Are the Boys Lost? With Scott Galloway

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1:32Hello, I'm Anthony Scaramucci and this is Open Book, where I talk with some of the brightest minds out there about everything surrounding the written word, from authors and historians to figures in entertainment, neuroscientists, political activists, and of course, Wall Street. Sorry, I can't resist. Before we get into today's episode, if you haven't already, please hit follow or subscribe wherever you get your podcasts and leave us a review. We all love a review, even the bad ones. I want to hear the parts you're enjoying or how we can do better. you know I can roll with the punches, so let me know.

2:06Anyways, let's get to it.

2:15From technology and business to society, political debate, and higher education, my guest today, Professor Scott Galloway, can talk to it all. Young people, particularly young men, are facing a crisis, and it's one we must address before it's too late. Professor Galloway is someone that is always on point with his knowledge and advice. So let's listen to what he has to say.

2:44I'd like to take a second to recommend my friend Andy Ostroy's great podcast, The Back Room. Every episode is a fun, incredibly honest take on our society and the political situation, along with some brilliant guests. I've been honored to join Andy on the show, and you know anywhere that accepts me with no filter deserves a shout out.

3:10So joining us now on Open Book, Scott Galloway. Professor Galloway is obviously a NYU professor, serial entrepreneur, bestselling author, among many other things, podcaster, brilliant thought leader for us here in the United States. But the title of his new book, bestseller. It's called The Algebra of Wealth. I had the opportunity to read this book over the summer, Professor, and I enjoyed it. And so before we get to the book and some of the other things, like your recent TED Talk, just for some viewers that may not know you, which I think is remote, but I think it's important for people to know your background, where you grew up in California, how you got into the businesses that you got into, and why you became a teacher.

3:52Sure. So my backstory is pretty unremarkable. Raised by a single immigrant mother who lived and died a secretary here actually in Westwood. California taxpayers really lifted me up. I got into UCLA with pretty unremarkable grades, but I didn't test well either. When I applied to UCLA, Anthony, the admissions rate at UCLA was 76%, and I was one of the 24 % that didn't get in. And I was actually installing shelving in the Inland Empire. And the highlight of my day, literally was in a closet all day. The highlight of my day was I would get ridiculously high with my coworkers and then take to the highways of Los Angeles.

4:26And I said to my mom, you know, is this it? So I was very upset. And she said, well, let's see if there's an appeal process. I appealed. And I remember the admissions officer called me and said, you're not qualified, but you're a native son of California. And we're going to give a shot. And that kind of started an upward spiral. I came of age during the internet in the nineties, went to graduate school at Berkeley and it just started a series of startups. Some failed, some worked. Then at a very young age, I was blessed with the curse of thinking, what do I want to do with the rest of my life?

5:00I decided I wanted to teach, joined the faculty at NYU 22 years ago, taught 3 ,500 students and then started to leave, surely making content, books, podcasts, newsletters, and that's where we now? I guess the question I have, there was a moment for me. I was a wayward teenager driving my Camaro on Long Island. We're roughly contemporaries. I was chasing skirts and not caring about anything. I had good grades. I ended up getting into Tufts. My father cashed in his life insurance policy from his union to give me$10 ,000, Scott. I can remember the day he handed it to me. It was April of 1982. He handed me the check and he said, this is really all I have to help you go to college.

5:44And that was a big moment for me. I was like, all right, this is super important to my dad that I not screw this up. And then I made a academic commitment in college, which saw me to the Harvard Law School and saw me out the door to Goldman. Was there a eureka moment for you? Was there something between you and your mom? Was there something between you and yourself where you said, okay, I've got to start this upward spiral as opposed to meandering? Oh, 100%. And it's a generous question. I was in graduate school, kind of been sleepwalking through life up until that point. I had a 2.27 GPA at UCLA.

6:18Was at Morgan Stanley for a couple of years, talked my way in there, but didn't like it. So left. Was living again at home with my mom. Got into graduate school. In the middle of my first year in graduate school, my mom called me. My mom had gotten sick with breast cancer and she called me and said, you need to come home. I'm not doing well. And my mom's not a dramatic person. And I walked into a situation that was pretty, pretty frightening for me. It was like nothing I'd ever dealt with before. She'd been discharged from the hospital early as some of these HMOs do. And there were certain things I just couldn't help her with.

6:48And I remember calling around trying to get a nurse and nurses were$35 an hour and we just didn't have the money. And I just remember what a feeling of kind of emasculation and humiliation it was to be the only man of the house and I couldn't take care of my mom who had taken such good care of me. And at that point, I just realized, um, uh, I'm going to try very hard to develop economic security so I can take care of my mom. And I wasn't, you know, my mission wasn't to save the world. It wasn't going to be a good person. It wasn't to, you know, it wasn't to create jobs. It was to get economic security.

7:21It was just super important to me because I felt like I had failed taking care of my mom. And it was just a very ugly moment for me, but that's really when I got my act together. It's interesting. That's like me. I was searching for economic security, but you and I grew up in a different America, Professor Galloway. Okay. And I want to go to your TED talk for a moment, which is titled How the U.S. is Destroying Young People's Future. I've heard you say this many times. I've watched many of your interviews. You and I have had personal conversations about this, that American males are struggling, youth in general are struggling.

7:54Give us some of the stats that you often cite and tell us why this is happening. What is the cultural change in the United States that's contributing to this? Well, let's go back to UCLA. When I applied, the admissions rate was 76%. Today, it's 9%. When I graduated from business school, I made$100 ,000 a year, and the average house in San Francisco costs$280 ,000. Now, the average salary is$200 ,000 total compensation and the cost of a house is 2.1 million. We have purposefully decided to artificially create scarcity around housing and colleges. How many people do you hear, I would never get into the college I applied to if I applied today?

8:33Well, that means your daughter's not getting it. A lot of these universities sit on the endowments of a small Latin American nation, yet they purposely constrain the number of freshman seats because it makes them feel important. And also the alumni like it because if all of a sudden I own a home, I get very concerned with traffic. And one of the great, great problems in America is that housing permits have put in the hands of owners versus public officials. So we've had one and a half to three million fewer households built every year than we've needed. The result is that the primary lubricant for upward mobility and means of kind of forced savings and starting a family and really the March shorts adulthood, buying a home, haven't put out of reach.

9:14It used to be just pre-pandemic, two thirds of people could afford a home now it's one third. Pre-pandemic homes were 290, they've gone to 420. With the acceleration in interest rates, the average mortgage has gone from 1100 to$2 ,200. Again, taking it from two thirds of people who can afford a home to one third. Every economic policy, I believe Anthony, is nothing but an elegant transfer of wealth from the young to the incumbents to the old. Two biggest tax deductions, mortgage interest rate and capital gains, who owns homes and stocks, people our age who rents and makes their money from current income, young people.

9:48So the result is the average 70-year-old is 72 % wealthier than they were 40 years ago. The average person under the age of 40 is 24 % less wealthy. 60 % of 30 to 34-year-olds 40 years ago had at least one child. Now it's 27%. And that in concert with social media, the outsourcing of jobs across industries that especially give young men an on-ramp into college who aren't cut out for college. And we knew that person could take wood shop, bottle shop, metal shop, get a decent job in a factory and manufacturing. Those jobs have dried up. So we now have essentially are raising the most obese, depressed, anxious, and addicted generation in history for the first time in our nation's history.

10:34First time a 30-year-old man or woman isn't doing as well as his or her parents were at 30. So there's the trope that the young people are entitled. No, they're entitled to be enraged. Take COVID and I'll wrap up here. $7 trillion stimulus plan. 85 % of it wasn't needed. 85 % of it wasn't spent, which meant it went into the market, which took housing prices in the stock market to record highs, which was great if you were an incumbent. But if you're an entrant, it just made everything more expensive. When you bail out the baby boomer owner of a restaurant, all you're doing is robbing opportunity from the 26-year-old recent graduate of a culinary academy.

11:09We need churn. We need disruption. The reason I'm here at the Beverly Hills Hotel and with you is because since 2008, we bailed out the banks, but we didn't bail out the economy. So I, as I was coming into my prime income earning years, got to buy Netflix, Amazon, and what was the third one I bought? Apple at between$8 and$12 a share. And they're up between$30 and$60 fold. Where does a young person find disruption, churn, and opportunity now? So we have embraced this rejectionist LVMH strategy where we artificially reduce housing. We artificially reduce college admissions. and young people as a result just don't have nearly the opportunity we did.

11:47The closest they get to prosperity is they get to throw their credit card into the club where I'm doing rails and champagne and I run up their credit card. We have lost the script. We're no longer making the types of forward-leaning investments previous generations used to make. So, I mean, that's the LVMH strategy that you talk about. Tell us a little bit about what you mean when you call it the LVMH strategy for higher education. Well, LVMH could make more Dior bags. They could make more Ramboa suitcases. These aren't difficult items or Vuitton bags. These aren't difficult items to manufacture.

12:20But the key to desire is scarcity. When we came off the Savannah, there were a variety of items that were scarce. Sugary, salty, fatty food, mating opportunities, opportunities for free, safe play. So scarcity, sexist or in the English language is no. The moment you sense there's too little of something, you become obsessed with it. So when I walk into the Panerai store in Aspen, they tell me whenever you look watch I look at limited series, only three left, which makes me want one. And essentially, the U.S. has decided that the ultimate strategy for creating all use academics, my industry, my colleagues wake up every morning.

12:54We ask ourselves one question. How do I reduce my accountability while increasing my compensation? and we've adopted this bullshit rejectionist LVMH strategy where despite the fact that you sit on the Harvard endowment of$53 billion Harvard your endowment is up 40 fold in the last 30 years but you've increased the freshman class size 4 % because the alumni love it because their degree goes up in value when it gets very difficult to get in and we've embraced the same kind of strategy as a luxury brand we've decided that housing and we've decided that college degrees should develop a scarcity and an aspirational value.

13:33And it's allowed us and those in the housing industry and those in the academic industry to raise prices faster than inflation because there's just too few of these things for no reason other than we've decided that a great strategy is to constrain supply. Harvard could have 15 ,000 students, not 1 ,500. They have the resources and yet they decide to keep it very small and very exclusive. In my industry, we've morphed from public servants to Chanel bags because it makes us feel important. So let's say we could put you in charge. Let's say that you were having a meeting at the White House. It was for the new Trump administration or the new Harris administration.

14:12And you went over these numbers with the future presidents. It's January 2025. And that president, he or she agrees with you and says, OK, we have a crisis. And so I think this is one of the problems. and you and I talked about this over the summer. I think you said this to me, and I'm paraphrasing, so correct me if I'm wrong, but there are 75 different advocacy groups at NYU. None of them are related to white males. They're all related to different types of people, ethnic backgrounds, et cetera, different orientations, but none for white males. So there's an epidemic going on. There's a psychological struggle going on.

14:49What are some things you would recommend from a policy initiative that would help these people? So you mentioned something and I just want to touch on it. And that is these problems are especially acute amongst young men. Young men are four times as likely to kill themselves as a young woman. After divorce, a man becomes eight times more likely to kill himself. If you were in the morgue and there were five young people who died by suicide and four of them were men or four of them were any specialist group, you might decide to weigh in with programs and try and do something. But because of the advantage that you and me received, there's a lack of empathy for young men now because we've had a 2000 year head start, which is really a shame.

15:23because empathy isn't a zero-sum game. Civil rights didn't hurt white people. Gay marriage didn't hurt heteronormative marriage. But we've decided to hold a 19-year-old male accountable for the advantage that you and I received. So this has really hit young men, especially hard, who don't have access to some of the manufacturing jobs and middle-class jobs that were so important to young men throughout most of our history. Now, what could you do about it? There's a lot of things we could do. One, redshirt young men. They should start kindergarten at six. Girls start at five. Boys biologically mature later.

15:56Their prefrontal cortex is literally 18 months behind. A 17-year-old, two 17-year-olds applying to college, the 17-year-old girl is basically competing against a 15-and-a-half-year-old. We need more males in primary school. 70 % to 80 % are female. It's natural that they champion a young girl, someone they see in themselves. There are more per capita female fighter pilots in the U.S. than there are male kindergarten teachers. The result is that on a behavior-adjusted basis, a boy is twice as likely to be suspended for the exact same behavior as a girl, a black boy five times as likely. If you are not growing your freshman seats at a college faster than population growth, and you have an endowment over a billion dollars, I believe you should lose your tax-free status because you're no longer a public servant.

16:40You are, in fact, a hedge fund offering classes. I believe we need national service. I think we need young people to move from an age of grievance to an age of heroism and meet people from different sexual orientations, different ethnic backgrounds, different income levels, and realize that they're working in the agency of something great, and that is our nation. I think we need to do away with capital gains tax. There's absolutely no reason why we should be transferring wealth from young people to older people. I think we need expanded child tax credit. I think there's a ton of things we could do to put more money and prosperity in the pockets of young people, and at the same time, give boys more of a fighting chance.

17:18On a more social level, I think we need to recognize that the single point of failure for a young boy is when he loses a male role model. And we have the second most single parent homes. It's interesting, Anthony, girls in single parent homes have the same outcome, same rates of college attendance, same rates of self-harm. Boys immediately come off the tracks and become dramatically more likely to be addicted to opioids, end up in jail. And so I think we need to recognize that white boys are physically stronger, they're mentally and emotionally much weaker. And I think we need a series of programs immediately when a boy loses a male role model that we should weigh in with big brother programs, social programs, ability for him to find his tribe.

17:59And also just on a very personal level, guys like you and me who've recognized some success, we need to get involved in the life of a boy that isn't ours biologically. The ultimate expression of masculinity, and I think about this a lot, you need to take care of yourself, you need to take take care of your family, need to take care of your community. But the ultimate expression of masculinity is to get involved in the life of a young boy. You don't need to be virtuous. You just need to be living a good, righteous life. And unfortunately, because of the Catholic Church and Michael Jackson, anytime a young man has love to give or care to give to a young boy, he is suspected there's something wrong with him.

18:34There are four times as many likely, there are four times as many female applicants to little sisters than there are to, excuse me, big sisters than there are to big brothers. So if we want better men, we need to be better men. We need to get more involved in the lives of young men. And if you look around, Anthony, they're just so easy to find. Your assistant's a single mother. Your friends have gotten divorced. Your friends have a son who is struggling. Young men struggling are everywhere. And a lot of times all they need, there's just certain things men can provide for boys that women cannot.

19:05And there There are men, literally millions of men who go through school, go through college or don't go through college, go into the workforce and haven't had a single real male role model in their life. So there's a variety of social economic programs. And there's also just we need a new zeitgeist in our society that as soon as you have some success, it doesn't have to be monetary, but you're living a virtuous life. You get involved in the life of a young boy. well i mean i think there's a lot you people like you and i can do in that area by the way and i i totally agree with you and i have four sons and everything you said about their rise compared to your rise or my rise is true now they have the advantage of having me as a dad of course but they're still up against varying cultural speed bumps uh that we've uh i think we've put in their way.

20:01And I think we've done it in a unnecessarily, there's no, there's no reason for that, Scott, you know? Well, just look at school, look at my industry. Who do we, what are the incentives? What are the behaviors we reward in school? Sit still, be organized, be a pleaser, raise your hand. You basically describe a girl. And so, and now in college, you literally have a situation where you're going to have three female college graduates in the next five years for two, every two boys. And you think, well, it's time and that's great. Women are ascending. And we We should do nothing to get in the way of that.

20:32There's been no group that's ascended faster than women globally. More women are seeking tertiary education than men right now. In terms of parliament, in the last 30 years, twice as many women have been elected to some sort of parliament electoral body. We should do nothing to get in the way of that. We also need to realize, though, that there's a weird dynamic here. And we don't like to talk about this because it feels sexist. And I've said I'm a sexist. I believe that for the most part, 95 % of our population identifies as binary and men and women are prone to different types of behavior. And in the mating market, women mate socioeconomically horizontally and up, men horizontally and down.

21:1275 % of women say economic viability is very important in a mate. It's only 25 % for men. And when the pool of horizontal and up of economically and emotionally viable men keep shrinking every year, we end up with a lack of household formation. How many times have you heard, I know all these great women who are high character, attractive, together professionally, and they can't find a man? No, they can find a man. They just can't find a man they want to date. So the result of some weird things in the mating market, one out of three men under the age of 30 has a girlfriend, two out of three girls under the age of 30 has a boyfriend because women are dating older and older.

21:47And because they have less money, there's a lack of household formation. And it's especially rough on men. When a guy doesn't have a prospect of a romantic relationship, he doesn't make friends. He isn't as interested in getting a job. He tends to get more involved in things like conspiracy theory, more prone to believing misogynistic or nationalist content, not leaving the house. In some, he becomes a really shitty citizen. Loneliness is no less tragic for girls, but the outcomes aren't as severe. They're better at maintaining social networks. Oftentimes, they pour that additional romantic energy into their career.

22:20So you have this entire generation of men that are kind of becoming a new species. They're very isolated. They're very lonely. They have the deepest, pocketed, most talented people in the world trying to convince them they can have a reasonable facsimile of life with a screen and an algorithm. I don't need friends. I have Discord and Reddit. I shouldn't go through the humiliation of trying to get a job. I'm going to trade stocks and crypto on Robinhood And on Coinbase, I don't need to go through the rejection and effort of showering, getting in shape, having a plan, enduring the rejection involved in mating.

22:52I have you porn. So you have just half of millennial men have a given up dating. They're not even trying. Three million able-bodied men aren't even seeking work. So we have this kind of new species of man who is essentially alone, sequestered from the rest of society, isn't making an effort to advance his or her skills. and by the time they're in the late 20s, they're kind of unsavable. One out of five men at the age of 30 is still living with their parents. One out of three moves home after college and they're just falling off the map and they also become dangerous and not, it's important not to stereotype as every incel is going to become a mass shooter, but what they do is they become dangerous to themselves.