Boeing Whistleblower Testifies & Tesla Wants to Give Elon $56B Payout

0:00Does it ever feel like you're a marketing professional just speaking into the void? But with LinkedIn ads, you can know you're reaching the right decision makers, a network of 130 million of them, in fact. You can even target buyers by job title, industry, company, seniority, skills, and did I say job title? See how you can avoid the void and reach the right buyers with LinkedIn ads. Spend$250 on your first campaign and get a free$250 credit for the next one. Get started at linkedin.com slash campaign. Terms and conditions apply. Good Morning Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell.

0:35Today, Kaitlin Clark's shockingly low WNBA salary has sparked a debate over pay equity in sports. That Dubai has received double its average annual rainfall in a freak storm over the last two days. Is cloud seeding to blame? It's Thursday, April 18th. Let's ride.

0:56Word of advice, kids. Do not bet on a sport you play professionally or you're going to have to learn a new sport. Yesterday, the Toronto Raptors' Jontay Porter was banned from the NBA forever after the league found that Porter bet on NBA games and limited his participation in at least one game to influence the outcome of a bet. In one of the most striking examples, a better found out through Porter that Porter had a health issue going into a game, so the better dropped$80 ,000 on a parlay for Porter to underperform across a variety of metrics. Sure enough, Porter left the game three minutes in with an illness, and the bet cashed out$1.1 million.

1:37Well, the bet wasn't paid because DraftKings noticed something was off and flagged to the league. The league has partnerships with more than two dozen betting and gaming companies at this point. So, of course, this just throws into light the hypocrisy of getting into bed with these gambling companies and then punishing players so severely. It's wild to see how fully the league has embraced gambling at this point. I remember the days when commentators would treat it almost like Lord Voldemort, where they would allude to Vegas or something like that about a meaningless three-pointer at the end of the game.

2:08But now you can just speak about it openly. The logos are plastered all around the court. So it is just crazy to see the evolution of how the league has embraced gambling. You think this is too severe of a punishment? I don't think it's too severe as a punishment, but you've got to admit that it's a bit— there is a level of hypocrisy here of if you are taking money from these gambling companies and then you have these players losing their entire livelihoods over it. I'm not saying that Jonte Porter, what he did was correct or anything like that, but it is interesting to see DraftKings and FanDuel be the primary sponsors of these leagues, and yet the players still face the ultimate consequences.

2:44Now let's hear a word from our friends over at Robinhood. One of my favorite investing strategies is a set-it-and-forget-it approach to the market. I'm great at the set-it part. The forget-it part, a little harder. Oh, you're a chart fiend, Neil. I see you over there checking in daily, but I recommend you check out some of the many tools Robinhood offers to automate your personal long-term strategy. Hey, I like to see what's happening, okay? But fine, what are these tools? I'm talking recurring deposits, which automatically move money into your Robinhood account on a schedule, recurring investments to allocate a certain amount of your money towards buying stocks or ETFs, and you can do it all weekly, bi-weekly, monthly, or even further apart.

3:21Set it and forget it, Neil. I'll still be checking my charts, but I like the perspective. Hey, you do you, man. Learn more about the Robinhood app in the App Store or Google Play Store. Disclosures, investing is risky and returns are not guaranteed. Recurring investments do not ensure a profit or guarantee against a loss. Not all securities on Robinhood are eligible for recurring investments. Robinhood Financial LLC member SIPC is a registered broker dealer. This episode is brought to you by State Farm. Checking off the boxes on your to-do list is a great feeling. And when it comes to checking off coverage, a State Farm agent can help you choose an option that's right for you.

3:59Whether you prefer talking in person, on the phone, or using the award-winning app, it's nice knowing you have help finding coverage that best fits your needs. Like a good neighbor, State Farm is there. Dubai and the United Arab Emirates is dry. It typically receives around 3.9 inches a year of rainfall on average, but in just over 24 hours, starting on Monday, about 6 to 10 inches of rain have fallen on the city. It's the heaviest rainfall it's seen in over 75 years, and it's predictably led to chaos. It's shuttered the second busiest airport in the world. Rolls Royces and Aston Martins are floating in the street, and 19 people have died from flooding in neighboring Oman.

4:42amid the chaos you may have seen people speculating about the origin of this freak weather event cloud seeding bloomberg news suggested the link as the storms began to rage on monday cloud seeding is this form of weather modification to try to address water security issues the idea is to release salt or silver iodide into warm weather clouds with the intention of creating larger droplets that will eventually lead to rain there were reports that seeding planes had been dispatched on Monday before the storms, but the UAE's National Center for Meteorology later denied that. Neil, cloud seeding and geoengineering in general are hot button issues that divide the scientific community.

5:19And this once in a generation storm has put the practice squarely back in the spotlight. Absolutely. It feels like this is a futuristic technology that they've only been doing for a few years now, very experimental. But if you actually go back through the history of cloud seeding. It goes back decades. It started in the 1940s when farmers, ski resorts, hydropower companies in the United States sent planes and sent particles up into the clouds to induce more precipitation. It's not hard to see why a ski resort might want to do this to induce more snowfall. And they still do it. I mean, Vail Resorts pioneered it, and they have a very robust cloud seeding program.

5:58Telluride also does it, Wolf Creek in Colorado, Park City in Utah, Alta. So they all have very robust cloud seeding programs. Back to the UAE, it's very interesting. There was a little discrepancy because initially they said they did cloud seeding on Sunday and Monday and Tuesday, and then they walked it back a little bit and said, no, we haven't done cloud seeding operations. But at the most, it feels like cloud seeding can only induce a 20 % increase in rainfall. So I think the consensus here after much debate is that cloud seeding, if it had anything to do with the rainfall, was very minimal.

6:32Yeah, minimal. Let's dive into the debate around this practice, though, because you're right. It has been around for a long time. On the one hand, you might think that clean tech and reductions in greenhouse gases aren't happening quickly enough. So no option should be off the table, even if it comes to meddling with the weather a little bit. But on the other hand, there's this distinct lack of regulation around cloud seeding. There could be these unforeseen side effects. And it might just be a distraction from the broader shift that we need to make away from fossil fuels and towards renewable energy.

7:03So there's definitely people, even within the environmental movement, even within like the clean tech industry that are very divided on cloud seeding, because you're also correct, it's a mixed bag on if cloud seeding even works, because especially in flat regions, and especially on clouds that aren't close to producing rain anyway. A lot of people think that some city officials may overstate the effect cloud seeding have to show that they are making strides and trying to induce rain in this arid region. So it's definitely a mixed bag and is splitting the scientific community a little bit. The bigger problem for Dubai is not cloud seeding or the debate over that.

7:41It's really, do you have the infrastructure to handle these floods? Because Dubai is really way more of a concrete jungle than the United States is. It doesn't see a lot of rainfall. They don't have a lot of permeable surfaces. There's a lot of concrete. The rain, when it comes down and when it comes down heavy, is not going anywhere, which is why you saw the Dubai airport literally underwater. It was a lake. 500 flights were canceled. That's chaos. So many flights go in through Dubai and around the world. So I think Dubai has to address its infrastructure. And other cities that are going to be seeing more extreme rainfall events or more extreme weather events, You have to have your infrastructure ready to handle these these kind of things.

8:20Boeing was in the negative headlines once again as whistleblowers testified on Capitol Hill that the company was knowingly producing planes that had safety defects and retaliated against workers who brought up concerns. The star witness at this hearing was 17-year Boeing vet Sam Salipour, a quality engineer who warned that the 787 Dreamliner was not safe to fly due to gaps where the different pieces of the fuselage came together. He also said that when he raised the issue with his superiors, he was harassed and verbally threatened and a bolt had been driven through the tire of his car, though it wasn't clear who did it.

8:56Another whistleblower at the hearing, a former Boeing manager, went even further, accusing Boeing of a criminal cover-up following the door panel blowout of the Alaska Airlines 737 MAX in January, the incident that renewed scrutiny over Boeing. For its part, Boeing says that concerns about the 787 are inaccurate and it's fully confident in the plane. Still, the hearings revealed even more rot in the company's culture than we knew about. Yeah, Salipour has been on a media tour since he came forth with his whistleblowing allegations last week. He jumped on camera for the first time, even before the hearings, and said that he said the plane could fall apart and drop to the ground mid-flight if the issues were not addressed.

9:34When he asked if he would put his own family on a 787 right now, he said, right now, I would not. And he reiterated that the company has not addressed these tiny gaps found in multiple planes after they weren't put together correctly. So it's definitely we're seeing the fallout from we got those initial claims. Now he's going on Capitol Hill. Now he's going on TV. And the heat is still being turned up on Boeing. What struck me the most about his testimony was the retribution aspect, the fact that when you raise concerns that his superiors kind of berated him, he said that he had a call with his boss for over 40 minutes where he was lashed by his boss over raising problems.

10:13And the ability of whistleblowers and regular employees to come forward with safety issues is a really big part of what makes manufacturing safe. The FAA has developed this whistleblower process for workers at Boeing and other aerospace manufacturers to come forward with issues. Because the fear, the ability to come forward and not fear retribution by your superiors is a really part of developing that safety culture. So the fact that he said he was harassed and verbally threatened by his superiors is certainly concerning. The other thing that is very concerning, too, is the other whistleblower that you mentioned came forward and said that there's an attitude problem both at Boeing and the FAA itself.

10:54And he said right now the attitude is that Boeing dictates to the FAA, not the other way around. So you don't want these regulatory agencies being kind of at the mercy of what these big companies are. And certainly right now, it seems like the power balances between those two are off and they should be recorrected so the FAA can monitor Boeing appropriately. When at first you don't succeed, try again at a shareholder meeting in June. That's the approach Tesla is taking towards getting Elon Musk's historic$56 billion pay package approved. If you rewind to three months ago, a Delaware court voided Elon's monster pay package that Tesla's board and shareholders had granted him back in 2018.

11:36The judge described it as deeply flawed, saying the company hadn't properly disclosed the package to shareholders and that Elon wielded far too much control over the board. But yesterday, Tesla said it would go to bat again for the package and is bringing it to a shareholder vote at its annual meeting in June. Since the package is entirely made up of stock options, it's only worth$47 billion now given Tesla's recent struggles. And given that underperformance, Musk might be facing an uphill battle in his attempt to get rewarded with the richest pay package in US corporate history. So as shareholder meetings go, Tesla's June 1 is up there with the most dramatic because everything from a happy Musk to a Tesla-Musk breakup is on the cards.

12:17Yeah, seriously. But Tesla does think that it has the support for this pay package needed to go back Back to that particular vote and have it go through. They did originally back in 2018. They got 73 % of non-MUS shareholders to approve the plan. They put a lot of evidence forward that a lot of the shareholders still support the fact that MUS should be paid tens of billions of dollars for bringing Tesla from a$50 billion valuation to a$500 billion valuation. It says it has four of the largest institutional shareholders in the company on board. That includes T. Rowe Price, which they said urged Tesla after that pay package was voided to go back and hold another vote because they want Elon to be paid this amount for hitting these particular benchmarks for Tesla.

13:03Right. And you might be thinking, why is it going to bat for this particular pay package? Why not just throw it out and start again anew? But they are going the route of ratification because trying to get the previous deal improved instead of trying to negotiate a new package with Musk honestly might be the play because you're going to have to pay him a similar magnitude package no matter what. So you might as well just use the one that's already been seen to have support from shareholders rather than trying to craft a new agreement where Musk might have even more leverage over the company at this current moment.

13:35But it's actually a very interesting moment for Tesla right now because Elon has publicly said, I want more control of the company. I want to get up to that 25 % ownership threshold. So we might see some fireworks come June where Elon just says, listen, you guys are putting me through this rigmarole. I've been basically working for free. I haven't exercised hardly any of the stock options. I'm legally allowed to. He might just - I'm bleeding money from X. Right, yeah. He's spending a lot of money on his social media side project. So I could totally see this whole thing blowing up in Tesla's face, or maybe they just voted through.

14:10Yeah, we'll see. It should be pretty dramatic. Also, that's not the only vote that's happening at this meeting. Tesla will also vote to reincorporate from Delaware to Texas. Elon Musk, after that Delaware decision, to void his pay package really kind of went after him. Yeah, went ham on on Delaware and said, I don't want to incorporate in you anymore. And I want to move all of my companies to Nevada or or Texas. So it feels like Tesla Tesla may also vote to shift its place of incorporation. President Biden and his rival Donald Trump don't have a lot in common, but they do agree on one thing. Steel coming from China should face higher tariffs.

14:49In a speech in Pittsburgh, home of the Steelers, Biden called on the U.S. trade representative to more than triple some tariffs on steel and aluminum products coming from China. In this proposal, certain goods that have tariffs of 7.5 percent or none at all could face a 25 percent tax to enter the U.S. market. The call for higher tariffs is in line with Biden's aggressive push to get that made in America tag on more products. And that push has come with a hard line against China. In recent weeks, officials across the West, not just the U.S., have accused Beijing of dumping its extra exports into foreign markets at low cost, hurting local manufacturers who can't compete on price.

15:29But as Biden puts up trade barriers, economists have concerns that these protectionist policies may come at a cost to free market ideals and global economic growth. Yeah, Biden talked about this while on the visit to a swing state. He's definitely on the campaign trail right now, rolling out these protectionist steps against Beijing. There's also tariffs that he wants to include against electric vehicles, batteries, solar products, which you've heard us talk about on the show in the past. It is interesting, though, because technically the 7.5 % tariffs have worked a little bit. In 2023, steel imports from China were down 8.2 % from 2022.

16:05And if you look at the broad import volume that the U.S. does, by comparison, we don't actually import that much steel from China, 598 ,000 tons in 2023. Compare that to imports from Canada, 6.9 million tons. Imports from Mexico, 4.2 million tons. But then if you dig a layer deeper, a lot of people think that Chinese companies are setting up shop in Mexico, avoiding those tariffs and importing through Mexico. So the whole import scene for steel is particularly interesting. And the tariffs that are being applied to it will only make only constrain it even more. Up next, you better get excited because my favorite time of the week is here.

16:46Neal's numbers. Change is always happening. but no matter what changes in five years there's one thing that will stay the same the price of your internet with the xfinity five-year price guarantee you get five years of the most reliable wi-fi with our best equipment included for a price that stays exactly the same restrictions apply new residential customers only taxes and fees extra and subject to change most reliable wi-fi based on open signal awards usa fixed broadband experience report august 2024 eczema isn't always obvious but it's real and so is the relief from ebglyss after an initial dosing phase about four in ten people taking ebglyss achieved itch relief and clear or almost clear skin at 16 weeks and most of those people maintain skin that's still more clear at one year with monthly dosing ebglyss libri kizumab lbkz a 250 milligram per two milliliter injection is a prescription medicine used to treat adults and children 12 years of age and older who weigh at least 88 pounds or 40 kilograms with moderate to severe eczema.

17:49Also called atopic dermatitis that is not well controlled with prescription therapies used on the skin or topicals or who cannot use topical therapies. EBCLIS can be used with or without topical corticosteroids. Don't use if you're allergic to EBCLIS. Allergic reactions can occur that can be severe. Eye problems can occur. Tell your doctor if you have new or worsening eye problems. You should not receive a live vaccine when treated with EBCLIS. Before starting EBCLIS, tell your doctor if you have a parasitic infection. Searching for real relief? Ask your doctor about EBCLIS and visit ebglis.lily.com or call 1-800-LILY-RX or 1-800-545-5979.

18:21Welcome to Neil's Numbers, the segment where I share three stats from the week's news that will give you so much cognitive energy you won't need any coffee this morning. My first number is 116, which is the name of a bus route in Barcelona that has vanished from the map but still exists. Here's the story. The residents of a Barcelona neighborhood have been kvetching for years that tourists are overcrowding a bus that goes to a famous park, the city's second most popular attraction. Complaining that not even elderly people with canes can find a seat on the bus, they decided to do something about it.

18:56The city council asked Google and Apple to remove the bus route from their map apps, and the companies agreed. So now the bus only exists for those who know about it. Barcelona literally wiping itself off the map is perhaps the most extreme example yet of the city trying to curb over tourism. Barcelona received over 20 million visitors in 2019 compared to its population of 1.6 million. COVID shrank that number, but tourists are trickling back and Barcelona does not want to return to being a playground for American study abroad students again. I feel like Barcelona may have Barbra Streisand themselves.

19:32Remember the Streisand effect is when you attempt to conceal something you end up drawing more attention to it barbara famously did that there was this uh her she wanted her house deleted from this series of coastal photographs she pressed legal action against the photo photographer and it led to a huge increase in people looking at her house i feel like barcelona just did this on the 116 bus route because now it's in the news we're talking about it and people are still going to know about it even though they deleted it from what i understand this bus was already extremely crowded it was so packed the there are a ton of tourists that go to barcelona So maybe you're right at the margin.

20:06I know a lot of people who listen to this are going to Barcelona. But no, it seems from what I gathered about this bus and talked to people who have been on it and head to this park, it is just bursting with people. And it makes sense that the people who live there are pushing back because they can't just have any peace and quiet in their neighborhood. And this is not the first step we've seen taken towards over-tourism at all. I mean, we talked about a Vermont town that essentially closed down the town during leaf season because of overcrowding. There's been staircases removed in Hawaii in popular photography spots.

20:37So this is not the end of the push against over-tourism that these countries are doing. And it's especially happening in Barcelona. They voted against expanding their airport because they don't want more people coming. And some of the steps that they've taken is on tours of the city. You can no longer have a megaphone and you have to put in a headphone and speak into a microphone there. All right, my second number is$68 million, which is the amount of change that Americans throw away every year. The source of that stat is a firm named ReWorld, and it would know. This Pennsylvania company processes waste and has collected at least$10 million worth of coins from your trash cans, according to the Wall Street Journal.

21:17The critics of coins, all of this change is cause for change. The U.S. quarter had roughly the same buying power in 1980 that a dollar has today. and pennies cost about three times their value to make. So at the very least, some argue that the U.S. should follow the lead of Canada, New Zealand, and Australia and remove our one cent pieces from circulation because no one is using them. Yeah, they're as good as junk for a lot of people. I mean, buses, laundromats, tollbooths, these places that historically you need to change for, they all take credit or debit cards at this point. And you're right, like the penny doesn't make sense economically.

21:52TSA also finds a ton of coins at checkpoints every year. So people are not using their change as they once were. And honestly, it made me extremely jealous that I never thought about a waste removal process where you process the amount of coins you find because they're making a – it's a small part of their overall revenue. But they're making a significant amount of money off this. Did you ever do this? Like I had a small similar operation with my grandma. We'd all sit together at the table, go through the coins that we had left in our piggy bank, roll them up, and then take them to the bank. It would be like$50 to$60.

22:24It was a nice little – Nice little gift. It's fun. The personal coin counter, you feel wealthy. That's the first time you feel wealthy is putting them all, having them store it and making those little rolls. All right. My last number is$76 ,535, which is what Caitlin Clark will make in her first year playing for the Indiana Fever in the WNBA. Not exactly a salary fit for a transformative basketball superstar, right? Doesn't seem so. It's less than 1 % of the$12 million, her number one draft pick counterpart in the NBA, Victor Wenbanyama will make this season playing for the San Antonio Spurs. This huge pay gap has sparked loads of debate this week, with even President Biden weighing in that women athletes are not paid their fair share.

23:06There are several reasons why salaries for WNBA players are so much smaller than what NBA players make. First of all, the WNBA brings in a tiny amount of revenue compared to the NBA, $200 million versus$10 billion each year. But even so, the way the collective bargaining agreements work, WNBA players receive a far less share of league revenue than the men who get 50 % of all ticket sales and broadcasting rights. Toby, Caitlin Clark making 70K. Something feels off. Yeah, something definitely feels off. And you're right. You can always point to the amount of revenue that each league respectively brings in.

23:40But the collective bargaining agreements are set up differently. The women do receive less of the overall total pie. So that's what they've been advocating for for years. is like, we just want to have the same part, piece of the pie that the men get. We know our pie is smaller, although it certainly is going to break. It's getting bigger. The next collective bargaining agreement can be agreed upon in the 2025 season. And I feel like we're going to see a much different landscape. All these stars are entering the league. Kaitlin Clark is entering the league. So hopefully it changes when it comes up for negotiation again.

24:13Yeah, and it all ties back to how much money they get on their TV deals because that is the lion's share of the revenue for these leagues. The WNBA currently brings in$60 million a season from their TV contracts with ESPN, CBS, et cetera. The NBA makes$2.7 billion annually from their TV contracts. So that's such a huge discrepancy. If viewership goes up for the WNBA, which we're all expecting it to, then the league can go back to the table with these media networks and say, hey, you have to pay us a lot more because we're bringing in a lot more eyeballs. It's a good thing robots don't get jealous or else Boston Dynamics would have a very awkward situation on its hands.