophizing the world. There is something about human nature

that responds very predictably to catastrophe. And if you're trying to get people's attention, being really negative in a high arousal way is a great way to do it. And so as more people, more scientists and academics, but also more politicians, more people on podcasts certainly, become more negative about the world without having any kind of positive prescription,

I think it leads to a world where we have less trust in each other because every new media source is telling us that the media, capital T, capital M, is wrong. And that reduces any kind of public trust in a shared set of facts or in a shared set of institutions. So there's a lot of reasons why I think trust is declining overall, but I would just at least first offer a historical reason and then a kind of sort of attention economics reason. A third reason, just to quickly gloss, and maybe you're going to hit it anyway, or certainly some of your listeners were thinking about it, is that I think that some of this is macroeconomic. I think that as the middle class has lost its footing in the U.S. economy, and you've

written and talked about this quite a bit, I think there's just become less trust in the system, the system. And this you can trace back to globalization not working out for everybody, letting China into the WTO, that not working out for anybody. And so when you put all these things together, the political climate, the media climate, and the economic climate, I do think that all of them are feeding this general decline in trust. Yeah, it also feels as if a lot of it, I hadn't thought through some of the stuff you thought through about science and nuclear weapons and the dangers of technologies eroded trust around

institutions. But also, I think, have you thought about, or what I think a lot about is kind of the 80s and that as Reagan and Thatcher, you know, the dangerous words, I'm here from the government and I'm here to help, that we went after the biggest institution. And when the president started saying you can't trust the government, we kind of lost our connective tissue. And for the last 40 years, we've been on this kind of screed against government, which is sort of, I think, obviously, I would think for most people, kind of the premier institution. If you can't trust your government, it's sort of like, what institution are you going to trust? I couldn't agree more. I think that different paradigms, different political economic paradigms suit their moment and create a vocabulary through which we understand the world. And for a certain period

of time in the 20th century, that vocabulary was a New Deal vocabulary. It was a, we're all in this together. There are crises outside of the U.S. and within the U.S. that require an all-hands-on-deck approach, and we all need to come in to help the middle class. That worked for a while. That helped to define politics for a while. But then, as you just mentioned, something happened around the 1970s, 1980s. Whether it was the oil crisis or the inflation crisis or a general decline in trust in government

because MLK and JFK and RFK had all been assassinated and we just thought, what the hell is going on? You suddenly had an opening for a new paradigm to replace the New Deal. And that new paradigm was Reaganomics. It was neoliberalism. It was whatever you want to call it. It was this idea that the government

is a force of evil and pure incompetence. Evil or pure incompetence, I should say, to be fair. And as a result, since then, you've had a really clear decline in public-private partnerships. And you've had this, I think, really adversarial relationship between business and government. I think it's time for a new paradigm. I think that when you look at the biggest problems in the U.S., they are often problems of scarcity. We know what we need to do in order to accelerate some treatments for cancer therapies, but we aren't

putting in place at the FDA or at the NIH the kind of rules that would get us better cancer therapies. And that's why I have been thinking a lot about this new concept that I hope can replace neoliberalism, which I call abundance politics, right? You identify a handful of areas that are essential to human flourishing, whether it's education, housing, healthcare. And you think, what are the bottlenecks? What are the key bottlenecks that are holding back abundance in these sectors?

How do we resolve those bottlenecks? Where's the biggest debate? Is it housing? Is it healthcare? Where do you see the greatest dearth of abundance or scarcity? We can start with wherever you want, but I'll take the first two H's that you mentioned, housing and then healthcare. So on housing, we know this is a great example of the fundamental theory that we've already

invented the technology. The problem is implementation. The problem is that there are rules at the local level, at the state level, that in too many places, and in particular, in some of the richest left-leaning places, blue metros like San Francisco or New York or Boston, we have too many rules that make it impossible to build because of nimbyism or because of certain regulations that make apartment buildings hard to construct. So obviously, we need to resolve those. But that's a common area that people know a lot about. Here's something that might surprise people. The U.S. obviously has a healthcare cost crisis. In many cases, that's an access problem. The U.S. has the fewest general practitioners, general physicians per capita of any country in the OECD.

Why? Well, one reason is that we've designed a system that is the longest and most expensive medical education system in the world. No other country takes as long and is as expensive to educate their future doctors as the US. Now put yourself in the position of someone who's just spent eight, nine, 10 years going through undergraduate medical school and

residency programs, you're $300,000 in debt. Do you want to become a physician to help many, many people but not earn very much money? Or do you want to become a specialist where you're sure you could earn a higher wage and discharge that debt that you've picked up in order to punch your ticket as a doctor? Well, of course, most people are going to want to become specialists. But that means you've designed a system where we are strategically short on general practitioners, on physicians. So fewer people, especially fewer low-income people, have that early touch point into the healthcare system, which means that more Americans die of preventable diseases, which means they tend to incur much higher costs as they get extremely sick.

So here again, I think one of the big problems we have in healthcare is a crisis of scarcity. If we want an abundance agenda in healthcare, I think we need more of an abundance in physicians. We need to understand where's the scarcity and how do we remove that bottleneck? Yeah, it feels as if we have sort of adopted this rejectionist luxury culture where once I have a house, try and figure out a way to create scarcity in housing, a degree, make admissions more

difficult. Once I have a company, a tech company, try and weaponize government, such a new entrance can't get out of the crib, such that I can develop monopoly power. There's definitely something to this notion that, you know, everyone is sort of, we have an economy of people pulling the bridge up behind them. What have you thought at all about, you talk a lot about polarization. Are there any, I don't imagine there are any quick fixes, but what are some fixes to trying to solve the issue of polarization on our side, on our politics? It's one of the hardest questions to answer. I don't know how to do it necessarily at the national level, but let me tell you about some conversations that I've had, just one-on-one that I think might be sort of illuminating. I was talking to a friend in

California, an older friend who was talking about their situation living in Beverly Hills and their son's situation. They were complaining about construction down the street. They're living in Beverly Hills. They're complaining about construction down the street. And they're like, oh my God, they're constantly trying to put up these new ugly apartment buildings near our homes. It's so disgusting and it's so loud. And I really hate how it's disrupting traffic. And then I was asking, what about your son and his search for a new house in Los Angeles? And she said, oh, it's impossible. He can't find a place to live in this city.

There's no new houses being built. And so it's so interesting because so many people seem to allow both these paradigms to exist in their head at the same time, that they don't want the circumstances that would allow their children to thrive, but at the same time, they're complaining about the lack of success allow their children to thrive, but at the same time, they're complaining about the lack of success for their children's generation. I think that people need to think more intergenerationally about abundance. We already do think intergenerationally

about some other things like, say, education. People who send their children to private school typically don't also ask to not pay local taxes that might go to education. There's a general understanding that you pay to educate the next generation and you should pay to educate the next generation. We do this in the US with social security as well. 13 point whatever, 14 point whatever percent of my paycheck goes out of my salary and goes into a fund that pays for the retirement of other people. I understand that I belong to an intergenerational pension program in the US, and I personally don't see a lot of people complaining constantly about it unless they're relatively right wing. So it's interesting, I think, that we do think generation to generation

about some things like education and retirement, but we don't think generation to generation about other things like housing availability. But if we did, if we did adopt this forward-looking intergenerational approach to building more in America, I think we'd be in a much better place. And I think it would make us less polarized because we'd be thinking not about how do I most efficiently pull the ladder up once I become settled. We'd be thinking about what is the nature of the ladder that ensures the success of my children and their children's generation. Yeah, it sort of all ties. I've been fascinated recently with all these articles or new data on kind of this birth implosion. And you talked about

how in the 70s, we were worried about population explosion. Now it appears that we were wrong, and it's population implosion that threatens the West. And this rejectionist or this lack of, as you call it, abundance mentality where there's less housing, less education, less healthcare, and it just drives up costs. And I can't imagine that that hasn't played into the calculus of a new generation of people saying, you know what, I just can't, I either can't afford kids or I don't want the stress, the economic stress of kids, because with kids comes the need for a house, the need for education, the need for additional healthcare, all of which have become much more expensive. Have you linked it or thought about how all this plays into our kind of our birth dearth? Yeah, two thoughts on that. One is you're absolutely right. People like Paul Ehrlich

were predicting that we'd have this absolutely catastrophic population bomb in the 1970s. What he didn't pay attention to is the fundamental core law of population and fertility growth in the world, which is the richer you get, the fewer children you have. Or the more educated, yeah. Or the more educated, right. And then education and income seem to have this thing. Especially women. And you finish the sentence, especially women. But basically, if you want, right, I guess the most demographically accurate thing would be that as women's education rises country by country, fertility rate declines. And certainly that is a good thing. We want families to be able to control how many children they have.

We don't want women put in positions where they have no say over their lives. And therefore, they feel obligated to have six, seven children because they have no say in their politics and in their economy. At the same time, I think there are absolutely problems at the national level, right? Not at the family level, but at the national level of population decline. And one of them is that there's only two ways that an economy grows. You either add more people or you add more productivity. That's it.

There's no other way that an economy grows. And if you aren't growing productivity and you aren't growing population, you have a shrinking economy. And in a shrinking economy, zero-sum thinking is rational thinking. It is literally zero-sum. The pie is fixed.

In fact, it's declining. In economies that don't grow, they are zero sum. And that, I think, is a problem. We want to avoid that kind of zero sum thinking. We want to give people an opportunity to overcome it. And so I'm a fan of growing economies. I'm a fan of growth. And therefore, I'm a fan of, in the US, more liberalized immigration policies. Because while I would love to have a population that has maybe a natural replacement rate, the truth is we're probably not going to get there. If you look at the situation in Japan and Europe, there's sort of a little bit further ahead of the story than us here. If we're not going to have a natural fertility rate that's

above the population replacement rate, we should have a liberal immigration policy that allows more people to move into this country and contribute to a growing population. I'm a fan of that. I would say one more thing about this concept of a zero-sum mentality, a zero-sum economy that is flat or shrinking forever, which is what you get in a world with low productivity and persistently shrinking populations.

There's a concept in the book, Scarcity, which is a book about economics. I think Sindhil Mullainathan might be one of the authors. He talks about that one of the things that happens in environments with scarcity is a psychological phenomenon he calls tunneling, that people become very, very focused on a handful of things when they feel it necessary to be a zero-sum thinker. And part of the abundance mindset that I'm trying to propagate here is that we can't be so tunneled in on ours, ours, ours, that actually the way to grow the pie is to think more collectively, not just in terms of the here and now,

but also intergenerationally. To the extent you're comfortable talking about it, what's your calculus around having kids? You're a successful, thoughtful, well-resourced couple. And I find that more and more people like yourself who are kind of out of central casting for who you would want to have kids are not having kids.

Yeah, we want two kids. Um, and it's also the case that, you know, in addition to the phenomenon of more education leads to, uh, smaller families, it's also the case that more education tends to lead to later family formation, that people tend to have kids later in their life. And there's all sorts of debates happening right now about the degree to which that is the right move. I think there's certain benefits to having financial security before you have kids, especially in a place like Washington DC or London or New York City, where the cost of having a kid is really, really high. And just like getting them through

pre-K is a financial chore that you want to build a certain amount of savings before you start that part of your life. But that again, might be something that touches upon an abundance agenda. Maybe in a world where childcare is a little bit more abundant or less expensive, the calculus for some families might change so that they don't need to feel like they have to save so much money before they begin the process of growing their family. Derek Thompson is a staff writer at The Atlantic and the author of the Work in Progress newsletter. He's also the author of the book Hitmakers, How to Succeed in an Age of Distraction. He joins us from his home in Washington, D.C. Derek, appreciate your time. Thanks, Scott. We'll be right back. you. The rest of it doesn't really matter. Luckily, there's Constant Contact. Constant Contact's award-winning marketing platform can help your businesses stand out, stay top of mind, and see big results. Sell more, raise more, and build more genuine relationships with your audience

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How will AI affect both? And how are these tools changing the way we use our computers to make stuff, communicate, and plan for the future? In this three-part special series, Decoder is surveying the IT landscape presented by AWS. Check it out wherever you get your podcasts. Algebra of Happiness. So I've got into a fight with Maya, not a fight. I think conflict and debate are part of progress. My producer over at Pivot keeps editing some of my more profane or saltier, edgier comments, and it really pisses me off. And we've gone back and forth, and she is

just doing her job and doing her level best to protect the enterprise and probably protect me. And there's a method to the madness, and there's, I think you want to be thoughtful around how provocative or how, I don't know, what's the term? I guess provocative is the best term for it. I'm a vulgar and profane person. And it's not an act. And if you listen to this show, you know that it's authentic. This is how I think. I curse a lot and make a lot of, I don't know what the term is, off-collar comments. And a lot of people come to me and say, well, I love how provocative you are.

And I'm trying to think about how to incorporate that into my professional life. And my advice to you is don't. So this comes from a place or this tone of being aggressive and profane and vulgar sometimes. It comes from a place that is more strategic than you might think, and that is I consider myself a progressive on almost every social value, political value, economic value. I say I'm center left, but the reality is I'm probably pretty far left. And something that I think has weakened progressive policies or our ability to get anything done is that we have become so sensitive. We have become so easily offended. We have become so focused on how we divide each other by making a cartoon of each other's comments and then making assertions and getting into this game of guardians

of gotcha and trying to get virtue points. To be offended in our nation is to be right, and it's total bullshit. Being offended is your emotion, and productive conversations are, this is why I think you're wrong, or this is my view and how it contrasts with yours. That's a productive conversation. And the left is spending so much time trying to find virtue points by calling out each other that it makes a cartoon of the important work we need to get done around systemic racism, around income inequality, around women's rights. And it ends up hurting us because we're seen as just people who are worse than anything, that we're just fucking humorless. And also we've incorrectly conflated vulgarity and profanity with being a sexist or bigot. And the two have absolutely nothing to do with each other. If you look back in history,

the real liberals in media were comedians, Lenny Bruce, Richard Pryor, George Carlin, and they were the most profane comedians. And part of the power of communicating ideas is humor. And I see with the modest platform I have, and I generally believe this, I want to take profanity or help take profanity and vulgarity back for progressives. And it's okay. And one of the things I value so much about my relationship with Kara on the Pivot podcast is I say, you know, inappropriate or edgy jokes about my sexuality, about her sexuality, about how hot someone is or what have you. And there'll be a pause, an uncomfortable moment, and then she laughs and it gives everyone else

permission to laugh, realizing that part of accepting each other is recognizing and ribbing each other for our differences. It should never be mean-spirited. It should never diminish anybody. And if someone were to ever say to me, your comments make me feel diminished, I will stop. But humor, vulgarity, profanity have been incorrectly conflated with weird, conservative, far-right, discriminatory behavior. And that just could not be further from the truth. Having said that, having said that, I'm in a position to do this. Because while I can be canceled, I have economic security. I have a certain number of people in my life. I'm on the back nine of my professional career. And I realized when I say these things, there's a non-zero probability someone is going

to go crazy with it. And whatever the mood is or the ground underneath us at that time will result in, you know, a quick and severe end to this podcast or what have you. And I care, but it's not profound for me. And if you are economically secure and have people in your life that love you, you have an obligation to speak your mind and say things that you think are true. If you are not, be careful. And that is your job in a corporation, your job in a large organization is to be mindful and thoughtful and err on the side of grace. And it scares me because I hear from a lot of people, specifically young men who say they want to be more aggressive and provocative in their comments. And my attitude is don't because occasionally I get it wrong and I say

stupid things. But let me finish where I started. Vulgarity and profanity are vulgarity and profanity. They do not have anything to do with your political views. Who is one of my heroes? Michelle Wolf. She's my favorite comedian. She gave the White House correspondent dinner opening. She is incredibly vulgar, incredibly profane. And I think she's a genius at getting across in a funny, irreverent way what are some of the just ironic and ridiculous disparities in our society around women's rights and conservative versus progressive. Anyways, a bit of a riff, a bit of a riff, but recognize that when your friends are profane and vulgar, if you don't like profanity and vulgarity, that's one thing. But don't assume

it has anything to do with their political views or the way they treat other people. Our producers are Caroline Chagrin, Claire Miller, and Drew Burrows. Jennifer Sanchez is our associate producer. If you like what you heard, please follow, download, and subscribe. Thank you for listening to The Profiteer Pod from the Vox Media Podcast Network. We will catch you on Saturday for George Hahn's reading of Numerous You Know Malice and on Monday with our weekly market show. At the end of the day, the board is there for two reasons. Solamente dos razones. Here in Miami, bring in a little Espanol to the podcast. Hey, it's Scott Galloway, and on our podcast, Pivot, we are bringing you a special series about the basics of artificial intelligence.

We're answering all your questions. What should you use it for? What tools are right for you? And what privacy issues should you ultimately watch out for? Hello, I'm Esther Perel, psychotherapist and host of the podcast, Where Should We Begin? you get your podcasts. and managers. Listen in as I talk to co-workers facing their own challenges with one another and get the real work done. Tune into Housework, a special series from Where Should We Begin, sponsored by Klaviyo.