NPR, PBS Funding Cut & CBS Cancels ‘Late Show with Stephen Colbert’

0:28This episode is brought to you by Progressive Insurance. Good morning, Brew Daily Show. I'm Neil Freiman. And I'm Toby Howell. Today, what will happen to NPR and PBS after Congress pulled funding for public media? Then Stephen Colbert is going to get an earlier bedtime because CBS is canceling The Late Show. It's Friday, July 18th. Let's ride.

0:52Good morning and happy Friday. If you've got a birthday coming up, sure, you can spend the day refreshing your Facebook wall and inviting friends for a dinner. or you could sprint manically around town trying to collect all the freebies retailers give out to people on their big day. The Wall Street Journal profiled one guy, Clint Svatos, who's part of a community of competitive birthday freeloaders. These people couldn't care less about your gifts. They care more about maximizing gifts from companies like a free Grand Slam breakfast from Denny's, handouts from Sephora or Ulta, and popcorn from Regal.

1:26In all, on his birthday earlier this year, Svato's broke a record with 40 freebies, including 10 free drinks, 14 free desserts, and 12 free food items. Toby, is this a respectable way to spend your birthday? First of all, this dude had it down to a science. Here's his smartest ploy, Target Shopping Centers, because they have multiple opportunities for freebies in one spot. He also paces himself. You know, energy is gonna be a big issue. So he schedules free coffee at intervals to keep his energy up. He's not alone either. Denny said that 28 % more people redeemed their birthday freebie in 2024 compared to the previous year.

2:01So clearly people are loving freebies. All that being said, according to the article, his wife won't go with him and his kids are kind of embarrassed he does it. So maybe just don't do this. Maybe just post on your Facebook wall instead. And now a word from our sponsor, Mortgage Matchup. Neil, do you want to save money? Yep. That's why I found a two-for-one deal to go to the zoo this weekend. Is this you inviting me? Well, actually, I was going to take my brother. Wow, I see where we stand. But to actually save money, there's a mortgage matchup powered by United Wholesale Mortgage. They can connect you with a mortgage broker.

2:36Brokers can help you save thousands of dollars. Their licensed professionals can shop on your behalf and give you access to more home loan options like conventional 1 % down purchase, VA loans, jumbo, and more. So check out MortgageMatchup.com to speak to a real home loan expert from the comfort of your own home. That's MortgageMatchup.com. Disclaimer, United Wholesale Mortgage LLC equal housing lender NMLS number 3038 licensed in all 50 states in the District of Columbia. For more than a half a century, the U.S. government has spent hundreds of millions of dollars each year helping pay for PBS, NPR and other public broadcasters across the country.

3:13Those days appear to be over. Last night, the House passed a measure that strips nearly$1.1 billion in funding for public media and President Trump is expected to sign it into law today. The spending cuts fulfill a decades-long push by conservatives to defund NPR and PBS. Spending, they've said, is unnecessary, wasteful, and fuels biased reporting in favor of progressives. So what's going to happen to NPR, PBS, your local public media, TV, and radio stations? It first helps understand how government dollars reach them, and it's a somewhat complex journey. Each year,$535 million in taxpayer money goes to the Corporation for Public Broadcasting, the organization set up in the 1960s to support local TV and radio across the country.

3:57The CPB then funnels more than 70 % of that money to about 1 ,500 local radio and TV stations in the U.S. Then, those local outlets pay NPR and PBS members dues and licensing fees for the rights to air shows like All Things Considered, Morning Edition, and PBS NewsHour. To review the flow, government, CPB, local stations, national organizations. It means NPR's mothership in D.C. gets only 1 % of its funding through direct federal grants and far more, about 30%, from its member stations sprinkled across the country. The rest is made up from donations, returns from its endowment, and corporate sponsorships.

4:34So NPR and PBS will suffer financially, but not nearly as much as the local stations, particularly in rural areas that are on the front lines of the funding pullback. If Trump signs the measure into place today, as expected, get ready to hear fundraising campaigns immediately. Yeah, you got some opposition along the way here, because as Republican Senator Lisa Murkowski from Alaska said in a speech on Tuesday arguing against this, these local stations are not just your news. It is for your tsunami alerts. It's your landslide alerts. It's your volcano alerts saying the important place that these stations occupy in smaller rural communities.

5:10Because you are right. Some of the bigger stations are going to be able to plug those funding gaps with other things, either by raising money or through sponsors. But these small rural shows are the ones that are under the most pressure when you start when you pull the rug of funding out from underneath them. A day after Murkowski said that in the Senate, there was a 7.3 magnitude earthquake off of an Alaska peninsula that triggered tsunami warnings on local public broadcasting stations. So kind of her words went into action just day after she testified in the Senate. The NPR did release a report back in 2011 warning of what could happen if Congress were to cut off funding to the public radio system.

5:55Again, this has been a threat looming over NPR and PBS for decades. NPR's internal report found that up to 18 percent of the roughly 1 ,000 member stations would close with Midwest, South and the West affected the most. And then nationwide, up to 30 percent of listeners would lose access to NPR programming. And that's because if this funding dries up to these smaller stations, then they're not going to have as much money to pay NPR and PBS for the programming that they put on their airwaves. So you might see a lighter slate of NPR news programs or other shows on PBS or NPR because of these funding cuts.

6:34And this is part of a broader rescission request, which is coming for the first time in more than 25 years. It's a little bit of a controversial political instrument to do this because you're actually clawing back money that's already been allocated by Congress, which is something that doesn't happen. I mean, it hasn't happened in a quarter century. So as part of this broader package, Trump wants to claw back about$9 billion in total spending. $8.3 billion is tied to foreign aid programs that fight famine, fight disease around the world. So clearly this was something that was the very finest of margins.

7:08It barely got through the Senate, barely passed the House last night, completely along party lines. And then if you zoom out to these$9 billion in cuts, a lot of opponents were saying that adds up to about one-tenth of 1 % of the$7 trillion federal budget, but has far-ranging impact for something like a rural station. That was some of the pushback we saw to these rescission requests from Congress. Last night, Stephen Colbert sat behind the same desk he has for a decade and told viewers that his show was coming to an end. No, he wasn't being replaced by a younger, snarkier host. The Late Show as a whole is going away next May due to what CBS called a purely financial decision.

7:50It's a pretty seismic shakeup for a show that's been on the air for 32 years, but has struggled recently along with the rest of late night TV. The genre has been fading in relevance for years now. As of 2023, revenue across the top six late night programs was down more than 60 % from its peak in 2016. Falling revenue is tough to swallow for networks because late night shows are expensive to produce. According to Axios, top hosts like Colbert and Jimmy Fallon are making north of$15 million per year, while The Late Show employed nearly 200 people. One other factor in Colbert's departure might be related to Paramount's pending$8 billion merger with Skydance Media that requires approval from the Trump administration.

8:30Colbert had expressed his frustration with the$16 million settlement CBS paid to Trump to settle a lawsuit tied to 60 Minutes coverage of him, a settlement that also led a longtime producer Bill Owens to resign, citing a loss of editorial independence. Neil, it feels like the rug was pulled out from what was typically the highest rated show in Late Night. Right. CBS executives wanted to stress that this was, quote, a purely purely a financial decision against a challenging backdrop in Late Night. They also added it is not related in any way to the show's performance, content or other matters happening at Paramount.

9:05And that seems to be a wink and a nod to that settlement that Colbert called a big fat bribe. On the one hand, you can see why this is an understandable decision. And on the other, you can see why it's a bit puzzling. The understandable part, as you mentioned, revenue for late night shows has been cut in half over the past eight years. If you look at the Emmys, Emmy nominations that we just talked about a few days ago, the number of late night shows that were nominated was three, Kimmel, Fallon and Colbert. just a few years ago, there were six. So you're starting to see the pie shrink. So those are the reasons.

9:40And as you mentioned, these shows are very expensive to produce and they're bringing in a lot less money. Now, here are the reasons to be a little bit puzzled. Colbert was the top late night show on the market. So even in this smaller pie, he was the top dog. And then in other instances where networks have canceled late night shows, they've done it with a big shebang. They've announced it at the upfront weeks in front of advertisers, because if you know this is going to be the last season, then you want to squeeze as much juice as possible. So when Johnny Carson left The Tonight Show on NBC in 1991, that was in a huge presentation to advertisers.

10:19David Letterman did the same when he left The Late Show on CBS. Yes, it was a huge celebration and announcement in front of advertisers so they could spend as much money in the final season as possible. So because of those reasons, TV executives say perhaps this was a hastily made decision. Yeah, but the writing's been on the wall because for a long time, these late night shows were the cash cows of the network because they were the ones bringing in the younger audience. They were relatively inexpensive to produce. They had a larger ad load compared to primetime TV. but now that is entirely the opposite of what they are.

10:55They have an older audience. They're not getting the desirable viewers that advertisers want. All those desirable viewers are actually watching on a YouTube. And if you look at these late night shows, YouTube channels, they rip views, but it's just not as lucrative. And you can't justify the production expenses when you're only getting YouTube views. So it's totally switched because the cultural cachet has shifted to YouTube and TikTok and away from these late night programs. We kind of saw a similar thing go down yesterday in the sports media landscape as well. Fox signed a deal with Barstool to bring their cast of carriers onto their pregame show, replacing some recognizable athletes in the process.

11:33It's the same thing, trying to tap into more culturally relevant faces and distribution models. Sports media is trying to survive. Late night is going to have to find a way to survive and adapt as well. Moving on, last week I went to see the new Jurassic Park movie in theaters and I got goosebumps. not because the dinos were especially hair racing, but because right before the movie started, a trailer for Christopher Nolan's adaptation of The Odyssey came on, and boy, does it look good. But a trailer for a movie that comes out next summer in 2026 feels a bit early, right? But Nolan didn't just stop at trailers.

12:07He and Universal actually put tickets up for sale a year in advance of opening night, something that has just never really been done in the movie industry. They came with a caveat too. Tickets will only be available at movie theaters with 70mm IMAX screens. For Nolan lovers, that comes as no surprise. The man behind the Batman movies, Interstellar, Oppenheimer, and more is obsessed with IMAX in its gold standard 70mm format. In fact, the Odyssey will be the first movie ever shot entirely on IMAX cameras, an achievement made possible only after Nolan hounded the company for smaller, lighter models, which IMAX was happy to provide given all the money Nolan brings in.

12:47Of the nearly billion dollars Oppenheimer gross, 20 % came from IMAX screens. And it's not just a Nolan thing either. Apple secured some IMAX cameras for its F1 movie and brought in a quarter of domestic ticket sales from the format so far. Neil, IMAX screens make up less than 1 % of total movie screens worldwide, and yet they are responsible for major portions of big box office halls. This format and this company are on fire. Let's talk about the ticket sales that resemble something like Oasis or the Ares Tour. I walk in here yesterday morning. The first thing you show me, you go, IMAX is sold out for the Odyssey.

13:25And I was like, when's the Odyssey? You're like, a year from now. And these tickets were going nuts. They were very hard to find. And then, of course, a secondary market has popped up. Some prices for one seat was going upwards of$200. They're selling someone was selling a package of four Saturday tickets for the AMC Lincoln Square in New York City Starting at one thousand dollars. There are not a lot of IMAX seats There are a lot of people clamoring to get seats for this movie Having no idea what their schedule is going to look like a year in advance So there was an absolute it was absolute pandemonium for these IMAX seats and for for the Odyssey a year in advance and you can see why, as Christopher Nolan and IMAX is a match made in heaven.

14:10Yeah, and it's just something that has a rising tide floats all boats situation because IMAX's CEOs are just happy to do whatever Christopher Nolan wants because this company has been ripping recently. Consumer tastes have just shifted towards that premium experience. We keep talking about how you have to differentiate the experience from just sitting at home with a buffet of movies at your disposal from streaming services. How do you do that? just make it an immersive surround sound, a giant screen, this crazy 70-millimeter format as well. The CEO of IMAX is forecasting$1.2 billion this year at the global box office.

14:48That is 33 % higher than last year. It would be a record. And shares of the company are up 60 % over the last 12 months. It is just a crazy company that is bucking every other trend in the movie industry and doing much better than its peers. Meanwhile, the other movie theaters chains are like, well, how do we combat this? They have a weird frenemy relationship with IMAX because they pay IMAX a licensing fee to have its technology at their movie theaters. But they're saying, hey, maybe there's a more profitable way. So a bunch of these companies like Cinemark, Regal and Marcus are huddling up together in backroom saying, OK, how can we sort of channel what's going on in IMAX and also make it best for us?

15:27They are thinking about jointly marketing their premium large screen formats, which don't rise to the level of IMAX, which has spent 55 years perfecting this technology. But they're thinking of maybe creating an umbrella brand that makes it easier for consumers to say or to just look at something and say, OK, that is the IMAX equivalent for these other companies. And that's their way of seizing on this trend. It makes sense, too, because Cinemark calls their big screens XD, Regals are called RPX, and Marks's are called MT-X. First of all, not the name recognition of IMAX at all, and also just horrible naming formats in general.

16:03So I actually do think they have a branding issue here. So they're behind the eight ball. It's a big, tastic catch-up to IMAX, especially because IMAX has this camera monopoly that it's building. All the filmmakers want to use IMAX cameras right now because they say this is the best way to view my product. Christopher Nolan's obviously the biggest one, but Ryan Coogler of Sinners talked about his love for the format as well. The F1 movie, Mission Impossible. These were all movies that made uses of these cameras as well. So IMAX both has the consumer side of it, but also has filmmakers on their side.

16:36So gonna be tough to dethrone. All right, up next, we have Stock of the Week and Dog of the Week. Welcome to Stock of the Week, Dog of the Week, the segment where Toby and I pick one stock that was a sky full of stars, and the other will try to fix you. I won the pre-show attend a Coldplay concert without anyone noticing contest, so I get to go first. My Stock of the Week is Lucid. Remember this company? Last week, you heard on the show it set the world record for longest EV drive on a single charge, and it's earned a spot this week after inking a massive deal with Uber for self-driving cars. Lucid's stock jumped 36 % yesterday after Uber said it would invest$300 million in the electric vehicle maker and commit to buy at least 20 ,000 vehicles for an upcoming robo-taxi rollout.

17:23With a 5 % stake, Uber is now Lucid's second biggest shareholder after the Saudi Public Investment Fund, which is also a major shareholder in Uber. The deal also involves Uber investing in another company, Neuro, which is going to supply the autonomous software that'll transform Lucid's SUVs into self-driving robot machines. Lucid and Neuro are one of more than a dozen partnerships that Uber's inked with companies as it aims to become the platform of choice in the fast-growing robo-taxi market. Uber once tried to develop self-driving tech in-house, but it's decided that linking up with automakers like VW and software companies like Waymo is a more profitable and honestly easier path forward.

18:01As for Lucid, its stock is still down 94 % from its 2021 peak when it was somehow worth more than Ford and General Motors. Still, Uber's 20 ,000 car commitment and the 300 million marks a vote of confidence for one of the few pure play EV companies in the US. Yeah, this is great for Lucid because they have had a tumultuous couple of years. They racked up $6 billion in net losses from 2023 to 2024. Their CEO and founder unexpectedly stepped down last year. And yeah, its stock is down just oodles and oodles from its peak in 2021. The PIF, the Saudi Investment Fund, also is breathing a sigh of relief here too because they own 58 % of the company now.

18:45They put another$1.5 billion. They put in$8 billion into this company in total. Its stake is only worth about$4 billion at this point. So to see a brand name like Uber come in and do this minimum vehicle promise. It is something that you feel like some momentum is building at this company that has had a rough go of it recently. And momentum is building for Uber. Free cash flow doubled last year to$7 billion, freeing up some money. It wasn't profitable for forever. Now it is very profitable and it can spend on going on offense in the autonomous vehicle arms race, which is absolutely heating up.

19:22When you think robo taxis and the rollout of these things. You probably thought that this would be an existential threat for Uber with its human drivers and the fact that it couldn't develop autonomous driving in-house. That was an abject failure during its previous management. But it's been inking all of these deals with Volkswagen, with Waymo, with other software and hardware and automakers to be the consumer-facing aspect of their self-driving apparatus, their ecosystem, and it's been super successful. This is another step for Uber turning what could be a liability into an advantage. My dog of the week dates back to a story we briefly touched on yesterday, and that is high fructose corn producer Archer Daniels Midland, aka ADM.

20:10Shares fell nearly 7 % yesterday after President Trump announced he had urged Coca-Cola to start using real cane sugar in their drinks sold in the U.S. Another major sweetener supplier, Ingredion, saw their shares dip 7 % as well. Both stocks soon pared back most of their losses after Coca-Cola failed to explicitly endorse the plans laid out by Trump. But still, the announcement has the industry on edge because Coca-Cola is one of the biggest purchasers of the sweetener dating back to the 1980s. ADM's stock dip is symbolic because this is a company synonymous with corn. Former CEO Dwayne Andreas called the company the supermarket of the world back in the 80s.

20:49A growing portion of politicians in Washington, though, have been lobbying to get high fructose corn syrup out of our foods, which is going to be an uphill task. Thanks to a combination of powerful government subsidies that total$10 billion annually, support from the meat industry that needs corn, and protectionist tariffs on cane sugar, HFCS, as it's called, is not going away anytime soon. Neil, America is really a country dominated by corn, so it's not going to let a big customer like Coca-Cola go away easily. Quite an interesting reaction here from the Corn Refiners Association. The corn lobby made themselves heard after Trump announced that they would be moving away from high fructose corn syrup, which to stress once again, we don't know if that's actually going to happen.

21:35We had the group's president, Corn Refiners Association president, saying replacing high fructose corn syrup with cane sugar doesn't make any sense because it would hurt jobs around the country. About 90 million acres of land, which is larger than the entire area of Greece, is used to produce corn in the U.S. every year. About 8 % of all of that land is used to produce corn sweeteners, say experts. And when you're looking at 90 million acres, 8 % of that, that's a big chunk. That's what the corn lobby, which has had a very muscular presence in Washington, in D.C. for decades is saying what could be lost should Coke, a major purchaser of corn syrup, go away.

22:15Let's talk about the nutritional side of things because that's where a lot of pressure on high fructose corn syrup is coming from. Nutritionally, there's not a ton of meaningful difference between high fructose corn syrup and cane sugar. Both are made of glucose and fructose. They are basically chemically identical. They have essentially the same amount of calories as well. And then also the taste aspect, which is probably where a lot of fans of this decision are coming from. In blind taste tests, HFCSs usually win. This very in-depth study from 2023 did a blind taste test with canned cola from America facing off against bottle coke from Mexico made with cane sugar.

22:5488 % of taste testers chose the American high fructose corn syrup coke, but 85 % preferred the packaging of the Mexican coke. So maybe what you are thinking is a better tasting Coke out of a bottle, a better tasting mixing Coke that uses cane sugar is really just because it's out of a glass bottle and you like the form factor more than you like the can of American Coke. So very fascinating psychological aspect to this as well that maybe cane sugar actually doesn't taste as good as we all think it did. Somehow Coke's earnings just became the most interesting earnings on the calendar. It's happening next week.

23:30I think everyone's going to tune in to see what they say about whether they are truly going to be abandoning high fructose corn syrup in their American manufacturing process. I know these guys at the Corn Refiners Association will be absolutely glued to their seats. OK, let's sprint to the finish with a final headline. British youth will soon have a new reason for skipping school to go vote. The government announced yesterday that it would lower the voting age from 18 to 16 by the next national election, joining a small group of countries, including Austria, Brazil and Ecuador, that allow pimples at the polling stations.

24:03The Labour Party, which is currently in power, says lowering the age is aimed at bolstering democracy by getting citizens hooked on voting from an early age, hoping that they'll carry the habit with them as they get older. Plus, many 16 and 17 year olds work and pay taxes. Prime Minister Keir Starmer said if you pay in, you should have the opportunity to say how your money should be spent. Just as a point of comparison, the U.S. lowered the minimum voting age from 21 to 18 in 1971, partially due to public outcry that men as young as 18 could be conscripted into the Vietnam War but couldn't vote.

24:36Yeah, one of the aspects of this, too, that Britain is worrying about is just participation in elections in general. turnout in the 2024 general election was under 60 percent. That was the lowest since 2001 and down almost eight percent from the previous election in 2019. So if you're looking at a representative democracy and no one's turning out for vote, that is a bad thing because that means that a lot of people are not having a say in their governors and in the rulers. And so how do you expand the voting pool, make pimples come to the polls, as you put it? This has happened before The last time that the government expanded the voting pool was in 1969.

25:18That was also implemented by a left-leaning Labour government at the time, who then lost the subsequent election. So if you're wondering if this is just a political ploy by the Labour Party to get more voters to support them into the voting pool, it didn't work necessarily last time it happened. Right. Polling of 500 people in Britain aged kids aged 16 and 17 showed that labor had the most support with 33 percent. Reform UK had 20 percent. Conservatives had 10 percent. But half of those people thought they should not be allowed to vote in the first place. So self-awareness. Self-awareness. All right.