Biden Wants to Bump Up Corporate Taxes & The US Could Actually Ban TikTok

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0:27Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, he's in love with the state of you. Biden touted his economic record in a fiery address to the nation last night. Then one bad review from a YouTuber could lead to an entire automaker going out of business. It's Friday, March 8th. Let's ride.

0:52Happy International Women's Day, especially to all the women who listen to Morning Brew daily. We promise we won't release a perfume for you like Binance did or do any other cringy brand activation. But yes, happy International Women's Day. And fellas, take this as a reminder to make sure you tell the women in your life that you appreciate them. Now let's hear a word from our friends over at Factor. I want to call out a very cool thing that's been happening with Factor ever since we've partnered with them. People keep seeing Factor trucks out there while listening to the podcast. It's true. We've gotten multiple emails from you snapping photos of a factor truck doing its factor thing and delivering ready-to-eat chef-made meals, all while we're telling you about their ready-to-eat chef-made meals.

1:35So we want to let you in on a little secret. It's actually us in those cars. Once we publish the show in the morning, Toby and I, as well as executive producer Emily, technical director Yuchenna, and even Billy Bonino on audio hopping factor-branded trucks and crisscross the country, hoping to get spotted. I can't believe you just revealed our top secret marketing tactic. But yeah, let's hurry up and finish the show so we can jump behind the wheel. While you keep an eye out for a factor truck, head to factormeals.com slash morningbrew50. Then use code morningbrew50 to get 50 % off. Once again, you can get 50 % off delectable meals by going to factormeals.com slash morningbrew50.

2:12Then use code morningbrew50. Raise the runners. Raise the sails. Raise the sails. Captain, an unidentified ship is approaching. Over. Roger. Wait, is that an enterprise sales solution? Reach sales professionals, not professional sailors. With LinkedIn ads, you can target the right people by industry, job title and more. Start converting your B2B audience today. Spend$250 on your first campaign and get a free$250 credit for the next one. Get started today at LinkedIn.com slash campaign. Terms and conditions apply. With concerns swirling about his age, 81-year-old President Biden delivered a defiant State of the Union address that drew sharp lines between himself and his likely opponent in the upcoming election, Donald Trump, who Biden referred to numerous times as my predecessor.

3:01The speech covered a lot of ground in 68 minutes, touching on January 6th, abortion, Ukraine, Israel and Gaza, and the southern border. Biden also highlighted his economic record, saying he inherited an economy that was on the brink and turned it into an economy that is the envy of the world. And it's true, the U.S. is lapping other countries when it comes to economic growth. But what I want to start out talking with you, Toby, is perhaps one of the more under-discussed but hugely consequential issues in the upcoming election, taxes. Whether Biden or Trump wins will have major impact on Americans' taxes.

3:35Since many of Trump's 2017 tax cuts expire in 2025, leaving their fate up to the next administration. Biden in the State of the Union reminded everyone that he'd raise taxes for corporations and billionaires if reelected. Yeah, I actually, as soon as the State of the Union was published on the White House website, I control F taxes just to see how many times it was mentioned in the speech. It was mentioned six times in his prepared remarks. Four were to say how rich people and corporations need to pay their fair share. And then two were to say that normal people won't have their taxes raised under Joe Biden if he was reelected again.

4:09But yeah, Biden says he wants to raise the minimum tax for corporations to 21 % as well as lift corporate tax rate up to 28 % from the current 21%. And you're right. That is the big showdown and the big bifurcation between these two candidates is that Trump would likely extend the tax cuts that he passed last time he was in the office. And then Biden wants to roll those back. I mean, it is a huge policy difference between the two administrations. So whatever you think of the election other than policy, and you can have a lot of opinions about that, there's actually a big difference between Republicans and Democrats and what they would do with taxes.

4:44It is actually a$6 trillion question, because if Trump extends—if the future Trump administration extends their tax cuts, it's going to cost the government$4 trillion over a decade. Meanwhile, if Biden gets into—or is reelected and does his tax proposals, that will raise $2 trillion for the government. So it's really a$6 billion at stake in this next election. Yeah,$6 trillion. He also kind of touched on the housing market a little bit and how offered a few proposals on how to kind of unstick it right now. One proposal is on the housing front is to offer first-time home buyers a$5 ,000 per year credit for two years.

5:25Again, you want to try to help people get that starter home. But then another proposal is that he wants to provide a one-year credit of up to$10 ,000 for families who sell their starter homes. because, again, a lot of people locked in these really low mortgage rates. They don't want to sell the house because they would have to then buy a new house at a higher interest rate. So it's kind of figuring out how to grease the wheels a little bit, get the housing market flowing. That was another thing that he called out in the State of the Union. Yeah. And again, these are proposals. They're they're very fanciful.

5:55They're not likely to be enacted. But the point is to frame the debate ahead of the election and whatever his future administration does. it'll likely be you know maybe a split congress so they'll have to compromise in many areas but this basically says here's my as we start negotiations here is my pie in the sky ideas let's move on if you opened tiktok yesterday you might not have seen your usual diet of cooking videos that you'll probably bookmark but never come back to instead some of you came across a pop-up warning that quote congress is planning a total ban of tiktok then prompting you to find and call your representative to fight a bill moving through Congress right now.

6:33The dire call to action from TikTok is in response to a vote from a key House committee that unanimously decided to approve legislation that gives the app's Chinese owner, ByteDance, six months to divest from TikTok or else face a ban in the U.S. I know we've been talking about TikTok getting banned for literal years now, but this is one of the more significant steps yet towards limiting access for normal people in the U.S. Now, as for that push notification, reps on Capitol Hill are none too happy that their phones are getting flooded with calls concerned about losing access to the app. But rather than change their mind, Axios reported that it's just made politicians even angrier and more set on passing the bill.

7:14Neil, tension around TikTok, but also U.S.-China tension in general seem to be reaching a peak right now. It's crazy. First of all, this bill came out of nowhere. I didn't know it was happening. And all of a sudden, there's a huge push to start banning TikTok, or as lawmakers call it, forcing ByteDance, a Chinese company, to divest from TikTok within five months. And it passed this big House committee, and then next week it's going to be taken up by the House. So this is a huge momentum swing that a lot of lawmakers, and I should say bipartisan lawmakers, because it is supported by President Biden, as well as the Republican House Speaker Mike Johnson, to kind of get TikTok out of app stores.

7:54So I mentioned this House committee, it's the House Energy and Commerce Committee. It voted 50 to 0 to again, bipartisanship is not something you see a lot these days, but 50 to 0 on a bipartisan community committee just goes to show how kind of unified Congress is right now against it. Also, I was reading a little bit into the PR war that TikTok is trying to wage right now because sending a push notification to tell users to call the rep, that is a very almost invasive step to take. You had to manually enter your zip code too, which didn't do anything to ally fears that TikTok is tracking you.

8:30Now they have even more data on where you live. So I think that this kind of push could work if TikTok was a US-based company. But when you have a Chinese company telling you to influence your US elected officials, it rubs people the wrong way. So I think this is a gamble that I don't think is going to pay off. It absolutely it absolutely backfired because it just confirmed the fears of what people have around TikTok, which is that the Chinese government is using it, whether that this is right or not. The fears are that the Chinese government could use it to influence American democracy and meddle with things we have going on here.

9:05So basically just confirmed everything that we were worried about. Yeah. And then meanwhile, over on the Chinese side of things, they've been kind of intensifying its efforts to run this, quote, delete America from its technology campaign. Remember, as China kind of came into industrialized and came into the modern economic superpower that it's been, U.S. technology companies were right there alongside it. Both hardware and software companies rode China's ascendance. But now China's in a place where they feel like they can replace a lot of the American software and hardware companies themselves with homegrown things.

9:40So there is a big push going on right now in Beijing to kind of remove America from its technology stack. And that's seen with Apple's iPhone sales, which have cratered 24 percent in the first six weeks of 2024. Man, the more you read about Chinese espionage and its ongoing economic war with the United States, especially in terms of AI, there was a Chinese national former Google employee who was charged with stealing AI secrets just this week and handing them to Chinese AI companies. gives you a little goosebumps. Okay, moving on to something completely different. Jake Paul will box Mike Tyson on Netflix is a headline you would have thought The Onion wrote in 2019.

10:21But in 2024, it is all too real. The 27-year-old Paul, a YouTuber turned boxer, will step into the ring against Tyson, the 57-year-old former heavyweight champ. The action will stream live on Netflix on July 20th at AT &T Stadium, home of the Dallas Cowboys. There's a lot we don't know, like whether this is going to be an exhibition fight or how much the two are getting paid. But we do know it's another big step by Netflix into the sports entertainment space. Even as other streamers have paid big bucks for the broadcast rights to live sports like Amazon and Thursday Night Football, Netflix has opted for a more cautious approach with its biggest splash being a$5 billion deal to stream WWE.

11:03Toby, a lot to get into on the business side of things. but the thing people really want to know your opinion on is who you got to win. I think we're all coming out of this losers. The fans are going to be the biggest losers. No one is going to win in this scenario. I mean, everyone's going to get their bag, do what you got to do. I can't fault Mike Tyson or Jake Paul for probably bringing in a lot of money from this exhibition. But I noticed you mentioned Netflix is pushing into the sports entertainment space because this is not true sporting contests. It is mostly entertainment. but I do think that Netflix may are and Jake and Mike Tyson are jumping the shark here a little bit in the sense that fans are not stupid Jake Paul tweeted out this promo video of Mike Tyson like looking really good in the ring everyone immediately knew that it was from four years ago and that's not the current shape he's in even the picture that they're using of Mike Tyson for the promo card is him from 19 years ago that they photoshopped the tattoo on him to make it look like it was recent so i do think they are netflix and jake and mike are flying dangerously close to alienating their users because i are the people who might watch this fight because we know that this is not going to be pretty yeah it's a little bit of a farce yeah i mean netflix's strategy here is a little bewildering i mean they clearly don't want to pay what you have to do for live sports right now is pay billions and billions and billions of dollars because that is the only thing people watch live appointment viewing these days.

12:29But they've also been tiptoeing into the sports space with exhibition tennis matches and exhibition golf matches and their documentaries. Just feels like that old business adage. You have to spend money to make money. And Netflix is just tiptoeing in. And I'm not sure they're going to see any investment on their little spending in these sports entertainment pieces. Maybe WWE is—I mean, obviously, WWE is a big property. but I don't know. It just, it feels a little confused and they're not willing to just dive in like the other streamers. Yeah, they've definitely done what they have done well, which is the drive to survive, the point, the break points, the full swings of the world, which are these sports documentaries.

13:09And I do think that the eventual vision is to pair live sports with these behind the scenes documentary. Right now though, yeah, it is, they're not cannonballing in. They are tiptoeing in these kind of weird sports entertainment events. I say all that, I kind of was being mean in the beginning of the show. I will definitely watch it though. Cause like, come on, it is Mike Tyson. It's Iron Mike. Okay. Before we take a quick break, stick around because we have a stock of the week, dog of the week coming up right after this. Eczema isn't always obvious, but it's real. And so is the relief from EPCLIS.

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15:09You know what time it is. Stock of the week, dog of the week time. We're going to take you through one stock that is already studying up for their March Madness bracket and one stock that is just going to wing it based on vibes. Neil, I tip my hat to you because you won the pre-show horticulture contest. What is our stock of the week? What does that involve? I'm not telling the people. It's horticulture, though. You got a green thumb. All right. My stock of the week is Target, whose stock is up 12 % after it revealed a plan to compete with the big boys of retail. Like Amazon and Walmart, it's going to have a new paid membership program called Target Circle 360.

15:46The plan will offer unlimited free same-day delivery in under an hour for orders over$35 and free two-day shipping. And in a special deal next month, people can get it for$49 per year, but after that, it'll cost$99. Target does have an existing loyalty program that gives you coupons, but this is a more robust service intended to compete with Amazon Prime and Walmart Plus. And given the stock pop, investors are clearly excited what Target's got in the pipeline, which includes not only this membership program, but also a plan to build 300 new stores and expand its private label brands. Yeah, this is kind of the retail, big box retail renaissance playbook.

16:28You have to have an Amazon Prime-esque membership service that includes fast delivery. You also have to double down on your own private line of goods, private label line of goods. They have this line called Dealworthy, as you mentioned. So I think they're trying to run the playbook and investors are finally happy to see them jumping on board on the things that others like Walmart and Amazon have been doing for years now, but they're finally getting up to speed. Yeah, Target's in this weird place compared to Walmart because more than half of its sales are discretionary items, which are items you don't really need, like the electronics of the world.

17:05Meanwhile, Walmart has this big grocery business, so it tends to do better in times where people are hurting a little more. There's more recessionary vibes going on. So Walmart's really well positioned in that space. Target is not so much, and it did suffer its first annual sales decline since 2016 last year. But it's rolling out this membership program. It got rid of this big inventory glut. It had built up during the pandemic with all those supply chain problems. So it is repositioning itself for a good few years. And yeah, those private label brands are huge for Target. I mean, they do$30 billion in sales from those private label brands.

17:40They just rolled out a new one called Dealworthy. And most of these items are going to be priced under$10, some under$1. So it's all about those essentials that you don't want to pay up for. Target wants to own that space. And Target has actually outperformed Walmart, the stock, since 2019, which I don't think I would have guessed. They're both getting lapped by Costco, though, which I would have guessed. My dog of the week is the electric vehicle maker Fisker. So there's this YouTuber named Marquez Brownlee, who is one of the OG tech influencers. The guy is awesome, gives very pragmatic reviews of stuff like the Vision Pro, new phones, et cetera.

18:16But he's recently gotten into reviewing cars and just published a video where he called Fisker's latest EV, the worst car he's ever reviewed. Again, Marquez is not prone to hyperbole. When he says something like that, he means it literally. The video blew up, racking up over 4 million views and has actually reached Fisker senior management. They began calling around, trying to get someone out to update the software in the car, which was the main gripe Brownlee had with it. Well, it turns out Brownlee borrowed the car from a local dealership and another TikTok ended up going viral of this super weird conversation a dealer had with a Fisker senior engineer trying desperately to repair some of the bad PR Brownlee's video generated.

18:59In total, the stock is down around 45 % since the video was posted, and it just shows the power a single reviewer can have these days. It does. It also shows how cars and other hardware makers are shipping out these products maybe before they're ready. Fisker really wanted Brownlee to update the software. They said, we have this software update. What you're driving is not necessarily what everyone's driving. We want to give you this update. And Marquez said, no, I want to review the car as it's out in the public right now. And so that was the source of the tension. It also reflects how these companies are sending out products with the ability to update them, maybe when they're not ready for prime time.

19:38Yeah, absolutely. And just to be clear, though, Fisker's troubles are not stemming just from this one video, although that did contribute to it. about a week ago, Fisker said that there is substantial doubt that it will have enough money to make it through the year. They said that in a filing with the SEC. So Fisker, kind of a younger, newer auto EV company, feeling a lot of pressure from a lot of different places and throwing this review into the mix did not help anything. There are talks of sort of a bailout emergency$400 million investment from Nissan who might come and be the white knight to rescue Fisker from going off a cliff.

20:11All right, let's move on. In your journeys through the great capitalistic smorgasbord that is America, I have no doubt you have come across a combination Pizza Hut and Taco Bell or maybe an Auntie Anne's in Cinnabon. But a new dual branded combo restaurant is coming your way, ready to change the smells and sights of the U.S. dining landscape. It's Applebee's and IHOP. Yes, finally you can pair a 2 for 20 appetizer featuring boneless nuggets and chicken wonton tacos with a short stack of double blueberry pancakes like you've always dreamed of. The idea behind the combo restaurant from parent company Dine Brands is to increase revenue by offering up menu items that hit at all hours of the day.

20:52IHOP will take the morning shift while Applebee's can pop off at night. But Neil, are combo restaurants the future of QSR? Are we even ready for the smells that are about to emanate from these crossbreeds? I mean, it makes too much sense to combine your neighborhood bar and grill with your neighborhood pancake emporium. But, you know, Dine Brands does have a few of these locations overseas and they're killing it. I mean, the CEO says they make twice as much revenue with the same amount of square footage. So I'm just to borrow some corporate lingo here. The synergies are truly incredible. You need to have one kitchen that serves two restaurants.

21:26so there are a lot of cost savings and a lot of maximizing efficiencies and i know that's very buzzwordy but it's actually true when you combine resources and think about the delivery costs too when you don't have to pay a delivery vehicle to go to two separate locations they can bring everything just to one place so you can really save a lot of money from these kind of things yeah so they are both under dine brand's umbrella but these are two brands that are heading in kind of opposite directions applebee's is shrinking the company closed 46 locations only opened 10 new ones. Meanwhile, IHOP added a net 33 new locations.

21:59So I do think that they're trying to bring Applebee's up, bring the Dollarita up. Maybe the Dollarita wasn't as profitable as they thought and kind of pair it with IHOP that has been doing well. But I do have to wonder, as soon as you start seeing these dual branded restaurants sharing the same space, what other restaurants would you want paired together? So Neil, what are your thoughts? What would you want to see? Yeah, I'm thinking maybe we have a crusty crab during the day that transitions to Moe's Cantina Jazz Club at night. I think that would kill it. You went immediately to the fictional space, but that would be a heck of a vibe.

22:36The two restaurants that I want to see paired together, I want to go very different ends of the pricing spectrum. So you put a McDonald's in the same place as like a Nobu or some super, super premium brand. And then you start doing things like putting caviar on McNuggets, stuff like that. I don't know. I think that would be cool. I don't think you understand the process of synergy, the concept of synergy. That would be a crazy kitchen back there. You got the McDonald's fryer right next to, I don't know, very nice people making amuse boosh or something like that. Amuse boosh. Okay. Moving on. Finally, before we let you go about your Friday, let's preview the Academy Awards, which air on ABC Sunday night.

23:14The first thing you need to know about the Oscars is that the broadcast is moved up an hour from its typical time slot to 7 p.m. Eastern so that everyone can get to bed at a reasonable time. MLB and NBA, please take notes. The show, hosted by Jimmy Kimmel for the fourth time, has an extra buzz this year because for the first time in forever, it's highlighting movies everyone has seen. And of course, I'm talking about Barbie and Oppenheimer, which are both nominated for Best Picture. That could boost viewership because over the past decade, the Oscars have featured films that maybe are really good in an artsy way, but don't appeal to the masses.

23:50Every best picture winner over the past decade was made for under$25 million. And the top grossing of those winners, Green Book, brought in$320 million in ticket sales. For comparison, Oppenheimer brought in nearly$1 billion and Barbie grossed$1.4 billion. So I expect a lot of people to tune in. Yeah, it is kind of crazy to hear those box office numbers and that it's two of 2023's highest grossing movies pitted against each other as two of the favorites in the best picture category i mean even a few years ago that would have been avengers endgame versus spider-man far from home so you just don't consider the oscars as a place where these big box office movies do well but hopefully it leads to a rebound in viewership i mean viewership has fallen off a cliff it's less than half of what it was back in 2013 last year only 18.7 million viewers in the u.s tuned in.

24:40So I definitely think we're going to see a bump this year, though. Yeah. I mean, if Oppenheimer wins, it would be the highest grossing best picture since Return of the King way back in 2003. I know that probably brings a lot of memories back. But also for the Oscars preview, we got to talk about this gift bag that people get, the nominees get for Best Director and some of the top acting awards. So there's this gift bag that is put together, they have nearly 60 items worth over$170 ,000 with the most expensive of those gifts being a$50 ,000 trip to a luxury chalet in the Swiss Alps. And I guess these brands think it's worth it because, you know, if Robert Downey Jr.