Debt Ceiling, Trump Town Hall, and Guest Claire Hughes Johnson

23:18And there is$2 billion to be divvied up at the end of the year from advertisers instead of five. So you're about to see just everything get a little shittier and a little worse. And, you know, whether it's – there'll be all sorts of arguments for AI and there's leverage between the studios and writers. At the end of the day, the thing causing all of this is there's not enough money to go around. Yeah. Because if cable viewership was up and they still commanded the CPMs, there probably – or there were still just a ton of people were watching a ton of late-night television or ad-supported television.

23:53The studios probably would have come to an accommodation with the writers. and Elon Musk, I would think, wouldn't be cutting parental leave. I was about to say, I don't think he's malicious, but I think sometimes he is. I just think you shouldn't expect it with him. Although Tesla has 16 weeks paid leave, which is interesting. We've made a lot of progress around that. I mean, paternity leave, we're not two words you ever heard in the same sentence when I was working. No, I get it. But still, we haven't made progress. The United States sucks on this issue. 100%. I mean, I don't even want to say we made progress because it really isn't.

24:22It isn't progress. California, 12 weeks unpaid leave. Well, thanks. You know, you just get to leave. You just don't get to pay for it. I think it's just really the way we treat parents with children. A lot of the better companies, and granted, it's still, I mean, we don't have, we've got to pay for it. We have to have universal child care if we want to maintain a growing workforce. So there's a lot of places we could start. I'm just saying in terms of the best company, when my mom was working, you got two weeks vacation a year. And my partner at Prof G, Catherine Dillon, who runs the company, talks about at ABC News, they got two weeks maternity leave.

25:03That was hard when I had Louie. Louie's about to turn 21. I was – it was a whole – you had to cobble together stuff and companies finally got – companies are the ones that are better. And I'm just saying, whatever, they should. They should. It's a good cost to pay, but companies can decide. The world that this generation doesn't recognize is the difference between, and I'll use business in school as an example. The average graduate of Stern right now, they're making incredible money. And I think the average number of offers is somewhere between like three and five offers per student. Wow, that's good.

25:38When I got out of business school in 1992, in the midst of a recession, 40 % of the graduating class on the day of graduation had a job. So the majority of us had zero offers. Right. And the negotiation with an employer was just entirely different. The benefits, the amount of leave, the asymmetry of power or leverage between capital and labor has massively benefited labor for about 20 or 30 years across the information economy, not across the lower end of the spectrum. But if you had the right skills and the right certification, effectively, all management meetings were about how do we surprise and delight employees with compensation, economic and non-economic to keep them happy here.

26:22And for the first time in the young adult lives of the majority of information workers, the power has swung back to capital. And Elon will do whatever he wants. And speaking of doing whatever he wants, Tucker Carlson, as predicted here on Pivot, reportedly spoke with Musk about working together, although he's – Shocker. Shocker. Are you shocked? I'm shocked. No, I'm not shocked. I love being right. I'm shocked. Though he's supposedly having similar conversations with Rumble and Newsmax. Chris Ruddy is really out there doing a fan dance for him, maybe looking into his own venture. Maybe he's going to do his own podcasting.

26:53Maybe he's going to do his own events. There was one about whether he's going to do a Republican debate. He's still under contract, though, with Fox into early 2025. He'd have to get out of that before he could join anybody, which means they can do whatever they want with him, which is hysterical. He can make as much noise as he wants. They don't have to let him out of that contract. I don't know. Do you think they probably will if he takes less money, presumably, right? If they owe him 20 and if he takes five or something like that? Well, it depends. there's usually something called garden leave and that is when you leave you have a contract that says there's a cooling off period and investment banks it's very common because they don't want the guy who's running coverage for health care he can't do anything until 2025 with anybody he's quite locked up my guess is if they really want to if they really want to stick up the middle finger and my sense is these guys have a middle finger the size of the Empire State Building and are willing to use it they would just pay them and keep them off the market and let his career waver a little bit.

27:51I don't know how much money we're talking about. I think it's like$20 million for something that sticks in my head. Yeah, but for a guy like Tucker Carlson, who I would imagine has made hundreds of millions, the biggest fuck you would be to let his career atrophy, pay him the money so he can't do anything. Yeah, maybe they'll do that. He's got a pretty tough lawyer, same lawyer that Don Lemon has, but we'll see if they let him. The lawyer is making a lot of noise, which means I think Fox is like, fuck you, we're not letting you out of the contract. Because the lawyer is suddenly blabbity-blabbing.

28:18If I were Rupert Murak and I really didn't like this guy and it sounds like he generally doesn't like him, I'd be like, OK, boss, go fade into oblivion. Here's your here's your here's your 20 million. Fade to black, my brother. Yes. Right. In two years, no one's going to remember who you are. Yeah. Could be interesting. I'll see. He's going to try to get out. But the ratings have plunge since he was let go, as you said. And so I think they're going to sideline him. I think they're going to sideline him. Yeah. There's always a deal in some way. But it was interesting. The lawyer is suddenly rather loud about the issue.

28:45All right, Scott, let's go on a quick break. When we come back, the debt ceiling is getting closer and lower, and the Republicans want to slam right into it. And we'll speak with a friend of Pivot, Claire Hughes-Johnson, about a wide range of topics.

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31:12Scott, we're back. And so are the negotiations over the debt ceiling. House Speaker Kevin McCarthy is headed to the White House on Tuesday to try to hammer out a deal with President Biden and congressional leaders. No deal is expected, though, and time is running out. Treasury Secretary Janet Yellen says the country has only weeks left before it hits an economic and financial catastrophe. And that's the Treasury Secretary. Oh, that's scary. The Secretary also warned against proposals to invoke the 14th Amendment to avoid breaching the debt ceiling. Scholars say that doing so would cause a legal fight and turmoil in the markets.

31:43The 14th Amendment has a provision that says a validity of public debts shall not be questioned. I can't believe we're going to the 14th Amendment at this point. What would be the economic effect of a default? One analysis by Moody's projected the Republican budget could destroy nearly 800 ,000 jobs. We'll just review quickly. The House has passed a bill to raise the debt ceiling. The bill goes after the Inflation Reduction Act. Chuck Schumer says it's dead on arrival. And McCarthy is only a five-vote majority in the House, so he has to keep everyone on board, including the Freedom Caucus. Yeah, I don't fully understand.

32:19I mean, first off, America has this secret aircraft squadron that several hundred aircraft carriers called the U.S. dollar. Everybody uses our dollar. The other incredible weapon we have is that the cost of capital is the lowest for all American businesses and individuals because our government can borrow money at a lower rate. And the reason they can borrow that money at the lowest rate globally, maybe the exception of Japan and Germany, I shouldn't have said the lowest, Switzerland, Germany and Japan probably have lower rates, but is the full faith and backing of the US government means something.

32:54People believe they're going to get their money back. And any interruption in that, essentially, is this insidious, somewhat imperceptible, but real impact on everyone's lives. If interest rates go up and the short-term havoc it would wreak would just be immense. And not only that, it's the definition of a self-inflicted wound. The other thing that strikes me about this, Cara, is that the Republicans have normalized this hostage-taking because it wouldn't be any less strange. It wouldn't be any less un-American than if the Democrats said, we control, you're the Republicans, you're the ones that love business, you're the ones that are supposed to be the market people and the adults in the room that hold the checkbook, right?

33:33We Democrats who control the Senate want you to fund universal child care and increase Social Security and social programs or we're not going to agree to raise the debt limit. It would be no different than if the Democrats took the whole thing hostage. Child care for all, although I'd be going, yay. And yet we have decided, because it's the Republicans that do this over and over, that this hostage-taking is somehow a legitimate point of negotiation for the Republicans. It really isn't. And even the left, even the liberal media is saying, well, you got to hand it to him. I want to meet the press this weekend with Chuck Todd.

34:11Chuck Todd. They said, well, the Republicans have put forward something that's reasonable. And I'm like, the whole thing begins from the premise of being unreasonable. And that is, why would any one party just hold a gun to the head of the economy to try and get leverage? Why wouldn't the Democrats do the same thing? How have we normalized Republicans taking the debt limit as a hostage? He's got a pretty hard right side. He's got a pretty hard right side. Of course, there's other districts that are less so in the Republican Party that might move over to the Democratic side. And of course, everyone has an interest in lowering the deficit, FYI.

34:45It's far too high because of both Republican and Democratic spending. That's a conversation we should have. We should have conversations around spending and how we cut it and be responsible. But what's most cynical about this hostage taking is they don't want to even outline, even when the Democrats say, okay, what are you proposing we cut? The Democrats, the Republicans don't want to even outline specific programs they'd cut. They want everyone to do it so everyone takes the blame. They're like, we just need to spend less, but they wouldn't dare say what they want to spend less on. If you were an AI generative model that looks at the relationship between words and patterns such that it can predict the next word, you know, that the color of the night sky is black or blue, depending on the time of the night.

35:25It figures out the relationship such that it can predict what would be the next word and the relationship between those words in a sentence. If it did the same thing around what's happened with the debt ceiling fights, it's usually that as we get closer and closer and the markets become more jittery, Republicans realize this is a losing issue for them. that if in fact they do tank the economy, that the majority of the blame won't be on the president at the time. It will actually be the Republicans. So I think it's a winning issue for the Democrats with the Democrats to say, this is a hostage taking.

35:54We're not even going to validate this or justify it with an attempt to negotiate. We just can't. What do you imagine happening? Like they're going to get together and Biden's been nice. He's saying that Ken McCarthy is wise. He's not being too mean. I noticed he was being rather gallant. What do you imagine happening? They won't default on this. The Biden administration will give them something like an agreement to look at this or a committee or whatever it is such that Kevin McCarthy and Republicans can declare victory and say they got something. Yeah. But this is a loser. I would imagine this is a loser issue for the Republicans.

36:29Yeah, they've gone out on a limb here like an idiot. I mean, this is Brexit. This is our form of Brexit. That is probably the greatest self-inflicted unnecessary wound in the West over the last decade. You know, if you go back 20 years, you'd have to say invasion of Iraq. Anyways, the biggest one, though, by far, would be if we miss a debt payment and cause this crazy havoc in the capital markets. The stock market, especially with everything else happening with the banks. It's just – it's a really badly timed and, you know, especially with the deficit, which everyone's responsible for, not just Trump.

37:02Of course, increased it quite a bit. But other presidents have also. I think Clinton was the one who brought it down, which is kind of funny. George Bush exploded it. Basically been tax cuts and wars and then the pandemic. Pandemic, yeah. But yeah, it's Republicans that have exploded the deficit. Well, both. There's been Democrats who did. I mean, yes, but yes, Republicans have not been conservative in this regard. But they just want to go after the kind of things they want to go after and increase spending on things they like. But you're right. Reagan started it. Yep, 100%. Vice President Cheney is famous for saying deficits don't matter.

37:34And this is the problem. The reason why financial services companies go out of business and banks go out of business is not because they're bad businesses. They go out of business because of mismatched durations. And that is they take in short deposits, people who can get their money back in two minutes on their iPhone, and then they loan it long. And that is they can't call in a mortgage. They can't call in a business loan on three minutes notice on an iPhone. Mismatched durations. And you have the same thing here. And that is we have a mismatch in durations from a civic standpoint. And that is our elected officials aren't around long enough to have incentive to try and think long term.

38:15That's right. Because the deficit is like, that'll be the next president's problem. Yeah, that'll be some of this. We will maintain low interest rates. We can pay the interest on this massive increase in debt. That'll be someone else's problem. And I will no longer be in office to deal with it. So we have mismatched durations from an incentive standpoint. Yeah, they definitely have to have discussions about cost cuts. But nonetheless, they're just trying to take away politically from Biden the win, like the Inflation Reduction Act. But we'll see where it goes. Just one more point here. I apologize, Sarah.

38:43No, go ahead. The thing that's just so ironic or so – I mean, you got to really respect the Republican Party. The Republican Party represents the 1%. And the 1 % is super important. Our innovators, they control a disproportionate amount of the capital and influence. Okay, they do a great job. What's super impressive, though, is they convince a lot of people, not even at 98 percent, but below 50 percent in terms of income earning households, that they represent them. And if you look at social spending, they get more money from the federal government than they pay into it in taxes. You would think that every red state would love big government because they're the ones that are benefiting from it.

39:17They do. They're takers. I point this out every time they start going on about – I'm like, well, then stop taking so much. Stop taking so much from California, which is a giver. Yes, that should be pointed out continually how certain states, most of the states that take are red states. Anyway, let's bring in our friend of Pivot.

39:42Claire Hughes Johnson is the former chief operating officer of Stripe, where she remains an advisor. She also spent 10 years at Google. She's the author of Scaling People, Tactics for Management and Company Building. Scott, I brought her here just for you. So Claire, welcome. we've known each other a long time since you were back at Google, right? And then you went all over the place. You went to a number of different companies, including Stripe. I want to know, talk to me, because one of the reasons is you were at companies that scaled. So talk about this idea of what scaling is for people who don't understand.

40:13There are companies that cannot, don't scale well as they get bigger. Google obviously wasn't one of them. So talk a little bit about what the concept so people can understand it. Well, I think when people talk about scaling, they're usually talking about getting to high growth. And that's usually, Kara, talking about like, did I get product market fit and then really take the traction and the opportunity so the market in front of me and grow quickly. But I think you referred to this. I think of scaling as how do you actually build a company to last? How do you build so that you don't fall over in the process of that high growth or even maybe not high growth?

40:50But my book, scaling people is really more about intentional investment in company operating structures and how you hire and how you invest in teams and people. Because I think the companies that do fall over or do run into trouble, it's often because they don't have a great foundation. For that of scaling people, of the talent itself. So talk about what are the most important things when you think about that? And of course, there's a difference between, you know, Google back in the sort of the salad days and now, which is very different. But what are the most important elements? Well, I think that, by the way, I mean, the whole, my philosophy of the book is yes, people matter, but it's investing intelligently in operating structures.

41:31So the system in which you operate and the people, which is how you get outsized results, as opposed to that being an afterthought. And I think there's a lot of resistance in young companies to processes and ways to make decisions and ways to actually identify talent and develop them. And And that is all known by many great big companies as important. And so why not? Let's talk about it for something that's younger. Google, I think you probably remember, early on didn't have a lot of belief. Chaos is how I recall. Well, not a lot of belief in management, right? They didn't. That's correct, yeah.

42:02And it was not highly valued. Let's just say that. And that was something that I struggled with because it mattered to me. It mattered to me that I was a great manager. It mattered as I became a leader, which I think is a different skill set. And I think that did change. That did change over time at Google, but it was pretty chaotic. So what do you mean when you say you've got to have it, when you're saying there's got to be management there or being a good manager right now? So management to me and part of like this book is very tactical. It's sort of like, how do you do the thing? Templates, outlines of conversations, guides.

42:37And a lot of that is because John and Patrick, the founders of Stripe, were like, look, you end up, especially as a founder, All of a sudden, you've built a product and gotten product market fit. And then you have to do something pretty different, which is build a company. And you need to put a lot of things in place. And you also need to manage people all of a sudden. You're suddenly hiring and managing a leadership team. Often in tech, there are people who have more experience than you have, right? And so I think that when I say management, I think it's a very knowable skill. It's very trainable.

43:06It's like, look, I've got an assignment. This is my scope of responsibilities. I've got to get from A to B. So I've got to collect the right portfolio of people, get the best out of them, track progress, set metrics and goals and execute. Right. Like and by the way, coach and understand. I mean, the hardest part about management is you have to manage different people differently. What motivates Kara versus Scott? I bet it's pretty different. And so your job is to sort of, I say, be an explorer, not a lecturer, is to like really figure that out. Because if you want to get, you know, 3x returns, I mean, I'm not an engineer, a 10x engineer.

43:41can build a product by themselves. The only way I scale and the only way I have impact that's 10x or 3x even is through people. And so if you don't get good at that, I don't really know what you're doing with your time. Right. Scott, this is your area. I'm just curious, what are your observations around how best practices regarding management of change in a remote world? I actually don't think they've changed. They've become more important and more intentional and people sort of feel awkward, though, doing them, right? Because a lot of best practices have to do with hallway conversation or let's touch base after the meeting.

44:18Let me see how you think you did in that presentation. Here's some feedback. And you get this sort of synchronous interaction around the work that you don't get in the same way when you're working remotely, which means you have to create it. You have to create windows for your team to connect more personally, even if it's on Zoom or maybe even asynchronously through Slack channels or fun, you know, documents that you share and comment on. And you need to feel comfortable texting, slacking, pinging, calling your team to have the hallway chat. And I don't know that every manager, instead, we're sort of like, leave meeting.

44:54And then we just like forget about our team. And that's a recipe for some trouble. It's so true. The companies I was working at and running, no less than eight times a day, just impromptu, yell at someone or got their eye contact. We could read each other's body language and we'd jump into a conference room sometimes for two, three minutes to talk about something or provide feedback. Or in almost every meeting, we'd ask a couple people or I'd ask someone to stick around just to debrief or whatever it is. you lose most of that, or at least maybe because I'm not disciplined enough, but you just lose that organic fluidity, I find, in remote.

45:38I wonder if they're going to start building in tools to remind people for those organic, more fluid interactions, because Zoom is like, okay, 60 minutes for this, and there's five people on it. Can you think of a company that's been able to start up in the last three years that's been able to scale remotely? I'm not a fan of – I think there's a lot of downsides to remote work, and I'm trying to figure out how companies – what are the better companies that have been able to extend their culture? I feel like they're harvesting a strong culture and surviving, but not building cultures remotely. Yeah, I mean, I do.

46:12I think that I – I mean, I think of Automatic, which owns WordPress, right? And they've been remote, fully distributed for a long time. Forever. And they've published – Forever. Yeah. Forever. And they have, I think, very intentional cadences. I mean, one, they have an internal norm, which is if all three of us were in person in an office, but we were joining a meeting with a few other people who were remote, we'd all three do what we're doing right now. We'd be on separate machines, even if we were physically together, because they're trying to level the playing field of the sort of hybrid communication.

46:45So that's one. Another is they're extremely intentional. And I think Stripe now does this of gathering people in person on a cadence. I think some of their development teams, meaning like design, product, engineering, gather quite frequently, and then others gather less often, maybe at least once a year. I think GitLab has published some stuff. I mean, if you look at Stripe, honestly, Stripe has always had remote employees. When I joined it, when it was 160 people, I would say it was about 15 % of the company. And that was a talent strategy. We weren't going to attract engineers if we didn't sort of hire them from all over the place.

47:20and it was always about 20%. And now obviously it's much higher, but it is about being extremely intentional about your communication practices, how you document work so that people can work asynchronously and then how you intentionally do connect. And I do think, Scott, I agree, people need to be in person occasionally. They need to make the human connection, which I think you can't. And then Stripe is a very avid user of Slack. I mean, we just, there's a lot of, you know, again, hallway chatter that just happens in Slack. And I was actually in a board meeting for another company recently. And most of the board was in person.

47:56We had a few people on video and we had one person from the company presenting. And I was sitting, I happened to be sitting next to his boss. And the guy, right as he finished his presentation, you know, his manager, who's the head of sales at this company, sent him a Slack and said, you know, hey, great job, and made a suggestion. And I loved seeing that. I actually wish he'd asked him first, How do you think you did? But, you know, I think that you there are tools and you can use them, but you have to be intentional. Intentional. So one of the things that had happened and you've been through these days is tech had sort of a real boom with all the benefits, the free lunches, everything else.

48:34Obviously, we're in an era of layoffs now. Stripe, too, has also had to pull in its horns quite a bit. But talk about how you both incentivize employees in this situation that are there and also how you cope with it, because it seems like managers have gotten an upper hand on employees. Or maybe we just discussed that around around Twitter with the parental with the parental leave stuff that was floating around this week. Yeah, I think that I mean, first of all, I've never subscribed. There's just there was sort of a mercenary thing that starts to happen. Right. where it's like an arms race around benefits, some of which, you know, I don't need my dry cleaning picked up at my cubicle or whatever, like benefits that aren't what motivate me as an employee.

49:21It's nice to have them. But I think you want to be focused on what matters to people, purpose, autonomy, independence to do their work, ability to learn. Who am I learning from? Am I getting more responsibility, right? I think going back to those basics is something that, well, good companies didn't really lose, but you can really emphasize. But when you talk about something like parental leave, you know, that's different than laundry service. Right. Right. Or like you can have less, fewer snack options in your micro kitchen and you're going to be fine if you have a good culture, if you have the right other incentives in the place.

49:56I think being strategic about what matters truly matters to people and their kids and their experience as new parents really matters to people. Their health, right, matters. And things that are more like a perk. And I think you have to really be smart about when you distinguish between the two. And what is the power relationship now between, especially in tech, between employees and managers? I mean, you've seen sort of the hard-edged Elon Musk efforts that other people admire. And you, of course, still see most tech companies which are pretty nice to their remaining employees, for sure. There's something here that's a little bit, I don't know, it feels a little Machiavellian or cold, which is depending on, you know, your economic power is how you should decide these things, which I don't subscribe to.

50:40I think company, I mean, there are humans founding these companies and leading these companies. I've been one of them. And I actually do care about the people who work there because I know they are the ones doing the real work. And I am not looking at my economic status to see like, you know, where's my leverage against them? And in fact, I think companies used to have more of that mindset. And I think today's worker, if you will, does not really enjoy that mindset. And they want to feel connected to the place they work in a different way than they did 20 years ago. And that just didn't seem on the table.

51:12But I will also say this, which is there is still a war for talent, right? Especially, I mean, if we're talking about engineers, let's not kid ourselves. There's never going to be enough engineers at any time. I mean, I think some of the advances we're seeing, whether it's an AI or low-code tools, are starting to level that. but not meaningfully. So companies that think they have some kind of power, if you will, I think are misguided. Claire, any thoughts on best practices regarding what I've always thought was the most difficult thing about management was compensation? I said in the book, I was like, I could write a whole other book about compensation, and I really don't want to because it's still like, right now you bringing it up.

51:58I just got like a little bit of a hive. I don't know. It's brutal. It is brutal. And I had no idea when I walked into being COO of Stripe that that would consume so much of my time and energy. Shocking. Like if everyone had to say, what surprised you the most when you joined? That. That is what surprised me the most. How much I had to think about compensation. And if you are lucky enough to be in a high growth environment, meaning your value is growing at a really rapid clip. You get all these inequities of how you did compensation two years ago, where the stock price was, how you think about the next set of employees.

52:33And it's a monstrously hard thing to do. I mean, I have some ideas and some thoughts, but I don't think anyone has figured out any smart practices here. What are your ideas and thoughts? One of my ideas I'll give you is that I came to believe this is going to be, Like there's a lot of energy wasted on these sort of annual increase, whether that's a merit-based increase or it's a market increase or whatever. Like you spend all this energy on a few percentage points of additional salary. And right now we're talking about fairly highly paid positions, right? I mean, I'm just going to. And I came to believe that I think we'd be better off saying, okay, it's almost like a school or some institutions do this, which is you're in this job at this level.

53:17You're a level three engineer. or you're a level two operations coordinator. And you know what? That salary is this, XK a year, 80K, 120K a year. And that salary is going to get reviewed for market data. So we may move that salary up or down based on what's happening in the market, but we're not going to get into like a couple percentage points you perform better than you performed. Where you're going to see any additional compensation is going to come from some kind a bonus program or equity refresh program? Because I think too much energy is spent, you know, working on$500 and you really want to actually level.

53:58So you can't possibly know that Scott should have gotten another$500 than Kara. You should be spending the energy on your top talent and on rewarding the people who had the outsized impact and thinking of how you do that on a, you know, maybe that's twice a year, maybe it's once a year, but that's the thing I want to explore more. The bonus, a bonus, like a bonus. Yeah, a bonus, but it's more like, look, what your inputs and your outputs, how did you work? And then how did you impact what we needed to get done? Which means, by the way, you have to build a good way to measure that. And so I think that's the other place people fall down is they put a bonus in price and they have no way to actually tell the impact.

54:34And I would love to see more team-based impact, by the way. So much of comp is built around the individual. I have a follow-up question around culture. The first company, the only real job I ever had was at Morgan Stanley. And the culture and the implicit agreement between its employees and the organization was, we own you. And you're going to work your ass off. You're going to have no life. And in exchange for that, your career will accelerate faster than it would almost anywhere else. And you're going to make a lot of money for a 24, a 30, or a 36-year-old. And then my first client was Levi Strauss & Company.

55:08And they took the opposite tact. And they said, part of your compensation here is that we recognize you have a life outside of work. We have summer Fridays. We have leave. It is absolutely encouraged to say, I'm a little league coach and I need to be out of here at one o 'clock today. That was encouraged and rewarded. I have not, and maybe it's because I've been out of the workplace for a while. I have not seen companies be able to manage or traverse up and down that based on people's individual needs. Have you? Yeah, I thought where you were going is like, yeah, I do think. Like, I remember my mom, who was a college professor, once like sort of took me aside and said, look, I had to make a choice in my career between money or time.

55:48And that's a pretty hard choice that a lot of people feel like they end up making. Traversing up and down that is hard because you can be, I mean, I have a kid who's going to be applying to college. And if you look at colleges, they're making choices. And you're like, well, do I want to be in more of this kind of grind environment? but they might have better like real world jobs and internships and work you do while you're in school? Or do I want to be in this sort of more flexible, different kind of academic environment, and you could choose one or the other? How do you flex it up and down? I don't know, Scott, what do you think?

56:18Like, I don't think it happens. I think it's pretty hard to build a culture that has that in it. I mean, one thing I have thought about back to the team-based work thing is if you had, you know how sometimes the week of a company or even you guys, you record your podcast, like it's a little slower on this day, then it ramps up to intensity. And then it's sort of like maybe Friday's a little less busy, fewer meetings, whatever it is. I've thought about if there's a way to cycle teams through being really high intensity and then having downtime more intentionally, but I haven't really pushed that thinking very far.

56:53I think where it rears its ugly head and And the reason why many of these companies that offered the best compensation ultimately became more male-dominated and didn't have as many opportunities for women is when this really becomes a problem is when people have kids, specifically when women have kids who still shoulder a disproportionate amount of responsibility. So at Morgan Stanley and these high accelerant, high compensating, you know, very expectation of massive amount of work and commitment, that's all fine and good until you have kids. You said it. The problem there is that women are being expected to shoulder a disproportionate amount of responsibility.

57:27It's not actually women. It's the societal situation. I will say, though, when people ask me about working in tech, which, yeah, it does have a lot of men, but honestly, like, you couldn't pay me to go work in banking when I was coming out of business school. Like, the tech companies, I mean, Google, much better environment. They had child care. Much more progressive. Exactly, Kara. There are overall benefits and actually a certain amount of flexibility. And you know what? The goldmills of the world have gotten better because of the pressure for talent placed on them by tech companies. Let me ask you a question.

58:01You just mentioned AI very briefly. IBM said it will place over 7 ,000 employees with AI in the years to come. It's showing up in HR. It's showing up in all kinds of places. Do you imagine them becoming managers? they would certainly intuitively know what people want and need and what their impact is. Yeah. You know, Kara, I watched, you guys should, I watched Sal Khan give like a TEDx talk fairly recently where he talked about teaching. And AI, and I subscribe to his philosophy. Well, one, I will say to you, it's happening. And if we don't start looking at it and thinking about what it will do, our heads are very far into the sand.

58:42But what Sal demonstrated, and I think this makes a lot of sense to me, is one, you have to create constraints. So I'm in a teaching model or I'm in a manager leading model. So how do I build tooling that's appropriate for that, that is actually augmenting me? Because sure, like me, as a manager, especially say you've got eight, 12 direct reports, am I there every day, especially in a knowledge-based workforce? Yeah, I could know what they do. You could be having to do the first time you've ever done a deeply analytical project. You've got to present to the team. You could have an assistant that walks you through steps of building a model and helps pressure test what you've built.

59:23And I think that's really interesting. Do I think AI replaces the intuition that a human gets? I mean, look, especially when we're in a room together, I can look at your body language. I can smell you. I can see, you know, I can feel you. And I think that is very hard to replicate. But I think an assistant for some of the coaching. And decisions. 98 % of HR leaders said they'd rely partly on algorithms and software to make decision who to cut, for example. That's right. Right. And I think that someone to make you actually, frankly, be more data-driven in certain decisions would be better. Right.

1:00:01Because often the worst, you know, like a promotion. I just don't like the looks of you. Yeah. Who gets the project? Right. Yeah. I like the looks of you. Claire, what advice? You're advising a 22-year-old, someone who's really blessed, come out of a good school, maybe have more than one opportunity. What advice do you have in terms of the questions they should be asking themselves around the kind of person they are and about the company such that they can find the right fit out of the gate? I find there's just a total absence of self-awareness that the kids I deal with just go to the highest prestige, highest compensating firm, and oftentimes they're just miserable.

1:00:36What questions should you be asking yourself and about the company? Yeah, I love that. And actually, my first operating principle that I talk about is building self-awareness, because I actually think too many leaders and managers don't start with themselves. What am I good at? What do I need to compliment about myself? And it's hard to develop that as a younger person. You're talking to a woman who I graduated from a very nice college without a job because I had decided I was going to go work in politics and government and I was going to go break into it. So my advice that I've been giving pretty openly to a lot of people that age is you've got to seek to know yourself and figure out what you're interested in.

1:01:14Truly, if you are blessed to be in that situation, you must have true interest and curiosity in something. And I guarantee you it is not the hot job that everyone's trying to chase right then, the hot company. You've got to do some deep thinking about whether. And if you really don't know, you know, that's a fine thing to do for a few years. Go the common path. But the most interesting careers are the ones that are built with, I think, a little bit of a contrarian approach, a different path. So the very last question I have, who was the very best manager you had? The worst? Yeah, I think probably, you know, I didn't work much directly as Cheryl's direct report, Cara, but she was an excellent manager.

1:01:55Like, how come? She really noticed your work and she was all over you if you were not bringing your A game. But she knew and she got what it was taking to deliver. She was empathetic towards your assignment. And then she was very clear on accountability, in my opinion. Did you say who was the worst? Yeah. I had so many absentee managers, like didn't ever even met with me. Never got a performance, you know, never got feedback, never met with me. I actually flourished. I was like, fine, I'll manage myself. Thanks very much. But that was not just in tech, by the way. That was in some of my early career.

1:02:32They just didn't care, I don't think. I think they were focused on the work, and I get that. But it certainly didn't make me any better. I mean, if I got better, it was me. It wasn't them. Yeah, it was you. It was them. So someone who was there to have accountability and also understand the struggle you go through. Yeah, well, and also give you clarity on what really matters. You are, especially if you're earlier in your career, you're in a system, right? We all know this. Whether it's a small company or a big one or a government institution, you are existing in a system. And that system has rules and unspoken things.

1:03:06And someone who's saying to you, hey, let's think about how to make you successful in this system and hold you accountable for what you need to get done, they notice you. And they show that they care about your outcomes. I don't think it's that hard, by the way, but it is about taking some time. And for some reason, we get very oriented toward the task and we don't think about the people. And I think we pay a price for that. I think a lot of companies pay a price for that. Excellent point. That is an excellent last point. The book is called Scaling People, Tactics for Management and Company Building.

1:03:35It's available now. Thank you, Claire. It's good to see you. Thank you, Karen Scott. Great to see you. Appreciate it. Nice to meet you, Claire. All right. One more quick break. We'll be back for wins and fails.

1:03:51Support for the show comes from Odoo. Running a business is hard enough, and you don't need to make it harder with a dozen and different apps that don't talk to each other. One for sales, another for inventory, a separate one for accounting. Before you know it, you find yourself drowning in software and processes instead of focusing on what matters, growing your business. This is where Odoo comes in. It's the only business software you'll ever need. Odoo is an all-in-one, fully integrated platform that handles everything. That means CRM accounting, inventory, e-commerce, HR, and more. No more app overload, no more juggling logins, just one seamless system that makes work easier.

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1:04:54support for the show comes from odoo running a business is hard enough and you don't need to make it harder with a dozen different apps that don't talk to each other one for sales another for inventory a separate one for accounting before you know it you find yourself drowning in software and processes instead of focusing on what matters growing your business this is where odoo comes in it's the only business software you'll ever need odoo is an all-in-one fully integrated platform that handles everything. That means CRM accounting, inventory, e-commerce, HR, and more. No more app overload. No more juggling logins.

1:05:24Just one seamless system that makes work easier. And the best part is that Odoo replaces multiple expensive platforms for a fraction of the cost. It's built to grow with your business, whether you're just starting out or you're already scaling up. Plus, it's easy to use, customizable, and designed to streamline every process. It's time to put the clutter aside and focus on what really matters, running your business. Thousands of businesses have made the switch, so why not you? Try Odoo for free at odoo.com. That's O-D-O-O dot com.

1:06:01Okay, Scott, some wins and fails. What do you have? I'm going to go first, actually. Wins. Queen Charlotte on Netflix, I just mentioned it. It just was so good. It was so much better than Bridgerton. I have to say, yeah, I love the actors that they pulled from Bridgerton. Does it have as much sex in great graphics? It has a lot more sex, actually. There's a lot of sex happening. Queen Charlotte, more sex in Bridgerton? There's a lot of sex. There's a lot of sex. There's at least an equal amount, but I felt like there was more. And it also was very touching in many ways. It was about the mental illness of King George as a young person and what Queen Charlotte did.

1:06:34And obviously, that's a real story. And this was, of course, Shonda rhymed up kind of thing. but it was really quite lovely. It's only six episodes. It was a lovely little jewel box of a group. It's very nice. And I really thought, well done. A lot of people don't like it, but I do, but it got, it's very popular on Netflix. And I like, they did a great, great job. And, you know, Bella Bajaria, who runs their content, Chief Content Officer, urged me to watch it, which I thought was interesting. And I said, oh, all right. And then I did. So I liked it a lot. I will get to the fail in a second. What's your wins and fails?

1:07:11Actually, my win is, you know me, I don't really enjoy your work outside of Pivot, but I broke down and I listened to your on interview with Roy Wood. And that was my win. I thought it was really good. I think you did a great job of interviewing him. And I was really impressed with him. I had never heard of him. Yep. And I thought he did the best job since Michelle Wolf. but what he managed to do that maybe Michelle wasn't able to do was he was able to thread the needle by being provocative and saying some inappropriate or uncomfortable things, but he didn't really offend everybody. Everybody walked away feeling fine.

1:07:46And that is such a, you know, you were talking about the tasks that the person interviewing President Trump's going to have. That is a tough gig to do the White House Correspondent Center. So I thought he did a great job. And I just really enjoyed listening to him and some of the things he said that he will never make fun of someone's, you know, he has these guardrails. He doesn't ever make fun of someone's personal appearance that he could never, just the way he talked about how he forms a joke, what they think through. I mean, people just think it's someone really funny who gets up there and kind of goes at it.

1:08:18I mean, there is a lot of work. They battle test every joke, how they say it, Who's the subject of it? What's the rhythm, the cadence? And I've always known that was there, but he kind of breaks it down. Anyways, my win is on with Kara Swisher's interview with Roy Wood. I thought that was great. I think you'll really like my Lily Singe if you can make it into a habit at all. I interviewed her up in Toronto, also very thoughtful. What I liked about the Roy Wood one is it went very serious. And we played a lot of his comedy. Obviously, he's very funny. But he's a very serious-minded person. And I really appreciated that.

1:08:54Most comedians are. They are, but he really showed it, right? Yeah. Yeah, I liked him. I just, I felt it was really, I just felt he, I was, I liked the direction that interview went, right? It could have, he could have just been, you know, hand wavy, entertaining, and he wasn't. And what's the other interview you want me to? Oh, Lilly Singh. It's not up yet. It's. I just want to know, because the bottom line is that it's not going to happen. I'm a bit long, Kera Swisher right now. There's too much Kera Swisher. What's your, what is your fail? How about some life with your Kara Swisher, Scott? Yes, life.

1:09:23Yeah. I was in your apartment. I was touching all your things, as I always like to do. I like that. Yeah, it was nice. I have to say. Fail, I don't – I'm trying to think of the fail. Obviously, this shooting, another shooting in Texas, white supremacist, too many guns. I just don't know when people are going to get tired of this. It's really – it's sickening to me. And I would urge everybody to read the Washington Post series on what the damage an AR-15 can do to the human body. They have a series about, it's called American Icon, Deadly Weapons, Divided Nation. It's not really a divided nation, but it's all about the AR-15.

1:10:01And they talk to people who own them and why they own them. The police, even though they have AR-15s, aren't happy that other people, the trauma. It's just a really good series because this is just – we're now at record levels again in this mall in Texas. And you just get numb to it. And it's always some white supremacists doing this. Very dangerous. Very dangerous. Yeah, but we don't – yeah. So my fail is kind of the same thing. And that is – and to be clear, we have white supremacists. We have a lot of mentally ill people. We have a lot of young men who are struggling. that we don't over-index relative to other nations.

1:10:42Where we over-index is access to weapons of war, full stop. And I worry that anytime we talk about these very serious issues, it's usually picked up as a weapon of mass distraction to not talk about the real issue. And we don't have a monopoly on video games, mental illness. What we have a monopoly on is AR-15s and access to them or weapons of war. My fail is along the lines of yours. And that is, and I'm trying to ground it and something that motivates people. And when I'm traveling, that day, my blood pressure is just elevated. When do I need to leave for the airport? What's the traffic like?

1:11:16I'm a little bit of a nervous fight. Just that day, I am less healthy because I am operating in the context of slightly but consistently elevated stress and blood pressure any day I'm traveling. But one of the things I didn't realize that would really be a substantial improvement in my life, because I didn't recognize it. When you're in the midst of a crisis, you don't even realize you're in the crisis because you go into operations or triage mode and you don't realize how stressed you were and how hard it was on you until you're out of it because you get this fight or flight and you deal with the situation and you adapt.

1:11:58And what I realized moving to London is that living in the United States, and my message to fellow Americans is you don't realize the context and the level of elevated stress Americans have to deal with when they drop their kids off at school, when they go into a mall, when they go into a movie theater, when they're walking around a crowded place. The frequency of devastation horror of these mass shootings is not something that happens in most Western countries. And when I'm in the UK and I drop my kid at school or I'm at a movie theater or I'm in a crowded place, this imagery, this stress for me that I was living with in the United States is not there because it is entirely different.

1:12:44And my message to fellow Americans is we don't have to live with this context of stress. Nope. Other nations don't live. Other nations, when they drop their kids at school, don't immediately have any. And I think most parents can't help but occasionally think, all right, what would happen? How would I respond? That's it. I think about that a lot. Alex went to Texas for a prom this weekend for his girlfriend. And I was like, open carry. The first thing I thought of was guns. I don't know why. I just was like, guns there. There's a lot of guns. I know it sounds crazy, but I just had been reading about the open carry and everyone carrying it around.

1:13:24Just the presence of so many guns made me nervous. And I know it's crazy. I've gone to Texas myself. Active shooter drills? Yeah. Do they realize what that is we're doing to our kids to normalize the notion that you have to prepare for a mass shooter? 22 mass killings this year, collectively 115 deaths. It's on pace to break the record. It's ridiculous. It's just ridiculous. And then can I just add a second thing? this weekend, I had a conversation with Louie, and this person who was throttled in the subway was put in that chokehold by the guy on the subway. I get everybody's really exhausted by mentally ill homeless people yelling at them on subways, but the death of this guy, and I don't think this guy malevolently meant to kill him, but boy, placing him in a chokehold.

1:14:11And then the issue I have was Eric Adams not understanding that this cannot happen, vigilante killings, whatever. However, again, I don't think this guy meant it to do it. I just think citizens should not be chokeholding mentally ill homeless people on subways. Like, are you kidding me? That's the same level of fear you're talking about. It sort of was gripping New York, this debate. And, you know, my son was like, I cannot believe this guy did this for that long. But we immediately go to, all right, 45 ,000 people are going to die because of handgun deaths. And so you imagine the way you think of the horror here is what if I was one of those very unfortunate people who lost somebody?

1:14:54And what we don't pay enough attention about is you don't realize how much stress you're enduring distinct of whether or not it touches your life. Because we live in a context of fear and anxiety around this shit. And it's always easy to talk about, but I was trying to find good resources like, okay, what do I do other than vote? And Sandy Hook Promise, the website at sandyhoekpromise.org, has a really thoughtful page on things you can do for gun control advocacy and specific steps and people to call and personally how you acquit yourself and be most effective in advocating for gun prevention violence.

1:15:33But my message is or my fail is obviously this continued violence, but you don't realize until you leave America the context of stress Americans are living in. Yep. It is not, by the way, it is stress that in most other Western nations that also have guns, that also have gun rights, where you can be a responsible gun owner, they don't have to live with that stress. And what we have found in all these studies about happiness is happiness is not only a function of the things you have, economic opportunities and rights. It's absence from a fear that something might be taken away from you. And we need an absence of fear.

1:16:09We need an erosion in the context of stress that all of us deal with in the United States because of this unparalleled precedence of mass shootings. And the other thing is that I thought, I don't know if you noticed this, Kara, but your idea about showing the corpses, supposedly one of the things that really rattled people about this most recent shooting was because it was live streamed, people actually saw the horror. That they said, oh, my God, this is even worse than I'd imagined what actually happened here. There was a controversy of it being on Twitter. I think the parents should give permission, but they should show the pictures.

1:16:47I just don't know the other way. Anyway, it's just horrific. It's horrific. And the fact that our politicians just kowtow and make it into ridiculous political issues, they repulse me even more than those. Anyway, great show. We want to hear from you, by the way, on these issues. If you don't agree with us, agree with us, whatever. Send us your questions about business tech or whatever's on your mind. Go to nymag.com slash pivot to submit a question for the show or call 855-51-PIVOT. Scott, thank you for thoughtful wins and fails this week. It was good and everything was great this week. Anyway, that's the show.

1:17:24We'll be back on Friday with more. Scott, will you please read us out? Today's show was produced by Lara Neiman, Evan Engel, and Taylor Griffin. Ernie Indertot engineered this episode. Thanks also to Drew Burrows and Miel Silverio. Make sure you subscribe to the show wherever you listen to podcasts. Thanks for listening to Pivot from New York Magazine and Vox Media. We'll be back later this week for another breakdown of all things tech and business. call me king.

1:18:14Odoo is an all-in-one, fully integrated platform that handles everything. That means CRM accounting, inventory, e-commerce, HR, and more. No more app overload. No more juggling logins. Just one seamless system that makes work easier. And the best part is that Odoo replaces multiple expensive platforms for a fraction of the cost. It's built to grow with your business, whether you're just starting out or you're already scaling up. Plus, it's easy to use, customizable, and designed to streamline every process. It's time to put the clutter aside and focus on what really matters, running your business.

1:18:44Thousands of businesses have made the switch, so why not you? Try Odoo for free at odoo.com. That's O-D-O-O dot com.

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